<PAGE> 1
As filed with the Securities and Exchange Commission on August 6, 1997
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): AUGUST 5, 1997
EQUITY OFFICE PROPERTIES TRUST
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
MARYLAND 1-13115 36-4151656
(STATE OR OTHER JURISDICTION (COMMISSION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) FILE NUMBER) IDENTIFICATION NO.)
TWO NORTH RIVERSIDE PLAZA, SUITE 2200
CHICAGO, ILLINOIS 60606
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
Registrant's telephone number, including area code: (312) 466-3300
NOT APPLICABLE
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
===============================================================================
<PAGE> 2
ITEM 5. Other Events
On August 5 and 6, 1997, Equity Office Properties Trust (the "Company")
issued the following press releases:
FOR IMMEDIATE RELEASE:
CHICAGO, ILLINOIS (AUGUST 5, 1997) ATTACHED ARE TWO ANNOUNCEMENTS MADE TODAY BY
EQUITY OFFICE PROPERTIES TRUST (NYSE:EOP):
EQUITY OFFICE PROPERTIES TRUST TO ACQUIRE ELEVEN PROPERTIES FOR $144.7 MILLION
FROM ACORN DEVELOPMENT CORPORATION
EQUITY OFFICE PROPERTIES TRUST TO ACQUIRE TWO OFFICE BUILDINGS AND GARAGE IN
NEW ORLEANS FOR $140 MILLION
PLEASE CONTACT THE ABOVE IF YOU DO NOT RECEIVE BOTH RELEASES.
###
[EQUITY OFFICE LETTERHEAD]
FOR IMMEDIATE RELEASE
EQUITY OFFICE PROPERTIES TRUST TO ACQUIRE TWO OFFICE BUILDINGS AND GARAGE
IN NEW ORLEANS FOR $140 MILLION
CHICAGO, ILLINOIS (August 5, 1997) - Equity Office Properties Trust (NYSE:EOP)
today announced that it has entered into a definitive agreement to acquire two
office buildings and a parking facility in New Orleans, Louisiana from Columbus
American Properties, L.L.C. The purchase price is $140 million, of which $91
million is debt to be assumed by Equity Office and $49 million will be paid in
EOP Operating Limited Partnership units at a price of $29 per unit.
The two buildings are LL&E Tower, a 36-story, 545,000-square-foot office
building, and Texaco Center, a 32-story 588,700-square-foot office tower. The
proposed acquisition also includes 601 Tchoupitoulas Garage, a 9.5 story
parking facility with 766 parking spaces. All three are centrally located in
downtown New Orleans. The office buildings are each currently 82% leased.
Equity Office anticipates that this portfolio will generate a GAAP NOI yield in
excess of 9% in 1998 and a stabilized yield of approximately 10% in 1999.
"This acquisition of these premier assets will greatly expand Equity
Office's presence in New Orleans," said Timothy H. Callahan, president and chief
executive officer of Equity Office. "We believe LL&E Tower is the finest
building in New Orleans in physical quality as well as the premier office
address in the heart of the business district. Texaco Center is ideally located
adjacent to the Federal Government complex and is home to the eastern U.S.
headquarters of Texaco, Inc., which recently renewed their lease for a 10-year
term, sharing our long-term optimism about the New Orleans business climate."
Equity Office currently owns approximately 1.2 million square feet of
office space in Metairie, Louisiana at Lakeway Center One, Two and Three. With
the acquisition of LL&E Tower and Texaco Center, Equity Office would own and
operate 2.3 million square feet in five buildings in the New Orleans
metropolitan area.
Certain matters discussed within this press release may be deemed to be
forward looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Although Equity Office Properties Trust believes
the expectations reflected in such forward looking statements are based on
reasonable assumptions, it can give no assurance that its expectations will be
attained. Factors that could cause actual results to differ materially from
Equity Office's expectations include real estate conditions, information
determined in the course of due diligence review, changes in local or national
economic conditions and other risks detailed from time to time in the company's
SEC reports and filings, including its S-11 Registration Statement as well as
quarterly reports on Form 10-Q, reports on Form 8-K and annual reports on Form
10-K. The Company assumes no obligation to update or supplement forward looking
statements that become untrue because of subsequent events.
Because the described transaction is subject to satisfactory completion of
due diligence and documentation, there can be no assurance at this time that
EOP will ultimately acquire any of these assets.
Equity Office Properties Trust is the nation's largest publicly-traded
office building company. It owns and operates a portfolio of 90 office
buildings representing 32.2 million square feet of office space in 20 states
and the District of Columbia, and owns 14 stand-alone parking facilities. Upon
completion of the Columbus American transaction and another announced
transaction that is also anticipated but not yet completed, Equity Office would
own and operate 103 buildings in these same states, representing 34.4 million
square feet and 15 parking facilities.
# # #
FOR IMMEDIATE RELEASE
EQUITY OFFICE PROPERTIES TRUST TO ACQUIRE ELEVEN PROPERTIES
FOR $144.7 MILLION FROM ACORN DEVELOPMENT CORPORATION
ACQUISITION TO ADD 1.0 MILLION SQUARE FEET IN SUBURBAN PHILADELPHIA
CHICAGO, ILLINOIS (August 5, 1997) - Equity Office Properties Trust (NYSE:EOP)
today announced that its Board of Trustees has approved the acquisition of a
portfolio of eleven office properties in suburban Philadelphia, Pennsylvania
from affiliates of the Acorn Development Corporation, subject to completion of
due diligence and satisfactory documentation. The purchase price is $144.7
million, to be paid in a combination of cash, an aggregate of approximately $20
million of EOP Operating Limited Partnership units at a price of $28.775 per
unit, and the assumption of debt.
The eleven properties total approximately 1.0 million square feet of
office space. The majority are located in the three dominant suburban
Philadelphia submarkets: King of Prussia, Conshohocken/Radnor and Plymouth
Meeting/Blue Bell. "This acquisition will provide Equity Office with an
immediate and significant presence in the suburban Philadelphia market and is
an excellent complement to our existing downtown Philadelphia presence at 1601
Market," said Timothy H. Callahan, president and chief executive officer of
Equity Office Properties Trust. "Suburban Philadelphia is an excellent market,
with a vacancy rate of less than 8% and supply constrained due to the limited
availability of developable sites in these markets."
Average occupancy for the properties is 98.7%. The cash portion of the
acquisition will be funded through Equity Office's working capital and line of
credit. The Company anticipates that this portfolio will generate a GAAP NOI
yield in excess of 10% in 1998.
Equity Office currently owns and operates 1601 Market, a
681,289-square-foot office tower in downtown Philadelphia. "This acquisition
would greatly enhance our strategic ability to serve the full range of office
customers throughout the Philadelphia area," said Mr. Callahan.
Certain matters discussed within this press release may be deemed to be
forward looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Although Equity Office Properties Trust believes
the expectations reflected in such forward looking statements are based on
reasonable assumptions, it can give no assurance that its expectations will be
attained. Factors that could cause actual results to differ materially from
Equity Office's expectations include real estate conditions, information
determined in the course of due diligence review, changes in local or national
economic conditions and other risks detailed from time to time in the company's
SEC reports and filings, including its S-11 Registration Statement as well as
quarterly reports on Form 10-Q, reports on Form 8-K and annual reports on Form
10-K. The Company assumes no obligation to update or supplement forward looking
statements that become untrue because of subsequent events.
Because the described transaction is subject to satisfactory completion of
due diligence and documentation, there can be no assurance at this time that
EOP will ultimately acquire any of these assets.
Equity Office Properties Trust is the nation's largest publicly-traded
office building company. It owns and operates a portfolio of 90 buildings
representing 32.2 million square feet of office space in 20 states and the
District of Columbia, and owns 14 stand-alone parking facilities. Upon
completion of the Acorn transaction and another announced transaction that is
also anticipated but not yet completed, Equity Office would own and operate 103
buildings in these same states, representing 34.4 million square feet and 15
parking facilities.
# # #
Chart of buildings:
<TABLE>
<CAPTION>
NAME: LOCATION SQ. FT. OCCUPANCY
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
Four Falls Corporate Center Conshohocken,PA 254,355 99.0%
Oak Hill Plaza King of Prussia, PA 165,575 100.0%
Walnut Hill Plaza King of Prussia, PA 149,716 97.0%
One Valley Square Plymouth Meeting, PA 70,289 100.0%
Two Valley Square Plymouth Meeting, PA 70,530 100.0%
Three Valley Square Plymouth Meeting, PA 84,865 97.7%
Four Valley Square Plymouth Meeting, PA 49,757 100.0%
Five Valley Square Plymouth Meeting, PA 18,511 100.0%
One Devon Square Wayne, PA 77,630 100.0%
Two Devon Square Wayne, PA 63,226 90.0%
Three Devon Square Wayne, PA 6,000 100.0%
- --------------------------------------------------------------------------------------------------
Total 1,010,454 98.7%
</TABLE>
# # #
NEWS RELEASE
Equity Office (Media): Equity Office (Analysts): Prudential:
Frances Lewis Diane Morefield Rick Matthews
312.466.4025 312.466.3286 201.802.4874
FOR IMMEDIATE RELEASE
EQUITY OFFICE PROPERTIES TRUST TO ACQUIRE SIX PROPERTIES
FOR $290 MILLION FROM PRUDENTIAL
ACQUISITIONS TO ADD 2.5 MILLION SQUARE FEET IN HOUSTON, DALLAS, AND PHILADELPHIA
PRUDENTIAL TO ACQUIRE 5.92 MILLION COMMON SHARES OF EQUITY OFFICE
CHICAGO, ILLINOIS (August 6, 1997) - Equity Office Properties Trust (NYSE:EOP)
today announced that its Board of Trustees has approved the acquisition of a
portfolio of six office properties totaling approximately 2.5 million square
feet in Houston and Dallas, Texas and Philadelphia, Pennsylvania from The
Prudential Insurance Company of America, subject to completion of due
diligence, satisfactory documentation and Prudential approvals. The purchase
price is $290 million.
In a separate transaction, Prudential will purchase $145 million in
restricted common shares of Equity Office Properties Trust at $24.50 per share.
The stock purchase may include an investment made on behalf of one or more
institutional clients, as well as Prudential's own General Account.
The six properties are Destec Tower, a 25-story, 573,456-square-foot
office tower in the Westchase area of Houston; Brookhollow Central I, II, and
III, a 795,455-square-foot office complex in suburban Houston; 8080 Central, a
17-story, 283,707-square-foot office building in the North Central Expressway
submarket of Dallas; and 1700 Market, a 32-story, 840,908-square-foot office
building in the Market Street West area of downtown Philadelphia. Average
occupancy for the entire portfolio is 86.5%. Equity Office anticipates that
this portfolio will generate a GAAP NOI yield of approximately 9% in 1998. The
acquisition will be financed through the Company's unsecured line of credit and
working capital.
"These properties add to our critical mass in Houston, Dallas, and
Philadelphia, where we already have a significant presence," said Timothy H.
Callahan, president and chief executive officer of Equity Office Properties
Trust. "Each furthers our strategic goals of serving our office customer base
throughout a key metropolitan area, and immediately creates the opportunity for
operating efficiencies in conjunction with our established presence in these
markets."
Mr. Callahan also said, "This acquisition additionally represents the
opportunity to acquire a large portfolio with an institutional investor who
shares our long-term belief in our company. We welcome the opportunity to
partner with Prudential."
Equity Office currently owns 1.36 million square feet in Houston in the
San Felipe Plaza, Intercontinental Center, and Northborough Tower buildings.
Upon completion of the proposed transaction, Equity Office will own and operate
2.73 million square feet in seven buildings in the Houston metropolitan area.
"We are building critical mass in Houston, a market with good job growth," said
Mr. Callahan. "Destec Tower is generally acknowledged as the premier building
west of the Galleria. Brookhollow is a high visibility, stable complex
strategically located at the confluence of three major highways that enables us
to serve a full range of tenant needs in this market."
Currently, Equity Office's Dallas portfolio includes seven buildings
with 1.84 million square feet, including Four Forest, North Central Plaza
Three, 9400 NCX , Sterling Plaza, and the Preston Commons complex. "8080
Central is one of the finest buildings in the North Central Expressway
submarket and an excellent strategic fit with our existing Dallas properties,
in particular 9400 NCX. This acquisition will further enhance our goal of
building a significant market presence in the key Dallas office market," said
Mr. Callahan. The completion of the acquisition of 8080 Central will increase
Equity Office's total square footage in Dallas to 2.13 million in eight
buildings.
Equity Office currently owns 1601 Market, a 681,289-square-foot office
tower in downtown Philadelphia. This acquisition would increase Equity's total
square footage in the CBD to 1.52 million square feet. "1700 Market, in an A+
location, is highly complementary with 1601 Market and would substantially
contribute to our ability to generate operating efficiencies and better serve
customers in this market," said Mr. Callahan. Equity Office additionally owns
five stand-alone parking facilities in downtown Philadelphia.
Certain matters discussed within this press release may be deemed to be
forward looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Although Equity Office Properties Trust believes
the expectations reflected in such forward looking statements are based on
reasonable assumptions, it can give no assurance that its expectations will be
attained. Factors that could cause actual results to differ materially from
Equity Office's expectations include real estate conditions, information
determined in the course of due diligence review, changes in local or national
economic conditions and other risks detailed from time to time in the company's
SEC reports and filings, including its S-11 Registration Statement as well as
quarterly reports on Form10-Q, reports on Form 8-K and annual reports on Form
10-K. The Company assumes no obligation to update or supplement forward looking
statements that become untrue because of subsequent events.
Because the described transaction is subject to satisfactory completion of
due diligence and documentation, there can be no assurance at this time that
EOP will ultimately acquire any of these assets.
Equity Office Properties Trust is the nation's largest publicly-traded
office building company. It owns and operates a portfolio of 90 buildings
representing 32.2 million square feet of office space in 20 states and the
District of Columbia, and owns 14 stand-alone parking facilities. Upon
completion of the Prudential transaction and two other announced transactions
that are also anticipated but not yet completed, Equity Office would own and
operate 109 buildings in these same states, representing 36.8 million square
feet and 15 parking facilities.
# # #
Property chart:
<TABLE>
<CAPTION>
NAME LOCATION SQ. FT. FLOORS OCCUPANCY
- ------------------------- ------------------------- ------- ---------
<S> <C> <C> <C>
Destec Tower Houston, TX 573,456 25 95.6%
Brookhollow I, II and III Houston, TX 795,455 11 - 14 88.9%
8080 Central Dallas, TX 283,707 17 84.9%
1700 Market Philadelphia, PA 840,908 32 78.7%
--------- ---------
Total 2,493,526 86.5%
</TABLE>
# # #
2
<PAGE> 3
<TABLE>
<CAPTION>
Exhibit
Number Exhibit
------- -------
<S> <C>
3.1 Articles of Amendment and Restatement of Declaration of
Trust of the Registrant.
3.2 Bylaws of the Registrant
</TABLE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
EQUITY OFFICE PROPERTIES TRUST
Date: August 6, 1997 By: /s/ Stanley M. Stevens
----------------------------
Stanley M. Stevens
Executive Vice President,
Chief Legal Counsel and
Secretary
3
<PAGE> 1
EXHIBIT 3.1
EQUITY OFFICE PROPERTIES TRUST
The total number of shares of beneficial interest which the Trust had
authority to issue immediately prior to this amendment and restatement was 850
million, consisting of 750 million common shares of beneficial interest, $0.01
par value per share and 100 million preferred shares of beneficial interest,
$0.01 par value per share. The aggregate par value of all authorized shares of
beneficial interest having par value was $8.5 million.
ARTICLES OF AMENDMENT AND RESTATEMENT OF DECLARATION OF TRUST
Equity Office Properties Trust, a Maryland real estate investment trust
(the "Trust") under Title 8 of the Corporations and Associations Article of the
Annotated Code of Maryland ("Title 8"), desires to amend and restate its
Declaration of Trust as currently in effect and as hereinafter amended (as so
amended and restated, the "Declaration of Trust"). The following provisions
are all the provisions of the Declaration of Trust currently in effect and as
hereinafter amended:
ARTICLE I
FORMATION
The Trust is a real estate investment trust within the meaning of Title 8.
The Trust shall not be deemed to be a general partnership, limited
partnership, joint venture, joint stock company or a corporation (but nothing
herein shall preclude the Trust from being treated for tax purposes as an
association under the Code).
ARTICLE II
NAME
The name of the Trust is: Equity Office Properties Trust.
Under circumstances in which the Board of Trustees of the Trust (the
"Board of Trustees" or "Board") determines that the use of the name of the
Trust is not practicable, the Trust may use any other designation or name for
the Trust.
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<PAGE> 2
ARTICLE III
PURPOSES AND POWERS
Section 3.1 Purposes. The purposes for which the Trust is formed are to
invest in and to acquire, hold, manage, administer, control and dispose of
property, including, without limitation or obligation, engaging in business as
a real estate investment trust under the Internal Revenue Code of 1986, as
amended (the "Code").
Section 3.2 Powers. The Trust shall have all of the powers granted to
real estate investment trusts by Title 8 and all other powers set forth in the
Declaration of Trust which are not inconsistent with law and are appropriate to
promote and attain the purposes set forth in the Declaration of Trust.
ARTICLE IV
RESIDENT AGENT
The name of the resident agent of the Trust in the State of Maryland is
James J. Hanks, Jr., whose post office address is c/o Ballard Spahr Andrews &
Ingersoll, 300 East Lombard Street, Baltimore, Maryland 21202. The resident
agent is a citizen of and resides in the State of Maryland. The Trust may have
such offices or places of business within or outside the State of Maryland as
the Board of Trustees may from time to time determine.
ARTICLE V
BOARD OF TRUSTEES
Section 5.1 Powers. Subject to any express limitations contained in the
Declaration of Trust or in the Bylaws, (a) the business and affairs of the
Trust shall be managed under the direction of the Board of Trustees (sometimes
hereinafter the "Board") and (b) the Board shall have full, exclusive and
absolute power, control and authority over any and all property of the Trust.
The Board may take any action as in its sole judgment and discretion is
2
<PAGE> 3
necessary or appropriate to conduct the business and affairs of the Trust. The
Declaration of Trust shall be construed with the presumption in favor of the
grant of power and authority to the Board. Any construction of the Declaration
of Trust or determination made in good faith by the Board concerning its powers
and authority hereunder shall be conclusive. The enumeration and definition of
particular powers of the Trustees included in the Declaration of Trust or in
the Bylaws shall in no way be limited or restricted by reference to or
inference from the terms of this or any other provision of the Declaration of
Trust or the Bylaws or construed or deemed by inference or otherwise in any
manner to exclude or limit the powers conferred upon the Board or the Trustees
under the general laws of the State of Maryland or any other applicable laws.
The Board, without any action by the shareholders of the Trust, shall have
and may exercise, on behalf of the Trust, without limitation, the power to
determine that compliance with any restriction or limitations on ownership and
transfers of shares of the Trust's beneficial interest set forth in Article VII
of the Declaration of Trust is no longer required in order for the Trust to
qualify as a REIT; to adopt Bylaws of the Trust, which may thereafter be
amended or repealed as provided therein; to elect officers in the manner
prescribed in the Bylaws; to solicit proxies from holders of shares of
beneficial interest of the Trust; and to do any other acts and deliver any
other documents necessary or appropriate to the foregoing powers.
Section 5.2 Number and Classification. The number of Trustees
(hereinafter the "Trustees") shall initially be three, shall be increased to
nine within 90 days following closing of the Trust's initial public offering of
Shares (as hereinafter defined), and shall not thereafter be decreased, but may
be increased to a maximum of fifteen pursuant to the Bylaws of the Trust.
Notwithstanding the foregoing, if for any reason any or all of the Trustees
cease to be Trustees, such event shall not terminate the Trust or affect the
Declaration of Trust or the powers of the remaining Trustees. The Trustees
shall be elected by the shareholders at every third annual meeting thereof in
the manner provided in the Bylaws or, in order to fill any vacancy on the Board
3
<PAGE> 4
of Trustees, in the manner provided in the Bylaws. The names and addresses of
the initial three Trustees, who shall serve until the first annual meeting of
shareholders and until their successors are duly elected and qualify, or until
such later time as determined by the Board of Trustees as hereinafter provided,
are:
<TABLE>
<CAPTION>
NAME ADDRESS
---- -------
<S> <C>
SAMUEL ZELL C/O EQUITY GROUP INVESTMENTS, INC.
TWO NORTH RIVERSIDE PLAZA, SUITE 600
CHICAGO, IL 60606
SHELI Z. ROSENBERG C/O EQUITY GROUP INVESTMENTS, INC.
TWO NORTH RIVERSIDE PLAZA, SUITE 600
CHICAGO, IL 60606
TIMOTHY H. CALLAHAN C/O EQUITY OFFICE PROPERTIES TRUST
TWO NORTH RIVERSIDE PLAZA, SUITE 2200
CHICAGO, IL 60606
</TABLE>
These Trustees may increase the number of Trustees and fill any vacancy,
whether resulting from an increase in the number of Trustees or otherwise, on
the Board of Trustees, and classify the Trustees (other than any Trustee
elected solely by holders of one or more classes or series of Preferred Shares)
with respect to the terms for which they severally hold office, into three
classes, as nearly equal in number as possible, one class to hold office
initially for a term expiring at the next succeeding annual meeting of
shareholders, another class to hold office initially for a term expiring at the
second succeeding annual meeting of shareholders and another class to hold
office initially for a term expiring at the third succeeding annual meeting of
shareholders, with the Trustees of each class to hold office until their
successors are duly elected and qualify. At each annual meeting of
shareholders, the successors to the class of Trustees whose term expires at
such meeting shall be elected to hold office for a term expiring at the annual
meeting of shareholders held in the third year following the year of their
election. Election of Trustees by shareholders shall require the vote and be
in accordance with the procedures set forth in the Bylaws.
4
<PAGE> 5
It shall not be necessary to list in the Declaration of Trust the names
and addresses of any Trustees hereinafter elected.
Section 5.3 Resignation, Removal or Death. Any Trustee may resign by
written notice to the Board, effective upon execution and delivery to the Trust
of such written notice or upon any future date specified in the notice.
Subject to the rights of holders of one or more classes or series of Preferred
Shares, as hereinafter defined, to elect one or more Trustees, a Trustee may be
removed at any time, only with cause, at a meeting of the shareholders, by the
affirmative vote of the holders of not less than a majority of the Shares then
outstanding and entitled to vote generally in the election of Trustees.
ARTICLE VI
SHARES OF BENEFICIAL INTEREST
Section 6.1 Authorized Shares. The beneficial interest of the Trust
shall be divided into shares of beneficial interest (the "Shares"). The Trust
has authority to issue 750 million common shares of beneficial interest, $.01
par value per share ("Common Shares"), and 100 million preferred shares of
beneficial interest, $.01 par value per share ("Preferred Shares"). The Board
of Trustees, with the approval of the shareholders of the Trust by a majority
of the votes cast at a meeting of shareholders duly called and at which a
quorum is present, may amend the Declaration of Trust from time to time to
increase or decrease the aggregate number of Shares or the number of Shares of
any class that the Trust has authority to issue.
Section 6.2 Common Shares. Subject to the provisions of Article VII,
each Common Share shall entitle the holder thereof to one vote on each matter
upon which holders of Common Shares are entitled to vote. The Board of Trustees
may reclassify any unissued Common Shares from time to time in one or more
classes or series of Shares.
Section 6.3 Preferred Shares. The Board of Trustees may classify any
unissued Preferred Shares and reclassify any previously classified but unissued
Preferred Shares of any
5
<PAGE> 6
series from time to time, in one or more series of Shares.
Section 6.4 Classified or Reclassified Shares. Prior to issuance of
classified or reclassified Shares of any class or series, the Board of Trustees
by resolution shall (a) designate that class or series to distinguish it from
all other classes and series of Shares; (b) specify the number of Shares to be
included in the class or series; (c) set, subject to the provisions of Article
VII and subject to the express terms of any class or series of Shares
outstanding at the time, the preferences, conversion or other rights, voting
powers, restrictions, limitations as to dividends or other distributions,
qualifications and terms and conditions of redemption for each class or series;
and (d) cause the Trust to file articles supplementary with the State
Department of Assessments and Taxation of Maryland (the "SDAT"). Any of the
terms of any class or series of Shares set pursuant to clause (c) of this
Section 6.4 may be made dependent upon facts ascertainable outside the
Declaration of Trust (including the occurrence of any event, including a
determination or action by the Trust or any other person or body) and may vary
among holders thereof, provided that the manner in which such facts or
variations shall operate upon the terms of such class or series of Shares is
clearly and expressly set forth in the articles supplementary filed with the
SDAT.
Section 6.5 Authorization by Board of Share Issuance. The Board of
Trustees may authorize the issuance from time to time of Shares of any class or
series, whether now or hereafter authorized, or securities or rights
convertible into Shares of any class or series, whether now or hereafter
authorized, for such consideration (whether in cash, property, past or future
services, obligation for future payment or otherwise) as the Board of Trustees
may deem advisable (or without consideration in the case of a Share split or
Share dividend), subject to such restrictions or limitations, if any, as may be
set forth in the Declaration of Trust or the Bylaws of the Trust.
6
<PAGE> 7
Section 6.6 Dividends and Distributions. The Board of Trustees may
from time to time authorize and declare to shareholders such dividends or
distributions, in cash or other assets of the Trust or in securities of the
Trust or from any other source as the Board of Trustees in its discretion shall
determine. The Board of Trustees shall endeavor to declare and pay such
dividends and distributions as shall be necessary for the Trust to qualify as a
real estate investment trust under the Code; however, shareholders shall have
no right to any dividend or distribution unless and until authorized and
declared by the Board. The exercise of the powers and rights of the Board of
Trustees pursuant to this Section 6.6 shall be subject to the provisions of any
class or series of Shares at the time outstanding. Notwithstanding any other
provision in the Declaration of Trust, no determination shall be made by the
Board of Trustees nor shall any transaction be entered into by the Trust which
would cause any Shares or other beneficial interest in the Trust not to
constitute "transferable shares" or "transferable certificates of beneficial
interest" under Section 856(a)(2) of the Code or which would cause any
distribution to constitute a preferential dividend as described in Section
562(c) of the Code.
Section 6.7 General Nature of Shares. All Shares shall be
personal property entitling the shareholders only to those rights provided in
the Declaration of Trust. The shareholders shall have no interest in the
property of the Trust and shall have no right to compel any partition,
division, dividend or distribution of the Trust or of the property of the
Trust. The death of a shareholder shall not terminate the Trust. The Trust is
entitled to treat as shareholders only those persons in whose names Shares are
registered as holders of Shares on the beneficial interest ledger of the Trust.
Section 6.8 Fractional Shares. The Trust may, without the consent or
approval of any shareholder, issue fractional Shares, eliminate a fraction of
a Share by rounding up or down to a full Share, arrange for the disposition of
a fraction of a Share by the person entitled to it, or pay cash for the fair
value of a fraction of a Share.
7
<PAGE> 8
Section 6.9 Declaration and Bylaws. All shareholders are subject to
the provisions of the Declaration of Trust and the Bylaws of the Trust.
Section 6.10 Divisions and Combinations of Shares. Subject to an express
provision to the contrary in the terms of any class or series of beneficial
interest hereafter authorized, the Board of Trustees shall have the power to
divide or combine the outstanding shares of any class or series of beneficial
interest, without a vote of shareholders.
ARTICLE VII
RESTRICTION ON TRANSFER AND OWNERSHIP OF SHARES
Section 7.1 Definitions. For the purpose of this Article VII, the
following terms shall have the following meanings:
Beneficial Ownership. The term "Beneficial Ownership" shall mean
ownership of Shares by a Person, whether the interest in Shares is held
directly or indirectly (including by a nominee), and shall include interests
that would be treated as owned through the application of Section 544 of the
Code, as modified by Section 856(h)(1)(B) of the Code. The terms "Beneficial
Owner," "Beneficially Owns" and "Beneficially Owned" shall have the correlative
meanings.
Business Day. The term "Business Day" shall mean any day, other than a
Saturday or Sunday, that is neither a legal holiday nor a day on which banking
institutions in Chicago, Illinois are authorized or required by law, regulation
or executive order to close.
Charitable Beneficiary. The term "Charitable Beneficiary" shall mean one
or more beneficiaries of the Charitable Trust as determined pursuant to Section
7.3.7, provided that each such organization must be described in Sections
501(c)(3), 170(b)(1)(A) and 170(c)(2) of the Code.
Charitable Trust. The term "Charitable Trust" shall mean any trust
provided for in Section 7.2.1(b)(i) and Section 7.3.1.
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Charitable Trustee. The term "Charitable Trustee" shall mean the Person
unaffiliated with the Trust and a Prohibited Owner, that is appointed by the
Trust to serve as trustee of the Charitable Trust.
Code. The term "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
Constructive Ownership. The term "Constructive Ownership" shall mean
ownership of Shares by a Person, whether the interest in Shares is held
directly or indirectly (including by a nominee), and shall include interests
that would be treated as owned through the application of Section 318(a) of the
Code, as modified by Section 856(d)(5) of the Code. The terms "Constructive
Owner," "Constructively Owns" and "Constructively Owned" shall have the
correlative meanings.
Declaration of Trust. The term "Declaration of Trust" shall mean this
Amended and Restated Declaration of Trust as filed for record with the SDAT,
and any amendments thereto.
Excepted Holder. The term "Excepted Holder" shall mean a shareholder of
the Trust for whom an Excepted Holder Limit is created by the Board of Trustees
pursuant to Section 7.2.7.
Excepted Holder Limit. The term "Excepted Holder Limit" shall mean,
provided that the affected Excepted Holder agrees to comply with the
requirements established by the Board of Trustees pursuant to Section 7.2.7,
and subject to adjustment pursuant to Section 7.2.8, the percentage limit
established by the Board of Trustees pursuant to Section 7.2.7.
Initial Date. The term "Initial Date" shall mean the date upon which this
Amended and Restated Declaration of Trust containing this Article VII is filed
for record with the SDAT.
Market Price. The term "Market Price" on any date shall mean, with
respect to any class or series of outstanding Shares, the Closing Price for
such Shares on such date. The "Closing Price" on any date shall mean the last
sale price for such Shares, regular way, or, in case
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no such sale takes place on such day, the average of the closing bid and asked
prices, regular way, for such Shares, in either case as reported in the
principal consolidated transaction reporting system with respect to securities
listed or admitted to trading on the NYSE or, if such Shares are not listed or
admitted to trading on the NYSE, as reported on the principal consolidated
transaction reporting system with respect to securities listed on the principal
national securities exchange on which such Shares are listed or admitted to
trading or, if such Shares are not listed or admitted to trading on any
national securities exchange, the last quoted price, or, if not so quoted, the
average of the high bid and low asked prices in the over-the-counter market, as
reported by the NASDAQ Stock Market or, if such system is no longer in use, the
principal other automated quotation system that may then be in use or, if such
Shares are not quoted by any such organization, the average of the closing bid
and asked prices as furnished by a professional market maker making a market in
such Shares selected by the Board of Trustees or, in the event that no trading
price is available for such Shares, the fair market value of Shares, as
determined in good faith by the Board of Trustees.
NYSE. The term "NYSE" shall mean the New York Stock Exchange, Inc.
Ownership Limit. The term "Ownership Limit" shall mean (i) with respect
to the Common Shares, 9.9% (in value or number of shares, whichever is more
restrictive) of the outstanding Common Shares of the Trust; and (ii) with
respect to any class or series of Preferred Shares, 9.9% (in value or number of
Shares, whichever is more restrictive) of the outstanding shares of such class
or series of Preferred Shares of the Trust.
Person. The term "Person" shall mean an individual, corporation,
partnership, estate, trust (including a trust qualified under Sections 401(a)
or 501(c)(17) of the Code), a portion of a trust permanently set aside for or
to be used exclusively for the purposes described in Section 642(c) of the
Code, association, private foundation within the meaning of Section 509(a) of
the Code, joint stock company or other entity and also includes a group as that
term is used for
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purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended.
Prohibited Owner. The term "Prohibited Owner" shall mean, with respect to
any purported Transfer, any Person who, but for the provisions of Section
7.2.1, would Beneficially Own or Constructively Own Shares, and if appropriate
in the context, shall also mean any Person who would have been the record owner
of Shares that the Prohibited Owner would have so owned.
REIT. The term "REIT" shall mean a real estate investment trust within
the meaning of Section 856 of the Code.
Restriction Termination Date. The term "Restriction Termination Date"
shall mean the first day after the Initial Date on which the Board of Trustees
determines that it is no longer in the best interests of the Trust to attempt
to, or continue to, qualify as a REIT or that compliance with the restrictions
and limitations on Beneficial Ownership, Constructive Ownership and Transfers
of Shares set forth herein is no longer required in order for the Trust to
qualify as a REIT.
SDAT. The term "SDAT" shall mean the State Department of Assessments and
Taxation of Maryland.
Transfer. The term "Transfer" shall mean any issuance, sale, transfer,
gift, assignment, devise or other disposition, as well as any other event that
causes any Person to acquire Beneficial Ownership or Constructive Ownership, or
any agreement to take any such actions or cause any such events, of Shares or
the right to vote or receive dividends on Shares, including (a) a change in the
capital structure of the Trust, (b) a change in the relationship between two or
more Persons which causes a change in ownership of Shares by application of
Section 544 of the Code, as modified by Section 856(h), (c) the granting or
exercise of any option or warrant (or any disposition of any option or
warrant), pledge, security interest, or similar right to acquire Shares, (d)
any disposition of any securities or rights convertible into or exchangeable
for
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Shares or any interest in Shares or any exercise of any such conversion or
exchange right and (e) Transfers of interests in other entities that result in
changes in Beneficial or Constructive Ownership of Shares; in each case,
whether voluntary or involuntary, whether owned of record, Constructively
Owned or Beneficially Owned and whether by operation of law or otherwise.
(For purposes of this Article VII, the right of a limited partner in EOP
Operating Limited Partnership, a Delaware limited partnership, to require the
partnership to redeem such limited partner's units of partnership interest
pursuant to Section 8.6 of the Agreement of Limited Partnership of EOP
Operating Limited Partnership shall not be considered to be an option or
similar right to acquire Shares of the Trust.) The terms "Transferring" and
"Transferred" shall have the correlative meanings.
Section 7.2 Shares.
Section 7.2.1 Ownership Limitations. During the period
commencing on the Initial Date and prior to the Restriction Termination Date:
(a) Basic Restrictions.
(i) (1) No Person, other than an Excepted Holder,
shall Beneficially Own or Constructively Own Shares in excess of the Ownership
Limit and (2) no Excepted Holder shall Beneficially Own or Constructively Own
Shares in excess of the Excepted Holder Limit for such Excepted Holder.
(ii) No Person shall Beneficially or Constructively
Own Shares to the extent that (1) such Beneficial Ownership of Shares would
result in the Trust being "closely held" within the meaning of Section 856(h)
of the Code (without regard to whether the ownership interest is held during
the last half of a taxable year), or (2) such Beneficial or Constructive
Ownership of Shares would result in the Trust otherwise failing to qualify as a
REIT (including, but not limited to, Constructive Ownership that would result
in the Trust owning (actually or Constructively) an interest in a tenant that
is described in Section 856(d)(2)(B) of the
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Code if the income derived by the Trust from such tenant would cause the Trust
to fail to satisfy any of the gross income requirements of Section 856(c) of
the Code).
(iii) No Person shall Transfer any Shares if, as a
result of the Transfer, the Shares would be beneficially owned by less than
100 Persons (determined without reference to the rules of attribution under
Section 544 of the Code). Subject to Section 7.4 and notwithstanding any other
provisions contained herein, any Transfer of Shares (whether or not such
Transfer is the result of a transaction entered into through the facilities of
the NYSE or any other national securities exchange or automated inter-dealer
quotation system) that, if effective, would result in Shares being beneficially
owned by less than 100 Persons (determined under the principles of Section
856(a)(5) of the Code) shall be void ab initio, and the intended transferee
shall acquire no rights in such Shares.
(b) Transfer in Trust. If any Transfer of Shares
(whether or not such Transfer is the result of a transaction entered into
through the facilities of the NYSE or any other national securities exchange
or automated inter-dealer quotation system) occurs which, if effective, would
result in any Person Beneficially Owning or Constructively Owning Shares in
violation of Section 7.2.1(a)(i) or (ii),
(i) then that number of Shares the Beneficial or
Constructive Ownership of which otherwise would cause such Person to violate
Section 7.2.1(a)(i) or (ii)(rounded to the nearest whole share) shall be
automatically transferred to a Charitable Trust for the benefit of a
Charitable Beneficiary, as described in Section 7.3, effective as of the close
of business on the Business Day prior to the date of such Transfer, and such
Person shall acquire no rights in such Shares; or
(ii) if the transfer to the Charitable Trust
described in clause (i) of this sentence would not be effective for any reason
to prevent the violation of Section 7.2.1(a)(i) or (ii), then the Transfer of
that number of Shares that otherwise would cause
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any Person to violate Section 7.2.1(a)(i) or (ii) shall be void ab initio,
and the intended transferee shall acquire no rights in such Shares.
Section 7.2.2 Remedies for Breach. If the Board of Trustees or any duly
authorized committee thereof shall at any time determine in good faith that a
Transfer or other event has taken place that results in a violation of Section
7.2.1 or that a Person intends to acquire or has attempted to acquire
Beneficial or Constructive Ownership of any Shares in violation of Section
7.2.1 (whether or not such violation is intended), the Board of Trustees or a
committee thereof shall take such action as it deems advisable to refuse to
give effect to or to prevent such Transfer or other event, including, without
limitation, causing the Trust to redeem Shares, refusing to give effect to such
Transfer on the books of the Trust or instituting proceedings to enjoin such
Transfer or other event; provided, however, that any Transfer or attempted
Transfer or other event in violation of Section 7.2.1 shall automatically
result in the transfer to the Charitable Trust described above, and, where
applicable, such Transfer (or other event) shall be void ab initio as provided
above irrespective of any action (or non-action) by the Board of Trustees or a
committee thereof.
Section 7.2.3 Notice of Restricted Transfer. Any Person who acquires or
attempts or intends to acquire Beneficial Ownership or Constructive Ownership
of Shares that will or may violate Section 7.2.1(a), or any Person who would
have owned Shares that resulted in a transfer to the Charitable Trust pursuant
to the provisions of Section 7.2.1(b), shall immediately give written notice to
the Trust of such event, or in the case of such a proposed or attempted
transaction, give at least 15 days prior written notice, and shall provide to
the Trust such other information as the Trust may request in order to determine
the effect, if any, of such acquisition or ownership on the Trust's status as a
REIT.
Section 7.2.4 Owners Required To Provide Information. From the Initial
Date and prior to the Restriction Termination Date:
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(a) every owner of more than five percent (or such lower
percentage as required by the Code or the Treasury Regulations promulgated
thereunder) of the outstanding Shares, within 30 days after the end of each
taxable year, shall give written notice to the Trust stating the name and
address of such owner, the number of Shares Beneficially Owned and a
description of the manner in which such Shares are held; provided that a
shareholder of record who holds outstanding Shares as nominee for another
Person, which other Person is required to include in gross income the dividends
received on such Shares (an "Actual Owner"), shall give written notice to the
Trust stating the name and address of such Actual Owner and the number of
Shares of such Actual Owner with respect to which the shareholder of record is
nominee. Each owner shall provide to the Trust such additional information as
the Trust may request in order to determine the effect, if any, of such
Beneficial Ownership on the Trust's status as a REIT and to ensure compliance
with the Ownership Limit.
(b) each Person who is a Beneficial or Constructive
Owner of Shares and each Person (including the shareholder of record) who is
holding Shares for a Beneficial or Constructive Owner shall provide to the
Trust such information as the Trust may request, in good faith, in order to
determine the Trust's status as a REIT and to comply with requirements of any
taxing authority or governmental authority or to determine such compliance.
Section 7.2.5 Remedies Not Limited. Subject to Sections 5.1 and 7.4 of
the Declaration of Trust, nothing contained in this Section 7.2 shall limit the
authority of the Board of Trustees to take such other action as it deems
necessary or advisable to protect the Trust and the interests of its
shareholders in preserving the Trust's status as a REIT.
Section 7.2.6 Ambiguity. In the case of an ambiguity in the application
of any of the provisions of this Section 7.2, Section 7.3 or any definition
contained in Section 7.1, the Board of Trustees shall have the power to
determine the application of the provisions of this Section 7.2 or Section 7.3
with respect to any situation based on the facts known to it. If
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Section 7.2 or 7.3 requires an action by the Board of Trustees and the
Declaration of Trust fails to provide specific guidance with respect to such
action, the Board of Trustees shall have the power to determine the action to
be taken so long as such action is not contrary to the provisions of
Sections 7.1, 7.2 or 7.3.
Section 7.2.7 Exceptions.
(a) The Board, in its sole and absolute discretion, may
grant to any Person who makes a request therefor an exception to the Ownership
Limit with respect to the ownership of any series or class of Preferred Shares,
subject to the following conditions and limitations: (A) the Board shall have
determined that (x) assuming such Person would Beneficially or Constructively
Own the maximum amount of Common Shares and Preferred Shares permitted as a
result of the exception to be granted and (y) assuming that all other Persons
who would be treated as "individuals" for purposes of Section 542(a)(2)
(determined taking into account Section 856(h)(3)(A) of the Code) would
Beneficially or Constructively Own the maximum amount of Common Shares and
Preferred Shares permitted under this Article VII (taking into account any
exception, waiver, or exemption granted under this Section 7.2.7 to (or with
respect to) such Persons), the Trust would not be "closely held" within the
meaning of Section 856(h) of the Code (assuming that the ownership of Shares
is determined during the second half of a taxable year) and would not
otherwise fail to qualify as a REIT; and (B) such Person provides to the Board
such representations and undertakings, if any, as the Board may, in its sole
and absolute discretion, determine to be necessary in order for it to make the
determination that the conditions set forth in clause (A) above of this
Section 7.2.7(a) have been and/or will continue to be satisfied (including,
without limitation, an agreement as to a reduced Ownership Limit or Excepted
Holder Limit for such Person with respect to the Beneficial or Constructive
Ownership of one or more other classes of Shares not subject to the exception),
and such Person agrees that any violation of such representations and
undertakings or any attempted violation thereof will result in the application
of
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the remedies set forth in Section 7.2 with respect to Shares held in excess
of the Ownership Limit or the Excepted Holder Limit (as may be applicable)
with respect to such Person (determined without regard to the exception granted
such Person under this subparagraph (a)). If a member of the Board requests
that the Board grant an exception pursuant to this subparagraph (a) with
respect to such member or with respect to any other Person if such Board member
would be considered to be the Beneficial or Constructive Owner of Shares owned
by such Person, such member of the Board shall not participate in the decision
of the Board as to whether to grant any such exception.
(b) In addition to exceptions permitted under
subparagraph (a) above, the Board shall except a Person from the Ownership
Limit if: (i) such Person submits to the Board information satisfactory to
the Board, in its reasonable discretion, demonstrating that such Person is not
an individual for purposes of Section 542(a)(2) of the Code (determined taking
into account Section 856(h)(3)(A) of the Code); (ii) such Person submits to
the Board information satisfactory to the Board, in its reasonable discretion,
demonstrating that no Person who is an individual for purposes of Section
542(a)(2) of the Code (determined taking into account Section 856(h)(3)(A) of
the Code) would be considered to Beneficially Own Shares in excess of the
Ownership Limit by reason of the Excepted Holder's ownership of Shares in
excess of the Ownership Limit pursuant to the exception granted under this
subparagraph (b); (iii) such Person submits to the Board information
satisfactory to the Board, in its reasonable discretion, demonstrating that
clause (2) of subparagraph (a)(ii) of Section 7.2.1 will not be violated by
reason of the Excepted Holder's ownership of Shares in excess of the Ownership
Limit pursuant to the exception granted under this subparagraph (b); and (iv)
such Person provides to the Board such representations and undertakings, if
any, as the Board may, in its reasonable discretion, require to ensure that
the conditions in clauses (i), (ii) and (iii) hereof are satisfied and will
continue to be satisfied throughout the period during which such Person owns
Shares in excess of the
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Ownership Limit pursuant to any exception thereto granted under this
subparagraph (b), and such Person agrees that any violation of such
representations and undertakings or any attempted violation thereof will
result in the application of the remedies set forth in Section 7.2 with
respect to Shares held in excess of the Ownership Limit with respect to such
Person (determined without regard to the exception granted such Person under
this subparagraph (b)).
(c) Prior to granting any exception or exemption
pursuant to subparagraph (a) or (b), the Board may require a ruling from the
IRS or an opinion of counsel, in either case in form and substance satisfactory
to the Board, in its sole and absolute discretion as it may deem necessary or
advisable in order to determine or ensure the Trust's status as a REIT;
provided, however, that the Board shall not be obligated to require obtaining
a favorable ruling or opinion in order to grant an exception hereunder.
(d) Subject to Section 7.2.1(a)(ii), an underwriter that
participates in a public offering or a private placement of Shares (or
securities convertible into or exchangeable for Shares) may Beneficially or
Constructively Own Shares (or securities convertible into or exchangeable for
Shares) in excess of the Ownership Limit, but only to the extent necessary to
facilitate such public offering or private placement.
(e) The Board of Trustees may only reduce the Excepted
Holder Limit for an Excepted Holder: (1) with the written consent of such
Excepted Holder at any time, or (2) pursuant to the terms and conditions of
the agreements and undertakings entered into with such Excepted Holder in
connection with the establishment of the Excepted Holder Limit for that
Excepted Holder. No Excepted Holder Limit shall be reduced to a percentage
that is less than the Ownership Limit.
Section 7.2.8 Increase in Ownership Limit. The Board of Trustees may
from time to time increase the Ownership Limit, subject to the limitations
provided in this Section 7.2.8.
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(a) The Ownership Limit may not be increased if, after
giving effect to such increase, five Persons who are considered individuals
pursuant to Section 542 of the Code, as modified by Section 856(h)(3) of the
Code (taking into account all of the Excepted Holders), could Beneficially Own,
in the aggregate, more than 49.5% of the value of the outstanding Shares.
(b) Prior to the modification of the Ownership Limit
pursuant to this Section 7.2.8, the Board may require such opinions of counsel,
affidavits, undertakings or agreements as it may deem necessary or advisable
in order to determine or ensure the Trust's status as a REIT if the
modification in the Ownership Limit were to be made.
Section 7.2.9 Legend. Each certificate for Shares shall bear
substantially the following legend:
The shares represented by this certificate are subject
to restrictions on Beneficial and Constructive
Ownership and Transfer for the purpose of the Trust's
maintenance of its status as a Real Estate Investment
Trust (a "REIT") under the Internal Revenue Code of
1986, as amended (the "Code"). Subject to certain
further restrictions and except as expressly provided
in the Trust's Declaration of Trust, (i) no Person may
Beneficially or Constructively Own Common Shares of
the Trust in excess of 9.9 percent (in value or number
of shares) of the outstanding Common Shares of the
Trust unless such Person is an Excepted Holder (in
which case the Excepted Holder Limit shall be
applicable); (ii) with respect to any class or series
of Preferred Shares, no Person may Beneficially or
Constructively Own more than 9.9 percent (in value or
number of shares) of the outstanding shares of such
class or series of Preferred Shares of the Trust,
unless such Person is an Excepted Holder (in which
case the Excepted Holder Limit shall be applicable);
(iii) no Person may Beneficially or Constructively Own
Shares that would result in the Trust being "closely
held" under Section 856(h) of the Code or otherwise
cause the Trust to fail to qualify as a REIT; and (iv)
no Person may Transfer Shares if such Transfer would
result in Shares of the Trust being owned by fewer
than 100 Persons. Any Person who Beneficially or
Constructively Owns or attempts to Beneficially or
Constructively Own Shares which cause or will cause a
Person to Beneficially or Constructively Own Shares in
excess or in violation of the above limitations must
immediately notify the Trust. If any of the
restrictions on transfer or ownership are violated,
the Shares represented hereby will be automatically
transferred to a Charitable Trustee of a Charitable
Trust for the benefit of one or more Charitable
Beneficiaries. In
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addition, upon the occurrence of certain events, attempted
Transfers in violation of the restrictions described
above may be void ab initio. A Person who attempts to
Beneficially or Constructively Own Shares in violation
of the ownership limitations described above shall
have no claim, cause of action, or any recourse
whatsoever against a transferor of such Shares. All
capitalized terms in this legend have the meanings
defined in the Trust's Declaration of Trust, as the
same may be amended from time to time, a copy of
which, including the restrictions on transfer and
ownership, will be furnished to each holder of Shares
of the Trust on request and without charge.
Instead of the foregoing legend, the certificate may state that the Trust
will furnish a full statement about certain restrictions on transferability to
a shareholder on request and without charge.
Section 7.3 Transfer of Shares in Trust.
Section 7.3.1 Ownership in Trust. Upon any purported Transfer or other
event described in Section 7.2.1(b) that would result in a transfer of Shares
to a Charitable Trust, such Shares shall be deemed to have been transferred to
the Charitable Trustee as trustee of a Charitable Trust for the exclusive
benefit of one or more Charitable Beneficiaries. Such transfer to the
Charitable Trustee shall be deemed to be effective as of the close of business
on the Business Day prior to the purported Transfer or other event that results
in the transfer to the Charitable Trust pursuant to Section 7.2.1(b). The
Charitable Trustee shall be appointed by the Trust and shall be a Person
unaffiliated with the Trust and any Prohibited Owner. Each Charitable
Beneficiary shall be designated by the Trust as provided in Section 7.3.7.
Section 7.3.2 Status of Shares Held by the Charitable Trustee. Shares
held by the Charitable Trustee shall be issued and outstanding Shares of the
Company. The Prohibited Owner shall have no rights in the Shares held by the
Charitable Trustee. The Prohibited Owner shall not benefit economically from
ownership of any Shares held in trust by the Charitable Trustee, shall have no
rights to dividends or other distributions and shall not possess any rights to
vote or other rights attributable to the Shares held in the Charitable Trust.
The
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Prohibited Owner shall have no claim, cause of action, or any other recourse
whatsoever against the purported transferor of such Shares.
Section 7.3.3 Dividend and Voting Rights. The Charitable Trustee shall
have all voting rights and rights to dividends or other distributions with
respect to Shares held in the Charitable Trust, which rights shall be exercised
for the exclusive benefit of the Charitable Beneficiary. Any dividend or other
distribution paid prior to the discovery by the Trust that Shares have been
transferred to the Charitable Trustee shall be paid with respect to such Shares
to the Charitable Trustee upon demand and any dividend or other distribution
authorized but unpaid shall be paid when due to the Charitable Trustee. Any
dividends or distributions so paid over to the Charitable Trustee shall be held
in trust for the Charitable Beneficiary. The Prohibited Owner shall have no
voting rights with respect to Shares held in the Charitable Trust and, subject
to Maryland law, effective as of the date that Shares have been transferred to
the Charitable Trustee, the Charitable Trustee shall have the authority (at the
Charitable Trustee's sole discretion) (i) to rescind as void any vote cast by a
Prohibited Owner prior to the discovery by the Trust that Shares have been
transferred to the Charitable Trustee and (ii) to recast such vote in
accordance with the desires of the Charitable Trustee acting for the benefit of
the Charitable Beneficiary; provided, however, that if the Trust has already
taken irreversible action, then the Charitable Trustee shall not have the power
to rescind and recast such vote. Notwithstanding the provisions of this
Article VII, until the Trust has received notification that Shares have been
transferred into a Charitable Trust, the Trust shall be entitled to rely on its
share transfer and other shareholder records for purposes of preparing lists of
shareholders entitled to vote at meetings, determining the validity and
authority of proxies and otherwise conducting votes of shareholders.
Section 7.3.4 Rights Upon Liquidation. Upon any voluntary or involuntary
liquidation, dissolution or winding up of or any distribution of the assets of
the Trust, the Charitable Trustee shall be entitled to receive, ratably with
each other holder of Shares of the class or series
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of Shares that is held in the Charitable Trust, that portion of the assets of
the Trust available for distribution to the holders of such class or series
(determined based upon the ratio that the number of Shares or such class or
series of Shares held by the Charitable Trustee bears to the total number of
Shares of such class or series of Shares then outstanding). The Charitable
Trustee shall distribute any such assets received in respect of the Shares
held in the Charitable Trust in any liquidation, dissolution or winding up of,
or distribution of the assets of the Trust, in accordance with Section 7.3.5.
Section 7.3.5 Sale of Shares by Charitable Trustee. Within 20 days of
receiving notice from the Trust that Shares have been transferred to the
Charitable Trust, the Charitable Trustee of the Charitable Trust shall sell the
Shares held in the Charitable Trust to a person, designated by the Charitable
Trustee, whose ownership of the Shares will not violate the ownership
limitations set forth in Section 7.2.1(a). Upon such sale, the interest of the
Charitable Beneficiary in the Shares sold shall terminate and the Charitable
Trustee shall distribute the net proceeds of the sale to the Prohibited Owner
and to the Charitable Beneficiary as provided in this Section 7.3.5. The
Prohibited Owner shall receive the lesser of (1) the price paid by the
Prohibited Owner for the Shares or, if the Prohibited Owner did not give value
for the Shares in connection with the event causing the Shares to be held in
the Charitable Trust (e.g., in the case of a gift, devise or other such
transaction), the Market Price of the Shares on the day of the event causing
the Shares to be held in the Charitable Trust and (2) the price per share
received by the Charitable Trustee from the sale or other disposition of the
Shares held in the Charitable Trust. Any net sales proceeds in excess of the
amount payable to the Prohibited Owner shall be immediately paid to the
Charitable Beneficiary. If, prior to the discovery by the Trust that Shares
have been transferred to the Charitable Trustee, such Shares are sold by a
Prohibited Owner, then (i) such Shares shall be deemed to have been sold on
behalf of the Charitable Trust and (ii) to the extent that the Prohibited Owner
received an amount for such Shares that exceeds the
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amount that such Prohibited Owner was entitled to receive pursuant to this
Section 7.3.5, such excess shall be paid to the Charitable Trustee upon demand.
The Charitable Trustee shall have the right and power (but not the obligation)
to offer any Equity Share held in trust for sale to the Trust on such terms and
conditions as the Charitable Trustee shall deem appropriate.
Section 7.3.6 Purchase Right in Shares Transferred to the Charitable
Trustee. Shares transferred to the Charitable Trustee shall be deemed to have
been offered for sale to the Trust, or its designee, at a price per share equal
to the lesser of (i) the price per share in the transaction that resulted in
such transfer to the Charitable Trust (or, in the case of a devise or gift, the
Market Price at the time of such devise or gift) and (ii) the Market Price on
the date the Trust, or its designee, accepts such offer. The Trust shall have
the right to accept such offer until the Charitable Trustee has sold the Shares
held in the Charitable Trust pursuant to Section 7.3.5. Upon such a sale to
the Trust, the interest of the Charitable Beneficiary in the Shares sold shall
terminate and the Charitable Trustee shall distribute the net proceeds of the
sale to the Prohibited Owner.
Section 7.3.7 Designation of Charitable Beneficiaries. By written notice
to the Charitable Trustee, the Trust shall designate one or more nonprofit
organizations to be the Charitable Beneficiary of the interest in the
Charitable Trust such that (i) Shares held in the Charitable Trust would not
violate the restrictions set forth in Section 7.2.1(a) in the hands of such
Charitable Beneficiary and (ii) each such organization must be described in
Sections 501(c)(3), 170(b)(1)(A) or 170(c)(2) of the Code.
Section 7.4 NYSE Transactions. Nothing in this Article VII shall
preclude the settlement of any transaction entered into through the facilities
of the NYSE or any other national securities exchange or automated inter-dealer
quotation system. The fact that the settlement of any transaction takes place
shall not negate the effect of any other provision of this Article VII and any
transferee in such a transaction shall be subject to all of the provisions and
limitations set
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forth in this Article VII.
Section 7.5 Enforcement. The Trust is authorized specifically to seek
equitable relief, including injunctive relief, to enforce the provisions of
this Article VII.
Section 7.6 Non-Waiver. No delay or failure on the part of the Trust or
the Board of Trustees in exercising any right hereunder shall operate as a
waiver of any right of the Trust or the Board of Trustees, as the case may be,
except to the extent specifically waived in writing.
ARTICLE VIII
SHAREHOLDERS
Section 8.1 Meetings. There shall be an annual meeting of the
shareholders, to be held on proper notice at such time (after the delivery of
the annual report) and convenient location as shall be determined by or in the
manner prescribed in the Bylaws, for the election of the Trustees, if required,
and for the transaction of any other business within the powers of the Trust.
Except as otherwise provided in the Declaration of Trust, special meetings of
shareholders may be called in the manner provided in the Bylaws. If there are
no Trustees, the officers of the Trust shall promptly call a special meeting of
the shareholders entitled to vote for the election of successor Trustees. Any
meeting may be adjourned and reconvened as the Trustees determine or as
provided in the Bylaws.
Section 8.2 Voting Rights. Subject to the provisions of any class or
series of Shares then outstanding, the shareholders shall be entitled to vote
only on the following matters: (a) election of Trustees as provided in Section
5.2 and the removal of Trustees as provided in Section 5.3; (b) amendment of
the Declaration of Trust as provided in Article X; (c) termination of the Trust
as provided in Section 10.3; (d) merger or consolidation of the Trust, or the
sale or disposition of substantially all of the property of the Trust , as
provided in Article VIII; (e) such other matters with respect to which the
Board of Trustees has adopted a resolution declaring that a proposed action is
advisable and directing that the matter be submitted to the shareholders for
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approval or ratification; and (f) such other matters as may be properly brought
before a meeting by a shareholder pursuant to the Bylaws. Except with respect
to the foregoing matters, no action taken by the shareholders at any meeting
shall in any way bind the Board of Trustees.
Section 8.3 Preemptive and Appraisal Rights. Except as may be provided
by the Board of Trustees in setting the terms of classified or reclassified
Shares pursuant to Section 6.4, no holder of Shares shall, as such holder, (a)
have any preemptive right to purchase or subscribe for any additional Shares of
the Trust or any other security of the Trust which it may issue or sell or (b),
except as expressly required by Title 8, have any right to require the Trust to
pay him the fair value of his Shares in an appraisal or similar proceeding.
Section 8.4 Extraordinary Actions. Except as otherwise specifically
provided in the Declaration of Trust (including, without limitation, in those
provisions relating to election and removal of Trustees and changes in the
number of authorized Shares), notwithstanding any provision of law permitting
or requiring any action to be taken or authorized by the affirmative vote of
the holders of a greater number of votes, (a) any transaction approval of which
requires by law the affirmative vote of shareholders and pursuant to which the
Trust's business and assets will be combined with those of one or more other
entities (whether by merger, sale or other transfer of assets, consolidation or
share exchange) (a "Business Combination") shall be effective and valid if
taken or authorized by the affirmative vote of not less than a majority of all
the votes entitled to be cast on the matter and (b) any other action shall be
effective and valid if taken or authorized by the affirmative vote of not less
than sixty-six and two-thirds percent (66 2/3%) of all the votes entitled to be
cast on the matter.
Section 8.5 Action By Shareholders without a Meeting. The Bylaws of the
Trust may provide that any action required or permitted to be taken by the
shareholders may be taken without a meeting by the written consent of the
shareholders entitled to cast a sufficient number of votes to approve the
matter as required by statute, the Declaration of Trust or the Bylaws of the
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Trust, as the case may be.
ARTICLE IX
LIABILITY LIMITATION, INDEMNIFICATION
AND TRANSACTIONS WITH THE TRUST
Section 9.1 Limitation of Shareholder Liability. No shareholder shall be
liable for any debt, claim, demand, judgment or obligation of any kind of,
against or with respect to the Trust by reason of his being a shareholder, nor
shall any shareholder be subject to any personal liability whatsoever, in tort,
contract or otherwise, to any person in connection with the property or the
affairs of the Trust by reason of his being a shareholder.
Section 9.2 Limitation of Trustee and Officer Liability. To the maximum
extent that Maryland law in effect from time to time permits limitation of the
liability of trustees and officers of a real estate investment trust, no
Trustee or officer of the Trust shall be liable to the Trust or to any
shareholder for money damages. Neither the amendment nor repeal of this
Section 9.2, nor the adoption or amendment of any other provision of the
Declaration of Trust inconsistent with this Section 9.2, shall apply to or
affect in any respect the applicability of the preceding sentence with respect
to any act or failure to act which occurred prior to such amendment, repeal or
adoption. In the absence of any Maryland statute limiting the liability of
trustees and officers of a Maryland real estate investment trust for money
damages in a suit by or on behalf of the Trust or by any shareholder, no
Trustee or officer of the Trust shall be liable to the Trust or to any
shareholder for money damages except to the extent that (a) the Trustee or
officer actually received an improper benefit or profit in money, property, or
services, for the amount of the benefit or profit in money, property, or
services actually received; or (b) a judgment or other final adjudication
adverse to the Trustee or officer is entered in a proceeding based on a finding
in the proceeding that the Trustee's or officer's action or failure to act was
the result of active and deliberate dishonesty and was material to the cause of
action adjudicated in the proceeding.
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Section 9.3 Indemnification. The Trust shall have the power, to the
maximum extent permitted by Maryland law in effect from time to time, to
obligate itself to indemnify, and to pay or reimburse reasonable expenses in
advance of final disposition of a proceeding to, (a) any individual who is a
present or former shareholder, Trustee or officer of the Trust or (b) any
individual who, while a Trustee of the Trust and at the request of the Trust,
serves or has served as a director, officer, partner, trustee, employee or
agent of another corporation, partnership, joint venture, trust, employee
benefit plan or any other enterprise from and against any claim or liability
to which such person may become subject or which such person may incur by
reason of his status as a present or former shareholder, Trustee or officer of
the Trust. The Trust shall have the power, with the approval of its Board of
Trustees, to provide such indemnification and advancement of expenses to a
person who served a predecessor of the Trust in any of the capacities
described in (a) or (b) above and to any employee or agent of the Trust or a
predecessor of the Trust.
Section 9.4 Transactions Between the Trust and its Trustees, Officers,
Employees and Agents. Subject to any express restrictions in the Declaration
of Trust or adopted by the Trustees in the Bylaws or by resolution, the Trust
may enter into any contract or transaction of any kind with any person,
including any Trustee, officer, employee or agent of the Trust or any person
affiliated with a Trustee, officer, employee or agent of the Trust, whether or
not any of them has a financial interest in such transaction.
Section 9.5 Express Exculpatory Clauses in Instruments. The Board of
Trustees shall cause to be inserted in every written agreement, undertaking or
obligation made or issued on behalf of the Trust, an appropriate provision to
the effect that neither the Shareholders nor the Trustees, officers, employees
or agents of the Trust shall be liable under any written instrument creating an
obligation of the Trust, and all Persons shall look solely to the property of
the Trust for the payment of any claim under or for the performance of that
instrument. The omission of the
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foregoing exculpatory language from any instrument shall not affect the
validity or enforceability of such instrument and shall not render any
Shareholder, Trustee, officer, employee or agent liable thereunder to any third
party nor shall the Trustees or any officer, employee or agent of the Trust be
liable to anyone for such omission.
ARTICLE X
AMENDMENTS
Section 10.1 General. The Trust reserves the right from time to time to
make any amendment to the Declaration of Trust, now or hereafter authorized by
law, including any amendment altering the terms or contract rights, as
expressly set forth in the Declaration of Trust, of any Shares. All rights and
powers conferred by the Declaration of Trust on shareholders, Trustees and
officers are granted subject to this reservation. Articles of Amendment to the
Declaration of Trust (a) shall be signed and acknowledged by at least a
majority of the Trustees, or an officer duly authorized by at least a majority
of the Trustees, (b) shall be filed for record as provided in Section 12.5 and
(c) shall become effective as of the later of the time the SDAT accepts the
Articles of Amendment for record or the time established in the Articles of
Amendment, not to exceed 30 days after the Articles of Amendment are accepted
for record. All references to the Declaration of Trust shall include all
amendments thereto.
Section 10.2 By Trustees. The Trustees may amend the Declaration of
Trust from time to time, in the manner provided by Title 8, without any action
by the shareholders, to qualify as a real estate investment trust under the
Code or under Title 8 and as otherwise provided in the Declaration of Trust.
Section 10.3 By Shareholders. Except as otherwise provided in this
Declaration of Trust, any amendment to the Declaration of Trust shall be valid
only (a) if in connection with a Business Combination or pursuant to Section
6.1, if approved by the affirmative vote of not less than a majority of all the
votes entitled to be cast on the matter and (b) otherwise, if approved by
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the affirmative vote of not less than sixty-six and two thirds percent
(66 2/3%) of all the votes entitled to be cast on the matter.
ARTICLE XI
DURATION AND TERMINATION OF TRUST
Section 11.1 Duration. The Trust shall continue perpetually unless
terminated pursuant to Section 11.2 or pursuant to any applicable provision of
Title 8.
Section 11.2 Termination.
(a) Subject to the provisions of any class or series of
Shares at the time outstanding, the Trust may be terminated at any meeting of
shareholders, by the affirmative vote of sixty-six and two thirds percent
(66 2/3%) of all the votes entitled to be cast on the matter. Upon the
termination of the Trust:
(i) The Trust shall carry on no business except for
the purpose of winding up its affairs.
(ii) The Trustees shall proceed to wind up the
affairs of the Trust and all of the powers of the Trustees under the
Declaration of Trust shall continue, including the powers to fulfill or
discharge the Trust's contracts, collect its assets, sell, convey, assign,
exchange, transfer or otherwise dispose of all or any part of the remaining
property of the Trust to one or more persons at public or private sale for
consideration which may consist in whole or in part of cash, securities or
other property of any kind, discharge or pay its liabilities and do all other
acts appropriate to liquidate its business.
(iii) After paying or adequately providing for the
payment of all liabilities, and upon receipt of such releases, indemnities and
agreements as they deem necessary for their protection, the Trust may
distribute the remaining property of the Trust among the shareholders so that
after payment in full or the setting apart for payment of such preferential
amounts, if any, to which the holders of any Shares at the time outstanding
shall be entitled, the
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remaining property of the Trust shall, subject to any participating or similar
rights of Shares at the time outstanding, be distributed ratably among the
holders of Common Shares at the time outstanding.
(b) After termination of the Trust, the liquidation of
its business and the distribution to the shareholders as herein provided, a
majority of the Trustees shall execute and file with the Trust's records a
document certifying that the Trust has been duly terminated, and the Trustees
shall be discharged from all liabilities and duties hereunder, and the rights
and interests of all shareholders shall cease.
ARTICLE XII
MISCELLANEOUS
Section 12.1 Governing Law. The Declaration of Trust is executed by the
undersigned Trustees and delivered in the State of Maryland with reference to
the laws thereof, and the rights of all parties and the validity, construction
and effect of every provision hereof shall be subject to and construed
according to the laws of the State of Maryland without regard to conflicts of
laws provisions thereof.
Section 12.2 Reliance by Third Parties. Any certificate shall be final
and conclusive as to any person dealing with the Trust if executed by the
Secretary or an Assistant Secretary of the Trust or a Trustee, and if
certifying to: (a) the number or identity of Trustees, officers of the Trust or
shareholders; (b) the due authorization of the execution of any document; (c)
the action or vote taken, and the existence of a quorum, at a meeting of the
Board of Trustees or shareholders; (d) a copy of the Declaration of Trust or of
the Bylaws as a true and complete copy as then in force; (e) an amendment to
the Declaration of Trust; (f) the termination of the Trust; or (g) the
existence of any fact or relating to the affairs of the Trust. No purchaser,
lender, transfer agent or other person shall be bound to make any inquiry
concerning the validity of any transaction purporting to be made by the Trust
on its behalf or by any officer, employee or agent
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of the Trust.
Section 12.3 Severability.
(a) The provisions of the Declaration of Trust are
severable, and if the Board of Trustees shall determine, with the advice of
counsel, that any one or more of such provisions (the "Conflicting Provisions")
are in conflict with the Code, Title 8 or other applicable federal or state
laws, the Conflicting Provisions, to the extent of the conflict, shall be
deemed never to have constituted a part of the Declaration of Trust, even
without any amendment of the Declaration of Trust pursuant to Article X and
without affecting or impairing any of the remaining provisions of the
Declaration of Trust or rendering invalid or improper any action taken or
omitted prior to such determination. No Trustee shall be liable for making or
failing to make such a determination. In the event of any such determination
by the Board of Trustees, the Board shall amend the Declaration of Trust in
the manner provided in Section 10.2.
(b) If any provision of the Declaration of Trust shall
be held invalid or unenforceable in any jurisdiction, such holding shall apply
only to the extent of any such invalidity or unenforceability and shall not in
any manner affect, impair or render invalid or unenforceable such provision in
any other jurisdiction or any other provision of the Declaration of Trust in any
jurisdiction.
Section 12.4 Construction. In the Declaration of Trust, unless the
context otherwise requires, words used in the singular or in the plural include
both the plural and singular and words denoting any gender include all genders.
The title and headings of different parts are inserted for convenience and
shall not affect the meaning, construction or effect of the Declaration of
Trust. In defining or interpreting the powers and duties of the Trust and its
Trustees and officers, reference may be made by the Trustees or officers, to
the extent appropriate and not inconsistent with the Code or Title 8, to Titles
1 through 3 of the Corporations and Associations Article of the Annotated Code
of Maryland. In furtherance and not in limitation of the foregoing, in
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accordance with the provisions of Title 3, Subtitles 6 and 7, of the
Corporations and Associations Article of the Annotated Code of Maryland, the
Trust shall be included within the definition of "corporation" for purposes of
such provisions.
Section 12.5 Recordation. The Declaration of Trust and any articles of
amendment hereto shall be filed for record with the SDAT and may also be filed
or recorded in such other places as the Trustees deem appropriate, but failure
to file for record the Declaration of Trust or any articles of amendment hereto
in any office other than in the State of Maryland shall not affect or impair
the validity or effectiveness of the Declaration of Trust or any amendment
hereto. A restated Declaration of Trust shall, upon filing, be conclusive
evidence of all amendments contained therein and may thereafter be referred to
in lieu of the original Declaration of Trust and the various articles of
amendments thereto.
Section 12.6 ERISA Considerations. The Board of Trustees shall conduct
the affairs of the Trust so that the underlying assets of the Trust will not be
considered to constitute assets (as defined in the regulations of the
Department of Labor contained in 29 C.F.R. Section 2510.3-101 or successor
regulations (such regulation or successor regulation being known as the "Plan
Assets Regulation")) of any ERISA Shareholder. For purposes of this section
12.6, the term "ERISA Shareholder" means a holder of Shares (i) received in the
mergers of ZML Investors, Inc., ZML Investors II, Inc., Zell/Merrill Lynch Real
Estate Opportunity Partners III Trust, and Zell/Merrill Lynch Real Estate
Opportunity Partners IV Trust into the Trust, and (ii) that is either an
employee benefit plan subject to Title I of ERISA, or section 4975 of the Code,
or a nominee for or a trust established pursuant to such employee benefit plan,
or an entity whose underlying assets include assets of such employee benefit
plan by reason of such plan's investment in such entity. If, and so long as,
the Beneficial Ownership by "benefit plan investors" is "significant" (as those
terms are used in the Plan Assets Regulation) and the Shares in which there is
"significant" benefit plan ownership do not constitute "publicly offered
securities" (as that term is used in the Plan Assets
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Regulation), then the Board of Trustees shall conduct the affairs of the Trust
as a "venture capital operating company" ("VCOC"), as that term is used in the
Plan Assets Regulations.
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IN WITNESS WHEREOF, THESE ARTICLES OF AMENDMENT AND RESTATEMENT OF
DECLARATION OF TRUST HAVE BEEN SIGNED ON THIS 8th DAY OF JULY, 1997
BY THE UNDERSIGNED PRESIDENT OF THE TRUST AND WITNESSED BY THE UNDERSIGNED
SECRETARY OF THE TRUST, EACH OF WHOM ACKNOWLEDGES, THAT THIS DOCUMENT IS HIS
FREE ACT AND DEED, AND THAT TO THE BEST OF HIS KNOWLEDGE, INFORMATION, AND
BELIEF, THE MATTERS AND FACTS SET FORTH HEREIN ARE TRUE IN ALL MATERIAL
RESPECTS AND THAT THE STATEMENT IS MADE UNDER THE PENALTIES FOR PERJURY.
ATTEST: EQUITY OFFICE PROPERTIES TRUST
/s/ Stanley M. Stevens (SEAL) /s/ Timothy H. Callahan
- ------------------------- -------------------------------
STANLEY M. STEVENS TIMOTHY H. CALLAHAN
SECRETARY PRESIDENT
OR
IN WITNESS WHEREOF, THE ARTICLES OF AMENDMENT AND RESTATEMENT OF
DECLARATION OF TRUST HAVE BEEN SIGNED ON THIS 8th DAY OF JULY, 1997
BY A MAJORITY OF THE TRUSTEES OF THE TRUST, EACH OF WHOM ACKNOWLEDGES, THAT
THIS DOCUMENT IS HIS FREE ACT AND DEED, AND THAT TO THE BEST OF HIS KNOWLEDGE,
INFORMATION, AND BELIEF, THE MATTERS AND FACTS SET FORTH HEREIN ARE TRUE IN ALL
MATERIAL RESPECTS AND THAT THE STATEMENT IS MADE UNDER THE PENALTIES FOR
PERJURY.
/s/ Samuel Zell
----------------------------------
TRUSTEE
/s/ Sheli Z. Rosenberg
----------------------------------
TRUSTEE
/s/ Timothy H. Callahan
----------------------------------
TRUSTEE
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EXHIBIT 3.2
EQUITY OFFICE PROPERTIES TRUST
BYLAWS
ARTICLE I
OFFICES
Section 1. PRINCIPAL OFFICE. The principal office of Equity Office
Properties Trust (the "Trust") shall be located at such place or places as the
Trustees may designate.
Section 2. ADDITIONAL OFFICES. The Trust may have additional offices at
such places as the Trustees may from time to time determine or the business of
the Trust may require.
ARTICLE II
MEETINGS OF SHAREHOLDERS
Section 1. PLACE. All meetings of shareholders shall be held at the
principal office of the Trust or at such other place within the United States
as shall be stated in the notice of the meeting.
Section 2. ANNUAL MEETING. An annual meeting of the shareholders for the
election of Trustees and the transaction of any business within the powers of
the Trust shall be held during the month of May of each year, after the
delivery of the annual report referred to in Section 12 of this Article II, at
a convenient location and on proper notice, on a date and at the time set by
the Trustees, beginning with the year 1998. Failure to hold an annual meeting
does not invalidate the Trust's existence or affect any otherwise valid acts of
the Trust.
Section 3. SPECIAL MEETINGS. The chairman of the board or the president
or one-third of the Trustees may call special meetings of the shareholders.
Special meetings of shareholders shall also be called by the secretary upon the
written request of the holders of shares entitled to cast not less than a
majority of all the votes entitled to be cast at such meeting. Such request
shall state the purpose of such meeting and the matters proposed to be acted on
at such meeting. Within ten (10) days of the receipt of such a request, the
secretary shall inform such shareholders of the reasonably estimated cost of
preparing and mailing notice of the meeting (including all proxy materials that
may be required in connection therewith) and, upon payment by such shareholders
to the Trust of such costs, the secretary shall, within thirty (30) days of
such payment, or such longer period as may be necessitated by compliance with
any applicable statutory or regulatory requirements, give notice to each
shareholder entitled to notice of the meeting.
Unless requested by shareholders entitled to cast a majority of all the
votes entitled to be cast at such meeting, a special meeting need not be called
to consider any matter which is substantially the same as a matter voted on at
any meeting of the shareholders held during the preceding twelve months.
<PAGE> 2
Section 4. NOTICE. Not less than ten nor more than 90 days before each
meeting of shareholders, the secretary shall give to each shareholder entitled
to vote at such meeting and to each shareholder not entitled to vote who is
entitled to notice of the meeting written or printed notice stating the time
and place of the meeting and, in the case of a special meeting or as otherwise
may be required by any statute, the purpose for which the meeting is called,
either by mail or by presenting it to such shareholder personally or by leaving
it at his residence or usual place of business. If mailed, such notice shall
be deemed to be given when deposited in the United States mail addressed to the
shareholder at his post office address as it appears on the records of the
Trust, with postage thereon prepaid.
Section 5. SCOPE OF NOTICE. Any business of the Trust may be transacted
at an annual meeting of shareholders without being specifically designated in
the notice, except such business as is required by any statute to be stated in
such notice. No business shall be transacted at a special meeting of
shareholders except as specifically designated in the notice.
Section 6. ORGANIZATION. At every meeting of the shareholders, the
Chairman of the Board, if there be one, shall conduct the meeting or, in the
case of vacancy in office or absence of the Chairman of the Board, one of the
following officers present shall conduct the meeting in the order stated: the
Vice Chairman of the Board, if there be one, the President, the Vice Presidents
in their order of rank and seniority, or a Chairman chosen by the shareholders
entitled to cast a majority of the votes which all shareholders present in
person or by proxy are entitled to cast, shall act as Chairman, and the
Secretary, or, in his absence, an assistant secretary, or in the absence of
both the Secretary and assistant secretaries, a person appointed by the
Chairman shall act as Secretary.
Section 7. QUORUM. At any meeting of shareholders, the presence in
person or by proxy of shareholders entitled to cast a majority of all the votes
entitled to be cast at such meeting shall constitute a quorum; but this section
shall not affect any requirement under any statute or the declaration of trust
("Declaration of Trust") for the vote necessary for the adoption of any
measure. If, however, such quorum shall not be present at any meeting of the
shareholders, the shareholders entitled to vote at such meeting, present in
person or by proxy, shall have the power to adjourn the meeting from time to
time to a date not more than 120 days after the original record date without
notice other than announcement at the meeting. At such adjourned meeting at
which a quorum shall be present, any business may be transacted which might
have been transacted at the meeting as originally notified.
Section 8. VOTING. A plurality of all the votes cast at a meeting of
shareholders duly called and at which a quorum is present shall be sufficient
to elect a Trustee. Each share may be voted for as many individuals as there
are Trustees to be elected and for whose election the share is entitled to be
voted. A majority of the votes cast at a meeting of shareholders duly called
and at which a quorum is present shall be sufficient to approve any other
matter which may properly come before the meeting, unless more than a majority
of the votes cast is required herein or by statute or by the Declaration of
Trust. Unless otherwise provided in the Declaration of Trust, each outstanding
share, regardless of class, shall be entitled to one vote on each matter
submitted to a vote at a meeting of shareholders.
Section 9. PROXIES. A shareholder may cast the votes entitled to be cast
by the shares owned of record by him either in person or by proxy executed in
writing by the shareholder or by his duly authorized attorney in fact. Such
proxy shall be filed with the
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Secretary of the Trust before or at the time of the meeting. No proxy shall be
valid after eleven months from the date of its execution, unless otherwise
provided in the proxy.
Section 10. VOTING OF SHARES BY CERTAIN HOLDERS. Shares of the Trust
registered in the name of a corporation, partnership, trust or other entity, if
entitled to be voted, may be voted by the president or a vice president, a
general partner or trustee thereof, as the case may be, or a proxy appointed by
any of the foregoing individuals, unless some other person who has been
appointed to vote such shares pursuant to a bylaw or a resolution of the
governing board of such corporation or other entity or agreement of the
partners of the partnership presents a certified copy of such bylaw, resolution
or agreement, in which case such person may vote such shares. Any trustee or
other fiduciary may vote shares registered in his name as such fiduciary,
either in person or by proxy.
Shares of the Trust directly or indirectly owned by it shall not be voted
at any meeting and shall not be counted in determining the total number of
outstanding shares entitled to be voted at any given time, unless they are held
by it in a fiduciary capacity, in which case they may be voted and shall be
counted in determining the total number of outstanding shares at any given
time.
The Trustees may adopt by resolution a procedure by which a shareholder
may certify in writing to the Trust that any shares registered in the name of
the shareholder are held for the account of a specified person other than the
shareholder. The resolution shall set forth the class of shareholders who may
make the certification, the purpose for which the certification may be made,
the form of certification and the information to be contained in it; if the
certification is with respect to a record date or closing of the share transfer
books, the time after the record date or closing of the share transfer books
within which the certification must be received by the Trust; and any other
provisions with respect to the procedure which the Trustees consider necessary
or desirable. on receipt of such certification, the person specified in the
certification shall be regarded as, for the purposes set forth in the
certification, the shareholder of record of the specified shares in place of
the shareholder who makes the certification.
Notwithstanding any other provision contained herein or in the Declaration
of Trust or these Bylaws, Title 3, Subtitle 7 of the Corporations and
Associations Article of the Annotated Code of Maryland (or any successor
statute) shall not apply to any acquisition by any person of shares of
beneficial interest of the Trust. This section may be repealed, in whole or in
part, at any time, whether before or after an acquisition of control shares
and, upon such repeal, may, to the extent provided by any successor bylaw,
apply to any prior or subsequent control share acquisition.
Section 11. INSPECTORS. At any meeting of shareholders, the chairman of
the meeting may appoint one or more persons as inspectors for such meeting.
Such inspectors shall ascertain and report the number of shares represented at
the meeting based upon their determination of the validity and effect of
proxies, count all votes, report the results and perform such other acts as are
proper to conduct the election and voting with impartiality and fairness to all
the shareholders.
Each report of an inspector shall be in writing and signed by him or by a
majority of them if there is more than one inspector acting at such meeting.
If there is more than one inspector,
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the report of a majority shall be the report of the inspectors. The report
of the inspector or inspectors on the number of shares represented at the
meeting and the results of the voting shall be prima facie evidence thereof.
Section 12. REPORTS TO SHAREHOLDERS. The Trustees shall submit to the
shareholders at or before the annual meeting of shareholders a report of the
business and operations of the Trust during such fiscal year, containing a
balance sheet and a statement of income and surplus of the Trust, accompanied
by the certification of an independent certified public accountant, and such
further information as the Trustees may determine is required pursuant to any
law or regulation to which the Trust is subject. Within the earlier of 20 days
after the annual meeting of shareholders or 120 days after the end of the
fiscal year of the Trust, the Trustees shall place the annual report on file at
the principal office of the Trust and with any governmental agencies as may be
required by law and as the Trustees may deem appropriate.
Section 13. NOMINATIONS AND PROPOSALS BY SHAREHOLDERS.
(a) Annual Meetings of Shareholders. (1) Nominations of persons
for election to the Board of Trustees and the proposal of business to be
considered by the shareholders may be made at an annual meeting of shareholders
(i) pursuant to the Trust's notice of meeting, (ii) by or at the direction of
the Trustees or (iii) by any shareholder of the Trust who was a shareholder of
record both at the time of giving of notice provided for in this Section 13 (a)
and at the time of the annual meeting, who is entitled to vote at the meeting
and who complied with the notice procedures set forth in this Section 13(a).
(2) For nominations or other business to be properly brought
before an annual meeting by a shareholder pursuant to clause (iii) of paragraph
(a) (1) of this Section 13, the shareholder must have given timely notice
thereof in writing to the Secretary of the Trust and such other business must
otherwise be a proper matter for action by shareholders. To be timely, a
shareholder's notice shall be delivered to the Secretary at the principal
executive offices of the Trust not later than the close of business on the 60th
day nor earlier than the close of business on the 90th day prior to the first
anniversary of the preceding year's annual meeting; provided, however, that in
the event that the date of the annual meeting is advanced by more than 30 days
or delayed by more than 60 days from such anniversary date or if the Trust has
not previously held an annual meeting, notice by the shareholder to be timely
must be so delivered not earlier than the close of business on the 90th day
prior to such annual meeting and not later than the close of business on the
later of the 60th day prior to such annual meeting or the tenth day following
the day on which public announcement of the date of such meeting is first made
by the Trust. In no event shall the public announcement of a postponement or
adjournment of an annual meeting to a later date or time commence a new time
period for the giving of a shareholder's notice as described above. Such
shareholder's notice shall set forth as to each person whom the shareholder
proposes to nominate for election or reelection as a Trustee all information
relating to such person that is required to be disclosed in solicitations of
proxies for election of Trustees in an election contest, or is otherwise
required, in each case pursuant to Regulation 14A under the Securities Exchange
Act of 1934, as amended (the "Exchange Act") (including such person's written
consent to being named in the proxy statement as a nominee and to serving as a
Trustee if elected); (ii) as to any other business that the shareholder
proposes to bring before the meeting, a brief description of the business
desired to be brought before the meeting, the reasons for conducting such
business at
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the meeting and any material interest in such business of such shareholder and
of the beneficial owner, if any, on whose behalf the proposal is made; and
(iii) as to the shareholder giving the notice and the beneficial owner, if any,
on whose behalf the nomination or proposal is made, (x) the name and address of
such shareholder, as they appear on the Trust's books, and of such beneficial
owner and (y) the number of each class of shares of the Trust which are owned
beneficially and of record by such shareholder and such beneficial owner.
(3) Notwithstanding anything in the second sentence of paragraph
(a) (2) of this Section 13 to the contrary, in the event that the number of
Trustees to be elected to the Board of Trustees is increased and there is no
public announcement by the Trust naming all of the nominees for Trustee or
specifying the size of the increased Board of Trustees at least 70 days prior
to the first anniversary of the preceding year's annual meeting, a
shareholder's notice required by this Section 13(a) shall also be considered
timely, but only with respect to nominees for any new positions created by such
increase, if it shall be delivered to the secretary at the principal executive
offices of the Trust not later than the close of business on the tenth day
following the day on which such public announcement is first made by the Trust.
(b) Special Meetings of Shareholders. Only such business shall be
conducted at a special meeting of shareholders as shall have been brought
before the meeting pursuant to the Trust's notice of meeting. Nominations of
persons for election to the Board of Trustees may be made at a special meeting
of shareholders at which Trustees are to be elected (i) pursuant to the Trusts
notice of meeting (ii) by or at the direction of the Board of Trustees or (iii)
provided that the Board of Trustees has determined that Trustees shall be
elected at such special meeting, by any shareholder of the Trust who was a
shareholder of record both at the time of giving of notice provided for in this
Section 13(b) and at the time of the special meeting, who is entitled to vote
at the meeting and who complied with the notice procedures set forth in this
Section 13 (b). In the event the Trust calls a special meeting of shareholders
for the purpose of electing one or more Trustees to the Board of Trustees, any
such shareholder may nominate a person or persons (as the case may be) for
election to such position as specified in the Trust's notice of meeting, if the
shareholder's notice containing the information required by paragraph (a) (2)
of this Section 13 shall be delivered to the Secretary at the principal
executive offices of the Trust not earlier than the close of business on the
90th day prior to such special meeting and not later than the close of business
on the later of the 60th day prior to such special meeting or the tenth day
following the day on which public announcement is first made of the date of the
special meeting and of the nominees proposed by the Trustees to be elected at
such meeting. In no event shall the public announcement of a postponement or
adjournment of a special meeting to a later date or time commence a new time
period for the giving of a shareholder's notice as described above.
(c) General. (1) Only such persons who are nominated in accordance with
the procedures set forth in this Section 13 shall be eligible to serve as
Trustees and only such business shall be conducted at a meeting of shareholders
as shall have been brought before the meeting in accordance with the procedures
set forth in this Section 13. The chairman of the meeting shall have the power
and duty to determine whether a nomination or any business proposed to be
brought before the meeting was made or proposed, as the case may be, in
accordance with the procedures set forth in this Section 13 and, if any
proposed nomination or business is not in compliance with this Section 13, to
declare that such nomination or proposal shall be disregarded.
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(2) For purposes of this Section 13, "public announcement" shall
mean disclosure in a press release reported by the Dow Jones News Service,
Associated Press or comparable news service or in a document publicly filed by
the Trust with the Securities and Exchange Commission pursuant to Section 13,
14 or 15(d) of the Exchange Act.
(3) Notwithstanding the foregoing provisions of this Section 13, a
shareholder shall also comply with all applicable requirements of state law and
of the Exchange Act and the rules and regulations thereunder with respect to
the matters set forth in this Section 13. Nothing in this Section 13 shall be
deemed to affect any rights of shareholders to request inclusion of proposals
in, nor any of the rights of the Trust to omit a proposal from, the Trust's
proxy statement pursuant to Rule 14a-8 under the Exchange Act.
Section 14. INFORMAL ACTION BY SHAREHOLDERS. Notwithstanding the
provisions of Section 13 of this Article II, any action required or permitted
to be taken at a meeting of shareholders may be taken without a meeting if a
consent in writing, setting forth such action, is signed by shareholders
entitled to cast a sufficient number of votes to approve the matter, as
required by statute, the Declaration of Trust of the Trust or these Bylaws, and
such consent is filed with the minutes of proceedings of the shareholders.
Section 15. VOTING BY BALLOT. Voting on any question or in any election
may be viva voce unless the presiding officer shall order or any shareholder
shall demand that voting be by ballot.
ARTICLE III
TRUSTEES
Section 1. GENERAL POWERS; QUALIFICATIONS; TRUSTEES HOLDING OVER. The
business and affairs of the Trust shall be managed under the direction of its
Board of Trustees. A Trustee shall be an individual at least 21 years of age
who is not under legal disability. In case of failure to elect Trustees at an
annual meeting of the shareholders, the Trustees holding over shall continue to
direct the management of the business and affairs of the Trust until their
successors are elected and qualify.
Section 2. NUMBER. At any regular meeting or at any special meeting
called for that purpose, a majority of the entire Board of Trustees may
establish, increase or decrease the number of Trustees, subject to any
limitations on the number of Trustees set forth in the Declaration of Trust.
Except during the period when a vacancy exists, at least two-thirds of the
Trustees shall be persons who are not executive officers of the Trust or
persons affiliated with Samuel Zell or his affiliates ("Independent Trustees").
For purposes of this Section, the terms "executive officers" and "affiliated"
shall have the definitions set forth in Rule 405 under the Securities Act of
1933, as amended.
Section 3. ANNUAL AND REGULAR MEETINGS. An annual meeting of the
Trustees shall be held immediately after and at the same place as the annual
meeting of shareholders, no notice other than this Bylaw being necessary. The
Trustees may provide, by resolution, the time and place, either within or
without the State of Maryland, for the holding of regular meetings of the
Trustees without other notice than such resolution.
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Section 4. SPECIAL MEETINGS. Special meetings of the Trustees may be
called by or at the request of the chairman of the board or the president or by
a majority of the Trustees then in office. The person or persons authorized to
call special meetings of the Trustees may fix any place, either within or
without the State of Maryland, as the place for holding any special meeting of
the Trustees called by them.
Section 5. NOTICE. Notice of any special meeting shall be given by
written notice delivered personally, telegraphed, facsimile-transmitted or
mailed to each Trustee at his business or residence address. Personally
delivered or telegraphed notices shall be given at least two days prior to the
meeting. Notice by mail shall be given at least five days prior to the
meeting. Telephone or facsimile-transmission notice shall be given at least 24
hours prior to the meeting. If mailed, such notice shall be deemed to be given
when deposited in the United States mail properly addressed, with postage
thereon prepaid. If given by telegram, such notice shall be deemed to be given
when the telegram is delivered to the telegraph company. Telephone notice
shall be deemed given when the Trustee is personally given such notice in a
telephone call to which he is a party. Facsimile-transmission notice shall be
deemed given upon completion of the transmission of the message to the number
given to the Trust by the Trustee and receipt of a completed answer-back
indicating receipt. Neither the business to be transacted at, nor the purpose
of, any annual, regular or special meeting of the Trustees need be stated in
the notice, unless specifically required by statute or these Bylaws.
Section 6. QUORUM. A majority of the Trustees shall constitute a quorum
for transaction of business at any meeting of the Trustees, provided that, if
less than a majority of such Trustees are present at said meeting, a majority
of the Trustees present may adjourn the meeting from time to time without
further notice, and provided further that if, pursuant to the Declaration of
Trust or these Bylaws, the vote of a majority of a particular group of Trustees
is required for action, a quorum must also include a majority of such group.
The Trustees present at a meeting which has been duly called and convened
may continue to transact business until adjournment, notwithstanding the
withdrawal of enough Trustees to leave less than a quorum.
Section 7. VOTING. The action of the majority of the Trustees present at
a meeting at which a quorum is present shall be the action of the Trustees,
unless the concurrence of a greater proportion is required for such action by
applicable statute.
Section 8. TELEPHONE MEETINGS. Trustees may participate in a meeting by
means of a conference telephone or similar communications equipment if all
persons participating in the meeting can hear each other at the same time.
Participation in a meeting by these means shall constitute presence in person
at the meeting.
Section 9. INFORMAL ACTION BY TRUSTEES. Any action required or permitted
to be taken at any meeting of the Trustees may be taken without a meeting, if a
consent in writing to such action is signed by each Trustee and such written
consent is filed with the minutes of proceedings of the Trustees.
Section 10. VACANCIES. If for any reason any or all of the Trustees
cease to be Trustees, such event shall not terminate the Trust or affect these
Bylaws or the powers of the
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remaining Trustees hereunder (even if fewer than two Trustees remain). Any
vacancy (including a vacancy created by an increase in the number of Trustees)
shall be filled, at any regular meeting or at any special meeting called for
that purpose, by a majority of the Trustees. Any individual so elected as
Trustee shall hold office until the next annual meeting of shareholders.
Section 11. COMPENSATION; FINANCIAL ASSISTANCE.
(a) Compensation. Trustees shall not receive any stated salary for their
services as Trustees but, by resolution of the Trustees, may receive fixed sums
per year and/or per meeting and/or per visit to real property owned or to be
acquired by the Trust and for any service or activity they performed or engaged
in as Trustees. Such fixed sums may be paid either in cash or in shares of the
Trust. Trustees may be reimbursed for expenses of attendance, if any, at each
annual, regular or special meeting of the Trustees or of any committee thereof;
and for their expenses, if any, in connection with each property visit and any
other service or activity performed or engaged in as Trustees; but nothing
herein contained shall be construed to preclude any Trustees from serving the
Trust in any other capacity and receiving compensation therefor.
(b) Financial Assistance to Trustees. The Trust may lend money to,
guarantee an obligation of or otherwise assist a Trustee or a trustee or
director of a direct or indirect subsidiary of the Trust; provided, however,
that such Trustee or other person is also an executive officer of the Trust or
of such subsidiary, or the loan, guarantee or other assistance is in connection
with the purchase of Shares. The loan, guarantee or other assistance may be
with or without interest, unsecured, or secured in any manner that the Board of
Trustees approves, including a pledge of shares.
Section 12. REMOVAL OF TRUSTEES. The shareholders may, at any time,
remove any Trustee in the manner provided in the Declaration of Trust.
Section 13. LOSS OF DEPOSITS. No Trustee shall be liable for any loss
which may occur by reason of the failure of the bank, trust company, savings
and loan association, or other institution with whom moneys or shares have been
deposited.
Section 14. SURETY BONDS. Unless required by law, no Trustee shall be
obligated to give any bond or surety or other security for the performance of
any of his duties.
Section 15. RELIANCE. Each Trustee, officer, employee and agent of the
Trust shall, in the performance of his duties with respect to the Trust, be
fully justified and protected with regard to any act or failure to act in
reliance in good faith upon the books of account or other records of the Trust,
upon an opinion of counsel or upon reports made to the Trust by any of its
officers or employees or by the adviser, accountants, appraisers or other
experts or consultants selected by the Trustees or officers of the Trust,
regardless of whether such counsel or expert may also be a Trustee.
Section 16. INTERESTED TRUSTEE TRANSACTIONS. Section 2-419 of the
Maryland General Corporation Law (the "MGCL") shall be available for and apply
to any contract or other transaction between the Trust and any of its Trustees
or between the Trust and any other trust,
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corporation, firm or other entity in which any of its Trustees is a trustee or
director or has a material financial interest.
Section 17. CERTAIN RIGHTS OF TRUSTEES, OFFICERS, EMPLOYEES AND AGENTS.
The Trustees shall have no responsibility to devote their full time to the
affairs of the Trust. Any Trustee or officer, employee or agent of the Trust
(other than a full-time officer, employee or agent of the Trust), in his
personal capacity or in a capacity as an affiliate, employee, or agent of any
other person, or otherwise, may have business interests and engage in business
activities similar or in addition to those of or relating to the Trust.)
ARTICLE IV
COMMITTEES
Section 1. NUMBER, TENURE AND QUALIFICATION. The Trustees may appoint
from among its members an Audit Committee, a Compensation Committee and other
committees, each composed of at least three Trustees, to serve at the pleasure
of the Trustees. A majority of the Trustees on the Compensation Committee and
all of the Trustees on the Audit Committee shall be Independent Trustees. In
addition, the Trustees may from time to time appoint from among its members a
Pricing Committee composed of one or more Trustees to serve at the pleasure of
the Trustees.
Section 2. POWERS. The Trustees may delegate to committees appointed
under Section 1 of this Article any of the powers of the Trustees, except as
prohibited by law.
Section 3. MEETINGS. In the absence of any member of any such
committee, the members thereof present at any meeting, whether or not they
constitute a quorum, may appoint another Trustee to act in the place of such
absent member. Notice of committee meetings shall be given in the same manner
as notice for special meetings of the Board of Trustees.
One-third, but not less than two (except for one-member committees), of
the members of any committee shall be present in person at any meeting of such
committee in order to constitute a quorum for the transaction of business at
such meeting, and the act of a majority present shall be the act of such
committee. The Board of Trustees may designate a chairman of any committee,
and such chairman or any two members of any committee (except for one-member
committees) may fix the time and place of its meetings unless the Board shall
otherwise provide. In the absence or disqualification of any member of any
such committee, the members thereof present at any meeting and not disqualified
from voting, whether or not they constitute a quorum, may unanimously appoint
another Trustee to act at the meeting in the place of such absent or
disqualified members.
Each committee shall keep minutes of its proceedings and shall report the
same to the Board of Trustees at the next succeeding meeting, and any action by
the committee shall be subject to revision and alteration by the Board of
Trustees, provided that no rights of third persons shall be affected by any
such revision or alteration.
Section 4. TELEPHONE MEETINGS. Members of a committee of the Trustees
may participate in a meeting by means of a conference telephone or similar
communications
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equipment if all persons participating in the meeting can hear each other at
the same time. Participation in a meeting by these means shall constitute
presence in person at the meeting.
Section 5. INFORMAL ACTION BY COMMITTEES. Any action required or
permitted to be taken at any meeting of a committee of the Trustees may be
taken without a meeting, if a consent in writing to such action is signed by
each member of the committee and such written consent is filed with the minutes
of proceedings of such committee.
Section 6. VACANCIES. Subject to the provisions hereof, the Board of
Trustees shall have the power at any time to change the membership of any
committee, to fill all vacancies, to designate alternate members to replace any
absent or disqualified member or to dissolve any such committee.
ARTICLE V
OFFICERS
Section 1. GENERAL PROVISIONS. The officers of the Trust shall include a
president, a secretary and a treasurer and may include a chairman of the board,
a vice chairman of the board, a chief executive officer, a chief operating
officer, a chief financial officer, a chief legal counsel, one or more vice
presidents, one or more assistant secretaries and one or more assistant
treasurers. In addition, the Trustees may from time to time appoint such other
officers with such powers and duties as they shall deem necessary or desirable.
The officers of the Trust shall be elected annually by the Trustees at the
first meeting of the Trustees held after each annual meeting of shareholders.
If the election of officers shall not be held at such meeting, such election
shall be held as soon thereafter as may be convenient. Each officer shall hold
office until his successor is elected and qualifies or until his death,
resignation or removal in the manner hereinafter provided. Any two or more
offices except president and vice president may be held by the same person. In
their discretion, the Trustees may leave unfilled any office except that of
president and secretary. Election of an officer or agent shall not of itself
create contract rights between the Trust and such officer or agent.
Section 2. REMOVAL AND RESIGNATION. Any officer or agent of the Trust
may be removed by the Trustees if in their judgment the best interests of the
Trust would be served thereby, but such removal shall be without prejudice to
the contract rights, if any, of the person so removed. Any officer of the
Trust may resign at any time by giving written notice of his resignation to the
Trustees, the chairman of the board, the president or the secretary. Any
resignation shall take effect at any time subsequent to the time specified
therein or, if the time when it shall become effective is not specified
therein, immediately upon its receipt. The acceptance of a resignation shall
not be necessary to make it effective unless otherwise stated in the
resignation. Such resignation shall be without prejudice to the contract
rights, if any, of the Trust.
Section 3. VACANCIES. A vacancy in any office may be filled by the
Trustees for the balance of the term.
Section 4. CHIEF EXECUTIVE OFFICER. The Trustees may designate a chief
executive officer from among the elected officers. The chief executive officer
shall have
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responsibility for implementation of the policies of the Trust, as determined
by the Trustees, and for the administration of the business affairs of the
Trust. In the absence of both the chairman and vice chairman of the board, the
chief executive officer shall preside over the meetings of the Trustees and of
the shareholders at which he shall be present.
Section 5. CHIEF OPERATING OFFICER. The Trustees may designate a chief
operating officer from among the elected officers. Said officer will have the
responsibilities and duties as set forth by the Trustees or the chief executive
officer.
Section 6. CHIEF FINANCIAL OFFICER. The Trustees may designate a chief
financial officer from among the elected officers. Said officer will have the
responsibilities and duties as set forth by the Trustees or the chief executive
officer.
Section 7. CHIEF LEGAL COUNSEL. The Trustees may designate a chief legal
counsel from among the elected officers. Said officer will have the
responsibilities and duties as set forth by the trustees or the chief executive
officer.
Section 8. CHAIRMAN AND VICE CHAIRMAN OF THE BOARD. The chairman of the
board shall preside over the meetings of the Trustees and of the shareholders
at which he shall be present and shall in general oversee all of the business
and affairs of the Trust. In the absence of the chairman of the board, the
vice chairman of the board shall preside at such meetings at which he shall be
present. The chairman and the vice chairman of the board may execute any deed,
mortgage, bond, contract or other instrument, except in cases where the
execution thereof shall be expressly delegated by the Trustees or by these
Bylaws to some other officer or agent of the Trust or shall be required by law
to be otherwise executed. The chairman of the board and the vice chairman of
the board shall perform such other duties as may be assigned to him or them by
the Trustees.
Section 9. PRESIDENT. In the absence of the chairman, the vice chairman
of the board and the chief executive officer, the president shall preside over
the meetings of the Trustees and of the shareholders at which he shall be
present. In the absence of a designation of a chief executive officer by the
Trustees, the president shall be the chief executive officer and shall be ex
officio a member of all committees that may, from time to time, be constituted
by the Trustees. The president may execute any deed, mortgage, bond, contract
or other instrument, except in cases where the execution thereof shall be
expressly delegated by the Trustees or by these Bylaws to some other officer or
agent of the Trust or shall be required by law to be otherwise executed; and in
general shall perform all duties incident to the office of president and such
other duties as may be prescribed by the Trustees from time to time.
Section 10. VICE PRESIDENTS. In the absence of the president or in the
event of a vacancy in such office, the vice president (or in the event there be
more than one vice president, the vice presidents in the order designated at
the time of their election or, in the absence of any designation, then in the
order of their election) shall perform the duties of the president and when so
acting shall have all the powers of and be subject to all the restrictions upon
the president; and shall perform such other duties as from time to time may be
assigned to him by the president or by the Trustees. The Trustees may
designate one or more vice presidents as executive vice president, senior vice
president or as vice president for particular areas of responsibility.
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Section 11. SECRETARY. The secretary shall (a) keep the minutes of the
proceedings of the shareholders, the Trustees and committees of the Trustees in
one or more books provided for that purpose; (b) see that all notices are duly
given in accordance with the provisions of these Bylaws or as required by law;
(c) be custodian of the trust records and of the seal of the Trust; (d) keep a
register of the post office address of each shareholder which shall be
furnished to the secretary by such shareholder; (e) have general charge of the
share transfer books of the Trust; and (f) in general perform such other duties
as from time to time may be assigned to him by the chief executive officer, the
president or by the Trustees.
Section 12. TREASURER. The treasurer shall have the custody of the funds
and securities of the Trust and shall keep full and accurate accounts of
receipts and disbursements in books belonging to the Trust and shall deposit
all moneys and other valuable effects in the name and to the credit of the
Trust in such depositories as may be designated by the Trustees.
He shall disburse the funds of the Trust as may be ordered by the
Trustees, taking proper vouchers for such disbursements, and shall render to
the president and Trustees, at the regular meetings of the Trustees or whenever
they may require it, an account of all his transactions as treasurer and of the
financial condition of the Trust.
If required by the Trustees, he shall give the Trust a bond in such sum
and with such surety or sureties as shall be satisfactory to the Trustees for
the faithful performance of the duties of his office and for the restoration to
the Trust, in case of his death, resignation, retirement or removal from
office, of all books, papers, vouchers, moneys and other property of whatever
kind in his possession or under his control belonging to the Trust.
Section 13. ASSISTANT SECRETARIES AND ASSISTANT TREASURERS. The
assistant secretaries and assistant treasurers, in general, shall perform such
duties as shall be assigned to them by the secretary or treasurer,
respectively, or by the president or the Trustees. The assistant treasurers
shall, if required by the Trustees, give bonds for the faithful performance of
their duties in such sums and with such surety or sureties as shall be
satisfactory to the Trustees.
Section 14. SALARIES. The salaries and other compensation of the
officers shall be fixed from time to time by the Trustees and no officer shall
be prevented from receiving such salary or other compensation by reason of the
fact that he is also a Trustee.
ARTICLE VI
CONTRACTS, LOANS, CHECKS AND DEPOSITS
Section 1. CONTRACTS. The Trustees may authorize any officer or agent to
enter into any contract or to execute and deliver any instrument in the name of
and on behalf of the Trust and such authority may be general or confined to
specific instances. Any agreement, deed, mortgage, lease or other document
executed by one or more of the Trustees or by an authorized person shall be
valid and binding upon the Trustees and upon the Trust when authorized or
ratified by action of the Trustees.
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Section 2. CHECKS AND DRAFTS. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name
of the Trust shall be signed by such officer or agent of the Trust in such
manner as shall from time to time be determined by the Trustees.
Section 3. DEPOSITS. All funds of the Trust not otherwise employed shall
be deposited from time to time to the credit of the Trust in such banks, trust
companies or other depositories as the Trustees may designate.
ARTICLE VII
SHARES
Section 1. CERTIFICATES. Each shareholder shall be entitled to a
certificate or certificates which shall represent and certify the number of
shares of each class of beneficial interest held by him in the Trust. Each
certificate shall be signed by the chief executive officer, the president or a
vice president and countersigned by the secretary or an assistant secretary or
the treasurer or an assistant treasurer and may be sealed with the seal, if
any, of the Trust. The signatures may be either manual or facsimile.
Certificates shall be consecutively numbered; and if the Trust shall, from time
to time, issue several classes of shares, each class may have its own number
series. A certificate is valid and may be issued whether or not an officer who
signed it is still an officer when it is issued. Each certificate representing
shares which are restricted as to their transferability or voting powers, which
are preferred or limited as to their dividends or as to their allocable portion
of the assets upon liquidation or which are redeemable at the option of the
Trust, shall have a statement of such restriction, limitation, preference or
redemption provision, or a summary thereof, plainly stated on the certificate.
In lieu of such statement or summary, the Trust may set forth upon the face or
back of the certificate a statement that the Trust will furnish to any
shareholder, upon request and without charge, a full statement of such
information.
Section 2. TRANSFERS. Certificates shall be treated as negotiable and
title thereto and to the shares they represent shall be transferred by delivery
thereof to the same extent as those of a Maryland stock corporation. Upon
surrender to the Trust or the transfer agent of the Trust of a share
certificate duly endorsed or accompanied by proper evidence of succession,
assignment or authority to transfer, the Trust shall issue a new certificate to
the person entitled thereto, cancel the old certificate and record the
transaction upon its books.
The Trust shall be entitled to treat the holder of record of any share or
shares as the holder in fact thereof and, accordingly, shall not be bound to
recognize any equitable or other claim to or interest in such share or shares
on the part of any other person, whether or not it shall have express or other
notice thereof, except as otherwise provided by the laws of the State of
Maryland.
Notwithstanding the foregoing, transfers of shares of beneficial interest
of the Trust will be subject in all respects to the Declaration of Trust and
all of the terms and conditions contained therein.
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Section 3. REPLACEMENT CERTIFICATE. Any officer designated by the
Trustees may direct a new certificate to be issued in place of any certificate
previously issued by the Trust alleged to have been lost, stolen or destroyed
upon the making of an affidavit of that fact by the person claiming the
certificate to be lost, stolen or destroyed. When authorizing the issuance of
a new certificate, an officer designated by the Trustees may, in his discretion
and as a condition precedent to the issuance thereof, require the owner of such
lost, stolen or destroyed certificate or the owner's legal representative to
advertise the same in such manner as he shall require and/or to give bond, with
sufficient surety, to the Trust to indemnify it against any loss or claim which
may arise as a result of the issuance of a new certificate.
Section 4. CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD DATE. The
Trustees may set, in advance, a record date for the purpose of determining
shareholders entitled to notice of or to vote at any meeting of shareholders or
determining shareholders entitled to receive payment of any dividend or the
allotment of any other rights, or in order to make a determination of
shareholders for any other proper purpose. Such date, in any case, shall not
be prior to the close of business on the day the record date is fixed and shall
be not more than 90 days and, in the case of a meeting of shareholders not less
than ten days, before the date on which the meeting or particular action
requiring such determination of shareholders of record is to be held or taken.
In lieu of fixing a record date, the Trustees may provide that the share
transfer books shall be closed for a stated period but not longer than 20 days.
If the share transfer books are closed for the purpose of determining
shareholders entitled to notice of or to vote at a meeting of shareholders,
such books shall be closed for at least ten days before the date of such
meeting.
If no record date is fixed and the share transfer books are not closed for
the determination of shareholders, (a) the record date for the determination of
shareholders entitled to notice of or to vote at a meeting of shareholders
shall be at the close of business on the day on which the notice of meeting is
mailed or the 30th day before the meeting, whichever is the closer date to the
meeting; and (b) the record date for the determination of shareholders entitled
to receive payment of a dividend or an allotment of any other rights shall be
the close of business on the day on which the resolution of the Trustees,
declaring the dividend or allotment of rights, is adopted.
When a determination of shareholders entitled to vote at any meeting of
shareholders has been made as provided in this section, such determination
shall apply to any adjournment thereof, except when (i) the determination has
been made through the closing of the transfer books and the stated period of
closing has expired or (ii) the meeting is adjourned to a date more than 120
days after the record date fixed for the original meeting, in either of which
case a new record date shall be determined as set forth herein.
Section 5. STOCK LEDGER. The Trust shall maintain at its principal
office or at the office of its counsel, accountants or transfer agent, an
original or duplicate share ledger containing the name and address of each
shareholder and the number of shares of each class held by such shareholder.
Section 6. FRACTIONAL SHARES; ISSUANCE OF UNITS. The Trustees may issue
fractional shares or provide for the issuance of scrip, all on such terms and
under such
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conditions as they may determine. Notwithstanding any other provision of the
Declaration of Trust or these Bylaws, the Trustees may issue units consisting
of different securities of the Trust. Any security issued in a unit shall have
the same characteristics as any identical securities issued by the Trust,
except that the Trustees may provide that for a specified period securities of
the Trust issued in such unit may be transferred on the books of the Trust only
in such unit.
ARTICLE VIII
ACCOUNTING YEAR
The Trustees shall have the power, from time to time, to fix the fiscal
year of the Trust by a duly adopted resolution.
ARTICLE IX
DISTRIBUTIONS
Section 1. AUTHORIZATION. Dividends and other distributions upon the
shares of beneficial interest of the Trust may be authorized and declared by
the Trustees, subject to the provisions of law and the Declaration of Trust.
Dividends and other distributions may be paid in cash, property or shares of
the Trust, subject to the provisions of law and the Declaration of Trust.
Section 2. CONTINGENCIES. Before payment of any dividends or other
distributions, there may be set aside out of any funds of the Trust available
for dividends or other distributions such sum or sums as the Trustees may from
time to time, in their absolute discretion, think proper as a reserve fund for
contingencies, for equalizing dividends or other distributions, for repairing
or maintaining any property of the Trust or for such other purpose as the
Trustees shall determine to be in the best interest of the Trust, and the
Trustees may modify or abolish any such reserve in the manner in which it was
created.
ARTICLE X
PROHIBITED INVESTMENTS AND ACTIVITIES;
INVESTMENT POLICIES
Notwithstanding anything to the contrary in the Declaration of Trust, the
Trust shall not enter into any transaction referred to in (i), (ii) or (iii)
below which it does not believe is in the best interests of the Trust, and will
not, without the approval of a majority of the disinterested Trustees, (i)
acquire from or sell to any Trustee, officer or employee of the Trust, any
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise in which a Trustee, officer or employee of the Trust owns more than
a one percent interest or any affiliate of any of the foregoing, any of the
assets or other property of the Trust, except for the acquisition directly or
indirectly of certain properties or interest therein, directly or indirectly,
through entities in which it owns an interest in connection with the initial
public offering of
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shares by the Trust or pursuant to agreements entered into in connection with
such offering, which properties shall be described in the prospectus relating
to such initial public offering, (ii) make any loan to or borrow from any of
the foregoing persons or (iii) engage in any other transaction with any of the
foregoing persons. Each such transaction will be in all respects on such terms
as are, at the time of the transaction and under the circumstances then
prevailing, fair and reasonable to the Trust. Subject to the foregoing and the
provisions of the Declaration of Trust, the Board of Trustees may from time to
time adopt, amend, revise or terminate any policy or policies with respect to
investments by the Trust as it shall deem appropriate in its sole discretion.
ARTICLE XI
SEAL
Section 1. SEAL. The Trustees may authorize the adoption of a seal by
the Trust. The seal shall have inscribed thereon the name of the Trust and the
year of its formation. The Trustees may authorize one or more duplicate seals
and provide for the custody thereof.
Section 2. AFFIXING SEAL. Whenever the Trust is permitted or required to
affix its seal to a document, it shall be sufficient to meet the requirements
of any law, rule or regulation relating to a seal to place the word "(SEAL)"
adjacent to the signature of the person authorized to execute the document on
behalf of the Trust.
ARTICLE XII
INDEMNIFICATION AND ADVANCE OF EXPENSES
To the maximum extent permitted by Maryland law in effect from time to
time, the Trust shall indemnify (a) any Trustee, officer or shareholder or any
former Trustee, officer or shareholder (including among the foregoing, for all
purposes of this Article XII and without limitation, any individual who, while
a Trustee, officer or shareholder and at the express request of the Trust,
serves or has served another corporation, partnership, joint venture, trust,
employee benefit plan or any other enterprise as a director, officer,
shareholder, partner or trustee of such corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise) who has been
successful, on the merits or otherwise, in the defense of a proceeding to which
he was made a party by reason of service in such capacity, against reasonable
expenses incurred by him in connection with the proceeding, (b) any Trustee or
officer or any former Trustee or officer against any claim or liability to
which he may become subject by reason of such status unless it is established
that (i) his act or omission was material to the matter giving rise to the
proceeding and was committed in bad faith or was the result of active and
deliberate dishonesty, (ii) he actually received an improper personal benefit
in money, property or services or (iii) in the case of a criminal proceeding,
he had reasonable cause to believe that his act or omission was unlawful and
(c) each shareholder or former shareholder against any claim or liability to
which he may become subject by reason of such status. In addition, the Trust
shall, without requiring a preliminary determination of the ultimate
entitlement to indemnification, pay or reimburse, in advance of final
disposition of a proceeding, reasonable expenses incurred by a Trustee, officer
or shareholder or former Trustee, officer or shareholder
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made a party to a proceeding by reason such status, provided that, in the case
of a Trustee or officer, the Trust shall have received (i) a written
affirmation by the Trustee or officer of his good faith belief that he has met
the applicable standard of conduct necessary for indemnification by the Trust
as authorized by these Bylaws and (ii) a written undertaking by or on his
behalf to repay the amount paid or reimbursed by the Trust if it shall
ultimately be determined that the applicable standard of conduct was not met.
The Trust may, with the approval of its Trustees, provide such indemnification
or payment or reimbursement of expenses to any Trustee, officer or shareholder
or any former Trustee, officer or shareholder who served a predecessor of the
Trust and to any employee or agent of the Trust or a predecessor of the Trust.
Neither the amendment nor repeal of this Article, nor the adoption or amendment
of any other provision of the Declaration of Trust or these Bylaws inconsistent
with this Article, shall apply to or affect in any respect the applicability of
this Article with respect to any act or failure to act which occurred prior to
such amendment, repeal or adoption.
Any indemnification or payment or reimbursement of the expenses permitted
by these Bylaws shall be furnished in accordance with the procedures provided
for indemnification or payment or reimbursement of expenses, as the case may
be, under Section 2-418 of the MGCL for directors of Maryland corporations.
The Trust may provide to Trustees, officers and shareholders such other and
further indemnification or payment or reimbursement of expenses, as the case
may be, to the fullest extent permitted by the MGCL, as in effect from time to
time, for directors of Maryland corporations.
ARTICLE XIII
WAIVER OF NOTICE
Whenever any notice is required to be given pursuant to the Declaration of
Trust or Bylaws or pursuant to applicable law, a waiver thereof in writing,
signed by the person or persons entitled to such notice, whether before or
after the time stated therein, shall be deemed equivalent to the giving of such
notice. Neither the business to be transacted at nor the purpose of any
meeting need be set forth in the waiver of notice, unless specifically required
by statute. The attendance of any person at any meeting shall constitute a
waiver of notice of such meeting, except where such person attends a meeting
for the express purpose of objecting to the transaction of any business on the
ground that the meeting is not lawfully called or convened.
ARTICLE XIV
AMENDMENT OF BYLAWS
The Trustees shall have the power to adopt, alter or repeal any provision
of these Bylaws and to make new Bylaws; provided, however, that Article II,
Section 2 of Article III and this Article XIV of these Bylaws shall not be
amended without the consent of shareholders by a vote of a majority of the
votes cast at a meeting of shareholders duly called and at which a quorum is
present.
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ARTICLE XV
MISCELLANEOUS
All references to the Declaration of Trust shall include any amendments
thereto.
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