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Filed Pursuant to Rule 424(b)(3)
Registration No. 33-91070
PROSPECTUS
COLONIAL PROPERTIES TRUST
DIVIDEND REINVESTMENT AND SHARE PURCHASE PLAN
600,000 COMMON SHARES OF BENEFICIAL INTEREST,
PAR VALUE $.01 PER SHARE
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The Dividend Reinvestment and Share Purchase Plan (the "Plan") of Colonial
Properties Trust (the "Company") provides owners of the Company's Common Shares
of Beneficial Interest, par value $0.01 per share (the "Common Shares") and
holders of units of limited partnership interest ("Units") in Colonial Realty
Limited Partnership, a Delaware limited partnership (the "Operating
Partnership"), with a convenient and economical method of investing in Common
Shares. Purchases under the Plan will be made at a five percent (5%) discount
from the applicable market price of the Common Shares. (The discount may,
however, be reduced or eliminated at any time without prior notice to
participants.) A participant in the Plan may purchase additional Common Shares
by (i) reinvesting in Common Shares any cash dividends paid on all or less than
all Common Shares owned by the participant, (ii) investing in Common Shares any
cash distributions paid on all or less than all Units owned by the participant
or (iii) subject to eligibility and other limitations stated later in this
Prospectus, making optional cash payments subject to a minimum of $200 per
payment and a maximum of $25,000 per calendar year, whether or not the
participant's dividends or distributions are being reinvested. Eligible
participants may invest amounts in excess of the $25,000 limit with the prior
approval of the Company. See "Description of the Plan--Question 13."
The Plan will be administered by BankBoston, or any successor bank, trust
company, broker or other nominee as may from time to time be designated by the
Company (the "Plan Administrator"). The Plan Administrator will buy, at the
Company's discretion, newly issued Common Shares from the Company or Common
Shares in the open market (including negotiated transactions). The purchase
price of the Common Shares purchased directly from the Company will be 95% of
the average of the high and low sale prices of the Common Shares as reported on
the New York Stock Exchange (or other relevant trading market) for each of the
ten Trading Days immediately preceding the applicable Reinvestment Date (as
defined in this Prospectus) or Cash Investment Date (as defined in this
Prospectus), provided that the price per Common Share must be at least 95% of
the closing price of the Common Shares on the applicable Reinvestment Date or
Cash Investment Date. The purchase price of Common Shares purchased by the Plan
Administrator in the open market will be 95% of the weighted average of the
prices paid (including brokerage and related costs) for all Common Shares
purchased in the open market by the Plan Administrator on the applicable
Reinvestment Date or Cash Investment Date. On October 19, 1998, the closing
price of the Common Shares as reported on the New York Stock Exchange ("NYSE")
was $27.5625 per share. The Common Shares are listed on the NYSE under the
symbol "CLP."
To enroll in the Plan, simply complete the enclosed Authorization Card and
return it in the envelope provided. A broker, bank or other nominee may reinvest
dividends, but may not make optional cash payments, on behalf of beneficial
owners.
This prospectus relates to 600,000 Common Shares registered for sale under
the Plan. Participants should retain this Prospectus for future reference.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR
ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION
TO THE CONTRARY IS UNLAWFUL.
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This Prospectus does not constitute an offer to sell or a solicitation of an
offer to buy any of the securities offered hereby in any jurisdiction to any
person to whom it is unlawful to make such an offer or solicitation in such
jurisdiction.
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The date of this Prospectus is October 26, 1998.
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THE COMPANY
AS USED IN THIS SECTION, THE TERM "COMPANY" INCLUDES COLONIAL PROPERTIES
TRUST, AN ALABAMA REAL ESTATE INVESTMENT TRUST, AND ONE OR MORE OF ITS
SUBSIDIARIES (INCLUDING COLONIAL PROPERTIES HOLDING COMPANY, INC., COLONIAL
REALTY LIMITED PARTNERSHIP, COLONIAL PROPERTIES SERVICES LIMITED PARTNERSHIP AND
COLONIAL PROPERTIES SERVICES, INC.) OR, AS THE CONTEXT MAY REQUIRE, COLONIAL
PROPERTIES TRUST ONLY.
The Company is one of the largest owners, developers and operators of
multifamily, retail and office properties in the Sunbelt region of the United
States. It is a fully-integrated real estate company whose activities include
the ownership and operation of a portfolio of 102 properties located in Alabama,
Florida, Georgia, Mississippi, North Carolina, South Carolina, Tennessee, Texas
and Virginia, development of new properties and acquisitions of existing
properties. The Company is a self-administered equity REIT that, as of September
30, 1998 owns 47 garden-style multifamily apartment communities containing a
total of approximately 15,000 apartment units, 38 retail properties (including
13 regional malls, 2 "power centers" and 23 neighborhood shopping centers)
containing a total of approximately 11.7 million square feet of retail shopping
space, 17 office properties containing a total of approximately 2.7 million
square feet of office space, and certain parcels of land adjacent to or near
certain of these properties (collectively, the "Properties").
The Company, through Colonial Properties Holding Company, Inc., a wholly
owned subsidiary ("CPHC"), is the sole general partner of and, as of September
30, 1998, holds approximately 29% of the interests in, the Operating
Partnership. The Company intends to merge with CPHC prior to December 31, 1998,
thereby becoming the direct general partner of the Operating Partnership. The
Operating Partnership owns all of the Properties (or interests therein). The
Company conducts all of its business through CPHC, the Operating Partnership and
the Company's two management subsidiaries, Colonial Properties Services Limited
Partnership, which provides management services for the Company's properties,
and Colonial Properties Services, Inc., which provides management services for
properties owned by third parties. As sole general partner of the Operating
Partnership, the Company, through CPHC, has the exclusive power to manage and
conduct the business of the Operating Partnership, subject to certain limited
exceptions.
The Company's experienced staff of approximately 825 employees provides a
full range of real estate services from its headquarters in Birmingham, Alabama
and from six regional offices located in the Mobile, Huntsville and Montgomery,
Alabama, Orlando and Tampa, Florida and Atlanta, Georgia metropolitan areas.
The Company is an Alabama real estate investment trust. It was originally
formed in July 1993 as a Maryland real estate investment trust and reorganized
as an Alabama real estate investment trust in September 1995. The principal
executive offices of the Company are located at 2101 Sixth Avenue North, Suite
750, Birmingham, Alabama 35203, and its telephone number is (205) 250-8700.
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DESCRIPTION OF THE PLAN
THE PLAN
The following questions and answers set forth the provisions of and
constitute the Company's Dividend Reinvestment and Share Purchase Plan. Holders
of Common Shares and Units who do not participate in the Plan will continue to
receive cash dividends, if and as declared, or cash distributions in accordance
with the Operating Partnership Agreement, in the usual manner. The text of the
Plan is as follows:
PURPOSE
1. WHAT IS THE PURPOSE OF THE PLAN?
The Plan provides eligible holders of Common Shares and Units with a
convenient and economical method of investing in the Company's Common Shares at
a discount from the prevailing market price. The Plan is intended to benefit
long-term investors in the Company and/or the Operating Partnership who wish to
increase their investment in Common Shares. The Plan will also assist the
Company in raising funds for general business purposes, to the extent that
Common Shares are purchased from the Company rather than in the open market. If
the Common Shares are purchased from the Company, the Company, through CPHC,
will invest the proceeds of the purchase in the Operating Partnership in
exchange for a corresponding number of Units.
ELIGIBILITY
2. WHO IS ELIGIBLE TO PARTICIPATE IN THE PLAN?
(a) Shareholders who own Common Shares registered in their own names on the
share transfer books of the Company or who own whole Common Shares held in their
Plan account ("Record Owners") are eligible to participate directly in the Plan.
Shareholders who hold Common Shares that are registered in someone else's name
(for example, in the name of a broker, bank or other nominee) ("Beneficial
Owners") who wish to participate in the Plan should either (i) make arrangements
with their broker, bank or other nominee to participate in the Plan on their
behalf or (ii) become Record Owners by arranging with their broker, bank or
other nominee to have their Common Shares transferred into their own names. Both
Record Owners and Beneficial Owners are eligible to participate in the dividend
reinvestment feature of the Plan. Brokers or banks holding Common Shares as
nominee may participate in the dividend reinvestment feature of the Plan through
Depository Trust Company Dividend Reinvestment Service. Only Record Owners may
participate in the optional cash payment feature of the Plan. Beneficial Owners
who wish to make optional cash payments under the plan should become Record
Owners as described above.
(b) Unitholders are eligible to invest cash distributions from the Operating
Partnership in the Company's Common Shares in accordance with the Plan.
Unitholders also may participate in the optional cash payment feature of the
Plan for the purchase of additional Common Shares.
Record Owners who participate in the Plan directly, brokers, banks and other
nominees who participate in the dividend reinvestment feature of the Plan on
behalf of Beneficial Owners, and unitholders who choose to participate are
sometimes referred to hereinafter as "Participants."
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Shareholders and unitholders who reside in jurisdictions in which it is
unlawful for the Company to permit their participation are not eligible to
participate in the Plan. The Company also may exclude shareholders and
unitholders who reside in jurisdictions that require registration of the Common
Shares or of the Company's officers, trustees or employees as agents in
connection with sales pursuant to the Plan. Shareholders and unitholders who are
citizens or residents of a country other than the United States, its territories
and possessions should make certain that their participation does not violate
local laws governing taxes, currency and exchange controls, share registration,
foreign investments or other matters. Purchases under the Plan also are subject
to the restrictions on share ownership set forth in the Company's Declaration of
Trust, which generally prohibits persons from owning (directly or by
attribution) more than 5% of the Company's outstanding Common Shares.
ADVANTAGES AND DISADVANTAGES TO PARTICIPANTS
3. WHAT ARE THE ADVANTAGES OF THE PLAN?
(a) The Plan provides Participants with the opportunity to reinvest cash
dividends paid on all or a portion of their Common Shares, or cash distributions
paid on all or a portion of their Units, in additional Common Shares. If
eligible, Participants may also purchase additional Common Shares through
optional cash payments.
(b) The price per share for Common Shares purchased for Participants in the
Plan will reflect a discount of 5% from the market price (calculated in
accordance with Question 16).
(c) All cash dividends or distributions paid on Participants' Common Shares
and/or Units and all optional cash payments made by a Participant can be fully
invested in additional Common Shares because the Plan permits fractional share
interests to be credited to Plan accounts. In addition, dividends will be paid
on, and may be reinvested with respect to, such fractional share interests.
(d) The Plan Administrator, at no charge to Participants, provides for the
safekeeping of certificates for shares credited to each Plan account.
(e) Periodic statements reflecting all current activity, including share
purchases and latest Plan account balance, simplify recordkeeping for
Participants.
4. WHAT ARE THE DISADVANTAGES OF THE PLAN?
(a) Participants who reinvest dividends paid on Common Shares will be
treated for federal income tax purposes as having received a dividend but will
not receive cash to pay any tax payment obligation.
(b) The income tax treatment of distributions paid on Units that are
reinvested under the Plan is unclear because there is no clear legal authority
regarding the income tax treatment of a limited partner in a partnership who
invests cash distributions from the partnership in shares of another entity.
(c) Participants will have limited control regarding the specific timing of
purchases and sales under the Plan.
(d) The price per share for Common Shares purchased from the Company will
reflect a discount of 5% from the average of the high and low sale prices of the
Common Shares on the NYSE for each of the ten Trading Days preceding the date of
purchase, provided that the purchase price may not be less than 95% of the
closing price of the Common Shares on the date of purchase. Where the average
price of the Common Shares during the ten preceding Trading Days is sufficiently
higher than the price of the
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Common Shares on the date of purchase, the purchase price may be greater than
the market price of the Common Shares on the date of purchase.
ADMINISTRATION
5. WHO ADMINISTERS THE PLAN FOR PARTICIPANTS?
BankBoston, as Plan Administrator, is responsible for administering the
Plan. The Plan Administrator keeps records, sends statements of account to each
Participant and performs other duties related to the Plan. The Plan
Administrator also acts as the dividend disbursing agent, paying agent, transfer
agent and registrar for the Common Shares. The Company may replace the Plan
Administrator at any time.
Although the Plan Administrator generally administers the Plan, unitholders
may initiate and terminate their participation in the Plan only by notifying the
Operating Partnership at the address set forth below.
PARTICIPATION BY SHAREHOLDERS AND UNITHOLDERS
6. HOW DOES AN ELIGIBLE HOLDER OF COMMON SHARES OR UNITS ENROLL IN THE PLAN AND
BECOME A PARTICIPANT?
A Record Owner may enroll in the Plan by completing and signing an
Authorization Card and returning it to the Plan Administrator. If Common Shares
are registered in more than one name (e.g., joint tenants or trustees), all
Record Owners must sign the Authorization Card exactly as their names appear on
the account registration. An eligible unitholder may enroll in the Plan by
completing and signing an Authorization Card and returning it to the Operating
Partnership. If Units are registered in more than one name, all owners of the
Units must sign the Authorization Card exactly as their names appear on the
account registration.
Beneficial Owners who wish to have their broker, bank or other nominee
participate in the Plan on their behalf should communicate with their broker,
bank or other nominee for information regarding how to do so. Brokers or banks
holding Common Shares as nominee may participate in the Plan through Depository
Trust Company Dividend Reinvestment Service.
Written requests for Authorization Cards, completed Authorization Cards and
cash payment forms, optional cash payments, notices of withdrawal and all other
communications by holders of Common Shares should be sent to the Plan
Administrator at:
BankBoston N.A.
c/o Boston EquiServe
P.O. Box 8040
Boston, Massachusetts 02266-8040
Participants may telephone the Plan Administrator between 8:00 a.m. and 7:00
p.m. Eastern Time at:
(800) 730-6001 or (781) 575-3120
PLEASE MENTION COLONIAL PROPERTIES TRUST AND YOUR ACCOUNT NUMBER IN ALL
CORRESPONDENCE.
Unitholders should forward all optional cash payments and requests for
account information directly to the Plan Administrator at the address above, but
all other communications by unitholders, including
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requests for completed Authorization Cards and notices of termination, should be
sent to the Operating Partnership at:
Colonial Realty Limited Partnership
2101 Sixth Avenue North, Suite 750
Birmingham, Alabama 35203
Telephone number: (205) 250-8700
7. WHEN MAY AN ELIGIBLE SHAREHOLDER OR UNITHOLDER ENROLL IN THE PLAN?
An eligible shareholder or unitholder may enroll in the Plan at any time.
Once an Authorization Card is received by the Plan Administrator or, if
applicable, the Operating Partnership, a Participant will remain enrolled in the
Plan until such Participant discontinues participation or until the Plan is
terminated.
8. HOW DOES A PARTICIPANT INDICATE THE EXTENT OF HIS OR HER PARTICIPATION IN THE
PLAN?
The Authorization Card allows each eligible shareholder or unitholder to
determine the extent to which he or she wants to participate in the Plan. The
Authorization Card appoints the Plan Administrator as agent for the Participant
and, if a dividend or distribution investment option is selected, directs the
Company or the Operating Partnership to pay to the Plan Administrator, for
investment in Common Shares, (i) any cash dividends paid on all or a specified
portion of Common Shares owned by the Participant on the applicable record date
("Participating Shares") or (ii) any cash distributions paid by the Operating
Partnership on all or a portion of the Units owned by the Participant on the
applicable record date ("Participating Units"). Participating Shares may include
shares held as Record Owner, shares deposited with the Plan Administrator for
safekeeping, and shares purchased pursuant to the Plan. (Shares held as
Beneficial Owner may participate only through arrangements made with the nominee
Record Owner.) Dividends or distributions will continue to be invested in Common
Shares until the Participant specifies otherwise or terminates participation, or
the Plan is terminated.
Participants may purchase additional Common Shares under the Plan by
electing one of the following investment options:
(1) "FULL DIVIDEND/DISTRIBUTION INVESTMENT" directs the Plan
Administrator to invest dividends or distributions on all of a Participant's
Participating Shares and/or Participating Units (including whole and
fractional shares acquired under the Plan), and permits a Participant to
make optional cash payments for the purchase of additional Common Shares in
accordance with the Plan.
(2) "PARTIAL DIVIDEND/DISTRIBUTION INVESTMENT" directs the Plan
Administrator to remit cash dividends or distributions to the Participant on
the number of whole Common Shares or Units owned by the Participant
specified on the Authorization Card and to invest in additional Common
Shares any dividends or distributions paid on remaining Common Shares or
Units owned by the Participant (including shares held or acquired under the
Plan). This investment option also permits a Participant to make optional
cash payments for the purchase of additional Common Shares in accordance
with the Plan.
(3) "OPTIONAL CASH PAYMENTS ONLY" permits a Participant to make optional
cash payments for the purchase of additional Common Shares in accordance
with the Plan. Under this investment option, all cash dividends on whole and
fractional shares or distributions on Units owned by the Participant will be
remitted to the Participant.
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Any shareholder, whether or not a Record Owner, may select option (1) or
(2); only Record Owners, however, may make optional cash payments under those
options. In addition, only Record Owners may select option (3). Unitholders may
select option (1), (2) or (3). If a Participant returns a properly executed
Authorization Card to the Plan Administrator or, if applicable, the Operating
Partnership without electing an investment option, the Authorization Card will
be deemed to indicate the intention of the Participant to select option (1).
9. MAY A PARTICIPANT CHANGE THE EXTENT OF HIS OR HER PARTICIPATION IN THE PLAN?
Participants may change their investment option under the Plan at any time
by requesting a new Authorization Card from, and returning it to, the Plan
Administrator or, if applicable, the Operating Partnership, at the addresses set
forth in Question 5.
10. WHAT IS THE SOURCE OF THE COMMON SHARES PURCHASED UNDER THE PLAN?
Common Shares purchased for a Participant's account under the Plan may be
purchased by the Plan Administrator, at the Company's discretion, either (a)
from the Company out of its authorized but unissued shares or treasury shares or
(b) in the open market (on the NYSE or any securities exchange where Common
Shares are then traded, in the over-the-counter market or in negotiated
transactions). In the event the Common Shares are purchased from the Company,
the Company will use the proceeds of that purchase to acquire a corresponding
number of Units in the Operating Partnership.
11. WHEN WILL DIVIDENDS/DISTRIBUTIONS BE INVESTED?
If the Plan Administrator purchases Common Shares directly from the Company,
dividends will be invested on the dividend payment date fixed by the Board of
Trustees of the Company, and distributions will be invested on the distribution
payment date fixed by CPHC, as general partner of the Operating Partnership in
accordance with the Operating Partnership Agreement, unless that day is not a
day on which the NYSE is open for trading (a "Trading Day"), in which case
dividends or distributions will be invested on the preceding Trading Day. If
Common Shares are purchased in the open market, the Plan Administrator will make
such purchases as soon as possible on or after the dividend payment date or
distribution payment date, in all events within 30 days after such date, on
terms and at prices determined by the Plan Administrator. The date on which an
investment of dividends or distributions occurs or commences is referred to
hereinafter as a "Reinvestment Date."
For an election to invest dividends or distributions under the Plan to be
effective with respect to a particular cash dividend or cash distribution, an
Authorization Card must be received by the Plan Administrator or, if applicable,
the Operating Partnership, at least two business days before the record date
established for that dividend or distribution. If the Authorization Card is
received later than two business days before the applicable record date, the
investment of dividends or distributions will begin on the next Reinvestment
Date.
NO INTEREST WILL BE PAID BY THE COMPANY OR THE PLAN ADMINISTRATOR ON ANY
DIVIDENDS OR DISTRIBUTIONS HELD PENDING INVESTMENT.
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OPTIONAL CASH INVESTMENTS
12. WHO MAY MAKE OPTIONAL CASH PAYMENTS UNDER THE PLAN?
All Record Owners of Common Shares and all unitholders who have submitted an
Authorization Card, whether or not they have authorized the investment of
dividends or distributions, are eligible to make optional cash payments under
the Plan. Participants who are brokers, banks or nominees participating on
behalf of a Beneficial Owner may not make any optional cash payments. A
BENEFICIAL OWNER WHO WISHES TO MAKE OPTIONAL CASH PAYMENTS SHOULD BECOME A
RECORD OWNER BY TRANSFERRING ALL OR SOME OF HIS OR HER COMMON SHARES INTO HIS OR
HER OWN NAME.
13. WHAT ARE THE LIMITATIONS ON MAKING OPTIONAL CASH PAYMENTS?
Each optional cash payment is subject to a minimum purchase limit of $200
per payment and a maximum purchase limit of $25,000 per year. In addition, the
number of Common Shares that may be purchased by a Participant with optional
cash payments is limited, on each Cash Investment Date, to the number of shares
and Units owned by the Participant on that date. For purposes of these
limitations, all Plan accounts under the common control or management of a
Participant will be aggregated. The Plan Administrator will return optional cash
payments submitted by a Participant to the extent that (i) the payment is less
than $200 or, when combined with all other optional cash payments made by the
Participant during the calendar year, exceeds $25,000 or (ii) the number of
Common Shares that could be purchased for the Participant exceeds the number of
Common Shares and Units then owned by the Participant. Participants eligible to
make optional cash payments may invest amounts in excess of the $25,000 limit
with the prior approval of the Company. Requests for such prior approval should
be directed to the Chief Financial Officer of the Company.
THERE IS NO OBLIGATION TO USE, NOR ANY PENALTY FOR NOT USING, THE OPTIONAL
CASH PAYMENT FEATURE OF THE PLAN. PARTICIPANTS WHO ELECT TO UTILIZE THIS FEATURE
NEED NOT MAKE A PAYMENT EACH MONTH, AND NEED NOT SEND THE SAME AMOUNT OF MONEY
IN EACH PAYMENT.
14. WHEN WILL OPTIONAL CASH PAYMENTS RECEIVED BY THE PLAN ADMINISTRATOR BE
INVESTED?
Optional cash payments will be invested monthly on or about the cash
investment date (the "Cash Investment Date"). In each month in which the Company
pays a dividend on the Common Shares, the Cash Investment Date will be the same
date as the Reinvestment Date. In each month in which the Company does not pay a
dividend, the Cash Investment Date will be the tenth day of the month or, if
that day is not a Trading Day, the preceding Trading Day. If the Plan
Administrator purchases shares directly from the Company, the purchase of shares
will occur on or about the applicable Cash Investment Date. If Common Shares are
to be purchased in the open market, the Plan Administrator will make such
purchases as soon as possible on or after the applicable Cash Investment Date,
in all events within 30 days after that date, and on terms and at prices
determined by the Plan Administrator. To be invested on an upcoming Cash
Investment Date, optional cash payments must be received by the Plan
Administrator no later than five Trading Days prior to that Cash Investment
Date. Late payments will be invested on the next subsequent Cash Investment
Date.
NO INTEREST WILL BE PAID BY THE COMPANY OR THE PLAN ADMINISTRATOR ON ANY
OPTIONAL CASH DEPOSITS HELD PENDING INVESTMENT.
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15. MAY OPTIONAL CASH PAYMENTS BE RETURNED TO A PARTICIPANT?
Yes. Upon written request received by the Plan Administrator at least two
business days prior to the Cash Investment Date on which a Participant's
optional cash payment would otherwise be invested, optional cash payments will
be returned to the Participant. OPTIONAL CASH PAYMENTS WILL BE RETURNED WITHOUT
INTEREST.
PURCHASES
16. WHAT WILL BE THE PRICE OF COMMON SHARES PURCHASED UNDER THE PLAN?
The price per Common Share purchased from the Company under the Plan will be
equal to 95% of the average of the high and low sale prices of the Common Shares
as reported on the NYSE (or other relevant trading market) for each of the ten
Trading Days immediately preceding the applicable Reinvestment Date or Cash
Investment Date, provided that in no event will the price per Common Share be
less than 95% of the closing price of the Common Shares as reported on the NYSE
on the applicable Reinvestment Date or Cash Investment Date. If there are no
sales of Common Shares on one or more of the ten Trading Days prior to the date
of purchase, the average will be based on the high and low sale prices on those
days within the ten Trading Day period on which the Common Shares do trade.
In the event that the Plan Administrator purchases shares in the open market
rather than from the Company, the price per Common Share purchased under the
Plan will be equal to 95% of the weighted average price per share of all Common
Shares purchased by the Plan Administrator for the applicable Reinvestment Date
or Cash Investment Date. The average price per share of all Common Shares
purchased in the open market will include a pro rata portion of all brokerage
and related costs incurred in connection with the open market purchases. See the
discussion in Question 18.
The Company could, at any time, reduce or eliminate the discount without
prior notice to Participants for any reason, including the Company's belief that
Participants were engaging in positioning and other transactions with the intent
to purchase Common Shares under the Plan and then immediately resell such Common
Shares in order to capture the discount. Any Participants who engage in such
positioning or other transactions may be deemed to be underwriters within the
meaning of Section 2(11) of the Securities Act of 1933, as amended.
17. HOW WILL THE NUMBER OF COMMON SHARES PURCHASED FOR A PARTICIPANT BE
DETERMINED?
A Participant's account in the Plan will be credited, on each Reinvestment
Date and Cash Investment Date, with that number of Common Shares, plus
fractional share interests computed to three decimal places, equal to the total
amount of cash to be invested on behalf of the Participant on that date divided
by the discounted purchase price per Common Share for that date. The total
amount of cash to be invested will depend on the amount of any dividends or
distributions paid on the number of Participating Shares or Participating Units
designated by the Participant and the amount of optional cash payments (if any)
made by the Participant.
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COSTS
18. ARE THERE ANY EXPENSES TO PARTICIPANTS IN CONNECTION WITH THEIR
PARTICIPATION IN THE PLAN?
Because of restrictions imposed on the Company by provisions of the Internal
Revenue Code applicable to real estate investment trusts, the Company is not
able to sell its Common Shares at a discount of more than five percent. These
restrictions also require that brokerage commissions and related charges be
treated as part of the discount if those charges are paid by the Company.
Accordingly, for shares purchased in the open market, the average price per
share of all Common Shares to which the five percent discount applies will
include a pro rata portion of all brokerage and related costs, so that the
overall discount to Participants will not exceed five percent. No brokerage
commissions will be incurred in connection with purchases of Common Shares
directly from the Company. (To date, all purchases under the Plan have been made
directly from the Company.) All other costs of administration of the Plan will
be paid by the Company (and reimbursed to the Company by the Operating
Partnership). However, Participants who request that the Plan Administrator sell
their shares or fractional share interests must pay any related brokerage
commissions and transfer taxes.
REPORTS TO PARTICIPANTS
19. WHAT KINDS OF REPORTS WILL BE SENT TO PARTICIPANTS?
As soon as practical after each purchase of Common Shares on behalf of a
Participant, a statement of account will be mailed to such Participant. These
statements, which provide a record of account activity and account balance and
indicate the cost of such Participant's purchases under the Plan, should be
retained for tax purposes. In addition, each Participant will receive, from time
to time, communications sent to every other holder of Common Shares.
Each Participant will receive annually Internal Revenue Service information
(on Form 1099) for reporting dividend income received.
CUSTODIAL SERVICE
20. MAY PARTICIPANTS DEPOSIT THEIR COMMON SHARES WITH THE PLAN ADMINISTRATOR?
Yes. Participants have the option of delivering to the Plan Administrator
for safekeeping share certificates representing their Common Shares.
Participants may deliver their certificates to the Plan Administrator along with
the Authorization Card when enrolling in the Plan, or may do so at any time
thereafter while participating in the Plan. Share certificates must be endorsed
by, or accompanied by an appropriate instrument of transfer executed by, the
Participant (or his authorized representative) when delivered to the Plan
Administrator for safekeeping. The number of Common Shares represented by share
certificates delivered by a Participant to the Plan Administrator for
safekeeping will be credited to a Participant's Plan account. The Plan
Administrator may maintain shares represented by such share certificates in its
name or in the name of its nominee. The Plan Administrator will not provide such
services with respect to Unit certificates or interests.
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CERTIFICATES FOR SHARES
21. WILL CERTIFICATES BE ISSUED TO PARTICIPANTS FOR COMMON SHARES PURCHASED
UNDER THE PLAN?
No. Common Shares purchased under the Plan will be credited to a
Participant's Plan account and will be held in the name of the Plan
Administrator or its nominee. This service protects against loss, theft or
destruction of share certificates evidencing Common Shares purchased under the
Plan. However, share certificates will be issued to any Participant upon written
request.
22. HOW MAY A PARTICIPANT OBTAIN A CERTIFICATE REPRESENTING COMMON SHARES HELD
IN HIS OR HER PLAN ACCOUNT?
Shares held in a Participant's Plan account may be withdrawn by a
Participant by notifying the Plan Administrator in writing or by calling the
Plan Administrator at the number listed in Question 6, specifying the number of
shares to be withdrawn. The Plan Administrator will process a request for
withdrawal within five days of receipt. A share certificate for the number of
whole shares so withdrawn will be issued to the Participant. A certificate will
not be issued for any fractional share interest credited to a Participant's Plan
account. Instead, a Participant will receive a check for the value of any
fractional share interest, based upon the then current market price of the
Common Shares, less any related brokerage commissions or transfer taxes.
23. WILL DIVIDENDS ON SHARES DELIVERED TO A PARTICIPANT BY THE PLAN
ADMINISTRATOR CONTINUE TO BE INVESTED?
If the Participant who is a shareholder has authorized "Full Dividend
Investment," cash dividends with respect to shares delivered to a Participant by
the Plan Administrator will continue to be invested. If, however, cash dividends
with respect to only a portion of the Common Shares registered in a
Participant's name or owned by a Participant as Plan Shares are being invested,
the Plan Administrator will continue to invest dividends on only the number of
Participating Shares specified by the Participant on the Authorization Card
unless a new Authorization Card specifying a different number of Common Shares
is delivered to the Plan Administrator. Similarly, if a Participant who is a
unitholder has authorized the investment of cash distributions with respect to
only a portion of the Units owned by such Participant, the Participant will
continue to receive cash distributions on only the number of Units specified by
the Participant on the Authorization Card unless a new Authorization Card
specifying a different number of Units is delivered to the Operating
Partnership.
SALE OF PLAN SHARES
24. MAY PLAN SHARES BE SOLD THROUGH THE PLAN ADMINISTRATOR?
A Participant may instruct the Plan Administrator to sell any or all of the
whole Common Shares held in such Participant's Plan account. The instruction to
sell must specify the number of shares to be sold (not a dollar amount to be
raised) and, in the case of a request to sell submitted on behalf of a
Participant who has died or is an adjudicated incompetent, must be accompanied
by certified evidence of the representative's authority to request a sale of the
Participant's shares. A Participant may not direct the date on which or the
price at which shares held in such Participant's account may be sold. A
withdrawal/termination form for this purpose is provided on the reverse side of
each account statement sent to Participants.
Within five Trading Days following receipt of written instructions to sell,
the Common Shares held in the Participant's account will be sold at the
prevailing market price, and the proceeds of sale, less applicable brokerage
commissions, transfer taxes, and a nominal administrative fee ($10 as of the
date of this Prospectus) will be remitted to the Participant or the
Participant's representative.
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TERMINATION OF PARTICIPATION IN THE PLAN
25. HOW AND WHEN MAY A PARTICIPANT TERMINATE PARTICIPATION IN THE PLAN?
Participation in the Plan may be terminated at any time by providing written
notice to the Plan Administrator or, if applicable, the Operating Partnership.
Participants who participate in the dividend/ distribution investment feature of
the Plan must provide such notice at least two business days before the next
dividend or distribution record date. Participation in the Plan will also be
terminated if the Plan Administrator or, if applicable, the Operating
Partnership receives written notice from the trustee or executor of a
Participant's estate of the death or adjudicated incompetency of the Participant
at least two business days before the next record date for a dividend or
distribution payment. In the event written notice of termination, death or
adjudicated incompetency is received by the Plan Administrator or, if
applicable, the Operating Partnership, less than two business days before the
next dividend or distribution record date, Common Shares will be purchased for
the Participant with the related cash dividend or cash distribution, and
participation in the Plan will not terminate until after such investment has
occurred. Upon termination by reason of notice of death or adjudicated
incompetency, the Participant's shares and any cash dividends paid thereon will
be retained by the Plan Administrator until such time as the Participant's legal
representative has been appointed and has furnished proof satisfactory to the
Plan Administrator or, if applicable, the Operating Partnership, of the legal
representative's rights to receive payment.
Upon termination of participation in the Plan, unless a Participant has
requested that some or all of the shares held in his or her account be sold, the
Plan Administrator will send such Participant a share certificate for the number
of whole Common Shares in such Participant's account and a check in an amount
equal to the value of any fractional share interest, based upon the then current
market price of the Common Shares, less any related brokerage commissions or
transfer taxes.
In addition, participation in the Plan will be automatically terminated as
to any Participant who holds no shares in his or her Plan account and has no
Common Shares registered in his or her own name. In the event that a
Participant's participation in the Plan is terminated for this reason, the Plan
Administrator will send such Participant a check in an amount equal to the value
of any fractional share interest credited to such Participant's Plan account,
based upon the then current market price of the Common Shares, less any related
brokerage commissions or transfer taxes.
RIGHTS OFFERINGS, SHARE DIVIDENDS AND SHARE SPLITS
26. IF THE COMPANY HAS A RIGHTS OFFERING, HOW WILL PARTICIPATION IN THE RIGHTS
OFFERING BE HANDLED FOR PARTICIPANTS?
Participation in any rights offering will be based upon Common Shares
registered in a Participant's name or held in a Participant's Plan account, but
not on fractional share interests credited to a Participant's Plan account.
27. WHAT HAPPENS IF THE COMPANY ISSUES A DIVIDEND PAYABLE IN SHARES OR DECLARES
A SHARE SPLIT?
Any share dividends or split shares distributed by the Company on its Common
Shares will be credited pro rata to each Participant's Plan account based on the
number of shares held in the Participant's Plan account. Share dividends or
split shares distributed on Common Shares registered in a Participant's name
will be mailed directly to the Participant.
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VOTING RIGHTS
28. HOW WILL THE PLAN ADMINISTRATOR VOTE PLAN SHARES AT SHAREHOLDERS' MEETINGS?
For each meeting of shareholders, a Participant will receive proxy materials
that will enable the Participant to vote Plan Shares. Alternatively, a
Participant may vote such shares in person at the shareholders' meeting.
Fractional share interests credited to a Participant's account may not be voted
by proxy or in person.
FEDERAL INCOME TAX CONSEQUENCES TO PARTICIPANTS
The following summary is based upon an interpretation of current federal tax
law. THE INCOME TAX TREATMENT OF PARTICIPANTS IN THE PLAN WHO ARE UNITHOLDERS IS
UNCLEAR, BECAUSE, UNLIKE WITH COMMON SHARES, THERE IS NO LEGAL AUTHORITY
DIRECTLY ON POINT AS TO THE TREATMENT OF THIS TYPE OF PLAN FOR A PARTNER IN A
PARTNERSHIP. (See the discussion below). Participants should consult their own
tax advisors to determine particular tax consequences, including state income
tax (and non-income tax, such as transfer tax) consequences, which vary from
state to state, that may result from participation in the Plan and subsequent
disposition of shares acquired pursuant to the Plan. Income tax consequences to
Participants residing outside the United States will vary from jurisdiction to
jurisdiction.
29. WHAT ARE THE INCOME TAX CONSEQUENCES FOR SHAREHOLDERS OF PARTICIPATION IN
THE PLAN?
In the case of Common Shares purchased by the Plan Administrator from the
Company with reinvested dividends, a shareholder will be treated for federal
income tax purposes as having received a distribution (with respect to Common
Shares) equal to the fair market value on the Reinvestment Date of the Common
Shares credited to the shareholder's Plan account. The amount of the
distribution deemed to have been received may exceed the amount of the cash
dividend that was reinvested, due to the 5% discount described under Question
16.
In the case of Common Shares purchased by the Plan Administrator on the open
market, a shareholder will be treated for federal income tax purposes as having
received a distribution equal to the price paid by the Plan Administrator for
the Common Shares (including brokerage and related costs), which will exceed the
amount of cash otherwise distributable to the shareholder, due to the 5%
discount on the price paid by the Plan Administrator.
Any cash distribution to a shareholder which is not invested through the
Plan simply will be treated as cash distribution for federal income tax
purposes.
In the case of Common Shares purchased by the Plan Administrator from the
Company pursuant to the optional cash payment feature of the Plan, a shareholder
will be treated for federal income tax purposes as having received a
distribution (with respect to Common Shares) equal to the fair market value on
the Cash Investment Date of the Common Shares credited to the shareholder's Plan
account less the amount paid by the shareholder for the Common Shares. The fair
market value of the Common Shares on the Cash Investment Date may exceed the
actual purchase price of the Common Shares purchased from the Company due to the
5% discount described under Question 16.
In the case of Common Shares purchased by the Plan Administrator on the open
market pursuant to the optional cash payment feature of the Plan, a shareholder
will be treated for federal income tax
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<PAGE>
purposes as having received a distribution equal to the 5% discount on the price
paid (which includes brokerage and related costs) by the Plan Administrator for
the Common Shares.
Any distribution described above will be treated for federal income tax
purposes as a dividend to the extent the Company has current or accumulated
earnings and profits. Distributions in excess of current or accumulated earnings
and profits will not be taxable to a shareholder to the extent that such
distributions do not exceed the adjusted basis of the shareholder's Common
Shares. To the extent such distributions exceed the adjusted basis of a
shareholder's Common Shares, they will be included in income as a capital gain
if the Common Share has been held by the shareholder as a capital asset and will
be either long or short term depending on whether the shareholder's holding
period for his Common Share is or is not more than one year.
30. WHAT ARE THE INCOME TAX CONSEQUENCES FOR UNITHOLDERS OF PARTICIPATION IN THE
PLAN?
The income tax treatment of unitholders who participate in the Plan is
unclear because, unlike with a stock dividend reinvestment plan, there is no
clear legal authority regarding the income tax treatment of a limited partner in
a partnership who invests cash distributions from the partnership in stock of
another entity that is a partner in the partnership. The following, however,
sets forth the Company's view of the likely tax treatment of unitholders who
participate in the Plan, and absent the promulgation of authority to the
contrary, the Company and the Operating Partnership intend to report the tax
consequences of a unitholder's participation in a manner consistent with the
following.
In the case of Common Shares purchased by the Plan Administrator from the
Company, whether through the investment of a unitholder's distribution or
through an optional cash payment by a unitholder, a unitholder likely will be
treated for federal income tax purposes as having received a cash distribution
(in addition to the invested distribution, if applicable) from the Operating
Partnership equal to the fair market value on the Reinvestment Date or Cash
Investment Date, respectively, of the Common Shares credited to the unitholder's
account less the amount of cash paid by the unitholder for the Common Shares
(i.e., the amount of the cash distribution or the optional cash payment), if
any. The fair market value of the Common Shares on the Reinvestment Date or the
Cash Investment Date may exceed the purchase price of the Common Shares
purchased from the Company due to the 5% discount described under Question 16.
In the case of Common Shares purchased by the Plan Administrator on the open
market pursuant to a unitholder's distribution or the optional cash payment
feature of the Plan, a unitholder likely will be treated for federal income tax
purposes as having received a cash distribution (in addition to the invested
distribution, if applicable) from the Operating Partnership equal to the 5%
discount on the price paid (which includes brokerage and related costs) by the
Plan Administrator for the Common Shares.
A cash distribution from the Operating Partnership will reduce a
unitholder's basis in his Units by the amount distributed. Cash distributed to a
unitholder in excess of his basis in his Units generally will be taxable as
capital gain, either long- or short-term, depending on whether the unitholder's
holding period for his Units is or is not more than one year. However, under
Section 751(b) of the Code, to the extent a distribution is considered to be in
exchange for a unitholder's interest in substantially appreciated inventory
items or unrealized receivables of the Operating Partnership, that unitholder
may recognize ordinary income rather than a capital gain.
31. WHAT ARE THE INCOME TAX CONSEQUENCES FOR PARTICIPANTS UPON THE RECEIPT
OF CERTIFICATES?
A Participant will not realize any taxable income upon receipt of
certificates for whole shares credited to the Participant's account, either upon
the Participant's request for certain of those shares or upon
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termination of participation in the Plan. A Participant will realize gain or
loss upon the sale or exchange of shares acquired under the Plan. A Participant
will also realize gain or loss upon receipt, following termination of
participation in the Plan, of a cash payment for any fractional share interest
credited to the Participant's account. The amount of any such gain or loss will
be the difference between the amount that the Participant received for the
shares or fractional share interest and the tax basis therefor.
32. HOW ARE INCOME TAX WITHHOLDING PROVISIONS APPLIED TO UNITHOLDERS AND
SHAREHOLDERS WHO PARTICIPATE IN THE PLAN?
If a Participant fails to provide certain federal income tax certifications
in the manner required by law, any cash dividends on Common Shares (including
cash dividends that are reinvested), proceeds from the sale of fractional share
interests and proceeds from the sale of shares held for the Participant's
account will be subject to federal income tax withholding at the rate of 31%. If
withholding is required for any reason, the appropriate amount of tax will be
withheld. Certain shareholders (including most corporations) are, however,
exempt from the above withholding requirements.
If a Participant is a foreign shareholder whose dividends are subject to
federal income tax withholding at the 30% rate (or a lower treaty rate), the
appropriate amount will be withheld and the balance in shares will be credited
to such Participant's account.
RESPONSIBILITY OF THE COMPANY AND THE PLAN ADMINISTRATOR
33. WHAT ARE THE RESPONSIBILITIES OF THE COMPANY AND THE PLAN ADMINISTRATOR
UNDER THE PLAN?
The Company is responsible for interpreting the Plan. Any questions of
interpretation arising under the Plan will be determined by the Company, and any
such determination will be final. The Company may adopt rules and regulations to
facilitate the administration of the Plan. The terms and conditions of the Plan
and its operation will be governed by the laws of the State of Alabama. Neither
the Company, the Operating Partnership nor the Plan Administrator will be liable
for any act done in good faith or for any good faith omission to act, including,
without limitation, any claim of liability (a) arising out of failure to
terminate a Participant's account upon such Participant's death prior to timely
receipt by the Plan Administrator of written notice of such death, (b) with
respect to the prices at which Common Shares are purchased or sold for the
Participant's account or the times at which such purchases or sales are made or
(c) with respect to fluctuations in the market value of the Common Shares before
or after any purchase or sale of Common Shares.
SUSPENSION, MODIFICATION OR TERMINATION OF THE PLAN
34. MAY THE PLAN BE SUSPENDED, MODIFIED OR TERMINATED?
The Company may suspend or terminate the Plan at any time, including during
the period between a record date and the related Investment Date. Participants
will be notified of any such suspension or termination. The Company also may
make modifications to the Plan and, in such event, will provide Participants
with a copy of any material modification. Upon termination of the Plan, a share
certificate for whole shares credited to each Participant's Plan account will be
issued, and a cash payment will be made for any fractional share interest
credited to each such account, unless the Company terminates the Plan for the
purpose of establishing another dividend reinvestment plan, in which case
Participants will be
15
<PAGE>
automatically enrolled in such other plan, and shares credited to their Plan
accounts will be credited automatically to such other plan.
The Company and the Plan Administrator may terminate any Participant's
participation in the Plan at any time for any reason.
OTHER INFORMATION
35. HOW MAY PARTICIPANTS OBTAIN ANSWERS TO QUESTIONS CONCERNING THEIR PLAN
ACCOUNTS?
Questions concerning Plan accounts should be addressed to the Plan
Administrator at the address and telephone number provided in Question 6.
36. HOW MAY SHAREHOLDERS OBTAIN ANSWERS TO OTHER QUESTIONS REGARDING THE COMPANY
OR THE PLAN?
Questions concerning the Company or the Plan should be directed to:
Colonial Properties Trust
Attention: Investor Relations
2101 Sixth Avenue North, Suite 750
Birmingham, Alabama 35203
Telephone number: (205) 250-8700
37. WHO BEARS THE RISK OF MARKET FLUCTUATIONS IN THE COMMON SHARES?
A Participant's investment in shares held in his or her Plan account is no
different than his or her investment in directly held shares in this regard.
Each Participant bears all risk of loss that may result from market fluctuations
in the price of Common Shares.
Neither the Company nor the Plan Administrator can guarantee that Common
Shares purchased under the Plan will, at any particular time, be worth more or
less than their purchase price.
USE OF PROCEEDS
Any proceeds received by the Company upon the Plan Administrator's purchase
of Common Shares directly from the Company will be used to acquire a
corresponding number of Units from the Operating Partnership, which will use
such proceeds for general business purposes. The Company has no basis for
estimating either the number of Common Shares that will be sold directly by the
Company pursuant to the Plan or the prices at which such Common Shares will be
sold. The Company will not receive any proceeds from purchases of Common Shares
by the Plan Administrator in the open market.
EXPERTS
The Consolidated Statements of Operations, Balance Sheets, Statements of
Shareholders' Equity and Statements of Cash Flows and Schedules of the Company
for each of the years ended December 31, 1995, 1996 and 1997 have been
incorporated herein by reference in reliance on the reports of
PricewaterhouseCoopers LLP, independent certified public accountants, also
incorporated by reference herein, and upon the authority of said firm as experts
in accounting and auditing.
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<PAGE>
LEGAL MATTERS
The validity of the Common Shares offered hereby has been passed upon for
the Company by its counsel, Hogan & Hartson L.L.P., Washington, D.C. Hogan &
Hartson L.L.P. will rely on the opinion of Sirote & Permutt P.C., Birmingham,
Alabama, as to matters of Alabama law.
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement (of which this Prospectus is a part) on
Form S-3 under the Securities Act with respect to the securities offered hereby.
This Prospectus does not contain all the information set forth in the
Registration Statement, certain portions of which have been omitted as permitted
by the rules and regulations of the Commission. Statements contained in this
Prospectus as to the content of any contract or other document are not
necessarily complete, and in each instance reference is made to the copy of such
contract or other document filed as an exhibit to the Registration Statement,
each such statement being qualified in all respects by such reference and the
exhibits and schedules hereto. For further information regarding the Company and
the Common Shares offered hereby, reference is hereby made to the Registration
Statement and such exhibits and schedules.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). The Company files Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form
8-K and other reports and information with the Commission and is subject to the
periodic reporting and informational requirements of the Exchange Act. The
Registration Statement, the exhibits and schedules forming a part thereof as
well as such reports and other information filed by the Company with the
Commission can be inspected and copies obtained from the Commission at the SEC's
Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. The
public may obtain information on the operation of the Public Reference Room by
calling the Commission at 1-800-SEC-0330. The Commission maintains a Web site
(http://www.sec.gov) that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission. In addition, the Company's Common Shares are listed on the NYSE, and
similar information concerning the Company can be inspected and copied at the
offices of the NYSE, 20 Broad Street, New York, New York 10005.
The Company furnishes its shareholders with annual reports containing
consolidated financial statements audited by its independent certified public
accountants and with quarterly reports containing unaudited condensed
consolidated financial statements for each of the first three quarters of each
fiscal year.
INCORPORATION BY REFERENCE
The documents listed below have been filed by the Company under the Exchange
Act with the Commission and are incorporated herein by reference:
(a) the Company's Annual Report on Form 10-K for the year ended December 31,
1997;
(b) the Company's Quarterly Reports on Form 10-Q for the periods ended March
31, 1998 and June 30, 1998;
(c) the Company's Current Reports on Form 8-K filed on February 11, 1998,
February 17, 1998, March 26, 1998, March 31, 1998, May 6, 1998, June 11, 1998
and July 8, 1998; and
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(d) the description of the Company's Common Shares contained in the
Company's Registration Statement on Form S-11 dated July 13, 1993, No. 33-65954
and incorporated by reference in the Company's Form 8-A dated September 20, 1993
and in the Company's proxy statement dated September 1, 1995.
All documents filed by the Company subsequent to the date of this Prospectus
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act and prior to
termination of the offering of the Common Shares to which this Prospectus
relates shall be deemed to be incorporated by reference in this Prospectus and
shall be part hereof from the date of filing of such document.
Any statement contained herein or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained in this
Prospectus (in the case of a statement in a previously filed document
incorporated or deemed to be incorporated by reference herein) or in any other
subsequently filed document that is also incorporated or deemed to be
incorporated by reference herein, modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus. Subject to the
foregoing, all information appearing in this Prospectus is qualified in its
entirety by the information appearing in the documents incorporated by
reference.
The Company will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus is delivered, upon the
written or oral request of such person, a copy of any or all of the documents
incorporated herein by reference (other than exhibits to such documents, unless
such exhibits are specifically incorporated by reference in such documents).
Written or telephonic requests for such copies should be directed to: Chief
Financial Officer, Colonial Properties Trust, 2101 Sixth Avenue North, Suite
750, Birmingham, Alabama 35203, telephone number (205) 250-8700.
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NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH ANY OFFERING TO BE MADE BY THE
PROSPECTUS. IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY, THE
SECURITIES, IN ANY JURISDICTION WHERE, OR TO ANY PERSON TO WHOM, IT IS UNLAWFUL
TO MAKE ANY SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS
NOR ANY OFFER OR SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCE, CREATE AN
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE FACTS SET FORTH IN THIS
PROSPECTUS OR IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
THE COMPANY...................................... 2
DESCRIPTION OF THE PLAN.......................... 3
The Plan....................................... 3
Purpose........................................ 3
Eligibility.................................... 3
Advantages and Disadvantages to Participants... 4
Administration................................. 5
Participation by Shareholders and
Unitholders.................................. 5
Optional Cash Investments...................... 8
Purchases...................................... 9
Costs.......................................... 10
Reports to Participants........................ 10
Custodial Service.............................. 10
Certificates for Shares........................ 11
Sale of Plan Shares............................ 11
Termination of Participation
in the Plan.................................. 12
Rights Offerings, Share Dividends and Share
Splits....................................... 12
Voting Rights.................................. 13
Federal Income Tax Consequences to
Participants................................. 13
Responsibility of the Company and the Plan
Administrator................................ 15
Suspension, Modification or Termination of the
Plan......................................... 15
Other Information.............................. 16
USE OF PROCEEDS.................................. 16
EXPERTS.......................................... 16
LEGAL MATTERS.................................... 17
AVAILABLE INFORMATION............................ 17
INCORPORATION BY REFERENCE....................... 17
</TABLE>
COLONIAL PROPERTIES TRUST
600,000 COMMON SHARES
OF BENEFICIAL INTEREST
($.01 PAR VALUE)
---------------------
PROSPECTUS
---------------------
DIVIDEND REINVESTMENT AND
SHARE PURCHASE PLAN
OCTOBER 26, 1998
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