<PAGE>
As filed with the Securities and Exchange Commission on December 7, 1995
REGISTRATION STATEMENT NO.
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______
FORM S-4
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
______
BRADLEY REAL ESTATE, INC.
(Exact Name of Registrant as Specified in its Charter)
MARYLAND 6798 04-6034603
(State or Other (Primary Standard Industrial (I.R.S. Employer
Jurisdiction of Classification Code) Identification No.)
Incorporation or
Organization)
699 BOYLSTON STREET
BOSTON, MA 02116
(617) 867-4200
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Office)
_____________________
E. LAWRENCE MILLER
PRESIDENT AND CHIEF EXECUTIVE OFFICER
BRADLEY REAL ESTATE, INC.
699 BOYLSTON STREET
BOSTON, MA 02116
(617) 867-4200
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent for Service)
______
Copies to:
WILLIAM B. KING, P.C. EDWARD J. SCHNEIDMAN, ESQ.
JOSEPH L. JOHNSON III, ESQ. STUART M. LITWIN, ESQ.
GOODWIN, PROCTER & HOAR MAYER, BROWN & PLATT
EXCHANGE PLACE 190 S. LASALLE STREET
BOSTON, MA 02109-2881 CHICAGO, IL 60603-3441
(617) 570-1000 (312) 782-0600
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: Upon
consummation of the merger of Tucker Properties Corporation ("Tucker") with and
into Bradley Real Estate, Inc. ("Bradley") pursuant to an Agreement and Plan of
Merger dated as of October 30, 1995 described in the enclosed Joint Proxy
Statement/Prospectus.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [_]
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
====================================================================================================================================
Proposed Maximum Proposed Maximum
Title of Each Class Amount Offering Aggregate Amount of
of Securities to be Registered to be Registered (1) Price Per Unit (2) Offering Price (2) Registration Fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01 7,428,202 $13.21 $98,126,548 $33,837
per share
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents the estimated maximum number of shares of common stock of
Bradley to be issued to stockholders of Tucker in the merger of Tucker with
and into Bradley.
(2) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(f)(1) and based on the average of the high and low
sales price per share of common stock of Tucker on December 4, 1995, on the
New York Stock Exchange. If the Merger described herein is consummated, a
maximum of six hundred eighty-six thousandths (.686) of a share of common
stock of Bradley will be issued for every one share of common stock of
Tucker.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
================================================================================
<PAGE>
BRADLEY REAL ESTATE, INC.
Cross-Reference Sheet Pursuant to Rule 404(a) of Regulation C and Item
501(b) of Regulation S-K showing the Location in the Joint Proxy
Statement/Prospectus of the Information Required by Part I of Form S-4.
<TABLE>
<CAPTION>
LOCATION OR HEADING IN
ITEM OF FORM S-4 JOINT PROXY STATEMENT/PROSPECTUS
---------------- --------------------------------
<S> <C>
A. INFORMATION ABOUT THE TRANSACTION
1. Forepart of Registration Statement and
Outside Front Cover Page of Prospectus......... Facing Page of Registration Statement;
Outside Front Cover Page of Joint Proxy
Statement/Prospectus
2. Inside Front and Outside Back Cover Pages of
Prospectus..................................... Available Information; Incorporation of
Documents by Reference; Table of Contents
3. Risk Factors, Ratio of Earnings to Fixed
Charges and Other Information.................. Outside Front Cover Page of Joint Proxy
Statement/Prospectus; Summary; Risk
Factors; The Companies
4. Terms of the Transaction....................... Summary; The Merger; The Merger
Agreement; Comparison of Stockholder
Rights
5. Pro Forma Financial Information................ Summary; Unaudited Pro Forma Combined
Financial Statements
6. Material Contacts with the Company Being
Acquired....................................... Summary; The Merger; The Merger
Agreement
7. Additional Information Required for
Reoffering by Persons and Parties
Deemed to be Underwriters...................... *
8. Interests of Named Experts and Counsel......... Summary; The Merger; Legal Matters; Experts
9. Disclosure of Commission Position on
Indemnification For Securities Act
Liabilities.................................... *
B. INFORMATION ABOUT THE REGISTRANT
10. Information with Respect to S-3 Registrants.... Available Information; Incorporation of
Documents by Reference; The Companies
11. Incorporation of Certain Information by
Reference...................................... Available Information; Incorporation of
Documents by Reference
</TABLE>
<PAGE>
<TABLE>
<S> <C>
12. Information with Respect to S-2 or S-3
Registrants.................................... *
13. Incorporation of Certain Information by
Reference...................................... *
14. Information with Respect to Registrants Other
Than S-3 or S-2 Registrants.................... *
C. INFORMATION ABOUT THE COMPANY BEING ACQUIRED
15. Information with Respect to S-3 Companies...... Available Information; Incorporation of
Documents by Reference; The Companies
16. Information with Respect to S-2 or S-3
Companies...................................... *
17. Information with Respect to Companies Other
Than S-2 or S-3 Companies...................... *
D. VOTING AND MANAGEMENT INFORMATION
18. Information if Proxies, Consents or
Authorizations are to be Solicited............. Outside Front Cover Page of Joint Proxy
Statement/Prospectus; Available Information;
Incorporation of Documents by Reference;
Summary; The Merger; The Meetings of
Stockholders; Stockholder Proposals
19. Information if Proxies, Consents or
Authorizations Are Not to be Solicited, or
in an Exchange Offer........................... *
</TABLE>
______________________________
* Item is omitted because answer is negative or Item is inapplicable.
<PAGE>
BRADLEY REAL ESTATE, INC.
699 BOYLSTON STREET
BOSTON, MASSACHUSETTS 02116
January __, 1996
Dear Stockholder:
You are cordially invited to attend a Special Meeting of Stockholders of
Bradley Real Estate, Inc. ("Bradley") to be held at 10:00 a.m., Eastern time, on
February __, 1996, at __________________________, Boston, Massachusetts ______
(the "Special Meeting").
At the Special Meeting, you will be asked to approve the merger of Tucker
Properties Corporation ("Tucker") with and into Bradley (the "Merger") and the
Agreement and Plan of Merger, dated as of October 30, 1995 (the "Merger
Agreement"), by and between Bradley and Tucker, pursuant to which, among other
things, each outstanding share of Tucker common stock will be converted into the
right to receive a percentage of a share of Bradley common stock to be
determined as follows. If the average per share closing price of Bradley common
stock for the 20 trading days prior to the fifth day preceding the closing of
the Merger is $16.00 or more, each share of Tucker common stock will be
exchanged for .665 of a share of Bradley common stock. If such average closing
price is between $15.50 and $16.00, the exchange ratio will be determined by
dividing $10.64 by the average closing price. If such average closing price is
$15.50 or less, the exchange ratio will be .686 of a share of Bradley common
stock. Approval of the Merger and the Merger Agreement requires the affirmative
vote of the holders of a majority of the outstanding shares of Bradley common
stock.
YOUR BOARD OF DIRECTORS BELIEVES THAT THE MERGER IS FAIR TO, AND IN THE BEST
INTERESTS OF, BRADLEY AND ITS STOCKHOLDERS. THE BOARD HAS UNANIMOUSLY APPROVED
THE MERGER AND THE MERGER AGREEMENT AND UNANIMOUSLY RECOMMENDS THAT YOU VOTE TO
APPROVE THE MERGER AND THE MERGER AGREEMENT.
The accompanying Joint Proxy Statement/Prospectus provides detailed
information concerning the proposed Merger, the reasons for your Board of
Directors' recommendation of the Merger and the Merger Agreement and certain
additional information, including, without limitation, the information set forth
under the heading "Risk Factors," which describes, among other items, potential
adverse effects to stockholders as a result of the Merger. We urge you to
carefully consider all of the information in the Joint Proxy
Statement/Prospectus. It is important that your shares of Bradley common stock
be represented at the Special Meeting, regardless of the number of shares you
hold. Therefore, please sign, date and return your proxy card as soon as
possible, whether or not you plan to attend the Special Meeting. This will not
prevent you from voting your shares in person if you subsequently choose to
attend the Special Meeting.
Sincerely,
E. LAWRENCE MILLER
President and Chief Executive Officer
<PAGE>
BRADLEY REAL ESTATE, INC.
699 BOYLSTON STREET
BOSTON, MASSACHUSETTS 02116
__________________
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON FEBRUARY __, 1996
__________________
To the Stockholders of Bradley Real Estate, Inc.:
A Special Meeting of Stockholders of Bradley Real Estate, Inc., a Maryland
corporation ("Bradley"), will be held at 10:00 a.m., Eastern time, on February
__, 1996, at ______________________, Boston, Massachusetts _____ (the "Special
Meeting") for the following purposes:
1. To consider and vote upon a proposal to approve the merger of
Tucker Properties Corporation ("Tucker") with and into Bradley (the
"Merger") and the Agreement and Plan of Merger, dated as of October 30, 1995
(the "Merger Agreement"), by and between Bradley and Tucker, pursuant to
which, among other things, each outstanding share of Tucker common stock
will be converted into the right to receive a percentage of a share of
Bradley common stock to be determined as follows. If the average per share
closing price of Bradley common stock for the 20 trading days prior to the
fifth day preceding the closing of the Merger is $16.00 or more, each share
of Tucker common stock will be exchanged for .665 of a share of Bradley
common stock. If such average closing price is between $15.50 and $16.00,
the exchange ratio will be determined by dividing $10.64 by the average
closing price. If such average closing price is $15.50 or less, the exchange
ratio will be .686 of a share of Bradley common stock. A copy of the Merger
Agreement is attached as Annex A to the Joint Proxy Statement/Prospectus
accompanying this Notice.
2. To transact such other business as may properly come before the
meeting or any adjournments or postponements thereof.
Holders of record of shares of Bradley common stock at the close of business
on January __, 1996 are entitled to notice of, and to vote at, the Special
Meeting. The Merger and other related matters are more fully described in the
accompanying Joint Proxy Statement/Prospectus, and the Annexes thereto, which
form a part of this Notice.
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE SPECIAL MEETING. TO
ENSURE YOUR REPRESENTATION AT THE SPECIAL MEETING, HOWEVER, YOU ARE URGED TO
COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE. A
POSTAGE-PREPAID ENVELOPE IS ENCLOSED FOR THAT PURPOSE. ANY STOCKHOLDER ATTENDING
THE SPECIAL MEETING MAY VOTE IN PERSON EVEN IF THAT STOCKHOLDER HAS RETURNED A
PROXY.
By Order of the Board of Directors
WILLIAM B. KING
Secretary
January __, 1996
<PAGE>
TUCKER PROPERTIES CORPORATION
40 SKOKIE BOULEVARD, SUITE 600
NORTHBROOK, ILLINOIS 60062
January __, 1996
Dear Stockholder:
You are cordially invited to attend a Special Meeting of Stockholders of
Tucker Properties Corporation ("Tucker") to be held at 9:00 a.m., Central time,
on February __, 1996, at ____________________________, Chicago, Illinois _____
(the "Special Meeting").
At the Special Meeting, you will be asked to approve the merger (the
"Merger") of Tucker with and into Bradley Real Estate, Inc. ("Bradley") and the
Agreement and Plan of Merger, dated as of October 30, 1995 (the "Merger
Agreement"), by and between Bradley and Tucker, pursuant to which, among other
things, each outstanding share of Tucker common stock will be converted into the
right to receive a percentage of a share of Bradley common stock to be
determined as follows. If the average per share closing price of Bradley common
stock for the 20 trading days prior to the fifth day preceding the closing of
the Merger is $16.00 or more, each share of Tucker common stock will be
exchanged for .665 of a share of Bradley common stock. If such average closing
price is between $15.50 and $16.00, the exchange ratio will be determined by
dividing $10.64 by the average closing price. If such average closing price is
$15.50 or less, the exchange ratio will be .686 of a share of Bradley common
stock. Approval of the Merger and the Merger Agreement requires the affirmative
vote of the holders of two-thirds of the outstanding shares of Tucker common
stock.
YOUR BOARD OF DIRECTORS BELIEVES THAT THE MERGER IS FAIR TO, AND IN THE BEST
INTERESTS OF, TUCKER AND ITS STOCKHOLDERS. THE BOARD OF DIRECTORS HAS
UNANIMOUSLY APPROVED THE MERGER AND THE MERGER AGREEMENT.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE TO APPROVE THE
MERGER AND THE MERGER AGREEMENT.
Bradley, as the surviving entity after the Merger, will be a leading owner
and operator of community shopping centers in the Midwest, and its increased
number of properties and gross leasing area are likely to better attract
national tenants. The Tucker Board of Directors believes that the combined
entity will be significantly less leveraged than Tucker and will benefit from
Tucker's field management capabilities and property level operating systems. In
addition, the Board of Directors believes that, to the extent operations of
Tucker and Bradley are integrated following the Merger, cost reductions and
other efficiencies will be likely. The Merger is intended to enable Tucker's
stockholders to exchange their shares of Tucker common stock for Bradley common
stock on a tax-free basis.
The Tucker Board of Directors believes that the Merger provides an
opportunity for Tucker's stockholders to become equity holders in a real estate
investment trust with greater potential for long-term appreciation. The Tucker
Board of Directors also believes that the Merger would combine complementary
assets of Tucker and Bradley. The Tucker Board believes that there are no other
feasible alternatives available to Tucker that are likely to significantly
improve the profitability of Tucker's existing operations and that the Merger is
the best offer reasonably available for Tucker's stockholders.
PaineWebber Incorporated, Tucker's financial advisor, has advised the Tucker
Board of Directors that, in its opinion, the exchange ratio is fair to the
holders of Tucker common stock from a financial point of view.
The accompanying Joint Proxy Statement/Prospectus provides detailed
information concerning the proposed Merger, the reasons for your Board of
Directors' recommendation of the Merger and the Merger Agreement and certain
additional information, including, without limitation, the information set forth
under the
<PAGE>
heading "Risk Factors," which describes, among other items, potential adverse
effects to stockholders as a result of the Merger. We urge you to carefully
consider all of the information in the Joint Proxy Statement/Prospectus. It is
important that your shares of Tucker common stock be represented at the Special
Meeting, regardless of the number of shares you hold. Therefore, please sign,
date and return your proxy card as soon as possible, whether or not you plan to
attend the Special Meeting. This will not prevent you from voting your shares in
person if you subsequently choose to attend the Special Meeting.
Sincerely,
KENNETH L. TUCKER
Chairman of the Board and President
<PAGE>
TUCKER PROPERTIES CORPORATION
40 SKOKIE BOULEVARD, SUITE 600
NORTHBROOK, ILLINOIS 60062
__________________
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON FEBRUARY __, 1996
__________________
To the Stockholders of Tucker Properties Corporation:
A Special Meeting of Stockholders of Tucker Properties Corporation, a
Maryland corporation ("Tucker"), will be held at 9:00 a.m., Central time, on
February __, 1996, at _______________________, Chicago, Illinois ______ (the
"Special Meeting") for the following purposes:
1. To consider and vote upon a proposal to approve the merger (the
"Merger") of Tucker with and into Bradley Real Estate, Inc. ("Bradley") and
the Agreement and Plan of Merger, dated as of October 30, 1995 (the "Merger
Agreement"), by and between Bradley and Tucker, pursuant to which, among
other things, each outstanding share of Tucker common stock will be
converted into the right to receive a percentage of a share of Bradley
common stock to be determined as follows. If the average per share closing
price of Bradley common stock for the 20 trading days prior to the fifth day
preceding the closing of the Merger is $16.00 or more, each share of Tucker
common stock will be exchanged for .665 of a share of Bradley common stock.
If such average closing price is between $15.50 and $16.00, the exchange
ratio will be determined by dividing $10.64 by the average closing price. If
such average closing price is $15.50 or less, the exchange ratio will be
.686 of a share of Bradley common stock. A copy of the Merger Agreement is
attached as Annex A to the Joint Proxy Statement/Prospectus accompanying
this Notice.
2. To transact such other business as may properly come before the
meeting or any adjournments or postponements thereof.
The Board of Directors of Tucker has fixed the close of business on January
__, 1996 as the record date for the determination of the holders of shares of
Tucker common stock entitled to notice of, and to vote at, the Special Meeting.
The Merger and other related matters are more fully described in the
accompanying Joint Proxy Statement/Prospectus, and the Annexes thereto, which
form a part of this Notice.
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE SPECIAL MEETING. TO
ENSURE YOUR REPRESENTATION AT THE SPECIAL MEETING, HOWEVER, YOU ARE URGED TO
COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE. A
POSTAGE-PREPAID ENVELOPE IS ENCLOSED FOR THAT PURPOSE. ANY STOCKHOLDER ATTENDING
THE SPECIAL MEETING MAY VOTE IN PERSON EVEN IF THAT STOCKHOLDER HAS RETURNED A
PROXY.
By Order of the Board of Directors
RICHARD H. TUCKER
Secretary
PLEASE DO NOT SEND IN ANY CERTIFICATES FOR YOUR SHARES AT THIS TIME.
January __, 1996
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
SUBJECT TO COMPLETION
DECEMBER 7, 1995
BRADLEY REAL ESTATE, INC.
AND
TUCKER PROPERTIES CORPORATION
JOINT PROXY STATEMENT
_____________
BRADLEY REAL ESTATE, INC.
PROSPECTUS
This Joint Proxy Statement and Prospectus ("Joint Proxy
Statement/Prospectus") is being furnished to the holders of common stock, par
value $.01 per share ("Bradley Common Stock"), of Bradley Real Estate, Inc., a
Maryland corporation ("Bradley"), in connection with the solicitation of proxies
by the Board of Directors of Bradley for use at a Special Meeting of
Stockholders of Bradley to be held at ______________________________________,
Boston, Massachusetts _____, on February __, 1996, at 10:00 a.m., Eastern time,
and at any and all adjournments or postponements thereof (the "Bradley Special
Meeting"). This Joint Proxy Statement/Prospectus also constitutes the Prospectus
of Bradley with respect to the issuance of up to 7,428,202 shares of Bradley
Common Stock to be issued to stockholders of Tucker Properties Corporation, a
Maryland corporation ("Tucker"), in connection with the Merger (as hereinafter
defined). Bradley Common Stock is traded on the New York Stock Exchange (the
"NYSE") under the symbol "BTR." On January __, 1996, the closing price for
Bradley Common Stock as reported by the NYSE Composite Tape was $______ per
share.
This Joint Proxy Statement/Prospectus is also being furnished to the
holders of common stock, par value $.001 per share ("Tucker Common Stock"), of
Tucker in connection with the solicitation of proxies by the Board of Directors
of Tucker for use at a Special Meeting of Stockholders of Tucker to be held at
_______________________________, Chicago, Illinois ______, on February __, 1996,
at 9:00 a.m., Central time, and at any and all adjournments or postponements
thereof (the "Tucker Special Meeting").
This Joint Proxy Statement/Prospectus relates to the proposed merger (the
"Merger") of Tucker with and into Bradley, pursuant to the Agreement and Plan of
Merger, dated as of October 30, 1995 (the "Merger Agreement"), by and between
Bradley and Tucker. Bradley will be the surviving corporation in the Merger
(sometimes hereinafter referred to as the "Surviving Company"), and upon
completion of the Merger, the separate corporate existence of Tucker will cease.
Consummation of the Merger is subject to various conditions (which must be
satisfied or waived), including approval of the Merger and the Merger Agreement
by the holders of two-thirds of the outstanding shares of Tucker Common Stock at
the Tucker Special Meeting and by the holders of a majority of the outstanding
shares of Bradley Common Stock at the Bradley Special Meeting. The stockholders
of each of Bradley and Tucker also will consider and vote upon such other
business as may properly come before the Bradley Special Meeting or the Tucker
Special Meeting, as the case may be, or any adjournment(s) or postponement(s)
thereof.
FOR CERTAIN FACTORS WHICH SHOULD BE CONSIDERED IN EVALUATING THE MERGER,
SEE "RISK FACTORS."
All information contained in this Joint Proxy Statement/Prospectus with
respect to Bradley has been provided by Bradley. All information contained in
this Joint Proxy Statement/Prospectus with respect to Tucker has been provided
by Tucker.
This Joint Proxy Statement/Prospectus and the accompanying forms of proxy
are first being mailed to stockholders of Bradley and Tucker on or about January
__, 1996. A stockholder who has given a proxy may revoke it at any time prior to
its exercise.
_________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS JOINT PROXY STATEMENT/PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Joint Proxy Statement/Prospectus is January __, 1996.
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN OR INCORPORATED BY REFERENCE IN THIS JOINT PROXY
STATEMENT/PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION
NOT CONTAINED HEREIN MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS
JOINT PROXY STATEMENT/PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR THE
SOLICITATION OF AN OFFER TO PURCHASE, ANY OF THE SECURITIES OFFERED BY THIS
JOINT PROXY STATEMENT/PROSPECTUS, OR THE SOLICITATION OF A PROXY, IN ANY
JURISDICTION TO OR FROM ANY PERSON TO OR FROM WHOM IT IS UNLAWFUL TO MAKE SUCH
OFFER OR SOLICITATION OF AN OFFER, OR PROXY SOLICITATION IN SUCH JURISDICTION.
NEITHER THE DELIVERY OF THIS JOINT PROXY STATEMENT/PROSPECTUS NOR THE ISSUANCE
OR SALE OF ANY SECURITIES HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE INFORMATION SET FORTH OR
INCORPORATED HEREIN SINCE THE DATE HEREOF.
AVAILABLE INFORMATION
Bradley and Tucker are each subject to the informational reporting
requirements of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and in accordance therewith file reports, proxy and information
statements and other information with the Securities and Exchange Commission
(the "Commission"). Such reports, proxy and information statements and other
information filed by Bradley and Tucker can be inspected and copied at the
public reference facilities maintained by the Commission at Room 1024, Judiciary
Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 and may be available at
the following Regional Offices of the Commission: Chicago Regional Office,
Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661; and New York Regional Office, 7 World Trade Center, 13th Floor,
New York, New York 10048. Copies of such materials can be obtained at prescribed
rates from the Public Reference Section of the Commission at Judiciary Plaza,
450 Fifth Street, N.W., Washington, D.C. 20549. In addition, reports, proxy and
information statements and other information concerning Bradley and Tucker can
be inspected at the offices of the NYSE, 20 Broad Street, New York, New York
10005, on which the Bradley Common Stock and Tucker Common Stock are listed.
This Joint Proxy Statement/Prospectus does not contain all the information
set forth in the Registration Statement on Form S-4 and exhibits relating
thereto, including any amendments (the "Registration Statement"), of which this
Joint Proxy Statement/Prospectus is a part, and which Bradley has filed with the
Commission under the Securities Act of 1933, as amended (the "Securities Act").
Reference is made to such Registration Statement for further information with
respect to Bradley and the Bradley Common Stock offered hereby. Statements
contained herein or incorporated herein by reference concerning the provisions
of documents are summaries of such documents, and each statement is qualified in
its entirety by reference to the copy of the applicable document if filed with
the Commission or attached as an annex hereto.
INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents previously filed with the Commission are hereby
incorporated by reference into this Joint Proxy Statement/Prospectus:
Bradley
1. The information contained in Bradley's Registration Statement on Form
S-3 (No. 33-87084) effective January 3, 1995 including all
Prospectuses and Prospectus Supplements filed pursuant to Rule 424(b),
the most recent such Prospectus dated June 9, 1995 and the most recent
such Prospectus Supplement dated June 29, 1995, including the
description of Bradley Common Stock contained in such Prospectus under
the caption "Description of Capital Stock," and including all exhibits
to said Registration Statement;
2. Annual Report on Form 10-K for the fiscal year ended December 31,
1994;
3. Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31,
1995, June 30, 1995 and September 30, 1995;
(ii)
<PAGE>
4. Current Reports on Form 8-K dated June 29, 1995 reporting the
execution of the Underwriting Agreement relating to the public
offering of 2,500,000 shares of Bradley Common Stock and November 3,
1995 reporting the execution of the Merger Agreement;
5. The description of the Bradley Common Stock contained or incorporated
by reference in Bradley's Registration Statement on Form 8-A, dated
August 5, 1994, including any amendments thereto; and
6. Proxy Statement dated March 29, 1995 in connection with Bradley's 1995
Annual Meeting of Stockholders.
Tucker
1. The information contained under the captions "The Properties," "Growth
Strategy and Philosophy" and "Federal Income Tax Considerations" in
Tucker's Registration Statement on Form S-11 (No. 33-64942) dated
October 4, 1993, including all exhibits thereto;
2. Annual Report on Form 10-K for the fiscal year ended December 31,
1994;
3. Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31,
1995, June 30, 1995 and September 30, 1995;
4. Current Report on Form 8-K dated November 3, 1995 reporting the
execution of the Merger Agreement;
5. The description of the Tucker Common Stock contained or incorporated
by reference in Tucker's Registration Statement on Form 8-A, dated
October 19, 1993, including any amendments thereto; and
6. Proxy Statement dated May 1, 1995 in connection with Tucker's 1995
Annual Meeting of Stockholders.
In addition, all reports and other documents filed by each of Bradley and
Tucker pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act
subsequent to the date hereof and prior to the Bradley Special Meeting and the
Tucker Special Meeting shall be deemed to be incorporated by reference herein
and to be a part hereof from the date of filing of such reports and documents.
Any statement contained in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for purposes of
this Joint Proxy Statement/Prospectus to the extent that a statement contained
herein, or in any other subsequently filed document that also is incorporated or
deemed to be incorporated by reference herein, modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Joint Proxy
Statement/Prospectus.
THIS JOINT PROXY STATEMENT/PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE
WHICH ARE NOT PRESENTED HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS (NOT
INCLUDING EXHIBITS TO SUCH DOCUMENTS UNLESS SUCH EXHIBITS ARE SPECIFICALLY
INCORPORATED BY REFERENCE INTO SUCH DOCUMENTS) ARE AVAILABLE, WITHOUT CHARGE,
UPON WRITTEN OR ORAL REQUEST OF ANY PERSON, INCLUDING ANY BENEFICIAL OWNER, TO
WHOM THIS JOINT PROXY STATEMENT/PROSPECTUS IS DELIVERED TO, IN THE CASE OF
DOCUMENTS RELATING TO BRADLEY, 699 BOYLSTON STREET, BOSTON, MASSACHUSETTS 02116,
ATTENTION: DONNA MACAULEY (TELEPHONE NO. (617) 867-4200), OR, IN THE CASE OF
DOCUMENTS RELATING TO TUCKER, 40 SKOKIE BOULEVARD, SUITE 600, NORTHBROOK,
ILLINOIS 60062, ATTENTION: MARY TIERNEY GIBSON, SHAREHOLDER RELATIONS
(TELEPHONE NO. (708) 272-9800, EXT. 46). IN ORDER TO ENSURE TIMELY DELIVERY OF
THE DOCUMENTS, ANY REQUEST SHOULD BE MADE BY FEBRUARY __, 1996.
(iii)
<PAGE>
TABLE OF CONTENTS
<TABLE>
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Page
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SUMMARY........................................................................................... 1
The Companies................................................................................ 1
The Merger................................................................................... 3
Risk Factors................................................................................. 7
The Merger Agreement......................................................................... 8
The Meetings of Stockholders................................................................. 10
Comparison of Stockholder Rights............................................................. 11
Summary Historical and Unaudited Pro Forma Combined Financial Data........................... 12
Comparative Per Share Data................................................................... 17
Comparative Market Data...................................................................... 18
Distribution and Dividend Policy............................................................. 19
RISK FACTORS...................................................................................... 20
Substantial Debt Obligations and Terms of Debt............................................... 20
Restrictions on Ability of Surviving Company to Dispose of Properties Collateralizing
the Tucker REMIC Note or to Prepay the Tucker REMIC Note................................. 20
Reductions in Dividends Per Share for Tucker Stockholders following Consummation
of the Merger............................................................................ 21
Stock Price Fluctuations..................................................................... 21
Shares Available for Future Sale Could Adversely Affect Price of Bradley Common Stock........ 21
Benefits to Certain Tucker Directors and Officers............................................ 21
Differences between Rights of Tucker Stockholders and Bradley Stockholders................... 21
Substantial Expenses and Payments if Merger Fails to Occur................................... 22
Real Estate Investment Considerations........................................................ 22
Possible Environmental Liabilities........................................................... 23
Adverse Consequences of Failure to Qualify as a REIT......................................... 24
Competition.................................................................................. 25
Ownership Limits............................................................................. 25
Dissenters' Rights........................................................................... 26
THE COMPANIES..................................................................................... 27
Bradley...................................................................................... 27
Tucker....................................................................................... 27
Surviving Company............................................................................ 28
THE MERGER........................................................................................ 32
Terms of the Merger.......................................................................... 32
Background of the Merger..................................................................... 32
Reasons for the Merger; Recommendation of the Board of Directors of Tucker................... 38
Opinion of Tucker's Financial Advisor........................................................ 41
Reasons for the Merger; Recommendation of the Board of Directors of Bradley.................. 45
Opinion of Bradley's Financial Advisor....................................................... 47
Interests of Certain Officers and Directors of Tucker........................................ 51
Certain Federal Income Tax Consequences...................................................... 53
Accounting Treatment......................................................................... 57
Regulatory Approval.......................................................................... 58
Certain Resale Restrictions.................................................................. 58
New York Stock Exchange Listing.............................................................. 58
Dissenters' Rights........................................................................... 58
THE MERGER AGREEMENT.............................................................................. 59
General...................................................................................... 59
</TABLE>
(iv)
<PAGE>
<TABLE>
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Effective Time of the Merger................................................................. 59
Exchange of Tucker Stock Certificates........................................................ 59
Conditions to the Merger..................................................................... 60
Representations and Warranties............................................................... 61
Certain Covenants............................................................................ 62
Termination.................................................................................. 64
Termination Amount and Expenses.............................................................. 64
Reduction of Termination Amount or Expenses.................................................. 65
No Solicitation of Transactions.............................................................. 66
Indemnification.............................................................................. 66
Amendments................................................................................... 67
Amended TOP Partnership Agreement............................................................ 67
Transfer of Interests in TMC................................................................. 70
UNAUDITED PRO FORMA
COMBINED FINANCIAL STATEMENTS................................................................ 71
MANAGEMENT OF THE SURVIVING COMPANY............................................................... 82
THE MEETINGS OF STOCKHOLDERS...................................................................... 84
Bradley Special Meeting...................................................................... 84
Tucker Special Meeting....................................................................... 85
COMPARISON OF STOCKHOLDER RIGHTS.................................................................. 86
Amendment of Charter and Bylaws.............................................................. 86
Required Vote for Authorization of Certain Actions........................................... 86
Board of Directors........................................................................... 86
Special Meetings............................................................................. 87
Business Combinations........................................................................ 87
Restrictions on the Ownership, Transfer or Issuance of Shares................................ 87
Advance Notice for Stockholder Proposals..................................................... 89
Control Share Acquisitions................................................................... 89
Dissolution.................................................................................. 90
OTHER MATTERS..................................................................................... 91
LEGAL MATTERS..................................................................................... 91
EXPERTS........................................................................................... 91
STOCKHOLDER PROPOSALS............................................................................. 91
</TABLE>
ANNEXES
A. Agreement and Plan of Merger
B. Opinion of Tucker's Financial Advisor: PaineWebber Incorporated
C. Opinion of Bradley's Financial Advisor: Alex. Brown & Sons
Incorporated
(v)
<PAGE>
[Map showing location of Bradley and Tucker Properties]
(vi)
<PAGE>
SUMMARY
The following is a brief summary of certain information contained
elsewhere in this Joint Proxy Statement/Prospectus and the Annexes hereto
relating to the proposed merger (the "Merger") of Tucker Properties
Corporation ("Tucker") with and into Bradley Real Estate, Inc. ("Bradley"),
pursuant to which Bradley will be the surviving corporation (sometimes
hereinafter referred to as the "Surviving Company") and the separate corporate
existence of Tucker will cease. This summary does not purport to contain all
material information relating to the Merger and the Agreement and Plan of
Merger, dated as of October 30, 1995 (the "Merger Agreement"), by and between
Bradley and Tucker, and is qualified in its entirety by, the more detailed
information and financial statements contained or incorporated by reference in
this Joint Proxy Statement/Prospectus. STOCKHOLDERS OF BRADLEY AND TUCKER
SHOULD READ CAREFULLY THIS JOINT PROXY STATEMENT/PROSPECTUS AND THE ANNEXES
ATTACHED HERETO IN THEIR ENTIRETY. Unless the context indicates otherwise,
all references to Bradley and Tucker include their respective subsidiaries and
affiliated partnerships.
THE COMPANIES
BRADLEY
Bradley is one of the nation's oldest continuously qualified real estate
investment trusts ("REIT") under the Internal Revenue Code of 1986, as amended
(the "Code"). Bradley focuses on the ownership and operation of community
shopping centers, primarily in the Midwestern and the Northeastern regions of
the United States. Bradley's objective is to enhance the operating performance
and value of its portfolio through renovation, expansion and leasing
strategies designed to meet the needs of an evolving retail marketplace.
Bradley also seeks to create value through the acquisition of properties which
can benefit from Bradley's expertise in shopping center management, renovation
and expansion. Bradley's properties currently encompass approximately 3.0
million square feet of rentable retail space.
Originally organized in 1961 as a Massachusetts business trust under the
name Bradley Real Estate Trust, Bradley was reorganized as a Maryland
corporation in October 1994. Bradley's principal executive office is located
at 699 Boylston Street, Boston, Massachusetts 02116 and its telephone number
is (617) 867-4200.
TUCKER
Tucker is a leader in the Midwest in the development, acquisition and
long-term ownership of community shopping centers. Headquartered in
Northbrook, Illinois, Tucker owns and manages more than 4.3 million square
feet of income-producing properties. The properties are located primarily in
Chicago and other areas of the Midwest, with tenants primarily selling value-
oriented merchandise.
Tucker is a Maryland corporation, formed on May 28, 1993, which elected
to qualify as a REIT under the Code following the public offering of its
common stock, par value $.001 per share ("Tucker Common Stock"), in October
1993. Tucker is a fully integrated real estate management and development
company and was established to continue the business of The Tucker Companies,
Inc. ("TTC"), its affiliates and related real estate entities (collectively,
the "Predecessor Business") as an owner, manager and developer of shopping
centers. TTC was founded in 1976 by Kenneth L. Tucker, Tucker's Chairman of
the Board, President and a Director.
All of Tucker's real estate properties are held by, and all of its
operations are conducted through, the Tucker Operating Limited Partnership
("TOP") and its subsidiaries. TOP was formed for the purpose of acquiring,
operating and expanding the business of Tucker and certain of its affiliates.
Tucker is the sole general partner of TOP and owns 95.9% of the outstanding
partnership units of TOP ("TOP Units"). The limited partners of TOP, including
Kenneth L. Tucker, Richard H. Tucker, Tucker's Executive Vice President, Chief
Operating Officer and a Director, and Harold Eisenberg, Tucker's Executive
Vice President--Leasing and Development and a Director (collectively, the
"Management Directors"), were equity holders of the entities which previously
owned the properties transferred to TOP in connection with Tucker's initial
public offering
<PAGE>
in October 1993. The TOP Units are exchangeable, subject to certain
limitations imposed to protect Tucker's status as a REIT, into shares of
Tucker Common Stock on the basis of one TOP Unit for one share of Tucker
Common Stock.
Tucker Financing Partnership ("TFP") was created to facilitate the
refinancing of indebtedness encumbering certain of the Tucker properties
through a loan to TFP from a trust qualifying as a real estate mortgage
investment conduit (the "Tucker REMIC") for federal income tax purposes. The
six Tucker properties owned by TFP collateralize a $100,000,000 mortgage note
(the "Tucker REMIC Note") held by the Tucker REMIC and issued pursuant to that
certain indenture (the "Tucker REMIC Indenture") dated as of June 1, 1994 by
and among TFP, Bankers Trust Company of California, N.A. (the "Indenture
Trustee") and Bankers Trust Company. TOP is the 99% general partner of TFP,
and Tucker Financing Corp. ("TFC"), a wholly-owned subsidiary of Tucker, is
the 1% general partner of TFP.
Tucker's principal executive office is located at 40 Skokie Boulevard,
Suite 600, Northbrook, Illinois 60062 and its telephone number is (708) 272-
9800.
SURVIVING COMPANY
Following the consummation of the Merger, the Surviving Company will be
one of the leading owners and operators of community shopping centers in the
Midwestern region of the United States; it will own 31 community shopping
centers encompassing approximately 7.3 million square feet of rentable retail
space in eleven states. As the map on page (vi) indicates, the Merger allows
the Surviving Company to enter four new states (Tennessee, Kentucky, Indiana
and Wisconsin) and to significantly expand its presence throughout the
Midwest.
The current executive officers and directors of Bradley will manage the
business and affairs of the Surviving Company following the consummation of
the Merger. For information concerning these persons, see "Management of the
Surviving Company." Following the Merger, the Surviving Company will employ
most of Tucker's property management personnel. Given the strength of Tucker's
property-level operational personnel and systems, Bradley's management
believes the Merger will broaden its existing property management capabilities
and allow the Surviving Company to internalize its property management and
leasing functions.
Bradley is currently in discussions with the lead lender under its
existing $65 million secured revolving credit facility regarding replacing
this facility with a $150 million unsecured revolving credit facility. Bradley
anticipates that the new credit facility will be available for the
acquisition, development, renovation and expansion of new and existing
properties (including, but not limited to, capital improvements, tenant
improvements, and leasing commissions), and other working capital purposes. It
is anticipated that the interest rates available under the new credit facility
will be more favorable than those currently available under Bradley's existing
secured credit facility and may become even more favorable in the event the
Surviving Company (x) meets certain loan to value tests or (y) receives an
investment grade unsecured debt rating. Bradley anticipates that the new
credit facility will contain financial and other covenants which are
consistent with similar unsecured lines of credit for comparable publicly-
traded REITs. Bradley believes that the increased size, lower interest rate
and unsecured nature of the new credit facility will increase the Surviving
Company's financial flexibility and prospects for obtaining an investment
grade debt rating. It is currently contemplated that the new credit facility
will become effective simultaneously with the closing of the Merger. While
discussions regarding a new credit facility are ongoing, there can be no
assurance that such a credit facility will be obtained, or if obtained, when
it will become effective or become available. If this new credit facility
cannot be obtained, consent to the Merger would be required from the existing
revolving credit lenders to Bradley and Tucker and an extension of the Tucker
credit agreement would be required. See "The Merger Agreement--Conditions to
the Merger."
2
<PAGE>
THE MERGER
TERMS OF THE MERGER
The Board of Directors of each of Bradley and Tucker have approved the
Merger and the Merger Agreement, a copy of which is attached hereto as Annex
A, pursuant to which, upon fulfillment (or waiver) of the conditions set forth
therein, at the time the Merger becomes effective (the "Effective Time"), (i)
Tucker will be merged with and into Bradley, with Bradley being the Surviving
Company in the Merger, and (ii) each issued and outstanding share of Tucker
Common Stock will be converted into the right to receive a percentage of a
share of common stock, par value $.01 per share, of Bradley ("Bradley Common
Stock"), to be determined as follows. If the average per share closing price
(the "Closing Price") of Bradley Common Stock as reported on the New York
Stock Exchange (the "NYSE") over the 20 trading days immediately preceding the
fifth day prior to the date of the closing of the Merger (the "Closing Date")
is $16.00 or more, each share of Tucker Common Stock will be exchanged for
.665 of a share of Bradley Common Stock. If the Closing Price is between
$15.50 and $16.00, the exchange ratio will be determined by dividing $10.64 by
the Closing Price. If the Closing Price is $15.50 or less, the exchange ratio
will be .686 of a share of Bradley Common Stock. (The applicable percentage of
a share of Bradley Common Stock to be issued to Tucker stockholders in
connection with the Merger upon such conversion will sometimes hereinafter be
referred to as the "Exchange Ratio.") The Closing Price for Bradley Common
Stock for the 20 trading days ended January __, 1996 was $_______. The
Exchange Ratio was the result of arms-length negotiations between Bradley and
Tucker.
No fractional shares of Bradley Common Stock will be issued in connection
with the Merger. In lieu thereof, a holder of Tucker Common Stock otherwise
entitled to a fractional share of Bradley Common Stock will be paid an amount
in cash (without interest), rounded to the nearest cent, determined by
multiplying the Closing Price by the fraction of a share of Bradley Common
Stock to which such holder would otherwise be entitled.
Based upon the number of shares of Tucker Common Stock and Bradley Common
Stock outstanding at January __, 1996, the former Tucker stockholders will
hold, immediately after the Merger, (i) assuming an Exchange Ratio of .665,
approximately 7,200,808 shares of Bradley Common Stock, representing
approximately 39% of the aggregate number of outstanding shares of Bradley
Common Stock; and (ii) assuming an Exchange Ratio of .686, approximately
7,428,202 shares of Bradley Common Stock, representing approximately 40% of
the aggregate number of outstanding shares of Bradley Common Stock.
REASONS FOR THE MERGER; RECOMMENDATIONS OF THE BOARDS OF DIRECTORS
Tucker
The Board of Directors of Tucker believes that the Merger is fair to and
in the best interests of Tucker and its stockholders. THE TUCKER BOARD OF
DIRECTORS HAS UNANIMOUSLY APPROVED THE MERGER AND THE MERGER AGREEMENT AND
UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS OF TUCKER VOTE FOR THE MERGER AND THE
MERGER AGREEMENT. The primary factors that Tucker's Board of Directors
considered in reaching the foregoing conclusions were: (i) Tucker's highly-
leveraged capital structure, its decline in funds from operations ("FFO") and
its resulting difficulty in accessing capital markets; (ii) the Tucker Board
of Directors' belief that there are no feasible alternatives to a merger
available to Tucker that are likely in the near term to significantly improve
the profitability of Tucker's existing operations; (iii) the Tucker Board of
Directors' belief that the Merger is the best offer reasonably available for
Tucker's stockholders; (iv) the anticipated cost savings and operating
efficiencies available to the Surviving Company from the Merger; (v) Tucker's
and Bradley's stock price multiples relative to each other and to the
multiples of comparable REITs; (vi) the terms of the Merger Agreement,
including the Exchange Ratio and the equity interest in the Surviving Company
to be received by Tucker's stockholders; (vii) the fact that the Merger will
provide an opportunity for Tucker's stockholders to share in any future
appreciation of the Surviving Company; (viii) the fact that the Merger is
structured to enable Tucker's stockholders to convert their shares of Tucker
Common Stock into shares of Bradley Common Stock on a tax-free basis; (ix) the
similarities between Tucker and Bradley, with both companies being of similar
size, focused primarily in the retail sector and owning properties
concentrated in the Midwest; (x) the complementary
3
<PAGE>
strengths of Tucker and Bradley, including Tucker's property management and
leasing capabilities and Bradley's property acquisition and capital markets
expertise; (xi) the fact that the Surviving Company will have increased
capacity which will allow it to attract national tenants and provide it with
increased negotiating leverage; and (xii) the Total Market Capitalization (as
measured by the aggregate value of the outstanding common stock plus
outstanding indebtedness) of the Surviving Company will be larger than
Tucker's Total Market Capitalization, which will provide Tucker's stockholders
with enhanced liquidity. In making its recommendation, the Tucker Board of
Directors also considered the opinion, analyses and presentations of
PaineWebber Incorporated ("PaineWebber"), Tucker's financial advisor,
including its oral opinion of October 29, 1995, which will be confirmed by a
written opinion on the date that this Joint Proxy Statement/Prospectus is
mailed to Tucker stockholders, to the effect that, as of the date of such
opinion, and based upon and subject to certain matters stated therein, the
Exchange Ratio was fair, from a financial point of view, to Tucker's
stockholders. See "The Merger--Reasons for the Merger; Recommendation of the
Board of Directors of Tucker" and "--Opinion of Tucker's Financial Advisor."
Bradley
The Board of Directors of Bradley believes that the Merger is fair to and
in the best interests of Bradley and its stockholders. THE BRADLEY BOARD OF
DIRECTORS HAS UNANIMOUSLY APPROVED THE MERGER AND THE MERGER AGREEMENT AND
UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS OF BRADLEY VOTE FOR THE MERGER AND
THE MERGER AGREEMENT. The primary factors that Bradley's Board of Directors
considered in reaching the foregoing conclusions were its belief that: (i) the
Merger will result in the Surviving Company becoming one of the leading owners
and operators of community shopping centers in the Midwest; (ii) the Merger
will provide the Surviving Company with a broader and more diverse tenant base
and thus reduce the potential impact on Bradley of the loss of any tenant and
also enhance its position with regional and national tenants; (iii) the Merger
will be accretive (i.e., will result in an incremental increase) to the
projected per share FFO of the Surviving Company in 1996 and 1997; (iv) the
Merger will provide the Surviving Company with greater access to the capital
markets including increasing the likelihood of access by the Surviving Company
to unsecured investment grade debt; (v) the Merger will improve the liquidity
of the Surviving Company's common stock; (vi) the Merger will allow the
Surviving Company to improve the terms of its revolving credit agreement,
including increasing the amount available under such line and obtaining such
financing on an unsecured basis; (vii) the Merger will lead to ongoing
operating synergies and additional cost savings, initially estimated to be
approximately $1.4 million per annum prior to the offset of costs associated
with the Merger (which costs are estimated to be approximately $8.5 million);
and (viii) the Merger will broaden Bradley's property management capabilities
and allow it to internalize its property management and leasing functions. In
making its recommendation, the Board of Directors of Bradley also considered
the opinion, analyses and presentations of Alex. Brown & Sons Incorporated
("Alex. Brown"), Bradley's financial advisor, including its oral opinion of
October 20, 1995, confirmed by a written opinion, dated October 30, 1995, to
the effect that, as of the date of such opinion and based upon and subject to
certain matters stated therein, the Exchange Ratio was fair, from a financial
point of view, to Bradley's stockholders. See "The Merger--Reasons for the
Merger; Recommendation of the Board of Directors of Bradley" and "--Opinion of
Bradley's Financial Advisor."
For a discussion of the circumstances surrounding the Merger and the
reasons for the recommendations of the Boards of Directors of Tucker and
Bradley, see "The Merger--Background of the Merger," "--Reasons for the
Merger; Recommendation of the Board of Directors of Tucker" and "--Reasons for
the Merger; Recommendation of the Board of Directors of Bradley."
OPINIONS OF FINANCIAL ADVISORS
Tucker
On October 29, 1995, PaineWebber delivered its oral opinion to Tucker's
Board of Directors to the effect that, as of such date, based on PaineWebber's
review and subject to certain limitations, the Exchange Ratio was fair, from a
financial point of view, to the holders of Tucker Common Stock. PaineWebber
will render such opinion in writing on the date that this Joint Proxy
Statement/Prospectus is mailed to Tucker stockholders. In rendering such
opinion, PaineWebber has, among other things, (i) reviewed certain publicly
available financial
4
<PAGE>
information concerning Tucker and Bradley; (ii) reviewed certain information,
including financial forecasts, related to the business, earnings, cash flow,
assets and prospects of Tucker and Bradley, furnished to PaineWebber by Tucker
and Bradley, respectively; (iii) conducted discussions with members of the
senior management of Tucker and Bradley concerning their respective businesses
and prospects; (iv) reviewed the historical market prices and trading
activities for Tucker Common Stock and Bradley Common Stock and compared such
prices and trading histories with those of certain other publicly-traded
companies which PaineWebber deemed to be relevant; (v) compared the financial
position and results of operations of Tucker and Bradley with those of certain
other publicly-traded companies which PaineWebber deemed to be relevant; (vi)
reviewed the Merger Agreement; (vii) reviewed the Amended and Restated TOP
Agreement of Limited Partnership (the "Amended TOP Partnership Agreement");
and (viii) reviewed such other financial studies and analyses and performed
such investigations and took into account such other matters as PaineWebber
deemed appropriate, including its assessment of general economic, market and
monetary conditions. A copy of the full text of the written opinion of
PaineWebber, which sets forth the assumptions made, procedures followed,
matters considered and limits of its review, will be attached as Annex B to
this Joint Proxy Statement/Prospectus, and should be read in its entirety.
See "The Merger--Opinion of Tucker's Financial Advisor."
Bradley
On October 30, 1995, Alex, Brown delivered its written opinion to
Bradley's Board of Directors to the effect that, as of such date, based upon
the facts and circumstances ad they existed at that time and subject to
certain limitations, the Exchange Ratio was fair, from a financial point of
view, to Bradley's stockholders. In rendering such opinion, Alex. Brown (i)
reviewed the Merger Agreement and certain related documents; (ii) reviewed
certain publicly available financial information concerning Bradley and Tucker
and certain internal financial analyses and other information furnished to it
by Bradley and Tucker; (iii) held discussions with members of the senior
managements of Bradley and Tucker regarding the business and prospects of
Bradley and Tucker Common Stock; (v) compared certain financial and stock
market information for Tucker and Bradley with similar information for certain
other companies whose securities are publicly-traded; (vi) reviewed the
financial terms of certain recent business combinations; and (vii) performed
such other studies and analyses and considered such other factors as it deemed
comparable, in whole or in part. A copy of the full text of the written
opinion of Alex. Brown, which sets forth the assumptions made, procedures
followed, matters considered and limits of its review, is attached as "Annex C
to this Joint Proxy Statement/Prospectus, and should be read in its entirety.
See "The Merger--Opinion of Bradley's Financial Advisor."
INTERESTS OF CERTAIN OFFICERS AND DIRECTORS OF TUCKER
In considering the recommendation of the Boards of Directors of Tucker
and Bradley to approve the Merger and the Merger Agreement, stockholders
should be aware that certain members of the management and the Board of
Directors of Tucker have certain interests in, and will receive benefits from,
the Merger that are separate from the interests of, and benefits to, the
stockholders of Tucker generally. In connection with the execution of the
Merger Agreement, Tucker adopted and entered into the following plans and
agreements: (i) the Tucker Severance Pay Plan (the "Severance Plan"), pursuant
to which all employees of Tucker and its affiliates (with the exception of
those described below) whose employment terminates under certain specified
conditions prior to December 31, 1996 will be entitled to receive a severance
payment equal to six weeks' base salary plus an additional two weeks' base
salary for each full year of regular full-time employment with Tucker, its
predecessors and their respective affiliates (including TTC), up to a maximum
payment of twice the employee's annual compensation for the calendar year
immediately prior to the employee's termination of employment; (ii) a
severance agreement with Kenneth Tucker, Tucker's Chairman of the Board,
President and a Director, pursuant to which Mr. Tucker will be entitled to
receive (a) a severance payment of $225,000 if his employment is terminated
under certain specified conditions prior to December 31, 1996 or if he is
still employed by Tucker as of the Effective Time and (b) twelve months of
continued health care coverage following termination of employment if his
employment is terminated under certain specified conditions prior to December
31, 1996; (iii) individual severance agreements with Richard Tucker, Tucker's
Executive Vice President, Chief Operating Officer and a Director, Harold
Eisenberg, Tucker's Executive Vice President--Leasing and
5
<PAGE>
Development and a Director, and Lawrence Tucker, Tucker's Vice President,
pursuant to which the employee will be entitled to receive a severance payment
of $123,000, $122,000 and $58,000, respectively, as well as twelve months of
continued health care coverage, if his employment is terminated under certain
specified conditions prior to December 31, 1996; (iv) an agreement with Norris
Eber, Tucker's Senior Vice President--Asset Management and Acquisitions,
pursuant to which Mr. Eber will receive (a) $139,000 if he is still employed
by Tucker as of the Effective Time, and (b) a severance payment of $61,000 and
twelve months of continued health care coverage if his employment is
terminated under certain specified conditions prior to December 31, 1996; and
(v) a severance agreement with William Karnes, Tucker's Chief Financial
Officer, pursuant to which Mr. Karnes will receive twelve months of continued
health care coverage if his employment is terminated under certain specified
conditions prior to December 31, 1996. Bradley has agreed to assume and be
bound by these agreements after the Effective Time. Tucker previously entered
into an employment agreement with Mr. Karnes pursuant to which he will receive
a severance payment equal to twelve months' base salary (currently $210,000)
if his employment is terminated under certain conditions. Bradley also has
entered into a three-year consulting agreement with Kenneth Tucker, effective
as of the Effective Time, pursuant to which Mr. Tucker will receive an annual
consulting fee of $135,000. In addition, Bradley has agreed to continue to
provide the directors, officers, employees, advisors and agents of Tucker and
each of its subsidiaries with all rights to indemnification or exculpation
existing under their respective charters or bylaws in effect as of the date of
the Merger Agreement with respect to matters occurring at or prior to the
Effective Time, and to provide such persons with certain indemnification
rights under Bradley's Articles of Amendment and Restatement (the "Bradley
Charter") and Bradley's Bylaws (the "Bradley Bylaws"). Bradley has also
agreed to purchase, at or prior to the Effective Time, liability insurance
coverage for Tucker's directors and officers for a period of six years which
will provide the directors and officers with $10,000,000 of aggregate
coverage. In addition, Bradley has agreed to adopt certain amendments to
Tucker's existing indemnification agreements with its directors. See "The
Merger--Interests of Certain Officers and Directors of Tucker" and "The Merger
Agreement--Indemnification." In connection with the execution of the Merger
Agreement, Bradley, Tucker and certain of the limited partners of TOP,
including the Management Directors, agreed to an amendment and restatement of
the TOP Agreement of Limited Partnership (the "TOP Partnership Agreement"),
which, among other things, limits in certain respects the environmental
indemnification obligations of the Management Directors under the TOP
Partnership Agreement and grants to the limited partners certain registration
rights with respect to shares of Bradley Common Stock which they may receive
upon redemption of TOP Units. In connection with the consummation of the
Merger, Kenneth and Richard Tucker also have agreed to transfer their equity
interests in Tucker Management Corp. ("TMC") to two individuals who are
officers of Bradley for $500 each at or prior to the Effective Time. See "The
Merger Agreement--Transfer of Interests in TMC."
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
Mayer, Brown & Platt, counsel for Tucker, has delivered its opinion to
Tucker substantially to the effect that, on the basis of facts,
representations and assumptions set forth in such opinion, the Merger will be
treated for United States federal income tax purposes as a reorganization
within the meaning of Section 368(a)(1)(A) of the Code. Accordingly, (i) no
gain or loss will be recognized by Tucker as a result of the Merger, and (ii)
no gain or loss will be recognized by any stockholder of Tucker who receives
Bradley Common Stock in exchange for Tucker Common Stock (except with respect
to any cash received in lieu of a fractional interest in Bradley Common
Stock). Goodwin, Procter & Hoar, counsel for Bradley, has delivered its
opinion to Bradley substantially to the effect that, on the basis of facts,
representations and assumptions set forth in such opinion, the Merger will be
treated for United States federal income tax purposes as a reorganization
within the meaning of Section 368(a)(1)(A) of the Code. Accordingly, no gain
or loss will be recognized by Bradley as a result of the Merger. See "The
Merger--Certain Federal Income Tax Consequences" and "The Merger Agreement--
Conditions to the Merger."
ACCOUNTING TREATMENT
Bradley will account for the Merger as a purchase in accordance with
Accounting Principles Board Opinion No. 16. See "The Merger--Accounting
Treatment."
6
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CERTAIN RESALE RESTRICTIONS
All shares of Bradley Common Stock received by Tucker stockholders in the
Merger will be freely transferable, except that shares of Bradley Common Stock
received by persons who are deemed to be "affiliates" (as such term is defined
under the Securities Act of 1933, as amended (the "Securities Act")) of Tucker
at the time of the Special Meeting of Tucker stockholders may be resold by
them only in certain permitted circumstances. See "The Merger--Certain Resale
Restrictions."
NEW YORK STOCK EXCHANGE LISTING
It is a condition to Tucker's and Bradley's obligations to consummate the
Merger that, prior to the Effective Time, Bradley obtain the approval for the
listing of the shares of Bradley Common Stock issuable in the Merger on the
NYSE, subject to official notice of issuance. See "The Merger--New York Stock
Exchange Listing" and "The Merger Agreement--Conditions to the Merger."
DISSENTERS' RIGHTS
Under the Maryland General Corporation Law ("MGCL"), stockholders of
Tucker and Bradley are not entitled to dissenters' rights in connection with
the Merger. See "The Merger--Dissenters' Rights."
RISK FACTORS
In considering whether to approve the Merger and the Merger Agreement,
stockholders of Bradley and Tucker should consider, in addition to the other
information in this Joint Proxy Statement/Prospectus, the matters discussed
under "Risk Factors." Such matters include:
. Possible adverse consequences to the stockholders of Bradley as a
result of (i) the increase of the amount of total debt payable by the
Surviving Company to approximately $220.5 million after the Merger as
compared to $34.7 million for Bradley as of September 30, 1995; (ii)
the increase in the Surviving Company's pro forma ratio of debt to
Total Market Capitalization to approximately 46% after the Merger as
compared to 18% for Bradley as of September 30, 1995; and (iii) the
increase in the amount of the Surviving Company's adjustable interest
rate debt to approximately $82.4 million after the Merger as compared
to $9.8 million for Bradley as of September 30, 1995.
. Risks associated with the Surviving Company's potential inability to
refinance indebtedness when due on reasonable terms and conditions,
including approximately $100,000,000 of indebtedness relating to the
Tucker REMIC Note which matures in September 2000.
. Restrictions on the ability of the Surviving Company to dispose of
properties collateralizing the Tucker REMIC Note or to prepay the
Tucker REMIC Note. Pursuant to the terms of the Tucker REMIC
Indenture, prior to October 1997, the principal amount of the Tucker
REMIC Note cannot be prepaid and the Tucker properties securing the
Tucker REMIC Note cannot be sold. If the Surviving Company wishes
either to prepay principal amounts of the Tucker REMIC Note or to sell
any of the properties collateralizing the Tucker REMIC Note after such
date, it will incur significant prepayment penalties. See "Risk
Factors--Restrictions on Ability of Surviving Company to Dispose of
Properties Collateralizing the Tucker REMIC Note or to Prepay the
Tucker REMIC Note." The Amended TOP Partnership Agreement also
contains certain restrictions on the sale of properties held by TOP.
See "The Merger Agreement--Amended TOP Partnership Agreement."
. Reduction in dividends per share to Tucker stockholders following
consummation of the Merger. Assuming the Surviving Company continues
to make regular quarterly distributions at Bradley's current rate of
$.33 per share, each stockholder of Tucker will receive an equivalent
quarterly dividend payment of $.219 per share (assuming an Exchange
Ratio of .665) or $.226 per share
7
<PAGE>
(assuming an Exchange Ratio of .686), as compared to Tucker's most
recent quarterly dividend of $.25 per share.
. Possible adverse consequences to Tucker's stockholders associated with
a decline in the price of Bradley Common Stock between the date of
this Joint Proxy Statement/Prospectus and the Effective Time.
. Risks associated with a possible reduction in the price of Bradley
Common Stock following the Effective Time, due to future sales of the
Surviving Company's common stock or the potential for sales of the
Surviving Company's common stock by current Tucker stockholders.
. Possible conflicts of interests due to the fact that certain members
of the Board of Directors and management of Tucker have certain
interests in, and will receive certain benefits from, the Merger that
are separate from the interests of and benefits to stockholders of
Tucker generally. See "The Merger--Interests of Certain Officers and
Directors of Tucker."
. Certain differences between the rights of stockholders of Tucker under
Tucker's Articles of Amendment and Restatement (the "Tucker Charter")
and Tucker's Bylaws (the "Tucker Bylaws") and the rights of
stockholders of Bradley under the Bradley Charter and the Bradley
Bylaws. See "Comparison of Stockholder Rights."
. Possible payment of a termination fee and expenses by Tucker to
Bradley. If the Merger Agreement were to be terminated under certain
circumstances and/or Tucker were to enter into an acquisition
agreement with a third party under certain circumstances, Tucker would
be required to pay Bradley a termination fee of $3,000,000 plus
reimbursement of Bradley's out-of-pocket expenses up to $2,000,000. If
the Merger Agreement is terminated in certain other circumstances,
Tucker will be required to reimburse Bradley for its out-of-pocket
expenses up to $2,000,000.
THE MERGER AGREEMENT
EFFECTIVE TIME OF THE MERGER
In accordance with the MGCL, the Merger will become effective upon the
acceptance for record of the Articles of Merger by the State Department of
Assessments and Taxation of Maryland. Subject to the fulfillment (or waiver)
of the other conditions to the obligations of Bradley and Tucker to consummate
the Merger, it is currently expected that the Merger will be consummated as
soon as practicable following the approval by the stockholders of Bradley and
Tucker of the Merger and the Merger Agreement at their respective Special
Meetings of Stockholders. See "The Merger Agreement--Effective Time of the
Merger."
EXCHANGE OF TUCKER STOCK CERTIFICATES
Promptly after the Effective Time, a designated exchange agent (the
"Exchange Agent") will mail a letter of transmittal and instructions to each
holder of record of a certificate representing shares of Tucker Common Stock
(a "Certificate") as of the Effective Time for use in effecting the surrender
of the Certificate in exchange for certificates representing shares of Bradley
Common Stock and cash in lieu of fractional shares. Upon surrender of a
Certificate for cancellation to the Exchange Agent, together with such letter
of transmittal, duly executed and completed in accordance with the
instructions thereto, the holder of such Certificate will be entitled to
receive in exchange therefor (i) a certificate representing the number of
whole shares of Bradley Common Stock to which such holder shall be entitled,
and (ii) a check representing the amount of cash in lieu of fractional shares,
if any, plus the amount of any dividends or distributions, if any, as provided
in the Merger Agreement, after giving effect to any required withholding tax,
and the Certificate so surrendered will be canceled. Certificates should not
be surrendered until the letter of transmittal and instructions are received.
See "The Merger Agreement--Exchange of Tucker Stock Certificates."
8
<PAGE>
CONDITIONS TO THE MERGER
The respective obligations of Bradley and Tucker to effect the Merger and
the other transactions contemplated in the Merger Agreement are subject to the
fulfillment or waiver of certain conditions at or prior to the Effective Time
including, among others: (a) approval of the Merger and the Merger Agreement
by the requisite vote of stockholders of Tucker and Bradley; (b) receipt of
various third-party consents, including the consent (the "Tucker REMIC
Consent") of the Indenture Trustee under the Tucker REMIC Indenture and the
consent of each of the lenders under Bradley's and Tucker's credit agreements;
(c) execution by Tucker and all of the limited partners of TOP of the Amended
TOP Partnership Agreement; (d) receipt by Bradley of a letter from Coopers &
Lybrand L.L.P., independent public accountants for Tucker, certifying, among
other things, that for federal income tax purposes, Tucker will not have any
accumulated or current earnings or profits immediately prior to the Effective
Time; and (e) receipt by Bradley of a private letter ruling from the Internal
Revenue Service (the "IRS") to the effect that following the consummation of
the Merger, each of TFC and Tucker Properties Investments, Inc. ("TPI") will
qualify as a "qualified REIT subsidiary" of Bradley under Section 856(i) of
the Code. See "The Merger Agreement--Conditions to the Merger."
TERMINATION
The Merger Agreement may be terminated and abandoned at any time prior to
the Effective Time, whether before or after approval of the Merger and the
Merger Agreement, by the stockholders of Tucker and Bradley, in a number of
circumstances, including, among others: (a) by the mutual written consent of
Tucker and Bradley; (b) by either Tucker or Bradley if (i) the Merger
Agreement and the transactions contemplated thereby shall have failed to
receive the requisite vote for approval by the stockholders of Bradley or
Tucker upon the holding of a duly convened stockholder meeting, or (ii) the
Merger shall not have been consummated on or before June 30, 1996 (other than
due to the failure of the party seeking to terminate the Merger Agreement to
perform its obligations under the Merger Agreement required to be performed by
it at or prior to the Effective Time); (c) by action of Tucker if (i) the
Board of Directors of Tucker recommends to Tucker's stockholders approval or
acceptance of an Acquisition Proposal (as defined below in "The Merger
Agreement--No Solicitation of Transactions") by a person other than Bradley,
but only in the event that the Board of Directors of Tucker, after
consultation with and based upon the advice of Mayer, Brown & Platt or another
nationally recognized law firm, has determined in good faith that such action
is necessary for the Board of Directors of Tucker to comply with its fiduciary
duties to its stockholders under applicable law, or (ii) the Board of
Directors of Bradley recommends to Bradley's stockholders approval or
acceptance of a proposal by a person other than Tucker to acquire 50% or more
of the assets or stock of Bradley, by way of merger, tender offer, exchange
offer or similar transaction; or (d) by action of Bradley if the Board of
Directors of Tucker shall have recommended that stockholders of Tucker accept
or approve an Acquisition Proposal by a person other than Bradley. See "The
Merger Agreement--Termination."
TERMINATION AMOUNT AND EXPENSES
If (a) Bradley terminates the Merger Agreement because (i) the Board of
Directors of Tucker has recommended that stockholders of Tucker accept or
approve an Acquisition Proposal by a person other than Bradley (or Tucker or
its Board has resolved to do such), or (ii) any representation, warranty,
covenant or agreement on the part of Tucker set forth in the Merger Agreement
has been willfully breached; or (b) Tucker terminates the Merger Agreement
because the Board of Directors of Tucker, after consultation with and based
upon the advice of Mayer, Brown & Platt or another nationally recognized law
firm, has determined in good faith that its fiduciary duties to its
stockholders under applicable law require it to recommend to its stockholders
approval or acceptance of an Acquisition Proposal by a person other than
Bradley, then Tucker shall pay to Bradley an amount (the "Termination Amount")
in cash equal to the sum of $3,000,000 plus Bradley's out-of-pocket costs and
expenses in connection with the Merger Agreement and the transactions
contemplated thereby, up to $2,000,000.
If Bradley terminates the Merger Agreement because (i) the Board of
Directors of Tucker has failed to make, or has withdrawn, amended, modified or
changed its approval or recommendation of the Merger Agreement or any of the
transactions contemplated thereby; (ii) Tucker has failed as soon as
practicable to mail
9
<PAGE>
this Joint Proxy Statement/Prospectus to its stockholders or to include the
recommendation of its Board of Directors of the Merger Agreement and the
transactions contemplated thereby in this Joint Proxy Statement/Prospectus;
(iii) Tucker or its Board of Directors has resolved to do either (i) or (ii)
above; or (iv) any representation, warranty, covenant or agreement on the part
of Tucker set forth in the Merger Agreement has been breached or become
untrue, as the case may be, and is incapable of being satisfied by June 30,
1996 (except for a termination because of a willful breach by Tucker in which
case the previous paragraph will apply), Tucker shall pay all of Bradley's
out-of-pocket costs and expenses in connection with the Merger Agreement and
the transactions contemplated thereby, up to $2,000,000 ("Expenses").
If at any time within one year after termination of the Merger Agreement,
unless such termination was pursuant to certain events or circumstances
specified in the Merger Agreement, Tucker enters into an agreement relating to
an Acquisition Proposal with a person other than Bradley or Tucker's Board of
Directors recommends or resolves to recommend to Tucker's stockholders
approval or acceptance of an Acquisition Proposal with a person other than
Bradley, then, upon the entry into such agreement or the making of such
recommendation or resolution, Tucker shall pay to Bradley the Termination
Amount, which amount shall be reduced by any monies previously paid by Tucker
to Bradley pursuant to the previous paragraphs. See "The Merger Agreement--
Termination Amount and Expenses."
THE MEETINGS OF STOCKHOLDERS
BRADLEY SPECIAL MEETING
The Special Meeting of Bradley's stockholders will be held at
__________________, Boston, Massachusetts _____, on February __, 1996, at
10:00 a.m., Eastern time (including any and all adjournments and postponements
thereof, the "Bradley Special Meeting"). At the Bradley Special Meeting,
holders of Bradley Common Stock will consider and vote upon a proposal to
approve the Merger and the Merger Agreement. This proposal must be approved by
the affirmative vote of the holders of a majority of the outstanding shares of
Bradley Common Stock entitled to vote thereon. Holders of Bradley Common Stock
are entitled to one vote per share. Only holders of Bradley Common Stock at
the close of business on January __, 1996 (the "Bradley Record Date") will be
entitled to notice of and to vote at the Bradley Special Meeting. As of the
Bradley Record Date, directors and executive officers of Bradley, all of whom
have indicated that they will vote all of their shares of Bradley Common Stock
for approval of the Merger and the Merger Agreement, and their affiliates were
owners of approximately 64,000 shares of Bradley Common Stock, representing
less than 1% of the outstanding shares of Bradley Common Stock. See "The
Meetings of Stockholders--Bradley Special Meeting."
THE BOARD OF DIRECTORS OF BRADLEY HAS UNANIMOUSLY APPROVED THE MERGER AND
THE MERGER AGREEMENT AND UNANIMOUSLY RECOMMENDS THAT BRADLEY STOCKHOLDERS VOTE
FOR APPROVAL OF THE MERGER AND THE MERGER AGREEMENT. SEE "THE MERGER--
BACKGROUND OF THE MERGER" AND "--REASONS FOR THE MERGER; RECOMMENDATION OF THE
BOARD OF DIRECTORS OF BRADLEY."
TUCKER SPECIAL MEETING
The Special Meeting of Tucker's stockholders will be held at
______________________, Chicago, Illinois _____, on February __, 1996, at 9:00
a.m., Central time (including any and all adjournments and postponements
thereof, the "Tucker Special Meeting"). At the Tucker Special Meeting, holders
of Tucker Common Stock will consider and vote upon a proposal to approve the
Merger and the Merger Agreement. This proposal must be approved by the
affirmative vote of the holders of two-thirds of the outstanding shares of
Tucker Common Stock entitled to vote thereon. Holders of Tucker Common Stock
are entitled to one vote per share. Only holders of Tucker Common Stock at the
close of business on January __, 1996 (the "Tucker Record Date") will be
entitled to notice of and to vote at the Tucker Special Meeting. As of the
Tucker Record Date, directors and executive officers of Tucker, all of whom
have indicated that they will vote all of their shares of Tucker Common Stock
for approval of the Merger and the Merger Agreement, and their affiliates
10
<PAGE>
were beneficial owners of 112,583 shares of Tucker Common Stock, representing
approximately 1% of the outstanding shares of Tucker Common Stock. See "The
Meetings of Stockholders--Tucker Special Meeting."
THE BOARD OF DIRECTORS OF TUCKER HAS UNANIMOUSLY APPROVED THE MERGER AND
THE MERGER AGREEMENT AND UNANIMOUSLY RECOMMENDS THAT TUCKER STOCKHOLDERS VOTE
FOR APPROVAL OF THE MERGER AND THE MERGER AGREEMENT. SEE "THE MERGER--
BACKGROUND OF THE MERGER," "--REASONS FOR THE MERGER; RECOMMENDATION OF THE
BOARD OF DIRECTORS OF TUCKER" AND "--INTERESTS OF CERTAIN OFFICERS AND
DIRECTORS OF TUCKER."
COMPARISON OF STOCKHOLDER RIGHTS
The rights of stockholders of Tucker, a Maryland corporation, currently
are governed by Maryland law, the Tucker Charter and the Tucker Bylaws. Upon
completion of the Merger, stockholders of Tucker will become stockholders of
Bradley, a Maryland corporation, and their rights as stockholders of Bradley
will be governed by Maryland law, the Bradley Charter and the Bradley Bylaws.
Certain differences between the rights of stockholders of Tucker and the
rights of stockholders of Bradley include the following: (i) the affirmative
vote of two-thirds of the outstanding shares of Tucker Common Stock is
required to amend the Tucker Charter or to approve a merger, consolidation,
share exchange or sale of all or substantially all of the assets of Tucker,
whereas the affirmative vote of a majority of the outstanding shares of
Bradley Common Stock is required for comparable actions involving Bradley;
(ii) the Bradley Charter provides for three classes of directors, with the
term of office of one class expiring each year, whereas the Tucker Charter
provides that all of its directors are elected each year at the annual meeting
of stockholders; (iii) the holders of not less than 10% of the outstanding
shares of Tucker Common Stock may call a special meeting of Tucker's
stockholders, whereas the holders of not less than 25% of the outstanding
shares of Bradley Common Stock may call a special meeting of Bradley's
stockholders; (iv) the Tucker Board of Directors has exempted certain
transactions from the Maryland business combination statute (including the
Merger), whereas Bradley has not made any such exemptions (except that
Bradley's Board of Directors has exempted the Merger from such statute); (v)
the Bradley Charter generally limits any holder from acquiring more than 9.8%
of the value of all outstanding capital stock of Bradley while the Tucker
Charter generally limits any holder from acquiring more than 7% of the value
of the issued and outstanding stock of Tucker (in the case of Bradley, this
ownership limitation does not apply to shares of capital stock acquired
pursuant to certain all cash tender offers for all of the outstanding shares
of capital stock); and (vi) the holders of Tucker Common Stock may only amend
certain provisions of the Tucker Bylaws, whereas the holders of Bradley Common
Stock may amend any provision of the Bradley Bylaws. See "Comparison of
Stockholder Rights."
11
<PAGE>
SUMMARY HISTORICAL AND UNAUDITED PRO FORMA COMBINED FINANCIAL DATA
BRADLEY REAL ESTATE, INC.
SUMMARY HISTORICAL AND UNAUDITED PRO FORMA COMBINED FINANCIAL DATA
The following tables set forth financial information for Bradley on a
historical and on a pro forma basis and should be read in conjunction with,
and are qualified in their entirety by, the respective historical financial
statements and notes thereto of Bradley and Tucker incorporated by reference
into this Joint Proxy Statement/Prospectus. The financial information
presented below includes the accounts of Bradley (including its predecessor
Bradley Real Estate Trust) and, for the pro forma information, the accounts of
Tucker and of its subsidiaries whose accounts are combined and consolidated
with the Tucker accounts.
The stock price used to determine the purchase consideration paid by
Bradley in the pro forma financial statements is $14.125 per share, which
represents an estimated Closing Price based upon the estimated average closing
prices of Bradley Common Stock on the NYSE over the 20 trading days prior to
the fifth day preceding the date of filing of this Joint Proxy
Statement/Prospectus with the Commission.
During the period from January 1, 1994 to September 30, 1995, Bradley
acquired three properties, sold one property, effected a $125,000,000 shelf
registration statement, acquired the REIT advisory business of its long-
standing external advisor, completed a public offering of 2,500,000 shares of
Bradley Common Stock (the "July Offering") and repaid certain fixed rate
mortgage debt.
In March 1994, Bradley purchased the 429,000 square foot Rivercrest
Center in Crestwood, Illinois ("Rivercrest") for $24,500,000. The purchase of
Rivercrest was financed through borrowings under Bradley's $65,000,000 secured
revolving line of credit with The First National Bank of Boston, lead lender
with Fleet Bank, N.A. and Wells Fargo Realty Advisors Funding, Incorporated
(the "Bradley Line of Credit"). In November 1994, Bradley acquired Westwind
Plaza, an 88,000 square foot community shopping center located in Minnetonka,
Minnesota ("Westwind"), for $7,500,000. Westwind was purchased with the
assumption of $5,000,000 of mortgage debt, with the balance paid through a
tax-deferred exchange from the sale of Spruce Tree Centre, a mixed-use
office/retail property in St. Paul, Minnesota ("Spruce Tree"). In April 1995,
Bradley acquired St. Francis Plaza, a 30,000 square foot shopping center
located in Santa Fe, New Mexico ("St. Francis Plaza"), for $5,200,000. St.
Francis Plaza was purchased with the assumption of approximately $2,100,000 of
mortgage debt and the cash proceeds from the sale of 182,500 shares of Bradley
Common Stock to the former owner of St. Francis Plaza.
On January 31, 1995, following stockholder approval, Bradley acquired
the REIT advisory business of its long-standing external advisor and thereby
became a self-administered REIT. The acquisition, pursuant to which Bradley
issued 325,000 shares of Bradley Common Stock to the owners of the advisor,
resulted in the termination of an advisory arrangement extending through
August 1999.
On July 6, 1995, Bradley completed the July Offering at a price of
$16 per share. Net proceeds from the July Offering were approximately
$37,405,000, of which $32,600,000 was used to pay down the Bradley Line of
Credit, $4,712,000 was used to pay off the non-recourse mortgages assumed in
November 1994 upon the acquisition of Westwind and the balance was used for
general business purposes.
In June 1994, Tucker acquired the Pavilion at Mequon, a community
shopping center aggregating approximately 212,000 square feet of gross
leasable area located in Mequon, Wisconsin (the "Mequon Pavilion"). The
Mequon Pavilion was purchased for $18,300,000 which was financed through a
$13,500,000 mortgage note and borrowings for the balance under the $50,000,000
collateralized revolving line of credit with The First National Bank of
Boston, lead lender with Mellon Bank, N.A. (the "Tucker Line of Credit").
The unaudited pro forma operating and other data are presented as if
the Bradley and Tucker acquisitions, disposition and capital transactions,
described above, and the Merger had been consummated on January 1, 1994, with
Bradley qualifying as a REIT, distributing all of its taxable income and,
therefore, incurring no
12
<PAGE>
federal income tax expense during the period from January 1, 1994 to September
30, 1995. The Merger has been accounted for under the purchase method of
accounting in accordance with Accounting Principles Board Opinion No. 16.
The unaudited pro forma operating and other data are presented for
comparative purposes only and are not necessarily indicative of what the
actual results of operations of Bradley would have been for the periods
presented, nor does such data purport to represent the results to be achieved
in future periods.
<TABLE>
<CAPTION>
Nine Months Ended September 30,
-------------------------------------------------------
Pro Forma(1) Historical
------------ ----------------------------------
1995 1995 1994
---- ---- ----
(In thousands except per share data)
<S> <C> <C> <C>
OPERATING DATA:
Income:
Rental income........................................ $ 63,787 $ 26,697 $ 24,467
Other income......................................... 1,046 141 62
----------- ---------- --------
Total revenue....................................... 64,833 26,838 24,529
----------- ---------- --------
Expenses:
Operations, maintenance and management............... 10,285 4,235 3,854
Real estate taxes.................................... 14,294 6,380 6,304
Mortgage and other interest.......................... 12,884 3,826 3,100
Depreciation and amortization........................ 9,910 5,413 3,692
Administrative and general........................... 2,346 1,154 1,641
----------- ---------- --------
Total expenses...................................... 49,719 21,008 18,591
----------- ---------- --------
Income before allocation to minority interest.......... 15,114 5,830 5,938
Income allocated to minority interest.................. (64) -- --
----------- ---------- --------
Net income............................................. $ 15,050 $ 5,830 $ 5,938
=========== ========== ========
Net income per share................................... $ .81(2) $ .62 $ .72
OTHER DATA:
Funds from operations(3)............................... 24,796(4) 11,243 9,630
Funds from operations per share(3)..................... 1.33(2)(4) 1.20 1.18
Distributions per share................................ 1.00(2) .99 .96
Weighted average number of shares outstanding.......... 18,628(2) 9,404 8,191
</TABLE>
<TABLE>
<CAPTION> September 30,
-----------------------------------
Pro Forma(5) Historical
----------- --------------
1995 1995
---- ----
(In thousands)
<S> <C> <C>
BALANCE SHEET DATA:
Net real estate investments................................... $ 453,870 $ 158,392
Total assets.................................................. 494,333 178,855
Mortgage and bank loans payable............................... 220,458 34,667
Total liabilities............................................. 248,809 42,700
Total stockholders' equity.................................... 241,078 136,155
</TABLE>
See footnotes on page 15.
13
<PAGE>
<TABLE>
<CAPTION>
Year Ended December 31,
----------------------------------------------------------------------
Pro Forma(1) Historical
------------ ------------------------------------------------------
1994 1994 1993 1992 1991 1990
---- ---- ---- ---- ---- ----
(In thousands except per share data)
<S> <C> <C> <C> <C> <C> <C>
OPERATING DATA:
Income:
Rental income............................... $ 83,705 $ 32,875 $ 22,875 $11,839 $10,352 $ 9,733
Other income................................ 1,360 112 594 308 202 72
-------- -------- -------- ------- ------- -------
Total revenue.............................. 85,065 32,987 23,469 12,147 10,554 9,805
-------- -------- -------- ------- ------- -------
Expenses:
Operations, maintenance and
management................................. 11,584 5,315 3,731 1,821 1,839 1,762
Real estate taxes........................... 18,107 8,070 5,772 2,259 2,008 1,782
Mortgage and other interest................. 14,592 4,524 2,947 3,596 3,006 2,516
Depreciation and amortization............... 12,766 5,146 3,564 2,178 1,764 1,609
Administrative and general.................. 4,438 2,288 1,920 1,331 1,233 1,422
Tenant abandonment.......................... -- -- -- 175 -- --
-------- -------- -------- ------- ------- -------
Total expenses............................ 61,487 25,343 17,934 11,360 9,850 9,091
-------- -------- -------- ------- ------- -------
Income before gain on sale of property and
allocation to minority interest............. 23,578 7,644 5,535 787 704 714
Gain on sale of property....................... -- 983 -- -- -- --
Income allocated to minority interest.......... (392) -- -- -- -- --
-------- -------- -------- ------- ------- -------
Net income..................................... $ 23,186 $ 8,627 $ 5,535 $ 787 $ 704 $ 714
======== ======== ======== ======= ======= =======
Net income per share........................... $ 1.24(2) $ 1.05 $ .82 $ .40 $ .38 $ .36
OTHER DATA:
Funds from operations(3)....................... 35,740(4) 12,790 9,099 2,965 2,468 2,323
Funds from operations per share(3)............. 1.92(2)(4) 1.56 1.35 1.50 1.30 1.17
Distributions per share........................ 1.42(2) 1.29 1.22 1.20 1.20 1.50
Weighted average number of shares
outstanding................................... 18,628(2) 8,192 6,716 1,972 1,898 1,987
</TABLE>
<TABLE>
<CAPTION>
December 31,
Historical
-----------------------------------------------------------------
1994 1993 1992 1991 1990
---- ---- ---- ---- ----
(In thousands)
<S> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Net real estate investments.................... $155,554 $120,033 $ 83,750 $44,399 $35,957
Total assets................................... 166,579 127,931 93,326 50,345 39,055
Mortgage and bank loans payable................ 66,748 29,317 44,085 40,685 28,880
Total liabilities.............................. 72,000 31,547 45,482 41,973 29,109
Total stockholders' equity..................... 94,579 96,384 47,844 8,372 9,946
</TABLE>
See footnotes on page 15.
14
<PAGE>
(1) Pro forma data includes operating revenues and expenses for the nine
months ended September 30, 1995 and for the year ended December 31, 1994
for the Bradley and Tucker properties acquired between January 1, 1994
and September 30, 1995 for the period during which Bradley and Tucker did
not own them. For the nine months ended September 30, 1995 and the year
ended December 31, 1994, Bradley pro forma mortgage and other interest
has been increased by approximately $514,000 and $604,000, respectively,
for the borrowings estimated for payment of fees and expenses related to
the Merger. Bradley pro forma depreciation and amortization for the nine
months ended September 30, 1995 and the year ended December 31, 1994 has
been decreased by approximately $4,356,000 and $4,394,000, respectively,
to give effect to recording the acquisition of Tucker's properties at
Bradley's purchase price. Bradley pro forma administrative and general
expense for the nine months ended September 30, 1995 and the year ended
December 31, 1994 has been decreased by approximately $1,050,000 and
$1,400,000, respectively, for estimated cost savings which will be
achieved as a result of the Merger.
(2) The Exchange Ratio used in the pro forma financial statements was .686 of
a share of Bradley Common Stock per share of Tucker Common Stock. If the
Exchange Ratio was .665, then pro forma net income per share for the nine
months ended September 30, 1995 and for the year ended December 31, 1994
would have been $.81 and $1.25, respectively; pro forma FFO per share
would have been $1.35 and $1.94, respectively; pro forma distributions
per share would have been $1.02 and $1.43, respectively; and pro forma
weighted average number of shares outstanding would have been 18,400,139
and 18,400,139, respectively.
(3) Defined by the National Association of Real Estate Investment Trusts as
"net income (computed in accordance with generally accepted accounting
principles), excluding gains (or losses) from debt restructuring and
sales of property, plus depreciation and amortization, and after
adjustments for unconsolidated partnerships and joint ventures." FFO
differs from net cash provided by operating activities primarily because
FFO does not include changes in operating assets and liabilities. FFO is
a supplemental measure of performance that does not replace net income as
a measure of performance or net cash provided by operating activities as
a measure of liquidity.
(4) Depreciation and amortization added back to net income in the calculation
of FFO is net of depreciation and amortization allocated to minority
interest of approximately $164,000 and $212,000 for the nine months ended
September 30, 1995 and the year ended December 31, 1994, respectively.
(5) The pro forma balance sheet was prepared as if the Merger had been
consummated on September 30, 1995.
15
<PAGE>
TUCKER PROPERTIES CORPORATION
SUMMARY HISTORICAL FINANCIAL DATA
The following tables set forth financial information for Tucker which
should be read in conjunction with, and is qualified in its entirety by, the
historical financial statements and notes thereto of Tucker incorporated by
reference into this Joint Proxy Statement/Prospectus.
<TABLE>
<CAPTION>
Year Ended December 31,
-------------------------------------------------------------------
Tucker Properties Predecessor
Corporation Business
----------------- ------------------------------
1994 1993(1) 1992 1991 1990
---- ------- ---- ---- ----
(In thousands except per share data)
<S> <C> <C> <C> <C> <C>
OPERATING DATA:
Total revenues................................ $ 49,157 $ 27,354 $ 17,760 $11,264 $ 6,665
Income (loss) before allocation to
minority interests and
extraordinary item........................... 8,244 (791) (646) (4,362) (1,702)
Net income (loss)............................. 7,852 (11,390) (646) (4,362) (1,702)
Income (loss) per share before
extraordinary item .73 (.08) -- -- --
Net income (loss) per share................... .73 (1.05) -- -- --
</TABLE>
<TABLE>
<CAPTION>
As of December 31,
-------------------------------------------------------
Tucker Properties Predecessor
Corporation Business
-------------------------------------------------------
1994 1993 1992 1991 1990
---- ---- ---- ---- ----
(In thousands except per share data)
<S> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Net real estate investments................... $287,508 $272,691 $108,516 $84,168 $50,037
Total assets.................................. 322,160 300,252 118,026 89,008 52,831
Mortgage notes payable........................ 125,474 111,974 118,225 86,790 49,355
Lines of credit borrowings.................... 38,939 22,378 -- -- --
Predecessor business owners' deficit.......... -- -- (10,718) (7,635) (3,795)
Stockholders' equity.......................... 135,184 144,168 -- -- --
Dividends/distributions declared (per share).. 1.46 .32 -- -- --
OTHER DATA:
Properties owned.............................. 13 11 4 2 0
Investments in joint ventures................. 1 1 3 3 3
</TABLE>
_______________________
(1) Operating data for 1993 includes the results of the Predecessor Business
through October 11, 1993 (the date of the initial public offering of
Tucker Common Stock) plus the results of Tucker thereafter.
16
<PAGE>
COMPARATIVE PER SHARE DATA
The following table sets forth Bradley's and Tucker's historical per
share data, unaudited pro forma per share data giving effect to the Merger
using the purchase method of accounting and the equivalent pro forma combined
per share amounts of Tucker. The pro forma combined data are not necessarily
indicative of actual financial position or future operating results or that
which would have occurred or will occur upon consummation of the Merger.
<TABLE>
<CAPTION>
Nine Months Ended Year Ended
September 30, 1995 December 31, 1994
------------------------------------------ -------------------------------------------
Pro Tucker Pro Tucker
Historical Forma(A) Equivalent(B) Historical Forma(A) Equivalent(B)
---------- -------- ------------- ---------- -------- -------------
<S> <C> <C> <C> <C> <C> <C>
Net Income
Bradley.................... $ .62 $ .81 $ 1.05 $ 1.24
Tucker..................... .14 $ .56 .73 $ .85
Funds from Operations(C)
Bradley.................... 1.20 1.33 1.56 1.92
Tucker..................... .92 .91 1.62 1.32
Cash Distributions/Dividends(D)
Bradley.................... .99 1.00 1.29 1.42
Tucker..................... .86 .69 1.46 .97
Book Value per Common Share
Bradley.................... 12.13 12.92 11.54 13.14
Tucker..................... 11.76 8.86 12.48 9.01
</TABLE>
__________
(A) The pro forma combined per share data for Bradley and Tucker for the nine
months ended September 30, 1995 and the year ended December 31, 1994 have
been prepared as if the Bradley capital transactions occurring between
January 1, 1994 and September 30, 1995 and the Merger had occurred prior
to the beginning of the period presented, resulting in weighted average
shares outstanding of 18,627,533 for both periods. The pro forma
combined book value per share for Bradley and Tucker has been prepared
assuming that in the Merger each share of Tucker Common Stock is
converted into .686 of a share of Bradley Common Stock, resulting in
total outstanding shares of Bradley Common Stock of 18,654,826 at
September 30, 1995. Assuming that each share of Tucker Common Stock is
converted into .665 of a share of Bradley Common Stock, the pro forma
combined book value per share would be $13.64 at September 30, 1995
(based upon 18,427,432 shares outstanding) and $13.87 at December 31,
1994 (based upon 18,405,362 shares outstanding).
(B) The equivalent pro forma combined per share amounts of Tucker are
calculated by multiplying pro forma Net Income per share of Bradley
Common Stock, pro forma FFO per share of Bradley Common Stock, pro forma
Cash Distributions/Dividends per share of Bradley Common Stock and pro
forma Book Value per share of Bradley Common Stock by an assumed Exchange
Ratio of .686. If the Exchange Ratio was .665, then equivalent pro forma
Net Income per share for the nine months ended September 30, 1995 and for
the year ended December 31, 1994 would have been $.54 and $.83,
respectively; equivalent pro forma FFO per share would have been $.90 and
$1.29, respectively; equivalent pro forma Cash Distributions/Dividends
per share would have been $.68 and $.95, respectively; equivalent pro
forma Book Value per share would have been $9.07 and $9.22, respectively;
and equivalent pro forma number of shares outstanding would have been
7,200,808 and 7,200,808, respectively.
(C) Defined by the National Association of Real Estate Investment Trusts as
"net income (computed in accordance with generally accepted accounting
principles), excluding gains (or losses) from debt restructuring and
sales of property, plus depreciation and amortization, and after
adjustments for unconsolidated partnerships and joint ventures." FFO
differs from net cash provided by operating activities primarily because
FFO does not include changes in operating assets and liabilities. FFO is
a supplemental measure of performance that does not replace net income as
a measure of performance or net cash provided by operating activities as
a measure of liquidity.
(D) Bradley currently pays a quarterly distribution of $.33 per share.
Bradley currently intends to continue to pay such regular quarterly
distribution. Future distributions by Bradley will be at the discretion
of its Board of Directors and will depend on certain factors. See "--
Distribution and Dividend Policy."
17
<PAGE>
COMPARATIVE MARKET DATA
The Bradley Common Stock has traded on the NYSE (symbol "BTR") since
October 18, 1994 and before that date traded for many years on the American
Stock Exchange. The Tucker Common Stock has traded on the NYSE (symbol "TUC")
since October 5, 1993. The table below sets forth, for the calendar quarters
indicated, the high and low sales prices per share reported by the NYSE
Composite Tape or on the American Stock Exchange, as the case may be, and
dividends paid for the Bradley Common Stock and the Tucker Common Stock
(adjusted in the case of Bradley for a reverse stock split in 1994).
<TABLE>
<CAPTION>
Bradley Common Stock Tucker Common Stock
-------------------------------- ------------------------------
Per Share Per Share
High Low Dividends High Low Dividends
---- --- --------- ---- --- ---------
<S> <C> <C> <C> <C> <C> <C>
1994:
First Quarter................... $ 18 3/4 $ 16 3/4 $ .32 $ 18 1/2 $ 16 3/8 $ .36
Second Quarter.................. $ 19 1/4 $ 16 3/4 $ .32 $ 18 1/8 $ 15 5/8 $ .36
Third Quarter................... $ 17 3/4 $ 14 1/2 $ .32 $ 16 3/4 $ 14 7/8 $ .38
Fourth Quarter.................. $ 15 3/4 $ 13 3/8 $ .33 $ 17 $ 11 1/2 $ .36
1995
First Quarter................... $ 16 3/4 $ 14 7/8 $ .33 $ 12 7/8 $ 11 $ .36
Second Quarter.................. $ 16 3/8 $ 15 $ .33 $ 13 5/8 $ 10 5/8 $ .25
Third Quarter................... $ 16 7/8 $ 15 3/8 $ .33 $ 12 $ 10 $ .25
Fourth Quarter (through
December 4, 1995)............. $ 16 1/4 $ 131/2 $ 11 1/2 $ 8 3/4
1996:
First Quarter (through
January __, 1996).............
</TABLE>
The following table sets forth the last reported sales prices per share
of Bradley Common Stock and Tucker Common Stock (i) on September 8, 1995, the
last trading day preceding public announcement that Bradley and Tucker were
negotiating a possible acquisition of Tucker by Bradley, (ii) on October 27,
1995, the last trading day preceding public announcement of the terms of the
Merger, and (iii) on January __, 1996, the most recent date for which prices
were available prior to printing this Joint Proxy Statement/Prospectus.
<TABLE>
<CAPTION>
Bradley Tucker
Common Common
Stock Stock
------- -------
<S> <C> <C>
September 8, 1995......................................... $ 167/8 $ 101/2
October 27, 1995.......................................... $ 15 $ 103/8
January __, 1996.......................................... $ $
</TABLE>
BECAUSE THE MARKET PRICE OF BRADLEY COMMON STOCK IS SUBJECT TO
FLUCTUATION, THE MARKET VALUE OF THE BRADLEY COMMON STOCK THAT HOLDERS OF
TUCKER COMMON STOCK WILL RECEIVE IN THE MERGER MAY INCREASE OR DECREASE PRIOR
TO AND FOLLOWING THE MERGER. STOCKHOLDERS ARE URGED TO OBTAIN CURRENT MARKET
QUOTATIONS FOR BRADLEY COMMON STOCK AND TUCKER COMMON STOCK.
18
<PAGE>
DISTRIBUTION AND DIVIDEND POLICY
BRADLEY
Bradley currently pays a regular quarterly distribution of $.33 per share
of Bradley Common Stock (which, annualized, equals $1.32 per share). The
distributions for the nine months ended September 30, 1995 were approximately
84% of Bradley's FFO during such period. Based on the unaudited pro forma
operating data for the nine months ended September 30, 1995 as set forth in
this Joint Proxy Statement/Prospectus under "Summary Historical and Unaudited
Pro Forma Combined Financial Data" and "Unaudited Pro Forma Combined Financial
Statements," the distributions that would have been made by the combined
company on a pro forma basis would have been approximately 75% of Bradley's
FFO during such period.
Further distributions by Bradley will be at the discretion of its Board
of Directors and will depend on the actual FFO of Bradley, its financial
condition, capital requirements, the annual distribution requirements under
the REIT provisions of the Code and such other factors as the Board of
Directors deems relevant. However, Bradley currently intends to continue to
pay regular quarterly distributions of $.33 per share of Bradley Common Stock.
Management believes that based in part on unaudited pro forma per share data
after giving effect to the Merger, there will be sufficient cash available to
make such distributions. Assuming the Surviving Company continues to make
regular quarterly distributions at Bradley's current rate of $.33 per share of
Bradley Common Stock, each stockholder of Tucker would be entitled to receive
a quarterly distribution equivalent to $.219 per share of Tucker Common Stock
(assuming an Exchange Ratio of .665) or $.226 per share of Tucker Common Stock
(assuming an Exchange Ratio of .686).
Bradley maintains a Dividend Reinvestment and Share Purchase Plan
pursuant to which stockholders of record may elect to reinvest cash
distributions and to make limited additional cash payments (minimum $100,
maximum $2,500 per quarter by any one stockholder of record) to purchase newly
issued shares of Bradley Common Stock at 95% of the current market value.
Bradley may suspend or amend such plan at any time. This Joint Proxy
Statement/Prospectus does not constitute an offer of any shares of Bradley
Common Stock that may be issued by Bradley in connection with a distribution
reinvestment program, and such shares may only be purchased pursuant to a
separate prospectus contained in an effective registration statement.
TUCKER
Effective the second quarter of 1995, the Board of Directors of Tucker
reduced Tucker's quarterly cash dividend from $.36 per share to $.25 per
share. Tucker's quarterly cash dividend had previously been reduced from $.38
per share to $.36 per share, effective the fourth quarter of 1994.
Annualized, the quarterly dividend of $.25 per share equals $1.00 per share of
Tucker Common Stock. The dividends for the nine months ended September 30,
1995 were approximately 93% of Tucker's FFO during such period.
19
<PAGE>
RISK FACTORS
In considering whether to approve the Merger and the Merger Agreement,
stockholders of Bradley and Tucker should consider, in addition to the other
information in this Joint Proxy Statement/Prospectus, the material discussed
in this section.
SUBSTANTIAL DEBT OBLIGATIONS AND TERMS OF DEBT
The Surviving Company's pro forma debt obligations after giving effect to
the Merger will aggregate approximately $220.5 million as compared to $34.7
million for Bradley as of September 30, 1995. The pro forma ratio of debt to
Total Market Capitalization of the Surviving Company will be approximately 46%
as compared to 18% for Bradley as of September 30, 1995. This increase in the
Surviving Company's leverage and its pro forma ratio of debt to Total Market
Capitalization could increase the risk of default under its indebtedness.
Failure to pay the debt obligations when due could result in the Surviving
Company losing its interest in the properties collateralizing such
obligations. Certain of Tucker's and Bradley's credit agreements provide that
a default with respect to any other indebtedness of such company shall cause
an event of default under that credit agreement and accelerate the company's
obligations thereunder.
In particular, the maturity of the $100,000,000 Tucker REMIC Note in
September 2000 may increase the Surviving Company's risk of default on its
indebtedness. Prior to the date hereof, each of Tucker and Bradley and their
predecessors have been able to refinance debt when it has become due on terms
which they believe to be commercially reasonable. There can be no assurance
that the Surviving Company will continue to be able to repay or to refinance
its indebtedness relating to the Tucker REMIC Note or any of its other
indebtedness on commercially reasonable or any other terms.
The Surviving Company's pro forma debt obligations subject to floating
interest rates at September 30, 1995, after giving effect to the Merger, will
aggregate approximately $82.4 million at a weighted average interest rate of
approximately 8.266% per annum as compared to $9.8 million at a weighted
average interest rate of approximately 8.065% per annum for Bradley as of
September 30, 1995. To the extent the Surviving Company's exposure to
increases in interest rates is not eliminated through interest rate protection
or cap agreements, such increases will adversely affect the Surviving
Company's FFO and may affect the amount of distributions it can make to its
stockholders.
The foregoing risks associated with the debt obligations of the Surviving
Company may adversely affect the market price of Bradley Common Stock and may
inhibit the Surviving Company's ability to raise capital and issue equity in
both the public and private markets following the consummation of the Merger.
RESTRICTIONS ON ABILITY OF SURVIVING COMPANY TO DISPOSE OF PROPERTIES
COLLATERALIZING THE TUCKER REMIC NOTE OR TO PREPAY THE TUCKER REMIC NOTE
Pursuant to the terms of the Tucker REMIC Indenture, prior to October
1997, principal payments on the Tucker REMIC Note cannot be made and the
properties collateralizing the Tucker REMIC Note cannot be sold. If the
Surviving Company wishes either to prepay all or part of the principal of the
Tucker REMIC Note or to sell any of the properties collateralizing the Tucker
REMIC Note after such date, it will incur significant prepayment penalties.
The prepayment of principal of the Tucker REMIC Note requires an additional
payment of the greater of either (i) 1% of the amount of principal being
prepaid or (ii) the product of (A) the difference between the outstanding
principal balance of the Tucker REMIC Note before prepayment and the present
value of all remaining interest and principal payments thereon and (B) the
amount of principal being prepaid divided by the outstanding principal balance
of the Tucker REMIC Note. After October 1997, in order to release any of the
properties collateralizing the Tucker REMIC Note from the lien so that such
properties may be sold, the Tucker REMIC Indenture requires that certain
additional conditions be met, including that (i) the aggregate amount of
principal repaid on the Tucker REMIC Note equal at least 125% of the amount of
principal allocated to the property to be released and (ii) certain debt
service coverage ratios continue to be satisfied.
20
<PAGE>
REDUCTIONS IN DIVIDENDS PER SHARE FOR TUCKER STOCKHOLDERS FOLLOWING
CONSUMMATION OF THE MERGER
Assuming the Surviving Company continues to make regular quarterly
distributions at Bradley's current rate of $.33 per share following
consummation of the Merger, each Tucker stockholder will receive an equivalent
quarterly dividend payment of $.219 per share (assuming an Exchange Ratio of
.665) or $.226 per share (assuming an Exchange Ratio of .686), as compared to
Tucker's most recent quarterly dividend of $.25 per share.
STOCK PRICE FLUCTUATIONS
The relative stock prices of Bradley Common Stock and Tucker Common Stock
at the Effective Time may vary significantly from the prices as of the date of
execution of the Merger Agreement, the date hereof or the date on which
stockholders vote on the Merger and the Merger Agreement, due to changes in
the business, operations and prospects of Bradley or Tucker, market
assessments of the likelihood that the Merger will be consummated and the
timing thereof, general market and economic conditions and other factors such
as market perception of REIT stocks, retail stocks and REIT retail stocks
generally. There can be no assurance that the price of Bradley Common Stock
will not decline between the date of this Joint Proxy Statement/Prospectus and
the Effective Time.
SHARES AVAILABLE FOR FUTURE SALE COULD ADVERSELY AFFECT PRICE OF BRADLEY
COMMON STOCK
Except for shares issued to affiliates of Tucker, all of the shares of
Bradley Common Stock to be issued to Tucker stockholders in connection with
the Merger (approximately 7,125,941 shares assuming an Exchange Ratio of .665
or 7,170,972 shares assuming an Exchange Ratio of .686) will be freely
transferable. Sales of a substantial number of shares of Bradley Common Stock
by current Tucker stockholders following the consummation of the Merger, or
the perception that such sales could occur, could adversely affect the market
price for shares of Bradley Common Stock after the Merger.
BENEFITS TO CERTAIN TUCKER DIRECTORS AND OFFICERS
In considering the recommendation of the Boards of Directors of Tucker
and Bradley to approve the Merger and the Merger Agreement, stockholders
should be aware that certain members of the management and the Board of
Directors of Tucker have certain interests in, and will receive benefits from,
the Merger that are separate from the interests of, and benefits to,
stockholders of Tucker generally, and which may result in conflicts of
interest with respect to their obligations to Tucker in determining whether it
should consummate the Merger. See "The Merger--Interests of Certain Officers
and Directors of Tucker."
DIFFERENCES BETWEEN RIGHTS OF TUCKER STOCKHOLDERS AND BRADLEY STOCKHOLDERS
The rights of stockholders of Tucker, a Maryland corporation, currently
are governed by Maryland law, the Tucker Charter and the Tucker Bylaws. Upon
completion of the Merger, stockholders of Tucker will become stockholders of
Bradley, a Maryland corporation, and their rights as stockholders of Bradley
will be governed by Maryland law, the Bradley Charter and the Bradley Bylaws.
Certain differences between the rights of stockholders of Tucker and the
rights of stockholders of Bradley include the following: (i) the affirmative
vote of two-thirds of the outstanding shares of Tucker Common Stock is
required to amend the Tucker Charter or to approve a merger, consolidation,
share exchange or sale of all or substantially all of the assets of Tucker,
whereas the affirmative vote of a majority of the outstanding shares of
Bradley Common Stock is required for comparable actions involving Bradley;
(ii) the Bradley Charter provides for three classes of directors, with the
term of office of one class expiring each year, whereas the Tucker Charter
provides that all of its directors are elected each year at the annual meeting
of stockholders; (iii) the holders of not less than 10% of the outstanding
shares of Tucker Common Stock may call a special meeting of Tucker's
stockholders, whereas the holders of not less than 25% of the outstanding
shares of Bradley Common Stock may call a special meeting of Bradley's
stockholders; (iv) the Tucker Board of Directors has exempted certain
transactions from the Maryland business combination statute (including the
Merger), whereas Bradley has not made any such exemptions (except that
Bradley's Board of Directors has exempted the Merger
21
<PAGE>
from such statute); (v) the Bradley Charter generally limits any holder from
acquiring more than 9.8% of the value of all outstanding capital stock of
Bradley while the Tucker Charter generally limits any holder from acquiring
more than 7% of the value of the issued and outstanding stock of Tucker (in
the case of Bradley, this ownership limitation does not apply to shares of
capital stock acquired pursuant to certain all cash tender offers for all of
the outstanding shares of capital stock); and (vi) the holders of Tucker
Common Stock may only amend certain provisions of the Tucker Bylaws, whereas
the holders of Bradley Common Stock may amend any provision of the Bradley
Bylaws. See "Comparison of Stockholder Rights."
SUBSTANTIAL EXPENSES AND PAYMENTS IF MERGER FAILS TO OCCUR
No assurance can be given that the Merger will be consummated. If the
Merger is not consummated, Tucker and Bradley will have incurred substantial
expenses in connection with the transaction. If the Merger Agreement is
terminated under certain circumstances, Tucker shall be required to pay
Bradley the Termination Amount. If the Merger Agreement is terminated in
certain other circumstances, Tucker will be required to reimburse Bradley for
its Expenses. See "The Merger Agreement--Termination Amount and Expenses."
REAL ESTATE INVESTMENT CONSIDERATIONS
General
Real property investments are subject to varying degrees of risk. Real
estate values are affected by a number of factors, including changes in the
general economic climate, local conditions (such as an oversupply of space or
a reduction in demand for real estate in an area), the quality and philosophy
of management, competition from other available space, the ability of the
owner to provide adequate maintenance and insurance and variable operating
costs. Real estate values are also affected by such factors as government
regulations, interest rate levels, the availability of financing and potential
liability due to changes in environmental and other laws. Since substantially
all of Bradley's and Tucker's income has been, and substantially all of the
Surviving Company's income will continue to be, derived from rental income
from retail shopping centers, the Surviving Company's income and distributable
cash flow would be adversely affected if a significant number of the Surviving
Company's tenants were unable to meet their obligations to the Surviving
Company or if the Surviving Company were unable to lease on economically
favorable terms a significant amount of space in its shopping centers. In
addition, in the event of default by a tenant, the Surviving Company may
experience delays and incur substantial costs in enforcing its rights as
landlord.
Illiquidity of Real Estate
Real estate investments are relatively illiquid and therefore will tend
to limit the ability of the Surviving Company to react promptly in response to
changes in economic or other conditions. In addition, the Code places certain
limits on a REIT's ability to sell properties held for fewer than four years,
which may affect the Surviving Company's ability to sell properties without
adversely affecting returns to stockholders.
Dependence on Midwestern Region and Retail Industry
Following the consummation of the Merger, a substantial percentage of the
Surviving Company's properties will be located in the Midwestern region of the
United States and such properties consist predominantly of community shopping
centers. The Surviving Company's performance therefore will be linked to
economic conditions in the Midwest and in the market for retail space
generally. The market for retail space has been adversely affected by the
ongoing consolidation in the retail sector, the adverse financial condition of
certain large companies in this sector and the excess amount of retail space
in certain markets. To the extent that these conditions impact the market
rents for retail space, the cash flow of the Surviving Company could be
negatively impacted.
In addition, the Surviving Company will predominantly own and operate
retail shopping centers catering to retail tenants. To the extent that the
investing public has a negative perception of the retail sector, the value of
shares of common stock of the Surviving Company may be negatively impacted,
thereby resulting in such shares trading at a discount below the inherent
value of the assets of the Surviving Company as a whole.
22
<PAGE>
Bankruptcy and Financial Condition of Tenants
At any time, a tenant of the Surviving Company's properties may seek the
protection of the bankruptcy laws, which could result in the rejection and
termination of the tenant lease. Such an event could cause a reduction of FFO
and thus affect the amount of distributions the Surviving Company can make to
stockholders. No assurance can be given that any present tenant which has
filed for bankruptcy protection will continue making payments under its lease
or that other tenants will not file for bankruptcy protection in the future
or, if any tenants file, that they will continue to make rental payments in a
timely manner. In addition, a tenant may, from time to time, experience a
downturn in its business, which may weaken its financial condition and result
in a reduction or failure to make rental payments when due. If a lessee or
sublessee defaults in its obligations to the Surviving Company, the Surviving
Company may experience delays in enforcing its rights as lessor or sublessor
and may incur substantial costs and experience significant delays associated
with protecting its investment, including costs incurred in renovating and re-
leasing the property.
Potential Negative Effect of One North State Property
On a pro forma basis, for the nine months ended September 30, 1995, $10.6
million or 16% of the total revenue of the Surviving Company is derived from
rents and expense reimbursements from tenants of Tucker's One North State
property, which is a "mixed use" property located in downtown Chicago. The
total charges currently being paid by certain of this property's tenants may
be in excess of current market rates. The leases of these tenants begin to
expire in 2001. One office tenant, however, has the option exercisable on or
before March 31, 1996 to terminate its lease, effective as of April 1, 1998,
upon payment of a $1.8 million cancellation fee. This tenant has indicated
that it will move out of this space prior to the expiration of its lease, but
has not yet determined whether or not it will exercise its early termination
right. Pursuant to the terms of the Tucker REMIC Indenture, this termination
fee is required to be paid into a reserve account which can be used, for among
other things, to pay for tenant alterations, leasing commissions and other
lease inducements directly related to this space. Any unused amount of this
reserve account must be used to repay the principal amounts owed under the
Tucker REMIC Note. The inability of the Surviving Company to lease such
property, or a significant reduction in the amount of rent and expense
reimbursements paid by the tenants of such property, could have an adverse
impact on the operating results of the Surviving Company.
POSSIBLE ENVIRONMENTAL LIABILITIES
Under various federal, state and local laws, ordinances and regulations,
an owner of real estate is liable for the costs of removal or remediation of
certain hazardous or toxic substances on or in such property. Such laws often
impose such liability without regard to whether the owner knew of, or was
responsible for, the presence of such hazardous or toxic substances. The
presence of such substances, or the failure to properly remediate such
substances, may adversely affect the owner's ability to sell or rent such
property or to use such property as collateral in its borrowings. All of the
properties of Tucker and Bradley have been subjected to Phase I or similar
environmental audits (which involve inspection without soil sampling or ground
water analysis) by independent environmental consultants. Except as described
below, these environmental audit reports have not revealed any potential
significant environmental liability, nor is management of Bradley or Tucker
aware of any environmental liability with respect to the properties that such
management believes would have a material adverse effect on the Surviving
Company's business, assets or results of operations. No assurance can be given
that existing environmental studies with respect to the properties reveal all
environmental liabilities or that any prior owner of any such property did not
create any material environmental condition not known to Bradley or Tucker.
Phase II site assessments of Tucker's Commons of Chicago Ridge property
have disclosed the presence of contaminants in fill material and soil at the
property that could be associated with the property's former use as a landfill
and as the former site of an asphalt plant and storage tanks for petroleum
products (which storage tanks have been removed from the property), but not at
such levels as would require reporting to environmental agencies. These Phase
II site assessments also disclosed the presence in the groundwater of
contaminants similar to those detected in the soil samples. Environmental
assessments of the property have also detected methane gas, probably
associated with the former use of the property as a landfill. A regular
maintenance program has been implemented by Tucker to control the migration
and effect of the methane gas. There can
23
<PAGE>
be no assurance that an environmental regulatory agency such as the Illinois
Environmental Protection Agency will not in the future require further
investigation to determine the source and vertical and horizontal extent of
the contamination. If any such investigation is required and confirms the
existence of contaminants at the levels disclosed in the Phase II site
assessments, it is possible that the relevant agency could require the
Surviving Company to take action to address the contamination, which action
could range from ongoing monitoring to remediation of the contamination. No
assurance can be given that the cost of responding to such contamination would
not be material.
In connection with the execution of the Merger Agreement, Bradley, TOP
and, if the Merger is consummated, the Management Directors have agreed to
share the cost of having an outside consultant conduct a new Phase II
investigation of the soil and groundwater of the Commons of Chicago Ridge
property and to prepare a report recommending what actions the Surviving
Company should take with respect to such matters. In the event that Bradley
decides to implement any of the recommendations of such consultant (the
"Recommended Work"), TOP and the Management Directors have each agreed to each
pay fifty percent of the costs of the Recommended Work, with the Management
Directors' aggregate liability for the Recommended Work limited to a maximum
of $200,000. See "The Merger Agreement--Amended TOP Partnership Agreement."
At the time of Tucker's initial public offering, the Management Directors
agreed to indemnify Tucker and TOP against certain potential environmental
liabilities and expenses relating to the Commons of Chicago Ridge property.
These indemnification obligations will be amended in certain respects by the
Amended TOP Partnership Agreement. As amended, the Management Directors
generally have agreed to indemnify the Surviving Company, TOP and its
subsidiaries and affiliates against all claims, losses, costs and expenses
incurred by such parties arising out of any administrative, regulatory or
judicial action, suit, investigation or proceeding in connection with any
applicable environmental health or safety law regarding hazardous substances,
materials, wastes or petroleum products, or any common law right of action
regarding such substances, materials, wastes or products, whether brought by a
governmental or regulatory authority or by a third party, that is initiated on
or before October 4, 2003 with respect to conditions or acts at the Commons of
Chicago Ridge which existed prior to October 4, 1993. In connection with this
indemnification obligation, Bradley has agreed to keep the Management
Directors reasonably informed and to consult with the Management Directors
with respect to any potential claims, settlements and remediation which could
trigger the indemnification obligations of the Management Directors.
The Management Directors' indemnification obligations currently are
secured by the shares of Tucker Common Stock and TOP Units acquired by the
Management Directors in connection with Tucker's initial public offering and,
upon consummation of the Merger, will be secured by the shares of Bradley
Common Stock (into which their respective shares of Tucker Common Stock will
be exchanged) and the TOP Units held or otherwise beneficially owned by each
of the Management Directors and their family members as of the Effective Time.
After the Effective Time, the TOP Units generally will be exchangeable for
cash or shares of Bradley Common Stock (subject to certain rights of Bradley),
and all such shares of Bradley Common Stock may be transferred at any time,
subject to compliance with applicable federal securities laws. Accordingly,
there can be no assurance that the Management Directors will hold any shares
of Bradley Common Stock or TOP Units at the time, if ever, when Bradley
attempts to realize this security interest or that the shares of Bradley
Common Stock or TOP Units held by the Management Directors will be sufficient
to cover their indemnification obligations.
ADVERSE CONSEQUENCES OF FAILURE TO QUALIFY AS A REIT
Bradley (including its predecessor, Bradley Real Estate Trust) believes
that it has operated in a manner that permits it to qualify as a REIT under
the Code for each taxable year since its formation in 1961. Although
management of Bradley believes that Bradley is organized and is operating in
such a manner, no assurance can be given that Bradley will be able to continue
to operate in a manner so as to qualify or remain so qualified. Qualification
as a REIT involves the application of highly technical and complex Code
provisions for which there are only limited judicial or administrative
interpretations and the determination of various factual matters and
circumstances not entirely within Bradley's control. For example, in order to
qualify as a REIT, at least 95% of Bradley's gross income in any year must be
derived from qualifying sources and Bradley must make distributions to
stockholders aggregating annually at least 95% of its REIT taxable income
(excluding net capital
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<PAGE>
gains). In addition, no assurance can be given that new legislation, new
regulations, administrative interpretations or court decisions will not change
the tax laws with respect to qualification as a REIT or the federal income tax
consequences of such qualification. Bradley, however, is not aware of any
currently pending tax legislation that would adversely affect its ability to
continue to operate as a REIT.
If Bradley fails to qualify as a REIT, Bradley will be subject to federal
income tax (including any applicable alternative minimum tax) on its taxable
income at corporate rates. In addition, unless entitled to relief under
certain statutory provisions, Bradley will also be disqualified from treatment
as a REIT for the four taxable years following the year during which
qualification is lost. This treatment would reduce the net earnings of
Bradley available for investment or distribution to stockholders because of
the additional tax liability to Bradley for the year or years involved. In
addition, distributions would no longer be required to be made. To the extent
that distributions to stockholders would have been made in anticipation of
Bradley's qualifying as a REIT, Bradley might be required to borrow funds or
to liquidate certain of its investments to pay the applicable tax. The
failure to qualify as a REIT would also constitute a default under certain
debt obligations of Bradley.
Tucker believes that, since its formation, it has operated so as to
qualify as a REIT under the Code. The failure of Tucker to qualify as a REIT
would have consequences generally similar to the consequences of any failure
by Bradley to qualify as a REIT, as described above. If Tucker has failed to
qualify as a REIT in any year in which it elected so to qualify and
consequently becomes liable to pay taxes as a regular non-REIT corporation,
the liabilities of Tucker that Bradley will assume upon effectiveness of the
Merger will include such tax liability. Moreover, if it were subsequently
determined that Tucker had earnings and profits as determined for federal
income tax purposes (notwithstanding the requirement in the Merger Agreement
that Tucker distribute all earnings and profits prior to the Merger) or if
former stockholders of Tucker acquired 50% or more in value of the shares of
Bradley Common Stock as a result of or following the Merger, Tucker's failure
to qualify as a REIT also could disqualify Bradley as a REIT.
COMPETITION
All of the properties owned by Bradley and by Tucker are located in
developed areas. There are numerous other retail properties and real estate
companies within the market area of each such property which will compete with
the Surviving Company for tenants and development and acquisition
opportunities. The number of competitive retail properties and real estate
companies in such areas could have a material effect on (i) the Surviving
Company's ability to rent space at the properties and the amount of rents
currently charged and (ii) development and acquisition opportunities. The
Surviving Company will compete for tenants and acquisitions with others who
may have greater resources than the Surviving Company.
OWNERSHIP LIMITS
In order to maintain its qualification as a REIT, not more than 50% in
value of the outstanding shares of the Surviving Company may be owned,
directly or indirectly, by five or fewer individuals (as defined in the Code).
To minimize the possibility that Bradley will fail to qualify as a REIT under
this test, the Bradley Charter (which will continue as the charter of the
Surviving Company) authorizes the directors to take such action as may be
required to preserve its qualification as a REIT and generally limits the
ownership of shares of Bradley Common Stock by any particular stockholder to
9.8% of the value of the outstanding shares of Bradley Common Stock. The
Tucker Charter contains comparable ownership limits, which generally prohibit
any particular stockholder from owning more than 7% of the value of the
outstanding shares of Tucker Common Stock. See "Comparison of Stockholder
Rights--Restrictions on the Ownership, Transfer or Issuance of Shares."
The ownership limits in the Bradley Charter, as well as Bradley's
authority to issue preferred stock and other provisions in the Bradley Charter
and the Bradley Bylaws, may delay, defer or prevent a change in control of
Bradley and may also (i) deter certain tender offers for the shares of Bradley
Common Stock, which might be attractive to certain stockholders, or (ii) limit
the opportunity for stockholders to receive a premium for their shares of
Bradley Common Stock that might otherwise exist if an investor were attempting
to assemble a block of shares in excess of 9.8% of the value of the
outstanding shares of Bradley Common Stock, or otherwise
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<PAGE>
effect a change in control of Bradley. No change in the ownership limits of
Bradley Common Stock will be effected as a result of the Merger.
DISSENTERS' RIGHTS
Under the MGCL, stockholders of Bradley and Tucker do not have
dissenters' rights in connection with the Merger.
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<PAGE>
THE COMPANIES
BRADLEY
Bradley is one of the nation's oldest continuously qualified REITs under
the Code. Originally organized in 1961 as a Massachusetts business trust under
the name Bradley Real Estate Trust, Bradley was reorganized as a Maryland
corporation in October 1994. Bradley focuses on the ownership and operation of
community shopping centers, primarily in the Midwestern and the Northeastern
regions of the United States. Bradley's objective is to enhance the operating
performance and value of its portfolio through renovation, expansion and
leasing strategies designed to meet the needs of an evolving retail
marketplace. Bradley also seeks to create value through the acquisition of
properties which can benefit from Bradley's expertise in shopping center
management, renovation and expansion. Bradley currently owns fifteen shopping
centers, one retail/office building and the land under a retail/office tower.
In total, Bradley's existing properties encompass approximately 3.1 million
rentable square feet (of which approximately 3.0 million square feet is
rentable retail space), leased to over 300 tenants. Bradley's existing
portfolio was 94% leased as of September 30, 1995.
TUCKER
Tucker is a leader in the Midwest in the development, acquisition and
long-term ownership of community shopping centers. Headquartered in
Northbrook, Illinois, Tucker owns and manages more than 4.3 million square
feet of income-producing properties. The properties are located primarily in
Chicago and other areas of the Midwest, with tenants primarily selling value-
oriented merchandise.
Tucker is a Maryland corporation, formed on May 28, 1993, which elected
to qualify as a REIT under the Code following the public offering of Tucker
Common Stock in October 1993. Tucker is a fully integrated real estate
management and development company and was established to continue the
business of the Predecessor Business as an owner, manager and developer of
shopping centers. TTC was founded in 1976 by Kenneth L. Tucker. Prior to their
acquisition by Tucker, nine of the properties owned or controlled by Tucker
were owned by entities in which principals of TTC had substantial interests.
All of Tucker's real estate properties are held by, and all of its
operations are conducted through, TOP and its subsidiaries. TOP was formed
for the purpose of acquiring, operating and expanding the business of Tucker
and certain of its affiliates. Tucker is the sole general partner of TOP and
owns 95.9% of the outstanding TOP Units. The limited partners of TOP,
including the Management Directors, were equity holders of the entities which
previously owned the properties transferred to TOP in connection with Tucker's
initial public offering in October 1993. The TOP Units are exchangeable,
subject to certain limitations imposed to protect Tucker's status as a REIT,
into shares of Tucker Common Stock on the basis of one TOP Unit for one share
of Tucker Common Stock.
TFP, which owns six of the Tucker properties, was created to facilitate
the refinancing of indebtedness encumbering certain of the Tucker properties
through a loan to TFP from a trust qualifying as a REMIC for federal income
tax purposes. TOP is the 99% general partner of TFP, and TFC, a wholly-owned
subsidiary of Tucker, is the 1% general partner of TFP. Upon completion of
Tucker's initial public offering, TFP issued mortgage notes in an aggregate
principal amount of $100,000,000 (the "Original Mortgage Notes") to finance
these six properties. Net proceeds to Tucker from this issuance were
approximately $97,400,000. In June 1994, TFP exchanged the Original Mortgage
Notes for the Tucker REMIC Note which was issued pursuant to the Tucker REMIC
Indenture. At the same time, Kidder, Peabody Acceptance Corporation I sold six
classes of pass-through certificates evidencing the entire beneficial
ownership of interest of the Tucker REMIC, a trust consisting solely of the
Tucker REMIC Note and related instruments evidencing the Tucker REMIC's
security interest in the related collateral. The Tucker REMIC Note matures in
one balloon payment in September 2000 and bears interest at a fixed-rate of
7.3% per annum, with monthly interest-only payments required. The Tucker REMIC
Note is recourse only to the assets of TFP and is collateralized by first
mortgage liens on each of the properties owned by TFP (Commons of Crystal
Lake, Heritage Square, Sheridan Village, Speedway SuperCenter, Washington
Lawndale Commons and One North State) and by an assignment of all of the TFP's
interest in the rents and the leases at each of these properties.
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<PAGE>
SURVIVING COMPANY
Following the consummation of the Merger, the Surviving Company will be
one of the leading owners and operators of community shopping centers in the
Midwestern region of the United States; it will own 31 community shopping
centers encompassing approximately 7.3 million square feet of rentable retail
space in eleven states. Set forth below is a property chart which contains
certain information concerning the shopping centers to be owned by the
Surviving Company following the consummation of the Merger. Properties
indicated by an asterisk (*) are currently owned by the Tucker entity
identified in the applicable footnote.
<TABLE>
<CAPTION>
Year Rentable Percent Leased at Square Base Lease/Option
Shopping Centers Acquired Square Feet Sept. 30, 1995 Major Tenants(1) Feet Expiration Date
- ---------------- -------- ----------- ----------------- ---------------- ------ -----------------
<S> <C> <C> <C> <C> <C> <C>
ILLINOIS
Rivercrest Center 1994 429,000 100% OMNI Foods 87,937 2011/2031
Crestwood, Illinois Venture 79,903 2012/2032
Sears Roebuck and Co. 55,000 2001/2011
T.J. Maxx 34,425 2004/2019
PETsMART 31,639 2009/2030
Best Buy 25,000 2008/2023
OfficeMax 24,000 2007/2017
Hollywood Park 15,000 2000/2005
Westview Center 1993 326,000 78% Cub Foods 67,163 2009/2029
Hanover Park, Illinois Marshalls 34,302 2004/2019
Crossroads Center 1992 242,000 94% K-Mart (ground lease) 96,268 2001/2020
Fairview Heights, Illinois T.J. Maxx 25,200 1998/2013
/*/Commons of Chicago
Ridge(3) 1993(2) 286,000 79% T.J. Maxx 25,082 1998/2008
Chicago Ridge, Illinois Marshalls 27,000 1999/2014
Office Depot 27,680 2002/2012
Cineplex Odeon 25,000 2008/2018
Michaels Stores 17,550 1999/2004
/*/Chicago Ridge Annex(3) 1995 41,854 53% Pep Boys 22,354 2015/2035
Chicago Ridge, Illinois
/*/Commons of Crystal
Lake(4) 1993(2) 355,000 98% Jewel/Osco 59,804 2007/2042
Crystal Lake, Illinois Handy Andy 68,800 2018
Venture 81,338 2006
(not owned)
/*/Heritage Square(4) 1993(2) 212,000 100% Montgomery Ward 111,016 2013/2033
Naperville, Illinois Circuit City 28,351 2009/2024
Stroud's 26,703 2003/2013
/*/Meadows Town Mall 1993(2) 382,000 83% T.J. Maxx 24,000 1999/2009
Rolling Meadows, Illinois Waccamaw 108,000 1999/2009
Elek-Tek 32,000 2001/2011
Women's Club 20,478 1998/2008
F&M Distributors 21,980 2005/2020
/*/Sheridan Village(4) 1993(2) 301,000 96% Bergner's Dept. Store 162,852 2006/2021
Peoria, Illinois Cohen Furniture 16,600 2007
/*/High Point Centre(3) 1993(2) 240,000 93% Cub Foods 62,000 2008/2033
Lombard, Illinois T.J. Maxx 25,200 1998/2013
Office Depot 36,416 2003/2013
Macfrugal's 17,040 2006/2016
/*/Rollins Crossing(3) 1995 255,000 100% Sears Hardware 21,083 2005/2020
Round Lake Beach, Illinois Super K-Mart 190,000 2033
(not owned)
MINNESOTA
Har Mar Mall 1992 397,000 91% HomePlace 54,500 2011/2026
Roseville, Minnesota Barnes & Noble 44,856 2010/2025
Marshalls 34,858 1998/2013
T.J. Maxx 25,025 1998/2008
General Cinema 22,252 2001/2021
General Cinema 19,950 2000/2010
Michaels Stores 17,907 2003/2018
</TABLE>
28
<PAGE>
<TABLE>
<CAPTION>
Year Rentable Percent Leased at Square Base Lease/Option
Shopping Centers Acquired Square Feet Sept. 30, 1995 Major Tenants(1) Feet Expiration Date
- ---------------- -------- ----------- ----------------- ---------------- ------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Sun Ray Shopping Center 1961 254,000 94% J.C. Penney 40,451 1999/2009
St. Paul, Minnesota Marshalls 26,256 2005/2020
T.J. Maxx 23,955 2000/2005
Kowalski's 23,218 2000/2010
Michaels Stores 18,127 2004/2019
Richfield Hub Shopping
Center 1988 138,000 97% Marshalls 26,785 2003/2008
Richfield, Minnesota Michaels Stores 24,235 1999/2014
Hub West Shopping Center 1991 77,000 100% Rainbow Foods 50,817 2012/2017
Richfield, Minnesota U.S. Swim & Fitness 26,185 2001/2003
White Bear Hills 1993 67,000 100% Gateway Foods 45,679 2011/2021
White Bear Lake, Minnesota
Terrace Mall 1993 140,000 92% Rainbow Foods 59,232 2013/2033
Robbinsdale, Minnesota North Memorial 32,000 1999/2004
Burning Tree Plaza 1993 110,000 97% T.J. Maxx 30,000 2004/2019
Duluth, Minnesota Best Buy 28,000 1999/2014
Northwest Fabrics 17,682 1999/2004
Westwind Plaza 1994 88,000 95% Northern Hydraulics 18,165 2002/2012
Minnetonka, Minnesota
INDIANA
/*/Speedway Supercenter(4) 1993(2) 530,000 95% Kohl's 75,000 1999/2019
Speedway, Indiana Kroger 59,515 2013/2043
Sears Roebuck and Co. 30,825 2004/2024
Old Navy 15,000 2005/2010
Kittles 25,320 2000/2010
PETsMART 21,781 2002/2012
Factory Card Outlet 16,675 2003/2013
Lindo Super Spa 16,859 2000/2010
/*/The Village(3) 1993(2) 355,000 97% J.C. Penney 60,600 1999/2004
Gary, Indiana Goldblatt's 55,000 2000/2005
McCrory's 24,500 1998/2003
Jacobsens 22,896 1996
Post-Tribune
Publishing 19,246 1996
Indiana Employment 18,050 1996/2000
/*/Washington Lawndale
Commons(4) 1993(2) 333,000 99% Target 83,110 2005/2025
Evansville, Indiana Sears Homelife 34,527 2003/2018
Allied Sporting Goods 20,285 1997/2012
Kuester's 40,857 1996
Jo-Ann Fabrics 15,262 2003/2013
Books-A-Million 20,515 2002/2008
TENNESSEE
/*/Williamson Square(5) 1993(2) 335,000 95% Wal-Mart 117,493 2008/2038
Franklin, Tennessee Kroger 63,986 2008/2038
Carmike Cinemas 29,000 2008/2018
Franklin Micro System 18,595 2005
WISCONSIN
/*/Mequon Pavilion(3) 1994 212,000 96% Kohl's Food Emporium 45,697 2010/2050
Furniture Clearance 19,900 1997
KENTUCKY
/*/StonyBrook(3) 1993(2) 136,000 97% Kroger 79,625 2021/2046
MISSOURI
Grandview Plaza 1971 314,000 98% Home Quarters 84,611 2013/2033
Florissant, Missouri Schnucks 68,025 2011/2026
Walgreens 15,984 2043
J.C. Penney 63,892 1996
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Year Rentable Percent Leased at Square Base Lease/Option
Shopping Centers Acquired Square Feet Sept. 30, 1995 Major Tenants(1) Feet Expiration Date
- ---------------- -------- ----------- ----------------- ---------------- ------ -----------------
<S> <C> <C> <C> <C> <C> <C>
NEW HAMPSHIRE
Hood Commons 1973 216,000 97% Shaw's 58,258 2013/2033
Derry, New Hampshire Ames 50,000 2000/2005
Decelle 26,653 1999/2014
MAINE
Augusta Plaza 1971 152,000 89% K-Mart 85,808 1997/2012
Augusta, Maine
NEW MEXICO
St. Francis Plaza 1995 30,000 100% Walgreens 14,950 2043
Santa Fe, New Mexico Wild Oats 14,850 2006/2066
RETAIL/OFFICE BUILDINGS
*One North State(4) 1993(2) 640,000 95% First Chicago 296,782 2003
Chicago, Illinois Arthur Andersen 126,533 2003/2013(6)
T.J. Maxx 77,675 2001/2011
Filene's Basement 50,000 2002/2012
Int'l. Academy of 27,270 2003/2008
Merchants
585 Boylston Street 1961 22,000 98% CVS Pharmacy 7,582 2001/2016
Boston, Massachusetts Various Office Tenants 13,589 Varies
GROUND LEASE
501-629 Nicollet Avenue 1969 51,000 100% Brookfield 51,000 2086
Minneapolis, Minnesota
</TABLE>
______________
(1) Major tenants are defined as tenants occupying 15,000 square feet or more
of the rentable square footage with the exception of 585 Boylston Street
and St. Francis Plaza. In some cases, the named tenant occupies the
premises as a sublessee. Bradley views "anchor" tenants as a subset of
the major tenants at each property, generally consisting of those tenants
which also represent more than 15% of the property's rentable square
footage.
(2) For all properties acquired by Tucker in connection with its initial
public offering, the year of acquisition is deemed to be 1993 (the year
in which such offering occurred) even if such property was previously
owned by the Predecessor Business.
(3) Currently owned by TOP.
(4) Currently owned by TFP.
(5) Currently owned by Williamson Square Associates Limited Partnership, of
which TOP is the 60% general partner.
(6) This tenant has the option exercisable on or before March 31, 1996 to
terminate its lease, effective as of April 1, 1998, upon payment of a
$1.8 million cancellation fee. This tenant has indicated that it will
move out of its space prior to the expiration of its lease, but has not
yet determined whether or not it will exercise its early termination
right. See "Risk Factors--Real Estate Investment Considerations."
The current executive officers and directors of Bradley will manage the
business and affairs of the Surviving Company following the consummation of
the Merger. For information concerning these persons, see "Management of the
Surviving Company." Following the Merger, the Surviving Company will employ
most of Tucker's property management personnel. Given the strength of
Tucker's property-level operational personnel and systems, Bradley's
management believes the Merger will broaden its existing property management
capabilities and allow the Surviving Company to internalize its property
management and leasing functions.
Bradley is currently in discussions with the lead lender under its
existing $65 million secured revolving credit facility regarding replacing
this facility with a $150 million unsecured revolving credit facility. Bradley
anticipates that the new credit facility will be available for the
acquisition, development, renovation and expansion of new and existing
properties (including, but not limited to, capital improvements, tenant
improvements, and leasing commissions), and other working capital purposes. It
is anticipated that the interest rates available under the new credit facility
will be more favorable than those currently available under Bradley's existing
secured credit facility and may become even more favorable in the event the
Surviving Company (x) meets certain loan to value tests or (y) receives an
investment grade unsecured debt rating.
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<PAGE>
Bradley anticipates that the new credit facility will contain financial and
other covenants which are consistent with similar unsecured lines of credit
for comparable publicly-traded REITs. Bradley believes that the increased
size, lower interest rate and unsecured nature of the new credit facility will
increase the Surviving Company's financial flexibility and prospects for
obtaining an investment grade debt rating. It is currently contemplated that
the new credit facility will become effective simultaneously with the closing
of the Merger. While discussions regarding a new credit facility are ongoing,
there can be no assurance that such a credit facility will be obtained, or if
obtained, when it will become effective or become available. If this new
credit facility cannot be obtained, consent to the Merger would be required
from the existing revolving credit lenders to Bradley and Tucker and an
extension of the Tucker credit agreement would be required. See "The Merger
Agreement--Conditions to the Merger."
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<PAGE>
THE MERGER
TERMS OF THE MERGER
The Boards of Directors of each of Bradley and Tucker have approved the
Merger and the Merger Agreement, a copy of which is attached hereto as Annex
A, pursuant to which, upon fulfillment (or waiver) of the conditions set forth
therein, (i) Tucker will be merged with and into Bradley, with Bradley being
the Surviving Company in the Merger, and (ii) each issued and outstanding
share of Tucker Common Stock will be converted into the right to receive a
percentage of a share of Bradley Common Stock to be determined as follows. If
the Closing Price of Bradley Common Stock is $16.00 or more, each share of
Tucker Common Stock will be exchanged for .665 of a share of Bradley Common
Stock. If the Closing Price is between $15.50 and $16.00, the Exchange Ratio
will be determined by dividing $10.64 by the Closing Price. If the Closing
Price is $15.50 or less, the Exchange Ratio will be .686 of a share of Bradley
Common Stock. The Closing Price for Bradley Common Stock for the 20 trading
days ended January __, 1996 was $_______.
As a result of the Merger and without any action on the part of the
holder thereof, at the Effective Time, all shares of Tucker Common Stock will
cease to be outstanding, will be canceled and retired and will cease to exist.
Each holder of a Certificate will thereafter cease to have any rights with
respect to such shares of Tucker Common Stock, except the right to receive
shares of Bradley Common Stock and cash in lieu of fractional shares of
Bradley Common Stock upon the surrender of such Certificate. Promptly after
the Effective Time, the Exchange Agent will mail a letter of transmittal and
instructions to each holder of a Certificate as of the Effective Time for use
in effecting the surrender of the Certificate in exchange for certificates
representing shares of Bradley Common Stock and cash in lieu of fractional
shares. See "The Merger Agreement--Exchange of Tucker Stock Certificates."
BACKGROUND OF THE MERGER
In early October 1994, Kenneth L. Tucker, President of Tucker, contacted
E. Lawrence Miller, President of Bradley, concerning a possible business
combination between the two companies. Preliminary discussions concerning a
possible merger continued between the members of senior management of both
companies during October and November 1994. On November 16, 1994, the parties
executed a mutual confidentiality agreement which provided that each party
would not disclose and would keep confidential all non-public due diligence
materials provided to it by the other party. In early December 1994,
discussions between the parties terminated before they reached a substantive
stage and before the exchange of any non-public due diligence materials.
On December 15, 1994, the Tucker Board of Directors announced a reduction
in its quarterly dividend payment from $.38 to $.36 per share. This dividend
reduction was the result of several factors, including higher interest rates,
higher than anticipated general and administrative expenses and lower than
anticipated fee income from third-party property management and leasing.
In December 1994, following the reduction of the quarterly dividend and
the termination of its negotiations with Bradley, Tucker entered into
discussions on an exclusive basis with another public company concerning a
possible business combination. On January 31, 1995, the Tucker Board
authorized the engagement of, and on February 17, 1995, Tucker formally
engaged, PaineWebber to provide investment banking advice in connection with a
possible business combination involving this company or any other publicly-
traded real estate company. In addition, on January 31, 1995, the Tucker Board
also authorized the engagement of Richard S. Ellwood & Co. as a consultant to
advise Tucker during its investigation and consideration of strategic
alternatives. In late March 1995, the negotiations with this public company
terminated.
On March 1, 1995, Tucker announced that its FFO for the quarter ended
December 31, 1994 was $.35 per share (compared to $.44 per share for the
previous quarter) and that it had failed to meet its overall FFO goals for
fiscal 1994. Due to the announced reduction in FFO, Tucker's high leverage
and the decrease in Tucker's stock price over the previous several months,
Tucker's ability to raise capital in the public markets on acceptable terms
was limited.
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<PAGE>
Following this announcement and the termination of discussions with the
other public company in late March, the Board of Directors of Tucker directed
its management, with the assistance of PaineWebber, to prepare a Confidential
Information Memorandum for distribution to a select group of publicly-traded
REITs, including Bradley. In connection with this distribution, these
companies were asked to submit indications of interest concerning a possible
business combination with Tucker by May 26, 1995. During this period, Tucker
also engaged Kemper Securities, Inc. to explore a possible business
combination with a privately-held real estate company.
On May 26, 1995, Bradley indicated its interest in pursuing a transaction
in which each outstanding share of Tucker Common Stock would be exchanged for
.828 of a share of Bradley Common Stock (with increases or decreases in the
exchange ratio to assure that Tucker's stockholders would receive Bradley
Common Stock having a market value not less than $12.25 and not greater than
$13.25), subject to Bradley's due diligence and to certain other conditions.
Tucker also received indications of interest at lower indicated values from
two other publicly-traded REITs. Based on this review, the Tucker Board
concluded that Bradley's indication of interest was the most favorable and
authorized negotiations with Bradley in an effort to increase Bradley's
indicated price and to remove the conditions to Bradley's indication of
interest. Bradley refused to increase its indicated price or to remove any
condition, and the negotiations between Bradley and Tucker terminated on June
8, 1995.
On June 15, 1995, Tucker publicly announced that it was reducing its
quarterly dividend from $.36 to $.25 per share, and that it had hired
PaineWebber to help it explore strategic alternatives to maximize stockholder
value. On the date of the announcement, Tucker's stock price decreased by
$2.12 per share. As a result of this announcement, several companies
expressed interest in a transaction with Tucker. As part of its solicitation
process, Tucker delivered the Confidential Information Memorandum (and other
due diligence materials) to certain of these parties. Tucker requested that
these parties, along with Bradley and the private real estate company with
whom Kemper Securities, Inc. was exploring a possible business combination,
submit indications of interest by July 14, 1995. The Tucker Board understood
that the selected bidder or bidders would perform additional due diligence
before signing a definitive merger agreement.
Five indications of interest were received on or prior to July 14, 1995,
including one indication of interest from a public REIT which had not
previously received Tucker's Confidential Information Memorandum. These
indications of interest consisted of two proposals by private real estate
companies for cash acquisitions of Tucker and two proposals from public REITs
(including Bradley) for stock-for-stock acquisitions of Tucker, and one
additional proposal from a public REIT (the "Alternative REIT Acquiror"),
which proposed consideration in cash or stock, at Tucker's option. All of the
proposals were conditioned on the acquiring party having the right to conduct
extensive additional due diligence and to negotiate exclusively with Tucker
for at least 30 days. The two cash proposals from private real estate
companies were conditioned on the bidders obtaining financing for the
acquisition.
In its bid, Bradley proposed a transaction in which each outstanding
share of Tucker Common Stock would be converted into the right to receive
between .79 and .83 of a share of Bradley Common Stock depending on the
trading price of Bradley Common Stock during the ten trading days preceding
the closing of this transaction. As a condition to proceeding with a potential
transaction, Bradley insisted that Tucker sign an agreement which (a)
generally would restrict Tucker from conducting discussions or negotiations
with any other party for 30 days; and (b) would require Tucker to reimburse
Bradley for its out-of-pocket expenses (up to a maximum of $325,000) in the
event that (i) Tucker wished to pursue an acquisition proposal with another
party, or (ii) Bradley decided not to enter into a definitive merger agreement
because, in the course of its due diligence, Bradley discovered that the
Confidential Information Memorandum contained false or misleading information
or that the operations of Tucker deviated materially from the information
presented in the Confidential Information Memorandum. Bradley's indication of
interest also provided that it would expire on July 21, 1995.
On July 17 and 18, 1995, the Tucker Board met to review the indications
of interest. The high end of the range of values of all but one of the other
offers received by Tucker offered greater consideration to Tucker's
stockholders than the Bradley offer. The two cash bids from the privately-held
real estate companies, on their face, purported to offer the highest potential
acquisition prices. Both such cash bids, however, were subject to financing
conditions. The Board sought information on the firmness of these parties'
financing
33
<PAGE>
arrangements and the likelihood that they ultimately would be able to finance
a transaction with Tucker. The Board rejected one cash offer after management
informed them that the bidder intended to finance the transaction through a
private placement of equity, that the success of such a private placement
could not be assured and, if successful, could not be completed for
approximately four months. PaineWebber expressed reservations, based on its
knowledge of the market for such securities, about the likelihood of success
of such a private placement. With regard to the remaining privately-held cash
bidder, management advised the Board that, to date, this bidder did not have
firm financing commitments and had not been able to provide management or
PaineWebber with any assurance as to when such commitments could be obtained
(if at all). After considering the foregoing, the Board requested that
management and PaineWebber attempt to have this bidder accelerate its due
diligence activities and provide additional information to the Board by July
24, 1995 concerning its respective ability to obtain financing.
In its consideration of the three acquisition proposals from publicly-
traded REITs, the Tucker Board noted that one party had submitted its proposal
without reviewing any of Tucker's confidential material, and thus its bid was
likely to be reduced during the due diligence process. PaineWebber informed
the Board that while this company primarily owned retail properties, a
significant portion of such properties were not shopping centers. PaineWebber
also informed the Board that this company was highly leveraged, its stock
traded at a relatively low multiple and thus it had a high implicit cost of
funds. Because this company was proposing a stock-for-stock merger, the Tucker
Board realized that the combined company would also be highly leveraged and
would thus potentially face many of the same issues as Tucker did with respect
to accessing the capital markets. Therefore, the stock of the combined company
following the merger was likely not to be viewed as favorably as Bradley's
stock by Tucker's stockholders. Thus, after consultation with PaineWebber, the
Board concluded that it was unlikely that this company would ultimately enter
into an acquisition agreement which was in the best interests of Tucker's
stockholders. The Tucker Board noted that, while the upper range of the bid
submitted by the Alternative REIT Acquiror was approximately equal in market
value to Bradley's bid, the range presented by the Alternative REIT Acquiror
was substantial. The Alternative REIT Acquiror indicated that it would value
the transaction strictly as an asset purchase (i.e., without premium to
stockholders resulting from any "franchise value") and that it would take
approximately three weeks to make a more definitive offer. Thus, the Board
concluded that the Alternative REIT Acquiror was likely to reduce its bid
during the due diligence process.
In considering Bradley's indication of interest at its July 17th and 18th
meetings, the Board noted that Bradley had recently completed a public
offering of its common stock and had a debt to Total Market Capitalization
ratio of approximately 16%. PaineWebber informed the Board that Bradley has a
quality institutional investor base and relatively high FFO multiple compared
to other retail REITs of Bradley's size. The Board also noted that the two
companies are of similar size and have similar properties located primarily in
the Midwest. The Board also believed that, given the similarities between the
two companies, the Merger would provide the Surviving Company with substantial
potential savings in general and administrative expenses and opportunities for
synergies through the potential enhancement of its property level operational
systems. Thus, the Board believed that a stock-for-stock transaction with
Bradley would be a strategic combination rather than a mere sale of Tucker and
thus provided greater potential value for Tucker's stockholders.
In its deliberations, the Board considered the possibility of giving all
of the parties additional time to complete their due diligence and to allow
them to submit firm bids which were not subject to either financing or due
diligence conditions. The Board believed that Bradley would continue to
participate in the bidding process for an additional week or so while the
Board was evaluating and negotiating these bids. However, the Board believed
that it was unlikely that Bradley would participate in yet another bidding
process for Tucker or devote any further significant time, effort or expense
to a transaction with Tucker without an exclusivity agreement. Thus, the Board
authorized PaineWebber and management to continue discussions with Bradley
concerning the terms of its bid and to attempt to have the privately-held cash
bidder and the Alternative REIT Acquiror accelerate their respective due
diligence activities and solidify their financing arrangements.
The Tucker Board met by telephone on July 21, 1995 to receive an update
on the status of negotiations with the various parties. In this meeting,
management reported that the remaining privately-held cash bidder had
indicated to Tucker that it needed additional time to complete its due
diligence and based on issues raised in its evaluation to date, its
acquisition price would be at or below the low end of the range specified in
its
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original bid. Further, although this cash bidder indicated that it believed
its proposed financing sources ultimately would be willing to provide debt and
equity financing for the transaction, it appeared that no meaningful progress
had been made with respect to obtaining firm financing commitments.
PaineWebber reported to the Board that the Alternative REIT Acquiror had not
made a more definitive proposal. As a result of these discussions, Tucker's
Board approved further negotiations with Bradley concerning a business
combination on the terms of Bradley's indication of interest and authorized
the execution of an exclusivity agreement with Bradley for a period of 30
days. Tucker and Bradley executed this agreement on July 25, 1995 (the
"Exclusivity Agreement").
Following July 25, 1995, the senior management of Bradley conducted due
diligence concerning Tucker and its properties. As a result of such due
diligence, on August 7, 1995, Bradley informed Tucker that it would only
proceed with a transaction pursuant to which each share of Tucker Common Stock
would be exchanged for .717 of a share of Bradley Common Stock. Bradley also
requested an extension of the time period under the Exclusivity Agreement in
order to continue its due diligence. On August 9, 1995, the Tucker Board met
to discuss the revised Bradley offer. PaineWebber contacted two specific
former bidders, including the Alternative REIT Acquiror, and neither indicated
any desire to make a more favorable bid. The Board considered the proposal
previously made by the Alternative REIT Acquiror, but concluded that, given
the opportunity to conduct extensive additional due diligence (as Bradley had
conducted), the Alternative REIT Acquiror was likely to reduce its offer to a
price no greater (and potentially lower) than Bradley was currently proposing.
Further, a refusal to extend the Exclusivity Agreement would likely result in
the termination by Bradley of its discussions with Tucker. The Board
concluded that it would not be useful to approach any of the privately-held
real estate companies that previously had proposed cash acquisitions of Tucker
because they would still have to obtain financing for a transaction and their
ability to raise such financing was uncertain. The Board decided that, in the
absence of another offer which would result in a higher value for Tucker's
stockholders, Tucker would continue discussions with Bradley and agree to an
extension of the Exclusivity Agreement. On August 24, 1995, after
negotiations between the parties, Bradley and Tucker executed an amendment to
the Exclusivity Agreement which provided, among other things, that the parties
would continue good faith negotiations concerning a business combination on
the terms of the revised Bradley offer and extend the exclusive negotiation
period through September 30, 1995.
In its deliberations, the Tucker Board noted that the Management
Directors might have conflicts of interest in addressing potential employment
or severance arrangements. The Tucker Board also noted that the Management
Directors have substantial equity interests in Tucker and TOP. The Tucker
Board determined that any arrangements involving the Management Directors
which were not part of the consideration to all stockholders would require the
approval of the other Directors who did not have a financial interest in such
arrangements. The Board designated Messrs. Hart, Homer, Masotti and Smith as a
special committee (the "Tucker Special Committee") to evaluate and negotiate
on behalf of Tucker any compensation, severance and other arrangements or
transactions involving the Management Directors. In September 1995, the Tucker
Board approved the engagement by the Tucker Special Committee of the law firm
of Rudnick & Wolfe as independent counsel to the Tucker Special Committee.
Following the execution of the amendment to the Exclusivity Agreement,
Bradley, Tucker and their respective representatives conducted extensive due
diligence on each other and began work on definitive documentation for the
transaction. On September 11, 1995, Bradley and Tucker issued a joint press
release indicating that the parties were involved in negotiations concerning a
possible business combination. On September 14, 1995, Bradley's attorneys
circulated to all parties the initial drafts of a proposed Merger Agreement
and the proposed Amended TOP Partnership Agreement.
In early September 1995, Bradley engaged Alex. Brown to provide
investment banking advice in connection with the proposed Tucker transaction
and, if requested, to render a fairness opinion with respect to such
transaction. Alex. Brown and Bradley subsequently executed a formal engagement
letter concerning such activities on September 15, 1995. Following its
engagement, Alex. Brown and senior management of Bradley conducted additional
financial due diligence concerning Tucker and its properties. As a result of
this financial due diligence, on September 22, 1995, Bradley informed
PaineWebber that it would only proceed with a transaction in which each share
of Tucker Common Stock would be converted into the right to receive .646 of a
share of Bradley Common Stock. On September 22, 1995, during a telephonic
meeting of the Tucker Special
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Committee, PaineWebber informed the Special Committee of the revised Bradley
exchange ratio proposal and that Bradley had said that the revision was due to
significant concerns with respect to specific properties. Although the Tucker
Special Committee did not take any formal action with respect to the revised
exchange ratio, the consensus of the Tucker Special Committee was that an
exchange ratio of .646 was inadequate, and that PaineWebber should continue
negotiating with Bradley through the upcoming weekend to increase the exchange
ratio. Extensive negotiations concerning the proposed exchange ratio then
continued between PaineWebber and Bradley. As a result of these negotiations,
Bradley agreed to increase its exchange ratio so that each share of Tucker
Common Stock would be converted into the right to receive .665 of a share of
Bradley Common Stock. Bradley also agreed that (i) if the Closing Price of
Bradley Common Stock was between $15.50 and $16.00, the exchange ratio would
be determined by dividing $10.64 by the Closing Price, and (ii) if the Closing
Price of a share of Bradley Common Stock was $15.50 or less, the exchange
ratio would then be .686 of a share of Bradley Common Stock. In connection
with making this proposal, Bradley also demanded an extension of the period
under the Exclusivity Agreement.
On September 25, 1995, the Tucker Special Committee and Kenneth Tucker
held a telephonic meeting with PaineWebber to review, among other things, the
status of negotiations with Bradley. PaineWebber informed those participating
in the meeting of the revised proposal which arose from the weekend's
negotiations and that Bradley had scheduled a meeting of the Bradley Board of
Directors for the following day at which the Bradley Board would be asked to
consider the terms of the revised proposal. Because the entire Tucker Board of
Directors was not present, the members of the Tucker Board present did not
take any action with respect to the transaction or the exchange ratio. The
consensus of the Tucker Board members present was that there were no other
alternatives available to Tucker that were likely to be more favorable and
that PaineWebber should not communicate anything to Bradley which would
discourage its Board from considering the revised proposal. PaineWebber
thereafter informed Bradley that, because the Tucker Board had not yet acted,
PaineWebber could not assure Bradley that the revised terms would be
acceptable. However, PaineWebber believed that, based on its discussions to
date with the Tucker directors present at such meeting, there was a likelihood
that the Tucker Board of Directors would approve the revised terms of the
transaction.
On September 26, 1995, the Board of Directors of Bradley met to consider
the proposed transaction with Tucker. At this meeting, Bradley's senior
management, together with its legal and financial advisors, reviewed with the
Board of Directors, among other things, the background of the proposed merger,
the strategic rationale for, and the potential risks and benefits of, the
proposed merger, a summary of due diligence findings, financial and valuation
analyses of the transaction and the terms of the proposed merger agreement.
Alex. Brown also made a presentation to the Board concerning its financial
analyses of the proposed transaction and stated that it believed it would be
able to provide a fairness opinion on the proposed exchange ratio, based upon
the transaction as then negotiated and upon the facts and circumstances as
they existed at the time, subject to certain assumptions, factors and
limitations.
On October 3, 1995, the Tucker Board met to discuss the new proposal and
to decide whether or not to proceed with the transaction with Bradley.
PaineWebber made a presentation at this meeting concerning the feasibility of
reviving negotiations with previous suitors. PaineWebber reported that it had
contacted the Alternative REIT Acquiror who did not indicate an interest in
resuming discussions. PaineWebber also reported to the Tucker Board that it
believed Bradley would terminate discussions with Tucker if Tucker refused to
sign the extension to the Exclusivity Agreement. The Tucker Board also
concluded that it would not be useful to approach any of the cash bidders
because such persons would still need to raise financing for a transaction.
Therefore, the Board determined that because there was no other firm
transaction which could provide greater value to its stockholders, it was too
risky to take a chance of losing the Bradley transaction. As a result, on
October 3, 1995, the parties executed a second amendment to the Exclusivity
Agreement which extended the exclusive negotiation period to October 31, 1995.
Immediately after the Tucker Board meeting on October 3, 1995, and at
subsequent meetings on October 12 and October 23, 1995, the Tucker Special
Committee met to discuss the severance arrangements and other compensation
arrangements for the Management Directors as well as for the employees of
Tucker generally. The Tucker Special Committee approved a general policy for
Tucker employees of severance pay equal to six weeks' base salary plus two
weeks' base salary for each full year of regular full-time employment; this
policy was adopted for all officers and employees, except for William Karnes,
who had an existing
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employment agreement, and Kenneth Tucker, for whom the Tucker Special
Committee approved an aggregate severance payment of $225,000. In addition,
the Tucker Special Committee approved the terms of a proposed consulting
agreement between Bradley and Kenneth Tucker. See "The Merger--Interests of
Certain Officers and Directors of Tucker." The Tucker Special Committee also
approved reimbursements by Tucker on behalf of the limited partners of TOP,
including the Management Directors, for counsel and other advisors to the
limited partners, of up to an aggregate of $20,000, in order to facilitate a
more orderly and expeditious discussion with Bradley of the proposed Amended
TOP Partnership Agreement.
During this period, Tucker and Bradley negotiated the terms of the
definitive Merger Agreement. Tucker's comments focused on, among other things,
the actions which the parties could take between the execution of the Merger
Agreement and the closing, including the manner in which Tucker's Board could
address and consider any subsequent acquisition proposal, the payment of
dividends, the indemnification which would be provided to Tucker's directors
after the transaction, the conditions to closing the transaction, the
termination rights of the various parties, and the amount of the termination
fee to be paid to the parties and the conditions under which such termination
fee would be paid. In particular, Bradley requested that it receive a
termination fee of $4,000,000 plus reimbursement for out-of-pocket expenses up
to $2,000,000 if any one of several specified events occurred following the
execution of the Merger Agreement. Tucker sought to reduce the termination
fee to $1,500,000 (plus reimbursement for reasonable out-of-pocket expenses),
to limit the number of circumstances in which it would be paid and to make the
provision mutual so that Tucker would receive a termination fee from Bradley
under certain circumstances.
In the negotiations concerning the terms of the Merger Agreement, Bradley
requested that its obligations to consummate the transaction be conditioned
on, among other things, a receipt of a favorable environmental report with
respect to one of Tucker's properties. Tucker refused to agree to such a
condition and instead requested that such report be completed prior to the
execution of the Merger Agreement. After extensive negotiations, Bradley
agreed to conduct such study prior to executing the Merger Agreement. As a
result, however, the parties understood that the execution of the definitive
Merger Agreement would have to be delayed until late October when this study
would be completed.
The final negotiations concerning the Merger Agreement centered primarily
on the covenants of the parties between signing of the definitive acquisition
documents and closing, conditions to closing the transaction and the amount of
the termination fee and the circumstances in which it would be paid. Following
extensive negotiations, Bradley agreed to reduce the amount of the termination
fee to $3,000,000 plus reimbursement of out-of-pocket expenses up to
$2,000,000. It was also agreed that this fee only would be paid in certain
limited circumstances. See "The Merger Agreement--Termination Amount and
Expenses." If the Merger Agreement was terminated in certain other
circumstances, the parties agreed that Bradley only would be reimbursed for
its out-of-pocket expenses up to $2,000,000. In exchange for these changes,
Tucker agreed to waive its request that it receive a termination fee or
expense reimbursement. In these negotiations, the parties also agreed that, in
addition to the other conditions set forth in the Merger Agreement, Bradley's
obligation to close the Merger would be conditioned on: (i) receipt of
estoppel certificates with respect to certain leases; (ii) the consent of all
of the limited partners of TOP to the amendment and restatement of the TOP
Partnership Agreement; and (iii) the consent of certain third parties
including the Indenture Trustee for the Tucker REMIC. See "The Merger
Agreement--Conditions to the Merger."
Additionally, during this period, Tucker and Bradley negotiated the
proposed terms of the Amended TOP Partnership Agreement with the Management
Directors acting on behalf of the limited partners of TOP. Bradley's initial
draft of the Amended TOP Partnership Agreement had made significant changes to
the existing agreement which were designed to limit the influence and control
of the limited partners, to cause TOP to operate more like a Bradley
subsidiary controlled by Bradley and to expand certain environmental
indemnities given by the Management Directors at the time of Tucker's initial
public offering in 1993. The Management Directors' comments focused on, among
other things, the ability of the limited partners to approve further issuances
of TOP Units and transactions involving the Surviving Company or TOP, the
allocation of taxable income among the partners of TOP, the continuing
indemnification obligations of the Management Directors with respect to
certain environmental matters relating to TOP's Commons of Chicago Ridge
property, the right of the limited partners to convert their TOP Units into
Bradley Common Stock and the request of the limited
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partners that, in exchange for certain concessions, they be granted
registration rights from Bradley upon the conversion of their TOP Units to
Bradley Common Stock.
On October 20, 1995, Bradley's Board of Directors held a special meeting
to consider the transaction. At such meeting, senior management of Bradley and
its legal and financial advisors updated the Board on the events since its
September 26th meeting, including the terms of the proposed Merger Agreement
and the proposed Amended TOP Partnership Agreement. At this meeting, Alex.
Brown rendered its oral fairness opinion to the Board of Directors that, as of
such date, based upon the facts and circumstances as they existed at the time,
and subject to certain assumptions, factors and limitations set forth in such
opinion, the Exchange Ratio was fair, from a financial point of view, to
Bradley's stockholders. Following such discussions, the Board of Directors of
Bradley unanimously approved the Merger, the proposed Merger Agreement and the
transactions contemplated thereby.
On October 23, 1995, Tucker's Board of Directors held a special meeting
to receive an update on the status of the merger discussions with Bradley. At
such meeting, Tucker's legal advisors gave the Board a presentation on the
terms of the proposed Merger Agreement and the Amended TOP Partnership
Agreement. The Board also reviewed alternatives to the Merger and concluded
that a transaction with Bradley would result in greater long-term value for
Tucker's stockholders than remaining independent.
Following the October 23rd meeting, the Management Directors, as limited
partners of TOP, concluded their negotiations with Bradley and Tucker on the
Amended TOP Partnership Agreement. Following extensive discussions, the
Management Directors agreed that the limited partners would relinquish any
control or approval rights that they have under the TOP Partnership Agreement
in exchange for limitations on the dissolution, merger or sale of all or
substantially all of the assets of TOP during the 24-month period following
consummation of the Merger. The limited partners also agreed to permit
Bradley, as general partner, to issue additional TOP Units under certain
conditions, but received from Bradley registration rights for the resale of
the shares of Bradley Common Stock that they might hold upon the conversion of
their TOP Units. See "The Merger Agreement--Amended TOP Partnership
Agreement." With regard to the environmental indemnity concerning the Commons
of Chicago Ridge, Bradley provided Tucker and the Management Directors with a
copy of an environmental report on the property which had been prepared by the
outside consultant. Extensive negotiations then followed concerning the
results of this report and the remediation work which was recommended by this
consultant. Following these discussions, the parties agreed to hire a new
consultant and to share the cost of the consultant's report on this property.
It was agreed that if the new consultant recommended any remediation efforts
which Bradley wished to implement, TOP and the Management Directors would each
pay fifty percent of the cost of such remediation, with the Management
Directors aggregate liability limited to a maximum of $200,000.
On October 29, 1995, the Tucker Board of Directors met to consider the
proposed merger transaction with Bradley. At this meeting, PaineWebber
rendered its oral fairness opinion to the Board of Directors that, as of such
date, based upon the facts and circumstances as they existed at the time, and
subject to certain assumptions, factors and limitations, the proposed Exchange
Ratio was fair, from financial point of view, to Tucker's stockholders.
Following such discussion, the Board of Directors of Tucker unanimously
approved the Merger, the proposed Merger Agreement, the proposed Amended TOP
Partnership Agreement and the transactions contemplated thereby. In addition,
the Special Committee approved the proposed Amended TOP Partnership Agreement
and the terms of the severance and consulting agreements with members of
management.
REASONS FOR THE MERGER; RECOMMENDATION OF THE BOARD OF DIRECTORS OF TUCKER
At a special meeting of Tucker's Board of Directors held on October 29,
1995, Tucker's management and representatives of PaineWebber made
presentations concerning the business and prospects of Tucker and Bradley, and
the potential combination of Tucker and Bradley. The Tucker Board of
Directors also reviewed the terms of the Merger Agreement with Tucker's
management and Tucker's financial and legal advisors. BY UNANIMOUS VOTE, THE
TUCKER BOARD OF DIRECTORS DETERMINED THAT THE MERGER IS FAIR TO, AND IN THE
BEST INTERESTS OF, TUCKER AND ITS STOCKHOLDERS, APPROVED AND ADOPTED THE
MERGER AND THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY, AND
RESOLVED TO RECOMMEND THAT TUCKER'S STOCKHOLDERS APPROVE THE MERGER AND THE
MERGER AGREEMENT.
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The Tucker Board of Directors believes that the Merger provides an
opportunity for Tucker's stockholders to become equity holders in a REIT with
greater potential than Tucker for long-term appreciation. The Tucker Board of
Directors also believes that the Merger will combine complementary assets of
Tucker and Bradley, while enabling the Tucker portfolio to benefit from the
reputation of Bradley's experienced management team. The Tucker Board of
Directors also believes that the Surviving Company will benefit from Tucker's
field management capabilities. In addition, the Tucker Board of Directors
believes that, to the extent operations of Tucker and Bradley are integrated
following the Merger, cost reductions and other efficiencies will be possible.
In making its determination with respect to the Merger, the Tucker Board
of Directors considered, among other things:
(i) information relating to the financial performance, condition,
business operations and prospects of Tucker and Bradley and current industry,
economic and market conditions. In this regard, the Board of Directors placed
special emphasis on, and viewed as favorable to its determination, interim
1995 historical and projected full year 1995 and 1996 financial information
for both Tucker and Bradley. The Tucker Board believed that Tucker's capital
structure was too highly leveraged. The Tucker Board of Directors also
considered the decline in Tucker's FFO, which has been caused by, among other
things, Tucker's high leverage and difficulty in accessing capital markets.
(ii) possible alternatives to the Merger for enhancing stockholder
value, such as improving the profitability of Tucker's existing property
portfolio, raising additional capital and acquiring new properties. In this
regard, the Board of Directors agreed that, at that time, there were no
feasible alternatives that were available to Tucker that were as likely in the
near term to significantly improve the profitability of Tucker's existing
operations, and that Tucker, as a stand-alone entity, would experience
difficulty in accessing the capital markets on acceptable terms.
(iii) the Tucker Board believed that the Merger was the best offer
reasonably available for Tucker's stockholders. The Board believed that there
were no other prospective purchasers that both had the financial ability to
complete the transaction and would be willing to pay an aggregate
consideration greater than that to be paid by Bradley in the Merger. In
particular, Tucker and its financial advisors had contacted over 12
prospective buyers and had received seven indications of interest at various
times. Certain proposals purported to offer consideration nominally higher
than that to be paid in the Merger, however, all of the parties making such
proposals insisted on performing additional due diligence before finalizing
the amount of the merger consideration. Certain proposals for a cash purchase
price were also subject to the uncertain ability of the purchaser to raise
financing. In the case of other proposed stock transactions, the Tucker Board
believed that none of the other proposals would result in the type of
operating synergies and potential for long-term appreciation offered by a
combination with Bradley.
(iv) the anticipated cost savings and operating efficiencies
available to the Surviving Company from the Merger, particularly in the
reduction of overhead expenses.
(v) the companies' stock price multiples relative to each other and
to the multiples of comparable REITs (see "--Opinion of Tucker's Financial
Advisor"). In particular, the Board viewed as favorable to its determination
the fact that, as of October 29, 1995, Bradley's stock price multiple was
higher than the corresponding multiple for Tucker. In addition, the Board
believed that there was little that Tucker could do in the reasonably
foreseeable future that would be likely to significantly increase Tucker's
stock price multiple. The Board viewed Bradley's higher stock price multiple
as favorable to its determination because such higher multiple suggested that
the Surviving Company's multiple could exceed the multiple of Tucker on a
stand-alone basis.
(vi) the terms of the Merger Agreement, including the Exchange Ratio
and the equity interest in the Surviving Company to be received by Tucker's
stockholders. In this regard, the Board of Directors noted that the Exchange
Ratio had been determined through arms-length negotiations and fairly
reflected the current market price of the common stock of the two companies.
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(vii) the fact that the Merger will be accretive to Bradley's FFO per
share, and thereby will increase the likelihood of an increase in the value of
the Bradley Common Stock to be received by the Tucker stockholders in the
Merger.
(viii) the structure of the Merger. In this regard, the Board of
Directors placed special emphasis on, and viewed as favorable to its
determination, the fact that the Merger, as a "stock-for-stock" rather than a
"cash-for-stock" transaction, will provide an opportunity for Tucker's
stockholders to share in any future appreciation of the Surviving Company, as
well as the fact that the Merger is intended to enable Tucker's stockholders
to convert their shares of Tucker Common Stock into shares of Bradley Common
Stock on a tax-free basis.
(ix) the similarities between the two companies. In this regard, the
Board noted that Bradley and Tucker are of comparable size, both are focused
primarily in the retail sector and the properties of both are concentrated in
the Midwest. The Surviving Company will have a strong grocery store, drug
store and value-oriented retail tenant base, becoming a leading owner and
operator of community shopping centers in the Midwest.
(x) the complementary strengths of the two companies, including
Tucker's property management and leasing capabilities and superior property
level operational systems and Bradley's property acquisition and capital
markets expertise.
(xi) benefits for the Surviving Company's stockholders from the
larger Surviving Company, including the Board's expectation that, in the
future, the Surviving Company will have improved access to capital markets for
future growth. In this regard, the Board noted that Bradley is significantly
less highly leveraged than Tucker, and that the Surviving Company will have
more conservative leverage ratios than Tucker.
(xii) the fact that the Surviving Company will have an increased
number of properties and increased gross leasing area which will allow it to
better attract national tenants and to obtain increased negotiating leverage
with tenants.
(xiii) the Total Market Capitalization of the Surviving Company will
be larger than Tucker's current Total Market Capitalization, providing
Tucker's stockholders with enhanced liquidity.
(xiv) the opinion, analyses and presentations of PaineWebber
described below under "--Opinion of Tucker's Financial Advisor," including the
opinion of PaineWebber to the effect that, as of the date of such opinion, and
based upon and subject to certain matters stated therein, the Exchange Ratio
was fair from a financial point of view to the holders of Tucker Common Stock.
In this respect, while the Tucker Board of Directors did not explicitly adopt
PaineWebber's financial analyses, the Tucker Board of Directors placed special
emphasis on such analyses in its overall evaluation of the Merger and viewed
such analyses as favorable to its determination. The Board viewed
PaineWebber's opinion as favorable to its determination because PaineWebber is
an internationally recognized investment banking firm with experience in the
valuation of businesses and their securities in connection with mergers and
acquisitions and in providing advisory services and raising capital for
companies in the real estate industry.
The Tucker Board also considered certain potentially negative factors in
its deliberations concerning the Merger, including, among others:
(i) the fact that, because the Exchange Ratio is fixed when the
price of Bradley Common Stock falls below $15.50, a decline in the value of
Bradley Common Stock below $15.50 would reduce the value of the consideration
to be received by Tucker's stockholders in the Merger;
(ii) the decline in Bradley's stock price immediately preceding the
execution of the Merger Agreement. In this regard, the Board considered the
fact that there had been a general decline in retail and related industries'
stock prices;
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(iii) the various conditions to Bradley's obligations to consummate
the Merger;
(iv) the risk that the anticipated benefits of the Merger may not be
realized; and
(v) the possibility that Tucker may be required, if the Merger
Agreement is terminated under certain circumstances, to pay Bradley a
termination fee of $3,000,000 and to reimburse Bradley for up to $2,000,000 of
its out-of-pocket expenses incurred in connection with the Merger, and that
such obligations may render it unlikely that another party may subsequently
present an offer for the acquisition of Tucker with consideration having a
greater value.
In view of the wide variety of factors considered by the Tucker Board of
Directors, the Tucker Board of Directors did not quantify or otherwise attempt
to assign relative weights to the specific factors considered in making its
determination. However, in the view of Tucker's Board of Directors, the
potentially negative factors considered by it were not sufficient, either
individually or collectively, to outweigh the positive factors considered by
the Board of Directors in its deliberations relating to the Merger.
The Tucker Board of Directors was aware of PaineWebber's potential long
or short positions in Tucker's securities and that PaineWebber had also
provided financial advisory services and investment banking services in the
past for Bradley (as well as for other public companies which participated in
the solicitation process), including on Bradley's July Offering. The Tucker
Board did not view these facts as unfavorable to the Board's determination or
the Board's special emphasis on PaineWebber's analyses and opinion. The Board
was also aware that a substantial portion of PaineWebber's compensation would
be contingent upon consummation of the Merger and did not view such
contingency as unfavorable to the Board's determination or the Board's special
emphasis on PaineWebber's analyses and opinion. The reasons that the Board did
not view such potential conflicts of PaineWebber unfavorably were (i) the
Board's belief that PaineWebber would adhere to high standards of
professionalism in connection with its engagement; (ii) the fact that
contingent fees for financial advisors are common in merger and acquisition
transactions; and (iii) the fact that such financial advisors frequently
conduct securities trading operations as an integral part of their businesses
and, accordingly, frequently retain the right to effect trades in the
securities of the clients to which they are providing merger and acquisition
advisory services. In addition, the Board was aware that certain members of
the management of Tucker and the Board of Directors of Tucker have certain
interests in the Merger that are separate from the interests of stockholders
of Tucker generally. See "--Interests of Certain Officers and Directors of
Tucker." On balance, the Board viewed such interests as neutral to its
determination because of the Board's belief that such interests were
reasonable under all of the circumstances.
OPINION OF TUCKER'S FINANCIAL ADVISOR
Tucker originally retained PaineWebber to render financial advisory
services in connection with a possible business combination with another
public real estate company. Tucker has requested PaineWebber to render an
opinion as to whether the Exchange Ratio is fair, from a financial point of
view, to the holders of Tucker Common Stock. PaineWebber was not requested to,
and did not make, any recommendation to the Board of Directors of Tucker as to
the Exchange Ratio to be provided for in the Merger, which Exchange Ratio was
determined through negotiations between Tucker and Bradley.
On October 29, 1995, PaineWebber delivered its oral opinion to the Board
of Directors of Tucker, which will be confirmed in writing on the date that
this Joint Proxy Statement/Prospectus is mailed to Tucker stockholders (the
"PaineWebber Opinion"), to the effect that, as of the date of such opinion,
based on PaineWebber's review and subject to the limitations described below,
the Exchange Ratio is fair, from a financial point of view, to the holders of
Tucker Common Stock. The PaineWebber Opinion is directed to the Board of
Directors of Tucker and does not constitute a recommendation to any
stockholder of Tucker as to how any such stockholder should vote on the
Merger. Additionally, the PaineWebber Opinion does not address the relative
merits of the Merger and any other transactions or business strategies
discussed by the Board of Directors of Tucker as alternatives to the Merger or
the decision of the Board of Directors of Tucker to proceed with the Merger.
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TUCKER STOCKHOLDERS ARE URGED TO READ THE PAINEWEBBER OPINION (A COPY OF
WHICH WILL BE ATTACHED AS ANNEX B TO THIS JOINT PROXY STATEMENT/PROSPECTUS)
CAREFULLY AND IN ITS ENTIRETY FOR A DESCRIPTION OF THE PROCEDURES FOLLOWED AND
THE FACTORS CONSIDERED BY PAINEWEBBER.
In rendering its opinion, PaineWebber has, among other things: (i)
reviewed, among other public information, the prospectus used by Tucker in the
initial public offering of the Tucker Common Stock in October 1993, Tucker's
Forms 10-K and related financial information for the fiscal years ended
December 31, 1993 and December 31, 1994 and Tucker's Form 10-Q and the related
unaudited financial information for the six months ended June 30, 1995; (ii)
reviewed, among other public information, Bradley's Forms 10-K, Prospectus
Supplement filed on June 29, 1995, Prospectus filed on June 30, 1993 and
related financial information for the three fiscal years ended December 31,
1994 and the related unaudited financial information for the six months ended
June 30, 1995; (iii) reviewed certain information, including financial
forecasts, related to the business, earnings, cash flow, assets and prospects
of Tucker and Bradley, furnished to PaineWebber by Tucker and Bradley,
respectively; (iv) conducted discussions with members of the senior management
of Tucker and Bradley concerning their respective businesses and prospects;
(v) reviewed the historical market prices and trading activities for Tucker
Common Stock and Bradley Common Stock and compared such prices and trading
histories with those of certain other publicly-traded companies which
PaineWebber deemed to be relevant; (vi) compared the financial position and
results of operations of Tucker and Bradley with those of certain other
publicly-traded companies which PaineWebber deemed to be relevant; (vii)
reviewed the Merger Agreement; (viii) reviewed the Amended TOP Partnership
Agreement; and (ix) reviewed such other financial studies and analyses and
performed such investigations and took into account such other matters as
PaineWebber deemed appropriate, including its assessment of general economic,
market and monetary conditions.
In preparing its opinion, PaineWebber relied, without independent
verification, on the accuracy and completeness of all information that was
publicly available, supplied or otherwise communicated to PaineWebber by
Tucker and Bradley. PaineWebber assumed that the financial forecasts examined
by it were reasonably prepared and reflected the best currently available
estimates and good faith judgments of the managements of Tucker and Bradley as
to the future performance of Tucker and Bradley, respectively. PaineWebber
also assumed, with the consent of Tucker, that (i) the Merger will be
accounted for under the purchase method of accounting; (ii) the Merger will be
a tax-free reorganization; and (iii) any material liabilities (contingent or
otherwise, known or unknown) of Tucker and Bradley are as set forth in the
consolidated financial statements of Tucker and Bradley, respectively.
PaineWebber has not made an independent evaluation or appraisal of the assets
or liabilities (contingent or otherwise) of Tucker or Bradley, nor has
PaineWebber been furnished with any such evaluations or appraisals. The
PaineWebber Opinion is based upon economic, monetary and market conditions
existing on the date thereof. Furthermore, PaineWebber has expressed no
opinion as to the price or trading range at which the shares of Bradley Common
Stock will trade in the future.
The preparation of a fairness opinion involves various determinations as
to the most appropriate and relevant quantitative methods of financial
analyses and the application of those methods to the particular circumstances
and, therefore, such an opinion is not readily susceptible to partial analysis
or summary description. Accordingly, PaineWebber believes that its analysis
must be considered as a whole and that considering any portion of the analysis
and of the factors considered, without considering all analyses and factors,
could create a misleading or incomplete picture of the process underlying the
PaineWebber Opinion. Any estimates contained in these analyses are not
necessarily indicative of actual values or predictive of future results or
values, which may be significantly more or less favorable than as set forth
therein. In addition, analyses relating to the values of businesses do not
purport to be appraisals or to reflect the prices at which businesses may
actually be sold. Accordingly, such analyses and estimates are inherently
subject to substantial uncertainty and neither Tucker nor PaineWebber assumes
responsibility for the accuracy of such analyses or estimates. The following
paragraphs summarize the significant quantitative and qualitative analyses
performed by PaineWebber in arriving at the PaineWebber Opinion.
Capitalization Rate Valuation Analysis. In general, PaineWebber applied
capitalization rates to the projected 1996 Net Operating Income (defined as
revenues less property operating expenses, before interest expense and
depreciation) of each of the Tucker properties, adjusted for assumed
management costs and a reserve for capital expenditures. In the case of the
Commons of Chicago Ridge, projected 1997 Net Operating Income was used in
light of the current anchor tenant vacancy. In the case of Meadows Town Mall,
projected
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1997 Net Operating Income was used in light of expected significant
redevelopment of the property in 1996. For both properties, projected 1997 Net
Operating Income was greater than projected 1996 Net Operating Income. In the
case of Rollins Crossing, a property currently under development, projected
stabilized 1998 Net Operating Income was used. PaineWebber applied
capitalization rates of 10.0%-12.5% to each of the properties, with the
exception of Rollins Crossing where a capitalization rate of 15.0% was used,
primarily to account for development and lease-up risk. The resulting total
value reflected an overall capitalization rate of 10.97% on the total blended
Net Operating Income used (adjusted for assumed management costs and a reserve
for capital expenditures). PaineWebber noted that this translated into a
capitalization rate of approximately 9.75% on projected 1996 Net Operating
Income for all properties (adjusted for assumed management costs and a reserve
for capital expenditures). PaineWebber derived a valuation range reflecting a
25 basis point discount and premium to the value calculated using the 10.97%
capitalization rate on the blended total Net Operating Income. This valuation
range produced equity values for Tucker of $9.94 to $11.12 per share. Based
on the Bradley October 25, 1995 closing stock price of $15.25, the implied
exchange ratio is .652 to .729. PaineWebber noted that the range of possible
Exchange Ratios (i.e., between .665 and .686) falls within the implied
exchange ratio range.
Selected Comparable Public Companies Analysis. Using publicly available
information, PaineWebber compared selected historical and projected financial,
operating and stock market performance data of Tucker and Bradley to the
corresponding data of certain publicly-traded companies that PaineWebber
considered comparable to each (the "Tucker Comparables" and the "Bradley
Comparables," respectively). The Tucker Comparables represented relatively
highly-leveraged community shopping center REITs (as implied by the ratio of
debt to Total Market Capitalization, defined as the ratio of (a) outstanding
debt to (b) outstanding debt plus the market value of outstanding common
stock) that had been predominately brought public since 1992. These companies
consisted of Kranzco Realty Trust, Mark Centers Trust, Mid-America Realty
Investments and Saul Centers, Inc. The Bradley Comparables represented
relatively low-leveraged community shopping center REITs that were considered
by the investment community generally to have stronger growth prospects.
These companies consisted of Developers Diversified Realty Corporation,
Federal Realty Trust, IRT Property Company, JDN Realty Corporation and
Weingarten Realty Investors.
PaineWebber derived a range of per share values for Tucker by applying
Tucker's FFO per share for three selected time periods to the corresponding
FFO multiple for the Tucker Comparables for those same periods. The three
periods selected were the twelve months ended June 30, 1995, the year ended
December 31, 1995 and the year ended December 31, 1996. Tucker's FFO for the
twelve months ended June 30, 1995 reflected its actual results, while the FFO
for the years ended December 31, 1995 and 1996 reflected Tucker management's
expected results. The median FFO multiple for the twelve months ended June
30, 1995 reflected the actual FFO results of the Tucker Comparables, while the
median FFO multiple for the year ended December 31, 1995 and the year ended
December 31, 1996 reflected the First Call FFO estimates for the Tucker
Comparables for those respective periods. In calculating the FFO multiple for
the three selected periods, the October 25, 1995 closing stock prices of the
Tucker Comparables were used. Based on this analysis, PaineWebber derived
values of $11.13, $10.45 and $10.39 for the twelve months ended June 30, 1995,
the year ended December 31, 1995 and the year ended December 31, 1996,
respectively. Based on the Bradley October 25, 1995 closing stock price of
$15.25, PaineWebber derived an implied range of exchange ratios of .681 to
.730. PaineWebber noted that the range of possible Exchange Ratios (i.e.,
.665 to .686) includes values toward the low end of the implied exchange ratio
range.
With respect to Bradley and the Bradley Comparables, PaineWebber compared
Bradley's FFO multiple to the median FFO multiple for the Bradley Comparables
for three selected time periods. The three periods selected were the twelve
months ended June 30, 1995, the year ended December 31, 1995 and the year
ended December 31, 1996. For Bradley and the Bradley Comparables, the FFO
multiples for the twelve months ended June 30, 1995 were based on actual FFO
performance, while the FFO multiples for Bradley and the Bradley Comparables
for the year ended December 31, 1995 and the year ended December 31, 1996 were
based on First Call FFO estimates for those periods. In calculating the FFO
multiple for the three selected periods, the October 25, 1995 closing stock
prices of Bradley and its comparable companies were used. PaineWebber noted
that Bradley's 9.5x multiple of latest twelve months FFO, 9.3x multiple of
1995 FFO and 8.8x multiple of 1996 FFO is below the median of the Bradley
Comparables (11.5x, 11.4x, and 10.4x, respectively).
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Adjusted Capital Structure Valuation Analysis. PaineWebber derived an
implied range of Tucker share prices based on a hypothetical equity
transaction that would allow Tucker to achieve a ratio of debt to Total Market
Capitalization similar to community shopping center REITs considered by the
investment community to have conservative capital structures (i.e., 25% to
35%). The analysis was based on adjustments to Tucker management's projected
1996 FFO estimates related to the reduction of debt and increase in number of
shares resulting from the hypothetical equity offering. In addition,
PaineWebber assumed that Tucker's FFO multiple improved to the range of 8.0x
to 10.0x as a result of the improved capital structure.
The analysis resulted in a range of adjusted equity valuations of $8.83
to $11.57 per share. Based on this analysis and the Bradley October 25, 1995
closing stock price of $15.25, PaineWebber derived an implied range of
exchange ratios of .579 to .759. PaineWebber noted that the range of possible
Exchange Ratios (i.e., .665 to .686) falls within the implied exchange ratio
range.
Pro Forma Merger Analysis. PaineWebber performed an analysis of the
effect of the Merger on Bradley's FFO per share for the projected years ended
December 31, 1995 through December 31, 1998, which assumed that the Merger had
been consummated on January 1, 1995. PaineWebber combined the projected
operating results of Tucker (based on Tucker's internal estimates) with the
corresponding projected operating results of Bradley (based on Bradley's
internal estimates) to arrive at the combined company projected FFO.
PaineWebber assumed an Exchange Ratio of .686 and approximately $500,000 in
annual synergistic savings from the Merger, arising primarily from savings in
duplicative public company and general and administrative expenses.
PaineWebber then compared the combined company FFO per share to Bradley's
stand-alone FFO to determine the projected pro forma impact of the Merger on
Bradley's FFO per share. This analysis indicated that the pro forma impact of
the Merger was accretive to Bradley's FFO per share in 1996, 1997 and 1998.
While PaineWebber noted that this accretion to Bradley's projected FFO
per share was substantial, PaineWebber also noted that the Merger resulted in
a substantial increase in Bradley's ratio of debt to Total Market
Capitalization. Specifically, PaineWebber noted that this ratio would
increase, on a pro forma basis, from approximately 17% to approximately 42% as
a result of the Merger, based on the market value of Bradley's shares on
October 25, 1995 and the debt outstanding of Tucker and Bradley on June 30,
1995. PaineWebber noted that a significant reduction in this ratio (by means
of a common equity offering or other equity financing) would be likely to
significantly reduce the accretive impact of the Merger.
Stock Trading History. PaineWebber reviewed the history of trading prices
and volume for Tucker Common Stock and Bradley Common Stock, both separately
and in relation to the Standard & Poor's 500 Index and the PaineWebber REIT
Index. The PaineWebber REIT Index includes 92 equity REITs representing every
property category, including retail, multifamily, commercial, mixed and
lodging. In addition, PaineWebber reviewed the historical implied exchange
ratio between Tucker and Bradley and compared this to the Exchange Ratio.
PaineWebber noted that the Exchange Ratio range of .665 to .686 falls within
the historical exchange ratio range as implied by the recent stock performance
of both companies.
Discounted Equity Valuation Analysis. PaineWebber analyzed Tucker based
on a discounted cash flow analysis using Tucker's three-year projections of
FFO and cash flow distributions. PaineWebber derived a range of values per
share by calculating the present value of the three years of projected per
share distributions and a terminal equity value. PaineWebber assumed that the
range of discount rates used of 13% to 17% was representative of the risks
inherent in the ownership of Tucker Common Stock. The terminal equity value
was calculated using Tucker's projected FFO per share in the third year and a
range of FFO multiples from 7.0x to 8.0x, which multiples were consistent with
the historical trading levels of Tucker's shares. Based on this analysis and
the Bradley October 25, 1995 closing stock price of $15.25, PaineWebber
derived a range of possible equity values of $9.82 to $11.99 per share, which
implied a range of exchange ratios between .644 and .786. PaineWebber noted
that the range of possible Exchange Ratios (i.e. .665 to .686) falls within
the implied exchange ratio range.
Contribution Analysis. PaineWebber reviewed Tucker's and Bradley's
financial contribution to the combined entity on a projected pro forma basis.
On a pro forma basis, Tucker's stockholders are retaining 40.1% to 40.9%
(using the Exchange Ratio range of between .665 to .686) of the ownership in
the combined company. Based on Tucker management's financial projections for
1996 through 1998 and Bradley
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management's financial projections for the same period, Tucker would
contribute on average 48.2% of the FFO of the combined company and 57.0% of
the property-level Net Operating Income of the combined company. PaineWebber
noted that the contribution analysis is impacted by the level of debt on
Tucker's and Bradley's balance sheets. Specifically, the greater the
percentage of debt in a company's capital structure, the greater that
company's FFO (assuming its cost of debt is less than its cost of equity,
which generally is true and is true for Tucker). On a pro forma basis, based
on the June 30, 1995 balance sheet of each company, Tucker's ratio of debt to
Total Market Capitalization was 59.4% while Bradley's ratio of debt to Total
Market Capitalization was 16.6%.
Comparative Merger Analysis. Using public information, PaineWebber
compared selected financial, operating and stock market performance data of
Tucker with that of certain REITs that have recently consummated merger or
acquisition transactions. These transactions consisted of Wellsford
Residential Property Trust's acquisition of Holly Residential Properties,
Inc., Horizon Outlet Centers, Inc.'s acquisition of McArthur/Glen Realty
Corp., and Mid-America Apartment Communities Inc.'s acquisition of America
First REIT Inc. PaineWebber noted that there were no directly comparable
merger or acquisition transactions.
Pursuant to an engagement letter dated February 17, 1995, PaineWebber
will receive a fee of $250,000 upon delivery of the PaineWebber Opinion and
its inclusion in this Joint Proxy Statement/Prospectus. In addition,
PaineWebber will receive a fee equal to 1.3% of the total consideration
received by Tucker's stockholders in the Merger (excluding from such
consideration any assumption by Bradley of Tucker's outstanding indebtedness),
less the $250,000 to be paid in connection with the delivery of the
PaineWebber Opinion. PaineWebber's fee is estimated to total approximately
$1.4 million. PaineWebber will also be reimbursed for certain of its expenses,
in an amount not to exceed $75,000. Tucker has also agreed to indemnify
PaineWebber, its affiliates and each of its directors, officers, employees,
agents, consultants and attorneys, and each person or firm, if any,
controlling PaineWebber or any of the foregoing, against certain liabilities,
including liabilities under federal securities law.
In the past, PaineWebber and its affiliates have provided financial
advisory services and investment banking services to Tucker and received fees
for the rendering of these services. PaineWebber has in the past provided
financial advisory services and investment banking services to Bradley
(including, without limitation, acting as managing underwriter for the July
Offering of Bradley Common Stock) and has received fees for such services. In
the ordinary course of PaineWebber's business, PaineWebber may actively trade
the securities of Tucker and Bradley for its own account and for the accounts
of its customers and, accordingly, PaineWebber may at any time hold long or
short positions in such securities.
In rendering the PaineWebber Opinion, PaineWebber has not been engaged to
act as an agent or fiduciary of, and the Board of Directors of Tucker has
expressly waived any duties or liabilities PaineWebber may otherwise be deemed
to have had to, Tucker's equity holders or any other third party.
The Board of Directors of Tucker retained PaineWebber to act as its
advisor based upon PaineWebber's prominence as an investment banking and
financial advisory firm with experience in the valuation of businesses and
their securities in connection with mergers and acquisitions, negotiated
underwritings, secondary distributions of securities, private placements and
valuations for corporate purposes especially with respect to REITs and other
real estate companies.
REASONS FOR THE MERGER; RECOMMENDATION OF THE BOARD OF DIRECTORS OF BRADLEY
The Board of Directors of Bradley believes that the Merger is fair to and
in the best interests of Bradley and its stockholders. ACCORDINGLY, THE BOARD
OF DIRECTORS OF BRADLEY HAS UNANIMOUSLY APPROVED THE MERGER AND THE MERGER
AGREEMENT AND UNANIMOUSLY RECOMMENDS THAT ITS STOCKHOLDERS APPROVE THE MERGER
AND THE MERGER AGREEMENT. In reaching this determination, the Board of
Directors of Bradley consulted with Bradley management, as well as its
financial advisors, legal counsel and accountants, and considered a number of
factors. The primary factors that Bradley's Board of Directors considered in
reaching the foregoing conclusions were its belief that:
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(i) The Merger will result in the Surviving Company becoming one of
the leading owners and operators of community shopping centers in
the Midwest; it will own 31 community shopping centers
encompassing approximately 7.3 million square feet of rentable
retail space in eleven states.
(ii) The Merger will enhance the Surviving Company's position relating
to leasing. Given Tucker's significant tenant base, the Merger
will provide the Surviving Company with a broader and more
diverse group of tenants, will expand the geographic focus of the
Surviving Company's portfolio and will increase the gross leasing
area, reducing the potential impact on the Surviving Company of
the loss of any tenants and enhancing the Surviving Company's
ability to attract national tenants and to obtain increased
negotiating leverage with tenants.
(iii) The Merger will be accretive to the Surviving Company's FFO per
share in 1996 and 1997. The Unaudited Pro Forma Combined
Financial Statements contained herein illustrate the effect of
the Merger on FFO for the nine months ended September 30, 1995.
On a pro forma basis, FFO per share is $1.33 for the nine months
ended September 30, 1995, instead of $1.20 on a historical basis.
See "Unaudited Pro Forma Combined Financial Statements."
(iv) The Total Market Capitalization of the Surviving Company as of
September 30, 1995 would be approximately $484.0 million, which
would be considerably greater than Bradley's Total Market
Capitalization of $193.2 million on such date. Based in part on
discussions with advisors, investment banking firms and lenders,
the Board of Directors believes that this increased Total Market
Capitalization will provide Bradley's stockholders with enhanced
liquidity and will make shares of Bradley Common Stock a more
attractive investment for institutional investors, thereby
enhancing Bradley's ability to raise additional equity in the
future. The Board of Directors believes that the greater Total
Market Capitalization will also make it possible for the
Surviving Company to secure debt financing from sources such as
the investment grade debt market, convertible debt market and
private placement markets at potentially lower interest costs and
more flexible terms than those currently obtained by either
Bradley or Tucker.
(v) The Merger will enhance the ability of the Surviving Company to
improve the terms of its revolving credit agreement, including
increasing the amount available for borrowing under such line and
obtaining such financing on an unsecured basis. See "The
Companies--Surviving Company."
(vi) The Merger will lead to on-going operating synergies and
additional cost savings, initially estimated to be approximately
$1.4 million per annum prior to the offset of costs associated
with the Merger (which costs are estimated to be approximately
$8.5 million). The opportunities for economies of scale and
operating efficiencies should result in significant savings for
annual general and administrative costs and property operating
costs, particularly due to the integration of office facilities,
information systems, support functions and the combined
purchasing power of the two companies.
(vii) The Merger will broaden Bradley's property management
capabilities. While the current executive officers and directors
of Bradley will manage the business and affairs of the Surviving
Company, Bradley currently intends to continue to employ most of
Tucker's property management personnel following the consummation
of the Merger. Given the strength of Tucker's property-level
operational personnel and systems, Bradley's management believes
the Merger will broaden its existing property management
capabilities and allow the Surviving Company to internalize its
property management and leasing functions.
(viii) The Merger can be effectuated through the issuance of Bradley
Common Stock, rather than through the use of cash or a public
offering of equity or debt securities, which the Board of
Directors viewed as favorable.
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(ix) The opinion of Alex. Brown to the effect that, as of the date of
such opinion and based upon and subject to certain matters stated
therein, the Exchange Ratio was fair, from a financial point of
view, to Bradley's stockholders.
(x) Under generally accepted accounting principles, the Merger will
be accounted for as a purchase and for federal income tax
purposes, will generally be a tax-free transaction, which the
Board of Directors viewed as favorable because no gain or loss
will be recognized by Bradley, Tucker or any stockholder of
Tucker who receives Bradley Common Stock in exchange for Tucker
Common Stock (except with respect to any cash received in lieu of
a fractional interest in Bradley Common Stock).
The Board of Directors of Bradley also considered certain potentially
negative factors which could arise from the Merger. These included, among
others, the significant transaction costs involved in connection with
consummating the Merger (estimated at approximately $8.5 million) and the
substantial management time and effort required to effectuate the Merger and
to integrate the businesses of Bradley and Tucker. The Board of Directors of
Bradley also considered that the Merger would significantly increase the ratio
of debt to Total Market Capitalization of the Surviving Company. The Board of
Directors of Bradley also recognized this increase in leverage could adversely
affect the market for Bradley Common Stock and Bradley's ability to raise
capital and issue equity in both the public and private markets. Despite this
increase, the Board noted that the Surviving Company's ratio of debt to Total
Market Capitalization would be close to the median level for shopping center
REITs. The Board also considered the benefits of the transaction to be
received by certain parties, including certain officers and directors of
Tucker. Finally, the Bradley Board of Directors considered the risk that the
anticipated benefits of the Merger might not be fully realized.
In view of the wide variety of factors considered by the Bradley Board of
Directors, the Bradley Board of Directors did not quantify or otherwise
attempt to assign relative weights to the specific factors considered in
making its determination. However, in the view of Bradley's Board of
Directors, the potentially negative factors considered by it were not
sufficient, either individually or collectively, to outweigh the positive
factors considered by the Board of Directors in its deliberations relating to
the Merger.
OPINION OF BRADLEY'S FINANCIAL ADVISOR
In early September 1995, Bradley engaged Alex. Brown to provide certain
investment banking advice and services in connection with the possible
acquisition of Tucker, including rendering its opinion as to the fairness,
from a financial point of view, of the Exchange Ratio to Bradley's
stockholders. A letter agreement confirming the terms of such agreement was
entered into between Bradley and Alex. Brown on September 15, 1995.
At the September 26, 1995 meeting of the Bradley Board of Directors,
representatives of Alex. Brown made a presentation with respect to the Merger
and stated that Alex. Brown believed it would be able to provide a fairness
opinion on the Exchange Ratio, based upon the transaction as then negotiated
and upon the facts and circumstances as they existed at the time, subject to
certain assumptions, factors and limitations.
At the October 20, 1995 meeting of the Bradley Board of Directors,
representatives of Alex. Brown amended and supplemented its September 26, 1995
presentation with respect to the Merger and rendered an oral opinion to the
Board of Directors, subsequently confirmed in writing on October 30, 1995,
that, as of such date, based upon the facts and circumstances as they existed
at the time, and subject to certain assumptions, factors and limitations set
forth in such opinion, the Exchange Ratio was fair, from a financial point of
view, to Bradley's stockholders. No limitations were imposed upon Alex. Brown
with respect to the investigations made or procedures followed by it in
rendering its opinion.
THE FULL TEXT OF ALEX. BROWN'S WRITTEN OPINION DATED OCTOBER 30, 1995,
WHICH SETS FORTH, AMONG OTHER THINGS, ASSUMPTIONS MADE, MATTERS CONSIDERED AND
LIMITATIONS ON THE REVIEW UNDERTAKEN, IS ATTACHED AS ANNEX C TO THIS JOINT
PROXY STATEMENT/PROSPECTUS. BRADLEY STOCKHOLDERS ARE URGED TO READ THIS
OPINION IN ITS ENTIRETY. ALEX. BROWN DID NOT RECOMMEND TO BRADLEY THAT ANY
SPECIFIC EXCHANGE RATIOS CONSTITUTED THE APPROPRIATE EXCHANGE RATIO FOR THE
MERGER. ALEX. BROWN'S OPINION IS ADDRESSED TO THE BOARD OF DIRECTORS OF
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BRADLEY, ADDRESSES ONLY THE FAIRNESS, FROM A FINANCIAL POINT OF VIEW, OF THE
EXCHANGE RATIO TO BRADLEY'S STOCKHOLDERS AND DOES NOT CONSTITUTE A
RECOMMENDATION TO ANY BRADLEY STOCKHOLDER AS TO HOW SUCH STOCKHOLDER SHOULD
VOTE AT THE BRADLEY SPECIAL MEETING. THE OPINION WAS RENDERED TO THE BOARD OF
DIRECTORS OF BRADLEY FOR ITS CONSIDERATION IN DETERMINING WHETHER TO APPROVE
THE MERGER AND THE MERGER AGREEMENT. THE DISCUSSION OF THE OPINION IN THIS
JOINT PROXY STATEMENT/PROSPECTUS IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
THE FULL TEXT OF THE OPINION.
In rendering such opinion, Alex. Brown (i) reviewed the Merger Agreement
and certain related documents; (ii) reviewed certain publicly available
financial information concerning Bradley and Tucker and certain internal
financial analyses and other information furnished to it by Bradley and
Tucker; (iii) held discussions with members of the senior managements of
Bradley and Tucker regarding the business and prospects of Bradley and Tucker;
(iv) reviewed the historical reported prices and trading information for
Bradley Common Stock and Tucker Common Stock; (v) compared certain financial
and stock market information for Tucker and Bradley with similar information
for certain other companies whose securities are publicly-traded; (vi)
reviewed the financial terms of certain recent business combinations; and
(vii) performed such other studies and analyses and considered such other
factors as it deemed comparable, in whole or in part.
In conducting its review and arriving at its opinion, Alex. Brown
assumed, without independent verification, the accuracy and completeness of
the information that it reviewed and relied upon for purposes of rendering its
opinion. With respect to the financial projections of Bradley and Tucker and
other information relating to the prospects of Bradley and Tucker provided to
Alex. Brown by each company, Alex. Brown assumed that such projections and
other information were reasonably prepared and reflected the currently
available judgments and estimates of the respective managements of Bradley and
Tucker as to the likely future financial performances of their respective
companies and of the combined entity. Although Alex. Brown made the foregoing
assumptions concerning the financial projections and other information, in the
course of its due diligence, Alex. Brown reviewed certain of these assumptions
with the respective managements of Bradley and Tucker to confirm that the
assumptions appeared to have a reasonable basis. The financial projections of
Bradley and Tucker that were provided to Alex. Brown were utilized and relied
upon by Alex. Brown in both the Pro Forma Combination Analysis and the
Contribution Analysis summarized below. Alex. Brown also assumed that (i) the
Merger will be accounted for under the purchase method of accounting; (ii) the
Merger will be a tax-free reorganization; and (iii) any material liabilities
(contingent or otherwise, known or unknown) of Tucker and Bradley are as set
forth in the consolidated financial statements of Tucker and Bradley,
respectively. In addition, Alex. Brown did not make and it was not provided
with an independent evaluation or appraisal of the assets of Bradley or
Tucker, nor did it make any physical inspection of the properties or assets of
Bradley or Tucker. Alex. Brown's opinion is based on market, economic and
other conditions as they existed and could be evaluated as of the date of the
opinion letter. Such conditions include, without limitation, the condition of
the U.S. stock markets, particularly in the real estate sectors, and the
current level of economic activity.
The following is a summary of the written materials (the "Alex. Brown
Report") prepared by Alex. Brown in connection with rendering its fairness
opinion to the Board of Directors of Bradley. For purposes of the analyses
performed in connection with the preparation of its fairness opinion, Alex.
Brown assumed the Exchange Ratio set forth in the Merger Agreement.
Discounted Cash Flow Analysis. Alex. Brown analyzed the financial terms
of the Merger using a discounted cash flow approach. The discounted cash flow
approach assumes, as a basic premise, that the intrinsic value of any business
is the current value of the future cash flow that the business will generate
for its owners. To establish a current value under this approach, future cash
flow must be estimated and an appropriate discount rate determined. Alex.
Brown used projections and other information provided by the managements of
Bradley and Tucker to estimate the free cash flows, defined as total revenues
minus property operating and maintenance expenses, property management
expenses, real estate taxes and capital expenditures ("Free Cash Flows") for
the years ended 1996 through 2005, inclusive, using discount rates ranging
from 10.00% to 13.00% and terminal value capitalization rates applied to 2005
projected Free Cash Flow ranging from 9.00% to 11.50%. Alex. Brown's
calculations resulted in a range of values from $250,492,000 to $330,915,000
for Tucker's real estate, on an unleveraged basis, based upon Tucker's
projected Free Cash Flow,
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with the imputed value of Tucker's real estate being approximately
$283,400,000 under the terms of the Merger.
Alex. Brown also applied a discounted cash flow analysis to Tucker's
projected FFO, defined as net income, excluding extraordinary gains or losses,
plus depreciation from real estate assets, and funds available for
distribution, defined as FFO less capital expenditures, tenant improvements
and commissions ("Funds Available for Distribution"), using discount rates
ranging from 11.50% to 14.25% and terminal value capitalization rates applied
to 2005 FFO and Funds Available for Distribution, as the case may be, ranging
from 9.00% to 11.50%. Alex. Brown's calculations resulted in the following
ranges of values for Tucker: based on a discounted cash flow analysis of
Tucker's projected FFO of $129,933,000 to $167,043,000; and, based on a
discounted cash flow analysis of Tucker's projected Funds Available for
Distribution of $101,191,000 to $131,319,000. Based upon the terms of the
Merger, Tucker's imputed value is $116,100,000.
Pro Forma Combination Analysis. Alex. Brown reviewed the effects of the
Merger on Bradley's projected FFO for 1995 and 1996, calculated on a pro forma
basis as if the Merger had been completed on January 1, 1995 and after giving
effect to the synergies which Bradley anticipates realizing. Based on such
analysis, Alex. Brown observed that the Merger would be accretive to Bradley's
FFO per share on a pro forma basis in 1995 and 1996.
Contribution Analysis. Alex. Brown also analyzed the relative
contributions of Bradley and Tucker to certain pro forma projected income
statement and balance sheet information (excluding the effect of any synergies
which may be realized from the Merger). The analysis indicated that on a pro
forma combined basis, based on projected performance for 1996, Bradley and
Tucker, respectively, would account for approximately 43% and 57% of the
Surviving Company's revenues; 44% and 56% of the Surviving Company's net
operating income; 77% and 23% of the Surviving Company's net income; 57% and
43% of the Surviving Company's FFO; and 59% and 41% of the Surviving Company's
outstanding common stock. Alex. Brown observed that Tucker's pro forma
contribution to the combined company's FFO slightly exceeded the proportion of
Bradley Common Stock to be received by Tucker stockholders in the Merger.
Selected Transactions Analysis. Alex. Brown reviewed the financial terms,
to the extent publicly available, of six pending and completed mergers and
acquisitions between publicly-traded REITs (the "Selected Transactions").
Alex. Brown calculated various financial multiples and the premium over market
value based on certain publicly available information for each of the Selected
Transactions and compared them to corresponding financial multiples and the
premium over market for the Merger, based on the Exchange Ratio of .686. Under
this approach, Alex. Brown considered the following acquisitions: (i) Health
Equity Properties, Incorporated acquisition by Omega Healthcare Investors,
Inc., (ii) Holly Residential Properties, Inc. acquisition by Wellsford
Residential Property Trust, (iii) Security Capital Pacific Incorporated
acquisition by Property Trust of America, (iv) America First REIT, Inc.
acquisition by Mid-America Apartment Communities, Inc., (v) McArthur/Glen
Realty Corp. acquisition by Horizon Outlet Centers, Inc., and (vi) Real Estate
Investment Trust of California acquisition by BRE Properties, Inc. Alex. Brown
noted the multiple of the equity purchase price to last twelve months' FFO was
7.0x for the Merger versus a range of 8.0x to 16.2x, with a mean of 12.7x, for
the Selected Transactions. Alex. Brown further noted that the multiples of
adjusted purchase price (equity purchase price adjusted for debt and cash) to
last twelve months' revenues, net operating income, earnings before interest,
taxes, depreciation and amortization ("EBITDA") and total real estate assets
(at cost) were as follows: based upon the ratio of adjusted purchase price to
revenues, 5.6x for the Merger versus a range of 5.9x to 8.6x, with a mean of
7.2x, for the Selected Transactions; based upon the ratio of adjusted purchase
price to net operating income, 8.9x for the Merger versus a range of 9.7x to
24.3x, with a mean of 13.0x, for the Selected Transactions; based upon the
ratio of adjusted purchase price to EBITDA, 9.8x for the Merger versus a range
of 7.7x to 16.7x, with a mean of 11.9x, for the Selected Transactions; and,
based upon the ratio of adjusted purchase price to total real estate assets
(at cost), .9x for the Merger versus a range of .6x to 1.4x, with a mean of
1.1x, for the Selected Transactions. Alex. Brown also noted that the Selected
Transactions were effected at a range of premia to the target's stock price
one day prior to public announcement of the acquisition of .6% to 46.3%, with
the Merger at 4.9% (based upon the closing prices of Bradley Common Stock and
Tucker Common Stock on September 8, 1995, the last trading day prior to the
public announcement of negotiations between Bradley and Tucker).
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Selected Public Companies Analysis. Alex. Brown also compared certain
financial information relating to Bradley and Tucker to certain corresponding
information from a group of sixteen REITs engaged primarily in the
acquisition, operation and management of retail shopping centers. Alex. Brown
considered the following companies: Alexander Haagen Properties Inc.,
Developers Diversified Realty Corporation, Federal Realty Investment Trust,
Glimcher Realty Trust, IRT Property Company, JDN Realty Corporation, JP
Realty, Inc., Kimco Realty Corporation, Kranzco Realty Trust, Mark Centers
Trust, New Plan Realty Trust, Regency Realty Corporation, Saul Centers, Inc.,
Vornado Realty Trust, Weingarten Realty Investors and Western Investment Real
Estate Trust (the "Public Companies"). Alex. Brown noted the multiple of the
equity purchase price (equity market capitalization for the Public Companies)
to last twelve months' FFO was 7.0x for the Merger versus a range of 5.6x to
15.8x, with a mean of 10.9x, for the Public Companies. Alex. Brown further
noted that the multiples of adjusted purchase price (total market
capitalization, defined as equity market capitalization plus debt, for the
Public Companies) to last twelve months' revenues, net operating income,
EBITDA and total real estate assets (at cost) were as follows: based upon the
ratio of adjusted purchase price to revenues, 5.6x for the Merger versus a
range of 5.7x to 12.0x, with a mean of 8.6x, for the Public Companies; based
upon the ratio of adjusted purchase price to net operating income, 8.9x for
the Merger versus a range of 7.7x to 17.2x, with a mean of 12.0x, for the
Public Companies; based upon the ratio of adjusted purchase price to EBITDA,
9.8x for the Merger versus a range of 9.1x to 16.5x, with a mean of 11.9x for
the Public Companies; and, based upon the ratio of adjusted purchase price to
total real estate assets (at cost), .9x for the Merger versus a range of .8x
to 3.1x, with a mean of 1.3x, for the Public Companies.
Additionally, Alex. Brown compared, among other things, the debt to Total
Market Capitalization ratios (ratio of total debt from the most recent Form
10-Q to Total Market Capitalization as of October 27, 1995), fiscal year 1996
estimated dividend payout ratios and equity market capitalization as a
multiple of fiscal year 1996 estimated FFO of Bradley, prior to the Merger and
pro forma after the Merger (based upon projections and other information
provided by the respective managements of Bradley and Tucker), with the
corresponding ratios of the Public Companies. The ranges of debt to Total
Market Capitalization ratios, payout ratios and equity market capitalization
multiples for the Public Companies were as follows: based upon the ratios of
debt to Total Market Capitalization, a range of 10% to 74%, with a mean of
41%, for the Public Companies, versus 42% for Bradley after the Merger; based
upon 1996 estimated dividend payout ratios, a range of 63% to 93%, with a mean
of 82%, for the Public Companies, versus 75% for Bradley after the Merger
(assuming no synergies); and, based upon 1996 estimated FFO multiples, a
range of 6.2x to 13.9x, with a mean of 9.4x, for the Public Companies, versus
8.5x for Bradley after the Merger (assuming no synergies).
Stock Trading History. Alex. Brown also reviewed the history of the
trading prices and volume for Bradley Common Stock and Tucker Common Stock for
the period commencing October 27, 1994 through October 27, 1995. In addition,
Alex. Brown noted the distribution of Tucker trading volume by price range for
that period. Alex. Brown reviewed the historic exchange ratio between the
Bradley Common Stock and the Tucker Common Stock since Tucker's initial public
offering. Each of these analyses reflected the general decline in Tucker's
stock price throughout the period.
No transaction or company used in the Selected Transactions Analysis or
the Selected Public Companies Analysis is identical to the Merger, Bradley or
Tucker. Accordingly, such analyses must take into account differences in the
financial and operating characteristics of the companies considered in the
Selected Transactions Analysis and the Selected Public Companies Analysis and
other factors that could affect the acquisition value and public trading value
of the Selected Transactions and Public Companies, respectively.
While the foregoing summary describes all material analyses and factors
in the Alex. Brown Report, it is not a comprehensive description of all
analyses and factors considered by Alex. Brown. The preparation of a fairness
opinion is a complex process that involves determination of the most
appropriate and relevant methods of financial analysis and the application of
these methods to the particular circumstances and, therefore, such an opinion
is not readily susceptible to summary description. Alex. Brown believes that
its analyses and summary set forth above must be considered as a whole and
that selecting portions of its analyses, without considering all analyses, or
selecting portions of the foregoing summary, without considering all factors
and analyses, would create an incomplete view of the process underlying the
analyses performed and factors considered as set forth in its opinion and the
Alex. Brown Report. In performing its analyses, Alex. Brown considered general
economic, market and financial conditions and other matters, many of which are
beyond the
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control of Bradley and Tucker. The analyses performed by Alex. Brown are not
necessarily indicative of actual values or future results, which may be
significantly more or less favorable than those suggested by such analyses.
Accordingly, such analyses and estimates are inherently subject to substantial
uncertainty. Additionally, analyses relating to the value of a business do not
purport to be appraisals or to reflect the prices at which the business
actually may be sold. Furthermore, Alex. Brown has expressed no opinion as to
the prices at which shares of Bradley Common Stock may trade at any future
time.
Pursuant to the letter agreement dated September 15, 1995, between
Bradley and Alex. Brown, if the Merger is consummated, Bradley has agreed to
pay Alex. Brown a fee ("Financial Advisory Fee") of $500,000 for acting as its
financial advisor in connection with the Merger. Bradley also has agreed to
pay Alex. Brown $300,000 for rendering its opinion, which will be credited
against any Financial Advisory Fee. In addition, Bradley has agreed to pay
Alex. Brown $100,000 for each additional fairness opinion requested in
connection with any material amendments or revisions to the Merger Agreement.
Bradley also has agreed to reimburse Alex. Brown for its reasonable out-of-
pocket expenses (not exceeding $50,000) incurred in connection with rendering
financial advisory services, including fees and disbursements of its legal
counsel. Bradley has agreed to indemnify Alex. Brown and its directors,
officers, agents, employees and controlling persons, for certain costs,
expenses, losses, claims, damages and liabilities related to or arising out of
its rendering of services under its engagement as financial advisor.
The Board of Directors of Bradley retained Alex. Brown to act as its
financial advisor based upon Alex. Brown's qualifications, reputation,
experience and expertise, particularly with respect to REITs and other real
estate companies. Alex. Brown is an internationally recognized investment
banking firm and, as a customary part of its investment banking business, is
engaged in the valuation of businesses and their securities in connection with
mergers and acquisitions, negotiated underwritings, private placements and
valuations for corporate and other purposes. Alex. Brown may actively trade
the equity securities of Bradley and Tucker for its own account and for the
account of its customers and accordingly may at any time hold a long or short
position in such securities. In addition, Alex. Brown has acted as a co-
managing underwriter of the July Offering of Bradley Common Stock. Alex.
Brown regularly publishes research reports regarding the real estate industry
and the businesses and securities of Bradley and other publicly-traded
companies in the real estate industry.
INTERESTS OF CERTAIN OFFICERS AND DIRECTORS OF TUCKER
In considering the recommendation of the Boards of Directors of Tucker
and Bradley to approve the Merger and the Merger Agreement, stockholders
should be aware that certain members of the management and the Board of
Directors of Tucker have certain interests in, and will receive benefits from,
the Merger that are separate from the interests of, and benefits to,
stockholders of Tucker generally.
Severance Plan. In connection with the execution of the Merger Agreement,
Tucker adopted the Severance Plan which Bradley has agreed to assume and be
bound by after the Effective Time. Pursuant to the terms of the Severance
Plan, all employees of Tucker and its affiliates whose employment terminates
under certain specified conditions prior to December 31, 1996 will be entitled
to receive a severance payment equal to six weeks' base salary plus an
additional two weeks' base salary for each full year of regular full-time
employment with Tucker, its predecessors and their respective affiliates
(including TTC), up to a maximum of twice the employee's annual compensation
for the calendar year immediately prior to the employee's termination of
employment.
Severance and Consulting Agreements. In connection with the execution of
the Merger Agreement, Tucker has entered into agreements with the following
employees: Kenneth Tucker, Richard Tucker, Harold Eisenberg, Lawrence Tucker,
Norris Eber and William Karnes. Bradley has agreed to assume and be bound by
each of these agreements after the Effective Time. These agreements are in
place of, and not in addition to, what such employees would otherwise receive
under the Severance Plan.
The severance agreement with Kenneth Tucker entitles Mr. Tucker to
receive a severance payment of $225,000 if his employment is terminated under
certain specified conditions prior to December 31, 1996 or if he is still
employed by Tucker as of the Effective Time. In addition, if Mr. Tucker's
employment is terminated
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under certain specified conditions prior to December 31, 1996, he is entitled
to receive (i) twelve months of continued health care coverage for himself and
his dependents following termination of employment, and (ii) car rental
payments through April 1996. The severance agreement also entitles Mr. Tucker
to purchase his existing office furniture at its fair market value and to
exercise any purchase option provided in the current car rental agreement if
his employment is terminated under certain specified conditions prior to
December 31, 1996. In consideration of the foregoing, Mr. Tucker has agreed,
among other things, to waive all of his rights under a lease of art previously
entered into between Mr. Tucker and Tucker and to transfer to the Surviving
Company title to each of the artworks covered by the lease.
Individual severance agreements with Richard Tucker, Harold Eisenberg and
Lawrence Tucker provide that if the employee's employment is terminated under
certain specified conditions prior to December 31, 1996, he will be entitled
to receive (i) a severance payment of $123,000, $122,000 and $58,000,
respectively, and (ii) twelve months of continued health care coverage
following termination of employment. Richard Tucker's severance agreement
also entitles him to purchase his existing office furniture at its fair market
value if his employment is terminated under certain circumstances prior to
December 31, 1996.
Norris Eber's agreement provides that he will receive (i) $139,000 if he
is still employed by Tucker as of the Effective Time, and (ii) a severance
payment of $61,000 and twelve months of continued health care coverage if his
employment is terminated under certain specified conditions prior to December
31, 1996.
The severance agreement with William Karnes provides that he will receive
twelve months of continued health care coverage following termination of
employment if his employment is terminated under certain specified conditions
prior to December 31, 1996. Tucker previously entered into an employment
agreement with Mr. Karnes pursuant to which he will receive a severance
payment equal to twelve months' base salary (currently $210,000) if his
employment is terminated under certain conditions.
Bradley also has entered into a three-year consulting agreement with
Kenneth Tucker, effective as of the Effective Time, pursuant to which Mr.
Tucker will receive an annual consulting fee of $135,000, which shall be paid
on the date of the Merger, the first anniversary of the Merger and the second
anniversary of the Merger. Pursuant to such consulting agreement, Mr. Tucker
will consult with and advise Bradley on various retail real estate matters as
requested by Bradley, provided that he is not required to devote more than ten
hours per month to the performance of such consulting services. The consulting
agreement also provides that Mr. Tucker will be reimbursed for reasonable
business expenses incurred by him in performing his consulting services.
Indemnification. Pursuant to the terms of the Merger Agreement, Bradley
has agreed to provide the directors, officers, employees, advisors and agents
of Tucker and each of its subsidiaries with all rights to indemnification or
exculpation existing under their respective charters or bylaws in effect as of
the date of the Merger Agreement with respect to matters occurring at or prior
to the Effective Time, and to provide such persons with certain
indemnification rights under the Bradley Charter and the Bradley Bylaws.
Bradley has also agreed to purchase, at or prior to the Effective Time,
liability insurance coverage for Tucker's directors and officers for a period
of six years which will provide the directors and officers with $10,000,000 of
aggregate coverage. In addition, Bradley has agreed to adopt certain
amendments to Tucker's existing indemnification agreements with its directors.
See "The Merger Agreement--Indemnification."
Amended TOP Partnership Agreement and Transfer of Interests in TMC. In
connection with the execution of the Merger Agreement, Bradley, Tucker and
certain of the limited partners of TOP, including the Management Directors,
agreed to an amendment and restatement of the TOP Partnership Agreement,
which, among other things, limits in certain respects the environmental
indemnification obligations of the Management Directors under the TOP
Partnership Agreement and grants to the limited partners certain registration
rights with respect to shares of Bradley Common Stock which they may receive
upon redemption of TOP Units. See "The Merger Agreement--Amended TOP
Partnership Agreement." In addition, in connection with the execution of the
Merger Agreement, Kenneth and Richard Tucker have agreed to transfer their
equity interests in TMC to two individuals who are officers of Bradley for
$500 at or prior to the Effective Time. See "The Merger Agreement--Transfer
of Interests in TMC."
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CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a general summary of certain material United States
federal income tax consequences of the Merger to Bradley, Tucker and their
respective U.S. stockholders. The following discussion is based upon current
provisions of the Code, existing, temporary and final regulations thereunder
and current administrative rulings and court decisions, all of which are
subject to change, possibly on a retroactive basis. No attempt has been made
to comment on all United States federal income tax consequences of the Merger
that may be relevant to stockholders of Bradley or Tucker. The tax discussion
set forth below is included for general information only. It is not intended
to be, nor should be construed to be, legal or tax advice to a particular
stockholder of Bradley or Tucker.
THE FOLLOWING DISCUSSION MAY NOT APPLY TO PARTICULAR CATEGORIES OF
HOLDERS OF SHARES OF TUCKER COMMON STOCK OR BRADLEY COMMON STOCK SUBJECT TO
SPECIAL TREATMENT UNDER THE CODE, SUCH AS FOREIGN HOLDERS AND HOLDERS WHOSE
SHARES WERE ACQUIRED PURSUANT TO THE EXERCISE OF AN EMPLOYEE STOCK OPTION OR
OTHERWISE AS COMPENSATION. TUCKER AND BRADLEY STOCKHOLDERS ARE URGED TO
CONSULT THEIR TAX ADVISORS TO DETERMINE THE SPECIFIC TAX CONSEQUENCES OF THE
MERGER, INCLUDING ANY STATE, LOCAL OR OTHER TAX CONSEQUENCES OF THE MERGER.
Tax Consequences of the Merger
Mayer, Brown & Platt, counsel for Tucker, has delivered its opinion to
Tucker substantially to the effect that, on the basis of facts,
representations and assumptions set forth in such opinion, the Merger will be
treated for United States federal income tax purposes as a reorganization
within the meaning of Section 368(a)(1)(A) of the Code. Accordingly, (i) no
gain or loss will be recognized by Tucker as a result of the Merger, and (ii)
no gain or loss will be recognized by a stockholder of Tucker who receives
Bradley Common Stock in exchange for Tucker Common Stock (except with respect
to any cash received in lieu of a fractional interest in Bradley Common
Stock). Goodwin, Procter & Hoar, counsel for Bradley, has delivered its
opinion to Bradley substantially to the effect that, on the basis of facts,
representations and assumptions set forth in such opinion, the Merger will be
treated for United States federal income tax purposes as a reorganization
within the meaning of Section 368(a)(1)(A) of the Code. Accordingly, no gain
or loss will be recognized by Bradley as result of the Merger. These opinions
are based, in part, upon a representation by the management of Tucker to the
effect that, to the best knowledge of Tucker's management, there is no plan or
intention on the part of the stockholders of Tucker to dispose of a number of
shares of Bradley Common Stock received in the Merger that would reduce the
Tucker stockholders' ownership of Bradley Common Stock to the number of shares
having a value of less than 50 percent of the value of the Tucker Common Stock
as of the date of the Merger and upon counsel's assumption to the effect that
such representation is correct as if made without such "best knowledge"
qualification. The opinions referred to above have been filed as Exhibits to
the Registration Statement on Form S-4 (the "Registration Statement") of which
this Joint Proxy Statement/Prospectus is a part.
The aggregate tax basis of the Bradley Common Stock to be received by
stockholders of Tucker in connection with the Merger will be the same as the
aggregate tax basis in the Tucker Common Stock surrendered in exchange
therefor (reduced by any amount allocable to a fractional share interest for
which cash is received), and the holding period of the Bradley Common Stock to
be received by the stockholders of Tucker in connection with the Merger will
include the holding period for the Tucker Common Stock surrendered in exchange
therefor, provided that the Tucker Common Stock is held as a capital asset at
the Effective Time.
Cash received in lieu of a fractional share of Bradley Common Stock will
be treated as received in redemption for such fractional interest, and gain or
loss will be recognized, measured by the difference between the amount of cash
received and the portion of the basis of the shares of Tucker Common Stock
allocable to such fractional interest. Such gain or loss will constitute
capital gain or loss from the sale of stock if the stockholder holds its
Tucker Common Stock as a capital asset at the Effective Time, and will be
long-term capital gain or loss if the holding period for such shares of Tucker
Common Stock was greater than one year at the Effective Time.
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Pre-Merger Dividend
The Merger Agreement requires that Tucker distribute to its stockholders
immediately prior to the Merger any undistributed "real estate investment
trust taxable income" or "earnings and profits" of Tucker for Tucker's short
taxable year ending with the Merger, plus any amounts necessary for Tucker to
satisfy the REIT distribution requirements for such short taxable year. See
"Risk Factors--Adverse Consequences of Failure to Qualify as a REIT." The
Merger Agreement requires that Bradley distribute to its stockholders an
amount per share equal to (i) the amount per share of any pre-Merger dividends
paid by Tucker as described in the preceding sentence divided by (ii) the
Exchange Ratio. Any such distributions of Bradley and Tucker are referred to
herein as "Pre-Merger Dividends." Neither Tucker nor Bradley anticipates that
such Pre-Merger Dividends (if any) would be designated as capital gain
dividends. Accordingly, (i) any Pre-Merger Dividends made to Tucker's taxable
U.S. stockholders out of Tucker's current or accumulated earnings and profits
would be taken into account by such U.S. stockholders as ordinary income and
would not be eligible for the dividends received deduction generally available
for corporations and (ii) any Pre-Merger Dividends made to Bradley's taxable
U.S. stockholders out of Bradley's current or accumulated earnings and profits
also would be taken into account by such U.S. stockholders as ordinary income
and would not be eligible for the dividends received deduction generally
available to corporations. Any Pre-Merger Dividends in excess of current and
accumulated earnings and profits of Tucker (in the case of any Tucker Pre-
Merger Dividends) or Bradley (in the case of any Bradley Pre-Merger Dividends)
would not be taxable to the stockholder to the extent that such distribution
does not exceed the adjusted basis of the stockholder's stock with respect to
which the distribution is made, but rather would reduce the adjusted basis of
such stock. To the extent that any such Pre-Merger Dividend in excess of
earnings and profits exceeds the adjusted basis of the stockholder's stock,
such distribution would be included in the stockholder's income as long-term
capital gain (or short-term capital gain if the stock has been held for one
year or less) assuming the stockholder holds the stock as a capital asset at
the time of the Merger.
Tax Aspects of Bradley's Investment in TOP
Tucker holds substantially all its assets through TOP and TOP's
subsidiary partnerships, and, as a result of the Merger, Bradley will acquire
Tucker's general partner interest in TOP. Bradley's interest in TOP and
Bradley's indirect interests in the subsidiary partnerships of TOP (referred
to collectively as the "Subsidiary Partnerships"), including TFP, involve
special tax considerations, including those described below.
Tax Aspects of the Merger. As a result of the Merger, for federal income
tax purposes TOP and certain of the Subsidiary Partnerships will be deemed to
have liquidated and distributed their assets to their partners immediately
after the Merger (including Bradley). The partners of such partnerships
immediately after the Merger (including Bradley) will be deemed to have
contributed the assets of each such partnership to a new partnership. Neither
Bradley nor Tucker should recognize income as a result of such constructive
liquidation-contribution. Such constructive liquidation-contribution will,
however, subject Bradley to certain rules which, under certain circumstances,
could require Bradley to recognize a portion of the gain (or loss) inherent in
the Tucker properties (individually and in the aggregate) at the time of the
Merger if TOP or a Subsidiary Partnership distributes property (other than
money) to its partners within the five year period following the Merger. Such
constructive liquidation-contribution could have additional consequences, such
as changes in depreciation methods or recovery periods, but Tucker and Bradley
do not anticipate that such consequences will be material.
Bradley's Tax Basis in TOP. In general, Bradley's initial adjusted tax
basis in its interest in TOP will be equal to Tucker's adjusted tax basis in
Tucker's interest in TOP immediately prior to the Merger, reduced by any
actual or deemed cash distributions made to Tucker in connection with the
Merger, plus or minus any net increase or decrease, respectively, in Bradley's
share of the liabilities of TOP, as calculated immediately after consummation
of the Merger. In general, after the Merger, Bradley's adjusted tax basis in
TOP will be (i) increased by (a) the amount of any additional capital
contributions made by Bradley to TOP, (b) Bradley's allocable share of TOP's
income, if any, and (c) any further increases in Bradley's allocable share of
the liabilities of TOP and (ii) decreased, but not below zero, by (x)
Bradley's allocable share of losses suffered by TOP, (y) the amount of cash
and the adjusted basis of any property distributed to Bradley and (z) any
decreases in Bradley's share of liabilities of TOP.
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Entity Classification. Each of TOP and the Subsidiary Partnerships is
intended to qualify as a partnership (as opposed to an association taxable as
a corporation) for federal income tax purposes. If any of TOP and the
Subsidiary Partnerships were treated as an association, it would be taxable as
a corporation and therefore subject to an entity-level tax on its income. In
such a situation, the character of Bradley's assets and items of income would
change, and Bradley likely would be unable to satisfy the asset and income
requirements for qualification as a REIT. In addition, any change in the
status of TOP or a Subsidiary Partnership for tax purposes might be treated as
a taxable event causing Bradley to incur a tax liability without any related
cash distributions. An organization such as TOP or a Subsidiary Partnership
formed as a partnership under state law will be treated as an association
taxable as a corporation for federal income tax purposes if it has more than
two of the four corporate characteristics that the Treasury Regulations use to
distinguish a partnership from a corporation. These four corporate
characteristics are (i) continuity of life, (ii) centralization of management,
(iii) limited liability and (iv) free transferability of interests. Although
neither Bradley nor Tucker has requested a ruling from the IRS or an opinion
of counsel regarding the status of TOP and the Subsidiary Partnerships as
partnerships as of the Merger, Bradley and Tucker believe that neither TOP nor
any of the Subsidiary Partnerships will possess more than two of the four
corporate characteristics and that as a result each such partnership will be
treated as a partnership for federal income tax purposes.
Notwithstanding the status of TOP and the Subsidiary Partnerships as
partnerships rather than associations taxable as corporations, the IRS could
allege that TOP or a Subsidiary Partnership is a "publicly- traded
partnership" under Section 7704 of the Code. If such an assertion were
successfully made, such partnership would be subject to tax as a corporation
under the Code unless certain conditions regarding the nature of its income
were satisfied. A partnership is a publicly-traded partnership if interests
in such partnership are either traded on an established securities market or
are "readily tradable on a secondary market (or the substantial equivalent
thereof)." A publicly-traded partnership is not taxed as a corporation,
however, if at least 90% of its gross income for each taxable year consists of
certain passive income, including interest, dividends, real property rents,
and gains from the sale or other disposition of real property. This exemption
is referred to herein as the "qualifying income exemption."
In 1988, the IRS issued a notice (the "Notice") providing limited safe
harbors from the definition of a publicly-traded partnership in advance of the
issuance of Treasury Regulations. Pursuant to one of those safe harbors (the
"Private Placement Exclusion"), interests in a partnership will not be treated
as readily tradable on a secondary market or the substantial equivalent
thereof if (i) all of the partnership interests are issued in a transaction
that is not registered under the Securities Act, and (ii) the partnership does
not have more than 500 partners (taking into account as a partner each person
who indirectly owns an interest in the partnership through a partnership, a
grantor trust or an S corporation).
The U.S. Department of the Treasury recently issued final regulations
(the "PTP Regulations") that modify the Private Placement Exclusion under the
Notice in three respects. First, the PTP Regulations provide that the Private
Placement Exclusion applies only if the partnership does not have more than
100 partners at any time during its taxable year. Second, a person who
indirectly owns an interest in the partnership through another partnership, a
grantor trust or an S corporation (each a "flow-through entity") is treated as
a partner of the partnership only if (i) substantially all of the value of
such person's interest in the flow-through entity is attributable to the flow-
through entity's interest in the partnership and (ii) a principal purpose of
the use of the tiered arrangement is to permit the partnership to satisfy the
100 partner limitation. Third, the PTP Regulations provide that the Private
Placement Exclusion will apply only if any interest in the partnership offered
and sold outside the United States would not be subject to registration under
the Securities Act if such interest were sold within the United States. The
PTP Regulations will apply to TOP for taxable years beginning on or after
December 31, 2005 or such earlier time that TOP adds a substantial new line of
business.
Interests in TOP or a Subsidiary Partnership have not been traded on an
established securities market. Moreover, Tucker believes that, for periods
ending on or before the Merger, TOP and each Subsidiary Partnership has
qualified and will qualify for the Private Placement Exclusion under the
Notice and also has not had and will not have more than 100 partners as
determined under the PTP Regulations. In addition, Bradley anticipates that,
following the Merger, TOP and each Subsidiary Partnership will satisfy the
Private Placement Exclusion (as set forth in the Notice or as modified by the
PTP Regulations, whichever applies) and/or will be eligible for the qualifying
income exemption and that none of such partnerships will be treated as a
publicly-
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traded partnership. There can be no assurance, however, that efforts to avoid
publicly-traded partnership status will be successful.
Tax Aspects of Bradley's Investment in TOP. For purposes of the various
REIT asset and income tests, Bradley will include as part of its assets and
income Bradley's proportionate share (based on Bradley's capital interests in
TOP and the Subsidiary Partnerships) of the assets and items of income, gain,
loss and deduction of TOP and the Subsidiary Partnerships. Bradley will
include in the computation of its taxable income Bradley's allocable share
(taking into account allocations under Section 704(c) of the Code as described
below) of income and loss of TOP and the Subsidiary Partnerships.
Allocations with Respect to Contributed or Revalued Property. Pursuant
to Section 704(c) of the Code, income, gain, loss and deduction attributable
to appreciated or depreciated property that is contributed to a partnership in
exchange for an interest in the partnership must be allocated in a manner such
that for federal income tax purposes the contributing partner is charged with,
or benefits from, respectively, the unrealized gain or unrealized loss
associated with the property at the time of the contribution. The amount of
such unrealized gain or unrealized loss generally equals the difference
between the fair market value of the contributed property at the time of
contribution and the adjusted tax basis of such property at the time of
contribution (a "Book-Tax Difference"). Such allocations are solely for
federal income tax purposes and do not affect the book capital accounts or
other economic or legal arrangements among the partners. Under Treasury
Regulations promulgated under Section 704(b) of the Code, similar rules apply
when a partnership elects to "revalue" its assets in certain situations, such
as when a contribution of property is made to a partnership by a new partner.
As noted above, as a result of the Merger, for federal income tax purposes TOP
will be deemed to have liquidated and distributed its assets to its partners
immediately following the Merger (including Bradley). The partners of TOP
immediately following the Merger (including Bradley) will be treated as
contributing their proportionate share of the assets of TOP (subject to
liabilities) to a new partnership in a transaction governed by Section 704(c)
of the Code. The Amended TOP Partnership Agreement will require that income,
gain, loss and deduction attributable to contributed property with a Book-Tax
Difference must be allocated in accordance with Section 704(c) of the Code.
Such partnership agreement also will contain a similar provision for any Book-
Tax Differences arising from a revaluation of partnership assets, which may
occur in the future.
Based on the foregoing, in general, if any asset of TOP is determined to
have a fair market value at the time of the Merger which is greater than its
then-adjusted tax basis, certain partners of TOP will be allocated lower
amounts of depreciation deductions for tax purposes by TOP and increased
taxable income and gain on sale. Such allocations will tend to eliminate the
Book-Tax Difference over the life of TOP. However, the special allocation
rules of Section 704(c) of the Code do not always entirely rectify Book-Tax
Differences on an annual basis or with respect to a specific transaction such
as a sale. Thus, Bradley may be allocated lower depreciation and other
deductions, and possibly amounts of taxable income in the event of a sale of
such contributed assets in excess of the economic or book income allocated to
it as a result of such sale. This may cause Bradley to recognize taxable
income in excess of cash proceeds, which might adversely affect Bradley's
ability to comply with the distribution requirements for REITs.
Correspondingly, if any asset of TOP is determined to have a fair market value
at the time of the Merger which is less than its then-adjusted tax basis,
certain partners of TOP will be allocated higher amounts of depreciation
deductions for tax purposes and increased taxable deductions and loss on sale
by TOP.
Treasury Regulations under Section 704(c) of the Code were recently
issued in final form providing partnerships with a choice of different methods
of accounting for Book-Tax Differences. Bradley has not yet determined which
of the alternate methods of accounting for Book-Tax Differences will be
elected by TOP. Such determination could have different timing and other
effects on the taxable income of Bradley.
These same rules will govern tax allocations with respect to contributed
or revalued property of the Subsidiary Partnerships following the Merger,
including property deemed contributed to certain of the Subsidiary
Partnerships in connection with the deemed liquidation-contribution with
respect to certain Subsidiary Partnerships resulting from the Merger as
described above.
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Qualification of Bradley as a REIT Following the Merger
General. If certain detailed conditions imposed by the REIT provisions
of the Code are met, entities, such as Bradley and Tucker, that invest
primarily in real estate and that otherwise would be treated for federal
income tax purposes as corporations, are generally not taxed at the corporate
level on their "real estate investment trust taxable income" that is currently
distributed to stockholders. This treatment substantially eliminates the
"double taxation" on earnings (i.e., at both the corporate and stockholder
---
levels) that generally results from the use of corporations. Prior to the
consummation of the Merger, Bradley and Tucker have been and will continue to
be operated in a manner intended to allow each of them to qualify as a REIT.
Bradley intends to operate following the Merger in a manner so that Bradley
will continue to qualify as a REIT. If Bradley fails to qualify as a REIT in
any taxable year, Bradley will be subject to federal income taxation as if it
were a domestic corporation, and Bradley's stockholders will be taxed in the
same manner as stockholders of ordinary corporations. In this event, Bradley
could be subject to potentially significant tax liabilities, and the amount of
cash available for distribution to stockholders would be reduced and possibly
eliminated.
Bradley's qualification and taxation as a REIT following the Merger will
depend upon Bradley's continuing ability to meet, through actual operating
results, the income and asset requirements, distribution levels, diversity of
stock ownership and other requirements for qualification as a REIT under the
Code. Counsel will not review compliance with these tests on a continuing
basis. No assurance can be given that Bradley will satisfy such tests on a
continuing basis. Moreover, Bradley's ability to qualify as a REIT following
the Merger will depend on the qualification of Bradley as a REIT for periods
prior to the Merger. Bradley's continued qualification as a REIT following
the Merger also could depend on Tucker's qualification as a REIT for periods
through the Merger if the IRS subsequently determined that Tucker had earnings
and profits as determined for federal income tax purposes at the time of the
Merger (notwithstanding the requirement in the Merger Agreement that Tucker
distribute all earnings and profits prior to the Merger) or if former
stockholders of Tucker acquired 50% or more in value of the shares of Bradley
Common Stock as a result of or following the Merger. See "Risk Factors--
Adverse Consequences of Failure to Qualify as a REIT." In connection with the
Merger, Goodwin, Procter & Hoar, or another nationally recognized law firm
selected by Bradley, will render an opinion regarding Bradley's qualification
as a REIT for periods prior to the Merger. Mayer, Brown & Platt, or another
nationally recognized law firm selected by Tucker, will render an opinion
regarding Tucker's qualification as a REIT for the taxable year ended December
31, 1995 and for the short tax year ending at the date of the Closing.
Coopers & Lybrand L.L.P. will render an opinion regarding Tucker's
qualification as a REIT for the taxable years ended December 31, 1993 and
December 31, 1994. Such opinions will be based on representations from
management regarding Tucker's and Bradley's compliance with the requirements
for qualification as a REIT and are not binding on the IRS. Accordingly, no
assurance can be given that the IRS could not challenge the status of Bradley
as a REIT following the Merger.
Tucker Management Corp. The assets of TOP include 8% of the voting stock
and 95% of the non-voting stock of TMC. TMC will not qualify as a REIT or as
a qualified REIT subsidiary and will pay federal, state and local tax on its
taxable income at normal corporate rates. By virtue of Bradley's ownership of
TOP Units following the Merger, Bradley will be considered to own its pro rata
share of the nonvoting and voting stock of TMC owned by TOP. In order for
Bradley to qualify as a REIT (i) the value of TMC stock owned by Bradley
through TOP may not exceed 5% of the value of Bradley's total assets and (ii)
Bradley may not own more than 10% of the voting securities of TMC. In
connection with the consummation of the Merger, Kenneth and Richard Tucker
have agreed to transfer their respective shares in TMC consisting,
collectively, of 5% of the outstanding preferred stock and 92% of the common
stock to two officers of Bradley. As a result, neither Bradley nor TOP will
own more than 8% of the voting securities of TMC. In addition, Bradley does
not believe that Bradley's pro rata share of the value of the securities of
TMC will exceed 5% of the value of the total assets of Bradley.
ACCOUNTING TREATMENT
Bradley will account for the Merger as a purchase in accordance with
Accounting Principles Board Opinion No. 16. Purchase accounting for a
combination is similar to the accounting treatment used in the acquisition of
any asset group. The fair market value of the consideration (cash, stock,
debt securities, etc.) given by the acquiring firm is used as the valuation
basis for the combination. The assets and liabilities of the
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acquired firm are revalued to their respective fair market values at the
combination date. The financial statements of the acquiring company reflect
the combined operations from the date of combination.
REGULATORY APPROVAL
Tucker and Bradley believe that the Merger may be consummated without
notification being given or certain information being furnished to the Federal
Trade Commission (the "FTC") or the Antitrust Division of the Department of
Justice (the "Antitrust Division") pursuant to the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), and that no waiting
period requirements under the HSR Act are applicable to the Merger. However,
there can be no assurance that the consummation of the Merger will not be
delayed by reason of the HSR Act. At any time before or after consummation of
the Merger, the Antitrust Division or the FTC could take such action under the
antitrust laws as it deems necessary or desirable in the public interest,
including seeking to enjoin the consummation of the Merger or seeking
divestiture of substantial assets of Bradley or Tucker. At any time before or
after the Effective Time, any state could take such action under its own
antitrust laws as it deems necessary or desirable. Such action could include
seeking to enjoin the consummation of the Merger or seeking divestiture of
Tucker or assets of Bradley or Tucker by Bradley. Private parties may also
seek to take legal action under antitrust laws under certain circumstances.
CERTAIN RESALE RESTRICTIONS
All shares of Bradley Common Stock received by Tucker stockholders in the
Merger will be freely transferable, except that shares of Bradley Common Stock
received by persons who are deemed to be "affiliates" (as such term is defined
under the Securities Act) of Tucker at the time of the Tucker Special Meeting
may be resold by them only in transactions permitted by the resale provision
of Rule 145 promulgated under the Securities Act (or Rule 144 in the case of
such persons who become affiliates of Bradley) or as otherwise permitted under
the Securities Act. Persons who may be deemed to be affiliates of Bradley or
Tucker generally include individuals or entities that control, are controlled
by, or are under common control with, such party and may include certain
officers and directors of such party as well as principal stockholders of such
party. The Merger Agreement requires Tucker to exercise its reasonable best
efforts to cause each of its affiliates to execute a written agreement to the
effect that such person will not offer to sell, transfer or otherwise dispose
of any of the Bradley Common Stock issued to such person in or pursuant to the
Merger unless (i) such sale, transfer or other disposition has been registered
under the Securities Act; (ii) such sale, transfer or other disposition is
made in conformity with Rule 145 under the Securities Act; or (iii) in the
opinion of counsel, which opinion and counsel shall be reasonably satisfactory
to Bradley, such sale, transfer or other disposition is exempt from
registration under the Securities Act.
NEW YORK STOCK EXCHANGE LISTING
It is a condition to Tucker's and Bradley's obligations to consummate the
Merger that Bradley obtain the approval for the listing of the shares of
Bradley Common Stock issuable in the Merger on the NYSE, subject to official
notice of issuance. See "The Merger Agreement--Conditions to the Merger."
DISSENTERS' RIGHTS
Under the MGCL, stockholders of Tucker and Bradley are not entitled to
dissenters' rights in connection with the Merger.
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THE MERGER AGREEMENT
GENERAL
The Merger Agreement provides for a business combination between Bradley
and Tucker in which Tucker would be merged with and into Bradley and the
holders of Tucker Common Stock would be issued shares of Bradley Common Stock
in a transaction intended to qualify as a purchase for accounting purposes and
as a tax-free reorganization for federal income tax purposes. The discussion
in this Joint Proxy Statement/Prospectus of the Merger Agreement and the
description of the principal terms of the Merger Agreement are subject to and
qualified in their entirety by reference to the Merger Agreement, a copy of
which is attached to this Joint Proxy Statement/Prospectus as Annex A and
which is incorporated herein by reference.
EFFECTIVE TIME OF THE MERGER
In accordance with the MGCL, the Merger will become effective upon the
acceptance for record of the Articles of Merger by the State Department of
Assessments and Taxation of Maryland. Subject to the fulfillment (or waiver)
of the other conditions to the obligations of Bradley and Tucker to consummate
the Merger, it is currently expected that the Merger will be consummated as
soon as practicable following the approval by the stockholders of Bradley and
Tucker of the Merger and the Merger Agreement at their respective Special
Meetings of Stockholders.
EXCHANGE OF TUCKER STOCK CERTIFICATES
Promptly after the Effective Time, Bradley will cause the Exchange Agent
to mail to each holder of record of a Certificate or Certificates (i) a letter
of transmittal which shall specify that delivery shall be effected, and risk
of loss and title to the Certificate shall pass, only upon delivery of the
Certificates to the Exchange Agent and (ii) instructions for use in effecting
the surrender of the Certificates in exchange for certificates representing
shares of Bradley Common Stock and cash in lieu of fractional shares. Upon
surrender of a Certificate for cancellation to the Exchange Agent, together
with such letter of transmittal, duly executed and completed in accordance
with the instructions thereto, the holder of such Certificate will be entitled
to receive in exchange therefor (x) a certificate representing the number of
whole shares of Bradley Common Stock to which such holder shall be entitled,
and (y) a check representing the amount of cash in lieu of fractional shares,
if any, plus the amount of any dividends or distributions, if any, pursuant to
the following paragraph after giving effect to any required withholding tax,
and the Certificate so surrendered will be canceled. TUCKER STOCKHOLDERS
SHOULD NOT SEND IN THEIR CERTIFICATES UNTIL THEY RECEIVE A LETTER OF
TRANSMITTAL.
No dividends or other distributions on Bradley Common Stock will be paid
with respect to any shares of Tucker Common Stock represented by a Certificate
until such Certificate is surrendered for exchange as provided above;
provided, however, that subject to the effect of applicable laws, following
surrender of any such Certificate, there will be paid to the holder of
certificates representing whole shares of Bradley Common Stock issued in
exchange therefor, without interest, (i) at the time of such surrender, the
amount of dividends or other distributions with a record date after the
Effective Time theretofore payable with respect to such whole shares of
Bradley Common Stock and not paid, less the amount of any applicable
withholding taxes which may be required thereon, and (ii) at the appropriate
payment date, the amount of any dividends or other distributions with a record
date after the Effective Time but prior to surrender and a payment date
subsequent to surrender payable with respect to such whole shares of Bradley
Common Stock, less the amount of any applicable withholding taxes which may be
required thereon.
No fractional shares of Bradley Common Stock will be issued in connection
with the Merger. Each holder of Tucker Common Stock otherwise entitled to a
fractional share of Bradley Common Stock will be paid, in lieu thereof, upon
surrender of a Certificate, an amount in cash (without interest), rounded to
the nearest cent, determined by multiplying the Closing Price by the fraction
of a share of Bradley Common Stock which such holder would otherwise be
entitled.
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At and after the Effective Time, there will be no transfers on the stock
transfer books of Tucker of the shares of Tucker Common Stock which were
outstanding immediately prior to the Effective Time.
Any portion of the monies from which cash payments in lieu of fractional
interests in shares of Bradley Common Stock will be made (including the
proceeds of any investments thereof) and any shares of Bradley Common Stock
deposited for the benefit of the holders of shares of Tucker Common Stock that
are unclaimed by the former stockholders of Tucker one year after the
Effective Time will be delivered to the Surviving Company. Any former
stockholders of Tucker who have not complied with the exchange procedures
described above within one year after the Effective Time shall thereafter look
only to the Surviving Company for payment of their shares of Bradley Common
Stock and cash in lieu of fractional shares (plus dividends and distributions
to the extent set forth in the Merger Agreement), as determined pursuant to
the Merger Agreement, without any interest thereon. None of Tucker, Bradley,
the Exchange Agent or any other person will be liable to any former holder of
shares of Tucker Common Stock for any amount properly delivered to a public
official pursuant to applicable abandoned property, escheat or similar laws.
No interest will be paid or accrued on cash in lieu of fractional shares
or on any dividend or distribution, payable to holders of Certificates.
In the event any Certificate has been lost, stolen or destroyed, upon the
making of an affidavit of that fact by the person claiming such Certificate to
be lost, stolen or destroyed and, if required by the Surviving Company, the
posting by such person of a bond in such reasonable amount as the Surviving
Company may direct as indemnity against any claim that may be made against it
with respect to such Certificate, the Exchange Agent or the Surviving Company
will issue in exchange for such lost, stolen or destroyed Certificate the
shares of Bradley Common Stock and cash in lieu of fractional shares (plus, to
the extent applicable, dividends and distributions payable pursuant to the
terms of the Merger Agreement).
At the Effective Time, Tucker's obligations with respect to each
outstanding option to acquire Tucker Common Stock (the "Existing Tucker
Options") will be assumed by Bradley, subject to the provision that the
Existing Tucker Options will continue to have, and be subject to, the same
terms and conditions as set forth in the stock option plans and agreements (as
in effect immediately prior to the Effective Time) pursuant to which such
Existing Tucker Options were issued, except that (i) each option will be
exercisable for that number of whole shares of Bradley Common Stock equal to
the product of the number of shares of Tucker Common Stock covered by such
option immediately prior to the Effective Time multiplied by the Exchange
Ratio and rounded to the nearest whole number of shares of Bradley Common
Stock and (ii) the exercise price per share of Bradley Common Stock under such
option will be equal to the exercise price per share of Tucker Common Stock
under the Existing Tucker Option divided by the Exchange Ratio and rounded to
the nearest cent.
CONDITIONS TO THE MERGER
The respective obligations of Bradley and Tucker to effect the Merger and
the other transactions contemplated in the Merger Agreement are subject to the
fulfillment or waiver of each of the following conditions at or prior to the
Effective Time: (i) the Merger and the Merger Agreement shall have been
approved by the requisite vote of stockholders of Tucker and Bradley; (ii) the
waiting period applicable to the consummation of the Merger under the HSR Act,
if applicable, shall have expired or been terminated; (iii) neither Bradley
nor Tucker shall be subject to any order, ruling or injunction of a court of
competent jurisdiction which prohibits the consummation of the transactions
contemplated by the Merger Agreement; (iv) the Registration Statement shall
have been declared effective by the Commission under the Securities Act, and
no stop order suspending the effectiveness of the Registration Statement shall
have been issued by the Commission and no proceedings for that purpose shall
have been initiated or, to the knowledge of Bradley or Tucker, threatened by
the Commission; (v) Bradley shall have obtained the approval for the listing
of the shares of Bradley Common Stock issuable in the Merger on the NYSE,
subject to official notice of issuance; and (vi) all consents, authorizations,
orders and approvals of (or filings or registrations with) any governmental
commission, board, other regulatory body or third parties required to be made
or obtained in connection with the execution, delivery and performance of the
Merger Agreement and the ancillary agreements to the Merger Agreement shall
have been obtained or made (except where the failure to obtain or make any
such consent, authorization, order, approval, filing or registration would not
have a Tucker Material Adverse Effect (as
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defined below) or a Bradley Material Adverse Effect (as defined below), as the
case may be) including, without limitation, the Tucker REMIC Consent and the
consent of each of the lenders under Bradley's and Tucker's credit agreements.
The obligations of each of Tucker and Bradley to effect the Merger are
also subject to the fulfillment or waiver by the other party, at or prior to
the Closing Date, of the following conditions: (i) the representations and
warranties of the other party contained in the Merger Agreement shall be true
and correct in all material respects as of the Effective Time; (ii) the other
party shall have performed or complied in all material respects with all
agreements and covenants required by the Merger Agreement to be performed or
complied with by it on or prior to the Effective Time; and (iii) each party
shall have received the opinion of its tax counsel, dated no less than five
days prior to the date the Registration Statement is declared effective by the
Commission, to the effect that the Merger will be treated for federal income
tax purposes as a tax-free reorganization qualifying under the provisions of
Section 368(a)(1)(A) of the Code, which opinion shall not have been withdrawn
or modified in any material respect.
The obligation of Tucker to effect the Merger and the other transactions
contemplated therein is also subject to the fulfillment or waiver of the
following conditions at or prior to the Effective Time: (i) Tucker shall have
received an opinion from Goodwin, Procter & Hoar, or another nationally
recognized law firm selected by Bradley, to the effect that, for all
applicable tax years for which Bradley's federal income tax returns are
subject to audit and Bradley is subject to assessment for taxes reportable
therein and through the Closing Date, Bradley has qualified to be taxed as a
REIT under Sections 856 through 860 of the Code and (ii) from the date of the
Merger Agreement through the Effective Time, there shall not have occurred any
change concerning Bradley or any of its subsidiaries that has had or could be
reasonably likely to have a material adverse effect on the business, results
of operations or financial condition of Bradley and its subsidiaries taken as
a whole (a "Bradley Material Adverse Effect").
The obligation of Bradley to effect the Merger is also subject to the
fulfillment or waiver at or prior to the Closing Date of the following
conditions: (a) at the closing of the Merger, Bradley shall have received (i)
the opinion of Mayer, Brown & Platt, or another nationally recognized law firm
selected by Tucker, to the effect that, for the taxable year ended December
31, 1995 and for the short taxable year ending on the Closing Date, Tucker has
qualified to be taxed as a REIT under Sections 856 through 860 of the Code and
(ii) the opinion of Coopers & Lybrand L.L.P., independent public accountants
for Tucker, to the effect that for the taxable years ended December 31, 1993
and December 31, 1994, Tucker qualified to be taxed as a REIT under Sections
856 through 860 of the Code; (b) from the date of the Merger Agreement through
the Effective Time, there shall not have occurred any change concerning Tucker
or any of its subsidiaries, that has had or could be reasonably likely to have
a material adverse effect on the business, results of operations or financial
condition of Tucker and its subsidiaries taken as a whole (a "Tucker Material
Adverse Effect"); (c) Tucker shall have obtained and delivered to Bradley
estoppel certificates, dated no earlier than 45 days prior to the Effective
Time, with respect to (i) certain leases and agreements set forth in a
schedule to the Merger Agreement and (ii) leases representing a total of 50%
of the total rented space of each Tucker property, other than rented space
represented by the leases listed in the schedule referred to in (c)(i) above;
(d) Tucker and all of the limited partners of TOP shall have executed the
Amended TOP Partnership Agreement (see "--Amended TOP Partnership Agreement"),
and Kenneth and Richard Tucker shall have transferred all of their respective
equity interests in TMC to certain officers of Bradley; (e) Bradley shall have
obtained a letter from Coopers & Lybrand L.L.P., independent public
accountants for Tucker, certifying, among other things, that for federal
income tax purposes, Tucker will not have any accumulated or current earnings
or profits immediately prior to the Effective Time; and (f) Bradley shall have
received a private letter ruling from the IRS, in form and substance
reasonably satisfactory to Bradley, to the effect that following the
consummation of the Merger, each of TFC and TPI will qualify as a "qualified
REIT subsidiary" of Bradley under Section 856(i) of the Code.
REPRESENTATIONS AND WARRANTIES
The Merger Agreement contains various representations and warranties
relating to, among other things: (i) the due organization, power, authority
and standing of Bradley and Tucker and similar corporate matters; (ii) the
authorization, execution, delivery and enforceability of the Merger Agreement;
(iii) the capital structure of Bradley and Tucker; (iv) subsidiaries of
Bradley and Tucker; (v) investment interests of Bradley and Tucker;
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(vi) conflicts under charters or bylaws, violations of any instruments and
required consents or approvals; (vii) certain documents filed by each of
Bradley and Tucker with the Commission and the accuracy of information
contained therein; (viii) litigation; (ix) conduct of business in the ordinary
course and the absence of certain changes or material adverse effects; (x)
taxes; (xi) books and records; (xii) properties; (xiii) leases; (xiv) Tucker
rents; (xv) environmental matters; (xvi) employee benefit plans; (xvii) labor
matters; (xviii) brokers' and finders' fees with respect to the Merger; (xix)
receipt of fairness opinions; (xx) ownership of the capital stock in the other
company; (xxi) related party transactions; (xxii) contracts and commitments;
and (xxiii) the issuance of shares of Bradley Common Stock in the Merger.
CERTAIN COVENANTS
Except as specifically permitted by the Merger Agreement or upon written
consent of the other party, Bradley and Tucker have each agreed, among other
things, that it will, prior to the Effective Time: (i) use its reasonable
best efforts, and cause its subsidiaries to use their reasonable best efforts,
to preserve intact its business organization and goodwill and keep available
the services of its officers and employees; (ii) confer on a regular basis
with one or more representatives of the other to report operational matters of
materiality, subject to certain exceptions, and any proposals to engage in
material transactions; (iii) promptly notify the other of any material
emergency or other material change in the condition (financial or otherwise),
business, properties, assets, liabilities, prospects or the normal course of
its business or in the operation of its properties, any material governmental
complaints, investigations or hearings (or communications indicating that the
same may be contemplated), or the breach in any material respect of any
representation or warranty contained in the Merger Agreement; and (iv)
promptly deliver to the other true and correct copies of any report, statement
or schedule filed with the Commission subsequent to the date of the Merger
Agreement.
Unless Bradley has consented as provided in the Merger Agreement, Tucker
has agreed that, among other things, prior to the Effective Time, it (i)
shall, and shall cause each of its subsidiaries to, conduct its operations
according to its usual, regular and ordinary course in substantially the same
manner as previously conducted, subject to clauses (ii)-(xii) below; (ii)
shall not, and shall cause each of its subsidiaries not to, acquire, enter
into an option to acquire or exercise an option or contract to acquire
additional real property, incur additional indebtedness, encumber assets or
commence construction of, or enter into any agreement or commitment to develop
or construct, shopping centers or any other type of real estate projects,
except that (A) Tucker may incur additional indebtedness under the Amended and
Restated Revolving Credit Agreement dated as of June 27, 1994 among TOP,
Tucker and The First National Bank of Boston as agent and (B) Tucker may
extend the maturity of the current mortgage financing encumbering the Pavilion
at Mequon until June 30, 1996 upon the same terms and conditions which are
currently in effect for such financing; (iii) shall not amend the Tucker
Charter or the Tucker Bylaws, and shall cause each of its subsidiaries not to
amend its charter, bylaws, joint venture documents, partnership agreements or
equivalent documents except as contemplated by the Merger Agreement; (iv)
shall not (A) except pursuant to the exercise of options, warrants, conversion
rights and other contractual rights existing on the date of the Merger
Agreement and disclosed pursuant to the Merger Agreement, issue any shares of
its capital stock, effect any stock split, reverse stock split, stock
dividend, recapitalization or other similar transaction, (B) grant, confer or
award any option, warrant, conversion right or other right not existing on the
date of the Merger Agreement to acquire any shares of its capital stock, (C)
increase any compensation or enter into or amend any employment agreement with
any of its present or future officers or directors, or (D) adopt any new
employee benefit plan (including any stock option, stock benefit or stock
purchase plan), other than the Severance Plan and the agreements between
Tucker and each of Kenneth Tucker, Richard Tucker, Harold Eisenberg, Norris
Eber, Lawrence Tucker and William Karnes (collectively, the "Severance
Agreements"), or amend any existing employee benefit plan in any material
respect, except for changes which are less favorable to participants in such
plans (in connection with the foregoing, Tucker has agreed that (x) the
aggregate payments which may be paid after the date of the Merger Agreement
under the Tucker Property Manager Bonus Program shall not exceed $150,000 and
(y) Tucker shall award a maximum of $25,000 as bonus compensation for
employees who are not executive officers at or immediately prior to the
Effective Time); (v) shall not (A) declare, set aside or pay any dividend or
make any other distribution or payment with respect to any shares of its
capital stock, except a dividend not to exceed $.25 per share of Tucker Common
Stock for the fourth quarter of 1995 and thereafter until the Effective Time
and payment of the Pre-Merger Dividend, if necessary, or (B) except in
connection with the use of shares of capital stock to pay the exercise price
or tax withholding obligations in connection with the Tucker Stock Option
Plan, directly or
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indirectly redeem, purchase or otherwise acquire any shares of its capital
stock or capital stock of any of its subsidiaries, or make any commitment for
any such action; (vi) shall not, and shall not permit any of its subsidiaries
to, sell, lease or otherwise dispose of (A) any Tucker properties or any
portion thereof or any of the capital stock of or partnership or other
interests in any of its subsidiaries or (B) except in the ordinary course of
business, any of its other assets which are material, individually or in the
aggregate; (vii) shall not, and shall not permit any of its subsidiaries to,
make any loans, advances or capital contributions to, or investments in, any
other person; (viii) shall not, and shall not permit any of its subsidiaries
to, pay, discharge or satisfy any claims, liabilities or obligations
(absolute, accrued, asserted or unasserted, contingent or otherwise), other
than the payment, discharge or satisfaction, in the ordinary course of
business consistent with past practice or in accordance with their terms, of
liabilities reflected or reserved against in, or contemplated by, the most
recent consolidated financial statements (or the notes thereto) of Tucker
included in Tucker's filings with the Commission as of the date of the Merger
Agreement or incurred in the ordinary course of business consistent with past
practice; (ix) shall not, and shall not permit any of its subsidiaries,
subject to certain exceptions set forth in the Merger Agreement, to enter into
any material commitment, contractual obligation, borrowing, capital
expenditure or transaction (each, a "Commitment") which may result in total
payments or liability by or to it in excess of $25,000; (x) except for the
Severance Plan and the Severance Agreements, shall not, and shall not permit
any of its subsidiaries to, enter into any Commitment with any officer,
director, consultant or affiliate of Tucker or any of its subsidiaries; (xi)
shall provide Bradley with a reasonable opportunity to review and comment on
any federal income tax returns filed by Tucker or any of its subsidiaries
prior to the Effective Time; and (xii) shall not, without prior notification
and consultation with Bradley, terminate any employee under circumstances
which would result in severance payments to such employee pursuant to the
Severance Plan or pay any severance benefits to any employee under the terms
of the Severance Plan on account of such employee's purported termination for
"Good Reason" (within the meaning of the Severance Plan) on account of a
substantial adverse change in his position, authorities, responsibilities or
status.
Tucker and Bradley have agreed (a) to use all reasonable best efforts to
cooperate with one another in (i) determining which filings are required to be
made prior to the Effective Time with, and which consents, approvals, permits
or authorizations are required to be obtained prior to the Effective Time
from, governmental or regulatory authorities of the United States, the several
states and foreign jurisdictions and any third parties in connection with the
execution and delivery of the Merger Agreement, the ancillary agreements to
the Merger Agreement and the consummation of the transactions contemplated
thereby and (ii) timely making all such filings and timely seeking all such
consents, approvals, permits or authorizations; (b) to use all reasonable best
efforts to obtain in writing any consents required from third parties to
effectuate the Merger, such consents to be in reasonably satisfactory form to
Tucker and Bradley; and (c) to use all reasonable efforts to take, or cause to
be taken, all other action and do, or cause to be done, all other things
necessary, proper or appropriate to consummate and make effective the
transactions contemplated by the Merger Agreement and the ancillary
agreements.
Tucker has agreed to use its reasonable best efforts to deliver or cause
to be delivered to Bradley, prior to the Closing Date, certain letters from
"affiliates," as defined under Rule 145 promulgated under the Securities Act.
See "The Merger--Certain Resale Restrictions." Bradley has agreed to file the
reports required to be filed by it under the Exchange Act and the rules and
regulations adopted by the Commission thereunder, and to take such further
action as any affiliate of Tucker may reasonably request, all to the extent
required from time to time to enable such affiliate to sell shares of Bradley
Common Stock received by such affiliate in the Merger without registration
under the Securities Act pursuant to Rule 145(d)(1) or any successor rule or
regulation subsequently adopted by the Commission.
Tucker and Bradley have agreed that, from and after the date of the
Merger Agreement until the Effective Time, neither Tucker nor Bradley, nor any
of their respective subsidiaries or other affiliates will (i) knowingly take
any action, or knowingly fail to take any action, that would jeopardize the
qualification of the Merger as a reorganization within the meaning of Section
368(a) of the Code or (ii) enter into any contract, agreement, commitment or
arrangement with respect to the foregoing.
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TERMINATION
The Merger Agreement may be terminated and abandoned at any time prior to
the Effective Time, whether before or after approval of the Merger and the
Merger Agreement, by the stockholders of Tucker and Bradley, in a number of
circumstances, including, among others: (a) by the mutual written consent of
Tucker and Bradley; (b) by either Tucker or Bradley if (i) any United States
federal or state court of competent jurisdiction or other governmental entity
shall have issued an order, decree or ruling or taken any other action
permanently restraining, enjoining or otherwise prohibiting the Merger and
such order, decree, ruling or other action shall have become final and
nonappealable, provided that the party seeking to terminate shall have used
its best efforts to appeal such order, decree, ruling or other action, (ii)
the Merger Agreement and the transactions contemplated thereby shall have
failed to receive the requisite vote for approval by the stockholders of
Bradley or Tucker upon the holding of a duly convened stockholder meeting, or
(iii) the Merger shall not have been consummated on or before June 30, 1996
(other than due to the failure of the party seeking to terminate the Merger
Agreement to perform its obligations under the Merger Agreement required to be
performed by it at or prior to the Effective Time); (c) by action of Tucker if
(i) any representation, warranty, covenant or agreement of Bradley set forth
in the Merger Agreement has been breached or become untrue, as the case may
be, and is incapable of being satisfied by June 30, 1996, provided, however,
that, in any case, a willful breach shall be deemed to be incapable of being
satisfied for the purposes of this provision (c)(i), (ii) the Board of
Directors of Tucker recommends to Tucker's stockholders approval or acceptance
of an Acquisition Proposal (as defined below in "--No Solicitation of
Transactions") by a person other than Bradley, but only in the event that the
Board of Directors of Tucker, after consultation with and based upon the
advice of Mayer, Brown & Platt or another nationally recognized law firm, has
determined in good faith that such action is necessary for the Board of
Directors of Tucker to comply with its fiduciary duties to its stockholders
under applicable law, (iii) the Board of Directors of Bradley fails to make,
withdraws, amends, modifies or changes its approval or recommendation of the
Merger Agreement or the Merger, or (iv) the Board of Directors of Bradley
recommends to Bradley's stockholders approval or acceptance of a proposal by a
person other than Tucker to acquire 50% or more of the assets or stock of
Bradley, by way of merger, tender offer, exchange offer or similar
transaction; or (d) by action of Bradley if (i) any representation, warranty,
covenant or agreement of Tucker set forth in the Merger Agreement has been
breached or become untrue, as the case may be, and is incapable of being
satisfied by June 30, 1996, provided, however, that, in any case, a willful
breach shall be deemed to be incapable of being satisfied for the purposes of
this provision (d)(i), (ii) the Board of Directors of Tucker fails to make,
withdraws, amends, modifies or changes its approval or recommendation of the
Merger Agreement or any of the transactions contemplated thereby, (iii) Tucker
fails as soon as practicable to mail this Joint Proxy Statement/Prospectus to
its stockholders or to include the recommendation of its Board of Directors of
the Merger Agreement and the transactions contemplated thereby in this Joint
Proxy Statement/Prospectus, (iv) the Board of Directors of Tucker shall have
recommended that stockholders of Tucker accept or approve an Acquisition
Proposal by a person other than Bradley, or (v) Tucker or its Board of
Directors shall have resolved to do any of the events set forth in (d)(ii),
(d)(iii) or (d)(iv) above.
TERMINATION AMOUNT AND EXPENSES
If (a) Bradley terminates the Merger Agreement because (i) the Board of
Directors of Tucker has recommended that stockholders of Tucker accept or
approve an Acquisition Proposal by a person other than Bradley (or Tucker or
its Board has resolved to do such), or (ii) any representation, warranty,
covenant or agreement on the part of Tucker set forth in the Merger Agreement
has been willfully breached; or (b) Tucker terminates the Merger Agreement
because the Board of Directors of Tucker, after consultation with and based
upon the advice of Mayer, Brown & Platt or another nationally recognized law
firm, has determined in good faith that its fiduciary duties to its
stockholders under applicable law require it to recommend to its stockholders
approval or acceptance of an Acquisition Proposal by a person other than
Bradley, then Tucker shall pay to Bradley the Termination Amount in cash equal
to the sum of $3,000,000 plus Bradley's out-of-pocket costs and expenses in
connection with the Merger Agreement and the transactions contemplated
thereby, up to $2,000,000.
If Bradley terminates the Merger Agreement because (i) the Board of
Directors of Tucker has failed to make, or has withdrawn, amended, modified or
changed its approval or recommendation of the Merger Agreement or any of the
transactions contemplated thereby; (ii) Tucker has failed as soon as
practicable to mail
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this Joint Proxy Statement/Prospectus to its stockholders or to include the
recommendation of its Board of Directors of the Merger Agreement and the
transactions contemplated thereby in this Joint Proxy Statement/Prospectus;
(iii) Tucker or its Board of Directors has resolved to do either (i) or (ii)
above; or (iv) any representation, warranty, covenant or agreement on the part
of Tucker set forth in the Merger Agreement has been breached or become
untrue, as the case may be, and is incapable of being satisfied by June 30,
1996 (except for a termination because of a willful breach by Tucker in which
case the previous paragraph will apply), Tucker shall pay all of Bradley's
Expenses in connection with the Merger Agreement and the transactions
contemplated thereby, up to $2,000,000.
If at any time prior to or within one year after termination of the
Merger Agreement, unless such termination was (i) pursuant to mutual written
consent of Bradley and Tucker; (ii) by either Bradley or Tucker because of a
United States federal or state court of competent jurisdiction or other
governmental entity issuing a final and nonappealable order, decree or ruling
or taking any other final and nonappealable action permanently enjoining,
restraining or otherwise prohibiting the Merger (provided that the party
seeking to terminate shall have used its best efforts to appeal such order,
decree, ruling or other action); (iii) by Tucker because any representation,
warranty, covenant or agreement of Bradley set forth in the Merger Agreement
has been breached or become untrue, as the case may be, and is incapable of
being satisfied by June 30, 1996; (iv) by either Bradley or Tucker because the
Merger Agreement and the transactions contemplated thereby failed to receive
the requisite vote for approval by the stockholders of Bradley or Tucker upon
the holding of a duly convened stockholder meeting; (v) by Tucker because the
Board of Directors of Bradley failed to make, withdrew, modified or changed
its approval or recommendation of the Merger Agreement or the Merger; (vi) by
Tucker because the Board of Directors of Bradley recommended to Bradley's
stockholders that they approve or accept a proposal by a person other than
Tucker to acquire 50% or more of the assets or stock of Bradley, by way of
merger, tender offer, exchange offer or similar transaction; or (vii) by
either Tucker or Bradley because the Merger was not consummated on or before
June 30, 1996 (other than due to the failure of the party seeking to terminate
the Merger Agreement to perform its obligations under the Merger Agreement
required to be performed by it at or prior to the Effective Time), Tucker
enters into an agreement relating to an Acquisition Proposal with a person
other than Bradley or Tucker's Board of Directors recommends or resolves to
recommend to Tucker's stockholders approval or acceptance of an Acquisition
Proposal with a person other than Bradley, then, upon the entry into such
agreement or the making of such recommendation or resolution, Tucker shall pay
to Bradley the Termination Amount, which amount shall be reduced by any monies
previously paid by Tucker to Bradley pursuant to the previous paragraphs.
The Merger Agreement provides that Tucker shall not, at any time prior to
or within one year after termination of the Merger Agreement, enter into any
agreement relating to an Acquisition Proposal with a person other than Bradley
unless such agreement provides that such person shall, upon the execution of
such agreement, pay any Termination Amount due Bradley under the Merger
Agreement.
The Merger Agreement also provides that Bradley's right to payment of the
Expenses and/or Termination Amount shall be in addition to any other rights or
remedies under contract, at law or in equity to which Bradley may be entitled.
Except as otherwise provided in the Merger Agreement, Bradley and Tucker
have agreed that all costs and expenses incurred in connection with the Merger
Agreement and the transactions contemplated thereby shall be paid by the party
incurring such expenses, except that (i) the filing fee in connection with the
HSR Act filing, if any; (ii) the filing fee in connection with the filing of
this Joint Proxy Statement/Prospectus or the Registration Statement with the
Commission; and (iii) the expenses incurred for printing and mailing the
Registration Statement shall be shared equally by Tucker and Bradley. Bradley
and Tucker have also agreed that all costs and expenses for professional
services rendered pursuant to the transactions contemplated by the Merger
Agreement including, but not limited to, investment banking and legal
services, will be paid by each party incurring such services.
REDUCTION OF TERMINATION AMOUNT OR EXPENSES
In general, under the REIT provisions of the Code at least 75% of a
REIT's gross income for each taxable year must consist of defined types of
income derived directly or indirectly for investments relating to
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real property (the "75% income test"), and at least 95% of the REIT's gross
income for each taxable year must be derived from such real property
investments and from certain categories of investment income (the "95% income
test"). The Merger Agreement provides in effect for a reduction in the
Termination Amount and/or Expenses payable to Bradley if necessary to prevent
such amounts from causing Bradley to fail these REIT income requirements.
Specifically, the Merger Agreement provides that, notwithstanding anything to
the contrary set forth in the Merger Agreement, in the event that Tucker is
obligated to pay Bradley the Termination Amount and/or Expenses, Tucker (or
any other person to the extent provided in the Merger Agreement) shall pay to
Bradley from the applicable Termination Amount and/or Expenses, as the case
may be, an amount equal to the lesser of (m) the Termination Amount and/or
Expenses, as the case may be, and (n) the sum of (1) the maximum amount that
can be paid to Bradley without causing Bradley to fail to meet the
requirements of the 75% and 95% income tests determined as if the Termination
Amount did not constitute qualifying income for purposes of the 75% and 95%
income tests ("Qualifying Income"), plus (2) in the event Bradley receives
either a ruling from the IRS or an opinion from Bradley's counsel that the
Termination Amount and/or Expenses would constitute Qualifying Income or would
be excluded from gross income for purposes of the 75% and 95% income tests, an
amount equal to the Termination Amount and/or Expenses, as the case may be,
less the amount payable under clause (1) above.
NO SOLICITATION OF TRANSACTIONS
Unless and until the Merger Agreement has been terminated in accordance
with its terms, Tucker has agreed and covenanted that neither it nor any of
its subsidiaries will, and each of them will direct and use its best efforts
to cause its respective officers, directors, employees, agents and
representatives not to, directly or indirectly, initiate, solicit or encourage
any inquiries or the making or implementation of any proposal or offer
(including, without limitation, any proposal or offer to its stockholders)
with respect to a merger, acquisition, tender offer, exchange offer,
consolidation or similar transaction involving, or any purchase of 10% or more
of the assets or any equity securities or partnership interests (including,
without limitation, TOP Units) of, Tucker or any of its subsidiaries, other
than the transactions contemplated by the Merger Agreement (any such proposal
or offer being herein referred to as an "Acquisition Proposal") or engage in
any negotiations concerning, or provide any confidential information or data
to, or have any discussions with, any person relating to an Acquisition
Proposal, or otherwise facilitate any effort or attempt to make or implement
an Acquisition Proposal. In connection with the Merger Agreement, Tucker
agreed to immediately cease and cause to be terminated any existing
activities, discussions or negotiations with any parties conducted prior to
the date of the Merger Agreement with respect to any of the foregoing and to
take the necessary steps to inform the individuals or entities referred to
above of these obligations. Tucker has also agreed to notify Bradley
immediately if any such inquiries or proposals are received by, any such
information is requested from, or any such negotiations or discussions are
sought to be initiated or continued with it; provided, however, that the Board
of Directors of Tucker may (a) furnish information to or enter into
discussions or negotiations with, any person or entity that makes an
unsolicited bona fide Acquisition Proposal, if, and only to the extent that,
(i) the Board of Directors of Tucker, after consultation with and based upon
the advice of Mayer, Brown & Platt or another nationally recognized law firm,
determines in good faith that such action is required for the Board of
Directors to comply with its fiduciary duties to stockholders under applicable
law, (ii) prior to furnishing such information to, or entering into
discussions or negotiations with, such person or entity, Tucker provides
written notice to Bradley to the effect that it is furnishing information to,
or entering into discussions or negotiations with, such person or entity, and
(iii) Tucker keeps Bradley informed of the status of any such discussions or
negotiations; and (b) to the extent applicable, complies with Rule 14e-2 and
Rule 14a-9 promulgated under the Exchange Act with regard to an Acquisition
Proposal.
INDEMNIFICATION
Bradley has agreed that all rights to indemnification or exculpation
existing in favor of the directors, officers, employees, advisors and agents
of Tucker and each of its subsidiaries as provided in their respective
charters or bylaws in effect as of the date of the Merger Agreement with
respect to matters occurring at or prior to the Effective Time will survive
the Merger and will continue in full force and effect. For a period of six
years after the Effective Time, Bradley has agreed not to amend, repeal or
otherwise modify the provisions in the Bradley Charter and the Bradley Bylaws
providing for exculpation of director liability and indemnification in any
manner that would materially and adversely affect the rights thereunder of
individuals who at any time
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prior to the Effective Time were directors, officers, employees, advisors or
agents of Tucker with respect to actions or omissions occurring at or prior to
the Effective Time (including, without limitation, the transactions
contemplated by the Merger Agreement), unless such modification is required by
law; provided, however, that in the event any claim or claims are asserted or
made either prior to the Effective Time or within such six year period, all
rights to indemnification in respect of any such claim or claims will continue
until disposition of any and all such claims.
In addition to the rights provided above, in the event of any threatened
or actual claim, action, suit, proceeding or investigation, whether civil,
criminal or administrative, including, without limitation, any action by or on
behalf of any or all security holders of Tucker or Bradley or by or in the
right of Tucker or Bradley or any claim, action, suit, proceeding or
investigation in which any person who is now, or has been, at any time prior
to the date hereof, or who becomes prior to the Effective Time, a director of
Tucker (the "Indemnified Parties"), is, or is threatened to be, made a party
based in whole or in part on, or arising in whole or in part out of, or
pertaining to (i) the fact that he is or was a director of Tucker or any of
the subsidiaries of Tucker or any action or omission by such person in his
capacity as a director or (ii) the Merger Agreement or the transactions
contemplated by the Merger Agreement, whether in any case asserted or arising
before or after the Effective Time, Bradley, on the one hand, and the
Indemnified Parties, on the other hand, have agreed to cooperate and use their
reasonable best efforts to defend against and respond thereto. Bradley has
agreed that, after the Effective Time, it will indemnify and hold harmless, as
and to the full extent permitted by applicable law, each Indemnified Party
against any losses, claims, liabilities, expenses (including reasonable
attorneys' fees and expenses), judgments, fines and amounts paid in settlement
in connection with any such threatened or actual claim, action, suit,
proceeding or investigation. In addition, after the Effective Time, in the
event of any such threatened or actual claim, action, suit, proceeding or
investigation, Bradley has agreed to promptly pay and advance expenses and
costs incurred by each Indemnified Person as they become due and payable in
advance of the final disposition of any claim, action, suit, proceeding or
investigation to the fullest extent and in the manner permitted by law.
Bradley has also agreed to purchase, at or prior to the Effective Time,
liability insurance coverage for Tucker's directors and certain of its
officers for a period of six years which will provide the directors and
officers with $10,000,000 of aggregate coverage. In addition, the Tucker
Directors have agreed, at Bradley's request, to adopt certain amendments to
Tucker's existing indemnification agreements with its directors including the
deletion of any obligation of the Surviving Company to establish a trust fund
for the payment of indemnification expenses upon a change in control.
AMENDMENTS
Bradley and Tucker may amend the Merger Agreement by written agreement at
any time before or after approval of matters presented in connection with the
Merger by the stockholders of Bradley and Tucker, but after any such
stockholder approval, no amendment shall be made which by law requires the
further approval of stockholders without obtaining such further approval.
AMENDED TOP PARTNERSHIP AGREEMENT
Tucker holds substantially all of its assets through TOP and TFP. In
connection with the consummation of the Merger, (i) Bradley will acquire the
general partnership interests in TOP and the TOP Units which are currently
held by Tucker and (ii) the TOP Partnership Agreement will be amended and
restated in the form of the Amended TOP Partnership Agreement set forth as
Exhibit A to the Merger Agreement. The following summary of the Amended TOP
Partnership Agreement, including the descriptions of certain provisions set
forth elsewhere in this Joint Proxy Statement/Prospectus, is qualified in its
entirety by reference to the Amended TOP Partnership Agreement, which is filed
as an exhibit to the Registration Statement of which this Joint Proxy
Statement/Prospectus is a part.
The Amended TOP Partnership Agreement provides that management and
control of TOP will be vested in Bradley, which will serve as the sole general
partner of TOP. Equity ownership in TOP will be represented by the TOP Units.
Each TOP Unit, other than those held by Bradley, is designed to provide
distributions to the holder thereof that are equal to the distributions paid
on each share of Bradley Common Stock, and each such TOP Unit is redeemable
for the cash equivalent of one share of Bradley Common Stock
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(subject to certain restrictions), or, at Bradley's option, one share of
Bradley Common Stock. Notwithstanding the similarities of Bradley Common
Stock and TOP Units, there are certain differences between them, including the
following:
Voting Rights. Holders of Bradley Common Stock may elect the Board of
Directors of Bradley, which because Bradley will be the sole general partner
of TOP, will control the business of TOP upon consummation of the Merger.
Under the Amended TOP Partnership Agreement, Bradley as general partner may
take any action in a manner which it reasonably believes is in the best
interests of the Bradley stockholders or complies with the REIT requirements
for Bradley. Holders of TOP Units may not elect directors, or elect or remove
Bradley as the general partner of TOP. For a period of 24 months after the
Effective Time, the general partner may not elect to dissolve the partnership
or sell all or substantially all of the assets of the partnership without the
consent of a majority in interest of the limited partners, except in
connection with a merger or other business combination of the general partner
or its affiliates. The limited partners have agreed to relinquish any other
voting rights currently available in the TOP Partnership Agreement.
Transferability. The shares of Bradley Common Stock exchanged in the
Merger will be freely transferable under the Securities Act by holders who are
not affiliates of Bradley or Tucker. The TOP Units are freely transferable (i)
either by will, the laws of intestacy or otherwise to the legal representative
or successor of the transferring limited partner who shall be bound in all
respects by the terms of the Amended TOP Partnership Agreement; (ii) for inter
vivos transfers for estate planning purposes; or (iii) for pledges to secure
the repayment of a loan. Other transfers are subject to the consent and
approval of the general partner.
Other material provisions of the Amended TOP Partnership Agreement
include:
Issuance of Additional Units. The issuance of additional TOP Units will
be at the discretion of Bradley, as the sole general partner of TOP.
Notwithstanding the foregoing, for a period of 24 months after the Effective
Time, the general partner shall not cause TOP to issue additional TOP Units
with rights, powers and duties senior to the TOP Units currently held by the
limited partners. In addition, the general partner shall not permit TOP to
issue additional TOP Units for a period of 24 months after the Effective Time
if the issuance of such Units would cause a material adverse tax consequence
to the limited partners (determined in the manner described in the Amended TOP
Partnership Agreement), other than in connection with the merger,
consolidation or combination of the general partner or its affiliates.
Redemption Rights. Each partner (other than Bradley) will have the
right, subject to certain limitations, to require TOP to redeem all or a
portion of the TOP Units held by such partner for the cash equivalent of that
number of shares of Bradley Common Stock (subject to certain adjustments to
prevent dilution), or, at the option of Bradley, Bradley may elect to purchase
TOP Units presented for redemption for an equivalent number of shares of
Bradley Common Stock.
Liability of General Partner; Indemnification. The Amended TOP
Partnership Agreement generally provides that the general partner and any
person acting on its behalf will incur no liability to TOP or any limited
partner for any act or omission within the scope of the general partner's
authorities, provided the general partner's or such other person's action or
omission to act was taken in good faith and in the belief that such action or
omission was in the best interests of Bradley and its affiliates, and provided
further, that the general partner's or such other person's actions or
omissions shall not constitute actual fraud or gross negligence or
deliberately dishonest conduct.
The Amended TOP Partnership Agreement also provides for the
indemnification of the general partner and its affiliates and any individual
acting on their behalf from any loss, damage, claim or liability, including,
but not limited to, reasonable attorneys' fees and expenses, incurred by them
by reason of any act performed by them in accordance with the standards set
forth above or in enforcing the provisions of this indemnity.
Management Fees and Expenses. The Amended TOP Partnership Agreement
provides that Bradley shall be reimbursed for all expenses incurred by Bradley
relating to the management and business of TOP.
Amendment. Generally, the Amended TOP Partnership Agreement may be
amended by the general partner without the consent of limited partners, except
that certain amendments which alter or change the
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distribution rights or redemption rights of a limited partner shall require
the consent of limited partners holding a majority in interest of TOP Units.
Termination. TOP will continue until December 31, 2050, or upon
dissolution at an earlier time for specified reasons set forth in the Amended
TOP Partnership Agreement.
Environmental Matters. At the time of Tucker's initial public offering,
the Management Directors agreed to indemnify Tucker and TOP against certain
potential environmental liabilities and expenses relating to the Commons of
Chicago Ridge property. These indemnification obligations will be amended in
certain respects by the Amended TOP Partnership Agreement. Originally, the
Management Directors agreed to indemnify Tucker, TOP, TFP and each of their
subsidiaries against all claims, actions, losses, penalties, liabilities,
costs and expenses incurred by Tucker or TOP and any of their subsidiaries as
a result of or arising out of any matter, condition, or act at the Commons of
Chicago Ridge involving (1) hazardous or regulated substances, materials, or
wastes or petroleum products, (2) certain federal environmental laws, as well
as all environmental health or safety laws, regulations, and other
requirements relating to the aforementioned substances, materials, wastes, or
products, or (3) any administrative, regulatory or judicial action, suit,
investigation or proceeding relating to any of the aforementioned laws,
regulations, or other requirements or any permit thereunder, which matter,
condition or act existed on or arose prior to October 4, 1993.
The Amended TOP Partnership Agreement amends this indemnification
obligation to apply only when a third party, whether a governmental or
regulatory authority or a private party, initiates a claim, proceeding or
investigation relating to the Commons of Chicago Ridge in connection with any
applicable environmental health or safety law regarding hazardous substances,
materials, wastes or petroleum products, or any common law right of action
regarding such substances, materials, wastes or products, on or before October
4, 2003 with respect to conditions or acts at the Commons of Chicago Ridge
which existed prior to October 4, 1993.
In connection with this indemnification obligation, Bradley has agreed to
keep the Management Directors reasonably informed and to consult with the
Management Directors with respect to any potential claims, settlements and
remediation which could trigger the indemnification obligations of the
Management Directors. In the event of any remediation or proceeding, Bradley
has agreed to consider in good faith any suggestions of the Management
Directors.
The Management Directors' indemnification obligations currently are
secured by the shares of Tucker Common Stock and TOP Units acquired by the
Management Directors in connection with the Tucker's initial public offering
and, upon consummation of the Merger, will be secured by certain shares of
Bradley Common Stock (into which their respective shares of Tucker Common
Stock will be exchanged) and the TOP Units held or otherwise beneficially
owned by each of the Management Directors and their family members as of the
Effective Time. After the Effective Time, the TOP Units generally will be
exchangeable at any time for cash or shares of Bradley Common Stock (subject
to certain rights of Bradley), and all such shares of Bradley Common Stock may
be transferred at any time, subject to compliance with applicable federal
securities laws. Accordingly, there can be no assurance that the Management
Directors will hold any shares of Bradley Common Stock or TOP Units at the
time, if ever, when Bradley attempts to realize this security interest or that
the shares of Bradley Common Stock or TOP Units held by the Management
Directors will be sufficient to cover the indemnification obligations.
In connection with the execution of the Merger Agreement, Bradley and TOP
and, if the Merger is consummated, the Management Directors have agreed to
share the cost of having an outside consultant conduct a Phase II
investigation of the soil and groundwater of the Commons of Chicago Ridge and
prepare a report recommending what actions the Surviving Company should take
with respect to such matters. In the event that Bradley decides to implement
any of the recommendations of such consultant (the "Recommended Work"), TOP
and the Management Directors have each agreed to pay fifty percent of the
costs of such remediation, with the Management Directors' aggregate liability
for the Recommended Work limited to a maximum of $200,000.
Registration Rights Agreement. In connection with the amendment and
restatement of the TOP Partnership Agreement, Bradley has agreed to enter into
a registration rights agreement (the "Registration Rights Agreement") with the
holders of TOP Units, pursuant to which Bradley shall be obligated, under
certain circumstances, to file a registration statement with the Commission
with respect to sales of shares of Bradley
69
<PAGE>
Common Stock which such holders may receive upon redemption of TOP Units or to
include such shares of Bradley Common Stock in a Bradley-initiated
registration statement. Bradley has agreed to pay all fees incident to such
registration other than underwriting fees or discounts or fees of counsel,
accountants or other persons retained by the holders, other than as provided
in the Registration Rights Agreement.
Elimination of Covenant Not to Compete. The Amended TOP Partnership
Agreement has also eliminated the covenant not to compete with TOP which was
imposed on the Management Directors and certain of the executive officers of
Tucker.
TRANSFER OF INTERESTS IN TMC
In connection with the execution of the Merger Agreement, Kenneth L.
Tucker and Richard H. Tucker agreed to transfer all of their equity interests
in TMC to two individuals who are officers of Bradley in exchange for $500
each. Prior to the Merger, Kenneth Tucker holds 368 shares of common stock,
par value $.01 per share, of TMC ("TMC Common Stock") and 20 shares of
preferred stock of TMC, par value $.01 per share ("TMC Preferred Stock"), and
Richard Tucker holds 92 shares of TMC Common Stock and 5 shares of TMC
Preferred Stock. The remainder of the outstanding shares of TMC Common Stock
and TMC Preferred Stock are currently held and will continue to be held by
TOP.
70
<PAGE>
UNAUDITED PRO FORMA
COMBINED FINANCIAL STATEMENTS
BRADLEY REAL ESTATE, INC.
PRO FORMA CONDENSED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1994
(UNAUDITED)
Prior Bradley Transactions:
--------------------------
During the period from January 1, 1994 to September 30, 1995, Bradley
acquired three properties, sold one property, effected a $125,000,000 shelf
registration statement, acquired the REIT advisory business of its long-
standing external advisor, completed the July Offering and repaid certain
fixed rate mortgage debt.
In March 1994, Bradley purchased Rivercrest for $24,500,000. The purchase
of Rivercrest was financed through borrowings under the Bradley Line of
Credit. In November 1994, Bradley acquired Westwind for $7,500,000. Westwind
was purchased with the assumption of $5,000,000 of mortgage debt, with the
balance paid through a tax-deferred exchange from the sale of Spruce Tree. In
April 1995, Bradley acquired St. Francis Plaza for $5,200,000. St. Francis
Plaza was purchased with the assumption of approximately $2,100,000 of
mortgage debt and the cash proceeds from the sale of 182,500 shares of Bradley
Common Stock to the former owner of St. Francis Plaza.
On January 31, 1995, following stockholder approval, Bradley acquired the
REIT advisory business of its long-standing external advisor and thereby
became a self-administered REIT. The acquisition, pursuant to which Bradley
issued 325,000 shares of Bradley Common Stock to the owners of the advisor,
resulted in the termination of an advisory arrangement extending through
August 1999.
On July 6, 1995, Bradley completed the July Offering at a price of $16
per share. Net proceeds from the July Offering were approximately $37,405,000,
of which $32,600,000 was used to pay down the Bradley Line of Credit,
$4,712,000 was used to pay off the non-recourse mortgages assumed in November
1994 upon the acquisition of Westwind and the balance was used for general
business purposes.
Prior Tucker Transaction:
------------------------
In June 1994, Tucker acquired the Mequon Pavilion. The Mequon Pavilion
was purchased for $18,300,000 which was financed through a $13,500,000
mortgage note and borrowings for the balance under the Tucker Line of Credit.
This unaudited Pro Forma Condensed Statement of Operations is presented
as if the Bradley acquisitions, disposition and capital transactions and the
Tucker acquisition described above, and the Merger had been consummated on
January 1, 1994 and with Bradley qualifying as a REIT, distributing all of its
taxable income and, therefore, incurring no federal income tax expense during
the year ended December 31, 1994. The Merger has been accounted for under the
purchase method of accounting in accordance with Accounting Principles Board
Opinion No. 16. In the opinion of Bradley's management, all adjustments
necessary to reflect the effects of these transactions have been made.
This unaudited Pro Forma Condensed Statement of Operations is presented
for comparative purposes only and is not necessarily indicative of what the
actual results of operations of Bradley would have been for the periods
presented, nor does it purport to represent the results to be achieved in
future periods. This unaudited Pro Forma Condensed Statement of Operations
should be read in conjunction with, and is qualified in its entirety by, the
respective historical financial statements and notes thereto of Bradley and
Tucker incorporated by reference into this Joint Proxy Statement/Prospectus.
71
<PAGE>
<TABLE>
<CAPTION>
Year Ended December 31, 1994
----------------------------------------------------------------
Pro Forma Bradley
Bradley Tucker Merger as
Pro Forma(A) Pro Forma(B) Adjustments Adjusted
------------ ----------- ----------- --------
(In thousands except per share data)
<S> <C> <C> <C> <C>
Income:
Rental income............................ $ 34,387 $ 49,318 $ -- $ 83,705
Other income............................. 114 1,246 -- 1,360
--------- --------- --------- ---------
Total revenue........................... 34,501 50,564 -- 85,065
--------- --------- --------- ---------
Expenses:
Operations, maintenance
and management.......................... 5,038 6,546 -- 11,584
Real estate taxes........................ 8,186 9,921 -- 18,107
Mortgage and other interest.............. 2,876 11,112 604 (C) 14,592
Depreciation and amortization............ 6,553 10,607 (4,394)(D) 12,766
Administrative and general............... 1,826 4,012 (1,400)(E) 4,438
--------- --------- --------- ---------
Total expenses.......................... 24,479 42,198 (5,190) 61,487
--------- --------- --------- ---------
Income before allocation to minority
interest................................. 10,022 8,366 5,190 23,578
Income allocated to minority
interest................................. -- (392) -- (392)
--------- --------- --------- ---------
Net income................................ $ 10,022 $ 7,974 $ 5,190 $ 23,186
========== ========= ========= =========
Funds from operations (F)................. $ 16,575 $ 17,956 $ 35,740
========== ========= =========
Per share data:
Net income per share..................... $ .89 $ .74 $ 1.24(G)
Funds from operations (F)................ 1.48 1.66 1.92(G)
Weighted average number of shares
outstanding............................. 11,199 10,828 18,628(G)
</TABLE>
_________________
(A) See page 74 for computation of pro forma adjustments to reflect prior
Bradley transactions.
(B) See page 75 for computation of pro forma adjustments to reflect the prior
Tucker transaction.
(C) Represents the result of interest on borrowings estimated for payment of
fees and expenses related to the Merger of approximately $8,500,000, at a
weighted average interest rate of 7.1% incurred during 1994.
(D) Depreciation and amortization changes relate to recording Tucker's
properties at Bradley's purchase price, the related depreciation
utilizing an estimated useful life of 39 years and a depreciable basis of
approximately $233,000,000, and the elimination of historical
amortization of Tucker deferred assets in accordance with the purchase
method of accounting, as follows (in thousands):
<TABLE>
<S> <C>
Pro forma depreciation expense
($233,000,000 over 39 years).................... $ 5,963
Tucker depreciation.............................. (9,078)
Tucker amortization of deferred costs............ (1,279)
-------
Pro forma adjustment............................. $(4,394)
=======
</TABLE>
72
<PAGE>
(E) Represents general and administrative cost savings which have been
estimated based upon historical costs for those items which will be
eliminated as a result of the Merger, as follows (in thousands):
<TABLE>
<S> <C>
Salaries and benefits............................... $ 700
Professional fees................................... 400
D&O insurance and director fees..................... 200
Other............................................... 100
-------
Pro forma adjustment................................ $ 1,400
=======
</TABLE>
(F) Depreciation and amortization added back to net income in the calculation
of FFO for Bradley Pro Forma, Tucker Pro Forma and Bradley as Adjusted is
net of depreciation and amortization allocated to minority interest of
approximately $0, $625,000 and $212,000, respectively.
(G) The Exchange Ratio used in the pro forma financial statements was .686 of
a share of Bradley Common Stock per share of Tucker Common Stock. If the
Exchange Ratio was .665, then pro forma net income per share for the year
ended December 31, 1994 would have been $1.25, pro forma FFO per share
for the year ended December 31, 1994 would have been $1.94 and pro forma
weighted average number of shares outstanding for the year ended December
31, 1994 would have been 18,400,139.
73
<PAGE>
PRO FORMA ADJUSTMENTS TO REFLECT PRIOR BRADLEY TRANSACTIONS:
<TABLE>
<CAPTION>
Bradley
--------------------------------------------------------
Year Ended December 31, 1994
--------------------------------------------------------
Property Other
Historical Adjustments(A) Adjustments Pro Forma
---------- -------------- ----------- ---------
(In thousand except per share data)
<S> <C> <C> <C> <C>
Income:
Rental income............................ $ 32,875 $ 1,512 $ -- $ 34,387
Other income............................. 112 2 -- 114
--------- --------- --------- ---------
Total revenue........................... 32,987 1,514 -- 34,501
--------- --------- --------- ---------
Expenses:
Operations, maintenance
and management.......................... 5,315 (277) -- 5,038
Real estate taxes........................ 8,070 116 -- 8,186
Mortgage and other interest.............. 4,524 -- (1,648)(B) 2,876
Depreciation and amortization............ 5,146 -- 1,407 (C) 6,553
Administrative and general............... 2,288 -- (462)(D) 1,826
--------- --------- --------- ---------
Total expenses.......................... 25,343 (161) (703) 24,479
--------- --------- --------- ---------
Income before gain on sale
of property.............................. 7,644 1,675 703 10,022
Gain on sale of property.................... 983 (983) -- --
--------- --------- --------- ---------
Net income.................................. $ 8,627 $ 692 $ 703 $ 10,022
========= ========= ========== =========
Funds from operations....................... $ 12,790 $ 16,575
========= =========
Per share data:
Net income............................... $ 1.05 $ .89
Funds from operations.................... 1.56 1.48
Weighted average number of
shares outstanding...................... 8,192 11,199
</TABLE>
_________________
(A) Increase represents historical operating revenues and expenses for the
year ended December 31, 1994 for the three properties acquired during
1994 and 1995 for the period during which Bradley did not own them,
offset by decreases in historical operating revenues and expenses for the
year ended December 31, 1994 for the property sold in 1994 as if the
property was sold prior to the beginning of the period presented.
(B) Decrease represents the net result of interest on borrowings for the
period during which Bradley did not incur such interest and the
elimination of interest on loans which have been repaid.
(C) Increase represents additional depreciation of approximately $323,000 for
the year ended December 31, 1994 relating to the three properties
acquired during 1994 and 1995, for the period during which Bradley did
not own them and an increase in amortization of $1,192,000 resulting from
the buyout of the advisory agreement of Bradley's former external advisor
as if the buyout occurred prior to the beginning of the period presented,
partially offset by a decrease in depreciation of approximately $108,000
as if the property sold during 1994 was sold prior to the beginning of
the period presented. The increase in depreciation expense for the
property acquisitions was computed utilizing an estimated useful life of
39 years and a depreciable basis totaling $28,000,000. The decrease in
depreciation expense for the property sold was computed utilizing an
estimated useful life of 31.5 years and a depreciable basis of
$1,500,000. The amortization was computed by amortizing the cost of the
buyout of $5,565,000 over a period of approximately five years.
(D) Represents the net decrease in general and administrative expenses
estimated resulting from the acquisition of the REIT advisory business of
its long-standing external advisor as if the acquisition occurred prior
to the beginning of the period presented.
74
<PAGE>
PRO FORMA ADJUSTMENTS TO REFLECT THE PRIOR TUCKER TRANSACTION:
<TABLE>
<CAPTION>
Tucker
---------------------------------------------------------
Year Ended December 31, 1994
--------------------------------------------------------
Property Other
Historical Adjustments(A) Adjustments Pro Forma
---------- -------------- ----------- ---------
(In thousands except per share data)
<S> <C> <C> <C> <C>
Income:
Rental income............................ $ 47,911 $ 1,407 $ -- $ 49,318
Other income............................. 1,246 -- -- 1,246
--------- ---------- --------- ---------
Total revenue........................... 49,157 1,407 -- 50,564
--------- ---------- --------- ---------
Expenses:
Operations, maintenance
and management.......................... 6,178 368 -- 6,546
Real estate taxes........................ 9,921 -- -- 9,921
Mortgage and other interest.............. 10,513 -- 599(B) 11,112
Depreciation and amortization............ 10,357 -- 250(C) 10,607
Administrative and general............... 3,944 68 -- 4,012
--------- ---------- --------- ---------
Total expenses.......................... 40,913 436 849 42,198
--------- ---------- --------- ---------
Income before allocation to
minority interest........................ 8,244 971 (849) 8,366
Income allocated to minority
interest................................. (392) -- -- (392)
--------- ---------- --------- ---------
Net income................................ $ 7,852 $ 971 $ (849) $ 7,974
========= ========== ========= =========
Funds from operations (D)................. $ 17,594 $ 17,956
========= =========
Per share data:
Net income............................... $ .73 $ .74
Funds from operations (D)................ 1.62 1.66
Weighted average number of
shares outstanding...................... 10,828 10,828
</TABLE>
_________________
(A) Increase represents historical operating revenues and expenses for the
year ended December 31, 1994 for the property acquired during 1994 for
the period during which Tucker did not own it.
(B) Represents additional interest on the mortgage obtained ($13,500,000) and
an increase in the balance outstanding on the Tucker Line of Credit
($4,800,000) in connection with the acquisition of the property for the
period during which Tucker did not own it.
(C) Represents additional depreciation for the year ended December 31, 1994
relating to the property acquired during 1994 for the period during which
Tucker did not own it.
(D) Depreciation and amortization added back to net income in the calculation
of FFO for Historical and Pro Forma is net of depreciation and
amortization allocated to minority interest of approximately $615,000 and
$625,000, respectively.
75
<PAGE>
BRADLEY REAL ESTATE, INC.
PRO FORMA CONDENSED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995
(UNAUDITED)
During the period from January 1, 1995 to September 30, 1995, Bradley
acquired one property. The acquisition was funded with the assumption of
approximately $2,100,000 of mortgage debt and the cash proceeds from the sale
of 182,500 shares of Bradley Common Stock at a price of $17 per share to the
former owner of the property. Also during the period January 1, 1995 to
September 30, 1995, Bradley acquired the REIT advisory business of its long-
standing external advisor and completed the July Offering at a price of $16
per share. Net proceeds from the July Offering were approximately
$37,405,000, of which $32,600,000 was used to pay down the Line of Credit,
$4,712,000 was used to pay off the non-recourse mortgages assumed in November
1994 upon the acquisition of a property and the balance was used for general
business purposes.
This unaudited Pro Forma Condensed Statement of Operations is presented
as if the Bradley acquisitions described above, the July Offering and the
Merger had been consummated on January 1, 1994 and with Bradley qualifying as
a REIT, distributing all of its taxable income and, therefore, incurring no
federal income tax expense during the period January 1, 1995 through September
30, 1995. The Merger has been accounted for under the purchase method of
accounting in accordance with Accounting Principles Board Opinion No. 16. In
the opinion of Bradley's management, all adjustments necessary to reflect the
effects of these transactions have been made.
This unaudited Pro Forma Condensed Statement of Operations is presented
for comparative purposes only and is not necessarily indicative of what the
actual results of operations of Bradley would have been for the period
presented, nor does it purport to represent the results to be achieved in
future periods. This unaudited Pro Forma Condensed Statement of Operations
should be read in conjunction with, and is qualified in its entirety by, the
respective historical financial statements and notes thereto of Bradley and
Tucker incorporated by reference into this Joint Proxy Statement/Prospectus.
<TABLE>
<CAPTION>
Nine Months Ended September 30, 1995
--------------------------------------------------------
Pro Forma Bradley
Bradley Tucker Merger as
Pro Forma(A) Historical(B) Adjustments Adjusted
------------ ------------- ----------- --------
(In thousands except per share data)
<S> <C> <C> <C> <C>
Income:
Rental income............................ $ 26,847 $ 36,940 $ -- $ 63,787
Other income............................. 142 904 -- 1,046
----------- ----------- ---------- ----------
Total revenue........................... 26,989 37,844 -- 64,833
----------- ----------- ---------- ----------
Expenses:
Operations, maintenance
and management.......................... 4,239 6,046 -- 10,285
Real estate taxes........................ 6,384 7,910 -- 14,294
Mortgage and other interest.............. 2,535 9,835 514 (C) 12,884
Depreciation and amortization............ 5,438 8,828 (4,356)(D) 9,910
Administrative and general............... 1,154 2,242 (1,050)(E) 2,346
Provision for merger related
expenses and write-downs................ -- 1,411 (1,411)(F) --
----------- ----------- ---------- ----------
Total expenses.......................... 19,750 36,272 (6,303) 49,719
----------- ----------- ---------- ----------
Income before allocation to
minority interest........................ 7,239 1,572 6,303 15,114
Income allocated to minority interest....... -- (64) -- (64)
----------- ----------- ---------- ----------
Net income.................................. $ 7,239 $ 1,508 $ 6,303 $ 15,050
=========== =========== ========== ==========
Funds from operations (G)................... $ 12,677 $ 9,977 $ 24,796
=========== =========== ==========
Per share data:
Net income............................... $ .65 $ .14 $ .81(H)
Funds from operations (G)................ 1.13 .92 1.33(H)
Weighted average number of
shares outstanding...................... 11,199 10,828 18,628(H)
</TABLE>
76
<PAGE>
_________________
(A) See page 78 for computation of pro forma adjustments to reflect prior
Bradley transactions.
(B) Represents historical operating results as reported by Tucker for the
nine months ended September 30, 1995.
(C) Represents the result of interest on borrowings estimated for payment of
fees and expenses related to the Merger of approximately $8,500,000, at a
weighted average interest rate of 8.065% incurred for the nine months
ended September 30, 1995.
(D) Depreciation and amortization changes relate to recording Tucker's
properties at Bradley's purchase price, the related depreciation
utilizing an estimated useful life of 39 years and a depreciable basis of
approximately $233,000,000, and the elimination of historical
amortization of Tucker deferred assets in accordance with the purchase
method of accounting, as follows (in thousands):
<TABLE>
<S> <C>
Pro forma depreciation expense
($233,000,000 over 39 years)................. $ 4,472
Tucker depreciation.......................... (7,661)
Tucker amortization of deferred costs........ (1,167)
--------
Pro forma adjustment......................... $ (4,356)
========
</TABLE>
(E) Represents general and administrative cost savings which have been
estimated based upon historical costs for those items which will be
eliminated as a result of the Merger, as follows (in thousands):
<TABLE>
<S> <C>
Salaries and benefits........................ $ 525
Professional fees............................ 300
D&O insurance and director fees.............. 150
Other........................................ 75
--------
Pro forma adjustment......................... $ 1,050
========
</TABLE>
(F) Represents the elimination of the write-offs of approximately $447,000
representing costs incurred related to the Merger, approximately $491,000
representing capitalized costs related to certain development projects
which will not be pursued by the Surviving Company and approximately
$473,000 representing certain receivables.
(G) Depreciation and amortization added back to net income in the calculation
of FFO for Bradley Pro Forma, Tucker Historical and Bradley as Adjusted
is net of depreciation and amortization allocated to minority interest of
approximately $0, $359,000 and $164,000, respectively.
(H) The Exchange Ratio used in the pro forma financial statements was .686 of
a share of Bradley Common Stock per share of Tucker Common Stock. If the
Exchange Ratio was .665, then pro forma net income per share for the nine
months ended September 30, 1995 would have been $.81, pro forma FFO per
share for the nine months ended September 30, 1995 would have been $1.35
and pro forma weighted average number of shares outstanding for the nine
months ended September 30, 1995 would have been 18,400,139.
77
<PAGE>
PRO FORMA ADJUSTMENTS TO REFLECT PRIOR BRADLEY TRANSACTIONS:
<TABLE>
<CAPTION>
Bradley
----------------------------------------------------
Nine Months Ended September 30, 1995
----------------------------------------------------
(In thousands except per share data)
Property Other
Historical Adjustments(A) Adjustments Pro Forma
---------- -------------- ----------- ---------
<S> <C> <C> <C> <C>
Income:
Rental income.................... $ 26,697 $ 150 $ -- $ 26,847
Other income..................... 141 1 -- 142
--------- ---------- ---------- ---------
Total revenue................... 26,838 151 -- 26,989
--------- ---------- ---------- ---------
Expenses:
Operations, maintenance
and management.................. 4,235 4 -- 4,239
Real estate taxes................ 6,380 4 -- 6,384
Mortgage and other interest...... 3,826 -- (1,291)(B) 2,535
Depreciation and amortization.... 5,413 -- 25 (C) 5,438
Administrative and general....... 1,154 -- -- 1,154
--------- ---------- ---------- ---------
Total expenses.................. 21,008 8 (1,266) 19,750
--------- ---------- ---------- ---------
Net income.......................... $ 5,830 $ 143 $ 1,266 $ 7,239
========= ========== ========== =========
Funds from operations............... $ 11,243 $ 12,677
========= =========
Per share data:
Net income....................... $ .62 $ .65
Funds from operations............ 1.20 1.13
Weighted average number of
shares outstanding.............. 9,404 11,199
</TABLE>
_________________
(A) Increase represents historical operating revenues and expenses for the
nine months ended September 30, 1995 for the property acquired during
1995 for the period during which Bradley did not own it.
(B) Decrease represents the net result of interest on borrowings for the
period during which Bradley did not incur such interest and the
elimination of interest on loans which have been repaid.
(C) Increase represents additional depreciation for the nine months ended
September 30, 1995 relating to the property acquired during 1995 for the
period during which Bradley did not own it. Depreciation expense was
computed utilizing an estimated useful life of 39 years and a depreciable
basis totaling approximately $3,700,000.
78
<PAGE>
BRADLEY REAL ESTATE, INC.
PRO FORMA CONDENSED BALANCE SHEET
SEPTEMBER 30, 1995
(UNAUDITED)
This unaudited Pro Forma Condensed Balance Sheet is presented as if the
Merger had been consummated on September 30, 1995. The Merger has been
accounted for under the purchase method of accounting in accordance with
Accounting Principles Board Opinion No. 16. In the opinion of Bradley's
management, all adjustments necessary to reflect the effects of this
transaction have been made.
This unaudited Pro Forma Condensed Balance Sheet is presented for
comparative purposes only and is not necessarily indicative of what the actual
financial position of Bradley would have been at September 30, 1995, nor does
it purport to represent the future financial position of Bradley. This
unaudited Pro Forma Condensed Balance Sheet should be read in conjunction
with, and is qualified in its entirety by, the respective historical financial
statements and notes thereto of Bradley and Tucker incorporated by reference
into this Joint Proxy Statement/Prospectus.
<TABLE>
<CAPTION>
Pro Forma Bradley
Bradley Tucker Merger As
Historical Historical Adjustments(A) Adjusted
---------- ---------- -------------- --------
(In thousands except per share data)
<S> <C> <C> <C> <C>
Assets
------
Real estate investments, at cost............. $ 184,621 $ 319,899 $ (24,421)(B) $ 480,099
Accumulated depreciation and
amortization................................ 26,229 24,022 (24,022)(B) 26,229
---------- ---------- ------------- ----------
Net real estate investments.................. 158,392 295,877 (399) 453,870
Construction in progress..................... 2,797 3,043 -- 5,840
Cash and cash equivalents.................... 982 9,322 -- 10,304
Rents and other receivables, net............. 7,680 12,551 (8,203)(C) 12,028
Unamortized buyout of contract, net.......... 4,670 -- -- 4,670
Due from affiliates.......................... -- 114 -- 114
Deferred charges and prepaid expenses,
net......................................... 4,334 5,677 (5,990)(D) 4,021
Other assets................................. -- 3,846 (360)(E) 3,486
Total assets................................ $ 178,855 $ 330,430 $ (14,952) $ 494,333
========== ========== ============ ==========
Liabilities
-----------
Mortgage loans............................... $ 24,867 $ 132,612 -- $ 157,479
Lines of credit.............................. 9,800 44,679 8,500(F) 62,979
Accounts payable and accrued liabilities..... 8,033 14,619 -- 22,652
Dividends and distributions payable.......... -- 2,822 -- 2,822
Other liabilities............................ -- 2,877 -- 2,877
---------- ---------- ------------- ----------
Total liabilities........................... 42,700 197,609 8,500 248,809
---------- ---------- ------------- ----------
Minority interests........................... -- 5,441 (995)(G) 4,446
---------- ---------- ------------- ----------
Stockholders' Equity
--------------------
Shares of common stock....................... 112 11 63(H) 186
Paid-in capital.............................. 148,360 155,224 (50,375)(H) 253,209
Distributions in excess of accumulated
earnings.................................... (12,317) (27,855) 27,855(H) (12,317)
---------- ---------- ------------- ----------
Total stockholders' equity.................. 136,155 127,380 (22,457) 241,078
---------- ---------- ------------- ----------
Total liabilities and stockholders' equity.. $ 178,855 $ 330,430 $ (14,952) $ 494,333
========== ========== ============= ==========
</TABLE>
___________________
(A) Represents adjustments to record the Merger in accordance with the
purchase method of accounting, based upon a purchase price of
approximately $311,032,000, which assumes a value of $14.125 per share of
Bradley Common Stock, computed as follows (in thousands):
79
<PAGE>
<TABLE>
<S> <C>
Issuance of Bradley Common Stock............... $ 104,923
Assumption of Tucker liabilities............... 197,609
Merger costs................................... 8,500
---------
$ 311,032
=========
</TABLE>
(B) Decrease in net book value of the Tucker real estate assets is based upon
Bradley's purchase price.
(C) To reduce Tucker historical deferred rent and other receivables to
reflect price paid by Bradley and other adjustments in accordance with
the purchase method of accounting.
(D) Represents the elimination of deferred charges in accordance with the
purchase method of accounting and the elimination of costs related to the
Merger, capitalized as of September 30, 1995, as follows (in thousands):
<TABLE>
<S> <C>
Loan costs..................................... $ 3,743
Lease commissions.............................. 3,936
Other leasing costs............................ 883
Organization costs............................. 142
Less accumulated amortization.................. (3,027)
---------
5,677
Merger related costs........................... 313
---------
$ 5,990
=========
</TABLE>
(E) Represents capitalized costs related to a development project not
expected to be pursued by the Surviving Company.
(F) Estimated payments for fees and expenses related to the Merger as follows
(in thousands):
<TABLE>
<S> <C>
Legal and accounting........................... $ 2,400
Investment advisory fees....................... 2,025
Termination and severance...................... 1,700
D&O insurance.................................. 650
Real estate due diligence and closing costs.... 425
Printing and filing fees....................... 350
Other.......................................... 950
--------
$ 8,500
========
</TABLE>
(G) To reflect the adjustment of TOP Units based upon an exchange ratio of
.686.
(H) To adjust Tucker's capital accounts to reflect the issuance of 7,428,202
shares of Bradley Common Stock in exchange for all of the outstanding
shares of Tucker Common Stock at an Exchange Ratio of .686 shares of
Bradley Common Stock for each outstanding share of Tucker Common Stock,
as follows (in thousands):
<TABLE>
<CAPTION>
Common Paid-In Distribution In
Shares Capital Excess of Earnings
------ ------- ------------------
<S> <C> <C> <C>
Issuance of Bradley
Common Stock...................... $ 74 $ 104,849 $ --
Tucker's historical stockholders'
equity............................ (11) (155,224) (27,855)
------- --------- -----------
Merger adjustment.................. $ 63 $ (50,375) $ 27,855
======= ========= ===========
</TABLE>
If the Exchange Ratio was .665 of a share of Bradley Common Stock for
each outstanding share of Tucker Common Stock, then Tucker's capital
accounts would be adjusted to reflect the issuance of 7,200,808 shares
80
<PAGE>
of Bradley Common Stock in exchange for all the outstanding shares of
Tucker Common Stock, as follows (in thousands):
<TABLE>
<CAPTION>
Common Paid-In Distribution In
Shares Capital Excess of Earnings
------ ------- ------------------
<S> <C> <C> <C>
Issuance of Bradley
Common Stock....................... $ 72 $ 115,141 $ --
Tucker's historical stockholders'
equity............................. (11) (155,224) (27,855)
-------- -------- ------
Merger adjustment................... $ 61 $ (40,083) $ 27,855
======== ========== =========
</TABLE>
81
<PAGE>
MANAGEMENT OF THE SURVIVING COMPANY
Under the Merger Agreement, the directors and executive officers of
Bradley will become the directors and executive officers of the Surviving
Company. The directors and executive officers of Bradley, their ages,
positions and business experience for at least the past five years are set
forth below. The Board of Directors is segregated into three classes, with
terms ending in 1996, 1997 and 1998, respectively. Directors elected at future
stockholder meetings will hold office for three years. Executive officers are
elected annually by the Board of Directors for terms ending on the next annual
meeting of the Board of Directors.
<TABLE>
<CAPTION>
NAME POSITION WITH THE SURVIVING COMPANY
---- -----------------------------------
<S> <C>
E. Lawrence Miller....................... President, Chief Executive Officer and Director (term
expires in 1996)
William L. Brown......................... Director (term expires in 1996)
Joseph E. Hakim.......................... Director (term expires in 1996)
John B. Hynes III........................ Director (term expires in 1998)
Stephen G. Kasnet........................ Director (term expires in 1997)
Paul G. Kirk, Jr......................... Director (term expires in 1998)
W. Nicholas Thorndike.................... Director (term expires in 1998)
A. Robert Towbin......................... Director (term expires in 1997)
Thomas P. D'Arcy......................... Executive Vice President
Richard L. Heuer......................... Executive Vice President
Marianne Dunn............................ Senior Vice President
Irving E. Lingo, Jr...................... Chief Financial Officer
Carmella C. Brown........................ Treasurer and Controller
</TABLE>
E. Lawrence Miller, age 53, has been Chief Executive Officer of Bradley
since October 1994, President of Bradley since 1985, and was appointed to the
Board in 1992. From 1984 to 1994, Mr. Miller was also a Senior Vice President
of R.M. Bradley & Co., Inc., the long-standing external advisor of Bradley
("RMB"). Previously, Mr. Miller served as general counsel of Northeast
Operations for Prudential Insurance Company of America. Mr. Miller serves as
Chairman and a member of the Executive Committee of the Board of Governors of
the National Association of Real Estate Investment Trusts and is a member of
the Urban Land Institute and of the International Council of Shopping Centers.
William L. Brown, age 73, was Chairman of the Board of Bank of Boston
Corporation and The First National Bank of Boston from 1983 to 1989, Chief
Executive Officer from 1983 to 1987 and President from 1971 to 1982. He was a
director of both Bank of Boston Corporation and The First National Bank of
Boston until March 1992. He is also a director of GC Companies, Inc., Standex
International Corporation, Stone & Webster, Incorporated, Ionics,
Incorporated, North American Mortgage Company and the John F. Kennedy Library
Foundation.
Joseph E. Hakim, age 48, is President of Joseph P. Kennedy Enterprises,
Inc. in New York, New York, a Kennedy family-owned asset management company
for which he has held a variety of executive positions since 1974. In this
capacity, Mr. Hakim also serves as President and Chief Executive Officer of
Merchandise Mart Properties, Inc. in Chicago, Illinois, a subsidiary of Joseph
P. Kennedy Enterprises, Inc., which manages approximately 7.5 million square
feet of properties. Mr. Hakim is Treasurer of the Joseph P. Kennedy, Jr.
Foundation and the Robert F. Kennedy Memorial.
John B. Hynes III, age 37, is a Senior Vice President of RMB, overseeing
the operations of its Commercial Brokerage Division. Prior to joining RMB in
1993, Mr. Hynes directed the Boston office of Lincoln Property Company (a
commercial real estate development company) as its Operating Partner, and
prior to that time was a Vice President of the Codman Company of Boston. He is
a member of numerous Boston real estate industry organizations.
Stephen G. Kasnet, age 50, was Managing Director of First Winthrop
Corporation and Winthrop Financial Associates (real estate development and
management companies) from 1991 to September 1995. From 1989 to 1991, he was
Executive Vice President of Cabot, Cabot & Forbes (a real estate development
and management company) and prior to 1989 was Executive Vice President of RMB.
He is Chairman of the Board of Warren
82
<PAGE>
Bancorp, Inc. and Warren Five Cents Savings Bank in Peabody, Massachusetts, a
trustee of Pioneer Winthrop Real Estate Investment Fund and a member of the
Urban Land Institute.
Paul G. Kirk, Jr., age 57, is counsel to, and until 1989 was a partner
of, the law firm of Sullivan & Worcester in Boston, Massachusetts. He is also
Chairman and Treasurer of Kirk-Sheppard & Co., Inc., a business advisory and
consulting firm. From 1985 to 1989, he served as Chairman of the Democratic
Party of the United States, and from 1983 to 1985 as its Treasurer. Mr. Kirk
is a director of ITT Corporation, ITT Hartford Insurance Co. and Rayonier,
Inc. He is a trustee of Stonehill College and St. Sebastian's School, Co-
Chairman of the Commission on Presidential Debates, Chairman of the John F.
Kennedy Library Foundation and Chairman of the National Democratic Institute
for International Affairs.
W. Nicholas Thorndike, age 62, serves as a corporate director or trustee
of a number of organizations, including Courier Corporation, Providence
Journal Company, Eastern Utility Associates, Data General Corporation and The
Putnam Funds. He also serves as a Trustee of Massachusetts General Hospital,
having served as Chairman of the Board from 1987 to 1992 and President from
1992 to 1994. Until December 1988, he was Chairman and Managing Partner of
Wellington Management Company (an investment advisor). In February 1994, he
was appointed a successor trustee of certain private trusts in which he had no
beneficial interest and concurrently became (until October 1994) Chairman of
two privately-owned corporations controlled by such trusts. These corporations
filed voluntary petitions under Chapter 11 of the Federal Bankruptcy Code in
August 1994.
A. Robert Towbin, age 60, is a Managing Director of Unterberg Harris.
From January 1994 to August 1995, he was President and Chief Executive Officer
of the Russian American Enterprise Fund and, upon its merger with the Fund for
Large Enterprises in Russia, Vice Chairman of the resulting U.S. Russia
Investment Fund. From 1987 to 1994, Mr. Towbin was a Managing Director of
Lehman Brothers. Prior to 1987, he was a director and Vice Chairman of L.F.
Rothschild, Unterberg, Towbin Holdings, Inc. Mr. Towbin serves as a director
of the Columbus New Millenium Fund, Gerber Scientific, Inc., Globalstar
Telecommunications Limited and K&F Industries Inc., and is a former director
of several other public companies. He is a member of the Securities Industry
Association and is a director of numerous charitable and civic organizations.
Thomas P. D'Arcy, age 36, has served as Executive Vice President of
Bradley since September 1995, having previously served as Senior Vice
President of Bradley since 1992 and Vice President of Bradley since 1989.
Prior to joining Bradley, Mr. D'Arcy was employed by RMB as a member of its
property management and real estate brokerage departments for over eight
years. Mr. D'Arcy is a member of the International Council of Shopping Centers
and the Building Owners and Managers Association.
Richard L. Heuer, age 43, has served as Executive Vice President of
Bradley since September 1995, having previously served as Senior Vice
President of Bradley since late 1994. Prior to joining Bradley, Mr. Heuer was
employed by the Welsh Companies, the independent property management company
that was managing Bradley's Minnesota properties.
Marianne Dunn, age 36, was named Senior Vice President of Bradley in
September 1995, having served as Vice President of Bradley since 1993 and as
Investment Manager since 1990. Prior to joining Bradley, Ms. Dunn was
employed by a lending institution as an Assistant Treasurer in the consumer
lending department. Ms. Dunn is a member of the International Council of
Shopping Centers.
Irving E. Lingo, Jr., age 43, joined Bradley as Chief Financial Officer
in September 1995. Mr. Lingo was most recently employed as Chief Financial
Officer of Lingerfelt Industrial Properties, a division of the Liberty
Property Trust from 1993 to 1995. From 1991 to 1992, Mr. Lingo served as Vice
President-Finance of CSX Realty, a division of CSX Corporation. From 1983 to
1990, Mr. Lingo was Executive Vice President of Goodman Segar Hogan, Inc., a
diversified Southeastern real estate firm. Prior to joining Goodman Segar
Hogan, Mr. Lingo was associated with Ernst & Young for eight years. Mr. Lingo
is a certified public accountant and member of the American Institute of
Certified Public Accountants.
Carmella C. Brown, age 31, was named Treasurer of Bradley in 1995 and has
served as Controller of Bradley since 1993, having previously served as
Accounting Manager since 1990. She was also employed by RMB from 1990 to 1994,
prior to which she was employed by KPMG Peat Marwick as a Senior Accountant.
Ms. Brown is a member of the American Institute of Certified Public
Accountants and the Massachusetts Society of Certified Public Accountants.
83
<PAGE>
THE MEETINGS OF STOCKHOLDERS
BRADLEY SPECIAL MEETING
The Bradley Special Meeting will be held at __________________, Boston,
Massachusetts _____, on February __, 1996, at 10:00 a.m., Eastern time. At
the Bradley Special Meeting, holders of Bradley Common Stock will consider and
vote upon a proposal to approve the Merger and the Merger Agreement. This
proposal must be approved by the affirmative vote of the holders of a majority
of the outstanding shares of Bradley Common Stock entitled to vote thereon.
Holders of Bradley Common Stock are entitled to one vote per share.
Bradley has fixed the close of business on January __, 1996 as the
Bradley Record Date for determining holders entitled to notice of and to vote
at the Bradley Special Meeting. Only holders of Bradley Common Stock at the
close of business on the Bradley Record Date will be entitled to notice of and
to vote at the Bradley Special Meeting. As of the Bradley Record Date, there
were 11,226,624 shares of Bradley Common Stock issued and outstanding, of
which approximately 64,000 shares (representing less than 1% of the
outstanding shares of Bradley Common Stock) were owned beneficially by
directors and executive officers of Bradley and their affiliates. As of the
date of the Merger Agreement, all of the directors and executive officers of
Bradley indicated that they presently intended to vote all shares of Bradley
Common Stock which they own to approve the Merger and the Merger Agreement.
All shares of Bradley Common Stock represented by properly executed
proxies will, unless such proxies have been previously revoked, be voted in
accordance with the instructions indicated in such proxies. IF NO INSTRUCTIONS
ARE INDICATED, SUCH SHARES OF BRADLEY COMMON STOCK WILL BE VOTED IN FAVOR OF
THE MERGER AND THE MERGER AGREEMENT. A stockholder who has given a proxy may
revoke it at any time prior to its exercise by giving written notice thereof
to the Secretary of Bradley, by signing and returning a later-dated proxy or
by voting in person at the Bradley Special Meeting; however, mere attendance
at the Bradley Special Meeting will not in and of itself have the effect of
revoking the proxy.
Votes cast by proxy or in person at the Bradley Special Meeting will be
tabulated by the inspector(s) of election appointed for the meeting and will
determine whether or not a quorum is present. The presence in person or by
properly executed proxy of the holders of a majority of the issued and
outstanding shares of Bradley Common Stock entitled to vote at the Bradley
Special Meeting is necessary to constitute a quorum at the Bradley Special
Meeting. Abstentions and broker non-votes will be treated as shares that are
present at the Bradley Special Meeting for purposes of determining whether a
quorum exists. In order to be approved, the Merger and the Merger Agreement
must receive the affirmative vote of the holders of a majority of the issued
and outstanding shares of Bradley Common Stock entitled to vote on the Merger
and the Merger Agreement. Abstentions and broker non-votes will have the
effect of votes against the approval of the Merger and the Merger Agreement.
Bradley will bear its own cost of solicitation of proxies. Brokerage
firms, fiduciaries, nominees and others will be reimbursed for their out-of-
pocket expenses in forwarding proxy materials to beneficial owners of shares
of Bradley Common Stock held in their names. In addition to the use of the
mails, proxies may be solicited by directors, officers and regular employees
of Bradley, who will not be specifically compensated for such services, by
means of personal calls upon, or telephonic or telegraphic communications
with, stockholders or their representatives. In addition,
_____________________________ has been engaged by Bradley to act as proxy
solicitors and will receive a fee of $______ plus expenses.
THE BOARD OF DIRECTORS OF BRADLEY HAS UNANIMOUSLY APPROVED THE MERGER AND
THE MERGER AGREEMENT AND UNANIMOUSLY RECOMMENDS THAT BRADLEY STOCKHOLDERS VOTE
FOR APPROVAL OF THE MERGER AND THE MERGER AGREEMENT. SEE "THE MERGER--
BACKGROUND OF THE MERGER" AND "--REASONS FOR THE MERGER; RECOMMENDATION OF THE
BOARD OF DIRECTORS OF BRADLEY."
84
<PAGE>
TUCKER SPECIAL MEETING
The Tucker Special Meeting will be held at __________________, Chicago,
Illinois _____, on February __, 1996, at 9:00 a.m., Central time. At the
Tucker Special Meeting, holders of Tucker Common Stock will consider and vote
upon a proposal to approve the Merger and the Merger Agreement. This proposal
must be approved by the affirmative vote of the holders of two-thirds of the
outstanding shares of Tucker Common Stock entitled to vote thereon. Holders
of Tucker Common Stock are entitled to one vote per share.
The Tucker Board of Directors has fixed the close of business on January
__, 1996 as the Tucker Record Date for determining holders entitled to notice
of and to vote at the Tucker Special Meeting. Only holders of Tucker Common
Stock at the close of business on the Tucker Record Date will be entitled to
notice of and to vote at the Tucker Special Meeting. As of the Tucker Record
Date, there were 10,828,283 shares of Tucker Common Stock issued and
outstanding, of which 112,583 shares (representing approximately 1% of the
outstanding shares of Tucker Common Stock) were owned beneficially by
directors and executive officers of Tucker and their affiliates. As of the
date of the Merger Agreement, all of the directors and executive officers of
Tucker indicated that they presently intended to vote all shares of Tucker
Common Stock which they own to approve the Merger and the Merger Agreement.
All shares of Tucker Common Stock represented by properly executed
proxies will, unless such proxies have been previously revoked, be voted in
accordance with the instructions indicated in such proxies. IF NO INSTRUCTIONS
ARE INDICATED, SUCH SHARES OF TUCKER COMMON STOCK WILL BE VOTED IN FAVOR OF
THE MERGER AND THE MERGER AGREEMENT. A stockholder who has given a proxy may
revoke it at any time prior to its exercise by giving written notice thereof
to the Secretary of Tucker, by signing and returning a later-dated proxy or by
voting in person at the Tucker Special Meeting; however, mere attendance at
the Tucker Special Meeting will not in and of itself have the effect of
revoking the proxy.
Votes cast by proxy or in person at the Tucker Special Meeting will be
tabulated by the inspector(s) of election appointed for the meeting and will
determine whether or not a quorum is present. The presence in person or by
properly executed proxy of the holders of a majority of the issued and
outstanding shares of Tucker Common Stock entitled to vote at the Tucker
Special Meeting is necessary to constitute a quorum at the Tucker Special
Meeting. Abstentions and broker non-votes will be treated as shares that are
present at the Tucker Special Meeting for purposes of determining whether a
quorum exists. In order to be approved, the Merger and the Merger Agreement
must receive the affirmative vote of the holders of two-thirds of the issued
and outstanding shares of Tucker Common Stock entitled to vote on the Merger
and the Merger Agreement. Abstentions and broker non-votes will have the
effect of votes against the approval of the Merger and the Merger Agreement.
Tucker will bear its own cost of solicitation of proxies. Brokerage
firms, fiduciaries, nominees and others will be reimbursed for their out-of-
pocket expenses in forwarding proxy materials to beneficial owners of shares
of Tucker Common Stock held in their names. In addition to the use of the
mails, proxies may be solicited by directors, officers and regular employees
of Tucker, who will not be specifically compensated for such services, by
means of personal calls upon, or telephonic or telegraphic communications
with, stockholders or their representatives. In addition,
_____________________________ has been engaged by Tucker to act as proxy
solicitors and will receive a fee of $______ plus expenses.
THE BOARD OF DIRECTORS OF TUCKER HAS UNANIMOUSLY APPROVED THE MERGER AND
THE MERGER AGREEMENT AND UNANIMOUSLY RECOMMENDS THAT TUCKER STOCKHOLDERS VOTE
FOR APPROVAL OF THE MERGER AND THE MERGER AGREEMENT. SEE "THE MERGER--
BACKGROUND OF THE MERGER" AND "--REASONS FOR THE MERGER; RECOMMENDATION OF THE
BOARD OF DIRECTORS OF TUCKER."
85
<PAGE>
COMPARISON OF STOCKHOLDER RIGHTS
At the Effective Time, the stockholders of Tucker will become
stockholders of Bradley. As stockholders of Tucker, their rights are presently
governed by the MGCL, the Tucker Charter and the Tucker Bylaws. As
stockholders of Bradley, their rights will be governed by the MGCL, the
Bradley Charter and the Bradley Bylaws. The Merger will not result in any
change in the Bradley Charter or the Bradley Bylaws.
The following discussion summarizes certain differences between the
rights of stockholders of Bradley and the rights of stockholders of Tucker.
This summary does not purport to be complete and is subject to and qualified
in its entirety by reference to the Tucker Charter, the Tucker Bylaws, the
Bradley Charter, the Bradley Bylaws and the relevant provisions of the MGCL.
Copies of the Tucker Charter, the Tucker Bylaws, the Bradley Charter and the
Bradley Bylaws are incorporated by reference as exhibits to the Registration
Statement.
AMENDMENT OF CHARTER AND BYLAWS
In conformity with the MGCL and the Bradley Charter, the Bradley Charter
may be amended by the Board of Directors, with the approval of the holders of
a majority of all of the votes entitled to be cast on the matter, except that
the Bradley Charter permits the Board of Directors to amend the limitations on
transfer and ownership of stock to the extent the Board deems appropriate to
assure continued qualification as a REIT, without a vote of the stockholders.
The Bradley Bylaws may be amended by the affirmative vote of the holders of a
majority of the shares of Bradley Common Stock or by the Board of Directors
without a vote of the stockholders.
In conformity with the MGCL, the Tucker Charter may be amended by the
Board of Directors, with the approval of the holders of at least two-thirds of
all of the votes entitled to be cast on the matter. The Tucker Bylaws may only
be amended by the Board; provided, however, that the Bylaw provisions which
(i) reserve to the independent directors the right to make all decisions
regarding enforcement of certain agreements and (ii) set forth the number,
tenure and qualification of the Directors, including the requirement that a
majority of the Board be comprised of independent directors may only be
amended by the affirmative vote of stockholders owning a majority of the votes
cast at a stockholders' meeting at which a quorum is present.
REQUIRED VOTE FOR AUTHORIZATION OF CERTAIN ACTIONS
Under the MGCL, unless a corporation's charter provides for a lesser
percentage (but not less than a majority), a proposed consolidation, merger,
share exchange or transfer of assets must be approved by the stockholders of
each corporation by the affirmative vote of two-thirds of all the votes
entitled to be cast on the matter. The Bradley Charter provides that such
transactions may be approved by the affirmative vote of a majority of all the
votes entitled to be cast on the matter. The Tucker Charter contains no such
provision and therefore, such transactions require the approval of two-thirds
of all votes entitled to be cast on the matter.
BOARD OF DIRECTORS
The Bradley Bylaws provide that the number of directors of Bradley may be
established by the Board of Directors but may not be fewer than the minimum
number required by Maryland law. Directors of Bradley hold office until their
successors are duly elected and qualified or until their death, resignation or
removal by the affirmative vote of the holders of a majority of the
outstanding shares of Bradley Common Stock. The Bradley Charter provides that
a director may be removed from office only for cause and only by the
affirmative vote of at least a majority of the votes entitled to be cast in
the election of directors.
Pursuant to the terms of the Bradley Charter, the directors are divided
into three classes with the term of office of one class expiring each year. As
the term of each class expires, directors in that class will be elected for a
term of three years and until their successors are duly elected and qualified.
The use of a staggered board may have the effect of delaying or deferring a
change in control of Bradley or removal of incumbent management.
The Tucker Bylaws provide that the number of directors of Tucker may be
established by the Board of Directors but may not be fewer than the minimum
number required by Maryland law nor more than nine. The Tucker Bylaws also
require a majority of the Board of Directors to be independent. These
provisions may only be amended by a vote of a majority of all of the votes
cast at a stockholders meeting at which a quorum is present. Pursuant to the
terms of the Tucker Charter, each director will hold office for a one-year
term expiring at the annual meeting of stockholders to be held the following
year and until his successor is duly elected and qualified.
86
<PAGE>
The Tucker Charter provides that a director may be removed only for cause
and only by the affirmative vote of at least two-thirds of the votes entitled
to be cast for the election of directors. This provision, when coupled with
the provision in the Bylaws authorizing the Board to fill vacant
directorships, precludes stockholders from removing incumbent directors and
filling the vacancies created by the removal with their own nominees except
upon a substantial affirmative vote.
SPECIAL MEETINGS
The Bradley Bylaws provide that the chairman, if any, the president or a
majority of the Board of Directors may call a special meeting of Bradley's
stockholders. A special meeting may also be called by the secretary upon the
written request of stockholders entitled to cast 25% or more of the votes
entitled to be cast at such meeting.
The Tucker Bylaws provide that the chairman, if any, the president or the
Board of Directors may call a special meeting of Tucker's stockholders. A
special meeting may also be called by any stockholders who hold in the
aggregate not less than 10% of the outstanding shares of Tucker Common Stock.
BUSINESS COMBINATIONS
Under the MGCL, certain "business combinations" (including a merger,
consolidation, share exchange, or, in certain circumstances, an asset transfer
or issuance or reclassification of equity securities) between a Maryland
corporation and any person who beneficially owns 10% or more of the voting
power of the corporation's shares or an affiliate of the corporation who, at
any time within the two-year period prior to the date in question, was the
beneficial owner of 1% or more of the voting power of the then-outstanding
voting stock of the corporation (an "Interested Stockholder") or an affiliate
thereof are prohibited for five years after the most recent date on which the
Interested Stockholder becomes an Interested Stockholder. Thereafter, any
such business combination must be recommended by the board of directors of the
corporation and approved by the affirmative vote of at least (i) 80% of the
votes entitled to be cast by holders of outstanding voting shares of the
corporation and (ii) two-thirds of the votes entitled to be cast by holders of
outstanding voting shares of the corporation other than shares held by the
Interested Stockholder with whom (or with whose affiliate) the business
combination is to be effected, unless, among other conditions, the
corporation's common stockholders receive a minimum price (as defined in the
MGCL) for their shares and the consideration is received in cash or in the
same form as previously paid by the Interested Stockholder for its shares.
These provisions of Maryland law do not apply, however, to business
combinations that are approved or exempted by the board of directors of the
corporation prior to the time that the Interested Stockholder becomes an
Interested Stockholder.
The Board of Directors of Tucker has exempted from these provisions of
the MGCL any business combination with Kenneth Tucker and Richard Tucker (the
"Tuckers") or any person acting in concert or as a group with the Tuckers.
Bradley has not made any exemptions from these provisions of the MGCL other
than for the Merger.
RESTRICTIONS ON THE OWNERSHIP, TRANSFER OR ISSUANCE OF SHARES
For a company to qualify as a REIT under the Code, among other things,
not more than 50% in value of its outstanding capital stock may be owned,
directly or indirectly, by five or fewer individuals (defined in the Code to
include certain entities) during the last half of a taxable year (other than
the first year), and such capital stock must be beneficially owned by 100 or
more persons during at least 335 days of a taxable year of 12 months (other
than the first year) or during a proportionate part of a shorter taxable year.
The Bradley Charter contains provisions, designed to ensure that Bradley
remains a qualified REIT, that generally limit any holder from owning, or
being deemed to own by virtue of the attribution provisions of the Code,
shares of capital stock having a value that is more than 9.8% (the "Ownership
Limit") of the value of all outstanding capital stock of Bradley. The Bradley
Charter provides that each person (which includes natural persons,
corporations, trusts, partnerships and other entities) shall be deemed to own
stock that such person (i) actually owns, (ii) constructively owns after
applying attribution rules specified in the Code, and (iii) has the right to
acquire upon exercise of any options or warrants or conversion of any
convertible securities held by such person. The fact that certain affiliated
entities, such as separate mutual funds advised by the same investment
adviser, may own more than 9.8% of the value of all outstanding capital stock
in the aggregate will not of itself result in the Ownership Limit being
exceeded, merely because a single person may be considered to be the
"beneficial owner" of such stock for purposes of Section 13(g) of the Exchange
Act. Bradley's Board of Directors may waive the Ownership Limit if evidence
satisfactory to the Board of Directors and Bradley's tax counsel is presented
that the changes in ownership will not then or in the future jeopardize
Bradley's status as a REIT.
87
<PAGE>
The Bradley Charter provides that any transfer of Bradley capital stock
or any security convertible into capital stock that would create direct or
indirect ownership of capital stock in excess of the Ownership Limit or that
would result in the disqualification of Bradley as a REIT, including any
transfer that results in Bradley being "closely held" within the meaning of
Section 856(h) of the Code, shall be null and void, and the intended
transferee will acquire no rights to the capital stock. Shares of capital
stock owned, or deemed to be owned, or transferred to a stockholder in excess
of the Ownership Limit will automatically be exchanged for shares of Excess
Stock (as described below) that will be transferred, by operation of law, to a
trustee (to be named by the Board of Directors of Bradley, but unaffiliated
with Bradley) as trustee for the exclusive benefit (except to the extent
described below) of one or more charitable beneficiaries designated from time
to time by the Board of Directors. The Excess Stock held in trust will be
considered as issued and outstanding shares of stock of Bradley, will be
entitled to receive distributions declared by Bradley and may be voted by the
trustee for the exclusive benefit of the charitable beneficiary. Any dividend
or distribution paid to a purported transferee of Excess Stock prior to the
discovery by Bradley that capital stock has been transferred in violation of
the provisions of the Bradley Charter (a "prohibited transfer") shall be
repaid to Bradley upon demand and thereupon paid over by Bradley to the
trustee. Any votes of holders of shares of capital stock purported to have
been cast by a purported transferee prior to such discovery of a prohibited
transfer will be retroactively deemed not to have been cast, but said
retroactive nullification of the vote of the relevant shares of capital stock
shall not adversely affect the rights of any person (other than the purported
transferee) who has relied in good faith upon the effectiveness of the matter
that was the subject of the stockholder action as to which such votes were
cast.
The Bradley Charter provides that Excess Stock is not transferable.
Subject to the redemption rights of Bradley discussed below, the trustee of
the trust may, however, sell and transfer the interest in the trust to a
transferee in whose hands the interest in the trust representing Excess Stock
would not be an interest in Excess Stock, and upon such sale the shares of
Excess Stock represented by the sold interest shall be automatically exchanged
for shares of capital stock of the class that was originally exchanged into
such Excess Stock. Upon such sale, the trustee shall distribute to the
purported transferee only so much of the sales proceeds as is not more than
the price paid by the purported transferee in the prohibited transfer that
resulted in the exchange of Excess Stock for the capital stock purported to
have been transferred (or, if the purported transferee received such capital
stock by gift, devise or otherwise without giving value for such stock, only
an amount that does not exceed the market price for such stock, as determined
in the manner set forth in the Bradley Charter, at the time of the prohibited
transfer), and the trustee shall distribute all remaining proceeds from such
sale to the charitable beneficiary.
In addition to the foregoing transfer restrictions, Bradley will have the
right, for a period of 90 days during the time any Excess Stock is held by the
trustee, to purchase all or any portion of the Excess Stock from the trustee
for the lesser of the price paid for the capital stock by the original
purported transferee or the market price of the capital stock on the date
Bradley exercises its options to purchase. Upon any such purchase by Bradley,
the trustee shall distribute the purchase price to the original purported
transferee. The 90-day period begins on the date on which Bradley receives
written notice of the prohibited transfer or other event resulting in the
exchange of capital stock for Excess Stock.
If the foregoing transfer restrictions are determined to be void or
invalid by virtue of any legal decision, statute, rule or regulation, then the
intended transferee of any Excess Stock may be deemed, at the option of
Bradley, to have acted as an agent on behalf of Bradley in acquiring the
Excess Stock and to hold the Excess Stock on behalf of Bradley.
These restrictions will not preclude settlement of transactions on the
NYSE or any other stock exchange on which capital stock of Bradley is listed.
The foregoing restrictions on transferability and ownership also will not
apply if Bradley's Board of Directors determines that it is no longer in the
best interests of Bradley to continue to qualify as a REIT.
The Bradley Charter requires that, upon demand by Bradley, each
stockholder and each proposed transferee of capital stock will disclose to
Bradley in writing any information with respect to the direct, indirect and
constructive ownership of shares of stock as Bradley's Board of Directors
deems necessary to comply with the provisions of the Code applicable to REITs,
to comply with the requirements of any taxing authority or governmental agency
or to determine any such compliance.
The Tucker Charter contains ownership and transfer restrictions generally
comparable to those in the Bradley Charter, except that (i) no person, other
than the Tuckers, may own, or be deemed to own by virtue of the attribution
provision of the Code, more than 7% of the value of the issued and outstanding
stock of Tucker and
88
<PAGE>
(ii) the Tuckers and their affiliates may not own, directly or indirectly,
more than 21% of the value of the issued and outstanding stock of Tucker.
The ownership restrictions provided by the Bradley Charter and the Tucker
Charter may have the effect of delaying, deferring or preventing the
acquisition of control of Bradley or Tucker. However, the Bradley Charter
provides that the Ownership Limit shall not apply to shares of capital stock
acquired pursuant to an all cash tender offer for all of the outstanding
shares of capital stock in conformity with applicable laws where not less than
two-thirds of the outstanding shares of capital stock (not including
securities held by the tender offeror and/or its affiliates and associates)
are tendered and accepted pursuant to such tender offer and where the tender
offeror commits in such tender offer promptly after the tender offeror's
purchase of the tendered stock, to give any non-tendering stockholders a
reasonable opportunity to put their capital stock to the tender offeror at a
price not less than that paid pursuant to the tender offer.
ADVANCE NOTICE FOR STOCKHOLDER PROPOSALS
The Bradley Bylaws provide that any stockholder of record wishing to
nominate a director or have a stockholder proposal considered at an annual
meeting (except for stockholder proposals included in Bradley's proxy
materials pursuant to Rule 14a-8 under the Exchange Act) must provide written
notice and certain supporting documentation to Bradley relating to the
nomination or proposal not less than 75 days nor more than 150 days prior to
the anniversary date of the prior year's annual meeting or special meeting in
lieu thereof (the "Anniversary Date"). In the event that the annual meeting
is called for a date more than seven calendar days before the Anniversary
Date, stockholders generally must provide written notice within 20 calendar
days after the date on which notice of the meeting is mailed to stockholders.
The purpose of requiring stockholders to give Bradley advance notice of
nominations and other business is to afford the Board of Directors a
meaningful opportunity to consider the qualifications of the proposed nominees
or the advisability of the other proposed business and, to the extent deemed
necessary or desirable by the Board of Directors, to inform stockholders and
make recommendations about the qualifications or business, as well as to
provide a more orderly procedure for conducting meetings of stockholders.
Although Bradley's Bylaws do not give the Board of Directors any power to
disapprove stockholder nominations for the election of directors or proposals
for action, they may have the effect of precluding a contest for the election
of directors or the consideration of stockholder proposals if the proper
procedures are not followed, and of delaying or deferring a third party from
conducting a solicitation of proxies to elect its own slate of directors or to
approve its own proposal, without regard to whether consideration of the
nominees or proposals might be harmful or beneficial to Bradley and its
stockholders.
The Tucker Bylaws provide that any stockholder of record wishing to
nominate a director or to make a stockholder proposal must deliver a notice
and certain supporting documentation to the secretary or Tucker not less than
60 days nor more than 90 days 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, notice by the stockholder to be timely must
be so delivered not earlier than 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. Such stockholder's
notice shall set forth (i) as to each person whom the stockholder proposes to
nominate for election or reelection as a director all information relating to
such person that is required to be disclosed in solicitations of proxies for
election of directors, or is otherwise required, in each case pursuant to
Regulation 14A under the Exchange Act (including such person's written consent
to being named in the proxy statement as a nominee and to serving as a
director if elected); (ii) as to any other business that the stockholder
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 the meeting and any material interest in such business of such
stockholder and of the beneficial owner, if any, on whose behalf the proposal
is made; and (iii) as to the stockholder 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 stockholder, as they appear on Tucker's books, and of
such beneficial owner, and (y) the class and number of shares of stock of
Tucker which are owned beneficially and of record by such stockholder and such
beneficial owner.
CONTROL SHARE ACQUISITIONS
The MGCL provides that "control shares" of a Maryland corporation
acquired in a "control share acquisition" have no voting rights except to the
extent approved by a vote of two-thirds of the votes entitled to be
89
<PAGE>
cast on the matter, excluding shares of stock owned by the acquiror or by
officers or directors who are employees of the corporation. "Control shares"
are voting shares of stock which, if aggregated with all other such shares of
stock previously acquired by the acquiror, or in respect of which the acquiror
is able to exercise or direct the exercise of voting power except solely by
virtue of a revocable proxy, would entitle the acquiror to exercise voting
power in electing directors within one of the following ranges of voting
power: (i) one-fifth or more but less than one-third; (ii) one-third or more
but less than a majority; or (iii) a majority of all voting power. Control
shares do not include shares the acquiring person is then entitled to vote as
a result of having previously obtained stockholder approval. A "control share
acquisition" means the acquisition of control shares, subject to certain
exceptions.
A person who has made or proposes to make a control share acquisition,
upon satisfaction of certain conditions (including an undertaking to pay
expenses and delivery of an "acquiring person statement"), may compel the
corporation's board of directors to call a special meeting of stockholders to
be held within 50 days of demand to consider the voting rights of the shares.
If no request for a meeting is made, the corporation may itself present the
question at any stockholders meeting.
Unless the articles or bylaws provide otherwise, if voting rights are not
approved at the meeting or if the acquiring person does not deliver an
acquiring person statement within ten (10) days following a control share
acquisition then, subject to certain conditions and limitations, the
corporation may redeem any or all of the control shares (except those for
which voting rights have previously been approved) for fair value determined,
without regard to the absence of voting rights for the control shares, as of
the date of the last control share acquisition or of any meeting of
stockholders at which the voting rights of such shares are considered and not
approved. Moreover, unless the articles or bylaws provide otherwise, if voting
rights for control shares are approved at a stockholders' meeting and the
acquiror becomes entitled to exercise or direct the exercise of a majority or
more of all voting power other stockholders may exercise appraisal rights.
The fair value of the shares as determined for purposes of such appraisal
rights may not be less than the highest price per share paid by the acquiror
in the control share acquisition.
The control share acquisition statute does not apply to shares acquired
in a merger, consolidation or share exchange if the corporation is a party to
the transaction, or to acquisitions approved or exempted by the articles or
bylaws of the corporation.
Pursuant to the statute, Tucker has exempted control share acquisitions
involving "Existing Holders," including the Tuckers, their affiliates and
persons acting in concert with either of the Tuckers, that are not prohibited
or restricted by the terms of the Tucker Charter, and the prohibition on
voting control shares will not apply to the Tuckers, their affiliates and
persons acting in concert with either of the Tuckers. An "Existing Holder" is
defined in the Tucker Charter as: (i) any Person (as defined in the Tucker
Charter) who is, or would be upon the exchange of TOP Units, the owner of
Equity Stock (defined as either Tucker Common Stock or preferred stock of
Tucker) in excess of the Ownership Limit set forth in the Tucker Charter, and
(ii) any Person to whom an Existing Holder transfers ownership of equity stock
causing such transferee to own equity stock in excess of the Ownership Limit.
All other stockholders are subject to the terms of the control share
acquisition statute.
The Bradley Bylaws contain a provision exempting any and all acquisitions
of Bradley Common Stock from the control share provision of the MGCL, although
there can be no assurance that the provision will not be amended or repealed
in the future.
DISSOLUTION
The MGCL and the Bradley Charter permit the dissolution of Bradley by (i)
the affirmative resolution of a majority of the entire Board of Directors
declaring such dissolution to be advisable and directing that the proposed
dissolution be submitted for consideration at an annual or special meeting of
stockholders, and (ii) upon proper notice, stockholder approval by the
affirmative vote of the holders of a majority of all of the votes entitled to
be cast on the matter.
The dissolution of Tucker would require a similar resolution of Tucker's
Board of Directors and approved by the affirmative vote of the holders of not
less than two-thirds of all of the votes entitled to be cast on the matter.
90
<PAGE>
OTHER MATTERS
It is not expected that any matters other than those described in this
Joint Proxy Statement/Prospectus will be brought before the Bradley Special
Meeting or the Tucker Special Meeting. If any other matters are presented,
however, it is the intention of the persons named in the Bradley proxy and
Tucker proxy to vote the proxy in accordance with their best judgment.
LEGAL MATTERS
Certain legal matters in connection with the Merger and the validity of
the shares of Bradley Common Stock to be issued pursuant to the Merger will be
passed upon for Bradley by Goodwin, Procter & Hoar (a partnership including
professional corporations), Boston, Massachusetts. William B. King, whose
professional corporation is a partner in Goodwin, Procter & Hoar, is Secretary
of Bradley and is the beneficial owner of approximately 8,000 shares of
Bradley Common Stock. Certain legal matters in connection with the Merger will
be passed upon for Tucker by Mayer, Brown & Platt, Chicago, Illinois.
EXPERTS
The financial statements of Bradley as of December 31, 1994 and 1993, and
for each of the years in the three-year period ended December 31, 1994 and the
financial statement schedule as of December 31, 1994, incorporated by
reference in this Joint Proxy Statement/Prospectus have been audited by KPMG
Peat Marwick LLP, independent certified public accountants, as indicated in
their reports with respect thereto, and are included herein in reliance upon
the authority of said firm as experts in accounting and auditing.
The financial statements of Tucker as of December 31, 1994 and 1993, and
for each of the years in the three-year period ended December 31, 1994 and the
financial statement schedule as of December 31, 1994, incorporated by
reference in this Joint Proxy Statement/Prospectus have been audited by
Coopers & Lybrand L.L.P., independent certified public accountants, as
indicated in their reports with respect thereto, and are included herein in
reliance upon the authority of said firm as experts in accounting and
auditing.
STOCKHOLDER PROPOSALS
Any Bradley stockholder who wishes to submit a proposal for presentation
at Bradley's 1996 Annual Meeting of Stockholders must have submitted the
proposal to Bradley Real Estate, Inc., One Exeter Plaza, 699 Boylston Street,
Boston, Massachusetts 02116, Attention: Secretary. Such proposal must have
been received not later than November 30, 1995 for inclusion, if appropriate,
in Bradley's proxy statement and form of proxy relating to its 1996 Annual
Meeting.
Any Tucker stockholder who wishes to submit a proposal for presentation
at Tucker's 1996 Annual Meeting of Stockholders (which would be held only if
the Merger has not been consummated prior to the date the meeting is to be
held) must submit the proposal to Tucker Properties Corporation, 40 Skokie
Boulevard, Suite 600, Northbrook, Illinois 60062, Attention: Shareholder
Relations. Such proposal must be received not later than January 31, 1996 for
inclusion, if appropriate, in Tucker's proxy statement and form of proxy
relating to its 1996 Annual Meeting.
91
<PAGE>
ANNEX A
================================================================================
AGREEMENT AND PLAN OF MERGER
between
BRADLEY REAL ESTATE, INC.
and
TUCKER PROPERTIES CORPORATION
Dated as of October 30, 1995
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
1. The Merger and Amendment of Tucker Partnership Agreement................. A-1
1.1 The Merger........................................................ A-1
1.2 The Closing....................................................... A-1
1.3 Effective Time.................................................... A-2
1.4 Amendment of Tucker Operating Limited Partnership Agreement....... A-2
1.5 Transfer of Securities of Tucker Management Corporation........... A-2
1.6 Amendments of Governing Documents of Tucker Subsidiaries.......... A-2
1.7 Release and Termination........................................... A-3
1.8 Severance Pay Plan and Agreements................................. A-3
2. Charter and Bylaws of the Surviving Corporation.......................... A-3
2.1 Charter........................................................... A-3
2.2 Bylaws............................................................ A-3
3. Directors and Officers of the Surviving Corporation...................... A-3
3.1 Directors......................................................... A-3
3.2 Officers.......................................................... A-4
4. Tucker Stock............................................................. A-4
4.1 Conversion of the Tucker Stock.................................... A-4
4.2 Exchange of Certificates Representing Tucker Common Stock......... A-5
4.3 Return of Exchange Fund........................................... A-7
5. Representations and Warranties of Tucker................................. A-7
5.1 Existence; Good Standing; Authority; Compliance With Law.......... A-7
5.2 Authorization, Validity and Effect of Agreements.................. A-8
5.3 Capitalization.................................................... A-9
5.4 Subsidiaries..................................................... A-11
5.5 Other Interests.................................................. A-11
5.6 No Violation..................................................... A-12
5.7 SEC Documents.................................................... A-12
5.8 Litigation....................................................... A-13
5.9 Absence of Certain Changes....................................... A-13
5.10 Taxes............................................................ A-14
5.11 Books and Records................................................ A-15
5.12 Properties....................................................... A-15
5.13 Leases........................................................... A-17
5.14 Rents............................................................ A-18
5.15 Environmental Matters............................................ A-18
5.16 Employee Benefit Plans........................................... A-19
</TABLE>
(i)
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
5.17 Labor Matters..................................................... A-20
5.18 No Brokers........................................................ A-20
5.19 Opinion of Financial Advisor...................................... A-20
5.20 Bradley Share Ownership........................................... A-20
5.21 Related Party Transactions........................................ A-20
5.22 Contracts and Commitments......................................... A-21
5.23 Development Rights................................................ A-21
5.24 Certain Payments Resulting From Transactions...................... A-21
5.25 Indemnification Claims............................................ A-22
5.26 Disclosure........................................................ A-22
5.27 Status of Holden Court and Holden Court Escrow.................... A-22
5.28 Tenant Improvements............................................... A-22
5.29 Status of Options to Purchase Real Property....................... A-22
5.30 Definition of Tucker's Knowledge.................................. A-23
6. Representations and Warranties of Bradley................................ A-23
6.1 Existence; Good Standing; Authority; Compliance With Law.......... A-23
6.2 Authorization, Validity and Effect of Agreements.................. A-24
6.3 Capitalization.................................................... A-24
6.4 Subsidiaries...................................................... A-25
6.5 Other Interests................................................... A-25
6.6 No Violation...................................................... A-25
6.7 SEC Documents..................................................... A-25
6.8 Litigation........................................................ A-26
6.9 Absence of Certain Changes........................................ A-27
6.10 Taxes............................................................. A-27
6.11 Books and Records................................................. A-28
6.12 Properties........................................................ A-28
6.13 Environmental Matters............................................. A-29
6.14 Employee Benefit Plans............................................ A-30
6.15 Labor Matters..................................................... A-30
6.16 No Brokers........................................................ A-31
6.17 Opinion of Financial Advisor...................................... A-31
6.18 Tucker Stock Ownership............................................ A-31
6.19 Related Party Transactions........................................ A-31
6.20 Contracts and Commitments......................................... A-31
6.21 Development Rights................................................ A-32
6.22 Bradley Common Stock.............................................. A-32
6.23 Convertible Securities............................................ A-32
6.24 Disclosure........................................................ A-32
6.25 Definition of Bradley's Knowledge................................. A-32
7. Covenants................................................................ A-33
</TABLE>
(ii)
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
7.1 Acquisition Proposals............................................. A-33
7.2 Conduct of Businesses............................................. A-34
7.3 Meetings of Stockholders.......................................... A-36
7.4 Filings; Other.................................................... A-37
7.5 Inspection of Records............................................. A-38
7.6 Publicity......................................................... A-38
7.7 Registration Statement............................................ A-38
7.8 Listing Application............................................... A-39
7.9 Further Action.................................................... A-39
7.10 Affiliates of Tucker.............................................. A-39
7.11 Expenses.......................................................... A-40
7.12 Indemnification................................................... A-40
7.13 Reorganization.................................................... A-42
7.14 Certain Benefits.................................................. A-42
7.15 Dividends......................................................... A-43
7.16 IRS Private Letter Ruling......................................... A-44
8. Conditions............................................................... A-44
8.1 Conditions to Each Party's Obligation to Effect the Merger........ A-44
8.2 Conditions to Obligations of Tucker to Effect the Merger.......... A-45
8.3 Conditions to Obligation of Bradley to Effect the Merger.......... A-46
9. Termination.............................................................. A-47
9.1 Termination....................................................... A-47
9.2 Effect of Termination............................................. A-49
9.3 Payment of Termination Amount or Expenses......................... A-50
9.4 Extension; Waiver................................................. A-51
10. General Provisions....................................................... A-51
10.1 Nonsurvival of Representations, Warranties and Agreements......... A-51
10.2 Notices........................................................... A-52
10.3 Assignment; Binding Effect; Benefit............................... A-52
10.4 Entire Agreement.................................................. A-53
10.5 Confidentiality................................................... A-53
10.6 Amendment......................................................... A-54
10.7 Governing Law..................................................... A-54
10.8 Counterparts...................................................... A-54
10.9 Headings.......................................................... A-55
10.10 Interpretation.................................................... A-55
10.11 Waivers........................................................... A-55
10.12 Incorporation..................................................... A-55
10.13 Severability...................................................... A-55
10.14 Enforcement of Agreement.......................................... A-55
10.15 Certain Definitions............................................... A-55
10.16 Schedules......................................................... A-56
</TABLE>
(iii)
<PAGE>
EXHIBIT A - Form of Amended and Restated Agreement of Limited Partnership
of Bradley Operating Limited Partnership Agreement
EXHIBIT B-1 - Consents of Limited Partner of Tucker Operating Limited
Partnership
EXHIBIT B-2 - Consent of General Partner of Tucker Operating Limited
Partnership
EXHIBIT B-3 - Acknowledgment of Bradley Real Estate, Inc. to the Amended and
Restated Agreement of Limited Partnership of Tucker Operating
Limited Partnership
EXHIBIT C - Intentionally Omitted
EXHIBIT D - Form of Affiliate Letter
EXHIBIT E - Form of Tenant's Estoppel Certificate
EXHIBIT F - Purchase and Sale of Securities
EXHIBIT G - Tucker Properties Corporation Severance Pay Plan
EXHIBIT H-1 - Form of First Amendment to Indemnification Agreement
EXHIBIT H-2 - Acknowledgment of Bradley Real Estate, Inc. to the First
Amendment of the Indemnification Agreements
EXHIBIT I - Form of Seventh Amendment to Agreement of Limited Partnership
of Tucker Operating Limited Partnership Agreement
EXHIBIT J - Severance Agreements
EXHIBIT K - Consulting Agreement with Kenneth Tucker
Schedules
- ---------
Schedule 1.7 Contracts to be Released
Schedule 5.2 Ancillary Agreements
Schedule 7.12 Tucker's Directors' and Officers' Insurance Coverage
Schedule 8.1(f) Required Consents
Schedule 8.3(f) Leases and REA Agreements Requiring Estoppel Certificates
(iv)
<PAGE>
AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and entered
into as of October 30, 1995, between Bradley Real Estate, Inc., a Maryland
corporation ("Bradley"), and Tucker Properties Corporation, a Maryland
corporation ("Tucker").
RECITALS
A. The Board of Directors of Bradley and the Board of Directors of
Tucker each have determined that a business combination between Bradley and
Tucker is in the best interests of their respective companies and stockholders
and presents an opportunity for their respective companies to achieve long-term
strategic and financial benefits, and accordingly have agreed to effect the
merger provided for herein upon the terms and subject to the conditions set
forth herein.
B. It is intended that the merger provided for herein, for federal
income tax purposes, shall qualify as a reorganization within the meaning of
Section 368(a)(1)(A) of the Internal Revenue Code of 1986, as amended (the
"Code"), and for financial accounting purposes shall be accounted for as a
"purchase."
C. Bradley and Tucker have each received a fairness opinion from their
respective financial advisors relating to the transactions contemplated hereby
as more fully described herein.
D. Bradley and Tucker desire to make certain representations,
warranties and agreements in connection with the merger.
NOW, THEREFORE, in consideration of the foregoing, and of the
representations, warranties, covenants and agreements contained herein, the
parties hereto hereby agree as follows:
ARTICLE 1
1. The Merger and Amendment of Tucker Partnership Agreement.
--------------------------------------------------------
1.1 The Merger. Subject to the terms and conditions of this Agreement,
----------
at the Effective Time (as defined in Section 1.3 hereof), Tucker shall be merged
with and into Bradley in accordance with this Agreement and the separate
corporate existence of Tucker shall thereupon cease (the "Merger"). Bradley
shall be the surviving corporation in the Merger (sometimes hereinafter referred
to as the "Surviving Corporation"). The Merger shall have the effects specified
in Section 3-114 of the Maryland General Corporation Law (the "MGCL").
1.2 The Closing. Subject to the terms and conditions of this Agreement,
-----------
the closing of the Merger (the "Closing") shall take place (a) at the offices of
Goodwin, Procter & Hoar,
<PAGE>
Exchange Place, Boston, Massachusetts, at 9:00 a.m., local time, on the first
business day immediately following the day on which the last of the conditions
set forth in Article 8 shall be fulfilled or waived in accordance herewith or
(b) at such other time, date or place as the parties hereto may agree. The date
on which the Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Effective Time. If all the conditions to the Merger set forth in
--------------
Article 8 shall have been fulfilled or waived in accordance herewith and this
Agreement shall not have been terminated as provided in Article 9, the parties
hereto shall cause Articles of Merger satisfying the requirements of the MGCL to
be properly executed, verified and delivered for filing in accordance with the
MGCL on the Closing Date. The Merger shall become effective upon the acceptance
for record of the Articles of Merger by the State Department of Assessments and
Taxation of Maryland in accordance with the MGCL or at such later time which the
parties hereto shall have agreed upon and designated in such filing in
accordance with applicable law as the effective time of the Merger (the
"Effective Time").
1.4 Amendment of Tucker Operating Limited Partnership Agreement. As a
-----------------------------------------------------------
result of the consummation of the Merger, Bradley will acquire the general
partnership interests and those limited partnership units ("TOP Units") in the
Tucker Operating Limited Partnership, a Delaware limited partnership ("TOP"),
which are currently owned by Tucker. In connection with the consummation of the
Merger, the Limited Partnership Agreement of TOP (the "TOP Partnership
Agreement") will be amended and restated substantially in the form of Exhibit A
hereto. The execution of such agreement by Tucker will be authorized by a
majority of Tucker's independent directors who are not affiliates of any of the
Limited Partners (as such term is defined in the TOP Partnership Agreement).
Concurrently with the execution of this Agreement, Tucker and Limited Partners
of TOP holding at least TOP Units will execute an agreement in the form of
Exhibit B hereto consenting to, among other things, the Merger and the amendment
and restatement, effective as of the Effective Time, of the TOP Partnership
Agreement.
1.5 Transfer of Securities of Tucker Management Corporation. In
-------------------------------------------------------
connection with the consummation of the Merger, a designee or designees of
Bradley will acquire from Kenneth Tucker and Richard Tucker (collectively, the
"Tuckers") all of the outstanding securities of Tucker Management Corporation
("TMC") (other than securities owned by TOP). Concurrently with the execution of
this Agreement, the Tuckers will execute an agreement in the form of Exhibit F
hereto agreeing, among other things, to such transfer, effective as of the
Effective Time.
1.6 Amendments of Governing Documents of Tucker Subsidiaries. In
--------------------------------------------------------
connection with the Closing, the Articles of Incorporation, Bylaws, partnership
agreements and equivalent documents for the Tucker Subsidiaries (as defined in
Section 5.1 hereof) will be amended to change the name of the entity (and, six
months after the Effective Time, no such entity shall use the name "Tucker") and
to make certain other changes to such documents in order to reflect the Merger
and the transactions contemplated by this Agreement. Tucker and the Tucker
Subsidiaries will take all actions which are necessary to effectuate such
amendments and will use their best efforts to cause all of the stockholders in
any Tucker Subsidiary and all
A-2
<PAGE>
of the partners in any Tucker Subsidiary to approve such amendments and to take
such other actions to effectuate such amendments and the transactions
contemplated by this Agreement as may be reasonably requested by Bradley.
1.7 Release and Termination. Concurrently with the execution of this
-----------------------
Agreement, the parties listed on Schedule 1.7 hereto will execute releases
providing for, among other things, the termination of all contracts and
agreements listed on Schedule 1.7 hereto. Pursuant to such releases, all such
contracts shall be terminated and released, effective as of the Effective Time,
and the parties to such contracts agree to waive any and all rights they may
have under such contracts or agreements.
1.8 Severance Pay Plan and Agreements. In connection with the execution
---------------------------------
of this Agreement, Tucker has adopted the Tucker Properties Corporation
Severance Pay Plan (the "Severance Plan") for its employees, as set forth in
Exhibit G hereto, and, prior to the Effective Time, Tucker will use its
reasonable best efforts to enter into individual employment or severance
agreements (the "Severance Agreements") with the following employees: Kenneth
Tucker, Richard Tucker, Harold Eisenberg, Norris Eber, Larry Tucker and William
Karnes, in the respective forms set forth in Exhibit J hereto and a consulting
agreement with Kenneth Tucker in the form set forth in Exhibit K hereto. Bradley
agrees that after the Effective Time, it will assume and be bound by the terms
of the Severance Plan and Severance Agreements. Prior to the Effective Time, and
as soon as practicable after this Agreement is signed, Tucker shall supply
Bradley with the calculation of the actual severance payments that would be
payable pursuant to the Severance Agreements assuming the covered individual's
employment terminated in a Covered Termination (as defined in the Severance
Agreements).
ARTICLE 2
2. Charter and Bylaws of the Surviving Corporation.
-----------------------------------------------
2.1 Charter. The Charter (as defined in the MGCL) of Bradley in effect
-------
immediately prior to the Effective Time shall be the Charter of the Surviving
Corporation, until duly amended in accordance with applicable law.
2.2 Bylaws. The Bylaws of Bradley in effect immediately prior to the
------
Effective Time shall be the Bylaws of the Surviving Corporation, until duly
amended in accordance with applicable law.
ARTICLE 3
3. Directors and Officers of the Surviving Corporation.
---------------------------------------------------
3.1 Directors. The directors of Bradley immediately prior to the
---------
Effective Time shall be the directors of the Surviving Corporation as of the
Effective Time.
A-3
<PAGE>
3.2 Officers. The officers of Bradley immediately prior to the
--------
Effective Time shall be the officers of the Surviving Corporation as of the
Effective Time.
ARTICLE 4
4. Tucker Stock.
------------
4.1 Conversion of the Tucker Stock.
------------------------------
(a) At the Effective Time, each share of the Common Stock, $.01
par value per share, of Bradley ("Bradley Common Stock") outstanding immediately
prior to the Effective Time shall remain outstanding and shall represent one
share of the Common Stock, $.01 par value per share, of the Surviving
Corporation.
(b) At the Effective Time, each share of Common Stock, par value
$.001 per share, of Tucker (the "Tucker Common Stock") issued and outstanding
immediately prior to the Effective Time (other than those shares of Tucker
Common Stock to be canceled pursuant to Section 4.1(d)) shall, by virtue of the
Merger and without any action on the part of Tucker, Bradley or the holders of
any of the securities of any of these corporations, be converted into the right
to receive 0.665 of a share of Bradley Common Stock; provided, however, that in
the event that at the Effective Time the Closing Price (as such term is
hereinafter defined) of a share of Bradley Common Stock is less than $16 per
share but more than $15.50 per share, then each share of Tucker Common Stock
will be converted into the right to receive that percentage of a share of
Bradley Common Stock (determined to the nearest one-thousandth of a share) as is
determined by dividing $10.64 by the Closing Price; and provided, further, that
in the event that at the Effective Time, the Closing Price of a share of Bradley
Common Stock is $15.50 per share or less, then each share of Tucker Common Stock
will be converted into the right to receive 0.686 of a share of Bradley Common
Stock (the applicable percentage of a share of Bradley Common Stock to be issued
upon such conversion is hereinafter referred to as the "Exchange Ratio"); and
provided further that if between the date of this Agreement and the Effective
Time the outstanding shares of Bradley Common Stock shall have been changed into
a different number of shares or a different class or series, by reason of any
stock dividend, subdivision, reclassification, recapitalization, split,
combination or exchange of shares, the Exchange Ratio shall be correspondingly
adjusted to reflect such stock dividend, subdivision, reclassification,
recapitalization, split, combination or exchange of shares. For purposes of this
Agreement, the term "Closing Price" shall mean the average per share closing
price of Bradley Common Stock as reported on the New York Stock Exchange
("NYSE") over the twenty (20) trading days immediately preceding the fifth (5th)
day prior to the date of the Closing.
(c) As a result of the Merger and without any action on the part
of the holder thereof, at the Effective Time, all shares of Tucker Common Stock
shall cease to be outstanding, shall be canceled and retired and shall cease to
exist and each holder of a certificate (a "Certificate") representing any shares
of Tucker Common Stock shall thereafter cease to have any rights with respect to
such shares of Tucker Common Stock, except the right
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to receive, without interest, shares of Bradley Common Stock and cash in lieu of
fractional shares of Bradley Common Stock in accordance with Sections 4.1(b) and
4.2(e) upon the surrender of such Certificate.
(d) Each share of Tucker Common Stock issued and held in Tucker's
treasury at the Effective Time, if any, by virtue of the Merger, shall cease to
be outstanding, shall be canceled and retired and shall cease to exist and no
payment of any consideration shall be made with respect thereto.
(e) At the Effective Time, Tucker's obligations with respect to
each stock option set forth in Section 5.3 of the Tucker Disclosure Letter (as
defined in Article 5 hereof) that will not automatically terminate by its terms
at the Effective Time (the "Existing Tucker Options") shall be assumed by
Bradley (the "Assumed Options"), subject to the provisions and amendments
described in this Section. The Assumed Options shall continue to have, and be
subject to, the same terms and conditions as set forth in the stock option plans
and agreements (as in effect immediately prior to the Effective Time) pursuant
to which the Existing Tucker Options were issued, except that (i) all references
to Tucker shall be deemed to be references to Bradley, (ii) each option shall be
exercisable for that number of whole shares of Bradley Common Stock equal to the
product of the number of shares of Tucker Common Stock covered by such option
immediately prior to the Effective Time multiplied by the Exchange Ratio and
rounded to the nearest whole number of shares of Bradley Common Stock and (iii)
the exercise price per share of Bradley Common Stock under such option shall be
equal to the exercise price per share of Tucker Common Stock under the Existing
Tucker Option divided by the Exchange Ratio and rounded to the nearest cent. The
adjustment provided herein with respect to any Existing Tucker Options that are
"incentive stock options" (as defined in Section 422 of the Code) shall be and
is intended to be effected in a manner that is consistent with Section 424(a) of
the Code. Bradley shall (i) reserve for issuance the number of shares of Bradley
Common Stock that will become issuable upon the exercise of such Assumed Options
pursuant to this Section 4.1(e) and (ii) promptly after the Effective Time issue
to each holder of an outstanding Existing Tucker Option a document evidencing
the assumption by Bradley of Tucker's obligations with respect thereto under
this Section. Nothing in this Section or this Agreement shall affect the
schedule of vesting as set forth in Section 5.3 of the Tucker Disclosure Letter
with respect to Tucker Stock Options to be assumed by Bradley as provided in
this Section.
4.2 Exchange of Certificates Representing Tucker Common Stock.
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(a) As of the Effective Time, Bradley shall deposit, or shall
cause to be deposited, with an exchange agent selected by Bradley on or prior to
the Effective Time (the "Exchange Agent"), for the benefit of the holders of
shares of Tucker Common Stock, for exchange in accordance with this Article 4,
certificates representing the shares of Bradley Common Stock and the cash in
lieu of fractional shares (such cash and certificates for shares of Bradley
Common Stock being hereinafter referred to as the "Exchange Fund") to be issued
pursuant to Section 4.1 and paid pursuant to this Section 4.2 in exchange for
outstanding shares of Tucker Common Stock.
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(b) Promptly after the Effective Time, Bradley shall cause the
Exchange Agent to mail to each holder of record of a Certificate or Certificates
(i) a letter of transmittal which shall specify that delivery shall be effected,
and risk of loss and title to the Certificates shall pass, only upon delivery of
the Certificates to the Exchange Agent and shall be in such form and have such
other provisions as Bradley may reasonably specify and (ii) instructions for use
in effecting the surrender of the Certificates in exchange for certificates
representing shares of Bradley Common Stock and cash in lieu of fractional
shares. Upon surrender of a Certificate for cancellation to the Exchange Agent
together with such letter of transmittal, duly executed and completed in
accordance with the instructions thereto, the holder of such Certificate shall
be entitled to receive in exchange therefor (x) a certificate representing the
number of whole shares of Bradley Common Stock to which such holder shall be
entitled, and (y) a check representing the amount of cash in lieu of fractional
shares, if any, plus the amount of any dividends, or distributions, if any,
pursuant to paragraph (c) below, after giving effect to any required withholding
tax, and the Certificate so surrendered shall forthwith be canceled. No interest
will be paid or accrued on the cash in lieu of fractional shares or on the
dividend or distribution, if any, payable to holders of Certificates pursuant to
this Section 4.2. In the event of a transfer of ownership of Tucker Common Stock
which is not registered in the transfer records of Tucker, a Certificate
representing the proper number of shares of Bradley Common Stock, together with
a check for the cash to be paid in lieu of fractional shares plus, to the extent
applicable, the amount of any dividend or distribution, if any, payable pursuant
to paragraph (c) below, may be issued to such a transferee if the Certificate
representing shares of such Tucker Common Stock is presented to the Exchange
Agent, accompanied by all documents required to evidence and effect such
transfer and to evidence that any applicable stock transfer taxes have been
paid.
(c) Notwithstanding any other provisions of this Agreement, no
dividends or other distributions on Bradley Common Stock shall be paid with
respect to any shares of Tucker Common Stock represented by a Certificate until
such Certificate is surrendered for exchange as provided herein; provided,
however, that subject to the effect of applicable laws, following surrender of
any such Certificate, there shall be paid to the holder of the certificates
representing whole shares of Bradley Common Stock issued in exchange therefor,
without interest, (i) at the time of such surrender, the amount of dividends or
other distributions with a record date after the Effective Time theretofore
payable with respect to such whole shares of Bradley Common Stock and not paid,
less the amount of any withholding taxes which may be required thereon, and (ii)
at the appropriate payment date, the amount of dividends or other distributions
with a record date after the Effective Time but prior to surrender and a payment
date subsequent to surrender payable with respect to such whole shares of
Bradley Common Stock, less the amount of any withholding taxes which may be
required thereon.
(d) At and after the Effective Time, there shall be no transfers
on the stock transfer books of Tucker of the shares of Tucker Common Stock which
were outstanding immediately prior to the Effective Time. If, after the
Effective Time, Certificates are presented to the Surviving Corporation, they
shall be canceled and exchanged for certificates for shares of Bradley Common
Stock and cash in lieu of fractional shares, if any, in accordance with this
Section 4.2. Certificates surrendered for exchange by any person constituting an
"affiliate" of Tucker for purposes of Rule 145, as such rule may be amended
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from time to time ("Rule 145"), of the rules and regulations promulgated under
the Securities Act of 1933, as amended (the "Securities Act"), shall not be
exchanged until Bradley has received an Affiliate Letter in the form of Exhibit
D attached hereto, from such person as provided in Section 7.10.
(e) No fractional shares of Bradley Common Stock shall be issued
pursuant hereto. In lieu of the issuance of any fractional share of Bradley
Common Stock pursuant to Section 4.1(b), each holder of Tucker Common Stock upon
surrender of a Certificate for exchange shall be paid an amount in cash (without
interest), rounded to the nearest cent, determined by multiplying (i) the
Closing Price by (ii) the fraction of a share of Bradley Common Stock which such
holder would otherwise be entitled to receive under this Article 4.
4.3 Return of Exchange Fund. Any portion of the Exchange Fund
-----------------------
(including the proceeds of any investments thereof and any shares of Bradley
Common Stock) that remains unclaimed by the former stockholders of Tucker one
year after the Effective Time shall be delivered to the Surviving Corporation.
Any former stockholders of Tucker who have not theretofore complied with this
Article 4 shall thereafter look only to the Surviving Corporation for payment of
their shares of Bradley Common Stock and cash in lieu of fractional shares (plus
dividends and distributions to the extent set forth in Section 4.2(c), if any),
as determined pursuant to this Agreement, without any interest thereon. None of
Bradley, Tucker, the Exchange Agent or any other person shall be liable to any
former holder of shares of Tucker Common Stock for any amount properly delivered
to a public official pursuant to applicable abandoned property, escheat or
similar laws. In the event any Certificate shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person claiming
such Certificate to be lost, stolen or destroyed and, if required by the
Surviving Corporation, the posting by such person of a bond in such reasonable
amount as the Surviving Corporation may direct as indemnity against any claim
that may be made against it with respect to such Certificate, the Exchange Agent
or the Surviving Corporation will issue in exchange for such lost, stolen or
destroyed Certificate the shares of Bradley Common Stock and cash in lieu of
fractional shares (plus, to the extent applicable, dividends and distributions
payable pursuant to Section 4.2(c)).
ARTICLE 5
5. Representations and Warranties of Tucker.
----------------------------------------
Except as set forth in the disclosure letter delivered at or prior to the
execution hereof to Bradley, which shall refer to the relevant Sections of this
Agreement (the "Tucker Disclosure Letter"), Tucker represents and warrants to
Bradley as follows:
5.1 Existence; Good Standing; Authority; Compliance With Law. Tucker is
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a corporation duly incorporated, validly existing and in good standing under the
laws of the State of Maryland. Tucker is duly licensed or qualified to do
business as a foreign corporation and is in good standing under the laws of any
other state of the United States in which the character of the properties owned
or leased by it therein or in which the transaction of its
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business makes such qualification necessary, except where the failure to be so
licensed or qualified would not have a material adverse effect on the business,
results of operations or financial condition of Tucker and the Tucker
Subsidiaries (as defined below) taken as a whole (a "Tucker Material Adverse
Effect"). Tucker has all requisite corporate power and authority to own,
operate, lease and encumber its properties and carry on its business as now
conducted. Each of the Tucker Subsidiaries is a corporation or partnership duly
incorporated or organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation or organization, has the corporate or
partnership power and authority to own its properties and to carry on its
business as it is now being conducted, and is duly qualified to do business and
is in good standing in each jurisdiction in which the ownership of its property
or the conduct of its business requires such qualification, except for
jurisdictions in which such failure to be so qualified or to be in good standing
would not have a Tucker Material Adverse Effect. Neither Tucker nor any of the
Tucker Subsidiaries is in violation of any order of any court, governmental
authority or arbitration board or tribunal, or any law, ordinance, governmental
rule or regulation to which Tucker or any Tucker Subsidiary or any of their
respective properties or assets is subject, where such violation would have a
Tucker Material Adverse Effect. Tucker and the Tucker Subsidiaries have obtained
all licenses, permits and other authorizations and have taken all actions
required by applicable law or governmental regulations in connection with their
business as now conducted, where the failure to obtain any such license, permit
or authorization or to take any such action would have a Tucker Material Adverse
Effect. Copies of the Charter or other equivalent documents, Bylaws,
organizational documents and partnership and joint venture agreements (and in
each such case, all amendments thereto) of Tucker and each of the Tucker
Subsidiaries are listed in Section 5.1 of the Tucker Disclosure Letter, and the
copies of such documents, which have previously been delivered or made available
to Bradley and its counsel, are true and correct. For the purposes of this
Agreement, the term "Tucker Subsidiary" shall include any of the entities listed
under such heading in Section 5.4 of the Tucker Disclosure Letter.
5.2 Authorization, Validity and Effect of Agreements. Each of Tucker
------------------------------------------------
and the Tucker Subsidiaries has the requisite power and authority to enter into
the transactions contemplated hereby and to execute and deliver this Agreement
and the agreements and documents listed in Schedule 5.2 to this Agreement (the
"Ancillary Agreements") to which it is a party. The Board of Directors of Tucker
has, by resolutions duly adopted by unanimous vote, approved this Agreement, the
Merger and the transactions contemplated by this Agreement and has agreed to
recommend that the holders of Tucker Common Stock adopt and approve this
Agreement, the Merger and the transactions contemplated by this Agreement at the
Tucker stockholders' meeting which will be held in accordance with the
provisions of Section 7.3. In connection with the foregoing, the Board of
Directors of Tucker has taken such actions and votes as are necessary on its
part to render the provisions of the Control Share Acquisition Statute, the
Business Combination Statute and all other applicable takeover statutes of the
MGCL and any other applicable takeover statutes of any other state, inapplicable
to this Agreement, the Merger and the transactions contemplated by this
Agreement. As of the date hereof, all of the directors and executive officers of
Tucker have indicated that they presently intend to vote all shares of Tucker
Common Stock which they own to approve this Agreement, the Merger, and the
transactions contemplated by this Agreement at the Tucker stockholders meeting
which will be held in accordance with the
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provisions of Section 7.3. Subject only to the approval of this Agreement and
the transactions contemplated hereby by the holders of two-thirds of the
outstanding shares of Tucker Common Stock, the execution by Tucker and the
Tucker Subsidiaries of this Agreement, the Ancillary Agreements to which they
are parties and the consummation of the transactions contemplated by this
Agreement and the Ancillary Agreements has been duly authorized by all requisite
corporate or partnership action on the part of such entities. This Agreement
constitutes, and the Ancillary Agreements to which they are parties (when
executed and delivered pursuant hereto) will constitute, the valid and legally
binding obligations of Tucker and the Tucker Subsidiaries, enforceable against
Tucker and each of the Tucker Subsidiaries in accordance with their respective
terms, subject to applicable bankruptcy, insolvency, moratorium or other similar
laws relating to creditors' rights and general principles of equity.
5.3 Capitalization.
--------------
(a) The authorized capital stock of Tucker consists of 90,000,000
shares of Tucker Common Stock and 10,000,000 shares of preferred stock, $.001
par value per share (the "Tucker Preferred Stock"). As of the date hereof, there
are 10,828,283 shares of Tucker Common Stock issued and outstanding, and no
shares of Tucker Preferred Stock are issued and outstanding. All such issued and
outstanding shares of Tucker Common Stock are duly authorized, validly issued,
fully paid, nonassessable and free of preemptive rights. Except for the TOP
Units and the Existing Tucker Options, Tucker has no outstanding bonds,
debentures, notes or other obligations the holders of which have the right to
vote (or which are convertible into or exercisable for securities having the
right to vote) with the stockholders of Tucker on any matter. Except for the TOP
Units and the Existing Tucker Options (all of which have been issued under the
Tucker Properties Corporation 1993 Share Option Plan (the "Tucker Stock Option
Plan")), there are not at the date of this Agreement any existing options,
warrants, calls, subscriptions, convertible securities, or other rights,
agreements or commitments which obligate Tucker to issue, transfer or sell any
shares of capital stock of Tucker. Section 5.3 of the Tucker Disclosure Letter
sets forth a full list of the Existing Tucker Options, including the name of the
person to whom such stock options have been granted, the number of shares
subject to each option, the per share exercise price for each option and the
vesting schedule for each option. Except as set forth in Section 5.3 of the
Tucker Disclosure Letter, the vesting schedule of all Existing Tucker Options
shall not be changed or affected by the execution of this Agreement or the
Ancillary Agreements or the consummation of the transactions contemplated by
this Agreement or the Ancillary Agreements. Pursuant to the terms of the Tucker
Stock Option Plan, at the Effective Time, all Existing Tucker Options will be
assumed by Bradley in accordance with the provisions of Section 4.1(e). Except
as set forth in Section 5.3 of the Tucker Disclosure Letter, there are no
agreements or understandings to which Tucker or any Tucker Subsidiary is a party
with respect to the voting of any shares of Tucker Common Stock or which
restrict the transfer of any such shares, nor does Tucker have knowledge of any
such agreements or understandings with respect to the voting of any such shares
or which restrict the transfer of any such shares. Except for TOP Units held by
Limited Partners, there are no outstanding contractual obligations of Tucker or
any Tucker Subsidiary to repurchase, redeem or otherwise acquire any shares of
capital stock, partnership interests or any other securities of Tucker or any
Tucker Subsidiary. Except as set forth in Section 5.3 of the Tucker Disclosure
Letter, neither
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Tucker nor any Tucker Subsidiary is under any obligation, contingent or
otherwise, by reason of any agreement to register any of their securities under
the Securities Act. After the Effective Time, except to the extent set forth in
Section 4.1(e), the Surviving Corporation will have no obligation to issue,
transfer or sell any shares of capital stock or other equity interest of Tucker
or the Surviving Corporation pursuant to any Tucker Stock Option Plan or any
other Tucker Benefit Plan (as defined in Section 5.16 hereof).
(b) The sole general partner of TOP is Tucker. As of the date
hereof, there are issued and outstanding 11,287,100 TOP Units, 10,828,283 of
which are owned by Tucker and the remainder of which are owned by the persons
and in the amounts set forth in Section 5.3 of the Tucker Disclosure Letter. All
such issued and outstanding TOP Units are duly authorized, validly issued, fully
paid, and free of preemptive rights. The TOP Units owned by Tucker and, to the
best knowledge of Tucker, the TOP Units owned by the Limited Partners, are
subject only to the restrictions on transfer set forth in the TOP Partnership
Agreement and those imposed by applicable securities laws. Except as set forth
in Section 5.3 of the Tucker Disclosure Letter, TOP has not issued or granted,
and is not a party to, any commitments of any kind relating to, or any
agreements or understandings with respect to, TOP Units or any other interest in
TOP or any securities convertible into TOP Units or such interests.
(c) TOP and Tucker Financing Corporation, a Delaware corporation
("TFC"), are the only partners in Tucker Financing Partnership, a Delaware
partnership ("TFP"). As of the date hereof and at all times during its
existence, TFC is and has been a wholly-owned subsidiary of Tucker, which owns
all of the 100 issued and outstanding shares of common stock, par value $.01 per
share, of TFC. As of the date hereof, 99% of the issued and outstanding units of
partnership interests in TFP ("TFP Units"), are held by TOP and 1% are held by
TFC. All such issued and outstanding TFP Units are duly authorized, validly
issued, fully paid, and free of preemptive rights. The TFP Units are subject
only to the restrictions on transfer set forth in the TOP Partnership Agreement,
the partnership agreement of TFP and that certain Indenture, dated as of June 1,
1994, by and between TFP, Bankers Trust Company of California, N.A. and Bankers
Trust (the "Indenture") and those imposed by applicable securities laws. TFP has
not otherwise issued or granted, and is not a party to, any commitments of any
kind relating to, or any agreements or understandings with respect to, TFP Units
or any other interest in TFP or any securities convertible into TFP Units or
such interests. TFP has financed all of the properties which it owns through a
transaction which, as of the date hereof, qualifies as a real estate mortgage
investment conduit (a "REMIC") under Section 860D of the Code. As part of the
REMIC, TFP issued a $100,000,000 interest-bearing promissory note to a certain
trust, which is governed by the Indenture. As of the date hereof, TFP has
complied with all of the covenants contained in Section 1008 and Section 1009 of
the Indenture and no Default or Event of Default (as defined in the Indenture),
or any event the occurrence of which, with notice or lapse of time, will become
a Default or Event of Default under Article 5 of the Indenture, has occurred or
is occurring. The execution of this Agreement and the Ancillary Agreements and
the consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements will not violate or result in a violation of the covenants
in Section 1008 and Section 1009 of the Indenture (subject to the receipt of the
consent of the Indenture Trustee) and will not result in a default or Event of
Default (as defined in the Indenture), or any event the occurrence of which,
with notice or
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lapse of time, will become a Default or Event of Default under Article 5 of the
Indenture. TFP is not subject to regulation under the Public Utility Holding
Company Act of 1935 or the Federal Power Act and neither TFP or TOP is required
to be registered as an "investment company" within the meaning of the Investment
Company Act of 1940. The beneficial ownership of this trust is represented by
413 certificates in six different classes (A, B, C, D, E and R). The Class A,
Class B, Class C, Class D and Class E certificates qualify for treatment as
"regular interests" in the REMIC. The Class R certificates represent the sole
class of "residual interests" in the REMIC.
5.4 Subsidiaries. Except as set forth in Section 5.4 of the Tucker
------------
Disclosure Letter, Tucker owns directly or indirectly each of the outstanding
shares of capital stock or all of the partnership or other equity interests of
each of the Tucker Subsidiaries. Each of the outstanding shares of capital stock
in each of the Tucker Subsidiaries having corporate form is duly authorized,
validly issued, fully paid and nonassessable. Except as set forth in Section 5.4
of the Tucker Disclosure Letter, each of the outstanding shares of capital stock
of, or partnership or other equity interests in, each of the Tucker Subsidiaries
is owned, directly or indirectly, by Tucker free and clear of all liens,
pledges, security interests, claims or other encumbrances. The following
information for each Tucker Subsidiary is set forth in Section 5.4 of the Tucker
Disclosure Letter: (i) its name and jurisdiction of incorporation or
organization; (ii) its authorized capital stock or share capital or partnership
or other interests; (iii) the name of each stockholder or owner of a partnership
or other equity interest and the number of issued and outstanding shares of
capital stock or share capital or percentage ownership for non-corporate
entities held by it and (iv) the name of the general partners, if applicable.
TFC and Tucker Properties Investment, Inc. are the only Tucker Subsidiaries
which are "qualified REIT subsidiaries" as such term is defined under Section
856(i) of the Code.
5.5 Other Interests. Except for interests in the Tucker Subsidiaries as
---------------
set forth in Section 5.4 of the Tucker Disclosure Letter, neither Tucker nor any
Tucker Subsidiary owns directly or indirectly any interest or investment
(whether equity or debt) in any corporation, partnership, joint venture, trust
or other entity (other than investments in short-term investment securities).
With respect to the interests set forth in Section 5.4 of the Tucker Disclosure
Letter, Tucker or the applicable Tucker Subsidiary, as the case may be, is a
partner or stockholder in good standing, owns such interests free and clear of
all liens, pledges, security interests, claims, options or other encumbrances,
is not in breach of any provision of any agreement, document or contract
governing such entity's rights in or to the interests owned or held, all of
which agreements, documents and contracts are set forth in Section 5.4 of the
Tucker Disclosure Letter, and have not been modified or amended since their
description therein, and are in full force and effect and, to the best of the
knowledge of Tucker, the other parties to such agreements, documents or
contracts are not in breach of any of their respective obligations under such
agreements, documents or contracts, and to the best of the knowledge of Tucker,
if such other entities were included within the definition of Tucker
Subsidiaries for purposes of this Agreement, there would be no exceptions or
breaches to the representations and warranties made in this Article for Tucker
Subsidiaries.
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5.6 No Violation. Except as set forth in Section 5.6 of the Tucker
------------
Disclosure Letter, neither the execution and delivery by Tucker and the Tucker
Subsidiaries of this Agreement or the Ancillary Agreements nor the consummation
by Tucker and the Tucker Subsidiaries of the transactions contemplated by this
Agreement and the Ancillary Agreements in accordance with their terms, will: (i)
conflict with or result in a breach of any provisions of the Charter, Bylaws,
organizational documents, partnership agreements, or joint venture agreements of
Tucker or any Tucker Subsidiary; (ii) result in a breach or violation of, a
default under, or the triggering of any payment or other material obligations
pursuant to, or accelerate vesting under, the Tucker Stock Option Plan, or any
grant or award made thereunder; (iii) violate, or conflict with, or result in a
breach of any provision of, or constitute a default (or an event which, with
notice or lapse of time or both, would constitute a default) under, or result in
the termination or in a right of termination or cancellation of, or accelerate
the performance required by, or result in the creation of any lien, security
interest, charge or encumbrance upon any of the properties of Tucker or the
Tucker Subsidiaries under, or result in being declared void, voidable or without
further binding effect, any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, deed of trust or any license, franchise, permit,
lease, contract, agreement or other instrument, commitment or obligation to
which Tucker or any of the Tucker Subsidiaries is a party, or by which Tucker or
any of the Tucker Subsidiaries or any of their properties is bound or affected,
except for any of the foregoing matters which, individually or in the aggregate,
would not have a Tucker Material Adverse Effect; or (iv) other than the filings
provided for in Article 1 of this Agreement, or required under the Hart-Scott-
Rodino Antitrust Improvements Act of 1976 (the "HSR Act"), the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), the Securities Act or
applicable state securities and "Blue Sky" laws (collectively, the "Regulatory
Filings"), require any consent, approval or authorization of, or declaration,
filing or registration with, any governmental or regulatory authority, except
where the failure to obtain any such consent, approval or authorization of, or
declaration, filing or registration with, any governmental or regulatory
authority would not have a Tucker Material Adverse Effect.
5.7 SEC Documents. A complete list of the registration statements of
-------------
Tucker filed with the United States Securities and Exchange Commission ("SEC")
in connection with Tucker's initial public offering of Tucker Common Stock, and
all exhibits, amendments and supplements thereto (the "Tucker Registration
Statement"), and each (A) registration statement, (B) annual report on Form 10-
K, (C) quarterly report on Form 10-Q, (D) current report on Form 8-K, (E) proxy
statement or information statement, and (F) other reports filed with the SEC
pursuant to the requirements of the Exchange Act (in all such cases, including
all exhibits, amendments and supplements thereto), prepared by Tucker or any of
the Tucker Subsidiaries or relating to properties of Tucker or the Tucker
Subsidiaries (including registration statements covering mortgage pass-through
certificates) since the effective date of the Tucker Registration Statement, is
set forth in Section 5.7 of the Tucker Disclosure Letter, and copies of such
documents, in the form (including exhibits and any amendments thereto) filed
with the SEC, have previously been provided or made available to Bradley or its
counsel (collectively, the "Tucker Reports"). The Tucker Reports were filed with
the SEC in a timely manner and constitute all forms, reports and documents
required to be filed by Tucker under the Securities Act, the Exchange Act and
the rules and regulations promulgated thereunder (the "Securities Laws"). As of
their respective dates, the Tucker Reports (i) complied as to form
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in all material respects with the applicable requirements of the Securities Laws
and (ii) did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading. Each of the consolidated balance sheets of Tucker included
in or incorporated by reference into the Tucker Reports (including the related
notes and schedules) fairly presents the consolidated financial position of
Tucker and the Tucker Subsidiaries as of its date and each of the consolidated
statements of income, retained earnings and cash flows of Tucker included in or
incorporated by reference into the Tucker Reports (including any related notes
and schedules) fairly presents the results of operations, retained earnings or
cash flows, as the case may be, of Tucker and the Tucker Subsidiaries for the
periods set forth therein (subject, in the case of unaudited statements, to
normal year-end audit adjustments which would not be material in amount or
effect), in each case in accordance with generally accepted accounting
principles consistently applied during the periods involved, except as may be
noted therein and except, in the case of the unaudited statements, as permitted
by Form 10-Q of the SEC. Except as and to the extent set forth on the
consolidated balance sheet of Tucker and the Tucker Subsidiaries at December 31,
1994, including all notes thereto, or as set forth in the Tucker Reports or in
Section 5.7 of the Tucker Disclosure Letter, neither Tucker nor any of the
Tucker Subsidiaries has any material liabilities or obligations of any nature
(whether accrued, absolute, contingent or otherwise) that would be required to
be reflected on, or reserved against in, a balance sheet of Tucker or in the
notes thereto, prepared in accordance with generally accepted accounting
principles consistently applied, except liabilities arising in the ordinary
course of business since such date and liabilities for expenses of attorneys,
accountants and investment bankers incurred in connection with the Merger.
5.8 Litigation. There are (i) no continuing orders, injunctions or
----------
decrees of any court, arbitrator or governmental authority to which Tucker or
any Tucker Subsidiary is a party or by which any of its properties or assets are
bound or, to the reasonable best knowledge of Tucker, to which any of its
directors, officers, employees or agents is a party or by which any of their
properties or assets are bound, and (ii) no actions, suits or proceedings
pending against Tucker or any Tucker Subsidiary or, to the reasonable best
knowledge of Tucker, against any of its directors, officers, employees or agents
or, to the reasonable best knowledge of Tucker, threatened against Tucker or any
Tucker Subsidiary or against any of its directors, officers, employees or
agents, at law or in equity, or before or by any federal or state commission,
board, bureau, agency or instrumentality, that in the case of clause (i) or
(ii), are reasonably likely, individually or in the aggregate, to have a Tucker
Material Adverse Effect.
5.9 Absence of Certain Changes. Except as disclosed in the Tucker
--------------------------
Reports filed with the SEC prior to the date hereof or as set forth in Section
5.9 of the Tucker Disclosure Letter, since December 31, 1994, Tucker and the
Tucker Subsidiaries have conducted their business only in the ordinary course of
such business and there has not been (i) any Tucker Material Adverse Effect;
(ii) as of the date hereof, any declaration, setting aside or payment of any
dividend or other distribution with respect to the Tucker Common Stock, except
dividends of $0.36 per share paid on January 16, 1995 and April 14, 1995 and
$0.25 per share paid on July 14, 1995 and October 16, 1995, (iii) any material
commitment, contractual obligation,
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borrowing, capital expenditure or transaction (each, a "Commitment") entered
into by Tucker or any of the Tucker Subsidiaries, outside the ordinary course of
business except for commitments for expenses of attorneys, accountants and
investment bankers incurred in connection with the Merger; or (iv) any material
change in Tucker's accounting principles, practices or methods.
5.10 Taxes. Except as set forth in Section 5.10 of the Tucker Disclosure
-----
Letter:
(a) Tucker and each of the Tucker Subsidiaries has paid or caused
to be paid all federal, state, local, foreign, and other taxes, including
without limitation, income taxes, estimated taxes, alternative minimum taxes,
excise taxes, sales taxes, use taxes, value-added taxes, gross receipts taxes,
franchise taxes, capital stock taxes, employment and payroll-related taxes,
withholding taxes, stamp taxes, transfer taxes, windfall profit taxes,
environmental taxes and property taxes, whether or not measured in whole or in
part by net income, and all deficiencies, or other additions to tax, interest,
fines and penalties (collectively, "Taxes"), owed by it through the date hereof.
(b) Tucker and each of the Tucker Subsidiaries has timely filed
all federal, state, local and foreign tax returns required to be filed by any of
them through the date hereof, and all such returns completely and accurately set
forth the amount of any Taxes relating to the applicable period.
(c) Neither the Internal Revenue Service ("IRS") nor any other
governmental authority is now asserting by written notice to Tucker or any
Tucker Subsidiary or, to the knowledge of Tucker or the Tucker Subsidiaries,
threatening to assert against Tucker or any Tucker Subsidiary any deficiency or
claim for additional Taxes. There is no dispute or claim concerning any Tax
liability of Tucker or any Tucker Subsidiary, either claimed or raised by any
governmental authority, or as to which any officer of Tucker or any Tucker
Subsidiary has reason to believe may be claimed or raised by any federal or
state governmental authority. No claim has ever been made by a taxing authority
in a jurisdiction where Tucker does not file reports and returns that Tucker is
or may be subject to taxation by that jurisdiction. There are no security
interests on any of the assets of Tucker or any Tucker Subsidiary that arose in
connection with any failure (or alleged failure) to pay any Taxes. Other than
the agreement dated June 5, 1995, (the "1995 Closing Agreement") Tucker has
never entered into a closing agreement pursuant to Section 7121 of the Code.
(d) Except as to matters in connection with the 1995 Closing
Agreement, Tucker has not received written notice of any audit of any tax return
filed by Tucker, and Tucker has not been notified by any tax authority that any
such audit is contemplated or pending. Neither Tucker nor any of the Tucker
Subsidiaries has executed or filed with the IRS or any other taxing authority
any agreement now in effect extending the period for assessment or collection of
any income or other taxes, and no extension of time with respect to any date on
which a tax return was or is to be filed by Tucker is in force. True, correct
and complete copies of all federal, state and local income or franchise tax
returns filed by Tucker and each of the Tucker Subsidiaries and all
communications relating thereto have been delivered to Bradley or made available
to representatives of Bradley.
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<PAGE>
(e) Tucker and each Tucker Subsidiary has withheld and paid all
taxes required to have been withheld and paid in connection with amounts paid or
owing to any employee, independent contractor, creditor, stockholder or other
party.
(f) Each of the Tucker Subsidiaries of which all the outstanding
capital stock is owned solely by Tucker is a Qualified REIT Subsidiary as
defined in Section 856(i) of the Code. TOP, TFP and each of the other Tucker
Subsidiaries listed as a partnership in Section 5.4 of the Tucker Disclosure
Letter are, and have been at all times, properly classified as partnerships for
federal income tax purposes and not as publicly-traded partnerships.
(g) For its taxable year ended December 31, 1993, Tucker made all
federal and applicable state and local elections to qualify as a real estate
investment trust. None of such elections has been terminated or revoked. For its
taxable year ended December 31, 1993 and at all times thereafter up to and
including the date hereof, Tucker has qualified to be treated as a real estate
investment trust ("REIT") within the meaning of Sections 856-860 of the Code,
including, without limitation, the requirements of Sections 856 and 857 of the
Code. Tucker has qualified as a REIT for every year in which it existed. For the
periods described in the preceding sentence, Tucker has met all requirements
necessary to be treated as a REIT for purposes of the income tax provisions of
those states in which Tucker is subject to income tax and which provide for the
taxation of REITs in a manner similar to the treatment of REITs under Sections
856-860 of the Code.
5.11 Books and Records.
-----------------
(a) The books of account and other financial records of Tucker and
each of the Tucker Subsidiaries are true, complete and correct in all material
respects, have been maintained in accordance with good business practices, and
are accurately reflected in all material respects in the financial statements
included in the Tucker Reports.
(b) The minute books and other records of Tucker and each of the
Tucker Subsidiaries have been made available to Bradley, contain in all material
respects accurate records of all meetings and accurately reflect in all material
respects all other corporate action of the stockholders and directors and any
committees of the Board of Directors of Tucker and each of the Tucker
Subsidiaries and all actions of the partners of each of the Tucker Subsidiaries.
5.12 Properties. All of the real estate properties owned by Tucker and
----------
each of the Tucker Subsidiaries are set forth in Section 5.12 of the Tucker
Disclosure Letter. Except as set forth in Section 5.12 of the Tucker Disclosure
Letter, Tucker and each Tucker Subsidiary own fee simple title to each of the
real properties identified in the Tucker Disclosure Letter (the "Tucker
Properties"), free and clear of liens, mortgages or deeds of trust, claims
against title, charges which are liens, security interests or other encumbrances
on title (collectively, "Encumbrances") and the Tucker Properties are not
subject to any rights of way, written agreements, laws, ordinances and
regulations affecting building use or occupancy, or reservations of an interest
in title (collectively, "Property Restrictions"), except for (i) Property
Restrictions imposed or promulgated by law or any governmental body or authority
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<PAGE>
with respect to real property, including zoning regulations, that do not
adversely affect the current use of the property, materially detract from the
value of or materially interfere with the present use of the property, (ii)
Encumbrances and Property Restrictions disclosed on existing title reports or
current surveys (in either case copies of which title reports and surveys have
been delivered or made available to Bradley and are listed in Section 5.12 of
the Tucker Disclosure Letter), and (iii) mechanics', carriers', workmen's or
repairmen's liens and other Encumbrances, Property Restrictions and other
limitations of any kind, if any, which, individually or in the aggregate, are
not material in amount, do not materially detract from the value of or
materially interfere with the present use of any of the Tucker Properties
subject thereto or affected thereby, and do not otherwise materially impair
business operations conducted by Tucker and the Tucker Subsidiaries and which
have arisen or been incurred only in the ordinary course of business. Except as
set forth in Section 5.12 of the Tucker Disclosure Letter, valid policies of
title insurance have been issued insuring Tucker's or the applicable Tucker
Subsidiary's fee simple title to each of the Tucker Properties in amounts at
least equal to the purchase price thereof, and such policies are, at the date
hereof, in full force and effect and no claim has been made against any such
policy and Tucker has no knowledge of any facts or circumstances which would
constitute the basis for such a claim. To the best knowledge of Tucker, (i) no
certificate, permit or license from any governmental authority having
jurisdiction over any of the Tucker Properties or any agreement, easement or
other right which is necessary to permit the lawful use and operation of the
buildings and improvements on any of the Tucker Properties or which is necessary
to permit the lawful use and operation of all driveways, roads and other means
of egress and ingress to and from any of the Tucker Properties (a "REA
Agreement") has not been obtained and is not in full force and effect, and there
is no pending threat of modification or cancellation of any of same nor is
Tucker nor any Tucker Subsidiary currently in default under any REA Agreement
and the Tucker Properties are in full compliance with all governmental permits,
licenses and certificates; (ii) no written notice of any violation of any
federal, state or municipal law, ordinance, order, regulation or requirement
affecting any portion of any of the Tucker Properties has been issued by any
governmental authority; (iii) there are no material structural defects relating
to any of the Tucker Properties; (iv) there is no Tucker Property whose building
systems are not in working order in any material respect; (v) there is no
physical damage to any Tucker Property in excess of $10,000 for which there is
no insurance in effect covering the full cost of the restoration; or (vi) there
is no current renovation or restoration or tenant improvements to any Tucker
Property or any portion thereof, the cost of which exceeds $10,000, except in
each instance as set forth in Section 5.12 of the Tucker Disclosure Letter.
Except as noted in Section 5.12 of the Tucker Disclosure Letter, the use and
occupancy of each of the Tucker Properties complies in all material respects
with all applicable codes and zoning laws and regulations, and Tucker has no
knowledge of any pending or threatened proceeding or action that will in any
manner affect the size of, use of, improvements on, construction on, or access
to any of the Tucker Properties, with such exceptions as are not material and do
not interfere with the use made and proposed to be made of such Tucker
Properties. Neither Tucker nor any of the Tucker Subsidiaries has received any
notice to the effect that (A) any betterment assessments have been levied
against, or any condemnation or rezoning proceedings are pending or threatened
with respect to any of the Tucker Properties or (B) any zoning, building or
similar law, code, ordinance, order or regulation is or will be violated by the
continued maintenance, operation or use of any buildings or other
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<PAGE>
improvements on any of the Tucker Properties or by the continued maintenance,
operation or use of the parking areas.
5.13 Leases.
------
(a) Section 5.13 of the Tucker Disclosure Letter sets forth a
true, accurate and complete rent roll for each of the Tucker Properties (the
"Rent Roll") as of September 30, 1995. The Rent Roll includes, without
limitation, the name of the Tenant, the space leased, the lease expiration date,
security and other deposits, prepaid rent (for more than 30 days), percentage
rent, pro rata share of operating expenses, taxes, charges and assessments.
Section 5.13 of the Tucker Disclosure Letter contains a list of known defaults
and a list of any extraordinary clauses including, without limitation, any
"kick-out" clauses, cotenancy requirements or exclusions, "go-dark" clauses, or
clauses requiring any future funding of tenant improvements.
(b) Except as noted in Section 5.13 of the Tucker Disclosure
Letter, as of the last day of the calendar month immediately preceding the date
hereof, (i) each of the leases and tenancies for all or any portion of the
Tucker Properties (the "Tucker Leases") is valid and subsisting and in full
force and effect, has not been amended, modified or supplemented; (ii) the
tenant under each of the Tucker Leases is in actual possession of the leased
premises; (iii) no tenants are in arrears for the payment of rent for any month
preceding the month of the date of this Agreement or otherwise in default of
such tenant's lease obligations as to which Tucker has given notice of default
to such tenant; and (iv) neither Tucker nor any Tucker Subsidiary has received
any written notice from any tenant of any intention to vacate. Except as set
forth in Section 5.13 of the Tucker Disclosure Letter, neither Tucker nor any
Tucker Subsidiary has collected payment of rent (other than security deposits)
accruing for a period which is more than one month beyond the date of
collection.
(c) Tucker has previously delivered or made available to Bradley a
true and correct copy of all Tucker Leases.
(d) Except as shown in Section 5.13 of the Tucker Disclosure
Letter, as of the last day of the calendar month immediately preceding the date
hereof, no tenant under any of the Tucker Leases has asserted any claim of which
Tucker or any Tucker Subsidiary has received written notice which would
materially affect the collection of rent from such tenant and neither Tucker nor
any Tucker Subsidiary has received written notice of any material default or
breach on the part of Tucker or any Tucker Subsidiary under any of the Tucker
Leases which has not been cured.
(e) Section 5.13 of the Tucker Disclosure Letter sets forth a
complete and correct list, as of the date hereof, of all written or oral
commitments made by Tucker or any Tucker Subsidiary to lease any of the Tucker
Properties or any portion thereof which has not yet been reduced to a written
lease. Tucker has provided true and correct copies of all such written
commitments to Bradley and Section 5.13 of the Tucker Disclosure Letter provides
with respect to each such oral commitment the principal terms of such
commitment, including, if applicable, (i) the space to be occupied, (ii) the
name of the tenant, (iii) the length of the
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<PAGE>
original term thereof and any right or option to renew or extend the lease term,
(iv) the monthly minimum rental, (v) rental escalations, (vi) the terms with
respect to percentage rent or other overage rent, (vii) any provisions for
tenant allowances and tenant build-out and (viii) the right of any third-party
broker to any outstanding brokerage or other commission incidental thereto and
all other financial terms.
(f) Except as set forth in Section 5.13 of the Tucker Disclosure
Letter all material leases pursuant to which Tucker or any Tucker Subsidiary, as
lessee, leases real or personal property are in good standing, valid and
effective in accordance with their respective terms, and there is not, under any
of such leases, any material existing default or any event which with notice or
lapse of time or both would constitute such a default, nor do any of such leases
contain any provision which would preclude the Surviving Corporation from
occupying and using the leased premises for the same purposes and upon
substantially the same rental and other terms as are applicable to the
occupation and use by Tucker and the Tucker Subsidiaries.
5.14 Rents. The rents and other income and charges set forth in Section
-----
5.13 of the Tucker Disclosure Letter are the actual rents, income and charges
presently being charged by Tucker and the Tucker Subsidiaries under the Tucker
Leases. No space is occupied rent free or at a rental rate reduced from the rate
stated in Section 5.13 of the Tucker Disclosure Letter. Other than set forth in
Section 5.13 of the Tucker Disclosure Letter, no tenant under any of the Tucker
Leases is entitled to any purchase option, concessions, allowances, abatements,
set-offs, rebates or refunds or has prepaid any rents or other charges for more
than one month. None of the Tucker Leases and none of the rents or other amounts
payable thereunder have been assigned, pledged or encumbered, other than to
lenders, as described in Section 5.22 of the Tucker Disclosure Letter. Except as
set forth in Section 5.22 of the Tucker Disclosure Letter, no brokerage or
leasing commission or other compensation will be due or payable to any person,
firm, corporation or other entity with respect to or on account of any of the
Tucker Leases or any extensions or renewals thereof on and after the Effective
Time.
5.15 Environmental Matters. Except as set forth in Section 5.15 of the
---------------------
Tucker Disclosure Letter, none of Tucker, any Tucker Subsidiary or, to the best
knowledge of Tucker, any other person has caused or permitted (a) the unlawful
presence of any hazardous substances, hazardous materials, toxic substances or
waste materials (collectively, "Hazardous Materials") on any of the Tucker
Properties, or (b) any unlawful spills, releases, discharges or disposal of
Hazardous Materials to have occurred or be presently occurring on or from any of
the Tucker Properties as a result of any construction on or operation and use of
such properties, which presence or occurrence would, individually or in the
aggregate, have a Tucker Material Adverse Effect; and in connection with the
construction on or operation and use of the Tucker Properties, neither Tucker
nor any of the Tucker Subsidiaries has failed to comply, in any material
respect, with any applicable local, state or federal environmental law,
regulation, ordinance or administrative and judicial order relating to the
generation, recycling, reuse, sale, storage, handling, transport and disposal of
any Hazardous Materials.
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<PAGE>
5.16 Employee Benefit Plans.
----------------------
(a) All employee benefits plans (within the meaning of Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")) and other benefit arrangements covering employees of Tucker and the
Tucker Subsidiaries, other than any multiemployer plan (within the meaning of
Section 3(37) of ERISA) (the "Tucker Benefit Plans") are listed in Section
5.16(a) of the Tucker Disclosure Letter. True and complete copies of the Tucker
Benefit Plans have been provided or made available to Bradley. To the extent
applicable, the Tucker Benefit Plans have been administered in all material
respects in accordance with their terms and comply, in all material respects,
with the applicable requirements of ERISA and the Code. Any Tucker Benefit Plan
intended to be qualified under Section 401(a) of the Code has received a
favorable determination letter from the IRS or a determination letter request
has been filed with the IRS with respect to any such plan and is still pending.
No Tucker Benefit Plan is covered by Title IV of ERISA or Section 412 of the
Code. No Tucker Benefit Plan nor Tucker or any Tucker Subsidiary has incurred
any liability or penalty under Section 4975 of the Code or Section 502(i) of
ERISA. There are no pending or anticipated claims against or otherwise involving
any of the Tucker Benefit Plans and no suit, action or other litigation
(excluding claims for benefits incurred in the ordinary course of Tucker Benefit
Plan activities) has been brought against or with respect to any such Tucker
Benefit Plan. All material contributions required to be made as of the date
hereof to the Tucker Benefit Plans have been made or provided for. Except as
otherwise required by Sections 601 through 608 of ERISA, Section 4980B of the
Code and applicable state laws or as set forth in the Severance Plan or the
Severance Agreements, Tucker does not maintain or contribute to any plan or
arrangement which provides or has any liability to provide life insurance,
medical or other employee welfare benefits to any employee or former employee
upon his retirement or termination of employment and Tucker has never
represented, promised or contracted (whether in oral or written form) to any
employee or former employee that such benefits would be provided. Except as set
forth in the Severance Plan or the Severance Agreements, as disclosed in the
Tucker Reports or in Section 5.16(a) of the Tucker Disclosure Letter, the
execution of, and performance of the transactions contemplated in, this
Agreement will not (either alone or upon the occurrence of any additional
subsequent events directly related to the transaction contemplated herein) (i)
constitute an event under any Tucker Benefit Plan that will or may result in any
payment (whether of severance pay or otherwise), acceleration, forgiveness of
indebtedness, vesting, distribution, increase in benefits or obligations to fund
benefits with respect to any employee, director or consultant of Tucker or any
Tucker Subsidiary pursuant to any Tucker Benefit Plan or (ii) result in the
triggering or imposition of any restrictions or limitations on the right of
Tucker or Bradley to amend or terminate any Tucker Benefit Plan. No payment or
benefit which will be required to be made pursuant to the terms of any
agreement, commitment or Tucker Benefit Plan (including the Severance Plan and
the Severance Agreements and the Consulting Agreement with Ken Tucker), as a
result of the transactions contemplated by this Agreement, to any officer,
director or employee of Tucker or any of the Tucker Subsidiaries, could be
characterized as an "excess parachute payment" within the meaning of Section
280G of the Code.
(b) Except as listed in Schedule 5.16(b) of the Tucker Disclosure
Letter, neither Tucker nor any Tucker Subsidiary contributes to or has any
liability to contribute to a
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multiemployer plan. All contributions have been made as required by the terms of
each of the plans listed in Schedule 5.16(b) of the Tucker Disclosure Letter and
the terms of any related collective bargaining agreements and neither Tucker nor
any Tucker Subsidiary has any knowledge or received any notice that any such
plan is in reorganization, that increased contributions are required to avoid a
reduction in plan benefits or the imposition of any excise tax, that any such
plan is or has been funded at a rate less than required under section 412 of the
Code, or that any such plan is insolvent.
5.17 Labor Matters. Except as set forth in Section 5.17 of the Tucker
-------------
Disclosure Letter, neither Tucker nor any Tucker Subsidiary is a party to, or
bound by, any collective bargaining agreement, contract or other agreement or
understanding with a labor union or labor union organization. There is no unfair
labor practice or labor arbitration proceeding pending or, to the knowledge of
Tucker, threatened against Tucker or any of the Tucker Subsidiaries relating to
their business, except for any such proceeding which would not have a Tucker
Material Adverse Effect. To the knowledge of Tucker, there are no organizational
efforts with respect to the formation of a collective bargaining unit presently
being made or threatened involving employees of Tucker or any of the Tucker
Subsidiaries.
5.18 No Brokers. Neither Tucker nor any of the Tucker Subsidiaries has
----------
entered into any contract, arrangement or understanding with any person or firm
which may result in the obligation of such entity or Bradley to pay any finder's
fees, brokerage or agent's commissions or other like payments in connection with
the negotiations leading to this Agreement or the consummation of the
transactions contemplated hereby, except that Tucker has retained PaineWebber
Incorporated ("PaineWebber") and those entities listed in Section 5.18 of the
Tucker Disclosure Letter, as its financial advisors, the arrangements with which
have been disclosed in writing to Bradley prior to the date hereof. Other than
the foregoing arrangements and Bradley's arrangement with Alex. Brown & Sons
Incorporated ("Alex. Brown"), Tucker is not aware of any claim for payment of
any finder's fees, brokerage or agent's commissions or other like payments in
connection with the negotiations leading to this Agreement or the consummation
of the transactions contemplated hereby.
5.19 Opinion of Financial Advisor. Tucker has received the opinion of
----------------------------
PaineWebber, to the effect that, as of the date hereof, the Exchange Ratio is
fair to the holders of Tucker Common Stock from a financial point of view, and
has delivered a true and correct copy of such opinion to Bradley.
5.20 Bradley Share Ownership. Neither Tucker nor any of the Tucker
-----------------------
Subsidiaries owns any shares of Bradley Common Stock or other securities
convertible into any shares of Bradley Common Stock.
5.21 Related Party Transactions. Set forth in Section 5.21 of the Tucker
--------------------------
Disclosure Letter is a list of all arrangements, agreements and contracts
(except for the Severance Plan and the Severance Agreements) entered into by
Tucker or any of the Tucker Subsidiaries (which are or will be in effect as of
or after the date of this Agreement) with (i) any consultant (X) involving
payments in excess of $25,000 or (Y) which may not be terminated at will by
Tucker or the Tucker Subsidiary which is a party thereto, (ii) any person who is
an officer,
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director or affiliate of Tucker or any of the Tucker Subsidiaries, any relative
of any of the foregoing or any entity of which any of the foregoing is an
affiliate or (iii) any person who acquired Tucker Common Stock in a private
placement. All such documents are listed in Section 5.21 of the Tucker
Disclosure Letter and the copies of such documents, which have previously been
provided or made available to Bradley and its counsel, are true and correct
copies. All of the management, leasing or other contracts to which TMC, TMLP or
any affiliate of Tucker is a party, receives income from or has obligations or
liabilities arising out of are listed on Schedule 5.21 of the Tucker Disclosure
Letter.
5.22 Contracts and Commitments. Section 5.22 of the Tucker Disclosure
-------------------------
Letter sets forth (i) all notes, debentures, bonds and other evidence of
indebtedness which are secured or collateralized by mortgages, deeds of trust or
other security interests in the Tucker Properties or personal property of Tucker
and each of the Tucker Subsidiaries and (ii) each Commitment entered into by
Tucker or any of the Tucker Subsidiaries which may result in total payments by
or liability of Tucker or any Tucker Subsidiary in excess of $10,000 except for
the Severance Plan and the Severance Agreements. Copies of the foregoing are
listed in Section 5.22 of the Tucker Disclosure Letter and the copies of such
documents, which have previously been provided or made available to Bradley and
its counsel, are true and correct. None of Tucker or any of the Tucker
Subsidiaries has received any notice of a default that has not been cured under
any of the documents described in clause (i) above or is in default respecting
any payment obligations thereunder beyond any applicable grace periods except
where such default would not have a Tucker Material Adverse Effect. All joint
venture agreements to which Tucker or any of the Tucker Subsidiaries is a party
are set forth in Section 5.22 of the Tucker Disclosure Letter and neither Tucker
nor any of the Tucker Subsidiaries is in default with respect to any
obligations, which individually or in the aggregate are material, thereunder.
5.23 Development Rights. Set forth in Section 5.23 of the Tucker
------------------
Disclosure Letter is a list of all agreements entered into by Tucker or any of
the Tucker Subsidiaries relating to the development or construction of the
Tucker Properties and a description of the current status of each such
development. The copies of such agreements are listed in Section 5.23 of the
Tucker Disclosure Letter, and such copies, which have previously been provided
to Bradley and its counsel, are true and correct. All work to be performed,
payments to be made and actions to be taken by Tucker or any of the Tucker
Subsidiaries prior to the date hereof pursuant to any agreement entered into
with a governmental body or authority in connection with the development of the
Tucker Properties, including any Development Agreement relating to a site
approval, zoning reclassification or other similar action (e.g., Local
Improvement District, Road Improvement District, Environmental Mitigation, etc.)
has been performed, paid or taken, as the case may be, and Tucker is not aware
of any planned or proposed work, payments or actions that may be required after
the date hereof pursuant to such agreements.
5.24 Certain Payments Resulting From Transactions. Except for the
--------------------------------------------
Severance Plan and the Severance Agreements and the vesting of options as set
forth in Section 5.3 of the Tucker Disclosure Letter, the execution of, and
performance of the transactions contemplated by, this Agreement will not (either
alone or upon the occurrence of any additional or subsequent events) (i)
constitute an event under any Tucker Benefit Plan, policy, practice,
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agreement or other arrangement or any trust or loan (the "Employee
Arrangements") that will or may result in any payment (whether of severance pay
or otherwise), acceleration, forgiveness of indebtedness, vesting, distribution,
increase in benefits or obligation to fund benefits with respect to any
employee, director or consultant of Tucker or any of the Tucker Subsidiaries, or
(ii) result in the triggering or imposition of any restrictions or limitations
on the right of Tucker or Bradley to amend or terminate any Employee Arrangement
and receive the full amount of any excess assets remaining or resulting from
such amendment or termination, subject to applicable taxes. No payment or
benefit which will be required to be made pursuant to the terms of any
agreement, commitment or Tucker Benefit Plan (including the Severance Plan and
the Severance Agreements), as a result of the transactions contemplated by this
Agreement, to any officer, director or employee of Tucker or any of the Tucker
Subsidiaries, could be characterized as an "excess parachute payment" within the
meaning of Section 280G of the Code.
5.25 Indemnification Claims. No indemnification or other claims have
----------------------
been made by Tucker, any Tucker Subsidiary, or any other person against the TTC
Principals or the TTC Guarantors (as such terms are defined in the TOP
Partnership Agreement) under Section 14 or any other section or provision of the
TOP Partnership Agreement or any other agreement to which Tucker or any Tucker
Subsidiary is a party and, to the best knowledge of Tucker, no facts or
circumstances exist which could give rise to any such claim.
5.26 Disclosure. The representations, warranties and statements made by
----------
Tucker in this Agreement, the Ancillary Agreements and in the Tucker Disclosure
Letter and in the certificates and other documents delivered pursuant hereto do
not contain any untrue statement of a material fact, and, when taken together,
do not omit to state any material fact necessary to make such representations,
warranties and statements, in light of the circumstances under which they are
made, not misleading.
5.27 Status of Holden Court and Holden Court Escrow. Section 5.27 of the
----------------------------------------------
Tucker Disclosure Letter sets forth a description of the current status of the
Holden Court Escrow Agreement established in connection with the contribution of
One North State to TOP and a description of the status of efforts with the City
of Chicago to secure fee simple title to Holden Court as required by the Holden
Court Escrow Agreement.
5.28 Tenant Improvements. Section 5.28 of the Tucker Disclosure Letter
-------------------
contains (i) a list of any unfunded tenant improvements being conducted by
Tucker or any Tucker Subsidiary in excess of $10,000 and (ii) to the best
knowledge of Tucker, the aggregate amount of all unfunded tenant improvements
for all Tucker Properties. Tucker and each Tucker Subsidiary has delivered or
made available true and correct copies of any and all contracts, plans,
specifications and agreements in connection with all tenant improvements in
excess of $10,000.
5.29 Status of Options to Purchase Real Property. All options of Tucker
-------------------------------------------
or any of the Tucker Subsidiaries to purchase real property, including a
description of the current status, conditions and contingencies relating to each
of such options, are set forth in Section 5.29 of the Tucker Disclosure Letter.
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5.30 Definition of Tucker's Knowledge. As used in this Agreement, the
--------------------------------
phrase "to the knowledge of Tucker" or "to the best knowledge of Tucker" (or
words of similar import) means the knowledge or the best knowledge of those
individuals identified in Section 5.30 of the Tucker Disclosure Letter, and
includes any fact, matter or circumstance which any of such individuals, as an
ordinary and prudent business person employed in the same capacity in the same
type and size of business as Tucker, should have known.
ARTICLE 6
6. Representations and Warranties of Bradley.
-----------------------------------------
Except as set forth in the disclosure letter delivered at or prior to the
execution hereof to Tucker, which shall refer to the relevant Sections of this
Agreement (the "Bradley Disclosure Letter"), Bradley represents and warrants to
Tucker as follows:
6.1 Existence; Good Standing; Authority; Compliance With Law. Bradley
--------------------------------------------------------
is a corporation duly incorporated, validly existing and in good standing under
the laws of the State of Maryland. Bradley is duly licensed or qualified to do
business as a foreign corporation and is in good standing under the laws of any
other state of the United States in which the character of the properties owned
or leased by it therein or in which the transaction of its business makes such
qualification necessary, except where the failure to be so licensed or qualified
would not have a material adverse effect on the business, results of operations
or financial condition of Bradley and the Bradley Subsidiaries (as defined
below) taken as a whole (a "Bradley Material Adverse Effect"). Bradley has all
requisite corporate power and authority to own, operate, lease and encumber its
properties and carry on its business as now conducted. Each of the Bradley
Subsidiaries is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation or organization,
has the corporate power and authority to own its properties and to carry on its
business as it is now being conducted, and is duly qualified to do business and
is in good standing in each jurisdiction in which the ownership of its property
or the conduct of its business requires such qualification, except for
jurisdictions in which such failure to be so qualified or to be in good standing
would not have a Bradley Material Adverse Effect. Neither Bradley nor any
Bradley Subsidiary is in violation of any order of any court, governmental
authority or arbitration board or tribunal, or any law, ordinance, governmental
rule or regulation to which Bradley or any Bradley Subsidiary or any of their
respective properties or assets is subject, where such violation would have a
Bradley Material Adverse Effect. Bradley and the Bradley Subsidiaries have
obtained all licenses, permits and other authorizations and have taken all
actions required by applicable law or governmental regulations in connection
with their business as now conducted, where the failure to obtain any such
license, permit or authorization or to take any such action would have a Bradley
Material Adverse Effect. Copies of the Charter and other equivalent documents
and Bylaws (and all amendments thereto) of Bradley and each of the Bradley
Subsidiaries are listed in Section 6.1 of the Bradley Disclosure Letter, and the
copies of such documents, which have previously been delivered or made available
to Tucker or its counsel, are true and correct copies. For
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purposes of this Agreement, the term "Bradley Subsidiary" shall include any of
the entities set forth under such heading in Section 6.4 of the Bradley
Disclosure Letter.
6.2 Authorization, Validity and Effect of Agreements. Bradley has the
------------------------------------------------
requisite corporate power and authority to enter into the transactions
contemplated hereby and to execute and deliver this Agreement and the Ancillary
Agreements to which it is a party. The Board of Directors of Bradley has, by
resolutions duly adopted by unanimous vote approved this Agreement, the Merger
and the other transactions contemplated by this Agreement and has agreed to
recommend that the holders of Bradley Common Stock adopt and approve this
Agreement, the Merger and the transactions contemplated by this Agreement at the
Bradley stockholders' meeting which will be held in accordance with the
provisions of Section 7.3. In connection with the foregoing, the Board of
Directors of Bradley has taken such actions and votes as are necessary on its
part to render the provisions of the Control Share Acquisition Statute, the
Business Combination Statute and all other applicable takeover statutes of the
MGCL and any other applicable takeover statutes of any other state, inapplicable
to this Agreement, the Merger, and the transactions contemplated by this
Agreement. As of the date hereof, all of the directors and executive officers of
Bradley have indicated that they presently intend to vote all shares of Bradley
Common Stock which they own to approve this Agreement, the Merger, and the
transactions contemplated by this Agreement at the Bradley stockholders meeting
which will be held in accordance with the provisions of Section 7.3. Subject
only to the approval of this Agreement and the transactions contemplated hereby
by the holders of a majority of the outstanding shares of Bradley Common Stock,
the execution by Bradley of this Agreement, the Ancillary Agreements and the
consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements has been duly authorized by all requisite corporate action
on the part of Bradley. This Agreement constitutes, and the Ancillary Agreements
to which it will become a party (when executed and delivered pursuant hereto)
will constitute, the valid and legally binding obligations of Bradley,
enforceable against Bradley in accordance with their respective terms, subject
to applicable bankruptcy, insolvency, moratorium or other similar laws relating
to creditors' rights and general principles of equity.
6.3 Capitalization. The authorized capital stock of Bradley consists of
--------------
80,000,000 shares of Bradley Common Stock, 20,000,000 shares of preferred stock,
par value $.01 per share (the "Bradley Preferred Stock"), and 50,000,000 shares
of excess stock, par value $.01 per share ("Bradley Excess Stock"). As of the
date hereof, there are 11,226,606 shares of Bradley Common Stock issued and
outstanding, and no shares of Bradley Preferred Stock or Bradley Excess Stock
are issued and outstanding. All such issued and outstanding shares of Bradley
Common Stock are duly authorized, validly issued, fully paid, nonassessable and
free of preemptive rights. Bradley has no outstanding bonds, debentures, notes
or other obligations the holders of which have the right to vote (or which are
convertible into or exercisable for securities having the right to vote) with
the stockholders of Bradley on any matter. There are not at the date of this
Agreement any existing options, warrants, calls, subscriptions, convertible
securities, or other rights, agreements or commitments which obligate Bradley to
issue, transfer or sell any shares of Bradley Common Stock, other than the
issuance by Bradley of up to 297,875 shares of Bradley Common Stock upon the
exercise of stock options issued pursuant to Bradley's stock option plans. There
are no agreements or understandings to
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<PAGE>
which Bradley or any Bradley Subsidiary is a party with respect to the voting of
any shares of Bradley Common Stock or which restrict the transfer of any such
shares, nor does Bradley have knowledge of any such agreements or understandings
with respect to the voting of any such shares or which restrict the transfer of
such shares.
6.4 Subsidiaries. Bradley owns all of the outstanding shares of capital
------------
stock of each of the Bradley Subsidiaries. All of the outstanding shares of
capital stock of each of the Bradley Subsidiaries are duly authorized, validly
issued, fully paid and nonassessable, and are owned, by Bradley free and clear
of all liens, pledges, security interests, claims or other encumbrances. The
following information for each Bradley Subsidiary is set forth in Section 6.4 of
the Bradley Disclosure Letter: (i) its name and jurisdiction of incorporation or
organization and (ii) its authorized capital stock.
6.5 Other Interests. Except for interests in the Bradley Subsidiaries
---------------
and the securities of other publicly traded REITs, neither Bradley nor any
Bradley Subsidiary owns directly or indirectly any interest or investment
(whether equity or debt) in any corporation, partnership, joint venture, trust
or other entity (other than investments in short-term investment securities).
6.6 No Violation. Except as set forth in Section 6.6 of the Bradley
------------
Disclosure Letter, neither the execution and delivery by Bradley of this
Agreement or the Ancillary Agreements nor the consummation by Bradley of the
transactions contemplated by this Agreement and the Ancillary Agreements in
accordance with their terms, will: (i) conflict with or result in a breach of
any provisions of the Articles of Incorporation or Bylaws of Bradley; (ii)
result in a breach or violation of, a default under, or the triggering of any
payment or other material obligations pursuant to, or accelerate vesting under,
any of Bradley's stock option plans, or any grant or award under any of the
foregoing; (iii) violate, or conflict with, or result in a breach of any
provision of, or constitute a default (or an event which, with notice or lapse
of time or both, would constitute a default) under, or result in the termination
or in a right of termination or cancellation of, or accelerate the performance
required by, or result in the creation of any lien, security interest, charge or
encumbrance upon any of the properties of Bradley or any of the Bradley
Subsidiaries under, or result in being declared void, voidable, or without
further binding effect, any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, deed of trust or any license, franchise, permit,
lease, contract, agreement or other instrument, commitment or obligation to
which Bradley or any of the Bradley Subsidiaries is a party, or by which Bradley
or any of the Bradley Subsidiaries or any of their properties is bound or
affected, except for any of the foregoing matters which, individually or in the
aggregate, would not have a Bradley Material Adverse Effect; or (iv) other than
the Regulatory Filings, require any consent, approval or authorization of, or
declaration, filing or registration with, any governmental or regulatory
authority except where the failure to obtain any such consent, approval or
authorization of, or declaration, filing or registration with, any governmental
or regulatory authority would not have a Bradley Material Adverse Effect.
6.7 SEC Documents. A complete list of Bradley SEC filings, including
-------------
the Form 10-K for the fiscal year ended December 31, 1993 filed by Bradley's
predecessor entity,
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<PAGE>
Bradley Real Estate Trust ("Bradley Trust"), and each (A) registration
statement, (B) annual report on Form 10-K, (C) quarterly report on Form 10-Q,
(D) current report on Form 8-K, (E) proxy statement or information statement,
and (F) any other report filed with the SEC pursuant to the Exchange Act, (in
all such cases, including all exhibits, amendments and supplements thereto)
prepared by Bradley or Bradley Trust or relating to their properties since
December 31, 1993, are set forth in Section 6.7 of the Bradley Disclosure
Letter, and copies of which, in the form (including exhibits and any amendments
thereto) filed with the SEC, have previously been provided or made available to
Tucker or its counsel (collectively, the "Bradley Reports"). The Bradley Reports
were filed with the SEC in a timely manner and constitute all forms, reports and
documents required to be filed by Bradley (including for this purpose the
Bradley Trust) under the Securities Laws subsequent to December 31, 1993. As of
their respective dates, the Bradley Reports (i) complied as to form in all
material respects with the applicable requirements of the Securities Laws and
(ii) did not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
made therein, in the light of the circumstances under which they were made, not
misleading. Each of the consolidated balance sheets of Bradley included in or
incorporated by reference into the Bradley Reports (including the related notes
and schedules) fairly presents the consolidated financial position of Bradley
and the Bradley Subsidiaries as of its date and each of the consolidated
statements of income, retained earnings and cash flows of Bradley included in or
incorporated by reference into the Bradley Reports (including any related notes
and schedules) fairly presents the results of operations, retained earnings or
cash flows, as the case may be, of Bradley and the Bradley Subsidiaries for the
periods set forth therein (subject, in the case of unaudited statements, to
normal year-end audit adjustments which would not be material in amount or
effect), in each case in accordance with generally accepted accounting
principles consistently applied during the periods involved, except as may be
noted therein and except, in the case of the unaudited statements, as permitted
by Form 10-Q of the SEC. Except as and to the extent set forth on the
consolidated balance sheet of Bradley and the Bradley Subsidiaries at December
31, 1994, including all notes thereto, or as set forth in the Bradley Reports,
neither Bradley nor any of the Bradley Subsidiaries has any material liabilities
or obligations of any nature (whether accrued, absolute, contingent or
otherwise) that would be required to be reflected on, or reserved against in, a
balance sheet of Bradley or in the notes thereto, prepared in accordance with
generally accepted accounting principles consistently applied, except
liabilities arising in the ordinary course of business since such date and
liabilities for expenses of attorneys, accountants and investment bankers
incurred in connection with the Merger.
6.8 Litigation. There are (i) no continuing orders, injunctions or
----------
decrees of any court, arbitrator or governmental authority to which Bradley or
any Bradley Subsidiary is a party or by which any of its properties or assets
are bound or, to the reasonable best knowledge of Bradley, to which any of its
directors, officers, employees or agents is a party or by which any of their
properties or assets are bound, and (ii) no actions, suits or proceedings
pending against Bradley or any Bradley Subsidiary or, to the reasonable best
knowledge of Bradley, against any of its directors, officers, employees or
agents or, to the reasonable best knowledge of Bradley, threatened against
Bradley or any Bradley Subsidiary or against any of its directors, officers,
employees or agents, at law or in equity, or before or by any federal or state
commission, board, bureau, agency or instrumentality, that, in the case of
clause (i) or
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<PAGE>
(ii), are reasonably likely, individually or in the aggregate, to
have a Bradley Material Adverse Effect.
6.9 Absence of Certain Changes. Except as disclosed in the Bradley
--------------------------
Reports filed with the SEC prior to the date hereof, since December 31, 1994,
Bradley and the Bradley Subsidiaries have conducted their business only in the
ordinary course of such business and there has not been (i) any Bradley Material
Adverse Effect; (ii) as of the date hereof, any declaration, setting aside or
payment of any dividend or other distribution with respect to the Bradley Common
Stock, except dividends of $0.33 per share paid on March 31, June 30, 1995 and
September 29, 1995; or (iii) any material change in Bradley's accounting
principles, practices or methods.
6.10 Taxes. Except as set forth in Section 6.10 of the Bradley
-----
Disclosure Letter:
(a) Bradley and each of the Bradley Subsidiaries has paid or
caused to be paid Taxes, owed by it through the date hereof.
(b) Bradley and each of the Bradley Subsidiaries has timely filed
all federal, state, local and foreign tax returns required to be filed by any of
them through the date hereof, and all such returns completely and accurately set
forth the amount of any Taxes relating to the applicable period.
(c) Neither the IRS nor any other governmental authority is now
asserting by written notice to Bradley or any Bradley Subsidiary or, to the
knowledge of Bradley or the Bradley Subsidiaries, threatening to assert against
Bradley any deficiency or claim for additional Taxes. There is no dispute or
claim concerning any Tax liability of Bradley, either claimed or raised by any
governmental authority, or as to which any officer of Bradley has reason to
believe may be claimed or raised by any governmental authority. No claim has
ever been made by a taxing authority in a jurisdiction where Bradley does not
file reports and returns that Bradley is or may be subject to taxation by that
jurisdiction. There are no security interests on any of the assets of Bradley or
any Bradley Subsidiary that arose in connection with any failure (or alleged
failure) to pay any Taxes. Bradley has never entered into a closing agreement
pursuant to Section 7121 of the Code.
(d) Bradley has not received written notice of any audit of any
tax return filed by Bradley, no such audit is in progress, and Bradley has not
been notified by any tax authority that any such audit is contemplated or
pending. Neither Bradley nor any of the Bradley Subsidiaries has executed or
filed with the IRS or any other taxing authority any agreement now in effect
extending the period for assessment or collection of any income or other taxes,
and no extension of time with respect to any date on which a tax return was or
is to be filed by Bradley is in force. True, correct and complete copies of all
federal, state and local income or franchise tax returns filed by Bradley and
each of the Bradley Subsidiaries and all communications relating thereto have
been delivered to Tucker or made available to representatives of Tucker.
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<PAGE>
(e) Bradley and each Bradley Subsidiary has withheld and paid all
taxes required to have been withheld and paid in connection with amounts paid or
owing to any employee, independent contractor, creditor, stockholder or other
party.
(f) Each of the Bradley Subsidiaries of which all the outstanding
capital stock is owned solely by Bradley is a Qualified REIT Subsidiary as
defined in Section 856(i) of the Code.
(g) For all applicable tax years as to which Bradley's federal
income tax returns are subject to audit and Bradley is subject to assessment for
taxes reportable therein, and at all times thereafter up to and including the
date hereof, Bradley has qualified to be treated as a REIT within the meaning of
Sections 856-860 of the Code, including, without limitation, the requirements of
Sections 856 and 857 of the Code. For the periods described in the preceding
sentence, Bradley has met all requirements necessary to be treated as a REIT for
purposes of the income tax provisions of each state in which Bradley is subject
to income tax and which provides for the taxation of REITs in a manner similar
to the treatment of REITs under Sections 856-860 of the Code, but, with respect
to each such state, only for such periods for which Bradley's income tax returns
are subject to audit and Bradley is subject to assessment for taxes reportable
therein.
6.11 Books and Records. The books of account and other financial records
-----------------
of Bradley and each of the Bradley Subsidiaries are true, complete and correct
in all material respects, have been maintained in accordance with good business
practices, and are accurately reflected in all material respects in the
financial statements included in the Bradley Reports. The minute books and other
records of Bradley and each of the Bradley Subsidiaries have been made available
to Tucker, contain in all material respects accurate records of all meetings and
accurately reflect in all material respects all other corporate action of the
shareholders and directors and any committees of the Board of Directors of
Bradley and each of the Bradley Subsidiaries.
6.12 Properties. All of the real estate properties owned by Bradley and
----------
each of the Bradley Subsidiaries are set forth in Section 6.12 of the Bradley
Disclosure Letter. Except as set forth in Section 6.12 of the Bradley Disclosure
Letter, Bradley owns fee simple title to each of the real properties identified
in the Bradley Disclosure Letter (the "Bradley Properties"), free and clear of
Encumbrances. The Bradley Properties are not subject to any Property
Restrictions, except for (i) Encumbrances and Property Restrictions set forth in
Section 6.12 of the Bradley Disclosure Letter, (ii) Property Restrictions
imposed or promulgated by law or any governmental body or authority with respect
to real property, including zoning regulations that do not adversely affect the
current use of the property, materially detract from the value or materially
interfere with the present use of the property, (iii) Encumbrances and Property
Restrictions disclosed on existing title reports or current surveys (in either
case copies of which title reports and surveys have been delivered or made
available to Tucker and are listed in Section 6.12 of the Bradley Disclosure
Letter), and (iv) mechanics', carriers', workmen's or repairmen's liens and
other Encumbrances, Property Restrictions and other limitations of any kind, if
any, which, individually or in the aggregate, are not material in amount, do not
materially detract from the value of or materially interfere
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<PAGE>
with the present use of any of the Bradley Properties subject thereto or
affected thereby, and do not otherwise materially impair business operations
conducted by Bradley and the Bradley Subsidiaries and which have arisen or been
incurred only in the ordinary course of business. Such Encumbrances and Property
Restrictions described in Section 6.12 of the Bradley Disclosure Letter are not
convertible into shares of capital stock of Bradley or any Bradley Subsidiary
nor does Bradley or any Bradley Subsidiary hold a participating interest
therein. Bradley is the named insured in the title insurance policies set forth
in Section 6.12 of the Bradley Disclosure Letter. Such policies are maintained
with respect to each of the Bradley Properties in an amount of (i) the cost of
acquisition of such property or (ii) the cost of construction by Bradley and the
Bradley Subsidiaries of the improvements located on such property (measured at
the time of such construction), except, in each case, (x) as listed in Section
6.12 of the Bradley Disclosure Letter or (y) where the failure to maintain such
title insurance would not have a Bradley Material Adverse Effect. Such policies
are, at the date hereof, in full force and effect and no claim has been made
against any such policy. To the best knowledge of Bradley, (i) no certificate,
permit or license from any governmental authority having jurisdiction over any
of the Bradley Properties or any agreement, easement or other right which is
necessary to permit the lawful use and operation of the buildings and
improvements on any of the Bradley Properties or which is necessary to permit
the lawful use and operation of all driveways, roads and other means of egress
and ingress to and from any of the Bradley Properties has not been obtained and
is not in full force and effect, and there is no pending threat of modification
or cancellation of any of same; (ii) no written notice of any violation of any
federal, state or municipal law, ordinance, order, regulation or requirement
affecting any portion of any of the Bradley Properties has been issued by any
governmental authority; (iii) there are no structural defects relating to any of
the Bradley Properties; (iv) there is no Bradley Property whose building systems
are not in working order in any material respect; (v) there is no physical
damage to any Bradley Property in excess of $10,000 for which there is no
insurance in effect covering the full cost of the restoration; or (vi) there is
no current renovation or restoration to any Bradley Property, the cost of which
exceeds $10,000. Except as noted in Section 6.12 of the Bradley Disclosure
Letter, Bradley and the Bradley Subsidiaries have valid and subsisting leases
for all leased Bradley Properties, the use and occupancy of each of the Bradley
Properties complies in all material respects with all applicable codes and
zoning laws and regulations, and Bradley has no knowledge of any pending or
threatened proceeding or action that will in any manner affect the size of, use
of, improvements on, construction on, or access to any of the Bradley
Properties, with such exceptions as are not material and do not interfere with
the use made and proposed to be made of such Bradley Properties. Neither Bradley
nor any of the Bradley Subsidiaries has received any notice to the effect that
(A) any condemnation or rezoning proceedings are pending or threatened with
respect to any of the Bradley Properties or (B) any zoning, building or similar
law, code, ordinance, order or regulation is or will be violated by the
continued maintenance, operation or use of any buildings or other improvements
on any of the Bradley Properties or by the continued maintenance, operation or
use of the parking areas.
6.13 Environmental Matters. None of Bradley, any Bradley Subsidiary or,
---------------------
to the best knowledge of Bradley, any other person has caused or permitted (a)
the unlawful presence of any Hazardous Materials on any of the Bradley
Properties, or (b) any unlawful spills, releases, discharges or disposal of
Hazardous Materials to have occurred or be presently
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<PAGE>
occurring on or from any of the Bradley Properties as a result of any
construction on or operation and use of such properties, which presence or
occurrence would, individually or in the aggregate, have a Bradley Material
Adverse Effect; and in connection with the construction on or operation and use
of the Bradley Properties, neither Bradley nor any of the Bradley Subsidiaries
has failed to comply, in any material respect, with any applicable local, state
or federal environmental law, regulation, ordinance or administrative and
judicial order relating to the generation, recycling, reuse, sale, storage,
handling, transport and disposal of any Hazardous Materials.
6.14 Employee Benefit Plans. All employee benefits plans (within the
----------------------
meaning of Section 3(3) of ERISA) and other benefit arrangements covering
employees of Bradley and the Bradley Subsidiaries (the "Bradley Benefit Plans")
are listed in Section 6.14 of the Bradley Disclosure Letter. True and complete
copies of the Bradley Benefit Plans have been provided or made available to
Tucker. To the extent applicable, the Bradley Benefit Plans have been
administered in all material respects in accordance with their terms and comply,
in all material respects, with the applicable requirements of ERISA and the
Code. Any Bradley Benefit Plan intended to be qualified under Section 401(a) of
the Code has received a favorable determination letter from the IRS or a
determination letter request has been filed with the IRS with respect to any
such plan and is still pending. No Bradley Benefit Plan is covered by Title IV
of ERISA or Section 412 of the Code. No Bradley Benefit Plan nor Bradley or any
of the Bradley Subsidiaries has incurred any liability or penalty under Section
4975 of the Code or Section 502(i) of ERISA. There are no pending or anticipated
claims against or otherwise involving any of the Bradley Benefit Plans and no
suit, action or other litigation (excluding claims for benefits incurred in the
ordinary course of Bradley Benefit Plan activities) has been brought against or
with respect to any such Bradley Benefit Plan. All material contributions
required to be made as of the date hereof to the Bradley Benefit Plans have been
made or provided for. Neither Bradley nor any entity under "common control" with
Bradley within the meaning of ERISA Section 4001 has contributed to, or been
required to contribute to, any "multiemployer plan" (as defined in Sections
3(37) and 4001(a)(3) of ERISA). Except as otherwise required by Sections 601
through 608 of ERISA, Section 4980B of the Code and applicable state laws,
Bradley does not maintain or contribute to any plan or arrangement which
provides or has any liability to provide life insurance, medical or other
employee welfare benefits to any employee or former employee upon his retirement
or termination of employment and Bradley has never represented, promised or
contracted (whether in oral or written form) to any employee or former employee
that such benefits would be provided. Except as disclosed in the Bradley
Reports, the execution of, and performance of the transactions contemplated in,
this Agreement will not (either alone or upon the occurrence of any additional
subsequent events directly related to the transaction contemplated herein)
constitute an event under any Bradley Benefit Plan that will or may result in
any payment (whether of severance pay or otherwise), acceleration, forgiveness
of indebtedness, vesting, distribution, increase in benefits or obligations to
fund benefits with respect to any employee, director or consultant of Bradley or
any Bradley Subsidiary.
6.15 Labor Matters. Neither Bradley nor any Bradley Subsidiary is a
-------------
party to, or bound by, any collective bargaining agreement, contract or other
agreement or understanding with a labor union or labor union organization. There
is no unfair labor practice or labor
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arbitration proceeding pending or, to the knowledge of Bradley, threatened
against Bradley or any of the Bradley Subsidiaries relating to their business,
except for any such proceeding which would not have a Bradley Material Adverse
Effect. To the knowledge of Bradley, there are no organizational efforts with
respect to the formation of a collective bargaining unit presently being made or
threatened involving employees of Bradley or any of the Bradley Subsidiaries.
6.16 No Brokers. Neither Bradley nor any of the Bradley Subsidiaries has
----------
entered into any contract, arrangement or understanding with any person or firm
which may result in the obligation of such entity or Tucker to pay any finder's
fees, brokerage or agent's commissions or other like payments in connection with
the negotiations leading to this Agreement or the consummation of the
transactions contemplated hereby, except that Bradley has retained Alex. Brown
as its financial advisor, the arrangements with which have been disclosed in
writing to Tucker prior to the date hereof. Other than the foregoing
arrangements and Tucker's arrangements set forth in Section 5.18 of this
Agreement and Section 5.18 of the Tucker Disclosure Letter, Bradley is not aware
of any claim for payment of any finder's fees, brokerage or agent's commissions
or other like payments in connection with the negotiations leading to this
Agreement or the consummation of the transactions contemplated hereby.
6.17 Opinion of Financial Advisor. Bradley has received the opinion of
----------------------------
Alex. Brown to the effect that, as of the date hereof, the Exchange Ratio is
fair to the holders of Bradley Common Stock from a financial point of view, and
has delivered a true and correct copy of such opinion to Tucker.
6.18 Tucker Stock Ownership. Neither Bradley nor any of the Bradley
----------------------
Subsidiaries owns any shares of capital stock of Tucker or other securities
convertible into capital stock of Tucker.
6.19 Related Party Transactions. Set forth in Section 6.19 of the
--------------------------
Bradley Disclosure Letter is a list of all arrangements, agreements and
contracts entered into by Bradley or any of the Bradley Subsidiaries (which are
or will be in effect as of or after the date of this Agreement) with (i) any
consultant in excess of $25,000 or which may not be terminated at will by
Bradley, (ii) any person who is an officer, director or affiliate of Bradley or
any of the Bradley Subsidiaries, any relative of any of the foregoing or any
entity of which any of the foregoing is an affiliate or (iii) any person who
acquired Bradley Common Stock in a private placement. All such documents are
listed in Section 6.19 of the Bradley Disclosure Letter and the copies of such
documents, which have previously been provided or made available to Tucker and
its counsel, are true and correct.
6.20 Contracts and Commitments. Section 6.20 of the Bradley Disclosure
-------------------------
Letter sets forth (i) all notes, debentures, bonds and other evidence of
indebtedness which are secured or collateralized by mortgages, deeds of trust or
other security interests in the Bradley Properties or personal property of
Bradley and each of the Bradley Subsidiaries and (ii) each Commitment entered
into by Bradley or any of the Bradley Subsidiaries which may result in total
payments or liability in excess of $10,000. Copies of the foregoing are listed
in Section 6.20 of the Bradley Disclosure Letter and the copies of such
documents, which have
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<PAGE>
previously been provided or made available to Tucker and its counsel, are true
and correct copies. None of Bradley or any of the Bradley Subsidiaries has
received any notice of a default that has not been cured under any of the
documents described in clause (i) above or is in default respecting any payment
obligations thereunder beyond any applicable grace periods, except where such
default would not have a Bradley Material Adverse Effect. All options of Bradley
or any of the Bradley Subsidiaries to purchase real property are set forth in
Section 6.20 of the Bradley Disclosure Letter and such options and Bradley's or
any of the Bradley Subsidiaries' rights thereunder are in full force and effect.
All joint venture agreements to which Bradley or any of the Bradley Subsidiaries
is a party are set forth in Section 6.20 of the Bradley Disclosure Letter and
neither Bradley nor any of the Bradley Subsidiaries is in default with respect
to any obligations, which individually or in the aggregate are material,
thereunder.
6.21 Development Rights. Set forth in Section 6.21 of the Bradley
------------------
Disclosure Letter is a list of all agreements entered into by Bradley or any of
the Bradley Subsidiaries relating to the development or construction of real
estate properties. The copies of such agreements are listed in Section 6.21 of
the Bradley Disclosure Letter and the copies of such documents, which have
previously been provided or made available to Tucker and its counsel, are true
and correct.
6.22 Bradley Common Stock. The issuance and delivery by Bradley of
--------------------
shares of Bradley Common Stock in connection with the Merger and this Agreement
have been duly and validly authorized by all necessary corporate action on the
part of Bradley except for the approval of its stockholders contemplated by this
Agreement. The shares of Bradley Common Stock to be issued in connection with
the Merger and this Agreement, when issued in accordance with the terms of this
Agreement, will be validly issued, fully paid, nonassessable and free of
preemptive rights.
6.23 Convertible Securities. Bradley has no outstanding options,
----------------------
warrants or other securities exercisable for, or convertible into, shares of
Bradley Common Stock, the terms of which would require any anti-dilution
adjustments by reason of the consummation of the transactions contemplated
hereby.
6.24 Disclosure. The representations, warranties and statements made by
----------
Bradley in this Agreement, the Ancillary Agreements and in the Bradley
Disclosure Letter and in the certificates and other documents, delivered
pursuant hereto do not contain any untrue statement of a material fact, and,
when taken together, do not omit to state any material fact necessary to make
such representations, warranties and statements, in light of the circumstances
under which they are made, not misleading.
6.25 Definition of Bradley's Knowledge. As used in this Agreement, the
---------------------------------
phrase "to the knowledge of Bradley" or "to the best knowledge of Bradley" (or
words of similar import) means the knowledge or the best knowledge of those
individuals identified in Section 6.25 of the Bradley Disclosure Letter, and
includes any fact, matter or circumstance which any of such individuals, as an
ordinary and prudent business person employed in the same capacity in the same
type and size of business as Bradley, should have known.
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ARTICLE 7
7. Covenants.
---------
7.1 Acquisition Proposals. Unless and until this Agreement shall have
---------------------
been terminated in accordance with its terms, Tucker agrees and covenants (a)
that neither it nor any Tucker Subsidiary shall, and each of them shall direct
and use its best efforts to cause its respective officers, directors, employees,
agents and representatives (including, without limitation, any investment
banker, attorney or accountant retained by it or any of the Tucker Subsidiaries)
not to, directly or indirectly, initiate, solicit or encourage any inquiries or
the making or implementation of any proposal or offer (including, without
limitation, any proposal or offer to its stockholders) with respect to a merger,
acquisition, tender offer, exchange offer, consolidation or similar transaction
involving, or any purchase of 10% or more of the assets or any equity securities
or partnership interests (including, without limitation, TOP Units) of, Tucker
or any Tucker Subsidiary, other than the transactions contemplated by this
Agreement (any such proposal or offer being hereinafter referred to as an
"Acquisition Proposal") or engage in any negotiations concerning, or provide any
confidential information or data to, or have any discussions with, any person
relating to an Acquisition Proposal, or otherwise facilitate any effort or
attempt to make or implement an Acquisition Proposal; (b) that Tucker will
immediately cease and cause to be terminated any existing activities,
discussions or negotiations with any parties conducted heretofore with respect
to any of the foregoing and will take the necessary steps to inform the
individuals or entities referred to above of the obligations undertaken in this
Section 7.1; and (c) that Tucker will notify Bradley immediately if any such
inquiries or proposals are received by, any such information is requested from,
or any such negotiations or discussions are sought to be initiated or continued
with, it; provided, however, that nothing contained in this Section 7.1 shall
prohibit the Board of Directors of Tucker, from (i) furnishing information to or
entering into discussions or negotiations with, any person or entity that makes
an unsolicited bona fide Acquisition Proposal, if, and only to the extent that,
(A) the Board of Directors of Tucker, after consultation with and based upon the
advice of Mayer, Brown & Platt, or another nationally recognized law firm
selected by Tucker, determines in good faith that such action is required for
the Board of Directors to comply with its fiduciary duties to stockholders under
applicable law, (B) prior to furnishing such information to, or entering into
discussions or negotiations with, such person or entity, Tucker provides written
notice to Bradley to the effect that it is furnishing information to, or
entering into discussions or negotiations with, such person or entity, and (C)
Tucker keeps Bradley informed of the status of any such discussions or
negotiations; and (ii) to the extent applicable, complying with Rule 14e-2 and
Rule 14a-9 promulgated under the Exchange Act with regard to an Acquisition
Proposal. Notwithstanding anything to the contrary set forth herein, nothing in
this Section 7.1 shall (x) permit Tucker to terminate this Agreement (except as
specifically provided in Article 9 hereof), (y) except as specifically provided
in Article 9 hereof, permit Tucker or any Tucker Subsidiary to enter into any
agreement with respect to an Acquisition Proposal during the term of this
Agreement (it being agreed that during the term of this Agreement, neither
Tucker nor any Tucker Subsidiary shall enter into any agreement with any person
that provides for, or in any way facilitates, an Acquisition Proposal), or (z)
affect any other obligation of any party under this Agreement.
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<PAGE>
7.2 Conduct of Businesses.
---------------------
(a) Prior to the Effective Time, except as specifically permitted
by this Agreement, unless the other party has consented in writing thereto,
Bradley and Tucker:
(i) Shall use their reasonable best efforts, and shall
cause each of their respective Subsidiaries to use their reasonable best
efforts, to preserve intact their business organizations and goodwill and keep
available the services of their respective officers and employees;
(ii) Shall confer on a regular basis with one or more
representatives of the other to report operational matters of materiality and,
subject to Section 7.1, any proposals to engage in material transactions;
(iii) Shall promptly notify the other of any material
emergency or other material change in the condition (financial or otherwise),
business, properties, assets, liabilities, prospects or the normal course of
their businesses or in the operation of their properties, any material
governmental complaints, investigations or hearings (or communications
indicating that the same may be contemplated), or the breach in any material
respect of any representation or warranty contained herein; and
(iv) Shall promptly deliver to the other true and correct
copies of any report, statement or schedule filed with the SEC subsequent to the
date of this Agreement.
(b) Prior to the Effective Time, unless Bradley has consented as
set forth below in this clause (b) Tucker:
(i) Shall, and shall cause each Tucker Subsidiary to,
conduct its operations according to their usual, regular and ordinary course in
substantially the same manner as heretofore conducted, subject to clauses (ii)-
(xii) below;
(ii) Shall not, and shall cause each Tucker Subsidiary not
to, acquire, enter into an option to acquire or exercise an option or contract
to acquire additional real property, incur additional indebtedness, encumber
assets or commence construction of, or enter into any agreement or commitment to
develop or construct, shopping centers or any other type of real estate projects
(including, but not limited, to options to purchase real property listed on
Section 5.29 of the Tucker Disclosure Letter), except that (i) Tucker may incur
additional indebtedness under the Amended and Restated Revolving Credit
Agreement dated as of June 27, 1994 among TOP, Tucker and The First National
Bank of Boston, as agent, and (ii) except that Tucker may extend the maturity of
the current mortgage financing encumbering the Pavilion at Mequon until June 30,
1996 upon the same terms and conditions which are currently in effect for such
financing;
(iii) Shall not amend its Charter or Bylaws, and shall cause
each Tucker Subsidiary not to amend its Charter, Bylaws, joint venture
documents, partnership agreements or equivalent documents except (A) as
contemplated by this Agreement or (B) in
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<PAGE>
the event that the Merger is not consummated prior to April 1, 1996, Tucker may
adopt an amendment to the TOP Partnership Agreement, substantially in the form
of Exhibit I hereto;
(iv) Shall not (A) except pursuant to the exercise of
options, warrants, conversion rights and other contractual rights existing on
the date hereof and disclosed pursuant to this Agreement, issue any shares of
its capital stock, effect any stock split, reverse stock split, stock dividend,
recapitalization or other similar transaction, (B) grant, confer or award any
option, warrant, conversion right or other right not existing on the date hereof
to acquire any shares of its capital stock, (C) increase any compensation or
enter into or amend any employment agreement with any of its present or future
officers or directors, or (D) adopt any new employee benefit plan (including any
stock option, stock benefit or stock purchase plan) other than the Severance
Plan and the Severance Agreements or amend any existing employee benefit plan in
any material respect, except for changes which are less favorable to
participants in such plans (in connection with the foregoing, Tucker hereby
agrees that (i) the aggregate payments which may be paid after the date hereof
under the Tucker Property Manager Bonus Program shall not exceed $150,000 and
(ii) Tucker shall award a maximum of $25,000 as bonus compensation for employees
who are not executive officers at or immediately prior to the Effective Time);
(v) Shall not (A) declare, set aside or pay any dividend
or make any other distribution or payment with respect to any shares of its
capital stock, except in compliance with Section 7.15 of this Agreement, or (B)
except in connection with the use of shares of capital stock to pay the exercise
price or tax withholding in connection with the Tucker Stock Option Plan,
directly or indirectly redeem, purchase or otherwise acquire any shares of its
capital stock or capital stock of any of the Tucker Subsidiaries, or make any
commitment for any such action;
(vi) Shall not, and shall not permit any of the Tucker
Subsidiaries to, sell, lease or otherwise dispose of (A) any Tucker Properties
or any portion thereof or any of the capital stock of or partnership or other
interests in any of the Tucker Subsidiaries or (B) except in the ordinary course
of business, any of its other assets which are material, individually or in the
aggregate;
(vii) Shall not, and shall not permit any of the Tucker
Subsidiaries to, make any loans, advances or capital contributions to, or
investments in, any other person;
(viii) Shall not, and shall not permit any of the Tucker
Subsidiaries to, pay, discharge or satisfy any claims, liabilities or
obligations (absolute, accrued, asserted or unasserted, contingent or
otherwise), other than the payment, discharge or satisfaction, in the ordinary
course of business consistent with past practice or in accordance with their
terms, of liabilities reflected or reserved against in, or contemplated by, the
most recent consolidated financial statements (or the notes thereto) of Tucker
included in the Tucker Reports or incurred in the ordinary course of business
consistent with past practice;
(ix) Shall not, and shall not permit any of the Tucker
Subsidiaries to, enter into any Commitment which may result in total payments or
liability by or to it in excess
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<PAGE>
of $25,000 (provided, however, that nothing contained in this clause (ix) shall
permit Tucker or any Tucker Subsidiary to take any action prohibited by the
other provisions of this Section 7.2); provided further, that notwithstanding
anything in this Section 7.2(b) to the contrary, Tucker's current Senior Vice
President of Asset Management shall be permitted on behalf of Tucker or a Tucker
Subsidiary to enter into a Commitment (A) to make any repairs and/or prevent
damage to any Tucker Properties as is necessary in the event of an emergency
situation as long as he uses his reasonable best efforts to contact Bradley
prior to entering into such Commitment and provides Bradley with a copy of such
Commitment on the day after such Commitment is entered into and (B) to the
extent that the failure to enter into such Commitment will result in Tucker
being in default under the terms of any of the Tucker Leases so long as Tucker
has provided Bradley with five days prior written notice that it is entering
into such Commitment;
(x) Except for the Severance Plan and the Severance
Agreements, shall not, and shall not permit any of the Tucker Subsidiaries to,
enter into any Commitment with any officer, director, consultant or affiliate of
Tucker or any of the Tucker Subsidiaries;
(xi) Shall provide Bradley with a reasonable opportunity to
review any comment on any federal income tax returns filed by Tucker or any
Tucker Subsidiary prior to the Effective Time; and
(xii) Shall not, without prior notification and consultation
with Bradley, terminate any employee under circumstances which would result in
severance payments to such employee pursuant to the Severance Plan or pay any
severance benefits to any employee under the terms of the Severance Plan on
account of such employee's purported termination for "Good Reason" (within the
meaning of the Severance Plan) on account of a substantial adverse change in his
position, authorities, responsibilities or status.
Bradley shall respond to any consent requested by Tucker pursuant to this
Section 7.2(b) within five (5) business days of the receipt of such request. In
the event no response is received by Tucker by the expiration of such five
business day period, such consent shall be deemed given.
(c) Notwithstanding anything to the contrary set forth in this
Agreement and without limiting any of the other rights of Bradley set forth
herein, between the date of this Agreement and the Effective Time, Bradley and
the Bradley Subsidiaries may enter into leases with respect to all or any
portion of the Bradley Properties, acquire, lease, enter into an option to
acquire, lease or exercise an option or contract to acquire, additional real
property, incur additional indebtedness, encumber assets or commence
construction of, or enter into any agreement or commitment to develop or
construct, shopping centers or other real estate projects.
7.3 Meetings of Stockholders. Each of Bradley and Tucker will take all
------------------------
action necessary in accordance with applicable law and its Charter and Bylaws to
convene a meeting of its stockholders as promptly as practicable to consider and
vote upon the approval of this Agreement and the transactions contemplated
hereby. The Board of Directors of Bradley and
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<PAGE>
Tucker each shall recommend that its stockholders approve this Agreement and the
transactions contemplated hereby and Bradley and Tucker each shall use their
reasonable best efforts to obtain such approval, including, without limitation,
by timely mailing the joint proxy statement/prospectus contained in the Form S-4
(as defined in Section 7.7 hereof) to their respective stockholders; provided,
however, that nothing contained in this Section 7.3 shall prohibit the Board of
Directors of Bradley or the Board of Directors of Tucker from failing to make
such recommendation or using their reasonable best efforts to obtain such
approval if the Board of Directors of Bradley or Tucker, as the case may be, has
determined in good faith, after consultation with and based upon the advice of
Mayer, Brown & Platt or Goodwin, Procter & Hoar, or another nationally
recognized firm selected by Tucker or Bradley, as the case may be, that such
action is necessary for such Board of Directors to comply with its fiduciary
duties to its stockholders under applicable law. Bradley and Tucker shall
coordinate and cooperate with respect to the timing of such meetings and shall
use their reasonable best efforts to hold such meetings on the same day. It
shall be a condition to the mailing of the Form S-4 that (i) Bradley shall have
received a "comfort" letter from Coopers & Lybrand LLP, independent public
accountants for Tucker, dated as of a date within two business days before the
date on which the Form S-4 shall become effective, with respect to the financial
statements of Tucker included or incorporated in the Form S-4, in form and
substance reasonably satisfactory to Bradley, and customary in scope and
substance for "comfort" letters delivered by independent public accountants in
connection with registration statements and proxy statements similar to the Form
S-4, and (ii) Tucker shall have received a "comfort" letter from KPMG Peat
Marwick LLP, independent public accountants for Bradley, dated as of a date
within two business days before the date on which the Form S-4 shall become
effective, with respect to the financial statements of Bradley included or
incorporated in the Form S-4, in form and substance reasonably satisfactory to
Tucker, and customary in scope and substance for "comfort" letters delivered by
independent public accountants in connection with registration statements and
proxy statements similar to the Form S-4.
7.4 Filings; Other Action. Subject to the terms and conditions herein
---------------------
provided, Tucker and Bradley shall: (a) to the extent required, promptly make
their respective filings and thereafter make any other required submissions
under the HSR Act with respect to the Merger; (b) use all reasonable best
efforts to cooperate with one another in (i) determining which filings are
required to be made prior to the Effective Time with, and which consents,
approvals, permits or authorizations are required to be obtained prior to the
Effective Time from, governmental or regulatory authorities of the United
States, the several states and foreign jurisdictions and any third parties in
connection with the execution and delivery of this Agreement, and the Ancillary
Agreements and the consummation of the transactions contemplated by such
agreements and (ii) timely making all such filings and timely seeking all such
consents, approvals, permits or authorizations; (c) use all reasonable best
efforts to obtain in writing any consents required from third parties to
effectuate the Merger, such consents to be in reasonably satisfactory form to
Tucker and Bradley; and (d) use all reasonable best efforts to take, or cause to
be taken, all other action and do, or cause to be done, all other things
necessary, proper or appropriate to consummate and make effective the
transactions contemplated by this Agreement and the Ancillary Agreements. If, at
any time after the Effective Time, any further action is necessary or desirable
to carry out the purpose of this Agreement or the Ancillary Agreements, the
proper officers and directors of Bradley and
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<PAGE>
Tucker shall take all such necessary action.
7.5 Inspection of Records. From the date hereof to the Effective Time,
---------------------
each of Tucker and Bradley shall allow all designated officers, attorneys,
accountants and other representatives of the other access at all reasonable
times to the records and files, correspondence, audits and properties, as well
as to all information relating to commitments, contracts, titles and financial
position, or otherwise pertaining to the business and affairs, of Tucker and
Bradley and their respective subsidiaries.
7.6 Publicity. Bradley and Tucker shall consult with each other before
---------
issuing any press release or otherwise making any public statements with respect
to this Agreement or any transaction contemplated herein and shall not issue any
such press release or make any such public statement without the prior consent
of the other party, which consent shall not be unreasonably withheld; provided,
however, that a party may, without the prior consent of the other party, issue
such press release or make such public statement as may be required by law or
the rules of the NYSE if it has used its reasonable best efforts to consult with
the other party and to obtain such party's consent but has been unable to do so
in a timely manner.
7.7 Registration Statement. Bradley and Tucker shall cooperate and
----------------------
promptly prepare and Bradley shall file with the SEC as soon as practicable a
Registration Statement on Form S-4 under the Securities Act, with respect to the
shares of Bradley Common Stock issuable in the Merger, a portion of which Form
S-4 shall also serve as the joint proxy statement with respect to the meetings
of the stockholders of Tucker and of Bradley in connection with the Merger (in
its entirety, the "Form S-4"). The respective parties will cause the Form S-4 to
comply as to form in all material respects with the applicable provisions of the
Securities Act, the Exchange Act and the rules and regulations thereunder. Each
of Bradley and Tucker shall furnish all information about itself and its
business and operation and all necessary financial information to the other as
the other may reasonably request in connection with the preparation of the Form
S-4. Bradley shall use its reasonable best efforts, and Tucker will cooperate
with Bradley, to have the Form S-4 declared effective by the SEC as promptly as
practicable. Bradley shall use its reasonable best efforts to obtain, prior to
the effective date of the Form S-4, all necessary state securities law or "Blue
Sky" permits or approvals required to carry out the transactions contemplated by
this Agreement and will pay all expenses incident thereto. Bradley agrees that
the Form S-4 and each amendment or supplement thereto at the time of mailing
thereof and at the time of the respective meetings of stockholders of Bradley
and Tucker, will not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; provided, however, that the foregoing shall not apply to the
extent that any such untrue statement of a material fact or omission to state a
material fact was made by Bradley in reliance upon and in conformity with
information concerning Tucker furnished to Bradley by Tucker for use in the Form
S-4. Tucker agrees that the information provided by it for inclusion in the Form
S-4 and each amendment or supplement thereto, at the time of mailing thereof and
at the time of the respective meetings of stockholders of Bradley and Tucker,
will not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were
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<PAGE>
made, not misleading. Bradley will advise and deliver copies (if any) to Tucker,
promptly after it receives notice thereof, of the time when the Form S-4 has
become effective or any supplement or amendment has been filed, the issuance of
any stop order, the suspension of the qualification of the Bradley Common Stock
issuable in connection with the Merger for offering or sale in any jurisdiction,
or any request by the SEC for amendment of the Form S-4 or comments thereon and
responses thereto or requests by the SEC for additional information.
7.8 Listing Application. Bradley shall promptly prepare and submit to
-------------------
the NYSE a listing application covering the shares of Bradley Common Stock
issuable in the Merger, and shall use its best efforts to obtain, prior to the
Effective Time, approval for the listing of such Bradley Common Stock, subject
to official notice of issuance.
7.9 Further Action. Each party hereto shall, subject to the fulfillment
--------------
at or before the Effective Time of each of the conditions of performance set
forth herein or the waiver thereof, perform such further acts and execute such
documents as may reasonably be required to effect the Merger. Without limiting
the foregoing, at the Closing, Tucker shall deliver, deeds, affidavits or other
documents necessary for Bradley to obtain endorsements to existing title
insurance policies or new title insurance policies which (i) insure that Bradley
is the general partner (by merger) of the record owner of the Tucker Properties,
subject only to the Encumbrances and (ii) contain a so-called "non-imputation"
endorsement (such non-imputation endorsement insuring that Bradley will not be
charged with the imputed knowledge of Tucker, the Tucker Subsidiaries and
Affiliates thereof). In connection with the Closing, Tucker and each Tucker
Subsidiary shall use its best efforts to deliver to Bradley such deeds, bills of
sale, assignments, certificates and affidavits as are required to effectuate the
consummation of the transactions described herein.
7.10 Affiliates of Tucker.
--------------------
(a) At least 30 days prior to the Closing Date, Tucker shall
deliver to Bradley a list of names and addresses of those persons who were, in
Tucker's reasonable judgment, at the record date for its stockholders' meeting
to approve the Merger, "affiliates" (each such person, an "Affiliate") of Tucker
within the meaning of Rule 145. Tucker shall provide Bradley such information
and documents as Bradley shall reasonably request for purposes of reviewing such
list. Tucker shall use its reasonable best efforts to deliver or cause to be
delivered to Bradley, prior to the Closing Date, from each of the Affiliates of
Tucker identified in the foregoing list, an Affiliate Letter in the form
attached hereto as Exhibit D. Bradley shall be entitled to place legends as
specified in such Affiliate Letters on the certificates evidencing any shares of
Bradley Common Stock to be received by such Affiliates pursuant to the terms of
this Agreement, and to issue appropriate stop transfer instructions to the
transfer agent for the shares of Bradley Common Stock, consistent with the terms
of such Affiliate Letters.
(b) Bradley shall file the reports required to be filed by it
under the Exchange Act and the rules and regulations adopted by the SEC
thereunder, and it will take such further action as any Affiliate of Tucker may
reasonably request, all to the extent required from time to time to enable such
Affiliate to sell shares of Bradley Common Stock
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<PAGE>
received by such Affiliate in the Merger without registration under the
Securities Act pursuant to (i) Rule 145(d)(1) or (ii) any successor rule or
regulation hereafter adopted by the SEC.
7.11 Expenses. Subject to the provisions of Article 9, all costs and
--------
expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such expenses, except
that (a) the filing fee in connection with the HSR Act filing, if any, (b) the
filing fee in connection with the filing of the Form S-4 or Proxy
Statement/Prospectus with the SEC and (c) the expenses incurred for printing and
mailing the Form S-4, shall be shared equally by Tucker and Bradley. All costs
and expenses for professional services rendered pursuant to the transactions
contemplated by this Agreement including, but not limited to, investment banking
and legal services, will be paid by each party incurring such services .
7.12 Indemnification.
---------------
(a) Bradley agrees that all rights to indemnification or
exculpation now existing in favor of the directors, officers, employees,
advisors and agents of Tucker and the Tucker Subsidiaries (including, without
limitation, TOP) as provided in their respective charters or By-Laws in effect
as of the date hereof with respect to matters occurring at or prior to the
Effective Time shall survive the Merger and shall continue in full force and
effect. For a period of six years after the Effective Time, Bradley shall not
amend, repeal or otherwise modify the provisions in its Charter and Bylaws
providing for exculpation of director liability and indemnification in any
manner that would materially and adversely affect the rights thereunder of
individuals who at any time prior to the Effective Time were directors,
officers, employees, advisors or agents of Tucker in respect of actions or
omissions occurring at or prior to the Effective Time (including, without
limitation, the transactions contemplated by this Agreement), unless such
modification is required by law; provided, however, that in the event any claim
or claims are asserted or made either prior to the Effective Time or within such
six year period, all rights to indemnification in respect of any such claim or
claims shall continue until disposition of any and all such claims. In
connection with the execution of this Agreement, all directors of Tucker shall
enter into amendments to their existing indemnification agreements with Tucker
and Bradley, substantially in the form of Exhibit H hereto, which will be
effective as of the Effective Time. Nothing in the following paragraphs of this
Section 7.12 shall create an inference, either by omission or inclusion, that
limits in any way the rights set forth herein.
(b) In addition to the rights provided in Section 7.12(a) above,
in the event of any threatened or actual claim, action, suit, proceeding or
investigation, whether civil, criminal or administrative, including, without
limitation, any action by or on behalf of any or all security holders of Tucker
or Bradley or by or in the right of Tucker or Bradley or any claim, action,
suit, proceeding or investigation in which any person who is now, or has been,
at any time prior to the date hereof, or who becomes prior to the Effective
Time, a director of Tucker (the "Indemnified Parties"), is, or is threatened to
be, made a party based in whole or in part on, or arising in whole or in part
out of, or pertaining to (i) the fact that he is or was a director of Tucker or
any of the Tucker Subsidiaries (including, without limitation, TOP) or any
action or omission by such person in his capacity as a director, or (ii) this
Agreement or
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<PAGE>
the transactions contemplated by this Agreement, whether in any case asserted or
arising before or after the Effective Time, Bradley on one hand and the
Indemnified Parties on the other hand, hereto agree to cooperate and use their
reasonable best efforts to defend against and respond thereto. It is understood
and agreed that, after the Effective Time, Bradley shall indemnify and hold
harmless, as and to the full extent permitted by applicable law, each
Indemnified Party against any losses, claims, liabilities, expenses (including
reasonable attorneys' fees and expenses), judgments, fines and amounts paid in
settlement in connection with any such threatened or actual claim, action, suit,
proceeding or investigation. In addition, after the Effective Time, in the event
of any such threatened or actual claim, action, suit, proceeding or
investigation, Bradley shall promptly pay and advance expenses and costs
incurred by each Indemnified Person as they become due and payable in advance of
the final disposition of any claim, action, suit, proceeding or investigation to
the fullest extent and in the manner permitted by law. Notwithstanding the
foregoing, Bradley shall pay for only one counsel and one local counsel for all
Indemnified Parties unless the use of one such counsel and one local counsel for
such Indemnified Parties would present such counsel with a conflict of interest,
in which case Bradley shall employ other counsel to the extent necessary to
avoid a conflict of interest with any counsel or party involved in the matter.
Notwithstanding anything to the contrary set forth in this Agreement, Bradley
(i) shall not be liable for any settlement effected without its prior written
consent, and (ii) shall not have any obligation hereunder to any Indemnified
Party if a court of competent jurisdiction shall determine in a final and non-
appealable order that indemnification of such Indemnified Party in the manner
contemplated hereby is prohibited by applicable law. In the event of such a
final and non-appealable determination by a court that such indemnification is
prohibited by applicable law, the Indemnified Person shall promptly refund to
Bradley the amount of all expenses theretofore advanced pursuant hereto. Any
Indemnified Party wishing to claim indemnification under this Section, upon
learning of any such claim, action, suit, proceeding or investigation, shall
promptly notify Bradley of such claim and the relevant facts and circumstances
with respect thereto, provided that the failure to provide such notice shall not
affect the obligations of Bradley except to the extent such failure to notify
materially prejudices Bradley's ability to defend such claim, action, suit,
proceeding or investigation.
(c) At or prior to the Effective Time, Bradley shall purchase
directors' liability insurance policy coverage for Tucker's directors and
Executive Officers as provided in Schedule 7.12 hereto.
(d) This Section 7.12 is intended for the irrevocable benefit of,
and to grant third party rights to, the Indemnified Parties and their
successors, assigns and heirs and shall be binding on all successors and assigns
of Bradley. Each of the Indemnified Parties shall be entitled to enforce the
covenants contained in this Section 7.12 and Bradley acknowledges and agrees
that each Indemnified Party would suffer irreparable harm and that no adequate
remedy at law exists for a breach of such covenants.
(e) To the extent permitted by law, all rights of indemnification
for the benefit of any director of Tucker shall be mandatory rather than
permissive.
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(f) Any determination required to be made with respect to whether
a party's conduct complies with the standards set forth in the Charter or By-
Laws of the Surviving Corporation or under applicable law shall be made by (i)
Sidley & Austin or (ii) in the event Sidley & Austin shall not be available to
make such determination, then Skadden, Arps, Slate, Meagher & Flom or (iii) in
the event that neither Sidley & Austin nor Skadden, Arps, Slate, Meagher & Flom
shall be available to make such determination, then Kirkland & Ellis, or (iv) in
the event that none of Sidley & Austin, Skadden, Arps, Slate, Meagher & Flom or
Kirkland & Ellis shall be available to make such determination, then O'Melveny &
Myers (in each case whose reasonable fees and expenses shall be paid by the
Surviving Corporation).
(g) Notwithstanding anything to the contrary set forth in this
Agreement, in the event any Indemnified Party is required to file suit against
Bradley to enforce the indemnity obligations provided for in this Section, it
shall be entitled to all expenses, including reasonable attorneys' fees and
expenses, which it has incurred in enforcing its rights hereunder.
(h) In the event that Bradley or any of its successors or assigns
(i) consolidates with or merges into any other person or entity and shall not be
the continuing or surviving corporation or entity of such consolidation or
merger or (ii) transfers or conveys all or substantially all of its properties
and assets to any person or entity, then, and in each such case, proper
provision shall be made so that the successors and assigns of Bradley assume the
obligations set forth in this Section.
7.13 Reorganization. From and after the date hereof and until the
--------------
Effective Time, neither Bradley nor Tucker nor any of their respective
subsidiaries or other affiliates shall (i) knowingly take any action, or
knowingly fail to take any action, that would jeopardize qualification of the
Merger as a reorganization within the meaning of Section 368(a)(1)(A) of the
Code or (ii) enter into any contract, agreement, commitment or arrangement with
respect to the foregoing. Following the Effective Time, Bradley shall use its
best efforts to conduct its business in a manner that would not jeopardize the
characterization of the Merger as a reorganization within the meaning of Section
368(a) of the Code.
7.14 Certain Benefits.
----------------
(a) Bradley agrees that Tucker and the Tucker Subsidiaries, and
the Surviving Corporation and its subsidiaries after the Effective Time, will
provide benefit plans to employees of Tucker and the Tucker Subsidiaries that,
at the option of Bradley, either (i) will be no less favorable, in the
aggregate, than those provided by Bradley and the Bradley Subsidiaries to their
employees or (ii) will, in the aggregate, be no less favorable than those
provided by Tucker and the Tucker Subsidiaries to their employees immediately
prior to the date of this Agreement. Nothing contained in this Agreement shall
be construed to grant any right of continued employment to any present employee
of Tucker or any of the Tucker Subsidiaries.
(b) Except for normal increases in the ordinary course of business
that are consistent with past practices and cost increases of third party
providers necessary to maintain
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<PAGE>
benefits at current levels that, in the aggregate, do not result in a material
increase in benefits or compensation expense to Tucker or any of the Tucker
Subsidiaries or as set forth in Section 5.16 of the Tucker Disclosure Letter,
Tucker will not, and will not permit any of the Tucker Subsidiaries to, adopt or
amend (except as may be required by law and except for the establishment of the
Severance Plan and the Severance Agreements) any bonus, profit sharing,
compensation, severance, termination, stock option, pension, retirement,
deferred compensation, employment or other employee benefit agreements, trusts,
plans, funds or other arrangements for the benefit or welfare of any director,
officer or employee that increase in any manner the compensation, retirement,
welfare or fringe benefits of any director, officer or employee or pay any
benefit not required by any existing plan or arrangement (including without
limitation the granting of stock options) or take any action or grant any
benefit not expressly required under the terms of any existing agreements,
trusts, plans, funds or other such arrangements or enter into any contract,
agreement, commitment or arrangement to any of the foregoing.
7.15 Dividends.
---------
(a) Prior to the Effective Time, Tucker and Bradley shall
cooperate and coordinate with each other so that (i) the record date for regular
quarterly dividends and distributions with respect to the fourth quarter of 1995
and thereafter until the Effective Time shall occur on the same date, (ii) the
payment date for each such regular quarterly dividend and distribution shall be
on the last day of such applicable quarter, and (iii) the amount of each such
regular quarterly dividend and distribution shall not exceed $.25 per quarter
for Tucker and $.33 per quarter for Bradley.
(b) For its taxable year ending at the Effective Time (the "Short
Taxable Year") Tucker will not have any (i) "net income from foreclosure
property" as defined by Section 857(b)(4) of the Code or (ii) "net income
derived from prohibited transactions" as defined by Section 857(b)(6) of the
Code. Immediately prior to the Effective Time, Tucker will cause to be
distributed a dividend (within the meaning of Section 316 of the Code) to its
stockholders (the "Merger Dividend") of an amount such that (i) Tucker's "real
estate investment trust taxable income" as defined in Section 857(b)(2) of the
Code for the Short Taxable Year shall equal zero; (ii) Tucker's current and
accumulated earnings and profits as described in Section 312 of the Code for the
Short Taxable Year shall equal zero; and (iii) Tucker's "deduction for dividends
paid during the taxable year" (within the meaning of Sections 561 and 857(a)(1)
of the Code and determined without regard to "capital gain dividends" within the
meaning of Section 857(b) of the Code) for the Short Taxable Year will equal or
exceed the amount set forth in Section 857(a)(1)(A) and (B) of the Code.
(c) Tucker will do all things necessary to ensure that it
continues to meet all of the requirements to be treated as a REIT for all
purposes under the Code and the income tax provisions of the State of Illinois
(and any other state in which Tucker is subject to tax and which provides for
the taxation of REITs in a manner similar to the treatment of REITs under
Sections 856-860 of the Code) and shall make any and all required filings in
connection therewith, including providing Bradley with all information,
documentation and assistance Bradley may reasonably request in order for Bradley
to mail the stockholder demand letters
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<PAGE>
required by Treasury Regulation 1.857-8 within 30 days after the Effective Time
and to take any other actions that may be necessary or appropriate for Bradley,
as the Surviving Corporation, to take in order to maintain Tucker's status as a
REIT through the Effective Time.
(d) Bradley shall pay a dividend in connection with the Closing to
its stockholders in an amount per share equal to the quotient obtained by
dividing (x) the Merger Dividend per share paid by Tucker pursuant to Section
7.15(b) by (y) the Exchange Ratio.
(e) Until the Effective Time, Bradley shall not declare, set aside
or pay any dividend or make any other distribution or payment with respect to
any of its respective shares of capital stock which is "extraordinary." For the
purposes of this Agreement, a dividend, distribution or payment with respect to
capital stock shall be considered "extraordinary" if (a) the Board of Directors
of Bradley designates such cash payment as "extraordinary" when declared or (b)
the amount by which any cash payment exceeds 200% of the most recent cash
dividend declared by the Board of Directors of Bradley.
7.16 IRS Private Letter Ruling. Tucker shall cooperate and assist
-------------------------
Bradley in submitting an application for and obtaining the private letter ruling
from the IRS which is described in Section 8.3(i) hereto.
ARTICLE 8
8. Conditions.
----------
8.1 Conditions to Each Party's Obligation to Effect the Merger. The
----------------------------------------------------------
respective obligation of each party to effect the Merger and the other
transactions contemplated herein shall be subject to the fulfillment at or prior
to the Effective Time of the following conditions, any or all of which may be
waived, in whole or in part by the parties hereto, to the extent permitted by
applicable law:
(a) This Agreement and the transactions contemplated hereby shall
have been approved by the requisite vote of stockholders of Bradley and Tucker.
(b) The waiting period applicable to the consummation of the
Merger under the HSR Act, if applicable, shall have expired or been terminated.
(c) Neither of the parties hereto shall be subject to any order,
ruling or injunction of a court of competent jurisdiction which prohibits the
consummation of the transactions contemplated by this Agreement. In the event
any such order, ruling or injunction shall have been issued, each party agrees
to use its best efforts to have any such order, ruling or injunction lifted,
stayed or reversed.
(d) The Form S-4 shall have been declared effective by the SEC
under the Securities Act, and no stop order suspending the effectiveness of the
Form S-4 shall have been
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<PAGE>
issued by the SEC, and no proceedings for that purpose shall have been initiated
or, to the knowledge of Bradley or Tucker, threatened by the SEC.
(e) Bradley shall have obtained the approval for the listing of
the shares of Bradley Common Stock issuable in the Merger on the NYSE, subject
to official notice of issuance.
(f) The consents set forth in Schedule 8.1(f) hereof shall have
been obtained. All other consents, authorizations, orders and approvals of (or
filings or registrations with) any governmental commission, board, other
regulatory body or third parties required to be made or obtained by Bradley,
Tucker and their respective subsidiaries and affiliated entities in connection
with the execution, delivery and performance of this Agreement and the Ancillary
Agreements shall have been obtained or made, except where the failure to have
obtained or made any such consent, authorization, order, approval, filing or
registration, would not have (i) a Tucker Material Adverse Effect or (ii) a
Bradley Material Adverse Effect, as the case may be.
8.2 Conditions to Obligations of Tucker to Effect the Merger. The
--------------------------------------------------------
obligation of Tucker to effect the Merger shall be subject to the fulfillment at
or prior to the Closing Date of the following conditions, unless waived by
Tucker:
(a) Each of the representations and warranties of Bradley
contained in this Agreement shall be true and correct in all material respects
as of the date of this Agreement and as of the Effective Time as though made on
and as of the Effective Time and Tucker shall have received a certificate, dated
the Closing Date, signed on behalf of Bradley by the President of Bradley to the
foregoing effect.
(b) Bradley shall have performed or complied in all material
respects with all agreements and covenants required by this Agreement to be
performed or complied with by it on or prior to the Effective Time, and Tucker
shall have received a certificate, dated the Closing Date, signed on behalf of
Bradley by the President of Bradley to the foregoing effect.
(c) Tucker shall have received the opinion of Mayer, Brown &
Platt, or another nationally recognized law firm selected by Tucker, dated not
less than five business days prior to the date the Form S-4 is declared
effective by the SEC, reasonably acceptable to Tucker, and subject to customary
conditions and qualifications (including reliance, in part, on representations
of Bradley and Tucker and certain stockholders of Tucker), to the effect that
the Merger will be treated for federal income tax purposes as a tax-free
reorganization qualifying under the provisions of Sections 368(a)(1)(A) of the
Code, which opinion shall not have been withdrawn or modified in any material
respect.
(d) At closing, Tucker shall have received the opinion of Goodwin,
Procter & Hoar, or another nationally recognized law firm selected by Bradley,
in form and substance reasonably satisfactory to Tucker, to the effect that, for
all applicable tax years for which Bradley's federal income tax returns are
subject to audit and Bradley is subject to assessment
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<PAGE>
for taxes reportable therein and through the date of the Closing, Bradley has
qualified to be taxed as a REIT under Sections 856 through 860 of the Code.
(e) From the date of this Agreement through the Effective Time,
there shall not have occurred any change concerning Bradley or any of the
Bradley Subsidiaries that has had or could be reasonably likely to have a
Bradley Material Adverse Effect and Tucker shall have received a certificate,
dated the Closing Date, signed on behalf of Bradley by the President of Bradley
to the foregoing effect.
8.3 Conditions to Obligation of Bradley to Effect the Merger. The
--------------------------------------------------------
obligations of Bradley to effect the Merger shall be subject to the fulfillment
at or prior to the Closing Date of the following conditions, unless waived by
Bradley:
(a) Each of the representations and warranties of Tucker contained
in this Agreement shall be true and correct in all material respects as of the
date of this Agreement and as of the Effective Time as though made on and as of
the Effective Time, and Bradley shall have received a certificate, dated the
Closing Date, signed on behalf of Tucker by the President of Tucker to the
foregoing effect.
(b) Tucker shall have performed or complied in all material
respects with all agreements and covenants required by this Agreement to be
performed or complied with by it on or prior to the Effective Time, and Bradley
shall have received a certificate, dated the Closing Date, signed on behalf of
Tucker by the President of Tucker to the foregoing effect.
(c) Bradley shall have received the opinion of Goodwin, Procter &
Hoar, or another nationally recognized law firm selected by Bradley, dated not
less than five business days prior to the date the Form S-4 is declared
effective by the SEC, reasonably acceptable to Bradley, and subject to customary
conditions and qualifications (including reliance, in part, on representations
of Bradley and Tucker and certain stockholders of Tucker), to the effect that
the Merger will be treated for federal income tax purposes as a tax-free
reorganization qualifying under the provisions of Sections 368(a)(1)(A) of the
Code, which opinion shall not have been withdrawn or modified in any material
respect.
(d) At closing, Bradley shall have received (i) the opinion of
Mayer, Brown & Platt, or another nationally recognized law firm selected by
Tucker, in form and substance reasonably satisfactory to Bradley, to the effect
that, for the taxable year ended December 31, 1995 and for the short taxable
year ending at the date of the Closing, Tucker has qualified to be taxed as a
REIT under Sections 856 through 860 of the Code and (ii) the opinion of Coopers
& Lybrand LLP, independent public accountants for Tucker, in form and substance
reasonably satisfactory to Bradley, to the effect that for the taxable years
ended December 31, 1993 and December 31, 1994, Tucker qualified to be taxed as a
REIT under Section 856 through 860 of the Code.
(e) From the date of this Agreement through the Effective Time,
there shall not have occurred any change concerning Tucker or any of the Tucker
Subsidiaries, that has had or could be reasonably likely to have a Tucker
Material Adverse Effect and Bradley shall
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<PAGE>
have received a certificate, dated the Closing Date, signed on behalf of Tucker
by the President of Tucker to the foregoing effect.
(f) Tucker shall have obtained and delivered to Bradley estoppel
certificates dated no earlier than 45 days prior to the Effective Time with
respect to (x) each of the leases and REA Agreements set forth on Schedule
8.3(f) hereof and (y) leases representing a total of 50% of the total rented
space of each Tucker Property, other than rented space represented by the leases
listed on Schedule 8.3(f) hereof. Such estoppel certificates shall either be (x)
substantially in the form of Exhibit E hereto or (y) in the form required by the
applicable lease.
(g) Tucker and all of the limited partners of TOP shall have
executed the amended and restated TOP Partnership Agreement in the form attached
hereto as Exhibit B and the transfers of securities contemplated by Section 1.5
of this Agreement and all of the actions described in Section 1.6 of this
Agreement have been consummated or shall have occurred.
(h) Bradley shall have obtained a letter from Coopers & Lybrand
LLP, independent public accountants for Tucker, in form and substance reasonably
satisfactory to Bradley, certifying that (i) Tucker has satisfied the
requirements of Section 7.15(b) of this Agreement and (ii) for federal income
tax purposes, Tucker will not have any accumulated or current earnings or
profits immediately prior to the Effective Time.
(i) Bradley shall have received a private letter ruling from the
IRS, in form and substance reasonably satisfactory to Bradley, to the effect
that following the consummation of the Merger, each of TFC and Tucker Properties
Investment, Inc. will qualify as a "qualified REIT subsidiary" of Bradley under
Section 856(i) of the Code.
ARTICLE 9
9. Termination.
-----------
9.1 Termination. This Agreement may be terminated and abandoned at any
-----------
time prior to the Effective Time, whether before or after approval and adoption
of this Agreement by the stockholders of Tucker and Bradley:
(a) by mutual written consent of Bradley and Tucker; or
(b) by either Bradley or Tucker if any United States federal or
state court of competent jurisdiction or other governmental entity shall have
issued an order, decree or ruling or taken any other action permanently
restraining, enjoining or otherwise prohibiting the Merger and such order,
decree, ruling or other action shall have become final and non-appealable,
provided that the party seeking to terminate shall have used its best efforts to
appeal such order, decree, ruling or other action; or
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<PAGE>
(c) by Bradley upon a breach of any representation, warranty,
covenant or agreement on the part of Tucker set forth in this Agreement, or if
any representation or warranty of Tucker shall have become untrue, in either
case such that the conditions set forth in Section 8.3(a) or Section 8.3(b), as
the case may be, would be incapable of being satisfied by June 30, 1996;
provided, however, that, in any case, a willful breach shall be deemed to cause
- -------- -------
such conditions to be incapable of being satisfied for purposes of this Section
9.1(c);
(d) by Tucker upon a breach of any representation, warranty,
covenant or agreement on the part of Bradley set forth in this Agreement, or if
any representation or warranty of Bradley shall have become untrue, in either
case such that the conditions set forth in Section 8.2(a) or Section 8.2(b), as
the case may be, would be incapable of being satisfied by June 30, 1996;
provided, however, that, in any case, a willful breach shall be deemed to cause
- -------- -------
such conditions to be incapable of being satisfied for purposes of this Section
9.1(d);
(e) by Bradley if (i) the Board of Directors of Tucker shall have
failed to make, or shall have withdrawn, amended, modified or changed its
approval or recommendation of this Agreement or any of the transactions
contemplated hereby; (ii) Tucker shall have failed as soon as practicable to
mail the Form S-4 to its stockholders or to include the recommendation of its
Board of Directors of this Agreement and the transactions contemplated hereby in
the Form S-4; (iii) the Board of Directors of Tucker shall have recommended that
stockholders of Tucker accept or approve an Acquisition Proposal by a person
other than Bradley (or Tucker or its Board shall have resolved to do such); or
(iv) Tucker or its Board of Directors shall have resolved to do any of the
foregoing;
(f) by Tucker, if the Board of Directors of Tucker recommends to
Tucker's stockholders approval or acceptance of a Acquisition Proposal by a
person other than Bradley, but only in the event that the Board of Directors of
Tucker, after consultation with and based upon the advice of Mayer, Brown &
Platt or another nationally recognized law firm, has determined in good faith
that such action is necessary for the Board of Directors of Tucker to comply
with its fiduciary duties to its stockholders under applicable law;
(g) by either Bradley or Tucker if this Agreement and the
transactions contemplated hereby shall have failed to receive the requisite vote
for approval and adoption by the stockholders of Bradley or Tucker upon the
holding of a duly convened stockholder meeting;
(h) by Tucker if (i) the Board of Directors of Bradley shall have
failed to make, or shall have withdrawn, amended, modified or changed its
approval or recommendation of this Agreement or the Merger or (ii) if the Board
of Directors of Bradley recommends to Bradley's stockholders approval or
acceptance of a proposal by a person other than Tucker to acquire 50% or more of
the assets or stock of Bradley, by way of merger, tender offer, exchange offer
or similar transaction; or
(i) by either Bradley or Tucker, if the Merger shall not have been
consummated on or before June 30, 1996 (other than due to the failure of the
party seeking to
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<PAGE>
terminate this Agreement to perform its obligations under this Agreement
required to be performed by it at or prior to the Effective Time).
The right of any party hereto to terminate this Agreement pursuant to this
Section 9.1 shall remain operative and in full force and effect regardless of
any investigation made by or on behalf of any party hereto, any person
controlling any such party or any of their respective employees, officers,
directors, agents, representatives or advisors, whether prior to or after the
execution of this Agreement.
9.2 Effect of Termination.
---------------------
(a) In the event of the termination and abandonment of this
Agreement pursuant to Section 9.1 hereof, this Agreement shall forthwith become
void and have no effect, without any liability on the part of any party hereto
or its affiliates, directors, officers or stockholders and all rights and
obligations of any party hereto shall cease except for agreements contained in
Section 10.5; provided, however, that nothing contained in this Section 9.2
shall relieve any party from liability for any breach of this Agreement or shall
relieve Tucker from any liability under this Article 9.
(b) If (x) Bradley terminates this Agreement pursuant to Section
9.1(e)(iii) or pursuant to 9.1(c) as a result of a willful breach by Tucker or
(y) Tucker terminates this Agreement pursuant to Section 9.1(f), then Tucker
shall pay to Bradley an amount (the "Termination Amount") in cash equal to the
sum of (i) $3,000,000, plus (ii) Bradley's out-of-pocket costs and expenses, in
connection with this Agreement and the transactions contemplated hereby,
including, without limitation, fees and disbursements of accountants, attorneys
and investment bankers, up to a maximum of $2,000,000 in accordance with the
provisions of Section 9.3.
(c) If Bradley terminates this Agreement pursuant to Section
9.1(e)(i), 9.1(e)(ii), 9.1(e)(iv) or 9.1(c) (except for a termination because of
a willful breach by Tucker in which case the provisions of Section 9.2(b) will
apply), Tucker shall pay all of Bradley's out-of-pocket costs and expenses, in
connection with this Agreement and the transactions contemplated hereby,
including, without limitation, fees and disbursements of accountants, attorneys
and investment bankers up to a maximum of $2,000,000 ("Expenses") in accordance
with the provisions of Section 9.3.
(d) If at any time prior to or within one year after termination
of this Agreement (unless such termination was pursuant to Section 9.1(a), (b),
(d), (g), (h) or (i)) Tucker enters into an agreement relating to an Acquisition
Proposal with a person other than Bradley or Tucker's Board of Directors
recommends or resolves to recommend to Tucker's stockholders approval or
acceptance of an Acquisition Proposal with a person other than Bradley, then,
upon the entry into such agreement or the making of such recommendation or
resolution, Tucker shall pay to Bradley the Termination Amount in accordance
with the provisions of Section 9.3 which amount shall be reduced by any monies
previously paid by Tucker to Bradley pursuant to Section 9.2(b) or Section
9.2(c).
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<PAGE>
(e) At any time prior to or within one year after termination of
this Agreement, Tucker shall not enter into any agreement relating to an
Acquisition Proposal with a person other than Bradley unless such agreement
provides that such person shall, upon the execution of such agreement, pay any
Termination Amount due Bradley under this Section 9.2. All such amounts shall be
paid in accordance with the provisions of Section 9.3.
(f) The parties acknowledge and agree that the provisions for
payment of Expenses and/or the Termination Amount are included herein in order
to induce Bradley to enter into this Agreement and to reimburse Bradley for
incurring the costs and expenses related to entering into this Agreement and
consummating the transactions contemplated by this Agreement. The parties hereto
agree that Bradley's rights to payment of the Expenses and/or Termination Amount
shall be in addition to any other rights or remedies under contract, at law or
in equity to which Bradley may be entitled.
(g) Notwithstanding any provision to the contrary herein, the
aggregate amount of the Termination Amount or Expenses, as the case may be,
payable to Bradley pursuant to this Section 9.2 shall be subject to the
limitations set forth in Section 9.3.
9.3 Payment of Termination Amount or Expenses.
-----------------------------------------
(a) In the event that Tucker is obligated to pay Bradley the
Termination Amount and/or Expenses pursuant to Section 9.2 (the "Section 9.2
Amount"), Tucker (or any other person to the extent provided by Section 9.2(d))
shall pay to Bradley from the applicable Section 9.2 Amount deposited into
escrow in accordance with the next sentence, an amount equal to the lesser of
(m) the Section 9.2 Amount and (n) the sum of (1) the maximum amount that can be
paid to Bradley without causing Bradley to fail to meet the requirements of
Sections 856(c)(2) and (3) of the Code determined as if the payment of such
amount did not constitute income described in Sections 856(c)(2)(A)-(H) or
856(c)(3)(A)-(I) of the Code ("Qualifying Income"), as determined by Bradley's
certified public accountants, plus (2) in the event Bradley receives either (X)
a letter from Bradley's counsel indicating that Bradley has received a ruling
from the IRS described in Section 9.3(b)(ii) or (Y) an opinion from Bradley's
counsel as described in Section 9.3(b)(ii), an amount equal to the Section 9.2
Amount less the amount payable under clause (1) above. To secure Tucker's
obligation to pay these amounts, Tucker shall deposit into escrow an amount in
cash equal to the Section 9.2 Amount with an escrow agent selected by Bradley
and on such terms (subject to Section 9.3(b)) as shall be agreed upon by Bradley
and the escrow agent. The payment or deposit into escrow of the Section 9.2
Amount pursuant to this Section 9.3(a) shall be made within three days of the
event which gives rise to the payment of the Section 9.2 Amount by wire transfer
or bank check.
(b) The escrow agreement shall provide that the Section 9.2 Amount
in escrow or any portion thereof shall not be released to Bradley unless the
escrow agent receives any one or combination of the following: (i) a letter from
Bradley's certified public accountants indicating the maximum amount that can be
paid by the escrow agent to Bradley without causing Bradley to fail to meet the
requirements of Sections 856(c)(2) and (3) of the Code determined as if the
payment of such amount did not constitute Qualifying Income or a
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<PAGE>
subsequent letter from Bradley's accountants revising that amount, in which case
the escrow agent shall release such amount to Bradley, or (ii) a letter from
Bradley's counsel indicating that Bradley received a ruling from the IRS holding
that the receipt by Bradley of the Section 9.2 Amount would either constitute
Qualifying Income or would be excluded from gross income within the meaning of
Sections 856(c)(2) and (3) of the Code (or alternatively, Bradley's legal
counsel has rendered a legal opinion to the effect that the receipt by Bradley
of the Section 9.2 Amount would either constitute Qualifying Income or would be
excluded from gross income within the meaning of Sections 856(c)(2) and (3) of
the Code), in which case the escrow agent shall release the remainder of the
Section 9.2 Amount to Bradley. Tucker agrees to amend this Section 9.3 at the
request of Bradley in order to (x) maximize the portion of the Section 9.2
Amount that may be distributed to Bradley hereunder without causing Bradley to
fail to meet the requirements of Sections 856(c)(2) and (3) of the Code, (y)
improve Bradley's chances of securing a favorable ruling described in this
Section 9.3(b) or (z) assist Bradley in obtaining a favorable legal opinion from
its counsel as described in this Section 9.3(b); provided that Bradley's legal
counsel has rendered a legal opinion to Bradley to the effect that such
amendment would not cause Bradley to fail to meet the requirements of Section
856(c)(2) or (3) of the Code. The escrow agreement shall also provide that any
portion of the Section 9.2 Amount held in escrow for five years shall be
released by the escrow agent to Tucker. Tucker shall not be a party to such
escrow agreement and shall not bear any cost of or have liability resulting from
the escrow agreement.
(c) Notwithstanding anything to the contrary set forth in this
Agreement, in the event Bradley is required to file suit to seek all or a
portion of Termination Amount and/or the Expenses, it shall be entitled to all
expenses, including attorneys' fees and expenses, which it has incurred in
enforcing its rights hereunder; provided that payment of such expenses shall be
subject to the limitations of Section 9.3(a) (determined as if such expenses
were included in the Section 9.2 Amount).
9.4 Extension; Waiver. At any time prior to the Effective Time, any
-----------------
party hereto, by action taken by its Board of Directors, may, to the extent
legally allowed, (a) extend the time for the performance of any of the
obligations or other acts of the other parties hereto, (b) waive any
inaccuracies in the representations and warranties made to such party contained
herein or in any document delivered pursuant hereto and (c) waive compliance
with any of the agreements or conditions for the benefit of such party contained
herein. Any agreement on the part of a party hereto to any such extension or
waiver shall be valid only if set forth in an instrument in writing signed on
behalf of such party.
ARTICLE 10
10. General Provisions.
------------------
10.1 Nonsurvival of Representations, Warranties and Agreements. All
---------------------------------------------------------
representations, warranties and agreements in this Agreement or in any
instrument delivered pursuant to this Agreement shall not survive the Merger,
provided, however, that the
- -------- -------
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<PAGE>
agreements contained in Article 4, the last sentence of Section 7.4 and Sections
7.10, 7.12, 7.13 and 7.14 and this Article 10 shall survive the Merger.
10.2 Notices. Any notice required to be given hereunder shall be in
-------
writing and shall be sent by facsimile transmission (confirmed by any of the
methods that follow), courier service (with proof of service), hand delivery or
certified or registered mail (return receipt requested and first-class postage
prepaid) and addressed as follows:
If to Bradley: E. Lawrence Miller, President
Bradley Real Estate, Inc.
250 Boylston Street
Boston, MA 02116
Fax No. (617) 266-9453
With copies to: William B. King, P.C.
Goodwin, Procter & Hoar
Exchange Place
Boston, MA 02109
Fax No. (617) 523-1231
If to Tucker: Kenneth L. Tucker, President
Tucker Properties Corporation
40 Skokie Boulevard
Northbrook, IL 60062
Fax No. (708) 272-9931
With copies to: Edward J. Schneidman, Esq.
Mayer, Brown & Platt
190 S. LaSalle Street
Chicago, IL 60603-3441
Fax No. (312) 701-7711
or to such other address as any party shall specify by written notice so given,
and such notice shall be deemed to have been delivered as of the date so
delivered.
10.3 Assignment; Binding Effect; Benefit. Neither this Agreement nor any
-----------------------------------
of the rights, interests or obligations hereunder shall be assigned by any of
the parties hereto (whether by operation of law or otherwise) without the prior
written consent of the other parties. Subject to the preceding sentence, this
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and assigns. Notwithstanding anything
contained in this Agreement to the contrary, except for the provisions of
Article 4 and Sections 7.10, 7.12, 7.13 and 7.14(b), nothing in this Agreement,
expressed or implied, is intended to confer on any person other than the parties
hereto or their respective heirs, successors, executors, administrators and
assigns any rights, remedies, obligations or liabilities under or by reason of
this Agreement.
A-52
<PAGE>
10.4 Entire Agreement. This Agreement, the Exhibits, the Tucker Disclosure
----------------
Letter and the Bradley Disclosure Letter and any documents delivered by the
parties in connection herewith constitute the entire agreement among the parties
with respect to the subject matter hereof and supersede all prior agreements and
understandings among the partes with respect thereto. No addition to or
modification of any provision of this Agreement shall be binding upon any party
hereto unless made in writing and signed by all parties hereto.
10.5 Confidentiality.
---------------
(a) As used herein, "Confidential Material" means, with respect to
either party hereto (the "Providing Party"), all information, whether oral,
written or otherwise, furnished to the other party hereto (the "Receiving
Party") or such Receiving Party's directors, officers, partners, Affiliates (as
defined in Rule 12b-2 under the Exchange Act), employees, agents or
representatives (collectively, "Representatives"), by the Providing Party and
all reports, analyses, compilations, studies and other material prepared by the
Receiving Party or its Representatives (in whatever form maintained, whether
documentary, computer storage or otherwise) containing, reflecting or based
upon, in whole or in part, any such information. The term "Confidential
Material" does not include information which (i) is or becomes generally
available, to the public other than as a result of a disclosure by the Receiving
Party, its Representatives or anyone to whom the Receiving Party or any of its
Representatives transmit any Confidential Material in violation of this
Agreement, (ii) is or becomes known or available to the Receiving Party on a
non-confidential basis from a source (other than the Providing Party or one of
its Representatives) who is not, to the knowledge of the Receiving Party after
reasonable inquiry, prohibited from transmitting the information to the
Receiving Party or its Representatives by a contractual, legal, fiduciary or
other obligation or (iii) is contained in the Form S-4.
(b) Subject to paragraph (c) below or except as required by law,
the Confidential Material will be kept confidential and will not, without the
prior written consent of the Providing Party, be disclosed by the Receiving
Party or its Representatives, in whole or in part, and will not be used by the
Receiving Party or its Representatives, directly or indirectly, for any purpose
other than in connection with this Agreement, the Merger or the evaluating,
negotiating or advising with respect to a transaction contemplated herein.
Moreover, each Receiving Party agrees to transmit Confidential Material to its
Representatives only if and to the extent that such Representatives need to know
the Confidential Material for purposes of such transaction and are informed by
such Receiving Party of the confidential nature of the Confidential Material and
of the terms of this Section. In any event, each Receiving Party will be
responsible for any actions by its Representatives which are not in accordance
with the provisions hereof.
(c) In the event that either Receiving Party, its Representatives
or anyone to whom such Receiving Party or its Representatives supply the
Confidential Material, are requested (by oral questions, interrogatories,
requests for information or documents, subpoena, civil investigative demand, any
informal or formal investigation by any government or governmental agency or
authority or otherwise in connection with legal process) to disclose any
Confidential Material, such Receiving Party agrees (i) to immediately notify the
Providing
A-53
<PAGE>
Party of the existence, terms and circumstances surrounding such a request, (ii)
to consult with the Providing Party on the advisability of taking legal
available steps to resist or narrow such request and (iii) if disclosure of such
information is required, to furnish only that portion of the Confidential
Material which, in the opinion of such Receiving Party's counsel, such Receiving
Party is legally compelled to disclose and to cooperate with any action by the
Providing Party to obtain an appropriate protective order or other reliable
assurance that confidential treatment will be accorded the Confidential Material
(it being agreed that the Providing Party shall, reimburse the Receiving Party
for all reasonable out-of-pocket expenses incurred by the Receiving Party in
connection with such cooperation).
(d) In the event of the termination of this Agreement in accordance
with its terms, promptly upon request from either Providing Party, the Receiving
Party shall, except to the extent prevented by law, redeliver to the Providing
Party or destroy all tangible Confidential Material and will not retain any
copies, extracts or other reproductions thereof in whole or in part. Any such
destruction shall be certified in writing to the Providing Party by an
authorized officer of the Receiving Party supervising the same. Notwithstanding
the foregoing, each Receiving Party and one Representative designated by each
Receiving Party shall be permitted to retain one permanent file copy of each
document constituting Confidential Material.
(e) Tucker and Bradley agree that prior to and within one year
after the termination of this Agreement they shall not solicit for employment,
whether as an employee or independent contractor, any person who is (or has been
within a period of one year) employed by the other, without the written consent
of the other.
10.6 Amendment. This Agreement may be amended by the parties hereto, by
---------
action taken by their respective Board of Directors, at any time before or after
approval of matters presented in connection with the Merger by the stockholders
of Tucker and Bradley, but after any such stockholder approval, no amendment
shall be made which by law requires the further approval of stockholders without
obtaining such further approval. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.
10.7 Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of Maryland without regard to its rules of
conflict of laws. Each of Tucker and Bradley hereby irrevocably and
unconditionally consents to submit to the exclusive jurisdiction of the courts
of the State of Maryland and of the United States of America located in the
State of Maryland (the "Maryland Courts") for any litigation arising out of or
relating to this Agreement and the transactions contemplated hereby (and agrees
not to commence any litigation relating thereto except in such courts), waives
any objection to the laying of venue of any such litigation in the Maryland
Courts and agrees not to plead or claim in any Maryland Court that such
litigation brought therein has been brought in any inconvenient forum.
10.8 Counterparts. This Agreement may be executed by the parties hereto in
------------
separate counterparts, each of which so executed and delivered shall be an
original, but all such counterparts shall together constitute one and the same
instrument. Each counterpart may
A-54
<PAGE>
consist of a number of copies hereof each signed by less than all, but together
signed by all of the parties hereto.
10.9 Headings. Headings of the Articles and Sections of this Agreement are
--------
for the convenience of the parties only, and shall be given no substantive or
interpretive effect whatsoever.
10.10 Interpretation. In this Agreement, unless the context otherwise
--------------
requires, words describing the singular number shall include the plural and vice
versa, and words denoting any gender shall include all genders and words
denoting natural persons shall include corporations and partnerships and vice
versa.
10.11 Waivers. Except as provided in this Agreement, no action taken
-------
pursuant to this Agreement, including, without limitation, any investigation by
or on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representations, warranties, covenants
or agreements contained in this Agreement. The waiver by any party hereto of a
breach of any provision hereunder shall not operate or be construed as a waiver
of any prior or subsequent breach of the same or any other provision hereunder.
10.12 Incorporation. The Tucker Disclosure Letter and the Bradley
-------------
Disclosure Letter and all Exhibits and Schedules attached hereto and thereto and
referred to herein and therein are hereby incorporated herein and made a part
hereof for all purposes as if fully set forth herein.
10.13 Severability. Any term or provision of this Agreement which is
------------
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable.
10.14 Enforcement of Agreement. The parties hereto agree that irreparable
------------------------
damage would occur in the event that any of the provisions of this Agreement was
not performed in accordance with its specific terms or was otherwise breached.
It is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions thereof in any Maryland Court, this being in addition
to any other remedy to which they are entitled at law or in equity.
10.15 Certain Definitions.
-------------------
(a) As used in this Agreement, the word "Subsidiary" or
"Subsidiaries" when used with respect to any party means any corporation,
partnership, joint venture, business trust or other entity, of which such party
directly or indirectly owns or controls at least a majority of the securities or
other interests having by their terms ordinary voting power
A-55
<PAGE>
to elect a majority of the board of directors or others performing similar
functions with respect to such corporation or other organization.
(b) As used in this Agreement, the word "person" means an
individual, a corporation, a partnership, an association, a joint-stock company,
a trust, a limited liability company, any unincorporated organization or any
other entity.
(c) As used in this Agreement, the word "affiliate" shall have the
meaning set forth in Rule 12b-2 of the Exchange Act.
10.16 Schedules. Any fact or item disclosed in one section of any
---------
Disclosure Letter or schedule hereto ("Schedule") shall be deemed to be
disclosed with respect to any other relevant section of such Disclosure Letter
or Schedule, whether or not an explicit cross-reference appears.
A-56
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement and caused the
same to be duly delivered on their behalf on the day and year first written
above.
BRADLEY REAL ESTATE, INC.
ATTEST:
By: /s/ WILLIAM B. KING By: /s/ E. LAWRENCE MILLER
----------------------------- -----------------------------------
Name: William B. King Name: E. Lawrence Miller
Title: Secretary Title: President and CEO
TUCKER PROPERTIES CORPORATION
ATTEST:
By: /s/ RICHARD H. TUCKER By: /s/ KENNETH L. TUCKER
----------------------------- -----------------------------------
Name: Richard H. Tucker Name: Kenneth L. Tucker
Title: Secretary Title: Chairman of the Board and
President
233728.c1
A-57
<PAGE>
ANNEX C
-------
October 30, 1995
Board of Directors
of Bradley Real Estate, Inc.
250 Boylston Street
Boston, Massachusetts 02116
Dear Sirs:
Bradley Real Estate, Inc. ("Bradley") and Tucker Properties Corporation
("Tucker") have entered into an Agreement and Plan of Merger dated as of October
30, 1995 (the "Agreement") pursuant to which Tucker will be merged with and into
Bradley in a transaction (the "Merger") in which each share of Tucker's common
stock, par value $.001 per share, will be converted into the right to receive
.665 shares (the "Exchange Ratio") of common stock of Bradley, par value $.01
per share, subject to certain adjustments as set forth in the Agreement. You
have requested our opinion as to whether the Exchange Ratio is fair, from a
financial point of view, to the stockholders of Bradley.
Alex. Brown & Sons Incorporated, as a customary part of its investment
banking business, is engaged in the valuation of businesses and their securities
in connection with mergers and acquisitions, negotiated underwritings, private
placements and valuations for estate, corporate and other purposes. We have
acted as financial advisor to the Board of Directors of Bradley in connection
with the transaction described above and will receive a fee for our services.
We have also acted as co-manager of a public offering of the common stock of
Bradley. Alex. Brown & Sons Incorporated regularly publishes research reports
regarding the real estate investment trust industry and the businesses and
securities of publicly owned companies in that industry. In the ordinary course
of business, we may actively trade the securities of both Bradley and Tucker for
our own account and the account of our customers and, accordingly, may at any
time hold a long or short position in securities of Bradley and Tucker.
<PAGE>
Board of Directors of
Bradley Real Estate, Inc.
October 30, 1995
Page Two
In connection with our opinion, we have reviewed certain publicly available
financial information concerning Tucker and certain internal financial analyses
and other information furnished to us by Bradley and Tucker. We have also held
discussions with members of the senior managements of Bradley and Tucker
regarding the business and prospects of Tucker. In addition, we have (i)
reviewed the reported price and trading activity for the common stock of Bradley
and Tucker, (ii) compared certain financial and stock market information for
Tucker with similar information for certain other companies whose securities are
publicly traded, (iii) reviewed the financial terms of certain recent business
combinations and (iv) performed such other studies and analyses and considered
such other factors as we deemed appropriate.
We have not independently verified the information described above and for
purposes of this opinion have assumed the accuracy, completeness and fairness
thereof. With respect to information relating to the prospects of Tucker, we
have assumed that such information reflects the best currently available
estimates and judgments of the managements of Bradley and Tucker as to the
likely future financial performance of Tucker. In addition, we have not made an
independent evaluation or appraisal of the assets of Tucker, nor have we been
furnished with any such evaluation or appraisal. Our opinion is based on
market, economic and other conditions as they exist and can be evaluated as of
the date of this letter.
Our advisory services and the opinion expressed herein are for the
information of the Board of Directors of Bradley and do not constitute a
recommendation to Bradley's stockholders as to how they should vote at the
stockholders' meeting in connection with the Merger. We hereby consent,
however, to the inclusion of this opinion as an exhibit to any proxy or
registration statement distributed in connection with the Merger.
Based upon and subject to the foregoing, it is our opinion that, as of the
date of this letter, the Exchange Ratio is fair, from a financial point of view,
to the stockholders of Bradley.
Very truly yours,
ALEX. BROWN & SONS INCORPORATED
<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Maryland General Corporation Law ("MGCL") permits a Maryland
corporation to include in its charter a provision limiting the liability of
its directors and officers to the corporation and its stockholders for money
damages except for liability resulting from (i) actual receipt of an improper
benefit or profit in money, property or services or (ii) active and deliberate
dishonesty established by a final judgment as being material to the cause of
action. The Articles of Amendment and Restatement (the "Bradley Charter") of
Bradley Real Estate, Inc. ("Bradley") contains such a provision which
eliminates such liability to the maximum extent permitted by Maryland law.
The Bradley Charter authorizes Bradley, to the maximum extent permitted
by Maryland law, to obligate itself to indemnify and to pay or reimburse
reasonable expenses in advance of final disposition of a proceeding to (i) any
present or former director, officer, agent, employee or plan administrator of
Bradley or of its predecessor Bradley Real Estate Trust (the "Trust") or (ii)
any individual who, at the request of Bradley, serves or has served in any of
these capacities with another corporation, partnership, joint venture, trust,
employee benefit plan or any other enterprise. The Bylaws of Bradley obligate
Bradley, to the maximum extent permitted by Maryland law, to indemnify (i) any
present or former director or officer of Bradley; (ii) any individual who, at
the request of Bradley, serves or has served another corporation, partnership,
joint venture, trust or other enterprise as a director or officer; or (iii)
any present or former trustee or officer of the Trust.
The MGCL requires a corporation (unless its charter provides otherwise,
which the Bradley Charter does not) to indemnify a director or officer who has
been successful, on the merits or otherwise, in the defense of any proceeding
to which he is made a party by reason of his service in that capacity. The
MGCL permits a corporation to indemnify its present and former directors and
officers, among others, against judgments, penalties, fines, settlements and
reasonable expenses actually incurred by them in connection with any
proceeding to which they may be made a party by reason of their service in
those or other capacities unless it is established that (a) the act or
omission of the director or officer was material to the matter giving rise to
the proceeding and (i) was committed in bad faith or (ii) was the result of
active and deliberate dishonesty; (b) the director or officer actually
received an improper personal benefit in money, property or services; or (c)
in the case of any criminal proceeding, the director or officer had reasonable
cause to believe that the act or omission was unlawful. However, a Maryland
corporation may not indemnify for an adverse judgment in a suit by or in the
right of the corporation. In addition, the MGCL requires a Maryland
corporation, as a condition to advancing expenses, to obtain (i) a written
affirmation by the director or officer of good faith belief that he has met
the standard of conduct necessary for indemnification by the corporation as
authorized by the corporation's bylaws and (ii) a written statement by or on
his behalf to repay the amount paid or reimbursed by the corporation if it
shall ultimately be determined that the standard of conduct was not met.
Bradley has a claims-made directors and officers liability insurance
policy that insures the directors and officers of Bradley against loss from
claimed wrongful acts and insures Bradley for indemnifying the directors and
officers against such loss. The policy limit of liability is $3,000,000 each
policy year and is subject to a retention of $150,000 of loss by Bradley.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(A) EXHIBITS
NUMBER DESCRIPTION
------ -----------
2.1 Agreement and Plan of Merger, dated as of October 30, 1995, between
Tucker Properties Corporation and Bradley Real Estate, Inc. (the
"Merger Agreement"), attached as Annex A to the Joint Proxy
Statement/Prospectus included in Part I of this Registration
Statement and incorporated herein by reference. The following
Exhibits to the Merger Agreement are included as separate Exhibits
to this Registration Statement: Form of Amended and Restated
Agreement of Limited Partnership of Bradley Operating Limited
Partnership (see Exhibit 10.1); Form of Affiliate Letter (see
Exhibit 10.3); Purchase and Sale of Securities Agreement (see
Exhibit 10.4); Tucker Properties Corporation Severance Pay Plan (see
Exhibit 10.5); Form of First Amendment to Indemnification Agreement
(see Exhibit 10.6); Severance Agreement with Kenneth Tucker (see
Exhibit 10.7); Severance Agreement
II-1
<PAGE>
with Richard Tucker (see Exhibit 10.8); Severance Agreement with
Harold Eisenberg (see Exhibit 10.9); Severance Agreement with Norris
Eber (see Exhibit 10.10); Severance Agreement with Lawrence Tucker
(see Exhibit 10.11); Severance Agreement with William Karnes (see
Exhibit 10.12); and Consulting Agreement with Kenneth Tucker (see
Exhibit 10.13). The other Exhibits to the Merger Agreement are not
included as Exhibits to this Registration Statement either because
they do not contain information that is material to an investment
decision or because they contain only information that is disclosed
in the Merger Agreement or this Registration Statement. A list
briefly identifying the contents of all omitted Exhibits is
incorporated by reference to page iv of the Merger Agreement.
Bradley agrees to furnish supplementally to the Commission, upon
request, a copy of any omitted Exhibit. Pursuant to Item 601(b)(2)
of Regulation S-K, the Schedules to the Merger Agreement are
omitted. Bradley hereby undertakes to furnish supplementally a copy
of any omitted Schedule to the Commission upon request.
3.1 Articles of Amendment and Restatement of Bradley Real Estate, Inc.,
incorporated by reference to Exhibit 3.1 of Bradley's Current Report
on Form 8-K dated October 17, 1994.
3.2 By-laws of Bradley Real Estate, Inc., incorporated by reference to
Exhibit 3.3 of Bradley's Current Report on Form 8-K dated October
17, 1994.
3.3 Articles of Amendment and Restatement of Tucker Properties
Corporation, incorporated by reference to Exhibit 3.01(b) of
Tucker's Registration Statement on Form S-11 (No. 33-64942) dated
October 4, 1993.
3.4 By-laws of Tucker Properties Corporation, incorporated by reference
to Exhibit 3.02 of Tucker's Registration Statement on Form S-11
dated October 4, 1993.
4.1 Specimen Certificate for shares of Common Stock, $.01 par value per
share, of Bradley Real Estate, Inc., incorporated by reference to
Exhibit 4.1 of Bradley's Registration Statement on Form S-4 (No. 33-
81888) dated July 22, 1994.
5.1 Form of Opinion of Goodwin, Procter & Hoar as to legality of the
securities being offered./**/
8.1 Form of Opinion of Goodwin, Procter & Hoar regarding tax
consequences of the merger./**/
8.2 Form of Opinion of Mayer, Brown & Platt regarding tax consequences
of the merger./**/
10.1 Form of Amended and Restated Agreement of Limited Partnership of
Bradley Operating Limited Partnership, incorporated by reference to
Exhibit 10.1 of Bradley's Current Report on Form 8-K dated November
3, 1995.
10.2 Form of Registration Rights Agreement between Bradley Real Estate,
Inc. and each of the limited partners to the Amended and Restated
Agreement of Limited Partnership of Bradley Operating Limited
Partnership./*/
10.3 Form of Affiliate Letter./*/
10.4 Purchase and Sale of Securities Agreement among Kenneth Tucker,
Richard Tucker, Marianne Dunn and Thomas P. D'Arcy./*/
10.5 Tucker Properties Corporation Severance Pay Plan, dated October 29,
1995, incorporated by reference to Exhibit 10.2 of Bradley's Current
Report on Form 8-K dated November 3, 1995.
10.6 Form of First Amendment to Indemnification Agreement./*/
10.7 Severance Agreement between Tucker Properties Corporation and
Kenneth Tucker, incorporated by reference to Exhibit 10.3 of
Bradley's Current Report on Form 8-K dated November 3, 1995.
10.8 Severance Agreement between Tucker Properties Corporation and
Richard Tucker, incorporated by reference to Exhibit 10.4 of
Bradley's Current Report on Form 8-K dated November 3, 1995.
II-2
<PAGE>
10.9 Severance Agreement between Tucker Properties Corporation and Harold
Eisenberg, incorporated by reference to Exhibit 10.5 of Bradley's
Current Report on Form 8-K dated November 3, 1995.
10.10 Severance Agreement between Tucker Properties Corporation and Norris
Eber, incorporated by reference to Exhibit 10.6 of Bradley's Current
Report on Form 8-K dated November 3, 1995.
10.11 Severance Agreement between Tucker Properties Corporation and
Lawrence Tucker, incorporated by reference to Exhibit 10.7 of
Bradley's Current Report on Form 8-K dated November 3, 1995.
10.12 Severance Agreement between Tucker Properties Corporation and
William Karnes, incorporated by reference to Exhibit 10.8 of
Bradley's Current Report on Form 8-K dated November 3, 1995.
10.13 Form of Consulting Agreement between Bradley Real Estate, Inc. and
Kenneth Tucker, incorporated by reference to Exhibit 10.9 of
Bradley's Current Report on Form 8-K dated November 3, 1995.
21.1 Subsidiaries of Bradley Real Estate, Inc./*/
23.1 Consent of KPMG Peat Marwick LLP./*/
23.2 Consent of Coopers & Lybrand L.L.P./*/
23.3 Consents of Goodwin, Procter & Hoar (included in Exhibits 5.1 and
8.1)./**/
23.4 Consent of Mayer, Brown & Platt (included in Exhibit 8.2)./**/
23.5 Consent of PaineWebber Incorporated./**/
23.6 Consent of Alex. Brown & Sons Incorporated./**/
24.1 Powers of Attorney (included in Part II of this Registration
Statement)./*/
99.1 Form of Bradley Real Estate, Inc. Proxy./*/
99.2 Form of Tucker Properties Corporation Proxy./*/
______________________
/*/ Filed herewith.
/**/ To be filed by amendment.
(B) FINANCIAL STATEMENT SCHEDULES
None.
(C) ITEM 4(B) INFORMATION
The opinions of PaineWebber Incorporated will be included, and the
opinion of Alex. Brown & Sons Incorporated is included, as Annex B and C,
respectively, to the Prospectus/Proxy Statement included in this Registration
Statement.
II-3
<PAGE>
ITEM 22. UNDERTAKINGS.
(a) The registrant hereby undertakes that, for purposes of determining
any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in
the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(b) The registrant hereby undertakes as follows: that prior to any
public reoffering of the securities registered hereunder through use
of a prospectus which is a part of this registration statement, by
any person or party who is deemed to be an underwriter within the
meaning of Rule 145(c), the issuer undertakes that such reoffering
prospectus will contain the information called for by the applicable
registration form with respect to reofferings by persons who may be
deemed underwriters, in addition to the information called for by
the other items of the applicable form.
(c) The registrant undertakes that every prospectus: (i) that is filed
pursuant to paragraph (b) immediately preceding, or (ii) that
purports to meet the requirements of Section 10(a)(3) of the Act and
is used in connection with an offering of securities subject to Rule
415, will be filed as a part of an amendment to the registration
statement and will not be used until such amendment is effective,
and that, for purposes of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or
paid by a director, officer, or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and
will be governed by the final adjudication of such issue.
(e) The registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the prospectus
pursuant to Item 4, 10(b), 11, or 13 of this form, within one
business day of receipt of such request, and to send the
incorporated documents by first class mail or other equally prompt
means. This includes information contained in documents filed
subsequent to the effective date of the registration statement
through the date of responding to the request.
(f) The registrant hereby undertakes to supply by means of post-
effective amendment all information concerning a transaction, and
the company being acquired involved therein, that was not the
subject of and included in the registration statement when it became
effective.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-4 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Boston, Commonwealth of
Massachusetts on the 7th day of December, 1995.
BRADLEY REAL ESTATE, INC.
By: /s/ E. LAWRENCE MILLER
--------------------------------
E. Lawrence Miller, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated, each of whom also constitutes and
appoints E. Lawrence Miller, Irving E. Lingo, Jr. and Thomas P. D'Arcy, and
each of them singly, his true and lawful attorney-in-fact and agent, for him,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments to
this Registration Statement and to file the same and all exhibits thereto, and
any other documents in connection therewith with the Securities and Exchange
Commission, granting unto each attorney-in-fact and agent full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that each attorney-in-
fact and agent or his substitute or substitutes may lawfully do or cause to be
done by virtue hereof.
<TABLE>
<CAPTION>
Name Title Date
---- ----- ----
<S> <C> <C>
/s/ E. Lawrence Miller President, Chief Executive Officer December 7, 1995
----------------------------
E. LAWRENCE MILLER and Director
/s/ Irving E. Lingo, Jr. Chief Financial Officer December 7, 1995
----------------------------
IRVING E. LINGO, JR.
/s/ William L. Brown Director December 7, 1995
----------------------------
WILLIAM L. BROWN
/s/ Joseph E. Hakim Director December 7, 1995
----------------------------
JOSEPH E. HAKIM
/s/ John B. Hynes III Director December 7, 1995
----------------------------
JOHN B. HYNES III
/s/ Stephen G. Kasnet Director December 7, 1995
----------------------------
STEPHEN G. KASNET
/s/ Paul G. Kirk, Jr. Director December 7, 1995
----------------------------
PAUL G. KIRK, JR.
/s/ W. Nicholas Thorndike Director December 7, 1995
----------------------------
W. NICHOLAS THORNDIKE
/s/ A. Robert Towbin Director December 7, 1995
----------------------------
A. ROBERT TOWBIN
</TABLE>
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
NUMBER DESCRIPTION PAGE
------ ----------- ----
<S> <C> <C>
2.1 Agreement and Plan of Merger, dated as of October 30, 1995, between
Tucker Properties Corporation and Bradley Real Estate, Inc. (the
"Merger Agreement"), attached as Annex A to the Joint Proxy
Statement/Prospectus included in Part I of this Registration
Statement and incorporated herein by reference. The following
Exhibits to the Merger Agreement are included as separate Exhibits
to this Registration Statement: Form of Amended and Restated
Agreement of Limited Partnership of Bradley Operating Limited
Partnership (see Exhibit 10.1); Form of Affiliate Letter (see
Exhibit 10.3); Purchase and Sale of Securities Agreement (see
Exhibit 10.4); Tucker Properties Corporation Severance Pay Plan (see
Exhibit 10.5); Form of First Amendment to Indemnification Agreement
(see Exhibit 10.6); Severance Agreement with Kenneth Tucker (see
Exhibit 10.7); Severance Agreement
</TABLE>
<PAGE>
with Richard Tucker (see Exhibit 10.8); Severance Agreement with
Harold Eisenberg (see Exhibit 10.9); Severance Agreement with Norris
Eber (see Exhibit 10.10); Severance Agreement with Lawrence Tucker
(see Exhibit 10.11); Severance Agreement with William Karnes (see
Exhibit 10.12); and Consulting Agreement with Kenneth Tucker (see
Exhibit 10.13). The other Exhibits to the Merger Agreement are not
included as Exhibits to this Registration Statement either because
they do not contain information that is material to an investment
decision or because they contain only information that is disclosed
in the Merger Agreement or this Registration Statement. A list
briefly identifying the contents of all omitted Exhibits is
incorporated by reference to page iv of the Merger Agreement.
Bradley agrees to furnish supplementally to the Commission, upon
request, a copy of any omitted Exhibit. Pursuant to Item 601(b)(2)
of Regulation S-K, the Schedules to the Merger Agreement are
omitted. Bradley hereby undertakes to furnish supplementally a copy
of any omitted Schedule to the Commission upon request.
3.1 Articles of Amendment and Restatement of Bradley Real Estate, Inc.,
incorporated by reference to Exhibit 3.1 of Bradley's Current Report
on Form 8-K dated October 17, 1994.
3.2 By-laws of Bradley Real Estate, Inc., incorporated by reference to
Exhibit 3.3 of Bradley's Current Report on Form 8-K dated October
17, 1994.
3.3 Articles of Amendment and Restatement of Tucker Properties
Corporation, incorporated by reference to Exhibit 3.01(b) of
Tucker's Registration Statement on Form S-11 (No. 33-64942) dated
October 4, 1993.
3.4 By-laws of Tucker Properties Corporation, incorporated by reference
to Exhibit 3.02 of Tucker's Registration Statement on Form S-11
dated October 4, 1993.
4.1 Specimen Certificate for shares of Common Stock, $.01 par value per
share, of Bradley Real Estate, Inc., incorporated by reference to
Exhibit 4.1 of Bradley's Registration Statement on Form S-4 (No. 33-
81888) dated July 22, 1994.
5.1 Form of Opinion of Goodwin, Procter & Hoar as to legality of the
securities being offered./**/
8.1 Form of Opinion of Goodwin, Procter & Hoar regarding tax
consequences of the merger./**/
8.2 Form of Opinion of Mayer, Brown & Platt regarding tax consequences
of the merger./**/
10.1 Form of Amended and Restated Agreement of Limited Partnership of
Bradley Operating Limited Partnership, incorporated by reference to
Exhibit 10.1 of Bradley's Current Report on Form 8-K dated November
3, 1995.
10.2 Form of Registration Rights Agreement between Bradley Real Estate,
Inc. and each of the limited partners to the Amended and Restated
Agreement of Limited Partnership of Bradley Operating Limited
Partnership./*/
10.3 Form of Affiliate Letter./*/
10.4 Purchase and Sale of Securities Agreement among Kenneth Tucker,
Richard Tucker, Marianne Dunn and Thomas P. D'Arcy./*/
10.5 Tucker Properties Corporation Severance Pay Plan, dated October 29,
1995, incorporated by reference to Exhibit 10.2 of Bradley's Current
Report on Form 8-K dated November 3, 1995.
10.6 Form of First Amendment to Indemnification Agreement./*/
10.7 Severance Agreement between Tucker Properties Corporation and
Kenneth Tucker, incorporated by reference to Exhibit 10.3 of
Bradley's Current Report on Form 8-K dated November 3, 1995.
10.8 Severance Agreement between Tucker Properties Corporation and
Richard Tucker, incorporated by reference to Exhibit 10.4 of
Bradley's Current Report on Form 8-K dated November 3, 1995.
<PAGE>
10.9 Severance Agreement between Tucker Properties Corporation and Harold
Eisenberg, incorporated by reference to Exhibit 10.5 of Bradley's
Current Report on Form 8-K dated November 3, 1995.
10.10 Severance Agreement between Tucker Properties Corporation and Norris
Eber, incorporated by reference to Exhibit 10.6 of Bradley's Current
Report on Form 8-K dated November 3, 1995.
10.11 Severance Agreement between Tucker Properties Corporation and
Lawrence Tucker, incorporated by reference to Exhibit 10.7 of
Bradley's Current Report on Form 8-K dated November 3, 1995.
10.12 Severance Agreement between Tucker Properties Corporation and
William Karnes, incorporated by reference to Exhibit 10.8 of
Bradley's Current Report on Form 8-K dated November 3, 1995.
10.13 Form of Consulting Agreement between Bradley Real Estate, Inc. and
Kenneth Tucker, incorporated by reference to Exhibit 10.9 of
Bradley's Current Report on Form 8-K dated November 3, 1995.
21.1 Subsidiaries of Bradley Real Estate, Inc./*/
23.1 Consent of KPMG Peat Marwick LLP./*/
23.2 Consent of Coopers & Lybrand L.L.P./*/
23.3 Consents of Goodwin, Procter & Hoar (included in Exhibits 5.1 and
8.1)./**/
23.4 Consent of Mayer, Brown & Platt (included in Exhibit 8.2)./**/
23.5 Consent of PaineWebber Incorporated./**/
23.6 Consent of Alex. Brown & Sons Incorporated./**/
24.1 Powers of Attorney (included in Part II of this Registration
Statement)./*/
99.1 Form of Bradley Real Estate, Inc. Proxy./*/
99.2 Form of Tucker Properties Corporation Proxy./*/
______________________
/*/ Filed herewith.
/**/ To be filed by amendment.
<PAGE>
EXHIBIT 10.2
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is entered into as of
__________, 1996 by and between Bradley Real Estate, Inc., a Maryland
corporation (the "Company"), and each of the parties executing a signature page
hereto (individually, a "Holder" and collectively, the "Holders").
WHEREAS, the Holders have received units ("Units") of limited partnership
interest in Bradley Operating Limited Partnership, a Delaware limited
partnership (the "Operating Partnership") in connection with the merger of
Tucker Properties Corporation with and into the Company; and
WHEREAS, under the Operating Partnership's Amended and Restated Agreement
of Limited Partnership dated as of ___________________, 1996 (the "Partnership
Agreement"), the Holders' Units may be presented for redemption to the Operating
Partnership, and any Units so presented may be redeemed for cash, or at the
option of the Company, for an equivalent number of shares ("Shares") of the
Company's common stock, $.01 par value per share ("Common Stock"); and
WHEREAS, in order to induce the Holders to enter into the Partnership
Agreement, the Company has agreed to provide for the benefit of the Holders the
registration rights set forth in this Agreement with respect to such Holders'
Shares, subject to the terms and conditions provided herein.
NOW, THEREFORE, in consideration of the foregoing, the mutual premises and
agreements set forth herein, and other valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Certain Definitions.
-------------------
As used in this Agreement, the following capitalized terms not elsewhere
defined shall have the following meanings:
"Prospectus" shall mean the prospectus included in a Registration
----------
Statement, as amended or supplemented, including any preliminary prospectus,
prospectus supplement and post-effective amendment, and in each case including
all material incorporated by reference therein.
"Registrable Shares" shall mean the Shares, excluding (i) Shares for which
------------------
a Registration Statement relating to the sale thereof shall have become
effective under the Securities Act of 1933, as amended (the "Securities Act"),
and which shall have been disposed of under such Registration Statement, (ii)
Shares sold pursuant to Rule 144 under the
<PAGE>
Securities Act and (iii) Shares eligible for sale pursuant to Rule 144(k) under
the Securities Act. "Registrable Shares" shall include Units eligible to be
redeemed in exchange for Shares.
"Registration Statement" shall mean any registration statement of the
----------------------
Company, and any other entity required to be a registrant with respect to such
registration statement pursuant to the requirements of the Securities Act, which
statement covers any of the Registrable Shares on an appropriate form,
including, without limitation, any Demand Registration Statement and all
amendments and supplements to such registration statement, including post-
effective amendments, in each case including the Prospectus contained therein,
all exhibits thereto and all materials incorporated by reference therein.
2. Registration.
------------
(a) Demand Registration.
-------------------
(i) On any two (2) occasions after the date hereof, the
Company shall, at the written request of any Holder of Registrable Shares,
cause to be filed a registration statement (a "Demand Registration
Statement") under the Securities Act relating to the sale by the Holder of
all or part of such Holder's Registrable Shares; provided, however, that
-------- -------
the Company shall have no obligation pursuant to this Section 2(a)(i)
unless the conditions set forth in Section 2(a)(ii), and elsewhere in this
Agreement, are satisfied. Upon the Company's determination that such
conditions have been satisfied, the Company shall give written notice of
the proposed registration to all Holders of Registrable Shares. Subject to
the conditions set forth below, each such Holder shall have the right, by
giving written notice to the Company, within fifteen (15) days after the
notice referred to in the preceding sentence has been given by the Company,
to elect to have included in the Demand Registration Statement all or part
of such Holder's Registrable Shares. Thereupon, the Company shall use
commercially reasonable efforts to cause such Demand Registration Statement
to be filed with, and be declared effective by, the Securities and Exchange
Commission (the "SEC") and shall use commercially reasonable efforts to
cause the Registrable Shares elected to be included in the Demand
Registration Statement to be registered under the Securities Act.
Notwithstanding the foregoing, the Company shall be entitled to postpone
the filing of any Demand Registration Statement otherwise required to be
prepared and filed by it pursuant to this Section 2(a)(i) for a reasonable
period of time (but in no event longer than ninety (90) days) if, at the
time it receives a request for registration, the Board of Directors of the
Company has determined in good faith that such filing would require the
disclosure of a material pending transaction or event and that such
disclosure would have a material adverse effect on the Company; provided
that the right to postpone the filing of any
2
<PAGE>
Demand Registration Statement may only be exercised once in any twelve (12)
month period.
(ii) The Company shall have no obligation under Section 2(a)(i)
unless the following conditions are satisfied:
(A) Any Holder who requests that the Company cause to be
filed a Demand Registration Statement pursuant to Section 2(a)(i)
must provide to the Company a certificate (the "Authorizing
Certificate"), substantially in the form of Exhibit A hereto,
---------
that is signed by the Holders of at least twenty-five
percent (25%) of the aggregate number of all outstanding
Registrable Shares, at the time such request is made. The
Authorizing Certificate shall set forth (i) the name of each
Holder signing such Authorizing Certificate, (ii) the number of
Registrable Shares held by each such Holder, and, if different,
the number of Registrable Shares such Holder has elected to have
registered, and (iii) a certification from each such Holder that
it is requesting the registration of only those shares of Common
Stock received by such Holder upon the redemption of its Units
pursuant to the Partnership Agreement. Any Holder whose
Registrable Shares have become eligible for sale pursuant to Rule
144(k) promulgated under the Securities Act shall not be included
for purposes of calculating the percentage of Holders required to
sign an Authorizing Certificate. If the Company determines that a
Holder's Shares have become eligible for sale pursuant to Rule
144(k), the Company shall, at the request of such Holder, deliver
to such Holder an opinion of counsel to such effect.
(B) A Holder may only request that the Company register
those Registrable Shares of Common Stock received by such Holder
from the Company upon the redemption of some or all of such
Holder's Units.
(C) The Company shall be obligated to file only one
Demand Shelf Registration Statement during any twelve (12) month
period during which no Registration Statement has been in effect.
(b) Piggyback Registration. If at any time after the date hereof, while
----------------------
any Registrable Shares are outstanding and no Demand Registration Statement is
in effect, the Company (without any obligation to do so) proposes to file a
registration statement under the Securities Act with respect to an offering of
Common Stock solely for cash (other than a registration statement (i) on Form S-
8 or any successor form to such Form or in connection with any employee or
director welfare, benefit or compensation plan, (ii) on Form S-4 or any
3
<PAGE>
successor form to such Form or in connection with an exchange offer, (iii) in
connection with a rights offering or a dividend reinvestment and share purchase
plan offered exclusively to existing holders of Common Stock, (iv) in connection
with an offering solely to employees of the Company or its affiliates, or (v)
relating to a transaction pursuant to Rule 145 of the Securities Act), whether
or not for its own account, the Company shall give prompt written notice of such
proposed filing to the Holders. The notice referred to in the preceding
sentence shall offer each Holder the opportunity to register such amount of its
Registrable Shares of Common Stock received from the Company upon the redemption
of some or all of its Units, as such Holder may request (a "Piggyback
Registration"). Subject to the provisions of Section 3 below, the Company shall
include the Registrable Shares for which the Company has received written
requests for inclusion in such Piggyback Registration, in the registration and
qualification for sale under the securities or "Blue Sky" laws of the various
states and in any underwriting in connection therewith. Such written
notification shall be provided by the Holder to the Company within fifteen (15)
calendar days after the notice referred to above has been given by the Company
to such Holder. A Holder of Registrable Shares shall be permitted to withdraw
all or part of such Holder's Registrable Shares from a Piggyback Registration at
any time prior to the effective date of such Piggyback Registration. If a
Piggyback Registration is an underwritten primary registration on behalf of the
Company and the managing underwriter advises the Company that the total number
of shares of Common Stock requested to be included in such registration exceeds
the number of shares of Common Stock which can reasonably be sold in such
offering, the Company will include in such registration in the following
priority: (i) first, all shares of Common Stock the Company proposes to sell
and (ii) second, up to the full number of applicable Registrable Shares
requested to be included in such registration which, in the opinion of such
managing underwriter, can be sold without adversely affecting the price range or
probability of success of such offering, which shall be allocated among the
Holders requesting registration and any other person who has been given
"piggyback" registration rights on a pro rata basis.
(c) The Company shall notify each Holder of the effectiveness of any
Registration Statement and shall furnish to each Holder such number of copies of
the Registration Statement (including any amendments, supplements and exhibits),
the Prospectus contained therein (including each preliminary prospectus and all
related amendments and supplements) and any documents incorporated by reference
in the Registration Statement or such other documents as each Holder may
reasonably request in order to facilitate its sale of the Registrable Shares in
the manner described in the Registration Statement.
(d) The Company shall prepare and file with the SEC from time to time such
amendments and supplements to any Registration Statement and Prospectus used in
connection therewith as may be necessary to keep such Registration Statement
effective and to comply with the provisions of the Securities Act with respect
to the sale of securities covered by such Registration Statement for the period
necessary to complete the proposed public offering. Upon five (5) business days'
notice, the Company shall file any supplement or post-effective amendment to any
Registration Statement with respect to the plan of distribution or such
4
<PAGE>
Holder's ownership interests in Registrable Shares that is reasonably necessary
to permit the sale of the Holder's Registrable Shares pursuant to such
Registration Statement. The Company shall file any necessary listing
applications or amendments to the existing applications to cause the Shares
registered under any Registration Statement to be then listed or quoted on the
primary exchange or quotation system on which the shares of Common Stock are
then listed or quoted.
(e) The Company shall promptly notify each Holder of, and confirm in
writing, any request by the SEC for amendments or supplements to any
Registration Statement or the Prospectus related thereto or for additional
information. In addition, the Company shall promptly notify each Holder of, and
confirm in writing, the filing of any Registration Statement or any Prospectus,
amendment or supplement related thereto or any post-effective amendment to such
Registration Statement and the effectiveness of any post-effective amendment.
(f) At any time when a Prospectus relating to any Registration Statement
is required to be delivered under the Securities Act, the Company shall
immediately notify each Holder of the happening of any event as a result of
which the Prospectus included in the Registration Statement, as then in effect,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading. In
such event, the Company shall promptly prepare and furnish to each Holder a
reasonable number of copies of a supplement to or an amendment of such
Prospectus as may be necessary so that, as thereafter delivered to the
purchasers of Registrable Shares, such Prospectus shall not include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they are made, not misleading. The Company will, if
necessary, amend the Registration Statement of which such Prospectus is a part
to reflect such amendment or supplement.
3. State Securities Laws. Subject to the conditions set forth in this
---------------------
Agreement, the Company shall, in connection with the filing of any Registration
Statement hereunder, file such documents as may be necessary to register or
qualify the Registrable Shares under the securities or "Blue Sky" laws of such
states as any Holder may reasonably request, and the Company shall use
commercially reasonable efforts to cause such filings to become effective;
provided, however, that the Company shall not be obligated to qualify as a
- -------- -------
foreign corporation to do business under the laws of any such state in which it
is not then qualified or to file any general consent to service of process in
any such state. Once effective, the Company shall use commercially reasonable
efforts to keep such filings effective until the earlier of (a) such time as all
of the Registrable Shares have been disposed of in accordance with the intended
methods of disposition by the Holder as set forth in the Registration Statement,
(b) in the case of a particular state, a Holder has notified the Company that it
no longer requires an effective filing in such state in accordance with its
original request for filing, or (c) the date on which the
5
<PAGE>
Registration Statement ceases to be effective with the SEC. The Company shall
promptly notify each Holder of, and confirm in writing, the receipt by the
Company of any notification with respect to the suspension of the qualification
of the Registrable Shares for sale under the securities or "Blue Sky" laws of
any jurisdiction or the initiation or threat of any proceeding for such purpose.
4. Expenses. Except as provided herein, the Company shall bear all
--------
expenses incurred in connection with the registration of Registrable Shares
pursuant to Sections 2(a) and 2(b) of this Agreement. The Holders shall be
responsible for any brokerage or underwriting commissions and taxes of any kind
(including, without limitation, transfer taxes) with respect to any disposition,
sale or transfer of Registrable Shares and for any legal, accounting and other
expenses incurred by them.
5. Indemnification by the Company. The Company agrees to indemnify each
------------------------------
of the Holders and their respective officers, directors, employees, agents,
representatives and affiliates, and each person or entity, if any, that controls
a Holder within the meaning of the Securities Act, and each other person or
entity, if any, subject to liability because of his, her or its connection with
a Holder, and any underwriter and any person who controls such underwriter
within the meaning of the Securities Act (each an "Indemnitee") against any and
all losses, claims, damages, actions, liabilities, costs and expenses (including
without limitation reasonable fees, expenses and disbursements of attorneys and
other professionals documented in writing), joint or several, arising out of or
based upon any violation by the Company of any rule or regulation promulgated
under the Securities Act applicable to the Company and relating to any action or
inaction required of the Company in connection with any Registration Statement
or Prospectus, or upon any untrue or alleged untrue statement of material fact
contained in any Registration Statement or any Prospectus, or any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, provided, that the Company shall not be
--------
liable to such Indemnitee or any person who participates as an underwriter in
the offering or sale of Registrable Shares or any other person, if any, who
controls such underwriter within the meaning of the Securities Act, in any such
case to the extent that any such loss, claim, damage, liability (or action or
proceeding in respect thereof) or expense arises out of or is based upon (a) an
untrue statement or alleged untrue statement or omission or alleged omission
made in such Registration Statement, any such preliminary prospectus, final
prospectus, summary prospectus, amendment or supplement in reliance upon and in
conformity with information regarding such Indemnitee or its plan of
distribution or ownership interests which was furnished to the Company for use
in connection with the Registration Statement or the Prospectus contained
therein by such Indemnitee, or (b) such Indemnitee's failure to send or give a
copy of the final prospectus furnished to it by the Company through no fault of
the Company at or prior to the time such action is required by the Securities
Act to the person claiming an untrue statement or alleged untrue statement or
omission or alleged omission if such statement or omission was corrected in such
final prospectus.
6
<PAGE>
6. Covenants of Holders. Each of the Holders hereby agrees (a) to
--------------------
cooperate with the Company and to furnish to the Company all such information
concerning its plan of distribution and ownership interests with respect to its
Registrable Shares in connection with the preparation of any Registration
Statement and any filings with any state securities commissions as the Company
may reasonably request, (b) to the extent required by the Securities Act, to
deliver or cause delivery of the Prospectus contained in any Registration
Statement to any purchaser of the shares covered by such Registration Statement
from the Holder, and (c) to indemnify the Company, its officers, directors,
employees, agents, representatives and affiliates, and each person or entity, if
any, who controls the Company within the meaning of the Securities Act, and each
other person or entity, if any, subject to liability because of his, her or its
connection with the Company, against any and all losses, claims, damages,
actions, liabilities, costs and expenses arising out of or based upon (i) any
untrue statement or alleged untrue statement of material fact contained in
either a Registration Statement or the Prospectus contained therein, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, if and to the extent
that such statement or omission occurs from reliance upon and in conformity with
information regarding the Holder, its plan of distribution or its ownership
interests, which was furnished in writing to the Company by the Holder for use
therein unless such statement or omission was corrected in writing to the
Company not less than two (2) business days prior to the date of the final
prospectus (as supplemented or amended, as the case may be), or (ii) the failure
by the Holder to deliver or cause to be delivered the Prospectus contained in
any Registration Statement (as amended or supplemented, if applicable) furnished
by the Company to the Holder to any purchaser of the shares covered by such
Registration Statement from the Holder through no fault of the Company.
7. Suspension of Registration Requirement.
--------------------------------------
(a) The Company shall promptly notify each Holder of, and confirm in
writing, the issuance by the SEC of any stop order suspending the effectiveness
of a Registration Statement or the initiation of any proceedings for that
purpose. The Company shall use commercially reasonable efforts to obtain the
withdrawal of any order suspending the effectiveness of such Registration
Statement at the earliest possible moment.
(b) Notwithstanding anything to the contrary set forth in this Agreement,
the Company's obligation under this Agreement to use commercially reasonable
efforts to cause a Registration Statement and any filings with any state
securities commission to become effective or to amend or supplement a
Registration Statement shall be suspended in the event and during such period as
the Company is proceeding with (i) an underwritten primary offering by the
Company if the Company is advised by the underwriters that the sale of
Registrable Shares under a Registration Statement would have a material adverse
effect on the primary offering, or (ii) pending negotiations relating to, or
consummation of, a transaction or the occurrence of an event that would require
additional disclosure of material information by the Company in a
7
<PAGE>
Registration Statement or such filing, as to which the Company has a bona fide
---- ----
business purpose for preserving confidentiality or which renders the Company
unable to comply with SEC requirements as determined by its Board of Directors
(such circumstances being hereinafter referred to as a "Suspension Event") that
would make it impractical or unadvisable to cause a Registration Statement or
such filings to become effective or to amend or supplement such Registration
Statement, but such suspension shall continue only for so long as such event or
its effect is continuing but in no event will that suspension exceed ninety (90)
days. The Company shall notify each Holder of the existence and, in the case of
circumstances referred to in clause (i) of this Section 7(b), the nature of any
Suspension Event.
(c) Each Holder of Registrable Shares whose Registrable Shares are covered
by a Registration Statement filed pursuant to Section 2 hereof agrees, if
requested by the Company in the case of a Company-initiated nonunderwritten
offering or if requested by the managing underwriter or underwriters in a
Company-initiated underwritten offering, not to effect any public sale or
distribution of any of the securities of the Company of any class included in
such Registration Statement, including a sale pursuant to Rule 144 or Rule 144A
under the Securities Act (except as part of such Company-initiated
registration), during the 15-day period prior to, and during the 60-day period
beginning on, the date of effectiveness of each Company-initiated offering made
pursuant to such Registration Statement, to the extent timely notified in
writing by the Company or the managing underwriters; provided, however, that
-------- -------
such 60-day period shall be extended by the number of days from and including
the date of the giving of any notice pursuant to Section 2(e) or (f) hereof to
and including the date when each seller of Registrable Shares covered by such
Registration Statement shall have received the copies of the supplemented or
amended Prospectus contemplated by Section 2(f) hereof.
8. Black-Out Period. Following the effectiveness of a Registration
----------------
Statement and the filings with any state securities commissions, the Holders
agree that they will not effect any sales of Registrable Shares pursuant to such
Registration Statement or any such filings at any time after they have received
notice from the Company to suspend sales as a result of the occurrence or
existence of any Suspension Event so that the Company may correct or update the
Registration Statement or such filing. The Holders may recommence effecting
sales of the Shares pursuant to the Registration Statement or such filings
following further notice to such effect from the Company, which notice shall be
given by the Company not later than five (5) business days after the conclusion
of any such Suspension Event.
9. Additional Shares. The Company, at its option, may register,
-----------------
under any Registration Statement and any filings with any state securities
commissions filed pursuant to this Agreement, any number of unissued shares of
Common Stock of the Company or any Common Stock of the Company owned by any
other shareholders of the Company.
10. Contribution. If the indemnification provided for in Sections 5
------------
and 6 is unavailable to an indemnified party with respect to any losses, claims,
damages, actions, liabilities, costs or expenses referred to therein or is
insufficient to hold the indemnified party
8
<PAGE>
harmless as contemplated therein, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
actions, liabilities, costs or expenses in such proportion as is appropriate to
reflect the relative fault of the Company, on the one hand, and the Indemnitee,
on the other hand, in connection with the statements or omissions which resulted
in such losses, claims, damages, actions, liabilities, costs or expenses as well
as any other relevant equitable considerations. The relative fault of the
Company, on the one hand, and of the Indemnitee, on the other hand, shall be
determined by reference to, among other factors, whether the untrue or alleged
untrue statement of a material fact or omission to state a material fact relates
to information supplied by the Company or by the Indemnitee and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission; provided, however, that in no event shall
-------- -------
the obligation of any indemnifying party to contribute under this Section 10
exceed the amount that such indemnifying party would have been obligated to pay
by way of indemnification if the indemnification provided for under Sections 5
or 6 hereof had been available under the circumstances.
The Company and the Holders agree that it would not be just and equitable
if contribution pursuant to this Section 10 were determined by pro rata
--- ----
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 10, no Holder shall be
required to contribute any amount in excess of the amount by which the gross
proceeds from the sale of Shares exceeds the amount of any damages that such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission. No indemnified party guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any indemnifying party who was not guilty
of such fraudulent misrepresentation.
11. No Other Obligation to Register. Except as otherwise expressly
-------------------------------
provided in this Agreement, the Company shall have no obligation to the Holders
to register the Registrable Shares under the Securities Act.
12. Rule 144 Covenants. With a view to making available the benefits
------------------
of certain rules and regulations of the SEC, including without limitation Rule
144, that may permit the sale of restricted securities to the public without
registration, the Company agrees to use its best efforts to:
(a) Make available and keep public, at all times, current public
information regarding the Company as those terms are understood and defined in
Rule 144 under the Securities Act.
9
<PAGE>
(b) File with the SEC in a timely manner all reports and other documents
required of the Company under the Securities Act and the Securities Exchange Act
of 1934, as amended (the "Exchange Act").
(c) So long as a Holder owns any Registrable Shares, furnish to the Holder
forthwith upon written request a written statement by the Company as to its
compliance with the reporting requirements of Rule 144, and of the Securities
Act and the Exchange Act, a copy of the most recent annual or quarterly report
of the Company, and such other reports and documents so filed as a Holder may
reasonably request in availing itself of any rule or regulation of the SEC
allowing a Holder to sell any such securities without registration.
13. Amendments and Waivers. The provisions of this Agreement may not
----------------------
be amended, modified, or supplemented or waived without the prior written
consent of the Company and the Holders holding in excess of fifty percent (50%)
of the aggregate number of all Registrable Shares.
14. Notices. Except as set forth below, all notices and other
-------
communications provided for or permitted hereunder shall be in writing and shall
be deemed to have been duly given if delivered personally or sent by telex or
telecopier, registered or certified mail (return receipt requested), postage
prepaid or courier or overnight delivery service to the respective parties at
the following addresses (or at such other address for any party as shall be
specified by like notice, provided that notices of a change of address shall be
effective only upon receipt thereof), and further provided that in case of
directions to amend the Registration Statement pursuant to Section 2(d) or
Section 6, a Holder must confirm such notice in writing by overnight express
delivery with confirmation of receipt:
If to the Company: Bradley Real Estate, Inc.
250 Boylston Street
Boston, MA 02116
Attn: E. Lawrence Miller, President
Telecopy: (617) 266-9453
Telephone: (617) 421-0680
With a copy to:
William B. King, P.C.
Goodwin, Procter & Hoar
Exchange Place
Boston, MA 02109
Telecopy: (617) 523-1231
Telephone: (617) 570-1530
If to the Holders: As listed on the applicable Holder Signature Page
10
<PAGE>
In addition to the manner of notice permitted above, notices given pursuant to
Sections 2, 7 and 8 hereof may be effected telephonically and confirmed in
writing thereafter in the manner described above.
15. Successors and Assigns. This Agreement shall be binding upon and
----------------------
inure to the benefit of the successors and assigns of the Company. This
Agreement may not be assigned by any Holder and any attempted assignment hereof
by any Holder will be void and of no effect and shall terminate all obligations
of the Company hereunder, provided that any Holder may assign its rights
-------- ----
hereunder to any individual, partnership, corporation, trust or other legal
entity to whom such Holder has transferred any of its Units or Shares. If any
transferee of any Holder shall acquire Registrable Shares in any manner, whether
by operation of law or otherwise, such Registrable Shares shall be held subject
to all of the terms of this Agreement, and by taking and holding such
Registrable Shares such transferee shall be conclusively deemed to have agreed
to be bound by and to perform all of the terms and provisions of this Agreement
and such person shall be entitled to receive the benefits hereof.
16. Counterparts. This Agreement may be executed in any number of
------------
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
17. Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the laws of the State of Maryland applicable to contracts
made and to be performed wholly within said State.
18. Severability. In the event that any one or more of the
------------
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be in any way
impaired thereby, it being intended that all of the rights and privileges of the
parties hereto shall be enforceable to the fullest extent permitted by law.
19. Entire Agreement. This Agreement is intended by the parties as a
----------------
final expression of their agreement and intended to be the complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein, with respect to such subject matter. This Agreement supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
[Remainder of Page Intentionally Left Blank]
11
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
BRADLEY REAL ESTATE, INC.
By:
____________________________
Name:
Title:
12
<PAGE>
REGISTRATION RIGHTS AGREEMENT
HOLDER SIGNATURE PAGE
Holder:
____________________________________
Print Name:
Address for Notice:
------------------
________________________________________
________________________________________
________________________________________
________________________________________
Copy to:
13
<PAGE>
EXHIBIT A
[Date]
FORM OF AUTHORIZING CERTIFICATE
Each of the undersigned Holders, together holding at least twenty-five
percent (25%) of the aggregate number of all of the Holders' Registrable Shares,
hereby certifies that:
1. Such Holder's name is set forth below, and the number of Registrable
Shares held by such Holder and the number of Registrable Shares, if
different, such Holder would like to have registered is set forth
opposite such Holder's name.
Number of Number of Registrable
Name Registrable Shares Shares Desired to be Registered
---- ------------------ -------------------------------
2. Such Holder is requesting the registration of only those shares of
Common Stock received by such Holder upon the redemption of its Units
pursuant to the Partnership Agreement.
EXECUTED as of the date set forth above.
[Signatures of Holders]
14
<PAGE>
EXHIBIT 10.3
FORM OF AFFILIATE LETTER
Bradley Real Estate, Inc.
250 Boylston Street
Boston, Massachusetts 02116
Ladies and Gentlemen:
I have been advised that as of the date of this letter I may be deemed to
be an "affiliate" of Tucker Properties Corporation, a Maryland corporation
("Tucker"), as the term "affiliate" is (i) defined for purposes of paragraphs
(c) and (d) of Rule 145 of the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission") under
the Securities Act of 1933, as amended (the "Act"), or (ii) used in and for
purposes of Accounting Series, Releases 130 and 135, as amended, of the
Commission. Pursuant to the terms of the Agreement and Plan of Merger dated as
of October __, 1995 (the "Agreement"), between Tucker and Bradley Real Estate,
Inc., a Maryland corporation ("Bradley"), Tucker will be merged with and into
Bradley.
As a result of the Merger, I may receive shares of Common Stock, par value
$.01 per share, of Bradley (the "Bradley Securities") in exchange for shares
owned by me of Common Stock, par value $.001 per share, of Tucker.
I represent, warrant and covenant to Bradley that in the event I receive
any Bradley Securities as a result of the Merger:
A. I shall not make any sale, transfer or other disposition of the
Bradley Securities in violation of the Act or the Rules and Regulations.
B. I have carefully read this letter and the Agreement and discussed the
requirements of such documents and other applicable limitations upon my ability
to sell, transfer or otherwise dispose of the Bradley Securities to the extent I
felt necessary, with my counsel or counsel for Tucker.
C. I have been advised that the issuance of Bradley Securities to me
pursuant to the Merger has been registered with the Commission under the Act on
a Registration Statement on Form S-4. However, I have also been advised that,
since at the time the Merger was submitted for a vote of the stockholders of
Tucker, I may be deemed to have been an affiliate of Tucker and the distribution
by me of the Bradley Securities has not been registered under the Act, I may not
sell, transfer or otherwise dispose of the Bradley Securities issued to me in
the Merger unless (i) such sale, transfer or other disposition has been
registered under the Act, (ii) such sale, transfer or other disposition is made
in conformity with Rule 145 promulgated
<PAGE>
by the Commission under the Act, or (iii) in the opinion of counsel reasonably
acceptable to Bradley, or a"no action" letter obtained by the undersigned from
the staff of the Commission, such sale, transfer or other disposition is
otherwise exempt from registration under the Act.
D. I understand that Bradley is under no obligation to register the sale,
transfer or other disposition of the Bradley Securities by me or on my behalf
under the Act or, except as expressly set forth in the Agreement, to take any
other action necessary in order to make compliance with an exemption from such
registration available.
E. I also understand that stop transfer instructions will be given to
Bradley's transfer agents with respect to the Bradley Securities and that there
will be placed on the certificates for the Bradley Securities issued to me, or
any substitutions therefor, a legend stating in substance:
"THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ISSUED IN
A TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECU-
RITIES ACT OF 1933 APPLIES. THE SHARES REPRESENTED BY THIS
CERTIFICATE MAY ONLY BE TRANSFERRED IN ACCORDANCE WITH THE
TERMS OF AN AGREEMENT DATED BETWEEN THE REGISTERED HOLDER
HEREOF AND BRADLEY, A COPY OF WHICH AGREEMENT IS
ON FILE AT THE PRINCIPAL OFFICES OF BRADLEY."
F. I also understand that unless the transfer by me of my Bradley
Securities has been registered under the Act or is a sale made in conformity
with the provisions of Rule 145, Bradley reserves the right to put the following
legend on the certificates issued to my transferee:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND WERE ACQUIRED
FROM A PERSON WHO RECEIVED SUCH SHARES IN A TRANSACTION TO
WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933
APPLIES. THE SHARES HAVE BEEN ACQUIRED BY THE HOLDER NOT
WITH A VIEW TO, OR FOR RESALE IN CONNECTION WITH, ANY
DISTRIBUTION THEREOF WITHIN THE MEANING OF THE SECURITIES
ACT OF 1933 AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANS-
FERRED EXCEPT IN ACCORDANCE WITH AN EXEMPTION FROM THE REGIS-
TRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933."
It is understood and agreed that the legend set forth in paragraphs E and F
above shall
<PAGE>
be removed by delivery of substitute certificates without such legend if such
legend is not required for purposes of the Act or this Agreement. It is
understood and agreed that such legends and the stop orders referred to above
will be removed if (i) two years shall have elapsed from the date the
undersigned acquired the Bradley Securities received in the Merger and the
provisions of Rule 145(d)(2) are then available to the undersigned, (ii) three
years shall have elapsed from the date the undersigned acquired the Bradley
Securities received in the Merger and the provisions of Rule 145(d)(3) are then
applicable to the undersigned, or (iii) Bradley has received either an opinion
of counsel, which opinion and counsel shall be reasonably satisfactory to
Bradley, or a "no action" letter obtained by the undersigned from the staff of
the Commission, to the effect that the restrictions imposed by Rule 145 under
the Act no longer apply to the undersigned.
Execution of this letter should not be considered an admission on my part
that I am an "affiliate" of Tucker as described in the first paragraph of this
letter or as a waiver of any rights I may have to object to any claim that I am
such an affiliate on or after the date of this letter.
Very truly yours,
Name
Accepted this ____ day of ______, 199__.
BRADLEY REAL ESTATE, INC.
By:___________________________________
Name:
Title:
<PAGE>
EXHIBIT 10.4
PURCHASE AND SALE OF SECURITIES
This Purchase and Sale of Securities dated as of October 30, 1995 (the
"Agreement"), is entered into by and among Kenneth L. Tucker ("KLT") and Richard
H. Tucker ("RHT" and, collectively with KLT, the "Tuckers") and Marianne Dunn
("MD") and Thomas P. D'Arcy ("TPD" and, collectively with MD, the "Investors").
WITNESSETH:
----------
WHEREAS, Bradley Real Estate, Inc. ("Bradley") and Tucker Properties
Corporation ("Tucker") are entering into a certain Agreement and Plan of Merger
(the "Merger Agreement") of even date herewith pursuant to which Tucker shall be
merged with and into Bradley (the "Merger");
WHEREAS, pursuant to the Merger, Bradley shall acquire all of Tucker's
ownership interests in each of the Tucker Properties and the Tucker Subsidiaries
(as each of such terms are defined in the Merger Agreement);
WHEREAS, the securities of one of the Tucker Subsidiaries, Tucker
Management Corp. ("TMC"), are owned by both Tucker Operating Limited Partnership
("TOP") and the Tuckers;
WHEREAS, in connection with the Merger the Tuckers have agreed to sell
their interests in TMC to the Investors;
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
herein contained and for other good and valuable consideration, the parties
hereto agree as follows:
1. SALE OF SECURITIES. Subject to, and in consideration of, the terms
------------------
and conditions of this Agreement, the Tuckers hereby sell, assign, transfer,
convey and deliver to the Investors all right, title and interest of the Tuckers
in TMC, including without limitation the 460 shares of common stock of TMC, $.01
par value per share (the "Common Stock") (representing 92% of the Common Stock),
provided TOP owns 8% of the Common Stock, and 25 shares of the preferred stock
of TMC, $.01 par value per share (the "Preferred Stock") (representing 5% of the
Preferred Stock), provided TOP owns 95% of the Preferred Stock, and the
Investors hereby acknowledge and consent to such sale, assignment, transfer,
conveyance and delivery.
2. PURCHASE PRICE. In consideration of the sale, assignment, transfer,
--------------
conveyance and delivery described above, at the Effective Time, the Investors
will pay each of the Tuckers $500 (the "Purchase Price") upon the effectiveness
of such sale, assignment, transfer, conveyance and delivery described above.
<PAGE>
3. EFFECTIVE DATE. The effective date of this Agreement shall be the
--------------
Effective Time. In the event the Merger is not consummated, this Agreement
shall be null and void.
4. REPRESENTATIONS AND COVENANTS OF THE TUCKERS.
--------------------------------------------
4.1 Each of the Tuckers owns beneficially and of record the number of
shares of the Common Stock and the Preferred Stock set forth opposite such
stockholder's name on Exhibit A hereto, free and clear of all pledges, liens,
---------
encumbrances, restrictions, voting agreements or trusts, rights, claims or
charges of any nature or kind whatsoever (collectively, "Claims"). Upon
delivery to the Investors of the certificates representing the shares owned by
each of the Tuckers duly endorsed in blank for transfer or with stock powers
attached duly executed in blank, against delivery of the Purchase Price, good
and valid title thereto shall be transferred to the Investors free and clear of
any and all Claims.
4.2 Each of the Tuckers has full right, authority, power and capacity
to enter into this Agreement and each agreement, document and instrument to be
executed and delivered by him pursuant to or as contemplated by this Agreement
and to carry out the transaction contemplated hereby and thereby. This Agreement
and each agreement, document and instrument to be executed and delivered by each
of the Tuckers pursuant to or as contemplated by this Agreement constitute, or
when executed and delivered will constitute, valid and binding obligations of
each of the Tuckers, enforceable in accordance with their respective terms. The
execution, delivery and performance by each of the Tuckers of this Agreement and
each such agreement, document and instrument:
(i) do not and will not violate any laws of the United States,
or any state or other jurisdiction applicable to either of the Tuckers or
require either of the Tuckers to obtain any approval, consent or waiver of,
or make any filing with, any person or entity (governmental or otherwise)
that has not been obtained or made; and
(ii) do not and will not result in a breach of, constitute a
default under, accelerate any obligation under or give rise to a right of
termination of any indenture or loan or credit agreement or any other
agreement, contract, instrument, mortgage, lien, lease, permit,
authorization, order, writ, judgment, injunction, decree, determination or
arbitration award to which either of the Tuckers is a party or by which the
property of either of the Tuckers is bound or affected, or result in the
creation or imposition of any mortgage, pledge, lien, security interest or
other charge or encumbrance on any of the Tucker Properties or any of the
assets of TMC.
4.3 Except for interests in TOP and the interests in TMC set forth in
Section 1 hereto and the interests in the common stock of Tucker, neither of the
Tuckers owns, directly or indirectly, any interest or investment (whether equity
or debt) in any of the Tucker Subsidiaries.
2
<PAGE>
5. RELEASE AND INDEMNIFICATION.
---------------------------
5.1 Subject to Section 2 hereof, each of the Tuckers hereby releases
and forever discharges Bradley and the Investors, each of the present and former
shareholders, directors, officers, employees and agents of Bradley, affiliates
of any of the foregoing and their respective successors and assigns (each a
"Released Person"), of and from all actions, causes of action, suits, debts,
dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants,
commitments, contracts, controversies, agreements, promises, variances,
trespasses, damages, judgments, extents, executions, claims and demand
whatsoever, in law or equity and/or any and all other applicable federal, state
or local statutes, laws, rules and regulations which either of the Tuckers
and/or any of their heirs, executors or administrators ever had, now has or
hereafter can, shall or may have against any Released Person, whether asserted,
unasserted, absolute, contingent, known or unknown, arising out of or relating
to the Common Stock or the Preferred Stock or the Tuckers' sale of the Common
Stock and the Preferred Stock to the Investors.
5.2 Subject to Section 2 hereof, each of the Tuckers agrees to
indemnify and hold harmless Bradley and the Investors against any losses,
claims, damages or liabilities to which any of Bradley or the Investors may
become subject, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon a breach of the
representations or covenants set forth in Section 4 hereof and will reimburse
each of Bradley and the Investors for any legal or other expenses reasonably
incurred by them in connection with investigating or defending against such
loss, claim, damage, liability or action.
6. MISCELLANEOUS.
-------------
6.1 The rights accruing pursuant to this Agreement shall not be
transferable by any party hereto without the prior written consent of each other
party hereto.
6.2 Every provision of this Agreement is intended to be severable,
and if any term or provision hereof is held to be illegal or invalid for any
reason whatsoever, such illegality or invalidity shall not affect the validity
of the remainder hereof.
6.3 All capitalized terms used but not defined herein shall have the
meanings ascribed thereto in the Merger Agreement.
6.4 This Agreement shall be governed by and construed in accordance
with the laws of the State of Maryland.
3
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
/s/ KENNETH L. TUCKER
----------------------------
Kenneth L. Tucker
/s/ RICHARD H. TUCKER
----------------------------
Richard H. Tucker
/s/ MARIANNE DUNN
-----------------------------
Marianne Dunn
/s/ THOMAS P. D'ARCY
-----------------------------
Thomas P. D'Arcy
4
<PAGE>
EXHIBIT A
---------
Kenneth L. Tucker 368 shares of Common Stock
20 shares of Preferred Stock
Richard H. Tucker 92 shares of Common Stock
5 shares of Preferred Stock
5
<PAGE>
EXHIBIT 10.6
FIRST AMENDMENT TO
INDEMNIFICATION AGREEMENT
THIS AGREEMENT (the "First Amendment") is the first amendment to the
INDEMNIFICATION AGREEMENT dated as of ______ (the "Indemnification Agreement")
by and between Tucker Properties Corporation ("TPC"), a Maryland corporation,
and [name of director] (the "Indemnitee").
WHEREAS, TPC has entered into that certain Agreement and Plan of Merger dated
October __, 1995 (the "Merger Agreement") with Bradley Real Estate, Inc.
("Bradley"), a Maryland corporation, pursuant to which TPC will merge with and
into Bradley at the Effective Time (the "Merger," and the surviving corporation
of such merger being the "Surviving Corporation");
WHEREAS, TPC and Bradley have agreed that, subject to the consummation of the
Merger, the Surviving Corporation shall have the obligation to indemnify certain
individuals, and be subject to the rights of those individuals to be
indemnified, as set forth in Section 7.12 of the Merger Agreement;
WHEREAS, TPC and Bradley deem it desirable that the Indemnification Agreement be
amended by this First Amendment, effective as of the Effective Time, to reflect
those indemnification rights and obligations set forth in Section 7.12 of the
Merger Agreement;
NOW, THEREFORE, in consideration of the premises and covenants contained herein
and in the Merger Agreement, and subject to the consummation of the Merger, TPC
and the Indemnitee hereby agree that the Indemnification Agreement is hereby
amended as follows:
1. Indemnification Agreement Remains in Effect. Except as expressly set
-------------------------------------------
forth herein, the Indemnification Agreement shall remain in full force and
effect.
2. Certain Provisions of the Merger Agreement. The provisions of Section
------------------------------------------
7.12 of the Merger Agreement are hereby incorporated by reference and made a
part of this First Amendment and the Indemnification Agreement, as amended. If
there is a conflict between the provisions of Section 7.12 of the Merger
Agreement, and either the First Amendment or the Indemnification Agreement, the
provisions of such Section 7.12 shall be given precedence but only to the extent
that such provisions expressly provide the treatment to be given to any matter
in which there is a conflict.
3. References to TPC. All references to TPC in the Indemnification
-----------------
Agreement shall hereafter be deemed to refer to the Surviving Corporation.
4. Deletion of the Definition of Change in Control. Paragraph 1(A) of
-----------------------------------------------
the Indemnification Agreement is hereby deleted in its entirety.
1
<PAGE>
5. Deletion of the Definition of Independent Counsel. Paragraph 1(F) of
-------------------------------------------------
the Indemnification Agreement is hereby deleted in its entirety.
6. Determination of Entitlement to Indemnification. Paragraph 6(B) of
-----------------------------------------------
the Indemnification Agreement is hereby amended by deleting the paragraph in its
entirety and substituting therefor the following:
(B) Upon such written request pursuant to subparagraph 6(A), a
determination with respect to the Indemnitee's entitlement thereto
shall be made by (x) Sidley & Austin or (y) in the event Sidley &
Austin shall not be available to make such determination, then Skadden
Arps Slate Meagher & Flom; or (z) in the event that neither Sidley &
Austin nor Skadden Arps Slate Meagher & Flom shall be available to
make such determination, then Kirkland & Ellis; or (aa) in the event
that none of Sidley & Austin, Skadden Arps Slate Meagher & Flom or
Kirkland & Ellis shall be available to make such determination, then
O'Melveny & Myers.
7. Deletion of Procedures for Selection of Independent Counsel.
-----------------------------------------------------------
Paragraph 6(D) of the Indemnification Agreement is hereby deleted in its
entirety.
8. Deletion of Sixty Day Limit for Determining Entitlement to be
-------------------------------------------------------------
Indemnified. Paragraph 7(B) is hereby deleted in its entirety.
- -----------
9. Deletion of Obligation to Establish a Trust Upon a Change in Control.
--------------------------------------------------------------------
As long as Bradley has complied with Section 7.12(c) of the Merger Agreement as
of the Effective Time, Paragraph 9 is hereby deleted in its entirety and shall
be null and void and have no effect.
10. Deletion of Provision Regarding Effect of Insurance. Paragraph 10(B)
---------------------------------------------------
is hereby deleted in its entirety.
11. Amendment of Provision Regarding Notices. Paragraph 17 of the
----------------------------------------
Indemnification Agreement is hereby amended by deleting the provision with
respect to notices to be sent to the Indemnitee, and the provision with respect
to notices to be sent to TPC and substituting therefor the following:
If to the Indemnitee, to:
[Name of Director]
[Address]
2
<PAGE>
With copies to:
Errol R. Halperin, Esq.
Rudnick & Wolfe
203 North LaSalle Street
Chicago, IL 60601
Edward J. Schneidman, Esq.
Mayer, Brown & Platt
190 South LaSalle Street
Chicago, IL 60603
If to Bradley, to:
Bradley Real Estate, Inc.
250 Boylston Street
Boston, MA 02116
With a copy to:
Joseph L. Johnson III, Esq.
Goodwin, Procter & Hoar
Exchange Place
Boston, MA 02116
12. Defined Terms. Capitalized terms used but not defined herein shall
-------------
have the meaning set forth in the Merger Agreement.
13. Effective Date of this First Amendment. This First Amendment shall
--------------------------------------
become effective on and as of the Effective Time. If for any reason the Merger
Agreement is terminated or the Merger is not consummated as contemplated in the
Merger Agreement, this First Amendment shall be null and void ab initio.
14. Governing Law. The parties agree and acknowledge that this First
-------------
Amendment shall be governed by, and construed and enforced in accordance with,
the laws of the State of Maryland.
15. Counterparts. This First Amendment may be executed in one or more
------------
counterparts all of which shall be considered one and the same amendment and
each of which shall be deemed to be an original.
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment as of
____________________, 1995.
TUCKER PROPERTIES CORPORATION
By: ___________________________________
Kenneth L. Tucker
Chairman of the Board and President
INDEMNITEE
____________________________________
[NAME]
4
<PAGE>
EXHIBIT 21.1
Subsidiaries of Bradley Real Estate, Inc.
-----------------------------------------
Bradley Real Estate Management, Inc.
Jurisdiction of Incorporation: Massachusetts
Name Under Which Business is Transacted: Bradley Real Estate Management,
Inc.
Bradley Midwest Management, Inc.
Jurisdiction of Incorporation: Minnesota
Name Under Which Business is Transacted: Bradley Midwest Management, Inc.
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
Bradley Real Estate, Inc.:
We consent to the use of our report dated January 23, 1995 incorporated herein
by reference and to the reference to our firm under the heading "Experts" in the
Joint Proxy Statement/Prospectus.
/s/ KPMG PEAT MARWICK LLP
KPMG Peat Marwick LLP
Boston, Massachusetts
December 6, 1995
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
Tucker Properties Corporation
We consent to the inclusion by reference in this registration statement on Form
S-4, to which this consent is filed as an exhibit, of our reports dated March
24, 1995 on our audits of the financial statements and the financial statement
schedule of Tucker Properties Corporation and Subsidiaries. We also consent to
the reference to our firm under the caption "Experts".
/s/ COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Chicago, Illinois
December 5, 1995
<PAGE>
EXHIBIT 99.1
BRADLEY REAL ESTATE, INC.
REVOCABLE PROXY
(SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
BRADLEY REAL ESTATE, INC. FOR A SPECIAL MEETING
OF STOCKHOLDERS TO BE HELD ON FEBRUARY __, 1996)
The undersigned hereby appoints E. Lawrence Miller and Thomas P.
D'Arcy, and any one or more of them, with full power of substitution, as
attorneys and proxies for the undersigned, and authorizes each of them to
represent and vote shares of common stock of Bradley Real Estate, Inc.
("Bradley") standing in the name of the undersigned on the books and records of
Bradley at the close of business on January __, 1996 which the undersigned is
entitled to cast at the Special Meeting of Stockholders to be held at
_____________________, Boston, Massachusetts __________________ on February __,
1996 at 10:00 a.m., Eastern time, and at any and all adjournments or
postponements thereof, as follows:
1. To approve the merger of Tucker Properties Corporation ("Tucker")
with and into Bradley (the "Merger") and the Agreement and Plan of Merger, dated
as of October 30, 1995, by and between Bradley and Tucker, pursuant to which,
among other things, each outstanding share of Tucker common stock, par value
$.001 per share ("Tucker Common Stock"), will be converted into the right to
receive a percentage of a share of Bradley common stock, par value $.01 per
share ("Bradley Common Stock"), to be determined as follows. If the average per
share closing price of Bradley Common Stock for the 20 trading days prior to the
fifth day preceding the closing of the Merger is $16.00 or more, each share of
Tucker Common Stock will be exchanged for .665 of a share of Bradley Common
Stock. If such average closing price is between $15.50 and $16.00, the exchange
ratio will be determined by dividing $10.64 by the average closing price. If the
average closing price is $15.50 or less, the exchange ratio will be .686 of a
share of Bradley Common Stock.
[_] FOR [_] AGAINST [_] ABSTAIN
THIS PROXY WILL BE VOTED FOR THE PROPOSITION STATED ABOVE IF NO CHOICE IS MADE
HEREON.
2. To vote in their discretion upon such other matters as may
properly come before the meeting or any adjournment thereof.
Should the undersigned be present and elect to vote at the Special
Meeting or at any adjournment thereof and, after notification to the Secretary
of Bradley at the Special Meeting of the undersigned's decision to terminate
this Proxy, then the power of said attorneys and proxies shall be deemed
terminated and of no further force and effect.
The undersigned acknowledges receipt of a Notice of Special Meeting
called for the ____ day of February, 1996 and the Joint Proxy
Statement/Prospectus dated the ____ day of January, 1996 prior to the execution
of this Proxy.
Date:________________________________________
_____________________________________________
Print Name of Stockholder
_____________________________________________
Signature of Stockholder
Date:________________________________________
_____________________________________________
Print Name of Stockholder
_____________________________________________
Signature of Stockholder
(Please sign exactly as your name appears on
the envelope in which this card was mailed.
When signing as attorney, executor,
administrator, trustee or guardian, please
give your full title. If more than one
trustee, all should sign. If stocks are held
jointly, each holder should sign.)
<PAGE>
EXHIBIT 99.2
TUCKER PROPERTIES CORPORATION
REVOCABLE PROXY
(SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
TUCKER PROPERTIES CORPORATION FOR A SPECIAL MEETING
OF STOCKHOLDERS TO BE HELD ON FEBRUARY __, 1996)
The undersigned hereby appoints Kenneth L. Tucker and Richard H.
Tucker, and any one or more of them, with full power of substitution, as
attorneys and proxies for the undersigned, and authorizes each of them to
represent and vote shares of common stock of Tucker Properties Corporation
("Tucker") standing in the name of the undersigned on the books and records of
Tucker at the close of business on January __, 1996 which the undersigned is
entitled to cast at the Special Meeting of Stockholders to be held at
_____________________, Chicago, Illinois ______________________ on February __,
1996 at 9:00 a.m., Central time, and at any and all adjournments or
postponements thereof, as follows:
1. To approve the merger (the "Merger") of Tucker with and into
Bradley Real Estate, Inc. ("Bradley") and the Agreement and Plan of Merger,
dated as of October 30, 1995, by and between Bradley and Tucker, pursuant to
which, among other things, each outstanding share of Tucker common stock, par
value $.001 per share ("Tucker Common Stock"), will be converted into the right
to receive a percentage of a share of Bradley common stock, par value $.01 per
share ("Bradley Common Stock"), to be determined as follows. If the average per
share closing price of Bradley Common Stock for the 20 trading days prior to the
fifth day preceding the closing of the Merger is $16.00 or more, each share of
Tucker Common Stock will be exchanged for .665 of a share of Bradley Common
Stock. If such average closing price is between $15.50 and $16.00, the exchange
ratio will be determined by dividing $10.64 by the average closing price. If the
average closing price is $15.50 or less, the exchange ratio will be .686 of a
share of Bradley Common Stock.
[_] FOR [_] AGAINST [_] ABSTAIN
THIS PROXY WILL BE VOTED FOR THE PROPOSITION STATED ABOVE IF NO CHOICE IS MADE
HEREON.
2. To vote in their discretion upon such other matters as may
properly come before the meeting or any adjournment thereof.
Should the undersigned be present and elect to vote at the Special
Meeting or at any adjournment thereof and, after notification to the Secretary
of Tucker at the Special Meeting of the undersigned's decision to terminate this
Proxy, then the power of said attorneys and proxies shall be deemed terminated
and of no further force and effect.
The undersigned acknowledges receipt of a Notice of Special Meeting
called for the ____ day of February, 1996 and the Joint Proxy
Statement/Prospectus dated the ____ day of January, 1996 prior to the execution
of this Proxy.
Date:___________________________________
________________________________________
Print Name of Stockholder
________________________________________
Signature of Stockholder
Date:___________________________________
________________________________________
Print Name of Stockholder
________________________________________
Signature of Stockholder
(Please sign exactly as your name
appears on the envelope in which this
card was mailed. When signing as
attorney, executor, administrator,
trustee or guardian, please give your
full title. If more than one trustee,
all should sign. If stocks are held
jointly, each holder should sign.)
