National Storage Affiliates Trust (NYSE:NSA) Files An 8-K Entry into a Material Definitive AgreementItem 3.03. Entry into a Material Definitive Agreement.
The information in Item 3.03 under the heading "Partnership Amendment" below is incorporated into this Item 3.03 by reference.
Item 3.03. Material Modifications to Rights of Security Holders.
On October10, 2017, National Storage Affiliates Trust, a Maryland real estate investment trust (the “Company”) filed with the State Department of Assessments and Taxation of the State of Maryland Articles Supplementary (the “Articles Supplementary”) to the Company’s Articles of Amendment and Restatement, classifying and designating 6,900,000 of the Company’s authorized equity shares as 6.000% Series A Cumulative Redeemable Preferred Shares of Beneficial Interest, par value $0.01 per share (“Series A Preferred Shares”). As set forth in the Articles Supplementary, the Series A Preferred Shares rank senior to the Company’s common shares of beneficial interest, par value $0.01 per share (“Common Shares”), on parity with the Company’s future equity shares that the Company may later authorize or issue and that by their terms are on a parity with the Series A Preferred Shares, and junior to any other class of the Company’s shares expressly designated as ranking senior to the Series A Preferred Shares. Holders of Series A Preferred Shares, when and as authorized by the board of trustees of the Company, are entitled to cumulative cash dividends at the rate of 6.000%per annum of the $25.00 per share liquidation preference per share, equivalent to $1.50 per annum per share. Dividends are payable quarterly in arrears on or about the last day of March, June, September and December of each year, beginning on December31, 2017. In addition to other preferential rights, the holders of Series A Preferred Shares are entitled to receive the liquidation preference, which is $25.00 per share, before the holders of Common Shares in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Company’s affairs.
Generally, Series A Preferred Shares are not redeemable by the Company prior to October11, 2022. However, upon the occurrence of a “Change of Control” (as defined below), holders of Series A Preferred Shares will have the right (unless, prior to the Change of Control Conversion Date (as defined below), the Company has provided or provides notice of its election to redeem the Series A Preferred Shares) to convert some or all of the Series A Preferred Shares (the “Change of Control Conversion Right”) into a number of Common Shares per Series A Preferred Share to be converted equal to the lesser of:
the quotient obtained by dividing (i)the sum of the $25.00 liquidation preference plus the amount of any accrued and unpaid dividends to, but not including, the Change of Control Conversion Date (unless the Change of Control Conversion Date is after a record date for a Series A preferred share dividend payment and prior to the corresponding Series A preferred share dividend payment date, in which case no additional amount for such accrued and unpaid dividend will be included in this sum) by (ii)the Common Share Price (as defined below); and
2.04666 (the “Share Cap”), subject to certain adjustments;
subject, in each case, to provisions for the receipt of alternative consideration, as described in the Articles Supplementary.
If, on or prior to the Change of Control Conversion Date, the Company has provided or provides a redemption notice, whether to the Company’s special optional redemption right in connection with a Change of Control or the Company’s optional redemption right, holders of Series A Preferred Shares will not have
any right to convert their Series A Preferred Shares in connection with the Change of Control Conversion Right and any Series A Preferred Shares subsequently selected for redemption that have been tendered for conversion will be redeemed on the related date of redemption instead of converted on the Change of Control Conversion Date.
A “Change of Control” is when, after the original issuance of the Series A Preferred Shares, the following have occurred and are continuing:
the acquisition by any person, including any syndicate or group deemed to be a "person" under Section13(d)(3) of the Securities Exchange Act of 1934 (as amended, the "Exchange Act"), of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of purchases, mergers or other acquisition transactions of shares of the Company entitling that person to exercise more than 50% of the total voting power of all shares of the Company entitled to vote generally in elections of trustees (except that such person will be deemed to have beneficial ownership of all securities that such person has the right to acquire, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition); and
following the closing of any transaction referred to in the bullet point above, neither the Company nor the acquiring or surviving entity (or if, in connection with such transaction, common shares are converted into or exchangeable for (in whole or in part) common equity securities of another entity, such other entity) has a class of common equity securities (or American Depositary Receipts representing such securities) listed on the New York Stock Exchange ("NYSE"), the NYSE American, LLC ("NYSE AMER") or the NASDAQ Stock Market ("NASDAQ") or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE AMER or NASDAQ.
The “Change of Control Conversion Date” is the date the Series A Preferred Shares are to be converted, which will be a business daythat is no fewer than 20days nor more than 35days following the date on which the Company provides the required notice of the occurrence of a Change of Control to the holders of Series A Preferred Shares.
The “Common Share Price” will be: (i)if the consideration to be received in the Change of Control by holders of the Company’s Common Shares is solely cash, the amount of cash consideration per Common Share, or (ii)if the consideration to be received in the Change of Control by holders of the Company’s Common Shares is other than solely cash, (x) the average of the closing price per Common Share (or, if no closing sale price is reported, the average of the closing bid and ask prices, or if more than one in either case, the average of the average closing bid and the average closing ask prices) for the ten consecutive trading days immediately preceding, but not including, the effective date of the Change of Control as reported on the principal U.S. securities exchange on which the Company's Common Shares are then traded, or (y) the average of the last quoted bid prices for the Company's Common Shares in the over-the-counter market as reported by OTC Markets Group, Inc. or similar organization for the ten consecutive trading days immediately preceding, but not including, the effective date of the Change of Control, if the Company's Common Shares are not then listed for trading on a U.S. securities exchange.
A complete description of the Series A Preferred Shares is contained in the Articles Supplementary incorporated by reference as Exhibit3.1 to this Current Report on Form 8-K.
On October11, 2017, the Company, as General Partner of NSA OP, LP, its operating partnership subsidiary (the “Operating Partnership”), executed an amendment to its Third Amended and Restated Agreement of Limited Partnership dated April 28, 2015, as amended (the “OP Agreement”), among other things, creating a series of preferred units (the “Series A Preferred Units”) that mirrors the rights and preferences of the Series A Preferred Shares described above. At the closing of the offering, the proceeds were contributed by the Company to the Operating Partnership in exchange for 6,900,000 Series A Preferred Units. This description of the material terms of the amendment to the Partnership Agreement is qualified in its entirety by reference to the amendment to the Partnership Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is hereby incorporated by reference into this Item 3.03.
Item 3.03Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year
Information about the Articles Supplementary under Item 3.03 of this Current Report on Form 8-K is incorporated by reference into this Item 3.03.
Item 3.03Other Events
On October 11, 2017, the Company completed an underwritten public offering of 6,900,000 Series A Preferred Shares (the “Offering”), for net proceeds of approximately $166,566,250 after deducting the underwriting discount and other estimated offering expenses. The Offering was made to the Company’s effective registration statement on Form S-3 (File No. 333-211570), a base prospectus, dated June 8, 2016, included as part of the registration statement, and a prospectus supplement, dated October 3, 2017, filed with the Securities and Exchange Commission to Rule 424(b) under the Securities Act of 1933, as amended. Attached hereto as Exhibit 5.1 is the opinion of Clifford Chance US LLP relating to the legality of the Series A Preferred Shares issued in connection with the closing of the offering.
Item 3.03 Financial Statements and Exhibits
National Storage Affiliates Trust ExhibitEX-5.1 2 ex51ccopinionpreferred.htm EXHIBIT 5.1 Exhibit Exhibit 5.1CLIFFORD CHANCE US LLP 31 WEST 52ND STREETNEW YORK,…To view the full exhibit click
About National Storage Affiliates Trust (NYSE:NSA)
National Storage Affiliates Trust is an integrated, self-administered and self-managed real estate investment trust. The Company is focused on the ownership, operation and acquisition of self-storage properties located within various metropolitan statistical areas (MSAs) across the United States. The Company’s segment consists of investments in self-storage properties located in the United States. The Company’s operating partnership subsidiary is NSA OP, LP. The Company holds interests in a geographically diversified portfolio of approximately 280 self-storage properties, located in over 20 states, comprising approximately 15.8 million rentable square feet, configured in over 123,000 storage units. It has approximately six participating regional operators (PROs), including SecurCare Self Storage, Inc.; Kevin Howard Real Estate Inc.; Optivest Properties LLC; Guardian Storage Centers LLC; Move It Self Storage, and Arizona Mini Storage Management Company.