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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------------------------
FORM 8-K
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report: DECEMBER 5, 1997
(Date of earliest event reported) (December 2, 1997)
ESSEX PROPERTY TRUST, INC.
(Exact name of Registrant as
Specified in its Charter)
MARYLAND
(State or Other Jurisdiction
of Incorporation)
1-13106
(Commission File Number)
77-0369576
(IRS Employer Identification No.)
777 CALIFORNIA AVENUE
PALO ALTO, CA 94304
(650) 494-3700
(Address, Including Zip Code, and Telephone Number, Including
Area Code, of Registrant's Principal Executive Offices)
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Item 5. OTHER EVENTS.
Essex Property Trust, Inc. (the "Company"), Essex Portfolio, L.P. and
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Donaldson, Lufkin & Jenrette
Securities Corporation and Raymond James & Associates, Inc. have entered into a
Purchase Agreement and a Pricing Agreement, each dated December 2, 1997,
relating to the public offering of 1,500,000 shares of Common Stock of the
Company and up to an additional 225,000 shares of Common Stock subject to an
over-allotment option. The Purchase Agreement and the Pricing Agreement are
attached hereto as exhibits.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
The exhibits listed in the accompanying Index to Exhibits are filed as
part of this Current Report on Form 8-K.
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ESSEX PROPERTY, INC.
December 5, 1997 By: /s/ Mark J. Mikl
------------------------------
Mark J. Mikl
Controller (Authorized Officer
and Principal Accounting Officer)
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EXHIBIT INDEX
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EXHIBIT DESCRIPTION
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1.1 Purchase Agreement dated December 2, 1997 by and among Essex
Property Trust, Inc., Essex Portfolio, L.P. and Merrill Lynch,
Pierce, Fenner & Smith Incorporated, Donaldson, Lufkin & Jenrette
Securities Corporation, and Raymond James & Associates, Inc.
1.2 Pricing Agreement dated December 2, 1997 by and among Essex
Property Trust, Inc., Essex Portfolio, L.P. and Merrill Lynch,
Pierce, Fenner & Smith Incorporated, Donaldson, Lufkin & Jenrette
Securities Corporation, and Raymond James & Associates, Inc.
</TABLE>
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EXHIBIT 1.1
ESSEX PROPERTY TRUST, INC.
(a Maryland corporation)
Common Stock
PURCHASE AGREEMENT
December 2, 1997
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Donaldson, Lufkin & Jenrette
Securities Corporation
Raymond James & Associates, Inc.
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281
Ladies and Gentlemen:
Essex Property Trust, Inc., a Maryland corporation (the
"Company"), hereby confirms its agreement with Merrill Lynch & Co., Merrill
Lynch, Pierce, Fenner & Smith Incorporated ("Merrill Lynch"), Donaldson, Lufkin
& Jenrette Securities Corporation and Raymond James & Associates, Inc. (the
"Underwriters," which term shall also include any underwriter substituted as
hereinafter provided in Section 10 hereof), with respect to the sale by the
Company and the purchase by the Underwriters, acting severally and not jointly,
of the respective numbers of shares of common stock of the Company, par value
$0.0001 per share (the "Common Stock"), set forth in Schedule A hereto
aggregating 1,500,000 shares of Common Stock, and with respect to the grant by
the Company to the Underwriters, acting severally and not jointly, of the option
described in Section 2(b) hereof to purchase all or any part of 225,000
additional shares of Common Stock to cover over-allotments, in each case except
as may otherwise be provided in the Pricing Agreement, as hereinafter defined.
The aforesaid 1,500,000 shares of Common Stock (the "Initial Securities") to be
purchased by the Underwriters and all or any part of the 225,000 shares of
Common Stock subject to the option
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described in Section 2(b) hereof (the "Option Securities") are collectively
hereinafter called the "Securities."
Prior to the purchase and public offering of the Securities by
the Underwriters, the Company and the Underwriters shall enter into an agreement
substantially in the form of Exhibit A hereto (the "Pricing Agreement"). The
Pricing Agreement may take the form of an exchange of any standard form of
written telecommunication between the Company and the Underwriters, and shall
specify such applicable information as is indicated in Exhibit A hereto. The
offering of the Securities will be governed by this Agreement, as supplemented
by the Pricing Agreement. From and after the date of the execution and delivery
of the Pricing Agreement, this Agreement shall be deemed to incorporate the
Pricing Agreement.
The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (No. 333-21989) for the
registration of certain securities under the Securities Act of 1933, as amended
(the "1933 Act"), and the offering thereof from time to time in accordance with
Rule 415 of the rules and regulations of the Commission under the 1933 Act (the
"1933 Act Regulations"). The Company will file such additional amendments
thereto and such amended or supplemental prospectuses as may hereafter be
required prior to the execution of the Pricing Agreement. Such registration
statement, as so amended, has been declared effective by the Commission. Such
registration statement (as amended, if applicable) including the information, if
any, deemed to be part thereof pursuant to Rule 430A(b) of the 1933 Act
Regulations or Rule 434(d) of the 1933 Act Regulations, is referred to herein as
the "Registration Statement"; and the final prospectus and the prospectus
supplement relating to the offering of the Securities, in the form first
furnished to the Underwriters by the Company for use in connection with the
offering of the Securities, are collectively referred to herein as the
"Prospectus"; provided, however, that all references to the "Registration
Statement" and the "Prospectus" shall be deemed to include all documents
incorporated therein by reference pursuant to the Securities Exchange Act of
1934, as amended (the "1934 Act"), prior to the execution of the Pricing
Agreement; and provided, further, that if the Company elects to rely on Rule 434
of the 1933 Act Regulations, all references to the "Prospectus" shall be deemed
to include the final prospectus or preliminary prospectus, as the case may be,
and the term sheet or abbreviated term sheet (the "term sheet"), as the case may
be, in the form first furnished to the Underwriters by the Company in reliance
on Rule 434 of the 1933 Act Regulations, and all references in this Purchase
Agreement to the date of the Prospectus shall mean the date of the term sheet.
For purposes of this Agreement, all references to the Registration Statement,
the Prospectus or any Term Sheet or any amendment or supplement to any of the
foregoing shall be deemed to include the copy filed with the Commission pursuant
to its Electronic Data Gathering, Analysis and Retrieval system.
All references in this Agreement to the financial statements and
schedules and other information that is "contained," "included" or "stated" in
the Registration Statement or the Prospectus (or other references of like
import) shall be deemed to mean and include all such financial statements and
schedules and other information which is or is deemed to be
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incorporated by reference in the Registration Statement or the Prospectus, as
the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement or the Prospectus shall be deemed to
include the filing of any document under the 1934 Act which is or is deemed to
be incorporated by reference in the Registration Statement or the Prospectus, as
the case may be.
The terms "subsidiary" and "subsidiaries," as used herein, shall
mean Essex Portfolio, L.P., a California limited partnership (the "Operating
Partnership") and any other corporation, partnership or entity of which the
Company has the right or power, directly or indirectly, to elect a majority of
the board of directors in the case of a corporation or as to which the Company,
directly or indirectly, has a majority economic ownership interest in, in the
case of a partnership or entity.
The Company understands that the Underwriters propose to make a
public offering of the Securities as soon as they deem advisable after the
Pricing Agreement has been executed and delivered.
SECTION 1 Representations and Warranties.
(a) Each of the Company and the Operating Partnership
represents and warrants, jointly and severally, to each Underwriter as of the
date hereof, as of the date of the Pricing Agreement, as of the Closing Time (as
defined below) and, if applicable, as of each Date of Delivery (as defined
below) (in each case, a "Representation Date") as follows:
(i) Compliance with Registration Requirements. The
Company meets the requirements for use of Form S-3 under the 1933 Act.
The Registration Statement has become effective under the 1933 Act and
no stop order suspending the effectiveness of the Registration Statement
has been issued under the 1933 Act and no proceedings for that purpose
have been instituted or are pending or, to the knowledge of the Company,
are contemplated by the Commission, and any request on the part of the
Commission for additional information has been complied with.
At the time the Registration Statement became
effective and at each Representation Date, the Registration Statement
complied and will comply in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations and did not and will not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading. The Prospectus, at each
Representation Date, did not and will not include an untrue statement of
a material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading. If Rule 434 is used in connection
with the offering of the Securities, the Company will comply with the
requirements of Rule 434. The
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representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by the Underwriters expressly for
use in the Registration Statement or the Prospectus.
(ii) Incorporated Documents. The documents
incorporated or deemed to be incorporated by reference in the
Registration Statement and the Prospectus, at the time they were or
hereafter are filed with the Commission (the "Incorporated Documents"),
complied and will comply in all material respects with the requirements
of the 1934 Act and the rules and regulations of the Commission under
the 1934 Act (the "1934 Act Regulations"), and, when read together with
the other information in the Prospectus, at the date of the Prospectus
and at each Representation Date, will not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(iii) Independent Accountants. The accountants who
certified the financial statements and supporting schedules included in
the Registration Statement are independent public accountants as
required by the 1933 Act and the 1933 Act Regulations.
(iv) Financial Statements. The financial statements
included in the Registration Statement and the Prospectus present fairly
the financial position of the respective entity or entities at the dates
indicated and the results of their operations for the periods specified;
except as otherwise stated in the Registration Statement, said financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis; the supporting
schedules included in the Registration Statement present fairly the
information required to be stated therein; and the pro forma financial
statements included in the Registration Statement and the Prospectus
comply in all material respects with the applicable requirements of Rule
11-02 of Regulation S-X of the Commission and the pro forma adjustments
have been properly applied to the historical amounts in the compilation
of such statements and the assumptions used in the preparation thereof
are, in the opinion of the Company, reasonable.
(v) No Material Adverse Change in Business. Since
the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as otherwise stated or
contemplated therein, (A) there has been no material adverse change in
the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise or of the Company's
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properties taken as a whole, whether or not arising in the ordinary
course of business, (B) there have been no transactions entered into by
the Company or any of its subsidiaries, other than those in the ordinary
course of business, which are material with respect to the Company and
its subsidiaries considered as one enterprise, and (C) there has been no
dividend or distribution of any kind declared, paid or made by the
Company on any class of its stock.
(vi) Good Standing of the Company. The Company has
been duly organized and is validly existing as a corporation under, and
is in good standing under, the laws of the State of Maryland with
corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Prospectus and to enter
into and perform its obligations under this Agreement and the Pricing
Agreement; and the Company is duly qualified to transact business and is
in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or
the conduct of business.
(vii) Good Standing of Subsidiaries. Each
subsidiary of the Company has been duly formed and is validly existing
and in good standing under the laws of the jurisdiction of its origin,
has the power and authority to own, lease and operate its properties and
to conduct its business as described in the Prospectus and is duly
qualified to transact business and will be in good standing in each
jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business;
except as otherwise stated in the Prospectus, all of the issued and
outstanding capital stock or other ownership interests in each such
subsidiary have been duly authorized, validly issued, are fully paid and
non-assessable and are owned by the entities described in the
Prospectus, in each case free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(viii) Capitalization. The authorized and issued
and outstanding shares of all of the classes of the Company's capital
stock are as set forth in the Prospectus; the issued and outstanding
shares of all the classes of the Company's capital stock have been duly
authorized and validly issued and are fully paid and non-assessable; the
Securities have been duly authorized for issuance and sale to the
Underwriters pursuant to this Agreement and, when issued and delivered
by the Company pursuant to this Agreement against payment of the
consideration set forth in the Pricing Agreement, will be validly
issued, fully paid and non-assessable; the Company has duly reserved a
sufficient number of shares of Common Stock for issuance upon exchange
of outstanding Operating Partnership interests and the conversion of the
Company's 8.75% Convertible Preferred Stock, Series 1996A (the
"Convertible Preferred Stock"); the shares of Common Stock conform to
all statements relating thereto con-
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tained in the Prospectus; and, except for the preemptive rights of
Tiger/Westbrook Real Estate Fund, L.P. and Tiger/Westbrook Real Estate
Co-Investment Partnership, L.P. (collectively, "Tiger/Westbrook") as
described in the Prospectus, the issuance of the Securities is not
subject to preemptive or other similar rights.
(ix) Absence of Defaults and Conflicts. Neither the
Company nor any of its subsidiaries is in violation of its
organizational documents, including, as applicable, its charter, bylaws,
partnership, trust and joint venture agreements; neither the Company nor
any of its subsidiaries is or will be, upon application of the proceeds
of the offering described in the Prospectus, in default in the
performance or observance of any material duty (including any material
obligation, agreement, covenant or condition) contained in any contract,
indenture, mortgage, loan agreement, note, lease or other instrument to
which it or any of them is a party or by which it or any of them may be
bound, or to which any of their properties or assets is subject which
default would have a material adverse effect on the condition, financial
or otherwise, or the earnings, business affairs or business prospects of
the Company and its subsidiaries considered as one enterprise, or would,
either immediately or with the passage of time, allow any material
indebtedness of the Company to be accelerated; and the execution,
delivery and performance of this Agreement and the Pricing Agreement,
and the consummation of the transactions contemplated herein and therein
and compliance by the Company with its obligations hereunder and
thereunder have been duly authorized by all necessary action and will
not conflict with or constitute a breach of, or default under, or result
in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its subsidiaries
pursuant to, any contract, indenture, mortgage, loan agreement, note,
lease or other instrument to which the Company or any of its
subsidiaries is a party or by which it or any of them may be bound,
which default would have a material adverse effect on the condition,
financial or otherwise, or the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise, or would, either immediately or with the passage of time,
allow any material indebtedness of the Company to be accelerated, nor
will such action result in any violation of the provisions of the
charter or bylaws of the Company or any applicable law, administrative
regulation or administrative or court decree.
(x) Due Authorization; Binding Agreement. This
Agreement and the Pricing Agreement have been duly authorized, executed
and delivered by the Company and the Operating Partnership, as
applicable, and constitute a binding agreement of the Company and the
Operating Partnership, enforceable against the Company and the Operating
Partnership in accordance with its terms, except as such enforceability
may be limited by bankruptcy, in-
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solvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors' rights
generally and the effect of general principles of equity.
(xi) Absence of Labor Disputes. No labor dispute
with the employees of the Company or any subsidiary exists or, to the
knowledge of the Company, is imminent, which may reasonably be expected
to result in a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business prospects of
the Company and its subsidiaries, considered as one enterprise.
(xii) Absence of Proceedings. There is no action,
suit or proceeding before or by any court or governmental agency or
body, domestic or foreign, now pending, or, to the knowledge of the
Company, threatened, against or affecting the Company, any of its
subsidiaries or any of their respective properties, which is required to
be disclosed in the Prospectus (other than as disclosed therein), or
which might result in any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise, or which might materially and adversely affect the
properties or assets thereof or the consummation of the transactions
contemplated by this Agreement; all pending legal or governmental
proceedings to which the Company or any of its subsidiaries is a party
or of which any of their respective properties or assets is the subject
which are not described in the Prospectus, including ordinary routine
litigation incidental to the business, are, considered in the aggregate,
not material; and there are no contracts or documents of the Company or
any of its subsidiaries required to be filed as exhibits to the
Registration Statement by the 1933 Act or the 1933 Act Regulations which
have not been so filed.
(xiii) REIT Status. The Company has been organized
and operated in conformity with the requirements for qualification as a
real estate investment trust (a "REIT") under the Internal Revenue Code
of 1986, as amended (the "Code"), for each of its taxable years
beginning with the taxable year ended December 31, 1994, and the
Company's present and proposed method of operation will enable it to
continue to meet the requirements for qualification as a REIT under the
Code.
(xiv) NYSE Listing. The shares of Common Stock,
including the Securities, have been approved for listing on the New York
Stock Exchange.
(xv) Absence of Further Requirements. No
authorization, approval, consent or waiver of, or filing, registration
or qualification
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with, or notice to any court or governmental authority or agency or any
other person on the part of the Company is required to be made, obtained
or given in connection with the execution, delivery and performance of
this Agreement and the Pricing Agreement and the offering, issuance or
sale of the Securities hereunder, except (i) to the extent such will be
made, obtained or given prior to the Closing Time and (ii) such as may
be required under the 1933 Act or the 1933 Act Regulations, state
securities laws or the National Association of Securities Dealers, Inc.
(xvi) Possession of Licenses and Permits. The
Company and its subsidiaries have complied with all laws applicable to
the conduct of their respective businesses and the ownership, use and
operation of their respective properties except as would not have a
material adverse effect on the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise. The Company and its
subsidiaries, directly or indirectly, possess such certificates,
authorities or permits issued by the appropriate state, federal or
foreign regulatory agencies or bodies necessary to conduct the business
now operated by them and proposed to be conducted by them as described
in the Prospectus, and neither the Company nor any of its subsidiaries
has received any notice of proceedings relating to the revocation or
modification of any such certificate, authority or permit which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling
or finding, would materially and adversely affect the condition,
financial or otherwise, or the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise.
(xvii) Absence of Registration Rights. Except as
described in the Prospectus, there are no persons with registration or
other similar rights to have any securities registered pursuant to the
Registration Statement or otherwise registered by the Company under the
1933 Act.
(xviii) Properties. (A) Except as described in the
Prospectus, the Company or its subsidiaries has good and marketable
title in fee simple to all real property and interests in real property
owned by each of them, including, but not limited to, the properties
described in or incorporated by reference into the Prospectus
(collectively, for purposes of this Section 1(a)(xviii), the
"Properties"); in each case, such title is free and clear of all liens,
encumbrances, claims, security interests and defects of any kind
(including, without limitation, options to purchase and rights of first
refusal), other than those referred to in the Prospectus or which would
not have a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business prospects of
the Company and its subsidiaries, considered as
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one enterprise; (B) all liens, charges, encumbrances, claims, or
restrictions on or affecting the Properties which are required to be
disclosed in the Prospectus are disclosed therein; (C) neither the
Company (nor any of its subsidiaries) nor, to the best of the knowledge
of the Company (or any of its subsidiaries), any lessee under a lease
relating to any of the Properties is in default under any of the leases
relating thereto, and the Company (or any of its subsidiaries) does not
know of any event which, but for the passage of time or the giving of
notice, or both, would constitute a default under any of such leases,
except such defaults that would not have a material adverse effect on
the condition, financial or otherwise, or the earnings, business affairs
or business prospects of the Company and its subsidiaries, considered as
one enterprise; (D) each of the Properties is in compliance with all
applicable codes, ordinances, zoning laws and regulations, and neither
the Company nor any of its subsidiaries has received a notice of
violation of any of the foregoing, except for such failures to comply or
violations which would not have a material adverse effect on the
condition, financial or otherwise, or the earnings, business affairs or
business prospects of the Company and its subsidiaries, considered as
one enterprise; (E) neither the Company nor any of its subsidiaries has
any knowledge of any pending or threatened condemnation or zoning change
with respect to all or any portion of any of the Properties, or of any
other proceeding or action that will affect the size of, use of,
improvements on, construction on, or access to all or any portion of any
of the Properties, except such proceedings or actions that would not
have a material adverse effect on the condition, financial or otherwise,
or the earnings, business affairs or business prospects of the Company
and its subsidiaries, considered as one enterprise; (F) the maintenance,
service, advertising and other like contracts and agreements with
respect to the ownership and operation of Properties other than any
property management agreement (the "Service Contracts") are in full
force and effect and have been entered into with third parties that are
not affiliated with the Company or any of its subsidiaries in the
ordinary course of business of the Company and its subsidiaries, as
applicable, and are incidental and reasonably related to the ownership
and/or operation of their respective Properties and neither the Company
nor its subsidiaries is in default under any of the Service Contracts
except for such defaults that would not have a material adverse effect
on the condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company and its subsidiaries,
considered as one enterprise; (G) all of the leases and subleases
material to the business of the Company and its subsidiaries, considered
as one enterprise, and under which the Company or any of its
subsidiaries holds Properties are in full force and effect, and neither
the Company nor any of its subsidiaries has any notice of any material
claim of any sort that has been asserted by anyone adverse to the rights
of the Company or any subsidiary under any of the leases or subleases
mentioned above, or affecting or questioning the rights of the Company
or such subsidiary to the continued possession of
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the leased or subleased premises under any such lease or sublease; and
(H) there exist no liens, encumbrances, claims, security interests and
defects of any kind on the Company's or any subsidiary's ability to
collect rents from its Properties, except for such liens, encumbrances,
claims, security interests and defects that would not have a material
adverse effect on the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise, and the Company's collection
of such rents is in accordance with all applicable laws, rules and
regulations and neither the Company nor any of its subsidiaries has
received a notice of violation of any of the foregoing, except for such
violations that would not have a material adverse effect on the
condition, financial or otherwise, or the earnings, business affairs or
business prospects of the Company and its subsidiaries, considered as
one enterprise.
(xix) Title Insurance. Each of the Operating
Partnership and its subsidiaries has title insurance on all of its
properties and assets in an amount at least equal to the purchase price
of such property, subject only to liens, encumbrances, claims, security
interests and defects that customarily encumber comparable properties;
such title insurance is in full force and effect; and no notice of
cancellation has been received with respect thereto and, to the
knowledge of the Company, none is threatened.
(xx) Mortgages. The mortgages and deeds of trust
encumbering the properties and assets described in the Prospectus are
not convertible into an equity ownership interest in the Company or any
of its subsidiaries (except for mortgages existing on the date hereof
encumbering the properties commonly known as the Shores and Bristol
Commons) and neither the Company nor any of its subsidiaries holds a
participating interest therein and such mortgages and deeds of trust are
not cross-defaulted or cross-collateralized to any property not owned or
leased by the Company or any of its subsidiaries.
(xxi) Stabilization. The Company has not taken and
will not take, directly or indirectly, any action designed to, or that
might be reasonably expected to, cause or result in stabilization or
manipulation of the price of the Common Stock.
(xxii) Investment Company Act. Neither the Company
nor any of its subsidiaries is subject to registration as an "investment
company" under the Investment Company Act of 1940.
(xxiii) Environmental Matters. Except as described
in the Prospectus and except such violations as would not, singly or in
the aggregate, result in a material adverse effect on the condition,
financial or otherwise,
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or the earnings, business affairs or business prospects of the Company
and its subsidiaries, considered as one enterprise or otherwise would
require disclosure in the Prospectus, (A) neither the Company nor any of
its subsidiaries is in violation of any federal, state, local or foreign
statute, law, rule, regulation, ordinance, code, policy or rule of
common law and any judicial or administrative interpretation thereof
including any judicial or administrative order, consent, decree or
judgment, relating to pollution or protection of human health, the
environment (including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife, including,
without limitation, laws and regulations relating to the release or
threatened release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling
of Hazardous Materials (collectively, "Environmental Laws"), (B) the
Company and its subsidiaries have all permits, authorizations and
approvals required under any applicable Environmental Laws and are each
in compliance with their requirements, (C) there are no pending or
threatened administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, notices of noncompliance or
violation, investigation or proceedings relating to any Environmental
Law against the Company or any of its subsidiaries and (D) there are no
events or circumstances that might reasonably be expected to form the
basis of an order for clean-up or remediation, or an action, suit or
proceeding by any private party or governmental body or agency, against
or affecting the Company or any of its subsidiaries relating to any
Hazardous Materials or the violation of any Environmental Laws.
(xxiv) Taxes. (i) The Company has filed when due
all Federal, state and local returns for "Taxes" (as hereinafter
defined) that are required to be filed by it for all taxable periods
through and including December 31, 1996; all such returns were prepared
in the manner required by applicable law and were true, correct and
complete in all material respects; and the Company has paid all Taxes
reported as due in such returns, and has paid any other taxes for which
it may be liable; (ii) the Company is not in material default in respect
of the payment of Taxes levied or assessed against it or any of its
assets for all taxable periods through the date hereof, and there are no
material liens or claims for Taxes outstanding upon or against or
threatened upon or against it or any of its assets (other than liens for
Taxes which are not yet due and payable); and (iii) no audit, inquiry,
investigation or similar proceeding with respect to Taxes of which the
Company is aware to the best of its knowledge is currently pending or
threatened against the Company or any of its assets, an adverse outcome
of which could have a material adverse effect on the
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condition, financial or otherwise, or the earnings, business affairs or
business prospects of the Company.
As used in the above paragraph, the term "Tax" or
"Taxes" shall include all United States federal, state, local and
foreign taxes, assessments or other governmental charges (whether
imposed directly or through withholding), including any interest,
penalties and additions to taxes applicable thereto.
(xxv) Amount of Securities Sold. Immediately after
any sale of Securities by the Company hereunder, the aggregate amount of
Securities that have been issued and sold by the Company hereunder and
of any securities of the Company (other than the Securities) that shall
have been issued and sold pursuant to the Registration Statement will
not exceed the amount of securities registered under the Registration
Statement.
(b) Any certificate signed by any officer of the Company
in his or her capacity as an officer of the Company and delivered to the
Underwriters or to counsel for the Underwriters shall be deemed a representation
and warranty by the Company to each Underwriter as to the matters covered
thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Company, at
the price per share set forth in the Pricing Agreement, the number of Initial
Securities set forth in Schedule A opposite the name of such Underwriter (except
as otherwise provided in the Pricing Agreement), plus any additional number of
Initial Securities which such Underwriter may become obligated to purchase
pursuant to the provisions of Section 10 hereof.
(b) In addition, on the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company hereby grants an option to the Underwriters, severally and
not jointly, to purchase up to all of the Option Securities at the purchase
price per share set forth in the Pricing Agreement, less an amount per share
equal to any dividends declared by the Company and payable on the Initial
Securities but not payable on the Option Securities. The option hereby granted
will expire 30 calendar days after the date of the Pricing Agreement and may be
exercised in whole or in part from time to time only for the purpose of covering
over-allotments which may be made in connection with the offering and
distribution of the Initial Securities upon notice by Merrill Lynch to the
Company setting forth the number of Option Securities as to which the
Underwriters are then exercising the option and the time and date of payment and
delivery for such Option Securities. Any such time and date of delivery (a "Date
of Delivery") shall be determined by
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<PAGE> 13
the Underwriters, but shall not be later than seven full business days after the
exercise of said option, nor in any event prior to Closing Time, unless
otherwise agreed by the Underwriters and the Company. If the option is exercised
as to all or any portion of the Option Securities, each of the Underwriters,
acting severally and not jointly, will purchase that proportion of the total
number of Option Securities then being purchased which the number of Initial
Securities set forth in Schedule A opposite the name of such Underwriter bears
to the total number of Initial Securities (except as otherwise provided in the
Pricing Agreement), subject in each case to such adjustments as the Underwriters
in their discretion shall make to eliminate any sales or purchases of fractional
shares.
(c) Payment of the purchase price and delivery of
certificates for the Initial Securities shall be made at the offices of Morrison
& Foerster LLP, 755 Page Mill Road, Palo Alto, CA 94304-1018, or at such other
place as shall be agreed upon by the Underwriters and the Company, at 10:00 A.M.
New York time on the third business day after execution of the Pricing
Agreement, or such other time not later than ten business days after such date
as shall be agreed upon by the Underwriters and the Company (such time and date
of payment and delivery being herein called "Closing Time"). In addition, in the
event that any or all of the Option Securities are purchased by the
Underwriters, payment of the purchase price and delivery of certificates for
such Option Securities shall be made at the above mentioned offices, or at such
other place as shall be agreed upon by the Underwriters and the Company, on each
Date of Delivery as specified in the notice from Merrill Lynch to the Company.
Payment shall be made to the Company by wire transfer payable in same day funds,
to the order of the Company. Payment shall be against delivery to the
Underwriters for the respective accounts of the Underwriters of certificates for
the Securities to be purchased by them. Certificates for the Initial Securities
and the Option Securities, if any, shall be in such denominations and registered
in such names as the Underwriters may request in writing at least one full
business day before the Closing Time or the relevant Date of Delivery, as the
case may be. Merrill Lynch, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Initial Securities or the Option Securities, if any, to be
purchased by any Underwriter whose payment has not been received by Closing Time
or the relevant Date of Delivery, as the case may be, but such payment shall not
relieve such Underwriter from its obligations hereunder. The certificates for
the Initial Securities and the Option Securities, if any, will be made available
for examination and packaging by the Underwriters not later than 10:00 A.M. on
the last business day prior to Closing Time or the relevant Date of Delivery, as
the case may be.
SECTION 3. Covenants. The Company covenants with each Underwriter
as follows:
(a) The Company will notify the Underwriters immediately,
and confirm the notice in writing, (i) of the effectiveness of any
post-effective amendment to the Registration Statement filed after the date of
this Agreement in connection with the offering of the Securities, (ii) of the
receipt of any comments from the Commission, (iii) of any request by the
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<PAGE> 14
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or any order by any state securities administrator
suspending the qualification of the Securities in such state or the initiation
of any proceedings for that purpose. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any stop order or
suspension is issued, to obtain the lifting thereof at the earliest possible
moment.
(b) The Company will give the Underwriters notice of its
intention to file or prepare any post-effective amendment to the Registration
Statement filed after the date of this Agreement in connection with the offering
of the Securities or any amendment or supplement to the Prospectus (including
any revised prospectus which the Company proposes for use by the Underwriters in
connection with the offering of the Securities or any term sheet, whether or not
such revised prospectus or term sheet is required to be filed pursuant to Rule
424(b) or Rule 434 of the 1933 Act Regulations), will furnish the Underwriters
with copies of any such amendment or supplement or term sheet a reasonable
amount of time prior to such proposed filing or use, as the case may be, and
will not file any such amendment or supplement or term sheet or use any such
prospectus to which the Underwriters or counsel for the Underwriters shall
object.
(c) The Company will deliver to each Underwriter one
signed copy of any post-effective amendment to the Registration Statement made
in connection with the offering of the Securities (including exhibits filed
therewith or incorporated by reference therein and documents incorporated or
deemed to be incorporated by reference therein) and will also deliver to the
Underwriters a conformed copy of the Registration Statement as originally filed
and of each amendment, post-effective amendment or supplement or term sheet
thereto (without exhibits) for each of the Underwriters.
(d) The Company will furnish to each Underwriter, from
time to time during the period when the Prospectus is required to be delivered
under the 1933 Act or the 1934 Act, such number of copies of the Prospectus (as
amended or supplemented) and the term sheet, if any, as such Underwriter may
reasonably request for the purposes contemplated by the 1933 Act or the 1934 Act
or the respective applicable rules and regulations of the Commission thereunder.
(e) If any event shall occur as a result of which it is
necessary, in the reasonable opinion of counsel for the Underwriters, to amend
or supplement the Prospectus in order to make the Prospectus not misleading in
the light of the circumstances existing at the time it is delivered to a
purchaser, or if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the 1933 Act or the 1933 Act
Regulations, the Company will forthwith amend or supplement the Prospectus (in
form and substance reasonably satisfactory to counsel for the Underwriters) so
that, as so amended or supplemented, the Prospectus will not include an untrue
statement of a material fact or omit to state a
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<PAGE> 15
material fact necessary in order to make the statements therein, in the light of
the circumstances existing at the time it is delivered to a purchaser, not
misleading, and will comply with the 1933 Act and the 1933 Act Regulations, and
the Company will furnish to the Underwriters a reasonable number of copies of
such amendment or supplement.
(f) The Company will endeavor, in cooperation with the
Underwriters, to qualify the Securities for offering and sale under the
applicable securities laws and real estate syndication laws of such states and
other jurisdictions of the United States as the Underwriters may designate;
provided, however, that the Company shall not be obligated to (i) file any
general consent to service of process, (ii) qualify as a foreign corporation in
any jurisdiction in which it is not so qualified or (iii) take any action that
would subject it to income taxation in any such jurisdiction. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the date of the Pricing Agreement.
(g) The Company will make generally available to its
security holders as soon as practicable, but not later than fifty (50) days
after the close of the period covered thereby, an earnings statement (in form
complying with the provisions of Rule 158 of the 1933 Act Regulations) covering
a twelve-month period beginning not later than the first day of the Company's
fiscal quarter next following the "effective date" (as defined in said Rule 158)
of the Registration Statement.
(h) Immediately following the execution of the Pricing
Agreement, the Company will prepare, and file or transmit for filing with the
Commission in accordance with Rule 434 and Rule 424(b) of the 1933 Act
Regulations, copies of the amended Prospectus supplement and term sheet, if any,
to the Registration Statement, containing all information so omitted.
(i) The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus under
"Use of Proceeds."
(j) During a period of 90 days from the date of the
Pricing Agreement, the Company and the Operating Partnership will not, without
Merrill Lynch's prior written consent, directly or indirectly, sell, offer to
sell, grant any option for the sale of, or otherwise transfer or dispose of
(whether directly or synthetically), or enter into any agreement to sell or
otherwise dispose of (whether directly or synthetically) any Common Stock or any
security convertible into or exchangeable into or exercisable for Common Stock,
except for shares of Common Stock issued (i) pursuant to this Agreement, (ii)
pursuant to the Company's stock option plans as described in the Prospectus,
(iii) pursuant to the terms of the Convertible Preferred Stock, and (iv)
pursuant to the exchange of outstanding limited partnership interests in the
Operating Partnership in accordance with the terms of the Operating Partnership
as of the date hereof.
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<PAGE> 16
(k) The Company, consistent with the best interests of its
shareholders, will use its best efforts to continue to meet the requirements to
qualify as a REIT under the Code.
(l) The Company will file, prior to any Representation
Date, all documents required to be filed with the Commission pursuant to Section
13, 14 or 15 of the 1934 Act within the time periods required by the 1934 Act
and the 1934 Act Regulations.
(m) If the Company uses Rule 434 of the 1933 Act
Regulations in connection with the offering of the Securities, it will comply
with the requirements of Rule 434 of such regulations.
(n) The Company will comply with all the provisions of any
undertakings contained in the Registration Statement.
SECTION 4. Payment of Expenses. The Company shall pay all
expenses incident to the performance of its obligations under this Agreement,
including (i) the printing and filing of the Registration Statement and any
post-effective amendment thereto, (ii) the printing of this Agreement and the
Pricing Agreement, (iii) the preparation, issuance and delivery of the
certificates for the Securities to the Underwriters, including the payment of
any stock transfer taxes, stamp duties and similar taxes, if any, payable upon
the issuance of any Securities and the sale of the Securities to the
Underwriters and their transfer between the Underwriters pursuant to an
agreement between the Underwriters, (iv) the fees and disbursements of the
Company's counsel and accountants, (v) the qualification of the Securities under
securities and real estate syndication laws in accordance with the provisions of
Section 3(f) hereof, including filing fees and the fees and disbursements of
counsel in connection therewith and in connection with the preparation of any
Blue Sky Survey and any Legal Investment Survey, (vi) the printing and delivery
to the Underwriters of copies of the Registration Statement as originally filed
and of each amendment thereto, of each preliminary prospectus supplement, and of
the Prospectus and any amendments or supplements thereto, (vii) the printing and
delivery to the Underwriters of copies of any Blue Sky Survey and any Legal
Investment Survey, (viii) the fees of the National Association of Securities
Dealers, Inc., if any, and (ix) the fees and expenses incurred in connection
with the listing of the Securities on the New York Stock Exchange; provided,
however that the Company shall have no obligation to reimburse the Underwriters
for (i) fees, disbursements and out-of-pocket expenses of legal counsel to the
Underwriters if the offering, as contemplated hereby, closes, or (ii) expenses
in connection with the offering, as contemplated hereby, (other than legal fees
and disbursements as aforesaid) that are customarily borne by the
representatives in public offerings managed by Merrill Lynch.
If this Agreement is terminated by the Underwriters in accordance
with the provisions of Section 5 or Section 9(a)(i) hereof, the Company shall
reimburse the Underwrit-
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<PAGE> 17
ers for all of their reasonable out-of-pocket expenses, including the reasonable
fees and disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The
obligations of the Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Operating Partnership
herein contained, to the performance by each of the Company and the Operating
Partnership of its obligations hereunder, and to the following further
conditions:
(a) The Registration Statement, as amended, shall have
become effective on or prior to the date of this Agreement; and at Closing Time
no stop order suspending the effectiveness of the Registration Statement shall
have been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission. The price of the Securities and any price-related
information previously omitted from the effective Registration Statement and any
term sheet used pursuant to Rule 434 of the 1933 Act Regulations shall have been
transmitted to the Commission for filing pursuant to Rule 424(b) of the 1933 Act
Regulations within the prescribed time period and, prior to the Closing Time the
Company shall have provided evidence satisfactory to the Underwriters of such
timely filing, or a post-effective amendment providing such information shall
have been promptly filed and declared effective.
(b) At Closing Time the Underwriters shall have received:
(1) The favorable opinion, dated as of Closing Time, of
Morrison & Foerster LLP, counsel for the Company, in form and substance,
and subject to qualifications, exceptions and assumptions, satisfactory
to counsel for the Underwriters, to the effect that:
(i) The Company has been duly organized and is
validly existing as a corporation under the laws of the State of
Maryland and is in good standing under the laws of the State of
Maryland.
(ii) The Company is duly qualified as a foreign
corporation to transact business in and is in good standing under the
laws of each jurisdiction in which such qualification is required and
permitted or is subject to no material liability or disability by reason
of failure to be so qualified in any such jurisdiction.
(iii) Each of the Company, the Operating
Partnership, Essex Bristol Partners, L.P., Essex San Ramon Partners,
L.P., Essex Meadowood, L.P., Essex Camarillo, L.P., and Essex Huntington
Breakers, L.P. has been duly formed and is validly existing and in good
standing under the laws of the jurisdiction of its origin, has the power
and authority to own, lease and operate its properties and to conduct
its business as described in the
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<PAGE> 18
Prospectus and, to such counsel's knowledge and information, is duly
qualified as a foreign entity to transact business in and is in good
standing under the laws of each jurisdiction in which such qualification
is required or is subject to no material liability or disability by
reason of failure to be so qualified in any such jurisdiction; all of
the outstanding ownership interests of each subsidiary of the Company
have been duly authorized and validly issued, are fully paid, and the
Company's ownership interest in each subsidiary of the Company is owned
directly or through subsidiaries by the Company as described in the
Prospectus, free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity.
(iv) Each of the Company and the Operating
Partnership has the power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus
and, each of the Company and the Operating Partnership, as the case may
be, has the power and authority to enter into and perform its
obligations under this Agreement and the Pricing Agreement.
(v) The Securities have been duly authorized for
issuance and sale to the Underwriters pursuant to this Agreement and,
when issued and delivered by the Company pursuant to this Agreement
against payment of the consideration set forth in the Pricing Agreement,
will be validly issued, fully paid and non-assessable.
(vi) The Company has an authorized capitalization
as set forth in the Prospectus, and the issued and outstanding shares of
all classes of the Company's capital stock have been duly authorized and
validly issued and are fully paid and non-assessable.
(vii) The issuance of the Securities is not subject
to preemptive or other similar rights arising by operation of law, the
Company's charter or bylaws or, to such counsel's knowledge, otherwise,
other than the preemptive rights of Tiger/Westbrook, as described in the
Prospectus, which have been waived.
(viii) The Securities conform in all material
respects as to legal matters to the description thereof contained in the
Prospectus and the form of certificate used to evidence the Common Stock
is in due and proper form and complies with all applicable statutory
requirements.
(ix) This Agreement has been duly authorized,
executed and delivered by the Company and the Operating Partnership.
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(x) The Pricing Agreement has been duly authorized,
executed and delivered by the Company.
(xi) The Registration Statement is effective under
the 1933 Act, and, to the best of such counsel's knowledge, no stop
order suspending the effectiveness of the Registration Statement has
been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission.
(xii) At the time the Registration Statement became
effective and at each Representation Date, the Registration Statement
(other than the financial statements and supporting schedules and other
financial data included therein, as to which no opinion need be
rendered) complied as to form in all material respects with the
applicable requirements of the 1933 Act and the 1933 Act Regulations.
(xiii) To such counsel's knowledge, there are no
legal or governmental proceedings pending or threatened which are
required to be disclosed in the Prospectus, other than those disclosed
therein, and all pending legal or governmental proceedings to which the
Company or any of its subsidiaries is a party or to which any of their
properties is subject which are not described in the Prospectus,
including ordinary routine litigation incidental to the business, are,
considered in the aggregate, not material.
(xiv) The statements in the Prospectus under the
headings "Description of Common Stock," "Certain Provisions of the
Company's Charter and Bylaws," "Federal Income Tax Considerations,"
"Description of Preferred Stock - Right of Tiger/Westbrook to
Participate in Offerings," "Description of Capital Stock of the Company"
and "Risk Factors - Risks Associated with Convertible Preferred Stock
and Certain Other Risks," to the extent that they constitute matters of
law, summaries of legal matters, documents or proceedings, or legal
conclusions, have been reviewed by such counsel and are in all material
respects accurate summaries and fairly and correctly represent in all
material respects the information required with respect to such legal
matters, documents or proceedings.
(xv) To such counsel's knowledge, there are no
contracts, indentures, mortgages, loan agreements, notes, leases or
other instruments required to be described in the Prospectus or to be
filed as exhibits to the Registration Statement other than those
described therein or filed as exhibits thereto, and the descriptions
thereof or references thereto are correct in all material respects.
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<PAGE> 20
(xvi) No authorization, approval, consent or order
of any court or governmental authority or agency is required in
connection with the offering, issuance or sale of the Securities to the
Underwriters, except such as may be required under the 1933 Act or the
1933 Act Regulations or securities laws of any state; and the execution,
delivery and performance of this Agreement and the Pricing Agreement and
the consummation of the sale of the Securities contemplated herein and
therein and compliance by the Company with its obligations hereunder and
thereunder will not result in any violation of the provisions of the
Company's charter or bylaws or the organizational documents of any
subsidiary, or any applicable law, administrative regulation or
administrative or court decree, nor will any such action, to such
counsel's knowledge, conflict with, or constitute a breach of, or
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
subsidiary, as the case may be, pursuant to any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which the
Company or any subsidiary is a party or by which any of them may be
bound, or to which any of their properties or assets is subject.
(xvii) Except as disclosed in the Prospectus, there
are no persons with registration or other similar rights to have any
securities registered pursuant to the Registration Statement or
otherwise registered by the Company under the 1933 Act.
(xviii) Neither the Company nor any of its
subsidiaries is an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment Company
Act of 1940, as amended.
(xix) The Company has qualified as a REIT under the
Code as of the Closing Time and for each of its taxable years beginning
with the taxable year ended December 31, 1994, and is organized in
conformity with the requirements for qualification as a REIT under the
Code and its present and proposed method of operation will enable it to
meet the requirements for qualification as a REIT under the Code.
(xx) Each document filed pursuant to the 1934 Act
(other than financial statements and schedules included therein, as to
which no opinion need be rendered) and incorporated or deemed to be
incorporated by reference in the Prospectus complied when so filed as to
form in all material respects with the 1934 Act and the 1934 Act
Regulations.
In giving its opinions, Morrison & Foerster LLP may
rely as to matters of fact upon certificates of officers of the Company,
its subsidiaries and the Operating Partnership, and as to matters of
Maryland law on the opinion of Ballard
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<PAGE> 21
Spahr Andrews & Ingersoll, which opinion shall be in form and substance
satisfactory to counsel for the Underwriters.
In addition such counsel shall state that they have
participated in conferences with officers and other representatives of
the Company, the Underwriters, counsel for the Underwriters and the
Company's independent accountants, at which conferences the contents of
the Registration Statement and the Prospectus and related matters were
discussed and, although they are not passing upon, and do not assume any
responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement or Prospectus, and
they have not made any independent check or verification thereof, on the
basis of the foregoing, no facts have come to their attention that would
lead them to believe that the Registration Statement, as amended,
(except for financial statements and schedules and other financial or
statistical data included therein, as to which counsel need make no
statement), at the time it became effective, contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus (except for financial
statements and schedules and other financial or statistical data
included therein, as to which counsel need make no statement), at the
date of the Pricing Agreement and at the Closing Time, included any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances in which they were made, not
misleading.
(2) The favorable opinion, dated as of Closing Time, of
Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the Underwriters,
with respect to the matters set forth in paragraph (xi), of subsection
(b)(1) of this Section.
In addition such counsel shall state that they have
participated in conferences with officers and other representatives of
the Company, the Underwriters, counsel for the Company and the Company's
independent accountants, at which conferences the contents of the
Registration Statement and the Prospectus and related matters were
discussed and, although they are not passing upon, and do not assume any
responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus,
and they have not made any independent check or verification thereof, on
the basis of the foregoing, no facts have come to their attention that
would lead them to believe that the Registration Statement, at the date
of the Pricing Agreement and at the Closing Time, contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus, at the time it is first
provided to the Underwriters for such use or at the Closing Time,
included or includes an untrue statement of a material fact or omitted
or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, except that in each case counsel need
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express no opinion or belief with respect to the Incorporated Documents
or the financial statements, schedules and other financial or
statistical data included or incorporated by reference therein or
excluded therefrom or the exhibits to the Registration Statement.
(c) At Closing Time, there shall not have been, since the
date hereof or since the respective dates as of which information is given in
the Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company (or the Operating Partnership, as the case may be) and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of
business, and the Underwriters shall have received a certificate of the Chief
Executive Officer and of the Chief Financial Officer of the Company (or, in the
case of the Operating Partnership, the Company as the general partner of the
Operating Partnership, as the case may be), dated as of Closing Time, to the
effect that (i) there has been no such material adverse change, (ii) the
representations and warranties in Section 1 hereof are true and correct with the
same force and effect as though expressly made at and as of Closing Time, (iii)
the Company (or the Operating Partnership, as the case may be) has complied with
all agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to Closing Time, and (iv) with respect to the certificate
delivered by the Company only, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been initiated or threatened by the Commission. As used in this Section 5(c),
the term "Prospectus" means the Prospectus in the form first used to confirm
sales of the Securities.
(d) At the time of the execution of this Agreement, the
Underwriters shall have received from KPMG Peat Marwick LLP a letter dated such
date, in form and substance satisfactory to the Underwriters and the officers
and directors of the Company, to the effect that (i) they are independent public
accountants with respect to the Company and its subsidiaries within the meaning
of the 1933 Act and the 1933 Act Regulations; (ii) it is their opinion that the
financial statements and supporting schedules included in the Registration
Statement and covered by their opinions therein comply as to form in all
material respects with the applicable accounting requirements of the 1933 Act
and the 1933 Act Regulations; (iii) based upon limited procedures set forth in
detail in such letter, and except as otherwise set forth in such letter, nothing
has come to their attention which causes them to believe that (A) at a specified
date not more than five days prior to the date of this Agreement, there has been
any change in capital stock or long-term debt of the Company or any decrease in
consolidated net assets or stockholders' equity of the Company as compared with
the amounts shown in the September 30, 1997 unaudited condensed consolidated
balance sheet of the Company incorporated by reference in the Registration
Statement or, during the period from October 1, 1997 to a specified date not
more than five days prior to the date of this Agreement, there were any
decreases, as compared with the corresponding period in the preceding year, in
consolidated revenues or net income of the Company, except in all instances for
changes, increases or decreases which the Registration Statement and the
Prospectus disclose have occurred or may occur or (B) the unaudited combined pro
forma financial statements included in
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<PAGE> 23
the Registration Statement do not comply as to form in all material respects
with the applicable accounting requirements of Rule 11-02 of Regulation S-X of
the Commission or that the pro forma adjustments have not been properly applied
to the historical amounts in the compilation of such statements; and (iv) in
addition to the examination referred to in their opinion and the limited
procedures referred to in clause (iii) above, they have carried out certain
specified procedures, not constituting an audit, with respect to certain
amounts, percentages and financial information included in the Registration
Statement and Prospectus that are specified by the Underwriters, and have found
such amounts, percentages and financial information to be in agreement with the
relevant accounting, financial and other records of the Company, or Essex
Partners Properties, as the case may be, identified in such letter.
(e) At Closing Time, the Underwriters and the officers and
directors of the Company shall have received from KPMG Peat Marwick LLP, dated
as of Closing Time, to the effect that they reaffirm the statements made in the
letter furnished pursuant to subsection (d) of this Section, except that the
specified date referred to shall be a date not more than five days prior to
Closing Time and, to the further effect that they have carried out procedures as
specified in clause (iv) of subsection (d) of this Section with respect to
certain amounts, percentages and financial information specified by the
Underwriters and have found such amounts, percentages and financial information
to be in agreement with the records specified in such clause (iv).
(f) At Closing Time the Securities shall be listed on the
New York Stock Exchange.
(g) At Closing Time and at each Date of Delivery, if any,
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may reasonably require for the purpose of enabling them to pass
upon the issuance and sale of the Securities as herein contemplated and related
proceedings, or in order to evidence the accuracy of any of the representations
or warranties, or the fulfillment of any of the conditions, herein contained;
and all proceedings taken by the Company in connection with the issuance and
sale of the Securities as herein contemplated shall be reasonably satisfactory
in form and substance to the Underwriters and counsel for the Underwriters.
(h) At Closing Time, any and all waivers and consents
necessary to consummate the offering of the Securities and the transactions
contemplated by this Purchase Agreement shall have been received.
(i) At Closing Time, the Company and any buyers of the
Securities shall have complied with Article EIGHTH(a)(9) of the Company's
charter.
(j) In the event that the Underwriters exercise the option
provided in Section 2(b) hereof to purchase all or any portion of the Option
Securities, the representations and warranties contained herein and the
statements in any certificates furnished by the Compa-
23
<PAGE> 24
ny hereunder shall be true and correct as of each Date of Delivery and, at the
relevant Date of Delivery, the Underwriters shall have received:
(i) A certificate, dated such Date of Delivery, of
the Chief Executive Officer of the Company and of the Chief Financial
Officer of the Company confirming that the certificate delivered at
Closing Time pursuant to Section 5(c) hereof remains true and correct as
of such Date of Delivery.
(ii) The favorable opinion of Morrison & Foerster
LLP, counsel for the Company, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery, relating to
the Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by Section 5(b)(1)
hereof.
(iii) The favorable opinion of Skadden, Arps,
Slate, Meagher & Flom LLP, counsel for the Underwriters, dated such Date
of Delivery, to the same effect as the opinion required by Section
5(b)(2) hereof.
(iv) A letter from KPMG Peat Marwick LLP, in form
and substance satisfactory to the Underwriters and the officers and
directors of the Company, dated such Date of Delivery, substantially the
same in form and substance as the letter furnished by such firm to the
Underwriters pursuant to Section 5(e) hereof, except that the "specified
date" in the letter furnished pursuant to this Section 5(i)(4) shall be
a date not more than five days prior to such Date of Delivery.
If any condition specified in this Section shall not have been fulfilled when
and as required to be fulfilled, this Agreement, or, in the case of any
condition to the purchase of Option Securities on a Date of Delivery which is
after the Closing Time, the obligations of the Underwriters to purchase the
relevant Option Securities, may be terminated by the Underwriters by notice to
the Company at any time at or prior to Closing Time or such Date of Delivery, as
the case may be, and such termination shall be without liability of any party to
any other party except as provided in Section 4 hereof and except that Sections
1, 6 and 7 shall survive any such termination and remain in full force and
effect.
SECTION 6. Indemnification.
(a) The Company and the Operating Partnership, jointly and
severally agree to indemnify and hold harmless each Underwriter, its officers,
directors, employees and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
as follows:
24
<PAGE> 25
(i) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact contained in
the Registration Statement (or any amendment thereto), or the omission
or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto) or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or any
investigation or proceeding by any governmental or regulatory agency or
body, commenced or threatened, or of any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement
or omission; provided that (subject to Section 6(d) below) any such
settlement is effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as
incurred (including, subject to Section 6(c) hereof, the fees and
disbursements of counsel chosen by the Underwriters), reasonably
incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not paid
under (i) or (ii) above;
provided, however, that (i) this indemnity agreement shall not apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter expressly for use in the Registration Statement (or
any amendment thereto) or any preliminary prospectus supplement or the
Prospectus (or any amendment or supplement thereto), and (ii) that the Company
shall not be liable to any Underwriter under the indemnity agreement in this
subsection (a) with respect to any preliminary prospectus or preliminary
prospectus supplement to the extent that any such loss, claim, damage or
liability of such Under-
25
<PAGE> 26
writer results from the fact such Underwriter sold Securities to a person as to
whom there was not sent or given, at or prior to written confirmation of such
sale, a copy of the Prospectus as then amended or supplemented in any case where
such delivery is required by the 1933 Act if the Company has previously
furnished copies thereof to such Underwriter and the loss, claim, damage or
liability of such Underwriter results from an untrue statement or omission of a
material fact contained in the preliminary prospectus or preliminary prospectus
supplement which was corrected in the Prospectus or in the Prospectus as then
amended or supplemented.
(b) Each Underwriter severally agrees to indemnify and
hold harmless the Company, its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act against
any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement (or any amendment thereto) or any
preliminary prospectus supplement or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company by such Underwriter expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
supplement or the Prospectus (or any amendment or supplement thereto). The
Company acknowledges that the statements set forth in the first two sentences of
the last paragraph of text on the cover page and in the second paragraph under
the caption "Underwriting" in the Prospectus constitute the only information
furnished in writing by or on behalf of any Underwriter expressly for use in the
Registration Statement relating to the Securities as originally filed or in any
amendment thereof, any related preliminary prospectus supplement or the
Prospectus or in any amendment thereof or supplement thereto, as the case may
be.
(c) Each indemnified party shall give notice as promptly
as reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure to
so notify an indemnifying party shall not relieve such indemnifying party from
any liability which it may have under this indemnity agreement to the extent
such indemnifying party was not materially prejudiced by such failure or
otherwise than on account of this indemnity agreement. In the case of parties
indemnified pursuant to Section 6(a) above, counsel to the indemnified parties
shall be selected by Merrill Lynch, and, in the case of parties indemnified
pursuant to Section 6(b) above, counsel to the indemnified parties shall be
selected by the Company. An indemnifying party may participate at its own
expense in the defense of any such action; provided, however, that counsel to
the indemnifying party shall not (except with the consent of the indemnified
party) also be counsel to the indemnified party. In no event shall the
indemnifying parties be liable for fees and expenses of more than one counsel
(in addition to any local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise
26
<PAGE> 27
or consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which indemnification or
contribution could be sought under this Section 6 or Section 7 hereof (whether
or not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional release of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
(d) If at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for fees and
expenses of counsel, such indemnifying party agrees that it shall be liable for
any settlement of the nature contemplated by Section 6(a)(ii) effected without
its written consent if (i) such settlement is entered into more than 45 days
after receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
Notwithstanding the immediately preceding sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, an indemnifying party shall
not be liable for any settlement of the nature contemplated by Section 6(a)(ii)
effected without its written consent if such indemnifying party (x) reimburses
such indemnified party in accordance with such request to the extent it
considers such request to be reasonable and (y) provides written notice to the
indemnified party substantiating the unpaid balance as unreasonable, in each
case prior to the date of such settlement.
SECTION 7. Contribution. If the indemnification provided for in
Section 6 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then the Company and the Operating
Partnership, on the one hand, and the Underwriters on the other hand, shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by the Company and the Operating Partnership, on the one
hand, and one or more of the Underwriters on the other hand, as incurred, (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Company and the Operating Partnership on the one hand and the Underwriters
on the other hand from the offering of the Securities pursuant to this Agreement
or (ii) if the allocation provided by clause (i) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company and the Operating Partnership on the one hand and of the Underwriters on
the other hand in connection with the statements or omissions which resulted in
such losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The relative benefits received by the Company and the Operating
Partnership on the one hand and the Underwriters on the other hand in connection
with the offering of the Securities pursuant to this Agreement shall be deemed
to be in the same respective proportions as the total net proceeds from the
offering of the Securities pursuant to this Agreement (before deducting
expenses) received by the Company as set forth on the cover of the Prospectus
and
27
<PAGE> 28
the total underwriting discount received by the Underwriters; provided, that,
such underwriting discount shall be calculated by using the difference between
(x) the price per share set forth in the Pricing Agreement at which the
Underwriters purchased the Securities from the Company and (y) the actual price
per share at which the Securities were sold to the public.
The relative fault of the Company and the Operating Partnership
on the one hand and the Underwriters on the other hand shall be determined by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company or by the Underwriters and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The Company, the Operating Partnership and the Underwriters agree
that it would not be just and equitable if contribution pursuant to this Section
7 were determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to above in this
Section 7. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this Section
7 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission.
No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls
an Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the number of Initial Securities set forth opposite their
respective names in Schedule A hereto and not joint.
28
<PAGE> 29
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement and the Pricing Agreement, or contained in certificates of officers of
the Company submitted pursuant hereto, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the Company, and shall
survive delivery of the Securities to the Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Underwriters may terminate
this Agreement, by notice to the Company, at any time at or prior to Closing
Time (i) if there has been, since the time of execution of this Agreement or
since the respective dates as of which information is given in the Prospectus,
any material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of or not arising in the ordinary course of business, or (ii) if
there has occurred any material adverse change in the financial markets in the
United States, any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development involving a prospective change
in national or international political, financial or economic conditions, in
each case the effect of which is such as to make it, in the judgment of the
Underwriters, impracticable to market the Securities or to enforce contracts for
the sale of the Securities, or (iii) if trading in any securities of the Company
has been suspended or materially limited by the Commission or the New York Stock
Exchange, or if trading generally on the American Stock Exchange or the New York
Stock Exchange or in the Nasdaq National Market has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system
or by order of the Commission, the National Association of Securities Dealers,
Inc. or any other governmental authority, or (iv) if a banking moratorium has
been declared by either federal, New York or California authorities.
(b) Liabilities. If this Agreement is terminated pursuant
to this Section, such termination shall be without liability of any party to any
other party except as provided in Section 4 hereof.
SECTION 10. Default by One or More of the Underwriters. If one or
more of the Underwriters shall fail at Closing Time or a Date of Delivery to
purchase the Securities which it or they are obligated to purchase under this
Agreement and the Pricing Agreement (the "Defaulted Securities"), the
Underwriters shall have the right, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth; if, however, the Underwriters shall not have completed such arrangements
within such 24-hour period, then:
29
<PAGE> 30
(a) if the number of Defaulted Securities does not exceed
10% of the number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that their respective
underwriting obligations hereunder bear to the underwriting obligations of all
non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of
the number of Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the Underwriters to purchase and of the Company to sell the Option
Securities to be purchased and sold on such Date of Delivery shall terminate
without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement or, in the case of a Date of Delivery which is
after the Closing Time, which does not result in a termination of the obligation
of the Underwriters to purchase and the Company to sell the relevant Option
Securities, as the case may be, either the Underwriters or the Company shall
have the right to postpone Closing Time or the relevant Date of Delivery, as the
case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or Prospectus or in any other
documents or arrangements. As used herein, the term "Underwriter" includes any
person substituted for an Underwriter under this Section 10.
SECTION 11. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, 10900 Wilshire Boulevard, Suite 900, Los Angeles,
California 90024, attention of David L. Knowles; notices to the Company shall be
directed to it at Essex Property Trust, Inc., 777 California Avenue, Palo Alto,
California 94304, attention of Keith R. Guericke, with a copy to Morrison &
Foerster LLP, 755 Page Mill Road, Palo Alto, California 94304-1018.
SECTION 12. Parties. This Agreement and the Pricing Agreement
shall each inure to the benefit of and be binding upon the Underwriters, the
Company and the Operating Partnership and their respective successors. Nothing
expressed or mentioned in this Agreement or the Pricing Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters, the Company, the Operating Partnership and their respective
successors and to the extent provided in Sections 6 and 7, the controlling
persons and officers and directors referred to in such Sections 6 and 7 and
their heirs and legal representatives, any legal or equitable right, remedy or
claim under or in respect of this Agreement or the Pricing Agreement or any
provision herein or therein contained. This Agreement and
30
<PAGE> 31
the Pricing Agreement and all conditions and provisions hereof and thereof are
intended to be for the sole and exclusive benefit o, and said controlling
persons and officers and directors and their heirs and legal representatives,
and for the benefit of no other person, firm or corporation. No purchaser of
Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT AND THE
PRICING AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN
SAID STATE. EXCEPT AS OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER
TO NEW YORK TIME.
31
<PAGE> 32
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the Underwriters, the Company and the Operating Partnership in accordance with
its terms.
Very truly yours,
ESSEX PROPERTY TRUST, INC.
By:
-------------------------------
Name: Michael J. Schall
Title: Executive Vice President and
Chief Financial Officer
ESSEX PORTFOLIO, L.P.
By: Essex Property Trust, Inc.
Its General Partner
By:
-------------------------------
Name: Jordan E. Ritter
Title: Vice President and Secretary
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Donaldson, Lufkin & Jenrette
Securities Corporation
Raymond James & Associates, Inc.
By: Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By:
-------------------------------
Name:
Title:
<PAGE> 33
SCHEDULE A
<TABLE>
<CAPTION>
Number of
Name of Underwriter Initial Securities
- ------------------- ------------------
<S> <C>
Merrill Lynch, Pierce, Fenner & Smith
Incorporated..................................... 500,000
Donaldson, Lufkin & Jenrette
Securities Corporation........................... 500,000
Raymond James & Associates, Inc.................................... 500,000
-------
TOTAL................................................ 1,500,000
</TABLE>
Sch A - 1
<PAGE> 1
EXHIBIT 1.2
EXHIBIT A
1,500,000 Shares of Common Stock
ESSEX PROPERTY TRUST, INC.
(a Maryland corporation)
(Par Value $0.0001 Per Share)
PRICING AGREEMENT
December 2, 1997
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Donaldson, Lufkin & Jenrette
Securities Corporation
Raymond James & Associates, Inc.
c/o MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281
Ladies and Gentlemen:
Reference is made to the Purchase Agreement dated December 2,
1997 (the "Purchase Agreement") among Essex Property Trust, Inc., a Maryland
corporation (the "Company"), Essex Portfolio, L.P., and Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Donaldson, Lufkin & Jenrette
Securities Corporation and Raymond James & Associates, Inc. (the
"Underwriters"). The Purchase Agreement provides for the purchase by the
Underwriters from the Company, subject to the terms and conditions set forth
therein, of the above shares of Common Stock (the "Initial Securities") and an
aggregate of 225,000 additional shares (the "Option Securities") of the
Company's
1
<PAGE> 2
Common Stock, par value $0.0001 per share. The Initial Securities and the Option
Securities are collectively hereinafter called the "Securities."
Pursuant to Section 2 of the Purchase Agreement, the Company
agrees with each Underwriter as follows:
(1) The purchase price per share for the Securities to be paid
by the Underwriters shall be $35.50.
(2) The public offering price per share for the Securities
shall be at market prices prevailing at the time of sale,
at prices related to prevailing market prices, or at
negotiated prices.
2
<PAGE> 3
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the Underwriters and the Company in accordance with its terms.
Very truly yours,
ESSEX PROPERTY TRUST, INC.
By:
-------------------------------
Name: Michael J. Schall
Title: Executive Vice President and
Chief Financial Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Donaldson, Lufkin & Jenrette
Securities Corporation
Raymond James & Associates, Inc.
By: Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By:
-------------------------------
Name:
Title:
