Exhibit 1.01
FEDERAL REALTY INVESTMENT TRUST
Common Shares and Preferred Shares
Underwriting Agreement
May 9, 2003
WACHOVIA SECURITIES, INC.
as Representative of the several Underwriters
▇ ▇▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
From time to time Federal Realty Investment Trust, a Maryland real estate
investment trust (the "Company"), proposes to enter into one or more Pricing
Agreements (each a "Pricing Agreement") in substantially the form of Annex I
hereto, with such additions and deletions as the parties thereto may determine,
and, subject to the terms and conditions stated herein and therein, to issue and
sell to the firms named in Schedule I to the applicable Pricing Agreement (such
firms constituting the "Underwriters" with respect to such Pricing Agreement and
the securities specified therein) certain of its shares of beneficial interest
(the "Shares") specified in Schedule II to such Pricing Agreement (with respect
to such Pricing Agreement, the "Designated Shares"). If specified in such
Pricing Agreement, the Designated Shares may consist of a specified number of
shares that the Underwriters, acting severally and not jointly, have agreed to
purchase (the "Initial Shares") and a specified number of shares that the
Underwriters, acting severally and not jointly, have the option to purchase to
cover over allotments, if any (the "Option Shares"), in each case on the terms
and subject to the conditions set forth in this Agreement and such Pricing
Agreement. The Shares may include the Company's common shares of beneficial
interest, par value $0.01 per share (the "Common Shares"), or preferred shares
of beneficial interest, par value $0.01 per share (the "Preferred Shares").
The terms and rights of any particular issuance of Designated Shares shall
be as specified in the Pricing Agreement relating thereto and in or pursuant to
the resolutions of the board of trustees of the Company or a duly appointed
committee thereof.
1. Particular sales of Designated Shares may be made from time to time to
the Underwriters of such Shares, for whom the firms designated as
representatives of the Underwriters of such Shares in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to Underwriters who act without any firm being
designated as their representative. This Underwriting Agreement shall not be
construed as an obligation of the Company to sell any of the Shares or as an
obligation of any of the Underwriters to purchase any of the Shares. The
obligation of the Company to issue and sell any of the Shares and the obligation
of any of the Underwriters to purchase any of the Shares shall be evidenced by
the Pricing Agreement with respect to the Designated Shares specified therein.
Each Pricing Agreement shall specify the aggregate number of such Designated
Shares (and, if applicable, the aggregate number of Initial Shares and Option
Shares), the initial public offering price of such Designated Shares, the
purchase price to the Underwriters of such Designated Shares, the names of the
Underwriters of such Designated Shares, the names of the Representatives of such
Underwriters and the number of such Designated Shares to be purchased by each
Underwriter and shall set forth the date and time of delivery of such Designated
Shares and payment therefor. The Pricing Agreement shall also specify (to the
extent not set forth in the registration statement and prospectus with respect
thereto) the terms of such Designated Shares. A Pricing Agreement shall be in
the form of an executed writing (which may be in counterparts), and may be
evidenced by an exchange of telecopied communications or any other rapid
transmission device designed to produce a written record of communications
transmitted. The obligations of the Underwriters under this Agreement and each
Pricing Agreement shall be several and not joint.
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-100819) in
respect of the Shares has been filed with the Securities and Exchange
Commission (the "Commission"); the Registration Statement (as defined
below) and any post-effective amendments thereto, each in the form
heretofore delivered or made available to the Representatives, excluding
exhibits to such Registration Statement, but including all documents
incorporated by reference in the prospectus contained therein, have been
declared effective by the Commission in such form; other than a
registration statement, if any, increasing the size of the offering (a
"Rule 462(b) Registration Statement") filed pursuant to Rule 462(b) under
the Securities Act of 1933, as amended (the "Act"), which became or will
become effective upon filing, no other documents with respect to the
Registration Statement have heretofore been filed or transmitted for filing
with the Commission (other than prospectuses filed pursuant to Rule 424(b)
under the Act, each in the form heretofore delivered to the
Representatives); and no stop order suspending the effectiveness of the
Registration Statement, any post-effective amendments thereto or the Rule
462(b) Registration Statement, if any, has been issued and no proceeding
for that purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in the Registration Statement or filed with
the Commission pursuant to Rule 424 under the Act is hereinafter called a
"Preliminary Prospectus"); the various parts of the Registration Statement
and the Rule 462(b) Registration Statement, if any, including all exhibits
thereto and the documents incorporated by reference in the prospectus
contained in the Registration Statement at the time such part of the
registration statement became effective, each as amended at the time such
part of the Registration Statement became effective or such part of the
Rule 462(b) Registration Statement, if any, became or hereafter becomes
effective, are hereinafter collectively called the "Registration
Statement"; the prospectus relating to the Shares, in the form in which it
has most
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recently been filed, or transmitted for filing, with the Commission on or
prior to the date of this Agreement, is hereinafter called the
"Prospectus"; any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the
Act as of the date of such Preliminary Prospectus or Prospectus, as the
case may be; any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include any documents filed after the date of such Preliminary Prospectus
or Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated by reference in
such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment to the Registration Statement shall be deemed to
refer to and include any filing of the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act after the effective date of the
Registration Statement that is incorporated by reference in the
Registration Statement; any reference to the Prospectus as amended or
supplemented shall be deemed to refer to the Prospectus as amended or
supplemented in relation to the applicable Designated Shares in the form in
which it is filed with the Commission pursuant to Rule 424(b) under the Act
in accordance with Section 5(a) hereof, including any documents
incorporated by reference therein as of the date of such filing; all
references herein to information which is "contained" or "included" in the
Registration Statement, any Preliminary Prospectus, any Prospectus, any
Prospectus as amended or supplemented or any Rule 434 Prospectus (and all
references of like import) shall be deemed to mean and include all such
information which is incorporated or deemed to be incorporated by reference
therein; and if the Company elects to rely on Rule 434 under the Act, any
reference to the Prospectus shall be deemed to include, without limitation,
the form of prospectus and the abbreviated term sheet, taken together,
provided to the Underwriters by the Company in reliance on Rule 434 under
the Act (the "Rule 434 Prospectus"));
(b) The documents incorporated by reference in the Prospectus, when they
became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances under which they were made; and
any further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such
documents become effective or are filed with the Commission, as the case
may be, will conform in all material respects to the requirements of the
Act or the Exchange Act, as applicable, and the rules and regulations of
the Commission thereunder and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not apply to
any statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter of
Designated Shares through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Shares;
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(c) The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of
the Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the respective rules and regulations of the Commission
thereunder; and the Registration Statement and the Prospectus do not and
will not, as of the applicable effective date as to the Registration
Statement and any amendment thereto, as of the date of filing with the
Commission of any Annual Report of the Company on Form 10-K in the case of
the Registration Statement, and as of the applicable filing date as to the
Prospectus and any amendment or supplement thereto, contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading in light of the circumstances under which they were made;
provided, however, that this representation and warranty shall not apply to
any statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter of
Designated Shares through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Shares;
(d) The Company has been duly organized and is validly existing and in
good standing as a real estate investment trust under the laws of the State
of Maryland, with full power and authority to own, lease and operate its
properties and conduct its business as described in the Prospectus; the
Company has interests in a number of entities (collectively, the
"Entities"), identified on Annex III, which have been duly organized and
are validly existing as corporations, partnerships, limited liability
corporations or joint ventures, as the case may be, in good standing under
the laws of the jurisdiction of their organization (except for joint
ventures, which have no good standing certificate requirements), with full
power and authority to own, lease and operate their properties and conduct
their business as described in the Prospectus; except as otherwise denoted
in Annex III hereto, all of the equity interests in the Entities are owned
by the Company, free and clear of all pledges, liens, encumbrances, claims,
security interests and defects; all of the issued and outstanding stock of
each Entity that is a corporation has been duly authorized and validly
issued and is fully paid and non-assessable; no options, warrants or other
rights to convert any obligations into partnership or other ownership
interests in the Entities are outstanding; and the Company and the Entities
are duly qualified to transact business in all jurisdictions in which the
Company and the Entities are transacting business and in which the conduct
of their respective businesses requires such qualification, except where
the failure to so qualify would not have a material adverse effect on the
condition, financial or otherwise, or on the earnings, business affairs or
business prospects of the Company and the Entities considered as one
enterprise;
(e) Neither the Company nor any of the Entities has sustained since the
date of the latest audited financial statements included or incorporated by
reference in the Prospectus any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in the
Prospectus; and, since the date as of which information is given in the
Prospectus, there has not been any change in the authorized, issued or
outstanding capital shares of the Company (except for subsequent issuances,
if any, of Common Shares pursuant to
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(x) the Company's Dividend Reinvestment and Share Purchase Plan as in
effect on the date of the applicable Pricing Agreement, (y) any of the
Company's employee or trustee benefits plans, including upon exercise of
share options granted pursuant thereto, as such plans are in effect on the
date of the applicable Pricing Agreement or (z) the exercise of contractual
rights existing on the date of the applicable Pricing Agreement by the
current and former holders of partnership or other interests in certain of
the "DownREIT" and other Entities listed in Annex III hereto which may
result in the issuance of Common Shares of the Company) or any increase in
the consolidated long-term debt of the Company or any material adverse
change, or any development involving a prospective material adverse change,
in or affecting the general affairs, management, financial position,
shareholders' equity or results of operations of the Company and the
Entities taken as a whole, otherwise than as set forth or contemplated in
the Prospectus;
(f) The Company has an authorized capitalization as set forth in the
Prospectus, all of the issued capital shares of the Company have been duly
and validly authorized and issued and are fully paid and non-assessable,
and none of the outstanding capital shares of the Company was issued in
violation of any preemptive or other similar rights of any securityholder
of the Company;
(g) The Designated Shares have been duly and validly authorized, and,
when Designated Shares are issued and delivered pursuant to this Agreement
and the Pricing Agreement with respect to such Designated Shares, such
Designated Shares will be duly and validly issued and fully paid and
non-assessable; the Designated Shares conform to the description thereof
contained in the Registration Statement and the Prospectus as amended or
supplemented with respect to such Designated Shares; except as set forth
under the caption "Description of Shares of Beneficial
Interest--Shareholder Liability" in the Prospectus, no holder of the
Designated Shares is or will be subject to personal liability by reason of
being such a holder; and the issuance of the Designated Shares is not
subject to any preemptive or other similar rights of any securityholder of
the Company;
(h) The issue and sale of the Designated Shares and the compliance by
the Company with all of the provisions of this Agreement and any Pricing
Agreement, and the consummation of the transactions herein and therein
contemplated, will not conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of the Entities is a party or by
which the Company or any of the Entities is bound or to which any of the
property or assets of the Company or any of the Entities is subject, nor
will such action result in any violation of the provisions of the
Declaration of Trust or Bylaws of the Company or any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of the Entities or any of their
properties; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Shares or the consummation by the
Company of the transactions contemplated by this Agreement or any Pricing
Agreement, except such as have been, or will have been prior to the Time of
Delivery (as defined in Section 4 hereof), obtained under the Act, the
Exchange Act and
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the rules of the New York Stock Exchange (the "NYSE") and such consents,
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Shares by the Underwriters;
(i) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of the
Entities is a party or of which any property of the Company or any of the
Entities is the subject which, if determined adversely to the Company or
any of the Entities, would individually or in the aggregate have a material
adverse effect on the consolidated financial position, shareholders' equity
or results of operations of the Company and the Entities; and, to the best
of the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(j) The consolidated financial statements of the Company and the
Entities, together with related notes and schedules as set forth or
incorporated by reference in the Registration Statement, present fairly the
financial position and the results of operations of the Company and the
Entities at the indicated dates and for the indicated periods. Such
consolidated financial statements have been prepared in accordance with
generally accepted accounting principles, consistently applied throughout
the periods involved, and all adjustments necessary for a fair presentation
of results for such periods have been made. The summary financial and
statistical data contained in the Prospectus present fairly the information
shown therein and have been compiled on a basis consistent with the
consolidated financial statements incorporated by reference therein;
(k) The Company and the Entities have good and marketable title to, or
valid and enforceable leasehold estates in, all items of real and personal
property referred to in the Prospectus as owned or leased by the Company or
any of the Entities, in each case free and clear of all pledges, liens,
encumbrances, claims, security interests and defects, other than those
referred to in the Prospectus or which are not material in amount;
(l) The Company and the Entities have filed all federal, state, local
and foreign income tax returns which have been required to be filed, or
appropriate extensions for such filings have been obtained as required by
law, and all federal, state, local and foreign taxes of the Company and the
Entities have been paid except such taxes as are not yet due or are being
contested in good faith;
(m) The Company and each of the Entities hold all material licenses,
certificates and permits from governmental authorities which are necessary
to the conduct of their respective businesses; and neither the Company nor
any of the Entities has infringed any patents, patent rights, trade names,
trademarks or copyrights, which infringement is material to the business of
the Company;
(n) ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, which audited the consolidated balance sheet of
the Company and subsidiaries as of December 31, 2002 and the related
consolidated statement of operations, common shareholders' equity, and cash
flows for the year ended December 31, 2002 incorporated by reference in the
Registration Statement and
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Prospectus, are independent public accountants as required by the Act and
the rules and regulations of the Commission promulgated thereunder;
(o) To our knowledge, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, which audited the
consolidated balance sheets of the Company and subsidiaries as of December
31, 2001 and the related consolidated statements of operations, common
shareholders' equity, and cash flows for each of the years in the two-year
period ended December 31, 2001 incorporated by reference in the
Registration Statement and Prospectus, was, at all times until its
replacement as the Company's auditor in June 2002, an independent public
accountant as required by the Act and the rules and regulations of the
Commission promulgated thereunder;
(p) The conditions for use of registration statements on Form S-3 set
forth in the General Instructions on Form S-3 have been satisfied and the
Company is entitled to use such form for the transaction contemplated
herein;
(q) Although the Company is aware of the presence of hazardous
substances, hazardous materials, toxic substances or waste materials
("Hazardous Materials") on certain of its properties, nothing has come to
the attention of the Company which, at this time, would lead the Company to
believe that the presence of such Hazardous Materials, when considered in
the aggregate, would materially adversely affect the financial condition of
the Company. In connection with the construction on or operation and use of
the properties owned or leased by the Company or the Entities, the Company
represents that, as of the date of this Agreement, it has no knowledge of
any material failure by the Company or the Entities to comply with all
applicable local, state and federal environmental laws, regulations,
ordinances and administrative and judicial orders relating to the
generation, recycling, reuse, sale, storage, handling, transport and
disposal of any Hazardous Materials; and
(r) With respect to all tax periods regarding which the Internal Revenue
Service is or will be entitled to assert any claim, the Company has met the
requirements for qualification as a real estate investment trust under
Sections 856 through 860 of the Internal Revenue Code of 1986, as amended
(the "Code"), and the Company's present and contemplated operations, assets
and income continue to meet such requirements; and the Company is neither
an "investment company" nor a company "controlled" by an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended.
3. Upon the execution of the Pricing Agreement applicable to any Designated
Shares and authorization by the Representatives of the release of such
Designated Shares, the several Underwriters propose to offer such Designated
Shares for sale upon the terms and conditions set forth in the Prospectus as
amended or supplemented.
4. Certificates for the Designated Shares to be purchased by each
Underwriter pursuant to the Pricing Agreement relating thereto, in definitive
form and in such authorized denominations and registered in such names as the
Representatives may request upon at least twenty-four hours' prior notice to the
Company, shall be delivered by or on behalf of the
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Company to the Representatives for the account of such Underwriter, against
payment by such Underwriter or on its behalf of the purchase price therefor by
wire transfer of federal or other immediately available funds to an account at a
bank located in one of the 48 contiguous states of the United States of America
(which account shall be designated by the Company upon at least forty-eight
hours' prior notice to the Representatives), all at the place and time and date
specified in or pursuant to such Pricing Agreement or at such other place and
time and date as the Representatives and the Company may agree upon in writing.
The time and date of delivery of and payment for the Initial Shares (or, if the
applicable Pricing Agreement does not grant the Underwriters an option to
purchase Option Shares, the Designated Shares) is herein called the "Time of
Delivery" for such Shares, and, if the applicable Pricing Agreement grants the
Underwriters an option to purchase Option Shares and if the Underwriters
exercise such option, in whole or in part, the time and date of delivery of such
Option Shares is hereinafter called the "Option Closing Time" for such Shares.
5. The Company agrees with each of the Underwriters of any Designated
Shares:
(a) If the Company does not elect to rely on Rule 434 under the Act,
immediately following execution and delivery of the applicable Pricing
Agreement, to prepare the Prospectus as amended and supplemented in
relation to the applicable Designated Shares in a form approved by the
Representatives and to file such Prospectus as amended or supplemented
pursuant to Rule 424(b) under the Act not later than the Commission's close
of business on the second business day following the execution and delivery
of the Pricing Agreement relating to the applicable Designated Shares or,
if applicable, such earlier time as may be required by Rule 424(b), or if
the Company elects to rely on Rule 434 under the Act, immediately following
execution and delivery of the applicable Pricing Agreement, to prepare an
abbreviated term sheet relating to the Designated Shares in a form approved
by the Representatives that complies with the requirements of Rule 434
under the Act and to file such form of Rule 434 Prospectus complying with
Rule 434(c)(2) of the Act pursuant to Rule 424(b) under the Act not later
than the Commission's close of business on the business day following the
execution and delivery of the Pricing Agreement relating to the applicable
Designated Shares or, if applicable, such earlier time as may be required
by Rule 424(b); to make no further amendment or any supplement to the
Registration Statement or Prospectus as amended or supplemented after the
date of the Pricing Agreement relating to such Designated Shares and prior
to the Time of Delivery for such Designated Shares (or, if the applicable
Pricing Agreement provides for an over-allotment option, prior to the
Option Closing Time or, if such over-allotment option is not exercised by
the Underwriters, prior to the expiration of such over-allotment option)
which shall be reasonably disapproved by the Representatives for such
Designated Shares promptly after reasonable notice thereof; to advise the
Representatives promptly of any such amendment or supplement after such
Time of Delivery (or, if the applicable Pricing Agreement provides for an
over-allotment option, after the Option Closing Time or, if such
over-allotment option is not exercised by the Underwriters, after the
expiration of such over-allotment option) and furnish the Representatives
with copies thereof; to file promptly all reports and any definitive proxy
or information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange
Act for so long as the delivery of a prospectus is required in connection
with the offering or sale of such
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Designated Shares, and during such same period to advise the
Representatives, promptly after it receives notice thereof, of the time
when any amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus has
been filed with the Commission, of the issuance by the Commission of any
stop order or of any order preventing or suspending the use of any
Prospectus as amended or supplemented, of the suspension of the
qualification of such Designated Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any
such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus as amended or
supplemented or for additional information; and, in the event of the
issuance of any such stop order or of any such order preventing or
suspending the use of any Prospectus as amended or supplemented relating to
the Designated Shares or suspending any such qualification, to use promptly
its best efforts to obtain its withdrawal;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Designated Shares
for offering and sale under the securities laws of such jurisdictions as
the Representatives may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of such
Designated Shares, provided that in connection therewith the Company shall
not be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(c) Promptly to furnish to the Underwriters in New York City with copies
of the Prospectus, as amended or supplemented, in such quantities as the
Representatives may reasonably request, and, if the delivery of a
prospectus is required at any time in connection with the offering or sale
of the Designated Shares and if at such time any event shall have occurred
as a result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when such Prospectus
as amended or supplemented is delivered, not misleading, or, if for any
other reason it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the Act
or the Exchange Act, to notify the Representatives and upon their request
to file such document and to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as the
Representatives may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c)),
an earnings statement of the Company (which need not be audited) complying
with Section 11(a) of the Act and the rules and regulations of the
Commission thereunder (including at the option of the Company Rule 158);
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(e) During the period beginning on and including the date of the
Pricing Agreement for such Designated Shares and continuing through and
including the 60/th/ day after the date of the Pricing Agreement, not to
offer, sell, contract to sell, pledge or otherwise issue or dispose of (or
enter into any transaction which is designed to, or might reasonably be
expected to, result in the disposition (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise) by the
Company), directly or indirectly, or establish or increase a put equivalent
position or liquidate or decrease a call equivalent position with the
meaning of Section 16 of the Exchange Act and the rules and regulations of
the Commission promulgated thereunder with respect to, (i) if such
Designated Shares are Common Shares, any Common Shares, any capital shares
of the Company which are substantially similar to Common Shares or any
securities convertible into or exercisable, exchangeable or redeemable for
Common Shares or any capital shares of the Company which are substantially
similar to Common Shares or (ii) if such Designated Shares are Preferred
Shares, any such Preferred Shares, any capital shares of the Company which
are substantially similar to such Preferred Shares or any securities
convertible into or exercisable, exchangeable or redeemable for any such
Preferred Shares or any capital shares of the Company which are
substantially similar to such Preferred Shares, in each case without the
prior written consent of the Representatives; provided, however, that the
foregoing restrictions shall not prohibit the sale of such Designated
Shares to the Underwriters pursuant to this Agreement and the applicable
Pricing Agreement, and shall not prohibit the Company from issuing (A)
Common Shares pursuant to (x) the Company's Dividend Reinvestment and Share
Purchase Plan as in effect on the date of the applicable Pricing Agreement,
(y) any of the Company's employee or trustee benefit plans, including upon
exercise of share options granted pursuant thereto, as such plans are in
effect on the date of the applicable Pricing Agreement or (z) the exercise
of contractual rights existing on the date of the applicable Pricing
Agreement by current and former holders of partnership or other interests
in certain of the "DownREIT" and other Entities listed in Annex III hereto
which may result in the issuance of Common Shares by the Company, and (B)
any securities (the "Acquisition Securities") convertible into or
exercisable, exchangeable or redeemable for Common Shares as consideration
for the acquisition of real property, provided, that the Acquisition
Securities are not convertible, exercisable, exchangeable or redeemable for
or into Common Shares prior to the day following the 60/th/ day after the
date of the Pricing Agreement, and provided, further, that the Company
shall not release, modify or waive the restriction set forth in this clause
(B) with respect to the Acquisition Securities without the prior written
consent of the Representatives.
(f) To use the net proceeds received by it from the sale of the
Designated Shares in the manner specified in the Prospectus under the
caption "Use of Proceeds"; and
(g) To qualify as a "real estate investment trust" under the Code, and
to use its best efforts to continue to meet the requirements to qualify as
a "real estate investment trust."
6. The Company covenants and agrees with the several Underwriters that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of
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the Company's counsel and accountants in connection with the registration of the
Shares under the Act and all other expenses in connection with the preparation,
printing and filing of the Registration Statement, any Preliminary Prospectus
and the Prospectus and amendments and supplements thereto (including each
abbreviated term sheet delivered by the Company pursuant to Rule 434 under the
Act) and the mailing and delivering of copies thereof to the Underwriters and
dealers; (ii) the cost of printing or producing any Agreement Among
Underwriters, this Agreement, any Pricing Agreement, any blue sky and legal
investment surveys and any other documents in connection with the offering,
purchase, sale and delivery of the Shares; (iii) all expenses in connection with
the qualification of the Shares for offering and sale under state securities
laws as provided in Section 5(b) hereof, including the fees and disbursements of
counsel for the Underwriters in connection with such qualification and in
connection with the blue sky and legal investment surveys; (iv) any filing fees
incident to any required review by the National Association of Securities
Dealers, Inc. of the terms of the sale of the Shares; (v) the cost of preparing
certificates for the Shares; (vi) the costs and charges of any transfer agent or
registrar or dividend disbursing agent; and (vii) all other costs and expenses
incident to the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, Section 8 and Section 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, transfer taxes on resale of any of the Shares by them, and any
advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Shares under the
Pricing Agreement relating to such Designated Shares shall be subject, in the
discretion of the Representatives, to the condition that all representations and
warranties and other statements of the Company in, or incorporated by reference
from this Agreement into, the Pricing Agreement relating to such Designated
Shares are, at and as of the Time of Delivery for such Designated Shares (and,
if applicable, at and as of the Option Closing Time for any such Designated
Shares) true and correct, to the condition that the Company shall have performed
all of its obligations hereunder theretofore to be performed, and to the
following additional conditions:
(a) The Prospectus as amended or supplemented in relation to the
applicable Designated Shares shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for
such filing by the rules and regulations under the Act and in accordance
with Section 5(a) hereof; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to the Representatives' reasonable
satisfaction;
(b) Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the Underwriters, shall
have furnished to the Representatives such opinion or opinions, dated the
Time of Delivery for such Designated Shares, with respect to the
organization of the Company, the validity of the Designated Shares being
delivered at such Time of Delivery, the Registration Statement, the
Prospectus as amended or supplemented and other related matters as the
Representatives may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters (in rendering such opinion, Sidley
▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP
11
may rely, as to all matters arising under or governed by the laws of the
State of Maryland, on the opinion of ▇▇▇▇ ▇▇▇▇▇▇▇ LLP);
(c) ▇▇▇▇ ▇▇▇▇▇▇▇ LLP, counsel for the Company, shall have furnished to
the Representatives their written opinion, dated the Time of Delivery for
such Designated Shares, in form and substance satisfactory to the
Representatives, to the effect set forth in Schedule A hereto;
(d) In addition to the above opinion, the Representatives shall have
received the opinion or opinions of ▇▇▇▇ ▇▇▇▇▇▇▇ LLP, Tax Counsel to the
Company, dated the Time of Delivery for such Designated Shares, in form and
substance satisfactory to the Representatives, to the effect that (1) the
Company qualified as a real estate investment trust ("REIT") under the Code
for its taxable years ending through and including December 31, 2002, (2)
the Company is organized in conformity with the requirements for
qualification as a REIT under the Code, and its current method of operation
will enable it to meet the requirements for qualification as a REIT for the
current taxable year and for future taxable years; and (3) the discussion
in (x) the Prospectus under the caption "Federal Income Tax Consequences,"
and (y) the Company's Current Report on Form 8-K filed with the Commission
on March 25, 2003 (hereafter, the "Company's Form 8-K") under the captions
"Risk Factors--Failure to qualify as a REIT for federal income tax purposes
would cause us to be taxed as a corporation, which would substantially
reduce funds available for payment of distributions," "Risk Factors--We may
be required to incur additional debt to qualify as a REIT" and "Risk
Factors--To maintain our status as a REIT, we limit the amount of shares
any one shareholder can own" which is incorporated by reference into the
Prospectus Supplement, to the extent that it discusses matters of law or
legal conclusions or purports to describe certain provisions of the federal
tax laws, is a correct summary of the matters discussed therein, and the
opinions of such counsel appearing in the Prospectus under the caption
"Federal Income Tax Consequences" are hereby confirmed;
(e) On the date of the Pricing Agreement for such Designated Shares
and at the Time of Delivery for such Designated Shares, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP,
the independent accountants of the Company, shall have furnished to the
Underwriters a "comfort letter" in form and substance satisfactory to the
Representatives;
(f) On the date of the Pricing Agreement for such Designated
Securities and at the Time of Delivery for such Designated Securities the
Chief Executive Officer or Chief Operating Officer and the Chief Financial
Officer shall have furnished to the Representatives a certificate
substantially in the form of Annex II hereto;
(g) (i) Neither the Company nor any of the Entities shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended or
supplemented any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus as amended or
supplemented, and (ii) since the respective dates as of which information
is given in the Prospectus as amended or
12
supplemented there shall not have been any change in the authorized, issued
or outstanding capital shares of the Company or increase in long-term debt
of the Company or any of the Entities or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, shareholders' equity or results of
operations of the Company and the Entities, otherwise than as set forth or
contemplated in the Prospectus as amended or supplemented, the effect of
which, in any such case described in clause (i) or (ii), is in the judgment
of the Representatives so material and adverse as to make it impracticable
or inadvisable to proceed with the public offering or the delivery of the
Designated Shares on the terms and in the manner contemplated in the
Prospectus as amended or supplemented;
(h) On or after the date of the Pricing Agreement relating to the
Designated Shares (i) no downgrading shall have occurred in the rating
accorded the Company's debt securities or preferred shares by any
"nationally recognized statistical rating organization," as that term is
defined by the Commission for purposes of Rule 436(g)(2) under the Act and
(ii) no such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of
any of the Company's debt securities or preferred shares;
(i) On or after the date of the Pricing Agreement relating to the
Designated Shares there shall not have occurred any of the following: (i) a
suspension or material limitation in trading in securities generally on the
NYSE; (ii) a suspension or material limitation in trading in the Company's
securities on the NYSE; (iii) a general moratorium on commercial banking
activities in New York declared by either federal or New York State
authorities or a material disruption in commercial banking or securities
settlement or clearance services in the United States; or (iv) the outbreak
or escalation of hostilities involving the United States or the declaration
by the United States of a national emergency or war or other calamity or
crisis, if the effect of any such event specified in this clause (iv) in
the judgment of the Representatives makes it impracticable or inadvisable
to proceed with the public offering or the delivery of the Designated
Shares on the terms and in the manner contemplated in the Prospectus as
amended or supplemented;
(j) The Company shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of Prospectuses as amended or
supplemented;
(k) The Company shall have furnished or caused to be furnished to the
Representatives at the Time of Delivery for the Designated Shares a
certificate or certificates of officers of the Company dated such Time of
Delivery and satisfactory to the Representatives as to the accuracy of the
representations and warranties of the Company herein at and as of the date
of such certificate, as to the performance by the Company of all of its
obligations hereunder to be performed at or prior to the date of such
certificate, as to the matters set forth in subsections (a) and (g) of this
Section and as to such other matters as the Representatives may reasonably
request;
13
(l) On or prior to the date of the Pricing Agreement, the
Representatives shall have received an agreement substantially in the form
of Annex IV hereto signed by each of the persons listed in Schedule III to
such Pricing Agreement;
(m) The Designated Shares shall have been approved for listing on the
NYSE, subject to official notice of issuance; and
(n) In the event that the Pricing Agreement with respect to the
Designated Shares grants the Underwriters an option to purchase Option
Shares from the Company and the Underwriters exercise such option to
purchase all or any of the Option Shares, the obligations of the
Underwriters to purchase such Option Shares at the Option Closing Time
shall be subject to the further conditions that the Representatives shall
have received legal opinions of Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP and ▇▇▇▇
▇▇▇▇▇▇▇ LLP, dated such Option Closing Time, relating to the Option Shares
to be purchased and otherwise to the same effect as the respective opinions
referred to in Sections 7(b), (c) and (d), a certificate from the Chief
Financial Officer of the Company, dated such Option Closing Time, to the
same effect as the certificate required to be delivered at the Time of
Delivery pursuant to Section 7(f), a certificate or certificates of
officers of the Company, dated such Option Closing Time, to the same effect
as the certificates required pursuant to Section 7(k), and a "comfort
letter," dated such Option Closing Time, from ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP in the
same form and substance as the letter furnished to the Underwriters at the
Time of Delivery except that the "specified date" in such letter shall be a
date not more than five days prior to such Option Closing Time, and that
all of the foregoing are satisfactory to the Representatives.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Shares, or any amendment
or supplement thereto (including the information deemed to be a part of the
Registration Statement pursuant to Rule 434 under the Act, if applicable), or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse each Underwriter for any
legal or other expenses reasonably incurred by such Underwriter in connection
with investigating or defending any such action or claim as such expenses are
incurred; provided, however, that the Company shall not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, any preliminary prospectus
supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Shares, or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter of Designated Shares
through the Representatives expressly for use in the Prospectus as amended or
supplemented relating to such Shares; and provided, further, that this indemnity
agreement with respect to any Preliminary Prospectus shall not inure to the
benefit of any Underwriter from whom the person asserting any such losses,
14
claims, damages or liabilities purchased Designated Shares, if a copy of the
Prospectus as amended or supplemented relating to the Designated Shares
(excluding documents incorporated or deemed to be incorporated by reference
therein) was not sent or given by or on behalf of such Underwriter to such
person, if such is required by the Act or the rules and regulations of the
Commission thereunder, at or prior to the written confirmation of the sale of
such Designated Shares to such person and if the Prospectus as amended or
supplemented relating to the Designated Shares would have corrected the defect
giving rise to such loss, claim, damage or liability, except that this proviso
shall not be applicable if such defect shall have been corrected in a document
which is incorporated or deemed to be incorporated by reference in the
Prospectus as amended or supplemented relating to the Designated Shares.
(b) Each Underwriter will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Shares, or any amendment or supplement thereto (including the
information deemed to be a part of the Registration Statement pursuant to Rule
434 under the Act, if applicable), or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Shares, or any such amendment or supplement in reliance upon and
in conformity with written information furnished to the Company by such
Underwriter through the Representatives expressly for use therein; and will
reimburse the Company for any legal or other expenses reasonably incurred by the
Company in connection with investigating or defending any such action or claim
as to which the Company shall be entitled to indemnification under this
subsection (b) as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel (unless separate counsel is required due to conflict of interest)
or any other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall,
15
without written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to, any
pending or threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified party is an
actual or potential party to such action or claim) unless such settlement,
compromises or judgment (i) includes an unconditional release of the indemnified
party from all liability arising out of such action or claim and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is unavailable to
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims damages or liabilities (or actions in
respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters of the Designated Shares on
the other from the offering of the Designated Shares to which such loss, claim,
damage or liability (or action in respect thereof) relates. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
under subsection (c) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company on the one hand and the Underwriters of the Designated
Shares on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and such Underwriters on the
other shall be deemed to be in the same proportion as the total net proceeds
from such offering (before deducting expenses) received by the Company bear to
the total underwriting discounts and commissions from such offering received by
such Underwriters. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company on the one hand or such Underwriters on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
the Underwriters agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro rata allocation (even if
the Underwriters were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (d), no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the applicable Designated Shares underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The obligations of the Underwriters
of
16
Designated Shares in this subsection (d) to contribute are several in proportion
to their respective underwriting obligations with respect to such Shares and not
joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer of the Company who signed the Registration
Statement, trustee of the Company and to each person, if any, who controls the
Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase the
Designated Shares which it has agreed to purchase at the Time of Delivery or, if
applicable, at the Option Closing Time under the Pricing Agreement relating to
such Designated Shares, the Representatives may in their discretion arrange for
themselves or another party or other parties to purchase such Designated Shares
on the terms contained herein. If within thirty-six hours after such default by
any Underwriter the Representatives do not arrange for the purchase of such
Designated Shares, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties
satisfactory to the Representatives to purchase such Designated Shares on such
terms. In the event that, within the respective prescribed period, the
Representatives notify the Company that they have so arranged for the purchase
of such Designated Shares, or the Company notifies the Representatives that it
has so arranged for the purchase of such Designated Shares, the Representatives
or the Company shall have the right to postpone the Time of Delivery or the
Option Closing Time, as the case may be, for such Designated Shares for a period
of not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus as amended or
supplemented, or in any other documents or arrangements, and the Company agrees
to file promptly any amendments or supplements to the Registration Statement or
the Prospectus which in the opinion of the Representatives may thereby be made
necessary. The term "Underwriter" as used in this Agreement shall include any
person substituted under this Section with like effect as if such person had
originally been a party to the Pricing Agreement with respect to such Designated
Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Designated Shares of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate number of such Designated Shares which remains unpurchased does not
exceed one-tenth of the aggregate number of Designated Shares to be purchased at
the Time of Delivery or the Option Closing Time, as the case may be, then the
Company shall have the right to require each non-defaulting Underwriter to
purchase the number of Designated Shares which such Underwriter agreed to
purchase at the Time of Delivery or such Option Closing Time, as the case may
be, under the Pricing Agreement relating to such Designated Shares and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Designated Shares which such Underwriter agreed to
purchase under such Pricing Agreement) of the Designated Shares of such
defaulting Underwriter or Underwriters for which such arrangements have not been
made; but nothing herein shall relieve a defaulting Underwriter from liability
for its default.
17
(c) If, after giving effect to any arrangements for the purchase of the
Designated Shares of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate number of Designated Shares which remains unpurchased exceeds
one-tenth of the aggregate number of the Designated Shares to be purchased at
the Time of Delivery or the Option Closing Time, as the case may be, as referred
to in subsection (b) above, or if the Company shall not exercise the right
described in subsection (b) above to require non-defaulting Underwriters to
purchase Designated Shares of a defaulting Underwriter or Underwriters, then, in
the case of a failure to purchase Designated Shares at the Time of Delivery, the
Pricing Agreement relating to such Designated Shares shall thereupon terminate,
without liability on the part of any non-defaulting Underwriter or the Company,
except for the expenses to be borne by the Company and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof or, in the case of a failure to purchase Designated Shares at
an Option Closing Time which is after the Time of Delivery, the several
obligations of the Underwriters to purchase and the obligation of the Company to
sell such Designated Shares at such Option Closing Time shall terminate without
liability on the part of any non-defaulting Underwriter or the Company, but in
any such case nothing herein shall relieve a defaulting Underwriter from
liability for its default.
10. The respective indemnities, agreements, representations, warranties and
other statements of the Company and the several Underwriters, as set forth in
this Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or trustee or controlling person of the Company, and shall
survive delivery of and payment for the Shares.
11. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, the Company shall not then be under any liability to any Underwriter
with respect to the Designated Shares covered by such Pricing Agreement except
as provided in Section 6 and Section 8 hereof. If this Agreement shall be
terminated as a result of any of the conditions set forth in Section 7 (other
than clause (i), (iii) or (iv) of Section 7(i) hereto) not being satisfied the
Company will reimburse the Underwriters through the Representatives for all
out-of-pocket expenses approved in writing by the Representatives, including
reasonable fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of such
Designated Shares, but the Company shall then be under no further liability to
any Underwriter with respect to such Designated Shares except as provided in
Section 6 and Section 8 hereof.
12. In all dealings hereunder, the Representatives of the Underwriters of
Designated Shares shall act on behalf of each of such Underwriters, and the
parties hereto shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail,
overnight courier, hand delivery or facsimile transmission to the address of the
Representatives as set forth in the applicable Pricing
18
Agreement; and if to the Company shall be delivered or sent by mail, overnight
courier, hand delivery or facsimile transmission to the address of the Company
set forth on the cover of the Registration Statement: Attention: Legal
Department; provided, however, that any notice to an Underwriter pursuant to
Section 8(c) hereof shall also be delivered or sent by mail, overnight courier,
hand delivery or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire, or telex or facsimile transmission
constituting such Questionnaire, which address will be supplied to the Company
by the Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, the Company and, to the extent
provided in Section 8 and Section 10 hereof, the officers of the Company who
signed the Registration Statement, trustees of the Company and each person who
controls the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement or any such Pricing
Agreement. No purchaser of any of the Shares from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used herein,
"business day" shall mean any day when the Commission's office in Washington,
D.C. is open for business.
15. This Agreement and each Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
16. This Agreement and each Pricing Agreement may be executed by any one or
more of the parties hereto and thereto in any number of counterparts, each of
which shall be deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
19
If the foregoing is in accordance with your understanding, please sign and
return this Agreement to us.
Very truly yours,
FEDERAL REALTY INVESTMENT TRUST
By: /s/ ▇▇▇▇▇ ▇. FINGER
---------------------
Name: ▇▇▇▇▇ ▇. Finger
Title: Senior Vice President,
Chief Financial Officer
and Treasurer
Accepted as of the date hereof:
WACHOVIA SECURITIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Director
20
ANNEX I
Pricing Agreement
., 2003
WACHOVIA SECURITIES, INC.
As representative of the several Underwriters named in Schedule I hereto
▇ ▇▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Federal Realty Investment Trust, a Maryland real estate investment
trust (the "Company"), proposes, subject to the terms and conditions stated
herein and in the Underwriting Agreement, dated May 9, 2003 (the "Underwriting
Agreement"), between the Company on the one hand and Wachovia Securities, Inc.,
on the other hand, to issue and sell to the Underwriters named in Schedule I
hereto (the "Underwriters") the Shares specified in Schedule II hereto (the
"Designated Shares"). Each of the provisions of the Underwriting Agreement is
incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Pricing Agreement to the same extent as if such provisions had been
set forth in full herein; and each of the representations and warranties set
forth therein shall be deemed to have been made at and as of the date of this
Pricing Agreement, except that each representation and warranty which refers to
the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be
a representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Shares which are the
subject of this Pricing Agreement. Each reference to the Representatives herein
and in the provisions of the Underwriting Agreement so incorporated by reference
shall be deemed to refer to you. Unless otherwise defined herein, terms defined
in the Underwriting Agreement are used herein as therein defined. The
Representative designated to act on behalf of the Representatives pursuant to
Section 12 of the Underwriting Agreement is Wachovia Securities, Inc., and the
Representatives designated to act on behalf of each of the Underwriters of the
Designated Shares pursuant to Section 12 of the Underwriting Agreement and the
address of the Representatives referred to in such Section 12 are set forth in
Schedule II hereto.
A supplement to the Prospectus relating to the Designated Shares, in
the form heretofore delivered to you, is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the Time of Delivery
and place and at the purchase price to the Underwriters set
I-1
forth in Schedule II hereto, the number of Initial Shares (as defined in
Schedule II hereto) set forth opposite the name of such Underwriter in Schedule
I hereto.
In addition, subject to the terms and conditions set forth herein and in
the Underwriting Agreement incorporated herein by reference, the Company hereby
grants an option to the Underwriters to purchase, severally and not jointly, up
to the number of Option Shares (as defined in Schedule II hereto) specified in
Schedule II hereto at the place and purchase price to the Underwriters set forth
in Schedule II hereto and at the Option Closing Time specified by the
Representatives as provided below. The option hereby granted will expire at
11:59 p.m. (New York City time) on the 30th day after the date of this Pricing
Agreement and may be exercised once, in whole or in part, for the purpose of
covering over-allotments which may be made in connection with the offering and
distribution of the Initial Shares upon notice by the Representatives to the
Company setting forth the number of Option Shares as to which the several
Underwriters are then exercising the option and the Option Closing Time for such
Option Shares. Any such Option Closing Time shall be determined by the
Representatives but shall not be later than seven full business days after the
exercise of such option nor in any event prior to the Time of Delivery. If the
option is exercised as to all or any portion of the Option Shares, each of the
Underwriters, acting severally and not jointly, will be obligated to purchase
that proportion of the total number of Option Shares then being purchased which
the number of Initial Shares set forth in Schedule II hereto opposite the name
of such Underwriter bears to the total number of Initial Shares (subject in each
case to such adjustments as the Representatives in their discretion shall make
to eliminate any sales or purchases of fractional shares), and the Company shall
be obligated to issue and sell such Option Shares to the several Underwriters,
in each case subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated by reference herein.
The obligations of the Underwriters under this Pricing Agreement and the
Underwriting Agreement incorporated herein are several and not joint.
This Pricing Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
I-2
If the foregoing is in accordance with your understanding, please sign and
return this Pricing Agreement to us, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this Pricing Agreement and such acceptance
hereof, including the provisions of the Underwriting Agreement incorporated
herein by reference, shall constitute a binding agreement between each of the
Underwriters and the Company.
Very truly yours,
FEDERAL REALTY INVESTMENT TRUST
By:__________________________________
Name:
Title:
Accepted as of the date hereof:
WACHOVIA SECURITIES, INC.,
On its own behalf and as Representative
of the several Underwriters
By:______________________________________
Name:
Title:
I-3
SCHEDULE I
Number of
Initial Shares
Underwriter to be Purchased
----------- ---------------
Wachovia Securities, Inc. .................... .,000
Total ................................... .,000
=======
SCHEDULE II
Title of Designated Shares:
Number of Designated Shares: ________ shares. The Designated Shares consist of an
aggregate of ______ Designated Shares (the "Initial
Shares") that the Underwriters have agreed, severally and
not jointly, to purchase and that the Company has agreed to
sell and an aggregate of up to ______ Designated Shares
(the "Option Shares") that the Underwriters have the option
to purchase, severally and not jointly, from the Company,
all subject to the terms and conditions set forth in this
Pricing Agreement and the Underwriting Agreement
incorporated by reference herein.
Initial Offering Price to Public Per Share for $______ per share.
Designated Shares
Purchase Price per Share for Designated Shares $______ per share; provided, however, that the purchase
to be Paid by the Underwriters price per share for any Option Shares purchased by the
Underwriters shall be reduced by an amount per share equal
to the aggregate amount per share of any dividends or
distributions declared, paid or payable with respect to the
Initial Shares but not payable with respect to such Option
Shares.
Specified funds for payment of purchase price: Wire transfer of immediately available funds.
Liquidation Preference Per Share for Designated
Shares, if applicable:
Dividend Payment Dates, if applicable:
Redemption provisions, if applicable:
Sinking fund requirements, if applicable:
Names and addresses of Representatives: Wachovia Securities, Inc.
▇ ▇▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Address for Notices, etc.: Wachovia Securities, Inc.
▇ ▇▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Other Terms:
Time of Delivery: 9:00 a.m. (New York City time) on _________
Closing Location: Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Place of Delivery of Designated New York, New York
Shares:
2
SCHEDULE III
List of Persons Subject to Lock-Up
▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇ ▇. Finger
1
SCHEDULE A
[Not filed with this Current Report]
1
ANNEX II
CERTIFICATE OF THE PRESIDENT AND CHIEF EXECUTIVE OFFICER
AND CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 7(f) OF THE UNDERWRITING AGREEMENT
I, ▇▇▇▇▇▇ ▇. ▇▇▇▇, the President and Chief Executive Officer and a Trustee,
and I, ▇▇▇▇▇ ▇. Finger, the Senior Vice President and Chief Financial Officer,
of Federal Realty Investment Trust, certify that:
(i) the Annual Report on Form 10-K for the year ended December 31,
2002 and the Quarterly Report on Form 10-Q for the fiscal quarter ended
March 31, 2003 (each individually a "Report" and collectively, the
"Reports"), and the Current Report on Form 8-K filed with the Securities
and Exchange Commission on March 25, 2003, fully comply with the
requirements of Section 13(a) or 15(d) of the Securities and Exchange Act
of 1934; and
(ii) the information contained in each Report fairly presents, in all
material respects, the financial condition and results of operations of
Federal Realty Investment Trust as of its date of filing with the
Securities and Exchange Commission.
May 9, 2003
__________________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇
President and Chief Executive Officer
and Trustee
__________________________________________________
▇▇▇▇▇ ▇. Finger
Senior Vice President, Chief Financial Officer and
Treasurer
II-1
ANNEX III
Company's Direct or
Indirect Ownership
FEDERAL REALTY INVESTMENT TRUST Interest
------------------------------- -------------------------
FR Associates Limited Partnership ("FR") 99%
Andorra Associates 99% (1% FR)
Governor Plaza Associates 99% (1% FR)
Shopping Center Associates 99% (1% FR)
▇▇▇▇▇▇ Enterprises II Limited Partnership 99% (1% FR)
FRIT Escondido Promenade, LLC 70%
FRIT Leasing & Development Services, Inc. 100% voting stock
Congressional Plaza Associates 55.7065%
FR Pike 7 Limited Partnership (DownREIT) 99%
Federal Realty Partners L.P. (Master DownREIT- 531,724 units outstanding - 429,904 40 units (FedRP Inc.)
units have been redeemed) 40 units (FRLP Inc.)
Federal Realty Partners, Inc. 100% voting stock
▇▇▇▇▇▇▇▇'▇ Plaza Limited Partnership (DownREIT - 250,000 units outstanding) 60,000 units (FedRP Inc.)
FRLP, Inc. 100% voting stock
FR Leesburg Plaza, LLC 100%
FR Leesburg Plaza, LP (DownREIT-352,500 total units issued - 7,816 units have 214,500 units (LLC)
been redeemed)
FRIT Property Services, Inc. (f/k/a Terranomics Retail Services, Inc. f/k/a TRS 100% nonvoting stock
Acquisition, Inc.)
Federal Realty Management Services, Inc. 100% voting stock
FR Federal Plaza, Inc. 100% voting stock
FR Federal Plaza, LLC 100% (FedPlaza Inc.)
Street Retail, Inc. 100% voting stock
STREET RETAIL, INC. ("SRI")
---------------------------
SRI Old Town, LLC ▇▇▇%
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ I, LLC ▇▇▇%
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ II, LLC 100%
Street Retail Tempe I, LLC 85%
Street Retail West GP, Inc. ("SRWGP") 100% voting stock
Street Retail West I, L.P. 90% (10% SRI)
Street Retail West II, L.P. 90% (10% SRI)
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇, ▇.▇. 90% (10% SRI)
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇, ▇.▇. 90%
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇, ▇.▇. 90%
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇, ▇.▇. 90%
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇, ▇.▇. 90%
III-1
Street Retail San Antonio, LP .1% (SRI San Anton)
99.9% (SRI Texas)
SRI San Antonio, Inc. (f/k/a Dim Sum, Inc. 100% voting stock
f/k/a FR Acquisition Holding Co., Inc.)
SRI Texas, Inc. 100% voting stock
JS&DB, Inc. 100% voting stock
SRI Holding Company, Inc. 100% nonvoting stock
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇, ▇.▇. 90% (SRI Holding)
FRIT San ▇▇▇▇ Town and Country Village, LLC 100%
San ▇▇▇▇ Residential, Inc. 100% nonvoting stock (LLC)
▇▇▇▇▇▇▇ Row Services, Inc. 100% voting
▇▇▇▇▇▇▇ Row ROF, Inc. 100% voting
La Rive Gauche San ▇▇▇▇, LLC 37.5%
Straits ▇▇▇▇▇▇▇ Row, LLC 90%
Blowfish SR, LLC 30%
Village Cafe ▇▇▇▇▇▇▇ Row, LLC 49.3%
Yankee Pier ▇▇▇▇▇▇▇ Row, LLC 75%
Pizza Antica, LLC 20%
▇▇▇▇▇▇▇ Row Association, a California non-profit mutual benefit corporation
III-2
ANNEX IV
[Form of Lock-Up Agreement]
Federal Realty Investment Trust
Public Offering of Common Shares
May 9, 2003
Wachovia Securities, Inc.
As Representative of the several Underwriters
▇ ▇▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
This letter is being delivered to you in connection with the proposed
Pricing Agreement dated as of May 9, 2003 (the "Agreement"), between Federal
Realty Investment Trust, a Maryland real estate investment trust (the
"Company"), and you, relating to an underwritten public offering of the
Company's common shares of beneficial interest, par value $0.01 (the "Common
Shares"). [Note: If the Designated Shares are Preferred Shares, change
references from "Common Shares" to "Preferred Shares," as appropriate.]
In order to induce you to enter into the Agreement, the undersigned will
not, without the prior written consent of Wachovia Securities, Inc., offer,
sell, contract to sell, pledge or otherwise dispose of (or enter into any
transaction that is designed to, or might reasonably be expected to, result in
the disposition of (whether by actual disposition or effective economic
disposition due to cash settlement or otherwise) by the undersigned), directly
or indirectly, or establish or increase a put equivalent position or liquidate
or decrease a call equivalent position within the meaning of Section 16 of the
Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Securities and Exchange Commission promulgated thereunder with respect to,
any capital shares of the Company or any securities convertible into or
exercisable, redeemable or exchangeable for such capital shares (in each case
whether now owned or hereinafter acquired by the Company), or publicly announce
an intention to effect any such transaction, for a period beginning on and
including the date of the Agreement through and including the date which is 60
days after the date of the Agreement; provided, however, that nothing contained
herein shall prohibit the exercise of stock options by the undersigned under the
Company's stock option plans for employees or trustees or other purchases by the
undersigned of capital shares of the Company or any securities convertible into
or exercisable, redeemable or exchangeable for such capital shares under the
Company's stock purchase plan for employees or
IV-1
trustees, in each case as such plans are in effect on the date of the Agreement
(provided that the undersigned understands and agrees that any and all capital
shares of the Company and securities convertible into or exercisable, redeemable
or exchangeable for such capital shares that the undersigned acquires on or
after the date of this agreement (including, without limitation, upon the
exercise of stock options or purchases under the Company's stock purchase plan
for employees or trustees) shall be subject to the terms and provisions of this
Agreement and, without limitation to the foregoing, the undersigned further
understands and agrees that the undersigned will not transfer, sell or otherwise
dispose of, directly or indirectly (including, without limitation, through a
broker or dealer), any capital shares of the Company or any securities
convertible into or exercisable, redeemable or exchangeable for such capital
shares in payment of all or any portion of the exercise price of any such stock
options exercised by the undersigned under any such stock option plans or in
payment of all or any portion of the purchase price of any such capital shares
or other securities purchased by the undersigned under any such stock purchase
plans or otherwise effect a so-called "cashless" exercise or purchase);
provided, further, however, that the undersigned may donate any capital shares
of the Company or any securities convertible into or exercisable, redeemable or
exchangeable for such capital shares to members of the undersigned's immediate
family, to a trust the beneficiaries of which are exclusively the undersigned or
members of the undersigned's immediate family or to charitable or educational
organizations without the prior written consent of Wachovia Securities, Inc. if,
in each case (i) such donation is a bona fide gift, (ii) the undersigned
provides written notice of such gift to Wachovia Securities, Inc. no later than
three business days prior to such gift, and (iii) the donee executes and
delivers to Wachovia Securities, Inc., prior to or contemporaneously with such
gift, a letter agreement, in form and substance reasonably satisfactory to
Wachovia Securities, Inc., in substantially the form of this letter agreement;
[The following clause to be included only in the lock-up agreement dated on or
about May 9, 2003 signed by ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇ - and provided, further, however,
that the undersigned may transfer any capital shares of the Company to any
person as part of a settlement of divorce entered into prior to the date of this
letter agreement, without notice to, or the consent of, Wachovia Securities,
Inc.] For purposes of this paragraph, "immediate family" shall mean a spouse,
lineal descendent, father, mother, brother or sister of the transferor.
If for any reason the Agreement shall be terminated prior to the Time of
Delivery (as defined in the Agreement), the agreement set forth above shall
likewise be terminated.
[Signature Page Immediately Follows]
IV-2
In witness whereof, the undersigned has executed and delivered this letter
agreement as of the day and year set forth above.
Yours very truly,
___________________________________
Print Name:
IV-3
