Up to 5,000,000 shares of Common Stock (par value $0.0001 per share) EQUITY DISTRIBUTION AGREEMENT

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Exhibit 10.1

 

ESSEX PROPERTY TRUST, INC.

Up to 5,000,000 shares

of Common Stock

(par value $0.0001 per share)

August 28, 2014

[Agent]

[Address]

Ladies and Gentlemen:

ESSEX PROPERTY TRUST, INC., a Maryland corporation (the “Company”), confirms its agreement (this “Agreement”) with [_________________] (“[Agent]”), as follows:

The Company agrees that, from time to time during the term of this Agreement, on the terms and subject to the conditions set forth herein, it may issue and sell through [Agent], acting as agent and/or principal, (a) up to 5,000,000 shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”); and (b) such preferred stock as the Company may subsequently designate (the “Preferred Stock”; and together with the Common Stock, the “Shares”).  The Company may also offer to sell the Shares directly to [Agent], as agent or principal, in accordance with Section 5 of this Agreement.  Notwithstanding anything to the contrary contained herein, the parties hereto agree that compliance with the limitation set forth in this Section 1 on the number of Shares issued and sold under this Agreement shall be the sole responsibility of the Company, and [Agent] shall have no obligation in connection with such compliance.  The issuance and sale of Shares through [Agent] will be effected pursuant to the Registration Statement (as defined below) that became automatically effective when filed by the Company with the Securities and Exchange Commission (the “Commission”), although nothing in this Agreement shall be construed as requiring the Company to use the Registration Statement to issue Shares.

The Company has filed, in accordance with the provisions of the Securities Act of 1933, as amended, and the rules and regulations thereunder (collectively, the “Securities Act”), with the Commission a registration statement on Form S-3 (File No. 333-195874), including a base prospectus, relating to certain securities, including the Shares, to be issued from time to time by the Company, and which incorporates by reference documents that the Company has filed or will file in accordance with the provisions of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder (collectively, the “Exchange Act”). The Company has prepared a prospectus supplement specifically relating to the Shares (the “Prospectus Supplement”) to the base prospectus included as part of such registration statement.  The Company has furnished to [Agent], for use by [Agent], copies of the prospectus included as part of such registration statement, as supplemented by the Prospectus Supplement, relating to the Shares.  Except where the context otherwise requires, such registration statement, when it became effective, including all documents filed as part thereof or incorporated by reference therein, and including any information contained in a Prospectus (as defined below) subsequently filed with the Commission pursuant to Rule 424(b) under the Securities Act or deemed to be a part of such registration statement pursuant to Rule 430B or 462(b) of the Securities Act, is herein called the “Registration Statement.”  The base prospectus, including all documents incorporated therein by reference, included in the Registration Statement, as it may be supplemented by the Prospectus Supplement, in the form in which such prospectus and/or Prospectus Supplement have most recently been filed by the Company with the Commission pursuant to Rule 424(b) under the Securities Act, together with any “issuer free writing prospectus,” as defined in Rule 433 of the Securities Act (“Rule 433”), relating to the Shares that (i) is required to be filed with the Commission by the Company or (ii) is exempt from filing pursuant to Rule 433(d)(5)(i), in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g), is herein called the “Prospectus.” Any reference herein to the Registration Statement, the Prospectus or any amendment or supplement thereto shall be deemed to refer to and include the documents incorporated by reference therein, and any reference herein to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement or the Prospectus shall be deemed to refer to and include the filing after the execution hereof of any document with the Commission deemed to be incorporated by reference therein. For purposes of this Agreement, all references to the Registration Statement, the Prospectus or to any amendment or supplement thereto shall be deemed to include any copy filed with the Commission pursuant to either the Electronic Data Gathering Analysis and Retrieval System or Interactive Data Electronic Applications (collectively “IDEA”).

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Any reference herein to the Registration Statement, any Prospectus Supplement, Prospectus or any Free Writing Prospectus shall be deemed to refer to and include the documents, if any, incorporated by reference therein (the “Incorporated Documents”), including, unless the context otherwise requires, the documents, if any, filed as exhibits to such Incorporated Documents. Any reference herein to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement, any Prospectus Supplement, the Prospectus or any Free Writing Prospectus shall be deemed to refer to and include the filing of any document under the Exchange Act on or after the initial effective date of the Registration Statement, or the date of Prospectus Supplement, Prospectus or such Free Writing Prospectus, as the case may be, and incorporated therein by reference.

Each time that the Company wishes to issue and sell the Shares hereunder (each, a “Placement”), it will notify [Agent] by email notice (or other method mutually agreed to in writing by the parties) containing the parameters in accordance with which it desires the Shares to be sold, which shall at a minimum include the number of Shares to be issued (the “Placement Shares”), the time period during which sales are requested to be made, any limitation on the number of Shares that may be sold in any one day and any minimum price per share below which sales may not be made (a “Placement Notice”), a form of which containing such necessary minimum sales parameters is attached hereto as Exhibit A.  The Placement Notice shall originate from any of the individuals from the Company set forth on Exhibit B (with a copy to each of the other individuals from the Company listed on such schedule), and shall be addressed to each of the individuals from [Agent] set forth on Exhibit B, as such Exhibit B may be amended from time to time.  The Placement Notice shall be effective upon receipt by [Agent] unless and until (1) in accordance with the notice requirements set forth herein, [Agent] declines to accept the terms contained therein for any reason, in its sole discretion, (2) the entire amount of the Placement Shares have been sold, (3) in accordance with the notice requirements set forth herein, the Company suspends or terminates the Placement Notice, (4) the Company issues a subsequent Placement Notice with parameters superseding those on the earlier dated Placement Notice, (5) the Agreement has been terminated under the provisions of Section 14 or (6) either party shall have suspended the sale of the Placement Shares in accordance with Section 4 below.  The amount of any discount, commission or other compensation to be paid by the Company to [Agent] in connection with the sale of the Placement Shares shall be calculated in accordance with the terms set forth in Exhibit C.  It is expressly acknowledged and agreed that neither the Company nor [Agent] will have any obligation whatsoever with respect to a Placement or any Placement Shares unless and until the Company delivers a Placement Notice to [Agent] and [Agent] does not decline the terms of such Placement Notice pursuant to the terms set forth above, and then only upon the terms specified therein and herein.  In the event of a conflict between the terms of this Section 2 and the terms of a Placement Notice, the terms of the Placement Notice will control.

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Subject to the provisions of Section 7(a), [Agent], for the period specified in the Placement Notice, will use its commercially reasonable efforts consistent with its normal trading and sales practices and applicable state and federal laws, rules and regulations and the rules of the New York Stock Exchange (the “NYSE”), to sell the Placement Shares up to the amount specified, and otherwise in accordance with the terms of such Placement Notice.  [Agent] will provide written confirmation to the Company (including by email correspondence to each of the individuals at the Company set forth on Exhibit B, if receipt of such correspondence is actually acknowledged by any of the individuals to whom notice is sent, other than via auto reply) no later than the opening of the Trading Day (as defined below) immediately following the Trading Day on which it has made sales of Placement Shares hereunder setting forth the number of Placement Shares sold on such day, the compensation payable by the Company to [Agent] pursuant to Section 2 with respect to such sales, and the Net Proceeds (as defined below) payable to the Company, with an itemization of the deductions made by [Agent] (as set forth in Section 7(b)) from the gross proceeds that it receives from such sales.  Subject to the terms of the Placement Notice, [Agent] may sell Placement Shares by any method permitted by law deemed to be an “at the market” offering as defined in Rule 415 of the Securities Act, including without limitation sales made directly on the NYSE, on any other existing trading market for the Common Stock or to or through a market maker.  Subject to the terms of a Placement Notice, [Agent] may also sell Placement Shares by any other method permitted by law, including but not limited to in privately negotiated transactions.  For the purposes hereof, “Trading Day” means any day on which shares of Common Stock are purchased and sold on the principal market on which the Common Stock is listed or quoted.

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The Company or [Agent] may, upon notice to the other party in writing (including by email correspondence to each of the individuals of the other party set forth on Exhibit B, if receipt of such correspondence is actually acknowledged by any of the individuals to whom the notice is sent, other than via auto-reply) or by telephone (confirmed immediately by verifiable email correspondence to each of the individuals of the other party set forth on Exhibit B), suspend the sale of Shares under this Agreement; provided, however, that such suspension shall not affect or impair either party’s obligations with respect to any Placement Shares sold hereunder prior to the receipt of such notice.  Each of the parties agrees that no such notice under this Section 4 shall be effective against the other unless it is made to one of the individuals named on Exhibit B hereto, as such exhibit may be amended from time to time.

The Company may also offer to sell the Shares directly to [Agent] as principal, in which event such parties shall enter into a separate agreement (each, a “Terms Agreement”) in substantially the form of Schedule I hereto, related to such sale (each such transaction, a “Principal Transaction”).  If the Company wishes to issue and sell the Shares pursuant to this Agreement but other than as set forth in Section 2 of this Agreement, it will notify [Agent] of the proposed terms of the Principal Transaction.  If [Agent], acting as principal, wishes to accept such proposed terms (which it may decline to do for any reason in its sole discretion) or, following discussions with the Company, wishes to accept amended terms, the Company and [Agent] shall enter into a Terms Agreement setting forth the terms of such Principal Transaction.  The terms set forth in a Terms Agreement shall not be binding on the Company or [Agent] unless and until the Company and [Agent] have each executed such Terms Agreement accepting all of the terms of such Terms Agreement.  In the event of a conflict between the terms of this Agreement and the terms of a Terms Agreement, the terms of such Terms Agreement shall control.  A Terms Agreement may also specify certain provisions relating to the reoffering of such Shares by [Agent].  The commitment of [Agent] to purchase the Shares pursuant to any Terms Agreement shall be deemed to have been made on the basis of the representations, warranties and agreements of the Company herein contained and shall be subject to the terms and conditions herein set forth.  Any such Terms Agreement shall specify the number of the Shares to be purchased by [Agent] pursuant thereto, the price to be paid to the Company for such Shares, any provisions relating to rights of, and default by, underwriters acting together with [Agent] in the reoffering of the Shares, and the Settlement Date (as defined below) and place of delivery of and payment for such Shares.  Whenever the Company determines to sell the Shares directly to an Alternate Manager (as defined in Section 6(b) below) as principal, it will enter into a separate agreement (each, an “Alternate Terms Agreement”) in substantially the form of Schedule I to the Alternate Distribution Agreements (as defined in Section 22 below).

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Any certificate signed by an officer of the Company and delivered to [Agent] or to counsel for [Agent] shall be deemed to be a representation and warranty by the Company to [Agent] as to the matters set forth therein.

The Company acknowledges that [Agent] and, for purposes of the opinions to be delivered pursuant to Section 8 hereof, counsel to the Company and counsel to [Agent], will rely upon the accuracy and truthfulness of the foregoing representations and hereby consents to such reliance.

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The Company covenants with [Agent] as follows:

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(i)

files the Prospectus relating to the Shares or amends or supplements (other than a prospectus supplement relating solely to an offering of securities other than the Shares) the Registration Statement or the Prospectus relating to the Shares by means of a post-effective amendment, sticker, or supplement but not by means of incorporation of documents by reference into the Registration Statement or the Prospectus relating to the Shares;

(ii)

files an annual report on Form 10-K under the Exchange Act (including any Form 10-K/A containing amended financial information or a material amendment to the previously filed Form 10-K);

(iii)

files its quarterly reports on Form 10-Q under the Exchange Act;

(iv)

files a current report on Form 8-K containing amended financial information (other than information “furnished” pursuant to Items 2.02 or 7.01 of Form 8-K or to provide disclosure pursuant to Item 8.01 of Form 8-K relating to the reclassification of certain properties as discontinued operations in accordance with Statement of Financial Accounting Standards No. 144) under the Exchange Act;

(v)

each date on which the Company executes and delivers a Terms Agreement; or

(vi)

each Settlement Date with respect to a Principal Transaction,

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each date of filing of one or more of the documents referred to in clauses (i) through (iv), and each of the dates referred to in clauses (v) and (vi), shall be a “Representation Date”; provided however, notwithstanding anything to the contrary contained in this Agreement, [Agent] may waive any documents required to be delivered to [Agent] as a result of a Representation Date,

the Company shall furnish [Agent] with a certificate, in the form attached hereto as Exhibit D within three (3) Trading Days of any Representation Date.  The requirement to provide a certificate under this Section 8(n) shall be waived for any Representation Date occurring at a time at which no Placement Notice is pending, which waiver shall continue until the earlier to occur of the date the Company delivers a Placement Notice hereunder (which for such calendar quarter shall be considered a Representation Date) and the next occurring Representation Date; provided, however, that such waiver shall not apply for any Representation Date on which the Company files its annual report on Form 10-K or a Representation Date with respect to a Principal Transaction.  Notwithstanding the foregoing, if the Company subsequently decides to sell Placement Shares following a Representation Date when the Company relied on such waiver and did not provide [Agent] with a certificate under this Section 8(n), then before the Company delivers the Placement Notice or [Agent] sells any Placement Shares, the Company shall provide [Agent] with a certificate, in the form attached hereto as Exhibit D, dated the date of the Placement Notice.

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Section 9.                 Payment of Expenses.

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In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in Section 11 is applicable in accordance with its terms but for any reason is held to be unavailable from the Company or [Agent], the Company and [Agent] will contribute to the total losses, claims, liabilities, expenses and damages (including any investigative, legal and other expenses reasonably incurred in connection with, and any amount paid in settlement of, any action, suit or proceeding or any claim asserted, but after deducting any contribution received by the Company from persons other than [Agent], such as persons who control the Company within the meaning of the Securities Act, officers of the Company who signed the Registration Statement and directors of the Company, who also may be liable for contribution) to which the Company and [Agent] may be subject in such proportion as shall be appropriate to reflect the relative benefits received by the Company on the one hand and [Agent] on the other.  The relative benefits received by the Company on the one hand and [Agent] on the other hand shall be deemed to be in the same proportion as the total Net Proceeds from the sale of the Placement Shares (or Shares sold pursuant to a Terms Agreement, if applicable) (before deducting expenses) received by the Company bear to the total compensation received by [Agent] from the sale of such Shares on behalf of the Company.  If, but only if, the allocation provided by the foregoing sentence is not permitted by applicable law, the allocation of contribution shall be made in such proportion as is appropriate to reflect not only the relative benefits referred to in the foregoing sentence but also the relative fault of the Company, on the one hand, and [Agent], on the other, with respect to the statements or omission that resulted in such loss, claim, liability, expense or damage, or action in respect thereof, as well as any other relevant equitable considerations with respect to such offering. Such relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or [Agent], the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such statement or omission.  The Company and [Agent] agree that it would not be just and equitable if contributions pursuant to this Section 12 were to be determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, liability, expense, or damage, or action in respect thereof, referred to above in this Section 12 shall be deemed to include, for the purpose of this Section 12, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim to the extent consistent with Section 11(c) hereof.  Notwithstanding the foregoing provisions of this Section 12, [Agent] shall not be required to contribute any amount in excess of the commissions received by it under this Agreement and no person found guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 12, any person who controls [Agent] within the meaning of the Securities Act, and any affiliates, officers, directors, partners, employees or agents of [Agent], will have the same rights to contribution as [Agent], and any person who controls the Company within the meaning of the Securities Act, each director of the Company, and each officer of the Company who signed the Registration Statement will have the same rights to contribution as the Company, subject in each case to the provisions hereof. Any party entitled to contribution, promptly after receipt of notice of commencement of any action against such party in respect of which a claim for contribution may be made under this Section 12, will notify any such party or parties from whom contribution may be sought, but the omission to so notify will not relieve that party or parties from whom contribution may be sought from any other obligation it or they may have under this Section 12 except to the extent that the failure to so notify such other party materially prejudiced the substantive rights or defenses of the party from whom contribution is sought. Except for a settlement entered into pursuant to the last sentence of Section 11(c) hereof, no party will be liable for contribution with respect to any action or claim settled without its written consent if such consent is required pursuant to Section 11(c) hereof.

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All representations, warranties and agreements contained in this Agreement or in certificates of officers of the Company or any of its Subsidiaries submitted pursuant hereto or pursuant to any Terms Agreement, shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of [Agent] or its controlling persons, or by or on behalf of the Company, and shall survive delivery of the Shares to [Agent].

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All notices or other communications required or permitted to be given by any party to any other party pursuant to the terms of this Agreement or any Terms Agreement shall be in writing, unless otherwise specified in this Agreement.  Notices to [Agent] shall be directed to [__________], [__________] fax no. [__________], Attention: [__________], with copies to Sidley Austin LLP, 1001 Page ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, fax no. (▇▇▇) ▇▇▇-▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇; notices to the Company shall be delivered to Essex Property Trust, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, fax no. (▇▇▇) ▇▇▇-▇▇▇▇, attention: ▇▇▇▇▇▇▇ Dance, Chief Financial Officer, with a copy to ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇^▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, fax no. (▇▇▇) ▇▇▇-▇▇▇▇, attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.  Each party to this Agreement may change such address for notices by sending to the parties to this Agreement written notice of a new address for such purpose. Each such notice or other communication shall be deemed given (i) when delivered personally or by verifiable electronic transmission (with an original to follow) on or before 4:30 p.m., New York City time, on a Business Day (as defined below), or, if such day is not a Business Day on the next succeeding Business Day, (ii) on the next Business Day after timely delivery to a nationally-recognized overnight courier and (iii) on the Business Day actually received if deposited in the U.S. mail (certified or registered mail, return receipt requested, postage prepaid). For purposes of this Agreement, “Business Day” shall mean any day on which the NYSE and commercial banks in the City of New York are open for business.

This Agreement and any Terms Agreement shall inure to the benefit of and be binding upon [Agent], the Company and their respective successors and affiliates.  Nothing expressed or mentioned in this Agreement or any Terms Agreement is intended or shall be construed to give any person, firm or corporation, other than [Agent], the Company and their respective successors and affiliates and the controlling persons and officers and directors referred to in Sections 10 and 11 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement, any Terms Agreement, or any provision herein or therein contained.  This Agreement, any Terms Agreement, and all conditions and provisions hereof and thereof are intended to be for the sole and exclusive benefit of [Agent], the Company and their respective successors and affiliates, and said controlling persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation.  No purchaser of Shares from [Agent] shall be deemed to be a successor by reason merely of such purchase.

The parties acknowledge and agree that all stock-related numbers contained in this Agreement and any Terms Agreement shall be adjusted to take into account any stock split, stock dividend or similar event effected with respect to the Shares.

THIS AGREEMENT AND ANY TERMS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME. EACH OF THE COMPANY AND [AGENT] HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY TERMS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

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The Section and Exhibit headings herein and in any Terms Agreement are for convenience only and shall not affect the construction hereof or thereof.

As used in this Agreement, the following terms have the respective meanings set forth below:

“Alternate Distribution Agreements” means the Equity Distribution Agreements, entered into as of this date, between the Company and each of the Alternate Managers.

“Applicable Time” means the time (a) each Placement Notice is given hereunder and (b) each sale of any Shares is made.

“Issuer Free Writing Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433, relating to the Shares that (1) is required to be filed with the Commission by the Company, (2) is a “road show” that is a “written communication” within the meaning of Rule 433(d)(8)(i) whether or not required to be filed with the Commission, or (3) is exempt from filing pursuant to Rule 433(d)(5)(i) because it contains a description of the Shares or of the offering that does not reflect the final terms, and all free writing prospectuses that are listed in Exhibit F hereto, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g) under the Securities Act.

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“Preferred Stock” means the Company’s preferred stock, par value $0.0001 per share.

“Rule 172,” “Rule 405,” “Rule 415,” “Rule 424,” “Rule 424(b),” “Rule 430B,” and “Rule 433” refer to such rules under the Securities Act.

All references in this Agreement to financial statements and schedules and other information that is “contained,” “included” or “stated” in the Registration Statement or the Prospectus (and all other references of like import) shall be deemed to mean and include all such financial statements and schedules and other information that is incorporated by reference in the Registration Statement or the Prospectus, as the case may be.

All references in this Agreement or any Terms Agreement to the Registration Statement, the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to IDEA; all references in this Agreement to any Issuer Free Writing Prospectus (other than any Issuer Free Writing Prospectuses that, pursuant to Rule 433, are not required to be filed with the Commission) shall be deemed to include the copy thereof filed with the Commission pursuant to IDEA; and all references in this Agreement or any Terms Agreement to “supplements” to the Prospectus shall include, without limitation, any supplements, “wrappers” or similar materials prepared in connection with any offering, sale or private placement of any Shares by [Agent] outside of the United States.

The Company represents, warrants and agrees that, unless it obtains the prior consent of [Agent], and [Agent] represents, warrants and agrees that, unless it obtains the prior consent of the Company, it has not made and will not make any offer relating to the Shares that would constitute an Issuer Free Writing Prospectus, or that would otherwise constitute a “free writing prospectus,” as defined in Rule 405, required to be filed with the Commission.  Any such free writing prospectus consented to by [Agent] or by the Company, as the case may be, is hereinafter referred to as a “Permitted Free Writing Prospectus.”  The Company represents and warrants that it has treated and agrees that it will treat each Permitted Free Writing Prospectus as an “issuer free writing prospectus,” as defined in Rule 433, and has complied and will comply with the requirements of Rule 433 applicable to any Permitted Free Writing Prospectus, including timely filing with the Commission where required, legending and record keeping.  For the purposes of clarity, the parties hereto agree that all free writing prospectuses, if any, listed in Exhibit F hereto are Permitted Free Writing Prospectuses.

The Company acknowledges and agrees that:

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This Agreement and any Terms Agreement supersedes all prior agreements and understandings (whether written or oral) between the Company and [Agent], or any of them, with respect to the subject matter hereof or thereof.  None of this Agreement, any Terms Agreement, or any term hereof or thereof may be amended except pursuant to a written instrument executed by the Company and [Agent].  In the event that any one or more of the provisions contained herein or in any Terms Agreement, or the application thereof in any circumstance, is held invalid, illegal or unenforceable as written by a court of competent jurisdiction, then such provision shall be given full force and effect to the fullest possible extent that it is valid, legal and enforceable, and the remainder of the terms and provisions herein or in the relevant Terms Agreement shall be construed as if such invalid, illegal or unenforceable term or provision was not contained herein, but only to the extent that giving effect to such provision and the remainder of the terms and provisions hereof shall be in accordance with the intent of the parties as reflected in this Agreement and in any Terms Agreement.  In the event of a conflict between the terms of this Agreement and the terms of a Terms Agreement, the terms of such Terms Agreement shall control.

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This Agreement and any Terms Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  Delivery of an executed Agreement or Terms Agreement by one party to the other may be made by facsimile, electronic or pdf transmission.

[Remainder of Page Intentionally Blank]

 

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If the foregoing correctly sets forth the understanding among the Company and [Agent], please so indicate in the space provided below for that purpose, whereupon this Agreement and your acceptance shall constitute a binding agreement between the Company and [Agent].

Very truly yours,

	ESSEX PROPERTY TRUST, INC.
	By:
	Name:	▇▇▇▇▇▇▇ ▇. Dance
	Title:	Executive Vice President and Chief Financial Officer

ACCEPTED as of the date

first-above written:

[AGENT]

Name:

Title:

[Signature Page to

Equity Distribution Agreement]

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From:	[                              ]
Cc:	[                              ]
To:	[                              ]

Gentlemen:

Pursuant to the terms and subject to the conditions contained in the Equity Distribution Agreement between Essex Property Trust, Inc. (the “Company”), and [Agent] (“[Agent]”), dated August 28, 2014 (the “Agreement”), I hereby request on behalf of the Company that [Agent] sell up to [ ] shares of the Company’s common stock, par value $0.0001 per share, at a minimum market price of $_______ per share.

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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇

▇▇▇▇▇▇▇ ▇. Dance

▇▇▇▇ ▇. ▇▇▇▇

[__________]

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[Agent] shall be paid compensation equal to up to two percent (2%) of the gross proceeds from the sales of the Shares sold by [Agent] pursuant to the terms of this Agreement.

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The undersigned, the duly qualified and elected _______________________, of ESSEX PROPERTY TRUST, INC. (“Company”), a Maryland corporation, does hereby certify in such capacity and on behalf of the Company, pursuant to Section 8(n) of the Equity Distribution Agreement dated August 28, 2014 (the “Agreement”) between the Company and [Agent] (“[Agent]”):

	By:
		Name:
		Title:

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MATTERS TO BE COVERED BY INITIAL OPINION OF

▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP

AND ON THE SETTLEMENT DATES OF ANY PRINCIPAL TRANSACTION AND EACH TIME THE COMPANY FILES A FORM 10-K¹

(i)

As of December 31, 2013, the authorized capitalization of the Company was as set forth under the caption “Description of Capital Stock” in the Prospectus.  The Company’s Common Stock and 7.125% Series H Cumulative Redeemable Preferred Stock conform as to legal matters in all material respects to the descriptions thereof contained in the two foregoing captions.

(ii)

The Company is a corporation duly incorporated and existing under and by virtue of the laws of the State of Maryland and is in good standing with the State Department of Assessments and Taxation of Maryland.  The Company has the corporate power to own, lease and operate its properties and conduct its business in all material respects as described under the headings “Item 1 Business” and “Item 2 Properties” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.  The Operating Partnership is validly existing as a limited partnership in good standing under the laws of the jurisdiction of its incorporation or organization with the power to own, lease and operate its properties.

(iii)

To the knowledge of such counsel, the Company and the Operating Partnership, a California limited partnership as to which the Company is the general partner, is duly qualified or registered to transact business in each jurisdiction set forth on Schedule 1 hereto, which are, to the knowledge of such counsel, the only states within the United States in which the Company owns or leases material property, maintains offices, has employees or otherwise conducts any material business.  To such counsel’s knowledge, other than the Company’s interests in the Subsidiaries or as disclosed in the Prospectus, the Company does not own, directly or indirectly, any capital stock or other equity securities of any other corporation or any ownership interest in any limited liability company, partnership, joint venture or other association.

(iv)

The execution, delivery and performance of the Equity Distribution Agreement (the “Agreement”) by the Company and the consummation of the transactions contemplated thereby do not conflict with, or result in any breach of, or constitute a default under (nor constitute an event that with notice, lapse of time or both would constitute a breach of or default under), (i) the charter or bylaws of the Company, (ii) any agreement listed on Exhibits 10.1 through 10.[ ] to the Company’s Annual Report on Form 10-K for the year ended December 31, 2013 or (iii) to our knowledge, any Applicable Law or any decree, judgment or order applicable to the Company (other than state and foreign securities or blue sky laws, as to which we express no opinion), except in the case of clauses (ii) and (iii) for such conflicts, breaches or defaults, which individually or in the aggregate could not be reasonably expected to have a Material Adverse Change.

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¹  Or any amendment to the Form 10-K.

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(v)

The Company has the corporate power to execute and deliver the Agreement and to issue, sell and deliver the Shares as contemplated in the Agreement.  The Agreement has been duly authorized, executed and, so far as is known to us, delivered by the Company.

(vi)

No approval, authorization, consent or order of, or filing with, any federal or state governmental or regulatory commission, board, body, authority or agency is required under Applicable Law in connection with the execution, delivery and performance of the Agreement, or the consummation of the transactions contemplated thereby, by the Company, other than such as have been obtained or made under the Securities Act or the Securities Exchange Act of 1934, as amended, and such approvals as have been obtained in connection with the listing of the Placement Shares on the New York Stock Exchange (the “Exchange”); provided, however, that we do not express any opinion as to any necessary qualification under the securities or blue sky laws of the various jurisdictions in which the Shares are being offered by [Agent] or any approval of the underwriting terms and arrangements relating to the offering of the Shares by the Financial Industry Regulatory Authority (“FINRA”).

(vii)

The Shares, when issued and delivered by the Company pursuant to the resolutions of the Company’s Board of Directors approving such issuance (and any other resolutions adopted by committees of the Board, as contemplated by the Board’s resolutions) and the Agreements against payment of the consideration set forth therein, will be (assuming that upon such issuance the total number of shares of Common Stock issued and outstanding will not exceed the total number of shares of Common Stock that the Company is then authorized to issue under its charter) duly authorized, validly issued, fully paid and nonassessable.

(viii)

The issuance and sale of the Shares by the Company is not subject to preemptive or other similar rights arising by operation of the Maryland General Corporation Law under the charter or bylaws of the Company or under any agreement known to us to which the Company is a party.

(ix)

To our knowledge, except as otherwise described in the Registration Statement, the Prospectus, the documents incorporated therein by reference or the exhibits filed in connection therewith, there are no persons with registration or other similar rights to have any securities registered pursuant to the Registration Statement.

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(x)

At the time the Registration Statement became effective, the Registration Statement and, as of the date of the Agreement and the date hereof, the Prospectus (in each case, other than the financial statements, financial schedules and other financial and statistical data included or incorporated by reference in, or excluded from, the Registration Statement and the Prospectus, as to which we express no opinion) complied as to form in all material respects with the requirements of the Securities Act and the rules and regulations promulgated thereunder.

(xi)

The statements under the caption “Description of Capital Stock” in the Prospectus, insofar as such statements constitute a summary of the legal matters referred to therein, constitute accurate summaries thereof in all material respects as of the date of such statements.

(xii)

To our knowledge, there are no actions, suits or proceedings or inquiries or investigations, pending or threatened, against the Company or any of its officers and directors or to which the Company’s assets (excluding the Company’s direct or indirect interests in the Subsidiaries) are subject, at law or in equity, before or by any federal, state, local or foreign governmental or regulatory commission, board, body, authority, arbitration panel or agency that are required to be described in the Prospectus or the documents incorporated therein by reference but are not so described.

(xiii)

The Company is not an “investment company” required to register under the Investment Company Act of 1940, as amended, (the “1940 Act”) or a company “controlled” by an “investment company” within the meaning of the 1940 Act.

(xiv)

The Shares to be issued and sold by the Company pursuant to the Agreement are duly listed, and admitted and authorized for trading, subject to official notice of issuance, on the Exchange.

The Registration Statement became automatically effective under the Securities Act on May 12, 2014 and, to our knowledge, no stop order suspending the effectiveness of the Registration Statement has been issued under the Securities Act or proceedings therefor initiated or threatened by the Commission.

In addition, we have reviewed the Registration Statement and the Prospectus and participated in conferences with officers and other representatives of the Company, representatives of independent public accountants for the Company at which the contents of the Registration Statement and the Prospectus and related matters were discussed, and although we are not passing upon, and do not assume any responsibility for, the accuracy, completeness or fairness of the statements contained or incorporated by reference in the Registration Statement and the Prospectus and have not made any independent check or verification thereof, during the course of such participation, nothing has come to our attention that leads us to believe that the Registration Statement, at the time such Registration Statement became effective or was deemed to have become effective under Section 11(d) of the Securities Act and Rule 430B thereunder, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that the Prospectus, as supplemented by the Prospectus Supplement, as of the date of the Agreement or the date hereof, included or includes an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading (it being understood that in each case we express no view or belief with respect to the financial statements, financial schedules and other financial or statistical data included or incorporated by reference in, or excluded from, the Registration Statement or the Prospectus).

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The limitations inherent in the independent verification of factual matters and the character of determinations involved in the preparation of a disclosure document are such, however, that we do not assume any responsibility, except as otherwise stated in opinion (xi) and (xvi) above, for the accuracy, completeness or fairness of the statements contained in the Registration Statement or Prospectus or any amendments or supplements thereto (including any of the documents incorporated by reference therein).

In rendering such opinion, such counsel may rely (A) as to matters involving the application of laws of any jurisdiction other than the California Corporations Code or the federal law of the United States, to the extent they deem proper and specified in such opinion, upon the opinion (which shall be satisfactory in form and substance to the Manager, shall expressly state that the Manager and Manager’s counsel may rely on such opinion as if the opinion were addressed to them and shall be furnished to the Manager) of other counsel of good standing whom they believe to be reliable and who are satisfactory to counsel for the Manager; provided, however, that such counsel shall further state that they believe that they, the Manager and the Manager’s counsel are justified in relying upon such opinion of other counsel, and (B) as to matters of fact, to the extent they deem proper, on certificates of responsible officers of the Company and public officials.

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MATTERS TO BE COVERED BY

SUBSEQUENT COMPANY COUNSEL OPINIONS¹

(i)

The Registration Statement, when it became effective, and the Prospectus and any amendment or supplement thereto, on the date of filing thereof with the Commission, complied as to form in all material respects with the requirements for registration statements on Form S-3 under the Securities Act and the rules and regulations of the Commission thereunder, and each of the documents incorporated by reference in the Registration Statement or the Prospectus, or any amendment or supplement thereto, on the date of filing thereof with the Commission, complied as to form in all material respects with the requirements of the Exchange Act and the rules and regulations of the Commission thereunder; it being understood, however, that we express no opinion with respect to the financial statements, schedules or other financial or statistical data included or incorporated by reference in, or omitted from, the Registration Statement or the Prospectus or any other document.

(ii)

To our knowledge and other than as set forth in the Prospectus or in a document incorporated by reference into the Prospectus, there are no legal or governmental proceedings, pending or threatened, to which the Company is a party that are required to be described in the Prospectus or the  documents incorporated therein by reference but are not so described.

The Registration Statement became effective under the Securities Act on May 12, 2014 and, to our knowledge, no stop order suspending the effectiveness of the Registration Statement has been issued under the Securities Act and no proceeding for that purpose has been instituted by the Commission.

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In addition, we have participated in conferences with officers and other representatives of the Company, representatives of the independent public accountants for the Company, and your representatives, at which the contents of the Registration Statement and the Prospectus and related matters were discussed and, although we are not passing upon, and do not assume any responsibility for, the accuracy, completeness or fairness of the statements contained or incorporated by reference in the Registration Statement and the Prospectus and have not made any independent check or verification thereof, during the course of such participation, no facts came to our attention that caused us to believe that the Registration Statement, at the time it became effective or was deemed to have become effective under Section 11(d) of the Securities Act and Rule 430B thereunder, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, or that the Prospectus (including the documents incorporated therein by reference), as of its date, contained an untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; it being understood that we express no belief with respect to the financial statements, schedules and other financial and statistical data included or incorporated by reference in or omitted from the Registration Statement or the Prospectus.

 

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MATTERS TO BE COVERED BY

OPINION OF ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP

For its taxable year ended December 31, 2009 through its taxable year ended December 31, 2013, the Company has been organized and has operated in conformity with the requirements for qualification and taxation as a REIT under the Code, and its organization and proposed method of operation will enable it to continue to meet the requirements for qualification and taxation as a REIT; and

The statements contained under the caption “Material Federal Income Tax Considerations” in the Prospectus that is contained in the Registration Statement, and under the caption “Supplemental Material Federal Income Tax Considerations” in the Prospectus Supplement, insofar as such statements constitute matters of law, summaries of U.S. federal income tax law or regulation or legal conclusions with respect thereto, have been reviewed by us, and constitute accurate summaries of, and fairly present, the matters described therein in all material respects.

Such opinion may also set forth assumptions, qualifications and limitations on which the opinions stated therein are based and to which they are subject, which shall be reasonably satisfactory to counsel to the Managers.

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ESSEX PROPERTY TRUST, INC.

[Common Stock]

TERMS AGREEMENT

_____________, 20[14]

[AGENT]

[Address]

Ladies and Gentlemen:

Essex Property Trust, Inc.,  a Maryland corporation (the “Company”), proposes, subject to the terms and conditions stated herein and in the Equity Distribution Agreement, dated August 28, 2014 (the “Distribution Agreement”), between the Company and [Agent] (“[Agent]”), to issue and sell to [Agent] the securities specified in the Schedule hereto (the “Purchased Securities”) [, and solely for the purpose of covering over-allotments, to grant to [Agent] the option to purchase the additional securities specified in the Schedule hereto (the “Additional Securities”)].  Unless otherwise defined below, capitalized terms defined in the Distribution Agreement shall have the same meanings when used herein.

[To be included if parties agree on an option to cover over-allotments:  [Agent] shall have the right to purchase from the Company all or a portion of the Additional Securities as may be necessary to cover over-allotments made in connection with the offering of the Purchased Securities, at the same purchase price per share to be paid by [Agent] to the Company for the Purchased Securities.  This option may be exercised by [Agent] at any time (but not more than once) on or before the thirtieth day following the date hereof, by written notice to the Company.  Such notice shall set forth the aggregate number of shares of Additional Securities as to which the option is being exercised, and the date and time when the Additional Securities are to be delivered (such date and time being herein referred to as the “Option Settlement Date”); provided, however, that the Option Settlement Date shall not be earlier than the Settlement Date (as set forth in the Schedule hereto) nor earlier than the second business day after the date on which the option shall have been exercised nor later than the fifth business day after the date on which the option shall have been exercised.  Payment of the purchase price for the Additional Securities shall be made at the Option Settlement Date in the same manner and at the same office as the payment for the Purchased Securities.]

Each of the provisions of the Distribution Agreement not specifically related to the solicitation by [Agent], as agent of the Company, of offers to purchase securities is incorporated herein by reference in its entirety, and shall be deemed to be part of this Terms Agreement to the same extent as if such provisions had been set forth in full herein.  Each of the representations, warranties and agreements set forth therein shall be deemed to have been made as of the date of this Terms Agreement [and] [,] the Settlement Date [and any Option Settlement Date].

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[An amendment to the Registration Statement (as defined in the Distribution Agreement), or a supplement to the Prospectus, as the case may be, relating to the Purchased Securities [and the Additional Securities], in the form heretofore delivered to [Agent] is now proposed to be filed with the Commission.]

Subject to the terms and conditions set forth herein and in the Distribution Agreement which are incorporated herein by reference, the Company agrees to issue and sell to [Agent] and the latter agrees to purchase from the Company, the Purchased Securities at the time and place and at the purchase price set forth in the Schedule hereto.

Notwithstanding any provision of this Agreement or any Terms Agreement to the contrary, the Company consents to [Agent] trading in the Common Stock for [Agent]’ own account and for the accounts of its clients at the same time as sales of the Shares occur pursuant to this Agreement.

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If the foregoing is in accordance with your understanding, please sign and return to us a counterpart hereof, whereupon this Terms Agreement, including those provisions of the Distribution Agreement incorporated herein by reference, shall constitute a binding agreement between [Agent] and the Company.

	ESSEX PROPERTY TRUST, INC.
	By:
	Name:
	Title:

ACCEPTED as of the date

first-above written:

[AGENT]

Name:

Title:

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SCHEDULE TO TERMS AGREEMENT

Title of Purchased Securities [and Additional Securities]:

[•]

Number of Shares of Purchased Securities:

[•]

[Number of Shares of Additional Securities:]

[•]

[Price to Public:]

[•]

Purchase Price by [Agent]:

[•]

Method of and Specified Funds for Payment of Purchase Price:

[By wire transfer to a bank account specified by the Company in same day funds.]

Method of Delivery:

[To [Agent]’ account, or the account of [Agent]’ designee, at The Depository Trust Company via DWAC in return for payment of the purchase price.]

Settlement Date:

[•], 20[14]

Closing Location:

[•]

Documents to be Delivered:

The following documents referred to in the Distribution Agreement shall be delivered (unless otherwise waived) as a condition to the closing (which documents shall be dated on or as of the date of the Terms Agreement to which this Schedule is annexed):

(1)	the officer’s certificate referred to in Section 8(n);

(2)	the opinions referred to in Sections 8(o);

(3)	the “comfort” letters referred to in Section 8(p); and

(4)	such other documents as [Agent] shall reasonably request.

[Lockup:]

[•]

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