<PAGE>
As filed with the Securities and Exchange Commission on June 11, 1999
Registration Statement No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
_________________________
BOSTON PROPERTIES, INC.
(Exact name of Registrant as specified in its charter)
Delaware 04-2473675
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
800 Boylston Street
Boston, Massachusetts 02199
(617) 236-3300
(Address, including zip code, and telephone number,
including area code of Registrant's principal executive offices)
Mortimer B. Zuckerman, Chairman
Edward H. Linde, President and Chief Executive Officer
BOSTON PROPERTIES, INC.
800 Boylston Street
Boston Massachusetts 02199
(617) 236-3300
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
_____________________________
Copy to:
GILBERT G. MENNA, P.C.
ETTORE A. SANTUCCI, P.C.
Goodwin, Procter & Hoar LLP
Exchange Place
Boston, Massachusetts 02109-2881
(617) 570-1000
_____________________________
Approximate date of commencement of proposed sale to the public: From time to
time after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this form is used to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==============================================================================================================
Proposed Maximum Proposed Maximum
Amount to be Offering Price Per Aggregate Offering Amount of
Title of Shares Being Registered Registered(2) Share(3) Price(3) Registration Fee
<S> <C> <C> <C> <C>
Common Stock, par value $.01
per share(1) 592,916 $35.16 $20,846,927 $5,795.45
===============================================================================================================
</TABLE>
(1) This Registration Statement also relates to the rights to purchase shares of
Series E Junior Participating Cumulative Preferred Stock of the Registrant
which are attached to all shares of Common Stock issued, pursuant to the
terms of the Registrant's Shareholder Rights Agreement dated June 16, 1997.
Until the occurrence of certain prescribed events, the rights are not
exercisable, are evidenced by the certificates for the Common Stock and will
be transferred with and only with such Common Stock. Because no separate
consideration is paid for the rights, the registration fee therefor is
included in the fee for the Common Stock.
(2) Plus such additional number of shares as may be required in the event of a
stock dividend, reverse stock split, split-up recapitalization or other
similar event.
(3) Estimated solely for purposes of determining the registration fee pursuant
to Rule 457(c) based on the average of the high and low sales prices on the
New York Stock Exchange on June 10, 1999.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
<PAGE>
*************************************************************************
* The information in this prospectus is not complete and may be *
* changed. These securities may not be sold until the registration *
* statement filed with the Securities and Exchange Commission is *
* effective. This prospectus is not an offer to sell these securities *
* and it is not soliciting an offer to buy these securities in any *
* state where the offer or sale is not permitted. *
*************************************************************************
Subject to Completion. Dated June 11, 1999.
Prospectus
- ----------
592,916 Shares of Common Stock
Boston Properties, Inc.
------------
The selling stockholders identified in this prospectus, and any of their
pledgees, donees, transferees or other successors in interest, may offer to sell
up to an aggregate of 592,916 shares of common stock of Boston Properties, Inc.
The selling stockholders may only offer the common stock for sale if they
exercise their right to tender their units of Boston Properties Limited
Partnership, our operating partnership, for cash, and we exercise our right to
issue common stock to them instead of cash. We will not receive any of the
proceeds from the sale of the common stock by the selling stockholders, but we
have agreed to bear the expenses of registering such shares.
Our common stock is listed on the New York Stock Exchange under the symbol
"BXP."
--------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, or determined if
this prospectus is truthful or complete. It is illegal for any person to tell
you otherwise.
--------------------
The date of this prospectus is June __, 1999.
<PAGE>
PROSPECTUS SUMMARY
This summary only highlights the more detailed information appearing
elsewhere in this prospectus or incorporated herein by reference. As this is a
summary, it may not contain all information that is important to you. You
should read this entire prospectus carefully before deciding whether to invest
in our common stock.
Unless the context otherwise requires, all references to "we," "us" or "our
company" in this prospectus refer collectively to Boston Properties, Inc., a
Delaware corporation, and its subsidiaries, including Boston Properties Limited
Partnership, a Delaware limited partnership, and their respective predecessor
entities for the applicable periods, considered as a single enterprise.
--------------------
About Boston Properties, Inc.
Boston Properties, Inc. is a real estate investment trust or "REIT." We
are one of the largest owners and developers of office properties in the United
States, with a significant presence in Greater Boston; Midtown Manhattan;
Greater Washington, D.C.; Greater San Francisco; Princeton/East Brunswick, New
Jersey; Richmond, Virginia; and Baltimore, Maryland. We conduct substantially
all our business through Boston Properties Limited Partnership. As of March 31,
1999, we owned 124 properties, aggregating more than 32 million square feet.
Our properties consist of 111 office properties, consisting of 79 Class A office
buildings, including eight under development and 32 properties that support both
office and technical uses, nine industrial properties, three hotels and one
parking garage. We are the sole general partner and the owner of approximately
67.3% of the economic interests in Boston Properties Limited Partnership. Our
principal executive office is located at 800 Boylston Street, Boston,
Massachusetts 02199; telephone number (617) 236-3300. Our common stock is
listed on the New York Stock Exchange under the symbol "BXP."
Additional information regarding Boston Properties, including our audited
financial statements and descriptions of Boston Properties, is contained in the
documents incorporated by reference in this prospectus. See "Where You Can Find
More Information" on page 4.
2
<PAGE>
The Offering
This prospectus relates to up to 592,916 shares of our common stock that
may be offered for sale by the selling stockholders if, and to the extent that,
they tender their common units of Boston Properties Limited Partnership for
cash, and we exercise our right to issue common stock to them instead of cash.
Boston Properties Limited Partnership originally issued these units to the
selling stockholders in connection with our May 28, 1998 acquisition of a parcel
of land in Montgomery County, Maryland, known as Tower Oaks. Each selling
shareholder is a direct or indirect former owner of the Tower Oaks property. In
connection with this acquisition, we entered into a registration rights and
lock-up agreement with the selling stockholders. Under the terms of that
agreement, the selling stockholders could not tender their units for redemption
until after May 29, 1999. We are registering the common stock covered by this
prospectus in order to fulfill our contractual obligations under the
registration rights and lock-up agreement. Registration of the common stock
does not necessarily mean that all or any portion of such stock will be offered
for sale by the selling stockholders.
Pursuant to the Second Amended and Restated Agreement of Limited
Partnership of Boston Properties Limited Partnership, as amended, unitholders
may tender their common units of Boston Properties Limited Partnership for cash
equal to the value of an equivalent number of shares of our common stock. In
lieu of delivering cash, however, we may, at our option, choose to acquire any
units so tendered by issuing common stock in exchange for the units. The common
stock will be exchanged for units on a one-for-one basis. This one-for-one
exchange ratio may be adjusted to prevent dilution.
We have agreed to bear the expenses of the registration of the common stock
under federal and state securities laws, but we will not receive any proceeds
from the sale of any common stock offered under this prospectus.
Tax Status of Boston Properties, Inc
We have elected to qualify as a real estate investment trust under Sections
856 through 860 of the Internal Revenue Code. As long as we qualify for
taxation as a real estate investment trust, we generally will not be subject to
federal income tax on that portion of our ordinary income and capital gains that
is currently distributed to our stockholders. Even if we qualify for taxation
as a real estate investment trust, we may be subject to state and local taxes on
our income and property and to federal income and excise taxes on our
undistributed income.
3
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Securities Exchange
Act of 1934, as amended, and we are required to file reports and proxy
statements and other information with the Securities and Exchange Commission.
You may read and copy these reports, proxy statements and information at the
public reference facilities maintained by the Securities and Exchange Commission
at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549,
and at the Securities and Exchange Commission's Regional Offices at 7 World
Trade Center, 13th Floor, New York, New York 10048, and Citicorp Center, 500 W.
Madison Street, Suite 1400, Chicago, Illinois 60661-2511. You may also obtain
copies at the prescribed rates from the Public Reference Section of the
Securities and Exchange Commission at its principal office in Washington, D.C.
You may call the Securities and Exchange Commission at 1-800-SEC-0330 for
further information about the public reference rooms. The Securities and
Exchange Commission maintains a web site that contains reports, proxy and
information statements and other information regarding registrants, including,
Boston Properties, Inc., that file electronically with the Securities and
Exchange Commission. You may access the Securities and Exchange Commission's web
site at http://www.sec.gov.
INCORPORATION OF DOCUMENTS BY REFERENCE
The Securities and Exchange Commission allows us to incorporate by
reference the information that we file with them. Incorporation by reference
means that we can disclose important information to you by referring you to
other documents that are legally considered to be part of this prospectus
supplement or the attached prospectus, and later information that we file with
the Securities and Exchange Commission will automatically update and supersede
the information in this prospectus, any supplement and the documents listed
below. We incorporate by reference the specific documents listed below and any
future filings made with the Securities and Exchange Commission under Section
13(a), 13(c), 14, or 15(d) of the Securities Exchange Act until we sell all of
the securities:
. our Annual Report on Form 10-K for the year ended December 31, 1998;
. our Proxy Statement dated March 31, 1999 prepared in connection with our
Annual Meeting of Stockholders held on May 5, 1999;
. our Quarterly Report on Form 10-Q for the three months ended March 31,
1999;
. our Current Reports on Form 8-K dated April 27, 1999 and May 25, 1999;
. the description of our common stock contained in our Registration
Statement on Form 8-A, filed on June 12, 1997 and all amendments and
reports updating such description; and
. the description of the rights to purchase shares of our Series E Junior
Participating Cumulative Preferred Stock contained in our registration
statement on Form 8-A, filed on June 12, 1997, and the description
contained in our registration statement on Form 8-A/A filed on June 16,
1997 amending such description, and all amendments and reports updating
that description.
You should rely only on the information incorporated by reference or
provided in this prospectus. We have not authorized anyone to provide you with
different information. You should not assume that the information in this
prospectus or the documents incorporated by reference is accurate as of any date
other than the date on the front of this prospectus or those documents.
4
<PAGE>
FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference in this
prospectus contain statements that are "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. When we use the words "anticipate," "assume,"
"believe," "estimate," "expect," "intend" and other similar expressions, they
generally identify forward-looking statements. Forward-looking statements
include, for example, statements relating to acquisitions and related financial
information, development activities, business strategy and prospects, future
capital expenditures, sources and availability of capital, environmental and
other regulations and competition.
You should exercise caution in interpreting and relying on forward-looking
statements since they involve known and unknown risks, uncertainties and other
factors which are, in some cases, beyond our control and could materially affect
our actual results, performance or achievements. Some of the factors that could
cause our actual results, performance or achievements to differ materially from
those expressed or implied by forward-looking statements include, but are not
limited to, the following:
. we are subject to general risks affecting the real estate industry, such
as the need to enter into new leases or renew leases on favorable terms
to generate rental revenues, and dependence on our tenants' financial
condition;
. we may fail to identify, acquire, construct or develop additional
properties; we may develop properties that do not produce a desired
yield on invested capital; or we may fail to effectively integrate
acquisitions of properties or portfolios of properties;
. financing may not be available, or may not be available on favorable
terms;
. we need to make distributions to our stockholders for us to qualify as a
real estate investment trust, and if we need to borrow the funds to make
such distributions such borrowings may not be available on favorable
terms;
. we depend on the primary markets where our properties are located and
these markets may be adversely affected by local economic and market
conditions which are beyond our control;
. we are subject to potential environmental liabilities;
. we are subject to complex regulations relating to our status as a real
estate investment trust and would be adversely affected if we failed to
qualify as a real estate investment trust; and
. market interest rates could adversely affect the market prices for our
common stock, as well as our performance and cash flow.
We caution you that, while forward looking statements reflect our good
faith beliefs, they are not guarantees of future performance. In addition, we
disclaim any obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or otherwise.
5
<PAGE>
OUR COMPANY
Boston Properties, Inc.
. We are one of the largest owners and developers of office properties in
the United States , with a significant presence in Greater Boston;
Midtown Manhattan; Greater Washington, D.C.; Greater San Francisco,
Princeton/East Brunswick, New Jersey; Richmond, Virginia; and Baltimore,
Maryland.
. As of March 31, 1999, we owned 124 properties, aggregating more than
32 million square feet. Our properties consist of 111 office properties,
consisting of 79 Class A office buildings, including eight under
development and 32 properties that support both office and technical
uses, nine industrial properties, three hotels and one parking garage.
. We are a Delaware corporation formed in 1997 to continue and expand the
operations of our predecessor organization founded by Messrs. Mortimer
B. Zuckerman and Edward H. Linde. We have elected to be taxed as a real
estate investment trust for federal income tax purposes and operate
principally through Boston Properties Limited Partnership, a Delaware
limited partnership. We are currently an approximate 67.3% economic
owner of the common equity of Boston Properties Limited Partnership. We
control Boston Properties Limited Partnership as its sole general
partner.
. Our executive offices are located at 800 Boylston Street, Boston,
Massachusetts 02199 and our telephone number is (617) 236-3300.
6
<PAGE>
DESCRIPTION OF COMMON STOCK
The following is a summary of the material terms and provisions of our
common stock. It may not contain all the information that is important to you.
You can access complete information by referring to our certificate of
incorporation, bylaws, our shareholder rights plan and the Delaware General
Corporate Law. Our shareholder rights plan is summarized below. Our shareholder
rights plan, certificate of incorporation and bylaws are incorporated by
reference into the registration statement of which this prospectus is a part.
General
Under our certificate of incorporation, we have authority to issue
250,000,000 shares of common stock, par value $.01 per share. As of May 13,
1999, 63,548,144 shares of common stock were issued and outstanding. In
addition, as of May 13, 1999, 23,816,811 common units of Boston Properties
Limited Partnership which are exchangeable for common stock on a one-for-one
basis were outstanding. We may issue common stock from time to time. Our board
of directors must approve the amount of stock we sell and the price for which it
is sold. Holders of our common stock do not have any preferential rights or
preemptive rights to buy or subscribe for capital stock or other securities that
we may issue. However, each outstanding share of our common stock currently has
attached to it one preferred share purchase right issued under our shareholder
rights plan, which is summarized below. Our common stock does not have any
redemption or sinking fund provisions or any conversion rights.
All of our common stock, when issued, will be duly authorized, fully paid
and nonassessable. This means that the full price for our outstanding common
stock will have been paid at the time of issuance and that any holder of our
common stock will not later be required to pay us any additional money for such
common stock.
Dividends
Subject to the preferential rights of any other shares of our stock and the
provisions of our certificate of incorporation regarding excess shares, holders
of our common stock may receive dividends out of assets that we can legally use
to pay dividends, when and if, they are authorized and declared by our board of
directors. Each common stockholder shares in the same proportion as other common
stockholders out of assets that we can legally use to pay distributions after we
pay or make adequate provision for all of our known debts and liabilities in the
event we are liquidated, dissolved or our affairs are wound up.
Voting rights
Subject to the provisions of our certificate of incorporation regarding
excess shares, holders of common stock will have the exclusive power to vote on
all matters presented to our stockholders, including the election of directors,
except as otherwise provided by Delaware law or as provided with respect to any
other shares of our stock. Holders of our common stock are entitled to one vote
per share. There is no cumulative voting in the election of our directors, which
means that at any meeting of our stockholders, the holders of a majority of the
outstanding common stock can elect all of the directors then standing for
election.
Other rights
Subject to the provisions of our certificate of incorporation regarding
excess shares, all shares of our common stock have equal dividend, distribution,
liquidation and other rights, and have no preference, appraisal or exchange
rights, except for any appraisal rights provided by Delaware law.
Holders of our common stock have no conversion, sinking fund or redemption
rights, or preemptive rights to subscribe for any of our securities.
7
<PAGE>
Delaware law generally requires that we obtain the approval of a majority
of the outstanding shares of our common stock that are entitled to vote before
we may consolidate our stock or merge with another corporation. However,
Delaware law does not require that we seek approval of our stockholders to enter
into a merger in which we are the surviving corporation following the merger if:
. our certificate of incorporation is not amended in any respect by the
merger;
. each share of our stock outstanding prior to the merger is to be an
identical share of stock following the merger; and
. any shares of common stock (together with any other securities
convertible into shares of common stock) to be issued or delivered as a
result of the merger represent no more than 20% of the number of shares
of our common stock outstanding immediately prior to the merger.
Restrictions on ownership
For us to qualify as a real estate investment trust under the Internal
Revenue Code, no more than 50% in value of our outstanding stock may be owned,
actually or constructively, by five or fewer individuals during the last half of
a taxable year. To assist us in meeting this requirement, we may take actions
such as the automatic conversion of shares in excess of this ownership
restriction into excess shares to limit the ownership of our outstanding equity
securities, actually or constructively, by one person or entity. See "Limits on
Ownership of Stock" beginning on page 11.
Transfer agent
The transfer agent and registrar for our common stock is BankBoston, N.A.
Preferred shares
Under our certificate of incorporation, we have authority to issue up to
50,000,000 shares of preferred stock. At May 13, 1999, we had outstanding
2,000,000 shares of Series A Convertible Redeemable Preferred Stock. The general
terms of our Series A convertible redeemable preferred stock are as follows:
. Dividends on our Series A stock are cumulative from the date of original
issuance and payable quarterly generally at a rate of 5.0% per annum
through March 31, 1999; 5.5% through December 31, 1999; 5.625% through
December 31, 2000; 6.0% through December 31, 2001; 6.5% through December
31, 2002; 7.0% until May 12, 2009; and 6.0% thereafter.
. On or after December 31, 2002, shares of our Series A stock are
convertible, at the holder's election, into shares of our common stock
at a conversion price of $38.10 per share of common stock.
. Beginning on May 12, 2009, the Series A stock may be redeemed in six
annual tranches at the election of either the holder or us. The
liquidation preference of our Series A stock is $50 per share.
Under our certificate of incorporation, we have authority to issue up to
150,000,000 shares of Series E Junior Participating Cumulative Preferred Stock.
At May 13, 1999, none of the Series E Junior Participating Cumulative Preferred
Stock were issued or outstanding. Shares of our Series E Junior Participating
Cumulative Preferred Stock may be issued under our shareholder rights plan,
which is summarized beginning on page 9.
8
<PAGE>
We do not have any other preferred stock outstanding as of the date of this
prospectus. We may issue preferred stock from time to time, in one or more
series, as authorized by our board of directors. Prior to issuance of shares of
each series, our board of directors is required by the Delaware General
Corporation Law and our certificate of incorporation to fix for each series,
subject to the provisions of our certificate of incorporation regarding excess
shares, the terms, preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends or other distributions, qualifications
and terms or conditions of redemption, as are permitted by Delaware law. The
preferred stock will, when issued, be fully paid and nonassessable and will have
no preemptive rights. Our board of directors could authorize the issuance of
preferred stock with terms and conditions that could have the effect of
discouraging a takeover or other transaction that holders of our common stock
might believe to be in their best interests or in which holders of some, or a
majority, of our common stock might receive a premium for their shares over the
then market price of such common stock.
Shareholder rights plan
In 1997, our board of directors adopted a shareholder rights plan and
entered into a shareholder rights agreement with BankBoston, N.A., as rights
agent. The purpose of our Shareholder rights plan is to enhance our board of
directors' ability to protect our stockholders' interests by ensuring that such
stockholders receive fair treatment in the event that any coercive takeover
attempt of Boston Properties is made in the future. The rights plan is intended
to provide our board of directors with sufficient time to consider any and all
alternatives to such an action. The rights may discourage, delay or prevent
hostile takeovers. They are not intended, however, to interfere with any merger
or other business combination approved by our board of directors.
Under our shareholder rights plan, one preferred stock purchase right is
attached to each outstanding share of our common stock. We refer to these
preferred stock purchase rights as the "rights." Each share of common stock
issued in the future will also receive a right until any of the rights become
exercisable. Until a right is exercised, the holder of a right does not have any
additional rights as a stockholder. These rights will expire on June 11, 2007,
unless previously redeemed or exchanged by us as described below. These rights
trade automatically with our common stock and will separate from the common
stock and become exercisable only under the circumstances described below.
In general, the rights will become exercisable when the first of the
following events happens:
1. ten calendar days after a public announcement that a person or group
has acquired beneficial ownership of 15% or more of the sum of our
outstanding common stock and excess stock; or
2. ten business days, or such other date determined by our board of
directors, after the beginning of a tender offer or exchange offer that
would result in a person or group beneficially owning 15% or more of
the sum of our outstanding common stock and excess stock.
Under our shareholder rights plan, our common stock that may be issued in
exchange for outstanding common units of limited partnership interest in Boston
Properties Limited Partnership are not included in the definition of beneficial
ownership.
However, if a person who became a limited partner of Boston Properties
Limited Partnership at the time of our initial public offering acquires
beneficial ownership of 15% or more of the sum of our common stock and excess
stock, the rights will not become exercisable unless the acquisition results in
that person acquiring a greater percentage of the outstanding shares of our
outstanding common stock plus outstanding common units of limited partnership
interest of Boston Properties Limited Partnership than the percentage of
outstanding shares of common stock plus outstanding common units of limited
partnership interest of Boston Properties Limited Partnership that person held
at the
9
<PAGE>
completion of our initial public offering. In addition, no group of which a
person who became a partner of Boston Properties Limited Partnership at the time
of our initial public offering is a member will be deemed to beneficially own
our common stock and excess stock owned by that person. Common units of limited
partnership interest of Boston Properties Limited Partnership held by Boston
Properties are excluded in making these calculations.
If the rights become exercisable, holders of the rights will be able to
purchase from us a unit of preferred stock equal to one ten-thousandth of a
share of our Series E Junior Participating Cumulative Preferred Stock at a price
of $100 per unit, subject to adjustment. We have designated 200,000 shares of
Series E Junior Participating Cumulative Preferred Stock and have reserved such
shares for issuance under our shareholder rights plan. However, all rights owned
by any persons or groups triggering the event shall be void.
In addition, if at any time following a public announcement that a person
or group has acquired beneficial ownership of 15% or more of the sum of our
outstanding common stock and excess stock:
. we enter into a merger or other business combination transaction in
which we are not the surviving entity;
. we enter into a merger or other business combination transaction in
which all or part of our common stock is exchanged; or
. we sell, transfer or mortgage 50% or more of our assets or earning
power,
then each holder of a right, other than rights held by the person or group who
triggered the event, will be entitled to receive, upon exercise, common stock of
the acquiring company equal to two times the purchase price of the right.
At any time after our public announcement that a person or group has
acquired beneficial ownership of 15% or more of the sum of our outstanding
common stock and excess stock, our board of directors may, at its option,
exchange all or any part of the then outstanding and exercisable rights for
shares of our common stock or units of Series E Preferred Stock at an exchange
ratio of one share or one unit per right. However, our board of directors
generally will not be empowered to effect such exchange at any time after any
person becomes the beneficial owner of 50% or more of our outstanding common
stock.
We may redeem the rights at $.001 per right at any time before the date
that is ten days after a public announcement that a person or group has acquired
beneficial ownership of 15% or more of the sum of our outstanding common stock
and excess stock. We may extend this redemption period at any time while the
rights are still redeemable. The rights will expire at the close of business on
June 11, 2007 unless we redeem them before that date.
The above description of our shareholder rights plan is not intended to be
a complete description. For a full description of the shareholder rights plan,
you should read the rights agreement. You may obtain a copy of the rights
agreement at no charge by writing to us at the address listed on page 6.
10
<PAGE>
LIMITS ON OWNERSHIP OF OUR STOCK
Ownership limits
For us to qualify as a real estate investment trust under the Internal
Revenue Code, among other things, not more than 50% in value of our outstanding
stock may be owned, actually or constructively, by five or fewer individuals
during the last half of a taxable year other than the first year, and such stock
must be beneficially owned by 100 or more persons during at least 335 days of a
taxable year of 12 months other than the first year or during a proportionate
part of a shorter taxable year. In order to protect us against the risk of
losing our status as a real estate investment trust due to a concentration of
ownership among our stockholders, our certificate of incorporation provides that
generally no holder may beneficially own, or be deemed to own by virtue of the
attribution provisions of the Internal Revenue Code, more than 6.6% of any class
or series of our stock. Under our certificate of incorporation, a person
generally "beneficially owns" shares if:
. such person has direct ownership of such shares,
. such person has indirect ownership of such shares taking into account
the constructive ownership rules of Section 544 of the Internal Revenue
Code, as modified by Section 856(h)(1)(B) of the Internal Revenue Code,
or
. such person would be deemed to beneficially own such shares pursuant to
Rule 13d-3 under the Exchange Act of 1934, as amended.
Our certificate of incorporation allows two exceptions to the 6.6%
ownership limit :
15% Related party ownership limit:
Each of Messrs. Zuckerman and Linde, together with their respective heirs,
legatees, devisees and any other person whose beneficial ownership of our
common stock would be attributed under the Internal Revenue Code to them,
are subject to an ownership limit of 15% for each of them together with
such persons related to them.
15% Look-through entity ownership limit:
Pension plans described in Section 401(a) of the Internal Revenue Code and
mutual funds registered under the Investment Company Act of 1940 are
subject to an ownership limit of 15%. Pension plans and mutual funds are
among the entities that are not treated as stockholders under the "five or
fewer requirement." Rather, the beneficial owners of such entities will be
counted as stockholders for this purpose.
The foregoing restrictions will not apply if our board of directors
determines that it is no longer in our best interests to attempt to qualify, or
to continue to qualify, as a real estate investment trust. In addition, the
foregoing restrictions do not apply with respect to an offeror in the event of
an all cash tender offer by it which has been accepted by at least two-thirds of
our outstanding stock.
Shares in excess of ownership limits
Transfers of our stock or any security convertible into our stock or other
events that would create a direct or indirect ownership of our stock that would:
. violate the 6.6% ownership limit;
. violate the 15% ownership limit for related parties:
11
<PAGE>
. violate the 15% ownership limit for look-through entities; or
. result in our disqualification as a real estate investment trust,
including any transfer that results in:
. our stock being owned by fewer than 100 persons,
. Boston Properties being "closely held" with the meaning of Section
856(h) of the Internal Revenue Code, or
. Boston Properties constructively owning 10% or more of one of our
tenants
shall be null and void and of no effect with respect to the shares in excess of
the applicable limit. Any such shares in excess of an applicable limitation will
be converted automatically into an equal number of shares of our excess stock
that will be transferred by operation of law to a trust for the benefit of a
qualified charitable organization selected by us, but not affiliated with us.
As soon as practicable after the transfer of shares to the trust, the trustee of
the trust will be required to sell such excess shares to a person or entity who
could own such shares without violating the applicable limit and distribute to
the original transferee-stockholder an amount equal to the lesser of:
. the proceeds of such sale, or
. the price paid for our stock in excess of the applicable limit by the
original transferee-owner or, in the event that the original violative
transfer was a gift or an event other than a transfer, the fair market
value of the excess shares on the date they are sold by the trust.
All dividends and other distributions received with respect to the excess
shares prior to their sale by the trust and any proceeds from the sale by the
trust in excess of the amount distributable to the original transferee-owner
will be distributed to the beneficiary of the trust.
Right to purchase excess shares
In addition to the foregoing transfer restrictions, we have the right, for
a period of 90 days during the time any excess shares are held by the trust, to
purchase all or any portion of the excess shares for the lesser of the price
paid for the shares in excess of the applicable limit by the original
transferee-stockholder or the market price of our stock on the date we exercise
our option to purchase, which amount will be paid to the original transferee-
stockholder. The market price will be determined in the manner set forth in our
certificate of incorporation. The 90-day period begins on the date of the
violative transfer if the original transferee-stockholder gives notice to us of
the transfer or, if no such notice is given, the date on which the board of
directors determines that a violative transfer has been made.
Disclosure of stock ownership by our stockholders
Each of our stockholders will upon demand be required to disclose to us in
writing any information with respect to the direct, indirect and constructive
ownership of shares of our stock as our board of directors deems necessary to
comply with the provisions of the Internal Revenue Code applicable to real
estate investment trusts, to comply with the requirements of any taxing
authority or governmental agency or to determine any such compliance.
These ownership limitations may have the effect of precluding the
acquisition of control of Boston Properties unless our board of directors
determines that our maintenance of real estate investment trust status is no
longer in our best interests.
12
<PAGE>
IMPORTANT PROVISIONS OF DELAWARE LAW AND
OUR CERTIFICATE OF INCORPORATION AND BYLAWS
The following is a summary of important provisions of Delaware law and our
certificate of incorporation and bylaws which affect us and our stockholders.
The description below is intended as only a summary. You can access complete
information by referring to Delaware General Corporation Law and our certificate
of incorporation and bylaws.
Business combinations with interested stockholders under Delaware law
Section 203 of the Delaware General Corporation Law prevents a publicly
held corporation from engaging in a "business combination" with an "interested
stockholder" for a period of three years after the date of the transaction in
which the person became an interested stockholder, unless:
. before the date on which the person became an interested stockholder,
the board of directors of the corporation approved either the business
combination or the transaction in which the person became an interested
stockholder;
. the interested stockholder owned at least 85% of the outstanding voting
stock of the corporation at the beginning of the transaction in which it
became an interested stockholder, excluding stock held by directors who
are also officers of the corporation and by employee stock plans that do
not provide participants with the rights to determine confidentially
whether shares held subject to the plan will be tendered in a tender or
exchange offer; or
. after the date on which the interested stockholder became an interested
stockholder, the business combination is approved by the board of
directors and the holders of two-thirds of the outstanding voting stock
of the corporation voting at a meeting, excluding the voting stock owned
by the interested stockholder.
As defined in Section 203, an "interested stockholder" is generally a
person owning 15% or more of the outstanding voting stock of the corporation. As
defined in Section 203, a "business combination" includes mergers,
consolidations, stock and assets sales and other transactions with the
interested stockholder.
The provisions of Section 203 may have the effect of delaying, deferring or
preventing a change of control of Boston Properties.
Amendment of our certificate of incorporation and bylaws
Amendments to our certificate of incorporation must be approved by our
board of directors and generally by the vote of a majority of the votes entitled
to be cast at a meeting of our stockholders. However, a 75% stockholder vote is
required for amendments dealing with fundamental governance provisions of our
certificate of incorporation, such as:
. stockholder action
. the powers, election of, removal of and classification of directors
. limitation of liability
. amendment of our certificate of incorporation
Unless otherwise required by law, our board of directors may amend our
bylaws by a majority vote of our directors then in office. Our bylaws may also
be amended by a majority stockholder vote if our board of directors recommends
the approval of the amendment, and otherwise by a 75% stockholder vote.
13
<PAGE>
Meetings of stockholders
Under our bylaws, we will hold annual meetings of our stockholders at such
date and time as determined by our board of directors, Chairman or President.
Our bylaws require advance notice for our stockholders to make nominations of
candidates for our board of directors or bring other business before an annual
meeting of our stockholders. Only our board of directors can call special
meetings of our stockholders and any special meeting is restricted to
considering and acting upon matters set forth in the notice of that special
meeting.
Board of directors
Our board of directors is divided into three classes. As the term of each
class expires, directors in that class will be elected for a term of three years
and until their successors are duly elected and qualified.
Our certificate of incorporation provides that a 75% vote of our board of
directors is required to approve fundamental changes or actions, including:
. a change of control of Boston Properties or of Boston Properties Limited
Partnership
. any amendment to the limited partnership agreement of Boston Properties
Limited Partnership
. any waiver of the limitations on ownership contained in our certificate
of incorporation
. certain issuances of equity securities by Boston Properties
. termination of our status as a REIT.
Shareholder rights plan and ownership limitations
We have adopted a shareholder rights agreement. In addition, our
certificate of incorporation contains provisions that limit the ownership by any
person of shares of any class or series of our capital stock. See "Shareholder
rights plan" beginning on page 9 and "Limits on ownership of our stock"
beginning on page 11.
Limitation of directors' and officers' liability
Our certificate of incorporation generally limits the liability of our
directors to Boston Properties to the fullest extent permitted by Delaware law,
as it now exists or may in the future be amended. The Delaware General
Corporation Law permits a corporation to indemnify its directors, officers,
employees or agents and expressly provides that the indemnification provided for
under the Delaware General Corporation Law shall not be deemed exclusive of any
indemnification right under any bylaw, vote of stockholders or disinterested
directors, or otherwise. Delaware law permits indemnification against expenses
and certain other liabilities arising out of legal actions brought or threatened
against such persons for their conduct on behalf of a corporation, provided that
each such person acted in good faith and in a manner that he or she reasonably
believed was in or not opposed to the corporation's best interests and, in the
case of a criminal proceeding, provided such person had no reasonable cause to
believe his or her conduct was unlawful. Delaware law does not allow
indemnification of directors in the case of an action by or in the right of a
corporation unless the directors successfully defend the action or
indemnification is ordered by the court.
14
<PAGE>
Our bylaws provide that our directors and officers will be, and, in the
discretion of our board of directors, non-officer employees may be, indemnified
by Boston Properties to the fullest extent authorized by Delaware law, as it now
exists or may in the future be amended, against all expenses and liabilities
actually and reasonably incurred in connection with service for or on behalf of
Boston Properties. Our bylaws also provide that the right of directors and
officers to indemnification shall be a contract right and shall not be exclusive
of any other right now possessed or hereafter acquired under any bylaw,
agreement, vote of stockholders, or otherwise.
Our certificate of incorporation contains a provision permitted by Delaware
law that generally eliminates the personal liability of directors for monetary
damages for breaches of their fiduciary duty, including breaches involving
negligence or gross negligence in business combinations, unless the director has
breached his or her duty of loyalty, failed to act in good faith, engaged in
intentional misconduct or a knowing violation of law, paid a dividend or
approved a stock repurchase in violation of the Delaware General Corporation Law
or obtained an improper personal benefit. This provision does not alter a
director's liability under the federal securities laws. In addition, this
provision does not affect the availability of equitable remedies, such as an
injunction or rescission, for breach of fiduciary duty.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling Boston Properties
pursuant to the foregoing provisions, we have been informed that in the opinion
of the SEC such indemnification is against public policy as expressed in the
Securities Act and is therefore unenforceable.
Indemnification agreements
We have entered into indemnification agreements with each of our directors
and executive officers. The indemnification agreements require, among other
things, that we indemnify our directors and executive officers to the fullest
extent permitted by law and advance to our directors and executive officers all
related expenses, subject to reimbursement if it is subsequently determined that
indemnification is not permitted. Under these agreements, we must also indemnify
and advance all expenses incurred by our directors and executive officers
seeking to enforce their rights under the indemnification agreements and cover
our directors and executive officers under our directors' and officers'
liability insurance. Although the form of indemnification agreement offers
substantially the same scope of coverage afforded by our certificate of
incorporation and our bylaws, it provides greater assurance to our directors and
executive officers that indemnification will be available, because, as a
contract, it cannot be modified unilaterally in the future by our board of
directors or by our stockholders to eliminate the rights it provides.
15
<PAGE>
FEDERAL INCOME TAX CONSIDERATIONS AND CONSEQUENCES OF YOUR INVESTMENT
The following is a general summary of the material federal income tax
considerations and consequences associated with an investment in our common
stock. The following discussion is not exhaustive of all possible tax
considerations and is not tax advice. Moreover, this summary does not deal with
all tax aspects or consequences that might be relevant to you in light of your
personal circumstances; nor does it deal with particular types of stockholders
that are subject to special treatment under the Internal Revenue Code, such as
insurance companies, financial institutions and broker-dealers. The Internal
Revenue Code provisions governing the federal income tax treatment of real
estate investment trusts are highly technical and complex, and this summary is
qualified in its entirety by the applicable Internal Revenue Code provisions,
rules and regulations promulgated thereunder, and administrative and judicial
interpretations thereof. The following discussion is based on current law and on
representations from us concerning our compliance with the requirements for
qualification as a real estate investment trust.
We urge you, as a prospective investor, to consult your own tax advisor
with respect to the specific federal, state, local, foreign and other tax
consequences to you of the purchase, holding and sale of our common stock.
Federal income taxation
In the opinion of our tax counsel, Goodwin, Procter & Hoar LLP, commencing
with our first taxable year ended December 31, 1997, we have been organized in
conformity with the requirements for qualification as a real estate investment
trust under the Internal Revenue Code, and our method of operation will enable
us to continue to meet the requirements for qualification and taxation as a real
estate investment trust under the Internal Revenue Code, provided that we have
operated and continue to operate in accordance with various assumptions and
factual representations made by us concerning our business, properties and
operations. We may not, however, have met or continue to meet such requirements.
Qualification as a real estate investment trust depends upon us having met and
continuing to meet the various requirements imposed under the Internal Revenue
Code through actual operating results. Goodwin, Procter & Hoar LLP has relied on
our representations regarding our operations and has not and will not review
these operating results. No assurance can be given that actual operating results
have met or will meet these requirements.
If we have qualified and continue to qualify for taxation as a real estate
investment trust, we generally will not be subject to federal corporate income
taxes on that portion of our ordinary income or capital gain that is currently
distributed to stockholders. The real estate investment trust provisions of the
Internal Revenue Code generally allow a real estate investment trust to deduct
dividends paid to its stockholders. This deduction for dividends paid to
stockholders substantially eliminates the federal double taxation on earnings
that usually results from investments in a corporation. "Double taxation" refers
to taxation of income once at the corporate level when earned and once again at
the stockholder level when distributed. Additionally, a real estate investment
trust may elect to retain and pay taxes on a designated amount of its net long-
term capital gains, in which case the stockholders of the real estate investment
trust will include their proportionate share of the undistributed long-term
capital gains in income and receive a credit or refund for their share of the
tax paid by the real estate investment trust.
Failure to qualify
If we fail to qualify for taxation as a real estate investment trust in any
taxable year and the relief provisions do not apply, we will be subject to tax
on our taxable income at regular corporate rates, including any applicable
alternative minimum tax. Distributions to stockholders in any year in which we
fail to qualify will not be deductible by us nor will they be required to be
made. In such event, to the extent of current or accumulated earnings and
profits, all distributions to stockholders will be dividends, taxable as
ordinary income, and subject to limitations of the Internal Revenue Code,
corporate distributees may be eligible for the dividends-received deduction.
Unless we are
16
<PAGE>
entitled to relief under specific statutory provisions, we also will be
disqualified from taxation as a real estate investment trust for the four
taxable years following the year during which qualification was lost. It is not
possible to state whether in all circumstances we would be entitled to such
statutory relief. For example, we must derive a minimum percent of our gross
income from specified sources in order to qualify as a real estate investment
trust. If we fail to satisfy these gross income tests because nonqualifying
income that we intentionally incur exceeds the limit on such income, the
Internal Revenue Service could conclude that our failure to satisfy the tests
was not due to reasonable cause, which is a condition to qualification for
relief from the four-year disqualification rule.
Taxation of United States stockholders and potential tax consequences of their
investment in our common stock
When we refer to a United States stockholder, we mean a holder of common
stock that is for federal income tax purposes
. an individual who is a citizen or resident of the United States;
. a corporation created or organized in or under the laws of the United
States, any state thereof or the District of Columbia; or
. a partnership, trust or estate treated as a domestic partnership, trust
or estate.
For any taxable year for which we qualify for taxation as a real estate
investment trust, amounts distributed to taxable United States stockholders will
be taxed as follows.
Distributions generally. Distributions other than capital gain dividends
to United States stockholders will be taxable as dividends to the extent of our
current or accumulated earnings and profits as determined for federal income tax
purposes. For purposes of determining whether distributions are out of current
or accumulated earnings and profits, our earnings and profits will be allocated
first to any of our outstanding preferred shares and then to our common stock.
Such dividends will be taxable to the stockholders as ordinary income and will
not be eligible for the dividends-received deduction for corporations. To the
extent that we make a distribution to a United States stockholder in excess of
current or accumulated earnings and profits, the distribution will be treated
first as a tax-free return of capital with respect to the shares, reducing the
United States stockholder's tax basis in the shares, and the distribution in
excess of a United States stockholder's tax basis in the shares will be taxable
as gain realized from the sale of the shares. Dividends declared by us in
October, November or December of any year payable to a stockholder of record on
a specified date in any such month shall be treated as both paid by us and
received by the stockholder on December 31 of the year, provided that the
dividend is actually paid by us during January of the following calendar year.
United States stockholders may not include on their own federal income tax
returns any of our tax losses.
Capital gain dividends. Dividends to United States stockholders that are
properly designated by us as capital gain dividends will be treated as long-term
capital gains, to the extent they do not exceed our actual net capital gains,
for the taxable year without regard to the period for which the stockholder has
held its common stock. However, corporate stockholders may be required to treat
up to 20% of particular capital gain dividends as ordinary income. Capital gain
dividends are not eligible for the dividends-received deduction for
corporations.
Retained capital gains. A real estate investment trust may elect to
retain, rather than distribute, its net long-term capital gains received during
the year. To the extent designated by the real estate investment trust in a
notice to its stockholders, the real estate investment trust will pay the income
tax on such gains and the real estate investment trust stockholders must include
their proportionate share of the undistributed long-term capital gains so
designated in income. Each real estate investment trust stockholder will be
deemed to have paid its share of the tax paid by the real estate investment
trust, which will be credited or refunded to the stockholder. The basis of each
17
<PAGE>
stockholder's real estate investment trust shares will be increased by its
proportionate amount of the undistributed long-term capital gains, net of the
tax paid by the real estate investment trust, included in such stockholder's
long-term capital gains.
Passive activity loss and investment interest limitations. Distributions,
including deemed distributions of undistributed long-term capital gains, from us
and gain from the disposition of common stock will not be treated as passive
activity income, and therefore stockholders may not be able to apply any passive
losses against such income. Dividends from us, to the extent they do not
constitute a return of capital, will generally be treated as investment income
for purposes of the investment income limitation on the deductibility of
investment interest. However, net capital gain from the disposition of common
stock or capital gain dividends, including deemed distributions of undistributed
long-term capital gains, generally will be excluded from investment income.
Sale of the common stock. Upon the sale or exchange of common stock, the
United States stockholder will generally recognize gain or loss equal to the
difference between the amount realized on such sale and the tax basis of the
common stock sold or exchanged. Assuming such shares are held as a capital
asset, such gain or loss will be a long-term capital gain or loss if the shares
have been held for more than one year. However, any loss recognized by a United
States stockholder on the sale of common stock held for not more than six months
and with respect to which capital gains were required to be included in such
stockholder's income will be treated as a long-term capital loss to the extent
of the amount of such capital gains so included.
Treatment of tax-exempt stockholders. Distributions, including deemed
distributions of undistributed long-term capital gains, from us to a tax-exempt
employee pension trust or other domestic tax-exempt stockholder generally will
not constitute unrelated business taxable income unless the stockholder has
borrowed to acquire or carry its common stock. However, certain qualified trusts
that hold more than 10% by value of the shares of a particular real estate
investment trust may be required to treat a specified percentage of these
distributions, including deemed distributions of undistributed long-term capital
gains, as unrelated business taxable income.
Backup withholding
Under the backup withholding rules, a United States stockholder may be
subject to backup withholding at the rate of 31% with respect to dividends paid
on, and gross proceeds from the sale of, the common stock unless such
stockholder (1) is a corporation or comes within other specific exempt
categories and, when required, demonstrates this fact or (2) provides a correct
taxpayer identification number, certifies as to no loss of exemption from backup
withholding and otherwise complies with applicable requirements of the backup
withholding rules. A United States stockholder who does not provide us with its
current taxpayer identification number may be subject to penalties imposed by
the Commissioner of the Internal Revenue Service. Any amount paid as backup
withholding will be creditable against the stockholder's income tax liability.
We will report to stockholders and the Internal Revenue Service the amount
of any reportable payments, including any dividends paid, and any amount
withheld with respect to the common stock during the calendar year.
State and local tax
Boston Properties and our stockholders may be subject to state and local
tax in various states and localities, including those in which we or our
stockholders transact business, own property or reside. The tax treatment of us
and our stockholders in such jurisdictions may differ from the federal income
tax treatment described above. Consequently, as a prospective investor, you
should consult your own tax advisors regarding the effect of state and local tax
laws on an investment in our common stock.
18
<PAGE>
REGISTRATION RIGHTS OF THE SELLING STOCKHOLDERS
The following is a summary of the material terms and provisions of the
registration rights and lock-up agreements, which we entered into in connection
with our May 28, 1998 acquisition of a parcel of land in Montgomery County,
Maryland. It may not contain all the information that is important to you. You
can access complete information by referring to the registration rights and
lock-up agreement.
Under the registration rights and lock-up agreement, we are obligated to
file a registration statement covering the sale by the selling stockholders of
the common stock that they may acquire in exchange for the common units of
Boston Properties Limited Partnership that they received when we acquired the
land on May 28, 1998. Under the terms of the registration rights and lock-up
agreement, the selling stockholders may not exchange their units for common
stock until after May 29, 1999. Under the registration rights and lock-up
agreement, we must use reasonable efforts to cause the registration statement to
be declared effective by the Securities and Exchange Commission and to keep the
registration statement continuously effective until the earliest of:
. the date on which the selling stockholders no longer hold any exchanged
common stock or any units issued in connection with the acquisition or
. the date on which all of the exchanged common stock held or acquired in
the future by the selling stockholders have become eligible for sale
under Rule 144(k) of the Securities Act of 1933.
Any common stock sold by the selling stockholders pursuant to this prospectus
will no longer be entitled to the benefits of the registration rights and lock-
up agreements.
The registration rights and lock-up agreement requires that we bear all
expenses of registering the common stock with the exception of brokerage and
underwriting commissions and taxes of any kind and any legal, accounting and
other expenses incurred by the selling stockholders. We also agreed to indemnify
the selling stockholders and their officers, directors and other affiliated
persons and any person who controls a selling stockholder against all losses,
claims, damages, actions, liabilities, costs and expenses arising under the
securities laws in connection with the registration statement or this
prospectus, subject to limitations specified in the registration rights and
lock-up agreements. In addition, the selling stockholders agreed to indemnify
us and our directors, officers and any person who controls our company against
all losses, claims, damages, actions, liabilities, costs and expenses arising
under the securities laws if they result from:
. written information furnished to us by the selling stockholders for use
in the registration statement or this prospectus or any amendments to
the registration statement or any prospectus supplements or
. the selling stockholders' failure to deliver, or cause to be delivered,
this prospectus or any amendments or prospectus supplements to any
purchaser of common stock covered by this prospectus from the selling
stockholders through no fault of ours.
19
<PAGE>
THE SELLING STOCKHOLDERS
The following table sets forth the number of shares of common stock and
units beneficially owned by the selling stockholders as of May 13, 1999, the
number of shares of common stock covered by this prospectus and the total number
of shares of common stock and units which the selling stockholders will
beneficially own upon completion of this offering. This table assumes that the
selling stockholders exchange for common stock all of the units issued by Boston
Properties Limited Partnership in connection with our acquisition of a parcel of
land in Montgomery County, Maryland, and that the selling stockholders offer for
sale all of those common stock.
The common stock offered by the prospectus may be offered from time to time
by the selling stockholders named below, or by any of their pledges, donees,
transferees or other successors in interest. The amounts set forth below are
based upon information provided to us by representatives of the selling
stockholders, or on our records, as of May 13, 1999 and are accurate to the best
of our knowledge. It is possible, however, that the selling stockholders may
acquire or dispose of additional shares of common stock or units from time to
time after the date of this prospectus.
<TABLE>
<CAPTION>
Common stock Units
Beneficially Beneficially Common stock and
Owned as of Owned as of Common stock Units to be Owned
Name May 13, 1999(1) May 13, 1999(2) Offered Hereby(3) After Offering(4)
- ------------------- --------------- --------------- -------------------- -------------------
<S> <C> <C> <C> <C>
Amy S. Rubenstein 0 6,458 6,458 0
Beth Dana Rubenstein 0 6,458 6,458 0
Barton S. Rubenstein 0 6,458 6,458 0
Lishil Enterprises Limited Partnership 0 20,697 20,697 0
Dawson Enterprises Limited Partnership 0 40,073 40,073 0
Tower Capital, LLC 0 512,772 512,772 0
--------- ------- ------- ----------
TOTAL 0 592,916 592,916 0
========== ------- ======= ----------
</TABLE>
_______________________________
(1) Does not include common stock that may be issued in exchange for units
beneficially held as of May 13, 1999.
(2) All units listed in this column may be exchanged, under circumstances set
forth in the partnership agreement of Boston Properties Limited
Partnership, for an equal number of shares of common stock. All information
is as of May 13, 1999.
(3) These shares of common stock represent the common stock that the selling
stockholders may acquire upon presentation of the units for redemption.
Such redemption may occur at any time after May 29, 1999.
(4) Assumes that all common stock issuable upon redemption of the units will be
sold by the selling stockholders. In the case of each selling stockholder,
the percentage of our common stock that will be held by such selling
stockholder (assuming all remaining units held by such person are presented
for redemption and are exchanged for common stock) after completion of this
offering will be less than one percent (1%). The total number of shares of
common stock outstanding used in calculating such percentage (i) is based
on the total number of shares of common stock outstanding as of May 13,
1999 (63,548,144 shares) and (ii) assumes that none of the remaining units
held by other persons will be exchanged for common stock.
20
<PAGE>
USE OF PROCEEDS
We will not receive any of the proceeds of the sale by the selling
stockholders of the common stock covered by this prospectus.
PLAN OF DISTRIBUTION
This prospectus relates to the possible sale from time to time of up to an
aggregate of 592,916 shares of common stock by the selling stockholders, or any
of their pledgees, donees, transferees or other successors in interest. If the
selling stockholders present units to Boston Properties Limited Partnership for
redemption, we may, at our election, acquire such units in exchange for common
stock in accordance with the terms of Boston Properties Limited Partnership's
agreement of limited partnership, as amended. We are registering the common
stock pursuant to our obligations under the registration rights and lock-up
agreement, but the registration of the common stock does not necessarily mean
that any of the common stock will be offered or sold by the selling
stockholders.
The distribution of the common stock may be effected from time to time in
one or more underwritten transactions at a fixed price or prices, which may be
changed, or at market prices prevailing at the time of sale, at prices related
to prevailing market prices or at negotiated prices. Any underwritten offering
may be on a "best efforts" or a "firm commitment" basis. In connection with any
underwritten offering, underwriters or agents may receive compensation in the
form of discounts, concessions or commissions from the selling stockholders.
Underwriters may sell the common stock to or through dealers, and such dealers
may receive compensation in the form of discounts, concessions or commissions
from the underwriters and/or commissions from the purchasers for whom they may
act as agents.
The selling stockholders and any underwriters, dealers or agents that
participate in the distribution of the common stock may be deemed to be
underwriters under the Securities Act of 1933, and any profit on the sale of the
common stock by them and any discounts, commissions or concessions received by
any underwriters, dealers or agents might be deemed to be underwriting discounts
and commissions under the Securities Act of 1933. At any time a particular offer
of common stock is made by the selling stockholders, a prospectus supplement, if
required, will be distributed that will, where applicable:
. identify any underwriter, dealer or agent;
. describe any compensation in the form of discounts, concessions,
commissions or otherwise received by each underwriter, dealer or agent
and in the aggregate to all underwriters, dealers and agents;
. identify the amounts underwritten;
. identify the nature of the underwriter's obligation to take the common
stock; and
. provide any other required information.
The sale of common stock by the selling stockholders may also be effected
by selling common stock directly to purchasers or to or through broker-dealers.
In connection with any such sale, any such broker-dealer may act as agent for
the selling stockholders or may purchase from the selling stockholders all or a
portion of the common stock as principal, and may be made pursuant to any of the
methods described below. Such sales may be made on the New York Stock Exchange
or other exchanges on which the common stock are then traded, in the over-the-
counter market, in negotiated transactions or otherwise at prices and at terms
then prevailing or at prices related to the then-current market prices or at
prices otherwise negotiated.
21
<PAGE>
Common stock may also be sold in one or more of the following transactions:
. block transactions in which a broker-dealer may sell all or a portion of
such shares as agent but may position and resell all or a portion of the
block as principal to facilitate the transaction;
. purchases by any such broker-dealer as principal and resale by such
broker-dealer for its own account pursuant to any supplement to this
prospectus;
. a special offering, an exchange distribution or a secondary distribution
in accordance with applicable New York Stock Exchange or other stock
exchange rules;
. ordinary brokerage transactions and transactions in which any such
broker-dealer solicits purchasers;
. sales "at the market" to or through a market maker or into an existing
trading market, on an exchange or otherwise, for such shares; and
. sales in other ways not involving market makers or established trading
markets, including direct sales to purchasers.
In effecting sales, broker-dealers engaged by the selling stockholders may
arrange for other broker-dealers to participate. Broker-dealers will receive
commissions or other compensation from the selling stockholders in amounts to be
negotiated immediately prior to the sale that will not exceed those customary in
the types of transactions involved. Broker-dealers may also receive compensation
from purchasers of the common stock which is not expected to exceed that
customary in the types of transactions involved.
To comply with applicable state securities laws, the common stock will be
sold, if necessary, in such jurisdictions only through registered or licensed
brokers or dealers. In addition, common stock may not be sold in some states
unless they have been registered or qualified for sale in the state or an
exemption from such registration or qualification requirement is available and
is complied with.
All expenses relating to the offering and sale of the common stock, other
than commissions, discounts and fees of underwriters, broker-dealers or agents,
will be paid by us. We have agreed to indemnify the selling stockholders against
some losses, claims, damages, actions, liabilities, costs and expenses,
including liabilities under the Securities Act of 1933. See "Registration Rights
of the Selling Stockholders."
EXPERTS
The financial statements and schedules for the year ended December 31, 1998
referred to and incorporated by reference in this prospectus and elsewhere in
this registration statement have been audited by PricewaterhouseCoopers LLP,
independent public accountants. These audited financial statements are
incorporated in this prospectus by reference in reliance upon the authority of
PricewaterhouseCoopers LLP as experts in accounting and auditing in giving those
reports.
LEGAL MATTERS
Certain legal matters, including the validity of the common stock offered
through this prospectus, will be passed upon for us by Goodwin, Procter & Hoar
LLP. Gilbert G. Menna, the sole stockholder of Gilbert G. Menna, P.C., a partner
of Goodwin, Procter & Hoar LLP, serves as an Assistant Secretary of Boston
Properties. Certain partners of Goodwin, Procter & Hoar LLP or their affiliates,
together with Mr. Menna, own approximately 20,000 shares of the our common
stock. Goodwin, Procter & Hoar LLP occupies approximately 26,000 square feet at
599 Lexington Avenue, New York, NY under a lease with Boston Properties that
expires in 2002.
VALIDITY OF COMMON STOCK
The validity of the common stock we are offering will be passed upon for us
by Goodwin, Procter & Hoar LLP, Boston, Massachusetts.
22
<PAGE>
================================================ ===========================
You should rely only on the information 592,916 Shares
contained in this prospectus, incorporated of Common Stock
herein by reference or contained in a
prospectus supplement. Neither we nor the
selling stockholders have authorized anyone
else to provide you with different or Boston Properties, Inc.
additional information. The selling
stockholders are not making an offer of these
securities in any state where the offer is not
permitted. You should not assume that the
information in this prospectus, or incorporated
herein by reference, or in any prospectus
supplement is accurate as of any date other
than the date on the front of those documents.
================================================ ===========================
--------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Prospectus Summary........................ 2
Where You Can Find More Information....... 4
Incorporation of Documents By Reference... 4 --------------------
Forward-Looking Statements................ 5
Our Company............................... 6 Prospectus
Description of Common Stock............... 7
Limits on Ownership of Stock.............. 11 --------------------
Important Provisions of Delaware Law and
Our Certificate of Incorporation and
Bylaws................................. 13
Federal Income Tax Considerations and
Consequences of Your Investment........ 16
Registration Rights of the Selling
Stockholders........................... 19
The Selling Stockholders.................. 20
Use of Proceeds........................... 21
Plan of Distribution...................... 21
Experts................................... 22 June __, 1999
Legal Matters............................. 22
Validity of Common Stock.................. 22
</TABLE>
--------------------
================================================ ===========================
<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
-------------------------------------------
The expenses in connection with the issuance and distribution of the
securities being registered are set forth in the following table (all amounts
except the registration fee are estimated):
<TABLE>
<CAPTION>
<S> <C>
Registration fee -- Securities and Exchange Commission.. $ 5,795
Accountants' fees and expenses.......................... 5,000
Blue Sky fees and expenses.............................. 1,500
Legal fees and expenses (other than Blue Sky)........... 7,500
Printing expenses....................................... 2,000
Miscellaneous........................................... 1,705
-------
TOTAL................................................... $23,500
=======
</TABLE>
All expenses in connection with the issuance and distribution of the
securities being offered shall be borne by Boston Properties, Inc.
Item 15. Indemnification of Directors and Officers.
-----------------------------------------
Our certificate of incorporation and bylaws provide certain limitations on
the liability of our directors and officers for monetary damages to Boston
Properties. Our certificate of incorporation and bylaws obligate Boston
Properties to indemnify its directors and officers, and permit Boston Properties
to indemnify its employees and other agents, against certain liabilities
incurred in connection with their service in such capacities. These provisions
could reduce the legal remedies available to Boston Properties and our
stockholders against these individuals.
Our certificate of incorporation limits the liability of our directors and
officers to Boston Properties to the fullest extent permitted from time to time
by the Delaware General Corporation Law. The Delaware General Corporation Law
permits, but does not require, a corporation to indemnify its directors,
officers, employees or agents and expressly provides that the indemnification
provided for under the Delaware General Corporation Law shall not be deemed
exclusive of any indemnification right under any bylaw, vote of stockholders or
disinterested directors, or otherwise. The Delaware General Corporation Law
permits indemnification against expenses and certain other liabilities arising
out of legal actions brought or threatened against such persons for their
conduct on behalf of the corporation, provided that each such person acted in
good faith and in a manner that he reasonably believed was in or not opposed to
the corporation's best interests and in the case of a criminal proceeding, had
no reasonable cause to believe his or her conduct was unlawful. The Delaware
General Corporation Law does not allow indemnification of directors in the case
of an action by or in the right of the corporation (including stockholder
derivative suits) unless the directors successfully defend the action or
indemnification is ordered by the court.
Our certificate of incorporation contains a provision permitted by Delaware
law that generally eliminates the personal liability of directors for monetary
damages for breaches of their fiduciary duty, including breaches involving
negligence or gross negligence in business combinations, unless the director has
breached his or her duty of loyalty, failed to act in good faith, engaged in
intentional misconduct or a knowing violation of law, paid a dividend or
approved a stock repurchase in violation of the Delaware General Corporation Law
or obtained an improper personal benefit. The provision does not alter a
director's liability under the federal securities laws. In addition, this
provision does not affect the availability of equitable remedies, such as an
injunction or rescission, for breach of fiduciary duty.
Our bylaws provide that our directors and officers will be, and, in the
discretion of the board of directors, non-officer employees may be, indemnified
by us to the fullest extent authorized by Delaware law, as it now exists or may
in the future be amended, against all expenses and liabilities actually and
reasonably incurred in connection with service for or on behalf of Boston
Properties. Our bylaws also provide that the right of directors and officers to
indemnification shall be a contract right and shall not
II-1
<PAGE>
be exclusive of any other right now possessed or hereafter acquired under any
bylaw, agreement, vote of stockholders, or otherwise.
We have entered into indemnification agreements with each of our directors
and executive officers. The indemnification agreements require, among other
matters, that we indemnify our directors and officers to the fullest extent
permitted by law and advance to the directors and officers all related expenses,
subject to reimbursement if it is subsequently determined that indemnification
is not permitted. Under these agreements, we must also indemnify and advance all
expenses incurred by directors and officers seeking to enforce their rights
under the indemnification agreements and may cover directors and officers under
our directors' and officers' liability insurance. Although the form of
indemnification agreement offers substantially the same scope of coverage
afforded by law, it provides additional assurance to directors and officers that
indemnification will be available because, as a contract, it cannot be modified
unilaterally in the future by the board of directors or our stockholders to
eliminate the rights it provides. It is the position of the SEC that
indemnification of directors and officers for liabilities under the Securities
Act is against public policy and unenforceable pursuant to Section 14 of the
Securities Act.
Item 16. Exhibits.
--------
4.1 Amended and Restated Certificate of Incorporation of Boston Properties,
Inc. (incorporated herein by reference to Boston Properties, Inc.'s
Registration Statement on Form S-11 (File No. 33-25279)).
4.2 Amended and Restated Bylaws of Boston Properties, Inc. (incorporated
herein by reference to Boston Properties, Inc.'s Registration Statement on
Form S-11 (File No. 333-25279)).
4.3 Second Amended and Restated Agreement of Limited Partnership of Boston
Properties Limited Partnership (incorporated herein by reference to Boston
Properties, Inc.'s Current Report on Form 8-K dated June 30, 1998, filed
with the Commission on July 15, 1998).
4.4 Shareholder Rights Agreement dated as of June 16, 1997 between the Company
and BankBoston, N.A., as Rights Agent (incorporated herein by reference to
Boston Properties, Inc.'s Registration Statement on Form S-11 (File No.
333-25279)).
5.1 Opinion of Goodwin, Procter & Hoar LLP as to the legality of the
securities and interests being registered.
*8.1 Opinion of Goodwin, Procter & Hoar LLP as to certain tax matters.
23.1 Consent of PricewaterhouseCoopers LLP, Independent Public Accountants.
23.2 Consent of Goodwin, Procter & Hoar LLP (included as part of Exhibits 5.1
and 8.1).
24.1 Powers of Attorney (included on the signature page of the Registration
Statement as filed).
99.1 Registration Rights and Lock-Up Agreement, dated May 28, 1998, by and
among Boston Properties, Inc., Amy S. Rubenstein, Beth Dana Rubenstein,
Barton S. Rubenstein, Lishil Enterprises Limited Partnership, Dawson
Enterprises Limited Partnership and Tower Capital, LLC.
*To be filed by amendment.
Item 17. Undertakings.
------------
(a) Boston Properties, Inc. hereby undertakes:
(1) To file, during any period in which offers or sales are being made
pursuant to this Registration Statement, a post-effective amendment to this
Registration Statement:
II-2
<PAGE>
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
Registration Statement; and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement.
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Securities and Exchange Commission by Boston Properties pursuant to Section 13
or 15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in this Registration Statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new Registration Statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(b) Boston Properties hereby undertakes that, for purposes of determining
any liability under the Securities Act of 1933, each filing of Boston
Properties' annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
Boston Properties pursuant to the foregoing provisions, or otherwise, Boston
Properties has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
Boston Properties of expenses incurred or paid by a director, officer or
controlling person of Boston Properties in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, Boston Properties will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Boston
Properties, Inc. certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Boston, the Commonwealth of Massachusetts, on
this 11th day of June, 1999.
BOSTON PROPERTIES, INC.
By: /s/ Edward H. Linde
---------------------------------------------
Name: Edward H. Linde
Title: President and Chief Executive Officer
KNOW ALL BY THESE PRESENTS that each individual whose signature appears
below constitutes and appoints each of Mortimer B. Zuckerman, Edward H. Linde
and David G. Gaw as such person's true and lawful attorney-in-fact and agent
with full power of substitution and resubstitution, for such person in such
person's name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this Registration Statement
(or any Registration Statement for the same offering that is to be effective
upon filing pursuant to Rule 462(b) under the Securities Act of 1933), and to
file the same, with all exhibits thereto, and all documents in connection
therewith, with the Securities and Exchange Commission, granting unto each said
attorney-in-fact and agent full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as such person might or could do
in person, hereby ratifying and confirming all that any said attorney-in-fact
and agent, or any substitute or substitutes of any of them, may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Mortimer B. Zuckerman Chairman of the Board of Directors June 11, 1999
- ---------------------------
Mortimer B. Zuckerman
/s/ Edward H. Linde President and Chief Executive June 11, 1999
- --------------------------- Officer, Director (Principal
Edward H. Linde Executive Officer)
/s/ David G. Gaw Chief Financial Officer (Principal June 11, 1999
- --------------------------- Financial Officer and Principal
David G. Gaw Accounting Officer)
/s/ Alan J. Patricof Director June 11, 1999
- ---------------------------
Alan J. Patricof
/s/ Ivan G. Seidenberg Director June 11, 1999
- ---------------------------
Ivan G. Seidenberg
/s/ Martin Turchin Director June 11, 1999
- ---------------------------
Martin Turchin
/s/ Alan B. Landis Director June 11, 1999
- ---------------------------
Alan B. Landis
/s/ Richard E. Salomon Director June 11, 1999
- ---------------------------
Richard E. Salomon
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<C> <S>
4.1 Amended and Restated Certificate of Incorporation of Boston
Properties, Inc. (incorporated herein by reference to Boston
Properties, Inc.'s Registration Statement on Form S-11
(File No. 33-25279)).
4.2 Amended and Restated Bylaws of Boston Properties, Inc.
(incorporated herein by reference to Boston Properties, Inc.'s
Registration Statement on Form S-11 (File No. 333-25279)).
4.3 Second Amended and Restated Agreement of Limited Partnership of
Boston Properties Limited Partnership (incorporated herein by
reference to Boston Properties, Inc.'s Current Report on Form 8-K
dated June 30, 1998, filed with the Commission on July 15, 1998).
4.4 Shareholder Rights Agreement dated as of June 16, 1997 between the
Company and BankBoston, N.A., as Rights Agent (incorporated herein
by reference to Boston Properties, Inc.'s Registration Statement on
Form S-11 (File No. 333-25279)).
5.1 Opinion of Goodwin, Procter & Hoar LLP as to the legality of the
securities and interests being registered.
*8.1 Opinion of Goodwin, Procter & Hoar LLP as to certain tax matters.
23.1 Consent of PricewaterhouseCoopers LLP, Independent Public
Accountants.
23.2 Consent of Goodwin, Procter & Hoar LLP (included as part of
Exhibits 5.1 and 8.1).
24.1 Powers of Attorney (included on the signature page of the
Registration Statement as filed).
99.1 Registration Rights and Lock-Up Agreement, dated May 28, 1998, by
and among Boston Properties, Inc., Amy S. Rubenstein, Beth Dana
Rubenstein, Barton S. Rubenstein, Lishil Enterprises Limited
Partnership, Dawson Enterprises Limited Partnership and Tower
Capital, LLC.
</TABLE>
*To be filed by amendment.
II-5
<PAGE>
Exhibit 5.1
GOODWIN, PROCTER & HOAR LLP
COUNSELLORS AT LAW
EXCHANGE PLACE
BOSTON, MASSACHUSETTS 02109-2881
June 11, 1999
Boston Properties, Inc.
800 Boylston Street
Boston, MA 02199
Ladies and Gentlemen:
This opinion is furnished in connection with the registration on Form S-3
(the "Registration Statement") pursuant to the Securities Act of 1933, as
amended (the "Securities Act"), of the resale of up to 592,916 shares (the
"Shares") of common stock, par value $.01 per share ("Common Stock"), of Boston
Properties Inc. (the "Company") by a holder thereof, if and to the extent that
the Company elects to issue such shares to such holder to acquire common units
of limited partnership interests ("Units") in Boston Properties Limited
Partnership, a Delaware limited partnership (the "Operating Partnership").
In connection with rendering this opinion, we have examined the Amended and
Restated Certificate of Incorporation and Amended and Restated Bylaws of the
Company, each as amended to date; such records of the corporate proceedings of
the Company as we deemed material; and such other certificates, receipts,
records and documents as we considered necessary for the purposes of this
opinion. In our examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, the authenticity of all documents
submitted to us as certified, photostatic or facsimile copies, the authenticity
of the originals of such copies and the authenticity of telephonic confirmations
of public officials and others. As to facts material to our opinion, we have
relied upon certificates or telephonic confirmations of public officials and
certificates, documents, statements and other information of the Company or
representatives or officers thereof.
We are attorneys admitted to practice in The Commonwealth of Massachusetts.
We express no opinion concerning the laws of any jurisdictions other than the
laws of the United States of America, the laws of The Commonwealth of
Massachusetts, and the Delaware General Corporation Law.
<PAGE>
Based upon the foregoing, we are of the opinion that when the Shares have
been issued in exchange for Units tendered to the Operating Partnership for
redemption as contemplated by the limited partnership agreement of the Operating
Partnership, such Shares will be validly issued, fully paid and nonassessable.
The foregoing assumes that all requisite steps were taken to comply with
the requirements of the Securities Act and applicable requirements of state laws
regulating the offer and sale of securities.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us with respect to this opinion
under the heading "Legal Matters" in the Prospectus which is a part of such
Registration Statement. In giving such consent, we do not thereby admit that we
are in the category of persons whose consent is required under Section 7 of the
Act.
Very truly yours,
/s/ Goodwin, Procter & Hoar LLP
GOODWIN, PROCTER & HOAR LLP
<PAGE>
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated January 24, 1999 except for Note 10
for which the date is February 10, 1999 relating to the financial statements and
financial statement schedule which appears in Boston Properties' Annual Report
on Form 10-K for the year ended December 31, 1998. We also consent to the
reference to our firm under the caption "Experts" in such Registration
Statement.
/s/ PricewaterhouseCoopers LLP
-------------------------------------
PricewaterhouseCoopers LLP
June 8, 1999
<PAGE>
Exhibit 99.1
REGISTRATION RIGHTS AND LOCK-UP AGREEMENT
BY AND BETWEEN
BOSTON PROPERTIES, INC.
AND THE
HOLDERS NAMED HEREIN
Date: May 28, 1998
<PAGE>
TABLE OF CONTENTS
Page
----
1. Certain Definitions 1
2. Lock-up Agreement 3
3. Registration 4
4. State Securities Laws 7
5. Expenses 7
6. Indemnification by the Company 8
7. Covenants of Holders 8
8. Suspension of Registration Requirement: Restriction on Sales 9
9. Black-Out Period 10
10. Additional Shares 10
11. Contribution 10
12. No Other Obligation to Register 11
13. Amendments and Waivers 11
14. Notices 11
15. Successors and Assigns 12
16. Counterparts 12
17. Governing Law 12
18. Severability 12
19. Entire Agreement 12
<PAGE>
RIGHTS REGISTRATION RIGHTS AND LOCK-UP AGREEMENT
------------------------------------------------
This Registration Rights and Lock-Up Agreement (this "Agreement") is
entered into as of May 28, 1998, by and among Boston Properties, Inc., a
Delaware corporation (the "Company"), and certain limited partners of Boston
Properties Limited Partnership, a Delaware limited partnership, who have
executed a signature page to this Agreement (each a "Holder" and, collectively,
the "Holders").
WHEREAS, concurrently herewith the Holders are receiving units of limited
partnership interest ("Units") in Boston Properties Limited Partnership (the
"Operating Partnership"), which Units may be exchanged, at a later date and
subject to certain conditions set forth in the Limited Partnership Agreement of
the Operating Partnership, for shares of common stock of the Company, $.01 par
value ("Common Shares"), in each case issued or to be issued without
registration under the Securities Act of 1933, as amended (the "Securities
Act"), pursuant to that certain Contribution Agreement dated as of April 3, 1998
(the "Contribution Agreement"), between the Operating Partnership, Tower-Dawson
Limited Partnership ("TDLP") and Tower Construction Group, L.L.C. ("TCG") (TDLP
and TCG being hereinafter collectively referred to as the "Contributors"); and
WHEREAS, it is a condition precedent to the obligations of the Contributors
to consummate the transactions described in the Contribution Agreement that the
Company provide the Holders with the registration rights set forth in Section 3
hereof.
NOW, THEREFORE, in consideration of the foregoing, the mutual promises and
agreements set forth herein, and other valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Certain Definitions.
-------------------
As used in this Agreement, in addition to the other terms defined herein,
the following capitalized defined terms shall have the following meanings:
"NASD" shall mean the National Association of Securities Dealers, Inc.
----
"Person" shall mean an individual, partnership, corporation, trust, or
------
unincorporated organization, or a government or agency or political subdivision
thereof.
"Prospectus" shall mean the prospectus included in a Registration
----------
Statement, including any preliminary prospectus, as amended or supplemented by
any prospectus supplement with respect to the terms of the offering of any
portion of the Registrable Shares covered by such Registration Statement, and by
all other amendments and supplements to such prospectus, including post-
effective amendments, and in each case including all material incorporated by
reference therein.
"Registrable Shares" (a) when used with respect to a Holder, shall mean
------------------
the Shares of such Holder, excluding (i) Shares for which a Registration
Statement relating to the sale thereof shall have become effective under the
Securities Act and which have been issued or disposed of
<PAGE>
under such Registration Statement, (ii) Shares sold pursuant to Rule 144 or
(iii) Shares eligible for sale pursuant to Rule 144(k) (or any successor
provision) and (b) when used without reference to a Holder, shall mean the
Registrable Shares of all Holders.
"Registration Expenses" shall mean any and all expenses incident to
---------------------
performance of or compliance with this Agreement, including, without limitation:
(i) all SEC, stock exchange or NASD registration and filing fees; (ii) all fees
and expenses incurred in connection with compliance with state securities or
"blue sky" laws (including reasonable fees and disbursements of counsel in
connection with "blue sky" qualification of any of the Registrable Shares and
the preparation of a Blue Sky Memorandum) and compliance with the rules of the
NASD; (iii) all expenses of any Persons in preparing or assisting in preparing,
word processing, printing and distributing any Registration Statement, any
Prospectus, certificates and other documents relating to the performance of and
compliance with this Agreement; (iv) all fees and expenses incurred in
connection with the listing, if any, of any of the Registrable Shares on any
securities exchange or exchanges pursuant to Section 5 hereof; and (v) the fees
and disbursements of counsel for the Company and of the independent public
accountants of the Company, including the expenses of any special audit or "cold
comfort" letters required by or incident to such performance and compliance.
Registration Expenses shall specifically exclude underwriting discounts and
commissions relating to the sale or disposition of Registrable Shares by a
selling Holder, the fees and disbursements of counsel representing a selling
Holder, and transfer taxes, if any, relating to the sale or disposition of
Registrable Shares by a selling Holder, all of which shall be borne by such
Holder in all cases.
"Registration Statement" shall mean any registration statement of the
----------------------
Company which covers the issuance or resale of any of the Registrable Shares on
an appropriate form, and all amendments and supplements to such registration
statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all materials
incorporated by reference therein.
"Rule 144" means Rule 144 under the Securities Act (or any successor
--------
provision).
"SEC" shall mean the Securities and Exchange Commission.
---
"Shares" (a) when used with respect to a Holder, shall mean any Common
------
Shares issuable to the Holder upon redemption or in exchange for Units held by
such Holder, and (b) when used without reference to a Holder, shall mean the
Shares of all Holders.
2. Lock-up Agreement.
-----------------
(a) Each Holder hereby agrees that, except as set forth in Section
2(b) below, for a period of 366 days from the date hereof (the "Lock-up
Period"), without the prior written consent of the Company, such Holder will not
offer, pledge, sell, contract to sell, grant any options for the sale of, seek
the redemption or exchange of, or otherwise dispose of, directly or indirectly
(collectively, "Dispose of"), any Units (the "Lock-up").
(b) The following Dispositions of Units shall not be subject to
the Lock-up set forth in Section 2(a):
2 of 18
<PAGE>
(i) a Holder who is a natural person may Dispose of Units to his
or her spouse, siblings, parents or any natural or adopted children or other
descendants or to any personal trust in which any such family member or such
Holder retains the entire beneficial interest;
(ii) a Holder that is a corporation, partnership, joint venture or
other business entity may Dispose of Units to one or more Persons who have an
ownership interest in such Holder or to one or more other entities that are
wholly owned and controlled, legally and beneficially, by such Holder or by one
or more of the Persons who have an ownership interest in such Holder;
(iii) a Holder may Dispose of Units on his or her death to such
Holder's estate, executor, administrator or personal representative or to such
Holder's beneficiaries pursuant to a devise or bequest or by laws of descent and
distribution;
(iv) a Holder may Dispose of Units as a gift or other transfer
without consideration; and
(v) a Holder may Dispose of Units pursuant to a pledge, grant of
security interest or other encumbrance effected in a bona fide transaction with
an unrelated and unaffiliated pledgee, and such a pledgee may foreclose upon
such Units;
provided, however, that in the case of any transfer of Units pursuant to clauses
- -------- -------
(i), (ii), (iv) and (v), the transferor shall, at the request of the Company,
provide evidence satisfactory to the Company that the transfer is exempt from
the registration requirements of the Securities Act.
In the event a Holder Disposes of Units as described in this Section 2(b), such
Units shall remain subject to this Agreement and, as a condition of the validity
of such disposition, the transferee shall be required to execute and deliver a
counterpart of this Agreement (except that a pledgee shall not be required to
execute and deliver a counterpart of this Agreement until it forecloses upon
such Units). Thereafter, such transferee shall be deemed to be a Holder for
purposes of this Agreement.
3. Registration.
------------
(a) Filing of Resale Shelf Registration Statement. Subject to the
----------------------------------------------
conditions set forth in this Agreement, the Company shall, prior to the
expiration of the Lock-Up Period, cause to be filed a Registration Statement
under Rule 415 under the Securities Act relating to the sale by the Holders of
all of the Registrable Shares of the Holders in accordance with the terms
hereof, and shall use reasonable efforts to cause such Registration Statement to
be declared effective by the SEC by that date which is 390 days after the date
hereof. The Company agrees to use reasonable efforts to keep the Registration
Statement, after its date of effectiveness, continuously effective with respect
to the Registrable Shares of a particular Holder until the earlier of (a) the
date on which such Holder no longer holds any Registrable Shares or (b) the date
on which all of the Registrable Shares held by such Holder have become eligible
for sale pursuant to Rule 144(k) (or any successor provision) (hereinafter
referred to as the "Resale Shelf Registration Expiration Date").
3 of 18
<PAGE>
(b) Registration Statement Covering Issuance of Common Stock.
--------------------------------------------------------
In lieu of the registration rights set forth in Section 3(a) above, the Company
may, in its sole discretion, prior to the first date upon which the Units held
by the Holders may be redeemed (or such earlier date as may be required under
applicable provisions of the Securities Act), file a registration statement (the
"Issuance Registration Statement") under Rule 415 under the Securities Act
relating to the issuance to Holders of Common Shares upon the redemption of
Units or in exchange for Units. Thereupon, the Company shall use reasonable
efforts to cause such Registration Statement to be declared effective by the SEC
for all Common Shares covered thereby. The Company agrees to use reasonable
efforts to keep the Issuance Registration Statement continuously effective, with
respect to the Registrable Shares of a particular Holder, until the date on
which such Holder has redeemed or exchanged such Holder's Units for Common
Stock. In the event that the Company is unable to cause such Issuance
Registration Statement to be declared effective by the SEC or (except as
otherwise permitted by Sections 8(b) and 9) is unable to keep such Issuance
Registration Statement effective until the date on which each Holder has
redeemed or exchanged such Holder's Units for Common Stock, then the rights of
each Holder set forth in Section 3(a) above shall be restored.
(c) Demand Registration. Subject to the conditions set forth in
-------------------
this Agreement, at any time after the Resale Shelf Registration Expiration Date,
and while any Registrable Shares are outstanding, the Company shall, at the
written request of any Holder who is unable to sell its Registrable Shares
pursuant to Rule 144(k) (or any successor provision), cause to be filed as soon
as practicable after the date of such request by such Holder a Registration
Statement under Rule 415 under the Securities Act relating to the sale by the
Holder of all of the Registrable Shares held by such Holder in accordance with
the terms hereof, and shall use reasonable efforts to cause such Registration
Statement to be declared effective by the SEC as soon as practicable thereafter.
The Company may, in its sole discretion, elect to file the Registration
Statement before receipt of notice from any Holder. The Company agrees to use
reasonable efforts to keep the Registration Statement continuously effective,
after its date of effectiveness, until the date on which such Holder no longer
holds any Registrable Shares.
(d) Piggyback Registration. If, at any time after the Resale Shelf
----------------------
Registration Expiration Date, and while any Registrable Shares or Units are
outstanding and a Registration Statement applicable to Holder under Sections
3(a), 3(b) or 3(c) is not effective, the Company (in its sole discretion and
without any obligation to do so) proposes to file a registration statement under
the Securities Act with respect to an offering solely of Common Shares solely
for cash (other than a registration statement (i) on Form S-8 or any successor
form to such Form or in connection with any employee or director welfare,
benefit or compensation plan, (ii) on Form S-4 or any successor form to such
Form or in connection with an exchange offer, (iii) in connection with a rights
offering exclusively to existing holders of Common Shares, (iv) in connection
with an offering solely to employees of the Company or its subsidiaries, or (v)
relating to a transaction pursuant to Rule 145 of the Securities Act), for its
own account, the Company shall give prompt written notice of such proposed
filing to the Holders. The notice referred to in the preceding sentence shall
offer Holder the opportunity to register such amount of Registrable Shares as
each Holder may request (a "Piggyback Registration"). Subject to the provisions
of Section 4 below,
4 of 18
<PAGE>
the Company shall include in such Piggyback Registration, in the registration
and qualification for sale under the blue sky or securities laws of the various
states and in any underwriting in connection therewith all Registrable Shares
for which the Company has received written requests for inclusion therein within
ten (10) calendar days after the notice referred to above has been given by the
Company to the Holders. Holders of Registrable Shares shall be permitted to
withdraw all or part of the Registrable Shares from a Piggyback Registration at
any time prior to the effective date of such Piggyback Registration. If a
Piggyback Registration is an underwritten primary registration on behalf of the
Company and the managing underwriter advises the Company that the total number
of Common Shares requested to be included in such registration exceeds the
number of Common Shares that can be sold in such offering without impairing the
pricing or other commercial practicality of such offering, the Company will
include in such registration in the following priority: (i) first, all Common
Shares the Company proposes to sell, (ii) second, up to the full number of
Common Shares requested to be included in such registration by the holders
identified in that certain Registration Rights and Lock-Up Agreement dated June
23, 1997, as amended from time to time, by and among Boston Properties, Inc.,
and such holders, and (iii) third, up to the full number of Common Shares
requested to be included in such registration by the Holders and any other
holders of Common Shares or of Units that may be exchanged for Common Shares who
are parties to similar Registration Rights and Lock-Up Agreements with the
Company (other than the Agreement referred to in clause (ii)), provided that, in
the case of clauses (ii) and (iii) the number of Common Shares to be included
will be based on the number of Common Shares that can be sold in the opinion of
such managing underwriter without adversely affecting the price range or
probability of success of such offering. The number of Common Shares that the
managing underwriter determines is available for purposes of clause (iii) shall
be allocated pro rata among the Holders and the other holders described in
clause (iii) on the basis of the number of Common Shares requested to be
included by them in such registration.
(e) Notification and Distribution of Materials. The Company shall
------------------------------------------
notify each Holder of the effectiveness of any Registration Statement applicable
to the Shares of such Holder and shall furnish to each such Holder such number
of copies of the Registration Statement (including any amendments, supplements
and exhibits), the Prospectus contained therein (including each preliminary
prospectus and all related amendments and supplements) and any documents
incorporated by reference in the Registration Statement or such other documents
as such Holder may reasonably request in order to facilitate its sale of the
Registrable Shares in the manner described in the Registration Statement.
(f) Amendments and Supplements. The Company shall prepare and file
--------------------------
with the SEC from time to time such amendments and supplements to the
Registration Statement and Prospectus used in connection therewith as may be
necessary to keep the Registration Statement effective and to comply with the
provisions of the Securities Act with respect to the disposition of all the
Registrable Shares until the earlier of (a) such time as all of the Registrable
Shares have been issued or disposed of in accordance with the intended methods
of disposition by the Holder or issuance by the Company as set forth in the
Registration Statement or (b) the date on which the Registration Statement
ceases to be effective in accordance with the terms of this Section 3. Upon
twenty (20) business days' notice, the Company shall file any supplement or
post-effective amendment to the Registration Statement with respect to the
plan of distribution or such Holder's ownership interests in Registrable
Shares that is reasonably necessary to permit the sale of the
5 of 18
<PAGE>
Holder's Registrable Shares pursuant to the Registration Statement. The Company
shall file any necessary listing applications or amendments to the existing
applications to cause the Shares registered under any Registration Statement to
be then listed or quoted on the primary exchange or quotation system on which
the Common Shares are then listed or quoted.
(g) Notice of Certain Events. The Company shall promptly notify
------------------------
each Holder of, and confirm in writing, the filing of the Registration Statement
or any Prospectus, amendment or supplement related thereto or any post-effective
amendment to the Registration Statement and the effectiveness of any post-
effective amendment.
At any time when a Prospectus relating to the Registration Statement is
required to be delivered under the Securities Act by a Holder to a transferee,
the Company shall immediately notify each Holder of the happening of any event
as a result of which the Prospectus included in such Registration Statement, as
then in effect, includes an untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. In such event, the Company shall promptly prepare and furnish
to each applicable Holder a reasonable number of copies of a supplement to or an
amendment of such Prospectus as may be necessary so that, as thereafter
delivered to the purchasers of Registrable Shares, such Prospectus shall not
include 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
light of the circumstances under which they are made, not misleading. The
Company will, if necessary, amend the Registration Statement of which such
Prospectus is a part to reflect such amendment or supplement.
(h) Exchange Listing. The Company shall use reasonable efforts to
----------------
cause any Common Shares that are issued upon redemption or in exchange for Units
held by Holders to be listed on the principal securities exchange on which
Common Shares at such time are listed.
(i) Rule 153. The Company shall file a sufficient number of copies
--------
of the Prospectus and any post-effective amendments or supplements thereto with
the New York Stock Exchange (or, if the Common shares are no longer listed on
the New York Stock Exchange, with such other exchange or market on which the
Common Shares are then listed) so as to enable the Holders to have the benefits
of the prospectus delivery provisions of Rule 153 under the Securities Act.
(j) Compliance with Filing of Exchange Act Regulations. The company
--------------------------------------------------
covenants that, so long as it is subject to the reporting requirements of the
Exchange Act, it will file with the SEC the reports required to be filed by it
under the Exchange Act.
(k) Rule 144 Cooperation. In connection with any sale, transfer or
--------------------
other disposition by any Holder of any Registrable Securities pursuant to Rule
144 under the Securities Act, the Company shall cooperate with such Holder to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any Securities Act legend, and
enable certificates for such Registrable Securities to be for such number of
shares and registered in such names as the selling Holders may reasonably
request. The Company's obligation set forth in the previous sentence shall be
subject to the delivery, if reasonably requested by the Company or its transfer
agent, by counsel to such Holder, in form and substance reasonably satisfactory
to the Company and its transfer agent, of an opinion that such Securities Act
legend need not appear on such certificate.
6 of 18
<PAGE>
4. State Securities Laws.
---------------------
Subject to the conditions set forth in this Agreement, the Company shall,
in connection with the filing of any Registration Statement hereunder, file such
documents as may be necessary to register or qualify the Registrable Shares
under the securities or "Blue Sky" laws of such states as any Holder may
reasonably request, and the Company shall use its best efforts to cause such
filings to become effective; provided, however, that the Company shall not be
-------- -------
obligated to qualify as a foreign corporation to do business under the laws of
any such state in which it is not then qualified or to file any general consent
to service of process in any such state. Once effective, the Company shall use
its best efforts to keep such filings effective until the earlier of (a) such
time as all of the Registrable Shares have been disposed of in accordance with
the intended methods of disposition by the Holder as set forth in the
Registration Statement, (b) in the case of a particular state, a Holder has
notified the Company that it no longer requires an effective filing in such
state in accordance with its original request for filing or (c) the date on
which the Registration Statement ceases to be effective.
5. Expenses.
--------
The Company shall bear all Registration Expenses incurred in connection
with the registration of the Registrable Shares pursuant to this Agreement,
except that each Holder shall be responsible for any brokerage or underwriting
commissions and taxes of any kind (including, without limitation, transfer
taxes) with respect to any disposition, sale or transfer of Registrable Shares
sold by it and for any legal, accounting and other expenses incurred by it.
6. Indemnification by the Company.
------------------------------
The Company agrees to indemnify each of the Holders and their respective
officers, directors, employees, agents, representatives and affiliates, and each
person or entity, if any, that controls a Holder within the meaning of the
Securities Act, and each other person or entity, if any, subject to liability
because of his, her or its connection with a Holder (each, an "Indemnitee"),
against any and all losses, claims, damages, actions, liabilities, costs and
expenses (including without limitation reasonable fees, expenses and
disbursements of attorneys and other professionals), joint or several, arising
out of or based upon any violation by the Company of any rule or regulation
promulgated under the Securities Act applicable to the Company and relating to
action or inaction required of the Company in connection with any Registration
Statement or Prospectus, or upon any untrue or alleged untrue statement of
material fact contained in the Registration Statement or any Prospectus, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided, that the
--------
Company shall not be liable to such Indemnitee or any person who participates as
an underwriter in the offering or sale of Registrable Shares or any other
person, if any, who controls such underwriter within the meaning of the
Securities Act, in any such case to the extent that any such loss, claim,
damage, liability (or action or proceeding in respect thereof) or expense arises
out of or is based upon (i) an untrue statement or alleged untrue statement or
omission or
7 of 18
<PAGE>
alleged omission made in such Registration Statement or in any such
Prospectus in reliance upon and in conformity with information regarding such
Indemnitee or its plan of distribution or ownership interests which was
furnished to the Company for use in connection with the Registration Statement
or the Prospectus contained therein by such Indemnitee or (ii) such Holder's
failure to send or give a copy of the final, amended or supplemented prospectus
furnished to the Holder by the Company at or prior to the time such action is
required by the Securities Act to the person claiming an untrue statement or
alleged untrue statement or omission or alleged omission if such statement or
omission was corrected in such final, amended or supplemented prospectus.
7. Covenants of Holders.
--------------------
Each of the Holders hereby agrees (a) to cooperate with the Company and to
furnish to the Company all such information concerning its plan of distribution
and ownership interests with respect to its Registrable Shares in connection
with the preparation of a Registration Statement with respect to such Holder's
Registrable Shares and any filings with any state securities commissions as the
Company may reasonably request, (b) to deliver or cause delivery of the
Prospectus contained in such Registration Statement (other than an Issuance
Registration Statement) to any purchaser of the shares covered by such
Registration Statement from the Holder and (c) to indemnify the Company, its
officers, directors, employees, agents, representatives and affiliates, and each
person, if any, who controls the Company within the meaning of the Securities
Act, and each other person, if any, subject to liability because of his
connection with the Company, against any and all losses, claims, damages,
actions, liabilities, costs and expenses arising out of or based upon (i) any
untrue statement or alleged untrue statement of material fact contained in
either such Registration Statement or the Prospectus contained therein, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, if and to the extent
that such statement or omission occurs from reliance upon and in conformity with
written information regarding the Holder, its plan of distribution or its
ownership interests, which was furnished to the Company by the Holder for use
therein unless such statement or omission was corrected in writing to the
Company not less than three (3) business days prior to the date of the final
prospectus (as supplemented or amended, as the case may be) or (ii) the failure
by the Holder to deliver or cause to be delivered the Prospectus contained in
such Registration Statement (as amended or supplemented if applicable) furnished
by the Company to the Holder to any purchaser of the shares covered by such
Registration Statement from the Holder through no fault of the Company. The
liability of the Holders under the preceding indemnity shall be several and not
joint.
8. Suspension of Registration Requirement: Restriction on Sales.
------------------------------------------------------------
(a) The Company shall promptly notify each Holder of, and confirm
in writing, the issuance by the SEC of any stop order suspending the
effectiveness of a Registration Statement with respect to such Holder's
Registrable Shares or the initiation of any proceedings for that purpose. The
Company shall use its best efforts to obtain the withdrawal of any order
suspending the effectiveness of such a Registration Statement at the earliest
possible moment.
8 of 18
<PAGE>
(b) Notwithstanding anything to the contrary set forth in this
Agreement, the Company's obligation under this Agreement to cause a Registration
Statement and any filings with any state securities commission to become
effective or to amend or supplement a Registration Statement shall be suspended
in the event and during such period as unforeseen circumstances exist (including
without limitation (i) an underwritten primary offering by the Company if the
Company is advised by the underwriters that the sale of Registrable Shares under
the Registration Statement would impair the pricing or commercial practicality
of the primary offering or (ii) pending negotiations relating to, or
consummation of, a transaction or the occurrence of an event that would require
additional disclosure of material information by the Company in the Registration
Statement or such filing, as to which the Company has a bona fide business
purpose for preserving confidentiality or which renders the Company unable to
comply with SEC requirements) (such unforeseen circumstances being hereinafter
referred to as a "Suspension Event") that would make it impractical or
inadvisable to cause the Registration Statement or such filings to become
effective or to amend or supplement the Registration Statement, but any one such
suspension shall continue for not more than 180 consecutive days. The Company
shall notify the Holders of the existence and, in the case of circumstances
referred to in clause (i) of this Section 8(b), nature of any Suspension Event.
(c) Each Holder of Registrable Shares agrees, if requested by the
Company in the case of a Company-initiated non-underwritten offering, or if
requested by the managing underwriter or underwriters in a Company-initiated
underwritten offering, not to effect any public sale or distribution of any of
the securities of the Company, including a sale pursuant to Rule 144, during the
15-day period prior to, and during the 60-day period beginning on, the date of
effectiveness of the registration statement relating to such Company-initiated
offering.
9. Black-Out Period.
----------------
Each Holder agrees that, following the effectiveness of any Registration
Statement (except an Issuance Registration Statement) relating to Registrable
Shares of such Holder, such Holder will not effect any sales of the Registrable
Shares pursuant to the Registration Statement or any filings with any state
Securities Commission at any time after such Holder has received notice from the
Company to suspend sales as a result of the occurrence or existence of any
Suspension Event or so that the Company may correct or update the Registration
Statement or such filing. The Holder may recommence effecting sales of the
Shares pursuant to the Registration Statement or such filings following further
notice to such effect from the Company, which notice shall be given by the
Company not later than five (5) business days after the conclusion of any such
Suspension Event.
10. Additional Shares.
-----------------
The Company, at its option, may register, under any Registration Statement
and any filings with any state securities commissions filed pursuant to this
Agreement, any number of unissued Common Shares of the Company or any Common
Shares of the Company owned by any other shareholder or shareholders of the
Company.
9 of 18
<PAGE>
11. Contribution.
------------
If the indemnification provided for in Sections 6 and 7 is unavailable to
an indemnified party with respect to any losses, claims, damages, actions,
liabilities, costs or expenses referred to therein or is insufficient to hold
the indemnified party harmless as contemplated therein, then the indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages, actions, liabilities, costs or expenses in such proportion as
is appropriate to reflect the relative fault of the Company, on the one hand,
and the Indemnitee, on the other hand, in connection with the statements or
omissions which resulted in such losses, claims, damages, actions, liabilities,
costs or expenses as well as any other relevant equitable considerations. The
relative fault of the Company, on the one hand, and of the Indemnitee, on the
other hand, shall be determined by reference to, among other factors, whether
the untrue or alleged untrue statement of a material fact or omission to state a
material fact relates to information supplied by the Company or by the
Indemnitee and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission; provided,
--------
however, that in no event shall the obligation of any indemnifying party to
- -------
contribute under this Section 11 exceed the amount that such indemnifying party
would have been obligated to pay by way of indemnification if the
indemnification provided for under Sections 6 or 7 hereof had been available
under the circumstances.
The Company and the Holders agree that it would be just and equitable if
contribution pursuant to this Section 11 were determined by pro rata allocation
--------
or by any other method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 11, no Holder shall be
required to contribute any amount in excess of the amount by which the gross
proceeds from the sale of Shares exceeds the amount of any damages that the
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission. No indemnified party guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any indemnifying party who was not guilty
of such fraudulent misrepresentation.
12. No Other Obligation to Register.
-------------------------------
Except as otherwise expressly provided in this Agreement, the Company shall
have no obligation to the Holders to register the Registrable Shares under the
Securities Act.
13. Amendments and Waivers.
----------------------
The provisions of this Agreement may not be amended, modified, or
supplemented or waived without the prior written consent of the Company and
Holders holding in excess of two-thirds of the aggregate of all Shares and Units
held by Holders.
14. Notices.
-------
Except as set forth below, all notices and other communications provided
for or permitted hereunder shall be in writing and shall be deemed to have been
duly given if delivered personally or sent by telex or telecopier, registered or
certified mail (return receipt requested), postage
10 of 18
<PAGE>
prepaid or courier or overnight delivery service to the respective parties at
the following addresses (or at such other address for any party as shall be
specified by like notice, provided that notices of a change of address shall be
effective only upon receipt thereof), and further provided that in case of
directions to amend the Registration Statement pursuant to Section 3(g) or
Section 7, a Holder must confirm such notice in writing by overnight express
delivery with confirmation of receipt:
If to the Company: Boston Properties, Inc.
500 E Street, SW, Suite 200
Washington, DC 20024
Attn: Raymond A. Ritchey, Senior Vice President
Telecopy: (202) 488-8644
with a copy to: Goodwin, Procter & Hoar LLP
Exchange Place
Boston, MA 02109
Attn: Gilbert G. Menna, P.C.
Telecopy: (617) 523-1231
and with a copy to: Shaw Pittman Potts & Trowbridge
2300 N Street, NW
Washington, DC 20037
Attn: Sheldon J. Weisel, Esq.
Telecopy: (202) 663-8007
If to the Holders: As listed on the applicable Holder Signature Page
with a copy to: Mayer Brown & Platt
190 South LaSalle Street
Chicago, IL 60603
Attn: Alvin C. Katz, Esq.
Telecopy: (312) 706-8714
In addition to the manner of notice permitted above, notices given pursuant to
Sections 3, 8 and 9 hereof may be effected telephonically and confirmed in
writing thereafter in the manner described above.
15. Successors and Assigns.
----------------------
This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the parties
hereto and their respective successors and assigns, including without limitation
subsequent Holders. If any successor, assignee or transferee of any Holder
shall acquire Registrable Securities in any manner, whether by operation of law
or otherwise, such Registrable Securities shall be held subject to all of the
terms of this Agreement, and by taking and holding Registrable Securities such
Person shall be conclusively deemed to have agreed to be bound by all of the
terms and provision hereof. Each Holder agrees that (i) it shall only Dispose
of Units to persons who are "accredited investors" within the meaning of
Regulation D of the Securities Act and (ii) it shall promptly notify the Company
of any such Disposition. Each transferee, successor or assignee shall sign a
counterpart signature page to this Agreement.
11 of 18
<PAGE>
16. Counterparts.
------------
This Agreement may be executed in any number of counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement.
17. Governing Law.
-------------
This Agreement shall be governed by and construed in accordance with the
laws of the State of Delaware applicable to contracts made and to be performed
wholly within said State.
18. Severability.
------------
In the event that any one or more of the provisions contained herein, or
the application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be in any way impaired thereby, it being
intended that all of the rights and privileges of the parties hereto shall be
enforceable to the fullest extent permitted by law.
19. Entire Agreement.
----------------
This Agreement is intended by the parties as a final expression of their
agreement and intended to be the complete and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein, with respect to
such subject matter. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
BOSTON PROPERTIES, INC.,
a Delaware corporation
By: /s/ Raymond A. Ritchey
Name: Raymond A. Ritchey
Title: Executive Vice President
[ADDITIONAL EXECUTION PAGES FOLLOW]
12 of 18
<PAGE>
[Additional Execution Page for
Registration Rights and Lock-Up Agreement
Dated May 28, 1998]
/s/ Amy S. Rubenstein
Amy S. Rubenstein
2814 Dumbarton Street, NW
Washington, DC 20007
13 of 18
<PAGE>
[Additional Execution Page for
Registration Rights and Lock-Up Agreement
Dated May 28, 1998]
/s/ Beth Dana Rubenstein
Beth Dana Rubenstein
451 29th Street
San Francisco, CA 94131
14 of 18
<PAGE>
[Additional Execution Page for
Registration Rights and Lock-Up Agreement
Dated May 28, 1998]
/s/ Barton S. Rubenstein
Barton S. Rubenstein
4003 Underwood Street
Chevy Chase, MD 20815
15 of 18
<PAGE>
[Additional Execution Page for
Registration Rights and Lock-Up Agreement
Dated May 28, 1998]
LISHIL ENTERPRISES LIMITED PARTNERSHIP,
a District of Columbia limited partnership
By: ASR - 77 SECURITIES, INC.,
a District of Columbia corporation,
General Partner
By: /s/ Stephen A. Bodzin
Print Name: Stephen A. Bodzin
Title: Secretary
Address: 1156 15th Street, NW
Suite 329
Washington, DC 20005
Attn: Stephen A. Bodzin
16 of 18
<PAGE>
[Additional Execution Page for
Registration Rights and Lock-Up Agreement
Dated May 28, 1998]
DAWSON ENTERPRISES LIMITED PARTNERSHIP, a
Maryland limited partnership
By: /s/ Beverly B. Bernstein
Print Name: Beverly B. Bernstein
Title: General Partner
Address: 3248 N Street, NW
Washington, DC 20007
Attn: Beverly B. Bernstein
17 of 18
<PAGE>
[Additional Execution Page for
Registration Rights and Lock-Up Agreement
Dated May 28, 1998]
TOWER CAPITAL, LLC, a Maryland limited
liability company
By: /s/ Gary M. Abramson
Print Name: Gary M. Abramson
Title: Manager
Address: 11501 Huff Court
North Bethesda, MD 20895
Attn: Gary M. Abramson
18 of 18
