As filed with the Securities and Exchange Commission on July 9, 2003
Registration No. 333-_____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
EQUITY ONE, INC.
(Exact name of registrant as specified in its charter)
Maryland 52-1794271
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
1696 N.E. Miami Gardens Drive
North Miami Beach, Florida 33179
(305) 947-1664
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
----------------
For the Co-Registrants, Please see "Co-Registrant Information"
on the following page
---------------------
Chaim Katzman
Chairman and Chief Executive Officer
Equity One, Inc.
1696 N.E. Miami Gardens Drive
North Miami Beach, Florida 33179
(305) 947-1664
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent for Service)
--------------------
Copies of communications to:
Arthur L. Gallagher, Esq. Ira N. Rosner, Esq.
General Counsel Greenberg Traurig, P.A.
Equity One, Inc. 1221 Brickell Avenue
1696 N.E. Miami Gardens Drive Miami, Florida 33131
North Miami Beach, Florida 33179 Telephone: (305) 579-0500
Telephone (305) 947-1664 Facsimile: (305) 579-0717
Facsimile (305) 947-1734
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Approximate date of commencement of proposed sale to the public:
From time to time after the effective date of this Registration Statement,
as determined by market conditions and other factors.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 (the "Securities Act"), other than securities offered only in connection
with dividend or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_] _____________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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CALCULATION OF REGISTRATION FEE
================================================== =============== =================== =================== ============
Amount to be Proposed Maximum Proposed Maximum Amount of
Title of Each Class Registered Aggregate Price Per Aggregate Offering Registration
of Securities to be Registered(1) (2)(3) Unit Price (4) Fee(3)
-------------------------------------------------- --------------- ------------------- ------------------- ------------
Common Stock, par value $0.01 per share, Preferred
Stock, par value $0.01 per share, Depository
Shares, Debt Securities and Warrants....... $600,000,000 N/A(5) $600,000,000 $48,540
-------------------------------------------------- --------------- ------------------- ------------------- ------------
Guarantees(6)................................. $755,027,500(7) N/A(5)(8) (8) (9)
-------------------------------------------------- --------------- ------------------- ------------------- ------------
<FN>
(1) This registration statement also covers delayed delivery contracts that may
be issued by the registrant under which the party purchasing such contracts
may be required to purchase common stock, preferred stock, depositary
shares, debt securities, guarantees and warrants. Such contracts would be
issued with the common stock, preferred stock, depositary shares, debt
securities, guarantees or warrants issued hereby. In addition, offered
securities registered hereunder may be sold separately, together or as
units with other offered securities registered hereunder.
(2) Such indeterminate number and principal amount of common stock, preferred
stock, depository shares, debt securities, guarantees and warrants as may
from time to time be issued at indeterminate prices.
(3) Such amount represents the amount computed pursuant to Rule 457(o) under
the Securities Act for any common stock, the liquidation preference of any
preferred stock or depository shares, the principal amount of any debt
securities, the guarantees, the issue price of any warrants and the
exercise price of any securities issuable upon exercise of warrants.
(4) Estimated solely for the purposes of computing the registration fee.
Exclusive of accrued interest, dividends or distributions, if any.
(5) Omitted pursuant to General Instruction II.D of Form S-3 under the
Securities Act.
(6) Represents guarantees, if any, of the debt securities by the
Co-Registrants or one or more of the future subsidiaries of the Registrant.
(7) The amount of guarantees registered pursuant hereto is sufficient to
guarantee the Registrant's debt securities registered pursuant hereto and
an aggregate of $155,027,500 of the Registrant's unissued debt securities
registered pursuant to Registration Statement File No. 333-81216.
(8) The value attributable to the guarantees, if any, is reflected in the
market price of the Registrant's debt securities.
(9) Pursuant to Rule 457(n) under the Securities Act, no separate fee for the
guarantees attributable to the Registrant's debt securities registered
pursuant hereto shall be payable. No separate fee for the guarantees
attributable to the Registrant's debt securities previously registered
pursuant to Registration Statement File No. 33-81216 shall be payable as
such fee was paid with such previously filed Registration Statement.
</FN>
Pursuant to Rule 429 under the Securities Act, the prospectus filed as part
of this registration statement will be used as a combined prospectus in
connection with this Registration Statement and Registration Statement File No.
333-81216.
The Registrant and Co-Registrants hereby amend this Registration Statement
on such date or dates as may be necessary to delay its effective date until the
Registrant and Co-Registrants shall file a further amendment which specifically
states that this Registration Statement shall thereafter become effective in
accordance
with Section 8(a) of the Securities Act of 1933 or until the
Registration Statement shall become effective on such date as the Commission,
acting pursuant to said Section 8(a), may determine.
================================================================================
CO-REGISTRANT INFORMATION
(Primary Standard (State or Other
Industrial Jurisdiction of
(Exact name of Co-Registrants Classification Incorporation or (I.R.S. Employer
as Specified in its Charter) Number) Organization) Identification No.)
--------------------------------------------- ---------------- ------------------ -------------------
Bandera Festival GP, LLC 6798 Texas 76-0693499
Bandera Festival Partners, LP 6798 Texas 76-0693501
BC Center Partners, LP 6798 Texas 26-0038043
Beechnut Centre Corp. 6798 Texas 74-2890871
Beechnut Centre I L.P. 6798 Texas 76-0582026
Benbrook Centre Corp. 6798 Texas 75-2765104
Bend Shopping Centre Corp. 6798 Texas 76-0581701
Bend Shopping Centre I L.P. 6798 Texas 76-0582024
Cashmere Developments, Inc. 6798 Florida 65-0764138
Centerfund (US), LLC 6798 Delaware Applied For
Centrefund Acquisition (Texas) Corp. 6798 Texas 65-0836659
Centrefund Acquisition Corp. 6798 Florida 65-0836659
Centrefund Development (Gainesville) LLC 6798 Delaware 65-0985381
Centrefund Realty (U.S.) Corporation 6798 Delaware 65-0573488
Colony GP, LLC 6798 Texas 76-0693510
Copperfield Crossing, Inc. 6798 Texas 76-0487637
East Townsend Square, Inc. 6798 Texas 75-2412789
Eastbelt Centre Corp. 6798 Texas 74-0581699
Eastbelt Centre I L.P. 6798 Texas 76-0582023
Equity (Landing) Inc. 6798 Texas 76-0388761
Equity One (147) Inc. 6798 Florida 65-0936870
Equity One (Alpha) Corp. 6798 Florida 65-0437659
Equity One (Atlantic Village) Inc. 6798 Florida 65-0578636
Equity One (Beauclerc) Inc. 6798 Florida 65-0843291
Equity One (Beta) Inc. 6798 Florida 59-1391262
Equity One (Butler Creek) Inc. 6798 Georgia 20-0067196
Equity One (Clematis) LLC 6798 Florida 65-0569932
Equity One (Commonwealth) Inc. 6798 Florida 65-0468889
Equity One (Coral Way) Inc. 6798 Florida 65-0757364
Equity One (Delta) Inc. 6798 Florida 65-0477474
Equity One (El Novillo) Inc. 6798 Florida 65-0857773
Equity One (Eustis Square) Inc. 6798 Florida 65-0437661
Equity One (Forest Edge) Inc. 6798 Florida 65-0715123
Equity One (Forest Village Phase II) Inc. 6798 Florida 03-0516594
Equity One (Gamma) Inc. 6798 Florida 65-0411409
Equity One (Lantana) Inc. 6798 Florida 65-0801687
Equity One (Losco) Inc. 6798 Florida 65-0923985
Equity One (Mandarin) Inc. 6798 Florida 65-0480000
Equity One (Monument) Inc. 6798 Florida 65-0704444
Equity One (North Port) Inc. 6798 Florida 65-1054895
Equity One (Oak Hill) Inc. 6798 Florida 65-0624875
Equity One (Olive) Inc. 6798 Florida 65-0624878
Equity One (Point Royale) Inc. 6798 Florida 65-0596743
Equity One (Sheridan) Inc. 6798 Florida 01-0789665
Equity One (Sky Lake) Inc. 6798 Florida 65-0774400
Equity One (Summerlin) Inc. 6798 Florida 65-0835723
Equity One (Walden Woods) Inc. 6798 Florida 65-0887752
Equity One (West Lake) Inc. 6798 Florida 65-0699431
Equity One Acquisition Corp. 6798 Florida 14-1855377
Equity One Construction, Inc. 6798 Florida 65-1064053
Equity One Properties, Inc. 6798 Texas 65-0936518
Equity One Realty & Management Texas, Inc. 6798 Texas 76-0589879
Equity One Realty & Management FL, Inc. 6798 Florida 65-0227351
Equity One Realty & Management SE, Inc. 6798 Georgia 14-1869589
Equity Texas Properties, LLC 6798 Florida 54-2064471
FC Market GP, LLC 6798 Texas 76-0693521
FC Market Partners, LP 6798 Texas 76-0693526
Florida Del Rey Holdings II, Inc. 6798 Florida 65-0276738
Forestwood Equity Partners GP, LLC 6798 Texas 45-0491256
(Cover Page 2)
(Primary Standard (State or Other
Industrial Jurisdiction of
(Exact name of Co-Registrants Classification Incorporation or (I.R.S. Employer
as Specified in its Charter) Number) Organization) Identification No.)
--------------------------------------------- ---------------- ------------------ -------------------
Garland & Barns, LLC 6798 Texas 65-0573488
Garland & Jupiter, LLC 6798 Texas 65-0925238
Gazit (Meridian) Inc. 6798 Florida 65-0324247
Grogan Centre Corp. 6798 Texas 74-2890875
Grogan Centre I L.P. 6798 Texas 76-0487637
Harbor Barker Cypress GP, LLC 6798 Texas 26-0038043
Hedwig GP, LLC 6798 Texas 76-0693506
Hedwig Partners, LP 6798 Texas 76-0693509
Homestead Market Center, Inc. 6798 Florida 02-0602006
IRT Alabama, Inc. 6798 Alabama 58-2336025
IRT Capital Corporation II 6798 Georgia 58-2468877
IRT Management Company 6798 Georgia 58-1896262
IRT Partners L.P. 6798 Georgia 58-2404832
KirkBiss GP, LLC 6798 Texas 76-0693525
Kirkwood - Bissonnet Partners, LP 6798 Texas 76-0693526
Leesburg DrugStore, LLC 6798 Florida 04-3629873
Mariner Outparcel, Inc. 6798 Florida 65-1147382
Mason Park GP, LLC 6798 Texas 76-0693498
Mason Park Partners, LP 6798 Texas 76-0693555
McMinn Holdings, Inc. 6798 Tennessee 62-1868612
North Kingwood Centre Corp. 6798 Texas 76-0581698
Oakbrook Square Shopping Center Corp. 6798 Florida 65-0715448
Parcel F, LLC 6798 Florida 65-1008022
Park Northern/Centennial Partners, L.P. 6798 Texas 86-0842381
Plymouth South Acquisition Corp. 6798 Texas 75-2646378
Prosperity Shopping Center Corp. 6798 Florida 65-0768269
PSL Developments, Inc. 6798 Florida 65-0913546
Ryanwood Shopping Center, L.L.C. 6798 Florida 65-1149161
SA Blanco Village Partners GP, LLC 6798 Texas 61-1415361
SA Blanco Village Partners, LP 6798 Texas 61-1415364
Salerno Village Shopping Center, LLC 6798 Florida 81-0549249
Shoppes at Jonathan's Landing, Inc. 6798 Florida 65-0814957
Shoppes at Westbury Shopping Center, Inc. 6798 Florida 65-0814954
South Kingwood Centre Corp. 6798 Texas 76-0581697
Southwest 19 Northern, Inc. 6798 Arizona 86-1042003
Spring Shadows GP, LLC 6798 Texas 76-0693503
St. Charles Outparcel, Inc. 6798 Florida 03-0516630
Steeplechase Centre Corp. 6798 Texas 74-2890874
Steeplechase Centre I L.P. 6798 Texas 76-0582030
Texas CP Land, LP 6798 Texas 76-0693513
Texas Equity Holdings LLC 6798 Florida 01-0664653
Texas Spring Shadows Partners, LP 6798 Texas 76-0693504
The Harbour Center, Inc. 6798 Florida 65-0354883
The Meadows Shopping Center, LLC 6798 Florida 82-0602043
The Shoppes of Eastwood, LLC 6798 Florida 82-0550520
UIRT GP, L.L.C. 6798 Florida 76-0693531
UIRT I - Centennial, Inc. 6798 Texas Applied For
UIRT LP, L.L.C. 6798 Florida 76-0693532
UIRT, Ltd. 6798 Florida 76-0693533
UIRT-Northwest Crossing, Inc. 6798 Texas 76-0592405
VW Mall, Inc. 6798 Georgia 58-2121895
Wickham DrugStore, LLC 6798 Florida 03-0415075
Wimbledon Center Corp. 6798 Texas 75-0554389
Wurzbach Centre, LLC 6798 Texas 74-2910750
The address, including zip code of each Co-Registrant's principal executive
offices is 1696 N.E. Miami Gardens Drive, North Miami Beach, Florida 33179. The
telephone number, including area code, of each of the Co-Registrants is (305)
947-1664.
The address, including zip code of the agent for service for each of the
Co-Registrants is Chaim Katzman, Chairman and Chief Executive Officer of Equity
One, Inc., 1696 N.E. Miami Gardens Drive, North Miami Beach, Florida 33179. The
telephone number, including area code, of the agent for service for each of the
Co-Registrants is (305) 947-1664.
(Cover Page 3)
SUBJECT TO COMPLETION, DATED JULY 9, 2003
PROSPECTUS
Equity One, Inc.
$755,027,500
Common Stock, Preferred Stock,
Depositary Shares, Debt Securities, Guarantees and Warrants
------------------
We are Equity One, Inc., a real estate investment trust formed as a
corporation under the laws of the State of Maryland. This prospectus relates to
the public offer and sale of common stock, preferred stock, depositary shares,
debt securities and warrants which we and the subsidiary guarantors named below
may offer from time to time in one or more series, with an aggregate public
offering price of up to $755,027,500. We may offer and sell the securities
separately, together or as units, in separate classes or series, in amounts, at
prices and on terms to be determined at the time of sale and set forth in a
supplement to this prospectus.
Each time we sell securities under this prospectus, we will provide the
specific terms of the applicable securities in a supplement to this prospectus
which will include, where applicable:
o in the case of common stock, the number of shares of common stock and
any initial offering price;
o in the case of preferred stock, the number of shares of preferred
stock, the specific title and stated value, any distribution,
liquidation, redemption, conversion, voting and other rights, and any
initial public offering price;
o in the case of depositary shares, the fractional share of our
preferred stock represented by each depositary share;
o in the case of debt securities, the specific title, aggregate
principal amount, currency of denomination and payment, form (which
may be registered or bearer, or certificated or global), authorized
denominations, maturity, rate (or manner of calculation thereof) and
time of payment of interest, terms for redemption at our option or
repayment at the option of the holder of the debt securities, terms
for sinking fund payments, terms for conversion into common, preferred
stock or other securities, any initial offering price and any
guarantees for those debt securities; and
o in the case of warrants to purchase common or preferred stock, the
duration, offering price, exercise price and detachability.
The supplement to this prospectus will also contain information, where
appropriate, about the risk factors and U.S. federal income tax considerations
relating to, and any listing on a securities exchange of, the securities being
offered pursuant to that supplement. To preserve our status as a real estate
investment trust, or REIT, for U.S. federal income tax purposes, we impose
certain restrictions on the ownership of our common stock. You should read this
prospectus and the accompanying prospectus supplement carefully before you
invest.
We may offer the securities from time to time through public or private
transactions, and in the case of our common stock, on or off the New York Stock
Exchange, at prevailing market prices or at privately negotiated prices. Sales
may be made directly to purchasers or to or through agents, broker-dealers or
underwriters. If any agents or underwriters are involved in the sale of any of
these securities, the applicable prospectus supplement will set forth the names
of the agents or underwriters and any applicable fees, commissions or discounts.
Our common stock is listed on the New York Stock Exchange under the symbol
"EQY."
------------------
You should carefully consider the Risk Factors contained in our most recent
annual report on Form 10-K incorporated herein by reference and in the
supplement to this prospectus before buying any offered securities.
------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.
------------------
The date of this prospectus is _______, 2003.
Information in this prospectus is not complete and may be changed. We may not
sell these securities until the registration statement filed with the Securities
and Exchange Commission is effective. This prospectus is not an offer to sell
these securities, and we are not soliciting an offer to buy these securities in
any state where the offer or sale is not permitted.
2
TABLE OF CONTENTS
Page
----
Important Information About this Prospectus..................................4
Forward Looking Information..................................................4
Our Company..................................................................6
Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends....6
Use of Proceeds..............................................................6
Description of Common and Preferred Stock....................................7
Description of Depositary Shares............................................15
Description of Debt Securities..............................................18
Description of Warrants.....................................................31
Material Federal Income Tax Considerations..................................33
Plan of Distribution........................................................47
Legal Matters...............................................................48
Experts.....................................................................48
Where You Can Find More Information.........................................48
Incorporation of Certain Documents by Reference.............................48
3
IMPORTANT INFORMATION ABOUT THIS PROSPECTUS
This prospectus is part of a "shelf" registration statement that we filed
with the United States Securities and Exchange Commission, or the SEC. By using
a shelf registration statement, we may sell any combination of the securities
described in this prospectus from time to time in one or more offerings. We may
use this prospectus to offer and sell up to a total of $755,027,500 of our
securities (including securities registered pursuant to Registration Statement
No. 333-81216). This prospectus only provides you with a general description of
the securities we may offer. Each time we sell securities, we will provide a
supplement to this prospectus that contains specific information about the terms
of the securities offered. The supplement may also add, update or change
information contained in this prospectus. Before purchasing any securities, you
should carefully read both this prospectus and any supplement, together with the
additional information described under the heading "Incorporation of Certain
Documents by Reference" found on page 48.
You should rely only on the information contained or incorporated by
reference in this prospectus and the supplement. We have not authorized any
other person to provide you with different information. If anyone provides you
with different or inconsistent information, you should not rely on it. We will
not make an offer to sell these securities in any jurisdiction where the offer
or sale is not permitted. You should assume that the information appearing in
this prospectus, as well as information we previously filed with the SEC and
incorporated herein by reference, is accurate as of the date on the front cover
of this prospectus only. Our business, financial condition, results of
operations and prospects may have changed since that date.
We will not use this prospectus to offer and sell securities unless it is
accompanied by a supplement that more fully describes the securities being
offered and the terms of the offering.
FORWARD-LOOKING INFORMATION
Certain information both included and incorporated by reference in this
prospectus may contain "forward-looking statements" for purposes of Section 27A
of the Securities Act of 1933, as amended and Section 21E of the Securities
Exchange Act of 1934, as amended. These forward-looking statements are based on
current expectations and are not guarantees of future performance.
All statements other than statements of historical facts are
forward-looking statements and can be identified by the use of forward-looking
terminology such as "may," "will," "might," "would," "expect," "anticipate,"
"estimate," "would," "could," "should," "believe," "intend," "project,"
"forecast," "target," "plan," or "continue" or the negative of these words or
other variations or comparable terminology. These statements are subject to
certain risks, trends and uncertainties that could cause actual results to
differ materially from those expressed or implied by the forward-looking
statements. We caution you not to place undue reliance on these statements,
which speak only as of the date of this prospectus.
Among the factors that could cause actual results to differ materially are:
o general economic conditions, competition and the supply of and demand
for shopping center properties in our markets;
o management's ability to successfully combine and integrate the
properties and operations of separate companies that we have acquired
in the past or may acquire in the future;
o interest rate levels and the availability of financing;
o potential environmental liability and other risks associated with the
ownership, development and acquisition of shopping center properties;
o risks that tenants will not take or remain in occupancy or pay rent;
o greater than anticipated construction or operating costs;
o inflationary, deflationary and other general economic trends;
o the effects of hurricanes and other natural disasters; and
4
o other risks detailed from time to time in the reports filed by us with
the Securities and Exchange Commission.
Except for ongoing obligations to disclose material information as required
by the federal securities laws, we undertake no obligation to release publicly
any revisions to any forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
5
OUR COMPANY
This summary highlights selected information and does not contain all the
information that is important to you. You should carefully read this prospectus,
any applicable prospectus supplement and the documents we have referred you to
in "Incorporation of Certain Documents by Reference" on page 48 of this
prospectus for information about us and our financial statements.
We are Equity One, Inc., a real estate investment trust that acquires,
renovates, develops and manages neighborhood shopping centers anchored by
national or regional supermarket chains and other necessity oriented retailers
such as drug stores or discount retail stores. Our shopping centers are located
primarily in metropolitan areas of the southern United States.
We were established as a Maryland corporation in 1992 and have been
operating as a REIT since 1995. As of July 8, 2003, our portfolio consists of
178 properties, encompassing 122 supermarket-anchored shopping centers, nine
drug store-anchored shopping centers, 40 other retail-anchored shopping centers,
two commercial properties and five retail developments, as well as
non-controlling interests in three joint ventures which own and operate
commercial real estate properties. These properties contain approximately 18.5
million square feet of gross leasable area.
Since 1995, we have consistently elected to be treated as a REIT under the
Internal Revenue Code during each tax year. To qualify as a REIT, we must
satisfy various tests, including tests related to the source and amount of our
income, the nature of our assets and our stock ownership. You should carefully
read the section entitled "Material Federal Income Tax Considerations" in this
prospectus and any applicable supplement relating to this prospectus for
additional information regarding these tests.
Our principal executive offices are located at 1696 N.E. Miami Gardens
Drive, North Miami Beach, Florida 33179, our telephone number is (305) 947-1664
and our facsimile number is (305) 947-1734.
RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
The following table sets forth our historical ratio of earnings to fixed
charges for the periods indicated:
Three Months Ended
Year Ended December 31, March 31,
--------------------------------------------- ------------------
1998 1999 2000 2001 2002 2002 2003
------ ------ ------ ------ ------ ------ ------
2.41 2.65 1.66 1.59 1.92 1.82 2.19
For the purpose of computing the ratio of earnings to fixed charges,
earnings were calculated using pretax income from continuing operations before
adjustment for minority interest and equity in joint ventures, adding fixed
charges and distributed income from joint ventures and subtracting interest
capitalized. Fixed charges consist of interest expensed and capitalized,
amortization of premiums, discounts and capitalized expenses related to
indebtedness. There are no periods in which earnings were insufficient to cover
combined fixed charges. To date, we have not issued preferred stock or incurred
any preferred stock dividends.
USE OF PROCEEDS
Unless the applicable prospectus supplement states otherwise, we expect to
use the net proceeds of the sale of these securities for general corporate
purposes, which may include:
o acquiring properties as suitable opportunities arise;
o developing, maintaining, expanding and improving properties in our
portfolio;
o repayment of indebtedness outstanding at that time;
6
o financing future acquisitions of properties or businesses that we may
from time to time consider; and
o general working capital.
Any specific allocation of the net proceeds of an offering of securities to
a specific purpose will be determined at the time of such offering and will be
described in the related supplement to this prospectus.
DESCRIPTION OF COMMON AND PREFERRED STOCK
The following summarizes certain material terms and provisions of our
capital stock. It does not purport to be complete, however, and is qualified in
its entirety by reference to Maryland law and by the actual terms and provisions
contained in our charter and bylaws, each as amended and restated.
Overview
Our charter authorizes our board of directors to issue 100,000,000 shares
of common stock, par value $0.01 per share, and 10,000,000 shares of preferred
stock, par value $0.01 per share. Our board of directors may classify or
reclassify any unissued shares of capital stock, common, preferred or otherwise,
to provide for the issuance of capital stock in other classes or series of
securities, to establish the number of shares of capital stock in each class or
series and to fix the preferences, conversion and other rights, voting powers,
restrictions, limitations as to distributions, qualification or term.
As of June 30, 2003, 63,610,551 shares of our common stock were issued and
outstanding and no shares of preferred stock were outstanding. Subject to the
New York Stock Exchange rules which require stockholder approval for certain
issuances of securities, we may issue, generally without stockholder approval,
from time to time, in one or more series, shares of capital stock of any class
or series, or securities or rights convertible into shares of capital stock of
any class or series, for such consideration as our board of directors may deem
advisable, subject to any applicable limitations or restrictions under Maryland
law or our charter or bylaws.
The following description sets forth certain general terms and
provisions of our common and preferred stock to which a supplement to this
prospectus may relate. The particular terms of the shares of common or preferred
stock being offered and the extent to which the general provisions may apply
will be described in the applicable supplement to this prospectus. If so
indicated in the applicable supplement to this prospectus, the terms of any
series of shares of capital stock may differ from the terms set forth below,
except with respect to those terms required by our charter and bylaws.
General Description of our Common Stock
General. Subject to the provisions of our charter regarding ownership of
shares of capital stock in excess of the aggregate ownership limits described
below, unless otherwise provided for in the applicable supplement to this
prospectus, our shares of common stock have equal dividend, liquidation and
other rights, and have no preference, appraisal or exchange rights. Holders of
our common stock have no conversion, sinking fund or redemption rights, or
preemptive rights to subscribe for any of our securities.
Distributions. Subject to any preferential rights of any outstanding shares
of preferred stock and to the provisions of our charter regarding ownership of
shares in excess of the aggregate stock ownership limit, our common stockholders
are entitled to receive distributions, when and as authorized by our board of
directors, out of legally available funds.
Voting Rights. Each outstanding share of common stock entitles the holder
to one vote on all matters presented to stockholders for a vote, including the
election of directors. Except as provided in the terms of any other class or
series of stock, the holders of common stock possess the exclusive voting power,
subject to the provisions of our charter regarding the ownership of shares of
common stock in excess of the aggregate stock ownership limit, or such other
limit as provided in our charter or as otherwise permitted by the board of
directors.
7
Liquidation Rights. Subject to the right of any holders of preferred stock
to receive preferential distributions, if we are liquidated, each outstanding
share of common stock will be entitled to participate pro rata in the assets
remaining after payment of, or adequate provision for, all of our known debts
and liabilities.
Registrar and Transfer Agent. The registrar and transfer agent for our
capital stock is American Stock Transfer & Trust Company.
General Description of Preferred Stock
General. Under our charter, the board of directors is authorized, subject
to certain limitations prescribed by Maryland law and the New York Stock
Exchange rules, without further stockholder approval, from time to time to issue
up to an aggregate of 10,000,000 shares of preferred stock. The preferred stock
may be issued in one or more series. Subject to the provisions of our charter
regarding ownership of shares of capital stock in excess of the aggregate stock
ownership limits, each series may have different rights, preferences and
designations and qualifications, limitations and restrictions that may be
established by our board of directors without approval from the stockholders.
Unless provided in a supplement to this prospectus, the shares of preferred
stock to be issued will have no preemptive rights. Reference is made to any
supplement to this prospectus relating to the preferred stock offered thereby
for specific items, including:
o the number of shares of preferred stock to be issued and the offering
price of such preferred stock;
o the title and stated value of such preferred stock;
o dividend rights;
o dividend rates, periods, or payment dates, or methods of calculation
of dividends applicable to such preferred stock;
o the date from which distributions on such preferred stock shall
accumulate, if applicable;
o the right to convert the preferred stock into a different type of
security;
o voting rights attributable to the preferred stock;
o rights and preferences upon our liquidation or winding up of our
affairs;
o the terms of redemption;
o the procedures for any auction and remarketing, if any, for such
preferred stock;
o the provisions for a sinking fund, if any, for such preferred stock;
o any listing of such preferred stock on any securities exchange;
o the terms and conditions, if applicable, upon which such preferred
stock will be convertible into common stock, including the conversion
price (or manner of calculation thereof);
o a discussion of federal income tax considerations applicable to such
preferred stock;
o the relative ranking and preferences of such preferred stock as to
distribution rights (including whether any liquidation preference as
to the preferred stock will be treated as a liability for purposes of
determining the availability of assets for distributions to holders of
stock ranking junior to the shares of preferred stock as to
distribution rights);
o any limitations on issuance of any series of preferred stock ranking
senior to or on a parity with such series of preferred stock as to
distribution rights and rights upon the liquidation, dissolution or
winding up of our affairs; and
8
o any other specific terms, preferences, rights, limitations or
restrictions of such preferred stock.
Rank. Unless otherwise indicated in the applicable supplement to this
prospectus, shares of our preferred stock will rank, with respect to payment of
distributions and rights upon our liquidation, dissolution or winding up, and
allocation of our earnings and losses:
o senior to all classes or series of common stock, and to all equity
securities ranking junior to such preferred stock;
o on a parity with all equity securities issued by us, the terms of
which specifically provide that such equity securities rank on a
parity with the preferred stock; and
o junior to all equity securities issued by us, the terms of which
specifically provide that such equity securities rank senior to the
preferred stock.
Distributions. Subject to any preferential rights of any outstanding stock
or series of stock and to the provisions of our charter regarding ownership of
shares of common stock in excess of the aggregate ownership limits, our
preferred stockholders are entitled to receive distributions, when and as
authorized by our board of directors, out of legally available funds, and share
pro rata based on the number of preferred shares, common stock and other parity
equity securities outstanding.
Voting Rights. Unless otherwise indicated in the applicable supplement to
this prospectus, holders of our preferred stock will not have any voting rights.
Liquidation Preference. Upon the voluntary or involuntary liquidation,
dissolution or winding up of our affairs, then, before any distribution or
payment shall be made to the holders of any common stock or any other class or
series of stock ranking junior to the preferred stock in our distribution of
assets upon any liquidation, dissolution or winding up, the holders of each
series of preferred stock are entitled to receive, after payment or provision
for payment of our debts and other liabilities, out of our assets legally
available for distribution to stockholders, liquidating distributions in the
amount of the liquidation preference per share (set forth in the applicable
supplement to this prospectus), plus an amount, if applicable, equal to all
distributions accrued and unpaid thereon (which shall not include any
accumulation in respect of unpaid distributions for prior distribution periods
if such preferred stock do not have a cumulative distribution). After payment of
the full amount of the liquidating distributions to which they are entitled, the
holders of preferred stock will have no right or claim to any of our remaining
assets. In the event that, upon our voluntary or involuntary liquidation,
dissolution or winding up, the legally available assets are insufficient to pay
the amount of the liquidating distributions on all of our outstanding preferred
stock and the corresponding amounts payable on all of our stock of other classes
or series of equity security ranking on a parity with the preferred stock in the
distribution of assets upon liquidation, dissolution or winding up, then the
holders of our preferred stock and all other such classes or series of equity
security shall share ratably in any such distribution of assets in proportion to
the full liquidating distributions to which they would otherwise be respectively
entitled.
If the liquidating distributions are made in full to all holders of
preferred stock, our remaining assets shall be distributed among the holders of
any other classes or series of equity security ranking junior to the preferred
stock upon our liquidation, dissolution or winding up, according to their
respective rights and preferences and in each case according to their respective
number of shares of stock.
Conversion Rights. The terms and conditions, if any, upon which shares of
any series of preferred stock are convertible into other securities will be set
forth in the applicable supplement to this prospectus. Such terms will include
the amount and type of security into which the shares of preferred stock are
convertible, the conversion price (or manner of calculation thereof), the
conversion period, provisions as to whether conversion will be at the option of
the holders of the preferred stock or us, the events requiring an adjustment of
the conversion price and provisions affecting conversion in the event of the
redemption of such preferred stock.
Redemption. If so provided in the applicable supplement to this prospectus,
our preferred stock will be subject to mandatory redemption or redemption at our
option, in whole or in part, in each case upon the terms, at the times and at
the redemption prices set forth in such supplement to this prospectus.
9
Registrar and Transfer Agent. The registrar and transfer agent for our
preferred stock will be set forth in the applicable supplement to this
prospectus.
If our board of directors decides to issue any preferred stock, it may
discourage or make more difficult a merger, tender offer, business combination
or proxy contest, assumption of control by a holder of a large block of our
securities or the removal of incumbent management, even if these events were
favorable to the interests of stockholders. The board of directors, without
stockholder approval, may issue preferred stock with voting and conversion
rights and dividend and liquidation preferences which may adversely affect the
holders of common stock.
REIT Ownership Limitations
For us to qualify as a REIT under the Internal Revenue Code, no more than
50% in value of our outstanding shares of capital stock, common or preferred,
may be owned, actually or constructively, by five or fewer "individuals," which,
as defined in the Internal Revenue Code for this purpose, includes some
entities. In addition, if we, or an actual or constructive owner of 10% or more
of our shares of our capital stock, own, actually or constructively, 10% or more
of one of our tenants, then the rent received by us from that "related party
tenant" will not be qualifying income for purposes of determining whether we
meet the requirements for qualification as a REIT under the Internal Revenue
Code unless the tenant is a taxable REIT subsidiary and specified requirements
are met. A REIT's shares also must be beneficially owned by 100 or more persons
during at least 335 days of a taxable year.
As a means of addressing these requirements, our charter provides that,
subject to exceptions, no person may own, or be deemed to own, directly or by
virtue of the attribution provisions of the Internal Revenue Code, more than
9.9%, in value or number of shares of our capital stock, whichever is more
restrictive, of the aggregate outstanding shares of stock of any class or series
of stock. Under our charter, the board of directors may increase the ownership
limit with respect to any class or series of shares of capital stock. In
addition, our board of directors, in its sole discretion, may exempt a person
from the ownership limits and may establish a new limit applicable to that
person if such person submits to the board of directors such representations and
undertakings that demonstrate, to the reasonable satisfaction of the board, that
such ownership would not jeopardize our status as a REIT under the Internal
Revenue Code. Our charter further prohibits any person from transferring any of
our common or preferred shares of stock if the transfer would result in our
shares of capital stock being owned by fewer than 100 persons or otherwise would
cause us not to qualify as a REIT.
If any transfer of shares of capital stock or any other event would
otherwise result in any person violating the ownership limits, then our charter
provides that the transfer will be void and of no force or effect with respect
to the prohibited transferee with respect to that number of shares of capital
stock that exceeds the ownership limits and the prohibited transferee would not
acquire any right or interest in the shares. The shares transferred in violation
of the ownership limit instead would be transferred automatically to a
charitable trust, the beneficiary of which would be a qualified charitable
organization selected by us. If the transfer to the charitable trust of the
shares that were transferred in violation of the ownership limit is not
automatically effective for any reason, then the transfer that resulted in the
violation of the ownership limit would be void.
The charitable trustee will have the sole right to vote the shares of stock
that it holds, and any distributions paid on shares held by the charitable
trustee would be paid to the beneficiary of the charitable trust. The trustee of
the charitable trust would be required to sell the shares of stock transferred
in violation of the ownership limit to a person or entity who could own the
shares of stock without violating the ownership limit, and to distribute to the
prohibited transferee an amount equal to the lesser of the price paid by such
person for the shares of stock transferred in violation of the ownership limit
or the sales proceeds received by the charitable trust for the shares. In the
case of a transfer for no consideration, such as a gift, the charitable trustee
would be required to sell the shares of stock to a qualified person or entity
and distribute to the prohibited transferee an amount equal to the lesser of the
fair market value of the shares of stock on the date of the event causing the
shares to be held in the trust or the sales proceeds received by the charitable
trust for the shares.
Under our charter, we, or our designee, would have the right to purchase
the shares from the charitable trust at a price per share equal to the lesser of
the price per share in the transaction that resulted in the transfer of the
shares to the charitable trust, or, in the case of a devise or gift, the market
price at the time of such devise or gift, and the market price of such shares on
the date we, or our designee, were to agree to purchase the shares. Any proceeds
10
derived from the sale of the shares of capital stock in excess of the amount
distributed to the prohibited transferee under these provisions would be
distributed to the beneficiary of the charitable trust.
All persons or entities who own, directly or by virtue of the attribution
provisions of the Internal Revenue Code, more than 5% (or such lower percentage
as required by the Internal Revenue Code or U.S. tax regulations) of the
outstanding shares of our capital stock must give a written notice to us by
January 30 of each year stating the name and address of such owner, the number
of shares of our capital stock owned and a description of the manner in which
such shares of capital stock are held. In addition, each holder of shares of our
capital stock subject to the foregoing ownership requirement shall provide us
with such additional information as we may request in order to determine the
effect, if any, of such ownership on our status as a REIT and to ensure
compliance with the ownership limit discussed above. Finally, each beneficial
owner of shares of our capital stock and each person (including the stockholder
of record) who is holding shares of our stock as a nominee for a beneficial
owner must provide us with such information as we may request, in good faith, in
order to determine its status as a REIT and to comply with requirements of any
taxing authority or governmental authority or to determine such compliance.
The foregoing restrictions on ownership and transferability would not apply
if our board of directors were to determine that it is no longer in our best
interests to attempt to qualify, or to continue to qualify, as a REIT under the
Internal Revenue Code.
Anti-takeover Effects of Maryland Law
Statutory Takeover Provisions. Maryland law provides protection for
Maryland corporations against unsolicited takeovers by protecting the board of
directors with regard to actions taken in a takeover context. The Maryland
General Corporation Law provides that the duties of directors will not require
them to:
o accept, recommend, or respond to any proposal by a person seeking to
acquire control;
o make a determination under the Maryland Business Combination Statute
or the Control Share Acquisition Statute, as described below;
o authorize the corporation to redeem any rights under, modify or render
inapplicable, a stockholders' rights plan;
o elect to be subject to any or all of the "elective provisions"
described below; or
o act or fail to act solely because of:
- the effect the act or failure to act may have on an acquisition or
potential acquisition of control; or
- the amount or type of consideration that may be offered or paid to
stockholders in an acquisition.
Under Maryland law, there is also a presumption that the act of a director
satisfies the required standard of care. In the case of a Maryland corporation,
a director must perform his or her duties in good faith, in a manner the
director believes is in the best interests of the corporation and with the care
that an ordinarily prudent person in a like position would use under similar
circumstances. In addition, an act of a director relating to or affecting an
acquisition or a potential acquisition of control is not subject under Maryland
law to a higher duty or greater scrutiny than is applied to any other act of a
director. This provision creates a Maryland rule which is less exacting than
case law in many other jurisdictions which imposes an enhanced level of scrutiny
when a board implements anti-takeover measures in a change of control context,
and shifts the burden of proof to directors to show that they complied with
their fiduciary duties.
Maryland legislation enacted in 1999 allows publicly held Maryland
corporations to elect to be governed by all or any part of Maryland law
provisions relating to extraordinary actions and unsolicited takeovers. The
election to be governed by one or more of these provisions can be made by a
Maryland corporation in its charter or bylaws or by resolution adopted by the
board of directors, without a vote of stockholders, so long as the corporation
has at least three directors who, at the time of electing to be subject to the
provisions, are not:
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o persons seeking to acquire control of the corporation;
o officers or employees of the corporation;
o directors, officers, affiliates or associates of any person seeking to
acquire control; or
o nominated or designated as directors by a person seeking to acquire
control.
Articles supplementary must be filed with the State Department of
Assessments and Taxation of Maryland if a Maryland corporation elects to be
subject to any or all of the provisions by board resolution or bylaw amendment.
Stockholder approval is not required for the filing of articles supplementary.
The Maryland legislation provides that a corporation can elect to be
subject to all or any portion of the following provisions notwithstanding any
contrary provisions contained in the corporation's existing charter or bylaws:
o Classified Board: The corporation may divide its board into three
classes which, to the extent possible, will have the same number of
directors, the terms of which will expire at the third annual meeting
of stockholders after the election of each such class;
o Two-Thirds Stockholder Vote to Remove Directors Only for Cause: The
stockholders may remove any director, as applicable, only by the
affirmative vote of at least two-thirds of all the votes entitled to
be cast by the stockholders generally in the election of directors,
but a director may not be removed without cause;
o Size of Board Fixed by Vote of Board: The number of directors, as
applicable, will be fixed only by resolution of the board;
o Board Vacancies Filled by the Board for the Remaining Term: Vacancies
that result from an increase in the size of the board, or the death,
resignation, or removal of a trustee or director, may be filled only
by the affirmative vote of a majority of the remaining directors even
if they do not constitute a quorum. Directors elected to fill
vacancies will hold office for the remainder of the full term of the
class of trustees or directors in which the vacancy occurred, as
opposed to until the next annual meeting of stockholders, and until a
successor is elected and qualified; and
o Stockholder Calls of Special Meetings: Special meetings of
stockholders shall be called by the secretary of the corporation only
upon the written request of stockholders entitled to cast at least a
majority of all votes entitled to be cast at the meeting.
Although we have not specifically elected to be governed by the 1999
legislation, our charter and bylaws, as applicable, contain provisions that are
similar to those listed above. See "Provisions of our Charter and Bylaws that
May Prevent Takeovers" below. Moreover, our board of directors may elect to be
governed by the 1999 legislation in the future.
Business Combinations with Interested Securityholders. The Maryland
Business Combination Act provides that, unless exempted, a Maryland corporation
may not engage in business combinations, including mergers, dispositions of 10%
or more of its assets, issuances of shares and other specified transactions,
with an "interested stockholder" or its affiliates, for five years after the
most recent date on which the interested stockholder became an interested
stockholder. Thereafter, unless the stockholders receive a minimum price, as
defined under Maryland law, a business combination with an interested
stockholder or its affiliates must be recommended by the board of directors and
approved by (i) at least 80% of the outstanding voting shares and (ii) at least
two-thirds of the outstanding voting shares entitled to be cast, other than
voting shares held by the interested stockholder or any of its affiliates. Under
the statute, an "interested stockholder" generally is defined to mean a person
or group which owns beneficially, directly or indirectly, 10% or more of the
voting power of the corporation's shares or an affiliate or an associate of the
corporation who, at any time within the two year period prior to the date in
question, was the beneficial owner of 10% or more of the voting power of the
then outstanding voting stock of the corporation. A person is not an interested
stockholder under the statute if the board of directors approved in advance the
transaction
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by which that person otherwise would have become an interested stockholder.
These requirements do not apply to a business combination with an interested
stockholder or its affiliates if the business combination is exempted by the
board of directors before the time the interested stockholder first became an
interested stockholder.
By resolution of our board of directors, we have exempted business
combinations between us and any of our officers or directors or any affiliate of
our officers or directors. Consequently, the five-year prohibition and the
super-majority vote requirements will not apply to those business combinations.
The business combination statute may discourage others from trying to
acquire control of us and increase the difficulty of consummating any offer with
respect to business combinations.
Control Share Acquisitions. The Maryland Control Share Acquisition Act
provides that shares of a Maryland corporation that are acquired in a "control
share acquisition," which is defined as the acquisition, directly or indirectly,
of shares comprising one-tenth or more, but less than one-third, one-third or
more, but less than a majority or a majority or more of all voting shares, have
no voting rights except:
o if approved by stockholders by the affirmative vote of two-thirds of
all the votes entitled to be cast on the matter, excluding shares
owned by the acquiror, by officers or by directors who are employees
of the corporation; or
o if the acquisition of the shares has been approved or exempted at any
time before the acquisition of the shares.
Control shares do not include shares the acquiring person is then entitled
to vote as a result of having previously obtained stockholder approval.
A person who has made or proposes to make a control share acquisition may
compel the board of directors of the corporation to call a special meeting of
stockholders to be held within 50 days of demand to consider the voting rights
of the shares. The right to compel the calling of a special meeting is subject
to the satisfaction of certain conditions, including an undertaking to pay the
expenses of the meeting. If no request for a meeting is made, the corporation
may itself present the question at any stockholder meeting.
If voting rights are not approved at the meeting or if the acquiring person
does not deliver an acquiring person statement as required by the statute, then
the corporation may redeem for fair value any or all of the control shares,
except those for which voting rights have previously been approved. The right of
the corporation to redeem control shares is subject to certain conditions and
limitations. Fair value is determined, without regard to the absence of voting
rights for the control shares, as of the date of the last control share
acquisition by the acquiror or of any meeting of stockholders at which the
voting rights of the shares are considered and not approved. If voting rights
for control shares are approved at a stockholder meeting and the acquiror
becomes entitled to vote a majority of the shares entitled to vote, all other
stockholders may exercise appraisal rights. The fair value of the shares as
determined for purposes of appraisal rights may not be less than the highest
price per share paid by the acquiror in the control share acquisition.
The Maryland Control Share Acquisition Act is applicable to a publicly
traded Maryland corporation unless its charter or bylaws specifically provides
that it shall be inapplicable. Our bylaws contain a provision exempting us from
the control share acquisition act. There can be no assurance that this provision
will not be amended or eliminated at any time in the future, thereby making our
company subject to the act.
Mergers, Consolidations, and Sale of Assets. Under Maryland law, a proposed
consolidation, merger, share exchange or transfer of assets must be approved by
the affirmative vote of two-thirds of all the votes entitled to vote on the
matter, unless a greater or lesser proportion of votes (but not less than a
majority of all votes entitled to be cast) is specified in the charter. Our
charter reduces the vote requirement to a majority of the votes entitled to be
cast.
However, approval of a merger by stockholders is not required if:
o the merger does not reclassify or change the terms of any class or
series of stock that is
13
outstanding immediately before the merger becomes effective or
otherwise require the amendment to the corporation's charter; and
o the number of shares of stock of such class or series outstanding
immediately after the effective time of the merger does not increase
by more than 20% of the number of shares of the class or series of
stock that is outstanding immediately before the merger becomes
effective, or there is no stock outstanding or subscribed for and
entitled to be voted on the merger.
Under these circumstances, a majority vote of the entire board of directors
is sufficient for approval.
Provisions of our Charter and Bylaws That May Prevent Takeovers
Our charter and our bylaws contain provisions that may delay, defer or
prevent a change in control of us and make removal of our management more
difficult.
Classification of the Board. Maryland law permits a Maryland corporation to
divide its board of directors into classes with staggered terms of office so
long as the term of office of at least one class expires each year. Our bylaws
divide the board of directors into three classes, as nearly equal in number as
possible, with classes being elected to three-year terms on a rotating basis.
Number of Directors; Removal of Directors; Vacancies. Our charter and
bylaws provide that the board of directors may increase or decrease the number
of directors provided that the number thereof shall never be less than the
minimum number required by Maryland law nor more than 15.
Pursuant to our charter, subject to the rights of one or more classes or
series of preferred stock to elect or remove one or more directors, any and all
directors may be removed from office at any time, but only for cause, and by an
affirmative vote of at least two-thirds of the votes entitled to be cast
generally in the election of directors. Our charter defines "cause" to mean,
with respect to any particular director, the conviction of a felony or a final
judgment of a court of competent jurisdiction holding that the director caused
demonstrable, material harm to us through bad faith or active and deliberate
dishonesty.
Under our bylaws, any vacancy on the board of directors for any cause other
than an increase in the number of directors shall be filled by a majority of the
remaining directors, even if such majority is less than a quorum. Any vacancy on
the board of directors created by an increase in the number of directors may be
filled by a majority vote of the entire board of directors. Any individual so
elected as a director shall hold office until the next annual meeting of
stockholders and until his successor is elected and qualifies.
Stockholder Requested Special Meetings. Our bylaws provide that special
meetings of stockholders may be called by the board of directors, the president
or the chief executive officer. Special meetings of the stockholders may also be
called by the secretary of the corporation upon the written request of the
holders of shares entitled to cast not less than a majority of all the votes
entitled to be cast at the meeting.
Stockholder Action by Written Consent. Although Maryland law provides for
stockholder action by unanimous written consent, our bylaws do not permit
stockholder action by written consent.
Advance Notice Provisions for Stockholder Nominations and Stockholder New
Business Proposals. Our bylaws require advance written notice for stockholders
to nominate a director or bring other business before a meeting of stockholders.
For an annual meeting, a stockholder must deliver notice to our secretary
not later than the close of business on the 60th day nor earlier than the close
of business on the 90th day before the first anniversary of the preceding year's
annual meeting. However, if the date of the annual meeting is advanced by more
than 30 days or delayed by more than 60 days from the applicable anniversary
date of the prior year's annual meeting, or the meeting is a special meeting of
stockholders at which directors will be elected, notice of a director nomination
by a stockholder must be given not earlier than the close of business on the
90th day before the meeting and not later than the close of business on the
later of the 60th day before the meeting or the tenth day following the day on
which we first made a public announcement of the date of the meeting.
14
Our bylaws contain detailed requirements for the contents of stockholder
notices of director nominations and new business proposals.
The foregoing provisions, together with the ability of the board of
directors to issue preferred stock without further stockholder action, may delay
or frustrate the removal of incumbent directors or the completion of
transactions that would be beneficial, in the short term, to our stockholders.
The provisions may also discourage or make more difficult a merger, tender
offer, other business combination or proxy contest, the assumption of control by
a holder of a large block of our securities or the removal of incumbent
management, even if these events would be favorable to the interests of our
stockholders.
DESCRIPTION OF DEPOSITARY SHARES
General
We may issue depositary shares, each of which will represent a fractional
interest of a share of a particular class or series of our preferred stock, as
specified in the applicable prospectus supplement which will more fully describe
the terms of those depositary shares. Shares of a class or series of preferred
stock represented by depositary shares will be deposited under a separate
deposit agreement among us, the depositary named therein and the holders from
time to time of the depositary receipts issued by the preferred stock depositary
which will evidence the depositary shares. Subject to the terms of the deposit
agreement, each owner of a depositary receipt will be entitled, in proportion to
the fractional interest of a share of a particular class or series of preferred
stock represented by the depositary shares evidenced by that depositary receipt,
to all the rights and preferences of the class or series of preferred stock
represented by those depositary shares (including dividend, voting, conversion,
redemption and liquidation rights).
The depositary shares to be issued will be evidenced by depositary receipts
issued pursuant to the applicable deposit agreement. Immediately following the
issuance and delivery of a class or series of preferred stock by us to the
preferred stock depositary, we will cause the preferred stock depositary to
issue, on our behalf, the depositary receipts. The following description of the
depositary shares, and any description of the depositary shares in a prospectus
supplement, may not be complete and is subject to, and qualified in its entirety
by reference to, the underlying deposit agreement and the depositary receipt,
which we will file with the SEC at or prior to the time of the sale of the
depositary shares. You should refer to, and read this summary together with, the
deposit agreement and related depositary receipt. You can obtain copies of any
form of deposit agreement or other agreement pursuant to which the depositary
shares are issued by following the directions described under the caption "Where
You Can Find More Information."
Dividends and Other Distributions
The preferred stock depositary will distribute all cash dividends or other
cash distributions received in respect of a class or series of preferred stock
to the record holders of depositary receipts evidencing the related depositary
shares in proportion to the number of those depositary receipts owned by those
holders, subject to certain obligations of holders to file proofs, certificates
and other information and to pay certain charges and expenses to the preferred
stock depositary.
In the event of a distribution other than in cash, the preferred stock
depositary will distribute property received by it to the record holders of
depositary receipts entitled thereto, subject to certain obligations of holders
to file proofs, certificates and other information and to pay certain charges
and expenses to the preferred stock depositary, unless the preferred stock
depositary determines that it is not feasible to make that distribution, in
which case the preferred stock depositary may, with our approval, sell that
property and distribute the net proceeds from that sale to those holders.
Withdrawal of Preferred Stock
Upon surrender of the depositary receipts at the corporate trust office of
the preferred stock depositary (unless the related depositary shares have
previously been called for redemption or converted into excess preferred stock
or otherwise), the holders thereof will be entitled to delivery at that office,
to or upon that holder's order, of the number of whole or fractional shares of
the class or series of preferred stock and any money or other property
15
represented by the depositary shares evidenced by those depositary receipts.
Holders of depositary receipts will be entitled to receive whole or fractional
shares of the related class or series of preferred stock on the basis of the
proportion of preferred stock represented by each depositary share as specified
in the applicable prospectus supplement, but holders of those shares of
preferred stock will not thereafter be entitled to receive depositary shares
therefor. If the depositary receipts delivered by the holder evidence a number
of depositary shares in excess of the number of depositary shares representing
the number of shares of preferred stock to be withdrawn, the preferred stock
depositary will deliver to that holder at the same time a new depositary receipt
evidencing the excess number of depositary shares.
Redemption of Depositary Shares
Whenever we redeem shares of a class or series of preferred stock held by
the preferred stock depositary, the preferred stock depositary will redeem as of
the same redemption date the number of depositary shares representing shares of
the class or series of preferred stock so redeemed, provided we shall have paid
in full to the preferred stock depositary the redemption price of the preferred
stock to be redeemed plus an amount equal to any accrued and unpaid dividends
thereon to the date fixed for redemption. The redemption price per depositary
share will be equal to the corresponding proportion of the redemption price and
any other amounts per share payable with respect to that class or series of
preferred stock. If fewer than all the depositary shares are to be redeemed, the
depositary shares to be redeemed will be selected pro rata (as nearly as may be
practicable without creating fractional depositary shares) or by any other
equitable method determined by us that will not result in the issuance of any
excess preferred stock.
From and after the date fixed for redemption, all dividends in respect of
the shares of a class or series of preferred stock so called for redemption will
cease to accrue, the depositary shares so called for redemption will no longer
be deemed to be outstanding and all rights of the holders of the depositary
receipts evidencing the depositary shares so called for redemption will cease,
except the right to receive any moneys payable upon their redemption and any
money or other property to which the holders of those depositary receipts were
entitled upon their redemption and surrender thereof to the preferred stock
depositary.
Voting
Upon receipt of notice of any meeting at which the holders of a class or
series of preferred stock deposited with the preferred stock depositary are
entitled to vote, the preferred stock depositary will mail the information
contained in that notice of meeting to the record holders of the depositary
receipts evidencing the depositary shares which represent that class or series
of preferred stock. Each record holder of depositary receipts evidencing
depositary shares on the record date (which will be the same date as the record
date for that class or series of preferred stock) will be entitled to instruct
the preferred stock depositary as to the exercise of the voting rights
pertaining to the amount of preferred stock represented by that holder's
depositary shares. The preferred stock depositary will vote the amount of that
class or series of preferred stock represented by those depositary shares in
accordance with those instructions, and we will agree to take all reasonable
action which may be deemed necessary by the preferred stock depositary in order
to enable the preferred stock depositary to do so. The preferred stock
depositary will abstain from voting the amount of that class or series of
preferred stock represented by those depositary shares to the extent it does not
receive specific instructions from the holders of depositary receipts evidencing
those depositary shares. The preferred stock depositary shall not be responsible
for any failure to carry out any instruction to vote, or for the manner or
effect of any vote made, as long as that action or non-action is in good faith
and does not result from negligence or willful misconduct of the preferred stock
depositary.
Liquidation Preference
In the event of our liquidation, dissolution or winding up, whether
voluntary or involuntary, the holders of each depositary receipt will be
entitled to the fraction of the liquidation preference accorded each share of
preferred stock represented by the depositary shares evidenced by that
depositary receipt, as set forth in the applicable prospectus supplement.
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Conversion
The depositary shares will not be convertible directly into our common
stock or any other of our securities or property, except in connection with
exchanges to preserve our status as a REIT. Holders of depositary receipts
evidencing convertible preferred stock may surrender the depositary receipts to
the depositary with instructions directing us to convert the class or series of
preferred stock represented by the related depositary shares into whole shares
of common stock, other shares of a class or series of preferred stock or other
securities if specified in the prospectus supplement relating to the offering of
the depositary shares. When we receive these instructions, and the payment of
any applicable fees, we will convert or exchange the preferred stock using the
same procedures as we use for the delivery of preferred stock. If a holder is
converting only part of the depositary shares represented by a depositary
receipt, new depositary receipts will be issued for any depositary shares that
are not converted. We will not issue any fractional shares of our common stock
upon conversion, and if a conversion would result in a fractional share being
issued, we will pay in cash an amount equal to the value of the fractional
interest based upon the closing price of our common stock on the last business
day prior to the conversion.
Amendment and Termination of the Deposit Agreement
The form of depositary receipt evidencing the depositary shares which
represent the preferred stock and any provision of the deposit agreement may at
any time be amended by agreement between us and the preferred stock depositary.
However, any amendment that materially and adversely alters the rights of the
holders of depositary receipts or that would be materially and adversely
inconsistent with the rights granted to the holders of the related class or
series of preferred stock will not be effective unless that amendment has been
approved by the existing holders of at least two thirds of the depositary shares
evidenced by the depositary receipts then outstanding. No amendment shall impair
the right, subject to certain exceptions in the deposit agreement, of any holder
of depositary receipts to surrender any depositary receipt with instructions to
deliver to the holder the related class or series of preferred stock and all
money and other property, if any, represented thereby, except in order to comply
with law. Every holder of an outstanding depositary receipt at the time any of
those types of amendments becomes effective shall be deemed, by continuing to
hold that depositary receipt, to consent and agree to that amendment and to be
bound by the deposit agreement as amended thereby.
We may terminate the deposit agreement upon not less than 30 days' prior
written notice to the preferred stock depositary if:
o such termination is necessary to preserve our status as a REIT, or
o a majority of each class or series of preferred stock subject to that
deposit agreement consents to that termination, whereupon the
preferred stock depositary shall deliver or make available to each
holder of depositary receipts, upon surrender of the depositary
receipts held by that holder, that number of whole or fractional
shares of each class or series of preferred stock as are represented
by the depositary shares evidenced by those depositary receipts
together with any other property held by the preferred stock
depositary with respect to those depositary receipts.
If the deposit agreement is terminated to preserve our status as a REIT,
then we will use our best efforts to list each class or series of preferred
stock issued upon surrender of the related depositary shares on a national
securities exchange. In addition, the deposit agreement will automatically
terminate if:
o all outstanding depositary shares issued thereunder shall have been
redeemed,
o there shall have been a final distribution in respect of each class or
series of preferred stock subject to that deposit agreement in
connection with our liquidation, dissolution or winding up and that
distribution shall have been distributed to the holders of depositary
receipts evidencing the depositary shares representing that class or
series of preferred stock, or
o each share of preferred stock subject to that deposit agreement shall
have been converted into our stock not so represented by depositary
shares.
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Charges of Preferred Stock Depositary
We will pay all transfer and other taxes and governmental charges arising
solely from the existence of the deposit agreement. In addition, we will pay the
fees and expenses of the preferred stock depositary in connection with the
performance of its duties under the deposit agreement. However, holders of
depositary receipts will pay the fees and expenses of the preferred stock
depositary for any duties requested by those holders to be performed which are
outside of those expressly provided for in the deposit agreement.
Resignation and Removal of Preferred Stock Depositary
The preferred stock depositary may resign at any time by delivering notice
to us of its election to do so, and we may at any time remove the preferred
stock depositary, that resignation or removal to take effect upon the
appointment of a successor preferred stock depositary. A successor preferred
stock depositary must be appointed within 60 days after delivery of the notice
of resignation or removal and must be a bank or trust company having its
principal office in the United States and having a combined capital and surplus
of at least $50,000,000.
Miscellaneous
The preferred stock depositary will forward to holders of depositary
receipts any reports and communications from us which are received by it with
respect to the related preferred stock.
Neither we nor the preferred stock depositary will be liable if it is
prevented from or delayed in, by law or any circumstances beyond its control,
performing its obligations under the deposit agreement. Our obligations and
those of the preferred stock depositary under the deposit agreement will be
limited to performing our respective duties thereunder in good faith and without
negligence (in the case of any action or inaction in the voting of a class or
series of preferred stock represented by the depositary shares), gross
negligence or willful misconduct, and neither we nor the preferred stock
depositary will be obligated to prosecute or defend any legal proceeding in
respect of any depositary receipts, depositary shares or shares of a class or
series of preferred stock represented thereby unless satisfactory indemnity is
furnished. We and the preferred stock depositary may rely on written advice of
counsel or accountants, or information provided by persons presenting shares of
a class or series of preferred stock represented thereby for deposit, holders of
depositary receipts or other persons believed in good faith to be competent to
give that information, and on documents believed in good faith to be genuine and
signed by a proper party.
In the event the preferred stock depositary shall receive conflicting
claims, requests or instructions from any holders of depositary receipts, on the
one hand, and us, on the other hand, the preferred stock depositary shall be
entitled to act on those claims, requests or instructions received from us.
DESCRIPTION OF DEBT SECURITIES
General
We may issue debt securities under an indenture between us and SunTrust
Bank, Inc., as the indenture trustee. The indenture will be subject to, and
governed by, the Trust Indenture Act of 1939, as amended, and we may supplement
the indenture from time to time after we execute it.
This prospectus summarizes what we believe to be the material provisions of
the indenture and the debt securities that we may issue under the indenture.
This summary is not complete and may not describe all of the provisions of the
indenture or of any of the debt securities that might be important to you. For
additional information, you should carefully read the form of indenture that is
incorporated by reference as an exhibit to the registration statement of which
this prospectus forms a part.
When we offer to sell a particular series of debt securities, we will
describe the specific terms of those debt securities in a supplement to this
prospectus. We will also indicate in the supplement whether the general terms in
this prospectus apply to a particular series of debt securities. Accordingly,
for a description of the terms of a particular issue of debt securities, you
should carefully read both this prospectus and the applicable supplement.
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In the summary below, we have included references to the section numbers of
the indenture so that you can easily locate the related provisions in the
indenture for additional detail. You should also refer to the indenture for the
definitions of any capitalized terms that we use below but do not describe in
this prospectus. When we refer to particular sections of the indenture or to
defined terms in the indenture, we intend to incorporate by reference those
sections and defined terms into this prospectus.
Terms
The debt securities will be our direct, unsecured obligations. The
indebtedness represented by the debt securities will rank equally with all of
our other unsecured and unsubordinated debt. We may, as described in a
prospectus supplement, issue debt that is secured by our assets.
The amount of debt securities we offer under this prospectus will be
limited to the amount described on the cover of this prospectus. We may issue
the debt securities, from time to time and in one or more series, as our board
of directors may establish by resolution, or as we may establish in one or more
supplemental indentures. We may issue debt securities with terms different from
those of debt securities that we have previously issued (Section 301).
The indenture provides that there may be more than one trustee under the
indenture, each with respect to one or more series of debt securities. Any
trustee under the indenture may resign or be removed with respect to one or more
series of debt securities, and a successor trustee may be appointed to act with
respect to that series (Section 608). If two or more persons act as trustee with
respect to different series of debt securities, each trustee shall be a trustee
of a trust under the indenture separate and apart from the trust administered by
any other trustee (Sections 101 and 609). Except as otherwise indicated in this
prospectus, each trustee may take any action described in this prospectus only
with respect to the one or more series of debt securities for which it is
trustee under the indenture.
You should refer to the applicable supplement to this prospectus relating
to a particular series of debt securities for the specific terms of the debt
securities, including, but not limited to:
o the title of the debt securities, whether the debt securities will be
guaranteed and the identity of the guarantor or guarantors, if any;
o the total principal amount of the debt securities and any limit on the
total principal amount;
o the price, expressed as a percentage of the principal amount of the
debt securities, at which we will issue the debt securities and any
portion of the principal amount payable upon acceleration of the debt
securities;
o the terms, if any, by which holders of the debt securities may convert
or exchange the debt securities for our common stock, our preferred
stock, or any of our other securities or property;
o if the debt securities are convertible or exchangeable, any
limitations on the ownership or transferability of the securities or
property into which holders may convert or exchange the debt
securities;
o the date or dates, or the method for determining the date or dates, on
which we will be obligated to pay the principal of the debt securities
and the amount of principal we will be obligated to pay;
o the rate or rates, which may be fixed or variable, at which the debt
securities of the series will bear interest, if any, or the method by
which the rate or rates will be determined;
o the date or dates, or the method for determining the date or dates,
from which any interest will accrue on the debt securities, the dates
on which we will be obligated to pay any interest, the regular record
dates, if any, for the interest payments, or the method by which the
dates will be determined, the persons to whom we will be obligated to
pay interest, and the basis upon which interest will be calculated, if
other than that of a 360-day year consisting of twelve 30-day months;
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o the place or places where the principal of, and any premium,
Make-Whole Amount, interest or Additional Amounts on, the debt
securities will be payable, where the holders of the debt securities
may surrender their debt securities for conversion, transfer or
exchange, and where the holders may serve notices or demands to us in
respect of the debt securities and the indenture (Section 101);
o whether the debt securities will be in registered or bearer form, and
the terms and conditions relating to the form, and, if in registered
form, the denominations in which we will issue the debt securities if
other than $1,000 or a multiple of $1,000 and, if in bearer form, the
denominations in which we will issue the debt securities if other than
$5,000;
o if other than the trustee, the identity of each security registrar
and/or paying agent for debt securities of the series;
o the period or periods during which, the price or prices, including any
premium or Make-Whole Amount, at which, the currency or currencies in
which, and the other terms and conditions upon which, we may redeem
the debt securities, at our option, if we have an option;
o any obligation that we have to redeem, repay or purchase debt
securities under any sinking fund or similar provision or at the
option of a holder of debt securities, and the terms and conditions
upon which we will redeem, repay or purchase all or a portion of the
debt securities under that obligation;
o the currency or currencies in which we will sell the debt securities
and in which the debt securities will be denominated and payable;
o whether the amount of payment of principal of, and any premium,
Make-Whole Amount or interest on, the debt securities of the series
may be determined with reference to an index, formula or other method
and the manner in which the amounts will be determined;
o whether the principal of, and any premium, Make-Whole Amount,
Additional Amounts or interest on, the debt securities of the series
are to be payable, at our election or at the election of a holder of
the debt securities, in a currency or currencies other than that in
which the debt securities are denominated or stated to be payable, the
period or periods during which, and the terms and conditions upon
which, this election may be made, and the time and manner of, and
identity of the exchange rate agent responsible for, determining the
exchange rate between the currency or currencies in which the debt
securities are denominated or stated to be payable and the currency or
currencies in which the debt securities will be payable;
o any provisions granting special rights to the holders of the debt
securities of the series at the occurrence of named events;
o any additions to, modifications of or deletions from the terms of the
debt securities with respect to the events of default or covenants
contained in the indenture;
o whether the debt securities of the series will be issued in
certificated or book-entry form and the related terms and conditions,
including whether any debt securities will be issued in temporary
and/or permanent global form, and if so, whether the owners of
interests in any permanent global debt security may exchange those
interests for debt securities of that series and of like tenor of any
authorized form and denomination and the circumstances under which any
exchanges may occur, if other than in the manner provided in the
indenture (Section 305), and, if debt securities of or within the
series are to be issuable as a global debt security, the identity of
the depositary for such series;
o the date as of which any Bearer Securities, and/or temporary global
debt security representing outstanding securities of or within the
series will be dated if other than the date of original issuance of
the first debt security of the series to be issued (Section 101);
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o if the debt securities will be issued in definitive form only upon our
receipt, or the trustee's receipt, of certificates or other documents,
or upon the satisfaction of conditions, a description of those
certificates, documents or conditions;
o if the debt securities will be issued upon the exercise of debt
warrants, the time, manner and place for the debt securities to be
authenticated and delivered;
o the applicability, if any, of the defeasance and covenant defeasance
provisions of the indenture, as described below under "--Discharge,
Defeasance and Covenant Defeasance";
o any applicable United States federal income tax consequences,
including whether and under what circumstances we will pay any
Additional Amounts, as contemplated in the indenture on the debt
securities, to any holder who is not a United States person in respect
of any tax, assessment or governmental charge withheld or deducted
and, if we will pay Additional Amounts, whether, and on what terms, we
will have the option to redeem the debt securities in lieu of paying
the Additional Amounts;
o any other covenant or warranty included for the benefit of the debt
securities of the series;
o any proposed listing of the debt securities on any securities exchange
or market; and
o any other terms of the debt securities or of any guarantees issued in
connection with the debt securities not inconsistent with the
provisions of the indenture (Section 301).
The debt securities may provide for less than their entire principal amount
to be payable if we accelerate their maturity as a result of the occurrence and
continuation of an event of default (Section 502). If this is the case, the debt
securities would have what is referred to as "original interest discount." Any
special United States federal income tax, accounting and other considerations
applicable to original issue discount securities will be described in the
applicable prospectus supplement.
We may issue debt securities from time to time, with the principal amount
payable on any principal payment date, or the amount of interest payable on any
interest payment date, to be determined by reference to one or more currencies
or currency exchange rates, commodity prices, equity indices or other factors.
Holders of debt securities with these features may receive a principal amount on
any principal payment date, or a payment of interest on any interest payment
date, that is greater than or less than the amount of principal or interest
otherwise payable on the applicable dates, depending upon the value on those
dates of the applicable currencies or currency exchange rates, commodity prices,
equity indices or other factors.
Information as to the methods for determining the amount of principal or
interest payable on any date, the currencies or currency exchange rates,
commodity prices, equity indices or other factors to which the amount payable on
that date is linked and additional tax considerations will be included in the
applicable prospectus supplement. All debt securities of any one series will be
substantially identical, except as to denomination, in the case of debt
securities issued in global form, and except as may otherwise be provided by a
resolution of our board of directors or in any supplement to the indenture. We
are not required to issue all of the debt securities of a series at the same
time, and, unless otherwise provided in the indenture or applicable supplement,
we may re-open a series without the consent of the holders of the debt
securities of that series to issue additional debt securities of that series.
The indenture does not contain any provisions that limit our ability to
incur indebtedness or that would protect holders of debt securities in the event
we become a party to a highly-leveraged or similar transaction in which we would
incur or acquire a large amount of additional debt. However, there are
restrictions on ownership and transfers of our common stock and preferred stock
that are designed to preserve our status as a REIT, as well as other provisions
of our charter and bylaws, which may prevent or hinder a change of control. You
should refer to the applicable prospectus supplement for information regarding
any deletions from, modifications of, or additions to the events of default or
covenants that are described below, including any addition of a covenant or
other provision providing event risk or similar protection.
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Guarantees
Debt securities may be issued and unconditionally and irrevocably
guaranteed on an unsecured and unsubordinated basis by certain of our
subsidiaries that are listed as guarantors in the applicable supplement to this
prospectus. Any guarantee would cover the timely payment of the principal of,
and any premium, interest or sinking fund payments on, the debt securities,
whether we make the payment at a maturity date, as a result of acceleration or
redemption, or otherwise. We will more fully describe the existence and terms of
any guarantee of any of our debt securities by our subsidiaries in the
prospectus supplement relating to those debt securities.
Denominations, Interest, Registration and Transfer
Unless the applicable prospectus supplement states otherwise, any debt
securities of any series that we issue in registered form will be issued in
denominations of $1,000 and multiples of $1,000, and debt securities of any
series that we issue in bearer form will be issued in denominations of $5,000
(Section 302).
Unless the applicable prospectus supplement states otherwise, the principal
of, and any premium, Make-Whole Amount, or interest on, any series of debt
securities will be payable in the currency designated in the prospectus
supplement at the corporate trust office of the trustee, initially, SunTrust
Bank, 25 Park Place, 24th Floor, Atlanta, Georgia 30303-2900. At our option,
however, payment of interest may be made by check mailed to the address of the
person entitled to the interest payment as it appears in the security register
for the series or by wire transfer of funds to that person at an account
maintained within the United States (Sections 301, 305, 307 and 1002). We may at
any time designate additional paying agents or rescind designation of any paying
agents or approve a change in the office through which any paying agent acts,
except that we will be required to maintain a paying agent in each place of
payment for any series. All monies that we pay to a paying agent for the payment
of any principal of, or any premium, Make-Whole Amount, interest or Additional
Amounts on, any debt security which remains unclaimed at the end of two years
after that payment became due and payable will be repaid to us. After that time,
the holder of the debt security will be able to look only to us for payment
(Section 1003).
Any interest that we do not punctually pay on any interest payment date
with respect to a debt security will cease to be payable to the holder on the
applicable regular record date and may either:
o be paid to the holder at the close of business on a Special Record
Date for the payment of defaulted interest, to be determined by the
trustee, (Sections 101 and 307); or
o be paid at any time in any other lawful manner, as more fully
described in the indenture.
Subject to certain limitations imposed upon debt securities issued in
book-entry form, debt securities of any series will be exchangeable for other
debt securities of the same series and of the same total principal amount and
authorized denomination upon the surrender of the debt securities at the
corporate trust office of the trustee. In addition, subject to certain
limitations imposed upon debt securities issued in book-entry form, the debt
securities of any series may be surrendered for conversion, transfer or exchange
at the corporate trust office of the trustee. Every debt security surrendered
for conversion, transfer or exchange must be duly endorsed or accompanied by a
written instrument of transfer. There will be no service charge for any transfer
or exchange of any debt securities, but we may require holders to pay any tax or
other governmental charge payable in connection with the transfer or exchange
(Section 305).
If the applicable prospectus supplement refers to us designating any
transfer agent for any series of debt securities, in addition to the trustee, we
may at any time remove the transfer agent or approve a change in the location at
which the transfer agent acts, except that we will be required to maintain a
transfer agent in each place of payment for any series of debt securities. We
may at any time designate additional transfer agents with respect to any series
of debt securities (Section 1002).
Neither we nor any trustee will be required to do any of the following:
o issue, register the transfer of or exchange debt securities of any
series during a period beginning at the opening of business 15 days
before there is a selection of debt securities of that series to be
redeemed
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and ending at the close of business on the day of mailing or
publication of the relevant notice of redemption;
o register the transfer of or exchange any debt security, or portion
thereof, called for redemption, except the unredeemed portion of any
debt security being only partially redeemed;
o exchange any debt security in bearer form that is selected for
redemption, except that a debt security in bearer form may be
exchanged for a debt security in registered form of that series and
like denomination, provided that the debt security in registered form
must be simultaneously surrendered for redemption; or
o issue or register the transfer or exchange of any debt security that
has been surrendered for repayment at the option of the holder, except
the portion, if any, of the debt security that will not be partially
or entirely repaid (Section 305).
Global Debt Securities
The debt securities of a series may be issued in the form of one or more
fully registered global securities that will be deposited with a depositary or
with a nominee for a depositary identified in the prospectus supplement relating
to the series and registered in the name of the depositary or its nominee. In
this case, we will issue one or more global securities in a denomination or
total denominations equal to the portion of the total principal amount of
outstanding registered debt securities of the series to be represented by the
global security or securities. We expect that any global securities issued in
the United States would be deposited with The Depository Trust Company, as
depositary. We may issue any global securities in fully registered form on a
temporary or permanent basis. Unless and until a global security is exchanged
for debt securities in definitive registered form, a permanent global security
may not be transferred except as a whole by the depositary to its nominee or by
a nominee to the depositary or another nominee, or by the depositary or its
nominee to a successor of the depositary or the successor depositary's nominee.
The specific terms of the depositary arrangement with respect to any series
of debt securities to be represented by a registered global security will be
described in the applicable prospectus supplement. We anticipate that the
following provisions will apply to depositary arrangements.
Ownership of beneficial interests in a global security will be limited to
persons that have accounts with, or are participants of, the depositary for the
registered global security, or persons that may hold interests through
participants. When we issue a registered global security, the depositary will
credit, on its book-entry registration and transfer system, the participants'
accounts with the respective principal amounts of the debt securities
represented by the global security owned by those participants. The accounts to
be credited will be designated by any dealers, underwriters or agents
participating in an offering of the debt securities, or by us or the trustee if
we are directly offering the debt securities. The participants' ownership, and
any transfer, of a registered global security will be shown on records
maintained by the depositary, and ownership of persons who hold debt securities
through participants will be reflected on the records of the participants. State
and federal laws may impair a person's ability to own, transfer or pledge
interests in a registered global securities.
So long as the depositary or its nominee is the registered owner of the
global security, the depositary or its nominee, as the case may be, will be
considered the sole owner or holder of the debt securities represented by the
global security for all purposes under the indenture. Except as set forth below,
owners of beneficial interests in a global security will not be entitled to have
the debt securities represented by the registered global security registered in
their names, will not receive or be entitled to receive physical delivery of the
debt securities in definitive form, and will not be considered the owners or
holders of the debt securities under the indenture. Accordingly, each person
owning a beneficial interest in a registered global security must rely on the
depositary's procedures and, if that person is not a participant, on the
procedures of the participant through which that person owns its interest, to
exercise any rights of a holder under the indenture. We understand that under
existing industry practices, if we request any action of holders or if an owner
of a beneficial interest in a registered global security desires to give or take
any action which a holder is entitled to give or take under the indenture, the
depositary would authorize the participants holding the relevant beneficial
interests to give or take the action, and the participants would authorize
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beneficial owners owning through those participants to give or take the action
or would otherwise act upon the instructions of beneficial owners holding
through them.
Payments of principal of, and any premium, Make-Whole Amount, interest or
Additional Amounts on, a registered global security will be made to the
depositary or its nominee, as the case may be, as the registered owners of the
global security. Neither we, the trustee, the paying agent nor the registrar,
nor any other agent of ours or of the trustee, will have any responsibility or
liability for any aspect of the records relating to, or payments made on account
of, beneficial ownership interests in the global security or for maintaining,
supervising or reviewing any records relating to the beneficial ownership
interests.
We expect that once the depositary receives any payment of principal of,
any premium, Make-Whole Amounts, interest or Additional Amount on, a registered
global security, the depositary will immediately credit participants' accounts
with payments in amounts proportionate to their respective beneficial interests
in the global security, as shown on the records of the depositary. We also
expect that payments by participants to owners of beneficial interests in the
registered global security held through the participants will be governed by
standing customer instructions and customary practices, as is now the case with
the securities held for the accounts of customers in bearer form or registered
in "street name," and will be the responsibility of the participants.
If the depositary is at any time unwilling or unable to continue as
depositary or ceases to be a clearing agency under the Securities Exchange Act
of 1934, as amended, and we do not appoint a successor depositary within 90
days, we will issue debt securities in definitive form in exchange for the
registered global security. In addition, we may at any time and in our sole
discretion decide not to have any of the debt securities of a series represented
by one or more global securities and, in such event, we will issue debt
securities in definitive form in exchange for all of the global security or
securities representing the debt securities. We will register any debt
securities issued in definitive form in exchange for a global security in the
name or names that the depositary provides to the trustee. We expect that those
names will be based upon directions received by the depositary from participants
with respect to ownership of beneficial interests in the global security.
Debt securities in bearer form may also be issued in the form of one or
more global securities that will be deposited with a common depositary for
Euroclear and CEDEL, or with a nominee for the depositary identified in the
applicable prospectus supplement. We will describe in the applicable prospectus
supplement the specific terms and procedures of the depositary arrangement,
including the specific terms of the depositary arrangement and any specific
procedures, for the issuance of debt securities in definitive form in exchange
for a global security in bearer form, with respect to any portion of a series of
debt securities to be represented by a global security in bearer form.
Merger, Consolidation or Sale
We may consolidate with, or sell, lease or convey all or substantially all
of our assets to, or merge with or into, any other corporation, trust or entity
provided that:
o we are the survivor in the transaction, or the survivor, if not us, is
an entity organized under the laws of the United States or a state of
the United States which expressly assumes by supplemental indenture
the due and punctual payment of the principal of, and any premium,
Make-Whole Amount, interest and Additional Amounts on, all of the
outstanding debt securities and the due and punctual performance and
observance of all of the covenants and conditions contained in the
indenture;
o immediately after giving effect to the transaction and treating any
indebtedness that becomes an obligation of ours or one of our
subsidiaries as a result of the transaction as having been incurred by
us or our subsidiary at the time of the transaction, there is no event
of default under the indenture, and no event which, after notice or
the lapse of time, or both, would become an event of default; and
o we deliver a certificate, signed by one of our officers, and an
opinion of our legal counsel, as to the satisfaction of conditions
contained in the indenture (Sections 801 and 803).
This covenant would not apply to any recapitalization transaction, a change of
control of us or a transaction in which we incur a large amount of additional
debt unless the transactions or change of control included a merger,
consolidation or transfer or lease of substantially all of our assets. Except as
may be described in the applicable prospectus
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supplement, there are no covenants or other provisions in the indenture
providing for a "put" right or increased interest or that would otherwise afford
holders of debt securities additional protection in the event of a
recapitalization transaction, a change of control of us or a transaction in
which we incur a large amount of additional debt.
Certain Covenants
Existence. Except as permitted under the section entitled "--Merger,
Consolidation or Sale" above, we will do or cause to be done all things
necessary to preserve and keep our and our Subsidiaries' legal existence, rights
and franchises in full force and effect. We will not, however, be required to
preserve any right or franchise if we determine that the preservation of that
right or franchise is no longer desirable in the conduct of our business and
that its loss is not disadvantageous in any material respect to the holders of
any debt securities (Section 1005).
Maintenance of Properties. We will cause all of our material properties
used or useful in the conduct of our business, or the business of any of our
subsidiaries, to be maintained and kept in good condition, repair and working
order and supplied with all necessary equipment. We will also cause to be made
all necessary repairs, renewals, replacements, betterments and improvements of
those properties, as we in our judgment believe is necessary to properly and
advantageously carry on the business related to those properties at all times.
We will not, however, be prevented from selling or otherwise disposing of our
properties, or the properties of our subsidiaries, in the ordinary course of
business (Section 1006).
Insurance. We and each of our subsidiaries must keep all of our insurable
properties insured against loss or damage with commercially reasonable amounts
and types of insurance provided by insurers of recognized responsibility
(Section 1007).
Payment of Taxes and Other Claims
We will pay or discharge, or cause to be paid or discharged, before
they become delinquent, the following:
o all taxes, assessments and governmental charges levied or imposed upon
us or any of our subsidiaries, or upon the income, profits or property
of us or of any of our subsidiaries, and
o all lawful claims for labor, materials and supplies which, if unpaid,
might by law become a lien upon our property or the property of any of
our subsidiaries.
We will not, however, be required to pay or discharge, or cause to be paid
or discharged, any tax, assessment, charge or claim the amount, applicability or
validity of which is being contested in good faith by appropriate proceedings
(Section 1008).
Provision of Financial Information. Whether or not we are subject to
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, or the
Exchange Act, we will file annual reports, quarterly reports and other documents
with the SEC pursuant to Sections 13 and 15(d) as if we were so subject, on or
prior to the dates by which we are or would have been required to file those
documents if we were so subject. In any event, we will:
o file with the applicable trustee copies of the annual reports,
quarterly reports and other documents that we are or would be required
to file with the SEC under Sections 13 and 15(d) of the Exchange Act
within 15 days of each of the respective dates by which we are or
would have been required to file those reports with the SEC; and
o promptly upon written request and payment of the reasonable cost of
duplication and delivery, supply copies of those documents to holders
and any prospective holders of debt securities if filing those
documents with the SEC is not permitted under the Exchange Act
(Section 1009).
Waiver of Certain Covenants. We may choose not to comply with any term,
provision or condition of the foregoing covenants, or with any other term,
provision or condition with respect to the debt securities of a series if,
before or after the time for compliance, the holders of at least a majority in
principal amount of all outstanding debt securities of the series either waive
the compliance in that particular instance or in general waive compliance with
25
that covenant or condition. This does not apply to any terms, provisions or
conditions that, by their terms, cannot be amended without the consent of all
holders of debt securities of the series. Unless the holders expressly waive
compliance with a covenant and the waiver has become effective, our obligations
and the duties of the trustee in respect of any term, provision or condition
will remain in full force and effect (Section 1012).
Additional Covenants.
Any additional covenants with respect to any series of debt securities will
be described in the applicable prospectus supplement.
Events of Default, Notice and Waiver
Except as otherwise provided in the applicable prospectus supplement, the
following events are "events of default" with respect to any series of debt
securities that we may issue under the indenture:
o we fail for 30 days to pay any installment of interest or any
Additional Amounts payable on any debt security of that series;
o we fail to pay the principal of, or any premium or Make-Whole Amount
on, any debt security of that series when due, either at maturity,
redemption or otherwise;
o we fail to make any sinking fund payment as required for any debt
security of that series;
o we breach or fail to perform any covenant or warranty contained in the
indenture, other than a covenant added solely for the benefit of a
different series of debt securities issued under the indenture or
except as otherwise provided for in the indenture, and our breach or
failure to perform continues for 60 days after we have received
written notice in accordance with the indenture of our breach or
failure to perform;
o we default under a bond, debenture, note, mortgage, indenture or
instrument evidencing indebtedness for money borrowed by us, or by any
subsidiaries of ours that we have guaranteed or for which we are
directly responsible or liable as obligor or guarantor, that has a
principal amount outstanding of $10,000,000 or more, other than
indebtedness which is non-recourse to us or our subsidiaries, which
default has caused the indebtedness to become due and payable earlier
than it would otherwise have become due and payable, and the
indebtedness has not been discharged or the acceleration has not been
rescinded or annulled, within 30 days after written notice was
provided to us in accordance with the indenture;
o the bankruptcy, insolvency or reorganization or court appointment of a
receiver, liquidator or appointment of a trustee for us or of any of
our Significant Subsidiaries, or for all or substantially all of our
properties or the properties of our Significant Subsidiaries (Section
101); and
o any other event of default described in the applicable prospectus
supplement and indenture (Section 501).
If there is a continuing event of default with respect to outstanding debt
securities of a series, then the trustee or the holders of not less than 25% in
aggregate principal amount of the outstanding debt securities of that series,
voting as a single class, may declare immediately due and payable the principal
amount or other amount as may be specified by the terms of those debt securities
and any premium or Make-Whole Amount on the debt securities of that series.
However, at any time after an acceleration with respect to debt securities of a
series has been made, but before a judgment or decree for payment of the money
due has been obtained by the trustee, the holders of not less than a majority in
principal amount of the outstanding debt securities of that series may cancel
the acceleration and annul its consequences if:
o we pay or deposit with the trustee all required payments of the
principal of, and any premium, Make-Whole Amount, interest, and
Additional Amounts on, the applicable series of debt securities, plus
fees, expenses, disbursements and advances of the trustee; and
26
o all events of default, other than the nonpayment of accelerated
principal, premium, Make-Whole Amount or interest, with respect to the
applicable series of debt securities have been cured or waived as
provided in the indenture (Section 502).
The indenture also provides that the holders of not less than a majority in
principal amount of the outstanding debt securities of any series may waive any
past default with respect to that series and its consequences, except a default
involving:
o our failure to pay the principal of, and any premium, Make-Whole
Amount, interest or Additional Amounts on, any debt security; or
o a covenant or provision contained in the indenture that cannot be
modified or amended without the consent of the holders of each
outstanding debt security affected by the default (Section 513).
The trustee is generally required to give notice to the holders of debt
securities of each affected series within 90 days of a default actually known to
a Responsible Officer of the Trustee unless the default has been cured or
waived. The trustee may, however, withhold notice of default unless the default
relates to:
o our failure to pay the principal of, and any premium, Make-Whole
Amount, interest or Additional Amounts on, any debt security of that
series; or
o any sinking fund installment for any debt securities of that series,
if the Responsible Officers of the trustee in good faith consider it to be in
the interest of the holders of the debt securities of that series (Sections 101
and 601).
The indenture provides that no holder of debt securities of any series may
institute a proceeding with respect to the indenture or for any remedy under the
indenture, unless the trustee fails to act, for 60 days, after it has received a
written notice of a continuing event of default with respect to the debt
securities of that series from such holder and a written request to institute
proceedings in respect of an event of default from the holders of not less than
25% in principal amount of the outstanding debt securities of that series, as
well as an offer of indemnity satisfactory to the trustee; provided no direction
inconsistent with such request has been given to the trustee during such 60-day
period by the holders of a majority in principal amount of outstanding debt
securities of that series (Section 507). This provision will not prevent,
however, any holder of debt securities from instituting suit for the enforcement
of payment of the principal of, and any premium, Make-Whole Amount, interest or
Additional Amounts on, the debt securities at their respective due dates
(Section 508).
Subject to provisions in the indenture relating to the trustee's duties in
case of default, the trustee is not under an obligation to exercise any of its
rights or powers under the indenture at the request or direction of any holders
of any series of debt securities then outstanding, unless the holders have
offered to the trustee security or indemnity satisfactory to it (Section 602).
Subject to these provisions for the indemnification of the trustee, the holders
of not less than a majority in principal amount of the outstanding debt
securities of any series will have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the trustee, or
of exercising any trust or power conferred upon the trustee. The trustee may,
however, refuse to follow any direction which conflicts with any law or the
indenture, which may involve the trustee in personal liability or which may be
unduly prejudicial to the holders of debt securities of the applicable series
not joining in the direction (Section 512).
Within 120 days after the close of each fiscal year, we must deliver to the
trustee a certificate, signed by one of several specified officers, stating that
officer's knowledge of our compliance with all the conditions and covenants
under the indenture, and, in the event of any noncompliance, specifying the
noncompliance and the nature and status of the noncompliance (Section 1010).
Modification of the Indenture
The holders of not less than a majority in principal amount of all
outstanding debt securities issued under the indenture must consent to any
modifications and amendments of the indenture. However, no modification or
27
amendment may, without the consent of each holder of the outstanding debt
securities affected, do any of the following:
o change the stated maturity of the principal of, or any premium,
Make-Whole Amount or installment of principal of, or interest on, any
debt security;
o reduce the principal amount of, or the rate or amount of interest on,
any premium or Make-Whole Amount payable on redemption of, or any
Additional Amounts payable with respect to, any debt security or
change any obligation to pay Additional Amounts except as permitted by
the indenture;
o reduce the amount of principal of an original issue discount security
or any Make-Whole Amount that would be due and payable upon
declaration of acceleration of the maturity of the original discount
or other security, or would be provable in bankruptcy, or adversely
affect any right of repayment of the holder of any debt security;
o change the place of payment or the currency or currencies of payment
of the principal of, and any premium, Make-Whole Amount, interest, or
Additional Amounts on, any debt security;
o impair the right to institute suit for the enforcement of any payment
on or with respect to any debt security;
o reduce the percentage of the holders of outstanding debt securities of
any series necessary to modify or amend the indenture, to waive
compliance with provisions of the indenture or defaults and their
consequences under the indenture, or to reduce the quorum or voting
requirements contained in the indenture;
o make any change that adversely affects the right to convert or
exchange any debt security other than as permitted by the indenture or
decrease the conversion or exchange rate or increase the conversion or
exchange price of any such debt security; or
o modify any of the foregoing provisions or any of the provisions
relating to the waiver of past defaults or covenants, except to
increase the required percentage of holders necessary to effect that
action or to provide that other provisions may not be modified or
waived without the consent of the holder of the debt security (Section
902).
The holders of not less than a majority in principal amount of outstanding
debt securities have the right to waive compliance by us with some of the
covenants in the indenture (Section 1012). We and the trustee may modify or
amend an indenture, without the consent of any holder of debt securities, for
any of the following purposes:
o to evidence the succession of another person to us as obligor under
the indenture;
o to add to our existing covenants additional covenants for the benefit
of the holders of all or any series of debt securities, or to
surrender any right or power conferred upon us in the indenture;
o to add events of default for the benefit of the holders of all or any
series of debt securities;
o to add or change any provisions of the indenture to facilitate the
issuance of, or to liberalize the terms of, debt securities in bearer
form, or to permit or facilitate the issuance of debt securities in
uncertificated form, provided that this action will not adversely
affect the interests of the holders of the debt securities of any
series in any material respect;
o to add, change or eliminate any provisions of the indenture, provided
that any addition, change or elimination shall neither apply to any
debt security of any series created prior to the execution of such
supplemental indenture and entitled to the benefit of such provision
nor modify the rights of the holder of any debt security with respect
to such provision or become effective only when there are no
outstanding debt securities;
28
o to secure the debt securities;
o to establish the form or terms of debt securities of any series,
including the provisions and procedures, if applicable, for the
conversion or exchange of the debt securities into our common stock,
preferred stock or other securities or property;
o to evidence and provide for the acceptance or appointment of a
successor trustee or facilitate the administration of the trusts under
the indenture by more than one trustee;
o to make any provision with respect to the conversion or exchange of
rights of holders pursuant to the requirements of the indenture;
o to cure any ambiguity, defect or inconsistency in the indenture,
provided that the action does not adversely affect the interests of
holders of debt securities of any series issued under that indenture;
o to close the indenture with respect to the authentication and delivery
of additional series of debt securities or to qualify, or maintain
qualification of, the indenture under the Trust Indenture Act; or
o to supplement any of the provisions of the indenture to the extent
necessary to permit or facilitate defeasance and discharge of any
series of debt securities, provided that the action shall not
adversely affect the interests of the holders of the debt securities
of any series in any material respect (Section 901).
Discharge, Defeasance and Covenant Defeasance
Unless the terms of a series of debt securities provide otherwise, under
the indenture, we may discharge some of our obligations to holders of any series
of debt securities that:
o have not already been delivered to the trustee for cancellation and
that either have become due and payable or will become due and payable
within one year; or
o are scheduled for redemption within one year.
We can discharge these obligations by irrevocably depositing with the
trustee funds in the currency or currencies in which the debt securities are
payable in an amount sufficient to pay and discharge the entire indebtedness on
those debt securities, including principal of, and any premium, Make-Whole
Amount, interest and Additional Amounts on, the debt securities on and up to the
date of such deposit, or, if the debt securities have become due and payable, on
and up to the stated maturity or redemption date, as the case may be (Section
401).
In addition, if the terms of the debt securities of a series permit us to
do so, we may elect either of the following:
o to defease and be discharged from any and all obligations with respect
to the debt securities, except our obligations to (Section 1402):
-- pay any Additional Amounts upon the occurrence of several
particular tax and other events;
-- register the transfer or exchange of the debt securities;
-- replace temporary or mutilated, destroyed, lost or stolen debt
securities;
-- maintain an office or agency for the debt securities; and
-- hold monies for payment in trust; or
o to be released from our obligations with respect to the debt
securities under sections of the indenture described under "-- Certain
Covenants" or, if permitted by the terms of the debt securities, our
obligations with respect to any other covenant.
29
If we choose to be released from our obligations under the covenants, our
failure to comply with any of the obligations imposed on us by the covenants
will not constitute a default or an event of default with respect to the debt
securities (Section 1403). However, to make either election, we must irrevocably
deposit with the trustee an amount, in such currency or currencies in which the
debt securities are payable at stated maturity, or in Government Obligations
(Section 101), or both, that will provide sufficient funds to pay the principal
of, and any premium, Make-Whole Amount, interest and Additional Amounts on, the
debt securities, and any mandatory sinking fund or similar payments on the debt
securities, on the relevant scheduled due dates.
We may defease and discharge our obligations, as described in the preceding
paragraphs, only if, among other things, we have delivered to the trustee an
opinion of counsel to the effect that:
o the holders of the debt securities will not recognize income, gain or
loss for United States federal income tax purposes as a result of the
defeasance or covenant defeasance described in the previous paragraphs
and will be subject to United States federal income tax on the same
amounts, in the same manner and at the same times as would have been
the case if the defeasance or covenant defeasance had not occurred;
and
o in the case of defeasance, the opinion of counsel must refer to, and
be based upon, a ruling of the Internal Revenue Service or a change in
applicable United States federal income tax laws occurring after the
date of the indenture (Section 1404);
Unless otherwise provided in the applicable prospectus supplement, if,
after we have deposited funds and/or Government Obligations to effect defeasance
or covenant defeasance with respect to debt securities of any series:
o the holder of a debt security of the series elects to receive payment
in a currency other than that in which the deposit has been made in
respect of the debt security (Section 301); or
o a conversion event, as defined below, occurs in respect of the
currency in which the deposit has been made;
then the indebtedness represented by the debt security will be fully discharged
and satisfied through the payment of the principal of, and any premium,
Make-Whole Amount and interest on, the debt security as they become due, and
Additional Amounts, if any, out of the proceeds yielded by converting the amount
deposited in respect of the debt security into the currency in which the debt
security becomes payable as a result of the holder's election or the conversion
event based on the applicable market exchange rate (Section 1405).
Unless otherwise provided in the applicable prospectus supplement, a
"conversion event" means the cessation of use of:
o a currency issued by the government of one or more countries other
than the United States, both by the government of the country that
issued that currency and for the settlement of transactions by a
central bank or other public institutions of or within the
international banking community;
o the European Community, both within the European Monetary System and,
for the settlement of transactions, by public institutions of or
within the European Community; or
o any currency for the purposes for which it was established (Section
101).
Unless otherwise provided in the applicable prospectus supplement, we will
make all payments of principal of, and any premium, Make-Whole Amount, interest
and Additional Amounts on, any debt security that is payable in a foreign
currency that ceases to be used by its government of issuance in United States
dollars.
In the event that we effect covenant defeasance with respect to any debt
securities and the debt securities are declared due and payable because of the
occurrence of an event of default other than:
30
o the event of default described in the fourth bullet under "-- Events
of Default, Notice and Waiver," which would no longer be applicable to
the debt securities of that series (Sections 1004 to 1009); or
o the event of default described in the seventh bullet under "-- Events
of Default, Notice and Waiver" with respect to a covenant as to which
there has been covenant defeasance;
then the amount on deposit with the trustee will still be sufficient to pay
amounts due on the debt securities at the time of their stated maturity but may
not be sufficient to pay amounts due on the debt securities at the time of the
acceleration resulting from the event of default. In this case, we would remain
liable to make payment of the amounts due at the time of acceleration.
The applicable prospectus supplement may describe any additional provisions
permitting defeasance or covenant defeasance, including any modifications to the
provisions described above, with respect to a particular series of debt
securities.
Conversion and Exchange Rights
The terms on which debt securities of any series are convertible into or
exchangeable for our common stock, preferred stock or other securities or
property will be described in the applicable prospectus supplement. These terms
will include:
o the conversion or exchange price, or the manner of calculating the
price;
o the exchange or conversion period;
o whether the conversion or exchange is mandatory, or voluntary at the
option of the holder or at our option;
o any restrictions on conversion or exchange in the event of redemption
of the debt securities and any restrictions on conversion or exchange,
including restrictions directed at maintaining our status as a REIT;
and
o the means of calculating the number of shares of our common stock,
preferred stock or other securities or property to be received by the
holders of debt securities.
The conversion or exchange price of any debt securities of any series that
are convertible into our common stock or preferred stock may be adjusted for any
stock dividends, stock splits, reclassification, combinations or similar
transactions, as set forth in the applicable prospectus supplement (Article
Sixteen).
Governing Law
The indenture is governed by and shall be construed in accordance with the
laws of the State of Georgia.
Redemption of Debt Securities
The debt securities may be subject to optional or mandatory redemption on
terms and conditions described in the applicable prospectus supplement. Subject
to such terms, we may opt at any time to partially or entirely redeem the debt
securities.
From and after notice has been given as provided in the indenture, if funds
for the redemption of any debt securities called for redemption shall have been
made available on the redemption date, the debt securities will cease to bear
interest on the date fixed for the redemption specified in the notice, and the
only right of the holders of the debt securities will be to receive payment of
the redemption price.
DESCRIPTION OF WARRANTS
The following summary describes generally the terms of warrants that we may
offer from time to time in one or more series. The specific terms of a series of
warrants will be described in the applicable prospectus
31
supplement relating to that series of warrants along with any general provisions
applicable to that series of warrants. The following description of the
warrants, and any description of the warrants in a prospectus supplement, may
not be complete and is subject to, and qualified in its entirety by reference
to, the underlying warrant agreement, which we will file with the SEC at or
prior to the time of the sale of the warrants. You should refer to, and read
this summary together with, the warrant agreement and the applicable prospectus
supplement to review the terms of a particular series of our common or preferred
stock that may be important to you. You can obtain copies of any form of warrant
agreement or other agreement pursuant to which the warrants are issued by
following the directions described under the caption "Where You Can Find More
Information."
We may issue warrants to purchase depositary shares, debt securities,
shares of our common stock or preferred stock, or any combination of those
securities. We may issue warrants independently or together with any other
securities, and the warrants may be attached to, or separate from, any other
securities. Each series of warrants to be issued will be issued under a separate
warrant agreement between us and a warrant agent specified in the related
prospectus supplement. The warrant agent will act solely as our agent in
connection with the warrants of a series and will not assume any obligation or
relationship of agency or trust for or with holders or beneficial owners of the
warrants.
The applicable prospectus supplement will describe the terms of any
warrants, including the following:
o the title of the warrants;
o the total number of warrants;
o the price or prices at which the warrants will be issued and sold;
o the currency or currencies, including composite currencies or currency
units, in which the price of the warrants may be payable;
o the designation and terms of the securities purchasable upon exercise
of the warrants;
o the price at which, and the currency or currencies, including
composite currencies or currency units, in which the securities
purchasable upon exercise of the warrants may be purchased;
o the date on which the right to exercise the warrants shall commence
and the date on which that right will expire;
o whether the warrants will be issued in registered form or bearer form;
o if applicable, the minimum or maximum amount of the warrants which may
be exercised at any one time;
o if applicable, the date on and after which the warrants and the
related underlying securities will be separately transferable;
o information with respect to book-entry procedures, if any;
o if applicable, a summary of the United States federal income tax
considerations; and
o any other terms of the warrants, including terms, procedures and
limitations relating to the exchange and exercise of the warrants,
including restrictions directed at maintaining our REIT status.
Warrant certificates may be exchanged for new warrant certificates of
different denominations, and warrants may be exercised at the corporate trust
office of the warrant agent or any other office indicated in the applicable
prospectus supplement. Prior to the exercise of their warrants, holders of
warrants will not have any of the rights of holders of the respective underlying
securities purchasable upon exercise of the warrants.
32
MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following is a general summary of the material U.S. federal income tax
considerations applicable to us and our security holders and our election to be
taxed as a REIT. It is not tax advice. This summary is not intended to represent
a detailed description of the U.S. federal income tax consequences applicable to
a particular stockholder or security holder in view of any person's particular
circumstances and is not intended to represent a description of the U.S. federal
income tax consequences applicable to stockholders subject to special treatment
under the U.S. federal income tax laws, including insurance companies,
tax-exempt organizations, financial institutions and securities broker-dealers.
The sections of the Internal Revenue Code, or the Code, relating to our
qualification and operation as a REIT are highly technical and complex. The
following discussion sets forth the material aspects of the Code sections that
govern the U.S. federal income tax treatment of a REIT and its security holders.
The information in this section is based on the Code, current, temporary and
proposed Treasury regulations promulgated under the Code, the legislative
history of the Code, current administrative interpretations and practices of the
Internal Revenue Service, or IRS, and court decisions, in each case as of the
date of this prospectus. In addition, the administrative interpretations and
practices of the IRS include its practices and policies as expressed in private
letter rulings, which are not binding on the IRS except with respect to the
particular taxpayers who requested and received those rulings. Future
legislation, Treasury regulations, administrative interpretations and practices
and court decisions may adversely affect the tax considerations described in
this discussion. Any change could apply retroactively to transactions preceding
the date of the change. Except as described below, we have not requested, and do
not plan to request, any rulings from the IRS concerning our tax treatment or
the treatment of our security holders, and the statements in this prospectus are
not binding on the IRS or any court. Thus, we can provide no assurance that the
tax considerations described in this discussion will not be challenged by the
IRS or, if challenged, will be sustained by a court.
You are urged to consult your own tax adviser regarding the federal, state,
local, foreign and other tax consequences to you of the purchase, ownership and
sale of our securities and our election to be taxed as a REIT.
Taxation of the Company as a REIT
General
We elected to be taxed as a REIT under sections 856 through 860 of the
Code, commencing with our taxable year beginning January 1, 1995, and we believe
we have been organized and have operated in a manner that allows us to qualify
for taxation as a REIT since then. We intend to continue to operate in this
manner, but there is no assurance that we have operated or will continue to
operate in a manner so as to qualify or remain qualified as a REIT.
As a condition to the closing of each offering of securities offered by
this prospectus, other than offerings of medium term notes and as otherwise
specified in the applicable prospectus supplement, our tax counsel will render
an opinion to the underwriters of that offering to the effect that, commencing
with our taxable year that began January 1, 1995, we have been organized in
conformity with the requirements for qualification as a REIT, and our method of
operation has enabled us to meet, and our proposed method of operation will
enable us to continue to meet the requirements for qualification and taxation as
a REIT under the Code. It must be emphasized that this opinion will be based on
various assumptions and representations that we will make as to factual matters,
including representations to be made in a factual certificate to be provided by
one of our officers. In addition, this opinion will be based on our factual
representations set forth in this prospectus and in the applicable prospectus
supplement. Our tax counsel will have no obligation to update its opinion
subsequent to the date it is rendered. Moreover, our qualification and taxation
as a REIT depend on our ability to meet, through actual annual operating
results, asset diversification, distributions and diversity of stock ownership,
the various qualification tests imposed by the Code, discussed below, the
results of which will not be reviewed by our tax counsel. Accordingly, no
assurance can be given that our actual results of operations for any particular
taxable year will satisfy those requirements. Further, the anticipated U.S.
federal income tax treatment described in this prospectus may be changed,
perhaps retroactively, by legislative, administrative or judicial action at any
time.
33
If we qualify for taxation as a REIT, we generally will not be required to
pay U.S. federal corporate income tax on our net income that is currently
distributed to stockholders. This treatment substantially eliminates the "double
taxation" that generally results from investment in a corporation. Double
taxation means taxation once at the corporate level when income is earned and
again at the stockholder level when the income is distributed. We will be
required to pay U.S. federal income tax, however, as follows:
o We will be required to pay tax at regular corporate rates on any
undistributed real estate investment trust taxable income, including
undistributed net capital gains.
o We may be required to pay the "alternative minimum tax" on our items
of tax preference.
o If we have (1) net income from the sale or other disposition of
foreclosure property that is held primarily for sale to customers in
the ordinary course of business or (2) other non-qualifying income
from foreclosure property, we will be required to pay tax at the
highest corporate rate on that income. Foreclosure property is
generally defined as property acquired by foreclosure or after a
default on a loan secured by the property or a lease of the property.
o We will be required to pay a 100% tax on any net income from
prohibited transactions. Prohibited transactions are, in general,
sales or other dispositions of property, other than foreclosure
property, held primarily for sale to customers in the ordinary course
of business.
o If we fail to satisfy the 75% gross income test or the 95% gross
income test, as described below, but we have otherwise maintained our
qualification as a REIT, we will be required to pay a 100% tax on an
amount equal to (1) the greater of (a) the amount by which 75% of our
gross income exceeds the amount of our gross income qualifying for the
75% gross income test, described below, and (b) the amount by which
90% of our gross income exceeds the amount of our gross income
qualifying for the 95% gross income test, described below, multiplied
by (2) a fraction intended to reflect our profitability.
o If we fail to distribute during any calendar year at least the sum of
(1) 85% of our real estate investment trust ordinary income for that
year, (2) 95% of our real estate investment trust capital gain net
income for that year and (3) any undistributed ordinary income and net
capital gain from prior periods, we will be required to pay a 4%
excise tax on the excess of that required distribution over the
amounts actually distributed.
o If we acquire any asset from a corporation that is or has been a C
corporation in a transaction in which the basis of the asset in our
hands is determined by reference to the basis of the asset in the
hands of the C corporation, and we subsequently recognize gain on the
disposition of that asset during the ten year period beginning on the
date we acquired the asset, we will be required to pay tax at the
highest regular corporate tax rate on the lesser of (1) the amount of
that gain and (2) the excess of (a) the fair market value of the asset
over (b) our adjusted basis in the asset, in each case determined as
of the date we acquired the asset. A C corporation is generally
defined as a corporation required to pay full corporate level tax. In
addition, if we recognize gain on the disposition of any asset during
the ten year period beginning on the first day of the first taxable
year for which we qualified as a REIT and we held the asset on that
day, we will be required to pay tax at the highest regular corporate
tax rate on the lesser of (1) the amount of that gain and (2) the
excess of (a) the fair market value of the asset over (b) our adjusted
basis in the asset, in each case determined as of the first day of the
first taxable year for which we qualified as a REIT. The rules
described in this paragraph with respect to the recognition of gain
assume that we have made and, if required, will make a timely election
under the relevant Treasury regulations or a prior IRS notice with
respect to assets acquired from a C corporation that have a carryover
basis and assets that we owned on the first day of the first taxable
year for which we qualified as a REIT. We have timely filed elections
provided by the relevant Treasury regulations and the prior IRS
notice, and we intend to timely file all other similar elections.
o A 100% tax may be imposed on certain items of income and expense that
are paid directly or
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constructively between us and a taxable REIT subsidiary (as described
below) if and to the extent the IRS successfully adjusts the reported
amount of those items.
Requirements for Qualification. The Code defines a REIT as a corporation,
trust or association:
(1) that is managed by one or more trustees or directors,
(2) that issues transferable shares or transferable certificates to
evidence beneficial ownership,
(3) that would be taxable as a domestic corporation but for sections
856 through 860 of the Code,
(4) that is not a financial institution or an insurance company
within the meaning of the Code,
(5) that is beneficially owned by 100 or more persons,
(6) not more than 50% in value of the outstanding stock of which is
owned, directly or constructively, by five or fewer individuals,
including specified entities in certain circumstances, during the
last half of each taxable year, and
(7) that meets other tests, described below, regarding the nature of
its income and assets and the amount of its distributions.
The Code provides that conditions (1) through (4) must be met during the
entire taxable year and that condition (5) must be met during at least 335 days
of a taxable year of 12 months or during a proportionate part of a taxable year
of less than 12 months. For purposes of condition (6), an "individual" generally
includes a supplemental unemployment compensation benefit plan, a private
foundation, or a portion of a trust permanently set aside or used exclusively
for charitable purposes, but does not include a qualified pension plan or profit
sharing trust.
We have satisfied condition (5) and believe that we have satisfied
condition (6). In addition, our charter provides, and the articles supplementary
for any series of preferred stock will provide, for restrictions on the
ownership and transfer of our stock. Those restrictions are intended to assist
us in continuing to satisfy the share ownership requirements described in
conditions (5) and (6) above. The ownership and transfer restrictions pertaining
generally to our common stock and preferred stock are described in "Description
of Common and Preferred Stock--REIT Ownership Limitations" or, to the extent
those restrictions differ from those described in this prospectus, those
restrictions will be described in the applicable prospectus supplement. There
can be no assurance that those transfer restrictions in all cases will prevent a
violation of the stock ownership provisions described in conditions (5) and (6)
above. To monitor compliance with the share ownership requirements, we are
generally required to maintain records regarding the actual owners of our stock.
To do so, we must demand written statements each year from the record holders of
significant percentages of our stock in which the record holders are to disclose
the actual owners of the stock, i.e., the persons required to include in gross
income the dividends we distribute. If we satisfy these requirements and have no
reason to know that condition (6) is not satisfied, we will be deemed to have
satisfied condition (6).
In addition, a corporation may not elect to become a REIT unless its
taxable year is the calendar year. We have a calendar year.
Ownership of Qualified REIT Subsidiaries and Interests in Partnerships. We
own and operate a number of properties through subsidiaries. Section 856(i) of
the Code provides that a corporation that is a "qualified REIT subsidiary" will
not be treated as a separate corporation for U.S. Federal income tax purposes,
and all assets, liabilities and items of income, deduction and credit of a
"qualified REIT subsidiary" will be treated as assets, liabilities and items of
income, deduction and credit of the REIT. Thus, in applying the requirements
described herein, our "qualified REIT subsidiaries" will be ignored, and all
assets, liabilities and items of income, deduction and credit of those
subsidiaries will be treated as our assets, liabilities and items of income,
deduction and credit.
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We have received a ruling from the IRS to the effect that each of the
subsidiaries we owned on January 1, 1995, the effective date of our REIT
election, was a qualified REIT subsidiary. Moreover, with respect to each of our
subsidiaries formed after January 1, 1995 and before January 1, 1998, we have
owned 100% of the stock of that subsidiary at all times during the period that
subsidiary has been in existence. For taxable years beginning on or after
January 1, 1998, any corporation wholly owned by a REIT is permitted to be
treated as a "qualified REIT subsidiary" regardless of whether that subsidiary
has always been owned by the REIT. Therefore, all of our subsidiaries are
"qualified REIT subsidiaries" within the meaning of the Code.
Treasury regulations provide that if we are a partner in a partnership, we
will be deemed to own our proportionate share of the assets of the partnership.
In addition, we will take into account the income of the partnership
attributable to our proportionate interest in the partnership. The assets and
gross income of the partnership will retain the same character in our hands for
purposes of section 856 of the Code, including satisfying the asset tests and
gross income tests described below. The treatment described above also applies
to limited liability companies that are treated as partnerships. Thus, our
proportionate share of the assets, liabilities and items of income of the
partnerships and limited liability companies that are treated as partnerships in
which we are a partner or a member, respectively, will be treated as our assets,
liabilities and items of income for purposes of applying the income tests and
asset tests applicable to a REIT.
Income Tests. We must satisfy two gross income requirements annually to
maintain our qualification as a REIT:
o First, in each taxable year, we generally must derive at least 75% of
our gross income, excluding gross income from prohibited transactions,
from (a) investments relating to real property or mortgages on real
property, including rents from real property or interest on mortgage
loans or (b) certain types of temporary investments.
o Second, in each taxable year, we generally must derive at least 95% of
our gross income, excluding gross income from prohibited transactions,
from (a) the real property investments that qualify for the 75% test
and (b) dividends, interest or gain from the sale or disposition of
stock or securities.
For these purposes, the term "interest" generally does not include any
amount received or accrued, directly or indirectly, if the determination of that
amount depends in whole or in part on the income or profits of any person.
However, an amount received or accrued generally will not be excluded from the
term "interest" solely by reason of being based on a fixed percentage or
percentages of receipts or sales.
Rents we receive will qualify as "rents from real property" in satisfying
the gross income requirements for a REIT only if the following conditions are
met:
o First, the amount of rent is not based in whole or in part on the
income or profits of any person. However, an amount generally will not
be excluded from the term "rents from real property" solely by reason
of being based on a fixed percentage or percentages of receipts or
sales.
o Second, neither we nor an actual or constructive owner of 10% or more
of our stock owns, actually or constructively, 10% or more of the
equity interests in the tenant.
o Third, rent attributable to personal property leased in connection
with a lease of real property is not greater than 15% of the total
rent received under the lease. If this condition is not met, the
portion of the rent attributable to personal property will not qualify
as "rents from real property."
o Finally, we generally must not operate or manage our property or
furnish or render services to our tenants, subject to a 1% de minimis
exception, other than through an independent contractor from whom we
derive no revenue. We may, however, directly perform services that are
"usually or customarily rendered" in connection with the rental of
space for occupancy only and that are not otherwise considered
"rendered to the occupant" of the property. In addition, we may employ
a taxable REIT subsidiary that we own, in whole or in part, to provide
both customary and noncustomary services to our tenants without
causing the rent we receive from those tenants to fail
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to qualify as "rents from real property."
We generally do not intend to receive rent that fails to satisfy any of the
foregoing conditions unless, based on the advice of our tax counsel, doing so
will not jeopardize our status as a REIT.
If we fail to satisfy one or both of the 75% or 95% gross income tests for
any taxable year, we nevertheless may qualify as a REIT if we are entitled to
relief under the Code. Generally, we may avail ourselves of the relief
provisions if:
o our failure to satisfy the gross income tests was due to reasonable
cause and not willful neglect,
o we attach a schedule of the sources of our income to our U.S. federal
income tax return, and
o any incorrect information on the schedule is not due to fraud with
intent to evade tax.
It is not possible to predict whether in all circumstances we would be
entitled to the benefit of the relief provisions. As discussed above under
"--General," even if the relief provisions apply, a 100% tax would be imposed
with respect to our non-qualifying income.
Prohibited Transaction Income. Any gain that we realize on the sale of any
property held as inventory or other property held primarily for sale to
customers in the ordinary course of business will be treated as income from a
prohibited transaction that is subject to a 100% penalty tax. Prohibited
transaction income may also have an adverse effect on our ability to satisfy the
income tests for qualification as a REIT. Under existing law, whether property
is held as inventory or primarily for sale to customers in the ordinary course
of business is a question of fact that depends on all the facts and
circumstances with respect to a particular transaction. We hold our properties
for investment with a view to long-term appreciation, we are engaged in the
business of acquiring, developing, owning and operating our properties and we
make occasional sales of properties consistent with our investment objectives.
There can be no assurance, however, that the IRS might not contend that one or
more of those sales is subject to the 100% penalty tax.
Asset Tests. At the close of each quarter of our taxable year, we must
satisfy the following tests relating to the nature and diversification of our
assets.
o First, at least 75% of the value of our total assets must be
represented by real estate assets, cash, cash items and government
securities. For purposes of this test, qualifying assets include stock
or debt instruments that are purchased with the proceeds of a stock
offering or a public debt offering with a term of at least five years,
but only for the one-year period beginning on the date we receive the
proceeds.
o Second, not more than 25% of our total assets may be represented by
securities other than those that satisfy the 75% asset test.
o Third, for taxable years ending on or before December 31, 2000, of the
investments included in the 25% asset class, the value of any one
issuer's securities that we own may not exceed 5% of the value of our
total assets, and we may not own more than 10% of any one issuer's
outstanding voting securities.
o For taxable years beginning after December 31, 2000, (a) not more than
20% of the value of our total assets may be represented by securities
of one or more taxable REIT subsidiaries, and (b) except for the
securities of a taxable REIT subsidiary and securities that satisfy
the 75% asset test, (i) not more than 5% of the value of our assets
may be represented by securities of any one issuer, and (ii) we may
not own more than 10%, by vote or value, of any one issuer's
outstanding securities. For purposes of the 10% value test, securities
do not include straight debt that we own if (x) the issuer is an
individual, (y) neither we nor any of our taxable REIT subsidiaries
owns any security of the issuer other than straight debt or (z) the
issuer is a partnership and we own at least a 20% profits interest in
the partnership. Straight debt is any written unconditional promise to
pay on demand or on a specified date a fixed amount of money if the
interest rate and interest payment
37
dates are not contingent on profits, the borrower's discretion or
similar factors, and the debt is not convertible, directly or
indirectly, into stock.
We currently have numerous direct and indirect wholly-owned subsidiaries.
As set forth above, the ownership by a REIT of more than 10% of the voting
securities of any one issuer is prohibited unless that subsidiary is a taxable
REIT subsidiary. However, our subsidiaries are "qualified REIT subsidiaries" as
defined in the Code and, as such, will not be treated as separate corporations
for U.S. federal income tax purposes and will not cause us to fail the asset
tests.
After initially meeting the asset tests at the close of any quarter, we
will not lose our status as a REIT for failure to satisfy the asset tests at the
end of a later quarter solely by reason of changes in asset values. If the
failure to satisfy the asset tests results from an acquisition of securities or
other property during a quarter, the failure can be cured by the disposition of
sufficient nonqualifying assets within 30 days after the close of the quarter.
We intend to maintain adequate records of the value of our assets to ensure
compliance with the asset tests and to take those other actions within 30 days
after the close of any quarter that may be required to cure any noncompliance.
If we fail to cure noncompliance with the asset tests within that time period,
we would cease to qualify as a REIT.
Taxable REIT Subsidiary. As discussed above, for taxable years beginning
after December 31, 2000, a REIT may own more than 10%, by vote or value, of the
securities of an issuer if the issuer is a taxable REIT subsidiary of the REIT.
A corporation qualifies as a taxable REIT subsidiary of a REIT if the
corporation jointly elects with the REIT to be treated as a taxable REIT
subsidiary of the REIT. Dividends from a taxable REIT subsidiary will be
nonqualifying income for purposes of the 75% gross income test but not the 95%
gross income test. Other than certain activities relating to lodging and health
care facilities, a taxable REIT subsidiary generally may engage in any business,
including the provision of customary or noncustomary services to tenants of its
parent REIT.
The Code imposes restrictions, applicable to taxable years beginning after
December 31, 2000, that generally are intended to ensure that transactions
between a REIT and its taxable REIT subsidiary occur at arm's length and on
commercially reasonable terms. Included among them is a provision that prevents
a taxable REIT subsidiary from deducting interest on direct or indirect
indebtedness to its parent REIT if, under a specified series of tests, the
taxable REIT subsidiary is considered to have an excessive interest expense
level and debt to equity ratio. In some cases, the Code imposes a 100% tax on a
REIT if its rental, service and/or other agreements with its taxable REIT
subsidiaries are not on arm's length terms.
We do not own stock in any corporation for which a taxable REIT subsidiary
election has been made.
Annual Distribution Requirements. To maintain our qualification as a REIT,
we are required to distribute dividends, other than capital gain dividends, to
our stockholders in an amount at least equal to:
o The sum of:
- 90% of our REIT taxable income, and
- 90% of the our after-tax net income, if any, from foreclosure
property,
minus
o the excess of the sum of specified items of non-cash income items over
5% of our REIT taxable income.
For purposes of the foregoing tests, our REIT taxable income is computed without
regard to the dividends paid deduction and our net capital gain. Non-cash income
items include income attributable to leveled stepped rents, original issue
discount or purchase money discount debt and a like-kind exchange that is later
determined to be taxable. We believe we have made, and intend to continue to
make, timely distributions sufficient to satisfy these annual distribution
requirements.
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We must pay these distributions in the taxable year to which they relate or
in the following taxable year provided we declare them before we timely file our
tax return for the year to which they related and provided we pay them within
the 12-month period following the close of that taxable year and not later than
the date of the first regular dividend payment made after that declaration. The
amount distributed must not be preferential, that is, each holder of shares of
common stock and each holder of shares of each class of preferred stock must
receive the same distribution per share. To the extent we distribute at least
90%, but less than 100%, of our REIT taxable income, as adjusted, or less than
all of our net capital gain, we will be subject to tax on the undistributed
amounts at regular corporate tax rates.
We expect our REIT taxable income to be less than our cash flow because of
depreciation and other non-cash charges included in computing our REIT taxable
income. Accordingly, we anticipate that we generally will have sufficient cash
or liquid assets to enable us to satisfy our distribution requirement. However,
it is possible that, from time to time, we may not have sufficient cash or other
liquid assets to meet the distribution requirement due to timing differences
between the actual receipt of income and actual payment of deductible expenses
and the inclusion of that income and deduction of those expenses in arriving at
our taxable income. In the event those timing differences occur, in order to
meet the distribution requirement, we may find it necessary to arrange for
short-term, or possibly long-term, borrowings or to pay dividends in the form of
taxable stock dividends.
We may be able to rectify a failure to meet the distribution requirement
for a year by distributing "deficiency dividends" in a later year which may be
included in our deduction for dividends paid for the earlier year. Thus, we may
be able to avoid being taxed on amounts distributed as deficiency dividends. We
will be required, however, to pay interest based on the amount of any deduction
claimed for deficiency dividends, and we would be subject to any applicable
penalty provisions.
In addition, we will be required to pay a 4% excise tax on the excess of
the required distribution over the amounts actually distributed if we fail to
distribute during any calendar year, or in the case of distributions with
declaration and record dates falling in the last three months of a calendar
year, by the end of the January immediately following that year, at least the
sum of 85% of our ordinary income for that year, 95% of our capital gain net
income for that year, plus, in each case, any undistributed ordinary income or
capital gain net income, as the case may be, from prior periods. Any ordinary
income or capital gain net income on which this excise tax is imposed for any
year is treated as an amount distributed that year for purposes of calculating
the tax.
Failure to Qualify. If we fail to qualify for taxation as a REIT in any
taxable year, and if the relief provisions do not apply, we will be subject to
tax, including possibly the alternative minimum tax, on our taxable income at
regular corporate rates. The failure to qualify for taxation as a REIT could
have a significant adverse effect on the market value and marketability of the
securities offered by this prospectus. In any year in which we fail to qualify
as a REIT, we will not be able to deduct, and we will not be required to make,
distributions to stockholders. As a result, our failure to qualify as a REIT
would substantially reduce the amount of our cash available for distribution to
stockholders. In that event, to the extent of our current and accumulated
earnings and profits, as computed for U.S. federal income tax purposes, all of
our distributions to stockholders will be taxable as ordinary income and,
subject to applicable limitations, corporate stockholders will be eligible for
the dividends received deduction. Unless entitled to relief under specific
statutory provisions, we will also be disqualified from taxation as a REIT for
the four taxable years following the year during which we lost qualification.
Tax Aspects of the Partnerships
General. A portion of our investments is held through our partnerships and
limited liability companies, which, for U.S. federal income tax purposes, are
generally treated as partnerships. References to partnerships in the following
discussion also apply to our limited liability companies. In general,
partnerships are "pass-through" entities that are not subject to U.S. federal
income tax. Rather, partners are allocated their proportionate shares of the
items of income, gain, loss, deduction and credit of a partnership and are
potentially subject to tax thereon, without regard to whether the partners
receive a distribution from the partnership. We include in our income our
proportionate share of our partnerships' income, gain, loss, deduction and
credit for purposes of the various REIT income tests and in the computation of
our REIT taxable income. In addition, we include our proportionate share of
assets held by our partnerships in the REIT asset tests.
39
Partnership Classification for Tax Purposes. Treasury regulations that are
effective as of January 1, 1997 provide that a domestic partnership is generally
taxed as a partnership unless it elects to be taxed as an association taxable as
a corporation. None of the partnerships in which we are a partner has made or
intends to make that election. These Treasury regulations provide that a
partnership's claimed classification will be respected for periods prior to
January 1, 1997 if the entity had a reasonable basis for its claimed
classification and had not been notified in writing on or before May 8, 1996
that its classification was under examination. If any of our partnerships were
treated as an association taxable as a corporation for a prior period, and if
(i) our interest in any of those partnerships possessed more than 10% of the
total voting power of all of the partnership interests or, for taxable years
beginning after December 31, 2000, more than 10% of the total voting power or
value of all of the partnership's interests, or (ii) the value of that interest
exceeded 5% of the value of our assets, we would cease to qualify as a REIT for
that period and possibly later periods. Moreover, a deemed change in
classification of that partnership from an association taxable as a corporation
to a partnership effective on or after January 1, 1997 would be a taxable event.
We believe that each of our partnerships has been treated properly for tax
purposes as a partnership and not as an association taxable as a corporation.
However, no assurance can be given that the IRS may not successfully challenge
the status of any of our partnerships.
Tax Allocation with Respect to Our Properties. When property is contributed
to a partnership in exchange for an interest in the partnership, the partnership
generally takes a carryover basis in that property for tax purposes. That
carryover basis is equal to the contributing partner's adjusted basis in the
property rather than the fair market value of the property at the time of
contribution. Section 704(c) of the Code requires the allocation of income,
gain, loss and deduction attributable to the contributed property in a manner
that allocates the unrealized gain or unrealized loss associated with the
property at the time of the contribution to the contributing partner. The amount
of the unrealized gain or unrealized loss, also known as a "book-tax
difference," generally is equal to the difference between the fair market value
of the contributed property at the time of contribution and the adjusted basis
of the property at that time. Those allocations are solely for U.S. federal
income tax purposes and do not affect the book capital accounts or other
economic or legal arrangements among the partners.
In general, partners who have contributed to our partnerships their
interests in properties with a book-tax difference will be allocated lower
amounts of depreciation deductions for tax purposes than if those deductions
were determined on a pro rata basis. In addition, in the event of the
disposition of any of the contributed assets that have a book-tax difference,
all taxable income attributable to the book-tax difference generally will be
allocated to the contributing partners, and our companies that are the direct
partners of our partnerships generally will be allocated only their share of
gains attributable to appreciation, if any, occurring after the acquisition of
those properties. These allocations will tend to eliminate the book-tax
difference over the life of our partnerships. However, the allocation rules of
section 704(c) of the Code do not always entirely eliminate the book tax
difference on an annual basis or with respect to a specific taxable transaction
like a sale. In those cases, the carryover basis of the contributed assets in
the hands of our partnerships may cause us to be allocated lower depreciation
and other deductions and thereby cause us to be allocated more taxable income
than if there were no book-tax difference. As a result, we could recognize
taxable income in excess of distributed amounts, which might adversely affect
our ability to comply with the REIT distribution requirements, and we may
realize income on the distribution of cash because our basis has not increased
sufficiently from income allocations. See "Taxation of the Company as a REIT --
Annual Distribution Requirements."
Basis in Partnership Interests. Our adjusted tax basis in our interest in a
partnership generally will be equal to:
o the amount of cash and the basis of any other property that we
contributed to the partnership;
o increased by:
- our allocable share of the partnership's income; and
- our allocable share of any indebtedness of the partnership; and
o decreased, but not below zero, by our allocable share of:
- losses incurred by the partnership;
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- the amount of any cash distributed to us; and
- the amount of any constructive distributions resulting from a
reduction in our share of any indebtedness of the partnership.
If a partner's distributive share of a partnership's loss exceeds the
adjusted tax basis of the partner in its partnership interest, the partner will
not be entitled to a deduction for that excess loss until and to the extent the
partner has an adjusted tax basis in its partnership interest. To the extent
distributions by a partnership and any decrease in a partner's share of
indebtedness of the partnership (which is treated as a constructive distribution
to the partner) exceed the adjusted tax basis of the partner's partnership
interest, those excess distributions constitute taxable income to the partner.
That taxable income generally will be characterized as long-term capital gain if
the partner has held its partnership interest for more than one year, subject to
a reduced maximum tax rate described below in the case of noncorporate
taxpayers. Under current law, capital gains and ordinary income of corporations
are taxed at the same marginal rates.
Sale of the Partnerships' Properties. Our share of any gain that a
partnership recognizes on a sale of any property the partnership holds as
inventory or other property held primarily for sale to customers in the ordinary
course of business will be income from a prohibited transaction that is subject
to a 100% penalty tax. Prohibited transaction income may also have an adverse
effect on our ability to satisfy the income tests for qualification as a REIT.
Under existing law, whether property is held as inventory or primarily for sale
to customers in the ordinary course of business is a question of fact that
depends on all the facts and circumstances with respect to a particular
transaction. Our partnerships intend to hold their properties for investment
with a view to long-term appreciation, to engage in the business of acquiring,
developing, owning and operating their properties, and other properties, and to
make occasional sales of properties, including peripheral land, consistent with
our partnerships' investment objectives.
Taxation of Holders
U.S. Holders
A "U.S. Holder" is a beneficial owner of our common stock, preferred stock
or other security that, for U.S. federal income tax purposes, is:
o a citizen or individual resident of the United States;
o a corporation, including an entity treated as a corporation for U.S.
federal income tax purposes, created or organized in or under the law
of the United States or any of its political subdivisions;
o an estate the income of which is subject to U.S. federal income
taxation regardless of its source; or
o a trust if (1) a court within the United States is able to exercise
primary supervision over the administration of the trust, and one or
more United States persons have the authority to control all
substantial decisions of the trust, or (2) the trust was in existence
on August 20, 1996 and properly elected to continue to be treated as a
United States person.
For any taxable year in which we qualify as a REIT, a taxable U.S. Holder
will be taxed as set forth below.
Dividend Distributions Generally. A distribution we pay on our common or
preferred stock to a U.S. Holder, other than a capital gain dividend, will
constitute a dividend to the extent paid out of our current or accumulated
earnings and profits, as determined for U.S. federal income tax purposes, and,
to that extent, will constitute ordinary income. Our dividends are not eligible
for the dividends-received deduction available to corporations. Any distribution
we make that exceeds our current and accumulated earnings and profits will be
treated first as a tax-free return of capital, reducing the U.S. Holder's tax
basis in our stock to the extent thereof, and thereafter as gain recognized as
if the U.S. Holder had sold our stock. Dividends we declare in October, November
or December of any year payable to a stockholder of record on a specified date
in any of those months will be treated as both paid by us and received by our
stockholders on December 31 of that year, provided we actually pay
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the dividends during January of the following calendar year. A U.S. Holder is
not allowed to take any loss we may incur into account on his own U.S. federal
income tax returns.
We will be deemed to have sufficient earnings and profits to treat as a
dividend any distribution we make up to the amount required to be distributed to
avoid imposition of the 4% excise tax discussed in "Taxation of the Company as a
REIT -- Annual Distribution Requirement" above.
Recently enacted U.S. federal income tax legislation reduced the maximum
rate of U.S. federal income tax that noncorporate taxpayers pay on dividends to
15%. That legislation, however, generally does not apply to dividends paid by a
REIT, except to the extent of dividends attributable to (i) income on which the
REIT paid tax, for example, in cases when the REIT has distributed less than all
of its REIT taxable income or sold property subject to corporate tax because it
was acquired from a C corporation within the preceding ten years with a
carryover basis, (ii) dividends the REIT received from other REITs to the extent
those dividends qualify for the 15% maximum rate, (iii) dividends the REIT
received from corporations other than REITs and (iv) actual or deemed capital
gain distributions by the REIT, except to the extent attributable to
depreciation recapture, which remains subject to a 25% tax rate. A number of
conditions must be satisfied to qualify for the new 15% tax rate, including the
following. First, with respect to a qualifying dividend other than an actual or
deemed capital gain distribution, a U.S. Holder must also satisfy certain
unhedged holding period requirements with respect to the stock on which the
dividend is paid. Second, a U.S. Holder must not receive a payment in lieu of a
dividend on the stock, for example, when a broker lends that U.S. Holder stock.
Third, a U.S. Holder must not be obligated to make related payments with respect
to any position in substantially similar or related property. Fourth, in
determining the amount of a U.S. Holder's deductible investment interest
expense, if any, a dividend is treated as investment income only if that U.S.
Holder elects to treat the dividend as not eligible for the maximum rate. The
reduced rates apply for purposes of both the regular tax and the alternative
minimum tax. In the case of dividends that otherwise would be taxed at the 10%
or 15% rates, the new maximum rate is 5%, except for taxable years beginning
after December 31, 2007, for which the tax is eliminated. The new reduced tax
rates on dividends apply to taxable years beginning after December 31, 2002 and
before January 1, 2009.
Capital Gain Dividends. A U.S. Holder will treat a distribution that we
properly designate as a capital dividend as long-term capital gain, to the
extent it does do not exceed our actual net capital gain for the taxable year,
without regard to the period the U.S. Holder has held the stock. However, a
corporate stockholder may be required to treat up to 20% of certain capital gain
dividends as ordinary income. A capital gain dividend is not eligible for the
dividends-received deduction available to corporations.
We may elect to retain and pay U.S. federal income tax on any net capital
gain we may recognize in any taxable year. Net capital gain is the excess of net
long-term capital gain over net short-term capital loss. In addition, we may
elect to treat our stockholders as receiving an amount not in excess of our net
capital gain for the taxable year. In that case, a U.S. Holder will include in
income his proportionate share of our undistributed net capital gain as
long-term capital gain. The U.S. Holder also will be deemed to have paid his
proportionate share of tax we paid on our net capital gain and will receive a
credit or refund for the amount of that tax in computing his U.S. federal income
tax liability. A U.S. Holder's basis in our shares will increase by the amount
of the undistributed long-term capital gain he includes in income, reduced by
the U.S. Holder's share of our tax paid on that gain.
When a REIT designates a distribution as a capital gain dividend, the REIT
may also designate the portions of the distribution that are subject to the
different tax rates applicable to different categories of capital gains.
Depreciation recapture, for example, is subject to a maximum rate of 25%. These
additional designations by the REIT are effective only to the extent they do not
exceed certain limitations.
Certain Dispositions of Shares. In general, a U.S. Holder will recognize
capital gain or loss on a sale or other taxable disposition of our stock equal
to the difference between (1) the amount of cash and the fair market value of
any property he receives on that disposition and (2) the U.S. Holder's adjusted
basis in that stock. A loss that a U.S. Holder recognizes on a taxable
disposition of our stock held for less than six months, after applying certain
holding period rules, will be treated as a long-term capital loss to the extent
of any capital gain dividend the selling U.S. Holder received on that stock.
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Recently enacted U.S. federal income tax legislation reduced the maximum
rate of tax on the adjusted net capital gain of an individual, trust or estate
to 15% (or, with respect to adjusted net capital gain that otherwise would be
taxed at the 10% or 15% rates, to 5%, except for taxable years beginning after
December 31, 2007, for which the tax is eliminated). The new reduced tax rates
apply for purposes of both the regular tax and the alternative minimum tax. The
lower rates of 8% and 18% for assets held more than five years were repealed.
The new rules apply to taxable years ending on or after May 6, 2003 and before
January 1, 2009, after which the maximum tax rate on adjusted net capital gain
will be 20%.
Passive Activity Loss and Investment Interest Limitations. A U.S. Holder
may not treat distributions received from us or any gain recognized on a
disposition of our stock as passive activity income. Therefore, you will not be
able to apply any "passive losses" against that income or gain. Dividends we
pay, to the extent they do not constitute a return of capital, generally will be
treated as investment income for purposes of the investment interest limitation,
although they will not be treated as investment income unless the recipient
elects to treat them as not eligible for the new maximum tax rates on dividends,
to the extent they qualify. Net capital gain from the disposition of our stock
and capital gain dividends generally will be excluded from investment income
unless the recipient elects to have that gain taxed as ordinary income.
Backup Withholding and Information Reporting for our Distributions. We
report to our U.S. Holders and the IRS the amount of dividends we paid during
the preceeding calendar year and the amount of tax withheld, if any. Under the
backup withholding rules, a U.S. Holder may be subject to backup withholding
with respect to dividends paid unless the stockholder either is a corporation or
comes within certain other exempt categories and, when required, demonstrates
that fact, or provides a taxpayer identification number, certifies as to no loss
of exemption from backup withholding and otherwise complies with the applicable
requirements of the backup withholding rules. A U.S. Holder that does not
provide us with a correct taxpayer identification number may also be subject to
penalties imposed by the IRS. A U.S. Holder may obtain a credit for or, to the
extent entitled, a refund of any amounts withheld under the backup withholding
rules, provided the appropriate documentation is provided to the IRS. In
addition, we may be required to withhold a portion of any capital gain dividends
we make to any U.S. Holders who fail to certify their non-foreign status to us.
Tax-Exempt Stockholders
A distribution we make to a tax-exempt employee pension trust or other
domestic tax-exempt stockholder generally will not constitute "unrelated
business taxable income," or UBTI, unless the stockholder has borrowed funds to
acquire or carry our stock. A qualified trust, however, that holds more than 10%
by value of the shares of a pension-controlled REIT may be required in certain
circumstances to treat a certain percentage of that REIT's distributions as
UBTI. The restrictions on ownership of stock in our charter generally will
prevent application of the provisions treating a portion of our distributions as
UBTI to a tax-exempt entity holding our stock.
Non-U.S. Holders
The rules governing the U.S. federal income taxation of a Non-U.S. Holder
of our stock or other securities are complex. We intend the following discussion
to be only a summary of those rules. A Non-U.S. Holder refers to a beneficial
owner of our stock or other securities that is a nonresident alien individual,
foreign corporation, foreign trust or foreign estate. For purposes of this
discussion, "U.S. trade or business income" of a Non-U.S. Holder generally means
a dividend, a capital gain dividend, a retained net capital gain or gain on a
sale or other taxable disposition of our stock if that dividend, capital gain
dividend, retained net capital gain or gain is (i) effectively connected with
trade or business conducted by the Non-U.S. Holder within the United States and
(ii) in most cases of a resident of a country with which the United States has
an income tax treaty, attributable to a permanent establishment (or fixed base)
of the Non-U.S. Holder in the United States. A prospective Non-U.S. Holder
should consult his own tax adviser to determine the effects of federal, state,
local and foreign tax laws on an investment in our shares, including any
reporting requirements.
Taxation of Dividends. Distributions to a Non-U.S. Holder of our common or
preferred stock that are not attributable to gain from our sale or exchange of a
United States real property interest and that we do not designate as capital
gain dividends or retained net capital gain will be treated as ordinary dividend
income to the extent that they are paid out of our current or accumulated
earnings and profits, as determined for U.S. federal income tax purposes. Those
distributions generally will be subject to a withholding tax equal to 30% of the
gross amount of the
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distribution unless an applicable tax treaty reduces that tax. However, if a
dividend is U.S. trade or business income, the Non-U.S. Holder generally will be
subject to U.S. federal income tax at graduated rates in the same manner as a
U.S. Holder is taxed with respect to that dividend, and a Non-U.S. Holder that
is a corporation may also be subject to the branch profits tax at a rate of 30%
(or lower treaty rate). We expect to withhold tax at the rate of 30% of the
gross amount of any distributions we make to a Non-U.S. Holder with respect to
our stock unless:
o a lower treaty rate applies and the Non-U.S. Holder files with us an
IRS Form W-8BEN evidencing eligibility for that reduced rate, or
o the Non-U.S. Holder files an IRS Form W-8ECI with us claiming that the
distribution is U.S. trade or business income.
Any distribution we make that exceeds our current and accumulated earnings
and profits will be treated first as a tax-free return of capital, reducing the
Non-U.S. Holder's tax basis in our stock to the extent thereof, and thereafter
as gain recognized as if the Non-U.S. Holder sold our stock. Any amount treated
as gain recognized on a sale of our stock will be subject to U.S. federal income
tax if the Non-U.S. Holder would be subject to tax on an actual sale of our
stock, as discussed below. Because we generally cannot determine at the time we
make a distribution whether the distribution will exceed our current and
accumulated earnings and profits, we normally will withhold tax on the entire
amount of a distribution at the same rate we would withhold on a dividend.
However, amounts so withheld are creditable against the Non-U.S. Holder's U.S.
federal income tax liability, if any, or are refundable by the IRS to the extent
the Non-U.S. Holder has overpaid its U.S. federal income tax liability. We are
also required to withhold 10% of any distribution in excess of our current and
accumulated earnings and profits if our stock is a United States real properly
interest. As discussed below, our stock would be a United States real property
interest if we are not a domestically-controlled REIT and if our stock is not
regularly traded on an established securities market (or, even if it is so
regularly traded, stock held by a stockholder that owns, or has owned at any
time during the five-year period ending on the date of disposition, more than 5%
of our stock would be a United States real property interest). We believe that
our stock is regularly traded on an established securities market. In addition,
we believe that we should be a domestically-controlled REIT, although no
assurance can be given that we will not become, or that we are not now, a
non-domestically-controlled REIT. Although we intend to withhold at a rate of
30% on the entire amount of any distribution we pay to Non-U.S. Holders, to the
extent we do not do so, we may withhold at a rate of 10% on any portion of a
distribution not subject to withholding at a rate of 30%.
Distributions Attributable to Gain from the Sale of Exchange of a United
States Real Property Interest. Under section 897 and other related sections of
the Internal Revenue Code, also known as FIRPTA, or Foreign Investment in Real
Property Tax Act of 1980, as subsequently amended, in any taxable year we
qualify as a REIT, a Non-U.S. Holder will be subject to U.S. federal income tax
on any distribution we make that is attributable to gain from our sale or other
taxable disposition of a United States real property interest. In general, a
United States real property interest includes any interest in real property
located in the United States, other than an interest solely as a creditor. A
Non-U.S. Holder will be taxable on those gains as if they were U.S. trade or
business income. Noncorporate Non-U.S. Holders thus would be taxed at the
capital gain rates applicable to U.S. Holders, subject to the alternative
minimum tax and a special alternative minimum tax in the case of nonresident
alien individuals. Distributions subject to FIRPTA also may be subject to the
branch profits tax at a rate of 30% (or lower treaty rate) in the hands of a
Non-U.S. Holder that is a corporation. We are required to withhold tax equal to
35% of the amount of distribution to Non-U.S. Holders that we designate (or, if
greater, the amount that we could designate) as a capital gains dividend. The
amount withheld is creditable against the Non-U.S. Holder's U.S. federal income
tax liability, if any, or is refundable by the IRS to the extent it exceeds that
tax liability.
Sales of Our Stock by a Non-U.S. Holder. Gain recognized by a Non-U.S.
Holder upon a sale of our stock generally will not be subject to U.S. federal
income tax under FIRPTA if we are a domestically controlled REIT. A
domestically-controlled REIT is a REIT in which at all times during the
five-year period ending on the date of disposition less than 50% in value of the
stock was held directly or indirectly by Non-U.S. Holders. We believe that we
should be a domestically-controlled REIT and that, therefore, gain that a
Non-U.S. Holder recognizes on a sale or other taxable disposition of our stock
would not be subject to U.S. federal income tax, although we cannot provide any
assurance to that effect. Because our stock is publicly traded, we cannot assure
our investors that we are or will remain a domestically-controlled REIT. Even if
we are not a domestically-controlled REIT, however, a
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Non-U.S. Holder that does not own, actually and constructively, more than 5% of
our stock at any time during the five-year period ending on the date of
disposition will not be subject to U.S. federal income tax pursuant to FIRPTA on
any gain recognized on a sale or other taxable disposition of our stock if our
stock is traded on an established securities market, like the New York Stock
Exchange, where our stock is currently listed.
If gain recognized on a sale or other taxable disposition of our stock were
subject to tax under FIRPTA, the Non-U.S. Holder generally would be subject to
U.S. federal income tax on that gain in the same manner as would a U.S. Holder.
A purchaser of our stock from a Non-U.S. Holder will not be required to
withhold on the purchase price if our stock is regularly traded on an
established securities market or if we are a domestically-controlled REIT.
Otherwise, a purchaser of our stock generally would be required to withhold 10%
of the purchase price and remit that amount to the IRS unless the purchaser
receives appropriate certification from the seller that it is a U.S. Holder or
that another exemption from withholding applies. Our stock currently is traded
on the New York Stock Exchange. We believe that our stock is regularly traded on
an established securities market at this time. In addition, we believe that we
should not be a domestically-controlled REIT, although no assurance can be given
that we will not become, or that we are not now, a domestically-controlled REIT.
Gain recognized by a Non-U.S. Holder on a sale or other taxable disposition
of our which is not subject to FIRPTA nevertheless will be subject to U.S.
federal income tax if:
o income from the Non-U.S. Holder's investment in our stock is U.S.
trade or business income, in which case the Non-U.S. Holder will be
subject to U.S. federal income tax on that gain in the same manner as
would a U.S. Holder, subject to the alternative minimum tax, a special
alternative minimum tax in the case of nonresident alien individuals,
and the possible application of the branch profits tax at a rate of
30% (or lower treaty rate) in the case of a Non-U.S. Holder that is a
corporation, or
o the Non-U.S. Holder is a nonresident alien individual who was present
in the United States for 183 days or more during the taxable year and
other conditions are met, in which case the nonresident alien
individual will be subject to a 30% tax on the individual's net U.S.
source capital gain.
U.S. Estate Tax. Upon the death of an individual Non-U.S. Holder, that
individual's stock will be treated as part of his U.S. estate for purposes of
the U.S. estate tax, except as an applicable estate tax treaty may provide
otherwise.
Backup Withholding Tax and Information Reporting. If the proceeds of a
disposition of our stock are paid by or through a U.S. office of a
broker-dealer, the payment is generally subject to information reporting and
backup withholding unless the disposing Non-U.S. Holder certifies as to his
name, address and non-U.S. status or otherwise establishes an exemption.
Generally, U.S. information reporting and backup withholding will not apply to a
payment of disposition proceeds if the payment is made outside the United States
through a foreign office of a foreign broker-dealer. If the proceeds from a
disposition of our stock are paid to or through a foreign office of a U.S.
broker-dealer or a non-U.S. office of a foreign broker-dealer that is
o a "controlled foreign corporation" for U.S. federal income tax
purposes,
o a foreign person 50% or more of whose gross income from all sources
for a three-year period was effectively connected with trade or
business conducted by that person within the United States,
o a foreign partnership with one or more partners who are U.S. persons
and who in the aggregate hold more than 50% of the income or capital
interest in the partnership, or
o a foreign partnership engaged in the conduct of trade or business in
the United States,
(i) backup withholding will not apply unless the broker-dealer has actual
knowledge that the owner is a United States person, and (ii) information
reporting will not apply if the Non-U.S. Holder satisfies certification
requirements regarding its status as not a United States person.
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Taxation of Holders of Securities Other Than Stock
In addition to issuing common and preferred stock, from time to time we may
issue other forms of securities, including notes and warrants.
Interest payable on a note generally will be includible in the income of a
U.S. Holder in accordance with the U.S. Holder's regular method of accounting
for tax purposes. If a note is redeemed, sold or otherwise disposed of, a U.S.
Holder generally will recognize gain or loss equal to the difference between the
amount realized on the disposition of that note (to the extent that amount does
not represent accrued but unpaid interest, which will be treated as ordinary
income) and that holder's tax basis in the note. That gain or loss generally
will be capital gain (except, for example, to the extent attributable to any
accrued market discount) or capital loss, provided the U.S. Holder held the note
as a capital asset, and will be long-term capital gain or loss if the Holder
held the note for more than one year at the time of the disposition. The
character of income generated with respect to an investment in notes issued by
us is not affected by our REIT status.
Subject to the possible imposition of back-up withholding, interest on a
note paid to a Non-U.S. Holder will not be subject to U.S. federal withholding
tax if
o the beneficial owner of the note does not actually or constructively
own 10% or more of our voting stock;
o the beneficial owner of the note is not a controlled foreign
corporation related to us through share ownership;
o the beneficial owner of the note is not a bank whose receipt of
interest on the note is described in section 881(c)(3)(A) of the Code;
and
either the beneficial owner of the note certifies to us that it is not a United
States person and provides its name and address, or a financial institution that
holds customers' securities in the ordinary course of its trade or business and
holds the note certifies to us that it or a financial institution between it and
the beneficial owner has received that statement and furnishes us with a copy.
The foregoing exemption from U.S. federal withholding tax does not apply to any
note subject to the rules of section 871(h)(4)(A) of the Code relating to
interest payments that are determined by reference to the income, profits,
changes in the value of property or other attributes of the debtor or a related
party.
In general, a Non-U.S. Holder will not be subject to U.S. federal income
tax on any gain recognized on a sale, retirement or other taxable disposition of
a note. Interest on a note and gain recognized on a disposition, however, will
be subject to U.S. federal income tax if income from an investment in the note
is treated as U.S. trade or business income. In that case, the Non-U.S. Holder
generally will be subject to U.S. federal income tax at graduated rates in the
same manner as a U.S. Holder is taxed on that gain, and a Non-U.S. Holder that
is a corporation may also be subject to the branch profits tax at a rate of 30%
(or lower treaty rate). In addition, a Non-U.S. Holder that is a nonresident
alien individual who was present in the United States for 183 days or more
during the taxable year and who satisfies certain other conditions will be
subject to a 30% tax on the individual's net U.S. source capital gain.
Generally, an investor in our warrants will not recognize gain or loss on
acquisition of our stock on exercise of a warrant. Thereafter, as one of our
stockholders, that investor will have a basis in his stock equal to the sum of
his basis in the warrant plus any amount paid on exercise of the warrant.
Following exercise of a warrant, that investor will be taxed in the same manner
as other stockholders, as discussed above. If an investor chooses to sell or
otherwise dispose of a warrant prior to exercising it, that investor generally
will be treated in the same manner as an investor in our stock, as discussed
above.
The exact tax consequences of investing in any particular form of note or
warrant can vary significantly depending on the exact terms of the security. The
tax consequences of any particular security we may decide to issue will be
addressed in detail in a prospectus supplement.
46
State and Local Tax
We may be subject to state and local tax in various states and localities.
Our stockholders also may be subject to state and local tax in various states
and localities. The tax treatment to us and to our stockholders in those
jurisdictions may differ from the U.S. federal income tax treatment described
above. Consequently, before you buy our shares, you should consult your own tax
adviser regarding the effect of state and local tax laws on an investment in our
shares.
PLAN OF DISTRIBUTION
We may sell securities to one or more underwriters or dealers for public
offering and sale by them, or we may sell the securities to investors directly
or through agents. The applicable prospectus supplement will set forth the terms
of the offering and the method of distribution and will identify any firms
acting as underwriters, dealers or agents in connection with the offering,
including:
o the name or names of any underwriters;
o the purchase price of the securities;
o any underwriting discounts and other items constituting underwriters'
compensation;
o any initial public offering price and the net proceeds we will receive
from such sale;
o any discounts or concessions allowed or reallowed or paid to dealers;
and
o any securities exchange or market on which the securities offered in
the prospectus supplement may be listed.
We may distribute our securities from time to time in one or more
transactions at a fixed price or prices, which may be changed, or at prices
determined as the prospectus supplement specifies, including in "at-the-market"
offerings. We may sell our securities through a rights offering, forward
contracts or similar arrangements.
Any underwriting discounts or other compensation which we pay to
underwriters or agents in connection with the offering of our securities, and
any discounts, concessions or commissions which underwriters allow to dealers,
will be set forth in the prospectus supplement. Underwriters may sell our
securities to or through dealers, and such dealers may receive compensation in
the form of discounts, concessions or commissions from the underwriters and
commissions from the purchasers for whom they may act as agents. Underwriters,
dealers and agents that participate in the distribution of our securities may be
deemed to be underwriters under the Securities Act and any discounts or
commissions they receive from us and any profit on the resale of our securities
they realize may be deemed to be underwriting discounts and commissions under
the Securities Act. Any such underwriter or agent will be identified, and any
such compensation received from us, will be described in the applicable
supplement to this prospectus. Unless otherwise set forth in the supplement to
this prospectus relating thereto, the obligations of the underwriters or agents
to purchase our securities will be subject to conditions precedent and the
underwriters will be obligated to purchase all our offered securities if any are
purchased. The public offering price and any discounts or concessions allowed or
reallowed or paid to dealers may be changed from time to time.
Any common stock sold pursuant to this prospectus and applicable prospectus
supplement, will be approved for trading, upon notice of issuance, on the New
York Stock Exchange.
Underwriters and their controlling persons, dealers and agents may be
entitled, under agreements entered into with us to indemnification against and
contribution toward specific civil liabilities, including liabilities under the
Securities Act.
The securities being offered under this prospectus, other than our common
stock, will be new issues of securities with no established trading market and
unless otherwise specified in the applicable prospectus supplement. It has not
presently been established whether the underwriters, if any, as identified in a
prospectus supplement, will make a market in the securities. If the underwriters
make a market in the securities, the market making may be
47
discontinued at any time without notice. We cannot provide any assurance as to
the liquidity of the trading market for the securities.
An underwriter may engage in over-allotment, stabilizing transactions,
short covering transactions and penalty bids in accordance with securities laws.
Over-allotment involves sales in excess of the offering size, which creates a
short position. Stabilizing transactions permit bidders to purchase the
underlying security so long as the stabilizing bids do not exceed a specified
maximum. Short covering transactions involve purchases of the securities in the
open market after the distribution is completed to cover short positions.
Penalty bids permit the underwriters to reclaim a selling concession from a
dealer when the securities originally sold by the dealer are purchased in a
covering transaction to cover short positions. Those activities may cause the
price of the securities to be higher than it would otherwise be. The
underwriters may engage in these activities on any exchange or other market in
which the securities may be traded. If commenced, the underwriters may
discontinue these activities at any time.
Certain of the underwriters and their affiliates may be customers of,
engage in transactions with, and perform services for, us and our subsidiaries
in the ordinary course of business.
LEGAL MATTERS
Certain legal matters with respect to the validity of the securities
offered under this prospectus and any supplement hereto, as well as certain tax
matters, will be passed upon for us by Greenberg Traurig, P.A., Miami, Florida
33131. Counsel for any underwriter or agents will be noted in the applicable
prospectus supplement.
EXPERTS
Our consolidated financial statements and the related financial statement
schedule incorporated in this prospectus by reference from our annual report on
Form 10-K for the year ended December 31, 2002 have been audited by Deloitte &
Touche LLP, independent auditors, as stated in their reports which are
incorporated herein by reference, and have been so incorporated in reliance upon
the reports of such firm given upon their authority as experts in accounting and
auditing.
The consolidated financial statements of IRT Property Company, incorporated
in this prospectus by reference to our current report on Form 8-K filed on May
13, 2003 have been audited by Deloitte & Touche LLP, independent auditors, as
stated in their reports which are incorporated herein by reference, and have
been so incorporated in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms public reference room at 450 Fifth Street, N.W.
Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. The SEC maintains an internet site
that contains reports, proxy and information statements, and other information
that we file electronically with the SEC and which are available at the SEC's
web site at: http://www.sec.gov. You can also inspect reports and other
information we file at the offices of the New York Stock Exchange, 20 Broad
Street, 17th Floor, New York, New York 10005.
This prospectus is part of a registration statement that we filed with the
SEC. The registration statement contains more information than this prospectus
regarding us and our common stock, including certain exhibits. You can obtain a
copy of the registration statement from the SEC at the address listed above or
from the SEC's web site listed above.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate by reference" some of the documents we
file with it into this prospectus, which means:
o we can disclose important information to you by referring you to those
documents;
48
o the information incorporated by reference is considered to be part of
this prospectus; and
o later information that we file with the SEC will automatically update
and supersede this information.
We incorporate by reference the documents listed below:
o our Annual Report on Form 10-K for the fiscal year ended December 31,
2002;
o our Quarterly Report on Form 10-Q for the fiscal quarter ended March
31, 2003;
o our definitive Proxy Statement, filed in connection with our 2003
Annual Meeting of Stockholders;
o our Current Report on Form 8-K, filed on May 8, 2003;
o our Current Report on Form 8-K, filed on May 13, 2003;
o our Current Report on Form 8-K, filed on May 15, 2003; and
o the description of our common stock filed as part of our Registration
Statement (File No. 001-13499) on Form 8-A filed on October 15, 1997.
All documents filed pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act after the date of this prospectus and prior to the termination of
this offering shall be deemed to be incorporated by reference in this prospectus
and to be part of this prospectus from the date they are filed. In addition, all
documents filed pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act after the date of the initial registration statement and prior to the
effectiveness of the registration statement of which this prospectus forms a
part shall be deemed to be incorporated by reference in this prospectus and to
be part of this prospectus from the date they are filed. In no event, however,
will any of the information that we disclose under Item 9 or Item 12 of any
Current Report on Form 8-K that we may from time to time furnish to the SEC be
incorporated by reference into, or otherwise included in, this prospectus.
We will provide without charge to each person, including any stockholder,
to whom a prospectus is delivered, upon written or oral request of that person,
a copy of any and all of the information that has been incorporated by reference
in this prospectus (excluding exhibits unless specifically incorporated by
reference into those documents). Please direct requests to us at the following
address:
Equity One, Inc.
1696 N.E. Miami Gardens Drive
North Miami Beach, Florida 33179
Attention: Investor Relations
(305) 947-1664
49
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______________, 2003
EQUITY ONE, INC.
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P R O S P E C T U S
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We have not authorized any dealer, salesperson or other person to give you
written information other than this prospectus or to make representations as to
matters not stated in this prospectus. You must not rely on unauthorized
information. This prospectus is not an offer to sell these securities or our
solicitation of your offer to buy the securities in any jurisdiction where that
would not be permitted or legal. Neither the deliver of this prospectus nor any
of the sales made hereunder after the date of this prospectus shall create an
implication that the information contained herein or our affairs have not
changed since the date hereof.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The estimated expenses in connection with the offering are as follows:
Securities and Exchange Commission Registration Fee.............. $ 48,540
Legal Fees and Expenses.......................................... $ 55,000
Accounting Fees and Expenses..................................... $ 55,000
Printing and Engraving Expenses.................................. $ 50,000
Miscellaneous.................................................... $ 16,460
---------
Total........................................................ $ 225,000
=========
All amounts except the Securities and Exchange Commission registration fee
are estimated.
Item 15. Indemnification of Directors and Officers.
The Maryland General Corporation Law permits a Maryland corporation to
include in its charter a provision limiting the liability of its directors and
officers to the corporation and its stockholders for money damages except for
liability resulting from (a) actual receipt of an improper benefit or profit in
money, property or services or (b) active and deliberate dishonesty established
by a final judgment as being material to the cause of action. Our charter
contains such a provision which limits such liability to the maximum extent
permitted by Maryland law. This provision does not limit our ability, or our
stockholders ability, to obtain other relief, such as an injunction or
rescission.
Our charter and bylaws authorize and obligate us, to the maximum extent
permitted by Maryland law, to indemnify and to pay or reimburse reasonable
expenses in advance of final disposition of a proceeding to any present or
former director or officer who is made a party to the proceeding by reason of
his service in that capacity or any individual who, while serving as a director
on our board, and at our request, serves or has served another corporation,
REIT, partnership, joint venture, trust, employee benefit plan or any other
enterprise as a director, officer, partner or trustee of such corporation, REIT,
partnership, joint venture, trust, employee benefit plan or other enterprise and
who is made a party to the proceeding by reason of his service in that capacity.
The charter and bylaws also permit us to indemnify and advance expenses to any
person who served a predecessor to us in any of the capacities described above
and to any of our employees or agents, or employees or agents of a predecessor.
Maryland law requires a corporation, unless its charter provides otherwise,
which our charter does not, to indemnify a director or officer who has been
successful, on the merits or otherwise, in the defense of any proceeding to
which he is made a party by reason of his service in that capacity. Maryland law
also permits a corporation to indemnify its present and former directors and
officers, among others, against judgments, penalties, fines, settlements and
reasonable expenses actually incurred by them in connection with any proceeding
to which they may be made a party by reason of their service in those or other
capacities unless it is established that the act or omission of the director or
officer was material to the matter giving rise to the proceeding and was
committed in bad faith or was the result of active and deliberate dishonesty,
the director or officer actually received an improper personal benefit in money,
property or services or in the case of any criminal proceeding, the director or
officer had reasonable cause to believe that the act or omission was unlawful.
However, under Maryland law, a Maryland corporation may not indemnify for an
adverse judgment in a suit by or in the right of the corporation or for a
judgment of liability on the basis that a personal benefit was improperly
received, unless in either case a court orders indemnification and then only for
expenses. In addition, Maryland law permits a corporation to advance reasonable
expenses to a director or officer upon our receipt of a written affirmation by
the director or officer of his good faith belief that he has met the standard of
conduct necessary for indemnification by us and a written undertaking by him or
on his behalf to repay the amount paid or reimbursed by us if it shall
ultimately be determined that the standard of conduct was not met. The
termination of any proceeding by conviction, or upon a plea of nolo contendere
or its
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equivalent, or an entry of any order of probation prior to judgment, creates a
rebuttable presumption that the director or officer did not meet the requisite
standard of conduct required for indemnification to be permitted.
We have entered into indemnification agreements with each member of the
board of directors. The indemnification agreements require, among other things,
that we indemnify to the fullest extent permitted by law and advance to each
indemnified director all related expenses, subject to reimbursement if it is
subsequently determined that indemnification is not permitted. Under the
indemnification agreements, we must also indemnify and advance all expenses
incurred by an indemnified director seeking to enforce his rights under the
indemnification agreements and may cover executive officers and directors under
our directors' and officers' liability insurance. Although the form of
indemnification agreement offers substantially the same scope of coverage
afforded by law, it provides greater assurance to directors and executive
officers that indemnification will be available, because, as a contract, it
cannot be modified unilaterally in the future by the board of directors or the
stockholders to eliminate the rights it provides.
It is the position of the Securities and Exchange Commission that
indemnification of directors and officers for liabilities arising under the
Securities Act is against public policy and is unenforceable pursuant to Section
14 of the Securities Act.
Item 16. Exhibits
Exhibit
Number Description
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1.1 Form of Underwriting Agreement with respect to equity securities.
1.2 Form of Underwriting Agreement with respect to debt securities.
4.1 Form of Stock Certificate (incorporated by reference to exhibit 4.1 to
the Registration Statement on Form S-11, as amended, filed on August
20, 1997, SEC File No. 333-33977).
4.2 Form of Preferred Stock.*
4.3 Form of Deposit Agreement (Form of Receipt included therein).*
4.4 Indenture dated September 9, 1998 between the Company, as
successor-by-merger to IRT Property Company, and SunTrust Bank, as
Trustee. (Exhibit 4.2) (1)
4.5 Supplemental Indenture No. 1 dated September 9, 1998 between the
Company, as successor-by-merger to IRT Property Company, and SunTrust
Bank, as Trustee. (Exhibit 4.3) (1)
4.6 Supplemental Indenture No. 2 dated November 1, 1999 between the
Company, as successor-by-merger to IRT Property Company, and SunTrust
Bank, as Trustee. (Exhibit 4.5) (2)
4.7 Supplemental Indenture No. 3 dated February 12, 2003 between the
Company and SunTrust Bank, as Trustee. (Exhibit 4.2) (3)
4.8 Form of Supplemental Indenture No. 4 between the Company, the
Guarantors to be named therein and SunTrust Bank, as Trustee.
4.9 Agreement of Limited Partnership of IRT Partners, L.P., including the
First Amendment to such Agreement. (Exhibit 99.2) (1)
4.10 Form of Officer's Certificate relating to offered debt securities,
including form of offered debt securities. *
4.11 Form of Warrant Agreement (Form of Warrant included therein).*
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Exhibit
Number Description
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5.1 Opinion of Greenberg Traurig, P.A. regarding the legality of the
offered securities.
8.1 Opinion of Greenberg Traurig, P.A. as to certain federal income
taxation matters.
12.1 Statements regarding Computation of Ratios of Earnings to Fixed
Charges and Preferred Stock Dividends
23.1 Consent of Deloitte & Touche LLP (Equity One, Inc.).
23.2 Consent of Deloitte & Touche LLP (IRT Property Company)
23.3 Consent of Greenberg Traurig, P.A. (contained in legal opinion filed
as Exhibit 5.1).
23.4 Consent of Greenberg Traurig, P.A. (contained in legal opinion filed
as Exhibit 8.1).
24.1 Powers of Attorney (included on signature pages hereto).
25.1 Statement of Eligibility and Qualification of Trustee on Form T-1
under Trust Indenture Act of 1939, as amended, of SunTrust Bank as
trustee under the Indenture.
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* To be filed by amendment or as an exhibit to a document to be incorporated
by reference herein in connection with an offering of the offered
securities.
(1) Previously filed by IRT Property Company as an exhibit to IRT's Current
Report on Form 8-K filed on September 15, 1998, and incorporated by
reference herein (SEC File No. 001-07859).
(2) Previously filed by IRT Property Company as exhibit 4.5 to IRT's Current
Report on Form 8-K filed on November 12, 1999, and incorporated by
reference herein.
(3) Previously filed as exhibit 4.2 to the Company's Current Report on Form 8-K
filed on February 20, 2003, and incorporated by reference herein (SEC File
No. 001-13499).
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, and in the aggregate, the
changes in volume and price represent no more than 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement.
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
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provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the registration statement is on Form S-3, Form S-8 or Form F-3,
and the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at the time shall be deemed to be the initial bona
fide offering thereof, and
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(a) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(b) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been, settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
(c) The undersigned registrants hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act, the information omitted from the form prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(2) For purposes of determining any liability under the
Securities Act, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities as that time shall be
deemed to be the initial bona fide offering thereof.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Miami, State of Florida, on July 9, 2003.
EQUITY ONE, INC.
By: /s/ Chaim Katzman
----------------------------
Chaim Katzman
Chairman and Chief Executive Officer
The following direct and indirect subsidiaries of the registrant may
guarantee the debt securities and are co-registrants under this registration
statement.
CO-REGISTRANTS
Bandera Festival GP, LLC
Beechnut Centre Corp.
Benbrook Centre Corp.
Bend Shopping Centre Corp.
Cashmere Developments, Inc.
Centerfund (US), LLC
Centrefund Acquisition (Texas) Corp.
Centrefund Acquisition Corp.
Centrefund Development (Gainesville) LLC
Centrefund Realty (U.S.) Corporation
Colony GP, LLC
Copperfield Crossing, Inc.
East Townsend Square, Inc.
Eastbelt Centre Corp.
Equity (Landing) Inc.
Equity One (147) Inc.
Equity One (Alpha) Corp.
Equity One (Atlantic Village) Inc.
Equity One (Beauclerc) Inc.
Equity One (Beta) Inc.
Equity One (Butler Creek) Inc.
Equity One (Clematis) LLC
Equity One (Commonwealth) Inc.
Equity One (Coral Way) Inc.
Equity One (Delta) Inc.
Equity One (El Novillo) Inc.
Equity One (Eustis Square) Inc.
Equity One (Forest Edge) Inc.
Equity One (Forest Village Phase II) Inc.
Equity One (Gamma) Inc.
Equity One (Lantana) Inc.
Equity One (Losco) Inc.
Equity One (Mandarin) Inc.
Equity One (Monument) Inc.
Equity One (North Port) Inc.
Equity One (Oak Hill) Inc.
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
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Equity One (Olive) Inc.
Equity One (Point Royale) Inc.
Equity One (Sheridan) Inc.
Equity One (Sky Lake) Inc.
Equity One (Summerlin) Inc.
Equity One (Walden Woods) Inc.
Equity One (West Lake) Inc.
Equity One Acquisition Corp.
Equity One Construction, Inc.
Equity One Properties, Inc.
Equity One Realty & Management Texas, Inc.
Equity One Realty & Management FL, Inc.
Equity One Realty & Management SE, Inc.
Equity Texas Properties, LLC
FC Market GP, LLC
Florida Del Rey Holdings II, Inc.
Forestwood Equity Partners GP, LLC
Garland & Barns, LLC
Garland & Jupiter, LLC
Gazit (Meridian) Inc.
Grogan Centre Corp.
Harbour Barker Cypress GP, LLC
Hedwig GP, LLC
Homestead Market Center, Inc.
IRT Alabama, Inc.
IRT Capital Corporation II
IRT Management Company
KirkBiss GP, LLC
Leesburg DrugStore, LLC
Mariner Outparcel, Inc.
Mason Park GP, LLC
McMinn Holdings, Inc.
North Kingwood Centre Corp.
Oakbrook Square Shopping Center Corp.
Parcel F, LLC
Plymouth South Acquisition Corp.
Prosperity Shopping Center Corp.
PSL Developments, Inc.
Ryanwood Shopping Center, L.L.C.
SA Blanco Village Partners GP, LLC
Salerno Village Shopping Center, LLC
Shoppes at Jonathan's Landing, Inc.
Shoppes at Westbury Shopping Center, Inc.
South Kingwood Centre Corp.
Southwest 19 Northern, Inc.
Spring Shadows GP, LLC
St. Charles Outparcel, Inc.
Steeplechase Centre Corp.
Texas Equity Holdings LLC
The Harbor Center, Inc.
The Meadows Shopping Center, LLC
The Shoppes of Eastwood, LLC
UIRT GP, L.L.C.
UIRT I - Centennial, Inc.
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
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UIRT LP, L.L.C.
UIRT-Northwest Crossing, Inc.
VW Mall, Inc.
Wickham DrugStore, LLC
Wimbledon Center Corp.
Wickham DrugStore, LLC
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
Bandera Festival Partners, LP
By: Bandera Festival GP, LLC
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
BC Centre Partners, LP
By: Harbour Barker Cypress GP, LLC
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
Beechnut Centre I L.P.
By: Beechnut Centre Corp.
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
Bend Shopping Centre I L.P.
By: Bend Shopping Centre Corp.
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
Eastbelt Centre I L.P.
By: Eastbelt Centre Corp.
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
FC Market Partners, LP
By: FC Market GP, LLC
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
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Grogan Centre I L.P.
By: Grogan Centre Corp.
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
Hedwig Partners, LP
By: Hedwig GP, LLC
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
IRT Partners L.P.
By: Equity One, Inc.
By: /s/ Chaim Katzman
------------------------------------
Chaim Katzman
Chairman and Chief Executive Officer
Kirkwood - Bissonnet Partners, LP
By: KirkBiss GP, LLC
By: /s/ Chaim Katzman
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Chaim Katzman
President
Mason Park Partners, LP
By: Mason Park GP, LLC
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
Park Northern/Centennial Partners, L.P.
By: UIRT I - Centennial, Inc.
By: /s/ Chaim Katzman
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Chaim Katzman
President
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SA Blanco Village Partners, LP
By: SA Blanco Village Partners GP, LLC
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
Steeplechase Centre I L.P.
By: Steeplechase Centre Corp.
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
Texas CP Land, LP
By: Colony GP, LLC
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
Texas Spring Shadows Partners, LP
By: Spring Shadows GP, LLC
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
UIRT, Ltd.
By: UIRT GP, LLC
By: /s/ Chaim Katzman
-------------------------
Chaim Katzman
President
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Chaim Katzman and Howard M. Sipzner his
true and lawful attorneys-in-fact, each acting alone, with full powers of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any or all amendments, including any
post-effective amendments, to this Registration Statement, and to file the same,
with exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming all that
said attorneys-in-fact or their substitutes, each acting alone, may lawfully do
or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed
Signature Title Date
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Chairman of the Board and
/s/ Chaim Katzman Chief Executive Officer July 9, 2003
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Chaim Katzman(1)
Chief Financial Officer and
/s/ Howard M. Sipzner Principal Accounting Officer July 9, 2003
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Howard M. Sipzner(2)
/s/ Doron Valero Director July 9, 2003
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Doron Valero(3)
/s/ Robert Cooney Director July 9, 2003
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Robert Cooney
Director July 9, 2003
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Patrick Flinn
Director July 9, 2003
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Nathan Hetz
/s/ Peter Linneman Director July 9, 2003
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Peter Linneman
Director July 9, 2003
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Noam Ben Ozer
/s/ Shaiy Pilpel Director July 9, 2003
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Shaiy Pilpel
/s/ Dori Segal Director July 9, 2003
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Dori Segal
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1 Also serves as a Director and the President and Secretary of each of the
Co-Registrants (or in the case of a limited partnership, of the general
partner).
2 Also serves as principal financial and accounting officer of each of the
Co-Registrants (or in the case of the limited partnership, of the general
partner).
3 Also serves as a Director and Vice President of each of the Co-Registrants
(or in the case of a limited partnership, of the general partner).
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INDEX TO EXHIBITS
Exhibit Description
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1.1 Form of Underwriting Agreement with respect to equity securities.
1.2 Form of Underwriting Agreement with respect to debt securities.
4.8 Form of Supplemental Indenture No. 4 between the Company, the
Guarantors to be named therein and SunTrust Bank, as Trustee.
5.1 Opinion of Greenberg Traurig, P.A. regarding the legality of the
offered securities.
8.1 Opinion of Greenberg Traurig, P.A. as to certain federal income
taxation matters.
12.1 Statements regarding Computation of Ratios of Earnings to Fixed
Charges and Preferred Stock Dividends.
23.1 Consent of Deloitte & Touche LLP (Equity One, Inc.).
23.2 Consent of Deloitte & Touche LLP (IRT Property Company).
25.1 Statement of Eligibility and Qualification of Trustee on Form T-1
under Trust Indenture Act of 1939, as amended, of SunTrust Bank as
trustee under the Indenture.
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