SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
------------------
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): December 1, 1999
First Washington Realty Trust, Inc.
(Exact Name of Registrant as
Specified in Charter)
Maryland 0-25230 52-1879972
(State or other (Commission File No.) (I.R.S. Employer
Jurisdiction of Identification No.)
Incorporation)
4350 East-West Highway
Suite 400
Bethesda, Maryland 20814
(Address of Principal
Executive Offices)
(301) 907-7800
(Registrant's telephone
number, including area code)
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ITEM 5. Other Events
As a prospective investor in securities of First Washington Realty Trust,
Inc., you should carefully consider the following risk factors.
Although First Washington Realty Trust, Inc., First Washington Realty
Limited Partnership and First Washington Management, Inc. are separate entities,
for ease of reference, the terms "the Company," "we," "us," and "ours" refer to
the business and properties of all of these entities, unless the context
indicates otherwise.
Risk Factors
We have substantial amounts of debt, which presents various risks.
We may have insufficient cash resources to make required payments of
principal and interest. At the current time, we have a significant level of
debt. We cannot guarantee that we can refinance or repay our existing
indebtedness at maturity. Also, the terms of any such refinancing may not be as
favorable as the terms of the existing financing. As of September 30, 1999, we
had outstanding approximately $270.6 million of long-term mortgage indebtedness.
Our debt to total market capitalization ratio is approximately 42.8%. We define
debt to market capitalization as debt divided by the sum of debt and the market
value of our outstanding partnership units and shares of common stock.
We will need to refinance much of our debt. Only a small portion of the
principal of our mortgage indebtedness will be repaid prior to maturity and we
do not plan to retain in advance enough cash to repay all of this indebtedness
at maturity. Therefore, we will have to refinance this debt through additional
debt financing or equity offerings. From 2000 through 2014, we will have to
refinance an aggregate of approximately $213 million of debt, and our mortgage
indebtedness requires balloon payments of $24.4 million in 2000. If we cannot
refinance this indebtedness on acceptable terms, we may have to dispose of
properties upon disadvantageous terms, which may result in losses to us and
lower distributions to stockholders. If the refinancing has a higher interest
rate, our interest expense would increase, which would limit the amount of cash
to pay expected distributions to stockholders. Further, if we cannot meet
mortgage payments, we could lose the mortgaged property or properties through
foreclosure. Even if the indebtedness is otherwise nonrecourse, the lender may
have the right to recover deficiencies from us in certain circumstances,
including environmental liabilities.
Rising interest rates could cause us to pay more interest. At September 30,
1999, $26.2 million of our debt carried a variable interest rate, and we may
incur additional debt in the future that also bears interest at variable rates.
If market interest rates increase, our debt service requirements would also
increase.
We can incur additional debt. While not required by our organizational
documents, we have a policy of maintaining a ratio of debt to total market
capitalization of 50% or less. However, our charter and bylaws do not contain
any debt incurrence restrictions and the board of directors could alter or
eliminate this policy.
Some of our properties secure more than a single mortgage loan. A total of
13 properties are cross-collateralized with one or more other properties. A
default in a single loan which is cross-collateralized by other properties may
result in the foreclosure on all of the properties by the mortgagee with a
consequent loss of income and asset value to us.
We have experienced operating losses.
We historically have experienced losses allocated to common stockholders
before extraordinary items. For the years ending December 31, 1996, 1995 and
1994 we incurred losses allocated to common stockholders of $0.46, $1.19, and
$0.95 per share, respectively. These net losses reflect substantial non-cash
charges such as depreciation and amortization and the effect of distributions to
holders of the convertible preferred stock.
The terms of our preferred stock limit the amount of dividends we can pay
to our common stockholders.
When the board of directors authorizes distributions, each share of
convertible preferred stock is entitled to receive distributions equal to
$0.6094 per quarter. Each shareof convertible preferred stock is also entitled
to a participating distribution, which is equal to the amount of distributions
in excess of $0.4875 per quarter payable to the common stock multiplied by the
number of shares of common stock into which the convertible preferred stock is
then convertible. The payment of distributions to the convertible preferred
stockholder reduces the income allocable to the holders of common stock, which
causes a decrease in common stockholders' equity. The entitlement of the
convertible preferred stockholders to participating distributions limits the
level of distributions we can pay on the outstanding shares of common stock.
Our properties are concentrated in the Mid-Atlantic region.
Local economic and real estate conditions could affect our results. Our
properties are located primarily in the Mid-Atlantic region. More particularly,
approximately 35.8% of the total gross leasable area of our properties is
located in the Washington-Baltimore corridor. Adverse economic developments in
this area could adversely impact the operations of our properties and therefore
our profitability. The concentration of properties in a limited number of
markets may expose us to risk of adverse economic developments which are greater
than the risks of owning properties in several markets.
Environmental problems are possible and could be costly.
Various federal, state and local laws, ordinances and regulations subject
property owners or operators to liability for the costs of removal or
remediation of hazardous substances released on a property. These laws often
impose liability without regard to whether the owner or operator knew of, or was
responsible for, the release of the hazardous substances. The presence or the
failure to properly remediate hazardous substances may adversely affect our
ability to sell, rent or borrow against contaminated property. In addition to
the costs associated with investigation and remediation actions brought by
governmental agencies, the presence of hazardous wastes on a property could
result in personal injury or similar claims by private plaintiffs.
Various laws also impose, on persons who arrange for the disposal or
treatment of hazardous or toxic substances, liability for the cost of removal or
remediation of hazardous substances at the treatment facility. These laws often
impose liability whether or not the person arranging for the disposal ever owned
or operated the disposal facility.
Independent environmental consultants have completed Phase I or similar
environmental audits on all of our properties. Phase I environmental site
assessments are intended to identify potential sources of contamination for
which a company may be responsible and to assess the status of environmental
regulatory compliance. An environmental audit involves general inspections
without soil sampling or groundwater analysis. These environmental assessments
and audits indicate that dry cleanin solvents, petroleum and/or hydraulic fluid
have been detected in the soil and/or groundwater at seven of our properties.
Existing environmental studies of our properties may not have revealed all
environmental conditions, liabilities or compliance concerns. Also,
environmental conditions, liabilities or compliance concerns may have arisen at
a property after the related review was completed.
Our third-party management, leasing and related service business presents
various risks.
Management contracts are generally terminable on short notice. We intend to
pursue actively the management, including contracts to lease space, of
properties owned by third parties. Managing properties owned by third parties
presents risks, including:
Management and leasing contracts may generally be canceled upon 30 days'
notice or upon other events, including sale of the property. The property owner
may terminate these contracts, or we may lose the contracts in connection with a
sale of the property.
Contracts may not be renewed upon expiration or may not be renewed on terms
consistent with current terms.
Management fees are based on rental revenues which may decline as a result
of general or specific market conditions.
We have limited control over the business of First Washington Management.
Certain members of our management, own 100% of the voting common stock of First
Washington Management and have the ability to elect the board of directors of
First Washington Management. Consequently, we have no ability to influence the
decisions of First Washington Management. As a result, the board of directors
and management of First Washington Management may implement business policies or
decisions that are adverse to our interests or that lead to adverse financial
results. The voting common stock of First Washington Management is subject to an
assignable right of first refusal held by Stuart D. Halpert and William J.
Wolfe.
Our REIT status limits the business of First Washington Management. Certain
requirements for REIT qualification may limit our ability to increase
third-party management, leasing and related services offered by First Washington
Management.
Some of our management team have conflicts of interest regarding the sale of
some of our properties.
Holders of common units may suffer adverse tax consequences upon the sale
or refinancing of property contributed to First Washington Limited Partnership
in exchange for units. Therefore, holders of common units, including members of
our management may have their own objectives regarding the appropriate pricing
and timing of a property's sale or refinancing. Although we, as the general
partner of First Washington Limited Partnership have the exclusive authority to
sell or refinance an individual property, officers and directors who hold common
units may influence us not to sell or refinance, or repay debt collateralized by
properties originally owned directly or indirectly by these officers or
directors and which were contributed to First Washington Limited Partnership.
Even though a sale or refinancing might be financially advantageous to
stockholders, the sale or refinancing might trigger adverse tax consequences for
the officer or director who originally had an ownership interest i the
contributed property. In the aggregate, management holds under 1.0 % of the
common units of First Washington Limited Partnership. Policies adopted by the
Board to minimize the impact of this conflict may not succeed in eliminating the
influence of officers and directors who hold common units.
We can change our investment and financing policies without stockholder
approval.
The board of directors determines our investment and financing policies,
and our policies with respect to other activities, including our growth, debt,
capitalization, distributions, REIT status and operating policies. Although they
have no present intention to do so, the board of directors may amend or revise
these policies from time to time without notice to or a vote of our
stockholders. Accordingly, stockholders may not have control over changes in our
policies.
Our executive officers have substantial influence over our affairs.
As of December 31, 1998, our officers as a group beneficially owned
approximately 10.5% of the total issued and outstanding shares of common stock,
assuming exchange of common units and exercise of options, and 5.5% of the
outstanding shares of common stock, assuming the exchange and/or conversion of
all other securities convertible into common stock. They have substantial
influence on us which might not be consistent with the interests of our other
stockholders. Also, they may in the future have a substantial influence on the
outcome of any matters submitted to our stockholders for approval.
We are dependent on a very limited number of key personnel.
We depend on the efforts of our executive officers, particularly Messrs.
Halpert and Wolfe. While we believe that we could replace these individuals, the
loss of their services could have an adverse effect on our operations. Messrs.
Halpert and Wolfe have entered into employment and non-compete agreements with
us.
We face risks common to all real estate companies.
Our ability to make expected distributions to stockholders depends on our
ability to generate funds from operations in excess of scheduled principal
payments on debt and capital expenditure requirements. Events and conditions
beyond our control may adversely affect funds from operations and the value of
our properties. Examples include:
an adverse economic climate, particularly in the Mid-Atlantic Region;
attractiveness of properties to tenants;
an oversupply of space or reduction of demand for space in the areas where we
operate;
competition from other retail properties;
our ability to provide adequate maintenance and insurance;
increased operating costs, including insurance premiums, real estate taxes,
repair costs and renovation costs;
changes in market rental rates;
the availability of financing and interest rate levels;
zoning or other regulatory restrictions;
changes in traffic patterns; and
environmental liability.
New acquisitions and developments could fail to perform as expected.
Acquisition and development of neighborhood shopping centers entails risks that
investments will fail to perform in accordance with our expectations. Expansion,
renovation and development projects generally require expenditure of capital as
well as various government and other approvals, which cannot be assured. We will
incur risks, including expenditures of funds on, and devotion of management's
time to, projects which we may not complete. Also, acquisition agreements could
fail to close. Although from time to time we enter into agreements for the
acquisition of retail properties, these agreements are subject to customary
conditions to closing, including completion of due diligence investigations to
our satisfaction. It is possible that these agreements may not be consummated.
Any of the foregoing could have a material adverse effect on our ability to make
anticipated distributions to you.
We are dependent upon the financial health of our tenants. We derive most
of our income from rental income. A tenant may experience a downturn in its
business, which may weaken its financial condition and result in its failure to
make timely rental payments. Also, when our tenants decide not to renew their
leases, we may not be able to relet the space. Even if tenants do renew, the
terms of renewal or reletting may not be as favorable as current lease terms.
Leases on 9.8% and 13.0% of the gross leasable area in the properties will be
expiring in 2000 and 2001, respectively. In the event of default by a lessee, we
may experience delays in enforcing our rights as lessor and may incur
substantial costs in protecting our investment.
The bankruptcy or insolvency of a major tenant may adversely affect the
income produced by our properties. As of September 30, 1999, six tenants were
involved in bankruptcy proceedings. These tenants represent approximately 0.693%
of the total annual minimum rents of our properties. These bankrupt tenants may
not continue to pay rent and additional tenants may become bankrupt or
insolvent.
Some of our properties are not anchored by a supermarket or drug store.
Nine of our properties are relatively small in size, with less than 50,000
square feet of gross leasable area, and are not anchored by a supermarket or
drug store tenant. These properties may experience greater variability in
consumer traffic.
Real estate investments are illiquid. We may not be able to sell properties
at the appropriate time. Equity real estate investments are relatively illiquid
and therefore tend to limit our ability to vary our portfolio promptly in
response to changes in economic or other conditions. Our properties primarily
are neighborhood shopping centers, and we do not presently intend to
substantially vary the types of real estate in our portfolio. In addition,
significant expenditures associated with each equity investment are generally
not reduced when circumstances cause a reduction in income from the investment.
These expenditures include mortgage payments, real estate taxes and maintenance
costs.
Some potential losses are not covered by insurance. Certain types of
losses, generally of a catastrophic nature, such as wars or earthquakes may be
either uninsurable or not economically insurable. Should an uninsured loss
occur, we could lose both our invested capital in and anticipated profits from a
property. In such event, we might nevertheless remain obligated to repay any
mortgage indebtedness on the property.
We face vigorous competition. Numerous companies compete with us in seeking
properties for acquisition and tenants who will lease space in these properties.
We may not be able to acquire suitable leased properties and tenants for our
properties in the future.
We could invest in mortgages. Although we currently have no plans to invest
in mortgages, we may invest in mortgages in the future. If we were to invest in
mortgages, we would incur the risks of this type of investment, which include:
borrowers may not be able to make debt service payments or pay principal when
due;
the value of mortgage property may be less than the amount owed; and
interest rates payable on the mortgages may be lower than our costs of funds.
Complying with the Americans with Disabilities Act and similar laws could
be costly. Under the Americans with Disabilities Act of 1990 all public
accommodations must meet federal requirements related to access and use by
disabled persons. Although we believe that our properties substantially comply
with present requirements of the act, we have not conducted an audit or
investigation of all of our properties to determine our compliance. We may incur
additional costs of complying with the act. A number of additional federal,
state and local laws also may require modifications to our properties, or
restrict our ability to renovate our properties. We cannot currently ascertain
the ultimate amount of the cost of compliance with the act or other legislation.
Although we do not expect such costs to have a material effect on us, such costs
could be substantial.
In order to protect our REIT status among other things, our charter contains
limitations on ownership of our capital stock.
Our charter contains restrictions on the ownership and transfer of our
capital stock. These restrictions aim to prevent concentration of stock
ownership. These limitations may:
discourage a change of control;
deter tender offers for the capital stock, which may be attractive to our
stockholders; or
limit the opportunity for stockholders to receive a premium for their capital
stock.
To maintain our qualification as a REIT, not more than 50% in value of our
outstanding capital stock may be owned by five or fewer individuals at any time
during the last half of our taxable year other than during the first taxable
year for which we elected to be taxed as a REIT. This requirement is referred to
as the "five or fewer" requirement. For purposes of this five or fewer
requirement, individuals include the entities that are set forth in Section
542(a)(2) of the Internal Revenue Code. In addition, rent from a related party
tenant, as defined in the Internal Revenue Code, is not qualifying income for
purposes of the REIT gross income test. Attribution rules in the Internal
Revenue Code determine if any individual or entity constructively owns our stock
under the "five or fewer" requirement and under the related party tenant rules.
Primarily because of fluctuations in values among the different classes of our
capital stock, the restrictions in our charter may not ensure that we will
satisfy the "five or fewer" requirement, or avoid receiving rent from a related
party tenant. If we do not satisfy the "five or fewer" requirement, our status
as a REIT will terminate. We will not be able to prevent such termination.
The board of directors may waive some of these limitations with respect to
a particular stockholder if it is satisfied, based upon the advice of tax
counsel, that ownership in excess of these limitations will not jeopardize our
status as a REIT. Any attempted acquisition, actual or constructive, of shares
by a person who, as a result, would violate one of these limitations will cause
the shares purportedly transferred to be automatically transferred to a trust
for the benefit of a charitable beneficiary or the transfer will be deemed void.
In addition, the following events will generally result in our automatic
repurchase of the violative shares:
* changes in the relative values of different classes of our capital stock
that would cause violations of the ownership limitations,
* a shareholder's election to convert all or a portion of our series A
preferred stock into our common stock that would cause a violation of the
ownership limitations, or
* our redemption or purchase of all or a portion of the outstanding shares of
our capital stock that would cause a violation of the ownership
limitations.
In addition, there are circumstances where a holder of convertible
preferred stock who is not otherwise in violation of the ownership limits could
be prevented from converting its convertible preferred stock into shares of
common stock.
Our charter also contains other provisions that may delay, defer, or prevent a
change of control.
We have a staggered Board. Our board of directors has been divided into
three classes of directors. The staggered terms for directors may reduce the
possibility of a tender offer or an attempt to change control even if a tender
offer or a change in control were in the stockholders' interest.
We could issue preferred stock without stockholder approval. Our charter
authorizes the board of directors to issue up to 10,000,000 shares of preferred
stock, including the convertible preferred stock. The board of directors may
establish the preferences, rights and other terms of any shares issued,
including the right to vote and the right to convert into common stock . The
issuance of preferred stock could delay or prevent a tender offer or a change in
control even if a tender offe or a change in control were in our stockholders'
interest. No shares of preferred stock other than the convertible preferred
stock are currently issued or outstanding.
We have exempted our Chairman and our CEO from the Maryland Business
Combination Law. The Maryland General Corporation Law, as currently in effect,
prohibits "business combinations" between a Maryland corporation and an
"interested stockholder" or an affiliate of an interested stockholder for five
years after the most recent date on which the interested stockholder becomes an
interested stockholder. An interested stockholder is any person who beneficially
owns ten percent or more of th voting power of the corporation's shares. After
the five-year prohibition, any business combination must be approved by two
supermajority stockholder votes unless, among other conditions, the
corporation's common stockholders receive a minimum price for their shares and
receive consideration in cash or in the same form as previously paid by the
interested stockholder for its shares. This means that, unless an exemption
applies, the transaction must be approved by at least:
80% of the votes entitled to be cast by holders of outstanding voting shares,
and
two-thirds of the votes entitled to be cast by holders of outstanding voting
shares other than shares held by the interested stockholder with whom or with
whose affiliate or associate the business combination is to be effected.
As permitted by the statute, our board of directors has exempted any
business combination involving Messrs. Halpert and Wolfe and any of their
affiliates or associates or any person acting in concert with any of such
persons. Consequently, the five-year prohibition and the super-majority vote
requirements described above will not apply to business combinations between us
and any of these people. As a result, Messrs. Halpert and Wolfe and other
persons referred to in the preceding sentence may be able to enter into business
combinations with us which may not be in the best interest of the stockholders.
In such case, we would not have to comply with the super-majority vote
requirements and other provisions of the statute.
We could adopt the Maryland Control Share Acquisition Statute. Maryland law
provides that "control shares" of a Maryland corporation acquired in a "control
share acquisition" have no voting rights except to the extent approved by a
stockholder vote. Two-thirds of the shares eligible to vote must vote in favor
of granting the "control shares" voting rights. "Control shares" are shares of
stock that, taken together with all other shares of stock the acquiror
previously acquired, would entitle the acquiror to exercise voting power in
electing directors within three ranges of voting power, beginning with one-fifth
of all voting power. Control shares do not include shares of stock the acquiring
person is entitled to vote as a result of having previously obtained stockholder
approval. A "control share acquisition" generally means the acquisition of
control shares.
If a person who has made or proposes to make a control share acquisition
agrees to pay expenses and satisfies other conditions, he may compel the board
of directors to call a special meeting of stockholders to be held within 50 days
to consider the voting rights of the shares. If this person makes no request for
a meeting, the corporation has the option to present the question at any
stockholders' meeting.
If voting rights are not approved at a meeting of stockholders then, the
corporation generally may redeem any or all of the control shares for fair
value, except those for which voting rights have previously been approved. Fair
value is determined without regard to the absence of voting rights for control
shares, as of the date of either:
the last control share acquisition; or
any meeting where stockholders considered and did not approve voting rights of
the control shares.
If voting rights for control shares are approved at a stockholders' meeting
and the acquiror becomes entitled to vote a majority of the shares of stock
entitled to vote, all other stockholders may exercise appraisal rights. Under
Maryland law, the fair value as determined for purposes of these appraisal
rights may not be less than the highest price per share paid in the control
share acquisition.
Pursuant to the statute, our bylaws contain a provision exempting from the
control share acquisition act any and all acquisitions by any person of our
shares of stock. Our board of directors may amend or eliminate this provision at
any time in the future.
We have a Stockholder Rights Plan. On October 10, 1998, our board of
directors adopted a stockholder rights plan and declared a distribution of one
preferred share purchase right for each outstanding share of common stock. The
rights were issued on October 26, 1998 to each stockholder of record on that
date. The rights have anti-takeover effects. The rights would cause substantial
dilution to a person or group that attempts to acquire us on terms that our
board of directors does not approve. We may redeem the shares for $.01 per
right, prior to the time that a person or group has acquired beneficial
ownership of 15% or more of our common stock. Therefore, the rights should not
interfere with any merger or business combination our board of directors
approves.
Our classification as a REIT depends on compliance with federal law. Failure to
qualify as a REIT would have serious adverse consequences.
The requirements for qualification as a REIT are technical and complex, and
we could fail to qualify. We believe we have operated so as to qualify as a REIT
under the Internal Revenue Code, commencing with our taxable year ended December
31, 1994. However, we may not have qualified, or may not remain qualified.
Qualification as a REIT involves the application of highly technical and complex
Internal Revenue Code provisions for which there are only limited judicial and
administrative interpretations. The determination of various factual matters and
circumstances not entirely within our control may affect our ability to qualify
as a REIT. For example, in order to qualify as a REIT, at least 95% of our gross
income in any year must be derived from qualifying sources. Also, we must make
distributions to stockholders aggregating annually at least 95% of our REIT
taxable income, excluding capital gains. In addition, legislation, new
regulations, administrative interpretations or court decisions may significantly
change the tax laws with respect to qualification as a REIT or the federal
income tax consequences of such qualification.
To qualify as a REIT, not more than 5% of our total assets may consist of
securities of one issuer. We believe that the value of the securities of First
Washington Management held by us did not exceed at any time 5% of the value of
our total assets and will not exceed such amount in the future. We based this
belief on the initial allocation of shares among participants in the formation
transactions and our opinion regarding the maximum value that could be assigned
to the existing and expected future assets and net operating income of First
Washington Management. If we fail to qualify as a REIT in any year, we would be
subject to federal income tax, including any applicable alternative minimum tax
on our taxable income at regular corporate rates. Distributions to shareholders
in any year in which we fail to qualify will not be deductible by us, nor will
they be required to be made. If this happens, to the extent of our current or
accumulated earnings and profits, all distributions to shareholders will be
dividends, and subject to limitations specified in the Internal Revenue Code,
corporate distributees may be eligible for the dividends-received deduction.
Unless we are entitled to relief under statutory provisions, we will also be
disqualified from taxation as a REIT for the four taxable years following the
year during which we lost our qualification. The additional tax would
significantly reduce the cash flow available for distribution to stockholders.
In order to satisfy the REIT qualifications, we might need to borrow money
to fund distributions to our stockholders. To qualify as a REIT, we generally
must distribute to our stockholders at least 95% of our net taxable income each
year. In addition, we will be subject to a 4% nondeductible excise tax on the
amount by which certain distributions paid by us in any calendar year are less
than the sum of 85% of ordinary income, 95% of capital gain net income and 100%
of undistributed income from prior years.
We might need to borrow funds on a short-term basis to meet the
distribution requirements necessary to qualify as a REIT. These short-term
borrowing needs could result from differences in timing between the actual
receipt of income and inclusion of income for tax purposes, or the effect of
non-deductible capital expenditures, the creation of reserves or required debt
or amortization payments. In this instance, we might need to borrow funds to
avoid adverse tax consequences even if then prevailing market conditions were
not generally favorable for these borrowings.
We continue to pay some taxes. Even if we qualify as a REIT, we will be
subject to some federal, state and local taxes on our income and property. In
addition, First Washington Management generally is subject to federal and state
income tax at regular corporate rates on its net taxable income, which includes
its management, leasing and related service business.
Our computer system could be vulnerable to the Year 2000 Problem.
Many of the world's computer systems currently record years in a two digit
format. These computer systems will be unable to properly interpret dates beyond
the year 1999, which could lead to disruptions in our operations. This problem
is commonly referred to as the Year 2000 issue.
Although we are taking steps to establish Year 2000 compliance, we cannot
guarantee that all of our systems will be Year 2000 compliant or that other
companies on which we rely will be timely converted. As a result, our operations
could be adversely affected.
Sales of a substantial number of shares of common stock, or the perception that
this could occur, could adversely affect prevailing prices for our common stock.
As of September 30, 1999, we have reserved:
* 3,757,325 shares of common stock for issuance upon exchange of common units
issued in connection with our formation and in connection with property
acquisitions.
* 3,451,344 shares of common stock for issuance upon conversion of
outstanding convertible preferred stock issued in connection with our
formation and in connection with property acquisitions. This convertible
preferred stock became convertible after May 31, 1999.
* 545,265 shares of common stock for issuance upon conversion of reserved
convertible preferred stock. These shares are reserved for exchange of
exchangeable preferred units issued in connection with the formation and
subsequent property acquisitions.
* 1,828,339 shares of common stock for issuance under our employee benefit
plans.
We have filed or have agreed to file registration statements covering the
issuance of shares of common stock and convertible preferred stock upon exchange
of common units and exchangeable preferred units and the resale of convertible
preferred stock issued in connection with our formation and subsequent property
acquisitions. We also have filed registration statements covering the sale of
common stock issued or to be issued under our employee benefit plans. The
exchange of partnership units for common stock and convertible preferred stock
will increase the number of outstanding shares of common stock and convertible
preferred stock, and will increase our percentage ownership interest in First
Washington Limited Partnership.
ITEM 7(c). Exhibits
Exhibits
10.1 Second Amended and Restated Employment Agreement Between First Washington
Realty Trust, Inc. and William J. Wolfe, dated as of May 1, 1998, effective
as of March 13, 1998.*
10.2 Second Amended and Restated Employment Agreement Between First Washington
Realty Trust, Inc. and Stuart D. Halpert, dated as of May 1, 1998,
effective as of March 13, 1998.*
* Previously Filed.
<PAGE>
SIGNATURES
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.
FIRST WASHINGTON REALTY TRUST, INC.
By: /s/
James G. Blumenthal
Executive Vice President and
Chief Financial Officer
Date: December 23, 1999
<PAGE>
Exhibit Index
10.1 Second Amended and Restated Employment Agreement Between First Washington
Realty Trust, Inc. and William J. Wolfe, dated as of May 1, 1998, effective
as of March 13, 1998.*
10.2 Second Amended and Restated Employment Agreement Between First Washington
Realty Trust, Inc. and Stuart D. Halpert, dated as of May 1, 1998,
effective as of March 13, 1998.*
* Previously Filed.
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