<PAGE> 1
As filed with the Securities and Exchange Commission on February 12, 1999
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES PURSUANT TO
SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
(Exact name of Registrant as Specified in its Charter)
MARYLAND 84-1259577
---------------------------- ------------------------------------
(State of Incorporation or (I.R.S. Employer Identification No.)
Organization)
1873 SOUTH BELLAIRE STREET, 17TH FLOOR
DENVER, COLORADO 80222-4348
--------------------------------------------
(Address of principal executive offices)
If this Form relates to the registration of a class of debt securities and is
effective upon filing pursuant to General Instruction A(c)(1) please check the
following box. [ ]
If this Form relates to the registration of a class of debt securities and is to
become effective simultaneously with the effectiveness of a concurrent
registration statement under the Securities Act of 1933 pursuant to General
Instruction A(c)(2) please check the following box. [ ]
Securities to be registered pursuant to Section 12(b) of the Act:
<TABLE>
<CAPTION>
Title of Each Class Name of Each Exchange on Which
to be so Registered Each Class is to be Registered
- ------------------- ------------------------------
<S> <C>
Class K Convertible Cumulative The New York Stock Exchange
Preferred Stock, par value $.01 per share
(liquidation preference $25 per share)
</TABLE>
Securities to be registered pursuant to Section 12(g) of the Act: None
================================================================================
<PAGE> 2
ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED.
This Registration Statement relates to the registration under
the Securities Exchange Act of 1934, as amended, of shares of Class K
Convertible Cumulative Preferred Stock, par value $.01 per share (liquidation
preference $25 per share) (the "Class K Preferred Stock"), of Apartment
Investment and Management Company, a Maryland corporation (the "Registrant").
Each share of Class K Preferred Stock is convertible into 0.59524 shares of
Class A Common Stock, par value $.01 per share, of the Registrant. The
description of the Class K Preferred Stock to be registered hereunder is set
forth under the caption "Description of Class K Convertible Cumulative Preferred
Stock" in the Registrant's Prospectus Supplement, dated February 11, 1999, with
respect to the Class K Preferred Stock (the "Prospectus Supplement"), filed
pursuant to Rule 424(b) promulgated under the Securities Act of 1933, as
amended, relating to the Registrant's Registration Statement on Form S-3 (No.
333-61409) filed with the Commission on November 25, 1998, as amended, which
description is incorporated herein by reference.
ITEM 2. EXHIBITS.
The Registrant intends to register the Class K Preferred
Stock on The New York Stock Exchange, on which other securities of the
Registrant are registered. Accordingly, copies of the following exhibits will
be filed with The New York Stock Exchange, and are filed as exhibits to this
Registration Statement:
3.1 Charter of Registrant (incorporated by reference to Exhibit
3.1 to the Registrant's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 1998);
3.2 Bylaws of Registrant (incorporated by reference to Exhibit 3.2
to the Registrant's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 1997);
3.3 Form of Articles Supplementary relating to the Class K
Preferred Stock; and
3.4 Form of Stock Certificate relating to the Class K Preferred
Stock.
2
<PAGE> 3
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, as amended, the registrant has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereto
duly authorized.
APARTMENT INVESTMENT AND
MANAGEMENT COMPANY
By: /s/ Troy D. Butts
--------------------------------------
Name: Troy D. Butts
Title: Vice President and
Chief Financial Officer
Date: February 12, 1999
4
<PAGE> 4
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<S> <C>
3.1 Charter of Registrant (incorporated by reference to Exhibit
3.1 to the Registrant's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 1998).
3.2 Bylaws of Registrant (incorporated by reference to Exhibit 3.2
to the Registrant's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 1997).
3.3 Form of Articles Supplementary relating to the Class K
Preferred Stock.
3.4 Form of Stock Certificate relating to the Class K Preferred
Stock.
</TABLE>
<PAGE> 1
EXHIBIT 3.3
FORM OF
ARTICLES SUPPLEMENTARY
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
CLASS K CONVERTIBLE CUMULATIVE PREFERRED STOCK
(PAR VALUE $.01 PER SHARE)
APARTMENT INVESTMENT AND MANAGEMENT COMPANY, a
Maryland corporation (hereinafter called the "Corporation"), having its
principal office in Baltimore City, Maryland, hereby certifies to the Department
of Assessments and Taxation of the State of Maryland that:
FIRST: Pursuant to authority expressly vested in the Board of Directors
of the Corporation by Section 1.2 of Article IV of the Charter of the
Corporation, as amended to date (the "Charter"), the Board of Directors has duly
divided and classified 5,750,000 authorized but unissued shares of Class A
Common Stock of the Corporation, par value $.01 per share (the "Class A Common
Stock"), into a class designated as Class K Convertible Cumulative Preferred
Stock, par value $.01 per share, and has provided for the issuance of such
class.
SECOND: The reclassification increases the number of shares classified
as Class K Cumulative Preferred Stock, par value $.01 per share, from no shares
immediately prior to the reclassification to 5,750,000 shares immediately after
the reclassification. The reclassification decreases the number of shares
classified as Class A Common Stock from 484,027,500 shares immediately prior to
the reclassification to 478,277,500 shares immediately after the
reclassification.
THIRD: The terms of the Class K Convertible Cumulative Preferred Stock
(including the preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends and other distributions,
qualifications, or terms or conditions of redemption) as set by the Board of
Directors are as follows:
1. NUMBER OF SHARES AND DESIGNATION.
This class of Preferred Stock shall be designated as Class K
Convertible Cumulative Preferred Stock, par value $.01 per share (the "Class K
Preferred Stock"), and Five Million Seven Hundred Fifty Thousand (5,750,000)
shall be the authorized number of shares of such Class K Preferred Stock
constituting such class.
<PAGE> 2
2. DEFINITIONS.
For purposes of the Class K Preferred Stock, the following terms shall
have the meanings indicated:
"Act" shall mean the Securities Act of 1933, as amended.
"affiliate" of a Person means 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.
"Aggregate Value" shall mean, with respect to any block of Equity
Stock, the sum of the products of (i) the number of shares of each
class of Equity Stock within such block multiplied by (ii) the
corresponding Market Price of one share of Equity Stock of such class.
"Beneficial Ownership" shall mean, with respect to any Person,
ownership of shares of Equity Stock equal to the sum of (i) the number
of shares of Equity Stock directly owned by such Person, (ii) the
number of shares of Equity Stock indirectly owned by such Person (if
such Person is an "individual" as defined in Section 542(a)(2) of the
Code) taking into account the constructive ownership rules of Section
544 of the Code, as modified by Section 8 56(h)(1)(B) of the Code, and
(iii) the number of shares of Equity Stock that such Person is deemed
to beneficially own pursuant to Rule 13d-3 under the Exchange Act or
that is attributed to such Person pursuant to Section 318 of the Code,
as modified by Section 856(d)(5) of the Code, provided that when
applying this definition of Beneficial Ownership to the Initial Holder,
clause (iii) of this definition, and clause (a) (ii) of the definition
of "Person" shall be disregarded. The terms "Beneficial Owner,"
"Beneficially Owns" and "Beneficially Owned" shall have the correlative
meanings.
"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 Class K
Preferred Stock; provided that, for purposes of paragraph (a) of
Section 9 of this Article, the term "Board of Directors" shall not
include any such committee.
"Business Day" shall mean any day other than a Saturday, Sunday or a
day on which state or federally chartered banking institutions in New
York, New York are not required to be open.
"Cash Redemption Price" shall mean, with respect to any shares of Class
K Preferred Stock to be redeemed, (i) if the Redemption Date occurs
during the period from and including February 18, 2002, to but
excluding February 18, 2003, 102% of the Liquidation Preference
thereof, and (ii) if the Redemption
2
<PAGE> 3
Date occurs on or after February 18, 2003, 100% of the Liquidation
Preference thereof, plus, in the case of clause (i) or (ii), all
accumulated, accrued and unpaid dividends (whether or not earned or
declared), if any, to the Redemption Date.
"Charitable Beneficiary" shall mean one or more beneficiaries of the
Trust as determined pursuant to Section 11.3 of this Article, each of
which shall be an organization described in Section 170(b)(1)(A),
170(c)(2) and 501(c)(3) of the Code.
"Class K Preferred Stock" shall have the meaning set forth in Section 1
of this Article.
"Closing Price" shall mean, when used with respect to a share of any
Equity Stock and for any date, the last sale price, regular way, or, in
case no such sale takes place on such day, the average of the closing
bid and asked prices, regular way, in either case, as reported in the
principal consolidated transaction reporting system with respect to
securities listed or admitted to trading on the NYSE or, if the Equity
Stock is not listed or admitted to trading on the NYSE, as reported in
the principal consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange on
which the Equity Stock is listed or admitted to trading or, if the
Equity Stock is not listed or admitted to trading on any national
securities exchange, the last quoted price, or if not so quoted, the
average of the high bid and low asked prices in the over-the-counter
market, as reported by the National Association of Securities Dealers,
Inc. Automated Quotation System or, if such system is no longer in use,
the principal other automated quotation system that may then be in use
or, if the Equity Stock is not quoted by any such organization, the
average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Equity Stock selected
by the Board of Directors of the Corporation.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, or any successor statute thereto. Reference to any
provision of the Code shall mean such provision as in effect from time
to time, as the same may be amended, and any successor thereto, as
interpreted by any applicable regulations or other administrative
pronouncements as in effect from time to time.
"Common Stock" shall mean the Class A Common Stock, $.01 par value per
share, of the Corporation, and the Class B Common Stock, $.01 par value
per share, of the Corporation and such other shares of the
Corporation's capital stock into which outstanding shares of such Class
A Common Stock or Class B Common Stock shall be reclassified.
3
<PAGE> 4
"Conversion Price" shall mean the conversion price per share of Class A
Common Stock for which each share of Class K Preferred Stock is
convertible, as such Conversion Price may be adjusted pursuant to
Section 7 of this Article. The initial Conversion Price shall be $42.00
(equivalent to a conversion rate of 0.59524 shares of Class A Common
Stock for each share of Class K Preferred Stock).
"Dividend Payment Date" shall mean January 15, April 15, July 15 and
October 15 of each year; provided, that if any Dividend Payment Date
falls on any day other than a Business Day, the dividend payment
payable on such Dividend Payment Date shall be paid on the Business Day
immediately following such Dividend Payment Date and no interest shall
accrue on such dividend from such date to such Dividend Payment Date.
"Dividend Periods" shall mean the Initial Dividend Period and each
subsequent quarterly dividend period commencing on and including
January 15, April 15, July 15 and October 15 of each year and ending on
and including the day preceding the first day of the next succeeding
Dividend Period, other than the Dividend Period during which any Class
K Preferred Stock shall be redeemed pursuant to Section 5 hereof, which
shall end on and include the Redemption Date with respect to the Class
K Preferred Stock being redeemed.
"Equity Stock" shall mean one or more shares of any class of capital
stock of the Corporation.
"Excess Transfer" has the meaning set forth in Section 11.3(A) of this
Article.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Issue Date" shall mean February 18, 1999.
"Initial Dividend Period" shall mean the period commencing on and
including the Issue Date and ending on and including April 14, 1999.
"Initial Holder" shall mean Terry Considine.
"Initial Holder Limit" shall mean a number of the Outstanding shares of
Class K Preferred Stock of the Corporation having an Aggregate Value
not in excess of the excess of (x) 15% of the Aggregate Value of all
Outstanding shares of Equity Stock over (y) the Aggregate Value of all
shares of Equity Stock other than Class K Preferred Stock that are
Beneficially Owned by the Initial Holder. From the Issue Date, the
secretary of the Corporation, or such other person as shall be
designated by the Board of Directors, shall upon request make available
to the representative(s) of the Initial Holder and the Board of
4
<PAGE> 5
Directors, a schedule that sets forth the then-current Initial Holder
Limit applicable to the Initial Holder.
"Junior Stock" shall have the meaning set forth in paragraph (c) of
Section 8 of this Article.
"Liquidation Preference" shall have the meaning set forth in paragraph
(a) of Section 4 of this Article.
"Look-Through Entity" shall mean a Person that is either (i) described
in Section 401(a) of the Code as provided under Section 856(h)(3) of
the Code or (ii) registered under the Investment Company Act of 1940.
"Look-Through Ownership Limit" shall mean, for any Look-Through Entity,
a number of the Outstanding shares of Class K Preferred Stock of the
Corporation having an Aggregate Value not in excess of the excess of
(x) 15% of the Aggregate Value of all Outstanding shares of Equity
Stock over (y) the Aggregate Value of all shares of Equity Stock other
than Class K Preferred Stock that are Beneficially Owned by the
Look-Through Entity.
"Market Price" on any date shall mean, with respect to any share of
Equity Stock, the Closing Price of a share of that class of Equity
Stock on the Trading Day immediately preceding such date.
"NYSE" shall mean the New York Stock Exchange, Inc.
"Operating Partnership" shall mean AIMCO Properties, L.P., a Delaware
limited partnership.
"Outstanding" shall mean issued and outstanding shares of Equity Stock
of the Corporation, provided that for purposes of the application of
the Ownership Limit, the Look-Through Ownership Limit or the Initial
Holder Limit to any Person, the term "Outstanding" shall be deemed to
include the number of shares of Equity Stock that such Person alone, at
that time, could acquire pursuant to any options or convertible
securities.
"Ownership Limit" shall mean, for any Person other than the Initial
Holder or a Look-Through Entity, a number of the Outstanding shares of
Class K Preferred Stock of the Corporation having an Aggregate Value
not in excess of the excess of (x) 8.7% of the Aggregate Value of all
Outstanding shares of Equity Stock over (y) the Aggregate Value of all
shares of Equity Stock other than Class K Preferred Stock that are
Beneficially Owned by the Person.
"Ownership Restrictions" shall mean collectively the Ownership Limit,
as applied to Persons other than the Initial Holder or Look-Through
Entities, the
5
<PAGE> 6
Initial Holder Limit, as applied to the Initial Holder, and the
Look-Through Ownership Limit, as applied to Look-Through Entities.
"Parity Stock" shall have the meaning set forth in paragraph (b) of
Section 8 of this Article.
"Person" shall mean (a) for purposes of Section 11 of this Article, (i)
an individual, corporation, partnership, estate, trust (including a
trust qualifying under Section 401(a) or 501(c) of the Code),
association, "private foundation," within the meaning of Section 509(a)
of the Code, joint stock company or other entity, and (ii) a "group,"
as that term is used for purposes of Section 13(d)(3) of the Exchange
Act, and (b) for purposes of the remaining Sections of this Article,
any individual, firm, partnership, corporation or other entity,
including any successor (by merger or otherwise) of such entity.
"Prohibited Transferee" has the meaning set forth in Section 11.3(A) of
this Article.
"Record Date" shall have the meaning set forth in paragraph (a) of
Section 3 of this Article.
"Redemption Market Price" shall mean, with respect to any redemption of
shares of Class K Preferred Stock, the lesser of (i) the average of the
daily Closing Prices of the Class A Common Stock for the 20 consecutive
Trading Days immediately preceding the first Business Day immediately
preceding the date of the applicable redemption notice and (ii) the
Closing Price of the Class A Common Stock on the Trading Day
immediately preceding the first Business Day immediately preceding the
date of the applicable redemption notice.
"Redemption Date" shall mean, in the case of any redemption of any
shares of Class K Preferred Stock, the date fixed for redemption of
such shares.
"REIT" shall mean a "real estate investment trust," as defined in
Section 856 of the Code.
"Senior Stock" shall have the meaning set forth in paragraph (a) of
Section 8 of this Article.
"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 capital stock of the Corporation; provided, however,
that if any funds for any class or series of Junior Stock or any class
or series of Parity Stock are placed in a separate
6
<PAGE> 7
account of the Corporation or delivered to a disbursing, paying or
other similar agent, then "set apart for payment" with respect to the
Class K Preferred Stock 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, when used with respect to any Equity Stock,
(i) if the Equity Stock is listed or admitted to trading on the NYSE, a
day on which the NYSE is open for the transaction of business, (ii) if
the Equity Stock is not listed or admitted to trading on the NYSE but
is listed or admitted to trading on another national securities
exchange or automated quotation system, a day on which the principal
national securities exchange or automated quotation system, as the case
may be, on which the Equity Stock is listed or admitted to trading is
open for the transaction of business, or (iii) if the Equity Stock is
not listed or admitted to trading on any national securities exchange
or automated quotation system, any day other than a Saturday, a Sunday
or a day on which banking institutions in the State of New York are
authorized or obligated by law or executive order to close.
"Transfer" shall mean any sale, transfer, gift, assignment, devise or
other disposition of a share of Class K Preferred Stock (including (i)
the granting of an option or any series of such options or entering
into any agreement for the sale, transfer or other disposition of Class
K Preferred Stock or (ii) the sale, transfer, assignment or other
disposition of any securities or rights convertible into or
exchangeable for Class K Preferred Stock), whether voluntary or
involuntary, whether of record or Beneficial Ownership, and whether by
operation of law or otherwise (including, but not limited to, any
transfer of an interest in other entities that results in a change in
the Beneficial Ownership of shares of Class K Preferred Stock). The
term "Transfers" and "Transferred" shall have correlative meanings.
"Transfer Agent" means such transfer agent as may be designated by the
Board of Directors or their designee as the transfer agent for the
Class K Preferred Stock; provided, that if the Corporation has not
designated a transfer agent then the Corporation shall act as the
transfer agent for the Class K Preferred Stock.
"Trust" shall mean the trust created pursuant to Section 11.3 of this
Article.
"Trustee" shall mean the Person unaffiliated with either the
Corporation or the Prohibited Transferee that is appointed by the
Corporation to serve as trustee of the Trust.
"Voting Preferred Stock" shall have the meaning set forth in Section 9
of this Article.
7
<PAGE> 8
3. DIVIDENDS.
(a) The holders of Class K Preferred Stock shall be entitled
to receive, when and as declared by the Board of Directors, out of funds legally
available for that purpose, quarterly cash dividends on the Class K Preferred
Stock in an amount per share equal to (i) during the period from the Issue Date
through and including February 17, 2002, the greater of $0.50 or the quarterly
cash dividend paid or payable (determined on each Dividend Payment Date) on the
number of shares of Class A Common Stock (or portion thereof) into which a share
of Class K Preferred Stock is convertible, and (ii) during the period from and
after February 18, 2002, the greater of $0.625 or the quarterly cash dividend
paid or payable (determined on each Dividend Payment Date) on the number of
shares of Class A Common Stock (or portion thereof) into which a share of Class
K Preferred Stock is convertible. Such dividends shall be cumulative from the
Issue Date, whether or not in any Dividend Period or Periods such dividends
shall be declared or there shall be funds of the Corporation legally available
for the payment of such dividends, and shall be payable quarterly in arrears on
each Dividend Payment Date, commencing on April 15, 1999. Each such dividend
shall be payable in arrears to the holders of record of the Class K Preferred
Stock, as they appear on the stock records of the Corporation at the close of
business on the January 1, April 1, July 1 or October 1 (each a "Record Date"),
as the case may be, immediately preceding such Dividend Payment Date.
Accumulated, accrued and unpaid dividends for any past Dividend Periods may be
declared and paid at any time, without reference to any regular Dividend Payment
Date, to holders of record on such date, which date shall not precede by more
than 45 days the payment date thereof, as may be fixed by the Board of
Directors.
(b) Any dividend payable on the Class K Preferred Stock for
any partial dividend period shall be computed ratably on the basis of twelve
30-day months and a 360-day year. Holders of Class K Preferred Stock shall not
be entitled to any dividends, whether payable in cash, property or stock, in
excess of full cumulative dividends, as herein provided, on the Class K
Preferred Stock. No interest, or sum of money in lieu of interest, shall be
payable in respect of any dividend payment or payments on the Class K Preferred
Stock that may be in arrears.
(c) So long as any of the shares of Class K Preferred Stock
are outstanding, except as described in the immediately following sentence, no
dividends shall be declared or paid or set apart for payment by the Corporation
and no other distribution of cash or other property shall be declared or made,
directly or indirectly, by the Corporation with respect to any shares of Parity
Stock unless, in each case, dividends equal to the full amount of accumulated,
accrued and unpaid dividends on all outstanding shares of Class K Preferred
Stock have been or contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof has been or contemporaneously is set apart
for payment of such dividends on the Class K Preferred Stock for all Dividend
Periods ending on or prior to the date such dividend or distribution is
declared, paid, set apart for payment or made, as the case may be, with respect
to such shares of Parity Stock. When dividends are not paid in full or a sum
sufficient for such payment is not set apart, as aforesaid, all dividends
declared
8
<PAGE> 9
upon the Class K Preferred Stock and all dividends declared upon any shares of
Parity Stock shall be declared ratably in proportion to the respective amounts
of dividends accumulated, accrued and unpaid on the Class K Preferred Stock and
accumulated, accrued and unpaid on such Parity Stock.
(d) So long as any of the shares of Class K Preferred Stock
are outstanding, no dividends (other than dividends or distributions paid in
shares of, or options, warrants or rights to subscribe for or purchase shares
of, Junior Stock) shall be declared or paid or set apart for payment by the
Corporation and no other distribution of cash or other property shall be
declared or made, directly or indirectly, by the Corporation with respect to any
shares of Junior Stock, nor shall any shares of Junior Stock be redeemed,
purchased or otherwise acquired (other than a redemption, purchase or other
acquisition of Common Stock 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
shares of any such stock), directly or indirectly, by the Corporation (except by
conversion into or exchange for shares of, or options, warrants or rights to
subscribe for or purchase shares of, Junior Stock), nor shall any other cash or
other property otherwise be paid or distributed to or for the benefit of any
holder of shares of Junior Stock in respect thereof, directly or indirectly, by
the Corporation unless, in each case, dividends equal to the full amount of all
accumulated, accrued and unpaid dividends on all outstanding shares of Class K
Preferred Stock have been declared and paid, or such dividends have been
declared and a sum sufficient for the payment thereof has been set apart for
such payment, on all outstanding shares of Class K Preferred Stock for all
Dividend Periods ending on or prior to the date such dividend or distribution is
declared, paid, set apart for payment or made with respect to such shares of
Junior Stock, or the date such shares of Junior Stock are redeemed, purchased or
otherwise acquired or monies paid to or made available for any sinking fund for
such redemption, or the date any such cash or other property is paid or
distributed to or for the benefit of any holders of Junior Stock in respect
thereof, as the case may be.
Notwithstanding the provisions of this Section 3, the
Corporation shall not be prohibited from (i) declaring or paying or setting
apart for payment any dividend or distribution on any shares of Parity Stock or
(ii) redeeming, purchasing or otherwise acquiring any Parity Stock, in each
case, if such declaration, payment, redemption, purchase or other acquisition is
necessary in order to maintain the continued qualification of the Corporation as
a REIT under Section 856 of the Code.
4. LIQUIDATION PREFERENCE.
(a) In the event of any liquidation, dissolution or winding up
of the Corporation, whether voluntary or involuntary, before any payment or
distribution by the Corporation (whether of capital, surplus or otherwise) shall
be made to or set apart for the holders of Junior Stock, the holders of shares
of Class K Preferred Stock shall be entitled to receive Twenty-Five Dollars
($25) per share of Class K Preferred Stock
9
<PAGE> 10
(the "Liquidation Preference"), plus an amount equal to all dividends (whether
or not earned or declared) accumulated, accrued and unpaid thereon to the date
of final distribution to such holders; but such holders shall not be entitled to
any further payment. Until the holders of the Class K Preferred Stock have been
paid the Liquidation Preference in full, plus an amount equal to all dividends
(whether or not earned or declared) accumulated, accrued and unpaid thereon to
the date of final distribution to such holders, no payment will be made to any
holder of Junior Stock upon the liquidation, dissolution or winding up of the
Corporation. If, upon any liquidation, dissolution or winding up of the
Corporation, the assets of the Corporation, or proceeds thereof, distributable
among the holders of Class K Preferred Stock 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 Stock, then such assets, or the proceeds
thereof, shall be distributed among the holders of Class K Preferred Stock and
any such other Parity Stock ratably in the same proportion as the respective
amounts that would be payable on such Class K Preferred Stock and any such other
Parity Stock 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, (ii) a sale or transfer of all or substantially all of the
Corporation's assets, 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) Upon any liquidation, dissolution or winding up of the
Corporation, after payment shall have been made in full to the holders of Class
K Preferred Stock and any Parity Stock, as provided in Section 4(a), any other
series or class or classes of Junior Stock shall, subject to the respective
terms thereof, be entitled to receive any and all assets remaining to be paid or
distributed, and the holders of the Class K Preferred Stock and any Parity Stock
shall not be entitled to share therein.
5. REDEMPTION AT THE OPTION OF THE CORPORATION.
(a) Shares of Class K Preferred Stock shall not be redeemable
by the Corporation prior to February 18, 2002, except as set forth in Section
11.2 of this Article. During the period beginning on February 18, 2002, the
Corporation, at its option, may redeem shares of Class K Preferred Stock, in
whole or from time to time in part, at a redemption price payable in cash equal
to the Cash Redemption Price applicable thereto. On and after February 18, 2002,
the Corporation, at its option, may redeem shares of Class K Preferred Stock, in
whole or from time to time in part, in exchange for a number of shares of Class
A Common Stock equal to (i) 105% of the applicable Cash Redemption Price,
divided by (ii) the Redemption Market Price applicable to such redemption. In
lieu of any fractional shares of Class A Common Stock which would otherwise be
issuable upon any redemption of Class K Preferred Stock, the Corporation shall
pay a cash adjustment in respect of such fractional interest in an amount in
cash (computed to the nearest cent) equal to the applicable Redemption Market
Price multiplied by the fractional interest (computed to the nearest 1/100th of
10
<PAGE> 11
a percent) that otherwise would have been deliverable upon such redemption of
Class K Preferred Stock. In the event of a redemption of shares of Class K
Preferred Stock, if the Redemption Date occurs after a dividend record date and
on or prior to the related Dividend Payment Date, the dividend payable on such
Dividend Payment Date in respect of such shares called for redemption shall be
payable on such Dividend Payment Date to the holders of record at the close of
business on such dividend record date notwithstanding the redemption of such
shares, and shall not be payable as part of the redemption price for such
shares. In connection with any redemption for cash pursuant to this Section
5(a), the redemption price of the Class K Preferred Stock (other than any
portion thereof consisting of accumulated, accrued and unpaid dividends) shall
be payable solely with the proceeds from the sale by the Corporation or the
Operating Partnership of other capital shares of the Corporation or the
Operating Partnership (whether or not such sale occurs concurrently with such
redemption). For purposes of the preceding sentence, "capital shares" means any
common stock, preferred stock, depositary shares, partnership or other
interests, participations or other ownership interests (however designated) and
any rights (other than debt securities convertible into or exchangeable at the
option of the holder for equity securities (unless and to the extent such debt
securities are subsequently converted into capital shares)) or options to
purchase any of the foregoing of or in the Corporation or the Operating
Partnership.
(b) The Redemption Date shall be selected by the Corporation,
shall be specified in the notice of redemption and shall be not less than 30
days nor more than 60 days after the date notice of redemption is sent by the
Corporation.
(c) If full cumulative dividends on all outstanding shares of
Class K Preferred Stock have not been declared and paid, or declared and set
apart for payment, no shares of Class K Preferred Stock may be redeemed unless
all outstanding shares of Class K Preferred Stock are simultaneously redeemed,
and neither the Corporation nor any affiliate of the Corporation may purchase or
acquire shares of Class K Preferred Stock, otherwise than pursuant to a purchase
or exchange offer made on the same terms to all holders of shares of Class K
Preferred Stock.
(d) If the Corporation shall redeem shares of Class K
Preferred Stock pursuant to paragraph (a) of this Section 5, notice of such
redemption shall be given to each holder of record of the shares to be redeemed.
Such notice shall be provided by first class mail, postage prepaid, at such
holder's address as the same appears on the stock records of the Corporation.
Neither the failure to mail any notice required by this paragraph (d), 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. Any notice which has been mailed in the
manner herein provided shall be conclusively presumed to have been duly given on
the date mailed whether or not the holder receives the notice. Each such notice
shall state, as appropriate: (i) the Redemption Date; (ii) the number of shares
of Class K Preferred Stock to be redeemed and, if fewer than all such shares
11
<PAGE> 12
held by such holder are to be redeemed, the number of such shares to be redeemed
from such holder; (iii) the place or places at which certificates for such
shares are to be surrendered for cash or shares of Class A Common Stock; and
(iv) the redemption price payable on such Redemption Date (whether in cash or
shares of Class A Common Stock), including, without limitation, a statement as
to whether or not accumulated, accrued and unpaid dividends will be payable as
part of the redemption price, or payable on the next Dividend Payment Date to
the record holder at the close of business on the relevant record date as
described in the next succeeding sentence. Notice having been mailed as
aforesaid, from and after the Redemption Date (unless the Corporation shall fail
to make available the amount of cash necessary to effect such redemption), (i)
dividends on the shares of Class K Preferred Stock so called for redemption
shall cease to accumulate or accrue on the shares of Class K Preferred Stock
called for redemption, (ii) said shares shall no longer be deemed to be
outstanding, and (iii) all rights of the holders thereof as holders of Class K
Preferred Stock of the Corporation shall cease except the right to receive the
cash payable, or shares of Class A Common Stock issuable, upon such redemption,
without interest thereon, upon surrender of their certificates if so required;
provided, however, that if the Redemption Date for any shares of Class K
Preferred Stock occurs after any dividend record date and on or prior to the
related Dividend Payment Date, the full dividend payable on such Dividend
Payment Date in respect of such shares of Class K Preferred Stock called for
redemption shall be payable on such Dividend Payment Date to the holders of
record of such shares at the close of business on the corresponding dividend
record date notwithstanding the prior redemption of such shares. At the close of
business on the Redemption Date, without any further action, each holder of
shares of Class K Preferred Stock redeemed for shares of Class A Common Stock
shall be deemed a holder of the number of shares of Class A Common Stock for
which such Class K Convertible Preferred Stock has been redeemed (unless the
Corporation defaults on its obligation to deliver shares of Class A Common Stock
or cash). The Corporation's obligation to make available the cash necessary to
effect such redemption in accordance with the preceding sentence shall be deemed
fulfilled if, on or before the applicable Redemption Date, the Corporation shall
irrevocably deposit in trust with a bank or trust company (which may not be an
affiliate of the Corporation) that has, or is an affiliate of a bank or trust
company that has, a capital and surplus of at least $50,000,000, such amount of
cash as is necessary for such redemption plus, if such Redemption Date occurs
after any dividend record date and on or prior to the related Dividend Payment
Date, such amount of cash as is necessary to pay the dividend payable on such
Dividend Payment Date in respect of such shares of Class K Preferred Stock
called for redemption, with irrevocable instructions that such cash be applied
to the redemption of the shares of Class K Preferred Stock so called for
redemption and, if applicable, the payment of such dividend. No interest shall
accrue for the benefit of the holders of shares of Class K Preferred Stock 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
Redemption Date shall revert to the general funds of the Corporation, after
which reversion the holders of
12
<PAGE> 13
shares of Class K Preferred Stock 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 of Class K Preferred Stock to be
so redeemed (properly endorsed or assigned for transfer, if the Corporation
shall so require and the notice shall so state), such certificates shall be
exchanged for cash (without interest thereon) or shares of Class A Common Stock
for which such shares have been redeemed in accordance with such notice. If
fewer than all the outstanding shares of Class K Preferred Stock are to be
redeemed, shares to be redeemed shall be selected by the Corporation from
outstanding shares of Class K Preferred Stock not previously called for
redemption by lot or, with respect to the number of shares of Class K Preferred
Stock held of record by each holder of such shares, pro rata (as nearly as may
be) or by any other method as may be determined by the Board of Directors in its
discretion to be equitable. If fewer than all the shares of Class K Preferred
Stock represented by any certificate are redeemed, then a new certificate
representing the unredeemed shares shall be issued without cost to the holders
thereof.
(e) All shares of Class A Common Stock that may be issued upon
redemption of shares of Class K Preferred Stock shall be duly and validly issued
and fully paid and non-assessable, and prior to giving any notice of redemption
the Corporation shall take any corporate action necessary therefor.
6. STATUS OF REACQUIRED STOCK.
All shares of Class K Preferred Stock that have been issued and
reacquired in any manner by the Corporation (including, without limitation,
shares of Class K Preferred Stock which have been surrendered for conversion)
shall be returned to the status of authorized but unissued shares of Class K
Preferred Stock.
7. CONVERSION.
7.1 CONVERSION AT HOLDERS' OPTION.
At any time on or after the Issue Date, holders of shares of Class K
Preferred Stock shall have the right to convert all or a portion of such shares
into shares of Class A Common Stock, as follows:
(a) Subject to and upon compliance with the provisions of this
Section 7, each share of Class K Preferred Stock shall, at the option of the
holder thereof, be convertible at any time (unless such share is called for
redemption, then to and including but not after the close of business on the
date immediately prior to the Redemption Date, unless the Corporation shall
default in payment due upon redemption thereof), into that number of fully paid
and non-assessable shares of Class
13
<PAGE> 14
A Common Stock (calculated as to each conversion to the nearest 1/100th of a
share) obtained by dividing $25 by the Conversion Price in effect at such time
and by surrender of the certificate representing such shares to be converted in
the manner provided in subsection (b) of this Section 7.1.
(b) In order to convert shares of Class K Preferred Stock, the
holder of the shares to be converted shall surrender the certificate
representing such shares at any office or agency maintained by the Corporation
for such purpose, accompanied by the funds, if any, required by the last
paragraph of this subsection (b), and shall give written notice of conversion in
the form provided on such certificate representing shares of Class K Preferred
Stock (or such other notice as is acceptable to the Corporation) to the
Corporation at such office or agency that the holder elects to convert the
shares of Class K Preferred Stock specified in such notice. Such notice shall
also state the name or names, together with address or addresses, in which the
certificate or certificates for shares of Class A Common Stock which shall be
issuable in such conversion shall be issued. Unless the shares issuable on
conversion are to be issued in the same name as the name in which such share of
Class K Preferred Stock is registered, each certificate representing a share of
Class K Preferred Stock 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.
As promptly as practicable after the surrender of certificates
representing such shares of Class K Preferred Stock and the receipt of such
notice, instruments of transfer and funds, if any, as aforesaid, the Corporation
shall issue and shall deliver at such office or agency to such holder, or as
designated in such holder's written instructions, a certificate or certificates
for the number of full shares of Class A Common Stock issuable upon the
conversion of such share or shares of Class K Preferred Stock in accordance with
provisions of this Section 7, and a check or cash in respect of any fractional
interest in a share of Class A Common Stock arising upon such conversion, as
provided in paragraph (c) of this Section 7.1.
Each conversion shall be deemed to have been effected
immediately prior to the close of business on the date on which certificates
representing such shares of Class K Preferred Stock shall have been surrendered
and such notice (and any applicable instruments of transfer and any required
taxes) received by the Corporation as aforesaid, and the Person or Persons in
whose name or names any certificate or certificates for shares of Class A Common
Stock 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 stock 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 stock transfer books are open,
14
<PAGE> 15
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.
Holders of Class K Preferred Stock at the close of business on
a Record Date will be entitled to receive an amount equal to the dividend
payable on such shares on the corresponding Dividend Payment Date
notwithstanding the conversion of such shares following such Record Date and
prior to such Dividend Payment Date; provided, however, that Class K Preferred
Stock surrendered for conversion during the period between the close of business
on any Record Date and the opening of business on the corresponding Dividend
Payment Date (except shares converted after the issuance of a notice of
redemption with respect to a Redemption Date during such period or coinciding
with such Dividend Payment Date, which will be entitled to such dividend) must
be accompanied by payment of an amount equal to the dividend payable on such
shares on such Dividend Payment Date. A holder of Class K Preferred Stock on a
Record Date who (or whose transferee) tenders any such shares for conversion
into shares of Class A Common Stock on such Dividend Payment Date will receive
the dividend payable by the Corporation on such shares of Class K Preferred
Stock on such date, and the converting holder need not include payment of the
amount of such dividend upon surrender of Class K Preferred Stock for
conversion. Except as provided herein, the Corporation will make no payment or
allowance for unpaid dividends, whether or not in arrears, on converted shares
or for dividends on the Class A Common Stock issued upon such conversion.
(c) No fractional shares of Class A Common Stock or scrip
representing fractions of a share of Class A Common Stock shall be issued upon
conversion of shares of Class K Preferred Stock. If more than one share of Class
K Preferred Stock shall be surrendered for conversion at one time by the same
holder, the number of full shares of Class A Common Stock issuable upon
conversion thereof shall be computed on the basis of the aggregate number of
shares of Class K Preferred Stock so surrendered. In lieu of any fractional
interest in a share of Class A Common Stock that would otherwise be deliverable
upon the conversion any share of Class K Preferred Stock, the Corporation shall
pay to the holder of such shares an amount in cash (computed to the nearest
cent) equal to the Closing Price of the Class A Common Stock on the Trading Day
immediately preceding the date of conversion, multiplied by the fractional
interest that otherwise would have been deliverable upon conversion of such
share.
7.2 ADJUSTMENTS TO CONVERSION PRICE
(a) 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 Class A Common Stock in
shares of Class A Common Stock, (B) subdivide its outstanding shares of Class A
Common Stock into
15
<PAGE> 16
a greater number of shares, (C) combine its outstanding shares of Class A Common
Stock into a smaller number of shares or (D) issue any shares of capital stock
by reclassification of its outstanding Class A Common Stock, then, in each such
case, the Conversion Price in effect immediately prior to such action shall be
adjusted so that the holder of any share of Class K Preferred Stock thereafter
surrendered for conversion shall be entitled to receive the number of shares of
Class A Common Stock or other capital stock of the Corporation which such holder
would have owned or been entitled to receive immediately following such action
had such share been converted immediately prior to the occurrence of such event.
An adjustment made pursuant to this subsection (i) of this Section 7.2(a) shall
become effective immediately after the record date, in the case of a dividend or
distribution, or immediately after the effective date, in the case of a
subdivision, combination or reclassification. If, as a result of an adjustment
made pursuant to this subsection (i), the holder of any share of Class K
Preferred Stock thereafter surrendered for conversion shall become entitled to
receive shares of two or more classes of capital stock or shares of Class A
Common Stock and other capital stock of the Corporation, the Board of Directors
(whose determination shall be conclusive and shall be described in a statement
filed by the Corporation with the Transfer Agent) shall determine the allocation
of the adjusted Conversion Price between or among shares of such classes of
capital stock or shares of Class A Common Stock and other capital stock.
(ii) If the Corporation shall, after the Issue Date,
issue rights, options or warrants to all holders of its outstanding shares of
Class A Common Stock entitling them (for a period expiring within 45 days after
the record date described below) to subscribe for or purchase shares of Class A
Common Stock at a price per share less than the current market price per share
(determined pursuant to subsection (iv) of this Section 7.2(a)) of the Class A
Common Stock (other than pursuant to any stock option, restricted stock or other
incentive or benefit plan or stock ownership or purchase plan for the benefit of
employees, directors or officers or any dividend reinvestment plan of the
Corporation in effect at the time hereof or any other similar plan adopted or
implemented hereafter), then the Conversion Price in effect immediately prior
thereto shall be adjusted so that it shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the record date
by a fraction, the numerator of which shall be the sum of (A) the number of
shares of Class A Common Stock outstanding on the record date and (B) the number
of shares which the aggregate proceeds to the Corporation from the exercise of
such rights, options or warrants for Class A Common Stock would purchase at such
current market price, and the denominator of which shall be the sum of (A) the
number of shares of Class A Common Stock outstanding on the record date and (B)
the number of additional shares of Class A Common Stock offered for subscription
or purchase pursuant to such rights, options or warrants. Such adjustment shall
be made successively whenever any rights, options or warrants are issued, and
shall become effective immediately after the record date for the determination
of stockholders entitled to receive such rights, options or warrants; provided,
however, that if all of the shares of Class A Common Stock offered for
subscription or purchase are not
16
<PAGE> 17
delivered upon the exercise of such rights, options or warrants, upon the
expiration of such rights, options or warrants, the Conversion Price shall be
readjusted to the Conversion Price which would have been in effect had the
numerator and the denominator of the foregoing fraction and the resulting
adjustment been made based upon the number of shares of Class A Common Stock
actually delivered upon the exercise of such rights, options or warrants rather
than upon the number of shares of Class A Common Stock offered for subscription
or purchase. In determining whether any rights, options or warrants entitle the
holders to subscribe for or purchase shares of Class A Common Stock at less than
such current market price, and in determining the aggregate offering price of
such shares of Class A Common Stock, there shall be taken into account any
consideration received by the Corporation for such rights, options or warrants,
with the value of such consideration, if other than cash, determined by the
Board of Directors (whose determination shall be conclusive and shall be
described in a statement filed by the Corporation with the Transfer Agent).
(iii) In case the Corporation shall, by dividend or
otherwise, distribute to all holders of its outstanding Class A Common Stock any
capital stock (other than Class A Common Stock), evidences of its indebtedness
or assets or rights or warrants to subscribe for or purchase securities of the
Corporation (excluding (A) those referred to in subsections (i) and (ii) of this
Section 7.2(a), (B) dividends and distributions paid in cash out of the retained
earnings of the Corporation, and (C) distributions upon mergers or
consolidations to which subsection (b) of this Section 7.2 applies), then, in
each such case, the Conversion Price shall be adjusted to equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the record date of such distribution by a fraction, the numerator of which shall
be the current market price per share (determined pursuant to subsection (iv) of
this Section 7.2(a)) of the Class A Common Stock, less the fair market value on
such record date (determined by the Board or Directors, whose determination
shall be conclusive and shall be described in a statement filed by the
Corporation with the Transfer Agent) of the portion of the capital stock or
assets or the evidences of indebtedness or assets so distributed to the holder
of one share of Class A Common Stock or of such subscription rights or warrants
applicable to one share of Class A Common Stock, and the denominator of which
shall be such current market price per share of Class A Common Stock. Such
adjustment shall become effective immediately after the record date for the
determination of stockholders entitled to receive such distribution.
(iv) For the purpose of any computation under
subsections (ii) and (iii) of this Section 7.2(a), the current market price per
share of Class A Common Stock on any date shall be the average of the Closing
Price of the Class A Common Stock for the shorter of (A) 20 consecutive Trading
Days ending on the last full Trading Day prior to the Time of Determination or
(B) the period commencing on the date next succeeding the first public
announcement of the issuance of such rights or warrants or such distribution
through such last full Trading Day prior to the Time of Determination. For
purposes of the foregoing, the term "Time of Determination" shall mean the time
and date of the earlier of (A) the record date for determining
17
<PAGE> 18
stockholders entitled to receive the rights, warrants or distribution referred
to in subsections (ii) and (iii) of this Section 7.2, or (B) the commencement of
"ex-dividend" trading on the exchange or market referred to in the definition of
"Closing Price."
(v) No adjustment in the Conversion Price shall be required to
be made unless such adjustment would require an increase or decrease of at least
one percent of such price; provided, however, that any adjustment which by
reason of this subsection (v) is not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Section 7.2 shall be made to the nearest cent or to the nearest
1/100th of a share, as the case may be. Anything in this Section 7.2 to the
contrary notwithstanding, the Corporation shall be entitled to make such
reduction in the Conversion Price, in addition to those required by this Section
7.2, as it shall determine in its discretion to be advisable in order that any
stock dividend, subdivision of shares, distribution of rights to purchase stock
or securities, or distribution of securities convertible into or exchangeable
for stock hereafter made by the Corporation to its stockholders shall not be
taxable to the recipients. Except as set forth in subsections (i), (ii) and
(iii) above, the Conversion Price shall not be adjusted for the issuance of
Class A Common Stock, or any securities convertible into or exchangeable for
Class A Common Stock or carrying the right to purchase any of the foregoing, in
exchange for cash, property or services.
(vi) The Corporation from time to time may decrease the
Conversion Price by any amount for any period of time if the period is at least
20 days and if the decrease is irrevocable during the period. Whenever the
Conversion Price is so decreased, the Corporation shall mail to holders of
record of shares of Class K Preferred Stock a notice of the decrease at least 15
days before the date the decreased Conversion Price takes effect, and such
notice shall state the decreased Conversion Price and the period it will be in
effect.
(b) Notwithstanding any other provision herein to the
contrary, in case of any merger or consolidation to which the Corporation is a
party (other than a merger or consolidation in which the Corporation is the
continuing entity and in which the Class A Common Stock outstanding immediately
prior to the merger or consolidation is not exchanged for cash, or the
securities or other property of another entity), or in the case of any sale or
transfer of all or substantially all of the Corporation's property and assets to
another entity, there will be no adjustment of the Conversion Price, and lawful
provision shall be made by the entity formed by such consolidation or the entity
whose securities, cash or other property will immediately after the merger or
consolidation be owned, by virtue of the merger or consolidation, by the holders
of Class A Common Stock immediately prior to the merger or consolidation, or the
entity which shall have acquired such assets of the Corporation, such that each
share of Class K Preferred Stock then outstanding will, without the consent of
the holder thereof, become convertible into the kind and amount of securities,
cash or other property receivable upon such merger, consolidation, sale or
transfer by a holder of the number of shares of Class A Common Stock into which
such share of Class K Preferred Stock
18
<PAGE> 19
was convertible immediately prior to such merger, consolidation, sale or
transfer assuming such holder of Class A Common Stock did not exercise his
rights of election, if any, as to the kind or amount of securities, cash or
other property receivable upon such merger, consolidation, sale or transfer. In
the case of a cash merger of the Corporation into another entity or any other
cash transaction of the type mentioned in this Section 7.2(b), each share of
Class K Preferred Stock will thereafter be convertible at the Conversion Price
in effect at such time into the same amount of cash per share into which each
share of Class K Preferred Stock would have been convertible had such share been
converted into Class A Common Stock immediately prior to the effective date of
such cash merger or other transaction. The foregoing provisions of this Section
7.2(b) shall similarly apply to successive mergers, consolidations, sales or
transfers.
(c) If (i) the Corporation shall take any action that would
require an adjustment in the Conversion Price pursuant to Section 7.2; (ii) the
Corporation shall authorize the granting to the holders of the Class A Common
Stock generally of rights or warrants to subscribe for or purchase any shares of
stock of any class or series or of any other rights or warrants; (iii) there
shall be any reorganization or reclassification of the Class A Common Stock
(other than an event to which subsection (i) of Section 7.2(a) applies) or any
consolidation or merger to which the Corporation is a party or any sale or
transfer of all or substantially all of the assets of the Corporation, in each
case, for which approval of any stockholders of the Corporation is required; or
(iv) there shall be a voluntary or involuntary liquidation, dissolution or
winding up of the Corporation; then, in each such case, the Corporation shall
cause to be given to the holders of shares of Class K Preferred Stock and the
Transfer Agent as promptly as possible, but in any event at least 15 days prior
to the applicable date hereinafter specified, a notice stating (i) the date on
which a record is to be taken for the purpose of such action or granting of
rights or warrants, or, if a record is not to be taken, the date as of which the
holders of Class A Common Stock of record to be entitled to such dividend,
distribution, rights or warrants are to be determined, or (ii) the date on which
such reorganization, reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution or winding up is expected to become effective or occur,
and the date as of which it is expected that holders of Class A Common Stock of
record shall be entitled to exchange their shares of Class A Common Stock for
securities, cash or other property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution or winding up. Failure to give such notice or any defect therein
shall not affect the legality or validity of the proceedings described in this
Section 7.2(c).
(d) Whenever the Conversion Price is adjusted as herein
provided, (i) the Corporation shall promptly file with the Transfer Agent a
certificate setting forth the Conversion Price after such adjustment and a brief
statement of the facts requiring such adjustment and the manner of computing the
same, which certificate shall be conclusive evidence of the correctness of such
adjustment, and (ii) the Corporation shall mail or cause to be mailed by first
class mail, postage prepaid, as
19
<PAGE> 20
soon as practicable to each holder of record of shares of Class K Preferred
Stock a notice stating that the Conversion Price has been adjusted and setting
forth the adjusted Conversion Price.
(e) In any case in which paragraph (a) of this Section 7.2
shall require that an adjustment be made immediately following a record date or
an effective date, the Corporation may elect to defer (but only until the filing
by the Corporation with the Transfer Agent of the certificate required by
subsection 7.2(d)) (i) issuing to the holder of any share of Class K Preferred
Stock converted after such record date or effective date the shares of Class A
Common Stock issuable upon such conversion in excess of the shares of Class A
Common Stock issuable upon such conversion on the basis of the Conversion Price
prior to adjustment, and (ii) paying to such holder any amount of cash in lieu
of a fractional share.
(f) In the event that at any time, as a result of an
adjustment made pursuant to subsection (i) of Section 7.2(a), the holder of any
share of Class K Preferred Stock thereafter surrendered for conversion shall
become entitled to receive any shares of the Corporation other than shares of
Class A Common Stock, thereafter the Conversion Price of such other shares so
receivable upon conversion of any share of Class K Preferred Stock shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to Class A Common Stock
contained in this Section 7.2.
(g) The Corporation shall at all times reserve and keep
available, free from preemptive rights, out of the aggregate of its authorized
but unissued shares of Class A Common Stock, for the purpose of effecting
conversion of shares of Class K Preferred Stock, the full number of shares of
Class A Common Stock deliverable upon the conversion of all outstanding shares
of Class K Preferred Stock not theretofore converted and on or before (and as a
condition of) taking any action that would cause an adjustment of the Conversion
Price resulting in an increase in the number of shares of Class A Common Stock
deliverable upon conversion in excess of the number thereof previously reserved
and available therefor, the Corporation shall take all such action so required.
For purposes of this paragraph (g), the number of shares of Class A Common Stock
which shall be deliverable upon the conversion of all outstanding shares of
Class K Preferred Stock shall be computed as if at the time of computation all
such outstanding shares of Class K Preferred Stock were held by a single holder
(and without regard to the Ownership Limit).
Before taking any action which would cause an adjustment reducing the
Conversion Price below the then par value (if any) of the shares of Class A
Common Stock deliverable upon conversion of the shares of Class K Preferred
Stock, the Corporation shall take any corporate action which may, in the opinion
of its counsel, be necessary in order that the Corporation may validly and
legally issue fully paid and non-assessable shares of Class A Common Stock at
such adjusted Conversion Price.
20
<PAGE> 21
(h) The Corporation will pay any and all documentary stamp,
issue or transfer taxes, and any other similar taxes, payable in respect of the
issue or delivery of shares of Class A Common Stock upon conversion of shares of
Class K Preferred Stock 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 shares of Class A Common Stock in
a name other than that of the holder of the shares of Class K Preferred Stock 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.
(i) Notwithstanding anything to the contrary contained in this
Section 7, conversion of Class K Preferred Stock pursuant to this Section 7
shall be permitted only to the extent that such conversion would not result in a
violation of the Ownership Restrictions (as defined in the Charter).
8. RANKING.
Any class or series of capital stock of the Corporation shall be deemed
to rank:
(a) prior or senior to the Class K Preferred Stock, 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 and of amounts distributable upon
liquidation, dissolution or winding up, as the case may be, in preference or
priority to the holders of Class K Preferred Stock ("Senior Stock");
(b) on a parity with the Class K Preferred Stock, 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 be different from
those of the Class K Preferred Stock, if (i) such capital stock is Class B
Cumulative Convertible Preferred Stock, Class C Cumulative Preferred Stock,
Class D Cumulative Preferred Stock, Class G Cumulative Preferred Stock, Class H
Cumulative Preferred Stock or Class J Cumulative Convertible Preferred Stock of
the Corporation, or (ii) the holders of such class of stock or series and the
Class K Preferred Stock 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 of one over the other
(the capital stock referred to in clauses (i) and (ii) of this paragraph being
hereinafter referred to, collectively, as "Parity Stock"); and
(c) junior to the Class K Preferred Stock, as to the payment
of dividends and as to the distribution of assets upon liquidation, dissolution
or winding up, if (i) such capital stock or series shall be Common Stock or (ii)
the holders of
21
<PAGE> 22
Class K Preferred Stock shall be entitled to 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 shares of such class or series (the
capital stock referred to in clauses (i) and (ii) of this paragraph being
hereinafter referred to, collectively, as "Junior Stock").
9. VOTING.
(a) If and whenever six quarterly dividends (whether or not
consecutive) payable on the Class K Preferred Stock or any series or class of
Parity Stock shall be in arrears (which shall, with respect to any such
quarterly dividend, mean that any such dividend has not been paid in full),
whether or not earned or declared, the number of directors then constituting the
Board of Directors shall be increased by two (if not already increased by reason
of similar types of provisions with respect to shares of Parity Stock of any
other class or series which is entitled to similar voting rights (the "Voting
Preferred Stock")) and the holders of shares of Class K Preferred Stock,
together with the holders of shares of all other Voting Preferred Stock then
entitled to exercise similar voting rights, voting as a single class regardless
of series, shall be entitled to elect the two additional directors to serve on
the Board of Directors at any annual meeting of stockholders or special meeting
held in place thereof, or at a special meeting of the holders of the Class K
Preferred Stock and the Voting Preferred Stock called as hereinafter provided.
Whenever all arrears in dividends on the Class K Preferred Stock and the Voting
Preferred Stock then outstanding shall have been paid and dividends thereon for
the current quarterly dividend period shall have been declared and paid, or
declared and set apart for payment, then the right of the holders of the Class K
Preferred Stock and the Voting Preferred Stock to elect such additional two
directors shall cease (but subject always to the same provision for the vesting
of such voting rights in the case of any similar future arrearages), and the
terms of office of all persons elected as directors by the holders of the Class
K Preferred Stock and the Voting Preferred Stock shall forthwith terminate and
the number of directors constituting the Board of Directors shall be reduced
accordingly. At any time after such voting power shall have been so vested in
the holders of Class K Preferred Stock and the Voting Preferred Stock, if
applicable, the Secretary of the Corporation may, and upon the written request
of any holder of Class K Preferred Stock (addressed to the Secretary at the
principal office of the Corporation) shall, call a special meeting of the
holders of the Class K Preferred Stock and of the Voting Preferred Stock for the
election of the two directors to be elected by them as herein provided, such
call to be made by notice similar to that provided in the Bylaws of the
Corporation for a special meeting of the stockholders or as required by law. If
any such special meeting required to be called as above provided shall not be
called by the Secretary within 20 days after receipt of any such request, then
any holder of Class K Preferred Stock may call such meeting, upon the notice
above provided, and for that purpose shall have access to the stock books of the
Corporation. The directors elected at any such special meeting shall hold office
until the next annual meeting of the stockholders or special meeting held in
lieu thereof if
22
<PAGE> 23
such office shall not have previously terminated as above provided. If any
vacancy shall occur among the directors elected by the holders of the Class K
Preferred Stock and the Voting Preferred Stock, a successor shall be elected by
the Board of Directors, upon the nomination of the then-remaining director
elected by the holders of the Class K Preferred Stock and the Voting Preferred
Stock or the successor of such remaining director, to serve until the next
annual meeting of the stockholders or special meeting held in place thereof if
such office shall not have previously terminated as provided above.
(b) So long as any shares of Class K Preferred Stock are
outstanding, in addition to any other vote or consent of stockholders required
by law or by the Charter of the Corporation, the affirmative vote of at least
66-2/3% of the votes entitled to be cast by the holders of the Class K Preferred
Stock voting as a single class with the holders of all other classes or series
of Parity Stock entitled to vote on such matters, 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, or the addition of any provision to, these Articles
Supplementary, the Charter or the By-Laws of the Corporation that materially
adversely affects the voting powers, rights or preferences of the holders of the
Class K Preferred Stock; provided, however, that the amendment of the provisions
of the Charter so as to authorize or create, or to increase the authorized
amount of, or issue any Junior Stock or any shares of any class of Parity Stock
shall not be deemed to materially adversely affect the voting powers, rights or
preferences of the holders of Class K Preferred Stock; or
(ii) The authorization, creation of, increase in the
authorized amount of, or issuance of any shares of any class or series of Senior
Stock or any security convertible into shares of any class or series of Senior
Stock (whether or not such class or series of Senior Stock is currently
authorized);
provided, however, that no such vote of the holders of Class K Preferred Stock
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 Senior Stock or
convertible or exchangeable security is to be made, as the case may be,
provision is made for the redemption of all shares of Class K Preferred Stock at
the time outstanding to the extent such redemption is authorized by Section 5 of
this Article.
For purposes of the foregoing provisions and all other voting rights
under these Articles Supplementary, each share of Class K Preferred Stock shall
have one (1) vote per share, except that when any other class or series of
preferred stock of the Corporation shall have the right to vote with the Class K
Preferred Stock as a single class on any matter, then the Class K Preferred
Stock and such other class or series shall have with respect to such matters one
quarter of one vote per $25 of stated liquidation preference. Except as
otherwise required by applicable law or as set forth
23
<PAGE> 24
herein or in the Charter, the Class K Preferred Stock 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.
10. RECORD HOLDERS.
The Corporation and the Transfer Agent may deem and treat the record
holder of any share of Class K Preferred Stock 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.
11.1 RESTRICTIONS ON OWNERSHIP AND TRANSFERS.
(A) LIMITATION ON BENEFICIAL OWNERSHIP. Except as provided in
Section 11.8, from and after the Issue Date, no Person (other than the Initial
Holder or a Look-Through Entity) shall Beneficially Own shares of Class K
Preferred Stock in excess of the Ownership Limit, the Initial Holder shall not
Beneficially Own shares of Class K Preferred Stock in excess of the Initial
Holder Limit and no Look-Through Entity shall Beneficially Own shares of Class K
Preferred Stock in excess of the Look- Through Ownership Limit.
(B) TRANSFERS IN EXCESS OF OWNERSHIP LIMIT. Except as provided
in Section 11.8, from and after the Issue Date (and subject to Section 11.12),
any Transfer (whether or not such Transfer is the result of transactions entered
into through the facilities of the NYSE or other securities exchange or an
automated inter-dealer quotation system) that, if effective, would result in any
Person (other than the Initial Holder or a Look-Through Entity) Beneficially
Owning shares of Class K Preferred Stock in excess of the Ownership Limit shall
be void ab initio as to the Transfer of such shares of Class K Preferred Stock
that would be otherwise Beneficially Owned by such Person in excess of the
Ownership Limit, and the intended transferee shall acquire no rights in such
shares of Class K Preferred Stock.
(C) TRANSFERS IN EXCESS OF INITIAL HOLDER LIMIT. Except as
provided in Section 11.8, from and after the Issue Date (and subject to Section
11.12), any Transfer (whether or not such Transfer is the result of transactions
entered into through the facilities of the NYSE or other securities exchange or
an automated inter-dealer quotation system) that, if effective, would result in
the Initial Holder Beneficially Owning shares of Class K Preferred Stock in
excess of the Initial Holder Limit shall be void ab initio as to the Transfer of
such shares of Class K Preferred Stock that would be otherwise Beneficially
Owned by the Initial Holder in excess of the Initial Holder limit, and the
Initial Holder shall acquire no rights in such shares of Class K Preferred
Stock.
24
<PAGE> 25
(D) TRANSFERS IN EXCESS OF LOOK-THROUGH OWNERSHIP LIMIT.
Except as provided in Section 11.8 from and after the Issue Date (and subject to
Section 11.12), any Transfer (whether or not such Transfer is the result of
transactions entered into through the facilities of the NYSE or other securities
exchange or an automated inter-dealer quotation system) that, if effective,
would result in any Look-Through Entity Beneficially Owning shares of Class K
Preferred Stock in excess of the Look- Through Ownership limit shall be void ab
initio as to the Transfer of such shares of Class K Preferred Stock that would
be otherwise Beneficially Owned by such Look- Through Entity in excess of the
Look-Through Ownership Limit and such Look- Through Entity shall acquire no
rights in such shares of Class K Preferred Stock.
(E) TRANSFERS RESULTING IN "CLOSELY HELD" STATUS. From and
after the Issue Date, any Transfer that, if effective would result in the
Corporation being "closely held" within the meaning of Section 856(h) of the
Code, or would otherwise result in the Corporation failing to qualify as a REIT
(including, without limitation, a Transfer or other event that would result in
the Corporation owning (directly or constructively) an interest in a tenant that
is described in Section 856(d)(2)(B) of the Code if the income derived by the
Corporation from such tenant would cause the Corporation to fail to satisfy any
of the gross income requirements of Section 856(c) of the Code) shall be void ab
initio as to the Transfer of shares of Class K Preferred Stock that would cause
the Corporation (i) to be "closely held" within the meaning of Section 856(h) of
the Code or (ii) otherwise fail to qualify as a REIT, as the case may be, and
the intended transferee shall acquire no rights in such shares of Class K
Preferred Stock.
(F) SEVERABILITY ON VOID TRANSACTIONS. A Transfer of a share
of Class K Preferred Stock that is null and void under Sections 11.1(B), (C),
(D), or (E) of this Article because it would, if effective, result in (i) the
ownership of Class K Preferred Stock in excess of the Initial Holder Limit, the
Ownership Limit, or the Look-Through Ownership Limit, (ii) the Corporation being
"closely held" within the meaning of Section 856(h) of the Code or (iii) the
Corporation otherwise failing to qualify as a REIT, shall not adversely affect
the validity of the Transfer of any other share of Class K Preferred Stock in
the same or any other related transaction.
11.2 REMEDIES FOR BREACH. If the Board of Directors or a committee
thereof shall at any time determine in good faith that a Transfer or other event
has taken place in violation of Section 11.1 of this Article or that a Person
intends to acquire or has attempted to acquire Beneficial Ownership of any
shares of Class K Preferred Stock in violation of Section 11.1 of this Article
(whether or not such violation is intended), the Board of Directors or a
committee thereof shall be empowered to take any action as it deems advisable to
refuse to give effect to or to prevent such Transfer or other event, including,
but not limited to, refusing to give effect to such Transfer or other event on
the books of the Corporation, causing the Corporation to redeem such shares at
the then current Market Price and upon such terms and conditions as may be
specified by the Board of Directors in its sole discretion (including, but not
limited to, by means of the issuance of long-term indebtedness for the purpose
of such redemp-
25
<PAGE> 26
tion), demanding the repayment of any distributions received in respect of
shares of Class K Preferred Stock acquired in violation of Section 11.1 of this
Article or instituting proceedings to enjoin such Transfer or to rescind such
Transfer or attempted Transfer; provided, however, that any Transfers or
attempted Transfers (or, in the case of events other than a Transfer, Beneficial
Ownership) in violation of Section 11.1 of this Article, regardless of any
action (or non-action) by the Board of Directors or such committee, (a) shall be
void ab initio or (b) shall automatically result in the transfer described in
Section 11.3 of this Article; provided, further, that the provisions of this
Section 11.2 shall be subject to the provisions of Section 11.12 of this
Article; provided, further, that neither the Board of Directors nor any
committee thereof may exercise such authority in a manner that interferes with
any ownership or transfer of Class K Preferred Stock that is expressly
authorized pursuant to Section 11.8(C) of this Article.
11.3. TRANSFER IN TRUST.
(A) ESTABLISHMENT OF TRUST. If, notwithstanding the other
provisions contained in this Article, at any time after the Issue Date there is
a purported Transfer (an "Excess Transfer") (whether or not such Transfer is the
result of transactions entered into through the facilities of the NYSE or other
securities exchange or an automated inter-dealer quotation system) or other
change in the capital structure of the Corporation (including, but not limited
to, any redemption of Equity Stock) or other event (including, but not limited
to, any acquisition of any share of Equity Stock) such that (a) any Person
(other than the Initial Holder or a Look-Through Entity) would Beneficially Own
shares of Class K Preferred Stock in excess of the Ownership Limit, or (b) the
Initial Holder would Beneficially Own shares of Class K Preferred Stock in
excess of the Initial Holder Limit, or (c) any Person that is a Look-Through
Entity would Beneficially Own shares of Class K Preferred Stock in excess of the
Look- Through Ownership Limit (in any such event, the Person, Initial Holder or
Look- Through Entity that would Beneficially Own shares of Class K Preferred
Stock in excess of the Ownership Limit, the Initial Holder Limit or the
Look-Through Entity Limit, respectively, is referred to as a "Prohibited
Transferee"), then, except as otherwise provided in Section 11.8 of this
Article, such shares of Class K Preferred Stock in excess of the Ownership
Limit, the Initial Holder Limit or the Look-Through Ownership Limit, as the case
may be, (rounded up to the nearest whole share) shall be automatically
transferred to a Trustee in his capacity as trustee of a Trust for the exclusive
benefit of one or more Charitable Beneficiaries. Such transfer to the Trustee
shall be deemed to be effective as of the close of business on the Business Day
prior to the Excess Transfer, change in capital structure or another event
giving rise to a potential violation of the Ownership Limit, the Initial Holder
Limit or the Look- Through Entity Ownership Limit.
(B) APPOINTMENT OF TRUSTEE. The Trustee shall be appointed by
the Corporation and shall be a Person unaffiliated with either the Corporation
or any Prohibited Transferee. The Trustee may be an individual or a bank or
trust company duly licensed to conduct a trust business.
26
<PAGE> 27
(C) STATUS OF SHARES HELD BY THE TRUSTEE. Shares of Class K
Preferred Stock held by the Trustee shall be issued and outstanding shares of
capital stock of the Corporation. Except to the extent provided in Section
11.3(E), the Prohibited Transferee shall have no rights in the Class K Preferred
Stock held by the Trustee, and the Prohibited Transferee shall not benefit
economically from ownership of any shares held in trust by the Trustee, shall
have no rights to dividends and shall not possess any rights to vote or other
rights attributable to the shares held in the Trust.
(D) DIVIDEND AND VOTING RIGHTS. The Trustee shall have all
voting rights and rights to dividends with respect to shares of Class K
Preferred Stock held in the Trust, which rights shall be exercised for the
benefit of the Charitable Beneficiary. Any dividend or distribution paid prior
to the discovery by the Corporation that the shares of Class K Preferred Stock
have been transferred to the Trustee shall be repaid to the Corporation upon
demand, and any dividend or distribution declared but unpaid shall be rescinded
as void ab initio with respect to such shares of Class K Preferred Stock. Any
dividends or distributions so disgorged or rescinded shall be paid over to the
Trustee and held in trust for the Charitable Beneficiary. Any vote cast by a
Prohibited Transferee prior to the discovery by the Corporation that the shares
of Class K Preferred Stock have been transferred to the Trustee will be
rescinded as void ab initio and shall be recast in accordance with the desires
of the Trustee acting for the benefit of the Charitable Beneficiary. The owner
of the shares at the time of the Excess Transfer, change in capital structure or
other event giving rise to a potential violation of the Ownership Limit, Initial
Holder Limit or Look-Through Entity Ownership Limit shall be deemed to have
given an irrevocable proxy to the Trustee to vote the shares of Class K
Preferred Stock for the benefit of the Charitable Beneficiary.
(E) RESTRICTIONS ON TRANSFER. The Trustee of the Trust may
sell the shares held in the Trust to a Person, designated by the Trustee, whose
ownership of the shares will not violate the Ownership Restrictions. If such a
sale is made, the interest of the Charitable Beneficiary shall terminate and
proceeds of the sale shall be payable to the Prohibited Transferee and to the
Charitable Beneficiary as provided in this Section 11.3(E). The Prohibited
Transferee shall receive the lesser of (1) the price paid by the Prohibited
Transferee for the shares or, if the Prohibited Transferee did not give value
for the shares (through a gift, devise or other transaction), the Market Price
of the shares on the day of the event causing the shares to be held in the Trust
and (2) the price per share received by the Trustee from the sale or other
disposition of the shares held in the Trust. Any proceeds in excess of the
amount payable to the Prohibited Transferee shall be payable to the Charitable
Beneficiary. If any of the transfer restrictions set forth in this Section
11.3(E) or any application thereof is determined in a final judgment to be void,
invalid or unenforceable by any court having jurisdiction over the issue, the
Prohibited Transferee may be deemed, at the
27
<PAGE> 28
option of the Corporation, to have acted as the agent of the Corporation in
acquiring the Class K Preferred Stock as to which such restrictions would, by
their terms, apply, and to hold such Class K Preferred Stock on behalf of the
Corporation.
(F) PURCHASE RIGHT IN STOCK TRANSFERRED TO THE TRUSTEE. Shares of
Class K Preferred Stock transferred to the Trustee shall be deemed to have been
offered for sale to the Corporation, or its designee, at a price per share equal
to the lesser of (i) the price per share in the transaction that resulted in
such transfer to the Trust (or, in the case of a devise or gift, the Market
Price at the time of such devise or gift) and (ii) the Market Price on the date
the Corporation, or its designee, accepts such offer. The Corporation shall have
the right to accept such offer for a period of 90 days after the later of (i)
the date of the Excess Transfer or other event resulting in a transfer to the
Trust and (ii) the date that the Board of Directors determines in good faith
that an Excess Transfer or other event occurred.
(G) DESIGNATION OF CHARITABLE BENEFICIARIES. By written notice to
the Trustee, the Corporation shall designate one or more nonprofit organizations
to be the Charitable Beneficiary of the interest in the Trust relating to such
Prohibited Transferee if (i) the shares of Class K Preferred Stock held in the
Trust would not violate the Ownership Restrictions in the hands of such
Charitable Beneficiary and (ii) each Charitable Beneficiary is an organization
described in Sections 170(b)(1)(A), 170(c)(2) and 501(c)(3) of the Code.
11.4 NOTICE OF RESTRICTED TRANSFER. Any Person that acquires or
attempts to acquire shares of Class K Preferred Stock in violation of Section
11.1 of this Article, or any Person that is a Prohibited Transferee such that
stock is transferred to the Trustee under Section 11.3 of this Article, shall
immediately give written notice to the Corporation of such event and shall
provide to the Corporation such other information as the Corporation may request
in order to determine the effect, if any, of such Transfer or attempted Transfer
or other event on the Corporation's status as a REIT. Failure to give such
notice shall not limit the rights and remedies of the Board of Directors
provided herein in any way.
11.5 OWNERS REQUIRED TO PROVIDE INFORMATION. From and after the Issue
Date certain record and Beneficial Owners and transferees of shares of Class K
Preferred Stock will be required to provide certain information as set out
below.
(A) ANNUAL DISCLOSURE. Every record and Beneficial Owner of more
than 5% (or such other percentage between 0.5% and 5%, as provided in the
applicable regulations adopted under the Code) of the number of Outstanding
shares of Class K Preferred Stock shall, within 30 days after January 1 of each
year, give written notice to the Corporation stating the name and address of
such record or Beneficial Owner, the number of shares of Class K Preferred Stock
Beneficially Owned, and a full description of how such shares are held. Each
such record or Beneficial Owner of Class K Preferred Stock shall, upon demand by
the Corporation,
28
<PAGE> 29
disclose to the Corporation in writing such additional information with respect
to the Beneficial Ownership of the Class K Preferred Stock as the Board of
Directors, in its sole discretion, deems appropriate or necessary to (i) comply
with the provisions of the Code regarding the qualification of the Corporation
as a REIT under the Code and (ii) ensure compliance with the Ownership Limit,
the Initial Holder Limit or the Look- Through Ownership Limit, as applicable.
Each stockholder of record, including without limitation any Person that holds
shares of Class K Preferred Stock on behalf of a Beneficial Owner, shall take
all reasonable steps to obtain the written notice described in this Section 11.5
from the Beneficial Owner.
(B) DISCLOSURE AT THE REQUEST OF THE CORPORATION. Any Person that
is a Beneficial Owner of shares of Class K Preferred Stock and any Person
(including the stockholder of record) that is holding shares of Class K
Preferred Stock for a Beneficial Owner, and any proposed transferee of shares,
shall provide such information as the Corporation, in its sole discretion, may
request in order to determine the Corporation's status as a REIT, to comply with
the requirements of any taxing authority or other governmental agency, to
determine any such compliance or to ensure compliance with the Ownership Limit,
the Initial Holder Limit and the Look- Through Ownership Limit, and shall
provide a statement or affidavit to the Corporation setting forth the number of
shares of Class K Preferred Stock already Beneficially Owned by such stockholder
or proposed transferee and any related persons specified, which statement or
affidavit shall be in the form prescribed by the Corporation for that purpose.
11.6 REMEDIES NOT LIMITED. Nothing contained in this Article shall
limit the authority of the Board of Directors to take such other action as it
deems necessary or advisable (subject to the provisions of Section 11.12 of this
Article) (i) to protect the Corporation and the interests of its stockholders in
the preservation of the Corporation's status as a REIT and (ii) to insure
compliance with the Ownership Limit, the Initial Holder Limit and the
Look-Through Ownership Limit.
11.7 AMBIGUITY. In the case of an ambiguity in the application of any
of the provisions of Section 11 of this Article, or in the case of an ambiguity
in any definition contained in Section 11 of this Article, the Board of
Directors shall have the power to determine the application of the provisions of
this Article with respect to any situation based on its reasonable belief,
understanding or knowledge of the circumstances.
11.8 EXCEPTIONS. The following exceptions shall apply or may be
established with respect to the limitations of Section 11.1 of this Article.
(A) WAIVER OF OWNERSHIP LIMIT. The Board of Directors, upon
receipt of a ruling from the Internal Revenue Service or an opinion of tax
counsel or other evidence or undertaking acceptable to it, may waive the
application, in whole or in part, of the Ownership Limit to a Person subject to
the Ownership Limit, if such person is not an individual for purposes of Section
542(a) of the Code and is a
29
<PAGE> 30
corporation, partnership, estate or trust. In connection with any such
exemption, the Board of Directors may require such representations and
undertakings from such Person and may impose such other conditions as the Board
of Directors deems necessary, in its sole discretion, to determine the effect,
if any, of the proposed Transfer on the Corporation's status as a REIT.
(B) PLEDGE BY INITIAL HOLDER. Notwithstanding any other provision
of this Article, the pledge by the Initial Holder of all or any portion of the
Class K Preferred Stock directly owned at any time or from time to time shall
not constitute a violation of Section 11.1 of this Article and the pledgee shall
not be subject to the Ownership Limit with respect to the Class K Preferred
Stock so pledged to it either as a result of the pledge or upon foreclosure.
(C) UNDERWRITERS. For a period of 270 days (or such longer period
of time as any underwriter described below shall hold an unsold allotment of
Class K Preferred Stock) following the purchase of Class K Preferred Stock by an
underwriter that (i) is a corporation, partnership or other legal entity and
(ii) participates in an offering of the Class K Preferred Stock, such
underwriter shall not be subject to the Ownership Limit with respect to the
Class K Preferred Stock purchased by it as a part of or in connection with such
offering and with respect to any Class K Preferred Stock purchased in connection
with market making activities.
11.9 LEGEND. Each certificate for Class K Preferred Stock shall bear
substantially the following legend:
"The shares of Class K Convertible Cumulative Preferred Stock
represented by this certificate are subject to restrictions on
transfer. No person may Beneficially Own shares of Class K Convertible
Cumulative Preferred Stock in excess of the Ownership Restrictions, as
applicable, with certain further restrictions and exceptions set forth
in the Charter (including the Articles Supplementary setting forth the
terms of the Class K Convertible Cumulative Preferred Stock). Any
Person that attempts to Beneficially Own shares of Class K Convertible
Cumulative Preferred Stock in excess of the applicable limitation must
immediately notify the Corporation. All capitalized terms in this
legend have the meanings ascribed to such terms in the Charter
(including the Articles Supplementary setting forth the terms of the
Class K Convertible Cumulative Preferred Stock), as the same may be
amended from time to time, a copy of which, including the restrictions
on transfer, will be sent without charge to each stockholder that so
requests. If the restrictions on transfer are violated (i) the transfer
of the shares of Class K Convertible Cumulative Preferred Stock
represented hereby will be void in accordance with the Charter
(including the Articles Supplementary setting forth the terms of the
Class K Convertible Cumulative
30
<PAGE> 31
Preferred Stock) or (ii) the shares of Class K Convertible Cumulative
Preferred Stock represented hereby will automatically be transferred
to a Trustee of a Trust for the benefit of one or more Charitable
Beneficiaries."
11.10 SEVERABILITY. If any provision of this Article or any application
of any such provision is determined in a final and unappealable judgment to be
void, invalid or unenforceable by any Federal or state court having jurisdiction
over the issues, the validity and enforceability of the remaining provisions
shall not be affected and other applications of such provision shall be affected
only to the extent necessary to comply with the determination of such court.
11.11 BOARD OF DIRECTORS DISCRETION. Anything in this Article to the
contrary notwithstanding, the Board of Directors shall be entitled to take or
omit to take such actions as it in its discretion shall determine to be
advisable in order that the Corporation maintain its status as and continue to
qualify as a REIT, including, but not limited to, reducing the Ownership Limit,
the Initial Holder Limit and the Look- Through Ownership Limit in the event of a
change in law.
11.12 SETTLEMENT. Nothing in this Section 11 of this Article shall be
interpreted to preclude the settlement of any transaction entered into through
the facilities of the NYSE or other securities exchange or an automated
inter-dealer quotation system.
FOURTH: The terms of the Class K Cumulative Preferred Stock set forth
in Article Third hereof shall become Article XXI of the Charter.
31
<PAGE> 32
IN WITNESS WHEREOF, the Corporation has caused these presents to be
signed in its name and on its behalf by its Senior Vice President and Chief
Financial Officer and witnessed by its Assistant Secretary on February __, 1999.
WITNESS: APARTMENT INVESTMENT AND
MANAGEMENT COMPANY
/s/ Lucy Cordova /s/ Troy D. Butts
- ------------------------------- --------------------------------
Lucy Cordova Troy D. Butts
Assistant Secretary Senior Vice President and
Chief Financial Officer
THE UNDERSIGNED, Senior Vice President and Chief Financial Officer of
APARTMENT INVESTMENT AND MANAGEMENT COMPANY, who executed on behalf of the
Corporation the Articles Supplementary of which this Certificate is made a part,
hereby acknowledges in the name and on behalf of said Corporation the foregoing
Articles Supplementary to be the corporate act of said Corporation and hereby
certifies that the matters and facts set forth herein with respect to the
authorization and approval thereof are true in all material respects under the
penalties of perjury.
/s/ Troy D. Butts
--------------------------------
Troy D. Butts
Senior Vice President and
Chief Financial Officer
<PAGE> 1
EXHIBIT 3.4
Form of the Registrant's Class K Preferred Stock Certificate.
[front of Certificate]
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
Incorporated under the laws of the state of Maryland
Number_______________
_________________ Shares
<TABLE>
<S> <C>
Class K Convertible Cumulative Preferred Stock See reverse for certain definitions
This certificate is transferable in
Boston, MA or New York, NY CUSIP 03748R705
Countersigned and registered
BankBoston, N.A.
-------------------------------------
(Signature)
</TABLE>
This certifies that _______________is the owner of ______________fully-paid and
non-assessable shares of Class K Convertible Cumulative Preferred Stock, $.01
par value per share, of Apartment Investment and Management Company transferable
only on the books of the Corporation by the holder hereof in person or by duly
authorized attorney upon surrender of this Certificate properly endorsed. This
Certificate is not valid unless countersigned by the Transfer Agent and
registered by the Registrar.
Witness the facsimile seal of the Corporation and the facsimile signatures
of its duly authorized officers.
Dated /s/ Terry Considine
----------- ----------------------------------
Terry Considine
Chief Executive Officer
/s/ Joel Bonder /s/ Peter Kompaniez
- ------------------------------- ----------------------------------
Joel Bonder Peter Kompaniez
Secretary President
<PAGE> 2
[back of Certificate]
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
This certificate and the shares represented thereby shall be held subject
to all of the provisions of the Articles of Restatement, as amended, and the
By-Laws of Apartment Investment and Management Company (the "Corporation"), a
copy of each of which is on file at the office of the Corporation, and made a
part hereof as fully as though the provisions of said Articles of Restatement
and By-Laws were imprinted in full on this certificate, to all of which the
holder of this certificate, by acceptance hereof, assents and agrees to be
bound.
Any shareholder may obtain from the principal office of the Corporation,
upon request and without charge, a statement of the number of shares
constituting each class or series of stock and the designation thereof; and a
copy of the rights, preferences, privileges, and restrictions granted to or
imposed upon the respective classes or series of stock and upon the holders
thereof by said Articles of Restatement and the By-Laws. The shares represented
hereby are convertible into shares of Class A Common Stock, par value $.01 per
share, of the Corporation at the option of the holder hereof.
The Corporation will furnish to any stockholder on request and without
charge a full statement of the designations and any preferences, conversion and
other rights, voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemption of the stock of each
class which the Corporation is authorized to issue, of the differences in the
relative rights and preferences between the shares of each series of a preferred
or special class in series which the Corporation is authorized to issue, to the
extent they have been set, and of the authority of the Board of Directors to set
the relative rights and preferences of subsequent series of a preferred or
special class of stock. Such request may be made to the secretary of the
Corporation or to its transfer agent.
The shares of Class K Convertible Cumulative Preferred Stock represented
by this certificate are subject to restrictions on transfer. No person may
Beneficially Own shares of Class K Convertible Cumulative Preferred Stock in
excess of the Ownership Restrictions, as applicable, with certain further
restrictions and exceptions set forth in the Charter (including the Articles
Supplementary setting forth the terms of the Class K Convertible Cumulative
Preferred Stock). Any Person that attempts to Beneficially Own shares of Class K
Convertible Cumulative Preferred Stock in excess of the applicable limitation
must immediately notify the Corporation. All capitalized terms in this legend
have the meanings ascribed to such terms in the Charter (including the Articles
Supplementary setting forth the terms of the Class K Convertible Cumulative
Preferred Stock), as the same may be amended from time to time, a copy of which,
including the restrictions on transfer, will be sent without charge to each
stockholder that so requests. If the restrictions on transfer are violated (i)
the transfer of the shares of Class K Convertible Cumulative Preferred Stock
represented hereby will be void in accordance with the Charter (including the
Articles Supplementary setting forth the terms of the Class K Convertible
Cumulative Preferred Stock) or (ii) the shares of Class K Convertible Cumulative
Preferred Stock represented hereby will automatically be transferred to a
Trustee of a Trust for the benefit of one or more Charitable Beneficiaries.
<PAGE> 3
The following abbreviations, when used in the inscription on the face of
this Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
<TABLE>
<S> <C> <C>
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
----------------- -----------------
TEN ENT - as tenants by the entireties Under Uniform Gifts to Minors
Act
-----------------------------------
JT TEN - as joint tenants with right of (State)
survivorship and not as tenants
in common
</TABLE>
Additional abbreviations may also be used though not in the above list.
For Value received _______________ hereby sell, assign and transfer unto
____________ PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE (NAME AND ADDRESS OF TRANSFEREE SHOULD BE PRINTED OR TYPEWRITTEN)
______________Shares of the Class K Convertible Cumulative Preferred Stock
represented by the within Certificate and do hereby irrevocably constitute and
appoint______________ Attorney to transfer the said stock on the books of the
within-named Corporation with full power of substitution in the promises.
Dated: SIGNATURE
--------------------- ------------------------------
SIGNATURE(S) GUARANTEED
NOTICE: THE SIGNATURE OF THIS ASSIGNMENT MUST CORRESPOND WITH NAME(S) AS WRITTEN
UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION OR
ENLARGEMENT OR ANY CHANGE WHATEVER.
By:
------------------------
THE SIGNATURE SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION,(Banks,
Stockbrokers, Savings and Loan Associations and Credit Unions) WITH MEMBERSHIP
IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM PURSUANT TO SEC RULE
17Ad-15.
CONVERSION FORM
(To be executed only upon conversion of Class K
Convertible Cumulative Preferred Stock)
To: Apartment Investment and Management Company
The undersigned registered holder of the within shares of Class K
Convertible Cumulative Preferred Stock hereby irrevocably converts such shares
into ___________ shares of Class A Common Stock of Apartment Investment and
Management Company pursuant to the terms of the
<PAGE> 4
Class K Convertible Cumulative Preferred Stock, and requests that the
certificates for such shares be issued
in the name of
----------------------------------------------------------------
and delivered to
--------------------------------------------------------------
whose address is
--------------------------------------------------------------
Dated:
----------------- -----------------------------------------------
Signature must conform in all respects to name
of holder as specified on the face of the
Class K Convertible Cumulative Preferred Share
certificate
Signed in the presence of:
-----------------------------------------------
(Street address)
- ------------------------- -----------------------------------------------
City State Zip Code
