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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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DUKE-WEEKS REALTY CORPORATION
DUKE-WEEKS REALTY LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DUKE-WEEKS REALTY CORPORATION -- INDIANA DUKE-WEEKS REALTY CORPORATION -- 35-1740409
DUKE-WEEKS REALTY LIMITED PARTNERSHIP -- INDIANA DUKE-WEEKS REALTY LIMITED
PARTNERSHIP -- 35-1898425
(State or other jurisdiction of incorporation or (I.R.S. Employer Identification No.)
organization)
8888 KEYSTONE CROSSING, SUITE 1200 DENNIS D. OKLAK
INDIANAPOLIS, INDIANA 46240 8888 KEYSTONE CROSSING, SUITE 1200
(317) 808-6000 INDIANAPOLIS, INDIANA 46240
(317) 808-6000
(Address, including zip code, and telephone (Name, address, including zip code, and
number, telephone number,
including area code, of principal executive including area code, of agent for service)
offices)
</TABLE>
Copy To:
ALAN W. BECKER, ESQ.
BOSE MCKINNEY & EVANS LLP
135 NORTH PENNSYLVANIA STREET, SUITE 2700
INDIANAPOLIS, INDIANA 46204
(317) 684-5000
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: From time to
time after the effective date of this Registration Statement. If the only
securities being registered on this Form are being offered pursuant to dividend
or interest reinvestment plans, please check the following box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED (1)(2) OFFERING PRICE(3)(4) REGISTRATION FEE(4)
<S> <C> <C>
Common Stock, $.01 par value....................
Preferred Stock, $.01 par value.................
Depositary Shares............................... $100,000,000
Debt Securities................................. $400,000,000
Total....................................... $500,000,000 $132,000.00
</TABLE>
(1) This Registration Statement also covers contracts which may be issued by the
Registrants under which the counterparty may be required to purchase Debt
Securities, Preferred Stock, Depositary Shares or Common Stock covered
hereby.
(2) The Common Stock, Preferred Stock and Depositary Shares will be issued by
Duke-Weeks Realty Corporation, and the Debt Securities will be issued by
Duke-Weeks Realty Limited Partnership and will be non-convertible investment
grade debt securities.
(3) In U.S. Dollars or the equivalent thereof denominated in one or more foreign
currencies or units of two or more foreign currencies or composite
currencies (such as European Currency Units).
(4) The prospectus in this registration statement also includes $11,350,000 in
proposed aggregate offering price of Common Stock, Preferred Stock and
Depositary Shares and $20,150,000 in proposed aggregate offering price of
Debt Securities registered in registration statement nos. 333-04695 and
333-26845. Registration fees of $9,963.43 were previously paid on such
securities.
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THE PROSPECTUS INCLUDED IN THIS REGISTRATION STATEMENT IS A COMBINED
PROSPECTUS PURSUANT TO RULE 429 UNDER THE SECURITIES ACT AND RELATES TO (A) THE
$100,000,000 OF COMMON STOCK, PREFERRED STOCK AND DEPOSITARY SHARES AND
$400,000,000 OF DEBT SECURITIES REGISTERED PURSUANT TO THIS REGISTRATION
STATEMENT, (B) $10,000,000 OF COMMON STOCK, PREFERRED STOCK AND DEPOSITARY
SHARES REGISTERED IN REGISTRATION STATEMENT NO. 333-04695 (EFFECTIVE JUNE 6,
1996), (C) $1,350,000 OF COMMON STOCK, PREFERRED STOCK AND DEPOSITARY SHARES AND
$20,157,000 OF DEBT SECURITIES REGISTERED IN REGISTRATION STATEMENT NO.
333-26845 (EFFECTIVE MAY 27, 1997) AND (D) $214,398,000 OF COMMON STOCK,
PREFERRED STOCK AND DEPOSITARY SHARES AND $50,428,000 OF DEBT SECURITIES
REGISTERED IN REGISTRATION STATEMENT NO. 333-49911 (EFFECTIVE APRIL 20, 1998).
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
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<PAGE>
PRELIMINARY PROSPECTUS DATED MAY 26, 2000
PROSPECTUS
$796,333,000
DUKE-WEEKS REALTY CORPORATION
COMMON STOCK, PREFERRED STOCK AND DEPOSITARY SHARES
DUKE-WEEKS REALTY
LIMITED PARTNERSHIP
DEBT SECURITIES
You should read this prospectus and any supplement carefully before you
invest.
This prospectus describes debt and equity securities that we may issue and
sell at various times:
- Our prospectus supplements will contain the specific terms of each
issuance of debt or equity securities.
- Duke-Weeks Realty Corporation can issue common stock, preferred stock and
depositary shares with a total offering price of up to $325,748,000 under
this prospectus.
- Duke-Weeks Realty Limited Partnership can issue debt securities with a
total offering price of up to $470,585,000 under this prospectus.
- We may sell the debt and equity securities to or through underwriters,
dealers or agents.
We may also sell debt and equity securities directly to investors.
The common shares of Duke-Weeks Realty Corporation are listed on the New
York Stock Exchange under the trading symbol "DRE."
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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The date of this prospectus is , 2000.
<PAGE>
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
SEC using a "shelf" registration process. Under this shelf registration process,
Duke-Weeks Realty Corporation, which is sometimes referred to in this prospectus
as "Duke", may sell any combination of common stock, preferred stock and
depositary shares as described in this prospectus in one or more offerings for
total proceeds of up to $325,748,000, and Duke-Weeks Realty Limited Partnership,
which is sometimes referred to in this prospectus as the "Operating
Partnership", may sell debt securities of various terms in one or more offerings
for total proceeds of up to $470,585,000. This prospectus provides you with a
general description of the securities we may offer. Each time we sell
securities, we will provide a prospectus supplement that will contain specific
information about the terms of that offering. This prospectus supplement may
add, update or change information contained in this prospectus. It is important
for you to consider the information contained in this prospectus and any
prospectus supplement together with additional information described under the
heading "Where You Can Find More Information."
DUKE AND THE OPERATING PARTNERSHIP
Duke is a self-administered and self-managed real estate investment trust (a
"REIT") that began operations through a related entity in 1972. As of March 31,
2000, we:
- Owned 933 industrial, office and retail properties (including properties
under development), consisting of over 102 million square feet located in
13 states; and
- Owned or controlled approximately 3,900 acres of land with an estimated
future development potential of approximately 60 million square feet of
industrial, office and retail properties.
Duke directly or indirectly hold all of its interests in its properties and
land and it conducts all of its operations through the Operating Partnership.
Duke controls the Operating Partnership as its sole general partner and owned,
as of March 31, 2000, approximately 87% of the Operating Partnership's common
units. Holders of common units in the Operating Partnership (other than Duke)
may exchange them for Duke common stock on a one for one basis. When common
units are exchanged for common stock, Duke's percentage interest in the
Operating Partnership increases.
In addition to owning properties and land, we provide the following services
for our properties:
- leasing;
- management;
- construction;
- development; and
- other tenant-related services.
We also provide these services on a fee basis through Duke Realty Services
Limited Partnership for certain properties owned by third parties.
Duke-Weeks Realty Corporation is an Indiana corporation that was originally
incorporated in the State of Delaware in 1985, and reincorporated in the State
of Indiana in 1992. It is the successor company of the merger of Weeks
Corporation with Duke Realty Investments, Inc., which took place on July 2,
1999. Duke-Weeks Realty Limited Partnership is an Indiana limited partnership
that was originally formed in 1993. It is the successor limited partnership of
the merger of Weeks Realty, L.P. with Duke Realty Limited Partnership, which
took place on July 1, 1999. Our executive offices are located at 8888 Keystone
Crossing, Suite 1200, Indianapolis, Indiana 46240, and our telephone number is
(317) 808-6000.
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USE OF PROCEEDS
The terms of the partnership agreement of the Operating Partnership require
Duke to invest the net proceeds of any sale of common stock, preferred stock or
depositary shares in the Operating Partnership in exchange for additional common
units or preferred units. We will use the net proceeds from the sale of these
securities for general corporate purposes. These purposes may include the
development and acquisition of additional rental properties and other
acquisition transactions, the payment of certain outstanding debt, and
improvements to certain properties in our portfolio. If we identify a specific
purpose for the net proceeds of an offering, we will describe that purpose in
the applicable prospectus supplement.
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RATIOS OF EARNINGS TO FIXED CHARGES
The following table shows ratios of earnings to fixed charges and preference
dividends (as applicable) for Duke and the Operating Partnership for the periods
shown.
<TABLE>
<CAPTION>
YEAR ENDED OPERATING
DECEMBER 31, DUKE PARTNERSHIP
- ------------ -------- -----------
<S> <C> <C>
1999........................................................ 1.79 1.77
1998........................................................ 2.05 2.05
1997........................................................ 2.12 2.11
1996........................................................ 2.18 2.20
1995........................................................ 2.38 2.38
1994........................................................ 2.33 2.33
</TABLE>
On a pro forma basis assuming the mergers with Weeks Corporation and Weeks
Realty, L.P. had occurred as of the beginning of the respective periods, Duke's
ratio of earnings to fixed charges and preference dividends would have been 1.75
for the year ended December 31, 1999, and the Operating Partnership's ratio of
earnings to fixed charges would have been 1.72 for the year ended December 31,
1999. For the three months ended March 31, 2000, the ratios of earnings to fixed
charges for Duke and the Operating Partnership were 1.61 and 1.59, respectively.
For purposes of computing these ratios, earnings have been calculated by
adding fixed charges, excluding capitalized interest, to income (loss) before
gains or losses on property sales and (if applicable) minority interest in the
Operating Partnership. Fixed charges consist (if applicable) of interest costs,
whether expensed or capitalized, the interest component of rental expense and
amortization of debt issuance costs.
DESCRIPTION OF DEBT SECURITIES
The debt securities will be issued under an indenture between the Operating
Partnership and Bank One Trust Company, N.A. (formerly known as The First
National Bank of Chicago), as trustee. The trustee's office is currently located
at 14 Wall Street, Eighth Floor, New York, New York 10005. The indenture is
governed by the Trust Indenture Act of 1939. The following description is a
summary of the material provisions of the indenture. It does not restate those
agreements in their entirety. We urge you to read the indenture because it, and
not this description, defines your rights as holders of any debt securities
issued by the Operating Partnership. We have filed copies of the indenture with
the SEC.
GENERAL
The debt securities will be direct, unsecured obligations of the Operating
Partnership and will rank equal in right of payment with all other unsecured and
unsubordinated indebtedness of the Operating Partnership. The debt securities
will be effectively subordinated to the prior claims of each secured mortgage
lender to any specific property which secures that lender's mortgage. At March
31, 2000, the total outstanding debt of the Operating Partnership was $2.3
billion, of which $485.4 million was secured debt.
The debt securities may be issued in one or more series without limit as to
aggregate principal amount. Duke can establish an issue of debt securities as
sole general partner of the Operating Partnership by a resolution of its board
of directors or by a supplemental indenture. The Operating Partnership is not
required to issue all debt securities of one series at the same time and, unless
otherwise provided, the Operating Partnership may reopen a series of debt
securities without the consent of the holders of the debt securities of such
series to issue additional debt securities of such series.
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The indenture provides that there may be more than one trustee, each with
respect to one or more series of debt securities. Any trustee under the
indenture may resign or be removed with respect to one or more series of debt
securities, and a successor trustee may be appointed to act with respect to that
series. In the event that two or more persons are acting as trustee with respect
to different series of debt securities, each of those trustees shall be a
trustee of a trust under the indenture separate and apart from the trust
administered by any other trustee, and except as otherwise described in this
prospectus, any action described in this prospectus to be taken by a trustee may
be taken by each such trustee with respect to, and only with respect to, the one
or more series of debt securities for which it is trustee under the indenture.
The specific terms of any series of debt securities being offered will be
contained in a prospectus supplement, including:
- the title of the debt securities;
- the aggregate principal amount of the debt securities and any limit on the
aggregate principal amount;
- the price at which the Operating Partnership will issue the debt
securities;
- the fixed or variable rate at which the debt securities will bear
interest, or the method by which such rate will be determined;
- the basis upon which the Operating Partnership will calculate interest on
the debt securities if other than a 360-day year of twelve 30-day months;
- the timing and manner of making principal, interest and any premium
payments on the debt securities;
- the person to whom interest will be payable;
- the places where you may serve notices about the debt securities and the
indenture, if other than as described in this prospectus;
- the portion of the principal amount of the debt securities payable upon
acceleration, if it is other than the full principal amount;
- whether and under what conditions the debt securities are redeemable at
the option of the Operating Partnership or of the holders;
- any sinking fund or similar provisions;
- the currency or currencies in which the debt securities are payable, if
other than U.S. dollars;
- the events of default or covenants of the debt securities, if they are
different from or in addition to those described in this prospectus;
- whether the debt securities will be issued in certificated and/or
book-entry form;
- whether the debt securities will be in registered or bearer form and their
denominations if other than $1,000 for registered form or $5,000 for
bearer form;
- whether the defeasance and covenant defeasance provisions described in
this prospectus are applicable to the debt securities or are modified in
any manner;
- if the debt securities are to be issued upon the exercise of debt
warrants, the time, manner and place for the debt securities to be
authenticated and delivered;
- whether and under what circumstances the Operating Partnership will pay
additional amounts on the debt securities for any tax, assessment or
governmental charge and, if so, whether the
5
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Operating Partnership will have the option to redeem the debt securities
instead of making such a payment; and
- any other terms of such debt securities.
The debt securities may provide for less than their entire principal amount
to be payable upon acceleration of their maturity. Any material special U.S.
federal income tax, accounting and other considerations applicable to such
original issue discount securities will be described in the prospectus
supplement.
DENOMINATIONS, INTEREST, REGISTRATION AND TRANSFER
Normally, the Operating Partnership will issue debt securities in
denominations of:
- $1,000 if they are in registered form;
- $5,000 if they are in bearer form; or
- any denomination if they are in global form.
If the Operating Partnership issues debt securities in denominations other than
these, they will be described in the prospectus supplement.
Unless the prospectus supplement specifies otherwise, the principal,
interest and any premium on any series of debt securities will be payable at the
corporate trust office of the trustee, initially located at 14 Wall Street,
Eighth Floor, New York, New York, 10005. The Operating Partnership may choose,
however, to pay interest by check mailed to the address of the person entitled
to the payment as it appears in the applicable security register or by wire
transfer of funds at an account maintained within the United States. The
Operating Partnership may change the paying agent or registrar for a series of
debt securities without prior notice to the holders of the debt securities, and
the Operating Partnership or any of its subsidiaries may act as paying agent or
registrar.
Any interest not punctually paid or duly provided for on any interest
payment date with respect to a debt security will immediately cease to be
payable to the holder on the applicable regular record date and may either be
paid:
- to the person in whose name the debt security is registered at the close
of business on a special record date established by the trustee, who will
provide notice to the holder of the debt security not less than 10 days
prior to such a special record date; or
- at any time in any other lawful manner.
If any interest date or a maturity date falls on a day that is not a
business day, the required payment will be made on the next business day as if
it were made on the date the payment was due and no interest will accrue on the
amount so payable for the period from and after such interest payment date or
such maturity date, as the case may be. For purposes of the indenture, a
"business day" is any day, other than a Saturday or Sunday, on which banking
institutions in The City of New York are open for business.
Subject to certain limitations imposed upon debt securities issued in
book-entry form, you may exchange debt securities for different denominations of
the same series or surrender debt securities for transfer at the corporate trust
office of the trustee. Every debt security surrendered for transfer or exchange
must be duly endorsed or accompanied by a written instrument of transfer. The
Operating Partnership will not make any service charge for any transfer or
exchange of any debt securities, but the trustee or the Operating Partnership
may require payment of a sum sufficient to cover any applicable tax or other
governmental charge. If the applicable prospectus supplement refers to any
transfer agent in addition to the trustee initially designated by the Operating
Partnership for any series
6
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of debt securities, the Operating Partnership may at any time rescind the
designation of any such transfer agent or approve a change in the location
through which any such transfer agent acts, except that Operating Partnership
will be required to maintain a transfer agent in each place of payment for a
series. The Operating Partnership may at any time designate additional transfer
agents with respect to any series of debt securities.
Neither the Operating Partnership nor the trustee is required:
- to issue, transfer or exchange any debt security if such debt security may
be among those selected for redemption during a period beginning at the
opening of business 15 days before selection of the debt securities to be
redeemed and ending at the close of business on:
- the day of the mailing of the relevant notice of redemption if such
debt securities are issuable only as registered securities; and
- the day of the first publication of the relevant notice of redemption
if such debt securities are issuable as bearer securities; or
- the mailing of the relevant notice of redemption if debt securities
issuable as bearer securities are also issuable as registered
securities and there is no publication; or
- to register the transfer of or exchange any registered security selected
for redemption in whole or in part, except, in the case of any registered
security to be redeemed in part, the portion not to be redeemed; or
- to exchange any bearer security selected for redemption except that such a
bearer security may be exchanged for a registered security of that series
and like tenor if such registered security is simultaneously surrendered
for redemption; or
- to issue, transfer or exchange any debt security which has been
surrendered for repayment at the option of the holder, except any portion
of such debt security not to be redeemed.
MERGER, CONSOLIDATION OR SALE
The Operating Partnership may consolidate with, or sell, lease or convey all
or substantially all of its assets to, or merge with or into, any other entity,
provided that:
- the Operating Partnership is the continuing entity, or the successor
entity (if other than the Operating Partnership) formed by or resulting
from any such consolidation or merger or which has received the transfer
of such assets expressly assumes payment of the principal, interest and
any premium on all the notes and the due and punctual performance and
observance of all of the covenants and conditions contained in the
indenture;
- immediately after giving effect to the transaction and treating any
indebtedness which becomes an obligation of the Operating Partnership or
any subsidiary as a result of the transaction as having been incurred by
the Operating Partnership or such subsidiary at the time of such
transaction, no event of default under the indenture, and no event which,
after notice or the lapse of time, or both, would become such an event of
default, has occurred and is continuing; and
- an officer's certificate and legal opinion covering such conditions are
delivered to the trustee.
Except for the above restrictions, the indenture does not contain any other
provisions that would limit the ability of the Operating Partnership to incur
indebtedness or that would afford holders of the notes protection in the event
of:
- a highly leveraged or similar transaction involving the Operating
Partnership, the management of the Operating Partnership or Duke, or any
affiliate of any such party;
7
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- a change of control; or
- a reorganization, restructuring, merger or similar transaction involving
the Operating Partnership that may adversely affect the holders of the
debt securities.
In addition, subject to the limitations on merger, consolidation or sale
described above, the Operating Partnership may enter into certain transactions
in the future, such as the sale of all or substantially all of its assets or the
merger or consolidation of the Operating Partnership, that would increase the
amount of the Operating Partnership's indebtedness or substantially reduce or
eliminate its assets, which may have an adverse effect on the Operating
Partnership's ability to service its indebtedness, including the debt
securities.
CERTAIN FINANCIAL COVENANTS
LIMITATIONS ON INCURRENCE OF DEBT. The Operating Partnership will not, and
will not permit any subsidiary to, incur any Debt (as defined below), other than
intercompany debt (representing Debt to which the only parties are the Operating
Partnership, Duke and any of their subsidiaries (but only so long as such Debt
is held solely by any of the Operating Partnership, Duke and any subsidiary)
that is subordinate in right of payment to the debt securities) if, immediately
after giving effect to the incurrence of such additional Debt, the aggregate
principal amount of all outstanding Debt of the Operating Partnership and its
subsidiaries on a consolidated basis determined in accordance with generally
accepted accounting principles is greater than 55% of the sum of:
- the Operating Partnership's Total Assets (as defined below) as of the end
of the calendar quarter covered in the Operating Partnership's Annual
Report on Form 10-K or Quarterly Report on Form 10-Q, as the case may be,
most recently filed with the SEC (or, if such filing is not permitted
under the Exchange Act, with the trustee) prior to the incurrence of such
additional Debt; and
- the increase in Total Assets from the end of such quarter including,
without limitation, any increase in Total Assets resulting from the
incurrence of such additional Debt (such increase together with the
Operating Partnership's Total Assets is referred to as the "Adjusted Total
Assets").
In addition to the foregoing limitation on the incurrence of Debt, the
Operating Partnership will not, and will not permit any subsidiary to, incur any
Debt if the ratio of Consolidated Income Available for Debt Service (as defined
below) to the amount which is expensed for interest on Debt for the four
consecutive fiscal quarters most recently ended prior to the date on which such
additional Debt is to be incurred shall have been less than 2.0 to 1, on a pro
forma basis after giving effect to the incurrence of such Debt and to the
application of the proceeds from such Debt, and calculated on the assumption
that:
- such Debt and any other Debt incurred by the Operating Partnership or its
subsidiaries since the first day of such four-quarter period and the
application of the proceeds therefrom, including to refinance other Debt,
had occurred at the beginning of such period;
- the repayment or retirement of any other Debt by the Operating Partnership
or its subsidiaries since the first day of such four-quarter period had
been incurred, repaid or retired at the beginning of such period (except
that, in making such computation, the amount of Debt under any revolving
credit facility shall be computed based upon the average daily balance of
such Debt during such period);
- the income earned on any increase in Adjusted Total Assets since the end
of such four-quarter period had been earned, on an annualized basis,
during such period; and
8
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- in the case of any acquisition or disposition by the Operating Partnership
or any subsidiary of any asset or group of assets since the first day of
such four-quarter period, including, without limitation, by merger, stock
purchase or sale, or asset purchase or sale, such acquisition or
disposition or any related repayment of Debt had occurred as of the first
day of such period with the appropriate adjustments with respect to such
acquisition or disposition being included in such pro forma calculation.
In addition to the foregoing limitations on the incurrence of Debt, the
Operating Partnership will not, and will not permit any subsidiary to, incur any
Debt secured by any mortgage, lien, charge, pledge, encumbrance or security
interest of any kind upon any of the property of the Operating Partnership or
any subsidiary, whether owned at the date of the indenture or subsequently
acquired, if, immediately after giving effect to the incurrence of such
additional secured Debt, the aggregate principal amount of all outstanding
secured Debt of the Operating Partnership and its subsidiaries on a consolidated
basis is greater than 40% of the Operating Partnership's Adjusted Total Assets.
For purposes of the above provisions regarding the limitation on the
incurrence of Debt, Debt is deemed to be "incurred" by the Operating Partnership
and its subsidiaries on a consolidated basis whenever the Operating Partnership
and its subsidiaries on a consolidated basis create, assume, guarantee or
otherwise become liable with respect to such Debt.
MAINTENANCE OF TOTAL UNENCUMBERED ASSETS. The Operating Partnership is
required to maintain Total Unencumbered Assets of not less than 185% of the
aggregate outstanding principal amount of the unsecured debt of the Operating
Partnership.
As used here:
"CONSOLIDATED INCOME AVAILABLE FOR DEBT SERVICE" for any period means
Consolidated Net Income (as defined below) of the Operating Partnership and its
subsidiaries,
- plus amounts which have been deducted for:
- interest on Debt of the Operating Partnership and its subsidiaries;
- provision for taxes of the Operating Partnership and its subsidiaries
based on income;
- amortization of debt discount;
- depreciation and amortization;
- the effect of any noncash charge resulting from a change in accounting
principles in determining Consolidated Net Income for such period;
- amortization of deferred charges; and
- provisions for or realized losses on properties; and
- less amounts which have been included for gains on properties.
"CONSOLIDATED NET INCOME" for any period means the amount of consolidated
net income (or loss) of the Operating Partnership and its subsidiaries for the
period determined on a consolidated basis in accordance with generally accepted
accounting principles.
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"DEBT" of the Operating Partnership or any subsidiary means any indebtedness
of the Operating Partnership and its subsidiaries, whether or not contingent, in
respect of:
(1) borrowed money evidenced by bonds, notes, debentures or similar
instruments;
(2) indebtedness secured by any mortgage, pledge, lien, charge, encumbrance
or any security interest existing on property owned by the Operating
Partnership and its subsidiaries;
(3) the reimbursement obligations, contingent or otherwise, in connection
with any letters of credit actually issued or amounts representing the
balance deferred and unpaid of the purchase price of any property except
any such balance that constitutes an accrued expense or trade payable;
(4) any lease of property by the Operating Partnership and its subsidiaries
as lessee which is reflected in the Operating Partnership's consolidated
balance sheet as a capitalized lease in accordance with generally
accepted accounting principles; or
(5) to the extent not otherwise included, any obligation by the Operating
Partnership or any subsidiary to be liable for, or to pay, as obligor,
guarantor or otherwise (other than for purposes of collection in the
ordinary course of business), indebtedness of another person other than
the Operating Partnership or any subsidiary,
in the case of items of indebtedness under (1) through (3) above to the extent
that any such items (other than letters of credit) would appear as a liability
on the Operating Partnership's consolidated balance sheet in accordance with
generally accepted accounting principles.
"TOTAL ASSETS" as of any date means the sum of:
- the Operating Partnership's and its subsidiaries' Undepreciated Real
Estate Assets; and
- all other assets of the Operating Partnership and its subsidiaries on a
consolidated basis determined in accordance with generally accepted
accounting principles, but excluding intangibles and accounts receivable.
"TOTAL UNENCUMBERED ASSETS" means the sum of:
- those Undepreciated Real Estate Assets not subject to an encumbrance; and
- all other assets of the Operating Partnership and its subsidiaries not
subject to an encumbrance determined in accordance with generally accepted
accounting principles, but excluding accounts receivable and intangibles.
"UNDEPRECIATED REAL ESTATE ASSETS" as of any date means the original cost
plus capital improvements of real estate assets of the Operating Partnership and
its subsidiaries on such date, before depreciation and amortization, determined
on a consolidated basis in accordance with generally accepted accounting
principles.
CERTAIN ADDITIONAL COVENANTS
EXISTENCE. Except as permitted under "-- Merger, Consolidation or Sale,"
the Operating Partnership is required to do or cause to be done all things
necessary to preserve and keep in full force and effect its existence, rights
and franchises. The Operating Partnership is not, however, required to preserve
any right or franchise if it determines that its preservation is no longer
desirable in the conduct of its business and that its loss is not
disadvantageous in any material respect to the holders of the debt securities.
MAINTENANCE OF PROPERTIES. The Operating Partnership is required to cause
all of its material properties used or useful in the conduct of its business or
the business of any subsidiary to be
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maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and to cause to be made all necessary repairs,
renewals, replacements, betterments and improvements, all as in the judgment of
the Operating Partnership may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times.
The Operating Partnership and its subsidiaries are not, however, prevented from
selling or otherwise disposing for value their respective properties in the
ordinary course of business.
INSURANCE. The Operating Partnership is required to, and is required to
cause each of its subsidiaries to, keep all of its insurable properties insured
against loss or damage at least equal to their then full insurable value with
financially sound and reputable insurance companies.
PAYMENT OF TAXES AND OTHER CLAIMS. The Operating Partnership is required to
pay or discharge or cause to be paid or discharged, before they become
delinquent:
(1) all taxes, assessments and governmental charges levied or imposed upon
it or any subsidiary or upon its income, profits or property or that of
any subsidiary, and
(2) all lawful claims for labor, materials and supplies which, if unpaid,
might by law become a lien upon the property of the Operating Partnership
or any subsidiary;
The Operating Partnership is not, however, required to pay or discharge or cause
to be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.
PROVISION OF FINANCIAL INFORMATION. The Operating Partnership will provide
the holders of debt securities with copies of the annual reports and quarterly
reports of the Operating Partnership. Whether or not the Operating Partnership
is subject to Section 13 or 15(d) of the Exchange Act and for so long as any
debt securities are outstanding, the Operating Partnership will, to the extent
permitted under the Exchange Act, be required to file with the SEC the annual
reports, quarterly reports and other documents which the Operating Partnership
would have been required to file with the SEC pursuant to such Section 13 or
15(d) if the Operating Partnership were so subject, such documents to be filed
with the SEC on or prior to the respective dates by which the Operating
Partnership would have been required so to file such documents if the Operating
Partnership were so subject. The Operating Partnership will also in any event:
- within 15 days of each required filing date:
- transmit by mail to all holders of debt securities, as their names and
addresses appear in the security register, without cost to such
holders, copies of the annual reports and quarterly reports which the
Operating Partnership would have been required to file with the SEC
pursuant to Section 13 or 15(d) of the Exchange Act if the Operating
Partnership were subject to such sections; and
- file with the trustee copies of the annual reports, quarterly reports
and other documents which the Operating Partnership would have been
required to file with the SEC pursuant to Section 13 or 15(d) of the
Exchange Act if the Operating Partnership were subject to such
sections; and
- if filing such documents by the Operating Partnership with the SEC is not
permitted under the Exchange Act, promptly upon written request and
payment of the reasonable cost of duplication and delivery, supply copies
of such documents to any prospective holder.
ADDITIONAL COVENANTS. Any additional or different covenants of the
Operating Partnership with respect to any series of debt securities will be set
forth in the prospectus supplement for such debt securities.
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Compliance with the financial covenants and additional covenants described
in this prospectus may not be waived by the board of directors of Duke, as
general partner of the Operating Partnership, or by the trustee unless the
holders of at least a majority in principal amount of all outstanding debt
securities of each applicable series consent to such waiver, except to the
extent the defeasance and covenant defeasance provisions of the indenture apply
to the debt securities.
EVENTS OF DEFAULT, NOTICE AND WAIVER
The indenture provides that the following events are "events of default"
with respect to any series of debt securities issued under the indenture:
(1) default for 30 days in the payment of any installment of interest on any
debt security of such series;
(2) default in the payment of the principal or any premium on any debt
security of such series at its maturity;
(3) default in making any sinking fund payment as required for any debt
security of such series;
(4) default in the performance of any other covenant of the Operating
Partnership contained in the indenture other than a covenant added to the
indenture solely for the benefit of a series of debt securities issued
under the indenture other than such series, and the continuation of such
default for 60 days after written notice as provided in the indenture;
(5) default in the payment of an aggregate principal amount exceeding
$5,000,000 of any evidence of recourse indebtedness of the Operating
Partnership or any mortgage, indenture or other instrument under which
such indebtedness is issued or by which such indebtedness is secured, if
such default occurred after the expiration of any applicable grace period
and resulted in the acceleration of the maturity of such indebtedness,
but only if such indebtedness is not discharged or such acceleration is
not rescinded or annulled;
(6) certain events of bankruptcy, insolvency or reorganization, or court
appointment of a receiver, liquidator or trustee of the Operating
Partnership or any significant subsidiary (as defined in Regulation S-X
promulgated under the Securities Act) or any of their respective
property; and
(7) any other event of default provided with respect to a particular series
of debt securities
If an event of default occurs and continues, the trustee or the holders of
at least 25% in principal amount of the outstanding debt securities of that
series may declare the principal amount of all of the debt securities of that
series to be due and payable immediately. If the debt securities of that series
are original issue discount securities or indexed securities, the applicable
prospectus supplement will describe the portion of the principal amount required
to make such a declaration. If this happens and the Operating Partnership cures
the default, under certain circumstances the holders of at least a majority in
principal amount of outstanding debt securities of that series can void the
acceleration.
The indenture also provides that the holders of at least a majority in
principal amount of the outstanding debt securities of a series may waive any
past default with respect to that series, except a default in payment or a
default of a covenant or other indenture provision that cannot be modified
without the consent of the holder of each outstanding debt security affected.
The indenture provides that no holders of debt securities of any series may
institute any judicial or other proceedings with respect to the indenture or for
any remedy under the indenture, except in the case of failure of the trustee to
act for 60 days after it has received a written request to institute proceedings
for an event of default from the holders of at least 25% in principal amount of
the outstanding debt securities of that series and an offer of indemnity
reasonably satisfactory to it. This
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provision will not prevent, however, any holder of debt securities from
instituting suit for the enforcement of any payment due on the debt securities.
Subject to provisions in the indenture relating to its duties in case of
default, the trustee is under no obligation to exercise any of its rights or
powers under the indenture at the request or direction of any holders of debt
securities, unless such holders offer to the trustee reasonable security or
indemnity. The holders of at least a majority in principal amount of the
outstanding debt securities of a series (or of all debt securities then
outstanding under the indenture, if applicable) have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the trustee, or of exercising any trust or power conferred upon the trustee.
However, the trustee may refuse to follow any direction which is in conflict
with any law or the indenture, which may involve the trustee in personal
liability or which may be unduly prejudicial to the holders of debt securities
not joining in the direction.
The indenture requires the Operating Partnership to file annually with the
trustee an officer's certificate as to the absence of defaults under the
indenture. The trustee is required to give notice to the holders of a series of
debt securities within 90 days of a default under the indenture unless the
default has been cured or waived. However, if the trustee considers it to be in
the interest of the holders, the trustee may withhold notice of any default
except a payment default.
MODIFICATION OF THE INDENTURE
At least a majority in principal amount of all outstanding debt securities
or series of outstanding debt securities affected by a modification or amendment
of the indenture is permitted to modify or amend the indenture. However,
modifications that have the following effects can only be made with the consent
of the holder of each of the debt securities affected by the modification:
- change the stated maturity of the principal of, or any premium or any
installment of interest on any debt security;
- reduce the principal amount of, or the rate or amount of interest on, or
any premium payable on redemption of, any debt security, or adversely
affect any right of repayment of the holder of any debt security;
- change the place of payment, or the coin or currency, for payment of
principal of, interest or any premium on any debt security;
- impair the right to institute suit for the enforcement of any payment on
or with respect to any debt security;
- reduce the percentage of outstanding debt securities of a series necessary
to modify or amend the indenture, to waive compliance with certain
provisions of the indenture or certain defaults and consequences under the
indenture or to reduce the quorum or voting requirements set forth in the
indenture; or
- modify any of the foregoing provisions or any of the provisions relating
to the waiver of certain past defaults or certain covenants, except to
increase the required percentage to effect such action or to provide that
certain other provisions may not be modified or waived without the consent
of the holder of a debt security.
The indenture provides that the holders of at least a majority in principal
amount of a series of debt securities have the right to waive compliance by the
Operating Partnership with certain covenants relating to such series of debt
securities in the indenture.
The Operating Partnership and the trustee can modify the indenture without
the consent of any holder of debt securities for any of the following purposes:
- to evidence the succession of another person to the Operating Partnership
as obligor under the indenture;
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- to add to the covenants of the Operating Partnership for the benefit of
the holders of all or any series of debt securities or to surrender any
right or power conferred upon the Operating Partnership in the indenture;
- to add events of default for the benefit of the holders of all or any
series of debt securities;
- to add or change any provisions of the indenture to facilitate the
issuance of, or to liberalize certain terms of, debt securities in bearer
form, or to permit or facilitate the issuance of debt securities in
uncertificated form, so long as it does not adversely affect the interests
of the holders of the debt securities of any series in any material
respect;
- to change or eliminate any provisions of the indenture, so long as any
such change or elimination becomes effective only when there are no debt
securities outstanding of any series previously created which are entitled
to the benefit of those provisions;
- to secure the debt securities;
- to establish the form or terms of debt securities of any series;
- to provide for the acceptance of appointment by a successor trustee or
facilitate the administration of the trusts under the indenture by more
than one trustee;
- to cure any ambiguity, defect or inconsistency in the indenture, so long
as such action does not adversely affect the interests of holders of debt
securities of any series in any material respect; or
- to supplement any of the provisions of the indenture to the extent
necessary to permit or facilitate defeasance and discharge of any series
of such debt securities, so long as such action does not adversely affect
the interests of the holders of the debt securities of any series in any
material respect.
The indenture provides that in determining whether the holders of the
requisite principal amount of outstanding debt securities of a series have given
any request, demand, authorization, direction, notice, consent or waiver or
whether a quorum is present at a meeting of holders of debt securities:
- the principal amount of an original issue discount security that is deemed
to be outstanding is the amount of its principal that would be due and
payable as of the date of such determination upon acceleration of
maturity;
- the principal amount of a debt security denominated in a foreign currency
that is deemed outstanding is the U.S. dollar equivalent of the principal
amount, determined on the issue date for such debt security, or, in the
case of an original issue discount security, the U.S. dollar equivalent on
the issue date of such debt security of the its principal that would be
due and payable as of the date of such determination upon acceleration of
maturity;
- the principal amount of an indexed security that is deemed outstanding is
the principal face amount of such indexed security at original issuance,
unless otherwise provided with respect to such indexed security pursuant
to the indenture, and
- debt securities owned by the Operating Partnership or any affiliate of the
Operating Partnership will be disregarded.
The indenture contains provisions for convening meetings of the holders of
debt securities of a series. The trustee, the Operating Partnership or the
holders of at least 10% in principal amount of the outstanding debt securities
of a series can call a meeting by giving notice as provided in the indenture.
Except for any consent that must be given by the holder of each debt security
affected by certain modifications of the indenture, any resolution presented at
a meeting or adjourned meeting duly reconvened at which a quorum is present will
be permitted to be adopted by the affirmative vote of the holders of a majority
in principal amount of the outstanding debt securities of that series. However,
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except as referred to above, any resolution with respect to any request, demand,
authorization, direction, notice, consent, waiver or other action that may be
made, given or taken by the holders of a specified percentage less than a
majority in principal amount of the outstanding debt securities of a series may
be adopted at a meeting or adjourned meeting duly reconvened at which a quorum
is present by the affirmative vote of the holders of such specified percentage
in principal amount of the outstanding debt securities of that series. Any
resolution passed or decision taken at any meeting of holders of a series of
debt securities duly held in accordance with the indenture will be binding on
all holders of debt securities of that series. The quorum at any meeting called
to adopt a resolution, and at any reconvened meeting, will be persons holding or
representing a majority in principal amount of the outstanding debt securities
of a series. However, if any action is to be taken at such a meeting with
respect to a consent or waiver which may be given by the holders of not less
than a specified percentage in principal amount of the outstanding debt
securities of the series, the persons holding or representing such specified
percentage in principal amount of the outstanding debt securities of the series
will constitute a quorum.
Notwithstanding the foregoing provisions, if any action is to be taken at a
meeting of holders of debt securities of a series with respect to any request,
demand, authorization, direction, notice, consent, waiver or other action that
the indenture expressly provides may be made, given or taken by the holders of a
specified percentage in principal amount of all outstanding debt securities of
the series affected thereby, or of the holders of such series and one or more
additional series of debt securities:
- there will be no minimum quorum requirement for such meeting; and
- the principal amount of the outstanding debt securities of such series
that vote in favor of such request, demand, authorization, direction,
notice, consent, waiver or other action will be taken into account in
determining whether such request, demand, authorization, direction,
notice, consent, waiver or other action has been made, given or taken
under the indenture.
DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
The Operating Partnership may discharge certain obligations to holders of
any series of debt securities that have not already been delivered to the
trustee for cancellation and that either have become due and payable or will
become due and payable within one year or scheduled for redemption within one
year by irrevocably depositing with the trustee, in trust, funds in such
currency in which such debt securities are payable in an amount sufficient to
pay the entire indebtedness on such debt securities in respect of principal,
interest and any premium to the stated maturity or redemption date or, if the
debt securities have become due and payable, the date of the deposit.
The Operating Partnership may elect either:
- to defease and be discharged from any and all obligations with respect to
such debt securities (except for the obligation to pay additional amounts,
if any, upon the occurrence of certain events of tax, assessment or
governmental charge with respect to payments on such debt securities and
the obligations to register the transfer or exchange of such debt
securities, to replace temporary or mutilated, destroyed, lost or stolen
debt securities, to maintain an office or agency in respect of such debt
securities and to hold moneys for payment in trust) ("defeasance"); or
- to be released from its obligations with respect to such debt securities
under the indenture, including any covenant, and any omission to comply
with such obligations will not constitute a default or an event of default
with respect to such debt securities ("covenant defeasance"),
In order to make this election, the Operating Partnership must make an
irrevocable deposit with the trustee which will provide money in an amount
sufficient to pay the principal, interest and any premium on such debt
securities, and any mandatory sinking fund or analogous payments on the debt
securities, on the scheduled due dates. The deposit may be either an amount in
the currency in which
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such debt securities are payable at stated maturity, or Government Obligations
(as defined below), or both.
"GOVERNMENT OBLIGATIONS" means securities which are:
- direct obligations of the United States of America or the government which
issued the foreign currency in which the debt securities of a particular
series are payable, for the payment of which its full faith and credit is
pledged, and which are not callable or redeemable at the option of the
issuer;
- obligations of a person controlled or supervised by and acting as an
agency or instrumentality of the United States of America or such
government which issued the foreign currency in which the debt securities
of such series are payable, the payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States of
America or such other government, and which are not callable or redeemable
at the option of the issuer; or
- depository receipts issued by a bank or trust company as custodian with
respect to any such Government Obligation described above or a specific
payment of interest on or principal of any such Government Obligation held
by such custodian for the account of the holder of a depository receipt,
so long as such custodian is not authorized to make any deduction from the
amount payable to the holder of such depository receipt from any amount
received by the custodian in respect of the Government Obligation or the
specific payment of interest on or principal of the Government Obligation
evidenced by such depository receipts, except as required by law.
Unless otherwise provided in the applicable prospectus supplement, if after
the Operating Partnership has deposited funds and/or Government Obligations to
effect defeasance or covenant defeasance with respect to debt securities of any
series:
- the holder of a debt security of such series is entitled to, and does,
elect pursuant to the indenture or the terms of such debt security to
receive payment in a currency other than that in which such deposit has
been made in respect of such debt security; or
- a Conversion Event (as defined below) occurs in respect of the currency in
which such deposit has been made,
the indebtedness represented by such debt security shall be deemed to have been,
and will be, fully discharged and satisfied through the payment of the
principal, interest and any premium on such debt security as they become due out
of the proceeds yielded by converting the amount so deposited in respect of such
debt security into the currency in which such debt security becomes payable as a
result of such election or such Conversion Event based on the applicable market
exchange rate.
"CONVERSION EVENT" means the cessation of use of:
- a currency both by the government of the country which issued such
currency and for the settlement of transactions by a central bank or other
public institutions of or within the international banking community;
- the ECU both within the European Monetary System and for the settlement of
transactions by public institutions of or within the European Community;
or
- any currency unit or composite currency other than the ECU for the
purposes for which it was established.
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In the event the Operating Partnership effects covenant defeasance with
respect to any debt securities and such debt securities are declared due and
payable because of the occurrence of any event of default still applicable to
such debt securities, the amount in such currency in which such debt securities
are payable, and Government Obligations on deposit with the trustee, will be
sufficient to pay amounts due on such debt securities at the time of their
stated maturity but may not be sufficient to pay amounts due on such debt
securities at the time of the acceleration resulting from such event of default.
However, the Operating Partnership would remain liable to make payment of such
amounts due at the time of acceleration.
The applicable prospectus supplement may further describe the provisions, if
any, permitting such defeasance or covenant defeasance, including any
modifications to the provisions described above, with respect to the debt
securities of or within a particular series.
NO CONVERSION RIGHTS
The debt securities will not be convertible into or exchangeable for any
capital stock of Duke or equity interest in the Operating Partnership.
BOOK-ENTRY DEBT SECURITIES
The debt securities of a series may be issued in whole or in part in the
form of one or more global securities that will be deposited with, or on behalf
of, a depositary identified in the applicable prospectus supplement. Global
securities may be issued in either registered or bearer form and in either
temporary or permanent form. Payments of principal, interest and any premium on
a series of debt securities represented by a global security will be made to the
depositary.
We anticipate that any global securities will be deposited with, or on
behalf of, The Depository Trust Company, New York, New York, that the global
securities will be registered in the name of DTC's nominee, and that the
following provisions will apply to the depository arrangements with respect to
the global securities. The prospectus supplement will describe additional or
differing terms of the depository arrangement involving any series of debt
securities issued in the form of global securities.
So long as DTC or its nominee is the registered owner of a global security,
DTC or its nominee will be considered the sole holder of the debt securities
represented by the global security for all purposes under the indenture. Except
as described below, owners of beneficial interests in a global security:
- will not be entitled to have debt securities represented by the global
security registered in their names;
- will not receive or be entitled to receive physical delivery of debt
securities in the form of a certificate; and
- will not be considered the record owners or holders of debt securities
under the.
The laws of some states require that purchasers of securities take physical
delivery of the securities in certificated form. These laws may limit the
transferability of beneficial interests in a global security.
Debt securities represented by a global security will be exchangeable for
debt securities in certificated form with the same terms in authorized
denominations only if:
- DTC notifies us that is unwilling or unable to continue as depository or
if DTC ceases to be a clearing agency registered under applicable law and
the Operating Partnership does not appoint a successor depository within
90 days;
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- an event of default under the indenture with respect to the debt
securities has occurred and is continuing and the beneficial owners
representing a majority in principal amount of the debt securities
represented by the global security advise DTC to cease acting as
depository; or
- the Operating Partnership determines at any time that all debt securities
of a series will no longer be represented by a global security.
We obtained the following information concerning DTC and its book-entry
system from sources, including DTC, that we believe to be reliable, but we take
no responsibility for the accuracy of this information.
DTC will act as securities depository for the debt securities. The debt
securities will be issued as fully registered securities registered in the name
of Cede & Co., which is DTC's partnership nominee.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Commercial Code, and a "clearing agency" registered
pursuant to the provisions of Section 17A of the Securities Exchange Act. DTC
holds securities that its participants deposit with DTC. DTC also facilitates
the settlement among participants of securities transactions, including
transfers and pledges, in deposited securities through electronic computerized
book-entry changes in participants' accounts, thereby eliminating the need for
physical movement of securities certificates. Direct participants of DTC include
securities brokers and dealers, banks, trust companies, clearing corporations
and other organizations. A number of the direct participants and the New York
Stock Exchange, the American Stock Exchange, and the National Association of
Securities Dealers own DTC. Access to DTC's system also is available to others,
including securities brokers and dealers and banks and trust companies that
clear through or maintain a custodial relationship with a direct participant,
either directly or indirectly. The rules applicable to DTC and its participants
are on file with the SEC.
Purchases of debt securities under the DTC system must be made by or through
direct participants, which will receive a credit for the debt securities on
DTC's records. The ownership interest of each beneficial owner or each actual
purchaser of each debt security is to be recorded on the direct and indirect
participants' records. A beneficial owner of debt securities will not receive
written confirmation from DTC of its purchase, but is expected to receive a
written confirmation providing details of the transaction, as well as periodic
statements of its holdings, from the participant through which the beneficial
owner entered into the transaction. Transfers of ownership interests in debt
securities are to be accomplished by entries made on the books of participants
acting on behalf of beneficial owners. Beneficial owners will not receive
certificates representing their ownership interests in the debt securities,
unless the use of the book-entry system for the debt securities is discontinued.
To facilitate subsequent transfers, any certificate representing debt
securities which is deposited with, or on behalf of, DTC is registered in the
name of its nominee, Cede & Co. The deposit of the certificate with, or on
behalf of, DTC and its registration in the name of Cede & Co. effect no change
in beneficial ownership. DTC has no knowledge of the actual beneficial owners of
the certificate representing the debt securities. DTC's records reflect only the
identity of the direct participants to whose accounts the debt securities are
credited, which may or may not be the beneficial owners. The participants will
remain responsible for keeping account of their holdings on behalf of their
customers.
Delivery of notices and other communications by DTC to direct participants,
by direct participants to indirect participants, and by direct and indirect
participants to beneficial owners, will be governed by arrangements among them
and any statutory or regulatory requirements.
Neither DTC nor Cede & Co. will consent or vote with respect to the debt
securities. Under its usual procedures, DTC mails an omnibus proxy to the
Operating Partnership as soon as possible after the record date. The omnibus
proxy assigns Cede & Co.'s consenting or voting rights to those direct
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participants identified on a list attached to the omnibus proxy to whose
accounts the debt securities are credited on the record date.
Principal, interest and any premium payments on the debt securities will be
made to DTC. DTC's practice is to credit direct participants' accounts on the
payable date with respect to their holdings as shown on DTC's records unless DTC
has reason to believe that it will not receive payment on the payment date.
Payments by participants to beneficial owners will be governed by standing
instructions and customary practices, as is the case with securities held for
the accounts of customers in bearer form or registered in "street name," and
will be the responsibility of the participant and not of DTC, the trustee, or
the paying agent, subject to any statutory or regulatory requirements. Payment
of principal and interest to DTC is the responsibility of the Operating
Partnership or the trustee or any paying agent. Disbursement of payments to
direct participants will be the responsibility of DTC. Disbursement of payments
to the beneficial owners will be the responsibility of the direct and indirect
participants.
If applicable, redemption notices will be sent to Cede & Co. If less than
all of the debt securities within an issue are being redeemed, DTC's practice is
to determine by lot the amount of the interest of each direct participant in the
issue to be redeemed.
A beneficial owner will give notice of any option to elect to have its debt
securities repaid by the Operating Partnership, through its participant, to the
trustee, and will effect delivery of the debt securities by causing the direct
participant to transfer the participant's interest in the global security or
securities representing the debt securities, on DTC's records, to the trustee.
The requirement for physical delivery of debt securities in connection with a
demand for repayment will be deemed satisfied when the ownership rights in the
global security or securities representing the debt securities are transferred
by direct participants on DTC's records.
DTC may discontinue providing its services as securities depository with
respect to a series of debt securities at any time by giving reasonable notice
to the Operating Partnership or the paying agent. If a successor securities
depository is not appointed, debt security certificates are required to be
printed and delivered.
The Operating Partnership may decide to discontinue use of the system of
book-entry transfers through DTC or a successor securities depository. In that
event, debt security certificates will be printed and delivered.
Unless stated otherwise in the applicable prospectus supplement, any
underwriters, dealers or agents with respect to any series of debt securities
issued as global securities will be direct participants in DTC.
None of the Operating Partnership, Duke, any underwriter, dealer or agent,
the trustee or any paying agent will have any responsibility or liability for
any aspect of the records relating to or payments made on account of beneficial
interests in a global security, or for maintaining, supervising or reviewing any
records relating to these beneficial interests.
Any additional or different terms of the depositary arrangement with respect
to a series of debt securities will be described in the applicable prospectus
supplement relating to such series.
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DESCRIPTION OF PREFERRED STOCK
GENERAL
Under Duke's articles of incorporation, its board of directors is authorized
to issue up to 5,000,000 shares of preferred stock with a par value of $.01 per
share in one or more series and with rights, preferences, privileges and
restrictions that they may fix or designate without any further vote or action
by Duke's stockholders. As of March 31, 2000, Duke's board of directors had
created the following series of preferred stock:
- 9.10% Series A Cumulative Redeemable Preferred Stock, of which 300,000
shares are authorized and outstanding;
- 7.99% Series B Cumulative Step-Up Premium Rate Preferred Stock, of which
300,000 shares are authorized and outstanding;
- Series C Junior Preferred Stock, of which 500,000 shares are authorized
but none are outstanding;
- 7.375% Series D Convertible Cumulative Redeemable Preferred Stock, of
which 540,000 shares are authorized and outstanding;
- 8.25% Series E Cumulative Redeemable Preferred Stock, of which 460,000
shares are authorized and outstanding;
- 8.00% Series F Cumulative Redeemable Preferred Stock, of which 7,400
shares are authorized and 6,000 shares are outstanding; and
- 8.625% Series H Cumulative Redeemable Preferred Stock, of which 2,600
shares are authorized and none are outstanding.
The following description of preferred stock sets forth general terms and
provisions of any series of preferred stock which Duke's board of directors may
create. The applicable prospectus supplement will describe the specific terms of
a particular series of preferred stock, which may differ from the following
terms. The descriptions of preferred stock in this prospectus and in any
applicable prospectus supplement are qualified in their entirety by reference to
Duke's articles of incorporation and any applicable amendments, which are filed
or incorporated by reference as an exhibit to the registration statement of
which this prospectus is a part.
TERMS
When preferred stock is issued by Duke, it will be fully paid, and Duke will
not be entitled to assess the holders of the preferred stock. The preferred
stock will not have pre-emptive rights.
The specific terms of any series of preferred stock being offered will be
contained in a prospectus supplement, including:
- the title and stated value of the preferred stock;
- the number of shares, their liquidation preference per share and their
purchase price;
- the dividend rate, dividend periods and payment dates or methods of
calculating the payment dates;
- the date on which dividends begin to accrue or accumulate;
- whether the dividends will be cumulative, and any dividend preference;
- the procedures for any auction and remarketing of the preferred stock;
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- any retirement or sinking fund requirement;
- the price and the terms and conditions of any redemption;
- the price and the terms and conditions of any conversion or exchange into
Duke's common stock;
- any listing of the preferred stock on any securities exchange;
- whether interests in the preferred stock will be represented by depositary
shares;
- any voting rights of the series;
- the relative ranking and preferences as to dividends and rights upon
liquidation, dissolution or winding up;
- any limitations on issuing any series of preferred stock ranking senior to
or on a parity with the series of preferred stock as to dividends,
liquidation, dissolution or winding up;
- any limitations on direct or beneficial ownership and restrictions on
transfer; and
- any other specific terms, preferences, rights, limitations or restrictions
of the preferred stock;
RANK
Unless otherwise specified in the prospectus supplement, the preferred stock
will have the following ranking as to dividends, liquidation, dissolution or the
winding up of Duke's affairs:
- senior to all classes or series of Duke's common stock and to all equity
securities ranking junior to such preferred stock;
- on a parity with all equity securities Duke issues, the terms of which
specifically provide that such equity securities rank on a parity with the
preferred stock; and
- junior to all equity securities Duke issues, the terms of which
specifically provide that such equity securities rank senior to the
preferred stock. The term "equity securities" does not include convertible
debt securities.
DIVIDENDS
Preferred stockholders of each series will be entitled to receive cash
dividends, if, as and when approved by Duke's board of directors, out of Duke's
assets legally available for payment to stockholders. The prospectus supplement
will list the applicable dividend rates and distribution dates. Duke will pay
each dividend to shareholders of record according to Duke's share transfer books
on the record date fixed by Duke's board of directors.
The applicable prospectus supplement will specify whether dividends on a
preferred stock series are cumulative or non-cumulative. If dividends are
cumulative, they will accumulate from the date listed in the prospectus
supplement. If dividends are non-cumulative and Duke's board of directors does
not declare a dividend payable on a dividend payment date, then the preferred
stockholders of that series will have no right to receive a dividend, and Duke
will have no obligation to pay an accrued dividend later for the missed dividend
period, whether or not dividends on the series are declared on any future date.
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If preferred stock of a series is outstanding, Duke will not declare or pay
dividends on any other series of its capital stock ranking on a parity with or
junior to those shares as to dividends for any period unless:
- if the series of preferred stock has cumulative dividends, full cumulative
dividends for all past and current dividend periods for the series must
have been declared and paid or declared and funds reserved for payment
before or at the same time as the declaration and payment on the junior
series; or
- if the series of preferred stock does not have cumulative dividends, full
dividends for the current dividend period for the series must have been
declared and paid or declared and funds reserved for payment before or at
the same time as the declaration and payment on the junior series.
When dividends on shares from more than one series of preferred stock
ranking in parity as to dividends are not paid in full (or a sufficient sum for
full payment has not been set apart), all such dividends will be declared pro
rata so that the amount of dividends declared per share in each such series will
in all cases bear the same ratio of accrued dividends owed. Such pro rata
payments per share will not include interest, nor will it include any
accumulated unpaid dividends from prior periods if the dividends in question are
non-cumulative.
Except as provided in the preceding paragraph, Duke will not declare or pay
dividends on, or redeem , purchase or otherwise acquire any shares of, its
common stock or any capital stock ranking junior to a series of preferred stock
(other than dividends paid in or conversions or exchanges for common stock or
other capital stock junior to the preferred stock) unless:
- if the series of preferred stock has cumulative dividends, full cumulative
dividends for all past and current dividend periods for the series must
have been declared and paid or declared and funds reserved for payment
before or at the same time as the declaration and payment on the junior
series; or
- if the series of preferred stock does not have cumulative dividends, full
dividends for the current dividend period for the series must have been
declared and paid or declared and funds reserved for payment before or at
the same time as the declaration and payment on the junior series.
REDEMPTION
If specified in the applicable prospectus supplement, Duke will have the
right to redeem all or any part of the preferred stock in each series at its
option, or the preferred stock will be subject to mandatory redemption.
If the series of preferred stock is subject to mandatory redemption, the
prospectus supplement will specify:
- the number of shares Duke will redeem in each year;
- the date when Duke will commence the redemption; and
- the redemption price per share, which will include all accrued and unpaid
dividends other than non-cumulative dividends for prior dividend periods.
The redemption price may be payable in cash or other property. If the
redemption price for a series of preferred stock is payable only from the net
proceeds of the issuance of Duke's capital shares, the terms of the series may
provide that if no such capital shares have been issued or the net proceeds are
insufficient to pay the full aggregate redemption price, then the preferred
stock will automatically and mandatorily convert into the applicable capital
shares pursuant to conversion provisions specified in the prospectus supplement.
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Notwithstanding the foregoing, Duke will not redeem, purchase or acquire any
shares of a series of preferred stock (other than conversions or exchanges for
common stock or other capital stock junior to the preferred stock) unless:
- in the case of a redemption, all shares of the series of preferred stock
are simultaneously redeemed;
- if the series of preferred stock has cumulative dividends, full cumulative
dividends for all past and current dividend periods for the series must
have been declared and paid or declared and funds reserved for payment; or
- if the series of preferred stock does not have cumulative dividends, full
dividends for the current dividend period for the series must have been
declared and paid or declared and funds reserved for payment.
Duke may, however, purchase or acquire preferred stock of any series to preserve
its status as a REIT or pursuant to an offer made on the same terms to all
holders of preferred stock of that series.
If Duke redeems fewer than all outstanding shares of any series of preferred
stock, it will determine the number of shares to be redeemed and whether it will
redeem shares pro rata by shares held or shares requested to be redeemed, by lot
or in some other manner to be determined by Duke.
Duke will mail redemption notices at least 30 days, but not more than 60
days, before the redemption date to each holder of record of a series of
preferred stock to be redeemed at the address shown on the share transfer books.
Each notice will state:
- the redemption date;
- the number of shares and series of the preferred stock to be redeemed;
- the redemption price;
- the place or places where certificates for such preferred stock are to be
surrendered for payment of the redemption price;
- that dividends on the shares to be redeemed will cease to accrue on such
redemption date; and
- the date upon which the holder's conversion rights, if any, as to such
shares terminate.
If Duke redeems fewer than all outstanding shares of a series of preferred
stock, the notice will also specify the number of shares to be redeemed from
each shareholder. If Duke gives notice of redemption and has set aside the funds
necessary for the redemption in a trust for the benefit of holders of stock
being redeemed, then dividends will cease to accrue from the redemption date and
all rights of the holders of the stock to be redeemed will terminate, except the
right to receive the redemption price.
LIQUIDATION PREFERENCE
If Duke liquidates, dissolves or winds up its affairs, then holders of each
series of preferred stock will be entitled to receive out of Duke's legally
available assets a liquidating distribution in the amount of the liquidation
preference per share for that series as specified in the applicable prospectus
supplement, plus an amount equal to all dividends accrued and unpaid, but not
including amounts from prior periods for non-cumulative dividends, before Duke
makes any distributions to holders of its common stock or any other capital
shares ranking junior to the preferred stock.
Once holders of outstanding preferred stock receive their respective
liquidating distributions, they will have no right or claim to any of Duke's
remaining assets. In the event that Duke's assets are not sufficient to pay the
full liquidating distributions to the holders of all Duke's outstanding
preferred
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stock and all other classes or series of its capital shares ranking on a parity
with its preferred stock, then Duke will distribute its assets to those holders
in proportion to the full liquidating distributions to which they would
otherwise have been entitled.
After Duke has paid liquidating distributions in full to all holders of its
preferred stock, it will distribute its remaining assets among holders of any
other classes or series of capital shares ranking junior to the preferred stock
according to their respective rights and preferences and number of shares. For
this purpose, a consolidation or merger of Duke with any other corporation or
entity, or a sale, lease or conveyance of all or substantially all of Duke's
property or business is not considered a liquidation, dissolution or winding up
of Duke's affairs.
VOTING RIGHTS
Holders of preferred stock will not have any voting rights, except as
described in this section or specified in a prospectus supplement or as
otherwise required by law.
Whenever dividends on any shares of preferred stock have not been paid for
six or more consecutive quarterly periods, the holders of such preferred stock
are entitled to vote separately as a class with all other holders of preferred
stock on which such dividends have not been paid for the election of two
additional directors of Duke. The holders of record of at least 10% of any
series of preferred stock on which dividends have not been so paid are entitled
to call a special meeting to elect these additional directors unless Duke
receives the request less than 90 days before the date of the next annual or
special meeting of shareholders. Whether or not such a special meeting is
called, the holders of a series of preferred stock on which dividends have not
been so paid are entitled to vote for the additional directors at the next
annual meeting of shareholders and at each subsequent annual meeting until:
- if the series of preferred stock has a cumulative dividend, Duke has fully
paid all unpaid dividends on the shares for the past dividend periods and
the then current dividend period, or Duke has declared the unpaid
dividends and set apart a sufficient sum for their payment; or
- if the series of preferred stock does not have a cumulative dividend, Duke
has fully paid four consecutive quarterly dividends, or Duke has declared
such dividends and set apart a sufficient sum for their payment.
In any case in which the holders of preferred stock elect additional directors,
the number of directors on Duke's board of directors will be increased by two.
Unless the applicable prospectus supplement provides otherwise, the holders
of at least two-thirds of the shares of each series of preferred stock
outstanding must approve before Duke can take any of the following actions:
- authorize, create or increase the authorized or issued amount of any class
or series of capital stock ranking prior to such series of preferred stock
as to dividends or liquidation distributions;
- reclassify any authorized capital stock into shares ranking prior to such
series of preferred stock as to dividends or liquidation distributions;
- issue any obligation or security convertible into or evidencing the right
to purchase any shares ranking prior to such series of preferred stock as
to dividends or liquidation distributions; or
- amend, alter or repeal Duke's articles of incorporation (including the
provision establishing such series of preferred stock) whether by merger,
consolidation or other event, in a manner that materially and adversely
affects any right, preference, privilege or voting power of the preferred
stock, unless the preferred stock remains outstanding and its terms are
not materially changed, even if Duke is not the surviving entity in a
merger, consolidation or other event.
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The following events do not materially and adversely affect a series of
preferred stock for this purpose:
- an increase in the number of authorized shares of preferred stock;
- the creation or issuance of any other series of preferred stock; or
- an increase in the number of authorized shares in such series of preferred
stock or any other series of preferred stock ranking the same as or junior
to the preferred stock of such series as to dividends or liquidation
distributions.
The holders of a series of preferred stock will have no voting rights under
these provisions, however, if Duke redeems or calls for redemption all
outstanding shares of the series and deposits sufficient funds in a trust to
effect the redemption on or before the time the act occurs requiring the vote.
Under Indiana law, holders of each series of preferred stock are entitled to
vote as a class upon any proposed amendment to Duke's articles of incorporation,
if the amendment would:
- increase or decrease the aggregate number of authorized shares of such
series;
- effect an exchange or reclassification of all or part of the shares of the
series into shares of another series;
- effect an exchange or reclassification or create the right of exchange of
all or part of the shares of another class or series into shares of the
series;
- change the designation, rights, preferences or limitations of all or a
part of the shares of the series;
- change the shares of all or part of the series into a different number of
shares of the same series;
- create a new series having rights or preferences with respect to
distributions or dissolution that are prior, superior or substantially
equal to the shares of the series;
- increase the rights, preferences or number of authorized shares of any
class or series that, after giving effect to the amendment, have rights or
preferences with respect to distributions or to dissolution that are
prior, superior or substantially equal to the shares of the series;
- limit or deny an existing preemptive right of all or part of the shares of
the series; or
- cancel or otherwise affect rights to distributions or dividends that have
accumulated but have not yet been declared on all or part of the shares of
the series.
CONVERSION RIGHTS
You will find the terms and conditions, if any, upon which any series of
preferred stock is convertible into shares of common stock in the applicable
prospectus supplement, including:
- the number of shares of common stock into which the shares of preferred
stock are convertible;
- the conversion price or manner by which Duke will calculate the conversion
price;
- the conversion period;
- whether conversion will be at the option of the holders of the preferred
stock or Duke;
- the events requiring an adjustment of the conversion price; and
- provisions affecting conversion in the event of the redemption of such
series of preferred stock.
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SHAREHOLDER LIABILITY
Indiana law provides that no shareholder, including holders of preferred
stock, will be personally liable for Duke's acts and obligations and that Duke's
funds and property are the only recourse for its acts or obligations.
RESTRICTIONS ON OWNERSHIP
As discussed below under "Description of Common Stock -- Certain Provisions
Affecting Change of Control," for Duke to qualify as a REIT under the Internal
Revenue Code, not more than 50% in value of its outstanding capital shares may
be owned, directly or indirectly, by five or fewer individuals ( including
certain entities) during the last half of a taxable year. To assist it in
meeting this requirement, Duke may take certain actions to limit the direct or
indirect beneficial ownership by a single person of its outstanding equity
securities, including any of its preferred stock. Therefore, the amendment to
Duke's articles of incorporation creating a series of preferred stock may
contain provisions restricting the ownership and transfer of the preferred
stock. The applicable prospectus supplement will specify any additional
ownership limitation relating to a series of preferred stock.
REGISTRAR AND TRANSFER AGENT
The registrar and transfer agent for the preferred stock will be set forth
in the applicable prospectus supplement.
DESCRIPTION OF DEPOSITARY SHARES
GENERAL
Duke may issue receipts for depositary shares, each of which will represent
a fractional interest of a share of a particular series of preferred stock, as
specified in the applicable prospectus supplement. Shares of preferred stock of
each series represented by depositary shares will be deposited under a separate
deposit agreement among Duke, a depositary (a United States bank or trust
company having a combined capital and surplus of at least $50,000,000) and the
holders from time to time of the depositary receipts. Subject to the terms of
the applicable deposit agreement, each owner of a depositary receipt will be
entitled, in proportion to their respective fractional interests, to all the
rights and preferences of the preferred stock represented by such depositary
shares, including dividend, voting, conversion, redemption and liquidation
rights.
The depositary shares will be evidenced by depositary receipts issued under
the deposit agreement. Immediately after Duke issues and delivers its preferred
stock to a preferred stock depositary, it will issue, on its own behalf, the
depositary receipts. You may obtain copies of the applicable deposit agreement
and depositary receipts from Duke upon request.
The statements in this section are summaries of certain anticipated
provisions and are subject to, and qualified in their entirety by reference to,
all of the provisions of the applicable deposit agreement and related depositary
receipts.
DIVIDENDS AND OTHER DISTRIBUTIONS
The depositary will distribute all cash dividends or other cash
distributions on the preferred stock to the record holders of depositary shares
in proportion to the number of depositary receipts owned by such holders.
Holders of depositary shares have certain obligations to file proofs,
certificates and other information and to pay certain charges and expenses of
the depositary in connection with distributions.
If a distribution on the preferred shares is other than in cash and it is
feasible for the depositary to distribute the property it receives, the
depositary will distribute property it received to the record
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holders of depositary shares entitled to such property, subject to certain
obligations of holders to file proofs, certificates and other information and to
pay certain charges and expenses to the depositary. If such a distribution is
not feasible and Duke approves, the depositary may sell the property and
distribute the net proceeds from the sale to the holders of the depositary
shares.
The depositary will not make any distribution on any depositary share to the
extent that it represents preferred stock which has been converted or exchanged.
WITHDRAWAL OF STOCK
Unless depositary shares have previously been called for redemption or
converted, a holder of depositary shares is entitled to surrender the depositary
receipts at the corporate trust office of the depositary in exchange for whole
or fractional shares of the related preferred stock represented by the
depositary shares together with any money or other property represented by the
depositary shares, all as specified in the applicable prospectus supplement.
Once depositary shares have been so exchanged, the holder will not be entitled
to redeposit the preferred shares and receive depositary shares again. If a
depositary receipt presented for exchange into preferred stock represents more
shares of preferred stock than the number to be withdrawn, the depositary is
required to deliver a new depositary receipt for the excess number of depositary
shares.
REDEMPTION OF DEPOSITARY SHARES
Whenever Duke redeems shares of preferred stock held by a depositary, the
depositary will redeem on that same date the same number of depositary shares
representing the preferred stock redeemed, provided Duke paid in full to the
depositary the redemption price of the preferred shares plus an amount equal to
any accrued and unpaid dividends up to the date fixed for redemption. The
redemption price per depositary share will be equal to the applicable fraction
of the redemption price and any other amounts per share payable with respect to
the related preferred stock. If fewer than all the depositary shares are to be
redeemed, Duke and the depositary will select the depositary shares to be
redeemed as nearly pro rata as may be practicable without creating fractional
depositary shares or by any other equitable method determined by Duke that
preserves its REIT status.
On the redemption date:
- all dividends relating to the shares of preferred stock called for
redemption will cease to accrue;
- the depositary shares called for redemption will no longer be deemed
outstanding; and
- all rights of the holders of the depositary shares to be redeemed will
cease, except the right to receive any money payable upon the redemption
and any money or other property to which the holders of such depositary
shares are entitled upon redemption and surrender to the depositary.
VOTING OF THE PREFERRED STOCK
When a depositary receives notice regarding a meeting in which holders of
the related preferred stock are entitled to vote, it will mail that information
to the holders of depositary shares. Each record holder of depositary shares on
the record date will then be entitled to instruct the depositary to exercise its
voting rights for the amount of preferred stock represented by that holder's
depositary shares. The depositary will vote in accordance with these
instructions, and Duke will agree to take all reasonable action which the
depositary may deem necessary to enable the depositary to do so. The depositary
will abstain from voting to the extent it does not receive specific instructions
from holders of depositary shares. A depositary will not be responsible for any
failure to carry out any instruction to vote, or for the manner or effect of any
such vote made, as long as any such action or non-action is in good faith and
does not result from negligence or willful misconduct of the depositary.
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LIQUIDATION PREFERENCE
In the event of Duke's voluntary or involuntary liquidation, dissolution or
winding up, a holder of depositary shares will be entitled to the fraction
represented by the depositary shares of the liquidation preference of the
related preferred stock as set forth in the applicable prospectus supplement.
CONVERSION OF PREFERRED STOCK
Depositary shares will not themselves be convertible into common stock or
any other of Duke's securities or property. If the related preferred stock is
convertible, however, and it is specified in the applicable prospectus
supplement, holders of depositary shares may surrender them to the applicable
depositary with written instructions that Duke is to convert the preferred stock
represented by their depositary shares into whole shares of common stock, other
shares of Duke's preferred stock or other shares of stock, as applicable. Duke
will agree that upon receiving such instructions and any amounts payable in
connection with such a conversion, it will convert the preferred stock using the
same procedures as those provided for delivery of preferred stock. If the
depositary shares are to be converted in part only, the depositary will issue a
new depositary receipt for any depositary shares not converted. Duke will not
issue fractional shares of common stock upon conversion. If a conversion will
result in a fractional share being issued, Duke will pay an amount in cash equal
to the value of the fractional interest based upon the closing price of the
common stock on the last business day prior to the conversion.
AMENDMENT AND TERMINATION OF A DEPOSIT AGREEMENT
Duke and the depository may amend any form of depositary receipts evidencing
depositary shares and any provision of a deposit agreement. Unless the amendment
has been approved by the existing holders of at least two-thirds of the
applicable depositary shares then outstanding, however, Duke and the depositary
may not make any amendment that:
- would materially and adversely alter the rights of the holders of
depositary shares; or
- would be materially and adversely inconsistent with the rights granted to
the holders of the related preferred stock.
Subject to certain anticipated exceptions in the deposit agreements and
except in order to comply with the law, no amendment may impair the right of any
holders of depositary shares to surrender their depositary receipts with
instructions to deliver to the holders the related preferred stock and all money
and other property represented by the depositary shares. Every holder of an
outstanding depositary receipt at the time any such amendment becomes effective
who continues to hold the depositary receipt will be deemed to consent and agree
to the amendment and to be bound by the applicable amended deposit agreement.
Duke may terminate a deposit agreement upon not less than 30 days' prior
written notice to the applicable depositary if:
- the termination is necessary to preserve Duke's status as a REIT; or
- a majority of each series of preferred stock affected by the termination
consents to the termination.
Upon a termination of a deposit agreement, holders of the applicable depositary
shares are entitled to surrender their depositary shares and receive in exchange
the number of whole or fractional shares of preferred stock and any other
property represented by the depositary shares. Duke will agree that if a deposit
agreement is terminated to preserve its status as a REIT, then it will use its
best efforts to list the preferred stock issued upon surrender of the related
depositary shares on a national securities exchange.
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In addition, a deposit agreement will automatically terminate if:
- all outstanding depositary shares subject to the agreement have been
redeemed;
- there has been a final distribution of the related preferred stock in
connection with any liquidation, dissolution or winding up of Duke, and
the distribution has been distributed to the holders of the depositary
shares; or
- each share of the related preferred stock has been converted into Duke
stock not represented by depositary shares.
CHARGES OF A DEPOSITARY
Duke will pay all transfer and other taxes and governmental charges arising
solely from the existence of a deposit agreement. In addition, Duke will pay the
fees and expenses of a depositary in connection with the performance of its
duties under a deposit agreement. However, holders of depositary receipts will
pay the fees and expenses of a depositary for any duties requested by such
holders to be performed which are outside those expressly provided for in the
applicable deposit agreement.
RESIGNATION AND REMOVAL OF DEPOSITARY
A depositary may resign at any time by delivering to Duke notice of its
election to resign, and Duke may at any time remove a depositary. Any such
resignation or removal would take effect upon the appointment of a successor
depositary. Duke will appoint a successor depositary within 60 days after
delivery of the notice of resignation or removal. The successor must be a bank
or trust company with its principal office in the United States and a combined
capital and surplus of at least $50 million.
MISCELLANEOUS
A depositary will be required to forward to the holders of depositary shares
any reports and communications from Duke with respect to the related preferred
stock.
Neither a depositary nor Duke will be liable if it is prevented or delayed
by law or any circumstances beyond its control from performing its obligations
under a deposit agreement. The obligations of Duke and a depositary under a
deposit agreement will be limited to performing their duties in good faith and
without negligence in regard to voting of preferred stock, gross negligence or
willful misconduct. Neither Duke nor any applicable depositary will be obligated
to prosecute or defend any legal proceeding with respect to any depositary
receipts, depositary shares or shares of related preferred stock unless they are
furnished with satisfactory indemnity.
Duke and any depositary may rely on the written advice of counsel or
accountants, or information provided by persons presenting shares of preferred
stock for deposit, holders of depositary receipts or other persons they believe
in good faith to be competent to give such information, and on documents they
believe in good faith to be genuine and signed by a proper party.
In the event a depositary receives conflicting claims, requests or
instructions from any holders of depositary shares and Duke, the depositary will
be entitled to act on the claims, requests or instructions received from Duke.
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DESCRIPTION OF COMMON STOCK
GENERAL
Duke's authorized capital stock includes 250,000,000 shares of common stock,
$.01 par value per share. Each outstanding share of common stock entitles the
holder to one vote on all matters presented to shareholders for a vote. Holders
of common stock have no preemptive rights. As of March 31, 2000, there were
126,463,274 shares of common stock outstanding, 19,187,880 shares reserved for
issuance upon exchange of outstanding units and 5,865,475 shares reserved for
issuance upon the exercise of outstanding stock options.
Duke's shares of common stock currently outstanding are listed on the New
York Stock Exchange. Duke will apply to the NYSE to list additional shares of
common stock to be sold pursuant to any prospectus supplement, and Duke
anticipates that any such shares will be listed on the NYSE.
Duke's articles of incorporation provide for the board of directors to be
divided into three classes of directors, with each class containing as nearly as
possible one-third of the directors. The class of directors elected at each
annual shareholders' meeting will begin a three-year term, and the directors in
the other two classes will continue in office. These classified board provisions
in the articles of incorporation may make it more difficult to cause a change of
control of Duke or to remove incumbent management. Holders of common stock have
no right to cumulative voting for the election of directors. Consequently, at
each annual shareholders' meeting, the holders of a majority of the shares of
common stock voting are able to elect all of the successors of the class of
directors whose term expires at that meeting. Directors may be removed only for
cause and only with the affirmative vote of the holders of a majority of the
shares of common stock entitled to vote in the election of directors.
All shares of common stock issued will be duly authorized, fully paid, and
non-assessable. Distributions may be paid to the holders of common stock if and
when declared by Duke's board of directors out of funds legally available for
such distributions. Duke intends to continue to pay quarterly dividends.
Under Indiana law, shareholders are generally not liable for Duke's debts or
obligations. If Duke is liquidated, after payment or provision for all of Duke's
known debts and liabilities and any preferential distributions required to be
made to holders of preferred stock, each outstanding share of common stock will
be entitled to participate pro rata in the remaining assets.
CERTAIN PROVISIONS AFFECTING CHANGE OF CONTROL
GENERAL. Under Indiana law, shareholders holding a majority of the shares
voting must approve for Duke to merge with or sell all or substantially all of
its assets. Duke's articles of incorporation also contain provisions which may
discourage certain types of transactions involving an actual or threatened
change of control, including:
- a requirement that certain mergers, sales of assets, liquidations or
dissolutions, or reclassifications or recapitalizations involving persons
owning 10% or more of Duke's capital stock:
- be approved by a vote of the holders of 80% of the issued and
outstanding shares of Duke's capital stock; or
- be approved by three-fourths of the continuing directors; or
- provide for payment to shareholders for their shares of at least a
specified price;
- a requirement that any amendment or alteration of certain provisions of
the articles of incorporation affecting change of control be approved by
the holders of 80% of Duke's issued and outstanding capital stock; and
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- a classified board of directors and a limitation on removal of directors
to removal for cause as described above.
The partnership agreement for the Operating Partnership also contains
provisions which could discourage transactions involving an actual or threatened
change of control of Duke, including:
- a requirement that holders of at least 90% of the outstanding partnership
units held by Duke and other unit holders approve any voluntary sale,
exchange, merger, consolidation or other disposition of all or
substantially all of the assets of the Operating Partnership in one or
more transactions other than a disposition occurring upon a financing or
refinancing of the Operating Partnership;
- a restriction against any assignment or transfer by Duke of its interest
in the Operating Partnership; and
- a requirement that holders of more than 90% of the partnership units
approve:
- any merger, consolidation or other combination of Duke with another
entity, unless after the transaction substantially all of the assets of
the surviving entity are contributed to the Operating Partnership in
exchange for units;
- any sale of all or substantially all of Duke's assets; or
- any reclassification or recapitalization or change of outstanding
shares of common stock other than certain changes in par value, stock
splits, stock dividends or combinations.
Duke's directors who are not officers or employees and who do not hold
partnership units will vote on these matters.
OWNERSHIP LIMITS. For Duke to qualify as a REIT under the Internal Revenue
Code:
- no more than 50% in value of Duke's outstanding capital shares may be
owned, directly or indirectly, by five or fewer individuals (including
certain entities) during the last half of a taxable year or during a
proportionate part of a shorter taxable year; and
- Duke's common stock must be beneficially owned by 100 or more persons
during at least 335 days of a taxable year or during a proportionate part
of a shorter taxable year.
Because Duke expects to continue to qualify as a REIT, its articles of
incorporation contain restrictions on the acquisition of common stock intended
to ensure compliance with these requirements.
Specifically, Duke's articles of incorporation contain restrictions which:
- authorize but do not require Duke's board of directors to refuse to give
effect to a transfer of common stock which, in its opinion, might
jeopardize the status of Duke as a REIT;
- nullify any attempted acquisition of shares which would result in the
disqualification of Duke as a REIT;
- give the board of directors the authority to take any actions it deems
advisable to enforce the provision, which might include refusing to give
effect to or seeking to enjoin a transfer which might jeopardize Duke's
status as a REIT; and
- require any shareholder to provide Duke such information regarding his or
her direct and indirect ownership of common stock as Duke may reasonably
require.
REGISTRAR AND TRANSFER AGENT
The registrar and transfer agent for the common stock is American Stock
Transfer & Trust Company, New York, New York.
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FEDERAL INCOME TAX CONSIDERATIONS
The following is a summary of material federal income tax considerations
relevant to us and to an investor in the debt and equity securities offered by
this prospectus. You should be aware of the following about this summary:
- It is based upon current law.
- It does not cover all possible tax considerations.
- It does not include a detailed description of any state, local, or foreign
tax considerations.
- It does not describe all of the aspects of federal income taxation that
may be relevant to you in light of your particular circumstances.
- It does not describe all of the aspects of Federal income taxation that
may be relevant to certain types of security holders (including insurance
companies, tax exempt entities, financial institutions or broker dealers,
foreign corporations and persons who are not citizens or residents of the
United States) subject to special treatment under the federal income tax
laws.
You should consult with your own tax advisors regarding federal, state,
local and other tax laws applicable to your specific situation as well as any
potential changes in tax laws. As used in this section, the term "Duke" refers
solely to Duke-Weeks Realty Corporation without its subsidiaries, and the term
"Operating Partnership" refers solely to Duke-Weeks Realty Limited Partnership
without its subsidiaries.
TAXATION OF DUKE
GENERAL. Duke expects to continue to be taxed as a REIT for federal income
tax purposes. Duke's management believes that Duke was organized and has
operated in a manner that meets the requirements for qualification and taxation
as a REIT under the Internal Revenue Code of 1986, as amended (the "Code"), and
that Duke intends to continue to operate in such a manner. We cannot assure you,
however, that Duke will continue to operate in a manner that will allow it to
remain qualified as a REIT.
In the opinion of Bose McKinney & Evans LLP, which has acted as our counsel,
if the assumptions and representations referred to below are true, Duke's
proposed methods of operation and the proposed methods of operation of the
Operating Partnership and Duke Realty Services Limited Partnership (the
"Services Partnership") since and including 1994 have permitted and will permit
Duke to continue to qualify to be taxed as a REIT for all years since and
including 1994 and for Duke's current and subsequent taxable years. This opinion
is:
- based on an assumption that Duke was organized in conformity with and has
satisfied the requirements for qualification and taxation as a REIT under
the Code for each of its taxable years from and including the first year
for which it made the election to be taxed as a REIT through 1993;
- based upon certain assumptions relating to the organization and operation
of Duke Services, Inc. ("DSI"), the Operating Partnership and the Services
Partnership;
- conditioned upon certain representations made by Duke's personnel and
affiliates as to certain factual matters relating to Duke's past
operations and its intended manner of future operation and the intended
manner of future operation of the Operating Partnership and the Services
Partnership; and
- based upon Duke's receipt of a letter ruling from the IRS dated
September 30, 1994, which concluded that the Operating Partnership's and
Duke's distributive shares of the gross income of
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the Services Partnership will be in proportion to the respective
percentage shares of the capital interests of the partners of the Services
Partnership.
Bose McKinney & Evans LLP is not aware of any facts or circumstances which are
inconsistent with these assumptions and representations. Unlike a tax ruling, an
opinion of counsel is not binding upon the IRS, and we cannot be sure that the
IRS will not challenge Duke's status as a REIT for Federal income tax purposes.
Duke's qualification and taxation as a REIT has depended and will depend upon,
among other things, its ability to meet on a continuing basis, through ownership
of assets, actual annual operating results, receipt of qualifying real estate
income, distribution levels and diversity of stock ownership, the various
qualification tests imposed under the Internal Revenue Code discussed below.
Bose McKinney & Evans LLP will not review compliance with these tests on a
periodic or continuing basis. Accordingly, neither Bose McKinney & Evans LLP nor
we can assure you that Duke will continue to satisfy these tests. See "Taxation
of Duke -- Failure to Qualify."
The following is a general summary of the Code sections which govern the
federal income tax treatment of a REIT and its shareholders. These sections of
the Code are highly technical and complex. This summary is qualified in its
entirety by the applicable Code provisions, Treasury Regulations, and
administrative and judicial interpretations as currently in effect.
So long as Duke qualifies for taxation as a REIT and distributes at least
95% of its REIT taxable income (computed without regard to net capital gains or
the dividends paid deduction) for its taxable year to its shareholders, Duke
will generally not be subject to federal income tax with respect to income which
it distributes to its shareholders. However, Duke may be subject to federal
income tax under certain circumstances, including taxes at regular corporate
rates on any undistributed REIT taxable income, the "alternative minimum tax" on
its items of tax preference, and taxes imposed on income and gain generated by
certain extraordinary transactions.
REQUIREMENTS FOR QUALIFICATION. The Code defines a REIT as a corporation,
trust or association:
(1) which is managed by one or more trustees or directors;
(2) the beneficial ownership of which is evidenced by transferable shares or
by transferable certificates of beneficial interest;
(3) which would be taxable as a domestic corporation but for Sections 856
through 859 of the Code;
(4) which is neither a financial institution nor an insurance company
subject to certain provisions of the Code;
(5) which has the calendar year as its taxable year;
(6) the beneficial ownership of which is held by 100 or more persons;
(7) during the last half of each taxable year not more than 50% in value of
the outstanding stock of which is owned, directly or indirectly, by five
or fewer individuals (as defined in the Code to include certain
entities); and
(8) which meets certain income and assets tests, described below.
We believe Duke currently satisfies all requirements.
INCOME TESTS. In order to qualify as a REIT, there are two gross income
tests that must be satisfied annually. For purposes of these tests, Duke is
deemed to be entitled to a share of the gross
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income attributable to its proportionate interest in any partnerships in which
it holds an interest. The tests are:
- First, at least 75% of Duke's gross income (excluding gross income from
prohibited transactions) for each taxable year must be derived directly or
indirectly from investments relating to real property (including "rents
from real property," gain from the sale of real property and, in certain
circumstances, interest) or from qualified types of temporary investments.
- Second, at least 95% of Duke's gross income (excluding gross income from
prohibited transactions) for each taxable year must be derived from the
same items which qualify under the 75% income test or from dividends,
interest and gain from the sale or disposition of stock or securities, or
from any combination of the foregoing.
Rents Duke receives will qualify as "rents from real property" in satisfying
the gross income tests for a REIT described above only if several conditions
(related to the relationship of the tenant to Duke, the method of determining
the rent payable and nature of the property leased) are met. Duke does not
anticipate receiving rents in excess of a minimal amount that fail to meet these
conditions. Finally, for rents received to qualify as "rents from real
property," Duke generally must not operate or manage the property or furnish or
render services to tenants, other than through an "independent contractor" that
is adequately compensated and from whom Duke derives no income. However, Duke
may perform services "usually or customarily rendered" in connection with the
rental of space for occupancy only and not otherwise considered "rendered to the
occupant" ("Permissible Services").
Duke provides certain management, development, construction and other tenant
related services with respect to our properties through the Operating
Partnership, which is not an independent contractor. Our management believes
that the material services provided to tenants by the Operating Partnership are
Permissible Services. To the extent services to tenants do not constitute
Permissible Services, such services are performed by independent contractors.
Under the Taxpayer Relief Act of 1997 (the "1997 Act"), in determining
whether a REIT satisfies the income tests, a REIT's rental income from a
property will not cease to qualify as "rents from real property" merely because
the REIT performs services for a tenant other than permitted customary services
if the amount that the REIT is deemed to have received as a result of performing
impermissible services does not exceed one percent of all amounts received
directly or indirectly by the REIT with respect to such property. The amount
that a REIT will be deemed to have received for performing impermissible
services is at least 150% of the direct cost to the REIT of providing those
services.
Duke derives a portion of its income from the Operating Partnership's
interest as a limited partner in the Services Partnership and its ownership of
DSI, which is a general partner of the Services Partnership. The Services
Partnership receives fees for real estate services with respect to properties
that are not owned directly by the Operating Partnership and fees in
consideration for the performance of management and administrative services with
respect to properties that are not entirely owned by the Operating Partnership.
All or a portion of such fees will not qualify as "rents from real property" for
purposes of the 75% or 95% gross income tests. Pursuant to Treasury Regulations,
a partner's capital interest in a partnership determines its proportionate
interest in the partnership's gross income from partnership assets for purposes
of the 75% and 95% gross income tests. For this purpose, the capital interest of
a partner is determined by dividing its capital account by the sum of all
partners' capital accounts.
The partnership agreement of the Services Partnership provides, however, for
varying allocations of income which differ from capital interests, subject to
certain limitations on the aggregate amount of gross income which may be
allocated to the Operating Partnership and DSI. Duke has obtained a letter
ruling from the IRS that allocations according to capital interests are proper
for applying the 75% and
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95% gross income tests. Thus, for purposes of these gross income tests, the
Services Partnership allocates its gross income to the Operating Partnership and
DSI based on their capital interests in the Services Partnership. Although
certain of the fees allocated from the Services Partnership do not qualify under
the 75% or 95% gross income tests as "rents from real property," we believe that
the aggregate amount of such fees (and any other non-qualifying income)
allocated to Duke in any taxable year has not and will not cause Duke to exceed
the limits on non-qualifying income under the 75% or 95% gross income tests
described above.
If Duke fails to satisfy one or both of the 75% or 95% gross income tests
for any taxable year, Duke may nevertheless qualify as a REIT for such year if
it is entitled to relief under certain provisions of the Code. It is not
possible, however, to state whether in all circumstances Duke would be entitled
to the benefit of these relief provisions. Even if these relief provisions
apply, a tax would be imposed on certain excess net income.
ASSET TESTS. In order for Duke to maintain its qualification as a REIT, at
the close of each quarter of its taxable year, it must also satisfy three tests
relating to the nature of its assets. These tests are:
- First, at least 75% of the value of its total assets must be represented
by "real estate assets," cash, cash items, and government securities.
- Second, not more than 25% of its total assets may be represented by
securities other than those in the 75% assets class.
- Third, of the assets held in securities other than those in the 75% assets
class, the value of any one issuer's securities Duke owns may not exceed
5% of the value of its total assets, and it may not own more than 10% of
any one issuer's outstanding voting securities (excluding securities of a
qualified REIT subsidiary as defined in the Code or another REIT).
Duke is deemed to directly hold its proportionate share of all real estate
and other assets of the Operating Partnership as well as its proportionate share
of all assets deemed owned by the Operating Partnership and DSI through their
ownership of partnership interests in the Services Partnership and other
partnerships. As a result, Duke's management believes that more than 75% of its
assets are real estate assets. In addition, Duke's management does not expect it
to hold:
- any securities representing more than 10% of any one issuer's voting
securities other than DSI, which is a qualified REIT subsidiary; nor
- securities of any one issuer exceeding 5% of the value of Duke's gross
assets (determined in accordance with generally accepted accounting
principles).
ANNUAL DISTRIBUTION REQUIREMENTS. In order to qualify as a REIT, Duke
generally must distribute dividends (other than capital gain dividends) to its
shareholders in an amount at least equal to:
- the sum of:
- 95% of its "REIT taxable income" (computed without regard to the
dividends paid deduction and its net capital gain); and
- 95% of the net income (after tax), if any, from foreclosure property;
- minus the sum of certain items of non-cash income.
To the extent that Duke does not distribute all of its net capital gain or
distribute at least 95%, but less than 100%, of its "REIT taxable income," as
adjusted, Duke will be subject to tax on the undistributed amount at regular
capital gains and ordinary corporate tax rates. Furthermore, Duke will be
subject to regular capital gains and ordinary corporate tax rates on
undistributed income and also may be subject
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to a 4% excise tax on undistributed income in certain events if it should fail
to distribute during each calendar year at least the sum of:
- 85% of its REIT ordinary income for such year;
- 95% of its REIT net capital gain income for such year; and
- any undistributed taxable income from prior periods.
Under the 1997 Act, certain non-cash income, including income from
cancellation of indebtedness and original issue discount, will be excluded from
income in determining the amount of dividends that a REIT is required to
distribute. In addition, a REIT may elect to retain and pay income tax on any
net long-term capital gains and require its shareholders to include such
undistributed net capital gains in their income. If a REIT made such an
election, the REIT's shareholders would receive a tax credit attributable to
their share of capital gains tax paid by the REIT on the undistributed net
capital gain that was included in the shareholders' income, and such
shareholders would receive an increase in the basis of their shares in the
amount of undistributed net capital gain included in their income reduced by the
amount of the credit.
Duke believes that it has made and intends to continue to make timely
distributions sufficient to satisfy the annual distribution requirements. In
this regard, the partnership agreement of the Operating Partnership authorizes
Duke, as general partner, to take such steps as may be necessary to cause the
Operating Partnership to distribute to its partners an amount sufficient to
permit Duke to meet these distribution requirements. It is possible, however,
that from time to time Duke may not have sufficient cash or other liquid assets
to meet the 95% distribution requirement due primarily to the expenditure of
cash for nondeductible expenses such as principal amortization or capital
expenditures. In such event, Duke may borrow or may cause the Operating
Partnership to arrange for short term or other borrowing to permit the payment
of required dividends or pay dividends in the form of taxable stock dividends.
If the amount of nondeductible expenses exceeds non-cash deductions, the
Operating Partnership may refinance its indebtedness to reduce principal
payments and borrow funds for capital expenditures.
FAILURE TO QUALIFY. If Duke fails to qualify for taxation as a REIT in any
taxable year, it will be subject to tax (including any applicable corporate
alternative minimum tax) on its taxable income at regular corporate rates.
Distributions to shareholders in any year in which Duke fails to qualify will
not be required to be made and, if made, will not be deductible by Duke. Unless
entitled to relief under specific statutory provisions, Duke also will be
disqualified from taxation as a REIT for the four taxable years following the
year during which qualification was lost. It is not possible to state whether in
all circumstances Duke would be entitled to such statutory relief. The 1997 Act
contains a number of technical provisions that reduce the risk that a REIT will
inadvertently fail to qualify as a REIT.
TAX ASPECTS OF DUKE'S INVESTMENTS IN PARTNERSHIPS
EFFECT OF TAX STATUS OF OPERATING PARTNERSHIP AND SERVICES PARTNERSHIP AND
OTHER PARTNERSHIPS ON REIT QUALIFICATION. All of Duke's investments are through
DSI and the Operating Partnership, which in turn hold interests in other
partnerships, including the Services Partnership. We believe that the Operating
Partnership, and each other partnership in which it holds an interest, are
properly treated as partnerships for tax purposes (and not as an association
taxable as a corporation). If, however, the Operating Partnership were treated
as an association taxable as a corporation, Duke would cease to qualify as a
REIT.
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TAX ALLOCATIONS WITH RESPECT TO THE PROPERTIES. The Operating Partnership
was formed by way of contributions of appreciated property (including certain of
the properties it currently owns) to the Operating Partnership. When property is
contributed to a partnership in exchange for an interest in the partnership, the
partnership generally takes a carryover basis in that property for tax purposes
equal to the adjusted basis of the contributing partner in the property, rather
than a basis equal to the fair market value of the property at the time of
contribution (this difference is referred to as "Book Tax Difference"). The
partnership agreement of the Operating Partnership requires allocations of
income, gain, loss and deduction with respect to a contributed property be made
in a manner consistent with the special rules of Section 704(c) of the Code and
the associated regulations, which will tend to eliminate the Book Tax
Differences with respect to the contributed properties over the life of the
Operating Partnership. However, because of certain technical limitations, the
special allocation rules of Section 704(c) may not always entirely eliminate the
Book Tax Differences on an annual basis or with respect to a specific taxable
transaction such as a sale. Thus, the carryover basis of the contributed
properties in the hands of the Operating Partnership could cause the following
effects:
- Duke could be allocated lower amounts of depreciation and other deductions
for tax purposes than would be allocated to it if all of the Operating
Partnership's properties were to have a tax basis equal to their fair
market value at the time of contribution.
- Duke could possibly be allocated taxable gain in the event of a sale of
such contributed properties in excess of the economic or book income
allocated to it as a result of such sale.
These principles also apply in determining Duke's earnings and profits for
purposes of determining the portion of distributions taxable as dividend income.
The application of these rules over time may result in a higher portion of
distributions being taxed as dividends than would have occurred had the
Operating Partnership purchased its interests in its properties at their agreed
values.
TAXATION OF TAXABLE DOMESTIC SHAREHOLDERS
As long as Duke qualifies as a REIT, dividend distributions made to its
taxable domestic shareholders out of current or accumulated earnings and profits
(and not designated as capital gain dividends) will be taken into account by
them as ordinary income and will not be eligible for the dividends received
deduction for corporations. In addition, any dividend Duke declares in October,
November or December of any year payable to a shareholder of record on a
specified date in any such month will be treated as both paid by Duke and
received by the shareholder on December 31 of such year, provided that Duke
actually pays the dividend during January of the following calendar year.
Distributions in excess of current and accumulated earnings and profits will
not be taxable to a holder to the extent that they do not exceed the adjusted
basis of the holder's shares, but rather will reduce the adjusted basis of such
shares. To the extent that such distributions exceed the adjusted basis of a
holder's shares, they will be included in income as long-term capital gain (or
short-term capital gain if the shares have been held for one year or less)
assuming the shares are a capital asset in the hands of the holder. Shareholders
may not include in their individual income tax returns any of Duke's net
operating losses or capital losses.
In general, a domestic shareholder will realize capital gain or loss on the
disposition of common stock equal to the difference between (1) the amount of
cash and the fair market value of any property received on such disposition and
(2) the shareholder's adjusted basis of such common stock. Under the 1997 Act,
as revised by the recently-enacted IRS Restructuring Act, for gains realized
after December 31, 1997, and subject to certain exceptions:
- the maximum rate of tax on net capital gains of individuals, trusts and
estates from the sale or exchange of assets held for more than 12 months
has been reduced to 20%;
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- the maximum rate of tax on net capital gains of individuals, trusts and
estates from the sale or exchange of assets is reduced to 18% for assets
acquired after December 31, 2000 and held for more than five years;
- for taxpayers who would be subject to a maximum tax rate of 15%, the rate
on net capital gains is reduced to 10%;
- for taxpayers who would be subject to a maximum tax rate of 15%, effective
for taxable years commencing after December 31, 2000, the rate is reduced
to 8% for assets held for more than five years;
- the maximum rate for net capital gains attributable to the sale of
depreciable real property held for more than 12 months is 25% to the
extent of the deductions for depreciation with respect to such property;
and
- long-term capital gain Duke allocates to a shareholder will be subject to
the 25% rate to the extent that the gain does not exceed depreciation on
real property the Operating Partnership sells.
The taxation of capital gains of corporations was not changed by the 1997 Act or
the IRS Restructuring Act. Loss upon a sale or exchange of common stock by a
shareholder who has held such common stock for six months or less (after
applying certain holding period rules) will be treated as a long-term capital
loss to the extent of distributions from Duke required to be treated by such
shareholder as long-term capital gain.
TAXATION OF TAX-EXEMPT SHAREHOLDERS
Tax-exempt entities, including qualified employee pension and profit sharing
trusts and individual retirement accounts, generally are exempt from federal
income taxation. However, they are subject to taxation on their unrelated
business taxable income ("UBTI"). While many investments in real estate generate
UBTI, the IRS has issued a published ruling that dividend distributions from a
REIT to an exempt employee pension trust do not constitute UBTI, provided that
the shares of the REIT are not otherwise used in an unrelated trade or business
of the exempt employee pension trust. Based on that ruling, amounts Duke
distributes to exempt organizations generally should not constitute UBTI.
However, if an exempt organization finances its acquisitions of the common
shares with debt, a portion of its income from Duke will constitute UBTI
pursuant to the "debt-financed property" rules. Furthermore, social clubs,
voluntary employee benefit associations, supplemental unemployment benefit
trusts, and qualified group legal services plans that are exempt from taxation
under paragraphs (7), (9), (17), and (20), respectively, of Code section 501(c)
are subject to different UBTI rules, which generally will require them to
characterize distributions from Duke as UBTI.
In addition, in certain circumstances, a pension trust that owns more than
10% of Duke's shares is required to treat a percentage of the dividends from
Duke as UBTI (the "UBTI Percentage"). The UBTI Percentage is Duke's gross income
derived from an unrelated trade or business (determined as if Duke were a
pension trust) divided by Duke's gross income for the year in which the
dividends are paid. The UBTI rule applies to a pension trust holding more than
10% of Duke's stock only if:
- the UBTI Percentage is at least 5%;
- Duke qualifies as a REIT by reason of the modification of the "five or
fewer" stock ownership requirement that allows the beneficiaries of the
pension trust to be treated as holding Duke shares in proportion to their
actuarial interests in the pension trust; and
- either:
- one pension trust owns more than 25% of the value of Duke's shares; or
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- a group of pension trusts individually holding more than 10% of the
value of Duke's shares collectively owns more than 50% of the value of
Duke's shares.
TAX RELIEF EXTENSION ACT OF 1999
The Tax Relief Extension Act of 1999, signed into law by President Clinton
on December 17, 1999, contains several provisions modifying current law as it
applies to REITs.
First, under prior law, a REIT could own not more than 10% of the
outstanding voting securities of a single issuer. Under the act, a REIT also
generally cannot own more than 10% of the total value of securities of a single
issuer. In addition, no more than 20% of the value of a REIT's assets can be
represented by securities of the taxable REIT subsidiaries permitted under the
act. However, for purposes of the new ten-percent-value test, securities are
generally defined to exclude certain safe-harbor debt owned by a REIT if the
issuer is an individual or if the REIT owns no other securities of the issuer;
where a REIT owns securities of a partnership, safe-harbor debt is excluded from
the definition of securities only if the REIT owns at least 20% or more of the
profits interest in the partnership.
Second, a broad exception to the limitations on ownership of securities of a
single issuer applies in the case of a "taxable REIT subsidiary" that meets
certain requirements. To qualify as a taxable REIT subsidiary, both the REIT and
the subsidiary corporation must join in an election. In addition, any
corporation (other than a REIT or a qualified REIT subsidiary that does properly
elect with the REIT to be a taxable REIT subsidiary) of which a taxable REIT
subsidiary owns, directly or indirectly, more than 35% of the vote or value is
automatically treated as a taxable REIT subsidiary. Securities of taxable REIT
subsidiaries cannot exceed 20% of the total value of a REIT's assets. A taxable
REIT subsidiary can engage in certain business activities that under prior law
could disqualify the REIT as a REIT because the taxable REIT subsidiary's
activities and relationship with the REIT could have prevented certain income
from qualifying as rents from real property. Under the act, the subsidiary can
provide services to tenants of REIT property (even if such services were not
considered services customarily furnished in connection with the rental of real
property), and can manage or operate properties, generally for third parties,
without causing amounts received or accrued directly or indirectly by the REIT
for such activities to fail to be treated as rents from real property. However,
rents paid to a REIT generally are not qualified rents if the REIT owns more
than 10% of the value (as well as of the vote) of a corporation paying the
rents. The exceptions are for rents that are paid by taxable rent subsidiaries
and that also meet a limited rental exception (when 90% of space is leased to
third parties at comparable rents) and an exception for rents from certain
lodging facilities (operated by an independent contractor). Furthermore,
interest paid by a taxable REIT subsidiary to the related REIT is subject to
certain rules by which the taxable REIT subsidiary cannot deduct interest in any
year that would exceed 50% of the subsidiary's adjusted gross income if the
taxable REIT subsidiary's debt/equity ratio exceeded 1.5 to 1. In addition, if
any amount of interest, rent or other deductions of the taxable REIT subsidiary
for amounts paid to the REIT is determined to be other than at arms-length, an
excise tax of 100% is imposed on the portion that was excessive. Certain safe
harbors are provided for certain rental payments.
Third, the act modifies the REIT distribution requirements to conform to the
rules for regulated investment companies; thus, a REIT is required to distribute
only 90%, rather than 95%, of its income.
Fourth, as to the definition of "independent contractor", if any class of
stock of the REIT or the person being tested as an independent contractor is
regularly traded on an established securities market, only persons who directly
or for indirectly own 5% or more of such class of stock shall be counted in
determining whether the 35% ownership limitations have been exceeded.
Fifth, the act modifies the present law rule that permits certain rents from
personal property to be treated as real estate rental income if such personal
property does not exceed 15% of the aggregate of
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real and personal property. The act replaces the prior law comparison of the
adjusted bases of properties with a comparison based on fair market values.
The effective date of the Act is two taxable years beginning after December
31, 2000. As to provisions related to permitted ownership of securities of an
issuer, special transition rules apply. Thus, the new rules forbidding a REIT to
own more than 10% of the value of securities of a single issuer do not apply to
a REIT with respect to securities held directly or indirectly by such REIT on
July 12, 1999, or acquired pursuant to the terms of a written binding contract
in effect on that date and at all times thereafter until the acquisition.
Similarly, securities received in a tax-free exchange or reorganizations with
respect to or in exchange for such grandfathered securities would also be
grandfathered. The grandfathering of such securities ceases to apply if the REIT
acquires additional securities of that issuer after that date, other than
pursuant to a binding contract in effect on that date and at all times
thereafter or in a reorganization with another corporation, the securities of
which are grandfathered.
The transition rule applicable to securities also ceases to apply to
securities of a corporation as of the first day after July 12, 1999, on which
such corporation engages in a substantial new line of business, or acquires any
substantial asset, other than pursuant to a binding contract in effect on such
date and at all times thereafter or in a reorganization or transaction in which
gain or loss is not recognized by reason of Section 1031 or 1033 of the Internal
Revenue Code. If a corporation makes an election to become a taxable REIT
subsidiary, effective before January 1, 2004, and at a time when the REIT's
ownership is grandfathered under these rules, the election is treated as a
reorganization under Section 368(a)(1)(A) of the Internal Revenue Code.
Finally, the new 10% of value limitation for purposes of defining qualified
rents is effective for taxable years beginning after December 21, 2000. However,
there is an exception for rents paid under a lease or pursuant to a binding
contract in effect on July 12, 1999, and at all times thereafter.
BACKUP WITHHOLDING
Duke will report to its domestic shareholders and the IRS the amount of
dividends paid during each calendar year, and the amount of tax withheld, if
any. Under the backup withholding rules, a shareholder may be subject to backup
withholding at the rate of 31% with respect to dividends paid unless such
holder:
- is a corporation or comes within certain other exempt categories and, when
required, demonstrates this fact; or
- provides a taxpayer identification number, certifies as to no loss of
exemption from backup withholding, and otherwise complies with applicable
requirements of the backup withholding rules.
A shareholder that does not provide Duke with his or her correct taxpayer
identification number may also be subject to penalties imposed by the IRS. A
shareholder can credit any amount paid as backup withholding against the
shareholder's income tax liability. In addition, Duke may be required to
withhold a portion of capital gain distributions made to any shareholders who
fail to certify their non-foreign status to Duke.
The Treasury Department has issued proposed regulations regarding the
withholding and information reporting rules discussed above. In general, the
proposed regulations do not alter the substantive withholding requirements but
unify current certification procedures and forms, and clarify and modify
reliance standards. If finalized in their current form, the proposed regulations
would generally be effective for payments made after December 31, 1997, subject
to certain transition rules.
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TAXATION OF NON-U.S. SHAREHOLDERS
The rules governing U.S. federal income taxation of nonresident alien
individuals, foreign corporations, foreign partnerships, and other foreign
shareholders are complex, and this is only a limited summary of those rules.
Prospective non-U.S. shareholders should consult with their own tax advisors to
determine the impact of U.S. federal, state and local income tax laws on an
investment in our securities, including any reporting requirements.
Distributions that are not attributable to gain from the Operating
Partnership's sales or exchanges of U.S. real property interests and not
designated by Duke as capital gain dividends will be treated as dividends of
ordinary income to the extent that they are made out of Duke's current or
accumulated earnings and profits. Such distributions, ordinarily, will be
subject to a withholding tax equal to 30% of the gross amount of the
distribution unless an applicable tax treaty reduces that tax. Distributions in
excess of Duke's current and accumulated earnings and profits will not be
taxable to a non-U.S. shareholder to the extent that they do not exceed the
adjusted basis of the shareholder's common stock, but rather will reduce the
adjusted basis of that common stock. To the extent that such distributions
exceed the adjusted tax basis of a non-U.S. shareholder's common stock, the
non-U.S. shareholder will have tax liability if the non-U.S. shareholder would
otherwise be subject to tax on any gain from the sale or disposition of his or
her common stock as described below (in which case the shareholder may also be
required to pay a 30% branch profits tax if the shareholder is a foreign
corporation). As a result of a legislative change made by the Small Business Job
Protection Act of 1996, Duke is required to withhold 10% of any distribution in
excess of its current accumulated earnings and profits. Consequently, although
Duke intends to withhold at a rate of 30% on the entire amount of any
distribution, to the extent that it does not do so any portion of a distribution
not subject to withholding at a rate of 30% will be subject to withholding at a
rate of 10%. However, the non-U.S. shareholder may seek a refund of such amounts
from the IRS if it is subsequently determined that such distribution was, in
fact, in excess of Duke's current or accumulated earnings and profits, and the
amount withheld exceeds the non-U.S. shareholder's United States tax liability,
if any, with respect to the distribution.
For any year in which Duke qualifies as a REIT, distributions that are
attributable to gain from the Operating Partnership's sales or exchanges of U.S.
real property interests will be taxed to a non-U.S. shareholder under the
provisions of the Foreign Investment in Real Property Tax Act of 1980 ("FIRPTA")
at the normal capital gain rates applicable to domestic shareholders (subject to
applicable alternative minimum tax and a special alternative minimum tax in the
case of nonresident alien individuals). Also, distributions subject to FIRPTA
may be subject to a 30% branch profits tax in the hands of a corporate non-U.S.
shareholder not entitled to treaty relief or exemption. Duke is required to
withhold 35% of any distribution that it designates or could designate as a
capital gain dividend. The amount withheld is creditable against the non-U.S.
shareholder's FIRPTA tax liability.
Gain recognized by a non-U.S. shareholder upon a sale of common stock
generally will not be taxed under FIRPTA if Duke is a "domestically controlled
REIT," defined generally as a REIT in which at all times during a specified
testing period less than 50% in value of the stock was held directly or
indirectly by foreign persons. Duke believes that it is a "domestically
controlled REIT," and, therefore, that the sale of common stock will not be
subject to taxation under FIRPTA. If the gain on the sale of common stock were
to be subject to tax under FIRPTA, the non-U.S. shareholder would be subject to
the same treatment as domestic shareholders with respect to such gain (subject
to applicable alternative minimum tax and a special alternative minimum tax in
the case of nonresident alien individuals), and the purchaser of the common
stock would be required to withhold and pay to the IRS 10% of the purchase
price.
REDEMPTION OF PREFERRED SHARES AND DEPOSITARY SHARES
If an issue of preferred shares or depositary shares is redeemable, a
redemption of preferred shares, and a consequent redemption of any depositary
shares representing such preferred shares, will
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be treated under Section 302 of the Code as a distribution taxable as a dividend
(to the extent of Duke's current and accumulated earnings and profits) at
ordinary income rates unless the redemption satisfies one of the tests set forth
in Section 302(b) of the Code and is therefore treated as a sale or exchange of
the redeemed shares. None of these dividend distributions will be eligible for
the dividends received deduction for corporate shareholders. The redemption will
be treated as a sale or exchange if it:
- is "substantially disproportionate" with respect to the holder;
- results in a "complete termination" of the holder's share interest in
Duke; or
- is "not essentially equivalent to a dividend" with respect to the holder,
all within the meaning of Section 302(b) of the Code.
In determining whether any of these tests have been met, preferred shares or
depositary shares considered to be owned by the holder by reason of certain
constructive ownership rules set forth in the Code, as well as preferred shares
or depositary shares actually owned by the holder, must generally be taken into
account. If a particular holder of preferred shares or depositary shares owns
(actually or constructively) no shares of Duke's common stock, or an
insubstantial percentage of the outstanding shares of Duke's common stock, a
redemption of preferred shares or depositary shares of that holder is likely to
qualify for sale or exchange treatment because the redemption would not be
"essentially equivalent to a dividend." However, because the determination as to
whether any of the alternative tests of Section 302(b) of the Code will be
satisfied with respect to any particular holder of preferred shares or
depositary shares depends upon the facts and circumstances at the time that the
determination must be made, prospective holders of preferred shares or
depositary shares are advised to consult their own tax advisors to determine
such tax treatment.
If a redemption of preferred shares or depositary shares is not treated as a
distribution taxable as a dividend to a particular holder, it will be treated as
to that holder as a taxable sale or exchange. As a result, the holder will
recognize gain or loss for federal income tax purposes in an amount equal to the
difference between:
- the amount of cash and the fair market value of any property received
(less any portion thereof attributable to accumulated and declared but
unpaid dividends, which will be taxable as a dividend to the extent of
Duke's current and accumulated earnings and profits); and
- the holder's adjusted basis in the preferred shares or depositary shares
for tax purposes.
Such gain or loss will be capital gain or loss if the preferred shares or
depositary shares have been held as a capital asset, and will be long-term gain
or loss if such preferred shares or depositary shares have been held for more
than one year.
If a redemption of preferred shares or depositary shares is treated as a
distribution taxable as a dividend, the amount of the distribution will be
measured by the amount of cash and the fair market value of any property
received by the holder. The holder's adjusted basis in the redeemed preferred
shares or depositary shares for tax purposes will be transferred to the holder's
remaining shares of Duke. If the holder owns no other shares of Duke, such basis
may, under certain circumstances, be transferred to a related person or it may
be lost entirely.
CONVERSION OF PREFERRED SHARES OR DEPOSITARY SHARES
If an issue of preferred shares or depositary shares is convertible into
Duke common shares, no gain or loss will generally be recognized for federal
income tax purposes upon the conversion of such preferred shares or depositary
shares at the option of the holder solely into common shares. The basis that a
holder will have for tax purposes in the common shares received upon the
conversion will be equal to the adjusted basis the holder had in the preferred
shares or depositary shares converted and, provided that the preferred shares or
depositary shares were held as a capital asset, the holding period
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for the common shares received will include the holding period for the preferred
shares or depositary shares converted. A holder, however, will generally
recognize gain or loss on the receipt of cash in lieu of a fractional common
share in an amount equal to the difference between the amount of cash received
and the holder's adjusted basis in the fractional share. The discussion in this
paragraph assumes that preferred shares or depositary shares will not be
converted at a time when there are distributions in arrears.
ADJUSTMENTS TO CONVERSION PRICE
If an issue of preferred shares or depositary shares is convertible into
Duke common shares, adjustments in the conversion price pursuant to
anti-dilution provisions or otherwise may result in constructive distributions
to the holders of the preferred shares or depositary shares that could, under
certain circumstances, be taxable to them as dividends pursuant to Section 305
of the Code. If such a constructive distribution were to occur, a holder of
preferred shares or depositary shares could be required to recognize ordinary
income for tax purposes without receiving a corresponding distribution of cash.
STATE AND LOCAL TAXES
Duke, the Operating Partnership or the holders of their securities may be
subject to taxation in various state, local or other jurisdictions, including
those in which they transact business or reside. The tax treatment in such
jurisdictions may differ from the federal income tax consequences discussed
above. Consequently, you should consult your own tax advisor regarding the
effect of state and local tax laws on an investment in our securities.
PLAN OF DISTRIBUTION
We may sell the securities:
- through underwriting syndicates represented by one or more managing
underwriters;
- to or through underwriters or dealers;
- through agents; or
- directly to one or more purchasers.
The distribution of the securities may be effected from time to time in one or
more transactions at:
- a fixed price or prices, which may be changed;
- at market prices prevailing at the time of sale;
- at prices related to prevailing market prices; or
- at negotiated prices.
We will describe the name or names of any underwriters, dealers or agents and
the purchase price of the securities in a prospectus supplement relating to the
securities.
In connection with the sale of the securities, underwriters may receive
compensation from Duke, from the Operating Partnership or from purchasers of the
securities, for whom they may act as agents, in the form of discounts,
concessions, or commissions. Underwriters may sell the securities to or through
dealers, and such dealers may receive compensation in the form of discounts,
concessions, or commissions from the underwriters and/or commissions from the
purchasers for whom they may act as agents. Underwriters, dealers, and agents
that participate in the distribution of the securities may be deemed to be
underwriters, and any discounts or commissions they receive from Duke or the
Operating Partnership, and any profit on the resale of the securities they
realize may be deemed to be underwriting discounts and commissions, under the
Securities Act. Any such underwriter or agent will
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be identified, and any such compensation received from Duke or the Operating
Partnership will be described, in the prospectus supplement for a particular
issue of securities.
Unless otherwise specified in the related prospectus supplement, each series
of the securities will be a new issue with no established trading market, other
than Duke's common stock which is listed on the NYSE. If Duke sells any shares
of common stock pursuant to a prospectus supplement, they will be listed on the
NYSE, subject to official notice of issuance. Duke or the Operating Partnership
may elect to list any series of debt securities, preferred stock or depositary
shares on an exchange, but neither is obligated to do so. It is possible that
one or more underwriters may make a market in a series of the securities, but
any such underwriters will not be obligated to do so and may discontinue any
market making at any time without notice. Therefore, we can give no assurance
about the liquidity of the trading market for any of the securities.
Under agreements Duke and the Operating Partnership may enter into,
underwriters, dealers, and agents who participate in the distribution of the
securities may be entitled to indemnification by Duke or the Operating
Partnership against certain liabilities, including liabilities under the
Securities Act, or to contribution with respect to payments that the
underwriters, dealers or agents may be required to make.
Underwriters, dealers and agents may engage in transactions with, or perform
services for, or be customers of, Duke or the Operating Partnership in the
ordinary course of business.
If so indicated in the applicable prospectus supplement, we will authorize
underwriters or other persons acting as our agents to solicit offers by certain
institutions to purchase securities from us pursuant to contracts providing for
payment and delivery on a future date. Institutions with which such contracts
may be made include commercial and savings banks, insurance companies, pension
funds, investment companies, educational and charitable institutions and others,
but in all cases such institutions must be approved by Duke or the Operating
Partnership, as the case may be. The obligations of any purchaser under any such
contract will be subject to the condition that the purchase of the securities
shall not at the time of delivery be prohibited under the laws of the
jurisdiction to which such purchaser is subject. The underwriters and such other
agents will not have any responsibility in respect of the validity or
performance of such contracts.
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LEGAL OPINIONS
Bose McKinney & Evans LLP, Indianapolis, Indiana, will pass upon the
legality of the securities offered by this prospectus for Duke and the Operating
Partnership. The opinions with respect to the securities may be subject to
assumptions regarding future action to be taken by Duke, the Operating
Partnership, the trustee or the depositary in connection with the issuance and
sale of particular securities, the specific terms of the securities and other
matters that may affect the validity of the securities but that cannot be
determined on the date of those opinions. In addition, the description of
Federal income tax matters contained in this prospectus entitled "Federal Income
Tax Considerations" is based upon the opinion of Bose McKinney & Evans LLP.
Darell E. Zink, Jr., an executive officer and director of Duke, was a partner in
Bose McKinney & Evans LLP through 1982 and was of counsel to that firm until
December, 1990.
EXPERTS
The Consolidated Financial Statements and related Schedules of the Company
and of the Operating Partnership as of December 31, 1999 and 1998, and for each
of the years in the three-year period ended December 31, 1999, each incorporated
herein by reference, have been incorporated herein in reliance upon the reports
of KPMG LLP, independent certified public accountants, incorporated by reference
herein, and upon the authority of said firm as experts in accounting and
auditing.
With respect to the unaudited interim financial information for the periods
ended March 31, 2000 and 1999, incorporated by reference herein, the independent
certified public accountants have reported that they applied limited procedures
in accordance with their professional standards for a review of such
information. However, their separate report included in our quarterly reports on
Form 10-Q of the quarter ended March 31, 2000, and incorporated by reference
herein, states that they did not audit and they do not express an opinion on
that interim financial information. Accordingly, the degree of reliance on their
reports on such information should be restricted in light of the limited nature
of the review procedures applied. The accountants are not subject to the
liability provisions of section 11 of the Securities Act of 1933 for their
report on the unaudited interim financial information because that report is not
a "report" or a "part" of the registration statement prepared or certified by
the accountants within the meaning of sections 7 and 11 of such Act.
The consolidated financial statements and schedules of Weeks Corporation and
its subsidiaries and Weeks Realty, L.P. and its subsidiaries as of December 31,
1998 and 1997, and for each of the three years in the period ended December 31,
1998, incorporated by reference herein, have been audited by Arthur Andersen
LLP, independent public accountants, as indicated in their reports with respect
thereto, and are incorporated by reference herein in reliance upon the authority
of said firm as experts in giving said reports.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
following SEC public reference rooms:
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450 Fifth Street, N.W. 7 World Trade Center 500 West Madison Street
Room 1024 Suite 1300 Suite 1400
Washington, D.C. 20549 New York, New York 10048 Chicago, Illinois 60661
</TABLE>
Our SEC filings can also be read at the following address:
New York Stock Exchange
20 Broad Street
New York, New York 10005
Our SEC filings are also available to the public from the SEC's Web Site at
http://www.sec.gov.
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This prospectus is part of a registration statement we filed with the SEC.
The SEC allows us to "incorporate by reference" the information we file with
them, which means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is considered
to be part of this prospectus, and later information that we file with the SEC
will automatically update and supersede this information. We incorporate by
reference the documents listed below and any future filings made with the SEC
under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act until all the
selling shareholders sell all of the shares of common stock to which this
prospectus relates or the offering is otherwise terminated. We also specifically
incorporate by reference any such filings made after the date of the initial
registration statement and prior to effectiveness of the registration statement.
1. Duke's Annual Report on Form 10-K (file no. 1-9044) for the year ended
December 31, 1999.
2. Duke's Quarterly Report on Form 10-Q (file no. 1-9044) for the quarter
ended March 31, 2000.
3. The description of Duke's common stock contained in its registration
statement on Form 8-A (file no. 1-9044) as amended.
4. The Operating Partnership's Annual Report on Form 10-K (file
no. 0-20625) for the year ended December 31, 1999.
5. The Operating Partnership's Quarterly Report on Form 10-Q (file
no. 0-20625) for the quarter ended March 31, 2000.
6. The Operating Partnership's Current Report on Form 8-K (file
no. 0-20625) filed March 17, 2000.
7. Weeks Corporation's Annual Report on Form 10-K (file no. 1-13254) for
the year ended December 31, 1998.
8. Weeks Corporation's Quarterly Report on Form 10-Q (file no. 1-13254) for
the quarter ended March 31, 1999.
9. Weeks Realty, L.P.'s Annual Report on Form 10-K (file no. 1-13969) for
the year ended December 31, 1998.
10. Weeks Realty L.P.'s Quarterly Report on Form 10-Q (file no. 1-13969) for
the quarter ended March 31, 1999.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
Investor Relations
Duke-Weeks Realty Corporation
8888 Keystone Crossing, Suite 1200
Indianapolis, Indiana 46240
Telephone: (317) 808-6000
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
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Registration Fee............................................ $132,000
Printing and Reproduction................................... 10,000
NYSE Listing Fee............................................ 28,000
Professional Fees and Expenses.............................. 20,000
Miscellaneous............................................... 10,000
--------
Total....................................................... $200,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Duke-Weeks Realty Corporation is an Indiana corporation. Duke's officers and
directors are and will be indemnified under Indiana law, the Second Amended and
Restated Articles of Incorporation of Duke, and the partnership agreements of
the Operating Partnership and Duke Realty Services Limited Partnership against
certain liabilities. Chapter 37 of The Indiana Business Corporation Law (the
"IBCL") requires a corporation, unless its articles of incorporation provide
otherwise, to indemnify a director or an officer of the corporation who is
wholly successful, on the merits or otherwise, in the defense of any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative and whether formal or informal, against
reasonable expenses, including counsel fees, incurred in connection with the
proceeding. Duke's Second Amended and Restated Articles of Incorporation do not
contain any provision prohibiting such indemnification.
The IBCL also permits a corporation to indemnify a director, officer,
employee or agent who is made a party to a proceeding because the person was a
director, officer, employee or agent of the corporation against liability
incurred in the proceeding if (i) the individual's conduct was in good faith and
(ii) the individual reasonably believed (A) in the case of conduct in the
individual's official capacity with the corporation that the conduct was in the
corporation's best interests and (B) in all other cases that the individual's
conduct was at least not opposed to the corporation's best interests and (iii)
in the case of a criminal proceeding, the individual either (A) had reasonable
cause to believe the individual's conduct was lawful or (B) had no reasonable
cause to believe the individual's conduct was unlawful. The IBCL also permits a
corporation to pay for or reimburse reasonable expenses incurred before the
final disposition of the proceeding and permits a court of competent
jurisdiction to order a corporation to indemnify a director or officer if the
court determines that the person is fairly and reasonably entitled to
indemnification in view of all the relevant circumstances, whether or not the
person met the standards for indemnification otherwise provided in the IBCL.
Duke's Second Amended and Restated Articles of Incorporation provide for
certain additional limitations of liability and indemnification. Section 13.01
of the Second Amended and Restated Articles of Incorporation provides that a
director shall not be personally liable to Duke or its shareholders for monetary
damages for breach of fiduciary duty as a director, except for liability
(1) for any breach of the director's duty of loyalty to the Company or its
shareholders, (2) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (3) for voting for or
assenting to an unlawful distribution, or (4) for any transaction from which the
director derived an improper personal benefit. Section 13.02 of the Second
Amended and Restated Articles of Incorporation generally provides that any
director or officer of Duke or any person who is serving at the request of Duke
as a director, officer, employee or agent of another entity shall be indemnified
and held harmless by Duke to the fullest extent authorized by the IBCL against
all expense, liability and
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loss (including attorneys' fees, judgments, fines, certain employee benefits
excise taxes or penalties and amounts paid or to be paid in settlement)
reasonably incurred or suffered in connection with a civil, criminal,
administrative or investigative action, suit or proceeding to which such person
is a party by reason of the person's service with or at the request of Duke.
Section 13.02 of the Second Amended and Restated Articles of Incorporation also
provides such persons with certain rights to be paid by Duke the expenses
incurred in defending any such proceeding in advance of the final disposition
and the right to enforce indemnification claims against Duke by bringing suit
against Duke.
Duke's Second Amended and Restated Articles of Incorporation authorize it to
maintain insurance to protect itself and any of its directors, officers,
employees or agents or those of another corporation, partnership, joint venture,
trust or other enterprise against expense, liability or loss, whether or not
Duke would have the power to indemnify such person against such expense,
liability or loss under the IBCL. Duke currently maintains officer and director
liability insurance.
Each of the partnership agreements for the Operating Partnership and Duke
Realty Services Limited Partnership also provides for indemnification of Duke
and its officers and directors to substantially the same extent provided to
officers and directors of Duke in its Second Amended and Restated Articles of
Incorporation, and limits the liability of Duke and its officers and directors
to the Operating Partnership and its partners and to Duke Realty Services
Limited Partnership and its partners, respectively, to substantially the same
extent limited under Duke's Second Amended and Restated Articles of
Incorporation.
ITEM 16. EXHIBITS.
The following exhibits are filed with this Registration Statement:
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3.1 Second Amended and Restated Articles of Incorporation of
Duke-Weeks Realty Corporation, incorporated by reference
from Exhibit 3.1 to the Current Report of Duke-Weeks Realty
Corporation on Form 8-K (file no. 1-9044) filed July 16,
1999.
3.2 Second Amended and Restated Bylaws of Duke-Weeks Realty
Corporation, incorporated by reference from Exhibit 3.2 to
the Current Report of Duke-Weeks Realty Corporation on
Form 8-K (file no. 1-9044) filed July 16, 1999.
3.3 Second Amended and Restated Agreement of Limited Partnership
of Duke-Weeks Realty Limited Partnership, incorporated by
reference from Exhibit 4.1 to the Current Report of
Duke-Weeks Realty Limited Partnership on Form 8-K (file
no. 0-20625) filed July 16, 1999.
4.1 Indenture between Duke-Weeks Realty Limited Partnership
(f/k/a Duke Realty Limited Partnership) and The First
National Bank of Chicago, Trustee, incorporated by reference
to Exhibit 4.1 to the Duke-Weeks Realty Corporation (f/k/a
Duke Realty Investments, Inc.) Current Report on Form 8-K
(file no. 1-9044) dated September 22, 1995.*
4.2 First Supplement to Indenture, incorporated by reference to
Exhibit 4.2 to the Duke-Weeks Realty Corporation (f/k/a Duke
Realty Investments, Inc.) Current Report on Form 8-K (file
no. 1-9044) filed September 22, 1995.
4.3 Second Supplement to Indenture, incorporated by reference to
Exhibit 4 to the Duke-Weeks Realty Limited Partnership
(f/k/a Duke Realty Limited Partnership) Current Report on
Form 8-K (file no. 0-20625) filed July 12, 1996.
4.4 Third Supplement to Indenture, incorporated by reference to
Exhibit 4 to the Duke-Weeks Realty Limited Partnership
(f/k/a Duke Realty Limited Partnership) Current Report on
Form 8-K (file no. 0-20625) filed May 20, 1997.
</TABLE>
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4.5 Fourth Supplement to Indenture, incorporated by reference to
Exhibit 4.3 to the Duke-Weeks Realty Corporation (f/k/a Duke
Realty Investments, Inc.) Registration Statement on Form S-4
(file no. 333-77645).
4.6 Fifth Supplement to Indenture, incorporated by reference to
Exhibit 4 to the Duke-Weeks Realty Limited Partnership
(f/k/a Duke Realty Limited Partnership) Current Report on
Form 8-K (file no. 0-20625) filed June 1, 1998.
4.7 Sixth Supplement to Indenture, incorporated by reference to
Exhibit 4 to the Duke-Weeks Realty Limited Partnership
(f/k/a Duke Realty Limited Partnership) Current Report on
Form 8-K (file no. 0-20625) filed February 12, 1999.
4.8 Seventh Supplement to Indenture, incorporated by reference
to Exhibit 4 to the Duke-Weeks Realty Limited Partnership
(f/k/a Duke Realty Limited Partnership) Current Report on
Form 8-K (file no. 0-20625) filed June 29, 1999.
4.9 Eighth Supplement to Indenture, incorporated by reference to
Exhibit 4 to the Duke-Weeks Realty Limited Partnership
(f/k/a Duke Realty Limited Partnership) Current Report on
Form 8-K (file no. 0-20625) filed November 15, 1999.
5 Opinion and consent of Bose McKinney & Evans LLP regarding
legality of the securities being registered.
8 Opinion and consent of Bose McKinney & Evans LLP regarding
tax matters.
12.1 Calculation of Ratios of Earnings to Fixed Charges.
15 Letter regarding unaudited interim financial information.
23.1 Consent of KPMG LLP.
23.2 Consent of Arthur Andersen LLP.
24 Powers of Attorney.
25 Statement of Eligibility of Trustee on Form T-1,
incorporated by reference to Exhibit 25 to the Registration
Statement on S-3 (file no. 33-61361) of Duke-Weeks Realty
Corporation (f/k/a Duke Realty Investments, Inc.).
</TABLE>
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* In the event that Duke or the Operating Partnership issues a form of
security not filed as an exhibit to this Registration Statement, such form
of security will be filed in a Current Report on Form 8-K.
ITEM 17. UNDERTAKINGS.
Each undersigned Registrant hereby undertakes that 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 provisions described in Item 15 above, 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 Act
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 Act and will be governed by the final adjudication of
such issue.
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Each undersigned Registrant hereby further undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any increase
or decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of a prospectus filed with the
Commission pursuant to Rule 424(b) (Section 230.424(b) of 17 C.F.R.) if,
in the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if the
registration statement is on Form S-3 (Section 239.13 of 17 C.F.R.),
Form S-8 (Section 239.16b of 17 C.F.R.) or Form F-3 (Section 239.33 of 17
C.F.R.), and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to section 13 or section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of
the offering.
Each undersigned Registrant further 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 section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 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.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, each registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Indianapolis, Indiana, on the 24th day of May, 2000.
<TABLE>
<S> <C> <C>
DUKE-WEEKS REALTY CORPORATION
By: /s/ DENNIS D. OKLAK
-----------------------------------------
Dennis D. Oklak
EXECUTIVE VICE PRESIDENT,
CHIEF ADMINISTRATIVE OFFICER
AND TREASURER
DUKE-WEEKS REALTY LIMITED PARTNERSHIP
By: DUKE-WEEKS REALTY CORPORATION
General Partner
By: /s/ DENNIS D. OKLAK
-------------------------------
Dennis D. Oklak
EXECUTIVE VICE PRESIDENT,
CHIEF ADMINISTRATIVE
OFFICER AND TREASURER
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed by the following persons in the
capacities indicated as of the 24th day of May, 2000.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ THOMAS L. HEFNER*
------------------------------------------- Director Chief Executive Officer and Chairman
Thomas L. Hefner of the Board (Principal Executive Officer)
/s/ DARELL E. ZINK, JR.* Executive Vice President and Chief Financial
------------------------------------------- Officer and a Director (Principal Accounting
Darell E. Zink, Jr. Officer)
/s/ DENNIS D. OKLAK
------------------------------------------- Executive Vice President and Chief
Dennis D. Oklak Administrative Officer
/s/ BARRINGTON H. BRANCH*
------------------------------------------- Director
Barrington H. Branch
/s/ GEOFFREY BUTTON*
------------------------------------------- Director
Geoffrey Button
/s/ WILLIAM CAVANAUGH III*
------------------------------------------- Director
William Cavanaugh III
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ NGAIRE E. CUNEO*
------------------------------------------- Director
Ngaire E. Cuneo
/s/ CHARLES R. EITEL*
------------------------------------------- Director
Charles R. Eitel
/s/ HOWARD L. FEINSAND*
------------------------------------------- Director
Howard L. Feinsand
/s/ L. BEN LYTLE*
------------------------------------------- Director
L. Ben Lytle
/s/ WILLIAM O. MCCOY*
------------------------------------------- Director
William O. McCoy
/s/ JOHN W. NELLEY, JR.*
------------------------------------------- Director
John W. Nelley, Jr.
/s/ JAMES E. ROGERS*
------------------------------------------- Director
James E. Rogers
/s/ THOMAS D. SENKBEIL*
------------------------------------------- Director
Thomas D. Senkbeil
/s/ JAY J. STRAUSS*
------------------------------------------- Director
Jay J. Strauss
/s/ A. RAY WEEKS, JR.*
------------------------------------------- Director
A. Ray Weeks, Jr.
</TABLE>
<TABLE>
<S> <C> <C>
*By: /s/ DENNIS D. OKLAK
--------------------------------------
Dennis D. Oklak
ATTORNEY-IN-FACT
</TABLE>
II-6
<PAGE>
Exhibit 5
BOSE McKINNEY & EVANS LLP
2700 First Indiana Plaza
135 North Pennsylvania Street
Indianapolis, Indiana 46240
(317) 684-5000
May 24, 2000
Duke-Weeks Realty Corporation
Duke-Weeks Realty Limited Partnership
8888 Keystone Crossing, Suite 1200
Indianapolis, Indiana 46240
Dear Sirs:
We are acting as counsel to Duke-Weeks Realty Corporation, an Indiana
corporation (the "Company"), and Duke-Weeks Realty Limited Partnership, an
Indiana limited Partnership (the "Partnership"), in connection with the shelf
registration by the Company and the Partnership of $200,000,000 in maximum
aggregate offering price of (i)shares of the Company's Common Stock, par
value $.01 per share (the "Common Stock"), (ii) shares of the Company's
preferred stock ("Preferred Stock") and (iii) shares of Preferred Stock
represented by depositary shares ("Depositary Shares") and $300,000,000 in
maximum aggregate offering price of debt securities of the Partnership ("Debt
Securities"). The Common Stock, Preferred Stock, Depositary Shares and Debt
Securities are the subject of a Registration Statement (the "Registration
Statement") filed by the Company and the Partnership on Form S-3 under the
Securities Act of 1933, as amended.
We have examined photostatic copies of the Company's Second Amended and
Restated Articles of Incorporation and Second Amended and Restated Bylaws and
of the Partnership's Second Amended and Restated Agreement of Limited
Partnership, as amended to date, and such other documents and instruments as
we have deemed necessary to enable us to render the opinion set forth below.
We have assumed the conformity to the originals of all documents submitted to
us as photostatic copies, the authenticity of the originals of such
documents, and the genuineness of all signatures appearing thereon.
Based upon and subject to the foregoing, it is our opinion that:
(1) The Common Stock has been duly authorized by all necessary corporate
action of the Company and when (a) the applicable provisions of the
Securities Act of 1933 and such state "blue sky" or securities laws as may be
applicable have been complied with and (b) the shares of Common Stock have
been issued, delivered, and paid for, such shares of Common Stock will be
legally issued, fully paid, and nonassessable.
<PAGE>
Duke-Weeks Realty Corporation
Duke-Weeks Realty Limited Partnership
May 24, 2000
Page 2
(2) The Preferred Stock and the representation of such Preferred Stock by
Depositary Shares have been duly authorized by all necessary corporate action
of the Company and when (a) the applicable provisions of the Securities Act
of 1933 and such state "blue sky" or securities laws as may be applicable
have been complied with, (b) the Company's board of directors has adopted and
the Company has duly filed with the Indiana Secretary of State an amendment
to its amended and restated articles of incorporation establishing the
preferences, limitations and relative voting and other rights of each series
of Preferred Stock prior to issuance thereof and (c) the shares of Preferred
Stock and, if applicable, Depositary Shares, have been issued, delivered, and
paid for, such shares of Preferred Stock and, if applicable, Depositary
Shares will be legally issued, fully paid, and nonassessable.
(3) The Debt Securities have been duly authorized by all necessary
partnership action of the Partnership and when (a) the applicable provisions
of the Securities Act of 1933 and such state "blue sky" or securities laws as
may be applicable have been complied with and (b) the Debt Securities have
been issued and delivered for value as contemplated in the Registration
Statement, such Debt Securities will be legally issued and will be binding
obligations of the Partnership.
We do not hold ourselves out as being conversant with the laws of any
jurisdiction other than those of the United States and the State of Indiana
and, therefore, this opinion is limited to the laws of those jurisdictions.
We consent to the filing of this opinion as an exhibit to the Registration
Statement on Form S-3 filed under the Securities Act of 1933 relating to the
Common Stock, Preferred Stock, Depositary Shares and Debt Securities.
Very truly yours,
/s/ BOSE McKINNEY & EVANS LLP
<PAGE>
EXHIBIT 8
BOSE McKINNEY & EVANS LLP
135 North Pennsylvania Street
Suite 2700
Indianapolis, Indiana 46204
May 24, 2000
Duke-Weeks Realty Corporation
Duke-Weeks Realty Limited Partnership
8888 Keystone Crossing, Suite 1200
Indianapolis, Indiana 46240
Gentlemen:
We have acted as counsel to Duke-Weeks Realty Corporation (the
"Company") and Duke-Weeks Realty Limited Partnership (the "Operating
Partnership") with respect to the preparation of a Registration Statement on
Form S-3 (the "Registration Statement") for the sale by the Company and the
Operating Partnership of up to $500,000,000 of various equity and debt
securities. In connection therewith, you have requested our opinion with
respect to the Company's continued qualification as a real estate investment
trust ("REIT") under the Internal Revenue Code of 1986, as amended (the
"Code"). You have also requested our opinion regarding certain United States
Federal income tax consequences to the Company and its shareholders of the
qualification of the Company as a REIT under the Code. All capitalized terms
used herein have their respective meanings as set forth in the Registration
Statement unless otherwise stated. The Company is an Indiana corporation
which has qualified as a REIT within the meaning of Section 856(a) of the
Code, for each of its taxable years from and including the first taxable year
for which it made an election to be taxed as a REIT, and intends to continue
to so qualify.
In rendering the opinions stated below, we have examined and relied,
with your consent, upon the following:
(i) The Registration Statement;
<PAGE>
Duke-Weeks Realty Corporation
Duke-Weeks Realty Limited Partnership
May 24, 2000
Page 2
(ii) The Second Amended and Restated Agreement of Limited Partnership
of the Operating Partnership and subsequent amendments thereto;
(iii) The First Amended and Restated Agreement of Limited Partnership
of the Services Partnership;
(iv) Such other documents, records and instruments as we have deemed
necessary in order to enable us to render the opinion referred to in this
letter.
In our examination of the foregoing documents, we have assumed, with
your consent, that (i) all documents reviewed by us are original documents,
or true and accurate copies of original documents, and have not been
subsequently amended, (ii) the signatures on each original document are
genuine, (iii) each party who executed the document had proper authority and
capacity, (iv) all representations and statements set forth in such documents
are true and correct, (v) all obligations imposed by any such documents on
the parties thereto have been or will be performed or satisfied in accordance
with their terms and (vi) the Company, the Operating Partnership and the
Services Partnership at all times will be organized and operated in
accordance with the terms of such documents. We have further assumed the
accuracy of the statements and descriptions of the Company's, the Operating
Partnership's and the Services Partnership's intended activities as described
in the Registration Statement and the reports incorporated therein by
reference.
For purposes of rendering the opinions stated below, we have also
assumed, with your consent, the accuracy of the representations contained in
the Certificate of Representations dated April , 1998 provided to us by the
Company, the Operating Partnership and the Services Partnership. These
representations generally relate to the classification and operation of the
Company as a REIT and the organization and operation of the Operating
Partnership and the Services Partnership. Our opinions
<PAGE>
Duke-Weeks Realty Corporation
Duke-Weeks Realty Limited Partnership
May 24, 2000
Page 3
are further based upon the Company's receipt of a letter ruling from the
Internal Revenue Service ("IRS") dated September 30, 1994 which concluded
that the Company's and the Operating Partnership's distributive shares of the
gross income of the Services Partnership will be in proportion to their
respective percentage shares of the capital interests of the partners of the
Services Partnership.
We have also reviewed the Registration Statement as to its sections
concerning certain United States Federal income tax consequences to the
Company and its shareholders of the qualification of the Company as a REIT
under the Code. Based upon and subject to the foregoing, we are of the
opinion that:
1. Assuming the Company was organized in conformity with
and has satisfied the requirements for qualification
and taxation as a REIT under the Code for each of its
taxable years from and including the first taxable year
for which the Company made the election to be taxed as
a REIT, the proposed methods of operation of the
Company, the Operating Partnership and the Services
Partnership as described in the Registration Statement
and as represented by the Company, the Operating
Partnership and the Services Partnership will permit
the Company to continue to qualify to be taxed as a
REIT for its current and subsequent taxable years; and
2. The tax consequences to the Company and its shareholders of
qualification of the Company as a REIT under the Code will be
consistent with the discussion contained in the section entitled
"Federal Income Tax Considerations" in the Registration
Statement.
The opinions set forth in this letter represent our conclusions as to
the application of federal income tax laws
<PAGE>
Duke-Weeks Realty Corporation
Duke-Weeks Realty Limited Partnership
May 24, 2000
Page 4
existing as of the date of this letter to the transactions described herein.
We can give no assurance that legislative enactments, administrative changes
or court decisions may not be forthcoming that would modify or supersede our
opinions. Moreover, there can be no assurance that positions contrary to our
opinions will not be taken by the IRS, or that a court considering the issues
would not hold contrary to such opinions. Further, the opinions set forth
above represent our conclusion based upon the documents, facts and
representations referred to above. Any material amendments to such documents,
changes in any significant facts or inaccuracy of such representations could
affect the opinions referred to herein. Although we have made such inquiries
and performed such investigations as we have deemed necessary to fulfill our
professional responsibilities as counsel, we have not undertaken an
independent investigation of the facts referred to in this letter.
We express no opinion as to any federal income tax issue or other matter
except those set forth or confirmed above. We consent to the filing of this
opinion as an exhibit to the Registration Statement
Very truly yours,
BOSE McKINNEY & EVANS LLP
<PAGE>
EXHIBIT 12.1
CALCULATION OF RATIOS OF EARNINGS TO FIXED CHARGES
DUKE-WEEKS REALTY CORPORATION
<TABLE>
<CAPTION>
Year Ended December 31,
------------------------------------------------------------- March 31,
1999 1998 1997 1996 1995 2000
---------- ---------- ---------- ---------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Consolidated Net Income (Loss)
Applicable to Common
Shareholders $139,636,000 $90,871,000 $65,999,000 $50,872,000 $35,019,000 $ 48,859,000
Allocation to Preferred Shares 42,604,000 19,833,000 12,485,000 2,559,000 0 12,252,000
(Gain) Loss on
Property Sales (10,013,000) ( 1,351,000) (1,775,000) (4,532,000) (283,000) (14,686,000)
DWRLP Minority Interest 19,811,000 l2,241,000 7,574,000 7,184,000 6,530,000 7,434,000
Interest Expense 86,757,000 6,217,000 40,296,000 32,552,000 22,643,000 32,681,000
----------- ---------- ---------- ---------- ---------- ------------
Earnings Before
Fixed Charges 278,795,000 181,811,000 124,579,000 88,635,000 63,908,000 86,540,000
----------- ----------- ----------- ---------- ---------- ------------
----------- ----------- ----------- ---------- ---------- ------------
Interest Expense 86,757,000 60,217,000 40,296,000 32,552,000 $22,643,000 32,681,000
Allocation to Preferred Shares 42,604,000 19,833,000 12,485,000 2,559,000 0 12,252,000
Interest Costs Capitalized 26,017,000 8,546,000 6,003,000 5,525,000 4,198,000 8,823,000
----------- ----------- ----------- ----------- ----------- ------------
Total Fixed Charges $155,378,000 $88,596,000 $58,784,000 $40,636,000 $26,841,000 $ 53,756,000
----------- ----------- ----------- ----------- ----------- ------------
----------- ----------- ----------- ----------- ----------- ------------
Fixed Charges Ratio 1.79 2.05 2.12 2.18 2.38 1.61
----------- ----------- ----------- ----------- ----------- ------------
----------- ----------- ----------- ----------- ----------- ------------
</TABLE>
<PAGE>
EXHIBIT 12.1
CALCULATION OF RATIOS OF EARNINGS TO FIXED CHARGES
DUKE-WEEKS REALTY LIMITED PARTNERSHIP
<TABLE>
<CAPTION>
Year Ended December 31,
-------------------------------------------------------------- March 31,
1999 1998 1997 1996 1995 2000
----------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Consolidated Net Income
(Loss) Available to
Common Units $159,447,000 $103,112,000 $72,780,000 $58,713,000 $41,600,000 $ 56,293,000
Allocation to
Preferred Units 46,808,000 19,833,000 12,485,000 2,559,000 0 14,354,000
(Gain) Loss on
Property Sales (10,013,000) ( 1,351,000) (1,775,000) (4,532,000) (283,000) (14,686,000)
Interest Expense 86,757,000 60,217,000 40,296,000 32,552,000 22,680,000 32,681,000
----------- ----------- ----------- ----------- ----------- ------------
Earnings Before
Fixed Charges 282,999,000 181,811,000 123,786,000 89,292,000 63,997,000 88,642,000
----------- ---------- ----------- ---------- ---------- ------------
----------- ---------- ----------- ---------- ---------- ------------
Interest Expense 86,757,000 60,217,000 40,296,000 32,552,000 22,680,000 32,681,000
Allocation to
Preferred Units 46,808,000 19,833,000 12,485,000 2,559,000 0 14,354,000
Interest Costs
Capitalized 26,017,000 8,546,000 6,003,000 5,525,000 4,198,000 8,823,000
----------- ------------ ------------ ----------- ---------- ------------
Total Fixed Charges $159,582,000 $88,596,000 $58,784,000 $40,636,000 $26,878,000 $ 55,858,000
----------- ------------ ------------ ----------- ---------- ------------
----------- ------------ ------------ ----------- ---------- ------------
Fixed Charges Ratio 1.77 2.05 2.11 2.20 2.38 1.59
----------- ----------- ------------ ----------- ---------- ------------
----------- ----------- ----------- ----------- ---------- ------------
</TABLE>
<PAGE>
Exhibit 15
[KPMG LETTERHEAD]
The Board of Directors and Partners
DUKE-WEEKS REALTY CORPORATION AND
DUKE-WEEKS REALTY LIMITED PARTNERSHIP:
With respect to the accompanying registration statement, we acknowledge our
awareness of the use therein of our reports dated April 26, 2000 related to
our review of interim financial information.
Pursuant to Rule 436 (c) under the Securities Act of 1933, such reports are
not considered a part of a registration statement prepared or certified by an
accountant, or reports prepared or certified by an accountant within the
meaning of sections 7 and 11 of the Act.
KPMG LLP
KPMG LLP
Indianapolis, Indiana
May 23, 2000
<PAGE>
Exhibit 23.1
The Board of Directors and Partners
Duke-Weeks Realty Corporation and
Duke-Weeks Realty Limited Partnership:
We consent to the use of our report dated January 25, 2000 on the
consolidated financial statements of Duke-Weeks Realty Corporation and
subsidiaries and the related financial statement schedule as of December 31,
1999 and 1998 and for each of the years in the three-year period ended
December 31, 1999, which report appears in the annual report on Form 10-K of
Duke-Weeks Realty Corporation for the year ended December 31, 1999. We also
consent to the use of our report dated January 25, 2000 on the consolidated
financial statements of Duke-Weeks Realty Limited Partnership and
subsidiaries and the related financial statement schedule as of December 31,
1999 and 1998 and for each of the years in the three-year period ended
December 31, 1999, which report appears in the annual report on Form 10-K of
Duke-Weeks Realty Limited Partnership for the year ended December 31, 1999.
Each of these reports is incorporated herein by reference. We also consent to
the reference to our firm under the heading "Experts" in the prospectus.
KPMG LLP
Indianapolis, Indiana
May 23, 2000
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our reports dated February 26,
1999 included in Weeks Corporation's and Weeks Realty, L.P.'s Annual Reports
on Form 10-K for the year ended December 31, 1998 and to all references to
our Firm included in this Registration Statement.
/s/ Arthur Andersen LLP
Atlanta, Georgia
May 23, 2000
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ Geoffrey Button
---------------------------------
Geoffrey Button
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ Ngaire E. Cuneo
---------------------------------
Ngaire E. Cuneo
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ Howard L. Feinsand
---------------------------------
Howard L. Feinsand
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ L. Ben Lytle
---------------------------------
L. Ben Lytle
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ James E. Rogers
---------------------------------
James E. Rogers
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ Jay J. Strauss
---------------------------------
Jay J. Strauss
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ A. Ray Weeks, Jr.
---------------------------------
A. Ray Weeks, Jr.
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Darell E. Zink, Jr., Dennis D.
Oklak and John R. Gaskin, and each of them, his attorneys-in-fact and agents,
with full power of substitution and resubstitution for him in any and all
capacities, to sign a Registration Statement on Form S-3 under the Securities
Act of 1933 (the "Registration Statement") for the registration of various
securities (the "Securities") of Duke-Weeks Realty Corporation (the
"Company") and Duke-Weeks Realty Limited Partnership, any or all
pre-effective amendments or post-effective amendments to the Registration
Statement (which amendments may make such changes in and additions to the
Registration Statement as such attorneys-in-fact may deem necessary or
appropriate), and any registration statement for the offering that is to be
effective upon filing pursuant to Rule 462(b) under the Securities Act of
1933, as amended, and to file the same, with exhibits thereto and other
documents in connection therewith, with the Securities and Exchange
Commission, granting unto each of such attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary in connection with such matters and hereby ratifying and
confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ Thomas L. Hefner
---------------------------------
Thomas L. Hefner
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Dennis D.
Oklak and John R. Gaskin, and each of them, his attorneys-in-fact and agents,
with full power of substitution and resubstitution for him in any and all
capacities, to sign a Registration Statement on Form S-3 under the Securities
Act of 1933 (the "Registration Statement") for the registration of various
securities (the "Securities") of Duke-Weeks Realty Corporation (the
"Company") and Duke-Weeks Realty Limited Partnership, any or all
pre-effective amendments or post-effective amendments to the Registration
Statement (which amendments may make such changes in and additions to the
Registration Statement as such attorneys-in-fact may deem necessary or
appropriate), and any registration statement for the offering that is to be
effective upon filing pursuant to Rule 462(b) under the Securities Act of
1933, as amended, and to file the same, with exhibits thereto and other
documents in connection therewith, with the Securities and Exchange
Commission, granting unto each of such attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary in connection with such matters and hereby ratifying and
confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ Darell E. Zink, Jr.
---------------------------------
Darell E. Zink, Jr.
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ Barrington H. Branch
---------------------------------
Barrington H. Branch
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ William Cavanaugh III
---------------------------------
William Cavanaugh III
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ Charles R. Eitel
---------------------------------
Charles R. Eitel
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ William O. McCoy
---------------------------------
William O. McCoy
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ John W. Nelley, Jr.
---------------------------------
John W. Nelley, Jr.
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature
appears below hereby constitutes and appoints Thomas L. Hefner, Darell E.
Zink, Jr., Dennis D. Oklak and John R. Gaskin, and each of them, his
attorneys-in-fact and agents, with full power of substitution and
resubstitution for him in any and all capacities, to sign a Registration
Statement on Form S-3 under the Securities Act of 1933 (the "Registration
Statement") for the registration of various securities (the "Securities") of
Duke-Weeks Realty Corporation (the "Company") and Duke-Weeks Realty Limited
Partnership, any or all pre-effective amendments or post-effective amendments
to the Registration Statement (which amendments may make such changes in and
additions to the Registration Statement as such attorneys-in-fact may deem
necessary or appropriate), and any registration statement for the offering
that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto each of such attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby ratifying
and confirming all that each of such attorneys-in-fact and agents or his
substitute or substitutes may do or cause to be done by virtue hereof.
Dated: January 31, 2000 /s/ Thomas D. Senkbeil
---------------------------------
Thomas D. Senkbeil
