Item 3.03.
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Material Modifications to Rights of Security Holders.
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On October 12, 2016, the
Company filed, with the State Department of Assessments and Taxation of the State of Maryland, Articles Supplementary (the Articles Supplementary) to the Articles of Amendment and Restatement of the Company classifying and designating
6,210,000 shares of the Companys authorized preferred stock, par value $0.01 per share, as the Series A Preferred Stock, with the powers, designations, preferences and other rights as set forth therein.
The Articles Supplementary, among other things, provide that the Company will pay cumulative cash dividends on the Series A Preferred Stock
when and as declared by the Companys Board of Directors from, and including, October 14, 2016, at a rate of 8.00% per annum of the $25.00 liquidation preference per share (equivalent to the fixed annual rate of $2.00 per share).
Dividends on the Series A Preferred Stock will be payable quarterly in arrears on the 30
th
day of each December, March, June and September, when and as declared, beginning on December 30,
2016 (provided that if any dividend payment date is not a business day, then the dividend which would otherwise have been payable on that dividend payment date may be paid on the next succeeding business day).
The Series A Preferred Stock ranks senior to the Companys common stock, $0.01 par value per share (Common Stock), with
respect to the payment of dividends and rights upon the voluntary or involuntary liquidation, dissolution or winding up of the Company.
The Series A Preferred Stock will not be redeemable before October 30, 2021, except under certain limited circumstances intended to
preserve the Companys qualification as a real estate investment trust (REIT) and except upon the occurrence of a Change of Control (as defined in the Articles Supplementary). On or after October 30, 2021, the Company may, at
its option, redeem, in whole or in part, at any time or from time to time, the Series A Preferred Stock at redemption price of $25.00 per share, plus any accumulated and unpaid dividends thereon (whether or not authorized or declared) to, but
excluding, the redemption date. In addition, upon the occurrence of a Change of Control, the Company may, at its option, redeem some or all of the shares of Series A Preferred Stock, in whole or in part, within 120 days after the first date on which
such Change of Control occurred at $25.00 per share plus any accumulated and unpaid dividends to, but excluding, the redemption date. The Series A Preferred Stock has no stated maturity, is not subject to any sinking fund or mandatory redemption and
will remain outstanding indefinitely unless repurchased or redeemed by the Company or converted into Common Stock in connection with a Change of Control by the holders of Series A Preferred Stock.
Upon the occurrence of a Change of Control, each holder of Series A Preferred Stock will have the
right (subject to the Companys election to redeem the Series A Preferred Stock in whole or in part, as described above, prior to the Change of Control Conversion Date (as defined in the Articles Supplementary)) to convert some or all of the
Series A Preferred Stock held by such holder on the Change of Control Conversion Date into a number of shares of the Common Stock per share of Series A Preferred Stock determined by formula, in each case, on the terms and subject to the conditions
described in the Articles Supplementary, including provisions for the receipt, under specified circumstances, of alternative consideration.
There are restrictions on ownership of the Series A Preferred Stock intended to preserve the Companys qualification as a REIT. Holders
of Series A Preferred Stock generally have no voting rights, but have limited voting rights if the Company fails to pay dividends for six or more full quarterly dividend periods (whether or not consecutive) and under certain other circumstances.
A copy of the Articles Supplementary and Form of Series A Preferred Stock Certificate are filed as Exhibits 3.1 and 4.1, respectively, to
this Current Report on Form 8-K and incorporated herein by reference. The description of the terms of the Articles Supplementary in this Item 3.03 is qualified in its entirety by reference to Exhibit 3.1