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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 19, 1998
BRE PROPERTIES, INC.
________________________________________________________________________
(Exact name of registrant as specified in charter)
Maryland 0-5305 94-1722214
___________________ _________________ _____________________
(State or other jurisdiction (Commission File (I.R.S. Employer
of incorporation) Number) Identification Number)
44 Montgomery Street
Suite 3600
San Francisco, California 94104-4602
____________________________ ______________________
(Address of principal executive offices) (Zip Code)
(415) 445-6530
________________________________________________________________________
(Registrant's telephone number, including area code)
One Montgomery Street, Telesis Tower, Suite 2500, San Francisco, California
94104-5525
____________________________________________________________________________
(Former name or former address, if changed since last report)
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Item 5. OTHER EVENTS
On February 19, 1998, BRE Properties, Inc. (the "Company") executed an
Underwriting Agreement (the "Underwriting Agreement") in connection with the
public offering of $130,000,000 aggregate principal amount of its 7 1/8% Notes
due 2013 ( the "Notes") under the Company's shelf registration statement on Form
S-3 (File No. 333-24915) effective May 7, 1997 (the "Registration Statement").
The Notes will be issued pursuant to an Indenture (the "Indenture") between the
Company and Chase Manhattan Bank and Trust Company, National Association, as
successor trustee.
This Current Report on Form 8-K shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any offer of the Notes in any
state in which such offer, solicitation or sale would be unlawful prior to the
registration or qualification under the securities laws of any such state.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits.
Exhibit No. Description
1.1 Underwriting Agreement, dated February 19, 1998, with respect to the
Notes, by and among the Company, Morgan Stanley & Co. Incorporated,
BancAmerica Robertson Stephens, Merrill Lynch, Pierce, Fenner & Smith
Incorporated and Salomon Brothers Inc
4.1 Indenture, dated June 23, 1997, between the Company and Chase
Manhattan Bank and Trust Company, National Association, as successor
trustee. (1)
4.2 Form of the Notes
____________________
(1) Incorporated by reference to Exhibit 4.1 to the Registrant's Current
Report on Form 8-K dated June 18, 1997.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
BRE PROPERTIES, INC.
Date: February 24, 1998 By: /s/ LeRoy E. Carlson
-------------------------
LeRoy E. Carlson
Executive Vice President,
Chief Financial Officer and Secretary
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EXHIBIT INDEX
Exhibit No. Description
1.1 Underwriting Agreement, dated February 19, 1998, with respect
to the Notes, by and among the Company, Morgan Stanley & Co.
Incorporated, BancAmerica Robertson Stephens, Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Salomon Brothers Inc
4.1 Indenture, dated June 23, 1997, between the Company and Chase
Manhattan Bank and Trust Company, National Association, as
successor trustee. (1)
4.2 Form of the Notes
____________________
(1) Incorporated by reference to Exhibit 4.1 to the Registrant's Current
Report on Form 8-K dated June 18, 1997.
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EXHIBIT 1.1
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$130,000,000
BRE PROPERTIES, INC.
7 1/8% Notes due 2013
UNDERWRITING AGREEMENT
----------------------
February 19, 1998
Morgan Stanley & Co. Incorporated
BancAmerica Robertson Stephens
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Salomon Brothers Inc
As Representatives of the several Underwriters
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Dear Sirs and Mesdames:
1. Introductory. BRE Properties, Inc., a corporation organized under the
------------
laws of the State of Maryland (the "Company"), proposes to issue and sell,
pursuant to the terms of this Agreement, to the several Underwriters named in
Schedule A hereto (the "Underwriters" which term also shall include any
underwriter substituted as hereinafter provided in Section 10), $130,000,000
aggregate principal amount of its 7 1/8% Notes due 2013 (the "Securities") to be
issued pursuant to an Indenture dated as of June 23, 1997 (the "Indenture")
between the Company and Chase Manhattan Bank and Trust Company, National
Association, as successor trustee (the "Trustee").
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Morgan Stanley & Co. Incorporated, BancAmerica Robertson Stephens, Merrill
Lynch, Pierce, Fenner & Smith Incorporated and Salomon Brothers Inc are acting
as representatives of the several underwriters and in such capacity are
hereinafter referred to as the "Representatives".
2. (a) Representations and Warranties of the Company. The Company
---------------------------------------------
represents and warrants to the several Underwriters, as of the date hereof and
as of the Closing Date (as defined in Section 3), and agrees with the several
Underwriters, as follows:
(i) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (No.
333-24915) for the registration under the Securities Act of 1933, as
amended (the "1933 Act"), of the Securities and certain other securities
and has filed such amendments thereto, if any, as may have been required to
the date hereof. Such registration statement (including all exhibits
thereto, and all documents incorporated or deemed to be incorporated by
reference therein and the information, if any, deemed to be a part thereof
pursuant to Rule 430A(b) of the rules and regulations of the Commission
under the 1933 Act (the "Rules and Regulations")), as amended (if
applicable) at the time such registration became effective, and as from
time to time amended or supplemented pursuant to the 1933 Act, the
Securities Exchange Act of 1934, as amended (the "1934 Act"), or otherwise,
is hereinafter referred to as the "Registration Statement." The Company
proposes to file with the Commission pursuant to Rule 424(b) ("Rule
424(b)") of the Rules and Regulations the Prospectus Supplement (as defined
in Section 4(i) hereof) and, if required pursuant to Rule 424(b), the
related prospectus dated February 19, 1998 (the "Base Prospectus"), and has
previously advised you of all information (financial and other) set forth
therein. The Base Prospectus and the Prospectus Supplement, each in the
form first provided to the Underwriters by the Company for use in
connection with the offering of the Securities (being the forms in which
they are to be filed with the Commission pursuant to Rule 424(b) or, solely
in the case of the Base Prospectus, if the Base Prospectus is not required
to be re-filed with the Commission pursuant to Rule 424(b), being the form
in which the Base Prospectus was most recently filed with the Commission
pursuant to Rule 424(b)), including all documents incorporated or deemed to
be incorporated by reference therein, are hereinafter referred to,
collectively, as the "Prospectus", except that if any revised prospectus or
prospectus supplement shall be provided to the Underwriters by the Company
for use in connection with the offering and sale of the Securities which
differs from the Prospectus first provided to the Underwriters for such
purpose (whether or not such revised prospectus or prospectus supplement is
required to be filed by the Company with the Commission pursuant to Rule
424(b) of the Rules and Regulations), the term "Prospectus" shall refer to
such revised prospectus or prospectus supplement, as the case may be, from
and after the time it is first provided to the Underwriters for such use.
Unless the context otherwise requires, all references in this Agreement to
documents, financial statements and schedules and other information which
is "contained", "included", "stated", "described in" or "referred to" in
the Registration Statement or the Prospectus (and all other references of
like import) shall be deemed to mean and include all such documents,
financial statements and schedules
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and other information which is or is deemed to be incorporated by reference
in the Registration Statement or the Prospectus, as the case may be; and
all references in this Agreement to amendments or supplements to the
Registration Statement or the Prospec tus shall be deemed to mean and
include the filing of any document under the 1934 Act after the date of
this Agreement which is or is deemed to be incorporated by reference in the
Registration Statement or the Prospectus, as the case may be. For purposes
of this Agreement, all references to the Registration Statement, any
prelimi nary prospectus supplement, any preliminary prospectus, the
Prospectus Supplement, the Prospectus or any amendment or supplement to any
of the foregoing shall be deemed to include the copy filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("EDGAR").
(ii) The Registration Statement has become effective under the
1933 Act, and no stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to the
knowledge of the Company, are contemplated by the Commis sion, and any
request on the part of the Commission for additional information has been
complied with. The Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended (the "1939 Act"), and the predecessor
trustee under the Indenture duly filed with the Commission a Statement of
Eligibility on Form T-1 (a "Form T-1") as part of the Registration
Statement and no Form T-1 is required to be filed by the Trustee, as
successor trustee under the Indenture, in connection with the Securities.
At the respective times the Registration Statement and any
post-effective amendments thereto became or become effective, as the case
may be, and at the Closing Date, the Registration Statement complied and
will comply in all material respects with the requirements of the 1933 Act
and the Rules and Regulations and with the 1939 Act and the rules and
regulations of the Commission under the 1939 Act (the "1939 Act
Regulations"), and did not and will not contain any 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. The
Prospectus does not and will not include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that the foregoing
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representations, warranties and agreements shall not apply to information
contained in or omitted from the Registration Statement or the Prospectus
in reliance upon, and in conformity with, written information furnished to
the Company by or on behalf of any Underwriter through the Representatives
specifically for use in the preparation thereof.
Any preliminary prospectus supplement, any preliminary
prospectus and the Prospectus and any amendment or supplement thereto
delivered to the Underwriters for use in connection with the offering of
the Securities was identical to the respective electronically transmitted
copies thereof filed with the Commission pursuant to EDGAR, except to the
extent permitted by Regulation S-T.
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(iii) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement and the Prospectus, when they were
filed with the Commission, complied in all material respects to the
requirements of the 1934 Act and the published 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, in the
light of the circumstances under which they were made, not misleading; and
any further documents so filed and incorporated or deemed to be
incorporated by reference, when they are filed with the Commission, will
comply in all material respects to the requirements of the 1934 Act and the
published rules and regulations of the Commis sion 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, in the light of the circumstances under which they were made, not
misleading.
(iv) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or other wise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from that
set forth in the Prospectus (exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement). Since the respective
dates as of which information is given in the Registration Statement and
the Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement), except as otherwise stated
therein or contemplated thereby, (A) there has been no change in the
consolidated capital stock or the consolidated long-term debt of the
Company, (B) there have been no transactions entered into by the Company or
any of its subsidiaries which are material to the Company and its
subsidiaries considered as one enterprise, other than those entered into in
the ordinary course of its business, and (C) except for regular quarterly
dividends, there has been no dividend or distribution of any kind declared,
paid or made by the Company on its shares of capital stock.
(v) The financial statements of the Company, of Promontory Point
Apartments ("PPA"), of Red Hawk Ranch ("RHR"), of Foster's Landing
Apartments ("FLA"), of Lakeshore Landing Apartments ("LLA"), and of certain
Trammell Crow Residential multifamily properties (collectively, "TCRW")
included in the Registration Statement and the Prospectus, in each case,
together with the related notes and supporting schedules (if any), present
fairly the financial position of the Company, of PPA, of RHR, of FLA, of
LLA, and of TCRW, respectively, at the dates indicated and the financial
condition, results of operations, cash flows and shareholders' equity of
the Company and its subsidiaries, the gross income and direct operating
expenses of PPA, of RHR, of FLA and of LLA, and combined gross income and
direct operating expenses of TCRW, respectively, as at the respective dates
and for the respective periods therein indicated, and such financial
statements and related notes and supporting schedules have been prepared in
conformity with generally accepted accounting principles ("GAAP") applied
on a consistent basis throughout the periods involved, except as may be set
forth therein or in the Prospectus. The selected financial data and, if
applicable, the summary financial information included in the Prospectus
present fairly the information shown therein and have been compiled on a
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basis consistent with that of the Company's audited financial statements
included in the Registration Statement.
(vi) The accountants who have certified the financial statements
and supporting schedules included in the Registration Statement and the
Prospectus are independent public accountants as required by the 1933 Act
and the Rules and Regulations.
(vii) The pro forma condensed financial statements, together with
the related notes and any supporting schedules, included in the
Registration Statement and the Prospectus present fairly the information
shown therein, have been prepared on a basis substantially consistent with
the audited financial statements of the Company set forth therein, the
assumptions on which such pro forma financial statements have been prepared
are reasonable and are set forth in the notes thereto, and such pro forma
condensed financial statements have been prepared, and the pro forma
adjustments set forth therein have been applied, in accordance with the
applicable accounting require ments of the 1933 Act and the Rules and
Regulations (including, without limitation, Regulation S-X promulgated by
the Commission), and such pro forma adjustments have been properly applied
to the historical amounts in the compilation of such statements.
(viii) The Company has been duly organized and is validly existing
as a cor poration in good standing under the laws of the State of Maryland;
the Company has power and authority to own, lease and operate its
properties and conduct its business as described in the Registration
Statement and the Prospectus; the Company is duly qualified as a foreign
corporation to transact business and is in good standing in the State of
Arizona, the State of California, the State of Colorado, the State of
Nevada, the State of New Mexico, the State of Oregon, the State of
Washington and the State of Utah; and the Company is duly qualified as a
foreign corporation to transact business and is in good standing in each
other jurisdiction in which such qualification is required, except where
the failure to be so qualified or in good standing would not have a
material adverse effect on the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise.
(ix) Attached hereto as Schedule C is a true and complete list of
all subsidiaries of the Company and all other corporations, partnerships,
joint ventures, limited liability companies and other entities in which the
Company directly or indirectly owns capital stock or any other equity or
ownership interest. Schedule C accurately sets forth the jurisdiction of
organization of, and the Company's approximate percentage ownership
interest in, each such subsidiary and other entity. The Company does not
have any subsidiaries other than those listed on Schedule C and, except as
set forth in Schedule C, the Company does not directly or indirectly own
any capital stock or other equity or other ownership interests in any
corporation, partnership, joint venture, limited liability company or other
entity. Schedule C also
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correctly indicates whether each such subsidiary and other entity listed
thereon is a corporation, partnership, limited liability company or other
type of entity.
(x) Each subsidiary of the Company has been duly organized and
is validly existing and in good standing under the laws of the jurisdiction
of its organization, has power and authority to own, lease and operate its
property and conduct its business as described in the Registration
Statement and the Prospectus, and is duly qualified to transact business
and is in good standing in each jurisdiction in which such qualification is
required, except where the failure to be so qualified or in good standing
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 its subsidiaries considered as one enterprise; and (A) all
of the issued and outstanding shares of capital stock of each such
subsidiary that is a corporation have been duly authorized and validly
issued, are fully paid and non-assessable and, except as set forth on
Schedule C, are and, at all times since the date on which such subsidiary
was organized, have been owned by the Company, directly or through wholly-
owned subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity, (B) all of the issued and
outstanding limited liability company interests of each such subsidiary
that is a limited liability company have been duly authorized and validly
issued (under applicable law and the limited liability company agreement of
such subsidiary), are fully paid and non-assessable and, except as set
forth on Schedule C, are owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity, and (C) all of the issued and
outstanding limited and general partnership interests of each such
subsidiary that is a partnership have been duly authorized (if applicable)
and validly issued and, except as set forth on Schedule C, are owned by the
Company, directly or through subsidiaries free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity.
(xi) The Company and its subsidiaries own or possess or have
obtained all material governmental licenses, permits, consents, orders,
approvals and other authori zations necessary to lease or own, as the case
may be, and to operate their respective properties and to carry on their
respective businesses as contemplated in the Prospectus.
(xii) The Company is not required to be registered under the
Investment Company Act of 1940, as amended.
(xiii) The authorized, issued and outstanding shares of capital
stock of the Company are as set forth in the Prospectus under the caption
"Capitalization" (except for subsequent issuances, if any, of the Company's
common stock, par value $.01 per share (the "Common Stock"), pursuant to
employee benefit, employee and director stock option and dividend
reinvestment plans or upon conversion of convertible securities or upon
exchange of exchangeable securities referred to in the Prospectus or other
subsequent issuances of Common Stock referred to in the Prospectus). The
shares of issued and outstanding Common Stock have been duly authorized and
validly
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issued, are fully paid and non-assessable; and none of the outstanding
shares of Common Stock was issued in violation of any preemptive or other
similar rights arising by operation of law, under the charter or by-laws of
the Company, under any agreement or instrument to which the Company or any
of its subsidiaries is a party or otherwise.
(xiv) Neither the Company nor any of its subsidiaries is in
violation of its charter or by-laws, certificate of limited partnership,
limited partnership agreement, certificate of formation of a limited
liability company, limited liability company agreement or other similar
organizational certificates, instruments, agreements or documents
(collectively, "Organizational Documents"), as the case may be; neither the
Company nor any of its subsidiaries is in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which it is a party or by which it or any of its property or
assets may be bound, except for such defaults which would not, individually
or in the aggregate, have a material adverse effect on the condition
(financial or otherwise) or on the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise;
and the execution, delivery and performance of this Agreement, the
Indenture and the Securi ties, the consummation of the transactions
contemplated herein and therein (including, without limitation, the
incurrence of the indebtedness evidenced by the Securities), and compliance
by the Company with its obligations hereunder and thereunder, have been
duly authorized by all necessary corporate action and will not conflict
with or constitute a breach of, or default under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to, any Subject
Agreement (as defined below) or any other material contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which the
Company or any of its subsidiaries is a party or by which the Company or
any of its subsidiaries is bound or to which any of the property or assets
of the Company or any of its subsidiaries is subject, nor will such action
result in any violation of the provisions of the Organizational Documents
of the Company or its subsidiaries or any applicable law, administrative
regulation or administrative or court decree; and no consent, approval,
authorization or order of any court or governmental authority or agency is
required for the consummation by the Company of the transac tions
contemplated by this Agreement, the Indenture or the Securities, except
such as may be required under state securities or Blue Sky laws of any
jurisdiction or real estate syndication laws in connection with the
purchase and distribution of the Securi ties by the Underwriters. "Subject
Agreements" means (i) the Loan Agreement dated as of January 31, 1994
between The Prudential Insurance Company of America and the Company (as
successor by merger to Real Estate Investment Trust of California), as
amended by the First Amendment to Loan Agreement dated as of July 7, 1995,
the Second Amendment to Loan Agreement dated as of April 30, 1996, the
Third Amend ment to Loan Agreement dated as of November 20, 1996, the
Fourth Amendment to Loan Agreement dated as of February 25, 1997 and the
Fifth Amendment to Loan Agreement dated as of June 30, 1997, (ii) the Loan
Agreement dated as of July 7, 1995 between The Prudential Insurance Company
of America and the Company (as
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successor by merger to Real Estate Investment Trust of California), as
amended by the First Agreement to Loan Agreement dated as of April 30,
1996, the Second Agreement to Loan Agreement dated as of November 20, 1996,
the Third Amendment to Loan Agreement dated as of February 25, 1997 and the
Fourth Amendment to Loan Agree ment dated as of June 30, 1997, (iii) the
Unsecured Line of Credit Loan Agreement dated as of November 17, 1997 (the
"Credit Agreement") between Bank of America National Trust and Savings
Association ("Bank of America") and the Company, as amended by the
Modification Agreement to Syndicate Loan dated as of January 20, 1998
between the Company and Bank of America, as agent for the several financial
institutions a party thereto, together with all guarantees entered into by
any subsidiaries of the Company in connection therewith, (iv) the Amended
and Restated Credit Agreement between the Company and Sanwa Bank California
dated as of December 31, 1997 (the "Sanwa Credit Agreement"), together with
all guarantees entered into by any subsidiaries of the Company in
connection therewith, (v) the Contribution Agreement dated as of September
29, 1997, as amended (the "Contribu tion Agreement"), between the TCR
signatories named on Schedule A thereto, the Company and BRE Property
Investors LLC, a Delaware limited liability company (the "Operating
Company"), together with the guarantee entered into by the Company pursuant
to the Contribution Agreement, as amended by Amendment No. 1 to the
Contribution Agreement dated November 18, 1997, (vi) the Amended and
Restated Limited Liability Company Agreement of the Operating Company, and
(vii) the Amended and Restated Limited Liability Company Agreement of Blue
Ravine Investors, LLC, a Delaware limited liability company ("Blue
Ravine"); "Prudential Agreements" means the Loan Agreements, as amended,
referred to in clauses (i) and (ii) of this sentence; and "LLC Agreements"
means the Amended and Restated Limited Liability Company Agreements
referred to in clauses (vi) and (vii) of this sentence. All amendments,
supplements and restatements of the Subject Agreements are listed in
clauses (i) through (vii) of the preceding sentence. Except as otherwise
described in the Prospectus, no subsidiary of the Company is a guarantor
of, or is a party to or bound by any instrument or agreement pursuant to
which it has guaranteed or may be required to guarantee or cause another
subsidiary of the Company to guarantee, any borrowings or other
indebtedness of the Company. Except as otherwise described in the
Prospectus, the Company is not a party to or bound by any instrument or
agreement pursuant to which it is or may be required to cause any of its
subsidiaries to guarantee any borrowings or other indebtedness of the
Company.
(xv) The Company was and is organized to qualify as a "real
estate invest ment trust" under the Internal Revenue Code of 1986, as
amended (the "Code"); the Company at all times since its organization has
elected to be taxed as a "real estate investment trust"; the Company has
qualified as a "real estate investment trust" under the Code for its
taxable years ended July 31, 1995, its short taxable year ended December
31, 1995, its taxable year ended December 31, 1996 and its taxable year
ended December 31, 1997, and will continue to qualify as a "real estate
investment trust" under the Code after consummation of the transactions
contemplated by the Prospectus; and the Company's present and contemplated
operations, assets and income will enable the Company to meet the
requirements for qualification as a "real
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estate investment trust" under the Code. United States Federal income tax
returns of the Company have been closed through the fiscal year of the
Company ended July 31, 1994. As used in this paragraph (xv), the term
"Company" includes BankAmerica Realty Investors, a California business
trust, and BRE Properties, Inc., a Delaware corporation, which are both
predecessors to BRE Properties, Inc., a Maryland corporation.
(xvi) Each entity listed on Schedule C either qualifies as a
partnership for federal, state and local income tax purposes or as a
"qualified REIT subsidiary" within the meaning of Section 856(i) of the
Code or qualifies to be disregarded as an entity separate from the Company
or one of its subsidiaries for federal, state and local income tax
purposes.
(xvii) There is no action, suit or proceeding before or by any
court or govern mental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, threatened against or affecting the
Company or any of its subsidiaries, which is required to be disclosed in
the Registration Statement or the Prospectus (other than as disclosed
therein) or which might result in any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, or which might materially and adversely affect the properties
or assets of the Company or any of its subsidiaries; and there are no
contracts or documents of the Company or any of its subsidiaries which are
required to be filed as exhibits to the Registration Statement or any
document incorporated or deemed to be incorporated therein by the 1933 Act,
the Rules and Regulations, the 1934 Act or the rules and regulations of the
Commission thereunder which have not been so filed.
(xviii) The Company is eligible to use a Form S-3 registration
statement under the 1933 Act. The Company is also eligible to use Form S-3
pursuant to the standards for that Form in effect immediately prior to
October 21, 1992.
(xix) Neither the Company nor any of its subsidiaries nor any of
their respective officers or directors has taken nor will any of them take,
directly or indirectly, any action resulting in a violation of Regulation M
under the 1934 Act, or designed to cause or result in, or which has
constituted or which reasonably might be expected to constitute, the
stabilization or manipulation of the price of the Securities or
facilitation of the sale or resale of the Securities.
(xx) Neither the Company nor any of its subsidiaries is required to
own or possess any trademarks, service marks, trade names or copyrights in
order to conduct the business now operated by it.
(xxi) The Company has full right, power and authority to enter into
this Agreement, the Indenture and the Securities; this Agreement has been
duly authorized, executed and delivered by the Company.
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(xxii) Except as otherwise disclosed in the Prospectus: (A) the
Company and its subsidiaries have good and marketable title in fee simple
to all real property and improvements described in the Prospectus as being
owned by the Company (none of which is leased by the Company or any of its
subsidiaries, as lessee); (B) all liens, charges, encumbrances, claims or
restrictions on or affecting the real property and improvements of the
Company or any of its subsidiaries which are required to be disclosed in
the Prospectus are disclosed therein; (C) neither the Company nor any of
its subsidiaries nor any lessee of any portion of the real property or
improvements of the Company or any of its subsidiaries is in default under
any of the leases pursuant to which the Company or any of its subsidiaries
leases (as lessor) its real property or improvements and the Company knows
of no event which, but for the passage of time or the giving of notice, or
both, would constitute a default under any of such leases, except such
defaults that would not, individually or in the aggregate, have a material
adverse effect on the condition, financial or otherwise, or on earnings,
business affairs or business prospects of the Company and its subsidiaries
considered as one enterprise; (D) no tenant under any of the leases
pursuant to which the Company or any of its subsidiaries leases any of its
real property or improvements has an option or right of first refusal to
purchase the premises demised under such lease; (E) all of the real
property and improvements of the Company and its subsidiaries comply with
all applicable codes and zoning laws and regulations, except for such
failures to comply which would not, individually or in the aggregate, have
a material adverse effect on the condition, financial or otherwise, or on
the earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; and (F) the Company has no
knowledge of any pending or threatened condemnation, zoning change or other
proceeding or action that would in any manner affect the size of, use of,
improvements on, construction on, or access to any of the real property of
the Company or any of its subsidiaries, except such proceedings or actions
that would not, individually or in the aggregate, have a material adverse
effect on the condition, financial or otherwise, or earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise.
(xxiii) The Company maintains a system of internal accounting
controls suffi cient to provide reasonable assurances that (A) transactions
are executed in accordance with management's general or specific
authorizations; (B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (C) access
to assets is permitted only in accordance with management's general or
specific authori zations; and (D) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences. Neither the Company nor
any of its subsidiaries nor any of their respective employees or agents has
made any payment of funds of the Company or any of its subsidiaries or
received or retained any funds in violation of any law, rule or regulation
which payment, receipt or retention of funds is of a character required to
be disclosed in the Prospectus.
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<PAGE>
(xxiv) Except as otherwise set forth in the Registration Statement,
(A) to the best knowledge and information of the Company, neither the
Company nor any of its subsidiaries has at any time, and no other party has
at any time, handled, buried, stored, retained, refined, transported,
processed, manufactured, generated, produced, spilled, allowed to seep,
leak, escape or leach, or pumped, poured, emitted, emptied, discharged,
injected, dumped, transferred or otherwise disposed of or dealt with
Hazardous Materials (hereinafter defined) on, to or from real property
owned, leased or otherwise utilized by the Company or any of its
subsidiaries or in which the Company or any of its subsidiaries has any
ownership interest, including without limitation any subsurface soils and
ground water (the "Premises"), except for such cases as (u) are not
required to be disclosed in the Registration Statement and (v) would not,
individually or in the aggregate, have a material adverse effect on the
condition (financial or otherwise) or the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, (B) to the best know ledge and information of the Company, no
seepage, leak, escape, leach, discharge, injection, release, emission,
spill, pumping, pouring, emptying or dumping of Hazardous Materials from or
to the Premises has occurred, except for such cases as (w) are not required
to be disclosed in the Registration Statement and (x) would not,
individually or in the aggregate, have a material adverse effect on the
condition (financial or otherwise) or the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, (C) neither the Company nor any of its subsidiaries has
received notice of any claim, or has knowledge of any occurrence or
circumstance which with notice or passage of time or both would give rise
to a claim, under or pursuant to any Environmental Statute (as hereinafter
defined), except for such claims as (y) are not required to be disclosed in
the Registration Statement and (z) would not, individually or in the
aggregate, have a material adverse effect on the condition (financial or
otherwise) or the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, and (D) to the
best of Company's knowledge and information, no part of the Premises is
included or proposed for inclusion on the National Priorities List issued
pursuant to CERCLA (hereinafter defined) by the United States Environ
mental Protection Agency (the "EPA") or on the inventory of other potential
"problem" sites issued by the EPA and has not otherwise been identified by
the EPA as a potential CERCLA site or included or proposed for inclusion on
any list or inventory issued pursuant to any other Environmental Statute or
issued by any other Governmen tal Authority (hereinafter defined). As used
herein "Hazardous Material" shall include without limitation, any flammable
explosives, radioactive materials, hazardous materials, hazardous wastes,
hazardous or toxic substances, or related materials, asbestos or any
material containing asbestos, or any other substance or material as defined
by any Federal, state or local environmental law, ordinance, rule, or
regulation including, without limitation, the Comprehensive Environmental
Response, Compensa tion, and Liability Act of 1980, as amended (42 U.S.C.
Sections 9601, et seq.) ("CERCLA"), the Hazardous Materials Transportation
-- ---
Act, as amended (49 U.S.C. Sections 1801, et seq.), the Resource
-- ---
Conservation and Recovery Act, as amended (42 U.S.C. Sections 6901 et seq.)
-- ---
and in the regulations adopted and publications promul gated pursuant to
each of the foregoing (individually, an "Environmental Statute") or
11
<PAGE>
by any Federal, state or local governmental authority having or claiming
jurisdiction over the Premises (a "Governmental Authority").
(xxv) The issuance, sale and public offering of the Securities to
be issued and sold by the Company have been approved by a majority of all
of the "Continuing Directors" and do not constitute a "Business
Combination" (as such terms are defined in Article IX of the Company's
charter).
(xxvi) To the extent applicable, the Company has complied and will
comply with the provisions of that certain Florida act relating to
disclosure of doing business with Cuba, codified as Section 517.075 of the
Florida statutes, and the rules and regulations thereunder (collectively,
the "Cuba Act") or is exempt therefrom.
(xxvii) The Indenture has been duly authorized by the Company and,
at the Closing Date, will have been duly executed and delivered by the
Company and will constitute a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
creditor's rights generally or by general equitable principles.
(xxviii) The Securities have been duly authorized and, at the Closing
Date, will have been duly executed by the Company and, when authenticated
in the manner provided for in the Indenture and delivered against payment
of the purchase price therefor specified in this Agreement, will constitute
valid and binding obligations of the Company, enforceable against the
Company in accordance with their terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting creditors' rights generally or
by general equitable principles, and will be entitled to the benefits of
the Indenture.
(xxix) The Securities and the Indenture will conform in all material
respects to the respective statements relating thereto contained in the
Prospectus and will be in substantially the respective forms filed or
incorporated by reference, as the case may be, as exhibits to the
Registration Statement.
(xxx) The Securities rank and will rank on a parity with all
unsecured indebtedness of the Company (other than subordinated indebtedness
of the Company) that is outstanding on the date hereof or that may be
incurred hereafter, and senior to all subordinated indebtedness of the
Company that is outstanding on the date hereof or that may be incurred
hereafter.
(xxxi) The Company has notified the Lender (as defined in the
Prudential Agreements) of the terms and conditions of the Securities and
the offering made hereby and the Company has obtained a written consent
from the Lender to the issuance of the Securities (the "Written Consent"),
which Written Consent is in full force and effect.
12
<PAGE>
(xxxii) The Securities and the indebtedness evidenced thereby do not
and will not constitute "Funding Debt" (within the meaning of the LLC
Agreements) and no portion of the proceeds from the issuance of the
Securities will be applied to make any Managing Member Loan (within the
meaning of the LLC Agreements).
(xxxiii) Immediately prior to the issuance of the Securities on the
Closing Date, securities with an aggregate initial public offering price of
$162.7 million will have been issued under the Registration Statement.
(b) Any certificate signed by any officer of the Company and delivered to
the Representatives or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby.
3. Purchase by and Sale and Delivery to, the Underwriters; Closing Date.
--------------------------------------------------------------------
On the basis of the representations, warranties, covenants and agreements herein
contained, and subject to the terms and conditions herein set forth, the Company
hereby agrees to sell to the Underwriters and the Underwriters agree, severally
and not jointly, to purchase from the Company at the price set forth in Schedule
B hereto, the aggregate principal amount of Securities set forth opposite their
respective names in Schedule A, subject to adjustment in accordance with Section
10 hereof.
The Company will deliver the Securities to the Representatives, for the
respective accounts of the several Underwriters (in the form of definitive
certificates, issued in such names and in such denominations as the
Representatives may direct by notice in writing to the Company given not later
than one full business day prior to the Closing Date or, if no such direction is
received, in the name of Cede & Co.), against payment of the purchase price
therefor by wire transfer of immediately available funds, at the offices of
Brown & Wood LLP, 555 California Street, San Francisco, California 94104. The
time and date of delivery and closing shall be at 10:00 A.M., New York time, on
the third (fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any
given day), business day after the date hereof; provided, however, that such
--------
date and time may be accelerated or extended by agreement between the Company
and the Representatives or postponed pursuant to the provisions of Section 10
hereof. The time and date of such payment and delivery are herein referred to
as the "Closing Date". The Company shall make the certificates for the
Securities available to the Representatives for examination on behalf of the
Underwriters not later than 10:00 A.M., New York time, on the business day
preceding the Closing Date in New York, New York.
It is understood that Morgan Stanley & Co. Incorporated and BancAmerica
Robertson Stephens, Merrill Lynch, Pierce, Fenner & Smith Incorporated or
Salomon Brothers Inc individually may (but shall not be obligated to) make
payment to the Company on behalf of any Underwriter or Underwriters for the
Securities to be purchased by such Underwriter or Underwriters. Any such
payment by Morgan Stanley & Co. Incorporated, BancAmerica Robertson Stephens,
Merrill Lynch, Pierce, Fenner & Smith Incorporated or Salomon Brothers Inc shall
not relieve such Underwriter or Underwriters from any of its or their other
obligations hereunder.
13
<PAGE>
After the execution and delivery of this Agreement, the several
Underwriters propose to make an initial public offering of the Securities at the
initial public offering price set forth in Schedule B hereto.
4. Covenants and Agreements of the Company. The Company covenants and
---------------------------------------
agrees with the several Underwriters that:
(a) The Company will advise the Representatives promptly of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the institution of any proceedings for that
purpose, and will use its best efforts to prevent the issuance of any such stop
order and to obtain as soon as possible the lifting thereof, if issued. The
Company will advise the Representatives promptly of any request by the
Commission for any amendment of or supplement to the Registration Statement or
the Prospectus or for addi tional information, and will not at any time file any
amendment to the Registration Statement or supplement to the Prospectus which
shall not previously have been submitted to the Representatives a reasonable
time prior to the proposed filing or use thereof or to which the Representatives
shall reasonably object in writing or which is not in compliance with the 1933
Act and the Rules and Regulations. The Company will advise the Representatives
promptly when the Prospectus has been filed pursuant to Rule 424(b) of the Rules
and Regulations.
(b) The Company will prepare and file with the Commission, promptly upon
the request of the Representatives, any amendments or supplements to the
Registration Statement or the Prospectus which in the opinion of the
Representatives may be necessary to enable the several Underwriters to continue
the distribution of the Securities and, in the case of any such amendments to
the Registration Statement, will use its best efforts to cause the same to
become effective as promptly as possible. The Company will promptly file all
reports and any definitive proxy or information statements required to be filed
with the Commission pursuant to Section 13, 14 or 15(d) of the 1934 Act for so
long as the delivery of a prospectus is required in connection with the offering
or sale of the Securities.
(c) If at any time when a prospectus relating to the Securities is
required to be delivered under the 1933 Act any event occurs as a result of
which the Prospectus would include an untrue statement of a material fact or
omit to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or if it
is necessary at any time to amend the Prospectus to comply with the 1933 Act or
the Rules and Regulations, the Company will promptly notify the Representatives
thereof and will prepare an amended or supplemented Prospectus (in form and
substance reasonably satisfactory to counsel to the Underwriters) or, with the
consent of counsel to the Underwriters, make an appropriate filing pursuant to
Section 13 or 14 of the 1934 Act which will correct such statement or omission;
and, in case any Underwriter is required to deliver a prospectus relating to the
Securities nine months or more after the date of this Agreement, the Company
upon the request of the Representatives and at the expense of such Underwriters
will prepare promptly such prospectus or prospectuses as may be necessary to
permit compliance with the requirements of Section 10(a)(3) of the 1933 Act.
14
<PAGE>
(d) The Company will deliver to the Representatives, at or before the
Closing Date, signed copies of the Registration Statement and all amendments
thereto (including all financial statements and exhibits thereto and all
documents incorporated or deemed to be incorporated by reference therein) and
will deliver to the Representatives such number of copies of the Registration
Statement, including such financial statements and all documents incorporated or
deemed to be incorporated by reference therein but without exhibits, and of all
amendments thereto, as the Representatives may reasonably request. The Company
will deliver or mail to or upon the order of the Representatives on the date of
the initial public offering, and there after from time to time during the period
when delivery of a prospectus relating to the Securi ties is required under the
1933 Act, as many copies of the Prospectus, in final form or as thereafter
amended or supplemented, as the Representatives may reasonably request;
provided, however, that the expense of the preparation and delivery of any
- -------- -------
prospectus required for use nine months or more after the date of this
Agreement, shall be borne by the Underwriters required to deliver such
prospectus. The copies of the Registration Statement and each amendment thereto
and the copies of any preliminary prospectus and any preliminary prospec tus
supplement and the Prospectus and any amendments or supplements thereto
furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to EDGAR, except
to the extent permitted by Regulation S-T.
(e) The Company will make generally available to its security holders as
soon as practicable, but in any event not later than 60 days after the close of
the period covered thereby, an earnings statement (in form complying with the
provisions of Rule 158 under the 1933 Act) which will be in reasonable detail
(but which need not be audited) and which will comply with Section 11(a) of the
1933 Act, covering a period of at least twelve months beginning not later than
the first day of the Company's fiscal quarter next following the "effective
date" (as defined in said Rule 158) of the Registration Statement.
(f) The Company will cooperate with the Representatives to enable the
Securities to be qualified for sale under the securities laws and real estate
syndication laws of such states and other jurisdictions as the Representatives
may reasonably designate and at the request of the Representatives will make
such applications and furnish such information as may reasona bly be required of
it as the issuer of the Securities for that purpose; provided, however, that the
-------- -------
Company shall not be required to qualify to do business or to file a general
consent to service of process in any such jurisdiction. The Company will, from
time to time, prepare and file such statements and reports as are or may be
required of it as the issuer of the Securities to continue such qualifications
in effect for so long a period as the Representatives may reasonably request for
the distribution of the Securities.
(g) The Company will furnish to its shareholders annual reports containing
financial statements certified by independent public accountants and with
quarterly summary financial information, in reasonable detail which may be
unaudited. During the period of five years from the date hereof, the Company
will deliver to the Representatives and, upon request, to each of the other
Underwriters, copies of each annual report of the Company and each other report
furnished by the Company to its shareholders; and will deliver to the
Representatives, as soon as they are available, copies of any other reports
(financial or other) which the Company shall publish or otherwise make available
to any of its security holders as
15
<PAGE>
such and, as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national securities
exchange.
(h) The Company will use the net proceeds received by it from the sale of
the Securities sold by it in the manner specified in the Prospectus Supplement
under "Use of Proceeds".
(i) Immediately following the execution of this Agreement, the Company
will prepare a prospectus supplement, dated the date hereof (the "Prospectus
Supplement"), containing the public offering price of the Securities, the
underwriting discounts and commissions, the plan of distribution of the
Securities and such other information as may be required by the 1933 Act or the
Rules and Regulations or as the Representatives and the Company deem
appropriate, and will file or transmit for filing with the Commission in
accordance with Rule 424(b) of the Rules and Regulations copies of such
Prospectus Supplement and, if required by Rule 424(b), the Base Prospectus.
(j) During the period beginning on the date hereof and continuing through
and including the Closing Date, the Company will not offer, sell, contract to
sell or otherwise dispose of any debt securities of the Company or any of its
subsidiaries which are substan tially similar to the Securities (other than the
Securities) or any securities convertible into or exchangeable or exercisable
for any debt securities of the Company or any of its subsidiaries which are
substantially similar to the Securities or any rights, warrants or options to
purchase any debt securities of the Company or any of its subsidiaries which are
substantially similar to the Securities, without your prior written consent.
(k) The Company will use its best efforts to continue to meet the
requirements to qualify as a "real estate investment trust" under the Code.
(l) In accordance with the provisions of the Cuba Act, if applicable, and
without limitation to the provisions of Section 6 hereof, the Company will
indemnify each Underwriter against any and all losses, claims, damages,
liabilities and expenses (including attorneys' fees) arising out of or based
upon any violation by the Company of the Cuba Act.
5. Payment of Expenses. The Company will pay (directly or by
-------------------
reimbursement) all expenses incident to the performance of its obligations under
this Agreement, including but not limited to all expenses and taxes incident to
delivery of the Securities to the Representa tives, all expenses incident to the
registration of the Securities under the 1933 Act and the printing of copies of
the Registration Statement, any preliminary prospectus, any preliminary
prospectus supplement, the Prospectus, any amendments or supplements thereto,
all expenses incident to the preparation, word processing, printing and delivery
of all "Blue Sky" memo randa, this Agreement, the Securities and the Indenture
and furnishing the same to the Underwriters and dealers except as otherwise
provided in Sections 4(c) and 4(d), the fees and disbursements of the Company's
counsel and accountants, all filing and printing fees and expenses (including
reasonable legal fees and disbursements of counsel for the Underwriters)
incurred in connection with qualification or exemption of the Securities for
sale under securities laws and real estate syndication laws of such
jurisdictions as the Representatives
16
<PAGE>
may designate, all fees and expenses paid or incurred in connection with any
filings made with the National Association of Securities Dealers, Inc., the fees
and expenses of the Trustee, including, if required, the fees and disbursements
of counsel for the Trustee in connection with the Indenture and the Securities,
any fees payable in connection with the rating of the Securities, the fees and
expenses of any depositary in connection with holding the Securities in book-
entry form, the costs of preparing certificates evidencing the Securities, and
all other costs and expenses incident to the performance of its obligations
hereunder which are not otherwise specifically provided for in this Section.
6. Indemnification and Contribution. (a) The Company agrees to
--------------------------------
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the 1933 Act
or Section 20 of the 1934 Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any amendment
thereof, any preliminary prospectus, any preliminary prospectus supplement or
the Prospectus (as amended or supple mented if the Company shall have furnished
any amendments or supplements thereto), or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein; provided, however, that the
-------- -------
foregoing 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, claims, damages or liabilities purchased Securities, or any person
controlling such Underwriter, if a copy of the Prospectus (excluding documents
incor porated by reference therein) was not sent or given by or on behalf of
such Underwriter to such person, if required by law so to have been delivered,
at or prior to the written confirma tion of the sale of the Securities to such
person, and if the Prospectus (excluding documents incorporated by reference
therein) would have cured the defect giving rise to such losses, claims, damages
or liabilities.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, each of the Company's directors, each of the
Company's officers who signed the Registration Statement and each person, if
any, who controls the Company within the meaning of either Section 15 of the
1933 Act or Section 20 of the 1934 Act from and against any and all losses,
claims, damages and liabilities (including, without limitation, any legal or
other expenses reasonably incurred in connection with defending or investigating
any such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or any
amendment thereof, any preliminary prospectus, any preliminary prospectus
supplement or the Prospectus (as amended or supple mented if the Company shall
have furnished any amendments or supplements thereto), or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, but only
with reference to information relating to such Underwriter furnished to the
Company in writing by
17
<PAGE>
such Underwriter through you expressly for use in the Registration Statement,
any preliminary prospectus, any preliminary prospectus supplement, the
Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to para graph (a) or (b) of this Section 6, such person (the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for (i) the fees and expenses of more than one separate firm (in
addition to any local counsel) for all Underwriters and all persons, if any, who
control any Underwriter within the meaning of either Section 15 of the 1933 Act
or Section 20 of the 1934 Act and (ii) the fees and expenses of more than one
separate firm (in addition to any local counsel) for the Company, its directors,
its officers who signed the Registration State ment and each person, if any, who
controls the Company within the meaning of either such Section. In the case of
any such separate firm for the Underwriters and such control persons of any
Underwriters, such firm shall be designated in writing by Morgan Stanley & Co.
Incor porated. In the case of any such separate firm for the Company, and such
directors, officers and control persons of the Company, such firm shall be
designated in writing by the Company. The indemnifying party shall not be liable
for any settlement of any proceeding effected without its written consent, but
if settled with such consent or if there be a final judgment for the plaintiff,
the indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement or judgment. Notwith
standing the foregoing sentence, if at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for fees and
expenses of counsel as contemplated by the second and third sentences of this
paragraph, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought here under by such indemnified
party, unless such settlement includes an unconditional release of
18
<PAGE>
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(d) To the extent the indemnification provided for in paragraph (a) or (b)
of this Section 6 is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
each indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand from the offering of the
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the indemnifying party or parties on the one hand and of the
indemnified party or parties on the other hand in connection with the statements
or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other hand
in connection with the offering of the Securities shall be deemed to be in the
same respective proportions as the net proceeds from the offering of the
Securities (before deducting expenses) received by the Company and the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover of the Prospectus, bear to the
aggregate Public Offering Price (as defined in Schedule B hereto) (excluding
accrued interest) of the Securities. The relative fault of the Company on the
one hand and the Underwriters on the other hand 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 or by the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Underwriters' respective
obligations to contribute pursuant to this Section 6 are several in proportion
to the respective aggregate principal amount of Securities they have purchased
hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just or
equitable if contribution pursuant to this Section 6 were determined by pro rata
--- ----
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of alloca tion that does not take account of the
equitable considerations referred to in paragraph (d) of this Section 6. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, 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 Section 6, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages that 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 1933
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent
19
<PAGE>
misrepresentation. The remedies provided for in this Section 6 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this Section 6,
and the representations, warranties and other statements of the Company
contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of any Underwriter or any person controlling any Underwriter or
the Company, its officers or directors or any person controlling the Company and
(iii) acceptance of and payment for any of the Securities.
7. Conditions of Underwriters' Obligations. The respective obligations
---------------------------------------
of the several Underwriters hereunder shall be subject to the accuracy, at and
(except as otherwise stated herein) as of the date of this Agreement and the
Closing Date, of the representations and warranties made herein by the Company
and of the statements of the Company's officers or directors in any certificates
furnished pursuant to the provisions hereof, to compliance at and as of the
Closing Date by the Company with the covenants and agreements herein contained
and other provisions hereof to be satisfied at or prior to the Closing Date and
to the following additional conditions:
(a) The Registration Statement shall be effective and, at the Closing
Date (i) no stop order suspending the effectiveness thereof shall have been
issued and no proceedings for that purpose shall have been initiated or, to
the knowledge of the Company or the Representatives, threatened by the
Commission, and any request for additional information on the part of the
Commission (to be included in the Registra tion Statement or the Prospectus
or otherwise) shall have been complied with to the reasonable satisfaction
of the Representatives, and (ii) there shall not have come to the attention
of the Representatives any facts that would cause them to believe that the
Prospectus, at the time it was required to be delivered to a purchaser of
the Securities, contained any untrue statement of a material fact or
omitted to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading. If the Company has elected to rely upon Rule 430A of
the Rules and Regulations, the price of the Securities and any price
related information previously omitted from the Registration Statement
pursuant to Rule 430A shall have been transmitted to the Commission for
filing pursuant to Rule 424(b) of the Rules and Regulations within the
prescribed time period, and before the Closing Date the Company shall have
provided evidence satisfactory to the Representatives of such timely
filing, or a post-effective amendment providing such information shall have
been promptly filed and declared effective in accordance with the
requirements of Rule 430A of the Rules and Regulations.
(b) At the date of this Agreement, the Representatives shall have
received from Ernst & Young LLP a letter, dated the date of this Agreement,
in form and substance previously approved by the Representatives, together
with signed or reproduced copies of such letter for each of the
Underwriters, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to
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underwriters with respect to the financial statements and certain financial
information contained in the Registration Statement and the Prospectus
(including, without limitation, as to any pro forma financial statements
and as to all historical financial statements of the Company, PPA, RHR,
FLA, LLA and TCRW).
(c) The Representatives shall have received from Ernst & Young LLP a
letter dated the Closing Date to the effect that they reaffirm the
statements made in the letter furnished pursuant to Section 7(b) above,
except that the specified date referred to therein shall be a date not more
than three business days prior to the Closing Date.
(d) The Representatives shall have received from Farella Braun &
Martel LLP, counsel for the Company, a favorable opinion dated the Closing
Date, in form and substance satisfactory to the Representatives, to the
effect that:
(i) To the best of such counsel's knowledge and information,
the Company and its subsidiaries are operating in compliance with all
material franchises, grants, authorizations, licenses, permits,
easements, consents, certificates and orders required for the conduct
of their respective businesses, all of which are valid and in full
force and effect.
(ii) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in the State of Arizona, the
State of California, the State of Colorado, the State of Nevada, the
State of New Mexico, the State of Oregon, the State of Washington and
the State of Utah; the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each other
jurisdiction in which such qualification is required, except where the
failure to be so qualified or in good standing would not have a
material adverse effect on the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise.
(iii) Each Covered Subsidiary (as hereinafter defined) has been
duly organized and is validly existing and in good standing under the
laws of the jurisdiction of its organization and has power and
authority as a corporation, limited partnership or limited liability
company, as the case may be, to own, lease and operate its properties
and to conduct its business as described in the Registration Statement
and the Prospectus; each Covered Subsidiary of the Company is duly
qualified to transact business and is in good standing in each
jurisdiction in which such qualification is required, except where the
failure to be so qualified or in good standing would not have a
material adverse effect on the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise; and (A) all of the
issued and outstanding shares of capital stock of each Covered
Subsidiary that is a corporation have been duly authorized and validly
issued, are fully paid and non-assessable and, to the best knowledge
of such counsel and except as otherwise set forth on Schedule C, are
and, at all
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times since the date on which such subsidiary was organized, have been
owned by the Company, directly or through wholly-owned subsidiaries,
free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity, and (B) all of the issued and
outstanding limited liability company interests of each Covered
Subsidiary that is a limited liability company have been duly
authorized and validly issued (under applicable law and the limited
liability company agreement of such Covered Subsidiary), are fully
paid and non-assessable and, to the best knowledge of such counsel and
except as set forth on Schedule C, are owned by the Company, directly
or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity, and (C) all of
the issued and outstanding partnership interests of each Covered
Subsidiary that is a partnership have been duly authorized (if
applicable) and validly issued and, to the best knowledge of such
counsel and except as set forth on Schedule C, are owned by the
Company, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or
equity. As used herein, the term "Covered Subsidiary" means each
corporation, limited partnership, limited liability company and other
entity listed under Item A of Schedule C, other than those entities
designated on Schedule C as an "Excluded Subsidiary."
(iv) The authorized, issued and outstanding shares of capital
stock of the Company at September 30, 1997 are as set forth in the
Prospectus under "Capitalization".
(v) The execution, delivery and performance of this Agreement,
the Indenture and the Securities, the consummation of the transactions
herein and therein contemplated (including, without limitation, the
incurrence of the indebtedness evidenced by the Securities), and
compliance by the Company with its obligations hereunder and
thereunder, will not result in a breach or violation of any of the
terms or provisions of or constitute a default under (A) any Subject
Agreement, (B) any other material contract, indenture, mortgage, deed
of trust, note, loan agreement or other agreement or instrument known
to such counsel to which the Company or any subsidiary is a party or
by which the Company or any subsidiary is bound or to which any of
their respective properties or assets are subject, (C) the
Organizational Documents of the Covered Subsidiaries, or (D) to the
best of such counsel's knowledge and information, any law, order, rule
or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of
their respective properties (provided that such counsel need express
no opinion as to state securities or real estate syndication laws of
the various jurisdictions where the Securities are to be offered).
(vi) Assuming that the net proceeds from the issuance of the
Securities are used solely to repay indebtedness under the Credit
Agreement, neither the Securities nor any proceeds therefrom will
constitute Funding Debt or a Managing Member Loan.
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(vii) The Registration Statement is effective under the 1933 Act
and, to the best of such counsel's knowledge and information, no stop
order sus pending the effectiveness of the Registration Statement has
been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission.
(viii) At the time the Registration Statement became effective
and at the date of this Agreement, the Registration Statement (other
than the financial statements and supporting schedules and other
financial and statistical data included or incorporated by reference
therein or omitted therefrom and any trustee's Statement of
Eligibility on Form T-1 (a "Form T-1"), as to which no opinion need be
rendered) complied as to form in all material respects with the
requirements of the 1933 Act and the Rules and Regulations; and
nothing has come to such counsel's attention that would lead them to
believe that the Registration Statement, at the time it became
effective and at the date of this Agreement, 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 or that the Prospectus, at the date of the
Prospectus Supplement or at the date of such opinion, included or
includes an untrue statement of a material fact or omitted or omits to
state a material fact necessary in order to make the statements
therein, in the light of the circum stances under which they were
made, not misleading (except that no statement need be made as to
financial statements or supporting schedules or other financial or
statistical data included or incorporated by reference in or omitted
from the Registration Statement or the Prospectus or any Form T-1).
(ix) The documents incorporated or deemed to be incorporated by
reference in the Prospectus (other than the financial statements and
supporting schedules and other financial and statistical data included
or incorporated by reference therein or omitted therefrom, as to which
no opinion need be rendered), as of the dates they were filed with the
Commission (or, if such incorporated documents were amended, when such
amendment was filed), complied as to form in all material respects
with the requirements of the 1934 Act and the published rules and
regulations thereunder.
(x) No filing with, or consent, approval, authorization,
license, registration, qualification, decree or order of, any court or
governmental authority or agency is required in connection with the
execution, delivery or performance of this Agreement, the Indenture or
the Securities by the Company, or in connection with the issuance or
sale of the Securities to be issued and sold by the Company to the
Underwriters, except such as has been obtained under the 1933 Act, the
Rules and Regulations, the 1939 Act or the 1939 Act Regulations or
such as may be required under state securities laws or real estate
syndication laws (provided that such counsel need express no opinion
as to filings with, or consents, approvals, authorizations, licenses,
registrations, qualifications, decrees or orders of, any foreign court
or foreign governmental authority or agency).
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(xi) The Company is not required to be registered under the
Investment Company Act of 1940, as amended.
(xii) The Company is eligible to use a Form S-3 registration
statement under the 1933 Act and is also eligible to use a Form S-3
registration statement pursuant to the standards for that Form as in
effect immediately prior to October 21, 1992.
(xiii) The Company has all legal right, power and authority
necessary to qualify as a "real estate investment trust" under the
Code; the Company was reorganized in Delaware in 1987 and
reincorporated in Maryland in 1996; the Company has elected to be
treated as a "real estate investment trust" since its original
organization; the Company has qualified as a "real estate investment
trust" for its fiscal years ended July 31, 1995, its short taxable
year ended December 31, 1995 and its taxable year ended December 31,
1996 (the years, to the best knowledge of counsel, that are still
subject to audit by the Internal Revenue Service); it is anticipated
that the Company will qualify to be taxed as a "real estate investment
trust" under the Code for its taxable year ended December 31, 1997;
and the Company was and is organized and was operated and is operating
in a manner that enabled and will enable it to qualify to be taxed as
a "real estate investment trust" under the Code for its taxable year
ended December 31, 1997 and its taxable years ending December 31, 1998
and thereafter provided the Company met (in the case of its taxable
year ended December 31, 1997) and continues to meet (in the case of
its taxable years ending December 31, 1998 and thereafter), through
actual annual operating results, distribution levels and diversity of
stock ownership, the various qualification tests imposed by the Code
necessary for the Company to qualify as a "real estate investment
trust". As used in this paragraph (xiii) and paragraph (xiv) below,
the term "Company" includes BankAmerica Realty Investors, a California
business trust and BRE Properties, Inc., a Delaware corporation, which
are both predecessors to BRE Properties, Inc., a Maryland corporation.
(xiv) Each entity listed on Schedule C either qualifies as a
partnership for federal income tax purposes and for California or
Delaware, as the case may be, income tax purposes or as a "qualified
REIT subsidiary" within the meaning of Section 856(i) of the Code or
qualifies to be disregarded as an entity separate from the Company or
one of its subsidiaries for federal income tax purposes and for
California or Delaware, as the case may be, income tax purposes.
(xv) The information in the Prospectus under the captions "The
Operating Company", "Description of Notes", "Risk Factors--Real Estate
Investment Risks--Restrictions in the Operations of the Operating
Company", "Risk Factors--Real Estate Investment Risks--Limited
Indemnification" (only with respect to the first, second and third
paragraphs under such caption),
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"Description of Debt Securities" and "Federal Income Tax
Considerations", and the information in the Company's 1996 Annual
Report on Form 10-K under the caption "Legal Proceedings", to the
extent that it constitutes matters of law or legal conclusions, or
summaries of provisions of the Company's charter or by-laws, the
Subject Agreements, the Indenture, the Securities or of other
documents, agreements or instruments, has been reviewed by such
counsel and is correct in all material respects; and the opinion of
such counsel in the Prospectus under the caption "Federal Income Tax
Considerations" is confirmed.
(xvi) There are no legal or governmental proceedings pending
or, to the best of such counsel's knowledge and information,
threatened against the Company or any of its subsidiaries which are
required to be disclosed in the Registration Statement, other than
those disclosed therein, and all pending legal or governmental
proceedings to which the Company or any of its subsidiaries is a party
or of which any of the property of the Company or any of its subsidi
aries is the subject which are not described in the Registration
Statement, including ordinary routine litigation incidental to the
business, are, considered in the aggregate, not material.
(xvii) To the best of such counsel's knowledge and information,
there are no contracts, indentures, mortgages, loan agreements, notes,
leases or other instruments required to be described or referred to in
the Registration Statement or in the documents incorporated by
reference therein or to be filed as exhibits thereto other than those
described or referred to therein or filed or incorporated by reference
as exhibits thereto, the descriptions thereof and references thereto
are correct in all material respects, and, to the best of such
counsel's knowledge and information, no default exists in the due
performance or observance of any obligation, agreement, covenant or
condition contained in any material contract, indenture, mortgage,
loan agreement, note, lease or other instrument so described, referred
to or filed.
(xviii) The Indenture has been qualified under the 1939 Act.
Such opinion shall be rendered to the Underwriters at the request of the
Company and shall so state therein. In giving their opinion, Farella Braun &
Martel LLP (A) shall state that insofar as such opinion concerns the Indenture,
the Securities or any other instrument, agreement or other document which by its
terms is not governed by the laws of the State of California, the General
Corporation Law of the State of Delaware or the Limited Liability Company Act of
the State of Delaware, such counsel has assumed that the Indenture, the
Securities and such other instruments, agreements and other documents are
governed by the laws of the State of California and (B) may rely (i) as to the
qualification of the Company and its subsidiaries to do business in any state or
jurisdiction, upon certificates of appropriate government officials and (ii) as
to matters of fact, upon certificates and written statements of officers of and
accountants for the Company and (C) shall state that such counsel has relied,
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as to matters arising under the laws of the State of Maryland and the State of
New York, upon the opinion of Piper & Marbury l.l.p. delivered pursuant to
Section 7(e) hereof.
(e) The Representatives have received from Piper & Marbury l.l.p.,
Maryland and New York counsel for the Company, a favorable opinion dated
the Closing Date, in form and substance satisfactory to the
Representatives, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Maryland.
(ii) The Company has the corporate power and authority to own,
lease and operate its properties and conduct its business as described
in the Registration Statement and the Prospectus.
(iii) The authorized, issued and outstanding shares of capital
stock of the Company are as set forth in the Prospectus under
"Capitalization" (except for subsequent issuances, if any, of Common
Stock pursuant to the employee benefit, employee and director stock
option and dividend reinvestment plans referred to in the Prospectus);
and the shares of issued and outstanding Common Stock have been duly
authorized and validly issued, are fully-paid and non-assessable, and
are not subject to any preemptive or other similar rights arising by
operation of law, under the charter or by-laws of the Company, under
any resolution adopted by the board of directors of the Company or any
committee thereof or, to the best of such counsel's knowledge,
otherwise.
(iv) The Indenture has been duly authorized, executed and
delivered by the Company and (assuming the due authorization,
execution and delivery thereof by the Trustee) constitutes a valid and
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting creditors' rights generally or
by general equitable principles.
(v) The Securities have been duly authorized and executed by
the Company and, when duly authenticated by the Trustee in the manner
provided in the Indenture (assuming the due authorization, execution
and delivery of the Indenture by the Trustee) and delivered against
payment of the purchase price therefor pursuant to this Agreement,
will constitute valid and binding obliga tions of the Company,
enforceable against the Company in accordance with their terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting creditor's rights generally or by general equitable
principles, and will be entitled to the benefits of the Indenture.
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(vi) This Agreement has been duly authorized, executed and
delivered by the Company; and the execution, delivery and performance
of this Agree ment, the Indenture and the Securities, the consummation
of the transactions herein and therein contemplated, and compliance by
the Company with its obligations hereunder and thereunder, will not
result in a breach or violation of any of the terms or provisions of
or constitute a default under the Company's charter or by-laws or, to
the best of such counsel's knowledge, any law, order, rule or
regulation of any Maryland or New York court, governmental agency or
body having jurisdiction over the Company or any of its subsidiaries
or any of their respective properties.
(vii) No filing with, or consent, approval, authorization or
order of, any Maryland or New York court, governmental authority or
agency is required in connection with the execution, delivery or
performance of this Agreement, the Indenture or the Securities by the
Company, or in connection with the issuance or sale of the Securities
to the Underwriters, except such as may be required under Maryland or
New York securities laws or real estate syndication laws.
(viii) The information in the Prospectus under the captions
"Description of Notes", "Description of Debt Securities" and "Risk
Factors--Provisions Which Could Limit a Change in Control or Deter a
Takeover", and the infor mation in the Company's 1996 Annual Report on
Form 10-K under the caption "Risk Factors--Provisions Which Could
Limit a Change in Control or Deter a Takeover", to the extent that it
constitutes matters of Maryland or New York law or legal conclusions
under Maryland or New York law, or summaries of provisions of the
Company's charter or by-laws, the Indenture, the Securities or of any
other documents specifically referred to therein (excluding two loan
agreements specifically referred to under the caption "Description of
Notes" in the Prospectus) is correct in all material respects.
(ix) The issuance, sale and public offering of the Securities
have been approved by the "Continuing Directors" and do not constitute
a "Business Combination" (as such terms are defined in Article VIII of
the Company's charter).
Such opinion shall be rendered to the Underwriters at the request of
the Company and shall so state therein. In giving their opinion, Piper &
Marbury l.l.p. (i) may rely as to matters of fact, to the extent not
independently verified by such counsel, upon certificates and written
statements of officers and accountants for the Company, (ii) shall state
that such opinion is limited to matters arising under the laws of the State
of Maryland, the State of New York and the General Corporation Law of the
State of Delaware and that, insofar as such opinion concerns any
instrument, agreement or other document which by its terms is not governed
by the laws of the State of Maryland, the State of New York or the General
Corporation Law of the State of Delaware, such counsel has assumed that
such instruments, agreements and other documents are governed by the laws
of the State of Maryland and (iii) shall expressly
27
<PAGE>
state that Farella Braun & Martel LLP and Brown & Wood LLP, in rendering
their opinions pursuant to Sections 7(d) and 7(f) of this Agreement, may
rely on such opinion as to all matters arising under the laws of the State
of Maryland and, solely with respect to Farella Braun & Martel LLP, the
State of New York, as if such opinion were addressed to them.
(f) The Representatives shall have received from Brown & Wood LLP,
counsel for the Underwriters, their favorable opinion or opinions dated the
Closing Date with respect to the organization of the Company, the validity
of the Securities to be sold by the Company, this Agreement, the Indenture,
the Registration Statement, the Prospectus and such other related matters
as the Representatives may require, and the Company shall have furnished to
such counsel such documents as they may request for the purpose of enabling
them to pass upon such matters.
(g) At the date of this Agreement and at the Closing Date, the
Securities shall be rated at least Baa2 by Moody's Investor's Service Inc.,
BBB by Standard & Poor's Corporation, and the Company shall have delivered
to the Representatives a letter, dated the Closing Date, from each such
rating agency, or other evidence satisfactory to the Representatives,
confirming that the Securities have such ratings.
(h) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date (1) there shall not have occurred any
downgrading, nor shall any notice have been given of any intended or
potential downgrading or of any review for a possible change that does not
indicate the direction of the possible change, in the rating accorded the
Securities or any of the Company's other securities by any "nationally
recognized statistical rating organization," as such term is defined for
purposes of Rule 436(g)(2) under the 1933 Act; and (2) there shall not have
occurred any change, or any development involving a prospective change, in
the condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from that
set forth in the Prospectus (exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement) that, in your judgment,
is material and adverse and that makes it, in your judgment, imprac ticable
to market the Securities on the terms and in the manner contemplated in the
Prospectus. At the Closing Date (i) the Registration Statement and the
Prospectus shall contain all statements which are required to be stated
therein in accordance with the 1933 Act and the Rules and Regulations and
in all material respects shall conform to the requirements of the 1933 Act
and the Rules and Regulations, and neither the Registration Statement nor
the Prospectus shall contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary
to make the statements therein not misleading and no action, suit or
proceeding at law or in equity shall be pending or, to the knowledge of the
Company, threatened against the Company or any of its subsidiaries which
would be required to be set forth in the Registration Statement or the
Prospectus other than as set forth therein, (ii) no proceeding shall be
pending or, to the knowledge of the Company, threatened against the Company
or any of its subsidiaries before or by any Federal, state or other court,
commission, board or administrative agency wherein an unfavora-
28
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ble decision, ruling or finding would materially and adversely affect the
business, property, financial condition or income of the Company and its
subsidiaries considered as one enterprise other than as set forth in the
Registration Statement and the Prospectus, (iii) neither the Company nor
any of its subsidiaries shall be in default in the performance or
observance of any contract to which it is a party, except such defaults
that would not have a material adverse effect on the condition, financial
or otherwise, of the Company and its subsidiaries considered as one
enterprise or the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, (iv) no stop
order suspending the effectiveness of the Registration Statement shall have
been issued under the 1933 Act and no proceeding therefor shall have been
instituted or threatened by the Commission and (v) the Repre sentatives
shall have received, at the Closing Date, a certificate of the President
and the Chief Financial Officer of the Company, dated as of the Closing
Date, evidencing compliance with the appropriate provisions of this
subsection (h).
(i) The Representatives shall have received a certificate, dated the
Closing Date, of the President and the Chief Financial Officer of the
Company to the effect that the representations and warranties of the
Company contained in Section 2(a) are true and correct with the same force
and effect as though expressly made at and as of the Closing Date.
(j) The Company shall have furnished to the Representatives, prior to
the date of this Agreement, a copy of the Written Consent and the Written
Consent shall be in full force and effect on the Closing Date with the same
force and effect as though expressly given by the Lender at and as of the
Closing Date.
(k) The Company shall have furnished to the Representatives such
additional certificates as the Representatives may have reasonably
requested as to the accuracy, at and as of the Closing Date, of the
representations and warranties made herein by the Company, as to compliance
at and as of the Closing Date by the Company with its covenants and
agreements herein contained and other provisions hereof to be satisfied at
or prior to the Closing Date and as to other conditions to the obligations
of the Underwriters hereunder.
If any of the conditions hereinabove provided for in this Section shall not
have been satisfied when and as required by this Agreement, this Agreement may
be terminated by the Representatives by notifying the Company of such
termination in writing or by telegram or telecopy at or prior to the Closing
Date.
8. Termination. This Agreement may be terminated by the Representatives
-----------
by notice to the Company at or prior to the Closing Date if (a) after the
execution and delivery of this Agreement and prior to the Closing Date (i)
trading generally shall have been suspended or materially limited on or by, as
the case may be, any of the New York Stock Exchange, the American Stock
Exchange, the National Association of Securities Dealers, Inc., the Chicago
Board of Options Exchange, the Chicago Mercantile Exchange or the Chicago Board
of Trade, (ii) trading of any securities of the Company shall have been
suspended on
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any exchange or in any over-the-counter market, (iii) a general moratorium on
commercial banking activates in New York or California shall have been declared
by either Federal, New York State or California State authorities or (iv) there
shall have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in your judgment, is material
and adverse and (b) in the case of any of the events specified in clauses (a)(i)
through (iv), such event, singly or together with any other such event, makes
it, in your judgment, impracticable to market the Securities on the terms and in
the manner contemplated in the Prospectus.
9. Reimbursement of Underwriters. Notwithstanding any other provisions
-----------------------------
hereof, if this Agreement shall be terminated by the Underwriters or shall
otherwise terminate under Section 7, Section 8 or Section 11, the Company will
bear and pay the expenses specified in Section 5 hereof and, in addition to its
obligations pursuant to Section 6 hereof, the Company will reimburse the
reasonable out-of-pocket expenses of the several Underwriters (including
reasonable fees and disbursements of counsel for the Underwriters) incurred in
connection with this Agreement and the proposed purchase and offers of the
Securities, and promptly upon demand the Company will pay such amounts to you,
as Representatives of the Underwriters. In addition, the provisions of Section
6 hereof will survive any termination of this Agreement.
10. Default by Underwriters. If any Underwriter or Underwriters shall
-----------------------
default in its or their obligations to purchase any of the Securities which it
or they are obligated to purchase under this Agreement on the Closing Date, and
the aggregate principal amount of Securities which such defaulting Underwriter
or Underwriters agreed but failed to purchase does not exceed 10% of the
aggregate principal amount of all of the Securities which the Underwriters are
obligated to purchase on the Closing Date, the other Underwriters shall be
obligated severally, in proportion to their respective commitments hereunder, to
purchase the Securities which such defaulting Underwriter or Underwriters agreed
but failed to purchase. If any Underwriter or Underwriters shall so default and
the aggregate principal amount of Securities with respect to which such default
or defaults occur is more than 10% of the aggregate principal amount of all of
the Securities which the Underwriters are obligated to purchase on the Closing
Date and arrangements satisfactory to the Representatives and the Company for
the purchase of such Securities by other persons are not made within 48 hours
after such default, this Agreement shall terminate.
If the remaining Underwriters or substituted underwriters are required
hereby or agree to take up all or part of the Securities of a defaulting
Underwriter or Underwriters as provided, in this Section 10, (i) the Company
shall have the right to postpone the Closing Date for a period of not more than
five full business days, in order that the Company may effect whatever changes
may thereby be made necessary in the Registration Statement or the Prospectus,
or in any other documents or arrangements, and the Company agrees promptly to
file any amendments to the Registration Statement or supplements to the
Prospectus which may thereby be made necessary, and (ii) the respective
principal amounts of Securities to be purchased by the remaining Underwriters or
substituted underwriters shall be taken as the basis of their underwriting
obligation for all purposes of this Agreement. Nothing herein contained shall
relieve any defaulting Underwriter of its liability to the Company or the
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Underwriters for damages occasioned by its default hereunder. Any termination
of this Agreement pursuant to this Section 10 shall be without liability on the
part of any non-defaulting Underwriter or the Company, except for expenses to be
paid or reimbursed pursuant to Section 5 and except for the provisions of
Section 6.
11. Default by the Company. If the Company shall fail at the Closing Date
----------------------
to sell and deliver the total principal amount of Securities which it is
obligated to sell hereunder, then this Agreement shall terminate without any
liability on the part of any non-defaulting party. No action taken pursuant to
this Section shall relieve the Company from liability in respect of such
default.
12. Notices. All communications hereunder shall be in writing and, if
-------
sent to the Underwriters shall be mailed, delivered or telecopied and confirmed
to you, as their Representatives c/o Morgan Stanley & Co. Incorporated at 1585
Broadway, New York, New York 10036, attention: Debt Syndicate Desk, except that
notices given to an Underwriter pursuant to Section 6 hereof shall be sent to
such Underwriter at the address furnished by the Representatives or, if sent to
the Company shall be mailed, delivered or telecopied and confirmed at BRE
Properties, Inc., 44 Montgomery Street, Suite 3600, San Francisco, California
94104-4602, attention: LeRoy E. Carlson.
13. Successors. This Agreement shall inure to the benefit of and be
----------
binding upon the several Underwriters, the Company and their respective
successors and legal representa tives. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person other than the
persons mentioned in the preceding sentence any legal or equitable right, remedy
or claim under or in respect of this Agreement, or any provisions herein
contained, this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person; except that the representations, warranties,
covenants, agreements and indemnities of the Company contained in this Agreement
shall also be for the benefit of the person or persons, if any, who control any
Underwriter or Underwriters within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, and the indemnities of the several Underwriters
shall also be for the benefit of each director of the Company, each of the
Company's officers who has signed the Registration Statement and the person or
persons, if any, who control the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act.
14. Applicable Law. This Agreement shall be governed by and construed in
--------------
accordance with the laws of the State of New York applicable to agreements made
and to be performed in said state. Unless otherwise expressly stated, specified
times of day refer to New York City time.
31
<PAGE>
If the foregoing correctly sets forth our understanding, please indicate
your acceptance thereof in the space provided below for that purpose, whereupon
this letter and your acceptance shall constitute a binding agreement between us.
Very truly yours,
BRE PROPERTIES, INC.
By: /s/ FRANK C. McDOWELL
----------------------------
Name: Frank C. McDowell
Title: President and Chief
Executive Officer
Accepted and delivered, as of the date first above
written:
MORGAN STANLEY & CO. INCORPORATED
BANCAMERICA ROBERTSON STEPHENS
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
SALOMON BROTHERS INC
Acting on their own behalf and as Representatives
of the several Underwriters referred to in the
foregoing Agreement.
BY: MORGAN STANLEY & CO. INCORPORATED
By: /s/ GARY PALMER
--------------------------------------
Name: Gary Palmer
Title: Principal
32
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
Aggregate
Principal
Amount of
Securities
to be
Purchased
------------
<S> <C>
Morgan Stanley & Co. Incorporated....... 32,500,000
BancAmerica Robertson Stephens.......... 32,500,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated......................... 32,500,000
Salomon Brothers Inc.................... 32,500,000
------------
Total.......................... $130,000,000
============
</TABLE>
Sch. A-1
<PAGE>
SCHEDULE B
1. The initial public offering price for the Securities shall be 99.950%
of the principal amount thereof (the "Public Offering Price"), plus accrued
interest from February 15, 1998.
2. The purchase price for the Securities to be purchased by the several
Underwriters shall be 99.200% of the principal amount thereof, plus accrued
interest from February 15, 1998.
Sch. B-1
<PAGE>
SCHEDULE C
<TABLE>
<CAPTION>
A. Subsidiaries of the Company Company's
--------------------------- Percentage
Ownership
Interest
-----------
<S> <C>
1. Corporate Subsidiaries of the Corporation
-----------------------------------------
BRE Camino Seco, Inc., a Delaware corporation 100%
BRE Colonia Del Rio, Inc., a Delaware corporation 100%
BRE Fountain Plaza, Inc., a Delaware corporation 100%
BRE Hacienda Del Rio, Inc., a Delaware corporation 100%
BRE Oracle Village, Inc., a Delaware corporation 100%
BRE Springhill, Inc., a Delaware corporation 100%
Alliance Property Management Company, a Delaware corporation 100%
BRE Builders, Inc., a Delaware corporation 100%
2. Partnerships Subsidiaries of the Company:
----------------------------------------
Vallejo Highlands Associates, a California limited partnership 100%
Vallejo Somerset Limited Partnership, a Texas limited partnership/*/ 100%
ITCR Villa Verde Limited Partnership, a Texas limited partnership/*/ 100%
3. Limited Liability Company Subsidiaries of the Company:
-----------------------------------------------------
BRE Property Investors LLC, a Delaware limited liability company 70%
Blue Ravine Investors LLC, a Delaware limited liability company 88.45%
Palm Shadows LLC, a California limited liability company 100%
Riverview LLC, a California limited liability company 100%
Woodlake Holdings LLC, an Arizona limited liability company* 100%
B. Non-Subsidiary Entities in Which the Company Owns an Interest
-------------------------------------------------------------
Westbar Limited Partnership, an Arizona limited partnership 25%
Metro Village Limited Partnership, an Arizona limited partnership 37.5%
</TABLE>
__________________________
* Excluded Subsidiary
Sch. C-1
<PAGE>
EXHIBIT 4.2
<PAGE>
[LEGEND FOR INCLUSION IN GLOBAL NOTES--THIS NOTE IS A GLOBAL NOTE WITHIN THE
MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME
OF A DEPOSITARY OR A NOMINEE THEREOF. THIS NOTE IS EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND UNTIL IT
IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT
BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.]
[LEGEND FOR INCLUSION IN GLOBAL NOTES--UNLESS THIS NOTE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE COMPANY (AS DEFINED BELOW) OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED
IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
No.:
CUSIP No.: Principal Amount: $___________
BRE PROPERTIES, INC.
7 1/8% Notes due 2013
BRE Properties, Inc., a Maryland corporation (hereinafter called the
"Company", which term includes any successor corporation under the Indenture
referred to below), for value received, hereby promises to pay to ___________,
or registered assigns, the principal sum of ___________ DOLLARS ($__________) on
February 15, 2013 (the "Maturity Date"), and to pay interest thereon from
February 15, 1998 or from the most recent date to which interest has been paid
or duly provided for, semiannually on February 15 and August 15 of each year
(each, an "Interest Payment Date"), commencing August 15, 1998, and at Maturity
and any earlier Redemption Date (as defined herein), at the rate of 7 1/8% per
annum, until the principal hereof is paid or duly made available for payment.
Interest on this Note shall be calculated on the basis of a 360-day year
consisting of twelve 30-day months. The interest so payable and punctually paid
or duly provided for on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Note (or one or more
Predecessor Debt Securities) is registered at the close of business on the
Regular Record Date for such interest, which shall be the February 1 or August 1
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date shall
forthwith cease to be payable to the registered Holder hereof on the relevant
Regular Record Date by virtue of having been such Holder, and may be paid to the
Person in whose name this Note (or one or more Predecessor Debt Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to the Holder of this Note not less than 10 days prior to such Special
Record Date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which
<PAGE>
the Notes may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in such Indenture.
Payment of the principal of, premium, if any, and interest on this
Note will be made at the office or agency of the Company maintained for that
purpose in the Borough of Manhattan, The City of New York, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided, however, that, at the
option of the Company, interest may be paid by check mailed to the address of
the Person entitled thereto as such address shall appear in the Security
Register or by transfer to an account maintained by the payee located in the
United States.
This Note is one of a duly authorized issue of Debt Securities of the
Company (herein called the "Notes") issued and to be issued in one or more
series under an Indenture dated as of June 23, 1997 (herein called, together
with all indentures supplemental thereto, the "Indenture") between the Company
and Chase Manhattan Bank and Trust Company, National Association, as successor
trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Notes, and the terms upon which the Notes are, and are to be,
authenticated and delivered. This Note is one of the series designated on the
face hereof, limited (subject to exceptions provided in the Indenture) in
aggregate principal amount to $__________.
The Notes are redeemable, in whole or from time to time in part, at
the option of the Company on any date (a "Redemption Date"), at a redemption
price equal to the greater of (i) 100% of the principal amount of the Notes to
be redeemed and (ii) the sum of the present values of the remaining scheduled
payments of principal and interest thereon (exclusive of interest accrued to
such Redemption Date) discounted to such Redemption Date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate (as defined below) plus 25 basis points, plus, in either case, accrued and
unpaid interest on the principal amount being redeemed to such Redemption Date;
provided that installments of interest on Notes whose Stated Maturity is on or
prior to the relevant Redemption Date shall be payable to the Holders of such
Notes, or one or more Predecessor Debt Securities, registered as such at the
close of business on the relevant Regular Record Date according to their terms
and the provisions of the Indenture. Notice of redemption shall be given in the
manner provided in the Indenture, not less than 30 days nor more than 60 days
prior to the relevant Redemption Date, to each Holder of Notes to be redeemed.
Any redemption of Notes shall be made in accordance with the further terms and
provisions set forth in the Indenture.
As used herein, the following terms will have the meanings set forth
below:
"Treasury Rate" means, with respect to any Redemption Date for the
Notes, (i) the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published statistical
release designated "H.15(519)" or any successor publication which is published
weekly by the Board of Governors of the Federal Reserve System and which
establishes yields on actively traded United States Treasury securities adjusted
to constant maturity under the caption "Treasury Constant Maturities," for the
maturity corresponding to the Comparable Treasury Issue (if no maturity is
within three months before or after the Maturity Date, yields for the two
published maturities most closely corresponding to the Comparable Treasury Issue
shall be determined and the Treasury Rate shall be interpolated or extrapolated
from such yields on a straight line basis, rounding to the nearest month) or
(ii) if such release (or any successor release) is not published during the week
preceding the calculation date or does not contain such yields, the rate per
annum equal to the semi-annual equivalent yield to maturity of the Comparable
Treasury Issue, calculated using a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date. The Treasury Rate shall be calculated
on the third Business Day preceding the Redemption Date.
<PAGE>
"Comparable Treasury Issue" means the United States Treasury security
selected by the Independent Investment Banker as having a maturity comparable to
the remaining term of the Notes to be redeemed that would be utilized, at the
time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of the Notes.
"Independent Investment Banker" means Morgan Stanley & Co.
Incorporated or, if such firm is unwilling or unable to select the Comparable
Treasury Issue, an independent investment banking institution of national
standing appointed by the Trustee after consultation with the Company.
"Comparable Treasury Price" means with respect to any Redemption Date
for the Notes (i) the average of four Reference Treasury Dealer Quotations for
such Redemption Date, after excluding the highest and lowest such Reference
Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer than four such
Reference Treasury Dealer Quotations, the average of all such quotations.
"Reference Treasury Dealer" means each of Morgan Stanley & Co.
Incorporated, BancAmerica Robertson Stephens, Merrill Lynch, Pierce, Fenner &
Smith Incorporated and Salomon Brothers Inc and their respective successors;
provided, however, that if any of the foregoing shall cease to be a primary U.S.
Government securities dealer in New York City (a "Primary Treasury Dealer"), the
Company will substitute therefor another Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any Redemption Date, the average, as determined by
the Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York
City time, on the third Business Day preceding such Redemption Date.
If an Event of Default with respect to the Notes shall occur and be
continuing, the principal of the Notes may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Debt Securities of each series
issued under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of not less than a majority in aggregate principal amount
of the Debt Securities at the time Outstanding of each series affected thereby.
The Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Debt Securities of any series
at the time Outstanding, on behalf of the Holders of all Debt Securities of such
series, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Holder of this Note shall be conclusive and
binding upon such Holder and upon all future Holders of this Note and of any
Notes issued upon the registration of transfer hereof or in exchange herefor or
in lieu hereof, whether or not notation of such consent or waiver is made upon
this Note.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, premium, if any, and
interest on this Note, at the time, place and rate, and in the coin or currency,
herein and in the Indenture prescribed.
As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Note may be registered on the Security
Register upon surrender of this Note for registration of transfer at the office
or agency of the Company maintained for the purpose in any place where the
principal of, premium, if any, and interest on this Note are payable, duly
endorsed, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed by the
Holder hereof or by his attorney duly authorized in writing, and thereupon one
or more new Notes, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
<PAGE>
The Notes are issuable only in registered form without coupons in the
denominations of $1,000 and integral multiples of $1,000. As provided in the
Indenture and subject to certain limitations set forth therein, the Notes are
exchangeable for a like aggregate principal amount of Notes of authorized
denominations as requested by the Holders surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith, other than
in certain cases provided in the Indenture.
Prior to due presentment of this Note for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Indenture contains provisions whereby (i) the Company may be
discharged from its obligations with respect to the Notes (subject to certain
exceptions) or (ii) the Company may be released from its obligations under
specified covenants and agreements in the Indenture, in each case if the Company
irrevocably deposits with the Trustee money or Government Obligations sufficient
to pay and discharge the entire indebtedness on all Notes, and satisfies certain
other conditions, all as more fully provided in the Indenture.
This Note shall be governed by and construed in accordance with the
laws of the State of New York.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
Unless the certificate of authentication hereon has been executed by
or on behalf of the Trustee under the Indenture by the manual signature of one
of its authorized signatories, this Note shall not be entitled to any benefits
under the Indenture or be valid or obligatory for any purpose.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
[Seal] BRE PROPERTIES, INC.
Attest:___________________________ By: ________________________________
LeRoy E. Carlson Frank C. McDowell
Executive Vice President, President and
Chief Financial Officer and Chief Executive Officer
Secretary
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the
series designated therein referred to in
the within-mentioned Indenture.
CHASE MANHATTAN BANK AND TRUST
COMPANY, NATIONAL ASSOCIATION,
as Trustee
By: ______________________________
Authorized Signatory
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM--as tenants in common UNIF GIFT MIN ACT--______Custodian_______
TEN ENT--as tenants by the entireties (Cust) (Minor)
JT TEN--as joint tenants with right of Under Uniform Gifts to Minors
survivorship and not as tenants in common Act____________________________
(State)
Additional abbreviations may also be used though not in the above list.
______________________________________
FOR VALUE RECEIVED, the undersigned registered holder hereby sell(s), assign(s)
and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
________________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing
_______________________________________________________________________ Attorney
to transfer said Note on the books of the Company with full power of
substitution in the premises.
Dated:__________________________________________________________________________
Notice: The signature(s) to this assignment must correspond with the
name(s) as it/they appear(s) upon the face of the within Note in every
particular, without alteration or enlargement or any change whatever.
