EXHIBIT 3.3
GLADSTONE COMMERCIAL CORPORATION
ARTICLES SUPPLEMENTARY
ESTABLISHING AND FIXING THE RIGHTS AND
PREFERENCES OF
7.75% SERIES A CUMULATIVE REDEEMABLE PREFERRED STOCK
Gladstone Commercial Corporation, a corporation organized and existing under the laws of the
State of Maryland (the
Company
), certifies to the State Department of Assessments and Taxation of
Maryland (the
Department
) that:
FIRST
: Pursuant to the authority expressly vested in the Board of Directors of the Company
(sometimes referred to herein as the
Board
) by Article VII of the Articles of Amendment and
Restatement to Articles of Incorporation (the
Charter
) of the Company and Section 2-105 of the
Maryland General Corporation Law (
MGCL
), the Board of Directors of the Company, on January 10,
2006, adopted resolutions authorizing the Company, among other things, to issue up to a stated
maximum number of shares of preferred stock, par value $0.001 per share (the
Preferred Stock
), of
the Company, having a stated maximum aggregate liquidation preference and dividend rate and certain
other stated terms applicable to the issuance thereof, and appointing, pursuant to the MGCL and the
powers contained in the Bylaws of the Company, a committee (the
Committee
) of the Board of
Directors comprised of Messrs. Dullum and Parker and Ms. English and delegating to the Committee,
to the fullest extent permitted by Maryland law and the Charter and Bylaws of the Company, all
powers of the Board of Directors with respect to classifying, authorizing, approving, ratifying
and/or confirming the terms of the Preferred Stock to be issued, including, without limitation, the
preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends
and other distributions, qualifications and terms and conditions of redemption, and determining the
consideration per share to be received in respect of the issuance and sale of each share of
Preferred Stock to be issued and sold, and the number of shares of Preferred Stock to be so
classified or reclassified and issued by the Company, subject to the limitations set forth in the
resolutions of the Board of Directors adopted on January 10, 2006.
SECOND
: Pursuant to the authority conferred upon the Committee as aforesaid, the Committee has
on January 18, 2006, adopted resolutions classifying and designating as a separate class of
Preferred Stock the 7.75% Series A Cumulative Redeemable Preferred Stock, with the preferences,
conversions and other rights, voting powers, restrictions, limitations as to distributions,
qualifications and terms and conditions of redemption and other terms and conditions of such 7.75%
Series A Cumulative Redeemable Preferred Stock (within the limitations set by the Board of
Directors in the resolutions adopted on January 10, 2006 and referred to in Article First of these
Articles Supplementary) and establishing 1,150,000 as the number of shares to be so classified and
designated, and authorizing the issuance of up to 1,150,000 shares of 7.75% Series A Cumulative
Redeemable Preferred Stock.
THIRD
: The separate class of Preferred Stock of the Company created by the resolutions duly
adopted by the Board of Directors of the Company and by the Committee and referred to in Articles
First and Second of these Articles Supplementary shall have the designation, number of shares,
preferences, conversion and other rights, voting powers, restrictions and limitations as to
dividends, qualifications, terms and conditions of redemption and other terms and conditions as
follows (and which, upon any restatement of the Charter, may be made a part of Article VII thereof,
with any necessary or appropriate changes to the numeration or lettering of the sections or
subsections hereof):
1.
Designation and Number
. A class of Preferred Stock, designated the 7.75% Series A
Cumulative Redeemable Preferred Stock (the
Series A Preferred Stock
), is hereby established. The
number of shares of Series A Preferred Stock shall be 1,150,000 (the
Series A Preferred Shares
).
2.
Rank
. The Series A Preferred Stock, with respect to dividend rights and rights upon
liquidation, dissolution or winding up of the Company, will rank (i) senior to all classes or
series of common stock of the Company, $0.001 par value per share (the
Common Stock
), and to all
equity securities ranking junior to the Series A Preferred Stock with respect to dividend rights or
rights upon liquidation, dissolution or winding up of the Company; (ii) on a parity with all equity
securities issued by the Company the terms of which specifically provide that such equity
securities rank on a parity with the Series A Preferred Stock with respect to dividend rights or
rights upon liquidation, dissolution or winding up of the Company (the
Parity Preferred
Securities
); and (iii) junior to all existing and future indebtedness of the Company. The term
equity securities does not include convertible debt securities.
3.
Dividends
.
(a) Holders of shares of the Series A Preferred Stock are entitled to receive, when and as
declared by the Board of Directors (or a duly authorized committee thereof), out of funds legally
available for the payment of dividends, preferential cumulative cash dividends at the rate of 7.75%
per annum of the $25.00 liquidation preference (the
Liquidation Preference
) per share (equivalent
to a fixed annual amount of $1.9375 per share). Dividends on the Series A Preferred Stock shall be
cumulative from the date of original issue and shall be payable monthly in arrears on or before the
30th day of each month (each, a
Dividend Payment Date
). The first dividend, which will be
payable on February 28, 2006, will be for a full month. Such dividend and any dividend payable on
the Series A Preferred Stock for any partial dividend period will be computed on the basis of a
360-day year consisting of twelve thirty-day months. Dividends will be payable to holders of
record as they appear in the stock records of the Company at the close of business on the
applicable record date, which shall be such date designated by the Board of Directors of the
Company that is not more than 20 nor less than 10 days prior to such Dividend Payment Date (each, a
"
Dividend Record Date
).
(b) No dividends on shares of Series A Preferred Stock shall be authorized by the Board of
Directors or paid or set apart for payment by the Company at such time as the terms and provisions
of any agreement of the Company, including any agreement relating to its indebtedness, prohibits
such authorization, payment or setting apart for payment or provides that such authorization,
payment or setting apart for payment would constitute a breach thereof or a default thereunder, or
if such authorization or payment shall be restricted or prohibited by law.
(c) Notwithstanding the foregoing, dividends on the Series A Preferred Stock will accumulate
whether or not the Company has earnings, whether or not restrictions exist in respect thereof,
whether there are funds legally available for the payment of such dividends and whether or not such
dividends are declared. Accumulated but unpaid dividends on the Series A Preferred Stock will not
bear interest and holders of the Series A Preferred Stock will not be entitled to any distributions
in excess of full cumulative dividends described above. Except as set forth in the next sentence,
no dividends will be declared or paid or set apart for payment on any capital stock of the Company
or any other series of Parity Preferred Stock or any series or class of equity securities ranking
junior to the Series A Preferred Stock (other than a dividend in shares of the Companys Common
Stock or in shares of any other class of stock ranking junior to the Series A Preferred Stock as to
dividends and upon liquidation) for any period unless full cumulative dividends have been or
contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof is
set apart for such payment on the Series A Preferred Stock for all past dividend periods and the
then current dividend period. When dividends are not paid in full (or a sum sufficient for such
full payment is not so set apart) upon
the Series A Preferred Stock and the shares of any other
series of Parity Preferred Stock, all dividends declared upon the Series A Preferred Stock and any
other series of Parity Preferred Stock, shall be declared pro rata so that the amount of dividends
declared per share of Series A Preferred Stock and such other series of Parity Preferred Stock
shall in all cases bear to each other the same ratio that accumulated dividends per share on the
Series A Preferred Stock and such other series of Parity Preferred Stock (which shall not include
any accrual in respect of unpaid dividends for prior dividend periods if such Parity Preferred
Stock does not have a cumulative dividend) bear to each other.
(d) Except as provided in the immediately preceding paragraph, unless full cumulative
dividends on the Series A Preferred Stock have been or contemporaneously are declared and paid or
declared and a sum sufficient for the payment thereof is set apart for payment for all past
dividend periods and the then current dividend period, no dividends (other than in shares of Common
Stock or other shares of capital stock ranking junior to the Series A Preferred Stock as to
dividends and upon liquidation) shall be declared or paid or set aside for payment nor shall any
other distribution be declared or made upon the Common Stock, or any other capital stock of the
Company ranking junior to or on a parity with the Series A Preferred Stock as to dividends or upon
liquidation, nor shall any shares of Common Stock, or any other shares of capital stock of the
Company ranking junior to or on a parity with the Series A Preferred Stock as to dividends or upon
liquidation be redeemed, purchased or otherwise acquired for any consideration (or any monies be
paid to or made available for a sinking fund for the redemption of any such shares) by the Company
(except by conversion into or exchange for other capital stock of the Company ranking junior to the
Series A Preferred Stock as to dividends and upon liquidation or redemption for the purpose of
preserving the Companys qualification as a real estate investment trust (
REIT
)). Holders of
shares of the Series A Preferred Stock shall not be entitled to any dividend, whether payable in
cash, property or stock, in excess of full cumulative dividends on the Series A Preferred Stock as
provided above. Any dividend payment made on shares of the Series A Preferred Stock shall first be
credited against the earliest accumulated but unpaid dividend due with respect to such shares which
remains payable.
(e) If, for any taxable year, the Company elects to designate as a capital gain dividend (as
defined in Section 857 of the Internal Revenue Code of 1986, as amended (the
Code
) any portion
(the
Capital Gains Amount
) of the dividends paid or made available for the year to holders of any
class or series of stock of the Company, the portion of the Capital Gains Amount that shall be
allocable to holders of the Series A Preferred Stock shall be the amount that the total dividends
(as determined for federal income tax purposes) paid or made available to the holders of the Series
A Preferred Stock for the year bears to the aggregate amount of dividends (as determined for
federal income tax purposes) paid or made available to the holders of all classes or series of
stock of the Company for such year.
4.
Liquidation Preference
.
Upon any voluntary or involuntary liquidation, dissolution
or winding up of the affairs of the Company, the holders of shares of Series A Preferred Stock are
entitled to be paid out of the assets of the Company legally available for distribution to its
stockholders a liquidation preference of $25.00 per share, plus an amount equal to any accumulated,
accrued and unpaid dividends to and including the date of payment, but without interest, before any
distribution of assets is made to holders of Common Stock or any other class or series of capital
stock of the Company that ranks junior to the Series A Preferred Stock as to liquidation rights.
If the assets of the Company legally available for distribution to stockholders are insufficient to
pay in full the Liquidation Preference on the Series A Preferred Stock and the Liquidation
Preference on any shares of Parity Preferred Stock, all assets distributed to the holders of the
Series A Preferred Stock and any other series of Parity Preferred Stock shall be distributed pro
rata so that the amount of assets distributed per share of Series A Preferred Stock and such other
series of Parity Preferred Stock shall in all cases bear to each other the same ratio that the
Liquidation Preference per share on the Series A Preferred Stock and such other series of Parity
Preferred Stock bear to each other. Written notice of any such liquidation, dissolution or winding
up of the Company, stating the payment date or dates when, and the place or places where, the
amounts
distributable in such circumstances shall be payable, shall be given by first class mail,
postage pre-paid, not less than 30 nor more than 60 days prior to the payment date stated therein,
to each record holder of the Series A Preferred Shares at the respective addresses of such holders
as the same shall appear on the stock transfer records of the Company. After payment of the full
amount of the Liquidation Preference, plus any accumulated and unpaid dividends to which they are
entitled, the holders of Series A Preferred Stock will have no right or claim to any of the
remaining assets of the Company. The consolidation or merger of the Company with or into
another entity, a merger of another entity with or into the Company, a statutory share exchange by
the Company or a sale, lease, transfer or conveyance of all or substantially all of the Companys
property or business shall not be deemed to constitute a liquidation, dissolution or winding up of
the Company. In determining whether a distribution (other than upon voluntary or involuntary
liquidation, dissolution or winding up of the Company) by dividend, redemption or other acquisition
of shares of stock of the Company or otherwise is permitted under the MGCL, no effect shall be
given to amounts that would be needed, if the Company were to be dissolved at the time of the
distribution, to satisfy the preferential rights upon dissolution of holders of the Series A
Preferred Shares whose preferential rights upon dissolution are superior to those receiving the
distribution.
5.
Optional Redemption.
(a) The Series A Preferred Stock is not redeemable prior to January 30, 2011. However, in
order to ensure that the Company will continue to meet the requirement for qualification as a REIT,
the Series A Preferred Stock will be subject to provisions in the Companys Charter pursuant to
which shares of capital stock of the Company owned by a stockholder in excess of 9.8% in value of
the outstanding shares of capital stock of the Company (the
Ownership Limit
) will be deemed
Excess Shares, and the Company will have the right to purchase such Excess Shares from the
holder. On and after January 30, 2011, the Company, at its sole option upon not less than 30 nor
more than 60 days written notice, may redeem shares of the Series A Preferred Stock, in whole or
in part, at any time or from time to time, for cash at a redemption price of $25.00 per share, plus
all accumulated and unpaid dividends thereon to the date fixed for redemption (except with respect
to Excess Shares), without interest. Holders of Series A Preferred Stock to be redeemed shall
surrender such Series A Preferred Stock at the place designated in such notice and upon such
surrender shall be entitled to the redemption price and any accumulated and unpaid dividends
payable upon such redemption. If notice of redemption of any shares of Series A Preferred Stock
has been given and if the funds necessary for such redemption have been set aside by the Company in
trust for the benefit of the holders of any shares of Series A Preferred Stock to be redeemed, then
from and after the redemption date dividends will cease to accumulate on those shares of Series A
Preferred Stock, those shares of Series A Preferred Stock shall no longer be deemed outstanding and
all rights of the holders of such shares will terminate, except the right to receive the redemption
price. If less than all of the outstanding Series A Preferred Stock is to be redeemed, Series A
Preferred Shares shall be selected pro rata for redemption (as nearly as may be practicable without
creating fractional shares) or by any other equitable method determined by the Company. After
redemption, all shares of Series A Preferred Stock previously outstanding shall be unclassified and
shall constitute authorized and unissued shares of the Companys preferred stock that may be
designated by the Companys Board of Directors pursuant to Article VII of the Companys Charter, as
further amended.
(b) Unless full cumulative dividends on all shares of Series A Preferred Stock shall have been
or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof
set apart for payment for all past dividend periods and the then current dividend period, no shares
of Series A Preferred Stock shall be redeemed unless all outstanding shares of Series A Preferred
Stock are simultaneously redeemed and the Company shall not purchase or otherwise acquire directly
or indirectly any shares of Series A Preferred Stock (except by exchange for capital stock of the
Company ranking junior to the Series A Preferred Stock as to dividends and upon liquidation);
provided, however, that the foregoing shall not prevent the purchase by the Company of Excess
Shares in order to ensure that the Company continues to meet the requirements for qualification as
a REIT, or the purchase or acquisition of shares of Series A Preferred Stock
pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding shares of Series A Preferred
Stock. So long as no dividends are in arrears, the Company shall be entitled at any time and from
time to time to repurchase shares of Series A Preferred Stock in open-market transactions duly
authorized by the Board of Directors and effected in compliance with applicable laws.
(c) Notice of redemption will be given by publication in a newspaper of general circulation in
the City of New York, such publication to be made once a week for two successive weeks commencing
not less than 30 nor more than 60 days prior to the redemption date. A similar notice will be
mailed by the Company, postage prepaid, not less than 30 nor more than 60 days prior to the redemption date,
addressed to the respective holders of record of the Series A Preferred Stock to be redeemed at
their respective addresses as they appear on the stock transfer records of the Company. No failure
to give such notice or any defect therein or in the mailing thereof shall affect the validity of
the proceedings for the redemption of any shares of Series A Preferred Stock except as to the
holder to whom notice was defective or not given. Each notice shall state: (i) the redemption
date; (ii) the redemption price, (iii) the number of shares of Series A Preferred Stock to be
redeemed; (iv) the place or places where the Series A Preferred Stock is to be surrendered for
payment of the redemption price; and (v) that dividends on the shares to be redeemed will cease to
accrue on such redemption date. If less than all of the Series A Preferred Stock held by any
holder is to be redeemed, the notice mailed to such holder shall also specify the number of shares
of Series A Preferred Stock held by such holder to be redeemed.
(d) Immediately prior to any redemption of Series A Preferred Stock, the Company shall pay, in
cash, any accumulated and unpaid dividends through the redemption date, unless a redemption date
falls after a Dividend Record Date and prior to the corresponding Dividend Payment Date, in which
case each holder of Series A Preferred Stock at the close of business on such Dividend Record Date
shall be entitled to the dividend payable on such shares on the corresponding Dividend Payment Date
notwithstanding the redemption of such shares before such Dividend Payment Date.
(e) The Series A Preferred Stock has no stated maturity and will not be subject to any sinking
fund or mandatory redemption. However, in order to ensure that the Company continues to meet the
requirements for qualification as a REIT, Series A Preferred Stock acquired by a stockholder in
excess of the Ownership Limit will automatically become Excess Shares, and the Company will have
the right to purchase such Excess Shares from the holder. In addition, Excess Shares may be
redeemed, in whole or in part, at any time when outstanding shares of Series A Preferred Stock are
being redeemed, for cash at a redemption price of $25.00 per share, but excluding accumulated and
unpaid dividends on such Excess Shares, without interest. Such Excess Shares shall be redeemed in
such proportion and in accordance with such procedures as shares of Series A Preferred Stock are
being redeemed.
6.
Voting Rights.
(a) Holders of the Series A Preferred Stock will not have any voting rights, except as set
forth below or as otherwise from time to time required by law.
(b) Whenever dividends on any shares of Series A Preferred Stock shall be in arrears for
eighteen or more consecutive months (a
Preferred Dividend Default
), the holders of such shares of
Series A Preferred Stock voting separately as a class together with all other series of Parity
Preferred Stock upon which like voting rights have been conferred and are exercisable will be
entitled to vote separately as a class for the election of a total of two additional directors of
the Company (the
Preferred Stock Directors
) at a special meeting called by the holders of record
of at least 20% of the Series A Preferred Stock or the holders of record of at least 20% of any
series of Parity Preferred so in arrears (unless such request is received less than 90 days before
the date fixed for the next annual or special meeting of the stockholders) or at the next annual
meeting of
stockholders, and at each subsequent annual meeting until all dividends accumulated on
such shares of Series A Preferred Stock for the past dividend periods and the dividend for the then
current dividend period shall have been fully paid or declared and a sum sufficient for the payment
thereof set aside for payment. A quorum for any such meeting shall exist if at least a majority of
the outstanding shares of Series A Preferred Stock and shares of Parity Preferred Stock upon which
like voting rights have been conferred and are exercisable are represented in person or by proxy at
such meeting. The Preferred Stock Directors shall be elected upon the affirmative vote of a
plurality of the shares of Series A Preferred Stock and such Parity Preferred Stock present and
voting in person or by proxy at a duly called and held meeting at which a quorum is present voting
separately as a class. If and when all accumulated dividends and the dividend for the then current
dividend period on the Series A Preferred Stock shall have been paid in full or declared and set
aside for payment in full, the holders thereof shall be divested of the foregoing voting rights
(subject to revesting in the event of each and every Preferred Dividend Default)
and, if all accumulated dividends and the dividend for the then current dividend period have
been paid in full or declared and set aside for payment in full on all series
of Parity Preferred Stock upon which like voting rights have been
conferred and are exercisable, the term of office of each Preferred Stock Director so elected shall
terminate. Any Preferred Stock Director may be removed at any time with or without cause by, and
shall not be removed otherwise than by the vote of, the holders of record of a majority of the
outstanding shares of the Series A Preferred Stock when they have the voting rights described above
(voting separately as a class with all series of Parity Preferred Stock upon which like voting
rights have been conferred and are exercisable). So long as a Preferred Dividend Default shall
continue, any vacancy in the office of a Preferred Stock Director may be filled by written consent
of the Preferred Stock Director remaining in office, or if none remains in office, by a vote of the
holders of record of a majority of the outstanding shares of Series A Preferred Stock when they
have the voting rights described above (voting separately as a class with all series of Parity
Preferred Stock upon which like voting rights have been conferred and are exercisable). The
Preferred Stock Directors shall be entitled to one vote per director on any matter.
(c) So long as any shares of Series A Preferred Stock remain outstanding, the Company will
not, without the affirmative vote or consent of the holders of at least two-thirds of the shares of
the Series A Preferred Stock outstanding at the time, given in person or by proxy, either in
writing or at a meeting (voting separately as a class), amend, alter or repeal the provisions of
the Charter (including these Articles Supplementary), whether by merger, consolidation or otherwise
(each an
Event
), so as to materially and adversely affect any right, preference, privilege or
voting power of the Series A Preferred Stock or the holders thereof; provided, however, that with
respect to the occurrence of any Event set forth above, so long as the Series A Preferred Stock (or
shares issued by a surviving entity in substitution for the Series A Preferred Stock) remains
outstanding with the terms thereof materially unchanged, taking into account that upon the
occurrence of such an Event, the Company may not be the surviving entity, the occurrence of any
such Event shall not be deemed to materially and adversely affect such rights, preferences,
privileges or voting power of holders of the Series A Preferred Stock and provided, further that
(i) any increase in the amount of authorized shares of Series A Preferred Stock, (ii) any increase
in the amount of the authorized Preferred Stock or the creation or issuance of any other series of
Preferred Stock, or (iii) any increase in the amount of authorized shares of such series, in each
case ranking on a parity with or junior to the Series A Preferred Stock with respect to payment of
dividends or the distribution of assets upon liquidation, dissolution or winding up, shall not be
deemed to materially and adversely affect such rights, preferences, privileges or voting powers.
(d) The foregoing voting provisions will not apply if, at or prior to the time when the act
with respect to which such vote would otherwise be required shall be effected, all outstanding
shares of Series A Preferred Stock shall have been redeemed or called for redemption upon proper
notice and sufficient funds shall have been deposited in trust to effect such redemption.
7.
Conversion
. The Series A Preferred Stock is not convertible into or exchangeable
for any other property or securities of the Company.
8.
Maturity
. The Series A Preferred Stock has no stated maturity and will not be
subject to any sinking fund or mandatory redemption.
9.
No Preemptive Rights
. No holder of the Series A Preferred Stock of the Company
shall, as such holder, have any preemptive rights to purchase or subscribe for additional shares of
stock of the Company or any other security of the Company which it may issue or sell.
FOURTH
: The Series A Preferred Shares have been classified and designated by the Board under
the authority contained in the Charter.
FIFTH
: These Articles Supplementary have been approved by the Board in the manner and by the
vote required by law.
SIXTH
: These Articles Supplementary shall be effective at the time the Department accepts
these Articles Supplementary for record.
SEVENTH
: The undersigned President of the Company acknowledges these Articles Supplementary to
be the act of the Company and, as to all matters or facts required to be verified under oath, the
undersigned Chief Executive Officer acknowledges that to the best of his knowledge, information and
belief, these matters and facts are true in all material respects and that this statement is made
under the penalties for perjury.
IN WITNESS WHEREOF
, the Company has caused these Articles Supplementary to be executed under
seal in its name and on its behalf by its President and attested to by its Assistant Secretary on
this 18th day of January, 2006.
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GLADSTONE COMMERCIAL CORPORATION
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/s/ Terry Brubaker
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By:
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Terry Brubaker
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Title:
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President
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[SEAL]
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ATTEST:
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/s/ George Stelljes III
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Name:
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George Stelljes III
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Title:
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Assistant Secretary
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