ARTICLES OF AMENDMENT AND RESTATEMENT
OF
BASIC U.S. REIT, INC.
THIS IS TO CERTIFY THAT:
FIRST: Basic U.S. REIT, Inc., a Maryland corporation (the
"Corporation"), desires to amend and restate its charter as currently in effect
and as hereinafter amended.
SECOND: The Articles of Amendment and Restatement of the
Corporation were duly advised by the Board of Directors and approved by the
sole stockholder of the Corporation as required by law.
THIRD: The following provisions are all the provisions of the
charter currently in effect and as hereinafter amended:
ARTICLE I
1. NAME. The name of the Corporation is Basic U.S. REIT, Inc.
ARTICLE II
2. PRINCIPAL OFFICE AND REGISTERED AGENT. The address of the
Corporation's principal office in the State of Maryland is 11 East Chase Street,
Baltimore, Maryland 21202. The name of its registered agent at such address is
CSC-Lawyers Incorporating Service Company.
ARTICLE III
3. PURPOSE. The purposes for which the Corporation is formed are to
engage in any lawful act or activity for which corporations may be organized
under the Maryland General Corporation Law and to possess and exercise all of
the powers and privileges granted by such law and any other law of Maryland.
ARTICLE IV
4. AUTHORIZED CAPITAL. Section 1. The total number of shares of
capital stock which the Corporation shall have authority to issue is as follows:
(a) One Hundred Million (100,000,000) shares of Common Stock, par
value $.01 per share, or $1,000,000 in the aggregate.
(b) Fifty Million (50,000,000) shares of Excess Stock, par value $.01
per share, or $500,000 in the aggregate.
(c) One Million Five Hundred Thousand (1,500,000) shares of Preferred
Stock, par value $.01 per share or $15,000 in the aggregate. The Preferred
Stock may be issued in one or more classes, and in one or more series within a
class, with such voting rights, designations, preferences, qualifications,
privileges, limitations, options, conversion rights, restrictions and special or
relative rights as may be stated in a resolution or resolutions providing for
the issue of such shares adopted from time to time by the Board of Directors and
without the necessity of any action by
the stockholders. The Board of Directors may fix the status of any shares of
Preferred Stock redeemed, canceled, surrendered for conversion or otherwise
retired, and if previously issued shares are reacquired and canceled by the
Corporation, such a number of shares shall thereafter be considered as
authorized and unissued shares.
Notwithstanding the provisions of any such resolution, all Preferred
Stock shall be subject to redemption at the direction of the Board of Directors
at such time or times as the Board shall be of the opinion that ownership of the
capital stock of the Corporation has or may become concentrated to an extent
which may prevent the Corporation from qualifying as a real estate investment
trust ("REIT") under the Internal Revenue Code of 1986, as amended (the "Code").
In such event, the Board shall have the power, by lot or other means deemed
equitable by it, to call for redemption sufficient shares of Preferred Stock to
bring the direct or indirect ownership thereof into conformity with the
requirements for such a REIT. The redemption price paid shall be as specified
by the Board of Directors in its resolution designating the Preferred Stock.
(d) The aggregate par value of all authorized shares of stock of the
Corporation having par value is $1,515,000.
Section 2. COMMON STOCK. Subject to the provisions of Article V,
each share of Common Stock shall entitle the holder thereof to one vote. The
Board of Directors may reclassify any unissued shares of Common Stock from time
to time in one or more classes or series of stock.
Section 3. PREFERRED STOCK. The Board of Directors may classify
any unissued shares of Preferred Stock and reclassify any previously classified
but unissued shares of Preferred Stock of any series, in one or more series of
stock.
ARTICLE V
5. RESTRICTION ON TRANSFER, ACQUISITION AND REDEMPTION OF SHARES
Section 1. DEFINITIONS. For purposes of this Article V, the
following terms shall have the following meanings:
"Beneficial Ownership" shall mean ownership of shares of Equity
Stock by a Person who is or would be an actual owner, for United States
federal income tax purposes, of such shares of Equity Stock or who is or
would be treated as a constructive owner of such shares of Equity Stock
under Section 542(a)(2) of the Code, either directly or constructively
through the application of Section 544 of the Code, as modified by Sections
856(h)(1)(B) and 856(h)(3) of the Code. The terms
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"Beneficial Owner," "Beneficially Owns," "Beneficially Own," "Beneficially
Owning" and "Beneficially Owned" shall have the correlative meanings.
"Charitable Beneficiary" shall mean a beneficiary of the Trust as
determined pursuant to Section 14 of this Article V.
"Code" shall mean the United States Internal Revenue Code of
1986, as amended.
"Common Stock" shall mean the Common Stock of the Corporation,
authorized pursuant to and the rights of which are provided in Article IV.
"Effective Date" shall mean the date as of which the
Corporation's Registration Statement on Form S-11 is declared effective by
the Securities and Exchange Commission.
"Equity Stock" shall mean stock that is either Common Stock or
Preferred Stock.
"Excess Stock" shall mean those shares of Common Stock
and/or Preferred Stock which are classified as Excess Stock as
provided in and pursuant to Section 3.
"Market Price" as to any date shall mean the average of the last
reported closing sales price of Common Stock, or Preferred Stock, as the
case may be, on the ten trading days immediately preceding the relevant
date as reported on the principal United States or foreign securities
exchange or quotation system on or over which the Common Stock, or
Preferred Stock, as the case may be, is listed or admitted to trading, or
if not then listed or traded over any such exchange or quotation system,
then the market price of the Common Stock, or Preferred Stock, as the case
may be, on the relevant date as determined in good faith by the Board of
Directors.
"Ownership Limit" shall initially mean 9.5% of the lesser of the
aggregate number or value of the outstanding shares of Common Stock of the
Corporation and, after any adjustment as set forth in Section 9 of this
Article V, shall mean such percentage as so adjusted. The Board of
Directors of the Corporation may, in its sole discretion, in the
Certificate of Designation for the Preferred Stock, determine a limit on
the ownership of one or more classes or series of its Preferred Stock (the
"Preferred Stock Limit"). From and after such determination, references to
the Ownership Limit herein will include the Preferred Stock Limit, as
applicable. If the Board of Directors does not establish
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a limit on ownership, then the Preferred Stock shall not be restricted from
transfer under this Article V. The number and value of shares of the
Equity Stock of the Corporation shall be determined by the Board of
Directors in good faith, which determination shall be conclusive for all
purposes hereof.
"Person" shall mean an individual, corporation, partnership,
estate, trust (including a trust qualified under Section 401(a) or
501(c)(17) of the Code, a portion of a trust permanently set aside for or
to be used exclusively for the purposes described in Section 642(c) of the
Code, association, private foundation within the meaning of Section 509(a)
of the Code, joint stock company or other entity and also includes a group
as that term is used for purposes of Section 13(d)(3) of the United States
Securities Exchange Act of 1934, as amended, but does not include an
underwriter which participated in a public offering of the Common Stock
and/or Preferred Stock for a period of 30 days following the purchase by
such underwriter of shares of the Common Stock and/or Preferred Stock.
"Purported Beneficial Transferee" shall mean, with respect to any
purported Transfer which results in Excess Stock as described below in
Section 3 of this Article V, the purported beneficial transferee for whom
the Purported Record Transferee would have acquired shares of Equity Stock,
if such Transfer had not been void under Section 2 of this Article V.
"Purported Record Transferee" shall mean, with respect to any
purported Transfer which results in Excess Stock as described below in
Section 3 of this Article V, the record holder of the Equity Stock if such
Transfer had not been void under Section 2 of this Article V.
"Restriction Termination Date" shall mean the first day after the
Effective Date on which the Board of Directors determines that it is no
longer in the best interests of the Corporation to attempt to, or continue
to, qualify as a REIT.
"Transfer" shall mean any issuance, sale, transfer, gift,
assignment, devise or other disposition of Equity Stock (including (i) the
granting of any option or entering into any agreement for the sale,
transfer or other disposition of Equity Stock or (ii) the sale, transfer,
assignment or other disposition of any securities or rights convertible
into or exchangeable for Equity Stock), whether voluntary or involuntary,
whether of record or beneficially, and whether by operation of
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law or otherwise. The terms "Transfers" and "Transferred" shall have the
correlative meanings.
"Trust" shall mean the trust created pursuant to Section 14 of
this Article V.
"Trustee" shall mean the Person that is appointed by the
Corporation pursuant to Section 14 of this Article V to serve as trustee of
the Trust, and any successor thereto.
Section 2. OWNERSHIP LIMITATION. (i) Except as provided in
Section 11 of this Article V, from the Effective Date and prior to the
Restriction Termination Date, no Person shall Beneficially Own shares of Common
Stock and/or Preferred Stock in excess of the Ownership Limit.
(ii) Except as provided in Section 11 of this Article V, from
the Effective Date and prior to the Restriction Termination Date, any Transfer
that, if effective, would result in any Person Beneficially Owning Common Stock
and/or Preferred Stock in excess of the Ownership Limit shall be void AB INITIO
as to the Transfer of such shares of Common Stock and/or Preferred Stock which
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
Common Stock and/or Preferred Stock.
(iii) From the Effective Date and prior to the Restriction
Termination Date, any Transfer that, if effective, would result in the Common
Stock and/or Preferred Stock being Beneficially Owned by less than 100 Persons
(determined without reference to any rules of attribution) shall be void AB
INITIO as to the Transfer of such shares of Common Stock and/or Preferred Stock
which would be otherwise Beneficially Owned by the transferee; and the intended
transferee shall acquire no rights in such shares of Common Stock and/or
Preferred Stock.
(iv) From the Effective Date and prior to the Restriction
Termination Date, any Transfer that, if effective, would result in the
Corporation being "closely held" within the meaning of Section 856(h) of the
Code shall be void AB INITIO as to the Transfer of the shares of Common Stock
and/or Preferred Stock which would cause the Corporation to be "closely held"
within the meaning of Section 856(h) of the Code; and the intended transferee
shall acquire no rights in such shares of Common Stock and/or Preferred Stock.
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Section 3. EXCESS STOCK. (i) If, notwithstanding the other
provisions contained in this Article V, at any time after the date of the
Effective date and prior to the Restriction Termination Date, there is a
purported Transfer or other change in the capital structure of the Corporation
such that any Person would Beneficially Own Common Stock and/or Preferred Stock
in excess of the applicable Ownership Limit, then, except as otherwise provided
in Section 11, such shares of Common Stock and/or Preferred Stock in excess of
such Ownership Limit (rounded up to the nearest whole share) shall be converted
automatically into Excess Stock and be treated as provided in this Article V.
Such conversion and treatment shall be effective as of the close of business on
the business day prior to the date of the purported Transfer or change in
capital structure.
(ii) If, notwithstanding the other provisions contained in this
Article V, at any time after the date of the Effective Date and prior to the
Restriction Termination Date, there is a purported Transfer or other change in
the capital structure of the Corporation which, if effective, would cause the
Corporation to become "closely held" within the meaning of Section 856(h) of the
Code, then the shares of Common Stock and/or Preferred Stock being Transferred
which would cause the Corporation to be "closely held" within the meaning of
Section 856(h) of the Code (rounded up to the nearest whole share) shall be
converted automatically into Excess Stock and be treated as provided in this
Article V. Such conversion and treatment shall be effective as of the close of
business on the business day prior to the date of the purported Transfer or
change in capital structure.
Section 4. PREVENTION OF TRANSFER. If the Board of Directors or its
designee shall at any time determine in good faith that a Transfer has taken
place in violation of Section 2 of this Article V or that a Person intends to
acquire or has attempted to acquire beneficial ownership (determined without
reference to any rules of attribution) or Beneficial Ownership of any shares of
stock of the Corporation in violation of Section 2 of this Article V, the Board
of Directors or its designee shall take such action as it deems advisable to
refuse to give effect to or to prevent such Transfer, including, but not limited
to, refusing to give effect to such Transfer on the books of the Corporation or
instituting proceedings to enjoin or rescind such Transfer; provided, however,
that any Transfers or attempted Transfers in violation of subparagraphs
Section 2(ii) and (iv) of this Article V shall automatically result in the
conversion and treatment described in
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Section 3, irrespective of any action (or non-action) by the Board of Directors.
Section 5. NOTICE TO CORPORATION. Any Person who acquires or
attempts to acquire shares of stock of the Corporation in violation of Section 2
of this Article V, or any Person who is or attempts to become a transferee such
that Excess Stock results under Section 3 of this Article V, shall immediately
give written notice or, in the event of a proposed or attempted Transfer, give
at least 15 days prior 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
on the Corporation's status as a REIT.
Section 6. INFORMATION FOR CORPORATION. From the date of the
Effective Date and prior to the Restriction Termination Date, each Person who is
a Beneficial Owner of Common Stock and/or Preferred Stock and each Person
(including the stockholder of record) who is holding Common Stock and/or
Preferred Stock for a Beneficial Owner shall, upon demand, provide in writing to
the Corporation any information with respect to the direct, indirect and
constructive ownership of Equity Stock of the Corporation as the Board of
Directors deems necessary to comply with the provisions of the Code applicable
to REITs, to comply with the requirements of any taxing authority or
governmental agency or to determine any such compliance.
Section 7. OTHER ACTION BY BOARD. Subject to the provisions of
Section 19 of this Article V, nothing contained in this Article V shall limit
the authority of the Board of Directors to take such other action as it deems
necessary or advisable to protect the Corporation and the interests of its
stockholders by preservation of the Corporation's status as a REIT.
Section 8. AMBIGUITIES. In the case of an ambiguity in the
application of any of the provisions of this Article V, including any definition
contained in Section 1, the Board of Directors shall have the power to determine
the application of the provisions of this Article V with respect to any
situation based on the facts known to it.
Section 9. CHANGE IN OWNERSHIP LIMIT. Subject to the limitations
provided in Section 10 of this Article V, the Board of Directors may from time
to time increase or decrease the Ownership Limit.
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Section 10. LIMITATIONS ON CHANGES IN OWNERSHIP LIMIT. (i) The
Ownership Limit for a class or series of Equity Stock may not be increased if,
after giving effect to such increase, five or fewer Beneficial Owners of Equity
Stock would Beneficially Own, in the aggregate, more than 50.0% in value of the
outstanding shares of Equity Stock.
(ii) Prior to any modification of the Ownership Limit pursuant to
Section 9 of this Article V, the Board of Directors may require such opinions of
counsel, affidavits, undertakings or agreements as it may deem necessary or
advisable in order to determine or ensure the Corporation's status as a REIT.
Section 11. EXEMPTIONS BY BOARD. The Board of Directors may, in its
sole discretion, waive the Ownership Limit with respect to any particular Person
or Persons if evidence satisfactory to the Board of Directors and the
Corporation's tax counsel is presented that the changes in ownership pursuant to
such waiver will not cause the Corporation not to continue to be qualified as a
REIT and are not reasonably likely to cause the Corporation not to continue to
be qualified as a REIT in the future and the Board of Directors otherwise
decides that such action is in the best interests of the Corporation.
Section 12. LEGEND. (i) In addition to any other legend required by
applicable law, each certificate for shares of Common Stock shall bear
substantially the following legend:
The securities represented by this certificate are subject
to restrictions on transfer for the purpose of the
Corporation maintaining its status as a real estate
investment trust (a "REIT") under the United States Internal
Revenue Code of 1986, as amended. Except as otherwise
provided pursuant to the Articles of Incorporation (the
"Articles") of the Corporation, no Person may Beneficially
own shares of Common Stock in excess of 9.5% (or such
greater percentage as may be determined by the Board of
Directors of the Corporation) of the lesser of the aggregate
number or value of the outstanding shares of Common Stock of
the Corporation. Any Person who
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acquires or attempts to acquire shares of Common Stock in
excess of the aforementioned limitation, or any Person who
is or attempts to become a transferee such that Excess Stock
results under the provisions of the Articles, shall
immediately give written notice or, in the event of a
proposed or attempted transfer, give at least 15 days prior
written notice to the Corporation of such event and shall
provide to the Corporation such other information as it may
request in order to determine the effect of any such
Transfer on the Corporation's status as a REIT. All
capitalized terms in this legend have the meanings defined
in the Articles, a copy of which, including the restrictions
on transfer, will be sent to any stockholder on request and
without charge. If the restrictions on transfer are
violated, the securities represented hereby will be
converted into and treated as shares of Excess Stock that
will be transferred, by operation of law, to the trustee of
a trust for the exclusive benefit of one or more charitable
organizations.
(ii) In addition to any legend required by applicable law, each
certificate for shares of Preferred Stock shall bear such legend as may be set
forth in the Certificate of Designation with respect to the transferability of
such Preferred Stock.
Section 13. SEVERABILITY. If any provision of this Article V or any
application of any such provision is determined to be void, invalid or
unenforceable by virtue of any legal decision, statute, rule or regulation, then
the Purported Record Transferee may be deemed, at the option of the Corporation,
to have acted as an agent of the Corporation in acquiring such shares of Excess
Stock and to hold such shares of Excess Stock on behalf of the Corporation, and
the validity and enforceability of remaining provisions shall not be affected
and other applications of such provision shall be affected only to the extent
necessary to comply such determination.
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Section 14. TRUST FOR EXCESS STOCK. Upon any purported Transfer that
results in Excess Stock pursuant to Section 3 of this Article V, such Excess
Stock shall be deemed to have been transferred by operation of law to the
Trustee of a trust (the "Trust") for the exclusive benefit of one or more
Charitable Beneficiaries. The Trustee shall be appointed by the Corporation and
shall be a person unaffiliated with the Corporation, any purported Beneficial
Transferee or any Purported Record Transferee. By written notice to the
Trustee, the Corporation shall designate one or more non-profit organizations to
be the Charitable Beneficiary(ies) of the interest in the Trust representing the
Excess Stock such that (a) the shares of Equity Stock, from which the shares of
Excess Stock held in the Trust were so converted, would not violate the
restrictions set forth in Section 2 of this Article V in the hands of such
Charitable Beneficiary and (b) each Charitable Beneficiary is an organization
described in Sections 170(b)(1)(A), 170(c) and 501(c)(3) of the Code. The
Trustee of the Trust will be deemed to own the Excess Stock for the benefit of
the Charitable Beneficiary on the date of the purported Transfer that results in
Excess Stock pursuant to Section 3 of this Article V. Shares of Excess Stock so
held in trust shall be issued and outstanding stock of the Corporation. The
Purported Record Transferee shall have no rights in such Excess Stock except as
expressly provided for in this Article V.
Section 15. DIVIDENDS ON EXCESS STOCK. Shares of Excess Stock will
be entitled to dividends and distributions authorized and declared with respect
to the class or series of Equity Stock from which the Excess Stock was converted
and will be payable to the Trustee of the Trust in which such Excess Stock is
held, for the benefit of the Charitable Beneficiary. Dividends and
distributions will be authorized and declared with respect to each share of
Excess Stock in an amount equal to the dividends and distributions authorized
and declared on each share of stock of the class or series of Equity Stock from
which the Excess Stock was converted. Any dividend or distribution paid to a
Purported Record Transferee of Excess Stock prior to the discovery by the
Corporation that Equity Stock has been transferred in violation of the
provisions of the Charter shall be repaid by the Purported Record Transferee to
the Trustee upon demand. The Corporation shall rescind any dividend or
distribution authorized and declared but unpaid as void AB INITIO with respect
to the Purported Record Transferee, and the Corporation shall pay such dividend
or distribution when due to the Trustee of the Trust for the benefit of the
Charitable Beneficiary.
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Section 16. LIQUIDATION DISTRIBUTIONS FOR EXCESS STOCK. Subject to
the preferential rights of the Preferred Stock, if any, as may be determined by
the Board of Directors, in the event of any voluntary or involuntary
liquidation, dissolution or winding up of, or any other distribution of all or
substantially all of the assets of the Corporation, each holder of shares of
Excess Stock shall be entitled to receive, in the case of Excess Stock converted
from Preferred Stock, ratably with each other holder of Preferred Stock and
Excess Stock converted from Preferred Stock and having the same rights to
payment upon liquidation, dissolution or winding up as such Preferred Stock and,
in the case of Excess Stock converted from Common Stock, ratably with each other
holder of Common Stock and Excess Stock converted from Common Stock, that
portion of the assets of the Corporation available for distribution to its
stockholders as the number of shares of the Excess Stock held by such holder
bears to the total number of shares of (i) Preferred Stock and Excess Stock then
outstanding (in the case of Excess Stock converted from Preferred Stock) and
(ii) Common Stock and Excess Stock then outstanding (in the case of Excess Stock
converted from Common Stock)
Any liquidation distributions to be distributed with respect to Excess
Stock shall be distributed in the same manner as proceeds from the sale of
Excess Stock are distributed as set forth in Section 18 of this Article V.
Section 17. VOTING RIGHTS FOR EXCESS STOCK. Any vote cast by a
Purported Record Transferee of Excess Stock prior to the discovery by the
Corporation that Equity Stock has been transferred in violation of the
provisions of the Charter shall be void AB INITIO. While the Excess Stock is
held in trust, the Purported Record Transferee will be deemed to have given an
irrevocable proxy to the Trustee to vote the shares of Equity Stock which have
been converted into shares of Excess Stock for the benefit of the Charitable
Beneficiary.
Section 18. NON-TRANSFERABILITY OF EXCESS STOCK. Excess Stock shall
not be transferable. In its sole discretion, the Trustee of the Trust may
transfer the interest in the Trust representing shares of Excess Stock to any
Person if the shares of Excess Stock would not be Excess Stock in the hand of
such Person. If such transfer is made, the interest of the Charitable
Beneficiary in the Excess Stock shall terminate and the proceeds of the sale
shall be payable by the Trustee to the Purported Record Transferee and to the
Charitable Beneficiary as herein set forth. The Purported Record Transferee
shall receive from the Trustee the lesser of
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(i) the price paid by the Purported Record Transferee for its shares of Equity
Stock that were converted into Excess Stock or, if the Purported Record
Transferee did not give value for such shares (e.g., the stock was received
through a gift, devise or other transaction), the average closing price on the
principal United States or foreign securities exchange on which the class of
shares from which such shares of Excess Stock were converted is then listed or
admitted to trading for the ten trading days immediately preceding such sale or
gift and (ii) the price received by the Trustee from the sale or other
disposition of the Excess Stock held in trust. The Trustee may reduce the
amount payable to the Purported Record Transferee by the amount of dividends and
distributions which have been paid to the Purported Record Transferee and are
owed by the Purported Record Transferee to the Trustee pursuant to Section 15 of
this Article V. Any proceeds in excess of the amount payable to the Purported
Record Transferee shall be paid by the Trustee to the Charitable Beneficiary.
Upon such transfer of an interest in the Trust, the corresponding shares of
Excess Stock in the Trust shall be automatically exchanged for an equal number
of shares of Common Stock and/or Preferred Stock, as applicable, and such shares
of Common Stock and/or Preferred Stock, as applicable, would not be Excess Stock
in the hands of such transferee. Prior to any transfer of any interest in the
Trust, the Corporation must have waived in writing its purchase rights under
Section 20 of this Article V.
Section 19. STOCK EXCHANGE TRANSACTIONS. Nothing in this Article V
shall preclude the settlement of any transaction entered into through the
facilities of any United States or foreign securities exchange or quotation
system on which the stock of the Corporation is listed or admitted to trading.
The fact that the settlement of any transaction may occur shall not negate the
effect of any other provision of this Article V and any transferee in such a
transaction shall be subject to all of the provisions and limitations set forth
in this Article V.
Section 20. CALL BY CORPORATION ON EXCESS STOCK. Shares of Excess
Stock shall be deemed to have been offered for sale to the Corporation, or its
designate, at a price per share payable to the Purported Record Transferee equal
to the lesser of (i) the price per share in the transaction that created such
Excess Stock (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 of the Common Stock or
Preferred Stock from which such Excess Stock was converted on the date the
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Corporation, or its designee, accepts such offer. The Corporation may reduce
the amount payable to the Purported Record Transferee by the amount of dividends
and distributions which have been paid to the Purported Record Transferee and
are owed by the Purported Record Transferee to the Trustee pursuant to Section
15 of this Article V. The Corporation may pay the amount of such reductions to
the Trustee for the benefit of the Charitable Beneficiary. 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 Corporation's receipt of notice pursuant to Section
5 of this Article V and (ii) if the Corporation does not receive a notice of
such Transfer pursuant to Section 5 of this Article V, the date that the Board
of Directors determines in good faith that a Transfer resulting in Excess Stock
has occurred, but in no event later than a permitted Transfer pursuant to and in
compliance with the terms of Section 18 of this Article V.
Section 21. ENFORCEMENT. The Corporation is authorized specifically
to seek equitable relief, including injunctive relief, to enforce the provisions
of this Article V.
Section 22. NON-WAIVER. No delay or failure on the part of the
Corporation or the Board of Directors in exercising any right hereunder shall
operate as a waiver of any right of the Corporation or the Board of Directors,
as the case may be, except to the extent specifically waived in writing.
ARTICLE VI
6. INCORPORATOR.
Section 1. The name and mailing address of the incorporator is Brian
M. Wyatt, Schnader Harrison Segal & Lewis, 1600 Market Street, Suite 3600,
Philadelphia, PA 19103.
Section 2. The said incorporator is at least eighteen years of age.
Section 3. The said incorporator is forming the corporation named
in these Articles of Incorporation under the general laws of the State of
Maryland, to wit, the Maryland General Corporation Law.
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ARTICLE VII
7. TERM. The corporation is to have perpetual existence.
ARTICLE VIII
8. BYLAWS. The Board of Directors of the Corporation is authorized
to adopt, amend or repeal the Bylaws of the Corporation, except as otherwise
specifically provided therein.
ARTICLE IX
9. ELECTION OF DIRECTORS. The stockholders and directors shall have
the power to hold their meetings and to keep the books, documents, and papers of
the Corporation outside the State of Maryland, at such places as may be from
time to time designated by the Bylaws or by resolution of the stockholders or
directors, except as otherwise may be required by the laws of the State of
Maryland. Election of Directors need not be by written ballot unless the Bylaws
of the Corporation shall so provide.
ARTICLE X
10. BOARD OF DIRECTORS.
Section 1. NUMBER AND ELECTION. The number of directors of this
Corporation shall be fixed from time to time pursuant to the Bylaws, may not at
any time be less than three and shall initially be five. The number of
directors may be increased or decreased pursuant to the Bylaws but shall never
be less than the minimum number required by the Maryland General Corporation
Law. Directors of this Corporation shall be nominated and elected as provided by
this Article X of the Articles of Incorporation and the Bylaws.
Section 2. INITIAL MEMBERS. The initial members of the Board of
Directors, to hold office until their successors have been duly elected and
qualified at the first annual meeting of stockholders, shall consist of the
following individuals:
Ronald L. Bernbaum
Carl Maynard
Larry Thral
Robert G. Witterick, Q.C.
Nils Peterson
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Section 3. VACANCIES AND NEWLY CREATED DIRECTORSHIPS. Except as
provided in Section 4 of this Article X relating to the rights of holders of
Preferred Stock, newly created directorships resulting from death, resignation,
disqualification, removal or other cause shall be filled solely by the
affirmative vote of the majority of the remaining directors then in office, even
though less than a quorum of the Board of Directors. When the Board fills a
vacancy resulting from the death, resignation, disqualification or removal of a
director, the director chosen to fill that vacancy shall hold office for the
remainder of the term of the directorship.
Section 4. DIRECTORS ELECTED BY PREFERRED STOCK. During any period
in which the holders of Preferred Stock or any one or more series thereof,
voting as a class shall be entitled to elect a specified number of directors by
reasons of dividend arrearages or other contingencies given them the right to do
so, then and during such time as such right continues (a) the then otherwise
authorized number of directors shall be increased by such specified number of
directors and the holders of Preferred Stock or such series thereof, voting as a
class, shall be entitled to elect the additional directors so provided for,
pursuant to the provisions of such Preferred Stock or series; and (b) each such
additional director shall serve until the annual meeting at which the term of
his or her office shall expire and until his or her successor shall be elected
and shall qualify, or until his or her right to hold such office terminates
pursuant to the provisions of such Preferred Stock or series, whichever occurs
earlier. Whenever the holders of such Preferred Stock or series thereof are
divested of such rights to elect a specified number of directors, voting as a
class, pursuant to the provisions of such Preferred Stock or series, the terms
of office of all directors elected by the holders of such Preferred Stock or
series, voting as a class pursuant to such provisions, or elected to fill any
vacancies resulting from the death, resignation, disqualification or removal of
directors so elected by the holders of such Preferred Stock or series, shall
forthwith terminate and the authorized number of directors shall be reduced
accordingly.
Section 5. NOMINATIONS OF DIRECTORS. Nominations of persons for
election to the Board at a meeting of stockholders shall be made only (a) by or
at the direction of the Board or (b) by any stockholder of the Corporation
entitled to vote for the election of directors at such meeting who complies with
the notice procedures set forth in the Bylaws.
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Section 6. AMENDMENT, REPEAL. Notwithstanding the foregoing and
anything contained in these Articles of Incorporation to the contrary, this
Article X shall not be altered, amended or repealed and no provision
inconsistent therewith shall be adopted without the affirmative vote of the
holders of at least 80% of the voting power of the then outstanding shares of
this Corporation entitled to vote generally in the election of directors, voting
together as a single class.
ARTICLE XI
11. LIMITATION ON LIABILITY. To the maximum extent permitted by
Maryland law in effect from time to time, no director or officer of the
Corporation shall be liable to the Corporation or its stockholders for money
damages. Neither the amendment or repeal of this Article 11, nor the adoption
or amendment of any other provision of the Articles or Bylaws inconsistent with
this Article 11, shall apply to or affect in any respect the applicability of
the preceding sentence with respect to any act or failure to act which occurred
prior to such amendment, repeal or adoption. If the Maryland General
Corporation Law is hereafter amended to authorize the further elimination or
limitation of the liability of a director, then the liability of a director of
the Corporation shall be limited or eliminated to the fullest extent permitted
by the amended Maryland General Corporation Law.
ARTICLE XII
12. INDEMNIFICATION. The Corporation shall have the power, to the maximum
extent permitted by Maryland law in effect from time to time, to obligate itself
to indemnify, and to pay or reimburse reasonable expenses in advance of final
disposition of a proceeding to, (a) any individual who is a present or former
director or officer of the Corporation or (b) any individual who, while a
director of the Corporation and at the request of the Corporation, serves or has
served as a director, officer, partner or trustee of another corporation,
partnership, joint venture, trust, employee benefit plan or any other
enterprise, from and against any claim or liability to which such person may
become subject or which such person may incur by reason of his status as a
present or former director or officer of the Corporation. The Corporation may
also, with the approval of the Board of Directors, provide such indemnification
and/or advancement or reimbursement of expenses to any person who served a
predecessor of the Corporation in any of the capacities
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described in (a) or (b) above and to any employee or agent of the Corporation or
a predecessor of the Corporation.
ARTICLE XIII
13. MERGER OR SALE OF ASSETS. No merger or consolidation of the
Corporation, nor any sale, lease or exchange of substantially all of the assets
of the Corporation, may be effected without the affirmative vote of the holders
of 66 2/3% of the outstanding shares of Common Stock of the Corporation entitled
to vote thereon at a meeting of stockholders called for that purpose.
ARTICLE XIV
14. RIGHT TO AMEND. The Corporation reserves the right to amend,
alter, change or repeal any provision contained in these Articles of
Incorporation, in the manner now or hereafter prescribed by statute, including
any amendment altering the terms or contract rights, as expressly set forth in
this charter, of any shares of outstanding stock and all rights conferred upon
stockholders, directors and officers herein are granted subject to this
reservation; provided, however, that these Articles of Incorporation, except as
provided in Article X, may not be amended, altered, changed or repealed without
the affirmative vote of the holders of 66 2/3% of the outstanding shares of
Common Stock of the Corporation entitled to vote thereon at a meeting of
stockholders called for that purpose.
ARTICLE XV
15. PRINCIPAL ADDRESS. The address of the Corporation's principal
office is c/o CSC-Lawyers Incorporating Service Company, 11 East Chase Street,
Baltimore, Maryland 21202.
ARTICLE XVI
16. BUSINESS COMBINATIONS. Title 3, Subtitle 6 of the Maryland
General Corporation Law shall not apply to the Corporation.
FOURTH: The current address of the principal office of the
Corporation is as set forth in Article II of the foregoing amendment and
restatement of the charter.
FIFTH: The name and address of the Corporation's current
resident agent is as set forth in Article II of the foregoing amendment and
restatement of the charter.
SIXTH: The number of directors of the Corporation and the names
of those currently in office are as set forth in Article X of the foregoing
amendment and restatement of the charter.
IN WITNESS WHEREOF, the undersigned has executed this document on
the 25th day of September, 1996.
BASIC U.S. REIT, INC.
BY:/s/Terry McCrae
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Terry McCrae, Vice President, Finance
WITNESS:
/s/Aran Kwinta
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Aran Kwinta, Secretary
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