SALES AGENCY FINANCING AGREEMENT
Exhibit 1.2
Execution Version
THIS SALES AGENCY FINANCING AGREEMENT (this “Agreement”), dated as of February 3,
2011, among EQUITY RESIDENTIAL, a Maryland real estate investment trust (“EQR”), ERP
OPERATING LIMITED PARTNERSHIP, an Illinois limited partnership (“ERP”, and together with
EQR, the “Transaction Entities”), and BNY MELLON CAPITAL MARKETS, LLC (“BNYMCM”).
W I T N E S S E T H:
WHEREAS, EQR previously has authorized the issuance and sale of up to 17,000,000 Common Shares
(as defined herein) (the “Original Program Amount”) pursuant to those certain Sales Agency
Financing Agreements, each dated September 28, 2009 (the “Original Sales Agency
Agreements”), by and among the Transaction Entities and each of Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated, X.X. Xxxxxx Securities LLC and Xxxxxx Xxxxxxx & Co. Incorporated, as sales
agents (each, an “Alternative Sales Agent” and, collectively, the “Alternative Sales
Agents”);
WHEREAS, EQR has issued and sold an aggregate of 12,687,478 Common Shares pursuant to the
Original Sales Agency Agreements;
WHEREAS, EQR has authorized an increase in the Original Program Amount and now proposes to
issue and sell in the manner contemplated by this Agreement up to 10,000,000 Common Shares,
including the 4,312,522 Common Shares remaining unsold under the Original Sales Agency Agreements
(the “Maximum Program Amount”), upon the terms and subject to the conditions contained
herein;
WHEREAS, BNYMCM has been appointed by EQR as its agent to sell the Program Shares (as defined
herein) and agrees to use its commercially reasonable efforts to sell the Program Shares offered by
EQR upon the terms and subject to the conditions contained herein; and
WHEREAS, concurrently with the execution hereof, the Transaction Entities are also amending
and restating the Original Sales Agency Agreements by entering into amended and restated sales
agency financing agreements, dated as of even date herewith (each, an “Alternative Sales Agency
Agreement”), with each of the Alternative Sales Agents for the issuance and sale from time to
time through the Alternative Sales Agents of Program Shares on the terms set forth in the
Alternative Sales Agency Agreements. This Agreement and the Alternative Sales Agency Agreements
are collectively referred to herein as the “Sales Agency Agreements.” The aggregate number
of Program Shares to be issued and sold pursuant to the Sales Agency Agreements shall not exceed
the Maximum Program Amount.
NOW THEREFORE, in consideration of the premises, representations, warranties, covenants and
agreements contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, intending to be legally bound hereby, the parties
hereto agree as follows:
ARTICLE I
DEFINITIONS
DEFINITIONS
Section 1.01 Certain Definitions. For purposes of this Agreement, capitalized terms
used herein and not otherwise defined shall have the following respective meanings:
“Actual Sold Amount” means the number of Issuance Shares that BNYMCM has sold during
the Selling Period.
“Affiliate” of a Person means another Person that directly or indirectly, through one
or more intermediaries, controls, is controlled by, or is under common control with, such first-
mentioned Person. The term “control” (including the terms “controlling,” “controlled by” and
“under common control with”) means the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of a Person, whether through the ownership of
voting securities, by contract or otherwise.
“Agreement” has the meaning set forth in the Preamble.
“Alternative Sales Agency Agreements” has the meaning set forth in the Recitals.
“Alternative Sales Agent(s)” has the meaning set forth in the Recitals.
“Applicable Time” means the time of sale of any Program Shares pursuant to this
Agreement.
“Average Daily Trading Volume” shall have the definition given for “ADTV” in
Regulation M promulgated by the Commission and as in effect on the date hereof.
“Base Prospectus” has the meaning set forth in Section 3.01.
“BNYMCM” has the meaning set forth in the Preamble.
“Closing” has the meaning set forth in Section 2.02.
“Closing Date” means the date on which the Closing occurs.
“Code” means the Internal Revenue Code of 1986, as amended.
“Comfort Letter Request Date” has the meaning set forth in Section 4.08.
“Commission” means the United States Securities and Exchange Commission.
“Commitment Period” means the period commencing on the date of this Agreement and
expiring on the earliest to occur of (x) the date on which BNYMCM and the Alternative Sales Agents
in the aggregate shall have sold the Maximum Program Amount pursuant to the Sales
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Agency Agreements, (y) the date this Agreement is terminated pursuant to Article VII and (z)
the third anniversary of the date of this Agreement.
“Common Shares” shall mean EQR’s common shares of beneficial interest, par value $.01
per share.
“Environmental Laws” has the meaning set forth in Section 3.33.
“EQR” has the meaning set forth in the Preamble.
“ERP” has the meaning set forth in the Preamble.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Exchange Act Regulations” has the meaning set forth in Section 3.25.
“FCPA” has the meaning set forth in Section 3.42.
“Floor Price” means the minimum price per share set by EQR in the Issuance Notice
below which BNYMCM shall not sell Program Shares during the Selling Period, which may be adjusted
by EQR at any time during the Selling Period and which in no event shall be less than $1.00.
“GAAP” has the meaning set forth in Section 3.08.
“General Disclosure Package” has the meaning set forth in Section 3.02.
“Government License” has the meaning set forth in Section 3.24.
“Hazardous Materials” has the meaning set forth in Section 3.33.
“Issuance Supplement” has the meaning set forth in Section 3.01.
“Issuer Free Writing Prospectus” has the meaning set forth in Section 3.05.
“Issuance” means each occasion EQR elects to exercise its right to deliver an Issuance
Notice requiring BNYMCM to use its commercially reasonable efforts to sell Program Shares as
specified in such Issuance Notice, subject to the terms and conditions of this Agreement.
“Issuance Amount” means the number of Issuance Shares to be sold by BNYMCM with
respect to any Issuance.
“Issuance Date” means any Trading Day during the Commitment Period that an Issuance
Notice is deemed delivered pursuant to Section 2.03(b) hereof.
“Issuance Notice” means a written notice to BNYMCM delivered in accordance with this
Agreement in the form attached hereto as Exhibit A.
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“Issuance Price” means the Sales Price less the Selling Commission.
“Issuance Shares” means all Program Shares issued or issuable pursuant to an Issuance
that has occurred or may occur in accordance with the terms and conditions of this Agreement.
“Issuance Supplement” has the meaning set forth in Section 3.01.
“Material Adverse Effect” means a material adverse effect on the financial condition
or in the earnings, assets, business affairs or business prospects of the Transaction Entities and
their subsidiaries, considered as a single enterprise, whether or not arising in the ordinary
course of business, or any material adverse effect on the Transaction Entities’ ability to
consummate the transactions contemplated by, or to execute, deliver and perform their obligations
under, this Agreement.
“Maximum Program Amount” has the meaning set forth in the Recitals.
“Money Laundering Laws” has the meaning set forth in Section 3.41.
“OFAC” has the meaning set forth in Section 3.43.
“Officer’s Certificate Request Date” has the meaning set forth in Section 4.09.
“Opinion Request Date” has the meaning set forth in Section 4.07.
“Original Program Amount” has the meaning set forth in the Recitals.
“Original Sales Agency Agreements” has the meaning set forth in the Recitals.
“Person” means an individual or a corporation, partnership, limited liability company,
trust, incorporated or unincorporated association, joint venture, joint stock company, governmental
authority or other entity of any kind.
“Principal Market” means the New York Stock Exchange.
“Program Shares” means Common Shares issued or issuable pursuant to the Sales Agency
Agreements.
“Prospectus” has the meaning set forth in Section 3.01.
“Prospectus Supplement” has the meaning set forth in Section 5.01(k).
“Registration Statement” has the meaning set forth in Section 3.01.
“Registration Statement Amendment Date” has the meaning set forth in Section 4.07.
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“Renewal Deadline” has the meaning set forth in Section 4.01.
“Representation Date” has the meaning set forth in the preamble to Article III.
“Request Date” means each Comfort Letter Request Date, each Officer’s Certificate
Request Date and each Opinion Request Date.
“Rule 462 Registration Statement” has the meaning set forth in Section 3.01.
“Sales Agency Agreements” has the meaning set forth in the Recitals.
“Sales Price” means the actual sale execution price of each Program Share sold by
BNYMCM on the Principal Market hereunder in the case of ordinary brokers’ transactions, or as
otherwise agreed by the parties in other methods of sale.
“Xxxxxxxx-Xxxxx Act” has the meaning set forth in Section 3.40.
“Securities Act” means the Securities Act of 1933, as amended.
“Securities Act Regulations” has the meaning set forth in Section 3.01.
“Selling Commission” means at a mutually agreed rate, not to exceed 2.0%, of the Sales
Price of Program Shares sold during a Selling Period.
“Selling Period” means the period of one to ten consecutive Trading Days (as
determined by EQR in EQR’s sole discretion and specified in the applicable Issuance Notice)
following the Trading Day on which an Issuance Notice is delivered or deemed to be delivered
pursuant to Section 2.03(b) hereof.
“Settlement Date” means, unless EQR and BNYMCM shall otherwise agree, the third
business day following each Trading Day during the Selling Period, when EQR shall deliver to BNYMCM
the amount of Program Shares sold on such Trading Day and BNYMCM shall deliver to EQR the Issuance
Price received on such sales.
“Standoff Period” has the meaning set forth in Section 4.10.
“Trading Day” means any day which is a trading day on the Principal Market, other than
a day on which trading is scheduled to close prior to its regular weekday closing time.
“Transaction Entities” has the meaning set forth in the Preamble.
ARTICLE II
ISSUANCE AND SALE OF COMMON SHARES
ISSUANCE AND SALE OF COMMON SHARES
Section 2.01 Issuance. (a) Upon the terms and subject to the conditions of this
Agreement, EQR may issue Program Shares through BNYMCM and BNYMCM shall use its
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commercially reasonable efforts to sell Program Shares, up to the Maximum Program Amount,
based on and in accordance with such number of Issuance Notices as EQR in its sole discretion shall
choose to deliver during the Commitment Period until the number of the Program Shares sold under
the Sales Agency Agreements equals the Maximum Program Amount or this Agreement is otherwise
terminated. Subject to the foregoing and the other terms and conditions of this Agreement, upon
the delivery of an Issuance Notice, and unless the sale of the Issuance Shares described therein
has been suspended, cancelled or otherwise terminated in accordance with the terms of this
Agreement, BNYMCM will use its commercially reasonable efforts consistent with its normal trading
and sales practices to sell such Issuance Shares up to the amount specified into the Principal
Market, and otherwise in accordance with the terms of such Issuance Notice. BNYMCM will provide
written confirmation to EQR no later than the opening of the Trading Day next following the Trading
Day on which it has made sales of Issuance Shares hereunder setting forth the portion of the Actual
Sold Amount for such Trading Day, the corresponding Sales Price and the Issuance Price payable to
EQR in respect thereof. BNYMCM may sell Issuance Shares in the manner described in Section 2.01(b)
herein. Each of the Transaction Entities acknowledges and agrees that (i) there can be no
assurance that BNYMCM will be successful in selling Issuance Shares and (ii) BNYMCM will incur no
liability or obligation to the Transaction Entities or any other Person if it does not sell
Issuance Shares for any reason other than a failure by BNYMCM to use its commercially reasonable
efforts consistent with its normal trading and sales practices to sell such Issuance Shares as
required under this Section 2.01. In acting hereunder, BNYMCM will be acting as agent for EQR and
not as principal.
(b) Method of Offer and Sale. The Program Shares may be offered and sold in
(1) privately negotiated transactions (if and only if the parties hereto have so agreed in
writing), or (2) by any other method or payment permitted by law deemed to be an “at the market”
offering as defined in Rule 415 of the Securities Act, including sales made directly on the
Principal Market or sales made to or through a market maker or through an electronic communications
network. Nothing in this Agreement shall be deemed to require either party to agree to the method
of offer and sale specified in clause (1) above, and either party may withhold its consent thereto
in such party’s sole discretion.
(c) Issuances. Upon the terms and subject to the conditions set forth
herein, on any Trading Day as provided in Section 2.03(b) hereof during the Commitment Period on
which the conditions set forth in Section 5.01 and 5.02 hereof have been satisfied, EQR may
exercise an Issuance by the delivery of an Issuance Notice, executed by the Chief Executive
Officer, the President, the Chief Financial Officer, the Senior Vice President-Finance or the
Treasurer of EQR, to BNYMCM. BNYMCM shall use its commercially reasonable efforts to sell pursuant
to such Issuance a number of Program Shares equal to the Issuance Amount. Each Issuance will be
settled on the applicable Settlement Date following the Issuance Date.
Section 2.02 Effectiveness. The effectiveness of this Agreement (the
“Closing”) shall be deemed to take place concurrently with the execution and delivery of
this Agreement by the parties hereto and the completion of the closing transactions set forth in
the immediately following sentence. At the Closing, the following closing transactions shall take
place, each of which shall be deemed to occur simultaneously with the Closing: (i) EQR shall
deliver to BNYMCM a certificate executed by the Secretary of EQR, signing in such capacity, on
behalf of EQR and in its
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capacity as general partner of ERP, dated the date of the Closing (A) certifying that attached
thereto are true and complete copies of the resolutions duly adopted by the Board of Trustees of
EQR authorizing the execution and delivery of this Agreement by EQR and the consummation of the
transactions contemplated hereby (including, without limitation, the issuance of the Program
Shares pursuant to the Sales Agency Agreement), which authorization shall be in full force and
effect on and as of the date of such certificate and (B) certifying and attesting to the office,
incumbency, due authority and specimen signatures of each Person who executed the Agreement for or
on behalf of EQR; (ii) EQR shall deliver to BNYMCM a certificate executed by the Chief Executive
Officer, the President or any Senior or Executive Vice-President of EQR and by the Chief Financial
Officer of EQR, signing in such capacity, on behalf of EQR and in its capacity as general partner
of ERP, dated the date of the Closing, confirming (x) that there has been no Material Adverse
Effect since the date as of which information is given in the Prospectus as then amended or
supplemented, (y) that the representations and warranties of the Transaction Entities contained in
this Agreement are true and correct and (z) that each of the Transaction Entities has performed all
of its obligations hereunder to be performed on or prior to the Closing Date and as to the matters
set forth in Section 5.01(a) hereof; (iii) DLA Piper LLP (US), counsel to EQR, shall deliver to
BNYMCM opinion letters, dated the date of the Closing and addressed to BNYMCM, substantially in the
forms of Exhibit B and Exhibit C attached hereto; (iv) the General Counsel of EQR shall deliver to
BNYMCM an opinion, dated the date of the Closing and addressed to BNYMCM, substantially in the form
of Exhibit D attached hereto; (v) Xxxxx Lovells US LLP, counsel to BNYMCM and the Alternative Sales
Agents, shall deliver to BNYMCM and the Alternative Sales Agents an opinion, dated the date of the
Closing and addressed to BNYMCM and the Alternative Sales Agents, in form and substance
satisfactory to BNYMCM and the Alternative Sales Agents; (vi) Ernst & Young LLP shall deliver to
BNYMCM a letter, dated the Closing Date, in form and substance satisfactory to BNYMCM, containing
statements and information of the type ordinarily included in accountants’ “comfort letters” to
underwriters, with respect to the financial statements of EQR included or incorporated by reference
in the Registration Statement, the Prospectus and the General Disclosure Package; and (vii) EQR
shall pay the expenses set forth in Section 9.02(ii) and (viii) hereof by wire transfer to the
account designated by BNYMCM in writing prior to the Closing.
Section 2.03 Mechanics of Issuances.
(a) Issuance Notice. On any Trading Day during the Commitment Period, EQR may deliver
an Issuance Notice to BNYMCM, subject to the satisfaction of the conditions set forth in Sections
5.01 and 5.02; provided, however, that notwithstanding anything in this Agreement to the contrary,
(1) BNYMCM shall not be obligated to sell on any Trading Day a number of Issuance Shares in excess
of 25% of the Average Daily Trading Volume of Common Shares on the Principal Exchange without the
prior written consent of BNYMCM, which may be withheld in BNYMCM’s sole discretion, and (2) BNYMCM
shall have no further obligations with respect to any Issuance Notice if and to the extent the
number of the Issuance Shares sold pursuant thereto, together with the aggregate number of the
Program Shares previously sold under the Sales Agency Agreements, shall exceed the Maximum Program
Amount. EQR shall have the right, in its sole discretion, to amend at any time and from time to
time any Issuance Notice; provided,
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however, that EQR may not amend the Issuance Amount if such
amended Issuance Amount is less than the Actual Sold Amount as of the date of such amendment.
(b) Delivery of Issuance Notice. An Issuance Notice shall be deemed delivered on the
Trading Day that it is received by facsimile or otherwise (and EQR confirms such delivery by e-mail
notice or by telephone (including voicemail message)) by BNYMCM. No Issuance Notice may be
delivered other than on a Trading Day during the Commitment Period.
(c) Floor Price. BNYMCM shall not sell Program Shares below the Floor Price during
any Selling Period and such Floor Price may be adjusted by EQR at any time during any Selling
Period upon notice to BNYMCM and confirmation to EQR.
(d) Determination of Issuance Shares to be Sold. The number of Issuance Shares to be
sold by BNYMCM with respect to any Issuance shall be the Actual Sold Amount during the Selling
Period.
(e) Trading Guidelines. EQR consents to BNYMCM trading in Program Shares for BNYMCM’s
own account and for the account of its clients at the same time as sales of Program Shares occur
pursuant to this Agreement, provided, however, that such consent is expressly limited to trading
activity that complies with applicable federal and state laws, rules and regulations.
Section 2.04 Settlements. Subject to the provisions of Article V, on or before each
Settlement Date, EQR will, or will cause its transfer agent to, electronically transfer the
applicable Issuance Shares that have been sold by crediting BNYMCM or its designee’s account at the
Depository Trust Company through its Deposit/Withdrawal At Custodian (DWAC) System, or by such
other means of delivery as may be mutually agreed upon by the parties hereto and, upon receipt of
such Issuance Shares, which in all cases shall be freely tradeable, transferable, registered shares
in good deliverable form, BNYMCM will deliver the related Issuance Price in same day funds
delivered to an account designated by EQR prior to the Settlement Date. If EQR defaults in its
obligation to deliver Issuance Shares on a Settlement Date, EQR agrees that it will (i) hold BNYMCM
harmless against any loss, claim, damage or expense (including, without limitation, penalties,
interest and reasonable legal fees and expenses), as incurred, arising out of or in connection with
such default by EQR, and (ii) pay to BNYMCM any Selling Commission to which it would otherwise have
been entitled absent such default. The parties acknowledge and agree that, in performing its
obligations under this Agreement, BNYMCM may borrow Common Shares from stock lenders, and may use
the Issuance Shares to settle or close out such borrowings.
Section 2.05 Use of Free Writing Prospectus. Other than any press release to be
issued by EQR on the date hereof and filed as a free writing prospectus, a copy of which has been
provided to BNYMCM, neither EQR nor BNYMCM has prepared, used, referred to or distributed, or will
prepare, use, refer to or distribute, without the other party’s prior written consent, which
consent shall not be unreasonably withheld, any “written communication” which constitutes a “free
writing prospectus” as such terms are defined in Rule 405 under the Securities Act with respect to
the offering of Program Shares contemplated by this Agreement.
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Section 2.06 Alternative Sales Agents. EQR agrees that any offer to sell, any
solicitation of an offer to buy, or any sales of Program Shares or any other equity security of EQR
shall only be
effected by or through only one of BNYMCM or the Alternative Sales Agents on any single given
day, but in no event by more than one, and EQR shall in no event request that BNYMCM and any other
Alternative Sales Agent sell Program Shares on the same day.
Section 2.07 Exemption from Regulation M. If any party believes that the exemptive
provisions set forth in Rule 101(c)(1) of Regulation M under the Exchange Act (applicable to
securities with an average daily trading volume of $1,000,000 that are issued by an issuer whose
common equity securities have a public float value of at least $150,000,000) are not satisfied with
respect to EQR or the Program Shares, it shall promptly notify the other party and sales of
Program Shares under the Sales Agency Agreements shall be suspended until that or other exemptive
provisions have been satisfied in the reasonable judgment of all parties.
Section 2.08 Distributions under Regulation M. Notwithstanding any other provision of
this Agreement, in the event EQR engages BNYMCM for a sale of Program Shares that would constitute
a “distribution” within the meaning of Rule 100 of Regulation M under the Exchange Act, EQR and
BNYMCM will agree to compensation that is customary for BNYMCM with respect to such transactions.
Section 2.09 Material Non-Public Information. Notwithstanding any other provision of
this Agreement, BNYMCM shall not be obligated to sell any Program Shares hereunder during (i) any
period in which it reasonably believes that EQR is, or could be deemed to be, in possession of
material non-public information or (ii) during the fourteen (14) calendar days prior to any public
announcement or release disclosing EQR’s results of operations or financial condition for a
completed quarterly or annual fiscal period.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE TRANSACTION ENTITIES
REPRESENTATIONS AND WARRANTIES OF THE TRANSACTION ENTITIES
Each of EQR and ERP, jointly and severally, represent and warrant to BNYMCM, as of the Closing
Date, each Issuance Date, each Settlement Date, each Registration Statement Amendment Date (as
defined in Section 4.07), each Request Date and each Applicable Time (each, a “Representation
Date”), as follows:
Section 3.01 EQR has filed with the Commission an automatic shelf registration statement on
Form S-3 (No. 333-156156) for the registration of EQR’s securities, including the Common Shares,
under the Securities Act, and the offering thereof from time to time in accordance with Rule 430A
or Rule 415 of the rules and regulations of the Commission under the Securities Act (the
“Securities Act Regulations”), and EQR has filed such amendments thereto as may have been
required prior to the execution of this Agreement. Such registration statement (as amended, if
applicable) became effective upon filing with the Commission. Such registration statement and the
base prospectus constituting a part thereof (including in each case the information, if any, deemed
to be part thereof pursuant to Rule 430A, Rule 430B or Rule 430C of the Securities Act Regulations)
(the “Base Prospectus”) and the Prospectus Supplement (as defined in Section 5.01(k)) and
any pricing supplement relating to a particular issuance of the
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Issuance Shares (the “Issuance
Supplement”), including all documents incorporated therein by reference, as from time to time
amended or supplemented pursuant to the Securities Act, the
Exchange Act or otherwise, are collectively referred to herein as the “Registration
Statement.” The term “Prospectus” means the Prospectus Supplement together with the
Base Prospectus and any Issuance Supplements; provided, that if any revised prospectus shall be
provided to BNYMCM by EQR for use in connection with the offering of Program Shares, including any
prospectus included in any new registration statement filed prior to the Renewal Deadline as
contemplated in Section 4.01 below, which differs from the Prospectus on file at the Commission at
the time the Registration Statement became effective (whether or not such revised prospectus is
required to be filed by EQR pursuant to Rule 424(b) of the Securities Act Regulations), the term
“Prospectus” shall refer to each such revised or new prospectus from and after the time it is first
provided to BNYMCM for such use; provided, further, that a Prospectus Supplement shall be deemed to
have supplemented the Prospectus only with respect to the offering of Program Shares hereunder. If
EQR files a registration statement with the Commission pursuant to Rule 462(b) of the Securities
Act Regulations (the “Rule 462 Registration Statement”), then, after such filing, all
references to “Registration Statement” shall also be deemed to include the Rule 462 Registration
Statement. Any prospectus included in the Rule 462 Registration Statement shall be deemed to be
part of the Prospectus. All references in this Agreement to financial statements and schedules and
other information which is “contained,” “included” or “stated” in the Registration Statement or the
Prospectus (and all other references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is or is deemed to be incorporated
by reference in the Registration Statement or the Prospectus; and all references in this Agreement
to amendments or supplements to the Registration Statement and the Prospectus shall be deemed to
mean and include the filing of any document under the Exchange Act which is or is deemed to be
incorporated by reference in the Registration Statement or the Prospectus, as the case may be.
Section 3.02 The Registration Statement and the Prospectus, at the time the Registration
Statement and any post-effective amendment thereto (including the filing of EQR’s most recent
Annual Report on Form 10-K and most recent Quarterly Report on Form 10-Q with the Commission)
became effective, complied, and as of each Representation Date will comply, in all material
respects with the requirements of the Securities Act and the Securities Act Regulations; the
Prospectus, at the time of filing thereof, complied, and as of each Representation Date will
comply, in all material respects with the requirements of the Securities Act and the Securities Act
Regulations; the Registration Statement, at the time the Registration Statement became effective,
did not, and as of each Representation Date, will not, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary to make the
statements therein not misleading; the Prospectus, at the time of filing thereof, did not, and as
of each Representation Date, will not, include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; the Prospectus, as of each Representation
Date, and the applicable Issuer Free Writing Prospectus(es), if any, issued at or prior to the
Applicable Time, taken together (collectively, and, with respect to any Program Shares, together
with the public offering price of such Program Shares, the “General Disclosure Package”) as
of each Applicable Time and the Closing Date, as the case may be, will not contain any untrue
statement of a material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided, however, that the representations and warranties in this
subsection shall not apply to
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statements in, or omissions from, the Registration Statement, the
Prospectus or any Issuer Free Writing Prospectus(es) made in reliance upon, and in conformity with,
information furnished to
EQR in writing by BNYMCM expressly for use in the Registration Statement, the Prospectus or
the Issuer Free Writing Prospectus(es), as applicable; and provided further, that the foregoing
representations and warranties are given on the basis that any statement contained in a document
incorporated or deemed to be incorporated in the General Disclosure Package prior to any Settlement
Date shall be deemed not to be contained in the General Disclosure Package to the extent that such
statement has been modified or superseded by any subsequent statement in the General Disclosure
Package.
Section 3.03 (A) At the time of filing the Registration Statement, (B) at the time of the
most recent amendment thereto for the purposes of complying with Section 10(a)(3) of the Securities
Act (whether such amendment was by post-effective amendment or incorporated report filed pursuant
to Section 13 or 15(d) of the Exchange Act or form of prospectus), (C) at the time EQR or any
person acting on its behalf (within the meaning, for this clause only, of Rule 163(c) of the
Securities Act) made any offer relating to the Program Shares in reliance on the exemption of Rule
163 of the Securities Act, and (D) as of the date of the execution and delivery of this Agreement,
EQR was and is a “well-known seasoned issuer” as defined in Rule 405 of the Securities Act. The
Registration Statement is an “automatic shelf registration statement,” as defined in Rule 405 of
the 1933 Act, that initially became effective within three years of the date hereof, EQR has not
received from the Commission any notice pursuant to Rule 401(g)(2) of the Securities Act objecting
to use of the automatic shelf registration statement form and EQR has not otherwise ceased to be
eligible to use the automatic shelf registration statement form. EQR meets the eligibility
requirements for use of a registration statement on Form S-3 in connection with the offer and sale
of the Program Shares.
Section 3.04 (A) At the earliest time after the filing of the Registration Statement relating
to the Program Shares that EQR or another offering participant made a bona fide offer (within the
meaning of Rule 164(h)(2) of the Securities Act) and (B) as of the date of the execution and
delivery of this Agreement, EQR was not and is not an Ineligible Issuer (as defined in Rule 405 of
the Securities Act), without taking into account any determination by the Commission pursuant to
Rule 405 of the Securities Act that it is not necessary that EQR be considered an Ineligible
Issuer.
Section 3.05 Other than the Prospectus, EQR (including its agents and representatives, other
than BNYMCM and the Alternative Sales Agents in their capacity as such) has not made, used,
prepared, authorized, approved or referred to, and will not make, use, prepare, authorize, approve
or refer to, any “written communication” (as defined in Rule 405 under the 0000 Xxx) that
constitutes an offer to sell or solicitation of an offer to buy the Program Shares (each such
communication by EQR or its agents and representatives (other than a communication referred to in
clause (i) below) an “Issuer Free Writing Prospectus”) other than (i) any document not
constituting a prospectus pursuant to Section 2(a)(10)(a) of the Securities Act or Rule 134 under
the Securities Act or (ii) other written communications approved in writing in advance by BNYMCM.
Each such Issuer Free Writing Prospectus complied in all material respects with the requirements of
the Securities Act Regulations, has been filed in accordance with the Securities Act Regulations
(to the extent required thereby) and, when taken together with the Prospectus filed prior to the
first use of such Issuer Free Writing Prospectus, did not, and at the time of Closing will not,
include an untrue statement of a material fact or omit to state a material fact necessary in order
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to make the statements therein, in the light of the circumstances under which they were made, not
misleading; provided that neither Transaction Entity makes any representation or warranty with
respect to any statements or omissions made in each such Issuer Free Writing Prospectus in
reliance upon and in conformity with information relating to BNYMCM or any Alternative Sales Agent
furnished to EQR in writing by BNYMCM or such Alternative Sales Agent expressly for use in any
Issuer Free Writing Prospectus.
Section 3.06 No stop order suspending the effectiveness of the Registration Statement or any
part thereof has been issued and no proceeding for that purpose has been instituted or, to the
knowledge of EQR, threatened by the Commission or by the state securities authority of any
jurisdiction. No order preventing or suspending the use of the Prospectus has been issued and no
proceeding for that purpose has been instituted or, to the knowledge of EQR, threatened by the
Commission or by the state securities authority of any jurisdiction. Any request on the part of
the Commission for additional information relating to the Program Shares or the Prospectus has been
complied with.
Section 3.07 The accountants who certified the financial statements and supporting schedules
included or incorporated by reference in the Registration Statement and the Prospectus are a
registered public accounting firm with respect to EQR within the applicable rules and regulations
adopted by the Commission and the Public Accounting Oversight Board (United States) and as required
by the Securities Act and the Securities Act Regulations.
Section 3.08 The consolidated financial statements and related notes included or incorporated
by reference in the Registration Statement and the Prospectus present fairly in all material
respects the financial position of EQR and its consolidated subsidiaries as at the dates indicated
and the results of their operations specified, and except as may otherwise be stated in the
Registration Statement and the Prospectus, have been prepared in accordance with generally accepted
accounting principles (“GAAP”) applied on a consistent basis throughout such periods. The
supporting schedules included or incorporated by reference in the Registration Statement present
fairly in accordance with GAAP the information required to be stated therein. The financial
information and statistical data included in the Registration Statement and the Prospectus present
fairly in all material respects the information included therein and have been prepared on a basis
consistent with that of the financial statements included in the Registration Statement and the
Prospectus. The pro forma financial statements included in the Registration Statement and the
Prospectus, if any, comply in all material respects with the applicable requirements of Rule 11-02
of Regulation S-X of the Commission and the pro forma adjustments have been properly applied to the
historical amounts in the compilation of such statements, and the assumptions used in the
preparation thereof are, in the opinion of EQR, reasonable.
Section 3.09 Since the respective dates as of which information is given in the Registration
Statement or the Prospectus, except as otherwise stated or contemplated therein, (A) there has been
no Material Adverse Effect, (B) there have been no material transactions entered into by EQR or any
of its subsidiaries, other than transactions in the ordinary course of business, which are material
with respect to EQR and its subsidiaries considered as a single enterprise, (C) neither EQR nor any
of its subsidiaries has incurred any material obligation or liability, direct, contingent or
otherwise, (D) there has been no material change in the short-term debt or long-term debt of EQR
and (E) except for (i) regular quarterly distributions on EQR’s Common Shares and
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preferred shares
of beneficial interest, $.01 par value and (ii) as disclosed in the Prospectus, there
has been no dividend or distribution of any kind declared, paid or made by EQR on any class of
its shares of beneficial interest.
Section 3.10 EQR and each of its subsidiaries has been duly incorporated or formed and is
validly existing and is in good standing as a partnership, corporation or limited liability company
under the laws of its jurisdiction of organization, with partnership, corporate or limited
liability company power and authority to own, lease and operate its properties and conduct its
business as described in the Prospectus, and each of EQR and ERP has the power and authority to
enter into and perform its obligations under this Agreement.
Section 3.11 EQR and each of its subsidiaries is duly qualified or registered as a foreign
organization to transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by the nature of its business or its ownership or leasing of
property, except where the failure to so qualify would not have a Material Adverse Effect.
Section 3.12 The Program Shares have been duly authorized for issuance and sale pursuant
hereto and, when issued and delivered as provided herein, the Program Shares will be validly
issued, fully paid and non-assessable; the Program Shares conform, in all material respects, to the
descriptions thereof contained in the Prospectus; and the issuance of the Program Shares is not
subject to preemptive or similar rights.
Section 3.13 Prior to the first Settlement Date after the date hereof, the Program Shares will
have been approved for listing on the Principal Market upon official notice of issuance.
Section 3.14 The capitalization of EQR is as set forth in the Prospectus and all of the issued
and outstanding Common Shares and the Preferred Shares have been duly authorized and validly issued
and are fully paid and non-assessable; and none of such shares of beneficial interest were issued
in violation of preemptive or other similar rights of any securityholder of EQR.
Section 3.15 The capitalization of ERP is as set forth in the Prospectus and all of the
outstanding partnership interests of ERP have been duly authorized and validly issued and the
capital contributions with respect thereto have been made in full; the partnership interests owned
by EQR are owned in the percentage amount set forth in the Prospectus free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity.
Section 3.16 Except for transactions described in the Prospectus, there are no outstanding
rights, warrants or options to acquire, or instruments convertible into or exchangeable for, or
agreements or understandings with respect to the sale or issuance or registration under the 1933
Act of, any shares of beneficial interest or capital stock of, or partnership or other equity
interest in, EQR or any subsidiary of EQR except for multifamily property acquisition agreements
with respect to the sale or issuance of Common Shares or units of limited partnership interests in
ERP or registration of Common Shares or Common Shares underlying units of limited partnership
interests in ERP which are not material in amount.
Section 3.17 All of the issued and outstanding shares of beneficial interest or capital stock,
partnership and limited liability company interests, as the case may be, of each subsidiary have
been validly issued and, in the case of capital stock, fully paid and, with respect to the shares
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of capital stock, partnership and limited liability company interests owned by EQR, ERP, another
subsidiary and/or certain affiliated entities, are owned by EQR, ERP, another subsidiary,
and/or certain affiliated entities, respectively, as described in the Registration Statement and
the Prospectus, in each case free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity. EQR owns no direct or indirect equity interest in any entity other
than its subsidiaries, except for such interests as, in the aggregate, are not material to the
financial condition or the earnings, assets or business affairs of EQR and its subsidiaries
considered as a single enterprise.
Section 3.18 This Agreement has been duly authorized, executed and delivered by each of EQR
and ERP, as applicable, and, assuming it has been duly authorized, executed and delivered by
BNYMCM, constitutes a valid and binding obligation of each of EQR and ERP, as applicable,
enforceable against EQR and ERP, as applicable, in accordance with its terms, except a (A) the
enforceability thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors’ rights generally, (B) the availability of equitable remedies may
be limited by equitable principles of general applicability and (C) rights to indemnity and
contribution hereunder may be limited by state or federal securities laws or the public policy
underlying such laws.
Section 3.19 There is no action, suit or proceeding before or by any court or governmental
agency or body, now pending, or, to the knowledge of EQR or ERP, threatened, against or affecting
EQR or any of its subsidiaries which is required to be disclosed in the Prospectus (other than as
disclosed therein) or which could reasonably be expected to result in a Material Adverse Effect or
which could reasonably be expected to materially and adversely affect the properties thereof which
individually or in the aggregate are material to the business of EQR and its subsidiaries,
considered as one enterprise, or which could reasonably be expected to materially and adversely
affect the consummation of this Agreement or the transactions contemplated herein or therein; all
pending legal or governmental proceedings to which EQR or any of its subsidiaries is a party or of
which any of their properties or assets is the subject which are not described in the Prospectus,
including ordinary routine litigation incidental to the business, could not, considered in the
aggregate, reasonably be expected to result in a Material Adverse Effect; and there are no
contracts or documents of EQR or any of its subsidiaries which would be required to be filed as
exhibits to the Registration Statement by the Securities Act or the Securities Act Regulations
which have not been filed as exhibits to the Registration Statement.
Section 3.20 None of EQR or any of its subsidiaries is required to own or possess any
trademarks, service marks, trade names or copyrights to conduct the business operated by it as of
any Representation Date, other than those as to which the failure to possess or own would not have
a Material Adverse Effect; and none of EQR or any of its subsidiaries has received any notice or is
otherwise aware of any infringement of or conflict with asserted rights of others with respect to
any trademarks, service marks, trade names or copyrights or of any facts or circumstances which
would render any trademarks, service marks, trade names or copyrights invalid or inadequate to
protect the interest of EQR or any of its subsidiaries therein, and which infringement or conflict
(if the subject of any unfavorable decision, ruling or finding) or invalidity or inadequacy, singly
or in the aggregate, would result in a Material Adverse Effect.
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Section 3.21 No authorization, approval or consent of any court or governmental authority or
agency is required that has not been obtained in connection with the consummation by
EQR of the transactions contemplated hereby, by this Agreement, except such as may be required
under the Securities Act, the Trust Indenture Act of 1939, the Securities Act Regulations or state
securities law.
Section 3.22 Each of EQR and its subsidiaries has all consents, authorizations, approvals,
orders, certificates and permits (collectively, the “Governmental Licenses”) of and from,
and has made all declarations and filings with, all federal, state, local and other governmental
authorities, all self-regulatory organizations and all courts and other tribunals required for it
to own, lease, license and use its properties and assets and to conduct its business in the manner
described in the Registration Statement and the Prospectus, except to the extent that the failure
to obtain or file would not have a Material Adverse Effect; and all of the Governmental Licenses
are valid and in full force and effect, except where the invalidity of such Governmental Licenses
or the failure of such Governmental Licenses to be in full force and effect would not result in a
Material Adverse Effect; and none of EQR or any of its subsidiaries has received any written notice
of proceedings relating to the revocation or modification of any such consent, authorization,
approval, order, certificate or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a Material Adverse Effect.
Section 3.23 The documents incorporated or deemed to be incorporated by reference in the
Registration Statement and the Prospectus, when they became effective or at the time they were or
hereafter are filed with the Commission, complied and will comply in all material respects with the
requirements of the Exchange Act and the rules and regulations of the Commission under the Exchange
Act (the “Exchange Act Regulations”), and, when read together with the other information in
(a) the Registration Statement, at the time the Registration Statement became effective, did not,
or (b) the Prospectus, at its date and on each Representation Date, did not, does not and will not,
include an untrue statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
Section 3.24 Each of EQR and its subsidiaries is insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are prudent and customary in
the businesses in which they are engaged; and neither EQR nor ERP has any reason to believe that
EQR or any of its subsidiaries will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from similar insurers as may be necessary
to continue its businesses at a cost that would not have a Material Adverse Effect, except as
described in or contemplated by the Registration Statement or the Prospectus.
Section 3.25 None of EQR nor any of its subsidiaries is in violation of its charter documents,
bylaws, limited liability company agreements or partnership agreements, or in default in the
performance of any material obligation, agreement or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other instrument to which it or any of them is
a party or by which it or any of them may be bound, or to which any of their properties or assets
is subject, which default in performance would result in a Material Adverse Effect; and the
execution, delivery and performance of this Agreement or any other agreement or instrument entered
into or issued or to be entered into or issued by EQR in connection with the transactions
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contemplated herein and the consummation of the transactions contemplated hereby, including the
issuance, sale and delivery of the Program Shares and the use of proceeds described in the
Prospectus, has been duly authorized by all necessary actions and does not and will not
conflict with or constitute a breach of, or default under, or result in the creation or imposition
of any lien, charge or encumbrance upon any property or assets of EQR or any of its subsidiaries,
pursuant to any contract, indenture, mortgage, loan agreement, note, lease or other instrument to
which EQR or any of its subsidiaries is a party or by which it or any of them may be bound or
affected, or to which any of their properties or assets is subject, nor will such action result in
any violation of the provisions of the charter documents, bylaws, limited liability company
agreements or partnership agreements of EQR or any of its subsidiaries, or any applicable law,
regulation, ruling, order, judgment, administrative regulation or administrative or court decree.
Section 3.26 Neither EQR nor ERP has taken or will take, directly or indirectly, any action
prohibited by Regulation M.
Section 3.27 The assets of EQR do not constitute “plan assets” under the Employee Retirement
Income Security Act of 1974, as amended.
Section 3.28 Except as otherwise described in the Prospectus, each of EQR and its subsidiaries
has good and marketable title in fee simple to all real property, and good title to all personal
property (including mortgage investments), owned by it which is material to the business of EQR and
its subsidiaries, considered as a single enterprise, in each case, free and clear of all liens,
claims, encumbrances and defects except such as are described in general in the Prospectus or such
as do not materially affect the value of such property and do not interfere with the use made and
proposed to be made of such property by EQR or any of its subsidiaries; and any real property and
buildings held under lease by EQR or any of its subsidiaries are held by it under valid, subsisting
and enforceable leases with such exceptions as are not material and do not interfere with the use
made and proposed to be made of such property and buildings by EQR or such subsidiaries, in each
case except as described in or contemplated by the Registration Statement and the Prospectus.
Section 3.29 Each of EQR and its subsidiaries has obtained title insurance on all of the
material properties owned by each of them covering risks and in amounts that are commercially
reasonable for the assets owned by them and that are consistent with the types and amounts of
insurance typically maintained by current owners of similar properties, and in each case such title
insurance is in full force and effect.
Section 3.30 The mortgages and deeds of trust encumbering the material properties and assets
described in general in the Prospectus are not convertible and are not cross-defaulted or
cross-collateralized to any property not owned by EQR or any of its subsidiaries; except as
disclosed in the Prospectus, none of EQR or any of its subsidiaries holds participating interests
in such mortgages and deeds of trust.
Section 3.31 Each of the partnership agreements and limited liability company agreements to
which EQR or any of its subsidiaries is a party has been duly authorized, executed and delivered by
such party and constitutes the valid agreement thereof, enforceable in accordance with its terms,
except as (A) the enforceability thereof may be limited by bankruptcy, insolvency,
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reorganization,
moratorium or similar laws affecting creditors’ rights generally and (B) the availability of
equitable remedies may be limited by equitable principles of general applicability;
and the execution, delivery and performance of any of such agreements did not, at the time of
execution and delivery, and does not constitute a breach of, or default under, the partnership
agreement, charter, bylaws or other governing documents of such party or any material contract,
lease or other instrument to which such party is a party or by which its properties may be bound or
any law, administrative regulation or administrative or court decree.
Except as otherwise stated in the Registration Statement or the Prospectus or as would not,
singly or in the aggregate, result in a Material Adverse Effect, (A) neither EQR nor any of its
subsidiaries is in violation of any federal, state, local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law or any judicial or administrative
interpretation thereof including any judicial or administrative order, consent, decree or judgment,
relating to pollution or protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or
wildlife, including, without limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, “Hazardous Materials”) or to the
manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, “Environmental Laws”), (B) EQR and its subsidiaries have
all permits, authorizations and approvals required under any applicable Environmental Laws and are
each in compliance with their requirements, (C) there are no pending or threatened administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens, notices of
noncompliance or violation, investigation or proceedings relating to any Environmental Law against
EQR or any of its subsidiaries and (D) there are no events or circumstances that could reasonably
be expected to form the basis of an order for clean-up or remediation, or an action, suit or
proceeding by any private party or governmental body or agency, against or affecting EQR or any of
its subsidiaries relating to Hazardous Materials or any Environmental Laws.
Section 3.32 EQR has operated and intends to continue to operate in such a manner as to
qualify to be taxed as a “real estate investment trust” under the Code.
Section 3.33 Each of EQR and its subsidiaries has filed all federal, state, local and foreign
income tax returns which have been required to be filed and has paid all taxes required to be paid
and any other assessment, fine or penalty levied against it, to the extent that any of the
foregoing is due and payable, except in all cases for any such tax, assessment, fine or penalty for
which an extension has been granted or that is being contested in good faith and except in any case
in which the failure to file or pay such taxes would not have a Material Adverse Effect.
Section 3.34 Neither ERP nor any subsidiary is and, after giving effect to the offering and
sale of the Program Shares and the application of the proceeds thereof as described in the
Prospectus, will not be an “investment company” as defined in the Investment Company Act of 1940,
as amended.
Section 3.35 No labor dispute with the employees of EQR, or any of EQR’s subsidiaries exists,
or to the knowledge of EQR, is imminent which could reasonably be expected to have a Material
Adverse Effect.
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Section 3.36 EQR maintains a system of internal accounting and other controls sufficient to
provide reasonable assurances that (a) transactions are executed in accordance with management’s
general or specific authorization, (b) transactions are recorded as necessary to permit preparation
of financial statements in conformity with GAAP and to maintain accountability for assets, (c)
acquisition, disposition or other uses of assets are permitted only in accordance with management’s
general or specific authorization and (d) the recorded accounting for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with respect to any
differences.
Section 3.37 EQR has established and maintains disclosure controls and procedures (as such
term is defined in Rule 13a-15(e) under the Exchange Act); such disclosure controls and procedures
are designed to ensure that material information relating to EQR, including its consolidated
subsidiaries, is made known to the principal executive officer and principal financial officer of
EQR by others within those entities, and, as of the end of EQR’s most recent fiscal quarter, there
are no material weaknesses in disclosure controls and procedures; EQR’s auditors and the Audit
Committee of the Board of Trustees of EQR have been advised by the principal executive officer and
principal financial officer of EQR of: (a) any material weakness or significant deficiency in the
design or operation of internal controls over financial reporting which is reasonably likely to
have a material adverse effect on EQR’s ability to record, process, summarize, and report financial
information; and (b) any fraud, whether or not material, that involves management or other
employees who have a significant role in EQR’s internal control over financial reporting; and since
the end of EQR’s most recently completed fiscal quarter, there have been no changes in EQR’s
internal controls over financial reporting that have materially affected, or are reasonably likely
to materially affect, EQR’s internal controls over financial reporting.
Section 3.38 EQR is in compliance in all material respects with the applicable provisions of
the Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations promulgated in connection therewith
(the “Xxxxxxxx-Xxxxx Act”), including Section 402 relating to loans and Sections 302 and
906 relating to certifications.
Section 3.39 The operations of EQR and its subsidiaries are in compliance in all material
respects with applicable financial recordkeeping and reporting requirements and the money
laundering statutes and the rules and regulations thereunder and any related or similar rules,
regulations or guidelines, issued, administered or enforced by any governmental agency
(collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before
any court or governmental agency, authority or body or any arbitrator involving EQR or any of its
subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of EQR or
ERP, threatened.
Section 3.40 Neither the Transaction Entities nor, to the knowledge of the Transaction
Entities, any director, officer, agent, employee, affiliate or other person acting on behalf of the
Transaction Entities or any of its subsidiaries is aware of or has taken any action, directly or
indirectly, that would result in a violation by such persons of the Foreign Corrupt Practices Act
of 1977, as amended, and the rules and regulations thereunder (the “FCPA”), including,
without limitation, making use of the mails or any means or instrumentality of interstate commerce
corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of
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any money, or other property, gift, promise to give, or authorization of the giving of
anything of value to any “foreign official” (as such term is defined in the FCPA) or any foreign
political party or official thereof or any candidate for foreign political office, in contravention
of the FCPA and the Transaction Entities and, to the knowledge of the Transaction Entities, its
affiliates have conducted their businesses in compliance with the FCPA and have instituted and
maintain policies and procedures designed to ensure, and which are reasonably expected to continue
to ensure, continued compliance therewith.
Section 3.41 Neither of the Transaction Entities nor any of their subsidiaries or, to the
knowledge of the Transaction Entities, any director, officer, agent, employee or affiliate of the
Transaction Entities or any of their subsidiaries is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury
(“OFAC”); and the Transaction Entities will not directly or indirectly use the proceeds of
the offering of the Program Shares hereunder, or lend, contribute or otherwise make available such
proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of
financing the activities of any person currently subject to any U.S. sanctions administered by
OFAC.
ARTICLE IV
COVENANTS
COVENANTS
The Transaction Entities, jointly and severally, covenant and agree during the term of this
Agreement with BNYMCM as follows:
Section 4.01 Registration Statement and Prospectus. (i) To make no amendment or
supplement to the Registration Statement or the Prospectus (other than (x) an amendment or
supplement relating solely to the issuance or offering of securities other than the Program Shares
or (y) by means of a Current Report on Form 8-K filed with the Commission under the Exchange Act
and incorporated or deemed incorporated by reference in the Registration Statement or the
Prospectus; provided, that EQR will give prior written notice to BNYMCM of the intention to file
such report and describing the subject matter to be included in such report as soon as reasonably
practicable prior to the filing of such report) after the date of delivery of an Issuance Notice
and prior to the related Settlement Date if BNYMCM reasonably disapproves such amendment promptly
after reasonable advance notice thereof; (ii) to prepare, with respect to any Issuance Shares to be
sold pursuant to this Agreement, an Issuance Supplement with respect to such Program Shares in a
form previously approved by BNYMCM and to file such Issuance Supplement pursuant to Rule 424(b)
promulgated by the Commission under the Securities Act within the time period required thereby and
to deliver such number of copies of each Issuance Supplement as may be required to each exchange or
market on which such sales were effected, in each case to the extent that delivery and filing of
such an Issuance Supplement is required by applicable law, by the rules and regulations of the
Commission or by the rules of such exchange or market; (iii) to make no amendment or supplement to
the Registration Statement or the Prospectus (other than (x) an amendment or supplement relating
solely to the issuance or offering of securities other than the Program Shares or (y) by means of
an Annual Report on Form 10-K, a Quarterly Report on Form 10-Q, a Current Report on Form 8-K or a
Registration Statement on Form 8A or any amendments to any of the foregoing filed with the
Commission under the Exchange Act and incorporated or deemed incorporated by reference into the
Registration Statement or the
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Prospectus except to the extent required by Section 4.01(i)) at any time prior to having
afforded BNYMCM a reasonable opportunity to review and comment thereon; (iv) to file promptly all
other material required to be filed by EQR with the Commission pursuant to Rule 433(d) under the
Securities Act, (v) to file within the time periods required by the Exchange Act all reports and
any definitive proxy or information statements required to be filed by EQR 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 under the Securities Act or under the blue sky or securities laws of any
jurisdiction in connection with the offering or sale of the Program Shares, and during such same
period to advise BNYMCM, promptly after EQR receives notice thereof, of the time when any amendment
to the Registration Statement has been filed or has become 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
relating to the Program Shares, of the suspension of the qualification of the Program Shares for
offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any
such purpose, of any request by the Commission for the amendment or supplement of the Registration
Statement or the Prospectus or for additional information, or the receipt of any comments from the
Commission with respect to Registration Statement or the Prospectus (including, without limitation,
any documents incorporated by reference therein); and (vi) in the event of the issuance of any such
stop order or of any such order preventing or suspending the use of any such prospectus or
suspending any such qualification during a Selling Period, to use its commercially reasonable
efforts to promptly obtain its withdrawal; in the event any such stop order or such other order is
issued outside a Selling Period, EQR will promptly advise BNYMCM as to the issuance thereof and as
to whether EQR intends to seek to obtain its withdrawal.
If immediately prior to the third anniversary (the “Renewal Deadline”) of the initial
effective date of the Registration Statement, any of the Program Shares remain unsold, EQR will,
prior to the Renewal Deadline, advise BNYMCM as to whether it intends to file (unless it has
already done so) a new automatic shelf registration statement or shelf registration statement, as
applicable, relating to the Program Shares. Following the filing of any such new automatic shelf
registration statement or shelf registration statement, references herein to the Registration
Statement shall be deemed to refer to such new automatic shelf registration statement or such new
shelf registration statement, as the case may be.
Section 4.02 Blue Sky. To use its commercially reasonable efforts to cause the
Program Shares to be listed on the Principal Market, and to maintain such listing, and to promptly
from time to time to take such action as BNYMCM may reasonably request to cooperate with BNYMCM in
the qualification of the Program Shares for offering and sale under the blue sky or securities laws
of such jurisdictions within the United States of America and its territories as BNYMCM may
reasonably request and to use its commercially reasonable efforts to comply with such laws so as to
permit the continuance of sales and dealings therein for as long as may be necessary to complete
the sale of the Program Shares; provided, however, that in connection therewith neither
Transaction Entity shall not be required to qualify as a foreign business entity, to file a general
consent to service of process or to subject itself to taxation in respect of doing business in any
jurisdiction;
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Section 4.03 Copies of Registration Statement and Prospectus. To furnish BNYMCM with
copies (which may be electronic copies) of the Registration Statement and each amendment thereto,
and with copies of the Prospectus and each amendment or supplement thereto in the form in which it
is filed with the Commission pursuant to the Securities Act or Rule 424(b) promulgated by the
Commission under the Securities Act, both in such quantities as BNYMCM may reasonably request from
time to time; and, if the delivery of a prospectus is required under the Securities Act or under
the blue sky or securities laws of any jurisdiction at any time on or prior to the applicable
Settlement Date for any Selling Period in connection with the offering or sale of the Program
Shares and if at such time any event has 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 make the statements therein, in the light of the circumstances
under which they were made when such Prospectus is delivered, not misleading, or, if for any other
reason it is 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 Securities Act or the Exchange Act, to notify BNYMCM and request BNYMCM to suspend offers
to sell Program Shares (and, if so notified, BNYMCM shall cease such offers as soon as
practicable); and, if EQR decides to amend or supplement the Registration Statement or the
Prospectus as then amended or supplemented, to advise BNYMCM promptly by telephone (with
confirmation in writing) and to prepare and cause to be filed promptly with the Commission an
amendment or supplement to the Registration Statement or the Prospectus as then amended or
supplemented that will correct such statement or omission or effect such compliance; provided,
however, that if during such same period BNYMCM is required to deliver a prospectus in respect of
transactions in the Program Shares, EQR shall promptly prepare and file with the Commission such an
amendment or supplement;
Section 4.04 Rule 158. To make generally available to its holders of the Program
Shares 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) promulgated by the Commission under
the Securities Act), an earnings statement of EQR (which need not be audited) complying with
Section 11(a) of the Securities Act and the rules and regulations of the Commission promulgated
thereunder (including the option of EQR to file periodic reports in order to make generally
available such earnings statement, to the extent that it is required to file such reports under
Section 13 or Section 15(d) of the Exchange Act, pursuant to Rule 158 promulgated by the Commission
under the Securities Act);
Section 4.05 Information. To furnish to BNYMCM (in paper or electronic format)
copies of all publicly available reports or other communications (financial or other) furnished
generally to equityholders of EQR and filed with the Commission pursuant to the Exchange Act, and
deliver to BNYMCM (in paper or electronic format) (i) promptly after they are available, copies of
any publicly available reports and financial statements furnished to or filed with the Commission
or any national securities exchange on which any class of securities of EQR are listed; and (ii)
such additional publicly available information concerning the business and financial condition of
EQR as BNYMCM may from time to time reasonably request (such financial statements to be on a
consolidated basis to the extent the accounts of EQR and its subsidiaries are consolidated in
reports furnished to its stockholders generally or to the Commission);
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Section 4.06 Representations and Warranties. At each Representation Date, (i) the
Transaction Entities shall be deemed to have affirmed that each representation, warranty, covenant
and other agreement contained in this Agreement is true and correct, as though made at and as of
each such date, except as may be disclosed in the Prospectus (including any documents incorporated
by reference therein and supplements thereto), and (ii) the Transaction Entities will undertake to
advise BNYMCM if any of such representations and warranties will not be true and correct as of each
such date, as though made at and as of each such date (except that such representations and
warranties shall be deemed to relate to the Registration Statement and the Prospectus as amended
and supplemented relating to such Program Shares);
Section 4.07 Opinions of Counsel. (i) That each time the Registration Statement or
the Prospectus is amended or supplemented (other than by means of (x) an amendment or supplement
relating solely to the offering of securities other than the Program Shares, (y) an Issuance
Supplement or (z) a Current Report on Form 8-K, unless, in the case of (y) or (z) reasonably
requested by BNYMCM within five days of the filing thereof with the Commission), including by means
of an Annual Report on Form 10-K or a Quarterly Report on Form 10-Q filed with the Commission under
the Exchange Act and incorporated or deemed to be incorporated by reference into the Prospectus
(each such date, a “Registration Statement Amendment Date”); or (ii) otherwise after each
reasonable request by BNYMCM (each date of any such request by BNYMCM, an “Opinion Request
Date”), the Transaction Entities shall as soon as practicable thereafter furnish or cause to be
furnished as promptly as practicable thereafter to BNYMCM written opinions and negative assurance
letters (A) of DLA Piper LLP (US), counsel for the Transaction Entities, dated the date of such
amendment, supplement or incorporation and in form reasonably satisfactory to BNYMCM, (B) of the
General Counsel of EQR, dated the date of such amendment, supplement or incorporation and in form
reasonably satisfactory to BNYMCM, and (C) of Xxxxx Lovells US LLP, counsel for BNYMCM and the
Alternative Sales Agents, dated the date of such amendment, supplement or incorporation and in form
reasonably satisfactory to BNYMCM, (1) if such counsel has previously furnished opinions and
negative assurance letters to the effect set forth in Exhibits B, C and D hereto, to the effect
that BNYMCM may rely on such previously furnished opinions and negative assurance letters of such
counsel to the same extent as though they were dated the date of such letter authorizing reliance
(except that the statements in such last opinions and negative assurance letters shall be deemed to
relate to the Registration Statement and the Prospectus as amended and supplemented to such date)
or (2) if such counsel has not previously furnished opinions and negative assurance letters to the
effect set forth in Exhibits B, C and D hereto, of the same tenor as such opinions and negative
assurance letters of such counsel but modified to relate to the Registration Statement, the
Prospectus and the General Disclosure Package (other than the offering price of any Program Shares)
as amended and supplemented to such date; provided, however, that the Transaction Entities shall
have the right in their sole discretion to suspend the delivery of all such opinions and negative
assurance letters otherwise required by this Section 4.07 if the Transaction Entities do not expect
to deliver an Issuance Notice with respect to the Program Shares; provided further, that, in the
event the Transactions Entities have suspended the delivery of such opinions and negative assurance
letters pursuant to the terms of this Section 4.07, the delivery of the opinions and negative
assurance letters required by this Section 4.07, dated as of the date of their delivery, shall be a
condition precedent to the delivery by EQR of an Issuance Notice with respect to the Program
Shares;
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Section 4.08 Comfort Letters. (i) That each time the Registration Statement or the
Prospectus is amended or supplemented, including by means of an Annual Report on Form 10-K, a
Quarterly Report on Form 10-Q or a Current Report on Form 8-K (but only a Current Report on Form
8-K that contains financial statements of EQR filed with the Commission under the Exchange Act and
incorporated or deemed to be incorporated by reference into the Prospectus), other than by an
amendment or supplement relating solely to the offering of securities other than the Program
Shares, in any case to set forth financial information included in or derived from EQR’s financial
statements or accounting records, or (ii) otherwise after each reasonable request by BNYMCM (each
date of any such request by BNYMCM, a “Comfort Letter Request Date”), the Transaction
Entities shall as soon as practicable thereafter cause the independent registered public accounting
firm who has audited the financial statements of the Transaction Entities included or incorporated
by reference in the Registration Statement to furnish as promptly as practicable thereafter to
BNYMCM a letter, dated the date of such amendment, supplement or incorporation, as the case may be,
in form reasonably satisfactory to the Transaction Entities, of the same tenor as the letter
referred to in Section 5.01(g) hereof but modified to relate to the Registration Statement, the
Prospectus and, to the extent applicable, the General Disclosure Package (other than the offering
price of any Program Shares) as amended or supplemented to the date of such letter, with such
changes as may be necessary to reflect changes in the financial statements and other information
derived from the accounting records of EQR, to the extent such financial statements and other
information are available as of a date not more than five business days prior to the date of such
letter; provided, however, that, with respect to any financial information or other matters, such
letter may reconfirm as true and correct at such date as though made at and as of such date, rather
than repeat, statements with respect to such financial information or other matters made in the
letter referred to in Section 5.01(g) hereof that was last furnished to BNYMCM; provided, however,
that the Transaction Entities shall have the right in their sole discretion to suspend the delivery
of any such letter otherwise required by this Section 4.08 if EQR does not expect to deliver an
Issuance Notice with respect to the Program Shares; provided further, that, in the event
the Transactions Entities have suspended the delivery of such letter pursuant to the terms of this
Section 4.08, the delivery of the letter required by this Section 4.08, dated as of the date of its
delivery, shall be a condition precedent to the delivery by EQR of an Issuance Notice with respect
to the Program Shares;
Section 4.09 Officer’s Certificate. (i) That each time the Registration Statement or
the Prospectus is amended or supplemented (other than by an amendment or supplement relating solely
to the offering of securities other than the Program Shares, an Issuance Supplement or a Current
Report on Form 8-K, unless reasonably requested by BNYMCM within five days of the filing thereof
with the Commission), including by means of an Annual Report on Form 10-K or a Quarterly Report on
Form 10-Q filed with the Commission under the Exchange Act and incorporated or deemed to be
incorporated by reference into the Prospectus, or (ii) otherwise after each reasonable request by
BNYMCM (each date of any such request by BNYMCM, an “Officer’s Certificate Request Date”),
the Transaction Entities shall as soon as practicable thereafter furnish or cause to be furnished
as promptly as practicable thereafter to BNYMCM a certificate, dated the date of such supplement,
amendment or incorporation, as the case may be, in such form and executed by such officers of EQR
as is reasonably satisfactory to BNYMCM, of the same tenor as the certificate referred to in
Section 2.02(ii) but modified to relate to the Registration Statement, the Prospectus and the
General Disclosure Package (other than the offering price of any Program
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Shares) as amended and supplemented to such date; provided, however, that the Transaction
Entities shall have the right in their sole discretion to suspend the delivery of any such
certificate otherwise required by this Section 4.09 if EQR does not expect to deliver an Issuance
Notice with respect to the Program Shares; provided further, that, in the event the Transactions
Entities have suspended the delivery of the certificate pursuant to the terms of this Section 4.09,
the delivery of such certificate required by this Section 4.09, dated as of the date of its
delivery, shall be a condition precedent to the delivery by EQR of an Issuance Notice with respect
to the Program Shares;
Section 4.10 Stand Off Agreement. Without the written consent of BNYMCM, EQR will
not, directly or indirectly, offer to sell, sell, contract to sell, grant any option to sell or
otherwise dispose of any Common Shares or securities convertible into or exchangeable for Common
Shares (other than Program Shares hereunder), warrants or any rights to purchase or acquire, Common
Shares during the period beginning on the first (1st) Trading Day immediately prior to the date on
which any Issuance Notice is delivered to BNYMCM hereunder and ending on the first (1st) Trading
Day immediately following the Settlement Date with respect to Program Shares sold pursuant to such
Issuance Notice (each a “Stand Off Period”); provided, however, that such restriction will
not be required in connection with EQR’s issuance or sale of (i) Common Shares, options to purchase
shares of Common Shares or Common Shares issuable upon the exercise of options pursuant to any
current or future employee or director stock option, incentive or benefit plan, employee stock
purchase, long-term incentive plan, deferred compensation plan or ownership plan or dividend
reinvestment plan (but not shares subject to a waiver to exceed plan limits in its stock purchase
plan) of the Transaction Entities, (ii) Common Shares issuable upon conversion of securities or the
exercise of warrants, options or other rights disclosed in EQR’s Commission filings and (iii)
Common Shares or limited partnership interests in ERP issuable as consideration in connection with
acquisitions of business, assets or securities of other Persons. The settlement of Program Shares
which have been sold pursuant to the Alternative Sales Agency Agreements are permitted pursuant to
this Section 4.10 without the consent of BNYMCM;
Section 4.11 Market Activities. The Transaction Entities will not, directly or
indirectly, (i) take any action designed to cause or result in, or that constitutes or might
reasonably be expected to constitute, the stabilization or manipulation of the price of any
security of EQR to facilitate the sale or resale of the Program Shares or (ii) during any Stand Off
Period sell, bid for or purchase the Program Shares, or pay anyone any compensation for soliciting
purchases of the Program Shares other than BNYMCM;
Section 4.12 Prospectus Supplement Filing; Periodic Reports. Promptly following the
end of each quarterly period, EQR shall be required to file a prospectus supplement with the
Commission, disclosing the number of Program Shares sold through BNYMCM and the Alternative Sales
Agents under the Sales Agency Agreements and the net proceeds received by EQR with respect to sales
of the Program Shares pursuant to the Sales Agency Agreements relating to such quarter, together
with any other information that EQR reasonably believes is required to comply with the Securities
Act or any rules or regulations thereunder. In the alternative, to the extent permitted by the
rules and regulations of the Commission, EQR in its sole discretion may make the disclosures
contemplated by the preceding sentence by including such disclosures in its Annual Report on Form
10-K or Quarterly Report on Form 10-Q filed by EQR
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for any quarter in which sales of Program Shares were made by or through BNYMCM and the Alternative Sales
Agents under the Sales Agency Agreements;
Section 4.13 Maximum Program Amount. EQR will promptly notify BNYMCM and the
Alternative Sales Agents when the Maximum Program Amount has been sold pursuant to the Sales Agency
Agreements; and
Section 4.14 Due Diligence. EQR shall promptly reply to due diligence inquiries from
or on behalf of BNYMCM, including, without limitation, furnishing requested materials and making
senior management available for due diligence conference calls, upon the reasonable request of on
behalf of BNYMCM.
ARTICLE V
CONDITIONS TO DELIVERY OF ISSUANCE
NOTICES AND TO SETTLEMENT
CONDITIONS TO DELIVERY OF ISSUANCE
NOTICES AND TO SETTLEMENT
Section 5.01 Conditions Precedent to the Right of EQR to Deliver an Issuance Notice and
the Obligation of BNYMCM to Sell Program Shares During the Selling Period(s). The right of EQR
to deliver an Issuance Notice hereunder is subject to the satisfaction, on the date of delivery of
such Issuance Notice, and the obligation of BNYMCM to sell Program Shares during the applicable
Selling Period is subject to the satisfaction, on the applicable Settlement Date, of each of the
following conditions:
(a) Effective Registration Statement and Authorizations. The Registration Statement
shall remain effective, and the Prospectus Supplement shall have been filed with the Commission
pursuant to Rule 424(b) under the Securities Act on or prior to the date hereof, any other material
required to be filed by EQR pursuant to Rule 433(d) under the Securities Act shall have been filed
with the Commission within the applicable time periods prescribed for such filings by Rule 433, and
sales of all of the Program Shares (including all of the Issuance Shares issued with respect to all
prior Issuances and all of the Issuance Shares expected to be issued in connection with the
Issuance specified by the current Issuance Notice) may be made by BNYMCM thereunder, and (i) no
stop order suspending the effectiveness of the Registration Statement shall have been issued and no
proceeding for that purpose shall have been initiated or, to the knowledge of the Transaction
Entities, threatened by the Commission; (ii) no other suspension of the use or withdrawal of the
effectiveness of the Registration Statement or Prospectus shall exist; (iii) all requests for
additional information on the part of the Commission shall have been complied with to the
reasonable satisfaction of BNYMCM and (iv) no event specified in Section 4.03 hereof shall have
occurred and be continuing without EQR amending or supplementing the Registration Statement or the
Prospectus as provided in Section 4.03. The authorizations referred to in Section 3.10, Section
3.12, Section 3.18, and Section 3.25 of this Agreement shall have been issued and shall be in full
force and effect, and such authorizations shall not be the subject of any pending or, to the
knowledge of the Transaction Entities, threatened application for rehearing or petition for
modification, and are sufficient to authorize the issuance and sale of the Program Shares.
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(b) Accuracy of Representations and Warranties. The representations and warranties of
the Transaction Entities shall be true and correct as of each Applicable Time, as of
the Closing Date, as of the applicable date referred to in Section 4.09 that is prior to such
Issuance Date or Settlement Date, as the case may be, and as of such Issuance Date and Settlement
Date as though made at such time.
(c) Performance by the Transaction Entities. The Transaction Entities shall have
performed, satisfied and complied in all material respects with all covenants, agreements and
conditions required by this Agreement to be performed, satisfied or complied with by the
Transaction Entities, or either of them, at or prior to such date.
(d) No Injunction. No statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction or any self-regulatory organization having authority over the
matters contemplated hereby that prohibits or directly and materially adversely affects any of the
transactions contemplated by this Agreement, and no proceeding shall have been commenced that may
have the effect of prohibiting or materially adversely affecting any of the transactions
contemplated by this Agreement.
(e) Material Adverse Effect. Since the date of this Agreement, no event that had or
is reasonably likely to have a Material Adverse Effect shall have occurred that has not been
disclosed in the Registration Statement, the Prospectus or the General Disclosure Package
(including the documents incorporated by reference therein and any supplements thereto).
(f) No Suspension of Trading In or Delisting of Common Shares; Other Events. The
trading of the Common Shares (including without limitation the Issuance Shares) shall not have been
suspended by the Commission, the Principal Market or the Financial Industry Regulatory Authority
since the immediately preceding Settlement Date or, if there has been no Settlement Date, the
Closing Date, and the Program Shares (including without limitation the Issuance Shares) shall have
been approved for listing or quotation on and shall not have been delisted from the Principal
Market. There shall not have occurred (and be continuing in the case of occurrences under clauses
(i) and (ii) below) any of the following: (i) if trading generally on the American Stock Exchange,
the New York Stock Exchange, the Pacific Stock Exchange or The Nasdaq Stock Market has been
suspended or materially limited, or minimum and maximum prices for trading have been fixed, or
maximum ranges for prices have been required, by any of said exchanges or by such system or by
order of the Commission, the Financial Industry Regulatory Authority or any other governmental
authority, or a material disruption has occurred in commercial banking or securities settlement or
clearance services in the United States; (ii) a general moratorium on commercial banking activities
in New York declared by either federal or New York state authorities; or (iii) any material
adverse change in the financial markets in the United States or in the international financial
markets, any outbreak or escalation of hostilities or other calamity or crisis involving the United
States or the declaration by the United States of a national emergency or war or any change or
development involving a prospective change in national or international political, financial or
economic conditions, if the effect of any such event specified in this clause (iii) in the sole
judgment of BNYMCM makes it impracticable or inadvisable to proceed with the sale of the Program
Shares.
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(g) Comfort Letter. On the Closing Date and on each applicable date referred to in
Section 4.08 hereof that is on or prior to such Issuance Date or Settlement Date, as the case may
be, the independent registered public accounting firm who has audited the financial statements of
EQR included or incorporated by reference in the Registration Statement shall have furnished to
BNYMCM a letter, dated the Closing Date or such applicable date, as the case may be, in form and
substance satisfactory to BNYMCM to the effect required by Section 4.08.
(h) No Defaults. The execution and delivery of this Agreement and the issuance and
sale of the Program Shares and the compliance by the Transaction Entities with all of the
provisions of this Agreement will not result in either of the Transaction Entities being in default
of (whether upon the passage of time, the giving of notice or both) its organizational and other
governing documents, or any provision of any security issued by either of the Transaction Entities,
or of any agreement, instrument or other undertaking to which either of the Transaction Entities is
a party or by which it or any of its property or assets is bound, or the applicable provisions of
any law, statute, rule, regulation, order, writ, injunction, judgment or decree of any court or
governmental authority to or by which the Transaction Entities or any of their property or assets
is bound, in each case which default, either individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
(i) Trading Cushion. The Selling Period for any previous Issuance Notice shall have
expired.
(j) Maximum Issuance Amount. In no event may EQR issue an Issuance Notice to sell an
Issuance Amount to the extent that the sum of (x) the number of Program Shares requested to be sold
under the Issuance Notice, plus (y) the number of all Program Shares issued under all previous
Issuances effected pursuant to this Agreement, together with the aggregate number of Program Shares
issued under the Alternative Sales Agency Agreements, would exceed the Maximum Program Amount.
(k) Prospectus Supplement and Issuance Supplement.
(1) A supplement to the prospectus included in the Registration Statement (the
“Prospectus Supplement”), in form and substance to be agreed upon by the parties
hereto, setting forth information regarding this Agreement including, without limitation,
the Maximum Program Amount, shall have been filed with the Commission pursuant to Rule
424(b) promulgated by the Commission under the Securities Act within the time period
required thereby and sufficient copies thereof delivered to BNYMCM on or prior to the
Issuance Date.
(2) To the extent required by Section 4.01(ii), an Issuance Supplement, in form and
substance to be agreed upon by the parties, shall have been filed with the Commission
pursuant to Rule 424(b) promulgated by the Commission under the Securities Act within the
time period required thereby and sufficient copies thereof delivered to BNYMCM on or prior
to the Issuance Date.
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(l) Counsel Letters. The counsel specified in Section 4.07, or other counsel selected
by the Transaction Entities and reasonably satisfactory to BNYMCM shall have furnished to BNYMCM
their written opinions, dated the Closing Date and each applicable date referred to in Section 4.07
hereof that is on or prior to such Issuance Date or Settlement Date, as the case may be, to the
effect required by Section 4.07.
(m) Officers’ Certificate. The Transaction Entities shall have furnished or caused to
be furnished to BNYMCM an officers’ certificate executed by the Chief Executive Officer, the
President or any Senior Vice President of EQR and by the Chief Financial Officer of EQR, signing in
their respective capacities, dated the Closing Date and each applicable date referred to in Section
4.09 hereof that is on or prior to such Issuance Date or Settlement Date, as the case may be, as to
the matters specified in Section 2.02(ii).
(n) Listing. The Program Shares shall have received approval for listing on the
Principal Market prior to the first Settlement Date.
(o) Other Documents. On the Closing Date and prior to each Issuance Date and
Settlement Date, BNYMCM and its counsel shall have been furnished with such documents as they may
reasonably require in order to evidence the accuracy and completeness of any of the representations
or warranties, or the fulfillment of the conditions, herein contained; and all proceedings taken by
the Transaction Entities in connection with the issuance and sale of the Program Shares as herein
contemplated shall be satisfactory in form and substance to BNYMCM and its counsel.
(p) Commission Filings. All filings with the Commission required by Rule 424 under
the Securities Act to have been filed by each applicable Issuance Date or Settlement Date shall
have been made within the applicable time period prescribed for such filing by Rule 424 (without
reliance on Rule 424(b)(8)).
Section 5.02 Documents Required to be Delivered on each Issuance Date. BNYMCM’s
obligation to sell Program Shares pursuant to an Issuance hereunder shall additionally be
conditioned upon the delivery to BNYMCM on or before the Issuance Date of a certificate in form and
substance reasonably satisfactory to BNYMCM, executed by the Chief Executive Officer, the President
or the Chief Financial Officer of EQR, to the effect that all conditions to the delivery of such
Issuance Notice shall have been satisfied as at the date of such certificate (which certificate
shall not be required if the foregoing representations shall be set forth in the Issuance Notice).
Section 5.03 Suspension of Sales. EQR or BNYMCM may, upon notice to the other party
in writing or by telephone (confirmed promptly in writing), suspend any sale of Issuance Shares,
and the Selling Period shall immediately terminate; provided, however, that such suspension and
termination shall not affect or impair either party’s obligations with respect to any Issuance
Shares sold hereunder prior to the receipt of such notice. EQR agrees that no such notice shall be
effective against BNYMCM unless it is made to one of the individuals named on Schedule 1 hereto, as
such Schedule may be amended from time to time. BNYMCM agrees that no such notice shall be
effective against EQR unless it is made to one of the individuals named on Schedule 1 annexed
hereto, as such Schedule may be amended from time to time.
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ARTICLE VI
INDEMNIFICATION AND CONTRIBUTION
INDEMNIFICATION AND CONTRIBUTION
Section 6.01 Indemnification by the Transaction Entities. Each of EQR and ERP hereby
agrees, jointly and severally, to indemnify and hold harmless BNYMCM and each person, if any, who
controls BNYMCM within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, and any director, officer, employee or affiliate thereof, as follows:
(i) against any and all loss, liability, claim, damage and expense whatsoever,
as incurred, arising out of any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (or any amendment thereto), or
the omission or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact contained in the
Prospectus (or any amendment or supplement thereto), the Prospectus Supplement, any
Issuer Free Writing Prospectus or any “issuer information” filed or required to be
filed pursuant to Rule 433(d) under the Securities Act, or the omission, or alleged
omission therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and expense whatsoever,
as incurred, to the extent of the aggregate amount paid in settlement of any
litigation or of any investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission, provided
that (subject to Section 6.03 below) any such settlement is effected with the
written consent of EQR; and
(iii) against any and all expense whatsoever as incurred (including, without
limitation, the fees and other charges of counsel chosen by you) reasonably incurred
in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the extent that any
such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent such loss, liability, claim, damage or expense
arises out of any untrue statement or omission or alleged untrue statement or omission made in the
Registration Statement (or any amendment thereto), the Prospectus (or any amendment or supplement
thereto), the Prospectus Supplement, any Issuer Free Writing Prospectus or any “issuer information”
filed or required to be filed pursuant to Rule 433(d) under the Securities Act, in reliance upon
and in conformity with written information furnished to EQR by BNYMCM expressly for use in the
Registration Statement (or any amendment thereto), the Prospectus (or any amendment or
- 29 -
supplement thereto), the Prospectus Supplement, any Issuer Free Writing Prospectus or any “issuer
information” filed or required to be filed pursuant to Rule 433(d) under the Securities Act.
Section 6.02 Indemnification by BNYMCM. BNYMCM agrees to indemnify and hold harmless
each of EQR and ERP, and each person, if any, who controls EQR or ERP within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act, and any trustee, director, officer,
employee or affiliate thereof, against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this Section 6.02, as incurred; but only
with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in
the Registration Statement (or any amendment thereto), the Prospectus (or any amendment or
supplement thereto), the Prospectus Supplement, any Issuer Free Writing Prospectus or any “issuer
information” filed or required to be filed pursuant to Rule 433(d) under the Securities Act, in
reliance upon, and in conformity with, written information furnished to EQR by BNYMCM expressly for
use in the Registration Statement (or any amendment thereto), the Prospectus (or any amendment or
supplement thereto), the Prospectus Supplement, any Issuer Free Writing Prospectus or any “issuer
information” filed or required to be filed pursuant to Rule 433(d) under the Securities Act.
Section 6.03 Conduct of Indemnification Proceedings. (a) Each indemnified party
shall give notice as promptly as reasonably practicable to each indemnifying party of any action
commenced against it in respect of which indemnity may be sought hereunder, but failure to so
notify an indemnifying party shall not relieve such indemnifying party from any liability hereunder
to the extent it is not materially prejudiced as a result thereof and in any event shall not
relieve it from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6.01 above, counsel to the
indemnified parties shall be selected by BNYMCM, and, in the case of parties indemnified pursuant
to Section 6.02 above, counsel to the indemnified parties shall be selected by EQR. An
indemnifying party may participate at its own expense in the defense of any such action provided,
however, that counsel to the indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party. In no event shall the indemnifying
parties be liable for fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior written consent of
the indemnified parties, settle or compromise or consent to the entry of any judgment with respect
to any litigation, or any investigation or proceeding by any governmental agency or body, commenced
or threatened, or any claim whatsoever in respect of which indemnification or contribution could be
sought under Section 6.01, Section 6.02 or Section 6.04 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability arising out of such
litigation, investigation, proceeding or claim and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
(b) If at any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees
that it shall be liable for any settlement of the nature contemplated by Section 6.01(ii)
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effected without its written consent if (i) such settlement is entered into more than 45 days
after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party
shall have received notice of the terms of such settlement at least 30 days prior to such
settlement being entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such settlement.
Section 6.04 Contribution. If the indemnification provided for in Section 6.01 and
Section 6.02 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount of such losses,
liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i) in
such proportion as is appropriate to reflect benefits received by EQR, on the one hand, and BNYMCM,
on the other hand, from the offering of the Program Shares to which such losses, liabilities,
claims, damages or expenses relate or (ii) if the allocation provided by clause (i) is not
permitted by applicable law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of EQR, on the one hand, and
of BNYMCM, on the other hand, in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant equitable
considerations. The relative benefits received by EQR on the one hand and BNYMCM on the other
shall be deemed to be in the same proportion as the total net proceeds from the offering of Program
Shares (before deducting expenses) received by EQR bear to the total commissions received by
BNYMCM.
The relative fault of EQR, on the one hand, and BNYMCM, on the other hand, shall be determined
by reference to, among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates to information
supplied by EQR or by BNYMCM and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
EQR and BNYMCM agree that it would not be just and equitable if contribution pursuant to this
Section 6.04 were determined by pro rata allocation or by any other method of allocation which does
not take account of the equitable considerations referred to above in this Section 6.04. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified
party and referred to above in this Section 6.04 shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 6.04, BNYMCM shall not be required to
contribute any amount in excess of the amount by which the total price at which the Program Shares
sold by it were sold to the public exceeds the amount of any damages which BNYMCM has otherwise
been required to pay by reason of any such untrue or alleged untrue statement or omission or
alleged omission.
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No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the
0000 Xxx) shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
For purposes of this Section 6.04, each person, if any, who controls BNYMCM within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution as BNYMCM, and each trustee, each officer of EQR who signed the Registration
Statement, and each person, if any, who controls EQR or ERP within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to contribution as EQR.
ARTICLE VII
TERMINATION
TERMINATION
Section 7.01 Term. Subject to the provisions of this Article VII, the term of this
Agreement shall run until the end of the Commitment Period.
Section 7.02 Termination by BNYMCM. BNYMCM may, in its sole discretion at any time,
terminate the right of EQR to effect any Issuances under this Agreement, but any such termination
shall not affect the settlement of any sales of Issuance Shares made pursuant to any Issuance
Notice given prior to receipt by the applicable party of notice of such termination.
Section 7.03 Termination by EQR. EQR may, in its sole discretion at any time,
terminate this Agreement, but any such termination shall not affect the settlement of any sales of
Issuance Shares made pursuant to any Issuance Notice give prior to receipt by the applicable party
of notice of such termination.
Section 7.04 Liability; Provisions that Survive Termination. If this Agreement is
terminated pursuant to this Article VII, such termination shall be without liability of any party
hereto to any other party hereto except as provided in Section 9.02 and for EQR’s obligations in
respect of all prior Issuance Notices, and provided further that in any case the provisions of
Article VI, Article VIII and Article IX shall survive termination of this Agreement without
limitation.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES TO SURVIVE DELIVERY
REPRESENTATIONS AND WARRANTIES TO SURVIVE DELIVERY
All representations and warranties of the Transaction Entities herein or in certificates
delivered pursuant hereto shall remain operative and in full force and effect regardless of (i) any
investigation made by or on behalf of BNYMCM and its Affiliates, officers, directors, employees and
agents, (ii) delivery and acceptance of the Program Shares and payment therefor or (iii) any
termination of this Agreement.
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ARTICLE IX
MISCELLANEOUS
MISCELLANEOUS
Section 9.01 Press Releases and Disclosure. EQR may issue a press release describing
the material terms of the transactions contemplated hereby as soon as practicable following the
Closing Date, and may file with the Commission a Current Report on Form 8-K describing the material
terms of the transactions contemplated hereby, and EQR shall consult with BNYMCM prior to making
such disclosures, and the parties shall use all commercially reasonable efforts, acting in good
faith, to agree upon a text for such disclosures that is reasonably satisfactory to all parties.
No party hereto shall issue thereafter any press release or like public statement (including,
without limitation, any disclosure required in reports filed with the Commission pursuant to the
Exchange Act) related to this Agreement or any of the transactions contemplated hereby that
includes information related to this Agreement or transactions contemplated hereby that has not
previously been disclosed without the prior written approval of the other party hereto, except as
may be necessary or appropriate in the opinion of the party seeking to make disclosure to comply
with the requirements of applicable law or stock exchange rules. If any such press release or like
public statement is so required, the party making such disclosure shall consult with the other
party prior to making such disclosure, and the parties shall use all commercially reasonable
efforts, acting in good faith, to agree upon a text for such disclosure that is reasonably
satisfactory to all parties.
Section 9.02 Expenses. (a) The Transaction Entities covenant and agree with BNYMCM
that the Transaction Entities shall pay or cause to be paid the following: (i) the fees,
disbursements and expenses of EQR’s counsel and accountants in connection with the preparation,
printing and filing of the Registration Statement, the Prospectus and any Issuance Supplements and
all other amendments and supplements thereto and the mailing and delivering of copies thereof to
BNYMCM and the Principal Exchanges; (ii) the cost of printing, preparing or reproducing this
Agreement and any other documents in connection with the offering, purchase, sale and delivery of
the Program Shares; (iv) all filing fees and expenses (other than those expenses described in
clause (ii) above) in connection with the qualification of the Program Shares for offering and sale
under state securities laws as provided in Section 4.02 hereof; (v) the cost of preparing the
Program Shares; (vi) the fees and expenses of any transfer agent of EQR; (vii) the cost of
providing any CUSIP or other identification numbers for the Program Shares; (viii) the fees and
expenses incurred in connection with the listing or qualification of the Program Shares on the
Principal Markets and any filing fees incident to any required review by the Financial Industry
Regulatory Authority of the terms of the sale of the Program Shares in connection with this
Agreement and the Registration Statement (including the reasonable fees, disbursements and expenses
of counsel for BNYMCM), and (ix) all other costs and expenses incident to the performance of
Transaction Entities’ obligations hereunder that are not otherwise specifically provided for in
this Section.
(b) If an aggregate of 1,000,000 Program Shares have not been offered and sold under this
Agreement, together with the Program Shares offered and sold under the Alternative Sales Agency
Agreements, by the second anniversary of the date of this Agreement (or such earlier date on which
the parties terminate this Agreement), EQR shall reimburse BNYMCM for its
- 33 -
reasonable out-of-pocket
expenses, including the reasonable fees and disbursements of a single
counsel for BNYMCM and the Alternative Sales Agents, incurred by it in connection with the
offering contemplated by this Agreement.
Section 9.03 Notices. All notices, demands, requests, consents, approvals or other
communications required or permitted to be given hereunder or that are given with respect to this
Agreement shall be in writing and shall be personally served or deposited in the mail, registered
or certified, return receipt requested, postage prepaid or delivered by reputable air courier
service with charges prepaid, or transmitted by hand delivery or facsimile, addressed as set forth
below, or to such other address as such party shall have specified most recently by written notice:
(i) if to either of the Transaction Entities to: c/o Equity Residential, Xxx Xxxxx Xxxxxxxxx Xxxxx,
Xxxxxxx, Xxxxxxxx 00000, Attention Chief Financial Officer, Facsimile No.: (000) 000-0000, with
copies (which shall not constitute notice) to: c/o Equity Residential, Xxx Xxxxx Xxxxxxxxx Xxxxx,
Xxxxxxx, Xxxxxxxx 00000, Attention General Counsel, Facsimile No.: (000) 000-0000, and to: DLA
Piper LLP (US), 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000-0000, Attention Xxx
X. Xxxxx, Facsimile No.: (000) 000-0000, and Xxxxxxx X. Xxxxx, Facsimile No.: (000) 000-0000; and
(ii) if to BNYMCM, 00 Xxx Xxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Equity Capital
Markets, with copies (which shall not constitute notice) to The Bank of New York Mellon, Xxx Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Legal Department, and to: Xxxxx Lovells US LLP, 000
00xx Xxxxxx XX, Xxxxxxxxxx, XX, Attention Xxxxx X. Xxxxxxx, Facsimile No.: (000)
000-0000. Except as set forth in Section 5.03, notice shall be deemed given on the date of service
or transmission if personally served or transmitted by confirmed facsimile. Notice otherwise sent
as provided herein shall be deemed given on the third business day following the date mailed or on
the next business day following delivery of such notice to a reputable air courier service for next
day delivery.
Section 9.04 Entire Agreement. This Agreement constitutes the entire agreement of the
parties with respect to the subject matter hereof and supersedes all prior and contemporaneous
agreements, representations, understandings, negotiations and discussions between the parties,
whether oral or written, with respect to the subject matter hereof.
Section 9.05 Amendment and Waiver. This Agreement may not be amended, modified,
supplemented, restated or waived except by a writing executed by the party against which such
amendment, modification, supplement, restatement or waiver is sought to be enforced. Waivers may
be made in advance or after the right waived has arisen or the breach or default waived has
occurred. Any waiver may be conditional. No waiver of any breach of any agreement or provision
herein contained shall be deemed a waiver of any preceding or succeeding breach thereof nor of any
other agreement or provision herein contained. No waiver or extension of time for performance of
any obligations or acts shall be deemed a waiver or extension of the time for performance of any
other obligations or acts.
Section 9.06 No Assignment; No Third Party Beneficiaries. This Agreement and the
rights, duties and obligations hereunder may not be assigned or delegated by the Transaction
Entities or BNYMCM. Any purported assignment or delegation of rights, duties or obligations
hereunder shall be void and of no effect. This Agreement and the provisions hereof shall be
binding upon and shall inure to the benefit of each of the parties and their respective successors
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and, to the extent provided in Article VI, the controlling persons, officers, directors, employees
and agents referred to in Article VI. This Agreement is not intended to confer any rights or
benefits on any Persons other than as set forth in Article VI or elsewhere in this Agreement.
Section 9.07 Severability. This Agreement shall be deemed severable, and the
invalidity or unenforceability of any term or provision hereof shall not affect the validity or
enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of
any such invalid or unenforceable term or provision, the parties hereto intend that there shall be
added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable
provision as may be possible and be valid and enforceable.
Section 9.08 Further Assurances. Each party hereto, upon the request of any other
party hereto, shall do all such further acts and execute, acknowledge and deliver all such further
instruments and documents as may be necessary or desirable to carry out the transactions
contemplated by this Agreement.
Section 9.09 Titles and Headings. Titles, captions and headings of the sections of
this Agreement are for convenience of reference only and shall not affect the construction of any
provision of this Agreement.
Section 9.10 Governing Law; Jurisdiction. THIS AGREEMENT, AND ANY CLAIM, CONTROVERSY
OR DISPUTE ARISING UNDER OR RELATED TO THIS AGREEMENT, SHALL BE GOVERNED BY, INTERPRETED UNDER AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS
MADE AND TO BE PERFORMED WITHIN THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF
CONFLICTS OF LAWS THEREOF. Any action, suit or proceeding to enforce any provision of, or based on
any matter arising out of or in connection with, this Agreement or the transactions contemplated
hereby shall be brought in any federal court located in the Southern District of the State of New
York or any New York state court located in the Borough of Manhattan, and the Transaction Entities
agree to the exclusive jurisdiction of such courts (and of the appropriate appellate courts
therefrom) and each party waives (to the full extent permitted by law) any objection it may have to
the laying of venue of any such suit, action or proceeding in any such court or that any such suit,
action or proceeding has been brought in an inconvenient forum.
Section 9.11 Waiver of Jury Trial. The Transaction Entities and BNYMCM each hereby
irrevocably waives any right it may have to a trial by jury in respect of any claim based upon or
arising out of this Agreement or any transaction contemplated hereby.
Section 9.12 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which taken together shall
constitute one and the same instrument. Delivery of an executed Agreement by one party to the
other may be made by facsimile transmission.
Section 9.13 Adjustments for Stock Splits, etc. The parties acknowledge and agree
that share related numbers contained in this Agreement (including the minimum Floor Price) shall be
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equitably adjusted to reflect stock splits, stock dividends, reverse stock splits,
combinations and similar events.
Section 9.14 No fiduciary duty. The Transaction Entities acknowledge and agree that
BNYMCM is acting solely in the capacity of an arm’s length contractual counterparty to the
Transaction Entities with respect to the offering of Program Shares contemplated hereby (including
in connection with determining the terms of the offering) and not as a financial advisor or a
fiduciary to, or an agent of, either of the Transaction Entities or any other person and will not
claim that BNYMCM is acting in such capacity in connection with the offering of the Program Shares
contemplated hereby. Additionally, BNYMCM is not advising the Transaction Entities or any other
person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction with
respect to the offering of Program Shares contemplated hereby. The Transaction Entities shall
consult with their own advisors concerning such matters and shall be responsible for making their
own independent investigation and appraisal of the transactions contemplated hereby, and BNYMCM
shall have no responsibility or liability to the Transaction Entities with respect thereto. Any
review by BNYMCM of each of the Transaction Entities, the transactions contemplated hereby or other
matters relating to such transactions will be performed solely for the benefit of BNYMCM and shall
not be on behalf of the Transaction Entities.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Sales Agency Financing Agreement to be
executed by the undersigned, thereunto duly authorized, as of the date first set forth above.
| EQUITY RESIDENTIAL | ||||||||||
| By: | /s/ Xxxxxx Xxxxxxxxx | |||||||||
| Name: | Xxxxxx Xxxxxxxxx | |||||||||
| Title: | First Vice President and Treasurer | |||||||||
| ERP OPERATING LIMITED PARTNERSHIP | ||||||||||
| By: | Equity Residential, its general partner |
|||||||||
| By: | /s/ Xxxxxx Xxxxxxxxx | |||||||||
| Name: | Xxxxxx Xxxxxxxxx | |||||||||
| Title: | First Vice President and Treasurer | |||||||||
| BNY MELLON CAPITAL MARKETS, LLC | ||||||||||
| By: | /s/ Xxxxxx X. xx Xxxxxxx, Xx. | |||||||||
| Name: | Xxxxxx X. xx Xxxxxxx, Xx. | |||||||||
| Title: | Managing Director | |||||||||
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EXHIBIT A
ISSUANCE NOTICE
[DATE]
BNY Mellon Capital Markets, LLC
00 Xxx Xxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
00 Xxx Xxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn:
Reference is made to the Sales Agency Financing Agreement among Equity Residential, a Maryland
real estate trust (“EQR”), ERP Operating Limited Partnership, an Illinois limited
partnership, and BNY Mellon Capital Markets, LLC, dated as of February 3, 2011. EQR confirms that
all conditions to the delivery of this Issuance Notice are satisfied as of the date hereof.
EQR represents and warrants that each representation, warranty, covenant and other agreement
of the Transaction Entities contained in the Sales Agency Financing Agreement is true and correct
on the date hereof, and that the Prospectus and the General Disclosure Package, including the
documents incorporated by reference therein, as of the date hereof, do not contain an untrue
statement of a material fact or omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made, not misleading.
Effective Date of Delivery of Issuance Notice (determined pursuant to Section 2.03(b)):
Number of Days in Selling Period: |
||||
First Date of Selling Period: |
||||
Last Date of Selling Period: |
||||
Settlement Date(s): |
||||
Issuance Amount: |
||||
Selling Commission: |
% |
Floor Price Limitation (Adjustable by EQR during the Selling Period, and in no event less than
$1.00 per share): $ per share
Comments:
A-1
| EQUITY RESIDENTIAL | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
A-2
EXHIBIT B
Form of Corporate Opinion of DLA Piper LLP (US), Counsel for EQR
| Re: | Equity Residential Up to 10,000,000 Common Shares of Beneficial Interest, par value $0.01 per share |
Ladies and Gentlemen:
As special counsel for Equity Residential, a Maryland real estate investment trust (the
“Company”), we address this letter to each of you as the Sales Agents (the “Sales
Agents”) named in each of the four sales agency financing agreements dated February 3, 2011
(the “Sales Agency Financing Agreements”) among each of you individually, the Company and
ERP Operating Limited Partnership, an Illinois limited partnership (the “Operating
Partnership”), with respect to the issuance and sale by the Company through the Sales Agents,
as sales agents, of up to 10,000,000 shares (the “Shares”) of the Company’s common shares
of beneficial interest, par value $0.01 per share (the “Common Shares”). We are delivering
this letter to you at the request of the Company pursuant to [Section 2.02] [Section 4.07] of each
of the Sales Agency Financing Agreements.
The Company has filed with the Securities and Exchange Commission (the “Commission”) a
registration statement on Form S-3 (Registration No. 333-156156) for the registration of the Common
Shares and certain of its other securities under the Securities Act of 1933, as amended (the
“1933 Act”). Such registration statement and the Incorporated Documents (as defined below)
are hereinafter called, collectively and after giving effect to Rule 412 of the 1933 Act
Regulations (as defined below), the “Registration Statement.”
In connection with the issuance and sale of the Common Shares, the Company has prepared (i) a
prospectus dated December 16, 2008 (the “Base Prospectus”) and (ii) a prospectus supplement
dated February 3, 2011 (the “Prospectus Supplement”). The Prospectus Supplement and the
accompanying Base Prospectus, in the form filed with the Commission pursuant to Rule 424(b) of the
1933 Act Regulations, together with the Incorporated Documents, are hereinafter called,
collectively and giving effect to Rule 412 of the 1933 Act Regulations, the “Prospectus.”
As used herein, the term “Incorporated Documents,” when used with respect to the
Registration Statement or the Prospectus as of any date, means the documents incorporated or deemed
to be incorporated by reference in the Registration Statement or the Prospectus, as the case may
be, as of such date pursuant to Item 12 of Form S-3; the term “1933 Act Regulations” means
the rules and regulations of the Commission under the 1933 Act; the term “Title 8” means
Title 8 of the Corporations and Associations Article of the Annotated Code of Maryland; the term
“IL Limited Partnership Act” means the Illinois Uniform Limited Partnership Act (2001); and
the term “Applicable Laws” means (i) Title 8; and (ii) those laws of the State of Illinois
and the State of New York and those federal laws of the United States of America which, in our
experience, are normally applicable to transactions of the type contemplated by the Sales Agency
Financing Agreements (provided that the term “Applicable Laws” shall not include federal or
state securities or blue sky laws, including, without limitation, the 1933 Act, the Securities
Exchange Act of 1934,
B-1
as amended (the “Exchange Act”), and the Investment Company Act of 1940, as amended
(the “1940 Act”), and the respective rules and regulations thereunder or any antifraud laws
or regulations).
As special counsel for the Company, we have examined and relied upon originals or copies,
certified or otherwise identified to our satisfaction, of such agreements, instruments,
certificates, records and other documents as we have deemed necessary or appropriate for the
purpose of rendering the opinions set forth in this letter. In our examination, we have assumed
the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of
all documents submitted to us as originals, the conformity to original documents of all documents
submitted to us as certified or photostatic copies or by facsimile or other means of electronic
transmission or which we obtained from the Commission’s Electronic Data Gathering, Analysis and
Retrieval system (“XXXXX”) or other sites on the internet, and the authenticity of the
originals of such latter documents. As to facts and other matters relevant to the opinions
expressed herein and the other statements made herein, we have relied without independent
investigation or verification upon, and assumed the accuracy and completeness of, (a) certificates,
letters and oral and written statements and representations of public officials, officers and other
representatives of the Company, accountants for the Company, and others, and (b) the
representations and warranties in the Sales Agency Financing Agreements and the Registration
Statement.
Based on and subject to the foregoing and the other limitations, qualifications, exceptions
and assumptions set forth herein, we are of the opinion that:
1. The Company is a real estate investment trust validly existing under and by virtue
of Title 8 and is in good standing with the State Department of Assessments and Taxation of
Maryland.
2. The Operating Partnership is a limited partnership validly existing and in good
standing under the IL Limited Partnership Act.
3. The Company has the real estate investment trust power and authority to own, lease
and operate its properties and to conduct its business as described in the Prospectus and to
execute, deliver and perform its obligations under each of the Sales Agency Financing
Agreements.
4. The Operating Partnership has the limited partnership power and authority to
execute, deliver and perform its obligations under each of the Sales Agency Financing
Agreements.
5. No consent, approval, authorization or order of, or registration or filing with, any
court or other governmental or regulatory authority or agency is required under Applicable
Laws for the execution and delivery by each of the Company and the Operating Partnership of
each of the Sales Agency Financing Agreements or the issuance of the Shares by the Company
pursuant to, or the performance of the obligations of each of the Company and the Operating
Partnership under, each of the Sales Agency Financing Agreements.
B-2
6. Each of the Sales Agency Financing Agreements has been duly authorized, executed and
delivered by each of the Company and the Operating Partnership.
7. The Shares have been duly authorized by the Company for issuance and sale pursuant
to the Sales Agency Financing Agreements. When (i) the purchase price or prices for the
Shares and the number of Shares (in any case not to exceed 10,000,000 in the aggregate) to
be offered and sold from time to time have been duly established and approved by resolutions
duly adopted by the Company’s board of trustees or a duly authorized committee thereof (the
“Board”) and agreed upon by the Company and the respective purchasers of the Shares,
and (ii) the Shares have been issued and delivered by the Company against payment of such
purchase price or prices, as the case may be, in accordance with the relevant Sales Agency
Financing Agreement, after deduction from such purchase price or prices of the Sales Agent’s
commission and such other amounts, if any, as may be deducted therefrom in accordance with
such Sales Agency Financing Agreement and resolutions duly adopted by the Board, the Shares
will be validly issued, fully paid and nonassessable; provided, that (A) the
purchase price per Share paid by purchasers is equal to or in excess of the par value per
Common Share and in excess of any minimum purchase price, and within any other parameters,
established by the Board and (B) the aggregate number of Shares issued and issuable pursuant
to the Sales Agency Financing Agreements, when taken together with the other issued and
outstanding Common Shares (including any treasury shares), does not exceed the number of
authorized Common Shares set forth in the Articles of Restatement of Declaration of Trust of
the Company. The issuance and sale of the Shares pursuant to the Sales Agency Financing
Agreements is not subject to any preemptive rights of any securityholder of the Company
arising under Title 8 as currently in effect or the Articles of Restatement of Declaration
of Trust of the Company or the Seventh Amended and Restated Bylaws of the Company, each as
currently in effect.
8. The Registration Statement became effective under the 1933 Act; the Prospectus has
been filed pursuant to the 1933 Act Regulations; and, to our knowledge, no stop order
suspending the effectiveness of the Registration Statement has been issued under the 1933
Act and no proceedings for that purpose have been instituted or are pending by the
Commission.
9. The Registration Statement, as of the date it first became effective, and the
Prospectus, as of the date of the Prospectus Supplement, each appeared on its face to be
appropriately responsive in all material respects to the applicable requirements of the 1933
Act and the 1933 Act Regulations for registration statements on Form S-3 or related
prospectuses, as the case may be, except in each case that we express no opinion in this
paragraph 9 with respect to (i) financial statements and schedules and other financial or
statistical data derived from financial statements included or incorporated by reference
therein or omitted therefrom and (ii) the Incorporated Documents.
10. The documents incorporated by reference in the Prospectus, at the respective times
such documents were filed with the Commission, each appeared on its
B-3
face to be appropriately responsive in all material respects with the applicable
requirements of the Exchange Act and the rules and regulations of the Commission promulgated
thereunder, except in each case that we express no opinion with respect to financial
statements and schedules and other financial or statistical data derived from financial
statements included or incorporated by reference therein or omitted therefrom.
11. The statements set forth in the Base Prospectus under the heading “Description of
Securities — Description of Shares of Beneficial Interest — Common Shares,” to the extent
such statements purport to describe certain provisions of the Common Shares as set forth in
the Articles of Restatement of Declaration of Trust of the Company as currently in effect,
accurately describe such provisions in all material respects, except that, we express no
opinion in this paragraph 11 to the effect that any Common Shares will be duly authorized,
fully paid and nonassessable.
12. The execution, delivery and performance by each of the Company and the Operating
Partnership of each of the Sales Agency Financing Agreements and the consummation by each of
the Company and the Operating Partnership of the transactions contemplated thereby (i) do
not violate any provision of Applicable Laws, and (ii) do not violate any provision of the
Articles of Restatement of Declaration of Trust of the Company or the Seventh Amended and
Restated Bylaws of the Company or any provision of the Certificate of Limited Partnership of
the Operating Partnership or the Sixth Amended and Restated Agreement of Limited Partnership
of the Operating Partnership, provided that the Shares are issued and sold in
accordance with the proviso to the second sentence of paragraph 7 above, and except that we
express no opinion with respect to any indemnification or contribution provisions contained
in any of the Sales Agency Financing Agreements.
13. The Company is not required to be registered as an “investment company” within the
meaning of the 1940 Act.
In acting as counsel to the Company in connection with the offer and sale of the Shares, we
have participated in conferences with officers and other representatives of the Company,
representatives of the independent public accountants for the Company and your representatives and
counsel, at which conferences certain contents of the Registration Statement and the Prospectus and
related matters were discussed. We have not participated in the preparation of the Registration
Statement or the Base Prospectus; however, we have reviewed such documents. Although we are not
passing upon or assuming responsibility for the accuracy, completeness or fairness of the
statements included or incorporated by reference in or omitted from the Registration Statement, the
Prospectus or the Incorporated Documents and have made no independent check or verification thereof
(except as set forth in paragraph 11 above), based upon our participation in such conferences, no
facts have come to our attention which have caused us to believe that:
(A) the Registration Statement (including the information in the Prospectus that was omitted
from the Registration Statement at the time it first became effective but that is deemed, pursuant
to Rule 430B(f) of the 1933 Act Regulations, to be part of and included in the Registration
Statement), as of the date of the Sales Agency Financing Agreements and at the date
B-4
hereof, included or includes an untrue statement of a material fact or omitted or omits to
state a material fact required to be stated therein or necessary to make the statements therein not
misleading; or
(B) the Prospectus, as of the date hereof, includes an untrue statement of a material fact or
omits to state a material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading;
except in each case that we express no belief and make no statement with respect to financial
statements and schedules and other financial or statistical data derived from the financial
statements included or incorporated by reference in or omitted from the Registration Statement or
the Prospectus.
The foregoing opinions and other statements are subject to the following qualifications,
exceptions, assumptions and limitations:
A. The foregoing opinions and other statements are limited to matters arising under the
federal laws of the United States of America, the laws of the State of Illinois, the laws of the
State of New York and Title 8. We express no opinion and make no statement as to the laws, rules
or regulations of any other jurisdiction or, in the case of Maryland, any other Maryland laws,
rules or regulations, or as to the municipal laws or the laws, rules or regulations of any local
agencies or governmental authorities of or within the State of Illinois or the State of New York,
or in each case as to any matters arising thereunder or relating thereto.
B. In rendering our opinion set forth in paragraphs 1 and 2 above, we have relied solely upon
a certificate or certificates, as the case may be, of a governmental authority or official dated on
or about the date hereof.
C. In rendering our opinion set forth in paragraph 8 above with respect to the effectiveness
of the Registration Statement and the filing of the Prospectus, we have relied upon our review of
the XXXXX website. In rendering our opinion set forth in paragraph 8 above with respect to the
absence of stop orders or proceedings, we have relied solely upon the oral advice of the staff of
the Commission via a telephonic call on the date hereof.
D. In rendering our opinion set forth in paragraph 13 above, we have relied exclusively, as to
all factual matters, on the certificate, dated as of the date of this letter, of Xxxx X. Xxxxxxx,
Executive Vice President and Chief Financial Officer of the Company, and Xxxxx X. Xxxxxx, Executive
Vice President and General Counsel of the Company.
E. Any opinion or statement herein which is expressed to be “to our knowledge” or is otherwise
qualified by words of like import means that the lawyers currently practicing law with the Firm who
have had active involvement in representing the Company in connection with the issuance and sale of
the Shares and our lawyers who have principal responsibility for representing the Company on other
matters in areas relevant to the opinions being rendered or the statements being made, have no
current conscious awareness of any facts or information contrary to such opinion or statement.
Except to the extent expressly set forth in this letter, we have not undertaken any independent
investigation to determine the existence or absence of any fact, and no inference
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as to our knowledge of the existence or absence of any fact should be drawn from our
representation of the Company or the rendering of this letter.
The opinions expressed and the statements made herein are expressed and made on the date
hereof and we assume no obligation to advise you of changes in law, fact or other circumstances (or
the effect thereof on such opinions or statements) that may come to our attention after such time.
We call your attention to the fact that, although we represent the Company in connection with
the subject transaction, our engagement has been limited to the specific matters as to which we
have been consulted.
This letter is being rendered and delivered solely to and for the benefit of the persons to
whom it is addressed; accordingly, it may not be delivered to or relied upon by any other person
(including, without limitation, any person who acquires the Shares from or through any Sales
Agent), quoted or filed with any governmental authority or other regulatory agency or otherwise
circulated or utilized for any other purpose without our prior written consent, except that Xxxxx
Lovells US LLP may rely upon our opinion set forth in paragraph 6 above to the extent that such
opinion relates to the Operating Partnership and matters arising under the laws of the State of
Illinois for the sole purpose of rendering its opinion pursuant to [Section 2.02] [Section 4.07] of
the Sales Agency Financing Agreements.
Very truly yours,
B-6
EXHIBIT C
Form of Tax Opinion of DLA Piper LLP (US), Counsel for EQR
| Re: | Tax Opinion — REIT Status |
Ladies and Gentlemen:
As counsel for Equity Residential, a Maryland real estate investment trust (“EQR”), we address
this letter regarding certain United States federal income tax matters to each of you as the Sales
Agents (the “Sales Agents”) named in each of the four sales agency financing agreements dated
February 3, 2011 (the “Sales Agency Financing Agreements”) between each of you individually, EQR
and ERP Operating Limited Partnership, an Illinois limited partnership (the “Operating
Partnership”), with respect to the issuance and sale by EQR through or to the Sales Agents, as
sales agent, of up to 10,000,000 shares of EQR’s common shares of beneficial interest, par value
$0.01 per share (the “Common Shares”). This letter is being furnished pursuant to [Section 2.02]
[Section 4.07] of each of the Sales Agency Financing Agreements.
EQR has filed with the Securities and Exchange Commission (the “Commission”) a registration
statement on Form S-3 (Registration No. 333-156156) for the registration of the Common Shares and
certain of its other securities under the Securities Act of 1933, as amended (the “1933 Act”),
which registration statement became effective on December 16, 2008. The term “Registration
Statement” shall mean, as of any time referred to herein, such registration statement, as amended
at such time, including, except as otherwise specified therein, the documents incorporated or
deemed to be incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act
as of the date hereof.
In connection with the issuance and sale of the Common Shares, EQR has prepared (i) a
prospectus dated December 16, 2008 (the “Base Prospectus”), and (ii) a prospectus supplement dated
February 3, 2011 (including all Incorporated Documents, the “Prospectus Supplement”), relating to
the Base Prospectus; as used in this letter, the term “Prospectus” shall mean the Base Prospectus
and the Prospectus Supplement, including the Incorporated Documents. As used herein, the term
“Incorporated Documents,” when used with respect to the Registration Statement or Prospectus as of
any date, means the documents incorporated or deemed to be incorporated by reference in the
Registration Statement or the Prospectus, as the case may be, as of such date pursuant to Item 12
of Form S-3.
For purposes of this opinion letter, we have examined copies of the following documents (the
“Reviewed Documents”): (i) the Registration Statement and Prospectus; (ii) the Articles of
Restatement of Declaration of Trust of EQR, dated December 9, 2004 (“Declaration of Trust”); (iii)
the Sixth Amended and Restated Agreement of Limited Partnership of the Operating Partnership (the
“ERP LP Agreement”); and (iv) such other materials and matters as we have deemed necessary for the
issuance of this opinion.
In addition, we have relied upon the factual representations and covenants of EQR and, to the
extent set forth in the Officer’s Certificate (as hereinafter defined), of Multifamily Portfolio
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Partners, Inc., a Delaware corporation, EQR-District Holding, LLC, a Delaware limited liability
company, and BEL Residential Properties Trust, a Maryland real estate investment trust (each such
entity, along with BEL Multifamily Property Trust, a Maryland real estate investment trust, BEL
Communities Property Trust, a Maryland real estate investment trust, and BEL Apartment Properties
Trust, a Maryland real estate investment trust, hereinafter referred to as a “Subsidiary REIT”),
contained in EQR’s certificate to us, dated as of the date hereof (the “Officer’s Certificate”),
executed by a duly appointed officer of EQR setting forth certain representations and covenants
relating to the organization and operation of EQR, the Operating Partnership, the Subsidiary REITs
and their respective subsidiaries.
Although we have made such inquiries and performed such investigations as we have deemed
necessary for purposes of our opinion, we have not independently verified all of the facts,
statements, representations and covenants set forth in the Officer’s Certificate, the Prospectus,
or in any other document. We consequently have assumed that the information presented in such
documents or otherwise furnished to us accurately and completely describes all material facts
relevant to our opinion. We are not aware of any facts that are inconsistent with any of the
representations made to us in the Officer’s Certificate. Any representation or statement in any
document upon which we rely that is made “to the best knowledge of” or otherwise similarly
qualified is assumed to be true, correct and complete as if made without such qualification as to
knowledge or belief. Any alteration or inaccuracy of such facts, statements, representations or
covenants may adversely affect our opinions.
For purposes of our opinion, we have assumed that all of the representations and statements of
a factual nature set forth in the documents we reviewed are true, correct and complete, and all of
the obligations imposed by any such documents on the parties thereto have been and will be
performed or satisfied in accordance with their terms. We have also assumed the legal capacity of
all natural persons, the genuineness of all signatures, the proper execution of all documents, the
authenticity of all documents submitted to us as originals, the conformity to originals of
documents submitted to us as copies, and the authenticity of the originals from which any copies
were made.
The opinions set forth in this letter are based on relevant provisions of the Internal Revenue
Code of 1986, as amended (the “Code”), the regulations promulgated thereunder by the United States
Department of the Treasury (the “Regulations”) (including proposed and temporary Regulations), and
interpretations of the foregoing as expressed in court decisions, legislative history, and existing
administrative rulings and practices of the Internal Revenue Service (“IRS”) (including its
practices and policies in issuing private letter rulings, which are not binding on the IRS except
with respect to a taxpayer that receives such a ruling), all as of the date hereof.
In rendering these opinions, we have assumed that the transactions contemplated by the
Reviewed Documents will be consummated in accordance with the terms and provisions of such
documents, and that such documents accurately reflect the material facts of such transactions. In
addition, the opinions set forth herein are based on the correctness of the following specific
assumptions:
| (i) | EQR, the Operating Partnership, the Subsidiary REITs and their respective subsidiaries will each be operated in the manner described in the Declaration of Trust, the ERP LP Agreement, and the other organizational documents of each such |
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| entity, as the case may be, and all terms and provisions of such agreements and documents will be complied with by all parties thereto; | |||
| (ii) | EQR is a duly formed real estate investment trust under the laws of the State of Maryland; | ||
| (iii) | The Operating Partnership is a duly organized and validly existing limited partnership under the laws of the State of Illinois; and | ||
| (iv) | There will be no change in the applicable laws of the State of Maryland, the State of Illinois, or in the Code, the Regulations, and the interpretations of the Code and such Regulations by the courts and the IRS, after the date of this letter. |
With respect to the last assumption, it should be noted that statutes, regulations, judicial
decisions, and administrative interpretations are subject to change at any time and, in some
circumstances, with retroactive effect. A material change that is made after the date hereof in
any of the foregoing bases for our opinions could affect our conclusions. Furthermore, if the
facts vary from those relied upon (including if any representations, warranties, covenants or
assumptions upon which we have relied are inaccurate, incomplete, breached or ineffective), our
opinion contained herein could be inapplicable.
The qualification and taxation of EQR as a real estate investment trust (“REIT”) under the
Code will depend upon (i) EQR’s meeting, in its actual operations, the applicable asset
composition, source of income, shareholder diversification, distribution and other requirements of
the Code and Regulations necessary for an entity to qualify as a REIT and (ii) the satisfaction by
each of the Subsidiary REITs of the requirements for qualification and taxation as a REIT. We will
not review the operations of EQR or any of the Subsidiary REITs, and no assurance can be given that
the actual operations of EQR or any Subsidiary REIT will meet these requirements or the
representations made to us with respect thereto.
Based upon and subject to the foregoing, it is our opinion that:
| (i) | EQR was organized and has operated in conformity with the requirements for qualification and taxation as a REIT under the Code for each of its taxable years ended December 31, 1992 through December 31, 2010, and EQR’s current organization and proposed method of operation will enable it to continue to meet the requirements for qualification and taxation as a REIT under the Code for its taxable years ending after the date of this opinion. | ||
| (ii) | Although the discussion set forth in the Base Prospectus under the heading “Federal Income Tax Considerations” (as supplemented by the discussion in the Prospectus Supplement under the heading “Supplemental Federal Income Tax Considerations”) does not purport to summarize all possible U.S. federal income tax consequences of the purchase, ownership, and disposition of the Common Shares, such discussion, though general in nature, constitutes, in all material respects, a fair and accurate summary of the material U.S. federal income tax |
C-3
| consequences of the purchase, ownership, and disposition of the Common Shares, subject to the qualifications set forth therein. The U.S. federal income tax consequences of the ownership and disposition of the Common Shares by an investor will depend upon that investor’s particular situation, and we express no opinion as to the completeness of such discussion as applied to any particular holder. |
The foregoing opinion is limited to the matters specifically discussed herein, which are the
only matters to which you have requested our opinion. Other than as expressly stated above, we
express no opinion on any issue relating to EQR or any investment therein, the Operating
Partnership, any Subsidiary REIT, or under any other law.
This opinion should not be construed as or deemed to be a guaranty or insuring agreement. You
should be aware that an opinion of counsel represents only counsel’s best legal judgment, and has
no binding effect or official status of any kind, and that no assurance can be given that the IRS
will not challenge the conclusions of the opinion set forth herein or that any such challenge will
not be successful or that a court considering the issues would not hold contrary to the opinions
set forth herein.
This opinion is rendered only to you pursuant to [Section 2.02] [Section 4.07] of each of the
Sales Agency Financing Agreements, and may not be quoted in whole or in part or otherwise used,
circulated or referred to, or be filed with, or furnished to, any other person or entity
(including, without limitation, any person who acquires the Common Shares from or through the Sales
Agents). This opinion is expressed as of the date hereof, and we are under no obligation to
supplement or revise our opinion to reflect any legal developments or factual matters arising
subsequent to the date hereof, or the impact of any information, document, certificate, record,
statement, representation, covenant, or assumption relied upon herein that becomes incorrect or
untrue.
* * *
To comply with certain Regulations, we inform you that (i) this opinion was written to support
the promotion and marketing by others of the transactions or matters addressed herein, (ii) this
opinion was not intended or written to be used, and cannot be used, by any person for the purpose
of avoiding United States federal tax penalties that may be imposed on such person, and (iii) each
taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent
tax advisor.
* * *
Very truly yours,
C-4
EXHIBIT D
Form of Opinion of Xxxxx X. Xxxxxx, Executive Vice President and
General Counsel of EQR
General Counsel of EQR
| Re: | Equity Residential Up to 10,000,000 Common Shares of Beneficial Interest |
Ladies and Gentlemen:
I am Executive Vice President and General Counsel of Equity Residential, a Maryland real
estate investment trust (the “Company”). I address this letter to each of you as the Sales
Agents (the “Sales Agents”) named in each of the four sales agency financing agreements
dated February 3, 2011 (the “Sales Agency Financing Agreements”) among each of you
individually, the Company and ERP Operating Limited Partnership, an Illinois limited partnership
(the “Operating Partnership”), with respect to the issuance and sale by the Company through
the Sales Agents, as sales agents, of up to 10,000,000 common shares of beneficial interest, par
value $0.01 per share of the Company (the “Common Shares”).
The opinions stated below are based on my participation in the issuance and sale of the
Common Shares and I have relied to the extent I deemed appropriate, as to various questions of fact
material to such opinions, upon the representations made by the Company and the Operating
Partnership in each of the Sales Agency Financing Agreements and upon certificates of officers of
each of the Company and the Operating Partnership. In rendering the opinions expressed below, I am
familiar with the actions taken by the Company in respect thereof and have examined originals or
certified or attested copies of the Articles of Restatement of Declaration of Trust of the Company
and the Seventh Amended and Restated Bylaws of the Company and the charters, limited liability
company agreements, limited partnership agreements and by-laws, as applicable, of the Subsidiaries,
including the Operating Partnership, and such other certificates, records or documents as I have
deemed necessary to enable me to render this opinion letter.
For purposes of this opinion letter, the following terms shall have the following meanings:
“Base Prospectus” shall mean the prospectus dated December 16, 2008 included in
the Registration Statement, including the Incorporated Documents.
“Incorporated Documents” when used with respect to the Registration Statement, or
Prospectus as of any date, means the documents incorporated or deemed to be incorporated by
reference in the Registration Statement or the Prospectus, as the case may be, as of such date
pursuant to Item 12 of Form S-3.
“Prospectus” shall mean the Prospectus Supplement, together with the Base
Prospectus.
D-1
“Prospectus Supplement” shall mean the Company’s prospectus supplement dated
February 3, 2011 (including all Incorporated Documents), specifically relating to the Common
Shares and the Base Prospectus.
“Registration Statement” shall mean, as of any time referred to herein, the
Company’s registration statement on Form S-3 (Registration No. 333-156156 filed with the
Commission on December 16, 2008, which registration statement became effective on December 16,
2008), as amended at such time, including all exhibits thereto (but excluding Form T-1) and the
documents incorporated or deemed to be incorporated by reference therein pursuant to Item 12 of
Form S-3 under the Securities Act and any prospectus supplement relating to the Common Shares
that was filed with the Commission and deemed to be part of and included in the Registration
Statement pursuant to Rule 430B(f)(1) under the Securities Act.
“Securities Act” shall mean the Securities Act of 1933, as amended.
“Subsidiary” shall mean a “significant subsidiary” as defined by Rule 1-02 of
Regulation S-X under the Securities Act.
Capitalized terms not otherwise defined herein are defined as set forth in each of the Sales
Agency Financing Agreements.
Pursuant to the requirements of [Section 2.02] [Section 4.07] of each of the Sales Agency
Financing Agreements, this will advise you that in the opinion of the undersigned:
1. To my knowledge, each of the Company and the Operating Partnership is duly qualified and in
good standing and authorized to transact business in each jurisdiction in which the conduct of its
business or its ownership or leasing of property requires such qualification, except where the
failure to be so qualified or in good standing would not have a Material Adverse Effect.
2. Each of the Company’s Subsidiaries has been duly incorporated or formed and is validly
existing, and in good standing under the laws of the jurisdiction of its incorporation or
formation, has the corporate, limited liability company or limited partnership power and authority
to own, lease and operate its properties and to conduct its business as described in the
Prospectus, and, to my knowledge, is duly qualified and in good standing and authorized to transact
business in any jurisdiction in which the conduct of its business or its ownership or leasing of
property requires such qualification, except where the failure to be validly existing, so qualified
or in good standing would not have a Material Adverse Effect; all of the issued and outstanding
shares of capital stock, limited liability company interests and partnership interests of each
Subsidiary have been duly authorized and validly issued, are, in the case of shares of capital
stock, fully paid, and with respect to the shares of capital stock, limited liability company
interests, and partnership interests of each Subsidiary owned by the Company, the Operating
Partnership or another subsidiary of the Company or the Operating Partnership, are owned by the
Company, the Operating Partnership or another subsidiary of the Company or the Operating
Partnership, to my knowledge, free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity, except where any such security interest, mortgage, pledge, lien,
encumbrance, claim or equity would not have a Material Adverse Effect. None of the outstanding
shares of capital stock,
D-2
limited liability company interests or partnership interests of any Subsidiary were issued in
violation of statutory preemptive rights or, to my knowledge, contractual rights of any security
holder of such Subsidiary to subscribe for more shares of capital stock, limited liability company
interests or partnership interests, except where such violation would not have a Material Adverse
Effect.
3. The execution and delivery by each of the Company and the Operating Partnership of each of
the Sales Agency Financing Agreements, the issuance of the Common Shares by the Company, and the
performance of the obligations of each of the Company and the Operating Partnership, under each of
the Sales Agency Financing Agreements and the consummation by each of the Company and the Operating
Partnership of the transactions contemplated thereby, will not, to my knowledge, conflict with or
constitute a breach of, or default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of its Subsidiaries
pursuant to any material agreement or other instrument that is binding upon the Company or any of
its Subsidiaries, or to which any of their properties or assets is subject.
4. To my knowledge, there are no (A) legal or governmental proceedings pending or threatened
which are required to be disclosed in the Registration Statement or the Prospectus, other than
those disclosed therein, or (B) statutes, regulations, contracts, indentures, mortgages, loan
agreements, notes, leases, instruments or other documents that are required to be described in the
Prospectus or to be filed as exhibits to the Registration Statement that are not described or filed
as required.
5. The statements set forth in the Company’s Annual Report on Form 10-K for the year ended
[December 31, 2009 and the Company’s Quarterly Reports on Form 10-Q for the quarterly periods ended
March 31, 2010, June 30, 2010 and September 30, 2010]1 under the heading
“Legal Proceedings,” insofar as such statements purport to summarize certain legal matters,
documents or proceedings or legal conclusions, to my knowledge, fairly summarize in all material
respects the matters therein described.
This opinion letter is limited to Title 8 of the Corporations and Associations Article of the
Annotated Code of Maryland, those laws of the State of Illinois that are normally applicable to
transactions of the type contemplated by the Sales Agency Financing Agreements and the federal laws
of the United States of America. In rendering my opinions regarding due qualification, valid
existence and good standing set forth in paragraphs 1 and 2 above, I have relied solely upon
certificates of governmental authorities or officials. This opinion letter is based on the law in
effect, and the facts and circumstances existing, on the date of this letter. I assume no
obligation to update or supplement this opinion letter to reflect any facts or circumstances which
may hereafter come to my attention with respect to the opinions and statements expressed above,
including any changes in applicable law which may hereafter occur.
This opinion letter is being rendered and delivered solely to and for the benefit of the
persons to whom it is addressed; accordingly, it may not be delivered to or relied upon by any
other person (including, without limitation, any person who acquires the Common Shares from or
| 1 | To be updated as necessary to reflect most recent periodic filing as of the date of the opinion. |
D-3
through the Sales Agents), quoted or filed with any governmental authority or other regulatory
agency or otherwise circulated or utilized for any other purpose without my prior written consent.
| Very truly yours, |
||||
| Xxxxx X. Xxxxxx Executive Vice President and General Counsel |
||||
D-4
SCHEDULE 1
EQUITY RESIDENTIAL
Xxxxx Xxxxxxxxxx
Title:
|
Chief Executive Officer | |
Telephone:
|
(000) 000-0000 | |
Facsimile:
|
(000) 000-0000 | |
E-mail:
|
xxxxxxxxxxx@xxxxxxxx.xxx | |
Address:
|
Xxx Xxxxx Xxxxxxxxx Xxxxx Xxxxxxx, Xxxxxxxx 00000 |
Xxxx X. Xxxxxxx
Title:
|
Chief Financial Officer | |
Telephone:
|
(000) 000-0000 | |
Facsimile:
|
(000) 000-0000 | |
E-mail:
|
xxxxxxxx@xxxxxxxx.xxx | |
Address:
|
Xxx Xxxxx Xxxxxxxxx Xxxxx Xxxxxxx, Xxxxxxxx 00000 |
Xxxxxx Xxxxxxxxx
Title:
|
Treasurer | |
Telephone:
|
(000) 000-0000 | |
Facsimile:
|
(000) 000-0000 | |
E-mail:
|
xxxxxxxxxx@xxxxxxxx.xxx | |
Address:
|
Xxx Xxxxx Xxxxxxxxx Xxxxx Xxxxxxx, Xxxxxxxx 00000 |
Xxxxxxx Xxxx
Title:
|
Assistant Treasurer | |
Telephone:
|
(000) 000-0000 | |
Facsimile:
|
(000) 000-0000 | |
E-mail:
|
xxxxx@xxxxxxxx.xxx | |
Address:
|
Xxx Xxxxx Xxxxxxxxx Xxxxx Xxxxxxx, Xxxxxxxx 00000 |
[Schedule continued on next page]
S-1
SCHEDULE 1 (Cont’d)
BNYMCM
Xxxxxx X. xx Xxxxxxx, Xx.
Title:
|
Managing Director | |
Telephone:
|
(000) 000-0000 | |
Facsimile:
|
(000) 000-0000 | |
E-mail:
|
xxxxxx.xx.xxxxxxx@xxxxxxxxx.xxx | |
Address:
|
00 Xxx Xxxx, 00xx Xxxxx | |
| Xxx Xxxx, Xxx Xxxx 00000 |
Xxxxxxx X. Xxxxx
Title:
|
Vice President | |
Telephone:
|
(000) 000-0000 | |
Facsimile:
|
(000) 000-0000 | |
E-mail:
|
xxxxxxx.xxxxx@xxxxxxxxx.xxx | |
Address:
|
00 Xxx Xxxx, 00xx Xxxxx | |
| Xxx Xxxx, Xxx Xxxx 00000 |
Xxxxxx Xxxxxxx
Title:
|
Managing Director | |
Telephone:
|
(000) 000-0000 | |
Facsimile:
|
(000) 000-0000 | |
E-mail:
|
xxxxxx.xxxxxxx@xxxxxxxxx.xxx | |
Address:
|
00 Xxx Xxxx, 00xx Xxxxx | |
| Xxx Xxxx, Xxx Xxxx 00000 |
S-2
