SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the registrant X
Filed by a party other than the registrant
Check the appropriate box:
|X| Preliminary proxy statement
|_| Definitive proxy statement
|_| Definitive additional materials
|_| Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
GLENBOROUGH REALTY TRUST INCORPORATED
(Name of Registrant as Specified in Its Charter)
GLENBOROUGH REALTY TRUST INCORPORATED
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(2)
and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transactions applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:1
(4) Proposed maximum aggregate value of transaction:
(5) Total Fee paid:
|_| Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the filing by registration statement number, or the form or
schedule and the date of its filing.
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GLENBOROUGH REALTY TRUST INCORPORATED
Notice of Special Meeting of Stockholders to be held February 4, 1998
_____________
A Special Meeting of Stockholders of Glenborough Realty Trust Incorporated,
a Maryland corporation (the "Company") will be held at the Company's corporate
headquarters at 400 South El Camino Real, Suite 1100, San Mateo, California
94402-1708, on Wednesday, February 4, 1998, at 9:30 A.M., Pacific Time, for the
purpose of considering and acting upon the following:
1. Approval of an amendment to the Company's Certificate of
Incorporation to increase the number of shares of Common
Stock which the Company is authorized to issue from 50,000,000
to 200,000,000.
2. Any and all matters incident to the foregoing, and such
other business as may legally come before the meeting and
any adjournments or postponements thereof.
The Board of Directors has fixed the close of business on December 17, 1997
as the record date for determining the stockholders having the right to notice
of and to vote at the special meeting.
By order of the Board of Directors
/s/Frank E. Austin
Frank E. Austin
Secretary
San Mateo, California
January , 1998
- - --------------------------------------------------------------------------------
IMPORTANT: Every stockholder whether not he or she expects to attend the Special
Meeting in person, is urged to execute the proxy and return it promptly in the
enclosed business reply envelope.
- - --------------------------------------------------------------------------------
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GLENBOROUGH REALTY TRUST INCORPORATED
____________________________________________
PROXY STATEMENT
For a Special Meeting of Stockholders
To Be Held February 4, 1998
____________________________________________
Proxies in the form enclosed with this Proxy Statement are solicited by the
Board of Directors of Glenborough Realty Trust Incorporated (the "Company") to
be used at a Special Meeting of Stockholders (the "Special Meeting") to be held
at 9:30 A.M. Pacific Time on February 4, 1998, for the purpose set forth in the
Notice of Meeting and this Proxy Statement. This Proxy Statement and the
accompanying proxy were mailed to stockholders on or about January 5, 1998.
VOTING, VOTE REQUIRED AND REVOCATION
Each stockholder is entitled to one vote for each share of Common Stock
owned. Approval of the proposed amendment (the "Amendment") to the Articles of
Amendment of Restatement of Articles of Incorporation (the "Articles of
Incorporation") requires the affirmative vote of a majority of all outstanding
shares of stock of the Company ("Stock"). Stockholders of record at the close of
business on December 17, 1997 (the "Record Date") are entitled to notice of and
to vote at the Special Meeting. At the Record Date, 31,490,817 shares of Common
Stock were issued and outstanding, and no other shares of the Company's capital
stock were outstanding.
All shares represented by valid proxies will be voted in accordance with
the instructions contained therein. In the absence of instructions, proxies will
be voted FOR the Amendment. Shares of Common Stock represented by proxies which
are marked "ABSTAIN" with respect to the Amendment will have the effect of a
vote against the Amendment. In instances where brokers are prohibited from
exercising discretionary authority for beneficial owners who have not returned
proxies (so called "broker non-votes"), those shares will be disregarded and
will have the effect of a vote against the Amendment.
A proxy may be revoked by the stockholder giving the proxy at any time
before it is voted by written notice of revocation delivered to the Company (to
the attention of Janet F. Nelson), and a prior proxy is automatically revoked by
a stockholder giving a subsequent proxy or attending and voting at the meeting.
Attendance at the meeting in and of itself does not revoke a prior proxy.
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PROPOSAL
AMENDMENT TO THE CERTIFICATE OF INCORPORATION
TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
In October 1997, the Board of Directors declared advisable and unanimously
approved the Amendment to increase the aggregate number of shares of Stock which
the Company is authorized to issue from 50,000,000 to 200,000,000.
If approved by the stockholders, the Amendment will become effective upon
the filing of Articles of Amendment with the State Department of Assessments and
Taxation of Maryland. The Amendment would change paragraph (a) of Article 6 of
the Company's Articles of Incorporation to read in its entirety as follows:
"SIXTH: (a) the total number of shares of stock of all
classes ("Capital Stock") which the Corporation has
authority to issue is 200,000,000 shares (par value $.001
per share), all of which 200,000,000 shares are initially
classified as shares of common stock ("Common Stock"). The
aggregate par value of the shares of all classes which the
Corporation has authority to issue is $200,000.00. The Board
of Directors may classify or reclassify any unissued shares
of stock by setting or changing in any one or more respects,
the preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends or other
distributions, qualifications or terms or conditions of
redemption of such shares of stock."
Purpose and Effect of the Amendment
The principal purpose of the proposed Amendment is to authorize additional
shares of Common Stock which will be available when the Board of Directors
determines that it is necessary or appropriate to raise additional capital
through the sale of securities, to acquire another company or its business or
assets through the issuance of securities, or to effect future stock dividends
or stock splits.
Since the Company began operations in January 1996, it has pursued an
aggressive growth strategy funded primarily with the proceeds from the issuance
of shares of Common Stock. As a result, the total number of shares issued and
outstanding has increased from 6,296,042 to 36,625,678 (including shares
reserved for issuance in connection with the redemption of partnership units of
Glenborough Properties, L.P. and the exercise of stock options granted or which
may be granted pursuant to the Company's 1996 Stock Incentive Plan), an increase
of approximately 582%. During the same period, from January 31, 1996 (the first
day the Common Stock began trading on the New York Stock Exchange) to the Record
Date, the per share market price of the Common Stock as reported on the New York
Stock Exchange has increased from $12.00 to $27.50, respectively. Thus, the
Company's growth strategy and the issuance of additional shares has historically
been beneficial to the Company's shareholders. In order for the company to
sustain its desired level of growth, it needs the ability to issue a substantial
number of new shares within the near future, more than are currently available
under the Company's charter. This is the reason for the proposed Charter
Amendment.
As of the Record Date, of the Company's 50,000,000 authorized shares of
Common Stock, only approximately 13,374,322 shares of Common Stock remain
available. In order for the Company to continue implementing its growth
strategy, a substantial number of additional shares of Common Stock
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<PAGE>
available for issuance are needed. The purpose of the proposed Amendment is to
make available such additional shares.
If the proposed Amendment is adopted, the aggregate number of authorized
shares of Common Stock will be increased from 50,000,000 to 200,000,000, and
approximately 163,374,322 additional shares of Common Stock will be available
for issuance by the Board of Directors without any further stockholder approval,
except in certain issuances of shares which require stockholder approval in
accordance with the requirements of the New York Stock Exchange. Adoption of the
proposed Amendment without further action of the Board of Directors will not
result in the issuance of additional shares of Common Stock.
The holders of shares of Common Stock do not presently have preemptive
rights to subscribe from the additional shares proposed to be authorized. The
additional shares might be issued at such times and under such circumstances as
to have a dilutive effect on earnings per share and on the equity ownership of
the present holders of Common Stock.
Potential Anti-Takeover Effect
The Proposed Amendment could, under certain circumstances, have an
anti-takeover effect, although this is not the intention of the proposal. The
increased number of authorized shares of Common Stock could discourage, or be
used to impede, an attempt to acquire or otherwise change control of the
Company. The private placement of shares of Common Stock into "friendly" hands,
for example, could dilute the voting strength of a party seeking control of the
Company. Furthermore, many companies have issued warrants or other rights to
acquire additional shares of common stock to the holders of its common stock to
discourage or defeat unsolicited share accumulation programs and acquisition
proposals, which programs or proposals may be viewed by the board of directors
as not in the best interest of the company and its shareholders. Although the
Company has no present intent to use the additional authorized shares of Common
Stock for such purposes, if this Proposal is adopted, more capital stock of the
Company would be available for such purposes than is currently available.
The Board of Directors unanimously recommends a vote FOR the Amendment.
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information known to the Company regarding
beneficial ownership of shares of Common Stock as of the Record Date by (i) each
director and each of the executive officers named in the table below, (ii) all
directors and executive officers as a group, and (iii) each person known by the
Company to beneficially own more than 5% of the Company's Common Stock.
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<TABLE>
<CAPTION>
Percentage of Shares
Outstanding and
Name and Address Amount and Nature of Percentage of Operating Partnership
Address of Beneficial Owner Beneficial Ownership(1) Shares Outstanding(2) Interests (3)
<S> <C> <C> <C>
Robert Batinovich (4) (5) 1,302,188 4.1% 3.8%
Andrew Batinovich (4) (6) 306,626 1.0% 0.9%
Sandra L. Boyle (4) (7) 5,372 * *
Stephen R. Saul (4) 3,150 * *
Frank E. Austin (4) (8) 8,321 * *
Terri Garnick (4) 5,750 * *
Anna Cheng (4) 100 * *
Alan Shapiro (4) 300 * *
Patrick Foley (9) 21,942 * *
Richard A. Magnuson (10) 7,000 * *
Laura Wallace (11) 8,023 * *
All directors and executive officers as a
group (11 persons) (12) 1,668,772 5.3% 4.9%
______________
* less than 1%
<FN>
(1) Certain of the officers hold or control, in the aggregate, limited
partnership interests representing approximately 21.0% of Glenborough
Partners, a California limited partnership ("Partners"). In turn, Partners
is a 99% limited partner of GPA, Ltd., a California limited partnership
("GPA"), which holds approximately a 2.2% interest in Glenborough
Properties, L.P., a California limited partnership (the "Operating
Partnership"), in which the Company has a 1% general partnership interest
and approximately a 91.3% limited partnership interest. Such officers,
through their interest in Partners, share indirectly, with the Company, in
the net income or loss and any distributions of the Operating Partnership.
Pursuant to the partnership agreement of the Operating Partnership, GPA
holds certain redemption rights under which its interest in the Operating
Partnership could at some point be redeemed in exchange for shares of the
Company's Common Stock.
(2) Assumes conversion of only the limited partnership interests in the
Operating Partnership owned by such owner indirectly (through its interest
in Partners and Partners' interest in GPA) or directly into shares of the
Company's Common Stock. The total number of shares outstanding used in
calculating this percentage assumes that none of the other limited
partnership interests are converted into shares of the Company's Common
Stock.
(3) Assumes conversion of all outstanding limited partnership interests in
the Operating Partnership (other than the limited partnership interests
owned by the Company) into shares of the Company's Common Stock.
(4) The business address of such person is 400 South El Camino Real, Suite
1100, San Mateo, California 94402-1708.
(5) Includes 69,166 shares of the Company's Common Stock that may be issued
upon redemption of Robert Batinovich's interest in the Operating
Partnership. Includes 137,580 shares of the Company's Common
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Stock that may be issued upon the redemption of GPA's interest in the
Operating Partnership, which represents Robert Batinovich's portion of all
shares of the Company's Common Stock that may be issued to GPA upon such
redemption. Includes 16,007 shares of the Company's Common Stock, which
represents Robert Batinovich's portion of all shares of the Company's
Common Stock that is directly owned by GPA. Excludes 54,627 shares of the
Company's Common Stock held by S.S. Rainbow, a California limited
partnership ("S.S. Rainbow") in which Robert Batinovich's adult son, Andrew
Batinovich, is general partner, and his daughter, Angela Batinovich, is a
limited partner, which represents Angela Batinovich's portion of all shares
of the Company's Common Stock held by S.S. Rainbow. Also excludes (i) 2,549
shares of the Company's Common Stock that may be issued upon the redemption
of GPA's interest in the Operating Partnership, which represents Angela
Batinovich's portion of all shares of the Company's Common Stock that may
be issued to GPA upon such redemption, (ii) 297 shares of the Company's
Common Stock, which represents Angela Batinovich's portion of all shares of
the Company's Common Stock that is directly owned by GPA and (iii) 1,300
shares of the Company's Common Stock, both of which are held by a trust as
to which Angela Batinovich is sole beneficiary and an independent third
party is trustee.
(6) Includes 5,712 shares of the Company's Common Stock that may be issued
upon the redemption of GPA's interest in the Operating Partnership, which
represents Andrew Batinovich's portion of all shares of the Company's
Common Stock that may be issued to GPA upon such redemption. Includes 665
shares of the Company's Common Stock which represents Andrew Batinovich's
portion of all shares of the Company's Common Stock that is directly owned
by GPA. Also includes 110,357 shares of the Company's Common Stock held by
S.S. Rainbow in which Andrew Batinovich is sole general partner and his
sister, Angela Batinovich, is a limited partner. Of the total shares held
by S.S. Rainbow, Andrew Batinovich's pro rata portion is 55,730 shares and
Angela Batinovich's pro rata portion is 54,627. Angela Batinovich's 54,627
shares (beneficially owned through her interest in S.S. Rainbow) are not
attributed to Robert Batinovich (her father), but only to Andrew Batinovich
(the general partner of S.S. Rainbow) for purposes of this table.
(7) Includes 333 shares of the Company's Common Stock that may be issued
upon the redemption of GPA's interest in the Operating Partnership, which
represents Sandra L. Boyle's portion of all shares of the Company's Common
Stock that may be issued to GPA upon such redemption. Includes 39 shares of
the Company's Common Stock, which represents Sandra L. Boyle's portion of
all shares of the Company's Common Stock that is directly owned by GPA.
(8) Includes 466 shares of the Company's Common Stock that may be issued
upon the redemption of GPA's interest in the Operating Partnership, which
represents Frank E. Austin's portion of all shares of the Company's Common
Stock that may be issued to GPA upon such redemption. Includes 54 shares of
the Company's Common Stock, which represents Frank E. Austin's portion of
all shares of the Company's Common Stock that is directly owned by GPA.
(9) The business address of such person is DHL Airways, Inc., 333 Twin
Dolphin Drive, Redwood City, CA 94065.
(10) The business address of such person is 9744 Wilshire Blvd., Suite 302,
Beverly Hills, CA 90212.
(11) The business address of such person is Public Employees Retirement
System of Nevada, 693 West Nye Lane, Carson City, NV 89703.
(12) Includes 213,257 shares of the Company's Common Stock that may be
issued upon the redemption of Mr. Batinovich's and GPA's interest in the
Operating Partnership, which includes all officers' and directors'
aggregate portion of all shares of the Company's Common Stock that may be
issued to GPA upon such redemption.
</FN>
</TABLE>
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MISCELLANEOUS
Other Matters
Management knows of no matters other than the foregoing to be brought
before the Special Meeting. If such other matters properly come before the
meeting, or any adjournment thereof, the proxies named in the accompanying form
of proxy will vote such proxy on such matters in accordance with their best
judgment.
Solicitation of Proxies
The entire cost of solicitation of proxies will be borne by the Company.
The Company may retain a proxy solicitor to solicit proxies and expects the fee
paid to such firm would be approximately $4,500. In addition, proxies may be
solicited by directors, officers and regular employees of the Company, without
extra compensation by telephone, telegraph, mail or personal interview. The
Company will also reimburse brokerage houses and other custodians, nominees and
fiduciaries for their reasonable expenses for sending proxies and proxy material
to the beneficial owners of its Common Stock.
EVERY STOCKHOLDER, WHETHER OR NOT HE OR SHE EXPECTS TO ATTEND THE SPECIAL
MEETING IN PERSON, IS URGED TO EXECUTE THE PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED BUSINESS REPLY ENVELOPE.
By order of the Board of Directors
/s/ Frank E. Austin
Frank E. Austin
Secretary
San Mateo, California
January , 1998
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[FORM OF FRONT OF PROXY CARD]
PROXY
GLENBOROUGH REALTY TRUST INCORPORATED
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS
FOR THE SPECIAL MEETING ON FEBRUARY 4, 1998.
The undersigned hereby appoints Andrew
Batinovich and Frank E. Austin and each of them,
with full power of substitution, the attorneys and
proxies of the undersigned to attend the Special
Meeting of Stockholders of Glenborough Realty
Trust Incorporated to be held on February 4, 1998
at 9:30 a.m. Pacific Time and at any
postponement(s) thereof to vote all shares of
Common Stock of the Company held or owned by the
undersigned as indicated on the proposal as more
fully set forth in the Proxy Statement, and in
their discretion upon such other matters as may
come before the meeting.
___________________________________________________
PROPOSAL
The approval of the amendment to the Articles
of Incorporation.
|_| FOR |_| WITHHELD |_| ABSTAIN
The shares represented by this proxy will be
voted as directed or if no direction is indicated,
will be voted FOR the proposal.
The undersigned hereby acknowledges receipt
of the Notice of, and Proxy Statement for, the
aforesaid Special Meeting.
Date: , 1998
Signature of Stockholder:
DATE AND SIGN EXACTLY AS NAME APPEARS HEREON. EACH
JOINT TENANT MUST SIGN. WHEN SIGNING AS ATTORNEY,
EXECUTOR, TRUSTEE, ETC., GIVE FULL TITLE. IF
SIGNER IS A CORPORATION, SIGN IN FULL CORPORATE
NAME BY AUTHORIZED OFFICER.
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