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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (date of earliest event reported): November 12, 1998
(November 11, 1998)
Essex Property Trust, Inc.
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(Exact Name of Registrant as Specified in its Charter)
Maryland 1-13106 77-0369576
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation File Number) Identification No.)
925 East Meadow Drive, Palo Alto, CA 94303
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(Address of Principal Executive Offices) (Zip Code)
(650) 494-3700
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Registrant's Telephone Number
Including Area Code
N/A
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Former Name or Former Address, if Changed Since Last Report
Exhibit Index is on Page 8
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ITEM 5. OTHER EVENTS.
I. ADOPTION OF RIGHTS PLAN
On October 13, 1998, the Board of Directors of Essex Property Trust,
Inc. (the "Company"), declared a dividend distribution of one Right for each
outstanding share of Common Stock to stockholders of record at the close of
business on November 21, 1998 (the "Record Date"). Each Right entitles the
registered holder to purchase from the Company one one-hundredth of a share of
Series A Junior Participating Preferred Stock, par value $.0001 per share (the
"Preferred Stock"), at a Purchase Price of $99.13, subject to adjustment. The
description and terms of the Rights are set forth in a Rights Agreement (the
"Rights Agreement") between the Company and BankBoston, N.A., a national banking
association, as Rights Agent.
Initially, the Rights will be attached to all Common Stock
certificates representing shares then outstanding, and no separate Rights
Certificates will be distributed. The Rights will separate from the Common
Stock and a Distribution Date will occur upon the earlier of (i) ten (10) days
following a public announcement that a person or group of affiliated or
associated persons (an "Acquiring Person") has acquired, or obtained the right
to acquire, beneficial ownership of fifteen percent (15%) or more of the
outstanding shares of Common Stock (unless such person is or becomes the
beneficial owner of 15% or more of the Company's outstanding common stock and
had a contractual right or the approval of the Company's Board of Directors;
PROVIDED that such percentage shall not be greater than nineteen and nine-tenths
percent (19.9%)) (the "Stock Acquisition Date"), other than as a result of
repurchases of stock by the Company, or (ii) ten (10) business days (or such
later date as the Board shall determine) following the commencement of a tender
offer or exchange offer that would result in a person or group becoming an
Acquiring Person. Until the Distribution Date, (i) the Rights will be evidenced
by the Common Stock certificates and will be transferred with and only with such
Common Stock certificates, (ii) new Common Stock certificates issued after the
Record Date will contain a notation incorporating the Rights Agreement by
reference and (iii) the surrender or transfer of any certificates
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for Common Stock outstanding will also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate. Pursuant to
the Rights Agreement, the Company reserves the right to require prior to the
occurrence of a Triggering Event (as defined below) that, upon any exercise of
Rights, a number of Rights be exercised so that only whole shares of Preferred
Stock will be issued.
The Rights are not exercisable until the Distribution Date and will
expire at the close of business on November 11, 2008, unless earlier redeemed or
exchanged by the Company as described below.
While the rights are outstanding, after the commencement of a tender
offer for 15% or more of the Company's outstanding common stock (or the
acquisition of such amount), and prior to the rights becoming exercisable, the
Company has covenanted that it shall issue the Company's common stock, in lieu
of cash, along with the associated Right, to any Person who elects to exchange
units of limited partnership interest in the Company's Operating Partnership,
Essex Portfolio, L.P.
As soon as practicable after the Distribution Date, Rights
Certificates will be mailed to holders of record of the Common Stock as of the
close of business on the Distribution Date and, thereafter, the separate Rights
Certificates alone will represent the Rights. Except as otherwise determined by
the Board, only shares of Common Stock issued prior to the Distribution Date
will be issued with Rights.
In the event that a person becomes an Acquiring Person (except
pursuant to an offer for all outstanding shares of Common Stock that the
independent directors determine to be fair to and not inadequate and otherwise
in the best interests of the Company and its stockholders), each holder of a
Right will thereafter have the right to receive, upon exercise, at the option of
the Board of Directors, (i) Common Stock, (ii) one one-hundredths of a share of
Series A Junior Participating Preferred Stock and/or (ii) cash, property or
other securities of the Company, each of (i), (ii) and (iii) having a value
equal to two times the exercise price of the Right. Notwithstanding any of the
foregoing, following the occurrence of the event set forth in this
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paragraph, all Rights that are, or (under certain circumstances specified in
the Rights Agreement) were, beneficially owned by any Acquiring Person will be
null and void. However, Rights are not exercisable following the occurrence of
the event set forth above until such time as the Rights are no longer
redeemable by the Company as set forth below.
For example, at an exercise price of $100 per Right, each Right not
owned by an Acquiring Person (or by certain related parties) following an event
set forth in the preceding paragraph would entitle its holder to purchase $200
worth of Common Stock (or other consideration, as noted above) for $100.
Assuming that the Common Stock had a per share value of $20.00 at such time, the
holder of each valid Right would be entitled to purchase ten shares of Common
Stock for $100.
In the event that, at any time following the Stock Acquisition Date,
(i) the Company is acquired in a merger or other business combination
transaction in which the Company is not the surviving corporation (other than a
merger which follows an offer described in the second preceding paragraph), or
(ii) fifty percent (50%) or more of the Company's assets, cash flow or earning
power is sold or transferred, each holder of a Right (except Rights which
previously have been voided as set forth above) shall thereafter have the right
to receive, upon exercise, common stock of the acquiring company having a value
equal to two times the exercise price of the Right. The events set forth in
this paragraph and in the second preceding paragraph are referred to as the
"Triggering Events."
At any time after a person becomes an Acquiring Person and prior to
the acquisition by such person or group of fifty percent (50%) or more of the
outstanding Common Stock, the Board may exchange the Rights (other than Rights
owned by such person or group which have become void), in whole or in part, at
an exchange ratio of one share of Common Stock, or one one-hundredths of a share
of Preferred Stock (or of a share of a class or series of the Company's
preferred stock having equivalent rights, preferences and privileges), per Right
(subject to adjustment).
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At any time until ten (10) days following the Stock Acquisition Date,
the Company may redeem the Rights in whole, but not in part, at a price of $.01
per Right (payable in cash, Common Stock or other consideration deemed
appropriate by the Board). Immediately upon the action of the Board ordering
redemption of the Rights, the Rights will terminate and the only right of the
holders of Rights will be to receive the $.01 redemption price. The foregoing
notwithstanding, the Rights generally may not be redeemed for one hundred eighty
(180) days following a change in a majority of the Board as a result of a proxy
contest.
At any time, prior to the Expiration Date, from and after the Stock
Acquisition Date and before the Distribution Date, the Company has covenanted
that it shall elect to issues shares of Common Stock, along with the associated
Right, to any Person who elects to exchange units of limited partnership
interest in the Company's Operating Partnership, Essex Portfolio, L.P.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends. While the distribution of the Rights will not
be taxable to stockholders or to the Company, stockholders may, depending upon
the circumstances, recognize taxable income in the event that the Rights become
exercisable for Common Stock, Preferred Stock or other consideration of the
Company or for common stock of the acquiring company as set forth above.
Any of the provisions of the Rights Agreement may be amended by the
Board prior to the Distribution Date (other than Section 25(c) or Section 30
which shall require the consent of each holder of convertible securities whose
rights would be materially adversely affected by such amendment). After the
Distribution Date, the provisions of the Rights Agreement may be amended by the
Board in order to cure any ambiguity, to make changes which do not adversely
affect the interests of holders of Rights, or to shorten or lengthen any time
period under the Rights Agreement; PROVIDED, HOWEVER, that no amendment may be
made at such time as the Rights are not redeemable.
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The Rights Agreement, dated as of November 11, 1998, between the
Company and BankBoston, N.A., a national banking association, as Rights Agent,
specifying the terms of the Rights and including the form of the Articles
Supplementary, the press release announcing the declaration of the Rights and a
form of letter to the Company's stockholders describing the Rights are attached
hereto as exhibits and are incorporated herein by reference. The foregoing
description of the Rights is qualified in its entirety by reference to such
exhibits.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
4 Rights Agreement, dated as of November 11, 1998, between Essex
Property Trust, Inc., and BankBoston, N.A., as Rights Agent, including
all exhibits thereto, incorporated herein by reference to Exhibit 1 to
the Company's Registration Statement on Form 8-A dated November 12,
1998.
20(a) Press Release of the Company dated November 11, 1998, incorporated
herein by reference to Exhibit 2 to the Company's Registration
Statement on Form 8-A dated November 12, 1998.
20(b) Form of letter to the Company's stockholders describing the Rights,
incorporated herein by reference to Exhibit 3 to the Company's
Registration Statement on Form 8-A dated November 12, 1998.
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SIGNATURE
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 thereto duly authorized.
Essex Property Trust, Inc.
Date: November 12, 1998 By: /s/ Michael J. Schall
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Name: Michael J. Schall
Title: Chief Financial
Officer, Executive
Vice President and
Director
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EXHIBIT INDEX
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Exhibit Description Page
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4 Rights Agreement, dated as of N/A
November 11, 1998, between Essex
Property Trust, Inc. and
BankBoston, N.A., as Rights
Agent, including all exhibits
thereto, incorporated herein by
reference to Exhibit 1 to the
Company's Registration Statement
on Form 8-A dated November 12,
1998.
20(a) Press Release of the Company N/A
dated November 11, 1998,
incorporated herein by reference
to Exhibit 2 to the Company's
Registration Statement on Form
8-A dated November 12, 1998.
20(b) Form of letter to the Company's N/A
stockholders describing the
Rights, incorporated herein by
reference to Exhibit 3 to the
Company's Registration Statement
on Form 8-A dated November 12,
1998.
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