Public Storage 2001 Annual Report Download - page 35

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P
UBLIC S TORAGE ,I NC . 2001 A NNUAL R EPORT
On January 18, 2002, we completed a public offering of 6,000,000 depositary shares ($25 stated value per depositary share)
each representing 1/1,000 of a share of 7.625% Cumulative Preferred Stock, Series T (“Series T Preferred Stock”). The Series T
Preferred Stock has general preference rights over the Common Stock with respect to distributions and liquidation proceeds.
Except in certain conditions relating to the Company’s qualification as a REIT, the Series T preferred stock is not redeemable prior
to January 18, 2007. After January 18, 2007, the Series T preferred stock will be redeemable at the option of the Company, in
whole or in part, at $25 per depository share, plus accrued and unpaid dividends.
On February 19, 2002, we completed a public offering of 6,000,000 depositary shares ($25 stated value per depositary share)
each representing 1/1,000 of a share of 7.625% Cumulative Preferred Stock, Series U (“Series U Preferred Stock”). The Series U
Preferred Stock has general preference rights over the Common Stock with respect to distributions and liquidation proceeds.
Except in certain conditions relating to the Company’s qualification as a REIT, the Series U preferred stock is not redeemable
prior to February 19, 2007. After February 19, 2007, the Series U preferred stock will be redeemable at the option of the
Company, in whole or in part, at $25 per depository share, plus accrued and unpaid dividends.
On April 19, 2002 we expect to acquire all of the 55,150 limited partnership units that we did not own in PS Partners V, Ltd., a
partnership which is consolidated with the Company. The acquisition of the 55,150 units will be accomplished through a merger
of a subsidiary of the Company into the partnership and the conversion of the 55,150 units into either cash or common stock of
the Company. Each unit will be converted into the right to receive a value of $596 in our common stock, or cash at the election
of the unitholder.
Note 14 — Recent Accounting Pronouncements and Guidance
Accounting for Business Combinations
In June 2001, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standard No. 141,
“Business Combinations,” (“SFAS 141”) which sets forth revised accounting guidance with respect to accounting for acquisitions
of business enterprises. In accordance with the transition provisions of SFAS 141, the Company adopted the disclosure and
accounting provisions of SFAS 141 for the business combinations it completed after June 30, 2001.
Accounting for Goodwill and Other Intangible Assets
In June 2001, the FASB issued Statement of Financial Accounting Standard No. 142, “Goodwill and Other Intangible Assets,”
(“SFAS 142”) which addresses how intangible assets that are acquired individually or with a group of other assets (but not those
acquired in a business combination, which are addressed in SFAS 141) are to be accounted for. It also addresses how goodwill and
other intangible assets should be accounted for after they have been initially recognized in the financial statements. In accordance
with SFAS 142, the Company will adopt the provisions of SFAS No. 142 in its financial statements beginning with the year ending
December 31, 2002. The impact will include a reduction in amortization expense relative to goodwill and other intangible assets
outstanding at December 31, 2001 of approximately $2,709,000 per year, pursuant to SFAS No. 142’s provision that precludes
amortization of intangibles with indeterminate lives. The Company will continue to annually review the recoverability of its
intangible assets and goodwill by comparing the estimated value of such assets to their carrying value, in accordance with SFAS 142.
Accounting for the Impairment and Disposal of Long-Lived Assets
In August 2001, the FASB issued Statement of Financial Accounting Standards No. 144 (“SFAS 144”) which addresses financial
accounting and reporting for the impairment or disposal of long-lived assets and supersedes SFAS 121, and the accounting and
reporting provisions of APB Opinion No. 30, “Reporting the Results of Operations” for a disposal of a segment of a business. SFAS
144 is effective for fiscal years beginning after December 15, 2001, with earlier application encouraged. The Company expects to
adopt SFAS 144 on January 1, 2002, and does not expect that the adoption of the Statement will have a material impact upon the
Company’s financial position or results of operations.