Exhibit 1.01
Execution Copy
FEDERAL REALTY INVESTMENT TRUST
Debt Securities
---------------
Underwriting Agreement
November 14, 2002
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
SALOMON SMITH BARNEY INC.
WACHOVIA SECURITIES, INC.
COMMERZBANK CAPITAL MARKETS CORP.
BANC OF AMERICA SECURITIES LLC
BMO NESBITT BURNS CORP.
FLEET SECURITIES, INC.
HVB CAPITAL MARKETS, INC.
WELLS FARGO BROKERAGE SERVICES, LLC
PNC CAPITAL MARKETS, INC.
c/o Merrill Lynch, Pierce, Fenner & Smith
Incorporated
4 World Financial Center
New York, New York 10080
Ladies and Gentlemen:
From time to time Federal Realty Investment Trust, a Maryland real
estate investment trust (the "Company"), proposes to enter into one or more
Pricing Agreements (each a "Pricing Agreement") in substantially the form of
Annex I hereto, with such additions and deletions as the parties thereto may
determine, and, subject to the terms and conditions stated herein and therein,
to issue and sell to the firms named in Schedule I to the applicable Pricing
Agreement (such firms constituting the "Underwriters" with respect to such
Pricing Agreement and the securities specified therein) certain of its debt
securities (the "Securities") specified in Schedule II to such Pricing Agreement
(with respect to such Pricing Agreement, the "Designated Securities").
The terms and rights of any particular issuance of Designated
Securities shall be as specified in the Pricing Agreement relating thereto and
in or pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made from time to
time to the Underwriters of such Securities, for whom the firms designated as
representatives of the
Underwriters of such Securities in the Pricing Agreement relating thereto will
act as representatives (the "Representatives"). The term "Representatives" also
refers to a single firm acting as sole representative of the Underwriters and to
Underwriters who act without any firm being designated as their representative.
This Underwriting Agreement shall not be construed as an obligation of the
Company to sell any of the Securities or as an obligation of any of the
Underwriters to purchase the Securities. The obligation of the Company to issue
and sell any of the Securities and the obligation of any of the Underwriters to
purchase any of the Securities shall be evidenced by the Pricing Agreement with
respect to the Designated Securities specified therein. Each Pricing Agreement
shall specify the aggregate principal amount of such Designated Securities, the
initial public offering price of such Designated Securities, the purchase price
to the Underwriters of such Designated Securities, the names of the Underwriters
of such Designated Securities, the names of the Representatives of such
Underwriters and the principal amount of such Designated Securities to be
purchased by each Underwriter and shall set forth the date, time and manner of
delivery of such Designated Securities and payment therefor. The Pricing
Agreement shall also specify (to the extent not set forth in the Indenture and
the registration statement and prospectus with respect thereto) the terms of
such Designated Securities. A Pricing Agreement shall be in the form of an
executed writing (which may be in counterparts), and may be evidenced by an
exchange of telecopied communications or any other rapid transmission device
designed to produce a written record of communications transmitted. The
obligations of the Underwriters under this Agreement and each Pricing Agreement
shall be several and not joint.
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-63619) in
respect of the Securities has been filed with the Securities and
Exchange Commission (the "Commission"); the Registration Statement (as
defined below) and any post-effective amendments thereto, each in the
form heretofore delivered or made available to the Representatives,
excluding exhibits to such Registration Statement, but including all
documents incorporated by reference in the prospectus contained
therein, have been declared effective by the Commission in such form;
and including the registration statement increasing the size of the
offering (the "Rule 462(b) Registration Statement"), filed pursuant to
Rule 462(b) under the Securities Act of 1933, as amended (the "Act"),
which became effective upon filing; no other documents with respect to
the Registration Statement have heretofore been filed or transmitted
for filing with the Commission (other than prospectuses filed pursuant
to Rule 424(b) under the Act, each in the form heretofore delivered to
the Representatives); and no stop order suspending the effectiveness of
the Registration Statement, any post-effective amendments thereto or
the Rule 462(b) Registration Statement has been issued and no
proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in the Registration
Statement or filed with the Commission pursuant to Rule 424 under the
Act is hereinafter called a "Preliminary Prospectus"); the various
parts of the Registration Statement and the Rule 462(b) Registration
Statement, if any, including all exhibits thereto and the
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documents incorporated by reference in the prospectus contained in the
Registration Statement at the time such part of the registration
statement became effective but excluding Form T-1, each as amended at
the time such part of the Registration Statement became effective or
such part of the Rule 462(b) Registration Statement became effective,
are hereinafter collectively called the "Registration Statement"; the
prospectus relating to the Securities, in the form in which it has most
recently been filed, or transmitted for filing, with the Commission on
or prior to the date of this Agreement, is hereinafter called the
"Prospectus"; any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under
the Act, as of the date of such Preliminary Prospectus or Prospectus,
as the case may be; any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include any documents filed after the date of such Preliminary
Prospectus or Prospectus, as the case may be, under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and incorporated
by reference in such Preliminary Prospectus or Prospectus, as the case
may be; any reference to any amendment to the Registration Statement
shall be deemed to refer to and include any annual report of the
Company filed pursuant to Section 13(a) or 15(d) of the Exchange Act
after the effective date of the Registration Statement that is
incorporated by reference in the Registration Statement; any reference
to the Prospectus as amended or supplemented shall be deemed to refer
to the Prospectus as amended or supplemented in relation to the
applicable Designated Securities in the form in which it is filed with
the Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof, including any documents incorporated by reference
therein as of the date of such filing; all references herein to
information which is "contained" or "included" in the Registration
Statement, any Preliminary Prospectus, any Prospectus, any Prospectus
as amended or supplemented or any Rule 434 Prospectus (and all
references of like import) shall be deemed to mean and include all such
information which is incorporated or deemed to be incorporated by
reference therein; and if the Company elects to rely on Rule 434 under
the Act, any reference to the Prospectus shall be deemed to include,
without limitation, the form of prospectus and the abbreviated term
sheet, taken together, provided to the Underwriters by the Company in
reliance on Rule 434 under the Act (the "Rule 434 Prospectus");
(b) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case
may be, conformed in all material respects to the requirements of the
Act or the Exchange Act, as applicable, and the rules and regulations
of the Commission thereunder, and none of such documents 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 in light of the circumstances under which they
were made; and any further documents so filed and incorporated by
reference in the Prospectus or any further amendment or supplement
thereto, when such documents become effective or are filed with the
Commission, as the case may
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be, will conform in all material respects to the requirements of the
Act or the Exchange Act, as applicable, and the rules and regulations
of the Commission thereunder 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; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating
to such Securities;
(c) The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements
of the Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the rules and regulations of the Commission
thereunder as of the applicable effective date as to the Registration
Statement and any amendment or supplement thereto, and do not and will
not, as of such effective date or filing, 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 in light of the circumstances under which they were made;
provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating
to such Securities;
(d) The Company has been duly organized and is validly existing and
in good standing as a real estate investment trust under the laws of
the State of Maryland, with full power and authority to own, lease and
operate its properties and conduct its business as described in the
Prospectus; the Company has interests in a number of entities
(collectively, the "Entities"), identified on Annex III, which have
been duly organized and are validly existing as corporations,
partnerships, limited liability corporations or joint ventures, as the
case may be, in good standing under the laws of the jurisdiction of
their organization (except for joint ventures, which have no good
standing certificate requirements), with full power and authority to
own, lease and operate their properties and conduct their business as
described in the Prospectus; except as otherwise denoted in Annex III
hereto, all of the equity interests in the Entities are owned by the
Company free and clear of all pledges, liens, encumbrances, claims,
security interests and defects; all of the issued and outstanding stock
of each Entity that is a corporation has been duly authorized and
validly issued and is fully paid and non-assessable; no options,
warrants or other rights to convert any obligations into partnership or
other ownership interests in the Entities are outstanding; and the
Company and the Entities are duly qualified to transact business in all
jurisdictions in which the Company and the Entities are transacting
business and in which the conduct of their respective businesses
requires such qualification, except where the failure to so qualify
would not have a material adverse effect on the condition, financial or
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otherwise, or on the earnings or business affairs of the Company and
the Entities considered as one enterprise;
(e) Neither the Company nor any of the Entities has sustained since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus; and, since the
date as of which information is given in the Prospectus, there has not
been any change in the authorized, issued and outstanding capital
shares of the Company (except for subsequent issuances, if any, of
Common Shares pursuant to (x) the Company's Dividend Reinvestment and
Share Purchase Plan as in effect on the date of the applicable Pricing
Agreement, (y) any of the Company's employee or trustee benefits plans,
including upon exercise of share options granted pursuant thereto, as
such plans are in effect on the date of the applicable Pricing
Agreement or (z) the exercise of contractual rights existing on the
date of the applicable Pricing Agreement by the current and former
holders of partnership or other interests in certain of the "DownREIT"
and other Entities listed in Annex III hereto which may result in the
issuance of Common Shares of the Company) or any increase in the
consolidated long-term debt of the Company or any material adverse
change, or any development involving a prospective material adverse
change, in or affecting the general affairs, management, financial
position, shareholders' equity or results of operations of the Company
and the Entities taken as a whole, otherwise than as set forth or
contemplated in the Prospectus;
(f) The Company has an authorized capitalization as set forth in the
Prospectus, all of the issued capital shares of the Company have been
duly and validly authorized and issued and are fully paid and
non-assessable, and none of the outstanding capital shares of the
Company was issued in violation of any preemptive or other similar
rights of any securityholder of the Company;
(g) The Securities have been duly and validly authorized, and, when
Designated Securities are issued and delivered pursuant to this
Agreement and the Pricing Agreement with respect to such Designated
Securities, such Designated Securities will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Company entitled to the benefits
provided by the Indenture, which will be substantially in the form
filed as an exhibit to the Registration Statement; the Indenture has
been duly authorized and duly qualified under the Trust Indenture Act
and, at the Time of Delivery for such Designated Securities (as defined
in Section 4 hereof), the Indenture will constitute a valid and legally
binding instrument, enforceable in accordance with its terms, subject,
as to enforcement, to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting creditors'
rights and to general equity principles; and the Indenture conforms,
and the Designated Securities will conform, to the descriptions thereof
contained in
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the Prospectus as amended or supplemented with respect to such
Designated Securities;
(h) The issue and sale of the Designated Securities and the
compliance by the Company with all of the provisions of the Designated
Securities, this Agreement and any Pricing Agreement, and the
consummation of the transactions herein and therein contemplated, will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of the Entities is a party or by
which the Company or any of the Entities is bound or to which any of
the property or assets of the Company or any of the Entities is
subject, nor will such action result in any violation of the provisions
of the Declaration of Trust or Bylaws of the Company or any statute or
any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company or any of the Entities or any
of their properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Securities or
the consummation by the Company of the transactions contemplated by
this Agreement or any Pricing Agreement or the Indenture, except such
as have been, or will have been prior to the Time of Delivery (as
defined in Section 4 hereof), obtained under the Act and the Trust
Indenture Act and except for any listing of the Designated Securities
on the New York Stock Exchange, Inc. ("NYSE") or other stock exchanges
and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or blue sky
laws in connection with the purchase and distribution of the Securities
by the Underwriters;
(i) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of the
Entities is a party or of which any property of the Company or any of
the Entities is the subject which, if determined adversely to the
Company or any of the Entities, would individually or in the aggregate
have a material adverse effect on the consolidated financial position,
shareholders' equity or results of operations of the Company and the
Entities; and, to the best of the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities
or threatened by others;
(j) The consolidated financial statements of the Company and the
Entities, together with related notes and schedules as set forth or
incorporated by reference in the Registration Statement, present fairly
the financial position and the results of operations of the Company and
the Entities at the indicated dates and for the indicated periods. Such
consolidated financial statements have been prepared in accordance with
generally accepted accounting principles, consistently applied
throughout the periods involved, and all adjustments necessary for a
fair presentation of results for such periods have been made. The
summary financial and statistical data contained in the Prospectus
present fairly the information
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shown therein and have been compiled on a basis consistent with the
consolidated financial statements incorporated by reference therein;
(k) The Company and the Entities have good and marketable title to,
or valid and enforceable leasehold estates in, all items of real and
personal property referred to in the Prospectus as owned or leased by
the Company or any of the Entities, in each case free and clear of all
pledges, liens, encumbrances, claims, security interests and defects,
other than those referred to in the Prospectus or which are not
material in amount;
(l) The Company and the Entities have filed all federal, state,
local and foreign income tax returns which have been required to be
filed, or appropriate extensions for such filings have been obtained as
required by law, and all federal, state, local and foreign taxes of the
Company and the Entities have been paid except such taxes as are not
yet due or are being contested in good faith;
(m) The Company and each of the Entities hold all material licenses,
certificates and permits from governmental authorities which are
necessary to the conduct of their respective businesses; and neither
the Company nor any of the Entities has infringed any patents, patent
rights, trade names, trademarks or copyrights, which infringement is
material to the business of the Company;
(n) To our knowledge, Arthur Andersen LLP, which audited the
consolidated balance sheets of the Company and subsidiaries as of
December 31, 2000, and 2001 and the related consolidated statements of
operations, common shareholders' equity, and cash flows for each of the
years in the three year period ended December 31, 2001, filed with the
Commission as part of, or incorporated by reference in, the
Registration Statement and Prospectus, was, at all times until its
replacement as the Company's auditor in June 2002, an independent
public accountant as required by the Act and the rules and regulations
of the Commission promulgated thereunder;
(o) The conditions for use of registration statements on Form S-3
set forth in the General Instructions on Form S-3 have been satisfied
and the Company is entitled to use such form for the transaction
contemplated herein;
(p) Although the Company is aware of the presence of hazardous
substances, hazardous materials, toxic substances or waste materials
("Hazardous Materials") on certain of its properties, nothing has come
to the attention of the Company which, at this time, would lead the
Company to believe that the presence of such Hazardous Materials, when
considered in the aggregate, would materially adversely affect the
financial condition of the Company. In connection with the construction
on or operation and use of the properties owned or leased by the
Company or the Entities, the Company represents that, as of the date of
this Agreement, it has no knowledge of any material failure by the
Company or the Entities to comply with all applicable local, state and
federal environmental laws, regulations, ordinances and administrative
and judicial orders relating to the
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generation, recycling, reuse, sale, storage, handling, transport and
disposal of any Hazardous Materials; and
(q) With respect to all tax periods regarding which the Internal
Revenue Service is or will be entitled to assert any claim, the Company
has met the requirements for qualification as a real estate investment
trust under Sections 856 through 860 of the Internal Revenue Code of
1986, as amended (the "Code"), and the Company's present and
contemplated operations, assets and income continue to meet such
requirements; and the Company is neither an "investment company" nor a
company "controlled" by an "investment company" within the meaning of
the Investment Company Act of 1940, as amended.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Securities and authorization by the Representatives of the release of
such Designated Securities, the several Underwriters propose to offer such
Designated Securities for sale upon the terms and conditions set forth in the
Prospectus as amended or supplemented.
4. Designated Securities to be purchased by each Underwriter pursuant
to the Pricing Agreement relating thereto, in the form specified in such Pricing
Agreement, and in such authorized denominations and registered in such names as
the Representatives may request upon at least 48 hours' prior notice to the
Company, shall be delivered by or on behalf of the Company to the
Representatives for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by wire transfer of
federal or other immediately available funds to an account at a bank located in
one of the 48 contiguous states of the United States of America (which account
shall be designated by the Company upon at least 48 hours' prior notice to the
Representatives), all in the manner and at the place and time and date specified
in such Pricing Agreement or at such other place and time and date as the
Representatives and the Company may agree upon in writing, such time and date
being herein called the "Time of Delivery" for such Securities.
5. The Company agrees with each of the Underwriters of any Designated
Securities:
(a) If the Company does not elect to rely on Rule 434 under the Act,
immediately following execution and delivery of the applicable Pricing
Agreement, to prepare the Prospectus as amended and supplemented in
relation to the applicable Designated Securities in a form approved by
the Representatives and to file such Prospectus as amended or
supplemented pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of the Pricing Agreement relating to the
applicable Designated Securities or, if applicable, such earlier time
as may be required by Rule 424(b), or if the Company elects to rely on
Rule 434 under the Act, immediately following execution and delivery of
the applicable Pricing Agreement, to prepare an abbreviated term sheet
relating to the Designated Securities in a form approved by the
Representatives that complies with the requirements of Rule 434 under
the Act and to file such form of Rule 434
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Prospectus complying with Rule 434(c)(2) of the Act pursuant to Rule
424(b) under the Act not later than the Commission's close of business
on the business day following the execution and delivery of the Pricing
Agreement relating to the applicable Designated Securities or, if
applicable, such earlier time as may be required by Rule 424(b); to
make no further amendment or any supplement to the Registration
Statement or Prospectus as amended or supplemented after the date of
the Pricing Agreement relating to such Designated Securities and prior
to the Time of Delivery for such Designated Securities which shall be
reasonably disapproved by the Representatives for such Designated
Securities promptly after reasonable notice thereof; to advise the
Representatives promptly of any such amendment or supplement after such
Time of Delivery and furnish the Representatives with copies thereof;
to file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for
so long as the delivery of a prospectus is required in connection with
the offering or sale of such Designated Securities, and during such
same period to advise the Representatives, promptly after it receives
notice thereof, of the time when any amendment to the Registration
Statement has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed with the
Commission, of the issuance by the Commission of any stop order or of
any order preventing or suspending the use of any Prospectus as amended
or supplemented, of the suspension of the qualification of such
Designated Securities for offering or sale in any jurisdiction, of the
initiation or threatening of any proceeding for any such purpose, or of
any request by the Commission for the amending or supplementing of the
Registration Statement or Prospectus as amended or supplemented or for
additional information; and, in the event of the issuance of any such
stop order or of any such order preventing or suspending the use of any
Prospectus as amended or supplemented relating to the Designated
Securities or suspending any such qualification, to use promptly its
best efforts to obtain its withdrawal;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Designated
Securities for offering and sale under the securities laws of such
jurisdictions as the Representatives may request and to comply with
such laws so as to permit the continuance of sales and dealings therein
in such jurisdictions for as long as may be necessary to complete the
distribution of such Designated Securities, provided that in connection
therewith the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction;
(c) Promptly to furnish to the Underwriters in New York City with
copies of the Prospectus, as amended or supplemented, in such
quantities as the Representatives may reasonably request, and, if the
delivery of a prospectus is required at any time in connection with the
offering or sale of the Designated Securities and if at such time any
event shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary in order to
9
make the statements therein, in the light of the circumstances under
which they were made when such Prospectus as amended or supplemented is
delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the Prospectus
or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Act, the
Exchange Act or the Trust Indenture Act, to notify the Representatives
and upon their request to file such document and to prepare and furnish
without charge to each Underwriter and to any dealer in securities as
many copies as the Representatives may from time to time reasonably
request of an amended Prospectus or a supplement to the Prospectus
which will correct such statement or omission or effect such
compliance;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule
158(c)), an earnings statement of the Company (which need not be
audited) complying with Section 11(a) of the Act and the rules and
regulations of the Commission thereunder (including at the option of
the Company Rule 158);
(e) During the period beginning on and including the date of the
Pricing Agreement for such Designated Securities and continuing through
and including the earlier of (i) the termination of trading
restrictions for such Designated Securities, as notified to the Company
by the Representatives and (ii) the Time of Delivery for such
Designated Securities, but in no event later than 90 days from the date
of the Pricing Agreement, not to offer, sell, contract to sell or
otherwise issue any debt securities of the Company which mature more
than one year after such Time of Delivery and which are substantially
similar to such Designated Securities, without the prior written
consent of the Representatives;
(f) To use the net proceeds received by it from the sale of the
Designated Securities in the manner specified in the Prospectus under
the caption "Use of Proceeds"; and
(g) To qualify as a "real estate investment trust" under the Code,
and to use its best efforts to continue to meet the requirements to
qualify as a "real estate investment trust."
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Securities under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto (including each abbreviated term sheet
delivered by the Company pursuant to Rule 434 under the Act) and the mailing and
delivering of copies thereof to the Underwriters and dealers; (ii) the cost of
printing or producing any Agreement Among Underwriters, this Agreement, any
Pricing Agreement, any Indenture, any blue sky and legal investment surveys and
any other documents in
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connection with the offering, purchase, sale and delivery of the Securities;
(iii) all expenses in connection with the qualification of the Securities for
offering and sale under state securities laws as provided in Section 5(b)
hereof, including the fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the blue sky and legal
investment surveys; (iv) any fees charged by securities rating services for
rating the Securities; (v) any filing fees incident to any required review by
the National Association of Securities Dealers, Inc. of the terms of the sale of
the Securities; (vi) the cost of preparing the Securities; (vii) the fees and
expenses of any Trustee and any agent of any Trustee and the fees and
disbursements of counsel for any Trustee in connection with any Indenture and
the Securities; and (viii) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section. It is understood, however, that, except as
provided in this Section, Section 8 and Section 11 hereof, the Underwriters will
pay all of their own costs and expenses, including the fees of their counsel,
transfer taxes on resale of any of the Securities by them, and any advertising
expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities
under the Pricing Agreement relating to such Designated Securities shall be
subject, in the discretion of the Representatives, to the condition that all
representations and warranties and other statements of the Company in, or
incorporated by reference from this Agreement into, the Pricing Agreement
relating to such Designated Securities are, at and as of the Time of Delivery
for such Designated Securities, true and correct, to the condition that the
Company shall have performed all of its obligations hereunder theretofore to be
performed, and to the following additional conditions:
(a) The Prospectus as amended or supplemented in relation to the
applicable Designated Securities shall have been or shall be filed with
the Commission pursuant to Rule 424(b) within the applicable time
period prescribed for such filing by the rules and regulations under
the Act and in accordance with Section 5(a) hereof; no stop order
suspending the effectiveness of the Registration Statement or any part
thereof shall have been issued and no proceeding for that purpose shall
have been initiated or threatened by the Commission; and all requests
for additional information on the part of the Commission shall have
been complied with to the Representatives' reasonable satisfaction;
(b) Sidley Austin Brown & Wood LLP, counsel for the Underwriters,
shall have furnished to the Representatives such opinion or opinions,
dated the Time of Delivery for such Designated Securities, with respect
to the organization of the Company, the validity of the Indenture, the
Registration Statement, the Prospectus as amended or supplemented and
other related matters as the Representatives may reasonably request,
and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters
(in rendering such opinion, Sidley Austin Brown & Wood LLP may rely, as
to all matters arising under or governed by the laws of the State of
Maryland, on the opinion of Shaw Pittman LLP);
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(c) Shaw Pittman LLP, counsel for the Company, shall have furnished
to the Representatives their written opinion, dated the Time of
Delivery for such Designated Securities, in substantially the form and
substance attached hereto as Schedule A.
(d) In addition to the above opinion, the Representatives shall have
received the opinion or opinions of Shaw Pittman LLP, Tax Counsel to
the Company, dated the Time of Delivery for such Designated Securities,
in form and substance satisfactory to the Representatives, to the
effect that (1) the Company qualified as a real estate investment trust
("REIT") under the Code for its taxable years ending through December
31, 2001, (2) the Company is organized in conformity with the
requirements for qualification as a REIT under the Code, and its
current method of operation will enable it to meet the requirements for
qualification as a REIT for the current taxable year and for future
taxable years; and (3) the discussion in (x) the Prospectus Supplement
dated November 14, 2002 under the caption "Certain Federal Income Tax
Considerations," and (y) the Company's Current Report on Form 8-K filed
with the Commission on November 13, 2002 (hereafter, the "Company's
Form 8-K") under the caption "Federal Income Tax Consequences" which is
incorporated by reference into the Prospectus Supplement, to the extent
that they discuss matters of law or legal conclusions or purport to
describe certain provisions of the federal tax laws, are correct
summaries of the matters discussed therein;
(e) On the date of the Pricing Agreement for such Designated
Securities and at the Time of Delivery for such Designated Securities,
Grant Thornton LLP, the independent accountants of the Company, shall
have furnished to the Underwriters a "comfort letter" in form and
substance satisfactory to the Representatives;
(f) On the date of the Pricing Agreement for such Designated
Securities and at the Time of Delivery for such Designated Securities
the Chief Executive Officer or Chief Operating Officer and the Chief
Financial Officer shall have furnished to the Representatives a
certificate substantially in the form of Annex II hereto;
(g) At the Time of Delivery for such Designated Securities, the
Designated Securities shall be rated at least Baa2 by Moody's
Investor's Service Inc. and BBB by Standard & Poor's Ratings Group, a
division of McGraw-Hill, Inc., and the Company shall have delivered to
the Representatives a letter dated the Time of Delivery, from each such
rating agency, or other evidence satisfactory to the Representatives,
confirming that the Designated Securities have such ratings;
(h) (i) Neither the Company nor any of the Entities shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended or
supplemented any loss or interference with its business from fire,
explosion, flood or other calamity,
12
whether or not covered by insurance, or from any labor dispute or court
or governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus as amended or supplemented, and (ii)
since the respective dates as of which information is given in the
Prospectus as amended or supplemented there shall not have been any
change in the authorized, issued and outstanding capital stock of the
Company or increase in long-term debt of the Company or any of the
Entities or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial
position, shareholders' equity or results of operations of the Company
and the Entities, otherwise than as set forth or contemplated in the
Prospectus as amended or supplemented, the effect of which, in any such
case described in clause (i) or (ii), is in the judgment of the
Representatives so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Designated Securities on the terms and in the manner contemplated in
the Prospectus as amended or supplemented;
(i) On or after the date of the Pricing Agreement relating to the
Designated Securities (i) no downgrading shall have occurred in the
rating accorded the Company's debt securities or preferred shares by
any "nationally recognized statistical rating organization", as that
term is defined by the Commission for purposes of Rule 436(g)(2) under
the Act and (ii) no such organization shall have publicly announced
that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities or
preferred shares;
(j) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the
following: (i) a material suspension or material limitation in trading
in securities generally on the NYSE; (ii) a suspension or material
limitation in trading in the Company's securities on the NYSE; (iii) a
general moratorium on commercial banking activities in New York
declared by either federal or New York State authorities or a material
disruption in commercial banking or securities settlement or clearance
services in the United States; or (iv) the outbreak or escalation of
hostilities involving the United States or the declaration by the
United States of a national emergency or war or other calamity or
crisis if the effect of any such event specified in this clause (iv) in
the judgment of the Representatives makes it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Designated Securities on the terms and in the manner contemplated in
the Prospectus as amended or supplemented;
(k) The Company shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of Prospectuses as amended
or supplemented; and
(l) The Company shall have furnished or caused to be furnished to
the Representatives at the Time of Delivery for the Designated
Securities a certificate or certificates of officers of the Company
dated such Time of Delivery as to the
13
accuracy of the representations and warranties of the Company herein at
and as of the date of such certificate, as to the performance by the
Company of all of its obligations hereunder to be performed at or prior
to the date of such certificate, as to the matters set forth in
subsections (a) and (h) of this Section and as to such other matters as
the Representatives may reasonably request.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several,
to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, any preliminary prospectus supplement, the
Registration Statement, the Prospectus as amended or supplemented and
any other prospectus relating to the Securities, or any amendment or
supplement thereto (including the information deemed to be a part of
the Registration Statement pursuant to Rule 434 under the Act, if
applicable), or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or
defending any such action or claim as such expenses are incurred;
provided, however, that the Company shall not be liable in any such
case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other
prospectus relating to the Securities, or any such amendment or
supplement in reliance upon and in conformity with written information
furnished to the Company by any Underwriter of Designated Securities
through the Representatives expressly for use in the Prospectus as
amended or supplemented relating to such Securities. Notwithstanding
the foregoing, the indemnification contained in this paragraph (a) with
respect to any Preliminary Prospectus shall not inure to the benefit of
any Underwriter to the extent that any such losses, claims, damages or
liabilities result from the fact that such Underwriter sold Designated
Securities to any person as to whom it shall be established that a copy
of the Prospectus as then amended or supplemented (excluding documents
incorporated therein by reference) was not delivered or sent to such
person within the time required by the Act and the rules and
regulations of the Commission thereunder and such losses, claims,
damages or liabilities of such Underwriter result from an untrue
statement or alleged untrue statement or omission or alleged omission
of a material fact contained in such Preliminary Prospectus which was
identified to such Underwriter and was corrected in the Prospectus
(excluding documents incorporated by reference), provided that the
Company has complied with Section 5(c) hereof.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company
may
14
become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus,
any preliminary prospectus supplement, the Registration Statement, the
Prospectus as amended or supplemented and any other prospectus relating
to the Securities, or any amendment or supplement thereto (including
the information deemed to be a part of the Registration Statement
pursuant to Rule 434 under the Act, if applicable), or arise out of or
are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in any Preliminary Prospectus,
any preliminary prospectus supplement, the Registration Statement, the
Prospectus as amended or supplemented and any other prospectus relating
to the Securities, or any such amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by
such Underwriter through the Representatives expressly for use therein;
and will reimburse the Company for any legal or other expenses
reasonably incurred by the Company in connection with investigating or
defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under such subsection, notify the
indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party shall not relieve it from
any liability which it may have to any indemnified party otherwise than
under such subsection. In case any such action shall be brought against
any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified party, be counsel to
the indemnifying party), and, after notice from the indemnifying party
to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified
party under such subsection for any legal expenses of other counsel
(unless separate counsel is required due to conflict of interest) or
any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without
written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to,
any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not
the indemnified party is an actual or potential party to such action or
claim) unless such settlement, compromises or judgment (i) includes an
unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include
15
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 the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party
under subsection (a) or (b) above in respect of any losses, claims
damages or liabilities (or actions in respect thereof) referred to
therein, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters of the Designated
Securities on the other from the offering of the Designated Securities
to which such loss, claim, damage or liability (or action in respect
thereof) relates. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if
the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the Company on the one hand and the
Underwriters of the Designated Securities on the other in connection
with the statements or omissions which resulted in such losses, claims,
damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received
by the Company on the one hand and such Underwriters on the other shall
be deemed to be in the same proportion as the total net proceeds from
such offering (before deducting expenses) received by the Company bear
to the total underwriting discounts and commissions received by such
Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact contained in any Registration Statement, the Prospectus or any
amendment or supplement thereto relates to information supplied by the
Company on the one hand or such Underwriters on the other and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The
Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subsection (d) 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 subsection (d). The amount paid or payable by
an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this
subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding
the provisions of this subsection (d), no Underwriter shall be required
to contribute any amount in excess of the amount by which the total
price at which the applicable Designated 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 such untrue or alleged untrue statement or
omission or alleged
16
omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent
misrepresentation. The obligations of the Underwriters of Designated
Securities in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations with respect to
such Securities and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and
shall extend, upon the same terms and conditions, to each person, if
any, who controls any Underwriter within the meaning of the Act; and
the obligations of the Underwriters under this Section 8 shall be in
addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to
each officer and trustee of the Company and to each person, if any, who
controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Designated Securities which it has agreed to purchase at
the Time of Delivery under the Pricing Agreement relating to such
Designated Securities, the Representatives may in their discretion
arrange for themselves or another party or other parties to purchase
such Designated Securities on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the
Representatives do not arrange for the purchase of such Designated
Securities, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties
satisfactory to the Representatives to purchase such Designated
Securities on such terms. In the event that, within the respective
prescribed period, the Representatives notify the Company that they
have so arranged for the purchase of such Designated Securities, or the
Company notifies the Representatives that it has so arranged for the
purchase of such Designated Securities, the Representatives or the
Company shall have the right to postpone the time of Delivery for such
Designated Securities for a period of not more than seven days, in
order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus as amended or supplemented, or
in any other documents or arrangements, and the Company agrees to file
promptly any amendments or supplements to the Registration Statement or
the Prospectus which in the opinion of the Representatives may thereby
be made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with like
effect as if such person had originally been a party to the Pricing
Agreement with respect to such Designated Securities.
(b) If, after giving effect to any arrangements for the purchase of
the Designated Securities of a defaulting Underwriter or Underwriters
by the Representatives and the Company as provided in subsection (a)
above, the aggregate principal amount of such Designated Securities
which remains unpurchased does not exceed one-tenth of the aggregate
principal amount of the Designated Securities to be purchased at the
Time of Delivery, then the Company
17
shall have the right to require each non-defaulting Underwriter to
purchase the principal amount of Designated Securities which such
Underwriter agreed to purchase at the Time of Delivery under the
Pricing Agreement relating to such Designated Securities and, in
addition, to require each non-defaulting Underwriter to purchase its
pro rata share (based on the principal amount of Designated Securities
which such Underwriter agreed to purchase under such Pricing Agreement)
of the Designated Securities of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability
for its default.
(c) If, after giving effect to any arrangements for the purchase of
the Designated Securities of a defaulting Underwriter or Underwriters
by the Representatives and the Company as provided in subsection (a)
above, the aggregate principal amount of Designated Securities which
remains unpurchased exceeds one-tenth of the aggregate principal amount
of the Designated Securities to be purchased at the Time of Delivery,
as referred to in subsection (b) above, or if the Company shall not
exercise the right described in subsection (b) above to require
non-defaulting Underwriters to purchase Designated Securities of a
defaulting Underwriter or Underwriters, then, in the case of a failure
to purchase Designated Securities at the Time of Delivery, the Pricing
Agreement relating to such Designated Securities shall thereupon
terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the
Company and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its
default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or trustee or controlling person of the Company, and shall
survive delivery of and payment for the Securities.
11. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, the Company shall not then be under any liability to any Underwriter
with respect to the Designated Securities covered by such Pricing Agreement
except as provided in Section 6 and Section 8 hereof. If this Agreement shall be
terminated as a result of any of the conditions set forth in Section 7 hereof
(other than Section 7(j)(i), (iii) or (iv)) not being satisfied the Company will
reimburse the Underwriters through the Representatives for all out-of-pocket
expenses approved in writing by the Representatives, including reasonable fees
and disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of such Designated Securities,
but the Company shall then be under no further liability to any Underwriter with
respect to such Designated Securities except as provided in Section 6 and
Section 8 hereof.
18
12. In all dealings hereunder, the Representatives of the Underwriters
of Designated Securities shall act on behalf of each of such Underwriters, and
the parties hereto shall be entitled to act and rely upon any statement,
request, notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail,
overnight courier, hand delivery or facsimile transmission to the address of the
Representatives as set forth in the applicable Pricing Agreement; and if to the
Company shall be delivered or sent by mail, overnight courier, hand delivery or
facsimile transmission to the address of the Company set forth in the
Registration Statement: Attention: Legal Department; provided, however, that any
notice to an Underwriter pursuant to Section 8(c) hereof shall also be delivered
or sent by mail, overnight courier, hand delivery or facsimile transmission to
such Underwriter at its address set forth in its Underwriters' Questionnaire, or
telex or facsimile transmission constituting such Questionnaire, which address
will be supplied to the Company by the Representatives upon request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement and each Pricing Agreement shall be binding upon,
and inure solely to the benefit of, the Underwriters, the Company and, to the
extent provided in Section 8 and Section 10 hereof, the officers and trustees of
the Company and each person who controls the Company or any Underwriter, and
their respective heirs, executors, administrators, successors and assigns, and
no other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing, Agreement. No purchaser of any of the Securities
from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used
herein, "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. This Agreement and each Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
16. This Agreement and each Pricing Agreement may be executed by any
one or more of the parties hereto and thereto in any number of counterparts,
each of which shall be deemed to be an original, but all such respective
counterparts shall together constitute one and the same instrument.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
19
If the foregoing is in accordance with your understanding, please sign
and return this Agreement to us.
Very truly yours,
FEDERAL REALTY INVESTMENT TRUST
By:
-----------------------------
Name:
Title:
Accepted as of the date hereof:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
SALOMON SMITH BARNEY INC.
WACHOVIA SECURITIES, INC.
COMMERZBANK CAPITAL MARKETS CORP.
BANC OF AMERICA SECURITIES LLC
BMO NESBITT BURNS CORP.
FLEET SECURITIES, INC.
HVB CAPITAL MARKETS, INC.
WELLS FARGO BROKERAGE SERVICES, LLC
PNC CAPITAL MARKETS, INC.
By: Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By:
-----------------------------------
Name:
Title:
20
SCHEDULE A
(i) The Company is a real estate investment trust validly existing
and in good standing (as of the date of the applicable good standing
certificate referred to in such opinion) under the laws of the State of
Maryland and has the trust power and trust authority under Title 8 of
the Corporations and Associations Article of the Annotated Code of
Maryland (the "Maryland REIT Law"), its Declaration of Trust and its
Bylaws to own its current properties and to conduct its business as
described in the Prospectus as amended and supplemented in relation to
the Designated Securities. The Company is registered, qualified or
authorized to transact business as a foreign entity in the respective
states specified in such opinion as of the respective dates listed
therein;
(ii) Street Retail, Inc., a Maryland corporation ("SRI"), is validly
existing and in good standing (as of the date of the applicable good
standing certificate specified in such opinion) under the laws of the
State of Maryland and has the corporate power and corporate authority
under the Maryland General Corporation Law, the SRI Articles and the
SRI Bylaws to own its current properties and to conduct its business as
described in the Prospectus as amended and supplemented in relation to
the Designated Securities.
(iii) The Agreement and the Pricing Agreement with respect to the
Designated Securities have been duly authorized, executed and delivered
by the Company;
(iv) The Designated Securities have been duly authorized for
issuance and sale to the Underwriters pursuant to the Agreement and the
Pricing Agreement and, when issued and authenticated in the manner
provided for in the Indenture and delivered against payment therefor in
accordance with the provisions of the Agreement and such Pricing
Agreement, will constitute valid and legally binding obligations of the
Company, entitled to the benefits of the Indenture, enforceable against
the Company in accordance with their terms;
(v) The Indenture has been duly authorized, executed and delivered
by the Company and, assuming due authorization, execution and delivery
by each other party thereto, constitutes a valid and binding agreement
of the Company, enforceable against the Company in accordance with its
terms;
(vi) The Indenture has been duly qualified under the Trust Indenture
Act;
(vii) The Designated Securities and the Indenture conform in all
material respects to the descriptions thereof in the Prospectus as
amended or supplemented;
(viii) The Registration Statement has been declared effective under
the Act; the required filing of the Prospectus as amended and
supplemented in relation to the applicable Designated Securities
pursuant to Rule 424(b) has been made in the manner and within the time
period required by Rule 424(b); and, to the best of such counsel's
knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued under the Act and no proceeding
for that purpose has been instituted or is pending or threatened by the
Commission. The Company meets the requirements for use of Form S-3 with
respect to the issuance and sale of the Designated Securities;
(ix) The execution, delivery and performance as of the date of such
opinion by the Company of the Agreement and the Pricing Agreement with
respect to the Designated Securities and the issuance and sale of the
Designated Securities being issued on the date of such opinion do not
(i) violate the Maryland REIT Law, (ii) violate the Company's
Declaration of Trust or Bylaws, (iii) to such counsel's knowledge,
violate any applicable law, rule, regulation, order, judgment or decree
of any Maryland agency or court, or (iv) breach or constitute a default
under the agreements listed in Schedule A-1 to the Agreement (other
than with respect to the compliance by the Company with the financial
and numerical covenants contained therein, as to which such counsel
need express no opinion);
(x) The Registration Statement and the Prospectus, excluding the
documents incorporated by reference therein, and each amendment or
supplement to the Registration Statement and Prospectus, excluding the
documents incorporated by reference therein, as of their respective
effective or issue dates (other than the financial statements and
supporting schedules included therein or omitted therefrom, and the
Trustee's Statement of Eligibility on Form T-1, as to which such
counsel need express no opinion), complied as to form in all material
respects with the requirements of the Act and the rules and regulations
of the Commission thereunder; if applicable, the Rule 434 Prospectus
complies as to form in all material respects with the requirements of
Rule 434 under the Act;
(xi) The documents incorporated by reference in the Prospectus as
amended and supplemented in relation to the applicable Designated
Securities (other than the financial statements and supporting
schedules included therein or omitted therefrom, as to which such
counsel need express no opinion), when they became effective or were
filed with the Commission, as the case may be, complied as to form in
all material respects with the requirements of the Act or the Exchange
Act, as
22
applicable, and the rules and regulations of the Commission thereunder;
and
(xii) Except for such consents, approvals, authorizations,
registrations or qualifications as have been obtained under the Act and
the Trust Indenture Act, and except for consents, approvals,
authorizations, registrations or qualifications as may be required
under applicable state securities or real estate syndication laws (as
to which such counsel need express no opinion) in connection with the
offer and sale of the Designated Securities, no consent, approval,
authorization or order of, or filing or registration with, the
Commission or any Maryland court or governmental agency or body is
required to be obtained or made by the Company for the issuance of the
Designated Securities or the performance as of the date of such opinion
of the obligations contained in the Designated Securities and in the
Agreement and the Pricing Agreement by the Company;
The opinion of Shaw Pittman LLP shall also state that on the basis
of its activities as counsel to the Company in connection with the
Registration Statement and the Prospectus that no facts have come to
such counsel's attention which have caused them to believe that (i) the
Registration Statement or any amendments thereto, as of their
respective effective dates, 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, (ii) the
Prospectus as amended and supplemented, or any further amendments or
supplements thereto, as of their respective issue dates or as of the
date of such opinion, 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, or (iii) there are any
legal or governmental proceedings pending or threatened against the
Company or any of its subsidiaries that are required to be disclosed in
the Registration Statement or the Prospectus as amended and
supplemented, other than those disclosed therein; provided that in
making the foregoing statements (which shall not constitute an
opinion), such counsel need not express any view as to the financial
statements and supporting schedules and other financial information and
data included in or omitted from the Registration Statement or the
Prospectus as amended and supplemented;
Qualifications to the Opinion:
o In rendering such opinions, counsel may rely as to matters of fact on
representations of the Company made in the Agreement and the Pricing
Agreement, certificates of responsible officers of the Company and public
officials.
23
o The enforceability of the documents referred to in the opinion may be
limited by applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium, voidable preference, rearrangement,
liquidation, conservatorship or other similar laws relating to, or
affecting the enforcement of, creditors' rights and remedies generally,
now or hereafter in effect.
o The enforceability of any or all of the provisions of the documents
referred to in the opinion is subject to such laws, legal and equitable
principles, principles of commercial reasonableness, good faith and fair
dealing (regardless of whether enforcement is sought in a proceeding at
law or in equity), principles of public policy, statutory provisions,
procedural requirements and/or exercise of judicial discretion as may
limit the specific enforcement or existence of certain rights or remedies
of the party seeking to enforce them.
o The enforceability of any or all of the provisions of the documents
referred to in the opinion may be limited to the extent that (i) remedies
are sought with respect to a breach that a court concludes is not material
or does not adversely affect the party seeking to enforce the provision or
provisions of such documents, or (ii) a court concludes that it would be
unreasonable or unconscionable to enforce such documents.
o Counsel need not express any opinion as to the validity or enforceability
of (i) the indemnification and contribution provisions of the documents
referred to in the opinion, to the extent that the validity or
enforceability of such provisions may be limited by the federal securities
laws, (ii) the severability provisions contained in such documents, or
(iii) the choice-of-law provisions contained in such documents as to which
laws shall be deemed to govern. The validity or enforceability of such
documents may also be limited by the exercise of judicial discretion
regarding the entitlement to attorneys' fees and other costs.
o Such counsel's opinions shall be based upon and are limited to the
relevant laws of the United States of America, the Maryland REIT Law and
the Maryland General Corporation Law, in each case excluding the choice of
law provisions thereof, except that the opinions rendered in paragraphs
(iv) and (v) above, to the extent that they address enforceability of the
documents referred to therein or the effect of New York law, are also
based upon and are limited to the laws of the State of New York, excluding
the choice of law provisions thereof. Such counsel need not render any
opinion with respect to the law of any other jurisdiction or any opinion
as to whether a federal or state court outside of the State of New York
would give effect to the choice of New York law provisions in such
documents.
o Such counsel's opinions as to the qualification and good standing of the
Company or SRI may be based solely upon good standing certificates with
24
respect to such entities issued by the applicable state regulatory
authority or authorities, and may be rendered as of the date of the
applicable certificate.
o Any references herein to our knowledge or words of similar effect shall
mean that, in the course of our representation of the Company, no
information has come to the attention of our attorneys who have performed
substantive legal services in connection with this transaction that gives
such attorneys actual current knowledge that any such opinions are not
accurate. In rendering the opinion, we have not undertaken any independent
investigation relating to such matters or communicated the details of this
transaction to all of our attorneys who may have performed services for
the Company or any other person or entity.
o Except as agreed by counsel in writing, the opinion shall be solely for
the benefit of the addressees thereof and may be relied upon solely by
such addressees for the purposes for which it is being furnished.
Notwithstanding the foregoing, Sidley Austin Brown & Wood LLP, counsel to
the Underwriters, may rely on the opinion as to all matters of the
Maryland REIT Law and the Maryland General Corporation Law. Without
counsel's express permission, the opinion letter may not be used,
circulated, quoted or otherwise referred to for any purpose except as
stated therein.
25
SCHEDULE A-1
Indenture dated December 13, 1993, related to the Company's 7.48%
Debentures due August 15, 2026; 8 7/8% Senior Notes due January 15, 2000;
8% Notes due April 21, 2002; 6 5/8% Notes due 2005; 6.82% Medium Term
Notes due August 1, 2027; 6.74% Medium Term Notes due March 10, 2004; and
6.99% Medium Term Notes due March 10, 2006, filed with the Commission on
December 13, 1993 as Exhibit 4(a) to the Company's Registration Statement
on Form S-3 (File No. 33-51029).
Indenture dated September 1, 1998 related to the Company's 8.75% Notes due
December 1, 2009 filed as Exhibit 4(a) to the Company's Registration
Statement on Form S-3 (File No. 333-63619).
Credit Agreement Dated as of December 19, 1997, and as subsequently
amended, by and among the Company, as Borrower, The Financial Institutions
Party Thereto and Their Assignees Under Section 13.5.(a), as Lenders,
Corestates Bank, N.A., as Syndication Agent, First Union National Bank, as
Administrative Agent and as Arranger, and Wells Fargo Bank, as
Documentation Agent and as Co-Arranger.
Term Loan Agreement, dated as of December 22, 1998, and as subsequently
amended, by and among the Company, as Borrower, the Financial Institutions
Party Thereto and Their Assignees Under Section 13.5.(d), as Lenders,
Commerzbank Aktiengesellschaft, New York Branch as Syndication Agent, PNC,
National Association, as Administrative Agent and Fleet National Bank, as
documentation agent.
Building Loan Agreement, dated as of April 17, 2001, and as subsequently
amended, by and among FRIT San Jose Town and Country Village LLC, San Jose
Residential, Inc. and SRI jointly and severally as Borrower, Commerzbank
AG, New York Branch, Fleet National Bank, Bayerische Hypo-Und Vereinsbank
AG, New York Branch and the Other Lenders named therein.
ANNEX I
Pricing Agreement
[o], 2002
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
SALOMON SMITH BARNEY INC.
WACHOVIA SECURITIES, INC.
COMMERZBANK CAPITAL MARKETS CORP.
BANC OF AMERICA SECURITIES LLC
BMO NESBITT BURNS CORP.
FLEET SECURITIES, INC.
HVB CAPITAL MARKETS, INC.
WELLS FARGO BROKERAGE SERVICES, LLC
PNC CAPITAL MARKETS, INC.
c/o Merrill Lynch, Pierce, Fenner & Smith
Incorporated
4 World Financial Center
New York, New York 10080
Ladies and Gentlemen:
Federal Realty Investment Trust, a Maryland real estate investment
trust (the "Company"), proposes, subject to the terms and conditions stated
herein and in the Underwriting Agreement, dated November [o], 2002 (the
"Underwriting Agreement"), between the Company on the one hand and Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Salomon Smith Barney Inc., Wachovia
Securities, Inc., Commerzbank Capital Markets Corp., Banc of America Securities
LLC, BMO Nesbitt Burns Corp., Fleet Securities, Inc., HVB Capital Markets, Inc.,
Wells Fargo Brokerage Services, LLC and PNC Capital Markets, Inc. on the other
hand, to issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") the Securities specified in Schedules II hereto (the "Designated
Securities"). Each of the provisions of the Underwriting Agreement is
incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Pricing Agreement to the same extent as if such provisions had been
set forth in full herein; and each of the representations and warranties set
forth therein shall be deemed to have been made at and as of the date of this
Pricing Agreement, except that each representation and warranty which refers to
the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be
a representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Securities which are the
subject of this Pricing Agreement. Each reference to the Representatives herein
and in the provisions of the Underwriting Agreement so incorporated by reference
shall
be deemed to refer to you. Unless otherwise defined herein, terms defined in the
Underwriting Agreement are used herein as therein defined. The Representative
designated to act on behalf of the Representatives pursuant to Section 12 of the
Underwriting Agreement is Merrill Lynch, Pierce, Fenner & Smith Incorporated,
and the Representatives designated to act on behalf of each of the Underwriters
of the Designated Securities pursuant to Section 12 of the Underwriting
Agreement and the address of the Representatives referred to in such Section 12
are set forth in Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you, is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the Time of Delivery
and place and at the purchase price to the Underwriters set forth in Schedule II
hereto, the principal amount of Designated Securities (as defined in Schedule II
hereto) set forth opposite the name of such Underwriter in Schedule I hereto.
The obligations of the Underwriters under this Pricing Agreement and
the Underwriting Agreement incorporated herein are several and not joint.
This Pricing Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
2
If the foregoing is in accordance with your understanding, please sign
and return this Pricing Agreement to us, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this Pricing Agreement and such acceptance
hereof, including the provisions of the Underwriting Agreement incorporated
herein by reference, shall constitute a binding agreement between each of the
Underwriters and the Company.
Very truly yours,
FEDERAL REALTY INVESTMENT TRUST
By:
-----------------------------------------
Name:
Title:
Accepted as of the date hereof:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
SALOMON SMITH BARNEY INC.
WACHOVIA SECURITIES, INC.
COMMERZBANK CAPITAL MARKETS CORP.
BANC OF AMERICA SECURITIES LLC
BMO NESBITT BURNS CORP.
FLEET SECURITIES, INC.
HVB CAPITAL MARKETS, INC.
WELLS FARGO BROKERAGE SERVICES, LLC
PNC CAPITAL MARKETS, INC.
By: Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By:
------------------------------------
Name:
Title:
3
SCHEDULE I
Principal Amount of
Underwriter Designated Securities
----------- ---------------------
Merrill Lynch, Pierce, Fenner & Smith
Incorporated $ XX,XXX,XXX
Salomon Smith Barney Inc. XX,XXX,XXX
Wachovia Securities, Inc. XX,XXX,XXX
Commerzbank Capital Markets Corp. XX,XXX,XXX
Banc of America Securities LLC XX,XXX,XXX
BMO Nesbitt Burns Corp. XX,XXX,XXX
Fleet Securities, Inc. XX,XXX,XXX
HVB Capital Markets, Inc. XX,XXX,XXX
Wells Fargo Brokerage Services, LLC XX,XXX,XXX
PNC Capital Markets, Inc. --------------
Total $ 150,000,000
===========
SCHEDULE II
Title of Designated Securities:
[o]% Notes due November [o], 20[o]
Aggregate principal amount:
$[o]
Price to Public:
% of the principal amount of the Designated Securities, plus
accrued interest from November [o], 2002 to November [o], 2002
Purchase Price by Underwriters:
[o]% of the principal amount of the Designated Securities, plus accrued
interest from November [o], 2002 to November [o], 2002
Specified funds for payment of purchase price:
Wire transfer of immediately available funds
Indenture:
Indenture dated as of September 1, 1998, between the Company and
Wachovia Bank, National Association (formerly, First Union National
Bank), as Trustee
Maturity:
[o], 20[o]
Interest Rate:
[o]%
Interest Payment Dates:
[o] and [o], commencing [o], 2003
Redemption Provisions:
The Designated Securities may be redeemed at any time, in whole or in
part, at a redemption price as described in the Prospectus Supplement
Sinking Fund Provisions:
None
Defeasance provisions:
The defeasance and covenant defeasance provisions of the Indenture
apply to the Designated Securities
Time of Delivery:
November [o], 2002
Closing Location:
Sidley Austin Brown & Wood LLP
787 Seventh Avenue
New York, New York 10019
Names and addresses of Representatives:
Designated Representatives:
Merrill Lynch, Pierce, Fenner & Smith, Incorporated, Salomon Smith
Barney Inc., Wachovia Securities, Inc., Commerzbank Capital Markets
Corp., Banc of America Securities LLC, BMO Nesbitt Burns Corp., Fleet
Securities, Inc., HVB Capital Markets, Inc., Wells Fargo Brokerage
Services, LLC and PNC Capital Markets, Inc.
Address for Notices, etc.:
c/o Merrill Lynch, Pierce, Fenner & Smith
Incorporated
4 World Financial Center
New York, New York 10080
Attn: [[o]]
[Other Terms]*:
- -----------
*A description of particular tax, accounting or other unusual features
(such as the addition of event risk provisions) of the Securities should be set
forth, or referenced to an attached and accompanying description, if necessary
to ensure agreement as to the terms of the Securities to be purchased and sold.
Such a description might appropriately be in the form in which such features
will be described in the Prospectus Supplement for the offering.
2
ANNEX II
CERTIFICATE OF THE CHIEF EXECUTIVE OFFICER
AND CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 7(f) OF THE UNDERWRITING AGREEMENT
I, Steven J. Guttman, the Chairman, Chief Executive Officer and
Trustee, and I, Larry E. Finger, the Senior Vice President and Chief Financial
Officer, of Federal Realty Investment Trust, certify that:
1. the Annual Report on Form 10-K for the year ended December 31, 2001,
and Quarterly Reports on Form 10-Q for the fiscal quarters ended
March 31, 2002, June 30, 2002 and September 30, 2002 (collectively,
the "Reports"), fully comply with the requirements of Section 13(a)
or 15(d) of the Securities and Exchange Act of 1934; and
2. the information contained in each Report fairly presents, in all
material respects, the financial condition and results of operations
of Federal Realty Investment Trust as of its date of filing with the
Securities and Exchange Commission.
November ____, 2002
------------------------------
Steven J. Guttman
Chairman, Chief Executive Officer
and Trustee
------------------------------
Larry E. Finger
Senior Vice President and Chief
Financial Officer
ANNEX III
Company's Direct or Indirect
FEDERAL REALTY INVESTMENT TRUST Ownership Interest
- ------------------------------- ------------------
FR Associates Limited Partnership ("FR") 99%
Andorra Associates 99% (1% FR)
Governor Plaza Associates 99% (1% FR)
Shopping Center Associates 99% (1% FR)
Berman Enterprises II Limited Partnership 99% (1% FR)
FRIT Escondido Promenade, LLC 70%
FRIT Leasing & Development Services, Inc. 100% voting stock
Congressional Plaza Associates 55.7065%
FR Pike 7 Limited Partnership (DownREIT) 99%
Federal Realty Partners L. P. (Master DownREIT- 476,669 units outstanding - 264,952 40 units (FedRP Inc.)
units have been redeemed) 40 units (FRLP Inc.)
Federal Realty Partners, Inc. 100% voting stock
Loehmann's Plaza Limited Partnership (DownREIT - 250,000 units outstanding) 60,000 units (FedRP Inc.)
FRLP, Inc. 100% voting stock
FR Leesburg Plaza, LLC 100%
FR Leesburg Plaza, LP (DownREIT-352,500 total units issued - 7,816 units have 214,500 units (LLC)
been redeemed)
FRIT Property Services, Inc. (f/k/a Terranomics Retail Services, Inc. f/k/a TRS 100% nonvoting stock
Acquisition, Inc.)
Ravenswood Development Services, Inc. 100% nonvoting stock
Federal Realty Management Services, Inc. 100% voting stock
FR Federal Plaza, Inc. 100% voting stock
FR Federal Plaza, LLC 100% (FedPlaza Inc.)
Street Retail, Inc. 100% voting stock
STREET RETAIL, INC. ("SRI")
- ---------------------------
SRI Old Town, LLC 100%
Street Retail Forest Hills I, LLC 100%
Street Retail Forest Hills II, LLC 100%
Street Retail Tempe I, LLC 85%
Street Retail West GP, Inc. ("SRWGP") 100% voting stock
Street Retail West I, L.P. 90% (10% SRI)
Street Retail West II, L.P. 90% (10% SRI)
Street Retail West 3, L.P. 90% (10% SRI)
Street Retail West 4, L.P. 90%
Street Retail West 6, L.P. 90%
Street Retail West 7, L.P. 90%
Street Retail West 10, L.P. 90%
Street Retail San Antonio, LP .1% (SRI San Anton)
99.9% (SRI Texas)
SRI San Antonio, Inc. (f/k/a Dim Sum, Inc. 100% voting stock
f/k/a FR Acquisition Holding Co., Inc.)
SRI Texas, Inc. 100% voting stock
JS&DB, Inc. 100% voting stock
SRI Holding Company, Inc. 100% nonvoting stock
Street Retail West 9, L.P. 90% (SRI Holding)
FRIT San Jose Town and Country Village, LLC 100%
San Jose Residential, Inc. 100% nonvoting stock (LLC)
Santana Row Services, Inc. 100% voting
Santana Row ROF, Inc. 100% voting
La Rive Gauche San Jose, LLC 37.5%
Straits Santana Row, LLC 90%
Blowfish SR, LLC 30%
Village Cafe Santana Row, LLC 49%
Yankee Pier Santana Row, LLC 75%
Pizza Antica, LLC 20%
Santana Row Association, a California non-profit mutual benefit corporation
2