EQUITY RESIDENTIAL (NYSE:EQR) Files An 8-K Entry into a Material Definitive Agreement

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EQUITY RESIDENTIAL (NYSE:EQR) Files An 8-K Entry into a Material Definitive Agreement

EQUITY RESIDENTIAL (NYSE:EQR) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.

On June 6, 2019, Equity Residential (the “Company”) and its operating partnership, ERP Operating Limited Partnership (the “Operating Partnership”), entered into a Distribution Agreement (a “Distribution Agreement”) with each of JPMorgan Chase Bank, National Association, London Branch, J.P. Morgan Securities LLC, Barclays Bank PLC, Barclays Capital Inc., Bank of America, N.A., BofA Securities, Inc., The Bank of New York Mellon, BNY Mellon Capital Markets, LLC, Morgan Stanley & Co. LLC, MUFG Securities EMEA plc, MUFG Securities Americas Inc., The Bank of Nova Scotia, Scotia Capital (USA) Inc., UBS AG, London Branch, and UBS Securities LLC, acting in their respective capacity as Agents (as described below), as Forward Sellers (as described below) and/or as Forward Purchasers (as described below), as applicable, with respect to the issuance and sale of up to 13,000,000 common shares of beneficial interest, par value $0.01 per share, of the Company (the “Shares”) from time to time in “at the market” offerings or certain other transactions (the “ATM Program”). The Company refers to these entities, when acting in their capacity as sales agents, individually as an “Agent” and collectively as “Agents.” The Company refers to these entities, when acting as agents for Forward Purchasers (as described below), individually as a “Forward Seller” and collectively as “Forward Sellers.” The 13,000,000 Shares consist of 13,000,000 Shares that remain unsold under the prospectus supplement dated June 29, 2016 to the prospectus dated June 28, 2016, which expired upon the filing of the automatic shelf registration statement discussed below.

The Distribution Agreement provides that, in addition to the issuance and sale of the Shares through the Agents, the Company also may enter into forward sale agreements under separate master forward sale confirmation agreements (each, a “Master Forward Sale Confirmation”) and related supplemental confirmations between the Company and a Forward Seller or its affiliate. The Company refers to these entities, when acting in this capacity, individually as a “Forward Purchaser” and collectively as “Forward Purchasers.” In connection with each particular forward sale agreement, the relevant Forward Purchaser will borrow from third parties and, through the relevant Forward Seller, sell a number of Shares equal to the number of Shares underlying the particular forward sale agreement.

The Company will not initially receive any proceeds from the sale of borrowed Shares by a Forward Seller. The Company expects to fully physically settle each particular forward sale agreement with the relevant Forward Purchaser on one or more dates specified by the Company on or prior to the maturity date of that particular forward sale agreement, in which case the Company will expect to receive aggregate net cash proceeds at settlement equal to the number of Shares underlying the particular forward sale agreement multiplied by the relevant forward sale price. However, the Company may also elect to cash settle or net share settle a particular forward sale agreement, in which case the Company may not receive any proceeds from the issuance of Shares, and the Company will instead receive or pay cash (in the case of cash settlement) or receive or deliver Shares (in the case of net share settlement).

The Distribution Agreement provides that each Agent will receive from the Company a commission that will not exceed, but may be lower than, 2.0% of the gross sales price of all Shares sold through it as Agent under the Distribution Agreement. In connection with each forward sale, the Company will pay the relevant Forward Seller, in the form of a reduced initial forward sale price under the related forward sale agreement with the related Forward Purchaser, commissions at a mutually agreed rate that shall not be more than 2.0% of the gross sales price of all borrowed Shares sold by it as a Forward Seller.

The Shares will be issued to the prospectus supplement filed on June 6, 2019 and the Company’s automatic shelf registration statement on Form S-3 (File No. 333-231967) filed on June 5, 2019 with the Securities and Exchange Commission. This Current Report shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.

The Distribution Agreement and the form of Master Forward Sale Confirmation are filed as Exhibits 1.1 and 1.2, respectively, to this Current Report. The descriptions of the Distribution Agreement and the form of Master Forward Sale Confirmation do not purport to be complete and are qualified in their entirety by reference to the Distribution Agreement and the form of Master Forward Sale Confirmation filed herewith as exhibits to the Current Report.

Item 7.01. Regulation FD Disclosure.

Automatic Shelf Registration & Share Repurchase Program

The automatic shelf registration statement referred to above was filed to replace the Company’s automatic shelf registration that was scheduled to expire on June 28, 2019. The Company also maintains a share repurchase program with authorization for the repurchase of up to 13 million Shares.

Item 9.01. Financial Statements and Exhibits.

(d)    Exhibits.

23.1    Consent of DLA Piper LLP (US) (included in Exhibit 5.1)


EQUITY RESIDENTIAL Exhibit
EX-1.1 2 d759345dex11.htm EX-1.1 EX-1.1 Exhibit 1.1 DISTRIBUTION AGREEMENT June 6,…
To view the full exhibit click here

About EQUITY RESIDENTIAL (NYSE:EQR)

Equity Residential is a real estate investment trust. The Company is focused on the acquisition, development and management of apartment properties in various markets of the United States. The Company’s segments include Boston, New York, San Francisco, Seattle, Southern California, Washington D.C., Non-core – South Florida, Non-core – Denver, and Non-core – other. ERP Operating Limited Partnership (Operating Partnership) conducts the multifamily residential property business of the Company. The Company’s property ownership, development and related business operations are conducted through the Operating Partnership. The Company holds interests in approximately 390 properties located in over 10 states and the District of Columbia, consisting of approximately 109,650 apartment units. Its properties are of various building types, such as garden, mid/high-rise and military housing. Its core properties are located in New York, Los Angeles, Boston, Seattle and San Diego, among others.