Exhibit 99.1**RISK FACTORS****RISKS RELATED TO REAL ESTATE INVESTMENTS****We invest primarily in regional mall shopping centers and other retail properties, which aresubject to a number of significant risks which are beyond our control**Real property investments are subject to varying degrees of risk that may affect the ability of ourretail properties to generate sufficient revenues. A number of factors may decrease the incomegenerated by a retail property, including:**•** the regional and local economy, which may be negatively impacted by plant closings, industry slowdowns, adverse weatherconditions, natural disasters and other factors;**•** local real estate conditions, such as an oversupply of, or a reduction in demand for, retail space or retail goods, andthe availability and creditworthiness of current and prospective tenants;**•** perceptions by retailers or shoppers of the safety, convenience and attractiveness of the retail property;**•** the convenience and quality of competing retail properties and other retailing options such as the Internet;**•** changes in laws and regulations applicable to real property, including tax and zoning laws; and**•** changes in interest rate levels and the availability and cost of financing.If we are unable to generate sufficient revenue from our retail properties, including those held byjoint ventures, we will be unable to meet operating and other expenses, including debt service,lease payments, capital expenditures and tenant improvements, and to make distributions from ourjoint ventures and then, in turn, to our stockholders.**We depend on leasing space to tenants on economically favorable terms and collecting rent fromthese tenants, who may not be able to pay**Our results of operations will depend on our ability to continue to lease space in our propertieson economically favorable terms. If the sales of stores operating in our centers declinesufficiently, tenants might be unable to pay their existing minimum rents or expense recoverycharges, since these rents and charges would represent a higher percentage of their sales. If ourtenants’ sales decline, new tenants would be less likely to be willing to pay minimum rents as highas they would otherwise pay. In addition, as substantially all of our income is derived fromrentals of real property, our income and cash available for distribution to our stockholders wouldbe adversely affected if a significant number of tenants were unable to meet their obligations tous. During times of economic recession, these risks will increase.**Bankruptcy or store closures of tenants may decrease our revenues and available cash**A number of companies in the retail industry, including some of our tenants, have declaredbankruptcy or voluntarily closed certain of their stores in recent years. The bankruptcy or closureof a major tenant, particularly an Anchor tenant, may have a material adverse effect on the retailproperties affected and the income produced by these properties and may make it substantially moredifficult to lease the remainder of the affected retail properties. Our leases generally do notcontain provisions designed to ensure the creditworthiness of the tenant. As a result, thebankruptcy or closure of a major tenant could result in a lower level of cash available fordistribution to our stockholders.
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**We may be negatively impacted by department store consolidations**Department store consolidations, such as K-Mart’s acquisition of Sears and Federated’s pendingacquisition of May Department Stores may result in the closure of existing department stores and wemay be unable to re-lease this area or to re-lease it on comparable or more favorable terms. Othertenants may be entitled to modify the terms of their existing leases in the event of such closures.Additionally, department store closures could result in decreased customer traffic which couldlead to decreased sales at other stores. Rents obtained from other tenants may also be adverselyimpacted. Consolidations may also negatively affect current and future development andredevelopment projects**It may be difficult to buy and sell real estate quickly, and transfer restrictions apply to some ofour mortgaged properties**Equity real estate investments are relatively illiquid, and this characteristic tends to limit ourability to vary our portfolio promptly in response to changes in economic or other conditions. Inaddition, significant expenditures associated with each equity investment, such as mortgagepayments, real estate taxes and maintenance costs, are generally not reduced when circumstancescause a reduction in income from the investment. If income from a property declines while therelated expenses do not decline, our income and cash available for distribution to our stockholderswould be adversely affected. A significant portion of our properties are mortgaged to securepayment of indebtedness, and if we were unable to meet our mortgage payments, we could lose moneyas a result of foreclosure on the properties by the various mortgagees. In addition, if it becomesnecessary or desirable for us to dispose of one or more of the mortgaged properties, we might notbe able to obtain a release of the lien on the mortgaged property without payment of the associateddebt. The foreclosure of a mortgage on a property or inability to sell a property could adverselyaffect the level of cash available for distribution to our stockholders. If persons sellingproperties to us wish to defer the payment of taxes on the sales proceeds, we are likely to paythem in units of limited partnership interest in the Operating Partnership. In transactions of thiskind, we may also agree, subject to certain exceptions, not to sell the acquired properties forsignificant periods of time.**RISKS RELATED TO OUR BUSINESS****We may develop or expand new properties, and this activity is subject to various risks**We intend to continue to pursue development and expansion activities as opportunities arise. Inconnection with any development or expansion, we will be subject to various risks, including thefollowing:**•** we may abandon development or expansion activities;**•** construction costs of a project may exceed original estimates oravailable financing, possibly making the project unfeasible orunprofitable;**•** we may not be able to obtain financing or to refinanceconstruction loans, which generally have full recourse to us;**•** we may not be able to obtain zoning, occupancy or other requiredgovernmental permits and authorizations;**•** occupancy rates and rents at a completed project may not meetprojections and, therefore, the project may not be profitable; and**•** we may need Anchor, mortgage lender and property partnerapprovals, if applicable, for expansion or redevelopmentactivities.If a development project is unsuccessful, our loss could exceed our investment in the project.
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**If we are unable to manage our growth effectively, our financial condition and results ofoperations may be adversely affected**We have experienced rapid growth in recent years, increasing our total consolidated assets fromapproximately $1.8 billion at December 31, 1996 to approximately $25.4 billion at June 30, 2005.We may continue this rapid growth for the foreseeable future by acquiring or developing propertieswhen we believe that market circumstances and investment opportunities are attractive. We may not,however, be able to manage our growth effectively or to maintain a similar rate of growth in thefuture, and the failure to do so may have a material adverse effect on our financial condition andresults of operations.**We may incur costs to comply with environmental laws**Under various federal, state or local laws, ordinances and regulations, a current or previous owneror operator of real estate may be required to investigate and clean up hazardous or toxicsubstances released at a property, and may be held liable to a governmental entity or to thirdparties for property damage or personal injuries and for investigation and clean-up costs incurredby the parties in connection with the contamination. These laws often impose liability withoutregard to whether the owner or operator knew of, or was responsible for, the release of thehazardous or toxic substances. The presence of contamination or the failure to remediatecontamination may adversely affect the owner’s ability to sell or lease real estate or to borrowusing the real estate as collateral. Other federal, state and local laws, ordinances andregulations require abatement or removal of asbestos-containing materials in the event ofdemolition or some renovations or remodeling and also govern emissions of and exposure to asbestosfibers in the air. Federal and state laws also regulate the operation and removal of undergroundstorage tanks. In connection with the ownership, operation and management of our properties, wecould be held liable for the costs of remedial action with respect to these regulated substances ortanks or related claims.Each of our properties has been subjected to varying degrees of environmental assessment at varioustimes. However, the identification of new areas of contamination, a change in the extent or knownscope of contamination or changes in cleanup requirements could result in significant costs to us.**We are in a competitive business**There are numerous shopping facilities that compete with our properties in attracting retailers tolease space. In addition, retailers at our properties face continued competition from discountshopping centers, lifestyle centers, outlet malls, wholesale and discount shopping clubs, directmail, telemarketing, television shopping networks and shopping via the Internet. Competition ofthis type could adversely affect our revenues and cash available for distribution to ourstockholders.We compete with other major real estate investors with significant capital for attractiveinvestment opportunities. These competitors include other REITs, investment banking firms andprivate institutional investors. This competition has increased prices for commercial propertiesand may impair our ability to make suitable property acquisitions on favorable terms in the future.**We may not be able to obtain capital to make investments**We depend primarily on external financing to fund the growth of our business. This is because oneof the requirements of the Internal Revenue Code of 1986, as amended, which we refer to as the“Code,” for a REIT generally is that it distributes 90% of its net taxable income, excluding netcapital gains, to its stockholders. Our access to debt or equity financing depends on banks’willingness to lend to us and on conditions in the capital markets in general. We and othercompanies in the real estate industry have experienced less favorable terms for bank loans andcapital markets financing from time to time. Although we believe, based on current marketconditions, that we will be able to finance investments we
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wish to make in the foreseeable future, financing might not be available on acceptable terms or maybe affected by the amount of debt we have outstanding as a result of the TRC Merger.**Some of our potential losses may not be covered by insurance**We carry comprehensive liability, fire, flood, earthquake, terrorism, extended coverage and rentalloss insurance on all of our properties. We believe the policy specifications and insured limits ofthese policies are adequate and appropriate. There are, however, some types of losses, includinglease and other contract claims, that generally are not insured. If an uninsured loss or a loss inexcess of insured limits occurs, we could lose all or a portion of the capital we have invested ina property, as well as the anticipated future revenue from the property. If this happens, we mightnevertheless remain obligated for any mortgage debt or other financial obligations related to theproperty.If the Terrorism Risk Insurance Act is not extended beyond 2005, we may incur higher insurancecosts and greater difficulty in obtaining insurance which covers terrorist-related damages. Ourtenants may also experience similar difficulties.**We are subject to risks that affect the general retail environment**Our concentration in the regional mall market means that we are subject to factors that affect theretail environment generally, including the level of consumer spending, the willingness ofretailers to lease space in our shopping centers, department store consolidations and tenantbankruptcies. In addition, we are exposed to the risk that terrorist activities, or the threat ofsuch activities, may discourage consumers from visiting our malls and impact consumer confidence.**Inflation may adversely affect our financial condition and results of operations**Should inflation increase in the future, we may experience any or all of the following:**•** decreasing tenant sales as a result of decreased consumer spendingwhich could result in lower percentage rents;**•** difficulty in replacing or renewing expiring leases with newleases at higher base and/or percentage rents; and**•** an inability to receive reimbursement from our tenants for theirshare of certain operating expenses, including common areamaintenance, real estate taxes and insurance.Inflation also poses a potential threat to us due to the probability of future increases ininterest rates. Such increases would adversely impact us due to our outstanding variable-rate debtas well as result in higher interest rates on new fixed-rate debt.**RISKS RELATED TO OUR ORGANIZATIONAL AND FINANCIAL STRUCTURE THAT GIVE RISE TO OPERATIONAL ANDFINANCIAL RISKS****Our substantial indebtedness could adversely affect our financial health and operating flexibility**We have a substantial amount of indebtedness. As of June 30, 2005, we had an aggregateconsolidated indebtedness outstanding of approximately$20.5 billion, approximately $13.3 billionof which was secured by our properties. A majority of the secured indebtedness was non-recourse tous, while approximately $7.2 billion of our aggregate indebtedness was unsecured, recourseindebtedness of the Operating Partnership and consolidated subsidiaries. This indebtedness doesnot include our proportionate share of indebtedness incurred by our joint ventures. As a result ofthis substantial indebtedness, we are required to use a material portion of our cash flow toservice principal and interest on our debt, which will limit the cash flow available for otherdesirable business opportunities.
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Our substantial indebtedness could have important consequences to us and the value of our commonstock including:**•** limiting our ability to borrow additional amounts for working capital, capitalexpenditures, debt service requirements, execution of our growth strategy or otherpurposes;**•** limiting our ability to use operating cash flow in other areas of our business becausewe must dedicate a substantial portion of these funds to service the debt;**•** increasing our vulnerability to general adverse economic and industry conditions;**•** limiting our ability to capitalize on business opportunities, including the acquisitionof additional properties, and to react to competitive pressures and adverse changes ingovernment regulation;**•** limiting our ability or increasing the costs to refinance indebtedness; and**•** limiting our ability to enter into marketing and hedging transactions by reducing thenumber of counterparties with whom we can enter into such transactions as well as thevolume of those transactions.**The terms of the 2004 Credit Facility obtained in conjunction with the TRC Merger contain covenantsand events of default that may limit our flexibility and prevent us from taking certain actions orresult in the acceleration of our obligations under the facility**The terms of the 2004 Credit Facility require us to satisfy certain customary affirmative andnegative covenants and to meet financial ratios and tests including ratios and tests based onleverage, interest coverage and net worth. The covenants under our 2004 Credit Facility affect,among other things, our ability to:**•** incur indebtedness;**•** create liens on assets;**•** sell assets;**•** make capital expenditures; and**•** engage in mergers and acquisitions.Given the restrictions in our debt covenants on these and other activities, we may be restricted inour ability to pursue other acquisitions, may be significantly limited in our operating andfinancial flexibility and may be limited in our ability to respond to changes in our business orcompetitive activities.A failure to comply with these covenants, including a failure to meet the financial tests orratios, would likely result in an event of default under the 2004 Credit Facility and would allowthe lenders to accelerate our debt under such facility. If our debt is accelerated, our assets maynot be sufficient to repay such debt in full.**We share control of some of our properties with other investors and may have conflicts of interestwith those investors**As ofJune 30, 2005, we had partial interests in retail and commercial properties (referred to in thisQuarterly Report as the “Unconsolidated Properties.” We generally make all operating decisions forthese properties, but we are required to make other decisions with the other investors who haveinterests in the relevant property or properties. For example, the approval of certain of the otherinvestors is required with respect to operating budgets and refinancing, encumbering, expanding orselling any of these properties. We might not have the same interests as the other investors inrelation to these transactions. Accordingly, we might not be able to favorably resolve any of theseissues, or we might have to provide financial or other inducement to the other investors to obtaina favorable resolution.
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In addition, various restrictive provisions and rights apply to sales or transfers of interests inour jointly owned properties. These may work to our disadvantage because, among other things, wemight be required to make decisions about buying or selling interests in a property or propertiesat a time that is disadvantageous to us or we might be required to purchase the interests of ourpartners in our jointly owned properties.**Bankruptcy of joint venture partners could impose delays and costs on us with respect to thejointly owned retail properties**The bankruptcy of one of the other investors in any of our jointly owned shopping centers couldmaterially and adversely affect the relevant property or properties. Under the bankruptcy laws, wewould be precluded by the automatic stay from taking some actions affecting the estate of the otherinvestor without prior approval of the bankruptcy court, which would, in most cases, entail priornotice to other parties and a hearing in the bankruptcy court. At a minimum, the requirement toobtain court approval may delay the actions we would or might want to take. If the relevant jointventure through which we have invested in a property has incurred recourse obligations, thedischarge in bankruptcy of one of the other investors might result in our ultimate liability for agreater portion of those obligations than we would otherwise bear.**Payments by our direct and indirect subsidiaries of dividends and distributions to us may beadversely affected by prior payments to these subsidiaries’ creditors and preferred securityholders**Substantially all of our assets are owned through our general partnership interest in the OperatingPartnership, including TRCLP. The Operating Partnership holds substantially all of its propertiesand assets through subsidiaries, including subsidiary partnerships, limited liability companies andcorporations that have elected to be taxed as REITs. The Operating Partnership therefore derivessubstantially all of its cash flow from cash distributions to it by its subsidiaries, and we, inturn, derive substantially all of our cash flow from cash distributions to us by the OperatingPartnership. The creditors and preferred security holders, if any, of each of our direct andindirect subsidiaries are entitled to payment of that subsidiary’s obligations to them, when dueand payable, before that subsidiary may make distributions to us. Thus, the Operating Partnership’sability to make distributions to its partners, including us, depends on its subsidiaries’ abilityfirst to satisfy their obligations to their creditors and preferred security holders, if any, andthen to make distributions to the Operating Partnership. Similarly, our ability to pay dividends toholders of our common stock depends on the Operating Partnership’s ability first to satisfy itsobligations to its creditors and preferred security holders**,**if any, and then to make distributionsto us.In addition, we will have the right to participate in any distribution of the assets of any of ourdirect or indirect subsidiaries upon the liquidation, reorganization or insolvency of thesubsidiary only after the claims of the creditors, including trade creditors, and preferredsecurity holders, if any, of the subsidiary are satisfied. Our common stockholders, in turn, willhave the right to participate in any distribution of our assets upon the liquidation,reorganization or insolvency of us only after the claims of our creditors, including tradecreditors, and preferred security holders, if any, are satisfied.**We might fail to qualify or remain qualified as a REIT**Although we believe that we will remain structured and will continue to operate so as to qualify asa REIT for federal income tax purposes, we might not continue to be so qualified. Qualification asa REIT for federal income tax purposes involves the application of highly technical and complexprovisions of the Code for which there are only limited judicial or administrative interpretations.Therefore, the determination of various factual matters and circumstances not entirely within ourcontrol may impact our ability to qualify as a REIT. In addition, legislation, new regulations,administrative interpretations or
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court decisions might significantly change the tax laws with respect to the requirements forqualification as a REIT or the federal income tax consequences of qualification as a REIT.If, with respect to any taxable year, we fail to maintain our qualification as a REIT, we would notbe allowed to deduct distributions to stockholders in computing our taxable income and federalincome tax. The corporate level income tax, including any applicable alternative minimum tax, wouldapply to our taxable income at regular corporate rates. As a result, the amount available fordistribution to stockholders would be reduced for the year or years involved, and we would nolonger be required to make distributions. In addition, unless we were entitled to relief under therelevant statutory provisions, we would be disqualified from treatment as a REIT for the taxableyears following the year during which qualification was lost. Notwithstanding that we currentlyintend to operate in a manner designed to allow us to qualify as a REIT, future economic, market,legal, tax or other considerations may cause us to determine that it is in our best interest andthe best interest of our stockholders to revoke the REIT election.**An ownership limit and certain anti-takeover defenses and applicable law may hinder any attempt toacquire us****The Ownership Limit**. Generally, for us to maintain our qualification as a REIT under the Code,not more than 50% in value of the outstanding shares of our capital stock may be owned, directly orindirectly, by five or fewer individuals at any time during the last half of our taxable year. TheCode defines “individuals” for purposes of the requirement described in the preceding sentence toinclude some types of entities. In general, under our Second Amended and Restated Certificate ofIncorporation, as amended (our “Certificate”), no person other than Martin Bucksbaum (deceased),Matthew Bucksbaum (the Chairman of our Board of Directors), their families and related trusts andentities, including M.B. Capital Partners III, may own more than 7.5% of the value of ouroutstanding capital stock. However, our Certificate also permits our company to exempt a personfrom the 7.5% ownership limit upon the satisfaction of certain conditions which are described inour Certificate.**Selected Provisions of our Charter Documents.**Our board of directors is divided into threeclasses of directors. Directors of each class are chosen for three-year staggered terms. Staggeredterms of directors may reduce the possibility of a tender offer or an attempt to change control ofour company, even though a tender offer or change in control might be in the best interest of ourstockholders. Our charter authorizes the board of directors:**•** to cause us to issue additional authorized but unissued shares of common stock or preferred stock;**•** to classify or reclassify, in one or more series, any unissued preferred stock; and**•** to set the preferences, rights and other terms of any classified or reclassified stock that we issue.**Stockholder Rights Plan.**We have a stockholder rights plan which will impact a potentialacquirer unless the acquirer negotiates with our board of directors and the board of directorsapproves the transaction.**Selected Provisions of Delaware Law.**We are a Delaware corporation, and Section 203 of theDelaware General Corporation Law applies to us. In general, Section 203 prevents an “interestedstockholder,” as defined in the next sentence, from engaging in a “business combination,” asdefined in
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the statute, with us for three years following the date that person becomes an interestedstockholder unless:**•** before that person became an interested stockholder, our board ofdirectors approved the transaction in which the interestedstockholder became an interested stockholder or approved thebusiness combination;**•** upon completion of the transaction that resulted in the interestedstockholder becoming an interested stockholder, the interestedstockholder owned at least 85% of our voting stock outstanding atthe time the transaction commenced, excluding for purposes ofdetermining the voting stock outstanding (but not the outstandingvoting stock owned by the interested stockholder) stock held bydirectors who are also officers of the company and by employeestock plans that do not provide employees with the right todetermine confidentially whether shares held under the plan willbe tendered in a tender or exchange offer; or**•** following the transaction in which that person became aninterested stockholder, the business combination is approved byour board of directors and authorized at a meeting of stockholdersby the affirmative vote of the holders of at least two-thirds ofour outstanding voting stock not owned by the interestedstockholder.The statute defines “interested stockholder” to mean generally any person that is the owner of 15%or more of our outstanding voting stock or is an affiliate or associate of us and was the owner of15% or more of our outstanding voting stock at any time within the three-year period immediatelybefore the date of determination.Each item discussed above may delay, deter or prevent a change incontrol of our company, even if a proposed transaction is at a premium over the then current marketprice for our common stock. Further, these provisions may apply in instances where somestockholders consider a transaction beneficial to them. As a result, our stock price may benegatively affected by these provisions.**We have partners who have tax protection arrangements and other tax-related obligations to certainpartners**We own properties through partnerships which have arrangements in place that protect the deferredtax situation of our existing third party limited partners. Violation of these arrangements couldimpose costs on us. As a result, we may be restricted with respect to decisions such as financing,encumbering, expanding or selling these properties.Several of our joint venture partners are tax-exempt. As such, they are taxable to the extent oftheir share of unrelated business taxable income generated from these properties. As the managingpartner in these joint ventures, we have obligations to avoid the creation of unrelated businesstaxable income at these properties. As a result, we may be restricted with respect to decisionssuch as financing and revenue generation with respect to these properties.**RISKS RELATED TO THE TRC MERGER****We may be unable to integrate the operations of TRCLP successfully and may not realize the fullanticipated benefits of the TRC Merger**Achieving the anticipated benefits of the TRC Merger will depend in part upon our ability tointegrate the two companies’ businesses in an efficient and effective manner. Our attempt tointegrate two companies that have previously operated independently may result in significantchallenges, and we may be unable to accomplish the integration smoothly or successfully. Inparticular, the necessity of coordinating geographically dispersed organizations and addressingpossible differences in corporate cultures and management philosophies may increase thedifficulties of integration. The integration will continue to require the dedication of significantmanagement resources, which may temporarily distract management’s attention from the day-to-dayoperations of the businesses of the combined company. The
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process of integrating operations may cause further interruption of, or loss of momentum in, theactivities of one or more of the combined company’s businesses and the further loss of keypersonnel. In, addition, we may face difficulties integrating aspects of the combined company’sbusinesses that we have not historically focused on, such as the community development business.Any inability of management to integrate the operations of TRCLP successfully could cause us to notfully achieve the expected benefits of the TRC Merger.**Limitations on the sale of the TRCLP assets may affect our cash flow**We may be restricted in our ability to dispose of certain TRCLP assets until the ten-year periodafter TRC’s election of REIT status expires in 2008 due to the potential incurrence of substantialtax liabilities on such dispositions due to applicable REIT regulations.**Representatives of the holders of interests of a Contingent Stock Agreement (the “CSA”) haveasserted that the TRC Merger is a prohibited transaction**We have assumed the obligations of TRC under the CSA. The assumption includes the obligation underthe CSA to issue shares of common stock twice a year to the beneficiaries under the CSA. Thenumber of shares is based upon our stock price and upon a formula set forth in the CSA. Suchissuances could be dilutive to our existing stockholders if we are unable to repurchase acorresponding number of shares through our publicly announced stock repurchase program.Notwithstanding our assumption of the CSA, there is an on-going dispute with the beneficiaries, whoare taking the position that the TRC Merger violates certain portions of the CSA in that the TRCMerger is a “prohibited transaction” because the TRC Merger, among other things, had a prejudicialeffect on the beneficiaries with respect to their non-taxable receipt of securities under the CSA.We have provided the beneficiaries with certain indemnification rights relating to this issue. Wealso believe that all applicable requirements of the CSA have been satisfied in connection with theTRC Merger and, therefore, the TRC Merger does not constitute a “prohibited transaction.” However,we might not be able to favorably resolve these issues.**RISKS RELATED TO OUR COMMON STOCK****Our common stock price may be volatile, and consequently investors may not be able to resell theircommon stock at or above their purchase price**The price at which our common stock will trade may be volatile and may fluctuate due to factorssuch as:**•** our historical and anticipated quarterly and annual operating results;**•** variations between our actual results and analyst and investor expectations or changes in financial estimates andrecommendations by securities analysts;**•** the performance and prospects of our industry;**•** the depth and liquidity of the market for our common stock;**•** investor perception of us and the industry in which we operate;**•** domestic and international economic conditions;**•** the extent of institutional investor interest in us;**•** the reputation of REITs generally and the attractiveness of their equity securities in comparison to other equitysecurities, including securities issued by other real estate companies, and fixed income securities;**•** our financial condition and performance; and**•** general market conditions and trends.Fluctuations may be unrelated to or disproportionate to our financial performance. Thesefluctuations may result in a material decline in the trading price of our common stock.
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**Future sales of our common stock may depress our stock price**As of June 30, 2005, approximately 62.8 million shares of common stock were reserved for issuanceupon exercise of conversion and/or redemption rights as to units of limited partnership interest inthe operating partnership. Under our shelf registration statement, we may offer from time to timeup to $2 billion worth of common stock, preferred stock, depositary shares, debt securities,warrants, stock purchase contracts and/or purchase units.Approximately $500 million was drawnagainst this shelf in connection with our November 2004 warrants offering. An additional 3.5million shares of our common stock remain reserved for issuance under the CSA we assumed inconnection with the TRC Merger. In addition, we have reserved a number of shares of common stockfor issuance under our option and other benefit plans for employees and directors and in connectionwith certain other obligations, and these shares will be available for sale from time to time.Although we have publicly announced a stock repurchase program designed to offset the dilutionresulting from issuances pursuant to the CSA and our employee option plan, there is no certaintythat we will be successful in acquiring a sufficient number of shares at an acceptable price toaccomplish this goal. No prediction can be made as to the effect, if any, that these and otherfuture sales of our common stock, or the availability of common stock for future sales, will haveon the market price of the stock. Sales in the public market of substantial amounts of our commonstock, or the perception that such sales could occur, could adversely affect prevailing marketprices for our common stock.**Increases in market interest rates may hurt the market price of our common stock**We believe that investors consider the distribution rate on REIT stocks, expressed as a percentageof the price of the stocks, relative to market interest rates as an important factor in decidingwhether to buy or sell the stocks. If market interest rates go up, prospective purchasers of REITstocks may expect a higher distribution rate. Higher interest rates would not, however, result inmore funds being available for us to distribute and, in fact, would likely increase our borrowingcosts and might decrease our funds available for distribution. Thus, higher market interest ratescould cause the market price of our common stock to decline.
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