SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 13D
(RULE 13D-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED
PURSUANT TO RULES 13D-1(A) AND AMENDMENTS THERETO
FILED PURSUANT TO 13D-2(A)
(AMENDMENT NO. 1)1
Westfield America, Inc.
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(Name of Issuer)
Common Stock, par value $.01 per share
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(Title of Class of Securities)
959910 10 0
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(CUSIP Number)
Irv Hepner
c/o Westfield America, Inc.
11601 Wilshire Boulevard, 12th Floor
Los Angeles, CA 90025
(310) 445-2427
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 29, 1999
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(Date of Event which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check
the following box: / /
Note: Schedules filed in paper format shall include a
signed original and five copies of the schedule, including all exhibits.
See Rule 13d-7(b) for other parties to whom copies are to be sent.
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1 The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 or otherwise subject to the liabilities of that
section of the Act but shall be subject to all other provisions of the Act
(however, see the Notes).
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CUSIP NO. 959910 10 0 SCHEDULE 13D PAGE 2 OF 10 PAGES
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Perpetual Trustee Company Limited, as Trustee of Westfield America Trust
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|_|
(b)|_|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT |_|
TO ITEMS 2(d) OR 2(e)
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Australia
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NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY ----------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 56,418,618
REPORTING ----------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH -0-
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10 SHARED DISPOSITIVE POWER
56,418,618
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
56,418,618
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*|_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
Approximately 64.7%
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14 TYPE OF REPORTING PERSON*
CO
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<PAGE>
PAGE 3 OF 10 PAGES
AMENDMENT NO. 1 TO
STATEMENT ON SCHEDULE 13D
This Amendment No. 1 (the "Amendment No. 1") amends the
Statement on Schedule 13D, filed with the Securities and Exchange
Commission on May 30, 1997 (the "Schedule 13D"), relating to shares of the
common stock, $.01 par value per share (the "Common Shares"), of Westfield
America, Inc., a Missouri corporation (the "Company"). Pursuant to Rule
13d-2 of Regulation 13D-G promulgated under the Securities Exchange Act of
1934, as amended, this Amendment No. 1 is being filed on behalf of
Perpetual Trustee Company Limited (the "WAT Trustee"), as Trustee for
Westfield America Trust ("WAT").
ITEM 2. IDENTITY AND BACKGROUND.
(a) The following persons are no longer directors or executive
officers of the WAT Trustee:
David White
Graham Bradley
Richard Atkinson
Eleanor Dartnall
The following persons are directors or executive officers of
the WAT Trustee:
Gai Marie McGrath
Michael Jovan Stefanovski
Phillip Andrew Vernon
Wayne Ralph Wilson
(b) The business address for Ms. McGrath, Messrs. Stefanovski,
Vernon and Wilson is c/o Perpetual Trustee Company Limited, Level 7, 39
Hunter Street, Sydney, NSW, Australia, 2000.
(c) Ms. McGrath, Messrs. Stefanovski, Vernon and Wilson are all
employed by the WAT Trustee.
(d) No person listed in Item 2 of this Amendment No. 1 has been
convicted during the last five years in a criminal proceeding (excluding
traffic offenses or similar misdemeanors).
(e) No person listed in Item 2 of this Amendment No. 1 has been
during the last five years a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such
proceeding is or has been subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities
subject to, U.S. Federal or State securities laws or finding any violation
with respect to such laws.
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PAGE 4 OF 10 PAGES
(f) Ms. McGrath, Messrs. Vernon, Wilson and Stefanovski are
citizens of Australia.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Item 3 of the Schedule 13D is hereby amended as follows:
In August 1998, the WAT Trustee purchased an aggregate of
416,667 shares of Series D Preferred Stock (the "Series D Preferred
Shares") of the Company for cash consideration of $75,000,060. In December
1998, the WAT Trustee purchased an aggregate of 138,889 shares of Series
D-1 Preferred Stock (the "Series D-1 Preferred Shares") of the Company for
cash consideration of $25,000,020. The cash consideration for the
acquisition of the Series D Preferred Shares and the Series D-1 Preferred
Shares was obtained through an equity placement in Australia which raised
A$118 million, with the remainder obtained from working capital.
The Series D Preferred Shares and the Series D-1 Preferred
Shares are immediately convertible into Common Shares. Each Series D
Preferred Share or Series D-1 Preferred Share, as applicable, is
convertible at the option of the holder at any time, into such number of
Common Shares as is determined by dividing $180.00 (which number is the
aggregate Liquidation Preference of such share) plus accrued but unpaid
dividends by the Conversion Price (as defined below). The initial
Conversion Price is $18.00, subject to standard anti-dilution provisions.
In September 1999, 350,000 Common Shares were acquired by the
WAT Trustee for cash consideration of approximately $4,921,956 which
consideration was obtained from working capital.
In December 1999, 88,800 Common Shares were acquired by the WAT
Trustee for cash consideration of approximately $1,154,106, which
consideration was obtained from working capital.
In February 2000, 614,000 Common Shares were acquired by the
WAT Trustee for cash consideration of approximately $8,359,934, which
consideration was obtained from working capital.
In March 2000, 356,500 Common Shares were acquired by the WAT
Trustee for cash consideration of approximately $4,965,924, which
consideration was obtained from working capital.
ITEM 4. PURPOSE OF TRANSACTION.
Item 4 of the Schedule 13D is hereby amended as follows:
The WAT Trustee acquired the Series D Preferred Shares, the
Series D-1 Preferred Shares and the Common Shares in order to increase its
equity interest in the Company. The WAT
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PAGE 5 OF 10 PAGES
Trustee may continue to purchase securities of the Company from time to
time. However, the WAT Trustee has no plans or proposals which relate to or
would result in:
(1) the acquisition by any person of additional securities of the
Company, or the disposition of securities of the Company;
(2) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Company or any of its
subsidiaries;
(3) a sale or transfer of a material amount of assets of the
Company or any of its subsidiaries;
(4) any change in the present board of directors or management
of the Company, including any plans or proposals to change the number of
term of directors or to fill any existing vacancies on the board;
(5) any material change in the present capitalization or dividend
policy of the Company;
(6) any other material change in the Company's business or
corporate structure;
(7) changes in the Company's charter, bylaws or instruments
corresponding thereto or other actions which may impede the acquisition of
control of the Company by any person;
(8) causing a class of securities of the Company to be delisted
from a national securities exchange or to cease to be authorized to be
quoted in an inter-dealer quotation system of a registered national
securities association;
(9) a class of equity securities of the Company becoming eligible
for termination of registration pursuant to Section 12(g)(4) of the Act; or
(10) any action similar to any of those enumerated above.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
Item 5(a) of the Schedule 13D is hereby amended as follows:
(a) The WAT Trustee owns 56,418,618 Common Shares, which
represents approximately 64.7% of the outstanding Common Shares. This
figure includes the Series D Preferred Shares, the Series D-1 Preferred
Shares and an aggregate of 8,335,648 Common Shares issuable upon exercise
of two warrants held by the WAT Trustee. None of the other persons named in
Item 2 holds any Common Shares. The WAT Trustee disclaims beneficial
ownership of such shares. References to beneficial ownership are made
herein solely with respect to U.S. securities laws and are not intended to
refer or apply in any respect to Australian legal matters.
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PAGE 6 OF 10 PAGES
Item 5(b) of the Schedule 13D is hereby amended as follows:
(b) Other than with respect to the election of directors of the
Company, the WAT Trustee has shared power with Westfield America Management
Limited ("WAM") to vote and dispose of all 56,418,618 Common Shares held by
the WAT Trustee. With respect to the election of directors of the Company,
the WAT Trustee may only vote the Common Shares held by it as approved by
the holders of units of WAT.
Item 5(c) of the Schedule 13D is hereby amended as follows:
(c) The WAT Trustee effected the following open market purchase
of Common Shares during the period beginning 60 days prior to April 29,
1999 and ending on the date of this Statement:
Date of Number Price
Transaction of Shares per Share
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9/21/99 113,000 $14.125
9/21/99 1,400 $14.063
9/21/99 10,600 $14.00
9/22/99 100,000 $14.063
9/22/99 50,000 $14.00
9/23/99 25,000 $14.063
9/23/99 48,900 $14.00
9/23/99 1,100 $13.938
12/20/99 27,000 $13.00
12/20/99 5,700 $12.8125
12/20/99 3,300 $12.750
12/20/99 1,000 $12.625
12/21/99 7,100 $13.3125
12/21/99 6,400 $13.250
12/21/99 100 $13.125
12/21/99 3,800 $13.0625
12/22/99 10,000 $13.00
12/22/99 12,100 $12.9375
12/23/99 200 $13.00
12/23/99 2,800 $12.9375
12/23/99 9,300 $12.875
2/08/00 600 $12.875
2/08/00 1,000 $12.8125
2/09/00 36,200 $13.375
2/09/00 900 $13.25
2/09/00 1,600 $13.1875
2/09/00 300 $13.00
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PAGE 7 OF 10 PAGES
2/09/00 1,500 $12.8125
2/10/00 10,500 $13.50
2/16/00 1,000 $13.6875
2/17/00 43,800 $13.75
2/17/00 2,000 $13.6875
2/17/00 600 $13.625
2/18/00 346,000 $13.625
2/22/00 6,200 $13.50
2/23/00 19,600 $13.3485
2/24/00 142,200 $13.50
3/02/00 11,900 $13.50
3/03/00 105,700 $13.9866
3/06/00 8,000 $13.625
3/08/00 8,000 $13.068
3/09/00 8,000 $13.4844
3/10/00 1,400 $13.4375
3/13/00 6,200 $13.4547
3/15/00 5,700 $13.625
3/16/00 137,900 $13.9427
3/17/00 6,200 $13.7288
3/20/00 5,000 $13.9925
3/21/00 5,000 $13.9888
3/22/00 34,500 $14.00
3/23/00 2,000 $14.00
3/24/00 5,000 $14.00
3/27/00 6,000 $13.7656
Item 5(d) of the Schedule 13D is hereby amended as follows:
(d) Holders of WAT units will receive economic benefits from the
Common Shares and the Preferred Shares held by the WAT Trustee. Solely for
purposes of U.S. securities laws, WHL may be deemed to own beneficially
22.2% of outstanding WAT units and each of Messrs. Frank P., David H.,
Peter S. and Steven M. Lowy may be deemed to each own beneficially 28.8% of
outstanding WAT units. Each of the Messrs. Lowy disclaims beneficial
ownership of the WAT units. References to beneficial ownership are made
herein solely with respect to U.S. securities laws and are not intended to
refer or apply in any respect to Australian legal matters.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER
Item 6 of the Schedule 13D is hereby amended as follows:
Under the Subscription Agreements, dated as of June 25, 1998
and December 17, 1998, each among the Company, WAM and the WAT Trustee (the
"WAT Subscription Agreements"),
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PAGE 8 OF 10 PAGES
so long as the WAT Trustee owns any Series D Preferred Shares or Series D-1
Preferred Shares, as applicable, if the Company shall fail to continue to
be taxed as a real estate investment trust pursuant to Sections 856 through
860 of the Internal Revenue Code, the WAT Trustee shall have the right to
require the Company, to the extent the Company shall have funds legally
available therefor, to repurchase any or all of the Series D Preferred
Shares or Series D-1 Preferred Shares, as applicable, held by the WAT
Trustee in an amount equal to 115% of the liquidation preference thereof,
plus accrued and unpaid dividends, whether or not declared, if any, to the
date of repurchase or the date payment is made available.
In addition, pursuant to the Certificate of Designation setting
forth "Resolution Designating Series D Preferred Shares and Fixing
Preferences and Rights Thereof " (the "Series D Certificate of
Designation"), the Series D Preferred Shares are redeemable, at the option
of the Company, on or after August 12, 2008 at a redemption price equal to
the sum of $180.00 per share and all accrued and unpaid dividends through
the call date specified in the notice to holders regarding the redemption.
Pursuant to the Series D Certificate of Designation, if there
is a Change of Control (as defined therein), the holders of the Series D
Preferred Shares can require the Company, if the Company has funds legally
available therefor, to redeem their Series D Preferred Shares at a cost of
$189.00, plus accrued and unpaid dividends, if any, to the date that the
Company repurchases such shares.
Pursuant to the Series D Certificate of Designation, from and
after August 12, 2008, the holders of the Series D Preferred Shares have
the right to require the Company to redeem their Series D Preferred Shares
either for cash or for Common Shares, at the Company's option, as long as
the current market price of the Common Shares is less than $18.00, adjusted
for events that affect the Conversion Price (as defined therein).
Pursuant to the Series D Certificate of Designation, the
holders of Series D Preferred Shares do not have any voting rights, other
than as required by law, except that a majority of the holders of the
Series D Preferred Shares, voting together as a class, must approve any
amendment, alteration or repeal of the Company's Articles of Incorporation
or the Series D Certificate of Designation that materially and adversely
affects their voting powers, rights or preferences and a majority of the
holders of the Series D Preferred Shares, voting together as a class, must
approve any merger or consolidation that the Company is involved in, if the
Company does not survive such merger or consolidation and the holders of
the Series D Preferred Shares do not receive shares of the surviving
corporation with substantially similar rights, preferences and powers in
the surviving corporation as their Series D Preferred Shares.
Pursuant to the Certificate of Designation setting forth
"Resolution of the Board of Directors of Westfield America, Inc.
Designating Series D-1 Preferred Shares and Fixing Preferences and Rights
Thereof" (the "Series D-1 Certificate of Designation" and together with the
Series D Certificate of Designation, the "Certificates of Designation"),
the Series D-1 Preferred Shares are redeemable, at the option of the
Company, on or after August 12, 2008 at a redemption price equal to
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PAGE 9 OF 10 PAGES
the sum of $180.00 per share and all accrued and unpaid dividends through
the call date specified in the notice to holders regarding the redemption.
Pursuant to the Series D-1 Certificate of Designation, If there
is a Change of Control (as defined therein), the holders of the Series D
Preferred Shares can require the Company, if the Company has funds legally
available therefor, to redeem their Series D-1 Preferred Shares at a cost
of $189.00, plus accrued and unpaid dividends, if any, to the date that the
Company repurchases such shares.
Pursuant to the Series D-1 Certificate of Designation, from and
after August 12, 2008, the holders of the Series D-1 Preferred Shares have
the right to require the Company to redeem their Series D-1 Preferred
Shares either for cash or for Common Shares, at the Company's option, as
long as the current market price of the Common Shares is less than $18.00,
adjusted for events that affect the Conversion Price (as defined therein).
Pursuant to the Series D-1 Certificate of Designation, the
holders of Series D Preferred Shares do not have any voting rights, other
than as required by law, except that a majority of the holders of the
Series D-1 Preferred Shares, voting together as a class, must approve any
amendment, alteration or repeal of the Company's Articles of Incorporation
or the Series D-1 Certificate of Designation that materially and adversely
affects their voting powers, rights or preferences and a majority of the
holders of the Series D-1 Preferred Shares, voting together as a class,
must approve any merger or consolidation that the Company is involved in,
if the Company does not survive such merger or consolidation and the
holders of the Series D-1 Preferred Shares do not receive shares of the
surviving corporation with substantially similar rights, preferences and
powers in the surviving corporation as their Series D-1 Preferred Shares.
All references to, and summaries of, the WAT Subscription
Agreements and the Certificates of Designation in this Amendment No. 1 are
qualified in their entirety by reference to such agreements, the full text
of which are filed as exhibits hereto and incorporated herein by this
reference.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
EXHIBIT A WAT Subscription Agreement, dated as of June 25, 1998.
EXHIBIT B WAT Subscription Agreement, dated as of December 17, 1998.
EXHIBIT C Series D Certificate of Designation
EXHIBIT D Series D-1 Certificate of Designation
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PAGE 10 OF 10 PAGES
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
Dated: April 4, 2000
PERPETUAL TRUSTEE COMPANY
LIMITED, AS TRUSTEE OF WESTFIELD
AMERICA TRUST
By:/s/ Fran Maddock
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Name: Fran Maddock
Title: Attorney
By:/s/ Eileen Chung
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Name: Eileen Chung
Title: Attorney
WITNESSED BY:
By:/s/ Stephen Nicholls
-----------------------------
Name: Stephen Nicholls
WAT SUBSCRIPTION AGREEMENT
WAT SUBSCRIPTION AGREEMENT, dated as of June 25, 1998, between
Westfield America, Inc.(ARBN 082 554 541), a Missouri corporation (the
"COMPANY"), Perpetual Trustee Company Limited (ACN 000 001 007), an
Australian company (the "TRUSTEE"), and Westfield America Management
Limited (ACN 072 780 619), an Australian company (the "MANAGER").
W I T N E S S E T H:
WHEREAS, pursuant to the Trust Deed, dated March 28, 1996, as
amended (the "TRUST DEED"), between the Trustee and the Manager, Westfield
America Trust, an Australian public property trust ("WAT"), was created;
and the Trustee and the Manager have authority to act on behalf of WAT
under the Trust Deed;
WHEREAS, the Company wishes to sell and Security Capital
Preferred Growth Incorporated wishes to purchase $75,000,060 (U.S.) of
Series C Cumulative Convertible Redeemable Preferred Stock of the Company
pursuant to a Series C Stock Purchase Agreement (the "SERIES C STOCK
PURCHASE AGREEMENT");
WHEREAS, the Company wishes to sell and Westfield American
Investments Pty. Limited wishes to buy 277,778 shares of Series D
Cumulative Convertible Redeemable Preferred Stock of the Company, par
value $1.00 (the "SERIES D PREFERRED STOCK"); and
WHEREAS, the Manager has directed the Trustee on behalf of WAT
to subscribe for and purchase, and the Company desires to sell to the
Trustee on behalf of WAT, 416,667 shares of Series D Preferred Stock (the
"SHARES"), subject to the terms and conditions contained herein.
NOW, THEREFORE, to implement the foregoing and in consideration
of the mutual agreements contained herein, the parties hereto hereby agree
as follows:
1. PURCHASE AND SALE OF THE SHARES. Subject to all of the terms
and conditions of this Agreement, the Company agrees to sell and the
Trustee on behalf of WAT agrees to purchase the Shares on the Closing Date
(as defined in Section 2) for consideration as provided in Section 2(b).
The Shares shall have the rights set forth in the Series D Certificate of
Designation, substantially in the form attached as Exhibit A hereto.
2. CLOSING.
(a) TIME AND PLACE. Subject to the satisfaction of the
conditions contained herein, the closing of the sale of the Shares (the
"CLOSING") shall take place simultaneously with the closing under the
Series C Preferred Stock Agreement (the "CLOSING DATE"). The Closing shall
occur at the offices of Westfield America Inc., 11601 Wilshire Boulevard,
12th Floor, Los Angeles, California 90025.
(b) DELIVERY BY THE TRUSTEE. At the Closing, the Trustee shall
deliver to the Company its rights to the Money Market Term Deposit with
Bankers Trust Company ("BT") to be acquired by the Trustee on June 30,
1998 in an amount of $75,000,060, in form and substance satisfactory to
the Company, and duly assigned to the Company (the "BT DEPOSIT").
(c) DELIVERY BY THE COMPANY. At the Closing, the Company shall
deliver to the Trustee on behalf of WAT, a stock certificate registered in
the Trustee's name and representing Shares to be delivered at the Closing,
provided that the Company shall not issue the Shares and shall retain such
certificates until such time as the Company receives from the BT cash in
payment of the BT Deposit of an amount equal to $75,000,060.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
hereby represents and warrants to the Trustee as follows:
(a) AUTHORIZATION. The Company has full power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby in accordance with the terms hereof. The execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby have been or will be duly authorized by the Company.
(b) THE SHARES. The Shares, to be delivered by the Company at
the Closing, as of the Closing Date, will have been duly authorized for
issuance and, when delivered in accordance with this Agreement, will be
validly issued, fully paid and non-assessable.
(c) SERIES C PREFERRED STOCK PURCHASE AGREEMENT. The
representations and warranties of the Company contained in the Series C
Preferred Stock Purchase Agreement are true and correct in all material
respects.
4. REPRESENTATIONS AND WARRANTIES OF TRUSTEE AND MANAGER. The
Manager and the Trustee hereby represent and warrant to the Company as
follows:
(a) AUTHORIZATION. If UnitHolder Approval is obtained, then each
of the Trustee and the Manager will have full power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby in accordance with the terms hereof and on behalf of
WAT. The execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby will be, if UnitHolder Approval is
obtained, duly authorized by or on behalf of each of WAT, the Trustee and
the Manager.
"UnitHolder Approval" means the passing by a meeting of
unitholders of WAT of a resolution authorizing and empowering the Manager
and the Trustee to, amongst other things, enter into the transactions
contemplated by this Agreement for the purposes of the Listing Rules of
the Australian Stock Exchange Limited.
(b) ACQUISITION FOR INVESTMENT.
(i) The WAT Trustee is acquiring the Shares in its capacity as
Trustee of WAT for investment on behalf of WAT and not with a view to
or for sale in connection with any distribution thereof, and WAT has
no present intention or plan to effect any distribution thereof
within the meaning of the Securities Act of 1933, as amended (the
"SECURITIES ACT").
(ii) The Trustee and the Manager understand that the Shares and
the common stock to be issued upon conversion thereof (the
"CONVERSION STOCK") have not been registered under the Securities Act
or applicable state securities laws and agree not to sell, pledge or
otherwise transfer any of the Shares or Conversion Stock in the
absence of such registration or an opinion of counsel reasonably
satisfactory to the Company that such registration is not required.
The Trustee and the Manager acknowledge that the Company is not
required to register the Shares or the Conversion Stock.
5. LEGENDS
The Manager acknowledges and agrees that any certificates
evidencing the Series D Preferred Stock purchased pursuant to this
Agreement and the Conversion Stock issuable upon conversion thereof shall
be stamped or endorsed with legends in substantially the following form
and shall be subject to the provisions of such legends:
"THE SECURITY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED,
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION
THEREFROM AND AS SET FORTH HEREIN.
"THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF
THE ISSUER THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED, ONLY (1) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, (2) IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO (i) THE RECEIPT BY THE
ISSUER OF AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE ISSUER THAT
SUCH REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, AND (ii) THE RECEIPT BY THE ISSUER OF SUCH OTHER EVIDENCE
REASONABLY ACCEPTABLE TO THE ISSUER THAT SUCH REOFFER, RESALE, PLEDGE OR
OTHER TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS, (3) TO THE ISSUER, ITS AFFILIATES, AND (4) IN THE CASE OF
A TRANSFER UNDER (1), (2) OR (3) IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THIS SECURITY OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE."
The Manager acknowledges and agrees that each certificate in
respect of the Series D Preferred Stock shall bear the following additional
legend:
"THE PREFERRED SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS ON OWNERSHIP AND TRANSFER FOR THE PURPOSE OF THE CORPORATION'S
MAINTENANCE OF ITS STATUS AS A REAL ESTATE INVESTMENT TRUST UNDER THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED. NO INDIVIDUAL MAY BENEFICIALLY
OWN SHARE IN EXCESS OF THE THEN APPLICABLE OWNERSHIP LIMIT, WHICH MAY
DECREASE OR INCREASE FROM TIME TO TIME, UNLESS SUCH INDIVIDUAL IS AN
EXISTING HOLDER. IN GENERAL, ANY INDIVIDUAL WHO ATTEMPTS TO BENEFICIALLY
OWN SHARES IN EXCESS OF THE OWNERSHIP LIMIT MUST IMMEDIATELY NOTIFY THE
CORPORATION. ALL CAPITALIZED TERMS USED IN THIS LEGEND HAVE THE MEANINGS
SET FORTH IN THE ARTICLES OF INCORPORATION, A COPY OF WHICH, INCLUDING THE
RESTRICTIONS ON OWNERSHIP AND TRANSFER, WILL BE SENT WITHOUT CHARGE TO EACH
SHAREHOLDER WHO SO REQUESTS. IF THE RESTRICTIONS ON OWNERSHIP AND TRANSFER
ARE VIOLATED, THE PREFERRED SHARES REPRESENTED HEREBY MAY BE AUTOMATICALLY
EXCHANGED FOR EXCESS SHARES AND DEEMED TRANSFERRED TO A SPECIAL TRUST AS
PROVIDED IN THE ARTICLES OF INCORPORATION."
The Manager acknowledges and agrees that the certificates in
respect of the Conversion Stock shall bear the following additional
legend.
"THE COMMON SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS ON OWNERSHIP AND TRANSFER FOR THE PURPOSE OF THE CORPORATION'S
MAINTENANCE OF ITS STATUS AS A REAL ESTATE INVESTMENT TRUST UNDER THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED. NO INDIVIDUAL MAY BENEFICIALLY
OWN SHARES IN EXCESS OF THE THEN APPLICABLE OWNERSHIP LIMIT, WHICH MAY
DECREASE OR INCREASE FROM TIME TO TIME, UNLESS SUCH INDIVIDUAL IS AN
EXISTING HOLDER. IN GENERAL, ANY INDIVIDUAL WHO ATTEMPTS TO BENEFICIALLY
OWN SHARES IN EXCESS OF THE OWNERSHIP LIMIT MUST IMMEDIATELY NOTIFY THE
CORPORATION. ALL CAPITALIZED TERMS USED IN THIS LEGEND HAVE THE MEANINGS
SET FORTH IN THE ARTICLES OF INCORPORATION, A COPY OF WHICH, INCLUDING THE
RESTRICTIONS ON OWNERSHIP AND TRANSFER, WILL BE SENT WITHOUT CHARGE TO EACH
SHAREHOLDER WHO SO REQUESTS. IF THE RESTRICTIONS ON OWNERSHIP AND TRANSFER
ARE VIOLATED, THE COMMON SHARES REPRESENTED HEREBY MAY BE AUTOMATICALLY
EXCHANGED FOR EXCESS SHARES AND DEEMED TRANSFERRED TO A SPECIAL TRUST AS
PROVIDED IN THE ARTICLES OF INCORPORATION."
6. COVENANTS.
(a) COVENANTS OF THE COMPANY. The Company hereby covenants to
submit to a shareholder vote at its 1999 Annual Meeting (the "1999 ANNUAL
MEETING") or at a special shareholder meeting held prior to such time, the
question of whether the Series D Preferred Stock shall be convertible into
common stock, par value $0.01 of the Company (the "PROPOSITION").
(b) COVENANTS BY MANAGER.
WAT UNITHOLDER MEETING. The Manager hereby agrees to convene a
meeting of unitholders of WAT for the purpose of seeking UnitHolder
Approval as soon as practicable, but in no event later than August 1,
1998.
(c) COVENANTS BY THE TRUSTEE. 1999 ANNUAL MEETING. Subject to
the receipt by the Trustee of a legal opinion stating that the Trustee may
vote at such meeting, the Trustee agrees to attend, in person or by proxy,
the 1999 Annual Meeting or any special shareholder meeting held prior to
such time, and to vote upon the Proposition.
7. CONDITIONS.
(a) CONDITIONS TO THE OBLIGATIONS OF THE TRUSTEE. The obligation
of the Trustee to purchase the Shares at the Closing is subject to the
satisfaction or waiver at or prior to the Closing Date of the following
conditions:
(i) UnitHolder Approval;
(ii) The representations and warranties of the Company contained
in this Agreement shall be true and correct in all material respects at
and as of the date hereof, and true and correct in all material respects
at and as of the Closing Date as if made at and as of such time;
(iii) No Bankruptcy Event or Acceleration Event with respect to
the Company shall have occurred and be continuing, and the Trustee shall
have received a certificate of the president or a co-president, chief
financial officer or a vice president of the Company, dated as of the
Closing Date, to the effect that no such Bankruptcy Event or Acceleration
Event has occurred and is continuing (in each case, subject to clause (y)
of the definition of "Acceleration Event").
A "BANKRUPTCY EVENT" shall occur with respect to the Company if
(X) a court of appropriate jurisdiction enters an order or decree under
any Bankruptcy Law that (A) is for relief against the Company in an
involuntary case, (B) appoints a Receiver of the Company or for all or
substantially all of its property or (C) orders the liquidation of the
Company; or (Y) the Company pursuant to or within the meaning of any
Bankruptcy Law (A) commences a voluntary case, (B) consents to the entry
of an order for relief in an involuntary case, (C) consents to the
appointment of a Receiver of it or for all or substantially all of its
property, or (D) makes a general assignment for the benefit of its
creditors.
An "ACCELERATION EVENT" shall occur with respect to the Company
if theCompany defaults under the terms of any agreement or instrument
evidencing or under which the Company has at the date of this Agreement or
hereafter outstanding any Senior Indebtedness that is full recourse to the
Company and such Senior Indebtedness shall be accelerated so that the same
shall be or become due and payable prior to the date on which the same
would otherwise become due and payable and the aggregate principal amount
thereof so accelerated exceeds U.S.$150,000,000 and such acceleration is
not rescinded or annulled within 90 Business Days; PROVIDED, HOWEVER, that
(X) if such default under such agreement or instrument is remedied or
cured by the Company or waived by the holders of such Senior Indebtedness,
then the Acceleration Event hereunder by reason thereof shall be deemed
likewise to have been thereupon remedied, cured or waived or (Y) if the
Company provides to the Trustee a certificate of the president or a
co-president, chief financial officer or a vice president of the Company
to the effect that the Company holds sufficient funds, or has sufficient
availability under its credit facilities, to discharge such Senior
Indebtedness, then for all purposes of this Agreement the Acceleration
Event shall be deemed not to have occurred.
For the purposes of this Section 6:
"BANKRUPTCY LAW" means Title 11, U.S. Code, or any similar
federal or state law for the relief of debtors.
"BUSINESS DAY" means any day other than a Saturday, Sunday or a
day on which banking institutions in New York are authorized or obligated
by law or executive order to close.
"INDEBTEDNESS" means (I) the principal obligations of the
Company for borrowed money (other than (X) the deferred purchase price of
property or services and (Y) indebtedness to trade creditors and service
providers incurred in the ordinary course of business) and (II) the
principal obligations of the Company evidenced by bonds, notes, debentures
or other similar instruments.
"RECEIVER" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
"SENIOR INDEBTEDNESS" means any Indebtedness of the Company that
is not subordinated in right of payment to any other Indebtedness of the
Company.
(iv) The Company shall have performed in all material respects
its obligations under this Agreement required to be performed by it at or
prior to the Closing Date pursuant to the terms hereof;
(v) The closing under the Series C Preferred Stock Purchase
Agreement shall be occurring simultaneously with the Closing of the
Shares.
(b) CONDITIONS TO THE OBLIGATIONS OF THE COMPANY. The obligation
of the Company to sell the Shares at the Closing is subject to the
satisfaction or waiver at or prior to the Closing Date of the following
conditions:
(i) The representations and warranties of the Manager and the
Trustee contained in this Agreement shall be true and correct in all
material respects at and as of the date hereof, and true and correct
in all material respects at and as of the Closing Date as if made at
and as of such time; and
(ii) Each of the Trustee and the Manager shall have performed in
all material respects its obligations under this Agreement required
to be performed by it at or prior to the Closing Date pursuant to the
terms hereof.
8. CONDITIONS TO EFFECTIVENESS.
(a) This Agreement shall not be binding on any party hereto and
is to have no legal effect unless and until the Manager of WAT allots and
issues 82.2 million units on June 30, 1998 pursuant to the underwriting
agreement entered into concurrently with this Agreement with SBC Warburg
Dillon Read Australia Limited.
(b) The Trustee shall have no obligation to purchase the Shares
until the Trustee receives all of the following opinions in a form
reasonably acceptable to the Trustee: an Australian legal opinion and
United States legal opinion, an Australian taxation opinion and a United
States tax opinion.
9. MAINTENANCE OF REIT STATUS.
(a) So long as the Trustee on behalf of WAT owns any of the
Shares of Series D Preferred Stock, the Company will continue to be taxed
as a real estate investment trust pursuant to Sections 856 through 860 of
the Code.
(b) If the Company shall fail to continue to be taxed as a real
estate investment trust pursuant to Sections 856 through 860 of the Code
(a "REIT-TERMINATION EVENT"), the Trustee on behalf of WAT shall have the
right to require the Company, to the extent the Company shall have funds
legally available therefor, to repurchase any or all of the Series D
Preferred Shares held by the Trustee on behalf of WAT at a repurchase
price payable in cash (the "REIT-REPURCHASE PAYMENT") in an amount equal
to 115% of the Liquidation Preference (as defined in the Series D
Certificate of Designation) thereof, plus accrued and unpaid dividends
whether or not declared, if any to the date of repurchase or the date
payment is made available (the "REIT-REPURCHASE DATE").
(c) Within 15 days following the Company becoming aware that a
REIT-Termination Event has occurred, the Corporation shall mail by first
class mail or recognized overnight courier a notice to the Trustee and the
Manager stating (A) that a REIT-Termination Event has occurred and that
the Trustee on behalf of WAT has the right to require the Company to
repurchase any or all of the Series D Preferred Shares then held by the
Trustee on behalf of WAT, (B) the date of repurchase (which shall be a
Business Day (as defined in the Series D Certificate of Designation), no
earlier than 30 days and no later than 60 days from the date such notice
is mailed, or such later date as may be necessary to comply with the
requirements of the Securities Exchange Act of 1934, as amended), (C) the
repurchase price and (D) the instructions determined by the Company,
consistent with this subsection, that the Trustee must follow in order to
have the Series D Preferred Shares repurchased.
(d) On the REIT-Repurchase Date, the Company, to the extent
lawful, shall accept for payment Series D Preferred Shares or portions
thereof tendered by the holders thereof pursuant to the REIT-Repurchase
Offer and promptly, by wire transfer of immediately available funds to
such holders, as directed by such holders, send an amount equal to the
REIT-Repurchase Payment in respect of all Series D Preferred Shares, or
portions thereof so tendered.
(e) Notwithstanding anything else herein, to the extent they are
applicable to any REIT-Repurchase Offer, the Company will comply with any
federal and state securities laws, rules and regulations and all time
periods and requirements shall be adjusted accordingly.
10. TRUSTEE'S LIMITATION OF LIABILITY.
(a) The Trustee enters into this Agreement only in its capacity
as trustee of WAT and in no other capacity. Any liability arising under or
in connection with this Agreement will be limited to, and can be enforced
against the Trustee only to the extent to which such liability can be
satisfied out of, the property or assets of WAT from which the Trustee is
actually indemnified for such liability. This limitation of the Trustee's
liability under this Agreement will apply despite any other provision of
this Agreement and extends to all liabilities and obligations of the
Trustee in any way related to any representation, warranty, conduct,
omission, agreement or transaction related to this Agreement, subject to
paragraph (c)(i) of this Section 10.
(b) Neither the Company nor the Manager may sue the Trustee in
any capacity other than as trustee of WAT, including to seek the
appointment of a receiver (except in relation to the property or assets of
WAT), a liquidator, an administrator or any similar person with respect to
the Trustee or to prove in any liquidation, administration or arrangement
of or affecting the Trustee (except in relation to the property or assets
of WAT), subject to paragraph (c)(i) of this Section 10.
(c) Notwithstanding the foregoing paragraphs (a) and (b), the
provisions of this Section 10 shall not: (i) apply to any obligation or
liability of the Trustee to the extent that it is not satisfied because
under the Trust Deed establishing WAT or by operation of law there is a
reduction in the extent of the Trustee's indemnification out of the
property or assets of WAT as a result of the Trustee's fraud, negligence
or breach of trust; or (ii) in any way limit the right of the Company to
bring any action or proceeding for the performance by the Trustee (in its
capacity as trustee of WAT) or the Manager of any of their respective
obligations under this Agreement or the Company's right to recover damages
from the property or assets of WAT.
11. MISCELLANEOUS.
(a) NOTICES. All notices and other communications made in
connection with this Agreement shall be in writing and shall be (A) sent
by facsimile, with a copy mailed by first-class, registered or certified
mail, return receipt requested, postage prepaid, or (B) transmitted by
hand delivery, addressed as follows (or at such other address as may be
specified in writing to the other party hereto):
(i) if to the Company, to:
Westfield America, Inc.
11601 Wilshire Boulevard
Los Angeles, California 90025
Telecopy: 310-478-8776
Attention: Irv Hepner, Secretary
(ii) if to the Manager, to:
Westfield America Management Limited
Level 24 Westfield Towers
100 William Street
Sydney NSW 2011 Australia
Telecopy: 011 612 93587077
Attention: Craig Van der Laan, Secretary
(iii) if to the Trustee, to:
Perpetual Trustee Company Limited
39 Hunter Street
Sydney NSW 2000 Australia
Telecopy: 011 612 92315606
Attention: Allan Cowper, National Manager-
Property Trusts
All such notices and communications shall be deemed to have been
received on the date of delivery.
(b) BINDING EFFECT; BENEFITS, ETC. This Agreement shall be
binding upon and inure to the benefit of the parties to this Agreement and
their respective successors and assigns. Nothing in this Agreement,
express or implied, is intended or shall be construed to give any person
other than the parties to this Agreement or their respective successors or
assigns any benefit or any legal or equitable right, remedy or claim under
or in respect of any agreement or any provision contained herein.
(c) WAIVER; AMENDMENT. (i) WAIVER. No amendment, modification or
discharge of this Agreement, and no waiver hereunder, shall be valid or
binding unless set forth in writing and duly executed by the party against
whom enforcement of the amendment, modification, discharge or waiver is
sought. Any such waiver or instance shall constitute a waiver,
modification or discharge, as the case may be, only with respect to the
specific matter described in such writing and shall in no way impair the
rights of the party granting such waiver in any other respect or at any
other time.
(ii) AMENDMENT. This Agreement may be amended, modified or
supplemented only by a written instrument executed by the Company, the
Trustee and the Manager.
(d) ASSIGNABILITY. Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by the Company, the Manager or the Trustee without the prior
written consent of the other parties.
(e) SEPARABILITY. In case any provision in this Agreement shall
be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
(f) GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES
THEREOF, OTHER THAN ANY MANDATING THE APPLICATION OF SUCH LAWS).
The Company, the Trustee and the Manager each irrevocably
submits to the non-exclusive jurisdiction of any New York State or United
States Federal court sitting in the City of New York over any suit, action
or proceeding arising out of or relating to this Agreement. The Company,
the Trustee and the Manager each irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in any such court and
any claim that any such proceeding brought in such court has been brought
in an inconvenient forum. The Company, the Trustee and the Manager each
agree that final judgment in any such suit, action or proceeding brought
in such a court shall be conclusive and binding on it and may be enforced
in any court to the jurisdiction of which it is subject by a suit upon
such judgment. The Company, the Trustee and the Manager each hereby
irrevocably consent to service of copies of the summonses and complaints
and any other process. Such service may be made by mailing or delivering a
copy of such process to their respective addresses set forth above or by
any other means provided for by applicable law.
(g) SECTION AND OTHER HEADINGS, ETC. The section and other
headings contained in this Agreement are for reference purposes only and
shall not affect the meaning or interpretation of this Agreement.
(h) COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original and all
of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Company, the Manager and the Trustee have
duly executed this WAT Subscription Agreement by their authorized
representatives as of the date first above written.
WESTFIELD AMERICA, INC.
By:/s/ Peter S. Lowy
-----------------
Name: Peter S. Lowy
Title: Co-President
WESTFIELD AMERICA MANAGEMENT LIMITED, As
Manager of Westfield America Trust
By:/s/ Craig Van Der Laan De Vries
-------------------------------
Name: Craig van der Laan de Vries
Title: Attorney Appointed under Power
of Attorney date 25 June 1998
PERPETUAL TRUSTEE COMPANY LIMITED, As
Trustee of Westfield America Trust
By:/s/ Allan Cowper
----------------
Name: Allan Cowper
Title: National Manager Property
Trusts
WAT SUBSCRIPTION AGREEMENT
WAT SUBSCRIPTION AGREEMENT, dated as of December 17, 1998,
between Westfield America, Inc.(ARBN 082 554 541), a Missouri corporation
(the "Company"), Perpetual Trustee Company Limited (ACN 000 001 007), an
Australian company (the "Trustee"), and Westfield America Management
Limited (ACN 072 780 619), an Australian company (the "Manager").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the Trust Deed, dated March 28, 1996,
as amended (the "Trust Deed"), between the Trustee and the Manager,
Westfield America Trust, an Australian public property trust ("WAT"), was
created; and the Trustee and the Manager have authority to act on behalf of
WAT under the Trust Deed;
WHEREAS, the Manager has directed the Trustee on behalf of
WAT to subscribe for and purchase, and the Company desires to sell to the
Trustee on behalf of WAT, 138,889 shares (the "Shares") of Series D-1
Cumulative Convertible Redeemable Preferred Stock of the Company, par value
$1.00 (the "Series D-1 Preferred Stock"), subject to the terms and
conditions contained herein.
NOW, THEREFORE, to implement the foregoing and in
consideration of the mutual agreements contained herein, the parties hereto
hereby agree as follows:
1. Purchase and Sale of the Shares. Subject to all of the
terms and conditions of this Agreement, the Company agrees to sell and the
Trustee on behalf of WAT agrees to purchase the Shares on the Closing Date
(as defined in Section 2) for consideration as provided in Section 2(b).
The Shares shall have the rights set forth in the Certificate of
Designation relating to the Series D-1 Preferred Stock, substantially in
the form attached as Exhibit A hereto (the "Series D-1 Certificate").
2. Closing.
-------
(a) Time and Place. Subject to the satisfaction of
the conditions contained herein, the closing
of the sale of the Shares (the "Closing")
shall take place on a date mutually agreed
upon by the parties hereto (the "Closing
Date"). The Closing shall occur at the offices
of Westfield America Inc., 11601 Wilshire
Boulevard, 12th Floor, Los Angeles, California
90025.
(b) Delivery by the Trustee. At the Closing, the
Trustee shall deliver $25,000,020 to the
Company by wire transfer of immediately
available funds to the following account:
Account Name: Westfield America
Limited Partnership
Account Number: 1420203965
Bank Name: Bank of America
Routing ABA Number: 121000358
(c) Delivery by the Company. At the Closing, the
Company shall deliver to the Trustee on behalf
of WAT, a stock certificate registered in the
Trustee's name and representing the Shares.
3. Representations and Warranties of the Company. The
Company hereby represents and warrants to the Trustee as follows:
(a) Authorization. The Company has full power and
authority to execute and deliver this
Agreement and to consummate the transactions
contemplated hereby in accordance with the
terms hereof. The execution and delivery of
this Agreement and the consummation of the
transactions contemplated hereby have been or
will be duly authorized by the Company.
(b) The Shares. The Shares, to be delivered by the
Company at the Closing, as of the Closing
Date, will have been duly authorized for
issuance and, when delivered in accordance
with this Agreement, will be validly issued,
fully paid and non-assessable.
(c) Series C-1 Preferred Stock Purchase Agreement.
The representations and warranties of the
Company contained in the Series C-1 Preferred
Stock Purchase Agreement, dated as of the date
hereof, among the Company, Westfield America
Limited Partnership and Security Capital
Preferred Growth Incorporated (the "Series C-1
Purchase Agreement") are true and correct in
all material respects.
4. Representations and Warranties of Trustee and Manager.
The Manager and the Trustee hereby represent and warrant to the Company as
follows:
(a) Authorization. Each of the Trustee and the
Manager has full power and authority to
execute and deliver this Agreement and to
consummate the transactions contemplated
hereby in accordance with the terms hereof and
on behalf of WAT. The execution and delivery
of this Agreement and the consummation of the
transactions contemplated hereby have been
duly authorized by or on behalf of each of the
Trustee and the Manager.
(b) Acquisition for Investment.
(i) The Trustee is acquiring the Shares in
its capacity as Trustee of WAT for
investment on behalf of WAT and not
with a view to or for sale in
connection with any distribution
thereof, and WAT has no present
intention or plan to effect any
distribution thereof within the meaning
of the Securities Act of 1933, as
amended (the "Securities Act"). The
Trustee and the Manager have received
copies of the Company's Report on Form
10-K for the year ended December 31,
1997, the reports filed with the
Securities and Exchange Commission
since December 31, 1997, pursuant to
Section 13 of the Securities Exchange
Act of 1934, as amended, and the
Company's Registration Statement on
Form S-3 (File No. 333-52977), as filed
with the Commission on June 1, 1998
(collectively, the "Disclosure
Documents"). The Trustee and the
Manager have been furnished the
opportunity to ask questions of and
receive answers from representatives of
the Company concerning the Disclosure
Documents and the business and
financial affairs of the Company.
(ii) The Trustee and the Manager understand
that the Shares and the common stock to
be issued upon conversion thereof (the
"Conversion Stock") have not been
registered under the Securities Act or
applicable state securities laws and
agree not to sell, pledge or otherwise
transfer any of the Shares or
Conversion Stock in the absence of such
registration or an opinion of counsel
reasonably satisfactory to the Company
that such registration is not required.
The Trustee and the Manager acknowledge
that the Company is not required to
register the Shares or the Conversion
Stock.
5. Legends. The Manager acknowledges and agrees that any
certificates evidencing the Series D-1 Preferred Stock purchased pursuant
to this Agreement and the Conversion Stock issuable upon conversion thereof
shall be stamped or endorsed with legends in substantially the following
form and shall be subject to the provisions of such legends:
"THE SECURITY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT
BE OFFERED, SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
OR AN EXEMPTION THEREFROM AND AS SET FORTH HEREIN.
THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT
OF THE ISSUER THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED, ONLY (1) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (2) IN A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO (i) THE RECEIPT BY THE ISSUER OF AN
OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE ISSUER THAT SUCH
REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, AND (ii) THE RECEIPT BY THE ISSUER OF SUCH OTHER
EVIDENCE REASONABLY ACCEPTABLE TO THE ISSUER THAT SUCH REOFFER,
RESALE, PLEDGE OR OTHER TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS, (3) TO THE ISSUER, ITS
AFFILIATES, AND (4) IN THE CASE OF A TRANSFER UNDER (1), (2) OR (3)
IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE
HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER FROM IT OF THIS SECURITY OF THE RESALE RESTRICTIONS SET
FORTH IN (A) ABOVE."
The Manager acknowledges and agrees that each certificate in
respect of the Series D-1 Preferred Stock shall bear the following
additional legend:
"THE PREFERRED SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT
TO RESTRICTIONS ON OWNERSHIP AND TRANSFER FOR THE PURPOSE OF THE
CORPORATION'S MAINTENANCE OF ITS STATUS AS A REAL ESTATE INVESTMENT
TRUST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. NO
INDIVIDUAL MAY BENEFICIALLY OWN SHARES IN EXCESS OF THE THEN
APPLICABLE OWNERSHIP LIMIT, WHICH MAY DECREASE OR INCREASE FROM
TIME TO TIME, UNLESS SUCH INDIVIDUAL IS AN EXISTING HOLDER. IN
GENERAL, ANY INDIVIDUAL WHO ATTEMPTS TO BENEFICIALLY OWN SHARES IN
EXCESS OF THE OWNERSHIP LIMIT MUST IMMEDIATELY NOTIFY THE
CORPORATION. ALL CAPITALIZED TERMS USED IN THIS LEGEND HAVE THE
MEANINGS SET FORTH IN THE RESTATED ARTICLES OF INCORPORATION, A
COPY OF WHICH, INCLUDING THE RESTRICTIONS ON OWNERSHIP AND
TRANSFER, WILL BE SENT WITHOUT CHARGE TO EACH SHAREHOLDER WHO SO
REQUESTS. IF THE RESTRICTIONS ON OWNERSHIP AND TRANSFER ARE
VIOLATED, THE PREFERRED SHARES REPRESENTED HEREBY MAY BE
AUTOMATICALLY EXCHANGED FOR EXCESS SHARES AND DEEMED TRANSFERRED TO
A SPECIAL TRUST AS PROVIDED IN THE RESTATED ARTICLES OF
INCORPORATION."
The Manager acknowledges and agrees that the certificates in
respect of the Conversion Stock shall bear the following additional legend.
"THE COMMON SHARES REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS ON OWNERSHIP AND TRANSFER FOR THE PURPOSE
OF THE CORPORATION'S MAINTENANCE OF ITS STATUS AS A REAL ESTATE
INVESTMENT TRUST UNDER THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED. NO INDIVIDUAL MAY BENEFICIALLY OWN SHARES IN EXCESS OF THE
THEN APPLICABLE OWNERSHIP LIMIT, WHICH MAY DECREASE OR INCREASE
FROM TIME TO TIME, UNLESS SUCH INDIVIDUAL IS AN EXISTING HOLDER. IN
GENERAL, ANY INDIVIDUAL WHO ATTEMPTS TO BENEFICIALLY OWN SHARES IN
EXCESS OF THE OWNERSHIP LIMIT MUST IMMEDIATELY NOTIFY THE
CORPORATION. ALL CAPITALIZED TERMS USED IN THIS LEGEND HAVE THE
MEANINGS SET FORTH IN THE RESTATED ARTICLES OF INCORPORATION, A
COPY OF WHICH, INCLUDING THE RESTRICTIONS ON OWNERSHIP AND
TRANSFER, WILL BE SENT WITHOUT CHARGE TO EACH SHAREHOLDER WHO SO
REQUESTS. IF THE RESTRICTIONS ON OWNERSHIP AND TRANSFER ARE
VIOLATED, THE COMMON SHARES REPRESENTED HEREBY MAY BE AUTOMATICALLY
EXCHANGED FOR EXCESS SHARES AND DEEMED TRANSFERRED TO A SPECIAL
TRUST AS PROVIDED IN THE RESTATED ARTICLES OF INCORPORATION.
6. Covenants.
(a) Covenants of the Company. The Company hereby
covenants to submit to a shareholder vote at
its 1999 Annual Meeting (the "1999 Annual
Meeting") or at a special shareholder meeting
held prior to such time, the question of
whether the Series D-1 Preferred Stock shall
be convertible into common stock, par value
$0.01 of the Company (the "Proposition").
(b) Covenants by the Trustee. The Trustee agrees
to attend, in person or by proxy, the 1999
Annual Meeting or any special shareholder
meeting held prior to such time, and to vote
upon the Proposition.
7. Conditions.
(a) Conditions to the Obligations of the Trustee.
The obligation of the Trustee to purchase the
Shares at the Closing is subject to the
satisfaction or waiver at or prior to the
Closing Date of the following conditions:
(i) The representations and warranties of
the Company contained in this Agreement
shall be true and correct in all
material respects at and as of the date
hereof, and true and correct in all
material respects at and as of the
Closing Date as if made at and as of
such time;
(ii) No Bankruptcy Event or Acceleration
Event with respect to the Company shall
have occurred and be continuing, and
the Trustee shall have received a
certificate of a Co- President, Chief
Financial Officer or the Secretary of
the Company, dated as of the Closing
Date, to the effect that no such
Bankruptcy Event or Acceleration Event
has occurred and is continuing (in each
case, subject to clause (y) of the
definition of "Acceleration Event").
A "Bankruptcy Event" shall occur with respect to the Company
if (x) a court of appropriate jurisdiction enters an order or
decree under any Bankruptcy Law that (A) is for relief against the
Company in an involuntary case, (B) appoints a Receiver of the
Company or for all or substantially all of its property or (C)
orders the liquidation of the Company; or (y) the Company pursuant
to or within the meaning of any Bankruptcy Law (A) commences a
voluntary case, (B) consents to the entry of an order for relief in
an involuntary case, (C) consents to the appointment of a Receiver
of it or for all or substantially all of its property, or (D) makes
a general assignment for the benefit of its creditors.
An "Acceleration Event" shall occur with respect to the
Company if the Company defaults under the terms of any agreement or
instrument evidencing or under which the Company has at the date of
this Agreement or hereafter outstanding any Senior Indebtedness
that is full recourse to the Company and such Senior Indebtedness
shall be accelerated so that the same shall be or become due and
payable prior to the date on which the same would otherwise become
due and payable and the aggregate principal amount thereof so
accelerated exceeds U.S.$150,000,000 and such acceleration is not
rescinded or annulled within 90 Business Days; provided, however,
that (x) if such default under such agreement or instrument is
remedied or cured by the Company or waived by the holders of such
Senior Indebtedness, then the Acceleration Event hereunder by
reason thereof shall be deemed likewise to have been thereupon
remedied, cured or waived or (y) if the Company provides to the
Trustee a certificate of the president or a co-president, chief
financial officer or a vice president of the Company to the effect
that the Company holds sufficient funds, or has sufficient
availability under its credit facilities, to discharge such Senior
Indebtedness, then for all purposes of this Agreement the
Acceleration Event shall be deemed not to have occurred.
For the purposes of this Section 7:
"Bankruptcy Law" means Title 11, U.S. Code, or any similar
federal or state law for the relief of debtors.
"Business Day" means any day other than a Saturday, Sunday
or a day on which banking institutions in New York are authorized
or obligated by law or executive order to close.
"Indebtedness" means (i) the principal obligations of the
Company for borrowed money (other than (x) the deferred purchase
price of property or services and (y) indebtedness to trade
creditors and service providers incurred in the ordinary course of
business) and (ii) the principal obligations of the Company
evidenced by bonds, notes, debentures or other similar instruments.
"Receiver" means any receiver, trustee, assignee, liquidator
or similar official under any Bankruptcy Law.
"Senior Indebtedness" means any Indebtedness of the Company
that is not subordinated in right of payment to any other
Indebtedness of the Company.
(iii) The Company shall have performed in all
material respects its obligations under
this Agreement required to be performed
by it at or prior to the Closing Date
pursuant to the terms hereof;
(iv) The closing under the Series C-1
Purchase Agreement shall be occurring
simultaneously with the Closing of the
issuance and sale of the Shares.
(b) Conditions to the Obligations of the Company.
The obligation of the Company to sell the
Shares at the Closing is subject to the
satisfaction or waiver at or prior to the
Closing Date of the following conditions:
(i) The representations and warranties of
the Manager and the Trustee contained
in this Agreement shall be true and
correct in all material respects at and
as of the date hereof, and true and
correct in all material respects at and
as of the Closing Date as if made at
and as of such time; and
(ii) Each of the Trustee and the Manager
shall have performed in all material
respects its obligations under this
Agreement required to be performed by
it at or prior to the Closing Date
pursuant to the terms hereof.
8. Conditions to Effectiveness. The Trustee shall have no
obligation to purchase the Shares until the Trustee receives all of the
following opinions in a form reasonably acceptable to the Trustee: an
Australian legal opinion and United States legal opinion, an Australian
taxation opinion and a United States tax opinion.
9. Maintenance of REIT Status.
(a) So long as the Trustee on behalf of WAT owns
any of the Shares of Series D-1 Preferred
Stock, the Company will continue to be taxed
as a real estate investment trust pursuant to
Sections 856 through 860 of the Code.
(b) If the Company shall fail to continue to be
taxed as a real estate investment trust
pursuant to Sections 856 through 860 of the
Code (a "REIT-Termination Event"), the Trustee
on behalf of WAT shall have the right to
require the Company, to the extent the Company
shall have funds legally available therefor,
to repurchase any or all of the Series D-1
Preferred Stock held by the Trustee on behalf
of WAT at a repurchase price payable in cash
(the "REIT-Repurchase Payment") in an amount
equal to 115% of the Liquidation Preference
(as defined in the Series D-1 Certificate)
thereof, plus accrued and unpaid dividends
whether or not declared, if any to the date of
repurchase or the date payment is made
available (the "REIT-Repurchase Date").
(c) Within 15 days following the Company becoming
aware that a REIT-Termination Event has
occurred, the Corporation shall mail by first
class mail or recognized overnight courier a
notice to the Trustee and the Manager stating
(A) that a REIT-Termination Event has occurred
and that the Trustee on behalf of WAT has the
right to require the Company to repurchase any
or all of the Series D-1 Preferred Shares then
held by the Trustee on behalf of WAT, (B) the
date of repurchase (which shall be a Business
Day (as defined in the Series D-1
Certificate), no earlier than 30 days and no
later than 60 days from the date such notice
is mailed, or such later date as may be
necessary to comply with the requirements of
the Securities Exchange Act of 1934, as
amended), (C) the repurchase price and (D) the
instructions determined by the Company,
consistent with this subsection, that the
Trustee must follow in order to have the
Series D-1 Preferred Shares repurchased.
(d) On the REIT-Repurchase Date, the Company, to
the extent lawful, shall accept for payment
Series D-1 Preferred Stock or portions thereof
tendered by the holders thereof pursuant to
the REIT- Repurchase Offer and promptly, by
wire transfer of immediately available funds
to such holders, as directed by such holders,
send an amount equal to the REIT-Repurchase
Payment in respect of all Series D-1 Preferred
Stock, or portions thereof so tendered.
(e) Notwithstanding anything else herein to the
contrary, to the extent they are applicable to
any REIT-Repurchase Offer, the Company will
comply with any federal and state securities
laws, rules and regulations and all time
periods and requirements shall be adjusted
accordingly.
10. Trustee's Limitation of Liability.
(a) The Trustee enters into this Agreement only in
its capacity as trustee of WAT and in no other
capacity. Any liability arising under or in
connection with this Agreement will be limited
to, and can be enforced against the Trustee
only to the extent to which such liability can
be satisfied out of, the property or assets of
WAT from which the Trustee is actually
indemnified for such liability. This
limitation of the Trustee's liability under
this Agreement will apply despite any other
provision of this Agreement and extends to all
liabilities and obligations of the Trustee in
any way related to any representation,
warranty, conduct, omission, agreement or
transaction related to this Agreement, subject
to paragraph (c)(i) of this Section 10.
(b) Neither the Company nor the Manager may sue
the Trustee in any capacity other than as
trustee of WAT, including to seek the
appointment of a receiver (except in relation
to the property or assets of WAT), a
liquidator, an administrator or any similar
person with respect to the Trustee or to prove
in any liquidation, administration or
arrangement of or affecting the Trustee
(except in relation to the property or assets
of WAT), subject to paragraph (c)(i) of this
Section 10.
(c) Notwithstanding the foregoing paragraphs (a)
and (b), the provisions of this Section 10
shall not: (i) apply to any obligation or
liability of the Trustee to the extent that it
is not satisfied because under the Trust Deed
establishing WAT or by operation of law there
is a reduction in the extent of the Trustee's
indemnification out of the property or assets
of WAT as a result of the Trustee's fraud,
negligence or breach of trust; or (ii) in any
way limit the right of the Company to bring
any action or proceeding for the performance
by the Trustee (in its capacity as trustee of
WAT) or the Manager of any of their respective
obligations under this Agreement or the
Company's right to recover damages from the
property or assets of WAT.
11. Dividends. The Trustee and the Manager hereby
acknowledge and agree that the Company will pay the dividends due and
payable on the Series D-1 Preferred Shares for the quarter ended December
31, 1998 concurrently with the dividends due and payable for the quarter
ended March 31, 1999.
12. Miscellaneous.
(a) Notices. All notices and other communications
made in connection with this Agreement shall
be in writing and shall be (i) sent by
facsimile, with a copy mailed by first-class,
registered or certified mail, return receipt
requested, postage prepaid, or (ii)
transmitted by hand delivery, addressed as
follows (or at such other address as may be
specified in writing to the other party
hereto):
(i) if to the Company, to:
Westfield America, Inc.
11601 Wilshire Boulevard
Los Angeles, California 90025
Telecopy: 310-478-8776
Attention: Irv Hepner, Secretary
with a copy to:
Skadden, Arps, Slate, Meagher & Flom LLP
300 South Grand Avenue, Suite 3400
Los Angeles, California 90071
Telecopy: 213-687-5600
Attention: Gregg A. Noel, Esq.
(ii) if to the Manager, to:
Westfield America Management Limited
Level 24 Westfield Towers
100 William Street
Sydney NSW 2011 Australia
Telecopy: 011 612 93587077
Attention: Craig Van der Laan, Secretary
(iii) if to the Trustee, to:
Perpetual Trustee Company Limited
39 Hunter Street
Sydney NSW 2000 Australia
Telecopy: 011 612 92315606
Attention: Allan Cowper,
National Manager-Property Trusts
All such notices and communications shall be deemed to have
been received on the date of delivery.
(b) Binding Effect; Benefits, Etc. This Agreement
shall be binding upon and inure to the benefit
of the parties to this Agreement and their
respective successors and assigns. Nothing in
this Agreement, express or implied, is
intended or shall be construed to give any
person other than the parties to this
Agreement or their respective successors or
assigns any benefit or any legal or equitable
right, remedy or claim under or in respect of
any agreement or any provision contained
herein.
(c) Waiver; Amendment.
(i) Waiver. No amendment, modification or
discharge of this Agreement, and no
waiver hereunder, shall be valid or
binding unless set forth in writing and
duly executed by the party against whom
enforcement of the amendment,
modification, discharge or waiver is
sought. Any such waiver or instance
shall constitute a waiver, modification
or discharge, as the case may be, only
with respect to the specific matter
described in such writing and shall in
no way impair the rights of the party
granting such waiver in any other
respect or at any other time.
(ii) Amendment. This Agreement may be
amended, modified or supplemented only
by a written instrument executed by the
Company, the Trustee and the Manager.
(d) Assignability. Neither this Agreement nor any
right, remedy, obligation or liability arising
hereunder or by reason hereof shall be
assignable by the Company, the Manager or the
Trustee without the prior written consent of
the other parties.
(e) Separability. In case any provision in this
Agreement shall be invalid, illegal or
unenforceable, the validity, legality and
enforceability of the remaining provisions
shall not in any way be affected or impaired
thereby.
(f) Governing Law; Consent to Jurisdiction. THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK. INCLUDING WITHOUT LIMITATION,
SECTIONS 5- 1401 AND 5-1402 OF THE NEW YORK
GENERAL OBLIGATION LAW AND NEW YORK CIVIL
PRACTICE LAWS AND RULES 327(b).
The Company, the Trustee and the Manager each irrevocably
submits to the non- exclusive jurisdiction of any New York State or United
States federal court sitting in the City of New York over any suit, action
or proceeding arising out of or relating to this Agreement. The Company,
the Trustee and the Manager each irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in any such court and
any claim that any such proceeding brought in such court has been brought
in an inconvenient forum. The Company, the Trustee and the Manager each
agree that final judgment in any such suit, action or proceeding brought in
such a court shall be conclusive and binding on it and may be enforced in
any court to the jurisdiction of which it is subject by a suit upon such
judgment. The Company, the Trustee and the Manager each hereby irrevocably
consent to service of copies of the summonses and complaints and any other
process. Such service may be made by mailing or delivering a copy of such
process to their respective addresses set forth above or by any other means
provided for by applicable law.
(g) Section and Other Headings, etc. The section
and other headings contained in this Agreement
are for reference purposes only and shall not
affect the meaning or interpretation of this
Agreement.
(h) Counterparts. This Agreement may be executed
in any number of counterparts, each of which
shall be deemed to be an original and all of
which together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the Company, the Manager and the Trustee
have duly executed this WAT Subscription Agreement by their authorized
representatives as of the date first above written.
WESTFIELD AMERICA, INC.
By: /s/ Peter S. Lowy
--------------------------------------
Name: Peter S. Lowy
Title: Co-President
WESTFIELD AMERICA MANAGEMENT
LIMITED,
As Manager of Westfield America Trust
By: /s/ Craig van der Laan de Vries
--------------------------------------
Name: Craig van der Laan de Vries
Title: Attorney Appointed under Power
of Attorney, dated 14 December
1998
PERPETUAL TRUSTEE COMPANY LIMITED,
As Trustee of Westfield America Trust
By: /s/ Allan Cowper
--------------------------------------
Name: Allan Cowper
Title: National Manager Property Trusts
CERTIFICATE OF DESIGNATION
SETTING FORTH "RESOLUTION DESIGNATING
SERIES D PREFERRED SHARES
AND FIXING PREFERENCES AND RIGHTS THEREOF"
ADOPTED BY THE BOARD OF DIRECTORS OF
WESTFIELD AMERICA, INC.
Pursuant to the Provisions of Section 351.180 (7) of the
General and Business Corporation Law of the State
of Missouri, as amended,
I, the undersigned, Co-President of Westfield America, Inc., a
Missouri corporation (hereinafter sometimes referred to as the
"Corporation"), hereby certify as follows:
FIRST: that under the provisions of Article Fourth of the Restated
Articles of Incorporation, as amended, of the Corporation, the total number
of shares of all classes of capital stock which the Corporation may issue
is 410,000,200 shares, of which (i) 200 shares shall be non-voting senior
preferred stock, par value $1.00 per share (the "Senior Preferred Shares"),
(ii) 5,000,000 shares shall be Preferred Shares, with par value of $1.00
per share (the "Preferred Shares"), 940,000 of which have been designated
as Series A Preferred Shares, with a liquidation value of $100 per share
(the "Series A Preferred Shares") and 400,000 of which have been designated
as Series B Preferred Shares, with a liquidation value of $100 per share
(the "Series B Preferred Shares"), (iii) 200,000,000 shall be shares of
common stock, par value $.01 per share (the "Common Shares"),
(iv) 205,000,000 will be shares of excess stock, par value $.01 ("Excess
Shares"). Any Excess Shares which are issued with respect to Common Stock
shall be "Excess Common Shares" and, together with the Common Shares, the
"Common Equity Shares" and any Excess Shares which are issued with respect
to Preferred Shares shall be "Excess Preferred Shares", and, together with
the Preferred Shares, the "Preferred Equity Shares" and under said Articles
of Incorporation (as amended, the "Articles of Incorporation"), the shares
of Preferred Stock are authorized to be issued by the Board of Directors
and the Board of Directors is expressly authorized to determine in the
Resolution, the designation, powers, rights, preferences and
qualifications, limitations or restrictions, not fixed and determined by
the Articles of Incorporation.
SECOND: That the Board of Directors of the Corporation pursuant to
the authority so vested in it by Article Fourth of the Certificate of
Incorporation, and in accordance with the provisions of Section 351.180 (7)
of the General and Business Corporation Law of the State of Missouri, as
amended, adopted on July 20, 1998 the following resolution creating a
series of Preferred Stock designated as "Series D Preferred Shares," which
resolution has not been amended, modified, rescinded or revoked and is in
full force and effect on the date hereof.
"RESOLUTION OF THE BOARD OF DIRECTORS OF
WESTFIELD AMERICA, INC. DESIGNATING
'SERIES D PREFERRED SHARES'
AND FIXING PREFERENCES AND RIGHTS THEREOF"
BE IT RESOLVED, that pursuant to authority expressly granted to and
vested in the Board of Directors of Westfield America, Inc., hereinafter
called the "Corporation," by the provisions of the Articles of
Incorporation, as amended, the Board of Directors of the Corporation hereby
fixes the designation, voting powers, rights on liquidation or dissolution
and other preferences and rights, and the qualifications, limitations or
restrictions thereof, of the shares of such series (in addition to the
designations, preferences and relative rights, and the qualifications,
limitations or restrictions thereof set forth in the Articles of
Incorporation which are applicable to the Series D Preferred Shares) as
follows:
Section 1. Number of Shares, Designation and Ranking. This class of
preferred stock shall be designated as Series D Cumulative Convertible
Redeemable Preferred Stock and the number of shares which shall constitute
such series shall not be more than 694,445 shares, par value $1.00 per
share, which number may be decreased (but not below the aggregate number
thereof then outstanding and/or which have been reserved for issuance) from
time to time by the Board of Directors and is hereafter in this resolution
called the "Series D Preferred Shares." Each Series D Preferred Share
shall be identical in all respects to each other Series D Preferred Share,
and except as otherwise provided herein, shall be identical in all respects
to each Series D Preferred Share (the Series D Preferred Shares together
with the Excess Series D Preferred Shares being hereinafter referred to as
the "Series D Equity Shares").
Section 2. Definitions. For purposes of the Series D Preferred
Shares, the following terms shall have the meanings indicated:
"Affiliate" of, or Person "Affiliated" with, a specified Person, shall
mean a Person that directly or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control
with the Person specified. For purposes of the Corporation, Affiliate
shall include, without limitation, Westfield Holdings Limited ("WHL"),
Westfield America Trust, Frank Lowy, David Lowy, Peter Lowy and Steven Lowy
(such individuals being the "Lowy Family").
"Base Rate" shall mean an annual dividend per Series D Equity Share
equal to 8.5% of the Liquidation Preference per Series D Equity Share.
"Board of Directors" shall mean the Board of Directors of the
Corporation or any committee authorized by such Board of Directors to
perform any of its responsibilities with respect to the Series D Preferred
Shares.
"Business Day "shall mean any day, other than a Saturday or Sunday,
that is neither a legal holiday nor a day on which banking institutions in
New York City, New York are authorized or required by law, regulation or
executive order to close.
"Call Date" shall mean the date specified in the notice to holders
required under Section 5(d) as the Call Date.
"Code "shall mean the Internal Revenue Code of 1986, as amended.
"Consolidated EBITDA" for any quarter shall mean the consolidated net
income of the Corporation (before extraordinary income or gains and less
equity in income of unconsolidated real estate partnerships), calculated in
a manner consistent with the Corporation's financial statements filed with
the Securities and Exchange Commission, increased by the sum of the
following (without duplication):
a. the Corporation's pro rata share of EBITDA from unconsolidated
real estate partnerships calculated in a manner consistent with
this definition of Consolidated EBITDA,
b. all income taxes paid or accrued according to GAAP for such
quarter (other than income taxes attributable to extraordinary.
unusual or non-recurring gains or losses except to the extent that
such gains were not included in Consolidated EBITDA),
c. all interest expense paid or accrued in accordance with GAAP for
such quarter (including financing fees and amortization of
deferred financing fees or amortization of original issue
discount, but excluding capitalized interest),
d. depreciation and depletion reflected in such net income,
e. amortization reflected in such net income including, without
limitation, amortization of capitalized debt issuance costs (only
to the extent that such amounts have not been previously included
in the amount of Consolidated EBITDA pursuant to clause (c)
above), goodwill, other intangibles and management fees, and
f. any other non-cash charges, to the extent deducted from
consolidated net income (including, but not limited to, income
allocated to minority interests).
"Consolidated Fixed Charges" for any quarter shall mean the sum of:
a. the Corporation's pro rata share of fixed charges from
unconsolidated real estate partnerships calculated in a manner
consistent with this definition of Consolidated Fixed Charges,
b. all interest expense paid or accrued in accordance with GAAP for
such quarter including, without duplication, financing fees and
amortization of deferred financing fees or amortization of
original issue discount),
c. dividend and distribution requirements with respect to preferred
stock (not including any portion of preferred stock dividends the
calculation of which is based on the dividend paid in such quarter
to the holders of common shares) whether or not declared or paid,
d. regularly scheduled amortization of principal of debt during such
quarter (other than any balloon payments at maturity), and
e. all ground rent payments.
"Constituent Person" shall have the meaning set forth in Section 6(e).
"Conversion Date" shall have the meaning set forth in Section 6(a).
"Conversion Price" shall mean the conversion price per Common Equity
Share for which the Series D Equity Share is convertible, as such
Conversion Price may be adjusted pursuant to Section 6. The initial
conversion price shall be $18.00.
"Current Market Price" of publicly traded Common Shares or any other
class of stock or other security of the Corporation or any other issuer for
any day shall mean the last reported sales price, regular way, on such day,
or, if no sale takes place on such day, the average of the reported closing
bid and asked prices on such day, regular way, in either case as reported
on the New York Stock Exchange ("NYSE") or, if such security is not listed
or admitted for trading on the NYSE, on the principal national securities
exchange on which such security is listed or admitted for trading or, if
not listed or admitted for trading on any national securities exchange, on
the Nasdaq National Market ("NASDAQ") or, if such security is not quoted on
NASDAQ, the average of the closing bid and asked prices on such day in the
over-the-counter market as reported by the National Association of
Securities Dealers, Inc. (the "NASD") or, if bid and asked prices for such
security on such day shall not have been reported through the NASD, the
average of the bid and asked prices on such day as furnished by any NYSE
member firm regularly making a market in such security selected for such
purpose by the Board of Directors.
"Dividend Payment Date" shall mean (i) for any Dividend Period with
respect to which the Corporation pays a dividend on the Common Equity
Shares, the date on which such dividend is paid, or (ii) for any Dividend
Period with respect to which the Corporation does not pay a dividend on the
Common Equity Shares, a date to be set by the Board of Directors, which
date shall not be later than the thirtieth calendar day after the end of
the applicable Dividend Period.
"Dividend Period" shall mean quarterly dividend periods commencing on
January 1, April 1, July 1 and October 1 of each year and ending on and
including the day preceding the first day of the next succeeding Dividend
Period with respect to any Series D Equity Shares (other than the initial
Dividend Period, which shall commence on the Issue Date for such Series D
Equity Shares and end on and include the last day of the calendar quarter
immediately following such Issue Date, and other than the Dividend Period
during which any Series D Equity Shares shall be redeemed pursuant to
Section 5 or converted pursuant to Section 6, which shall end on and
include the Call Date or Conversion Date with respect to the Series D
Equity Shares being redeemed or converted, as applicable).
"Expiration Time" shall have the meaning set forth in Section
6(d)(iv).
"Fair Market Value" shall mean the average of the daily Current Market
Prices of a Common Share on the five (5) consecutive Trading Days selected
by the Corporation commencing not more than 20 Trading Days before, and
ending not later than, the earlier of the day in question and the day
before the "ex date" with respect to the issuance or distribution requiring
such computation. The term "ex date," when used with respect to any
issuance or distribution, means the first day on which the Common Shares
trade regular way, without the right to receive such issuance or
distribution on the exchange or in the market, as the case may be, used to
determine that day's Current Market Price.
"Fixed Charge Coverage Violation" shall have the meaning set forth in
Section 3(a).
"Fully Junior Shares" shall mean the Common Shares and any other class
or series of stock of the Corporation now or hereafter issued and
outstanding over which the Series D Preferred Shares preference or priority
in both (i) the payment of dividends and (ii) the distribution of assets on
any liquidation, dissolution or winding up of the Corporation.
"Funds from Operations" shall mean net income (loss) (computed in
accordance with generally accepted accounting principles) excluding gains
(or losses) from debt restructuring, and distributions in excess of
earnings allocated to other operating partnership interests or minority
interests (as reflected in the financial statements of the Corporation)
plus depreciation/amortization of assets unique to the real estate
industry, all computed in a manner consistent with the revised definition
of Funds From Operations adopted by the National Association of Real Estate
Investment Trusts (NAREIT), in its White Paper dated March 1995, as such
definitions may be modified from time to time.
"Investor" shall mean Security Capital Preferred Growth Incorporated
and controlled affiliates thereof.
"Issue Date" shall mean the date on which Series D Preferred Stock is
issued.
"Junior Shares" shall mean the Common Shares and any other class or
series of stock of the Corporation now or hereafter issued and outstanding
over which the Series D Preferred Shares have preference or priority in the
payment of dividends or in the distribution of assets on any liquidation,
dissolution or winding up of the Corporation.
"Non-Electing Share" shall have the meaning set forth in Section 6(e).
"Operating Partnership" shall mean Westfield America Limited
Partnership, a Delaware limited partnership.
"Parity Shares" shall have the meaning set forth in Section 11(b).
"Person" shall mean any individual, firm, partnership, corporation,
limited liability company, trust or other entity, and shall include any
successor (by merger or otherwise) of such entity.
"Purchased Shares" shall have the meaning set forth in Section
6(d)(iv).
"REIT Termination Event" shall mean the earliest to occur of:
(i) the filing of a federal income tax return by the Corporation
for any taxable year on which the Corporation does not compute
its income as a real estate investment trust,
(ii) the approval by the shareholders of the Corporation of a
proposal for the Corporation to cease to qualify as a real
estate investment trust,
(iii) a determination by the Board of Directors of the Corporation,
based on the advice of counsel, that the Corporation has
ceased to qualify as a real estate investment trust, or
(iv) a "determination" within the meaning of Section 1313(a) of the
Code that the Corporation has ceased to qualify as a real
estate investment trust.
"Securities" and "Security" shall have the meanings set forth in
Section 6(d)(iii).
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Series D Preferred Shares" shall have the meaning given such term in
the preamble to the Certificate of Designation.
"set apart for payment" shall be deemed to include, without any action
other than the following, the recording by the Corporation in its
accounting ledgers of any accounting or bookkeeping entry which indicates,
pursuant to a declaration of dividends or other distribution by the Board
of Directors, the allocation of funds to be so paid on any series or class
of stock of the Corporation; provided, however, that if any funds for any
class or series of Junior Shares or any class or series of stock ranking on
a parity with the Series D Preferred Shares as to the payment of dividends
are placed in a separate account of the Corporation or delivered to a
disbursing, paying or other similar agent, then "set apart for payment"
with respect to the Series D Preferred Shares shall mean placing such funds
in a separate account or delivering such funds to a disbursing, paying or
other similar agent.
"Trading Day" shall mean any day on which the securities in question
are traded on the NYSE, or if such securities are not listed or admitted
for trading on the NYSE, on the principal national securities exchange on
which such securities are listed or admitted, or if not listed or admitted
for trading on any national securities exchange, on NASDAQ, or if such
securities are not quoted on NASDAQ, in the securities market in which the
securities are traded.
"Transaction" shall have the meaning set forth in Section 6(e).
"Transfer Agent" shall mean the Corporation, or such other agent or
agents of the Corporation as may be designated by the Board of Directors or
their designee as the transfer agent, registrar and dividend disbursing
agent for Series D Preferred Shares and notified to the holders of the
Series D Preferred Stock.
Capitalized terms not otherwise defined herein have the meanings ascribed
to them in the Articles.
Section 3. Dividends. (a) Subject to the preferential rights of the
holders of any Preferred Stock that ranks senior in the payment of
dividends to the Series D Equity Shares and subject to paragraph (b) of
this Section 3, the holders of Series D Equity Shares shall be entitled to
receive, when, as and if declared by the Board of Directors, but only out
of funds legally available for the payment of dividends, cumulative
preferential dividends payable in cash to shareholders of record on the
respective date, not exceeding 50 days preceding such dividend payment
date, fixed for the purpose by the Board of Directors in advance of payment
of each particular dividend in an amount equal to the greater of (A) the
Base Rate per share per annum and (B) an amount per share equal to the
Liquidation Preference of a Series D Equity Share (exclusive of accrued but
unpaid dividends) divided by the Conversion Price (the "Series D Common
Equivalent Factor") times the dollar amount of cash dividends declared with
respect to each Common Equity Share that does not result in an adjustment
to the Conversion Price pursuant to subparagraph (d)(iii) of Section 6
(such product, the "Series D Common Equivalent Amount") for the same annual
period; provided, however, that if as a result of the quarterly dividends
paid in accordance with the following sentence, the holders of Series D
Equity Shares shall have received for any calendar year more dividends than
such Shares shall be entitled under clauses (A) and (B) above (as adjusted
pursuant to the third and eighth sentences of this Section 3), the
dividends payable in respect of Series D Equity Shares in subsequent
calendar years shall be reduced to the extent of such overpayment. Subject
to the proviso of the preceding sentence of this Section 3(a), the dividend
paid in respect of each quarterly period in each calendar year shall be
determined as follows (in each case, excluding any additional payment made
pursuant to the following sentence): (1) for the first quarter, the
greater of 25% of the Base Rate per share and the Series D Common
Equivalent Amount for the same quarter; (2) for the second quarter, an
amount such that the aggregate amount to be received per Series D Equity
Share in respect of the first two quarters of such calendar year shall be
the greater of 50% of the Base Rate per share and the Series D Common
Equivalent Amount for the same two quarters; (3) for the third quarter, an
amount such that the aggregate amount to be received per Series D Equity
Share in respect of the first three quarters of such calendar year shall be
the greater of 75% of the Base Rate per share and the Series D Common
Equivalent Amount for the same three quarters; and (4) for the fourth
quarter, an amount such that the aggregate amount to be received per Series
D Equity Share in respect of such calendar year shall be the amount
provided in the preceding sentence of this Section 3(a). Notwithstanding
the foregoing, for any quarter in which a Fixed Charge Coverage Violation
(as defined below) has occurred, the dividend payable per Series D Equity
Share shall be 1.20 times the amount provided in the preceding sentence. A
"Fixed Charge Coverage Violation" shall occur for any quarter that the
ratio of the Corporation's Consolidated EBITDA to its Consolidated Fixed
Charges is below 1.40 to 1. The dividends shall begin to accrue as set
forth above and shall be fully cumulative from the first day of the
applicable Dividend Period, whether or not in any Dividend Period or
Periods there shall be funds of the Corporation legally available for the
payment of such dividends, and shall be payable quarterly, when, as and if
declared by the Board of Directors, in arrears on Dividend Payment Dates.
Accumulated but unpaid dividends for any past quarterly dividend periods
may be declared and paid at any time, without reference to any regularly
scheduled quarterly dividend payment date, to holders of record on such
date, not exceeding 50 days preceding such payment date, fixed for the
purpose by the Board of Directors in advance of payment of each particular
dividend. Any dividend payment made on Series D Equity Shares shall first
be credited against the earliest accrued but unpaid dividend due with
respect to Series D Equity Shares which remains payable. Beginning with
the quarter in which a REIT Termination Event occurs, all dividends payable
per Series D Equity Share pursuant to this Section shall be multiplied by
2.5.
(b) The initial Dividend Period for the Series D Equity Shares will
include a partial dividend for the period from the Issue Date until the
last day of the calendar quarter immediately following such Issue Date.
The amount of dividends payable for such initial period, or any other
period shorter than a full quarterly Dividend Period, on the Series D
Equity Shares shall be computed by dividing the number of days in such
period by 90 and multiplying the result by the Series D Equity dividend
determined in accordance with Section 3(a). Holders of Series D Equity
Shares shall not be entitled to any dividends, whether payable in cash,
property or shares, in excess of cumulative dividends, as herein provided,
on the Series D Equity Shares. No interest, or sum of money in lieu of
interest, shall be payable in respect of any dividend payment or payments
on the Series D Equity Shares which may be in arrears.
(c) So long as any Series D Equity Shares remain outstanding, no
dividends, except as described in the immediately following sentence, shall
be declared or paid or set apart for payment on any class or series of
Parity Shares for any period unless full cumulative dividends have been or
contemporaneously are declared and paid or declared and a sum sufficient
for the payment thereof set apart for such payment on the Series D Equity
Shares for all Dividend Periods terminating on or prior to the dividend
payment date on such class or series of Parity Shares. When dividends are
not paid in full or a sum sufficient for such payment is not set apart, as
aforesaid, all dividends declared upon Series D Equity Shares and all
dividends declared upon any other class or series of Parity Shares shall be
declared ratably in proportion to the respective amounts of dividends
accumulated and unpaid on the Series D Equity Shares and accumulated and
unpaid on such Parity Shares.
(d) So long as any Series D Equity Shares remain outstanding, no
dividends (other than dividends or distributions paid solely in Fully
Junior Shares, or options, warrants or rights to subscribe for or purchase,
Fully Junior Shares) shall be declared or paid or set apart for payment or
other distribution shall be declared or made or set apart for payment upon
Junior Shares, nor shall any Junior Shares be redeemed, purchased or
otherwise acquired (other than a redemption, purchase or other acquisition
of Common Shares made for purposes of an employee incentive or benefit plan
of the Corporation or any subsidiary) for any consideration (or any moneys
be paid to or made available for a sinking fund for the redemption of any
Junior Shares) by the Corporation, directly or indirectly (except by
conversion into or exchange for Fully Junior Shares), unless in each case
the full cumulative dividends on all outstanding Series D Equity Shares and
any other Parity Shares of the Corporation shall have been or
contemporaneously are declared and paid or declared and set apart for
payment for all Dividend Periods terminating on or prior to the date of
declaration or payment with respect to the Series D Equity Shares and all
dividend periods terminating on or prior to the date of declaration or
payment with respect to such Parity Shares. Subject to the foregoing, and
not otherwise, such dividends and distributions may be declared by the
Board of Directors and paid on any Common Equity Shares from time to time
out of any funds legally available therefor, and the Series D Equity Shares
shall not be entitled to participate in any such dividends, whether payable
in cash, stock or otherwise.
(e) No distributions on Series D Equity Shares shall be declared by
the Board of Directors or paid or set apart for payment by the Corporation
at such time as the terms and provisions of any agreement of the
Corporation, including any agreement relating to its indebtedness,
prohibits such declaration, payment or setting apart for payment or
provides that such declaration, payment or setting apart for payment would
constitute a breach thereof or a default thereunder, or if such declaration
or payment shall be restricted or prohibited by law.
(f) In determining whether a distribution by dividend, redemption or
other acquisition of Shares or otherwise is permitted under Missouri law,
no effect shall be given to 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 shareholders whose
preferential rights on dissolution are superior to those receiving the
distribution.
Section 4. Liquidation Preference. (a) In the event of any
liquidation, dissolution or winding up of the Corporation, whether
voluntary or involuntary, subject to the prior preferences and other rights
of any series of stock ranking senior to the Series D Preferred Shares upon
liquidation, distribution or winding up of the Corporation, before any
payment or distribution of the assets of the Corporation (whether capital
or surplus) shall be made to or set apart for the holders of Junior Shares,
the holders of the Series D Equity Shares shall be entitled to receive One
Hundred Eighty Dollars ($180.00) (the "Liquidation Preference") per Series
D Equity Share plus an amount equal to all dividends (whether or not earned
or declared) accrued and unpaid thereon to the date of liquidation,
dissolution or winding up of the affairs of the Corporation (any such date,
a "Series D Liquidation Date") but such holders shall not be entitled to
any further payment; provided, that the dividend payable with respect to
the Dividend Period containing the Series D Liquidation Date shall be equal
to the dividend determined pursuant to Section 3 above for the preceding
Dividend Period times a fraction equal to the actual number of days elapsed
from the end date of the calendar quarter most recently completed to the
relevant Series D Liquidation Date over ninety days. If, upon any
liquidation, dissolution or winding up of the Corporation, the assets of
the Corporation, or proceeds thereof, distributable among the holders of
the Series D Equity Shares shall be insufficient to pay in full the
preferential amount aforesaid and liquidating payments on any other shares
of any class or series of Parity Shares, then such assets, or the proceeds
thereof, shall be distributed among the holders of Series D Equity Shares
and any such other Parity Shares ratably in accordance with the respective
amounts that would be payable on such Series D Equity Shares and any such
other Parity Shares if all amounts payable thereon were paid in full. For
the purposes of this Section 4, (i) a consolidation or merger of the
Corporation with one or more corporations, real estate investment trusts or
other entities, (ii) a sale, lease or conveyance of all or substantially
all of the Corporation's property or business or (iii) a statutory share
exchange shall not be deemed to be a liquidation, dissolution or winding
up, voluntary or involuntary, of the Corporation.
(b) Subject to the rights of the holders of shares of any series or
class or classes of stock ranking on a parity with or prior to the Series D
Equity Shares upon liquidation, dissolution or winding up, upon any
liquidation, dissolution or winding up of the Corporation, after payment
shall have been made in full to the holders of the Series D Equity Shares,
as provided in this Section 4, the holders of Series D Equity Shares shall
have no other claim to the remaining assets of the Corporation and any
other series or class or classes of Junior Shares shall, subject to the
respective terms and provisions (if any) applying thereto, be entitled to
receive any and all assets remaining to be paid or distributed, and the
holders of the Series D Equity Shares shall not be entitled to share
therein.
Section 5. Redemption at the Option of the Corporation. (a) The
Series D Equity Shares shall not be redeemable by the Corporation prior to
August 12, 2008.(1) On and after August 12, 2008, the Corporation, at its
option, may redeem the Series D Equity Shares, in whole at any time or from
time to time in part, in minimum increments of $10.0 million of aggregate
Liquidation Preference of such shares, out of funds legally available
therefor at a redemption price payable in cash equal to 100% of the
Liquidation Preference per Series D Equity Share (plus all accumulated,
accrued and unpaid dividends as provided in paragraph (d) below).
-----------------
1. This date is the tenth anniversary of the Closing.
(b) In the event that WHL and its subsidiaries and the trustee of
Westfield America Trust on behalf of Westfield America Trust do not vote to
approve the conversion of the Series D Equity Shares into Common Equity
Shares at the Corporation's 1999 Annual Shareholder Meeting or at any other
meeting of the Corporation's shareholders at which such proposal is raised,
the Corporation shall have the right to redeem the Series D Equity Shares,
in whole or in part, out of funds legally available therefor at a
redemption price payable in cash equal to 100% of the Liquidation
Preference per Series D Equity Share (plus all accumulated, accrued and
unpaid dividends as provided in paragraph (c) below).
(c) Upon any redemption of Series D Equity Shares pursuant to this
Section 5, the Corporation shall pay all accrued and unpaid dividends, if
any, thereon to the Call Date, without interest. If the Call Date falls
after a dividend payment record date and prior to the corresponding
Dividend Payment Date, then each holder of Series D Equity Shares at the
close of business on such dividend payment record date shall be entitled to
the dividend payable on such shares on the corresponding Dividend Payment
Date notwithstanding any redemption of such shares before such Dividend
Payment Date. Except as provided above, the Corporation shall make no
payment or allowance for unpaid dividends, whether or not in arrears, on
Series D Equity Shares called for redemption.
(d) If full cumulative dividends on the Series D Equity Shares and
any other class or series of Parity Shares of the Corporation have not been
declared and paid or declared and set apart for payment, the Series D
Equity Shares may not be redeemed under this Section 5 in part and the
Corporation may not purchase or acquire Series D Equity Shares, otherwise
than pursuant to a purchase or exchange offer made on the same terms to all
holders of Series D Equity Shares.
(e) Notice of the redemption of any Series D Equity Shares under this
Section 5 shall be mailed by first-class mail or recognized overnight
courier to each holder of record of Series D Equity Shares to be redeemed
at the address of each such holder as shown on the Corporation's records,
not less than 30 nor more than 90 days prior to the Call Date. Neither the
failure to mail any notice required by this paragraph (e), nor any defect
therein or in the mailing thereof, to any particular holder, shall affect
the sufficiency of the notice or the validity of the proceedings for
redemption with respect to the other holders. Each such mailed notice
shall state, as appropriate: (1) the Call Date; (2) the number of Series D
Equity Shares to be redeemed and, if fewer than all the shares held by such
holder are to be redeemed, the number of such shares to be redeemed from
such holder; (3) the redemption price; (4) the place or places at which
certificates for such shares are to be surrendered; (5) the then-current
Conversion Price; and (6) that dividends on the shares to be redeemed shall
cease to accrue on such Call Date except as otherwise provided herein.
Notice having been mailed as aforesaid, from and after the Call Date
(unless the Corporation shall fail to make available an amount of cash
necessary to effect such redemption), (i) except as otherwise provided
herein, dividends on the Series D Equity Shares so called for redemption
shall cease to accrue, (ii) such shares shall no longer be deemed to be
outstanding, and (iii) all rights of the holders thereof as holders of
Series D Equity Shares shall cease (except the rights to receive the cash
payable upon such redemption, without interest thereon, upon surrender and
endorsement of their certificates if so required and to receive any
dividends payable thereon). The Corporation's obligation to provide cash
in accordance with the preceding sentence shall be deemed fulfilled if, on
or before the Call Date, the Corporation shall deposit with a bank or trust
company that has an office in the Borough of Manhattan, City of New York,
and that has capital and surplus of at least $150,000,000, necessary for
such redemption, in trust, with irrevocable instructions that such cash be
applied to the redemption of the Series D Equity Shares so called for
redemption. Notwithstanding the foregoing the Corporation shall, in the
first instance, send the money to any holder of Series D Equity Shares that
has notified the Corporation in writing of the location of delivery of
funds. No interest shall accrue for the benefit of the holders of Series D
Equity Shares to be redeemed on any cash so set aside by the Corporation.
Subject to applicable escheat laws, any such cash unclaimed at the end of
two years from the Call Date shall revert to the general funds of the
Corporation, after which reversion the holders of such shares so called for
redemption shall look only to the general funds of the Corporation for the
payment of such cash.
As promptly as practicable after the surrender in accordance with such
notice of the certificates for any such shares so redeemed (properly
endorsed or assigned for transfer, if the Corporation shall so require and
if the notice shall so state), such shares shall be exchanged for any cash
(without interest thereon) for which such shares have been redeemed. If
fewer than all the outstanding Series D Equity Shares are to be redeemed,
shares to be redeemed shall be selected by the Corporation from outstanding
Series D Equity Shares not previously called for redemption pro rata (as
nearly as may be), by lot or by any other method determined by the
Corporation in its sole discretion to be equitable. If fewer than all the
Series D Equity Shares evidenced by any certificate are redeemed, then new
certificates evidencing the unredeemed shares shall be issued without cost
to the holder thereof.
Section 6. Conversion. The Series D Equity Shares shall not be
convertible into Common Equity Shares prior to (i) a vote of the
shareholders of the Corporation approving the conversion of Series D Equity
Shares into Common Equity Shares or (ii) the transfer of the Series D
Equity Shares to an individual to whom the Corporation is permitted to
issue Common Equity Shares without shareholder approval, in accordance with
the rules of the NYSE. Subject to the foregoing, holders of Series D
Equity Shares shall have the right to convert all or a portion of such
shares into Common Equity Shares, as follows:
(a) Subject to and upon compliance with the provisions of this
Section 6, a holder of Series D Preferred Shares or Excess Series D
Preferred Shares shall have the right, at his or her option, at any time
(such time being, the "Conversion Date"), to convert all or any portion of
such shares into the number of fully paid and non-assessable Common Shares
or Excess Common Shares, respectively, obtained by dividing the aggregate
Liquidation Preference of such shares (inclusive of accrued but unpaid
dividends) by the Conversion Price (as in effect at the time and on the
date provided for in the last paragraph of paragraph (b) of this Section 6)
by surrendering such shares to be converted, such surrender to be made in
the manner provided in paragraph (b) of this Section 6; provided, however,
that the right to convert shares called for redemption pursuant to Section
5 shall terminate at the close of business on the fifth Business Day prior
to the Call Date fixed for such redemption, unless the Corporation shall
default in making payment of the cash payable upon such redemption under
Section 5.
(b) In order to exercise the conversion right, the holder of each
share of Series D Equity Shares to be converted shall surrender the
certificate representing such share, duly endorsed or assigned to the
Corporation or in blank, at the office of the Transfer Agent, accompanied
by written notice to the Corporation that the holder thereof irrevocably
elects to convert such Series D Equity Shares. Unless the shares issuable
on conversion are to be issued in the same name as the name in which such
Series D Equity Shares are registered, each share surrendered for
conversion shall be accompanied by instruments of transfer, in form
satisfactory to the Corporation, duly executed by the holder or such
holder's duly authorized attorney and an amount sufficient to pay any
transfer or similar tax (or evidence reasonably satisfactory to the
Corporation demonstrating that such taxes have been paid).
Holders of Series D Equity Shares at the close of business on a
dividend payment record date shall be entitled to receive the dividend
payable on such shares on the corresponding Dividend Payment Date
notwithstanding the conversion thereof following such dividend payment
record date and prior to such Dividend Payment Date. However, Series D
Equity Shares surrendered for conversion during the period between the
close of business on any dividend payment record date and the opening of
business on the corresponding Dividend Payment Date (except shares
converted after the issuance of notice of redemption with respect to a Call
Date during such period, such Series D Equity Shares being entitled to such
dividend on the Dividend Payment Date) must be accompanied by payment of an
amount equal to the dividend payable on such shares on such Dividend
Payment Date. A holder of Series D Equity Shares on a dividend payment
record date who (or whose transferee) tenders any such shares for
conversion into Common Equity Shares on the corresponding Dividend Payment
Date will receive the dividend payable by the Corporation on such Series D
Equity Shares on such date, and the converting holder need not include
payment of the amount of such dividend upon surrender of Series D Equity
Shares for conversion. Except as provided above, the Corporation shall
make no payment or allowance for unpaid dividends, whether or not in
arrears, on converted shares or for dividends on the Common Equity Shares
issued upon such conversion.
As promptly as practicable after the surrender of certificates for
Series D Equity Shares as aforesaid, the Corporation shall issue and shall
deliver at such office to such holder, or on his or her written order, a
certificate or certificates for the number of full Common Equity Shares
issuable upon the conversion of such shares in accordance with provisions
of this Section 6, and any fractional interest in respect of a Common
Equity Share arising upon such conversion shall be settled as provided in
paragraph (c) of this Section 6.
Each conversion shall be deemed to have been effected immediately
prior to the close of business on the date on which the certificates for
Series D Equity Shares shall have been surrendered and such notice shall
have been received by the Corporation as aforesaid (and if applicable,
payment of an amount equal to the dividend payable on such shares shall
have been received by the Corporation as described above), and the Person
or Persons in whose name or names any certificate or certificates for
Common Equity Shares shall be issuable upon such conversion shall be deemed
to have become the holder or holders of record of the shares represented
thereby at such time on such date and such conversion shall be at the
Conversion Price in effect at such time on such date unless the share
transfer books of the Corporation shall be closed on that date, in which
event such Person or Persons shall be deemed to have become such holder or
holders of record at the close of business on the next succeeding day on
which such share transfer books are open, but such conversion shall be at
the Conversion Price in effect on the date on which such shares shall have
been surrendered and such notice received by the Corporation.
(c) No fractional shares or scrip representing fractions of Common
Equity Shares shall be issued upon conversion of the Series D Equity
Shares. Instead of any fractional interest in a Common Equity Share that
would otherwise be deliverable upon the conversion of a Series D Equity
Share, the Corporation shall pay to the holder of such share an amount in
cash based upon the Current Market Price of the Common Shares on the
Trading Day immediately preceding the date of conversion. If more than one
share shall be surrendered for conversion at one time by the same holder,
the number of full Common Equity Shares issuable upon conversion thereof
shall be computed on the basis of the aggregate number of Series D Equity
Shares so surrendered.
(d) The Conversion Price shall be adjusted from time to time as
follows:
(i) If the Corporation shall after the Issue Date (A) pay a
dividend or make a distribution on its Common Equity Shares in Common
Equity Shares, (B) subdivide its outstanding Common Equity Shares into
a greater number of shares, (C) combine its outstanding Common Equity
Shares into a smaller number of shares or (D) issue any shares of
stock by reclassification of its Common Equity Shares, the Conversion
Price in effect at the opening of business on the day following the
date fixed for the determination of shareholders entitled to receive
such dividend or distribution or at the opening of business on the
Business Day next following the day on which such subdivision,
combination or reclassification becomes effective, as the case may be,
shall be adjusted so that the holder of any Series D Equity Shares
thereafter surrendered for conversion shall be entitled to receive the
number of Common Equity Shares that such holder would have owned or
have been entitled to receive after the happening of any of the events
described above as if such Series D Equity Shares had been converted
immediately prior to the record date in the case of a dividend or
distribution or the effective date in the case of a subdivision,
combination or reclassification. An adjustment made pursuant to this
subparagraph (i) shall become effective immediately after the opening
of business on the Business Day next following the record date (except
as provided in paragraph (h) below) in the case of a dividend or
distribution and shall become effective immediately after the opening
of business on the Business Day next following the effective date in
the case of a subdivision, combination or reclassification.
(ii) If the Corporation shall issue after the Issue Date rights,
options or warrants to all holders of Common Equity Shares entitling
them (for a period expiring within 45 days after the record date
mentioned below) to subscribe for or purchase Common Equity Shares at
a price per share less than 95% (100% if a stand-by underwriter is
used and charges the Corporation a commission) of the Fair Market
Value per Common Share on the record date for the determination of
shareholders entitled to receive such rights, options or warrants,
then the Conversion Price in effect at the opening of business on the
Business Day next following such record date shall be adjusted to
equal the price determined by multiplying (A) the Conversion Price in
effect immediately prior to the opening of business on the Business
Day next following the date fixed for such determination by (B) a
fraction, the numerator of which shall be the sum of (x) the number of
Common Equity Shares outstanding on the close of business on the date
fixed for such determination and (y) the number of shares that the
aggregate proceeds to the Corporation from the exercise of such
rights, options or warrants for Common Equity Shares would purchase at
95% of such Fair Market Value (or 100% in the case of a stand-by
underwriting), and the denominator of which shall be the sum of (x)
the number of Common Equity Shares outstanding on the close of
business on the date fixed for such determination and (y) the number
of additional Common Equity Shares offered for subscription or
purchase pursuant to such rights, options or warrants. Such
adjustment shall become effective immediately after the opening of
business on the day next following such record date (except as
provided in paragraph (h) below). In determining whether any rights,
options or warrants entitle the holders of Common Equity Shares to
subscribe for or purchase Common Equity Shares at less than 95% of
such Fair Market Value (or 100% in the case of a stand-by
underwriting), there shall be taken into account any consideration
received by the Corporation upon issuance and upon exercise of such
rights, options or warrants, the value of such consideration, if other
than cash, to be determined by the Board of Directors whose
determination shall be conclusive. To the extent that Common Equity
Shares are not delivered pursuant to such rights, options or warrants,
upon the expiration or termination of such rights, options or
warrants, the Conversion Price shall be readjusted to the Conversion
Price which would then be in effect had the adjustments made upon the
issuance of such rights, options or warrants be made on the basis of
delivery of only the number of Common Equity Shares actually
delivered. In the event that such rights, options or warrants are not
so issued, the Conversion Price shall again be adjusted to be the
Conversion Price which would then be in effect if such date fixed for
the determination of stockholders entitled to receive such rights,
options or warrants had not been fixed.
(iii) If the Corporation shall distribute to all holders of its
Common Equity Shares any securities of the Corporation (other than
Common Equity Shares) or evidence of its indebtedness or assets
(excluding cumulative cash dividends or distributions paid with
respect to the Common Equity Shares after December 31, 1997) which are
not in excess of the following: the sum of (A) the Corporation's
cumulative undistributed Funds from Operations at December 31, 1997,
plus (B) the cumulative amount of Funds from Operations, as determined
by the Board of Directors, after December 31, 1997, minus (C) the
cumulative amount of dividends accrued or paid in respect of the
Series D Equity Shares or any other class or series of preferred stock
of the Corporation after the Issue Date) or rights, options or
warrants to subscribe for or purchase any of its securities (excluding
those rights, options and warrants issued to all holders of Common
Equity Shares entitling them for a period expiring within 45 days
after the record date referred to in subparagraph (ii) above to
subscribe for or purchase Common Equity Shares, which rights and
warrants are referred to in and treated under subparagraph (ii) above)
(any of the foregoing being hereinafter in this subparagraph (iii)
collectively called the "Securities" and individually a "Security"),
then in each such case the Conversion Price shall be adjusted so that
it shall equal the price determined by multiplying (x) the Conversion
Price in effect immediately prior to the close of business on the date
fixed for the determination of shareholders entitled to receive such
distribution by (y) a fraction, the numerator of which shall be the
Fair Market Value per Common Share on the record date mentioned below
less the then fair market value (as determined by the Board of
Directors, whose determination shall be conclusive) of the portion of
the Securities or assets or evidences of indebtedness so distributed
or of such rights, options or warrants applicable to one Common Equity
Share, and the denominator of which shall be the Fair Market Value per
Common Share on the record date mentioned below. Such adjustment
shall become effective on the date of distribution retroactive to the
opening of business on the Business Day next following (except as
provided in paragraph (h) below) the record date for the determination
of shareholders entitled to receive such distribution. For the
purposes of this subparagraph (iii), the distribution of a Security,
which is distributed not only to the holders of the Common Equity
Shares on the date fixed for the determination of shareholders
entitled to such distribution of such Security, but also is
distributed with each Common Equity Share delivered to a Person
converting a share of Series D Equity Shares after such determination
date, shall not require an adjustment of the Conversion Price pursuant
to this subparagraph (iii); provided that on the date, if any, on
which a Person converting a Series D Equity Share would no longer be
entitled to receive such Security with a Common Equity Share (other
than as a result of the termination of all such Securities), a
distribution of such Securities shall be deemed to have occurred and
the Conversion Price shall be adjusted as provided in this
subparagraph (iii) (and such day shall be deemed to be "the date fixed
for the determination of the shareholders entitled to receive such
distribution" and "the record date" within the meaning of the two
preceding sentences). If any dividend or distribution of the type
described in this paragraph (iii) is declared but not so paid or made,
the Conversion Price shall again be adjusted to the Conversion Price
which would then be in effect if such dividend or distribution had not
been declared.
Rights or warrants distributed by the Corporation to all holders
of Common Equity Shares entitling the holders thereof to subscribe for
or purchase shares of the Corporation's capital stock (either
initially or under certain circumstances), which rights or warrants,
until the occurrence of a specified event or events ("Trigger Event"):
(i) are deemed to be transferred with such shares of Common Equity
Shares; (ii) are not exercisable; and (iii) are also issued in respect
of future issuances of Common Equity Shares, shall be deemed not to
have been distributed for purposes of this subparagraph (iii) (and no
adjustment to the Conversion Price under this subparagraph (iii) will
be required) until the occurrence of the earliest Trigger Event. If
such right or warrant is subject to subsequent events, upon the
occurrence of which such right or warrant shall become exercisable to
purchase different securities, evidences of indebtedness or other
assets or entitle the holder to purchase a different number or amount
of the foregoing or to purchase any of the foregoing at a different
purchase price, then the occurrence of each such event shall be deemed
to be the date of issuance and record date with respect to a new right
or warrant (and a termination or expiration of the existing right or
warrant without exercise by the holder thereof to the extent not
exercised). In addition, in the event of any distribution (or deemed
distribution) of rights or warrants, or any Trigger Event or other
event (of the type described in the preceding sentence) with respect
thereto, that resulted in an adjustment to the Conversion Price under
this subparagraph (iii), (1) in the case of any such rights or
warrants which shall all have been redeemed or repurchased without
exercise by any holders thereof, the Conversion Price shall be
readjusted upon such final redemption or repurchase to give effect to
such distribution or Trigger Event, as the case may be, as though it
were a cash distribution (but not a distribution paid exclusively in
cash), equal to the per share redemption or repurchase price received
by a holder of Common Equity Shares with respect to such rights or
warrants (assuming such holder had retained such rights or warrants),
made to all holders of Common Equity Shares as of the date of such
redemption or repurchase, and (2) in the case of such rights or
warrants all of which shall have expired or been terminated without
exercise, the Conversion Price shall be readjusted as if such rights
and warrants had never been issued.
(iv) In case a tender or exchange offer (which term shall not
include open market repurchases by the Corporation) made by the
Corporation or any subsidiary or controlled Affiliate of the
Corporation for all or any portion of the Common Equity Shares shall
expire and such tender or exchange offer shall require the payment by
the Corporation or such subsidiary or controlled Affiliate of
consideration per Common Equity Share having a fair market value (as
determined in good faith by the Board of Directors, whose
determination shall be conclusive and described in a resolution of the
Board of Directors), at the last time (the "Expiration Time") tenders
or exchanges may be made pursuant to such tender or exchange offer,
that exceeds the Current Market Price per Common Share on the Trading
Day next succeeding the Expiration Time, the Conversion Price shall be
reduced so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the
effectiveness of the Conversion Price reduction contemplated by this
subparagraph, by a fraction of which the numerator shall be the number
of Common Equity Shares outstanding (including any tendered or
exchanged shares) at the Expiration Time, multiplied by the Current
Market Price per Common Share on the Trading Day next succeeding the
Expiration Time, and the denominator shall be the sum of (A) the fair
market value (determined as aforesaid) of the aggregate consideration
payable to shareholders based upon the acceptance (up to any maximum
specified in the terms of the tender or exchange offer) of all shares
validly tendered or exchanged and not withdrawn as of the Expiration
Time (the shares deemed so accepted, up to any maximum, being referred
to as the "Purchased Shares") and (B) the product of the number of
Common Equity Shares outstanding (less any Purchased Shares) at the
Expiration Time and the Current Market Price per Common Share on the
Trading Day next succeeding the Expiration Time, such reduction to
become effective immediately prior to the opening of business on the
day following the Expiration Time. In the event the Corporation or
any subsidiary or controlled Affiliate is obligated to purchase shares
pursuant to any such tender offer, but the Corporation or such
subsidiary or controlled Affiliate is permanently prevented by
applicable law from effecting any such purchases, or all such
purchases are rescinded, the Conversion Price shall again be adjusted
to be the Conversion Price which would then be in effect if such
tender offer had not been made.
(v) No adjustment in the Conversion Price shall be required
unless such adjustment would require a cumulative increase or decrease
of at least 1% in such price; provided, however, that any adjustments
that by reason of this subparagraph (v) are not required to be made
shall be carried forward and taken into account in any subsequent
adjustment until made; and provided, further, that any adjustment
shall be required and made in accordance with the provisions of this
Section 6 (other than this subparagraph (v)) not later than such time
as may be required in order to preserve the tax-free nature of a
distribution to the holders of Common Shares. Notwithstanding any
other provisions of this Section 6, the Corporation shall not be
required to make any adjustment of the Conversion Price for the
issuance of any Common Equity Shares pursuant to any plan providing
for the reinvestment of dividends or interest payable on securities of
the Corporation and the investment of additional optional amounts in
Common Equity Shares under such plan. All calculations under this
Section 6 shall be made to the nearest cent (with $.005 being rounded
upward) or to the nearest one-hundredth of a share (with .005 of a
share being rounded upward), as the case may be. Anything in this
paragraph (d) to the contrary notwithstanding, the Corporation shall
be entitled, to the extent permitted by law, to make such reductions
in the Conversion Price, in addition to those required by this
paragraph (d), as it in its discretion shall determine to be advisable
in order that any share dividends, subdivision of shares,
reclassification or combination of shares, distribution of rights or
warrants to purchase shares or securities, or distribution of other
assets (other than cash dividends) hereafter made by the Corporation
to its shareholders shall not be taxable. To the extent permitted by
applicable law, the Corporation from time to time may reduce the
Conversion Price by any amount for any period of time if the period is
at least 20 days, the reduction is irrevocable during the period and
the Board of Directors shall have made a determination that such
reduction would be in the best interests of the Corporation, which
determination shall be conclusive. Whenever the Conversion Price is
reduced pursuant to the preceding sentence, the Corporation shall mail
to the holder of each Series D Equity Share at his or her last address
appearing on the share register a notice of reduction prior to the
date the reduced Conversion Price takes effect and such notice shall
state the reduced Conversion Price and the period during which it will
be in effect.
(e) If the Corporation shall be a party to any transaction (including
without limitation a merger, consolidation, statutory share exchange, self
tender offer for 40% or more of its Common Equity Shares, sale of all or
substantially all of the Corporation's assets or recapitalization of the
Common Equity Shares and excluding any transaction as to which subparagraph
(d)(i) of this Section 6 applies) (each of the foregoing being referred to
herein as a "Transaction"), in each case as a result of which all or
substantially all of the Common Equity Shares are converted into the right
to receive different securities or other property (including cash or any
combination thereof), each Series D Equity Share which is not redeemed or
converted into the right to receive different securities or other property
prior to such Transaction shall thereafter be convertible, in lieu of
Common Equity Shares into the kind and amount of different securities and
other property (including cash or any combination thereof) receivable upon
the consummation of such Transaction by a holder of that number of Common
Equity Shares into which one Series D Equity Share was convertible
immediately prior to such Transaction, assuming such holder of Common
Equity Shares (i) is not a Person with which the Corporation consolidated
or into which the Corporation merged or which merged into the Corporation
or to which such sale or transfer was made, as the case may be
("Constituent Person"), or an Affiliate of a Constituent Person and (ii)
failed to exercise his rights of election, if any, as to the kind or amount
of shares, securities and other property (including cash) receivable upon
such Transaction (provided that if the kind or amount of shares, securities
and other property (including cash) receivable upon such Transaction is not
the same for each Common Share held immediately prior to such Transaction
by other than a Constituent Person or an Affiliate thereof and in respect
of which such rights of election shall not have been exercised ("Non-
Electing Share"), then for the purpose of this paragraph (e) the kind and
amount of shares, securities and other property (including cash) receivable
upon such Transaction by each Non-Electing Share shall be deemed to be the
kind and amount so receivable per share by holders of a plurality of the
Non-Electing Shares). The Corporation shall not be a party to any
Transaction unless the terms of such Transaction are consistent with the
provisions of this paragraph (e), and it shall not consent or agree to the
occurrence of any Transaction until the Corporation has entered into an
agreement with the successor or purchasing entity, as the case may be, for
the benefit of the holders of the Series D Equity Shares that will contain
provisions enabling the holders of the Series D Equity Shares that remain
outstanding after such Transaction to convert into the consideration
received by holders of Common Equity Shares at the Conversion Price in
effect immediately prior to such Transaction. The provisions of this
paragraph (e) shall similarly apply to successive Transactions.
(f) If:
(i) the Corporation shall declare a dividend (or any other
distribution) on its Common Equity Shares (other than cash dividends
or distributions paid with respect to the Common Equity Shares after
December 31, 1997 not in excess of the sum of the Corporation's
cumulative undistributed Funds from Operations at December 31, 1997,
plus the cumulative amount of Funds from Operations, as determined by
the Board of Directors, after December 31, 1997, minus the cumulative
amount of dividends accrued or paid in respect of the Series D Equity
Shares or any other class or series of preferred stock of the
Corporation after the Issue Date); or
(ii) the Corporation shall authorize the granting to all holders
of Common Equity Shares of rights, options or warrants to subscribe
for or purchase any shares of any class or any other rights, options
or warrants; or
(iii) there shall be any reclassification of the Common Equity
Shares (other than an event to which subparagraph (d)(i) of this
Section 6 applies) or any consolidation or merger to which the
Corporation is a party (other than a merger in which the Corporation
is the surviving entity) and for which approval of any shareholders of
the Corporation is required, or a statutory share exchange, or a self
tender offer by the Corporation for all or substantially all of its
outstanding Common Shares or the sale or transfer of all or
substantially all of the assets of the Corporation as an entirety; or
(iv) there shall occur the voluntary or involuntary liquidation,
dissolution or winding up of the Corporation;
then the Corporation shall cause to be filed with the Transfer Agent and
shall cause to be mailed to the holders of Series D Equity Shares at their
addresses as shown on the records of the Corporation, as promptly as
possible, but at least 10 days prior to the applicable date hereinafter
specified, a notice stating (A) the date on which a record is to be taken
for the purpose of such dividend, distribution or granting of rights,
options or warrants, or, if a record is not to be taken, the date as of
which the holders of Common Equity Shares of record to be entitled to such
dividend, distribution or rights, options or warrants are to be determined
or (B) the date on which such reclassification, consolidation, merger,
statutory share exchange, sale, transfer, liquidation, dissolution or
winding up is expected to become effective, and the date as of which it is
expected that holders of Common Equity Shares of record shall be entitled
to exchange their Common Equity Shares for securities or other property, if
any, deliverable upon such reclassification, consolidation, merger,
statutory share exchange, sale, transfer, liquidation, dissolution or
winding up. Failure to give or receive such notice or any defect therein
shall not affect the legality or validity of the proceedings described in
this Section 6.
(g) Whenever the Conversion Price is adjusted as herein provided, the
Corporation shall promptly file with the Transfer Agent an officer's
certificate setting forth the Conversion Price after such adjustment and
setting forth a brief statement of the facts requiring such adjustment
which certificate shall be conclusive evidence of the correctness of such
adjustment absent manifest error. Promptly after delivery of such
certificate, the Corporation shall prepare a notice of such adjustment of
the Conversion Price setting forth the adjusted Conversion Price and the
effective date of such adjustment and shall mail such notice of such
adjustment of the Conversion Price to the holder of each share of Series D
Equity Shares at such holder's last address as shown on the records of the
Corporation.
(h) In any case in which paragraph (d) of this Section 6 provides
that an adjustment shall become effective on the day next following the
record date for an event, the Corporation may defer until the occurrence of
such event (A) issuing to the holder of any share of Series D Equity Shares
converted after such record date and before the occurrence of such event
the additional Common Equity Shares issuable upon such conversion by reason
of the adjustment required by such event over and above the Common Equity
Shares issuable upon such conversion before giving effect to such
adjustment and (B) paying to such holder any amount of cash in lieu of any
fraction pursuant to paragraph (c) of this Section 6.
(i) There shall be no adjustment of the Conversion Price in case of
issuance of any stock of the Corporation in a reorganization, acquisition
or other similar transaction except as specifically set forth in this
Section 6. If any action or transaction would require adjustment of the
Conversion Price pursuant to both paragraph (d) and paragraph (e) of this
Section 6, only one adjustment shall be made and such adjustment shall be
the amount of adjustment that has the highest absolute value.
(j) If the Corporation shall take any action affecting the Common
Equity Shares, other than action described in this Section 6, that in the
opinion of the Board of Directors would materially and adversely affect the
conversion rights of the holders of the Series D Equity Shares, the
Conversion Price for the Series D Equity Shares may be adjusted, to the
extent permitted by law, in such manner, if any, and at such time, as the
Board of Directors, in its sole discretion, may determine to be equitable
in the circumstances.
(k) The Corporation covenants that it will at all times reserve and
keep available, free from preemptive rights, out of the aggregate of its
authorized but unissued Common Equity Shares, for the purpose of effecting
conversion of the Series D Equity Shares, the full number of Common Equity
Shares deliverable upon the conversion of all outstanding Series D Equity
Shares not theretofore converted. For purposes of this paragraph (k), the
number of Common Shares that shall be deliverable upon the conversion of
all outstanding Series D Preferred Shares shall be computed as if at the
time of computation all such outstanding shares were held by a single
holder.
Any Common Equity Shares issued upon conversion of the Series D Equity
Shares shall be validly issued, fully paid and non-assessable. Before
taking any action that would cause an adjustment reducing the Conversion
Price below the then-par value of the Common Equity Shares deliverable upon
conversion of the Series D Equity Shares, the Corporation will take any
action that, in the opinion of its counsel, may be necessary in order that
the Corporation may validly and legally issue fully paid and (subject to
any customary qualification based upon the nature of a real estate
investment trust) nonassessable Common Equity Shares at such adjusted
Conversion Price.
The Corporation shall use its best efforts to list the Common Shares
required to be delivered upon conversion of the Series D Preferred Shares,
prior to such delivery, upon each national securities exchange, if any,
upon which the outstanding Common Shares are listed at the time of such
delivery.
The Corporation shall use its best efforts to comply with all federal
and state securities laws and regulations thereunder in connection with the
issuance of any securities that the Corporation shall be obligated to
deliver upon conversion of the Series D Equity Shares. The certificates
evidencing such securities shall bear such legends restricting transfer
thereof in the absence of registration under applicable securities laws or
an exemption therefrom as the Corporation may in good faith deem
appropriate.
(l) The Corporation will pay any and all documentary stamp or similar
issue or transfer taxes payable in respect of the issue or delivery of
Common Equity Shares or other securities or property on conversion of the
Series D Equity Shares pursuant hereto; provided, however, that the
Corporation shall not be required to pay any tax that may be payable in
respect of any transfer involved in the issue or delivery of Common Shares
or other securities or property in a name other than that of the holder of
the Series D Equity Shares to be converted, and no such issue or delivery
shall be made unless and until the Person requesting such issue or delivery
has paid to the Corporation the amount of any such tax or established, to
the reasonable satisfaction of the Corporation, that such tax has been
paid.
Section 7. Change of Control. (a) If a Change of Control (as
defined below) occurs (a "Change of Control Repurchase Event"), the holders
of Series D Equity Shares shall have the right to require the Corporation,
to the extent the Corporation shall have funds legally available therefor,
to redeem any or all of the Series D Equity Shares held by such holder at a
repurchase price payable in cash (the "Change of Control Repurchase
Payment") in an amount equal to 105% of the Liquidation Preference thereof,
plus accrued and unpaid dividends whether or not declared, if any, to the
date of repurchase or the date payment is made available (the "Change of
Control Date"), pursuant to the offer described in subsection (b) below
(the "Change of Control Repurchase Offer").
(b) Within 15 days following the Corporation becoming aware that a
Change of Control Repurchase Event has occurred, the Corporation shall mail
by first class mail or recognized overnight courier a notice to the each
holder of Series D Equity Shares stating (A) that a Change of Control
Repurchase Event has occurred and that such holder has the right to require
the Corporation to repurchase any or all of the Series D Equity Shares then
held by such bolder, (B) the date of repurchase (which shall be a Business
Day, no earlier than 30 days and no later than 60 days from the date such
notice is mailed, or such later date as may be necessary to comply with the
requirements of the Exchange Act), (C) the repurchase price and (D) the
instructions determined by the Corporation, consistent with this
subsection, that such investor must follow in order to have the Series D
Equity Shares repurchased.
(c) On the Change of Control Repurchase Date, the Corporation, to the
extent lawful, shall accept for payment Series D Equity Shares or portions
thereof tendered by such holder pursuant to the Change of Control
Repurchase Offer and promptly by wire transfer of immediately available
funds to such holder, as directed by such holder, send an amount equal to
the Change of Control Repurchase Payment in respect of all Series D Equity
Shares or portions thereof so tendered.
(d) Notwithstanding anything else herein, to the extent they are
applicable to any Change of Control Repurchase Offer, the Corporation will
comply with any federal and state securities laws, rules and regulations
and all time periods and requirements shall be adjusted accordingly.
(e) For purposes hereof, "Change of Control" means the occurrence of
any of the following: (i) the first acquisition, directly or indirectly,
by any individual or entity or group (as such term is used in Section
13(d)(3) of the Exchange Act) of beneficial ownership (as defined in Rule
13d-3 under the Exchange Act, except that such individual or entity shall
be deemed to have beneficial ownership of all shares that any such
individual or entity has the right to acquire, whether such right is
exercisable immediately or only after passage of time) of more than 25% of
the Corporation's outstanding stock with voting power, under ordinary
circumstances, to elect Directors of the Corporation, (ii) during any
period of two consecutive years, individuals who at the beginning of such
period constituted the Board of Directors of the Corporation (together with
any new Directors whose election by such Board of Directors or whose
nomination for election by the shareholders of the Corporation was approved
by a vote of 66 2/3% of the Directors of the Corporation then still in
office who were either Directors at the beginning of such period, or whose
election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the Board of Directors then in
office of the Corporation; and (iii) (A) the Corporation consolidating with
or merging into another entity or conveying, transferring or leasing all or
substantially all of its assets (including, but not limited to, real
property investments) to any individual or entity, or (B) any entity
consolidating with or merging into the Corporation, which in either event
(A) or (B) is pursuant to a transaction in which the outstanding voting
stock of the Corporation is reclassified or changed into or exchanged for
cash, securities or other property; provided, however, that the events
described in clauses (i)(ii) and (iii) shall not be deemed to be a Change
of Control (a) in the case of an event described in clause (iii), if the
sole purpose of such event is that the Corporation is seeking to change its
domicile or to convert from a corporation to a trust or vice versa; (b) in
the case of an event described in clause (iii), if the holders of the
exchanged securities of the Corporation immediately after such transaction
beneficially own at least a majority of the securities of the merged or
consolidated entity normally entitled to vote in elections of Directors of
the Corporation; (c) if any of WHL or its wholly-owned subsidiaries remain
as manager of the Corporation's properties and remains as adviser of the
Corporation, in each case, in a manner substantially similar to that on
date hereof; or (d) if the Change of Control results solely from the
purchase or other acquisition of equity securities by WHL or its wholly-
owned subsidiaries, Westfield America Trust, the Lowy Family or the
Investor or the sale of equity securities by WHL or any of its wholly-owned
subsidiaries or Westfield America Trust.
Section 8. Redemption at the Option of the Holder. (a) At any time
after August 12, 2008,(2) the holders of Series D Equity Shares thereof shall
have the right at any time that the Corporation's Common Shares has a
Current Market Price at or below and the Conversion Price per share, to
require the Corporation, to the extent the Corporation shall have funds
legally available therefor, to redeem any or all of the Series D Equity
Shares held by such holder at a repurchase price payable, at the option of
the Corporation, in either (i) cash, or (ii) such number of Common Equity
Shares as shall have a Current Market Price in the aggregate on the day
prior to the day such holder gives notice pursuant to Section 8(b) of its
intention to redeem, equal to in either case, 100% of the Liquidation
Preference thereof plus accrued and unpaid dividends whether or not
declared, if any, to the date of repurchase or the date payment is made
available (in the aggregate, the "Redemption Payment").
----------------
2. This date is the tenth anniversary of the Closing hereunder.
(b) Notwithstanding paragraph (a) of this Section 8, in the event
that WHL and its subsidiaries and the trustee of Westfield America Trust on
behalf of Westfield America Trust vote to approve the conversion of the
Series D Equity Shares into Common Equity Shares at a meeting of
shareholders at which such proposal is raised, but the shareholders of the
Corporation as a whole reject the foregoing proposal, then from and after
the later of such rejection date and the second anniversary of the Issue
Date, the Series D Equity Stock shall be redeemable at the option of the
holder, to the extent that the Corporation shall have funds legally
available therefor, at a redemption price payable in cash equal to the
product of (a) the Series D Common Equivalent Factor times (b) the Current
Market Price on the date of the notice provided pursuant to paragraph (c)
below, plus all accumulated, accrued and unpaid dividends whether or not
declared, if any, to the date of repurchase or the date payment is made
available.
(c) For purposes of this Section 8, redemption at the option of the
holder shall be deemed to occur upon receipt by the Corporation of written
notice that the holder of Series D Equity Shares wishes to tender shares to
be redeemed. The holders of such shares to be redeemed shall then have 30
days from the date of such notice to deliver such shares to the Transfer
Agent. Upon the surrender of the certificate or certificates of Series D
Equity Shares to be redeemed, duly endorsed or assigned to the Corporation
or in blank, at the office of the Transfer Agent, the Corporation shall
promptly, either (i) by wire transfer of immediately available funds to
such holder, as directed by such holder, send an amount equal to the
Redemption Payment in respect of all Series D Equity Shares or portions
thereof so tendered or (ii) issue and deliver to such holder, or on his or
her written order, a certificate or certificates for the number of full
Common Equity Shares issuable in respect of all Series D Equity Shares or
portions thereof so tendered.
Section 9. Shares To Be Retired. All Series D Equity Shares which
shall have been issued and reacquired in any manner by the Corporation
shall be restored to the status of authorized but unissued preferred stock,
without discretion as to class or series, and subject to applicable
limitations set forth in the Articles may thereafter be reissued as shares
of any series of preferred stock.
Section 10. Ranking. Any class or series of stock of the Corporation
shall be deemed to rank:
(a) prior to the Series D Preferred Shares, as to the payment of
dividends and as to distribution of assets upon liquidation, dissolution
or winding up, if the holders of such class or series shall be entitled
to the receipt of dividends or of amounts distributable upon
liquidation, dissolution or winding up, as the case may be, in
preference or priority to the holders of Series D Preferred Shares,
which shall expressly include the Corporation's non-voting senior
preferred stock, par value $1.00 per share;
(b) on a parity with the Series D Preferred Shares, as to the
payment of dividends and as to distribution of assets upon liquidation,
dissolution or winding up, whether or not the dividend rates, dividend
payment dates or redemption or liquidation prices per share thereof
shall be different from those of the Series D Preferred Shares, if the
holders of such class or series and the Series D Preferred Shares shall
be entitled to the receipt of dividends and of amounts distributable
upon liquidation, dissolution or winding up in proportion to their
respective amounts of accrued and unpaid dividends per share or
liquidation preferences, without preference or priority one over the
other ("Parity Shares"), which shall expressly include the Corporation's
Series A Cumulative Redeemable Preferred Shares, Series B Cumulative
Redeemable Preferred Shares and Series C Cumulative Convertible
Preferred Stock;
(c) junior to the Series D Preferred Shares, as to the payment of
dividends or as to the distribution of assets upon liquidation,
dissolution or winding up, if such class or series shall be Junior
Shares; and
(d) junior to the Series D Preferred Shares, as to the payment of
dividends and as to the distribution of assets upon liquidation,
dissolution or winding up, if such class or series shall be Fully Junior
Shares.
Section 11. Voting. So long as any Series D Equity Shares are
outstanding, in addition to any other vote or consent of shareholders
required by law or by the Articles, the affirmative vote of the holders of
a majority of the Series D Equity Shares, voting together as a class, given
in person or by proxy, either in writing without a meeting or by vote at
any meeting called for the purpose, shall be necessary for effecting or
validating:
(i) Any amendment, alteration or repeal of any of the provisions
of the Articles of Incorporation or this Certificate of Designation
that materially and adversely affects the voting powers, rights or
preferences of the holders of the Series D Equity Shares; or
(ii) Any merger or consolidation of the Corporation and another
entity in which the Corporation is not the surviving corporation and
each holder of Series D Equity Shares does not receive shares of the
surviving corporation with substantially similar rights, preferences
and powers in the surviving corporation as the Series D Equity Shares
have with respect to the Corporation (except for changes that do not
materially and adversely affect the holders of the Series D Equity
Stock).
provided, however, that no such vote of the holders of Series D Equity
Shares shall be required if, at or prior to the time when such
amendment, alteration or repeal is to take effect, or when the
issuance of any such prior shares or convertible security is to be
made, as the case may be, provision is made for the redemption of all
Series D Equity Shares at the time outstanding to the extent such
redemption is authorized by Section 5 of this Certificate of
Designation.
(iii) For purposes of the foregoing provisions of this Section
13, each share of Series D Equity Shares shall have one (1) vote per
share, except that when any other series of Equity Shares shall have
the right to vote with the Series D Equity Shares as a single class on
any matter, then the Series D Equity Shares and such other series
shall have with respect to such matters one (1) vote per $180.00 (or
less pursuant to Section 4(a)) of stated Liquidation Preference.
Except as otherwise required by applicable law or as set forth herein,
the Series D Equity Shares shall not have any relative, participating,
optional or other special voting rights and powers other than as set
forth herein, and the consent of the holders thereof shall not be
required for the taking of any corporate action.
Section 12. Record Holders. The Corporation and the Transfer Agent
may deem and treat the record holder of any Series D Preferred Shares as
the true and lawful owner thereof for all purposes, and neither the
Corporation nor the Transfer Agent shall be affected by any notice to the
contrary.
Section 13. Title. This resolution shall be known and may be
referred to as "A Resolution of the Board of Directors of Westfield
America, Inc. Designating Series D Preferred Shares and Fixing Preferences
and Rights Thereof."
FURTHER RESOLVED, that the appropriate officers of the Corporation are
hereby authorized and directed to execute and acknowledge a certificate
setting forth these resolutions and to cause such certificate to be filed
and recorded, all in accordance with the requirements of Section 351.046 of
the General and Business Corporation Law of the State of Missouri, as
amended.
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation to be duly executed by its Co-President this 10 day of August,
1998.
WESTFIELD AMERICA, INC.
By: /s/ Peter S. Lowy
------------------------
Name: Peter S. Lowy
Title: Co-President
CORPORATE ACKNOWLEDGMENT
STATE OF CALIFORNIA )
) SS:
COUNTY OF LOS ANGELES )
I, Annie M. Gary, a notary public, do hereby certify that on this 6
day of August, 1998, personally appeared before me Peter Lowy, and being
first duly sworn by me, declared that he is the Co-President of Westfield
America, Inc., that he signed the foregoing document as Co-President of the
corporation, and that the statements therein contained are true.
[SEAL] /s/ Annie M. Gary
---------------------------
Notary Public
My Commission Expires: March 31, 2000
CERTIFICATE OF DESIGNATION
SETTING FORTH "RESOLUTION DESIGNATING
SERIES D-1 PREFERRED SHARES
AND FIXING PREFERENCES AND RIGHTS THEREOF"
ADOPTED BY THE BOARD OF DIRECTORS OF
WESTFIELD AMERICA, INC.
Pursuant to the Provisions of Section 351.180 (7) of the
General and Business Corporation Law of the State
of Missouri, as amended,
I, the undersigned, Co-President of Westfield America, Inc., a
Missouri corporation (hereinafter sometimes referred to as the
"Corporation"), hereby certify as follows:
FIRST: that under the provisions of Article Fourth of the Restated
Articles of Incorporation, as amended, of the Corporation, the total number
of shares of all classes of capital stock which the Corporation may issue
is 410,000,200 shares, of which (i) 200 shares shall be non-voting senior
preferred stock, par value $1.00 per share (the "Senior Preferred Shares"),
(ii) 5,000,000 shares shall be Preferred Shares, with par value of $1.00
per share (the "Preferred Shares"), 940,000 of which have been designated
as Series A Preferred Shares, with a liquidation value of $100 per share
(the "Series A Preferred Shares") and 400,000 of which have been designated
as Series B Preferred Shares, with a liquidation value of $100 per share
(the "Series B Preferred Shares"), 416,667 of which have been designated as
Series C Preferred Shares, with a liquidation value of $180 per share (the
"Series C Preferred Shares") and 694,445 of which have been designated as
Series D Preferred Shares, with a liquidation value of $180 per share (the
"Series D Preferred Shares") (iii) 200,000,000 shall be shares of common
stock, par value $.01 per share (the "Common Shares"), (iv) 205,000,000
will be shares of excess stock, par value $.01 ("Excess Shares"). Any
Excess Shares which are issued with respect to Common Stock shall be
"Excess Common Shares" and, together with the Common Shares, the "Common
Equity Shares" and any Excess Shares which are issued with respect to
Preferred Shares shall be "Excess Preferred Shares", and, together with the
Preferred Shares, the "Preferred Equity Shares" and under said Articles of
Incorporation (as amended, the "Articles of Incorporation"), the shares of
Preferred Stock are authorized to be issued by the Board of Directors and
the Board of Directors is expressly authorized to determine in the
Resolution, the designation, powers, rights, preferences and
qualifications, limitations or restrictions, not fixed and determined by
the Articles of Incorporation.
SECOND: That the Board of Directors of the Corporation pursuant to
the authority so vested in it by Article Fourth of the Certificate of
Incorporation, and in accordance with the provisions of Section 351.180 (7)
of the General and Business Corporation Law of the State of Missouri, as
amended, adopted on December 14, 1998 the following resolution creating a
series of Preferred Stock designated as "Series D-1 Preferred Shares,"
which resolution has not been amended, modified, rescinded or revoked and
is in full force and effect on the date hereof.
"RESOLUTION OF THE BOARD OF DIRECTORS OF
WESTFIELD AMERICA, INC. DESIGNATING
'SERIES D-1 PREFERRED SHARES'
AND FIXING PREFERENCES AND RIGHTS THEREOF"
BE IT RESOLVED, that pursuant to authority expressly granted to and
vested in the Board of Directors of Westfield America, Inc., hereinafter
called the "Corporation," by the provisions of the Articles of
Incorporation, as amended, the Board of Directors of the Corporation hereby
fixes the designation, voting powers, rights on liquidation or dissolution
and other preferences and rights, and the qualifications, limitations or
restrictions thereof, of the shares of such series (in addition to the
designations, preferences and relative rights, and the qualifications,
limitations or restrictions thereof set forth in the Articles of
Incorporation which are applicable to the Series D-1 Preferred Shares) as
follows:
Section 1. Number of Shares, Designation and Ranking. This class of
preferred stock shall be designated as Series D-1 Cumulative Convertible
Redeemable Preferred Stock and the number of shares which shall constitute
such series shall not be more than 138,889 shares, par value $1.00 per
share, which number may be decreased (but not below the aggregate number
thereof then outstanding and/or which have been reserved for issuance) from
time to time by the Board of Directors and is hereafter in this resolution
called the "Series D-1 Preferred Shares." Each Series D-1 Preferred Share
shall be identical in all respects to each other Series D Preferred Share.
Each Excess Series D-1 Preferred Share shall be identical in all respects
to each other Excess Series D-1 Preferred Share, and except as otherwise
provided herein, shall be identical in all respects to each Series D-1
Preferred Share (the Series D-1 Preferred Shares together with the Excess
Series D-1 Preferred Shares being hereinafter referred to as the "Series D-
1 Equity Shares").
Section 2. Definitions. For purposes of the Series D-1 Preferred
Shares, the following terms shall have the meanings indicated:
"Affiliate" of, or Person "Affiliated" with, a specified Person, shall
mean a Person that directly or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control
with the Person specified. For purposes of the Corporation, Affiliate
shall include, without limitation, Westfield Holdings Limited ("WHL"),
Westfield America Trust, Frank Lowy, David Lowy, Peter Lowy and Steven Lowy
(such individuals being the "Lowy Family").
"Base Rate" shall mean an annual dividend per Series D-1 Equity Share
equal to 8.5% of the Liquidation Preference per Series D-1 Equity Share.
"Board of Directors" shall mean the Board of Directors of the
Corporation or any committee authorized by such Board of Directors to
perform any of its responsibilities with respect to the Series D-1
Preferred Shares.
"Business Day "shall mean any day, other than a Saturday or Sunday,
that is neither a legal holiday nor a day on which banking institutions in
New York City, New York are authorized or required by law, regulation or
executive order to close.
"Call Date" shall mean the date specified in the notice to holders
required under Section 5(d) as the Call Date.
"Code "shall mean the Internal Revenue Code of 1986, as amended.
"Consolidated EBITDA" for any quarter shall mean the consolidated net
income of the Corporation (before extraordinary income or gains and less
equity in income of unconsolidated real estate partnerships), calculated in
a manner consistent with the Corporation's financial statements filed with
the Securities and Exchange Commission, increased by the sum of the
following (without duplication):
a. the Corporation's pro rata share of EBITDA from unconsolidated
real estate partnerships calculated in a manner consistent with
this definition of Consolidated EBITDA,
b. all income taxes paid or accrued according to GAAP for such
quarter (other than income taxes attributable to extraordinary.
unusual or non-recurring gains or losses except to the extent that
such gains were not included in Consolidated EBITDA),
c. all interest expense paid or accrued in accordance with GAAP for
such quarter (including financing fees and amortization of
deferred financing fees or amortization of original issue
discount, but excluding capitalized interest),
d. depreciation and depletion reflected in such net income,
e. amortization reflected in such net income including, without
limitation, amortization of capitalized debt issuance costs (only
to the extent that such amounts have not been previously included
in the amount of Consolidated EBITDA pursuant to clause (c)
above), goodwill, other intangibles and management fees, and
f. any other non-cash charges, to the extent deducted from
consolidated net income (including, but not limited to, income
allocated to minority interests).
"Consolidated Fixed Charges" for any quarter shall mean the sum of:
a. the Corporation's pro rata share of fixed charges from
unconsolidated real estate partnerships calculated in a manner
consistent with this definition of Consolidated Fixed Charges,
b. all interest expense paid or accrued in accordance with GAAP for
such quarter including, without duplication, financing fees and
amortization of deferred financing fees or amortization of
original issue discount),
c. dividend and distribution requirements with respect to preferred
stock (not including any portion of preferred stock dividends the
calculation of which is based on the dividend paid in such quarter
to the holders of common shares) whether or not declared or paid,
d. regularly scheduled amortization of principal of debt during such
quarter (other than any balloon payments at maturity), and
e. all ground rent payments.
"Constituent Person" shall have the meaning set forth in Section 6(e).
"Conversion Date" shall have the meaning set forth in Section 6(a).
"Conversion Price" shall mean the conversion price per Common Equity
Share for which the Series D-1 Equity Share is convertible, as such
Conversion Price may be adjusted pursuant to Section 6. The initial
conversion price shall be $18.00.
"Current Market Price" of publicly traded Common Shares or any other
class of stock or other security of the Corporation or any other issuer for
any day shall mean the last reported sales price, regular way, on such day,
or, if no sale takes place on such day, the average of the reported closing
bid and asked prices on such day, regular way, in either case as reported
on the New York Stock Exchange ("NYSE") or, if such security is not listed
or admitted for trading on the NYSE, on the principal national securities
exchange on which such security is listed or admitted for trading or, if
not listed or admitted for trading on any national securities exchange, on
the Nasdaq National Market ("NASDAQ") or, if such security is not quoted on
NASDAQ, the average of the closing bid and asked prices on such day in the
over-the-counter market as reported by the National Association of
Securities Dealers, Inc. (the "NASD") or, if bid and asked prices for such
security on such day shall not have been reported through the NASD, the
average of the bid and asked prices on such day as furnished by any NYSE
member firm regularly making a market in such security selected for such
purpose by the Board of Directors.
"Dividend Payment Date" shall mean (i) for any Dividend Period with
respect to which the Corporation pays a dividend on the Common Equity
Shares, the date on which such dividend is paid, or (ii) for any Dividend
Period with respect to which the Corporation does not pay a dividend on the
Common Equity Shares, a date to be set by the Board of Directors, which
date shall not be later than the thirtieth calendar day after the end of
the applicable Dividend Period.
"Dividend Period" shall mean quarterly dividend periods commencing on
January 1, April 1, July 1 and October 1 of each year and ending on and
including the day preceding the first day of the next succeeding Dividend
Period with respect to any Series D-1 Equity Shares (other than the initial
Dividend Period, which shall commence on the Issue Date for such Series D-1
Equity Shares and end on and include the last day of the calendar quarter
immediately following such Issue Date, and other than the Dividend Period
during which any Series D-1 Equity Shares shall be redeemed pursuant to
Section 5 or converted pursuant to Section 6, which shall end on and
include the Call Date or Conversion Date with respect to the Series D-1
Equity Shares being redeemed or converted, as applicable).
"Expiration Time" shall have the meaning set forth in Section
6(d)(iv).
"Fair Market Value" shall mean the average of the daily Current Market
Prices of a Common Share on the five (5) consecutive Trading Days selected
by the Corporation commencing not more than 20 Trading Days before, and
ending not later than, the earlier of the day in question and the day
before the "ex date" with respect to the issuance or distribution requiring
such computation. The term "ex date," when used with respect to any
issuance or distribution, means the first day on which the Common Shares
trade regular way, without the right to receive such issuance or
distribution on the exchange or in the market, as the case may be, used to
determine that day's Current Market Price.
"Fixed Charge Coverage Violation" shall have the meaning set forth in
Section 3(a).
"Fully Junior Shares" shall mean the Common Shares and any other class
or series of stock of the Corporation now or hereafter issued and
outstanding over which the Series D-1 Preferred Shares preference or
priority in both (i) the payment of dividends and (ii) the distribution of
assets on any liquidation, dissolution or winding up of the Corporation.
"Funds from Operations" shall mean net income (loss) (computed in
accordance with generally accepted accounting principles) excluding gains
(or losses) from debt restructuring, and distributions in excess of
earnings allocated to other operating partnership interests or minority
interests (as reflected in the financial statements of the Corporation)
plus depreciation/amortization of assets unique to the real estate
industry, all computed in a manner consistent with the revised definition
of Funds From Operations adopted by the National Association of Real Estate
Investment Trusts (NAREIT), in its White Paper dated March 1995, as such
definitions may be modified from time to time.
"Investor" shall mean Security Capital Preferred Growth Incorporated
and controlled affiliates thereof.
"Issue Date" shall mean the date on which Series D-1 Preferred Stock
is issued.
"Junior Shares" shall mean the Common Shares and any other class or
series of stock of the Corporation now or hereafter issued and outstanding
over which the Series D-1 Preferred Shares have preference or priority in
the payment of dividends or in the distribution of assets on any
liquidation, dissolution or winding up of the Corporation.
"Non-Electing Share" shall have the meaning set forth in Section 6(e).
"Operating Partnership" shall mean Westfield America Limited
Partnership, a Delaware limited partnership.
"Parity Shares" shall have the meaning set forth in Section 10(b).
"Person" shall mean any individual, firm, partnership, corporation,
limited liability company, trust or other entity, and shall include any
successor (by merger or otherwise) of such entity.
"Purchased Shares" shall have the meaning set forth in Section
6(d)(iv).
"REIT Termination Event" shall mean the earliest to occur of:
(i) the filing of a federal income tax return by the Corporation
for any taxable year on which the Corporation does not compute
its income as a real estate investment trust,
(ii) the approval by the shareholders of the Corporation of a
proposal for the Corporation to cease to qualify as a real
estate investment trust,
(iii) a determination by the Board of Directors of the Corporation,
based on the advice of counsel, that the Corporation has
ceased to qualify as a real estate investment trust, or
(iv) a "determination" within the meaning of Section 1313(a) of the
Code that the Corporation has ceased to qualify as a real
estate investment trust.
"Securities" and "Security" shall have the meanings set forth in
Section 6(d)(iii).
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Series D-1 Preferred Shares" shall have the meaning given such term
in Section 1of the Certificate of Designation.
"set apart for payment" shall be deemed to include, without any action
other than the following, the recording by the Corporation in its
accounting ledgers of any accounting or bookkeeping entry which indicates,
pursuant to a declaration of dividends or other distribution by the Board
of Directors, the allocation of funds to be so paid on any series or class
of stock of the Corporation; provided, however, that if any funds for any
class or series of Junior Shares or any class or series of stock ranking on
a parity with the Series D-1 Preferred Shares as to the payment of
dividends are placed in a separate account of the Corporation or delivered
to a disbursing, paying or other similar agent, then "set apart for
payment" with respect to the Series D-1 Preferred Shares shall mean placing
such funds in a separate account or delivering such funds to a disbursing,
paying or other similar agent.
"Trading Day" shall mean any day on which the securities in question
are traded on the NYSE, or if such securities are not listed or admitted
for trading on the NYSE, on the principal national securities exchange on
which such securities are listed or admitted, or if not listed or admitted
for trading on any national securities exchange, on NASDAQ, or if such
securities are not quoted on NASDAQ, in the securities market in which the
securities are traded.
"Transaction" shall have the meaning set forth in Section 6(e).
"Transfer Agent" shall mean the Corporation, or such other agent or
agents of the Corporation as may be designated by the Board of Directors or
their designee as the transfer agent, registrar and dividend disbursing
agent for Series D-1 Preferred Shares and notified to the holders of the
Series D-1 Preferred Stock.
Capitalized terms not otherwise defined herein have the meanings ascribed
to them in the Articles.
Section 3. Dividends. (a) Subject to the preferential rights of the
holders of any Senior Preferred Stock or Preferred Shares that rank senior
in the payment of dividends to the Series D-1 Equity Shares and subject to
paragraph (b) of this Section 3, the holders of Series D-1 Equity Shares
shall be entitled to receive, when, as and if declared by the Board of
Directors, but only out of funds legally available for the payment of
dividends, cumulative preferential dividends payable in cash to
shareholders of record on the respective date, not exceeding 50 days
preceding such dividend payment date, fixed for the purpose by the Board of
Directors in advance of payment of each particular dividend in an amount
equal to the greater of (A) the Base Rate per share per annum and (B) an
amount per share equal to the Liquidation Preference of a Series D-1 Equity
Share (exclusive of accrued but unpaid dividends) divided by the Conversion
Price (the "Series D-1 Common Equivalent Factor") times the dollar amount
of cash dividends declared with respect to each Common Equity Share that
does not result in an adjustment to the Conversion Price pursuant to
subparagraph (d)(iii) of Section 6 (such product, the "Series D Common
Equivalent Amount") for the same annual period; provided, however, that if
as a result of the quarterly dividends paid in accordance with the
following sentence, the holders of Series D-1 Equity Shares shall have
received for any calendar year more dividends than such Series D-1 Equity
Shares shall be entitled under clauses (A) and (B) above (as adjusted
pursuant to the third and eighth sentences of this Section 3), the
dividends payable in respect of Series D-1 Equity Shares in subsequent
calendar years shall be reduced to the extent of such overpayment. Subject
to the proviso of the preceding sentence of this Section 3(a), the dividend
paid in respect of each quarterly period in each calendar year shall be
determined as follows (in each case, excluding any additional payment made
pursuant to the following sentence): (1) for the first quarter, the
greater of 25% of the Base Rate per share and the Series D-1 Common
Equivalent Amount for the same quarter; (2) for the second quarter, an
amount such that the aggregate amount to be received per Series D-1 Equity
Share in respect of the first two quarters of such calendar year shall be
the greater of 50% of the Base Rate per share and the Series D-1 Common
Equivalent Amount for the same two quarters; (3) for the third quarter, an
amount such that the aggregate amount to be received per Series D-1 Equity
Share in respect of the first three quarters of such calendar year shall be
the greater of 75% of the Base Rate per share and the Series D-1 Common
Equivalent Amount for the same three quarters; and (4) for the fourth
quarter, an amount such that the aggregate amount to be received per Series
D-1 Equity Share in respect of such calendar year shall be the amount
provided in the preceding sentence of this Section 3(a). Notwithstanding
the foregoing, for any quarter in which a Fixed Charge Coverage Violation
(as defined below) has occurred, the dividend payable per Series D-1 Equity
Share shall be 1.20 times the amount provided in the preceding sentence. A
"Fixed Charge Coverage Violation" shall occur for any quarter that the
ratio of the Corporation's Consolidated EBITDA to its Consolidated Fixed
Charges is below 1.40 to 1. The dividends shall begin to accrue as set
forth above and shall be fully cumulative from the first day of the
applicable Dividend Period, whether or not in any Dividend Period or
Periods there shall be funds of the Corporation legally available for the
payment of such dividends, and shall be payable quarterly, when, as and if
declared by the Board of Directors, in arrears on Dividend Payment Dates.
Accumulated but unpaid dividends for any past quarterly dividend periods
may be declared and paid at any time, without reference to any regularly
scheduled quarterly dividend payment date, to holders of record on such
date, not exceeding 50 days preceding such payment date, fixed for the
purpose by the Board of Directors in advance of payment of each particular
dividend. Any dividend payment made on Series D-1 Equity Shares shall
first be credited against the earliest accrued but unpaid dividend due with
respect to Series D-1 Equity Shares which remains payable. Beginning with
the quarter in which a REIT Termination Event occurs, all dividends payable
per Series D-1 Equity Share pursuant to this Section shall be multiplied by
2.5.
(b) The initial Dividend Period for the Series D-1 Equity Shares will
include a partial dividend for the period from the Issue Date until the
last day of the calendar quarter immediately following such Issue Date.
The amount of dividends payable for such initial period, or any other
period shorter than a full quarterly Dividend Period, on the Series D-1
Equity Shares shall be computed by dividing the number of days in such
period by 90 and multiplying the result by the Series D-1 Equity dividend
determined in accordance with Section 3(a). Holders of Series D-1 Equity
Shares shall not be entitled to any dividends, whether payable in cash,
property or shares, in excess of cumulative dividends, as herein provided,
on the Series D-1 Equity Shares. No interest, or sum of money in lieu of
interest, shall be payable in respect of any dividend payment or payments
on the Series D-1 Equity Shares which may be in arrears.
(c) So long as any Series D-1 Equity Shares remain outstanding, no
dividends, except as described in the immediately following sentence, shall
be declared or paid or set apart for payment on any class or series of
Parity Shares for any period unless full cumulative dividends have been or
contemporaneously are declared and paid or declared and a sum sufficient
for the payment thereof set apart for such payment on the Series D-1 Equity
Shares for all Dividend Periods terminating on or prior to the dividend
payment date on such class or series of Parity Shares. When dividends are
not paid in full or a sum sufficient for such payment is not set apart, as
aforesaid, all dividends declared upon Series D-1 Equity Shares and all
dividends declared upon any other class or series of Parity Shares shall be
declared ratably in proportion to the respective amounts of dividends
accumulated and unpaid on the Series D-1 Equity Shares and accumulated and
unpaid on such Parity Shares.
(d) So long as any Series D-1 Equity Shares remain outstanding, no
dividends (other than dividends or distributions paid solely in Fully
Junior Shares, or options, warrants or rights to subscribe for or purchase,
Fully Junior Shares) shall be declared or paid or set apart for payment or
other distribution shall be declared or made or set apart for payment upon
Junior Shares, nor shall any Junior Shares be redeemed, purchased or
otherwise acquired (other than a redemption, purchase or other acquisition
of Common Shares made for purposes of an employee incentive or benefit plan
of the Corporation or any subsidiary) for any consideration (or any moneys
be paid to or made available for a sinking fund for the redemption of any
Junior Shares) by the Corporation, directly or indirectly (except by
conversion into or exchange for Fully Junior Shares), unless in each case
the full cumulative dividends on all outstanding Series D-1 Equity Shares
and any other Parity Shares of the Corporation shall have been or
contemporaneously are declared and paid or declared and set apart for
payment for all Dividend Periods terminating on or prior to the date of
declaration or payment with respect to the Series D-1 Equity Shares and all
dividend periods terminating on or prior to the date of declaration or
payment with respect to such Parity Shares. Subject to the foregoing, and
not otherwise, such dividends and distributions may be declared by the
Board of Directors and paid on any Common Equity Shares from time to time
out of any funds legally available therefor, and the Series D-1 Equity
Shares shall not be entitled to participate in any such dividends, whether
payable in cash, stock or otherwise.
(e) No distributions on Series D-1 Equity Shares shall be declared by
the Board of Directors or paid or set apart for payment by the Corporation
at such time as the terms and provisions of any agreement of the
Corporation, including any agreement relating to its indebtedness,
prohibits such declaration, payment or setting apart for payment or
provides that such declaration, payment or setting apart for payment would
constitute a breach thereof or a default thereunder, or if such declaration
or payment shall be restricted or prohibited by law.
(f) In determining whether a distribution by dividend, redemption or
other acquisition of Shares or otherwise is permitted under Missouri law,
no effect shall be given to 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 shareholders whose
preferential rights on dissolution are superior to those receiving the
distribution.
Section 4. Liquidation Preference. (a) In the event of any
liquidation, dissolution or winding up of the Corporation, whether
voluntary or involuntary, subject to the prior preferences and other rights
of any series of stock ranking senior to the Series D-1 Preferred Shares
upon liquidation, distribution or winding up of the Corporation, before any
payment or distribution of the assets of the Corporation (whether capital
or surplus) shall be made to or set apart for the holders of Junior Shares,
the holders of the Series D-1 Equity Shares shall be entitled to receive
One Hundred Eighty Dollars ($180.00) (the "Liquidation Preference") per
Series D-1 Equity Share plus an amount equal to all dividends (whether or
not earned or declared) accrued and unpaid thereon to the date of
liquidation, dissolution or winding up of the affairs of the Corporation
(any such date, a "Series D-1 Liquidation Date") but such holders shall not
be entitled to any further payment; provided, that the dividend payable
with respect to the Dividend Period containing the Series D-1 Liquidation
Date shall be equal to the dividend determined pursuant to Section 3 above
for the preceding Dividend Period times a fraction equal to the actual
number of days elapsed from the end date of the calendar quarter most
recently completed to the relevant Series D-1 Liquidation Date over ninety
days. If, upon any liquidation, dissolution or winding up of the
Corporation, the assets of the Corporation, or proceeds thereof,
distributable among the holders of the Series D-1 Equity Shares shall be
insufficient to pay in full the preferential amount aforesaid and
liquidating payments on any other shares of any class or series of Parity
Shares, then such assets, or the proceeds thereof, shall be distributed
among the holders of Series D-1 Equity Shares and any such other Parity
Shares ratably in accordance with the respective amounts that would be
payable on such Series D-1 Equity Shares and any such other Parity Shares
if all amounts payable thereon were paid in full. For the purposes of this
Section 4, (i) a consolidation or merger of the Corporation with one or
more corporations, real estate investment trusts or other entities, (ii) a
sale, lease or conveyance of all or substantially all of the Corporation's
property or business or (iii) a statutory share exchange shall not be
deemed to be a liquidation, dissolution or winding up, voluntary or
involuntary, of the Corporation.
(b) Subject to the rights of the holders of shares of any series or
class or classes of stock ranking on a parity with (including the Parity
Shares) or prior to the Series D-1 Equity Shares upon liquidation,
dissolution or winding up, upon any liquidation, dissolution or winding up
of the Corporation, after payment shall have been made in full to the
holders of the Series D-1 Equity Shares, as provided in this Section 4, the
holders of Series D-1 Equity Shares shall have no other claim to the
remaining assets of the Corporation and any other series or class or
classes of Junior Shares shall, subject to the respective terms and
provisions (if any) applying thereto, be entitled to receive any and all
assets remaining to be paid or distributed, and the holders of the Series
D-1 Equity Shares shall not be entitled to share therein.
Section 5. Redemption at the Option of the Corporation. (a) The
Series D-1 Equity Shares shall not be redeemable by the Corporation prior
to August 12, 2008. On and after August 12, 2008, the Corporation, at its
option, may redeem the Series D-1 Equity Shares, in whole at any time or
from time to time in part, in minimum increments of $10.0 million of
aggregate Liquidation Preference of such shares, out of funds legally
available therefor at a redemption price payable in cash equal to 100% of
the Liquidation Preference per Series D-1 Equity Share (plus all
accumulated, accrued and unpaid dividends as provided in paragraph (d)
below).
(b) In the event that WHL and its subsidiaries and the trustee of
Westfield America Trust on behalf of Westfield America Trust do not vote to
approve the conversion of the Series D-1 Equity Shares into Common Equity
Shares at the Corporation's 1999 Annual Shareholder Meeting or at any other
meeting of the Corporation's shareholders at which such proposal is raised,
the Corporation shall have the right to redeem the Series D-1 Equity
Shares, in whole or in part, out of funds legally available therefor at a
redemption price payable in cash equal to 100% of the Liquidation
Preference per Series D-1 Equity Share (plus all accumulated, accrued and
unpaid dividends as provided in paragraph (c) below).
(c) Upon any redemption of Series D-1 Equity Shares pursuant to this
Section 5, the Corporation shall pay all accrued and unpaid dividends, if
any, thereon to the Call Date, without interest. If the Call Date falls
after a dividend payment record date and prior to the corresponding
Dividend Payment Date, then each holder of Series D-1 Equity Shares at the
close of business on such dividend payment record date shall be entitled to
the dividend payable on such shares on the corresponding Dividend Payment
Date notwithstanding any redemption of such shares before such Dividend
Payment Date. Except as provided above, the Corporation shall make no
payment or allowance for unpaid dividends, whether or not in arrears, on
Series D-1 Equity Shares called for redemption.
(d) If full cumulative dividends on the Series D-1 Equity Shares and
any other class or series of Parity Shares of the Corporation have not been
declared and paid or declared and set apart for payment, the Series D-1
Equity Shares may not be redeemed under this Section 5 in part and may not
be redeemed unless the Series D Equity Shares are also redeemed in whole
and the Corporation may not purchase or acquire Series D Equity Shares or
Series D-1 Equity Shares, otherwise than pursuant to a purchase or exchange
offer made on the same terms to all holders of Series D Equity Shares and
Series D-1 Equity Shares.
(e) Notice of the redemption of any Series D-1 Equity Shares under
this Section 5 shall be mailed by first-class mail or recognized overnight
courier to each holder of record of Series D-1 Equity Shares to be redeemed
at the address of each such holder as shown on the Corporation's records,
not less than 30 nor more than 90 days prior to the Call Date. Neither the
failure to mail any notice required by this paragraph (e), nor any defect
therein or in the mailing thereof, to any particular holder, shall affect
the sufficiency of the notice or the validity of the proceedings for
redemption with respect to the other holders. Each such mailed notice
shall state, as appropriate: (1) the Call Date; (2) the number of Series D-
1 Equity Shares to be redeemed and, if fewer than all the shares held by
such holder are to be redeemed, the number of such shares to be redeemed
from such holder; (3) the redemption price; (4) the place or places at
which certificates for such shares are to be surrendered; (5) the then-
current Conversion Price; and (6) that dividends on the shares to be
redeemed shall cease to accrue on such Call Date except as otherwise
provided herein. Notice having been mailed as aforesaid, from and after
the Call Date (unless the Corporation shall fail to make available an
amount of cash necessary to effect such redemption), (i) except as
otherwise provided herein, dividends on the Series D-1 Equity Shares so
called for redemption shall cease to accrue, (ii) such shares shall no
longer be deemed to be outstanding, and (iii) all rights of the holders
thereof as holders of Series D-1 Equity Shares shall cease (except the
rights to receive the cash payable upon such redemption, without interest
thereon, upon surrender and endorsement of their certificates if so
required and to receive any dividends payable thereon). The Corporation's
obligation to provide cash in accordance with the preceding sentence shall
be deemed fulfilled if, on or before the Call Date, the Corporation shall
deposit with a bank or trust company that has an office in the Borough of
Manhattan, City of New York, and that has capital and surplus of at least
$150,000,000, necessary for such redemption, in trust, with irrevocable
instructions that such cash be applied to the redemption of the Series D-1
Equity Shares so called for redemption. Notwithstanding the foregoing the
Corporation shall, in the first instance, send the money to any holder of
Series D-1 Equity Shares that has notified the Corporation in writing of
the location of delivery of funds. No interest shall accrue for the
benefit of the holders of Series D-1 Equity Shares to be redeemed on any
cash so set aside by the Corporation. Subject to applicable escheat laws,
any such cash unclaimed at the end of two years from the Call Date shall
revert to the general funds of the Corporation, after which reversion the
holders of such shares so called for redemption shall look only to the
general funds of the Corporation for the payment of such cash.
As promptly as practicable after the surrender in accordance with such
notice of the certificates for any such shares so redeemed (properly
endorsed or assigned for transfer, if the Corporation shall so require and
if the notice shall so state), such shares shall be exchanged for any cash
(without interest thereon) for which such shares have been redeemed. If
fewer than all the outstanding Series D-1 Equity Shares are to be redeemed,
shares to be redeemed shall be selected by the Corporation from outstanding
Series D-1 Equity Shares not previously called for redemption pro rata (as
nearly as may be), by lot or by any other method determined by the
Corporation in its sole discretion to be equitable. If fewer than all the
Series D-1 Equity Shares evidenced by any certificate are redeemed, then
new certificates evidencing the unredeemed shares shall be issued without
cost to the holder thereof.
Section 6. Conversion. The Series D-1 Equity Shares shall not be
convertible into Common Equity Shares prior to (i) a vote of the
shareholders of the Corporation approving the conversion of Series D-1
Equity Shares into Common Equity Shares or (ii) the transfer of the Series
D-1 Equity Shares to an individual to whom the Corporation is permitted to
issue Common Equity Shares without shareholder approval, in accordance with
the rules of the NYSE. Subject to the foregoing, holders of Series D-1
Equity Shares shall have the right to convert all or a portion of such
shares into Common Equity Shares, as follows:
(a) Subject to and upon compliance with the provisions of this
Section 6, a holder of Series D-1 Preferred Shares or Excess Series D-1
Preferred Shares shall have the right, at his or her option, at any time
(such time being, the "Conversion Date"), to convert all or any portion of
such shares into the number of fully paid and non-assessable Common Shares
or Excess Common Shares, respectively, obtained by dividing the aggregate
Liquidation Preference of such shares (inclusive of accrued but unpaid
dividends) by the Conversion Price (as in effect at the time and on the
date provided for in the last paragraph of paragraph (b) of this Section 6)
by surrendering such shares to be converted, such surrender to be made in
the manner provided in paragraph (b) of this Section 6; provided, however,
that the right to convert shares called for redemption pursuant to Section
5 shall terminate at the close of business on the fifth Business Day prior
to the Call Date fixed for such redemption, unless the Corporation shall
default in making payment of the cash payable upon such redemption under
Section 5.
(b) In order to exercise the conversion right, the holder of each
share of Series D-1 Equity Shares to be converted shall surrender the
certificate representing such share, duly endorsed or assigned to the
Corporation or in blank, at the office of the Transfer Agent, accompanied
by written notice to the Corporation that the holder thereof irrevocably
elects to convert such Series D-1 Equity Shares. Unless the shares
issuable on conversion are to be issued in the same name as the name in
which such Series D-1 Equity Shares are registered, each share surrendered
for conversion shall be accompanied by instruments of transfer, in form
satisfactory to the Corporation, duly executed by the holder or such
holder's duly authorized attorney and an amount sufficient to pay any
transfer or similar tax (or evidence reasonably satisfactory to the
Corporation demonstrating that such taxes have been paid).
Holders of Series D-1 Equity Shares at the close of business on a
dividend payment record date shall be entitled to receive the dividend
payable on such shares on the corresponding Dividend Payment Date
notwithstanding the conversion thereof following such dividend payment
record date and prior to such Dividend Payment Date. However, Series D-1
Equity Shares surrendered for conversion during the period between the
close of business on any dividend payment record date and the opening of
business on the corresponding Dividend Payment Date (except shares
converted after the issuance of notice of redemption with respect to a Call
Date during such period, such Series D-1 Equity Shares being entitled to
such dividend on the Dividend Payment Date) must be accompanied by payment
of an amount equal to the dividend payable on such shares on such Dividend
Payment Date. A holder of Series D-1 Equity Shares on a dividend payment
record date who (or whose transferee) tenders any such shares for
conversion into Common Equity Shares on the corresponding Dividend Payment
Date will receive the dividend payable by the Corporation on such Series D-
1 Equity Shares on such date, and the converting holder need not include
payment of the amount of such dividend upon surrender of Series D-1 Equity
Shares for conversion. Except as provided above, the Corporation shall
make no payment or allowance for unpaid dividends, whether or not in
arrears, on converted shares or for dividends on the Common Equity Shares
issued upon such conversion.
As promptly as practicable after the surrender of certificates for
Series D-1 Equity Shares as aforesaid, the Corporation shall issue and
shall deliver at such office to such holder, or on his or her written
order, a certificate or certificates for the number of full Common Equity
Shares issuable upon the conversion of such shares in accordance with
provisions of this Section 6, and any fractional interest in respect of a
Common Equity Share arising upon such conversion shall be settled as
provided in paragraph (c) of this Section 6.
Each conversion shall be deemed to have been effected immediately
prior to the close of business on the date on which the certificates for
Series D-1 Equity Shares shall have been surrendered and such notice shall
have been received by the Corporation as aforesaid (and if applicable,
payment of an amount equal to the dividend payable on such shares shall
have been received by the Corporation as described above), and the Person
or Persons in whose name or names any certificate or certificates for
Common Equity Shares shall be issuable upon such conversion shall be deemed
to have become the holder or holders of record of the shares represented
thereby at such time on such date and such conversion shall be at the
Conversion Price in effect at such time on such date unless the share
transfer books of the Corporation shall be closed on that date, in which
event such Person or Persons shall be deemed to have become such holder or
holders of record at the close of business on the next succeeding day on
which such share transfer books are open, but such conversion shall be at
the Conversion Price in effect on the date on which such shares shall have
been surrendered and such notice received by the Corporation.
(c) No fractional shares or scrip representing fractions of Common
Equity Shares shall be issued upon conversion of the Series D-1 Equity
Shares. Instead of any fractional interest in a Common Equity Share that
would otherwise be deliverable upon the conversion of a Series D-1 Equity
Share, the Corporation shall pay to the holder of such share an amount in
cash based upon the Current Market Price of the Common Shares on the
Trading Day immediately preceding the date of conversion. If more than one
share shall be surrendered for conversion at one time by the same holder,
the number of full Common Equity Shares issuable upon conversion thereof
shall be computed on the basis of the aggregate number of Series D-1 Equity
Shares so surrendered.
(d) The Conversion Price shall be adjusted from time to time as
follows:
(i) If the Corporation shall after the Issue Date (A) pay a
dividend or make a distribution on its Common Equity Shares in Common
Equity Shares, (B) subdivide its outstanding Common Equity Shares into
a greater number of shares, (C) combine its outstanding Common Equity
Shares into a smaller number of shares or (D) issue any shares of
stock by reclassification of its Common Equity Shares, the Conversion
Price in effect at the opening of business on the day following the
date fixed for the determination of shareholders entitled to receive
such dividend or distribution or at the opening of business on the
Business Day next following the day on which such subdivision,
combination or reclassification becomes effective, as the case may be,
shall be adjusted so that the holder of any Series D-1 Equity Shares
thereafter surrendered for conversion shall be entitled to receive the
number of Common Equity Shares that such holder would have owned or
have been entitled to receive after the happening of any of the events
described above as if such Series D-1 Equity Shares had been converted
immediately prior to the record date in the case of a dividend or
distribution or the effective date in the case of a subdivision,
combination or reclassification. An adjustment made pursuant to this
subparagraph (i) shall become effective immediately after the opening
of business on the Business Day next following the record date (except
as provided in paragraph (h) below) in the case of a dividend or
distribution and shall become effective immediately after the opening
of business on the Business Day next following the effective date in
the case of a subdivision, combination or reclassification.
(ii) If the Corporation shall issue after the Issue Date rights,
options or warrants to all holders of Common Equity Shares entitling
them (for a period expiring within 45 days after the record date
mentioned below) to subscribe for or purchase Common Equity Shares at
a price per share less than 95% (100% if a stand-by underwriter is
used and charges the Corporation a commission) of the Fair Market
Value per Common Share on the record date for the determination of
shareholders entitled to receive such rights, options or warrants,
then the Conversion Price in effect at the opening of business on the
Business Day next following such record date shall be adjusted to
equal the price determined by multiplying (A) the Conversion Price in
effect immediately prior to the opening of business on the Business
Day next following the date fixed for such determination by (B) a
fraction, the numerator of which shall be the sum of (x) the number of
Common Equity Shares outstanding on the close of business on the date
fixed for such determination and (y) the number of shares that the
aggregate proceeds to the Corporation from the exercise of such
rights, options or warrants for Common Equity Shares would purchase at
95% of such Fair Market Value (or 100% in the case of a stand-by
underwriting), and the denominator of which shall be the sum of (x)
the number of Common Equity Shares outstanding on the close of
business on the date fixed for such determination and (y) the number
of additional Common Equity Shares offered for subscription or
purchase pursuant to such rights, options or warrants. Such
adjustment shall become effective immediately after the opening of
business on the day next following such record date (except as
provided in paragraph (h) below). In determining whether any rights,
options or warrants entitle the holders of Common Equity Shares to
subscribe for or purchase Common Equity Shares at less than 95% of
such Fair Market Value (or 100% in the case of a stand-by
underwriting), there shall be taken into account any consideration
received by the Corporation upon issuance and upon exercise of such
rights, options or warrants, the value of such consideration, if other
than cash, to be determined by the Board of Directors whose
determination shall be conclusive. To the extent that Common Equity
Shares are not delivered pursuant to such rights, options or warrants,
upon the expiration or termination of such rights, options or
warrants, the Conversion Price shall be readjusted to the Conversion
Price which would then be in effect had the adjustments made upon the
issuance of such rights, options or warrants be made on the basis of
delivery of only the number of Common Equity Shares actually
delivered. In the event that such rights, options or warrants are not
so issued, the Conversion Price shall again be adjusted to be the
Conversion Price which would then be in effect if such date fixed for
the determination of stockholders entitled to receive such rights,
options or warrants had not been fixed.
(iii) If the Corporation shall distribute to all holders of its
Common Equity Shares any securities of the Corporation (other than
Common Equity Shares) or evidence of its indebtedness or assets
(excluding cumulative cash dividends or distributions paid with
respect to the Common Equity Shares after December 31, 1997) which are
not in excess of the following: the sum of (A) the Corporation's
cumulative undistributed Funds from Operations at December 31, 1997,
plus (B) the cumulative amount of Funds from Operations, as determined
by the Board of Directors, after December 31, 1997, minus (C) the
cumulative amount of dividends accrued or paid in respect of the
Series D-1 Equity Shares or any other class or series of preferred
stock of the Corporation after the Issue Date) or rights, options or
warrants to subscribe for or purchase any of its securities (excluding
those rights, options and warrants issued to all holders of Common
Equity Shares entitling them for a period expiring within 45 days
after the record date referred to in subparagraph (ii) above to
subscribe for or purchase Common Equity Shares, which rights and
warrants are referred to in and treated under subparagraph (ii) above)
(any of the foregoing being hereinafter in this subparagraph (iii)
collectively called the "Securities" and individually a "Security"),
then in each such case the Conversion Price shall be adjusted so that
it shall equal the price determined by multiplying (x) the Conversion
Price in effect immediately prior to the close of business on the date
fixed for the determination of shareholders entitled to receive such
distribution by (y) a fraction, the numerator of which shall be the
Fair Market Value per Common Share on the record date mentioned below
less the then fair market value (as determined by the Board of
Directors, whose determination shall be conclusive) of the portion of
the Securities or assets or evidences of indebtedness so distributed
or of such rights, options or warrants applicable to one Common Equity
Share, and the denominator of which shall be the Fair Market Value per
Common Share on the record date mentioned below. Such adjustment
shall become effective on the date of distribution retroactive to the
opening of business on the Business Day next following (except as
provided in paragraph (h) below) the record date for the determination
of shareholders entitled to receive such distribution. For the
purposes of this subparagraph (iii), the distribution of a Security,
which is distributed not only to the holders of the Common Equity
Shares on the date fixed for the determination of shareholders
entitled to such distribution of such Security, but also is
distributed with each Common Equity Share delivered to a Person
converting a share of Series D-1 Equity Shares after such
determination date, shall not require an adjustment of the Conversion
Price pursuant to this subparagraph (iii); provided that on the date,
if any, on which a Person converting a Series D-1 Equity Share would
no longer be entitled to receive such Security with a Common Equity
Share (other than as a result of the termination of all such
Securities), a distribution of such Securities shall be deemed to have
occurred and the Conversion Price shall be adjusted as provided in
this subparagraph (iii) (and such day shall be deemed to be "the date
fixed for the determination of the shareholders entitled to receive
such distribution" and "the record date" within the meaning of the two
preceding sentences). If any dividend or distribution of the type
described in this paragraph (iii) is declared but not so paid or made,
the Conversion Price shall again be adjusted to the Conversion Price
which would then be in effect if such dividend or distribution had not
been declared.
Rights or warrants distributed by the Corporation to all holders
of Common Equity Shares entitling the holders thereof to subscribe for
or purchase shares of the Corporation's capital stock (either
initially or under certain circumstances), which rights or warrants,
until the occurrence of a specified event or events ("Trigger Event"):
(i) are deemed to be transferred with such shares of Common Equity
Shares; (ii) are not exercisable; and (iii) are also issued in respect
of future issuances of Common Equity Shares, shall be deemed not to
have been distributed for purposes of this subparagraph (iii) (and no
adjustment to the Conversion Price under this subparagraph (iii) will
be required) until the occurrence of the earliest Trigger Event. If
such right or warrant is subject to subsequent events, upon the
occurrence of which such right or warrant shall become exercisable to
purchase different securities, evidences of indebtedness or other
assets or entitle the holder to purchase a different number or amount
of the foregoing or to purchase any of the foregoing at a different
purchase price, then the occurrence of each such event shall be deemed
to be the date of issuance and record date with respect to a new right
or warrant (and a termination or expiration of the existing right or
warrant without exercise by the holder thereof to the extent not
exercised). In addition, in the event of any distribution (or deemed
distribution) of rights or warrants, or any Trigger Event or other
event (of the type described in the preceding sentence) with respect
thereto, that resulted in an adjustment to the Conversion Price under
this subparagraph (iii), (1) in the case of any such rights or
warrants which shall all have been redeemed or repurchased without
exercise by any holders thereof, the Conversion Price shall be
readjusted upon such final redemption or repurchase to give effect to
such distribution or Trigger Event, as the case may be, as though it
were a cash distribution (but not a distribution paid exclusively in
cash), equal to the per share redemption or repurchase price received
by a holder of Common Equity Shares with respect to such rights or
warrants (assuming such holder had retained such rights or warrants),
made to all holders of Common Equity Shares as of the date of such
redemption or repurchase, and (2) in the case of such rights or
warrants all of which shall have expired or been terminated without
exercise, the Conversion Price shall be readjusted as if such rights
and warrants had never been issued.
(iv) In case a tender or exchange offer (which term shall not
include open market repurchases by the Corporation) made by the
Corporation or any subsidiary or controlled Affiliate of the
Corporation for all or any portion of the Common Equity Shares shall
expire and such tender or exchange offer shall require the payment by
the Corporation or such subsidiary or controlled Affiliate of
consideration per Common Equity Share having a fair market value (as
determined in good faith by the Board of Directors, whose
determination shall be conclusive and described in a resolution of the
Board of Directors), at the last time (the "Expiration Time") tenders
or exchanges may be made pursuant to such tender or exchange offer,
that exceeds the Current Market Price per Common Share on the Trading
Day next succeeding the Expiration Time, the Conversion Price shall be
reduced so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the
effectiveness of the Conversion Price reduction contemplated by this
subparagraph, by a fraction of which the numerator shall be the number
of Common Equity Shares outstanding (including any tendered or
exchanged shares) at the Expiration Time, multiplied by the Current
Market Price per Common Share on the Trading Day next succeeding the
Expiration Time, and the denominator shall be the sum of (A) the fair
market value (determined as aforesaid) of the aggregate consideration
payable to shareholders based upon the acceptance (up to any maximum
specified in the terms of the tender or exchange offer) of all shares
validly tendered or exchanged and not withdrawn as of the Expiration
Time (the shares deemed so accepted, up to any maximum, being referred
to as the "Purchased Shares") and (B) the product of the number of
Common Equity Shares outstanding (less any Purchased Shares) at the
Expiration Time and the Current Market Price per Common Share on the
Trading Day next succeeding the Expiration Time, such reduction to
become effective immediately prior to the opening of business on the
day following the Expiration Time. In the event the Corporation or
any subsidiary or controlled Affiliate is obligated to purchase shares
pursuant to any such tender offer, but the Corporation or such
subsidiary or controlled Affiliate is permanently prevented by
applicable law from effecting any such purchases, or all such
purchases are rescinded, the Conversion Price shall again be adjusted
to be the Conversion Price which would then be in effect if such
tender offer had not been made.
(v) No adjustment in the Conversion Price shall be required
unless such adjustment would require a cumulative increase or decrease
of at least 1% in such price; provided, however, that any adjustments
that by reason of this subparagraph (v) are not required to be made
shall be carried forward and taken into account in any subsequent
adjustment until made; and provided, further, that any adjustment
shall be required and made in accordance with the provisions of this
Section 6 (other than this subparagraph (v)) not later than such time
as may be required in order to preserve the tax-free nature of a
distribution to the holders of Common Shares. Notwithstanding any
other provisions of this Section 6, the Corporation shall not be
required to make any adjustment of the Conversion Price for the
issuance of any Common Equity Shares pursuant to any plan providing
for the reinvestment of dividends or interest payable on securities of
the Corporation and the investment of additional optional amounts in
Common Equity Shares under such plan. All calculations under this
Section 6 shall be made to the nearest cent (with $.005 being rounded
upward) or to the nearest one-hundredth of a share (with .005 of a
share being rounded upward), as the case may be. Anything in this
paragraph (d) to the contrary notwithstanding, the Corporation shall
be entitled, to the extent permitted by law, to make such reductions
in the Conversion Price, in addition to those required by this
paragraph (d), as it in its discretion shall determine to be advisable
in order that any share dividends, subdivision of shares,
reclassification or combination of shares, distribution of rights or
warrants to purchase shares or securities, or distribution of other
assets (other than cash dividends) hereafter made by the Corporation
to its shareholders shall not be taxable. To the extent permitted by
applicable law, the Corporation from time to time may reduce the
Conversion Price by any amount for any period of time if the period is
at least 20 days, the reduction is irrevocable during the period and
the Board of Directors shall have made a determination that such
reduction would be in the best interests of the Corporation, which
determination shall be conclusive. Whenever the Conversion Price is
reduced pursuant to the preceding sentence, the Corporation shall mail
to the holder of each Series D-1 Equity Share at his or her last
address appearing on the share register a notice of reduction prior to
the date the reduced Conversion Price takes effect and such notice
shall state the reduced Conversion Price and the period during which
it will be in effect.
(e) If the Corporation shall be a party to any transaction (including
without limitation a merger, consolidation, statutory share exchange, self
tender offer for 40% or more of its Common Equity Shares, sale of all or
substantially all of the Corporation's assets or recapitalization of the
Common Equity Shares and excluding any transaction as to which subparagraph
(d)(i) of this Section 6 applies) (each of the foregoing being referred to
herein as a "Transaction"), in each case as a result of which all or
substantially all of the Common Equity Shares are converted into the right
to receive different securities or other property (including cash or any
combination thereof), each Series D-1 Equity Share which is not redeemed or
converted into the right to receive different securities or other property
prior to such Transaction shall thereafter be convertible, in lieu of
Common Equity Shares into the kind and amount of different securities and
other property (including cash or any combination thereof) receivable upon
the consummation of such Transaction by a holder of that number of Common
Equity Shares into which one Series D-1 Equity Share was convertible
immediately prior to such Transaction, assuming such holder of Common
Equity Shares (i) is not a Person with which the Corporation consolidated
or into which the Corporation merged or which merged into the Corporation
or to which such sale or transfer was made, as the case may be
("Constituent Person"), or an Affiliate of a Constituent Person and (ii)
failed to exercise his rights of election, if any, as to the kind or amount
of shares, securities and other property (including cash) receivable upon
such Transaction (provided that if the kind or amount of shares, securities
and other property (including cash) receivable upon such Transaction is not
the same for each Common Share held immediately prior to such Transaction
by other than a Constituent Person or an Affiliate thereof and in respect
of which such rights of election shall not have been exercised ("Non-
Electing Share"), then for the purpose of this paragraph (e) the kind and
amount of shares, securities and other property (including cash) receivable
upon such Transaction by each Non-Electing Share shall be deemed to be the
kind and amount so receivable per share by holders of a plurality of the
Non-Electing Shares). The Corporation shall not be a party to any
Transaction unless the terms of such Transaction are consistent with the
provisions of this paragraph (e), and it shall not consent or agree to the
occurrence of any Transaction until the Corporation has entered into an
agreement with the successor or purchasing entity, as the case may be, for
the benefit of the holders of the Series D-1 Equity Shares that will
contain provisions enabling the holders of the Series D-1 Equity Shares
that remain outstanding after such Transaction to convert into the
consideration received by holders of Common Equity Shares at the Conversion
Price in effect immediately prior to such Transaction. The provisions of
this paragraph (e) shall similarly apply to successive Transactions.
(f) If:
(i) the Corporation shall declare a dividend (or any other
distribution) on its Common Equity Shares (other than cash dividends
or distributions paid with respect to the Common Equity Shares after
December 31, 1997 not in excess of the sum of the Corporation's
cumulative undistributed Funds from Operations at December 31, 1997,
plus the cumulative amount of Funds from Operations, as determined by
the Board of Directors, after December 31, 1997, minus the cumulative
amount of dividends accrued or paid in respect of the Series D-1
Equity Shares or any other class or series of preferred stock of the
Corporation after the Issue Date); or
(ii) the Corporation shall authorize the granting to all holders
of Common Equity Shares of rights, options or warrants to subscribe
for or purchase any shares of any class or any other rights, options
or warrants; or
(iii) there shall be any reclassification of the Common Equity
Shares (other than an event to which subparagraph (d)(i) of this
Section 6 applies) or any consolidation or merger to which the
Corporation is a party (other than a merger in which the Corporation
is the surviving entity) and for which approval of any shareholders of
the Corporation is required, or a statutory share exchange, or a self
tender offer by the Corporation for all or substantially all of its
outstanding Common Shares or the sale or transfer of all or
substantially all of the assets of the Corporation as an entirety; or
(iv) there shall occur the voluntary or involuntary liquidation,
dissolution or winding up of the Corporation;
then the Corporation shall cause to be filed with the Transfer Agent and
shall cause to be mailed to the holders of Series D-1 Equity Shares at
their addresses as shown on the records of the Corporation, as promptly as
possible, but at least 10 days prior to the applicable date hereinafter
specified, a notice stating (A) the date on which a record is to be taken
for the purpose of such dividend, distribution or granting of rights,
options or warrants, or, if a record is not to be taken, the date as of
which the holders of Common Equity Shares of record to be entitled to such
dividend, distribution or rights, options or warrants are to be determined
or (B) the date on which such reclassification, consolidation, merger,
statutory share exchange, sale, transfer, liquidation, dissolution or
winding up is expected to become effective, and the date as of which it is
expected that holders of Common Equity Shares of record shall be entitled
to exchange their Common Equity Shares for securities or other property, if
any, deliverable upon such reclassification, consolidation, merger,
statutory share exchange, sale, transfer, liquidation, dissolution or
winding up. Failure to give or receive such notice or any defect therein
shall not affect the legality or validity of the proceedings described in
this Section 6.
(g) Whenever the Conversion Price is adjusted as herein provided, the
Corporation shall promptly file with the Transfer Agent an officer's
certificate setting forth the Conversion Price after such adjustment and
setting forth a brief statement of the facts requiring such adjustment
which certificate shall be conclusive evidence of the correctness of such
adjustment absent manifest error. Promptly after delivery of such
certificate, the Corporation shall prepare a notice of such adjustment of
the Conversion Price setting forth the adjusted Conversion Price and the
effective date of such adjustment and shall mail such notice of such
adjustment of the Conversion Price to the holder of each share of Series D-
1 Equity Shares at such holder's last address as shown on the records of
the Corporation.
(h) In any case in which paragraph (d) of this Section 6 provides
that an adjustment shall become effective on the day next following the
record date for an event, the Corporation may defer until the occurrence of
such event (A) issuing to the holder of any share of Series D-1 Equity
Shares converted after such record date and before the occurrence of such
event the additional Common Equity Shares issuable upon such conversion by
reason of the adjustment required by such event over and above the Common
Equity Shares issuable upon such conversion before giving effect to such
adjustment and (B) paying to such holder any amount of cash in lieu of any
fraction pursuant to paragraph (c) of this Section 6.
(i) There shall be no adjustment of the Conversion Price in case of
issuance of any stock of the Corporation in a reorganization, acquisition
or other similar transaction except as specifically set forth in this
Section 6. If any action or transaction would require adjustment of the
Conversion Price pursuant to both paragraph (d) and paragraph (e) of this
Section 6, only one adjustment shall be made and such adjustment shall be
the amount of adjustment that has the highest absolute value.
(j) If the Corporation shall take any action affecting the Common
Equity Shares, other than action described in this Section 6, that in the
opinion of the Board of Directors would materially and adversely affect the
conversion rights of the holders of the Series D-1 Equity Shares, the
Conversion Price for the Series D-1 Equity Shares may be adjusted, to the
extent permitted by law, in such manner, if any, and at such time, as the
Board of Directors, in its sole discretion, may determine to be equitable
in the circumstances.
(k) The Corporation covenants that it will at all times reserve and
keep available, free from preemptive rights, out of the aggregate of its
authorized but unissued Common Equity Shares, for the purpose of effecting
conversion of the Series D-1 Equity Shares, the full number of Common
Equity Shares deliverable upon the conversion of all outstanding Series D-1
Equity Shares not theretofore converted. For purposes of this paragraph
(k), the number of Common Shares that shall be deliverable upon the
conversion of all outstanding Series D-1 Preferred Shares shall be computed
as if at the time of computation all such outstanding shares were held by a
single holder.
Any Common Equity Shares issued upon conversion of the Series D-1
Equity Shares shall be validly issued, fully paid and non-assessable.
Before taking any action that would cause an adjustment reducing the
Conversion Price below the then-par value of the Common Equity Shares
deliverable upon conversion of the Series D-1 Equity Shares, the
Corporation will take any action that, in the opinion of its counsel, may
be necessary in order that the Corporation may validly and legally issue
fully paid and (subject to any customary qualification based upon the
nature of a real estate investment trust) nonassessable Common Equity
Shares at such adjusted Conversion Price.
The Corporation shall use its best efforts to list the Common Shares
required to be delivered upon conversion of the Series D-1 Preferred
Shares, prior to such delivery, upon each national securities exchange, if
any, upon which the outstanding Common Shares are listed at the time of
such delivery.
The Corporation shall use its best efforts to comply with all federal
and state securities laws and regulations thereunder in connection with the
issuance of any securities that the Corporation shall be obligated to
deliver upon conversion of the Series D-1 Equity Shares. The certificates
evidencing such securities shall bear such legends restricting transfer
thereof in the absence of registration under applicable securities laws or
an exemption therefrom as the Corporation may in good faith deem
appropriate.
(l) The Corporation will pay any and all documentary stamp or similar
issue or transfer taxes payable in respect of the issue or delivery of
Common Equity Shares or other securities or property on conversion of the
Series D-1 Equity Shares pursuant hereto; provided, however, that the
Corporation shall not be required to pay any tax that may be payable in
respect of any transfer involved in the issue or delivery of Common Shares
or other securities or property in a name other than that of the holder of
the Series D-1 Equity Shares to be converted, and no such issue or delivery
shall be made unless and until the Person requesting such issue or delivery
has paid to the Corporation the amount of any such tax or established, to
the reasonable satisfaction of the Corporation, that such tax has been
paid.
Section 7. Change of Control. (a) If a Change of Control (as
defined below) occurs (a "Change of Control Repurchase Event"), the holders
of Series D-1 Equity Shares shall have the right to require the
Corporation, to the extent the Corporation shall have funds legally
available therefor, to redeem any or all of the Series D-1 Equity Shares
held by such holder at a repurchase price payable in cash (the "Change of
Control Repurchase Payment") in an amount equal to 105% of the Liquidation
Preference thereof, plus accrued and unpaid dividends whether or not
declared, if any, to the date of repurchase or the date payment is made
available (the "Change of Control Date"), pursuant to the offer described
in subsection (b) below (the "Change of Control Repurchase Offer").
(b) Within 15 days following the Corporation becoming aware that a
Change of Control Repurchase Event has occurred, the Corporation shall mail
by first class mail or recognized overnight courier a notice to the each
holder of Series D-1 Equity Shares stating (A) that a Change of Control
Repurchase Event has occurred and that such holder has the right to require
the Corporation to repurchase any or all of the Series D-1 Equity Shares
then held by such bolder, (B) the date of repurchase (which shall be a
Business Day, no earlier than 30 days and no later than 60 days from the
date such notice is mailed, or such later date as may be necessary to
comply with the requirements of the Exchange Act), (C) the repurchase price
and (D) the instructions determined by the Corporation, consistent with
this subsection, that such investor must follow in order to have the Series
D-1 Equity Shares repurchased.
(c) On the Change of Control Repurchase Date, the Corporation, to the
extent lawful, shall accept for payment Series D-1 Equity Shares or
portions thereof tendered by such holder pursuant to the Change of Control
Repurchase Offer and promptly by wire transfer of immediately available
funds to such holder, as directed by such holder, send an amount equal to
the Change of Control Repurchase Payment in respect of all Series D-1
Equity Shares or portions thereof so tendered.
(d) Notwithstanding anything else herein, to the extent they are
applicable to any Change of Control Repurchase Offer, the Corporation will
comply with any federal and state securities laws, rules and regulations
and all time periods and requirements shall be adjusted accordingly.
(e) For purposes hereof, "Change of Control" means the occurrence of
any of the following: (i) the first acquisition, directly or indirectly,
by any individual or entity or group (as such term is used in Section
13(d)(3) of the Exchange Act) of beneficial ownership (as defined in Rule
13d-3 under the Exchange Act, except that such individual or entity shall
be deemed to have beneficial ownership of all shares that any such
individual or entity has the right to acquire, whether such right is
exercisable immediately or only after passage of time) of more than 25% of
the Corporation's outstanding stock with voting power, under ordinary
circumstances, to elect Directors of the Corporation, (ii) during any
period of two consecutive years, individuals who at the beginning of such
period constituted the Board of Directors of the Corporation (together with
any new Directors whose election by such Board of Directors or whose
nomination for election by the shareholders of the Corporation was approved
by a vote of 66 2/3% of the Directors of the Corporation then still in
office who were either Directors at the beginning of such period, or whose
election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the Board of Directors then in
office of the Corporation; and (iii) (A) the Corporation consolidating with
or merging into another entity or conveying, transferring or leasing all or
substantially all of its assets (including, but not limited to, real
property investments) to any individual or entity, or (B) any entity
consolidating with or merging into the Corporation, which in either event
(A) or (B) is pursuant to a transaction in which the outstanding voting
stock of the Corporation is reclassified or changed into or exchanged for
cash, securities or other property; provided, however, that the events
described in clauses (i)(ii) and (iii) shall not be deemed to be a Change
of Control (a) in the case of an event described in clause (iii), if the
sole purpose of such event is that the Corporation is seeking to change its
domicile or to convert from a corporation to a trust or vice versa; (b) in
the case of an event described in clause (iii), if the holders of the
exchanged securities of the Corporation immediately after such transaction
beneficially own at least a majority of the securities of the merged or
consolidated entity normally entitled to vote in elections of Directors of
the Corporation; (c) if any of WHL or its wholly-owned subsidiaries remain
as manager of the Corporation's properties and remains as adviser of the
Corporation, in each case, in a manner substantially similar to that on
date hereof; or (d) if the Change of Control results solely from the
purchase or other acquisition of equity securities by WHL or its wholly-
owned subsidiaries, Westfield America Trust, the Lowy Family or the
Investor or the sale of equity securities by WHL or any of its wholly-owned
subsidiaries or Westfield America Trust.
Section 8. Redemption at the Option of the Holder. (a) At any time
after August 12, 2008, the holders of Series D-1 Equity Shares thereof
shall have the right at any time that the Corporation's Common Shares has a
Current Market Price at or below and the Conversion Price per share, to
require the Corporation, to the extent the Corporation shall have funds
legally available therefor, to redeem any or all of the Series D-1 Equity
Shares held by such holder at a repurchase price payable, at the option of
the Corporation, in either (i) cash, or (ii) such number of Common Equity
Shares as shall have a Current Market Price in the aggregate on the day
prior to the day such holder gives notice pursuant to Section 8(b) of its
intention to redeem, equal to in either case, 100% of the Liquidation
Preference thereof plus accrued and unpaid dividends whether or not
declared, if any, to the date of repurchase or the date payment is made
available (in the aggregate, the "Redemption Payment").
(b) Notwithstanding paragraph (a) of this Section 8, in the event
that WHL and its subsidiaries and the trustee of Westfield America Trust on
behalf of Westfield America Trust vote to approve the conversion of the
Series D-1 Equity Shares into Common Equity Shares at a meeting of
shareholders at which such proposal is raised, but the shareholders of the
Corporation as a whole reject the foregoing proposal, then from and after
the later of such rejection date and the second anniversary of the Issue
Date, the Series D-1 Equity Stock shall be redeemable at the option of the
holder, to the extent that the Corporation shall have funds legally
available therefor, at a redemption price payable in cash equal to the
product of (a) the Series D-1 Common Equivalent Factor times (b) the
Current Market Price on the date of the notice provided pursuant to
paragraph (c) below, plus all accumulated, accrued and unpaid dividends
whether or not declared, if any, to the date of repurchase or the date
payment is made available.
(c) For purposes of this Section 8, redemption at the option of the
holder shall be deemed to occur upon receipt by the Corporation of written
notice that the holder of Series D-1 Equity Shares wishes to tender shares
to be redeemed. The holders of such shares to be redeemed shall then have
30 days from the date of such notice to deliver such shares to the Transfer
Agent. Upon the surrender of the certificate or certificates of Series D-1
Equity Shares to be redeemed, duly endorsed or assigned to the Corporation
or in blank, at the office of the Transfer Agent, the Corporation shall
promptly, either (i) by wire transfer of immediately available funds to
such holder, as directed by such holder, send an amount equal to the
Redemption Payment in respect of all Series D-1 Equity Shares or portions
thereof so tendered or (ii) issue and deliver to such holder, or on his or
her written order, a certificate or certificates for the number of full
Common Equity Shares issuable in respect of all Series D-1 Equity Shares or
portions thereof so tendered.
Section 9. Shares To Be Retired. All Series D-1 Equity Shares which
shall have been issued and reacquired in any manner by the Corporation
shall be restored to the status of authorized but unissued preferred stock,
without discretion as to class or series, and subject to applicable
limitations set forth in the Articles may thereafter be reissued as shares
of any series of preferred stock.
Section 10. Ranking. Any class or series of stock of the Corporation
shall be deemed to rank:
(a) prior to the Series D-1 Preferred Shares, as to the payment of
dividends and as to distribution of assets upon liquidation, dissolution
or winding up, if the holders of such class or series shall be entitled
to the receipt of dividends or of amounts distributable upon
liquidation, dissolution or winding up, as the case may be, in
preference or priority to the holders of Series D-1 Preferred Shares,
which shall expressly include the Corporation's non-voting senior
preferred stock, par value $1.00 per share;
(b) on a parity with the Series D-1 Preferred Shares, as to the
payment of dividends and as to distribution of assets upon liquidation,
dissolution or winding up, whether or not the dividend rates, dividend
payment dates or redemption or liquidation prices per share thereof
shall be different from those of the Series D-1 Preferred Shares, if the
holders of such class or series and the Series D-1 Preferred Shares
shall be entitled to the receipt of dividends and of amounts
distributable upon liquidation, dissolution or winding up in proportion
to their respective amounts of accrued and unpaid dividends per share or
liquidation preferences, without preference or priority one over the
other ("Parity Shares"), which shall expressly include the Corporation's
Series A Cumulative Redeemable Preferred Shares, Series B Cumulative
Redeemable Preferred Shares, Series C Cumulative Convertible Preferred
Stock, Series C-1 Cumulative Convertible Preferred Stock, Series C-2
Cumulative Convertible Preferred Stock, if any shall have been
authorized and issued, and Series D Cumulative Convertible Preferred
Stock;
(c) junior to the Series D-1 Preferred Shares, as to the payment of
dividends or as to the distribution of assets upon liquidation,
dissolution or winding up, if such class or series shall be Junior
Shares; and
(d) junior to the Series D-1 Preferred Shares, as to the payment of
dividends and as to the distribution of assets upon liquidation,
dissolution or winding up, if such class or series shall be Fully Junior
Shares.
Section 11. Series D Preferred Shares. The Company shall be entitled
to treat the Series D Preferred Shares and the Series D-1 Preferred Shares
as one class for accounting purposes.
Section 12. Voting. So long as any Series D-1 Equity Shares are
outstanding, in addition to any other vote or consent of shareholders
required by law or by the Articles, the affirmative vote of the holders of
a majority of the Series D Equity Shares and the Series D-1 Equity Shares,
voting together as a class, given in person or by proxy, either in writing
without a meeting or by vote at any meeting called for the purpose, shall
be necessary for effecting or validating:
(i) Any amendment, alteration or repeal of any of the provisions
of the Articles of Incorporation or this Certificate of Designation
that materially and adversely affects the voting powers, rights or
preferences of the holders of the Series D Equity Shares or the Series
D-1 Equity Shares; or
(ii) Any merger or consolidation of the Corporation and another
entity in which the Corporation is not the surviving corporation and
each holder of Series D Equity Shares and Series D-1 Equity Shares
does not receive shares of the surviving corporation with
substantially similar rights, preferences and powers in the surviving
corporation as the Series D Equity Shares and Series D-1 Equity Shares
have with respect to the Corporation (except for changes that do not
materially and adversely affect the holders of the Series D Equity
Shares or Series D-1 Equity Shares).
provided, however, that no such vote of the holders of the Series D
Equity Shares and Series D-1 Equity Shares shall be required if, at or
prior to the time when such amendment, alteration or repeal is to take
effect, or when the issuance of any such prior shares or convertible
security is to be made, as the case may be, provision is made for the
redemption of all Series D Equity Shares and Series D-1 Equity Shares
at the time outstanding to the extent such redemption is authorized by
Section 5 of this Certificate of Designation.
(iii) For purposes of the foregoing provisions of this Section
13, each share of Series D-1 Equity Shares shall have one (1) vote per
share, except that when any other series of Equity Shares shall have
the right to vote with the Series D-1 Equity Shares as a single class
on any matter, then the Series D-1 Equity Shares and such other series
shall have with respect to such matters one (1) vote per $180.00 (or
less pursuant to Section 4(a)) of stated Liquidation Preference.
Except as otherwise required by applicable law or as set forth herein,
the Series D-1 Equity Shares shall not have any relative,
participating, optional or other special voting rights and powers
other than as set forth herein, and the consent of the holders thereof
shall not be required for the taking of any corporate action.
Section 13. Record Holders. The Corporation and the Transfer Agent
may deem and treat the record holder of any Series D-1 Preferred Shares as
the true and lawful owner thereof for all purposes, and neither the
Corporation nor the Transfer Agent shall be affected by any notice to the
contrary.
Section 14. Title. This resolution shall be known and may be
referred to as "A Resolution of the Board of Directors of Westfield
America, Inc. Designating Series D-1 Preferred Shares and Fixing
Preferences and Rights Thereof."
FURTHER RESOLVED, that the appropriate officers of the Corporation are
hereby authorized and directed to execute and acknowledge a certificate
setting forth these resolutions and to cause such certificate to be filed
and recorded, all in accordance with the requirements of Section 351.046 of
the General and Business Corporation Law of the State of Missouri, as
amended.
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation to be duly executed by its Co-President this 15th day of
December, 1998.
WESTFIELD AMERICA, INC.
By: /s/ Peter S. Lowy
--------------------------
Name: Peter S. Lowy
Title: Co-President
CORPORATE ACKNOWLEDGMENT
STATE OF CALIFORNIA )
) SS:
COUNTY OF LOS ANGELES )
I, Leesa A. Ashley, a notary public, do hereby certify that on this
15th day of December, 1998, personally appeared before me Peter S. Lowy,
and being first duly sworn by me, declared that he is the Co-President of
Westfield America, Inc., that he signed the foregoing document as Co-
President of the corporation, and that the statements therein contained
are true.
[SEAL]
/s/ Leesa A. Ashley
-----------------------------
Notary Public
My Commission Expires: April 30, 2001
