On September 25, 2017, Federal Realty Investment Trust (the
“Company”) entered into an underwriting agreement (the “Underwriting Agreement”) with Merrill Lynch, Pierce, Fenner & Smith Incorporated, UBS Securities LLC and Wells Fargo Securities, LLC, as representatives of the
several underwriters named in Schedule I to the related pricing agreement (the “Underwriters”), pursuant to which the Company agreed to sell through the Underwriters in an underwritten public offering 6,000,000 depositary shares
(“Depositary Shares”), each representing a 1/1000th interest in a 5.000% Series C Cumulative Redeemable Preferred Share of the Company, par value $0.01 per share (the “Series C Preferred Shares”). The Company also granted the
Underwriters a 30-day option to purchase up to 400,000 additional Depositary Shares. The Depositary Shares were offered and sold under a prospectus supplement and related prospectus filed with the Securities and Exchange Commission pursuant to the
Company’s shelf registration statement on Form S-3 (File No. 333-203999). A copy of the Underwriting Agreement is attached hereto as Exhibit 1.1 and is incorporated by reference herein.
On September 28, 2017, the Company filed with the Maryland State Department of Assessments and Taxation Articles Supplementary (the
“Articles Supplementary”) to the Company’s Declaration of Trust (the “Declaration of Trust”), establishing and fixing the rights and preferences of 6,400 of the Company’s Series C Preferred Shares. The Articles
Supplementary are filed as Exhibit 3.1 hereto.
With respect to the payment of dividends and amounts upon liquidation, the Series C
Preferred Shares rank senior to the Company’s common shares and to all other equity securities that, by their terms, rank junior to the Series C Preferred Shares, and on a parity with respect to the Company’s 5.417% Series 1
Cumulative Convertible Preferred Shares (“Series 1 Preferred Shares”). The Series 1 Preferred Shares were the Company’s only outstanding preferred shares prior to the issuance of the Series C Preferred Shares. The Series C Preferred
Shares rank junior to the Company’s currently outstanding indebtedness and any future indebtedness and junior to any equity securities issued by the Company whose senior ranking is consented to by holders of at least two-thirds of the Series C
Preferred Shares outstanding at the time. Additionally, the Company’s ability to make payments of dividends and other amounts due on the Series C Preferred Shares will be structurally subordinated to the indebtedness and other liabilities and
any preferred equity of the Company’s subsidiaries and joint ventures.
Holders of Series C Preferred Shares will be entitled to
receive cumulative cash dividends on the Series C Preferred Shares at the rate of 5.000% of the $25,000.00 per share liquidation preference per year, or $1,250.00 per year per Series C Preferred Share (equal to $1.250 per Depositary
Share). Dividends on the Series C Preferred Shares will be payable, subject to authorization by the Company’s Board of Trustees and declaration by the Company, quarterly in arrears on January 15, April 15, July 15 and
October 15 of each year (or, if any such date is not a business day, on the next succeeding business day), commencing on January 15, 2018.
If the Company liquidates, dissolves or winds up, holders of Series C Preferred Shares will have a right to receive $2,500.00 per Series C
Preferred Share, plus any accrued and unpaid dividends (whether or not declared) to, but excluding, the date of payment, before any payments are made to the holders of our common shares or any other junior securities.
Except in certain circumstances relating to the preservation of the Company’s status as a real estate investment trust
(“REIT”), the Company may not redeem the Series C Preferred Shares prior to September 29, 2022. On or after September 29, 2022, the Company may, at its option, redeem the Series C Preferred Shares (and the depositary will redeem
the
number of Depositary Shares representing the Series C Preferred Shares redeemed) for cash, in whole or in part, at a redemption price of $25,000.00 per Series C Preferred Share (equal to $25.00
per Depositary Share), plus accrued and unpaid dividends, if any, to, but excluding, the redemption date. The Series C Preferred Shares have no stated maturity date and will not be subject to any sinking fund or mandatory redemption (except in
certain circumstances relating to the preservation of the Company’s status as a REIT).
Holders of Series C Preferred Shares
generally have no voting rights. However, if and whenever dividends payable on the Series C Preferred Shares are in arrears for six or more dividend periods, whether or not declared or consecutive, holders of Series C Preferred Shares (voting
together as a class with holders of any other classes or series of preferred shares upon which like voting rights have been conferred and are exercisable) will be entitled to elect two additional trustees to serve on the Company’s Board of
Trustees until the Company pays all accrued and unpaid dividends on the Series C Preferred Shares to which the holders thereof are entitled.
The Series C Preferred Shares and the Depositary Shares are not convertible into or exchangeable for any other property or securities.
On September 29, 2017, the Company closed the offering of 6,000,000 Depositary Shares representing interests in Series C Preferred
Shares. The terms of the Depositary Shares are set forth in the Deposit Agreement, dated as of September 29, 2017, among the Company, American Stock Transfer & Trust Company, LLC, as Depositary, and the holders from time to time of
depositary receipts issued thereunder (the “Deposit Agreement”). The Deposit Agreement is filed as Exhibit 4.1 hereto and incorporated herein by reference. A specimen receipt representing the Depositary Shares is filed as Exhibit 4.3
hereto and incorporated herein by reference.