CERTIFICATE OF DETERMINATION OF PREFERENCES
OF
8.45% CUMULATIVE PREFERRED STOCK, SERIES H
OF
PUBLIC STORAGE, INC.
------------------------
[As Filed in the Office of the Secretary of State
of the State of California January 24, 1996]
The undersigned, Harvey Lenkin and Sarah Hass, President
and Secretary, respectively, of PUBLIC STORAGE, INC., a California
corporation, do hereby certify:
FIRST: The Restated Articles of Incorporation of the
Corporation authorize the issuance of 50,000,000 shares of stock
designated "preferred shares," issuable from time to time in one or
more series, and authorize the Board of Directors to fix the number
of shares constituting any such series, and to determine or alter the
dividend rights, dividend rate, conversion rights, voting rights, right
and terms of redemption (including sinking fund provisions), the
redemption price or prices and the liquidation preference of any wholly
unissued series of such preferred shares, and the number of shares
constituting any such series.
SECOND: The Board of Directors of the corporation did duly
adopt the resolutions attached hereto as Exhibit A and incorporated
herein by reference authorizing and providing for the creation of a
series of preferred shares to be known as "8.45% Cumulative Preferred
Stock, Series H" consisting of 6,900 shares, none of the shares of such
series having been issued.
We further declare under penalty of perjury under the laws of
the State of California that the matters set forth in this certificate
are true and correct of our own knowledge.
IN WITNESS WHEREOF, the undersigned have executed this
certificate this 22nd day of January, 1996.
/S/ HARVEY LENKIN
-----------------------------
Harvey Lenkin
President
/S/ SARAH HASS
-----------------------------
Sarah Hass
Secretary
EXHIBIT A
RESOLUTION OF THE BOARD OF DIRECTORS
OF PUBLIC STORAGE, INC.
ESTABLISHING A SERIES OF 8.45% CUMULATIVE
PREFERRED STOCK, SERIES H
RESOLVED, that pursuant to the authority conferred upon
the Board of Directors by Article III of the Restated Articles of
Incorporation of this Corporation, there is hereby established a
series of the authorized preferred shares of this Corporation having
a par value of $.01 per share, which series shall be designated "8.45%
Cumulative Preferred Stock, Series H," shall consist of 6,900 shares
and shall have the following rights, preferences and privileges:
(a) Dividend Rights.
(1) Dividends shall be payable in cash on the shares of this
Series when, as and if declared by the Board of Directors, out of funds
legally available therefor: (i) for the period (the "Initial Dividend
Period") from the Deemed Original Issue Date (as defined below) to but
excluding April 1, 1996, and (ii) for each quarterly dividend period
thereafter (the Initial Dividend Period and each quarterly dividend
period being hereinafter individually referred to as a "Dividend
Period" and collectively referred to as "Dividend Periods"), which
quarterly Dividend Periods shall be in four equal amounts and shall
commence on January 1, April 1, July 1 and October 1 in each year
(each, a "Dividend Period Commencement Date"), commencing on April 1,
1996, and shall end on and include the day next preceding the next
Dividend Period Commencement Date, at a rate per annum equal to 8.45%
of the $25,000 per share stated value thereof (the "Dividend Rate").
Dividends on each share of this Series shall be cumulative from the
Deemed Original Issue Date of such share and shall be payable, without
interest thereon, when, as and if declared by the Board of Directors,
on or before March 31, June 30, September 30 and December 31 of each
year, commencing on March 31, 1996 or, in the case of shares of this
Series with a Deemed Original Issue Date after March 31, 1996, the
first such dividend payment date following such Deemed Original Issue
Date; provided, that if any such day shall be a Saturday, Sunday, or a
day on which banking institutions in the State of New York or the State
of California are authorized or obligated by law to close, or a day
which is or is declared a national or a New York or California state
holiday (any of the foregoing a "Non-Business Day"), then the payment
date shall be the next succeeding day which is not a Non-Business Day.
Each such dividend shall be paid to the holders of record of shares of
this Series as they appear on the stock register of the Corporation on
such record date, not more than 45 days nor less than 15 days preceding
the payment date thereof, as shall be fixed by the Board of Directors.
Dividends on account of arrears 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, not more
than 45 days nor less than 15 days preceding the payment date thereof,
as may be fixed by the Board of Directors. After full cumulative
dividends on this Series have been paid or declared and funds therefor
set aside for payment, including for the then current Dividend Period,
the holders of shares of this Series will not be entitled to any
further dividends with respect to that Dividend Period.
"Deemed Original Issue Date" means (a) in the case of any
share which is part of the first issuance of shares of this Series or
part of a subsequent issuance of shares of this Series prior to April
1, 1996, the date of such first issuance or subsequent issuance, as
the case may be, and (b) in the case of any share which is part of a
subsequent issuance of shares of this Series on or after April 1, 1996,
the later of (x) April 1, 1996 and (y) the latest Dividend Period
Commencement Date which precedes the date of issuance of such share
and which succeeds the last Dividend Period for which full cumulative
dividends have been paid; provided that, in the case of any share which
is part of a subsequent issuance, the date of issuance of which falls
between (i) the record date for dividends payable on the first
succeeding dividend payment date and (ii) such dividend payment date,
the "Deemed Original Issue Date" means the date of the Dividend Period
Commencement Date that immediately follows the date of issuance.
(2) Dividends payable on shares of this Series for any
period greater or less than a full Dividend Period, including the
Initial Dividend Period, shall be computed on the basis of a 360-day
year consisting of twelve 30-day months.
(3) The Corporation shall not declare or pay or set apart
for payment any dividends on any series of preferred shares ranking, as
to dividends, on a parity with or junior to the shares of this Series
unless full cumulative dividends have been or contemporaneously are
declared and paid, or declared and a sum sufficient for payment thereof
is set apart for payment, for all Dividend Periods terminating on or
prior to the date of payment of any such dividends on such other series
of preferred shares. When dividends are not paid in full upon the
shares of this Series and any other series of preferred shares ranking
on a parity therewith as to dividends (including, without limitation,
the shares of the Corporation's 10% Cumulative Preferred Stock, Series
A (the "Series A Preferred Stock"), 9.20% Cumulative Preferred Stock,
Series B (the "Series B Preferred Stock"), 9.50% Cumulative Preferred
Stock, Series D (the "Series D Preferred Stock"), 10% Cumulative
Preferred Stock, Series E (the "Series E Preferred Stock"), 9.75%
Cumulative Preferred Stock, Series F (the "Series F Preferred Stock"),
8-7/8% Cumulative Preferred Stock, Series G (the "Series G Preferred
Stock"),and Adjustable Rate Cumulative Preferred Stock, Series C (the
"Adjustable Rate Preferred Stock")), all dividends declared upon shares
of this Series and any other series of preferred shares ranking on a
parity therewith as to dividends shall be declared pro rata so that the
amount of dividends declared per share on the shares of this Series and
such other series of preferred shares shall in all cases bear to each
other that same ratio that the accumulated dividends per share on the
shares of this Series and such other series of preferred shares bear to
each other. Except as provided in the preceding sentence, unless full
cumulative dividends on the shares of this Series have been paid for
all past Dividend Periods, no dividends (other than in shares of the
Corporation's common stock, par value $.10 per share (together with any
other shares of capital stock of the Corporation into which such shares
shall be reclassified or changed ("Common Shares"), or another stock
ranking junior to the shares of this Series as to dividends and upon
liquidation) shall be declared or paid or set aside for payment nor
shall any other distribution be made upon the Common Shares or on any
other stock of the Corporation ranking junior to or on a parity with
the shares of this Series as to dividends or upon liquidation. Unless
full cumulative dividends on the shares of this Series have been paid
for all past Dividend Periods, no Common Shares or any other stock of
the Corporation ranking junior to or on a parity with the shares of
this Series as to dividends or upon liquidation shall be redeemed,
purchased, or otherwise acquired for any consideration (or any moneys
be paid to or made available for a sinking fund for the redemption of
any shares of any such stock) by the Corporation or any subsidiary,
except by conversion into or exchange for stock of the Corporation
ranking junior to the shares of this Series as to dividends and upon
liquidation.
(b) Liquidation.
In the event of any voluntary or involuntary liquidation,
dissolution, or winding up of the Corporation, the holders of shares
of this Series are entitled to receive out of the assets of the
Corporation available for distribution to shareholders, before any
distribution of assets is made to holders of Common Shares or any other
class or series of shares ranking junior to the shares of this Series
upon liquidation, liquidating distributions in the amount of $25,000
per share plus all accumulated and unpaid dividends (whether or not
earned or declared) for the then current and all past Dividend Periods.
If, upon any voluntary or involuntary liquidation, dissolution, or
winding up of the Corporation the amounts payable with respect to the
shares of this Series and any other shares of the Corporation ranking
as to any such distribution on a parity with the shares of this Series
are not paid in full, the holders of shares of this Series and of such
other shares (including the shares of Series A, Series B, Series D,
Series E, Series F and Series G Preferred Stock and Adjustable Rate
Preferred Stock) will share ratably in any such distribution of assets
of the Corporation in proportion to the full respective preferential
amounts to which they are entitled. After payment of the full amount of
the liquidating distribution to which they are entitled, the holders of
shares of this Series will not be entitled to any further participation
in any distribution of assets by the Corporation.
(1) Written notice of any such liquidation, dissolution or
winding up of the Corporation, stating the payment date or dates when,
and the place or places where the amounts distributable in such
circumstances shall be payable, shall be given by first class mail,
postage pre-paid, not less than 30 nor more than 60 days prior to the
payment date stated therein, to each record holder of the shares of
this Series at the respective addresses of such holders as the same
shall appear on the stock transfer records of the Corporation.
(2) For purposes of liquidation rights, a reorganization
(as defined in Section 181 of the California Corporations Code) or
consolidation or merger of the Corporation with or into any other
corporation or corporations or a sale of all or substantially all of
the assets of the Corporation shall be deemed not to be a liquidation,
dissolution or winding up of the Corporation.
(c) Redemption.
(1) Except as provided in clause (9) below, the shares of
this Series are not redeemable prior to January 31, 2001. On and
after such date, the shares of this Series are redeemable at the option
of the Corporation, by resolution of the Board of Directors, in whole
or in part, from time to time upon not less than 30 nor more than 60
days' notice, at a cash redemption price of $25,000 per share plus all
accumulated and unpaid dividends (whether or not earned or declared) to
the date of redemption.
(2) If fewer than all the outstanding shares of this Series
are to be redeemed, the number of shares to be redeemed will be
determined by the Board of Directors, and such shares shall be redeemed
pro rata from the holders of record of such shares in proportion to the
number of such shares held by such holders (with adjustments to avoid
redemption of fractional shares) or by lot in a manner determined by
the Board of Directors.
(3) Notwithstanding the foregoing, if any dividends,
including any accumulation, on the shares of this Series are in
arrears, no shares of this Series shall be redeemed unless all
outstanding shares of this Series are simultaneously redeemed, and
the Corporation shall not purchase or otherwise acquire, directly or
indirectly, any shares of this Series; provided, however, that the
foregoing shall not prevent the purchase or acquisition of shares of
this Series pursuant to a purchase or exchange offer provided such
offer is made on the same terms to all holders of shares of this
Series.
(4) Immediately prior to any redemption of shares of this
Series, the Corporation shall pay, in cash, any accumulated and unpaid
dividends through the redemption date, unless a redemption date falls
after a dividend payment record date and prior to the corresponding
dividend payment date, in which case each holder of shares of this
Series at the close of business on such dividend payment record date
shall be entitled to the dividend payable on such shares on the
corresponding dividend payment date notwithstanding the redemption of
such shares before such dividend payment date. Except as expressly
provided hereinabove, the Corporation shall make no payment or
allowance for unpaid dividends, whether or not in arrears, on shares
of this Series called for redemption.
(5) Notice of redemption shall be given by publication in a
newspaper of general circulation in the County of Los Angeles and The
City of New York, such publication to be made once a week for two
successive weeks, commencing not less than 30 nor more than 60 days
prior to the date fixed for redemption thereof. A similar notice will
be mailed by the Company by first class mail, postage pre-paid, to each
record holder of the shares of this Series to be redeemed, not less
than 30 nor more than 60 days prior to such redemption date, to the
respective addresses of such holders as the same shall appear on the
stock transfer records of the Corporation. Each notice shall state:
(i) the redemption date; (ii) the number of shares of this Series to be
redeemed; (iii) the redemption price; (iv) the place or places where
certificates for such shares are to be surrendered for payment of the
redemption price; and (v) that dividends on the shares to be redeemed
will cease to accumulate on such redemption date. If fewer than all
the shares of this Series held by any holder are to be redeemed, the
notice mailed to such holder shall also specify the number of shares of
this Series to be redeemed from such holder.
(6) In order to facilitate the redemption of shares of this
Series, the Board of Directors may fix a record date for the
determination of the shares to be redeemed, such record date to be not
less than 30 nor more than 60 days prior to the date fixed for such
redemption.
(7) Notice having been given as provided above, from and
after the date fixed for the redemption of shares of this Series by the
Corporation (unless the Corporation shall fail to make available the
money necessary to effect such redemption), the holders of shares
selected for redemption shall cease to be shareholders with respect
to such shares and shall have no interest in or claim against the
Corporation by virtue thereof and shall have no voting or other rights
with respect to such shares, except the right to receive the moneys
payable upon such redemption from the Corporation, less any required
tax withholding amount, without interest thereon, upon surrender (and
endorsement or assignment of transfer, if required by the Corporation
and so stated in the notice) of their certificates, and the shares
represented thereby shall no longer be deemed to be outstanding. If
fewer than all the shares represented by a certificate are redeemed, a
new certificate shall be issued, without cost to the holder thereof,
representing the unredeemed shares. The Corporation may, at its
option, at any time after a notice of redemption has been given,
deposit the redemption price for the shares of this Series designated
for redemption and not yet redeemed, plus any accumulated and unpaid
dividends thereon to the date fixed for redemption, with the transfer
agent or agents for this Series, as a trust fund for the benefit of
the holders of the shares of this Series designated for redemption,
together with irrevocable instructions and authority to such transfer
agent or agents that such funds be delivered upon redemption of such
shares and to pay, on and after the date fixed for redemption or prior
thereto, the redemption price of the shares to their respective holders
upon the surrender of their share certificates. From and after the
making of such deposit, the holders of the shares designated for
redemption shall cease to be shareholders with respect to such shares
and shall have no interest in or claim against the Corporation by
virtue thereof and shall have no voting or other rights with respect
to such shares, except the right to receive from such trust fund the
moneys payable upon such redemption, without interest thereon, upon
surrender (and endorsement, if required by the Corporation) of their
certificates, and the shares represented thereby shall no longer be
deemed to be outstanding. Any balance of such moneys remaining
unclaimed at the end of the five-year period commencing on the date
fixed for redemption shall be repaid to the Corporation upon its
request expressed in a resolution of its Board of Directors.
(8) Any shares of this Series that shall at any time have
been redeemed shall, after such redemption, have the status of
authorized but unissued preferred shares, without designation as
to series until such shares are once more designated as part of a
particular series by the Board of Directors.
(9) If the Board of Directors of the Corporation shall,
at any time and in good faith, be of the opinion that ownership of
securities of the Corporation has or may become concentrated to an
extent that may prevent the Corporation from qualifying as a real
estate investment trust under the REIT Provisions of the Internal
Revenue Code, then the Board of Directors shall have the power, by lot
or other means deemed equitable by them to prevent the transfer of
and/or to call for redemption a number of shares of this Series
sufficient, in the opinion of the Board of Directors, to maintain or
bring the direct or indirect ownership thereof into conformity with the
requirements of such a real estate investment trust under the REIT
Provisions of the Internal Revenue Code. The redemption price to be
paid for shares of this Series so called for redemption, on the date
fixed for redemption, shall be the average of the highest bid and
the lowest asked quotations on the last business day prior to the
redemption date as reported by the National Quotation Bureau,
Incorporated or a similar organization selected from time to time by
the Corporation or if there be no such bid and asked quotations, as
determined by the Board of Directors in good faith; provided that if
interests in shares of this Series are represented by depositary
shares, then the redemption price shall be determined in accordance
with the foregoing, but with respect to one depositary share,
multiplied by the number of depositary shares that together represent
an interest in one share of this Series. From and after the date fixed
for redemption by the Board of Directors, the holder of any shares of
this Series so called for redemption shall cease to be entitled to
any distributions, voting rights and other benefits with respect to
such shares of this Series, other than the right to payment of the
redemption price determined as aforesaid. "REIT Provisions of the
Internal Revenue Code" shall mean Sections 856 through 860 of the
Internal Revenue Code of 1986, as amended. In order to exercise the
redemption option set forth in this clause (9), with respect to the
shares of this Series, the Corporation shall give notice of redemption
by publication in a newspaper of general circulation in the County of
Los Angeles and The City of New York, such publication to be made once
a week for two successive weeks, commencing not less than 30 nor more
than 60 days prior to the date fixed for redemption. A similar notice
will be mailed by the Corporation by first class mail, postage prepaid,
to each record holder of the shares of this Series to be redeemed, not
less than 30 nor more than 60 days prior to such redemption date, to
the respective addresses of such holders as the same shall appear on
the stock transfer records of the Corporation. Each notice shall
state: (i) the redemption date; (ii) the number of shares of this
Series to be redeemed; (iii) the redemption price; (iv) the place or
places where certificates for such shares are to be surrendered for
payment of the redemption price; and (v) that dividends on the shares
to be redeemed will cease to accumulate on such redemption date. If
fewer than all the shares of this Series held by any holder are to be
redeemed, the notice mailed to such holder shall also specify the
number of shares of this Series to be redeemed from such holder.
(d) Maintenance of Debt Ratio. Without the affirmative vote
or the written consent of the holders of a majority of the shares of
this Series, the Corporation will not take any action that would result
in a ratio of Debt to Assets (the "Debt Ratio") in excess of 50%.
"Debt" means, as of any date of determination, all
liabilities that should, in accordance with GAAP, be reflected as a
liability on the consolidated balance sheet of the Corporation as of
such date of determination; provided, however, that "Debt" shall not
include liabilities included in the consolidated balance sheet under
the headings "accrued and other liabilities" or "minority interest" to
the extent that the inclusion of such liabilities under such headings
is consistent with the Corporation's past practice.
"Assets" means, as of any date of determination, all assets
that should, in accordance with GAAP, be reflected as an asset on
the consolidated balance sheet of the Corporation as of such date of
determination.
"GAAP" means generally accepted accounting principles as in
effect in the United States of America from time to time, consistently
applied.
(e) Voting Rights. The shares of this Series shall not have
any voting powers either general or special, except as required by law,
except as set forth in Section (d) hereof and except that:
(1) (A) If the Corporation shall fail to pay full
cumulative dividends on the shares of this Series or any other of
its preferred shares for six quarterly dividend payment periods,
whether or not consecutive (a "Dividend Default"), the holders of all
outstanding preferred shares, voting as a single class without regard
to series, will be entitled to elect two Directors until full
cumulative dividends for all past dividend payment periods on all
preferred shares have been paid or declared and funds therefor set
apart for payment. Such right to vote separately as a class to
elect Directors shall, when vested, be subject, always, to the same
provisions for the vesting of such right to elect Directors separately
as a class in the case of future Dividend Defaults. At any time when
such right to elect Directors separately as a class shall have so
vested, the Corporation may, and upon the written request of the
holders of record of not less than 20% of the total number of preferred
shares of the Corporation then outstanding shall, call a special
meeting of stockholders for the election of Directors. In the case
of such a written request, such special meeting shall be held within
90 days after the delivery of such request and, in either case, at the
place and upon the notice provided by law and in the Bylaws of the
Corporation, provided that the Corporation shall not be required to
call such a special meeting if such request is received less than 120
days before the date fixed for the next ensuing Annual Meeting of
Shareholders of the Corporation and the holders of all classes of
outstanding preferred shares are afforded the opportunity to elect such
Directors (or fill any vacancy) at such Annual Meeting of Shareholders.
Directors elected as aforesaid shall serve until the next Annual
Meeting of Shareholders of the Corporation or until their respective
successors shall be elected and qualified. If, prior to the end of the
term of any Director elected as aforesaid, a vacancy in the office of
such Director shall occur during the continuance of a Dividend Default
by reason of death, resignation, or disability, such vacancy shall be
filled for the unexpired term by the appointment of a new Director for
the unexpired term of such former Director, such appointment to be made
by the remaining Director elected as aforesaid.
(B) In addition to the right to elect Directors set
forth in clause (A) above, if, without the affirmative vote or the
written consent of the holders of a majority of the shares of this
Series, on the last day of two consecutive fiscal quarters of the
Corporation, the Debt Ratio exceeds 50% (a "Debt Ratio Default"), the
holders of all outstanding shares of this Series, voting as a single
class, will be entitled to elect two Directors until the Debt Ratio as
of the last day of a fiscal quarter of the Corporation is reduced to
50% or less. Such right to vote separately as a class to elect
Directors shall, when vested, be subject, always, to the same
provisions for the vesting of such right to elect Directors separately
as a class in the case of future Debt Ratio Defaults. At any time
when such right to elect Directors separately as a class shall have
so vested, the Corporation may, and upon the written request of the
holders of record of not less than 20% of the total number of shares
of this Series then outstanding shall, call a special meeting of
stockholders for the election of Directors. In the case of such a
written request, such special meeting shall be held within 90 days
after the delivery of such request and, in either case, at the place
and upon the notice provided by law and in the Bylaws of the
Corporation, provided that the corporation shall not be required to
call such a special meeting if such request is received less than 120
days before the date fixed for the next ensuing Annual Meeting of
Shareholders of the Corporation and the holders of shares of this
Series are afforded the opportunity to elect such Directors (or fill
any vacancy) at such Annual Meeting of Shareholders. Directors elected
as aforesaid shall serve until the next Annual Meeting of Shareholders
of the Corporation or until their respective successors shall be
elected and qualified. If, prior to the end of the term of any
Director elected as aforesaid, a vacancy in the office of such Director
shall occur during the continuance of a Debt Ratio Default by reason of
death, resignation, or disability, such vacancy shall be filled for the
unexpired term by the appointment of a new Director for the unexpired
term of such former Director, such appointment to be made by the
remaining Director elected as aforesaid.
(2) The affirmative vote or consent of the holders of at
least 66-2/3% of the outstanding shares of this Series, voting
separately as a class, will be required for any amendment to the
Articles of Incorporation of the Corporation that will adversely alter
or change the powers, preferences, privileges or rights of the shares
of this Series, except as set forth below. The affirmative vote or
consent of the holders of at least 66-2/3% of the outstanding shares
of this Series and any other series of preferred shares ranking on a
parity with this Series as to dividends and upon liquidation (including
the shares of Series A, Series B, Series D, Series E, Series F and
Series G Preferred Stock and Adjustable Rate Preferred Stock), voting
as a single class without regard to series, will be required to issue,
authorize or increase the authorized amount of any class or series of
shares ranking prior to this Series as to dividends or upon liquidation
or to issue or authorize any obligation or security convertible into or
evidencing a right to purchase any such security, but the Articles of
Incorporation may be amended to increase the number of authorized
preferred shares ranking on a parity with or junior to this Series or
to create another class of preferred shares ranking on a parity with or
junior to this Series without the vote of the holders of outstanding
shares of this Series.
(3) The affirmative vote or consent of the holders of a
majority of the outstanding shares of this Series, voting separately as
a class, will be required for any amendment or repeal of the following
provisions of the Bylaws of the Corporation, which would be adverse to
the interests of the holders of shares of this Series, and for any
other changes to the Bylaws of the Corporation that affect these
provisions in a manner which would be adverse to the interests of the
holders of shares of this Series: Article IV, Section 2 (relating to
the Corporation's permissible Asset Coverage), Article VIII, Section
2(g) and (h) (relating to the Corporation's investment policy) and each
of the defined terms used in any of the foregoing provisions.
(4) Except to the extent required pursuant to clause (3)
above, nothing herein shall be taken to require a class vote or consent
in connection with the authorization, designation, increase or issuance
of any shares of any class or series (including additional preferred
shares of any series) that rank junior to or on a parity with this
Series as to dividends and liquidation rights or in connection with
the authorization, designation, increase or issuance of any bonds,
mortgages, debentures or other debt obligations of the Corporation.
(5) The right to elect Directors set forth in clause (1)(B)
above is not intended to be the exclusive remedy of holders of the
shares of this Series in the event of a Debt Ratio Default.
(f) Conversion. The shares of this Series are not
convertible into shares of any other class or series of the capital
stock of the Corporation.