As filed with the Securities and Exchange Commission on May 16, 2003
Registration No. 333-104211
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________
AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
__________________________
FIRST INDUSTRIAL REALTY TRUST, INC.
(Exact name of registrant as specified in its charter)
Maryland 36-3935116
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
311 S. Wacker Drive, Suite 4000
Chicago, Illinois 60606
(312) 344-4300
(Address, including zip code, andtelephone number, including
area code, of registrant's principal executive offices)
Michael W. Brennan
President and Chief Executive Officer
First Industrial Realty Trust, Inc.
311 S. Wacker Drive, Suite 4000
Chicago, Illinois 60606
(312) 344-4300
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
Gerald S. Tanenbaum, Esq.
Roger Andrus, Esq.
Cahill Gordon & Reindel
80 Pine Street
New York, New York 10005
(212) 701-3000
__________________________
Approximate date of commencement of proposed sale to the public: From time to
time after the effective date of this registration statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: / /
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering: / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering: / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: / /
CALCULATION OF REGISTRATION FEE
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Proposed Maximum Proposed Maximum
Title of Amount to Offering Price Aggregate Amount of
Securities to be Registered be Registered Per Share Offering Price Registration Fee
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Common Stock, $.01 par value (1) 168,416 shares(2) $28.25 (3) $4,757,752 $405 (4)
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(1) Includes rights to purchase Junior Participating Preferred Stock of First
Industrial Realty Trust, Inc. (the "Company"). Because no separate
consideration is paid for the Rights, the registration fee therefor is
included in the fee for the Common Stock.
(2) Pursuant to Rule 416 under the Securities Act of 1933, as amended (the
"Securities Act"), there are also being registered such additional number
of shares of Common Stock as may be required to be issued under the
anti-dilution provisions of the current limited partnership agreement of
First Industrial, L.P. ("FILP") upon the acquisition by the Company of FILP
limited partnership units in exchange for shares of Common Stock.
(3) Estimated solely for the purposes of computing the registration fee in
accordance with Rule 457(c) under the Securities Act based upon the average
of the reported high and low sales prices on the New York Stock Exchange -
Composite Transactions System on March 28, 2003.
(4) Paid on April 1, 2003.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
PROSPECTUS
FIRST INDUSTRIAL REALTY TRUST, INC.
168,416 Shares
Common Stock
The selling stockholders listed in this prospectus may, from time to time,
offer and sell up to 168,416 shares of our common stock. The purchase price of
any shares of common stock offered by the selling stockholders will be the
market price of a share of common stock at that time unless otherwise indicated
in an accompanying prospectus supplement.
We will receive no proceeds from the sale of the common stock, but will
incur expenses in connection with this offering. See "Plan of Distribution."
You should read both this prospectus and any prospectus supplement together
with the additional information described under "Where You Can Find More
Information" before investing in our common stock.
The common stock of First Industrial Realty Trust, Inc. is listed on the
New York Stock Exchange under the symbol "FR."
Investing in the common stock involves risks that are described in the
"Risk Factors" section beginning on page 4 of this prospectus.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
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The date of this prospectus is May , 2003.
TABLE OF CONTENTS
Page
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FIRST INDUSTRIAL REALTY TRUST, INC............................................3
RISK FACTORS..................................................................4
USE OF PROCEEDS..............................................................12
DESCRIPTION OF COMMON STOCK..................................................16
CERTAIN PROVISIONS OF MARYLAND LAW AND THE FIRST INDUSTRIAL
REALTY TRUST, INC. ARTICLES OF INCORPORATION AND BYLAWS....................17
RESTRICTIONS ON TRANSFERS OF CAPITAL STOCK...................................21
FEDERAL INCOME TAX CONSIDERATIONS............................................22
EXPERTS......................................................................25
LEGAL MATTERS................................................................25
WHERE YOU CAN FIND MORE INFORMATION..........................................25
No dealer, salesperson or other person has been authorized to give any
information or make any representations other than those contained in or
incorporated by reference in this prospectus and any accompanying prospectus
supplement and, if given or made, such other information or representations must
not be relied upon as having been authorized by First Industrial Realty Trust,
Inc. or by any of the Selling Stockholders. This prospectus and any accompanying
prospectus supplement do not constitute an offer to sell, or a solicitation of
an offer to buy, to any person in any jurisdiction where such an offer or
solicitation would be unlawful. Neither the delivery of this prospectus and any
accompanying prospectus supplement nor any sale made hereunder shall, under any
circumstances, create an implication that the information contained herein is
correct as of any time subsequent to the date hereof.
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FIRST INDUSTRIAL REALTY TRUST, INC.
In this prospectus, the terms "we," "our" and "us" refer to First
Industrial Realty Trust, Inc. and its subsidiaries, including First Industrial,
L.P., unless the context otherwise requires. The term "Operating Partnership"
refers to First Industrial, L.P.
First Industrial Realty Trust, Inc. is a real estate investment trust, or
"REIT," subject to Sections 856 through 860 of the Internal Revenue Code of
1986, as amended. First Industrial Realty Trust, Inc. and its consolidated
partnerships, corporations and limited liability companies are a
self-administered and fully integrated real estate company which owns, manages,
acquires, sells and develops industrial real estate.
As of December 31, 2002, our portfolio consisted of the following types of
properties:
o 494 light industrial properties -
Light industrial properties generally are of less than 100,000
square feet, have a ceiling height of 16 to 21 feet, are
comprised of 5% - 50% office space, contain less than 50% of
manufacturing space and have a land use ratio of 4:1. The land
use ratio is the ratio of the total property area to that not
occupied by the building.
o 126 bulk warehouse properties -
Bulk warehouse buildings generally are of more than 100,000
square feet, have a ceiling height of at least 22 feet, are
comprised of 5% - 15% office space, contain less than 25% of
manufacturing space and have a land use ratio of 2:1.
o 167 R&D/flex properties -
R&D/flex buildings generally are of less than 100,000 square
feet, have a ceiling height of less than 16 feet, are comprised
of 50% or more of office space, contain less than 25% of
manufacturing space and have a land use ratio of 4:1.
o 85 regional warehouse properties -
Regional warehouses generally are of less than 100,000 square
feet, have a ceiling height of at least 22 feet, are comprised of
5% - 15% of office space, contain less than 25% of manufacturing
space and have a land use ratio of 2:1.
o 36 manufacturing properties -
Manufacturing properties are a diverse category of buildings that
generally have a ceiling height of 10 - 18 feet, are comprised of
5% - 15% of office
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space, contain more than 50% of manufacturing space and have a
land use ratio of 4:1.
These properties contain approximately 60.0 million square feet of gross
leasable area located in 24 states.
Our interests in our properties and land parcels are held through
partnerships, corporations and limited liability companies controlled by First
Industrial Realty Trust, Inc., including the Operating Partnership, of which
First Industrial Realty Trust, Inc. is the sole general partner.
We utilize an operating approach that combines the effectiveness of
decentralized, locally based property management, acquisition, sales and
development functions with the cost efficiencies of centralized acquisition,
sales and development support, capital markets expertise, asset management and
fiscal control systems. At March 7, 2003, we had 322 employees.
We have grown and will seek to continue to grow through the development of
industrial properties and acquisition of additional industrial properties.
Our fundamental business objective is to maximize the total return to the
stockholders of First Industrial Realty Trust, Inc. through increases in per
share distributions and increases in the value of our properties and operations.
First Industrial Realty Trust, Inc. is a Maryland corporation organized on
August 10, 1993, and which completed its initial public offering in June 1994.
Our principal executive offices are located at 311 S. Wacker Drive, Suite 4000,
Chicago, Illinois 60606, telephone number (312) 344-4300. For more information
about First Industrial Realty Trust, Inc., see the additional information
described in "Where You Can Find More Information."
RISK FACTORS
Forward-looking statements may prove inaccurate.
Your investment in our common stock will involve certain risks. For
example, there is the risk that an investment in our common stock will result in
a loss. You should carefully consider the following discussion of risks before
deciding whether an investment in our common stock is suitable for you. We make
statements in this prospectus and the documents we incorporate by reference that
are not based on historical facts including statements regarding, among other
items:
o the condition of the real estate market;
o legislative or regulatory changes affecting the real estate market;
o legislative or regulatory changes affecting the taxation of REITs;
o availability of capital;
o interest rates;
o competition;
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o supply and demand for industrial properties in our current and
proposed market areas; and
o general accounting principles, policies and guidelines applicable to
REITs.
Sometimes these statements will contain words such as "believes,"
"expects," "intends," "plans" and other similar words. These statements are not
guarantees of our future performance and are subject to risks, uncertainties and
other important factors that could cause our actual performance or achievements
to be materially different from those we anticipate. These risks, uncertainties
and factors include those discussed below and those set forth elsewhere in this
prospectus and in the documents we incorporate by reference, including our 2002
Annual Report on Form 10-K.
Real estate investments' value fluctuates depending on conditions in the general
economy and the real estate business. These conditions may also limit our
revenues and available cash.
The factors that affect the value of our real estate and the revenues we
derive from our properties include, among other things:
o general economic climate;
o local conditions such as oversupply or a reduction in demand in the
area;
o the attractiveness of the properties to tenants;
o tenant defaults;
o zoning or other regulatory restrictions;
o competition from other available real estate;
o our ability to provide adequate maintenance and insurance; and
o increased operating costs, including insurance premiums and real
estate taxes.
Many real estate costs are fixed, even if income from our properties decreases.
Our financial results depend on leasing space in our real estate properties
to tenants on terms favorable to us. In addition, because greater than 90% of
our gross revenues come from rentals of real property, our income and funds
available for distribution to our stockholders will decrease if a significant
number of our tenants cannot pay their rent. If a tenant does not pay its rent,
we might not be able to enforce our rights as landlord without delays and we
might incur substantial legal costs.
Our income may also be reduced if tenants are unable to pay rent or we are
unable to rent properties on favorable terms. Costs associated with real estate
investment, such as real estate taxes and maintenance costs, generally are not
reduced when circumstances cause a reduction in income from the investment.
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We may be unable to sell properties when appropriate because real estate
investments are illiquid.
Real estate investments generally cannot be sold quickly and, therefore,
will tend to limit our ability to vary our property portfolio promptly in
response to changes in economic or other conditions. The inability to respond
promptly to changes in the performance of our property portfolio could adversely
affect our financial condition and ability to service debt and make
distributions to our stockholders.
We may be unable to renew leases or find other lessees.
We are subject to the risks that, upon expiration, leases may not be
renewed, the space subject to such leases may not be relet or the terms of
renewal or reletting, including the cost of required renovations, may be less
favorable than expiring lease terms. If we were unable to promptly renew a
significant number of expiring leases or to promptly relet the space covered by
such leases, or if the rental rates upon renewal or reletting were significantly
lower than the then current rates, our cash funds from operations and ability to
make expected distributions to stockholders might be adversely affected. As of
December 31, 2002, leases with respect to approximately 12,711,346 million,
12,171,402 million and 9,784,258 million square feet, representing 23.7%, 22.7%
and 18.2%, of gross leasable area expire in the remainder of 2003, 2004 and 2005
respectively.
We may incur unanticipated costs and liabilities due to environmental problems.
Under various federal, state and local laws, ordinances and regulations, an
owner or operator of real estate may be liable for the costs of clean-up of
certain conditions relating to the presence of hazardous or toxic materials on,
in or emanating from the property, and any related damages to natural resources.
Environmental laws often impose liability without regard to whether the owner or
operator knew of, or was responsible for, the presence of hazardous or toxic
materials. The presence of such materials, or the failure to address those
conditions properly, may adversely affect the ability to rent or sell the
property or to borrow using the property as collateral. Persons who dispose of
or arrange for the disposal or treatment of hazardous or toxic materials may
also be liable for the costs of clean-up of such materials, or for related
natural resource damages, at or from an off-site disposal or treatment facility,
whether or not the facility is owned or operated by those persons. No assurance
can be given that existing environmental assessments with respect to any of our
properties reveal all environmental liabilities, that any prior owner or
operator of any of the properties did not create any material environmental
condition not known to us or that a material environmental condition does not
otherwise exist as to any of our properties.
We might fail to qualify or remain qualified as a REIT.
First Industrial Realty Trust, Inc. intends to operate so as to qualify as
a REIT under the Internal Revenue Code of 1986. Although we believe that First
Industrial Realty Trust, Inc. is organized and will operate in a manner so as to
qualify as a REIT, qualification as a REIT involves the satisfaction of numerous
requirements, some of which must be met on a recurring basis. These requirements
are established under highly technical and complex Code provisions of which
there are only limited judicial or administrative interpretations, and involve
the determination of various factual matters and circumstances not entirely
within our control. If First Industrial Realty Trust, Inc. were to fail to
qualify as a REIT in any taxable year, First Industrial Realty Trust, Inc. would
be subject to federal income tax, including any applicable alternative minimum
tax, on First Industrial Realty Trust, Inc.'s taxable income at corporate rates.
This could result in a discontinuation or substantial reduction
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in dividends to stockholders. Unless entitled to relief under certain statutory
provisions, First Industrial Realty Trust, Inc. also would be disqualified from
treatment as a REIT for the four taxable years that follow. See "Federal Income
Tax Considerations."
The REIT distribution requirements may require us to turn to external financing
sources.
First Industrial Realty Trust, Inc. could, in certain instances, have
taxable income without sufficient cash to enable First Industrial Realty Trust,
Inc. to meet the distribution requirements of the REIT provisions of the Code.
In that situation, we could be required to borrow funds or sell properties on
adverse terms in order to meet those distribution requirements. In addition,
because First Industrial Realty Trust, Inc. must distribute to its stockholders
at least 90% of our REIT taxable income each year, our ability to accumulate
capital may be limited. Thus, in connection with future acquisitions, First
Industrial Realty Trust, Inc. may be more dependent on outside sources of
financing, such as debt financing or issuances of additional capital stock,
which may or may not be available on favorable terms. Additional debt financings
may substantially increase our leverage and additional equity offerings may
result in substantial dilution of stockholders' interests. See "Federal Income
Tax Considerations."
There are restrictions on the transfer of our common stock.
To maintain First Industrial Realty Trust, Inc.'s qualification as a REIT
under the Code, no more than 50% in value of our outstanding capital stock may
be owned, actually or by attribution, by five or fewer "individuals", as defined
in the Code to include certain entities, during the last half of a taxable year.
Accordingly, First Industrial Realty Trust, Inc.'s articles of incorporation
contain provisions restricting the ownership and transfer of our capital stock.
See "Restrictions on Transfers of Capital Stock."
Debt financing and the degree of leverage could reduce our cash flow.
Where possible, we intend to continue to use leverage to increase the rate
of return on our investments and to allow us to make more investments than we
otherwise could. Our use of leverage presents an additional element of risk in
the event that the cash flow from our properties is insufficient to meet both
debt payment obligations and the distribution requirements of the REIT
provisions of the Code.
Cross-collateralization of mortgage loans could result in foreclosure on
substantially all of our properties if we are unable to service our
indebtedness.
If the Operating Partnership determines to obtain additional debt financing
in the future, it may do so through mortgages on some or all of its properties.
These mortgages may be on recourse, non-recourse or cross-collateralized bases.
Cross-collateralization makes all of the subject properties available to the
lender in order to satisfy our debt. Holders of indebtedness that is so secured
will have a claim against these properties. To the extent indebtedness is
cross-collateralized, lenders may seek to foreclose upon properties that are not
the primary collateral for their loan, which may, in turn, result in
acceleration of other indebtedness secured by properties. Foreclosure of
properties would result in a loss of income and asset value to First Industrial,
L.P. and First Industrial Realty Trust, Inc., making it difficult for us to meet
both debt payment obligations and the distribution requirements of the REIT
provisions of the Code. As of December 31, 2002, none of our current
indebtedness was cross-collateralized.
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We may have to make lump-sum payments on our existing indebtedness.
We are required to make the following lump-sum or "balloon" payments under
the terms of some of our indebtedness, including the Operating Partnership's:
o $50 million aggregate principal amount of 7.75% Notes due 2032 (the
"2032 Notes")
o $200 million aggregate principal amount of 7.60% Notes due 2028 (the
"2028 Notes")
o approximately $15 million aggregate principal amount of 7.15% Notes
due 2027 (the "2027 Notes")
o $100 million aggregate principal amount of 7.50% Notes due 2017 (the
"2017 Notes")
o $200 million aggregate principal amount of 6.875% Notes due 2012 (the
"2012 Notes")
o $100 million aggregate principal amount of 7.375% Notes due 2011 (the
"Trust Notes")
The trust to which the Trust Notes were issued must exercise its
right to require First Industrial Realty Trust, Inc., through the
Operating Partnership, to redeem the Trust Notes on May 15, 2004
if the holder of a call option with respect to the Trust Notes
fails to give written notice on or before May 1, 2004 that it
intends to exercise such option.
o $200 million aggregate principal amount of our 7.375% Notes due 2011
(the "2011 Notes")
o $150 million aggregate principal amount of 7.60% Notes due 2007 (the
"2007 Notes")
o $150 million aggregate principal amount of 7.0% Notes due 2006 (the
"2006 Notes")
o $50 million aggregate principal amount of 6.90% Notes due 2005 (the
"2005 Notes")
and
o a $300 million unsecured revolving credit facility (the "Unsecured
Line of Credit") under which First Industrial Realty Trust, Inc.,
through the Operating Partnership, may borrow to finance the
acquisition of additional properties and for other corporate purposes,
including working capital.
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The Unsecured Line of Credit provides for the repayment of
principal in a lump-sum or "balloon" payment at maturity in 2005.
Under the Unsecured Line of Credit, the Operating Partnership has
the right, subject to certain conditions, to increase the
aggregate commitment under the Unsecured Line of Credit by up to
$100 million. As of December 31, 2002, $170.3 million was
outstanding under the Unsecured Line of Credit at a weighted
average interest rate of 2.88%.
Our ability to make required payments of principal on outstanding
indebtedness, whether at maturity or otherwise, may depend on our ability either
to refinance the applicable indebtedness or to sell properties. We have no
commitments to refinance the 2005 Notes, the 2006 Notes, the 2007 Notes, the
2011 Notes, the 2012 Notes, the Trust Notes, the 2017 Notes, the 2027 Notes, the
2028 Notes, the 2032 Notes or the Unsecured Line of Credit. Some of the existing
debt obligations, other than those discussed above, of First Industrial Realty
Trust, Inc., through the Operating Partnership, are secured by our properties,
and therefore such obligations will permit the lender to foreclose on those
properties in the event of a default.
There is no limitation on debt in our organizational documents.
We currently have a policy of maintaining a ratio of debt to total market
capitalization of 50% or less. We compute that percentage by calculating our
total consolidated debt as a percentage of the aggregate market value of all
outstanding shares of our common stock, assuming the exchange of all limited
partnership units of the Operating Partnership for common stock, plus the
aggregate stated value of all outstanding shares of preferred stock and total
consolidated debt. We also currently have a policy of maintaining a coverage
ratio of at least 2.0:1. We calculate the coverage ratio as total revenues minus
property expenses (including revenues and property expenses from discontinued
operations) and general and administrative expenses divided by interest expense
and dividends on preferred stock.
As of December 31, 2002 our ratio of debt to our total market
capitalization was 48.7% and for the twelve months ended December 31, 2002 our
coverage ratio was 2.08:1. The organizational documents of First Industrial
Realty Trust, Inc., however, do not contain any limitation on the amount or
percentage of indebtedness we may incur and our Board of Directors has the power
to alter the current policy. Accordingly, we could become more highly leveraged,
resulting in an increase in debt service that could adversely affect our ability
to make expected distributions to stockholders and in an increased risk of
default on our obligations.
Rising interest rates on our Unsecured Line of Credit could decrease our
available cash.
Our Unsecured Line of Credit bears interest at a floating rate. As of
December 31, 2002, our Unsecured Line of Credit had an outstanding balance of
$170.3 million at a weighted average interest rate of 2.88%. Currently, our
Unsecured Line of Credit bears interest at the Prime Rate or at the London
Interbank Offered Rate plus .70%. Based on an outstanding balance on our
Unsecured Line of Credit as of December 31, 2002, a 10% increase in interest
rates would increase interest expense by $0.5 million on an annual basis.
Increases in the interest rate payable on balances outstanding under the
Unsecured Line of Credit would decrease our cash available for distribution to
stockholders.
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The charter documents of First Industrial Realty Trust, Inc. may hinder attempts
to acquire us or have anti-takeover effects.
Provisions of the articles of incorporation of First Industrial Realty
Trust, Inc. may have the effect of delaying, deferring or preventing a third
party from making an acquisition proposal for First Industrial Realty Trust,
Inc. and thus inhibit a change in control, thereby limiting the opportunity for
First Industrial Realty Trust, Inc.'s stockholders to receive a premium for
their common stock. Those provisions include:
o the requirement that not less than two-thirds of all of the votes
entitled to be cast on the matter are required to amend the articles
of incorporation of First Industrial Realty Trust, Inc.; and
o a prohibition on any holder owning more than 9.9% in value of the
capital stock of First Industrial Realty Trust, Inc.
The bylaws of First Industrial Realty Trust, Inc. include a provision whereby
stockholder notice is required prior to any stockholder nomination of a
director. See "Certain Provisions of Maryland Law and the First Industrial
Realty Trust, Inc. Articles of Incorporation and Bylaws" and "Restrictions on
Transfers of Capital Stock."
The terms of our junior participating preferred stock are anti-takeover in
nature. In the event of any merger, consolidation, combination or other
transaction in which shares of common stock are exchanged for or changed into
other stock or securities, cash and/or other property, each share of First
Industrial Realty Trust, Inc. junior participating preferred stock will be
entitled to receive 100 times the aggregate amount of stock, securities, cash
and/or other property, into which or for which each share of First Industrial
Realty Trust, Inc. common stock is changed or exchanged, subject to certain
adjustments. See "Description of Common Stock - Shareholder Rights Plan."
The provisions of First Industrial Realty Trust, Inc.'s preferred stock may
hinder attempts to acquire us.
Under the articles of incorporation of First Industrial Realty Trust, Inc.,
First Industrial Realty Trust, Inc. has authority to issue up to 10,000,000
shares of preferred stock on such terms as may be authorized by First Industrial
Realty Trust, Inc.'s board of directors. The following amounts were outstanding
on December 31, 2002:
o 20,000 shares of Series C preferred stock
o 50,000 shares of Series D preferred stock, and
o 30,000 shares of Series E preferred stock.
The terms of the preferred stock could delay, deter or prevent a change in
control or other transaction that might involve a premium price or otherwise be
in the best interest of First Industrial Realty Trust, Inc.'s stockholders. The
board of directors has also reserved 1,000,000 shares of our junior
participating preferred stock for issuance under a shareholder rights plan
adopted by First Industrial Realty Trust, Inc.'s board of directors. The terms
of the shareholder rights plan could delay, deter or prevent a change in control
or other transaction that might involve a premium price or otherwise be in the
best
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interest of First Industrial Realty Trust, Inc.'s stockholders. See "Description
of Common Stock--Shareholders Rights Plan."
Maryland law provisions may hinder attempts to acquire First Industrial Realty
Trust, Inc.
Under the Maryland Business Combination Act, specified business
combinations between a Maryland corporate REIT, such as First Industrial Realty
Trust, Inc., and an interested stockholder or an affiliate of an interested
stockholder, are prohibited for five years after the most recent date on which
the interested stockholder became an interested stockholder. Business
combinations for the purposes of the preceding sentence are defined by the
Maryland Business Combination Act to include specified mergers, consolidations,
share exchanges and asset transfers, certain issuances and transfers of equity
securities, certain reclassifications of securities or recapitalizations of the
corporation, the adoption of a plan of liquidation or dissolution or the receipt
by an interested stockholder or its affiliate of any loan, advance, guarantee,
pledge or other financial assistance or tax advantage provided by First
Industrial Realty Trust, Inc. The Maryland Business Combination Act defines an
interested stockholder as a person who, subject to certain exceptions,
beneficially owns 10% or more of the voting power of the corporation's shares
after the date on which the corporation had 100 or more beneficial owners of its
stock or who is an affiliate or associate of the corporation and was the
beneficial owner of 10 percent or more of the voting power of the corporation's
shares at any time within the prior two years and after the date on which the
corporation had 100 or more beneficial owners of its stock.
After the five-year period, any such business combination must be
recommended by the board of directors and approved by 80% of the votes entitled
to be cast by outstanding shares of voting stock of the corporation, voting
together as a single voting group, and by two-thirds of the votes entitled to be
cast by holders of voting stock other than voting stock held by the interested
stockholder unless, among other conditions, the corporation's stockholders
receive a minimum price, as defined in the Maryland Business Combination Act for
their shares, in cash or in the same form as previously paid by the interested
stockholder for its shares. In addition to certain other exemptions, the
provisions of the Maryland Business Combination Act do not apply to business
combinations that are approved or exempted by the board of directors prior to
the time that the interested stockholder becomes an interested stockholder.
First Industrial Realty Trust, Inc.'s articles of incorporation exempt from
the Maryland Business Combination Act any business combination in which there is
no interested stockholder other than Jay H. Shidler, Chairman of our Board of
Directors, or any entity controlled by Mr. Shidler, unless Mr. Shidler is an
interested stockholder without taking into account Mr. Shidler's ownership of
shares of First Industrial Realty Trust, Inc.'s common stock and the right to
acquire shares of common stock in an aggregate amount which does not exceed the
number of shares that Mr. Shidler owned and had the right to acquire, including
through the exchange of limited partnership units of First Industrial, L.P., at
the time of the consummation of First Industrial Realty Trust, Inc.'s initial
public offering.
As a result, Mr. Shidler and entities controlled by him may enter into
business combinations with First Industrial Realty Trust, Inc. that may not be
in the best interest of its stockholders. With respect to business combinations
with any other interested stockholder or affiliate of such interested
stockholder, the application of the Maryland Business Combination Act may delay,
deter or prevent a change in control of First Industrial Realty Trust, Inc. that
might involve a premium price or otherwise be in the best interest of
stockholders.
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The Maryland Control Share Acquisition Act provides that "control shares"
of a Maryland corporate REIT such as First Industrial Realty Trust, Inc.
acquired in a control share acquisition have no voting rights, except to the
extent approved by a vote of two-thirds of all votes entitled to be cast on the
matter, excluding shares owned by or entitled to be voted by or at the direction
of the acquiror, officers of the corporation or employees who are also directors
of the corporation. "Control shares" are defined as shares of stock owned by or
entitled to be voted by or at the direction of a person that, when aggregated
with other shares owned by the holder, will entitle their holder to exercise
voting power in one of several specified ranges in elections of directors. To
the extent voting rights with respect to control shares have not been approved
at a meeting of stockholders by such supermajority vote, then, subject to
certain conditions and limitations, the issuer may redeem the control shares for
fair value determined in accordance with the Maryland Control Share Acquisition
Act. If voting rights for control shares are approved at a stockholders meeting
and the acquiror becomes entitled to vote a majority of the shares entitled to
vote, all other stockholders may exercise appraisal rights. First Industrial
Realty Trust, Inc.'s bylaws contain a provision exempting any and all
acquisitions of shares of First Industrial Realty Trust, Inc.'s capital stock
from the Maryland Control Share Acquisition Act. There can be no assurance that
this provision will not be amended or eliminated in the future.
The composition of First Industrial Realty Trust, Inc.'s board of directors
could hinder a change in control.
First Industrial Realty Trust, Inc.'s directors are divided into three
classes by its articles of incorporation, with terms expiring over a three-year
period. The classified board provision could make it more difficult and
time-consuming to remove the incumbent directors and may delay, deter or prevent
a change in control of First Industrial Realty Trust, Inc. that might involve a
premium price or otherwise be in the best interest of stockholders.
Some of First Industrial Realty Trust, Inc.'s officers and directors may have
interests opposed to us with respect to certain transactions because they may
suffer adverse tax consequences.
Some of the officers and directors of First Industrial Realty Trust, Inc.
own limited partnership units of the Operating Partnership, which may be
exchanged for shares of common stock. As of December 31, 2002, those officers
and directors include Jay H. Shidler, Chairman of the Board of Directors of
First Industrial Realty Trust, Inc., Michael W. Brennan, President and Chief
Executive Officer and a Director of First Industrial Realty Trust, Inc.,
Johannson L. Yap, Chief Investment Officer of First Industrial Realty Trust,
Inc., Michael G. Damone, Director of Strategic Planning and a Director of First
Industrial Realty Trust, Inc., Timothy E. Gudim, a Managing Director of First
Industrial Realty Trust, Inc., Gregory S. Downs, a Managing Director of First
Industrial Realty Trust, Inc. and Kevin Smith, a Senior Regional Director of
First Industrial Realty Trust, Inc. Prior to the exchange of units for common
stock, the officers and directors who own limited partnership units may suffer
different and more adverse tax consequences than holders of common stock upon
the sale of certain of our properties, the refinancing of debt associated with
those properties or in connection with a proposed tender offer or merger
involving us. Therefore, those individuals and First Industrial Realty Trust,
Inc., as partners in the Operating Partnership, may have different objectives
regarding the appropriate terms of any such transaction.
USE OF PROCEEDS
We will not receive any proceeds from this offering.
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SELLING STOCKHOLDERS
The selling stockholders are persons who may receive, or have received,
shares of common stock in exchange for limited partnership units of First
Industrial, L.P. issued as consideration for the contribution of certain real
estate to First Industrial, L.P. The limited partnership units were issued in
private transactions exempt from registration under the Securities Act of 1933.
The limited partnership units must be held for one year before they can be
acquired by us in exchange for our common stock.
The table below provides, as of March 28, 2003, the names of each selling
stockholder and the number of shares of common stock offered by each selling
stockholder. As we are not obligated to issue common stock upon exchange for the
limited partnership units and the selling stockholders may sell all, some or
none of their shares of common stock, no estimate can be made of the aggregate
number of shares of common stock that are to be offered hereby, or the aggregate
number of shares of common stock that will be owned by each selling stockholder
upon completion of the offering to which this prospectus relates. The number of
shares in the column "Number of shares offered hereby" includes the number of
shares of common stock the selling stockholder may receive in exchange for
limited partnership units, except as noted. Amounts shown in the "Number of
shares and units owned before the offering" represent the number of securities
shown in the column "Number of shares offered hereby" plus shares of common
stock and limited partnership units owned by the selling stockholders that are
not covered by the registration statement of which this prospectus forms a part.
All of the selling stockholders are offering all of the common stock they will
own as a result of the exchange of our common stock for their limited
partnership units.
With respect to the information presented concerning the selling
stockholders listed in the table below, we have not conducted any independent
inquiry or investigation to ascertain that information and have relied on
written questionnaires furnished to us by the selling stockholders for the
express purpose of including that information in this prospectus. None of the
selling stockholders has, or within the past three years has had, any position,
office of other material relationship with us or any of our affiliates.
The shares of common stock offered by this prospectus may be offered from
time to time by the selling stockholders named below:
Number of shares and units Number of shares
Name owned before the offering offered hereby
------------------------------------------- --------------------------------- -------------------
First & Broadway Limited Partnership 18,203 18,203(1)
Robert W. Holman Jr. 173,124 150,213(2)
----------
(1) Represents shares of common stock that may be received in exchange for
limited partnership units that were issued as consideration for the
contribution of certain real estate to First Industrial, L.P. on June 26,
2002.
(2) Represents shares of common stock that may be received in exchange for
limited partnership units that were issued as consideration for the
contribution of certain real estate to First Industrial, L.P. on June 30,
1994.
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PLAN OF DISTRIBUTION
We are registering the selling stockholders' common stock for sale to
provide them with freely tradable securities, but the registration of their
common stock does not necessarily mean that any of those shares will be issued
by us or offered or sold by the selling stockholders. We will not receive any
proceeds from the offering by the selling stockholders of their common stock.
The selling stockholders may offer shares of common stock that may be
issued to them upon the exchange by First Industrial Realty Trust, Inc. of
shares of its common stock for limited partnership units of First Industrial,
L.P. The limited partnership units were previously issued to the selling
stockholders in private placements exempt from the registration provisions of
the Securities Act. First Industrial Realty Trust, Inc. will issue up to 168,416
shares of common stock to the selling stockholders in exchange for their limited
partnership units.
First Industrial Realty Trust, Inc. will issue one share of common stock
for each limited partnership unit acquired from the selling stockholders.
Consequently, with each exchange, First Industrial Realty Trust, Inc.'s interest
in First Industrial, L.P. will increase.
The common stock may be sold from time to time to purchasers:
o directly by the selling stockholders or
o through underwriters, broker-dealers or agents who may receive
compensation, which will not exceed amounts customary for the type of
transaction, in the form of discounts, concessions or commissions from
the selling stockholders and/or the purchasers of shares of common
stock.
The selling stockholders and any broker-dealers or agents who participate
in the distribution of the common stock may be deemed to be "underwriters." As a
result, any profits on the sale of the common stock by the selling stockholders
and any discounts, commissions or concessions received by any broker-dealers or
agents might be deemed to be underwriting discounts and commissions under the
Securities Act. If the selling stockholders were deemed to be underwriters, the
selling stockholders may be subject to certain statutory liabilities under, but
not limited to, Sections 11, 12 and 17 of the Securities Act and Rule 10b-5
under the Securities Exchange Act of 1934.
If the shares of common stock are sold through underwriters or
broker-dealers, the selling stockholders will be responsible for underwriting
discounts or commissions or agent's commissions.
The common stock offered by this prospectus may be sold in one or more
transactions at:
o fixed prices,
o prevailing market prices at the time of sale,
o varying prices determined at the time of sale, or
o negotiated prices.
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These sales may be effected in transactions:
o on any national securities exchange or quotation service on which the
common stock may be listed or quoted at the time of the sale,
including the New York Stock Exchange,
o in the over-the-counter market,
o in transactions otherwise than on these exchanges or services or in
the over-the-counter market, or
o through the writing of options.
These transactions may include block transactions or crosses. Crosses are
transactions in which the same broker acts as an agent on both sides of the
trade.
At any time a particular offer of the common stock is made, a revised
prospectus or prospectus supplement, if required, will be distributed. The
revised prospectus or prospectus supplement will include the aggregate number of
shares of common stock being offered and the terms of the offering, including
the name or names of any underwriters, dealers or agents, any discounts,
commissions, concessions and other items constituting compensation from the
selling stockholders and any discounts, commissions or concessions allowed or
reallowed or paid to dealers. The prospectus supplement and, if necessary, a
post-effective amendment to the registration statement of which this prospectus
is a part, will be filed with the Commission to reflect the disclosure of
additional information with respect to the distribution of the common stock.
Under the securities laws of certain states, the common stock may be
offered and sold in the state only through registered or licensed brokers or
dealers. In addition, in certain states the common stock may not be offered or
sold unless it has been registered or qualified for sale in the state or an
exemption from registration or qualification is available and is complied with.
There can be no assurance that any selling stockholder will sell any or all
of the common stock registered under the registration statement of which this
prospectus forms a part. In addition, any shares of common stock covered by this
prospectus that qualify for sale pursuant to Rule 144 of the Securities Act may
be sold under Rule 144 rather than using this prospectus.
The selling stockholders and any other person participating in the
distribution will be subject to the applicable provisions of the Exchange Act
and the rules and regulations under the Exchange Act. The Exchange Act rules
include, without limitation, Regulation M, which may limit the timing of
purchases and sales of any of the common stock by the selling stockholders and
any other person participating in the distribution. In addition, Regulation M of
the Exchange Act may restrict the ability of any person engaged in the
distribution of the common stock to engage in market-making activities with
respect to the particular shares of common stock being distributed for a period
of up to five business days prior to the commencement of the distribution. This
may affect the marketability of the shares of common stock and the ability of
any person or entity to engage in market-making activities with respect to the
shares of common stock.
Under various registration rights agreements for the benefit of certain
selling stockholders, we have agreed to pay all expenses of registering the
common stock offered hereby, except
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for underwriting discounts and commissions, fees and disbursements of counsel,
accountants or others representing any selling stockholder and transfer taxes,
if any. We have agreed to indemnify each selling stockholder and its officers
and directors and any person who controls any selling stockholder against
certain losses, claims, damages and expenses arising under the securities laws.
DESCRIPTION OF COMMON STOCK
The following is a summary of the material terms of our common stock. You
should read our articles of incorporation and bylaws, which are incorporated by
reference to the registration statement of which this prospectus is a part.
General
Under our articles of incorporation, First Industrial Realty Trust, Inc.
has authority to issue 100 million shares of its common stock, par value $.01
per share. Under Maryland law, stockholders generally are not responsible for
the corporation's debts or obligations. At March 21, 2003 we had outstanding
38,758,192 shares of common stock.
Terms
Subject to the preferential rights of any other shares or series of stock,
including preferred stock outstanding from time to time, and to the provisions
of our articles of incorporation regarding excess stock, common stock holders
will be entitled to receive dividends on shares of common stock if, as and when
authorized and declared by our board of directors out of assets legally
available for that purpose. Subject to the preferential rights of any other
shares or series of stock, including preferred stock outstanding from time to
time, and to the provisions of our articles of incorporation regarding excess
stock, common stockholders will share ratably in the assets of First Industrial
Realty Trust, Inc. legally available for distribution to its stockholders in the
event of its liquidation, dissolution or winding up after payment of, or
adequate provision for, all known debts and liabilities of First Industrial
Realty Trust, Inc. For a discussion of excess stock, see "Restrictions on
Transfers of Capital Stock."
Subject to the provisions of our articles of incorporation regarding excess
stock, each outstanding share of common stock entitles the holder to one vote on
all matters submitted to a vote of stockholders, including the election of
directors, and, except as otherwise required by law or except as provided with
respect to any other class or series of stock, common stock holders will possess
the exclusive voting power. There is no cumulative voting in the election of
directors, which means that the holders of a majority of the outstanding shares
of common stock can elect all of the directors then standing for election, and
the holders of the remaining shares of common stock will not be able to elect
any directors.
Common stock holders have no conversion, sinking fund or redemption rights,
or preemptive rights to subscribe for any securities of First Industrial Realty
Trust, Inc.
Subject to the provisions of our articles of incorporation regarding excess
stock, all shares of common stock will have equal dividend, distribution,
liquidation and other rights, and will have no preference, appraisal or exchange
rights.
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Under the MGCL, a corporation generally cannot dissolve, amend its articles
of incorporation, merge, sell all or substantially all of its assets, engage in
a share exchange or engage in similar transactions outside the ordinary course
of business unless approved by the affirmative vote of stockholders holding at
least two-thirds of the shares entitled to vote on the matter unless a lesser
percentage, but not less than a majority of all of the votes to be cast on the
matter, is set forth in the corporation's articles of incorporation. Our
articles of incorporation do not provide for a lesser percentage in such
situations.
Restrictions on ownership
For First Industrial Realty Trust, Inc. to qualify as a REIT under the
Code, not more than 50% in value of its outstanding capital stock may be owned,
actually or by attribution, by five or fewer individuals, as defined in the Code
to include certain entities, during the last half of a taxable year. To assist
us in meeting this requirement, we may take certain actions to limit the
beneficial ownership, directly or indirectly, by individuals of our outstanding
equity securities. See "Restrictions on Transfers of Capital Stock."
Transfer agent
The transfer agent and registrar for the common stock is EquiServe Trust
Company, N.A.
Shareholder rights plan
On September 4, 1997, the board of directors of First Industrial Realty
Trust, Inc. adopted a shareholder rights plan. Under the shareholder rights
plan, one right was attached to each outstanding share of common stock at the
close of business on October 19, 1997, and one right will be attached to each
share of common stock thereafter issued. Each right entitles the holder to
purchase, under certain conditions, one one-hundredth of a share of our junior
participating preferred stock for $125.00. The rights may also, under certain
conditions, entitle the holders to receive common stock, or common stock of an
entity acquiring First Industrial Realty Trust, Inc., or other consideration,
each having a value equal to twice the exercise price of each right ($250.00).
We have designated 1,000,000 shares as junior participating preferred stock and
have reserved such shares for issuance under the shareholder rights plan. In the
event of any merger, consolidation, combination or other transaction in which
shares of common stock are exchanged for or changed into other stock or
securities, cash and/or other property, each share of junior participating
preferred stock will be entitled to receive 100 times the aggregate amount of
stock, securities, cash and/or other property, into which or for which each
share of common stock is changed or exchanged, subject to certain adjustments.
The rights are redeemable by us at a price of $.001 per right. If not exercised
or redeemed, all rights expire on October 20, 2007. The description and terms of
the rights are set forth in a shareholder rights agreement between us and First
Chicago Trust Company of New York.
CERTAIN PROVISIONS OF MARYLAND LAW AND THE
FIRST INDUSTRIAL REALTY TRUST, INC. ARTICLES OF INCORPORATION AND BYLAWS
The following summary of certain provisions of Maryland law is not complete
and is qualified by reference to Maryland law and our articles of incorporation
and bylaws, which are incorporated by reference to the registration statement of
which this prospectus is a part.
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Business combinations
Under the Maryland Business Combination Act specified "business
combinations" between a Maryland corporate REIT, such as First Industrial Realty
Trust, Inc., and an interested stockholder or an affiliate of an interested
stockholder are prohibited for five years after the most recent date on which
the interested stockholder became an interested stockholder. Business
combinations, for the purposes of the preceding sentence, are defined by the
Maryland Business Combination Act to include specified mergers, consolidations,
share exchanges and asset transfers, certain issuances and transfers of equity
securities, certain reclassifications of securities or recapitalizations of the
corporation, the adoption of a plan of liquidation or dissolution or the receipt
by an interested stockholder or its affiliate of any loan, advance, guarantee,
pledge or other financial assistance or tax advantage provided by First
Industrial Realty Trust, Inc. The Maryland Business Combination Act defines an
interested stockholder as a person who, subject to certain exceptions,
beneficially owns 10% or more of the voting power of the corporation's shares
after the date on which the corporation had 100 or more beneficial owners of its
stock or who is an affiliate or associate of the corporation and was the
beneficial owner of 10 percent or more of the voting power of the corporation's
shares at any time within the prior two years and after the date on which the
corporation had 100 or more beneficial owners of its stock.
After the five-year period, any such business combination must be
recommended by the board of directors of the corporation and approved by the
affirmative vote of at least
o 80% of the votes entitled to be cast by holders of outstanding shares
of voting stock of the corporation, voting together as a single voting
group and
o two-thirds of the votes entitled to be cast by holders of voting stock
of the corporation other than voting stock held by the interested
stockholder with whom the business combination is to be effected or by
an affiliate or associate of the interested stockholder, voting
together as a single voting group.
The super-majority vote requirements will not apply if, among other things,
the corporation's stockholders receive a minimum price (as defined in the
Maryland Business Combination Act) for their shares and the consideration is
received in cash or in the same form as previously paid by the interested
stockholder for its shares. In addition to certain other exemptions, these
provisions of the Maryland Business Combination Act do not apply to business
combinations that are approved or exempted by the board of directors of the
corporation prior to the time that the interested stockholder becomes an
interested stockholder.
Our articles of incorporation exempt from the provisions of the Maryland
Business Combination Act any business combination in which there is no
interested stockholder other than Jay H. Shidler, the Chairman of our board of
directors, or any entity controlled by Mr. Shidler, unless Mr. Shidler is an
interested stockholder without taking into account his ownership of shares of
our common stock and the right to acquire shares of our common stock in an
aggregate amount that does not exceed the number of shares of our common stock
that he owned and had the right to acquire, including through the exchange of
limited partnership units of First Industrial, L.P., at the time of the
consummation of our initial public offering.
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Control share acquisitions
The Maryland Control Share Acquisition Act provides that control shares of
a Maryland corporate REIT, such as First Industrial Realty Trust, Inc., acquired
in a control share acquisition have no voting rights except to the extent
approved by a vote of two-thirds of all votes entitled to be cast on the matter,
excluding shares owned by or entitled to be voted by or at the direction of the
acquiror, officers of the corporation or employees who are also directors of the
corporation. "Control shares" are voting shares of stock that would, if
aggregated with all other shares of stock owned by or entitled to be voted by or
at the direction of the acquiror, entitle the acquiror to exercise voting power
in electing directors within any of the following ranges of voting power:
o one-tenth or more but less than one-third,
o one-third or more but less than a majority, or
o a majority of all voting power.
Control shares do not include shares the acquiring person is then entitled
to vote as a result of having previously obtained stockholder approval under the
Maryland Control Share Acquisition Act. A "control share acquisition" means the
acquisition of ownership of control shares or the power to direct the exercise
of voting power with respect to control shares, subject to certain exceptions.
Any person who proposes to make or who has made a control share acquisition
may deliver an acquiring person statement to the corporation that includes the
identity of the acquiring person and each other member of any group of which the
person is a part, among other information. A person who has made or proposes to
make a control share acquisition may compel the board of directors, by making
request at the time of delivery of any acquiring person statement and delivery
of a written undertaking to pay certain expenses, to call a special meeting of
stockholders to be held within 50 days after receiving a demand and such
undertaking to consider the voting rights of the shares. If no request for a
meeting is made, the corporation may itself present the question at any meeting
of stockholders.
If voting rights are not approved at the meeting or if the acquiring person
does not deliver an acquiring person statement in accordance with the Maryland
Control Share Acquisition Act then, subject to certain conditions and
limitations, the corporation may redeem any or all of the control shares, except
those for which voting rights have previously been approved in accordance with
the Maryland Control Share Acquisition Act. The corporation's redemption of the
control shares will be for fair value determined, without regard to the absence
of voting rights, as of the date of the last control share acquisition or, if a
meeting is held to consider the voting rights of the shares at which the voting
rights of the control shares are considered and not approved, the date of such
meeting. If voting rights for control shares are approved at a stockholders
meeting and the acquiror becomes entitled to vote or direct the vote of a
majority of the shares entitled to vote, all other stockholders may exercise
appraisal rights. The fair value of the shares as determined for purposes of the
appraisal rights may not be less than the highest price per share paid in the
control share acquisition. Certain limitations and restrictions otherwise
applicable to the exercise of dissenters' rights do not apply in the context of
a control share acquisition.
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The control share acquisition statute does not apply to
o shares acquired in a merger, consolidation or share exchange if the
corporation is a party to the transaction, or
o acquisitions approved or exempted by a provision contained in our
articles of incorporation or bylaws and adopted at any time before the
acquisition of the shares.
Our bylaws contain a provision exempting any and all acquisitions of our
shares of capital stock from the Maryland Control Share Acquisition Act. There
can be no assurance that this bylaw provision will not be amended or eliminated
in the future.
Amendment of articles of incorporation
Our articles of incorporation, including the provisions on classification
of the board of directors discussed below, may be amended only by the
affirmative vote of the holders of not less than two-thirds of all of the votes
entitled to be cast on the matter.
Meetings of stockholders
Our bylaws provide for annual meetings of stockholders to be held on the
third Wednesday in April or on any other day as may be established from time to
time by our board of directors. Special meetings of stockholders may be called
by
o our Chairman of the board or our President,
o a majority of the board of directors, or
o stockholders holding at least 25% of our outstanding capital stock
entitled to vote at the meeting.
Our bylaws provide that any stockholder of record wishing to nominate a
director or have a stockholder proposal considered at an annual meeting must
provide written notice and certain supporting documentation to us relating to
the nomination or proposal not less than 75 days nor more than 180 days prior to
the anniversary date of the prior year's annual meeting or special meeting in
lieu thereof (the "Anniversary Date"). In the event that the annual meeting is
called for a date more than seven calendar days before the Anniversary Date,
stockholders generally must provide written notice within 20 calendar days after
the date on which notice of the meeting is mailed to stockholders or the date of
the meeting is publicly disclosed.
The purpose of requiring stockholders to give us advance notice of
nominations and other business is to afford our board of directors a meaningful
opportunity to consider the qualifications of the proposed nominees or the
advisability of the other proposed business and, to the extent deemed necessary
or desirable by our board of directors, to inform stockholders and make
recommendations about the qualifications or business, as well as to provide a
more orderly procedure for conducting meetings of stockholders. Although our
bylaws do not give our board of directors any power to disapprove stockholder
nominations for the election of directors or proposals for action, they may have
the effect of precluding a contest for the election of directors or the
consideration of stockholder
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proposals if the proper procedures are not followed and of discouraging or
deterring a third party from conducting a solicitation of proxies to elect its
own slate of directors or to approve its own proposal. Our bylaws may have those
effects without regard to whether consideration of the nominees or proposal
might be harmful or beneficial to us and our stockholders.
Classification of the board of directors
Our bylaws provide that the number of our directors may be established by
the board of directors but may not be fewer than the minimum number required by
Maryland law nor more than twelve. Any vacancy will be filled, at any regular
meeting or at any special meeting called for that purpose, by a majority of the
remaining directors, except that a vacancy resulting from an increase in the
number of directors will be filled by a majority of the entire board of
directors. Under the terms of our articles of incorporation, our directors are
divided into three classes. One class holds office for a term expiring at the
annual meeting of stockholders to be held in 2003, and the other two classes
hold office for terms expiring at the annual meetings of stockholders to be held
in 2004 and 2005, respectively. As the term of each class expires, directors in
that class will be elected for a term of three years and until their successors
are duly elected and qualified. We believe that classification of our board of
directors will help to assure the continuity and stability of our business
strategies and policies as determined by our board of directors.
The classified board provision could have the effect of making the removal
of incumbent directors more time consuming and difficult, which could discourage
a third party from making a tender offer or otherwise attempting to obtain
control of us, even though such an attempt might be beneficial to us and our
stockholders. At least two annual meetings of stockholders, instead of one, will
generally be required to effect a change in a majority of our board of
directors. Thus, the classified board provision could increase the likelihood
that incumbent directors will retain their positions. Holders of shares of
common stock will have no right to cumulative voting for the election of
directors. Consequently, at each annual meeting of stockholders, the holders of
a majority of the shares of common stock will be able to elect all of the
successors of the class of directors whose term expires at that meeting.
RESTRICTIONS ON TRANSFERS OF CAPITAL STOCK
For First Industrial Realty Trust, Inc. to qualify as a REIT under the
Code, among other things, not more than 50% in value of its outstanding capital
stock may be owned, actually or by attribution, by five or fewer "individuals"
(as defined in the Code to include certain entities) during the last half of a
taxable year. Our capital stock must also be beneficially owned by 100 or more
persons during at least 335 days of a taxable year of 12 months or during a
proportionate part of a shorter tax year. See "Federal Income Tax
Considerations." To ensure that we remain a qualified REIT, our articles of
incorporation, subject to certain exceptions, provide that no holder may own, or
be deemed to own by virtue of the attribution provisions of the Code, more than
an aggregate of 9.9% in value of our capital stock. Any transfer of capital
stock or any security convertible into capital stock that would create a direct
or indirect ownership of capital stock in excess of the ownership limit or that
would result in our disqualification as a REIT, including any transfer that
results in the capital stock being owned by fewer than 100 persons or results in
us being "closely held" within the meaning of Section 856(h) of the Code, shall
be null and void, and the intended transferee will acquire no rights to the
capital stock.
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Capital stock owned, or deemed to be owned, or transferred to a stockholder
in excess of the ownership limit will automatically be exchanged for shares of
"excess stock," as defined in our articles of incorporation, that will be
transferred, by operation of law, to us as trustee of a trust for the exclusive
benefit of the transferees to whom such capital stock may be ultimately
transferred without violating the ownership limit. While the excess stock is
held in trust, it will not be entitled to vote, it will not be considered for
purposes of any stockholder vote or the determination of a quorum for such vote,
and it will not be entitled to participate in the accumulation or payment of
dividends or other distributions. A transferee of excess stock may, at any time
such excess stock is held by us in trust, designate as beneficiary of the
transferee stockholder's interest in the trust representing the excess stock any
individual whose ownership of the capital stock exchanged into such excess stock
would be permitted under the ownership limit, and may transfer that interest to
the beneficiary at a price not in excess of the price paid by the original
transferee-stockholder for the capital stock that was exchanged into excess
stock. Immediately upon the transfer to the permitted beneficiary, the excess
stock will automatically be exchanged for capital stock of the class from which
it was converted.
In addition, we will have the right, for a period of 90 days during the
time any excess stock is held by us in trust, and, with respect to excess stock
resulting from the attempted transfer of our preferred stock, at any time when
any outstanding shares of preferred stock of the series are being redeemed, to
purchase all or any portion of the excess stock from the original
transferee-stockholder at the lesser of the price paid for the capital stock by
the original transferee-stockholder and the market price, as determined in the
manner set forth in our articles of incorporation, of the capital stock on the
date we exercise our option to purchase or, in the case of a purchase of excess
stock attributed to preferred stock which has been called for redemption, at its
stated value, plus all accumulated and unpaid dividends to the date of
redemption. The 90-day period begins on the date of the violative transfer if
the original transferee-stockholder gives notice to us of the transfer or, if no
such notice is given, the date the board of directors determines that a
violative transfer has been made.
FEDERAL INCOME TAX CONSIDERATIONS
This section is a summary of the material federal income tax matters of
general application pertaining to REITs under the Code. The discussion is based
on current law and does not purport to deal with all aspects of federal income
taxation that may be relevant to investors subject to special treatment under
the federal income tax laws, such as tax-exempt investors, dealers in securities
or foreign persons. The provisions of the Code pertaining to REITs are highly
technical and complex and sometimes involve mixed questions of fact and law. In
addition, this section does not discuss foreign, state or local taxation. We
have received an opinion from Cahill Gordon & Reindel as to the conclusions of
law expressed in this summary. Prospective investors should consult their own
tax advisors regarding the federal, state, local, foreign and other tax
consequences specific to them of holding and disposing of the common stock.
In the opinion of Cahill Gordon & Reindel, commencing with our taxable year
ended December 31, 1994:
o we have been organized in conformity with the requirements for
qualification as a REIT under the Code,
o our method of operation has enabled us to meet the requirements for
qualification as a REIT under the Code, and
-22-
o provided that we continue to satisfy the various requirements
applicable under the Code to REITs, as described herein, we will
continue to so qualify.
Cahill Gordon & Reindel's opinion is based on various assumptions and is
conditioned upon certain representations made by us as to factual matters with
respect to us and certain partnerships, corporations and limited liability
companies through which we hold substantially all of our assets. Moreover, our
qualification and taxation as a REIT depends upon our ability to meet, as a
matter of fact, through actual annual operating results, distribution levels,
diversity of stock ownership and various other qualification tests imposed under
the Code discussed below, the results of which will not be reviewed by Cahill
Gordon & Reindel. No assurance can be given that the actual results of our
operations for any particular taxable year will satisfy those requirements.
To qualify as a REIT under the Code for a taxable year, we must meet
certain organizational and operational requirements, which generally require us
to be a passive investor in real estate and to avoid excessive concentration of
ownership of our capital stock. Generally, at least 75% of the value of our
total assets at the end of each calendar quarter must consist of real estate
assets, cash or governmental securities. We generally may not own securities
possessing more than 10% of the total voting power, or representing more than
10% of the total value, of the outstanding securities of any issuer, and the
value of any one issuer's securities may not exceed 5% of the value of our
assets. Shares of qualified REITs, qualified temporary investments and shares of
certain wholly owned subsidiary corporations are exempt from these prohibitions.
The 10% and 5% limitations described above will not apply to the ownership
of securities of a "taxable REIT subsidiary." A REIT may own up to 100% of the
securities of a taxable REIT subsidiary subject only to the limitations that the
aggregate value of the securities of all taxable REIT subsidiaries owned by the
REIT does not exceed 20% of the value of the assets of the REIT, and the
aggregate value of all securities owned by the REIT (including the securities of
all taxable REIT subsidiaries, but excluding government securities) does not
exceed 25% of the value of the assets of the REIT. A taxable REIT subsidiary
generally is any corporation (other than another REIT and corporations involved
in certain lodging, healthcare, franchising and licensing activities) owned by a
REIT with respect to which the REIT and such corporation jointly elect that such
corporation shall be treated as a taxable REIT subsidiary.
For each taxable year, at least 75% of a REIT's gross income must be
derived from specified real estate sources and 95% must be derived from such
real estate sources plus certain other permitted sources. Real estate income for
purposes of these requirements includes
o gain from the sale of real property not held primarily for sale to
customers in the ordinary course of business,
o dividends on REIT shares,
o interest on loans secured by mortgages on real property,
o certain rents from real property, and
o certain income from foreclosure property.
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For rents to qualify, they may not be based on the income or profits of any
person, except that they may be based on a percentage or percentages of gross
income or receipts. Also, subject to certain limited exceptions, the REIT may
not manage the property or furnish services to tenants except through an
independent contractor which is paid an arm's-length fee and from which the REIT
derives no income. However, a REIT may render a de minimis amount of otherwise
impermissible services to tenants, or in connection with the management of
property. In addition, a taxable REIT subsidiary may provide certain services to
tenants of the REIT, which services could not otherwise be provided by the REIT
or the REIT's other subsidiaries.
Substantially all of our assets are held through certain partnerships. In
general, in the case of a REIT that is a partner in a partnership, applicable
regulations treat the REIT as holding directly its proportionate share of the
assets of the partnership and as being entitled to the income of the partnership
attributable to such share.
We must satisfy certain ownership restrictions that limit the concentration
of ownership of our capital stock by a few individuals and the ownership by us
of our tenants. Our outstanding capital stock must be held by at least 100
stockholders. No more than 50% in value of our outstanding capital stock,
including in some circumstances capital stock into which outstanding securities
might be converted, may be owned actually or constructively by five or fewer
individuals or certain other entities at any time during the last half of our
taxable year. Accordingly, our articles of incorporation contain certain
restrictions regarding the transfer of our common stock, preferred stock and any
other outstanding securities convertible into stock when necessary to maintain
our qualification as a REIT under the Code. However, because the Code imposes
broad attribution rules in determining constructive ownership, no assurance can
be given that the restrictions contained in our articles of incorporation will
be effective in maintaining our REIT status. See "Restrictions on Transfers of
Capital Stock."
So long as we qualify for taxation as a REIT, distribute at least 90% of
our REIT taxable income, computed without regard to net capital gain or the
dividends paid deduction, for each taxable year to our stockholders annually and
satisfy certain other distribution requirements, we will not be subject to
federal income tax on that portion of such income distributed to stockholders.
We will be taxed at regular corporate rates on all income not distributed to
stockholders. Our policy is to distribute at least 90% of our taxable income. We
may elect to pass through to our shareholders on a pro rata basis any taxes paid
by us on our undistributed net capital gain income for the relevant tax year.
REITs also may incur taxes for certain other activities or to the extent
distributions do not satisfy certain other requirements.
Our failure to qualify during any taxable year as a REIT could, unless
certain relief provisions were available, have a material adverse effect upon
our stockholders. If disqualified for taxation as a REIT for a taxable year, we
also would be disqualified for taxation as a REIT for the next four taxable
years, unless the failure were considered to be due to reasonable cause and not
willful neglect and certain other conditions were satisfied. We would be subject
to federal income tax at corporate rates on all of our taxable income and would
not be able to deduct any dividends paid, which could result in a
discontinuation of or substantial reduction in dividends to stockholders.
Dividends also would be subject to the regular tax rules applicable to dividends
received by stockholders of corporations. Should the failure to qualify as a
REIT be determined to have occurred retroactively in one of our earlier tax
years, the imposition of a substantial federal income tax liability on us
attributable to any nonqualifying tax years may adversely affect our ability to
pay dividends. In the event that we fail to meet certain income tests applicable
to REITs, we may, generally, nonetheless retain our qualification as a REIT if
we pay a 100% tax on the amount by which we failed to meet the relevant income
-24-
test so long as such failure was considered to be due to reasonable cause and
not willful neglect and certain other conditions are satisfied. Any such taxes
would adversely affect our ability to pay dividends and distributions.
EXPERTS
The consolidated financial statements incorporated in this prospectus by
reference to the Annual Report on Form 10-K for the year ended December 31, 2002
of First Industrial Realty Trust, Inc. have been so incorporated in reliance on
the report of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
LEGAL MATTERS
Certain legal matters will be passed upon for us by Cahill Gordon &
Reindel, New York, New York. Cahill Gordon & Reindel will rely as to all matters
of Maryland law on the opinion of McGuireWoods LLP, Baltimore, Maryland.
WHERE YOU CAN FIND MORE INFORMATION
First Industrial Realty Trust, Inc. is subject to the informational
requirements of the Securities Exchange Act of 1934 and files reports, proxy
statements and other information with the Securities and Exchange Commission.
You may read and copy any of our reports, proxy statements and other information
at, and obtain copies upon payment of prescribed fees from, the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549.
Please contact the Commission at 1-800-SEC-0030 for further information on the
operation of public reference rooms. In addition, the Commission maintains a Web
site that contains reports, proxy and information statements and other
information regarding registrants that file electronically with the Commission
at http://www.sec.gov. First Industrial Realty Trust, Inc.'s common stock is
listed on the New York Stock Exchange and its Commission filings can also be
inspected and copied at the offices of the NYSE at 20 Broad Street, New York,
New York 10005.
This prospectus is a part of a registration statement we filed with the
Commission. As permitted by the Commission, this prospectus does not contain all
the information that you can find in the registration statement or the exhibits
to the registration statement.
We "incorporate by reference" information we file with the Commission,
which means that we can disclose important information to you by referring you
to those documents. The information incorporated by reference is an important
part of this prospectus and more recent information automatically updates and
supersedes more dated information contained or incorporated by reference in this
prospectus.
We have previously filed the following documents with the Commission and
incorporate them by reference in this prospectus (file no. 1-13102):
1) Quarterly Report on Form 10-Q for the quarterly period ended March 31,
2003, filed on May 14, 2003;
2) Current Report on Form 8-K filed on April 24, 2003 (excluding
information furnished pursuant to Item 9 of Form 8-K);
-25-
3) Annual Report on Form 10-K for the year ended December 31, 2002, filed
March 19, 2003; and
4) The description of the common stock included in First Industrial
Realty Trust, Inc.'s registration statement on Form 8-A dated June 23,
1994 and the description of the associated preferred share purchase
rights included in the Form 8-A filed September 24, 1997.
All documents filed by First Industrial Realty Trust, Inc. under Section
13(a), 13(c), 14, or 15(d) of the Exchange Act subsequent to the date of this
prospectus and prior to the termination of this offering shall be deemed to be
incorporated by reference in this prospectus and made a part hereof from the
date of the filing of such documents.
We will provide without charge to each person, including any beneficial
owner, to whom this prospectus is delivered, upon written or oral request, a
copy of these filings or portions of these filings by writing to or calling us
at First Industrial Realty Trust, Inc., Attention: Investor Relations, 311 S.
Wacker Drive, Suite 4000, Chicago, Illinois 60606, telephone (312) 344-4300. The
copies of filings will not include exhibits unless those exhibits are
specifically incorporated by reference into the filing.
-26-
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the estimated expenses in connection with
the issuance and distribution of the securities registered hereby, which will be
borne by First Industrial Realty Trust, Inc. (the "Company"). All amounts shown
are estimates, except the SEC registration fee:
Securities and Exchange Commission registration fee...... $ 405
NYSE fee................................................. 2,500
Legal fees and expenses.................................. 25,000
Accounting fees and expenses............................. 5,000
-------
Total.................................................... $ 32,905
Item 15. Indemnification of Directors and Officers.
The Company's Articles of Incorporation and Bylaws provide certain
limitations on the liability of the Company's directors and officers for
monetary damages to the Company. The Articles of Incorporation and Bylaws
obligate the Company to indemnify its directors and officers, and permit the
Company to indemnify its employees and other agents, against certain liabilities
incurred in connection with their service in such capacities. These provisions
could reduce the legal remedies available to the Company and its stockholders
against these individuals. The provisions of Maryland law provide for the
indemnification of officers and directors of a company under certain
circumstances.
Item 16. Exhibits.
Exhibit
Number Description
------ -----------
4.1 Amended and Restated Articles of Incorporation of the Company (incorporated
by reference to Exhibit 3.1 of the Form 10-Q of the Company for the fiscal
quarter ended June 30, 1996, File No. 1-13102).
4.2 Articles of Amendment to the Company's Articles of Incorporation, dated
June 20, 1994 (incorporated by reference to Exhibit 3.2 of the Form 10-Q of
the Company for the fiscal quarter ended June 30, 1996, File No. 1-13102).
4.3 Articles of Amendment to the Company's Articles of Incorporation, dated May
31, 1996 (incorporated by reference to Exhibit 3.3 of the Form 10-Q of the
Company for the fiscal quarter ended June 30, 1996, File No. 1-13102).
4.4 Articles Supplementary relating to the Company's Junior Participating
Preferred Stock, $.01 par value (incorporated by reference to Exhibit 4.10
of Form S-3/A of the Company and First Industrial, L.P. dated September 24,
1997, File No. 333-29879).
II-1
Exhibit
Number Description
------ -----------
5* Opinion of Cahill Gordon & Reindel, counsel to the Company, as to the
legality of the securities being registered, together with the opinion of
McGuireWoods LLP.
8** Opinion of Cahill Gordon & Reindel, counsel to the Company, as to certain
tax matters.
23.1* Consent of PricewaterhouseCoopers LLP.
23.2 Consent of Cahill Gordon & Reindel (included in Exhibit 5* and Exhibit
8**).
23.3* Consent of McGuireWoods LLP.
24* Power of Attorney.
----------
* Filed previously.
** Filed herewith.
II-2
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) under the Securities
Act of 1933, if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
registration statement or any material change to such information
in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) herein do not
apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed with
or furnished to the Commission by the undersigned registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof; and
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
of-
II-3
fered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the provisions
described under Item 15 above, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a
director, officer, or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Securities Act of 1933 and will be governed by the
final adjudication of such issue.
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to
the registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Chicago, State of Illinois, on May 16,
2003.
FIRST INDUSTRIAL REALTY TRUST, INC.
By: /s/ Michael J. Havala
---------------------------------
Name: Michael J. Havala
Title: Chief Financial Officer
II-5
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
Signature Title Date
--------- ----- ----
* President, Chief Executive May 16, 2003
---------------------------- Officer and Director
Michael W. Brennan (Principal Executive
Officer)
/s/ Michael J. Havala Chief Financial Officer May 16, 2003
---------------------------- (Principal Financial Officer)
Michael J. Havala
* Senior Vice President, Controller May 16, 2003
---------------------------- and Assistant Secretary (Chief
Scott A. Musil Accounting Officer)
* Director of Strategic Planning May 16, 2003
---------------------------- and Director
Michael G. Damone
Director
----------------------------
John L. Lesher
* Director May 16, 2003
----------------------------
Kevin W. Lynch
* Director May 16, 2003
----------------------------
John E. Rau
Chairman of the Board of Directors
----------------------------
Jay H. Shidler
* Director May 16, 2003
----------------------------
Robert J. Slater
* Director May 16, 2003
----------------------------
W. Edwin Tyler
Director
----------------------------
J. Steven Wilson
By: /s/ Michael J. Havala
---------------------------
Michael J. Havala
Attorney-in-Fact
II-6
EXHIBIT INDEX
Exhibit
Number Description
------ -----------
4.1 Amended and Restated Articles of Incorporation of the Company (incorporated
by reference to Exhibit 3.1 of the Form 10-Q of the Company for the fiscal
quarter ended June 30, 1996, File No. 1-13102).
4.2 Articles of Amendment to the Company's Articles of Incorporation, dated
June 20, 1994 (incorporated by reference to Exhibit 3.2 of the Form 10-Q of
the Company for the fiscal quarter ended June 30, 1996, File No. 1-13102).
4.3 Articles of Amendment to the Company's Articles of Incorporation, dated May
31, 1996 (incorporated by reference to Exhibit 3.3 of the Form 10-Q of the
Company for the fiscal quarter ended June 30, 1996, File No. 1-13102).
4.4 Articles Supplementary relating to the Company's Junior Participating
Preferred Stock, $.01 par value (incorporated by reference to Exhibit 4.10
of Form S-3/A of the Company and First Industrial, L.P. dated September 24,
1997, File No. 333-29879).
5* Opinion of Cahill Gordon & Reindel, counsel to the Registrant, as to the
legality of the securities being registered, together with the opinion of
McGuireWoods LLP.
8** Opinion of Cahill Gordon & Reindel, counsel to the Registrant, as to
certain tax matters.
23.1* Consent of PricewaterhouseCoopers LLP.
23.2 Consent of Cahill Gordon & Reindel (included in Exhibit 5* and Exhibit
8**).
23.3* Consent of McGuireWoods LLP.
24* Power of Attorney.
----------
* Filed previously.
** Filed herewith.
II-7
Exhibit 8
[LETTERHEAD OF CAHILL GORDON & REINDEL]
May 16, 2003
Ladies and Gentlemen:
We have acted as tax counsel to First Industrial Realty Trust, Inc. (the
"Company"), in connection with the Form S-3 Registration Statement filed by the
Company with the Securities and Exchange Commission on April 1, 2003, as amended
on May 16, 2003, including the documents incorporated by reference therein and
the prospectus included therein (the "Registration Statement"). We have been
asked to provide our opinion as to certain federal income tax matters arising
under the Internal Revenue Code of 1986, as amended (the "Code"), relating to
the Company's qualification for taxation as a real estate investment trust (a
"REIT") under the Code.
The opinions set forth in this letter are based on relevant provisions of
the Code, Treasury Regulations thereunder and interpretations of the foregoing
as expressed in court decisions and administrative determinations as of the date
hereof. These provisions and interpretations are subject to changes (possibly on
a retroactive basis) that might result in modifications of our opinions.
For purposes of rendering the opinions contained in this letter, we have
reviewed the Registration Statement and such other documents, law and facts as
we have deemed necessary. In our review, we have assumed 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 all
documents submitted to us as copies; and the authenticity of the originals of
any copies.
These opinions also are premised on certain written factual representations
made by the Company in a certificate dated as of the date hereof (the
"Certificate"). For purposes of our opinions, we have not made an independent
investigation of the representations contained in the Certificate, and
consequently we have relied on the representations therein that the information
contained in the Certificate or otherwise furnished to us accurately describes
all material facts relevant to our opinions.
Based upon and subject to the foregoing:
(i) We are of the opinion that, commencing with the Company's taxable
year ended on December 31, 1994, the Company has been organized in
conformity with the requirements for qualification as a REIT under the Code
and the Company's method of operation, as described in the Registration
Statement and as set forth in the Certificate, has enabled it to meet the
requirements for qualification as a REIT under the Code and, provided that
the Company continues to satisfy the applicable asset composition, source
of income, shareholder diversification, distribution, recordkeeping and
other requirements of the Code necessary to qualify as a REIT, it will
continue to so qualify; and
(ii) We hereby confirm the legal conclusions set forth in the
Registration Statement under the heading "Federal Income Tax
Considerations" (the "Tax Section").
We express no opinion other than the opinions expressly set forth herein
(the "Opinions"). The Opinions are not binding on the Internal Revenue Service
(the "IRS") and the IRS may disagree with the Opinions. Although we believe that
the Opinions would be sustained if challenged, there can be no assurance that
this will be the case.
The Opinions are based upon the law as it currently exists. Consequently,
future changes in the law may cause the federal income tax treatment of the
matters referred to herein and in the Tax Section to be materially and adversely
different from that described above and in the Tax Section (possibly on a
retroactive basis). In addition, any variation in the facts from those set forth
in the Registration Statement or the representations contained in the
Certificate or otherwise provided to us may affect the conclusions stated in the
Opinions. Moreover, the Company's qualification and taxation as a REIT depend
upon the Company's ability to meet, through actual operating results,
distribution levels, diversity of stock ownership and various other
qualification tests imposed under the Code, none of which will be reviewed by
us. Accordingly, no assurance can be given that the actual results of the
Company's operations for any taxable year will satisfy the requirements for the
Company to maintain its qualification as a REIT.
Neither this opinion nor any part hereof may be delivered to, or used or
relied upon by, any person other than you without our prior written consent.
Very truly yours,
/s/ CAHILL GORDON & REINDEL LLP
First Industrial Realty Trust, Inc.
311 South Wacker Drive, Suite 4000
Chicago, Illinois 60606