EXCEL LEGACY CORPORATION
Series A Liquidating Preference Convertible
Preferred Stock due 2005
PURCHASE AGREEMENT
Dated as of March 31, 1998
TABLE OF CONTENTS
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SECTION 1. PURCHASE AND SALE OF SECURITIES. . . . . . . . . . . . . . . . . 1
1.1 Issue of Securities. . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Sale and Purchase of the Securities; the Closing . . . . . . . . . . 2
1.3 Purchaser's Representations; Source of Funds . . . . . . . . . . . . 3
1.4 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.5 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.6 Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.7 Further Action . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.8 Affirmative Covenants. . . . . . . . . . . . . . . . . . . . . . . . 6
1.9 Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 2. CLOSING CONDITIONS . . . . . . . . . . . . . . . . . . . . . . . 8
2.1 Opinions of Counsel. . . . . . . . . . . . . . . . . . . . . . . . . 8
2.2 Representations and Warranties True. . . . . . . . . . . . . . . . . 8
2.3 Compliance with this Agreement . . . . . . . . . . . . . . . . . . . 8
2.4 Officers' Certificates . . . . . . . . . . . . . . . . . . . . . . . 8
2.5 Your Purchase Permitted by Applicable Laws; Legal Investment . . . . 8
2.6 The Certificate of Designation . . . . . . . . . . . . . . . . . . . 9
2.7 The Registration Rights Agreement. . . . . . . . . . . . . . . . . . 9
2.8 Subsequent Agreements. . . . . . . . . . . . . . . . . . . . . . . . 9
2.9 Completion of Other Transactions . . . . . . . . . . . . . . . . . . 9
2.10 Consents and Permits . . . . . . . . . . . . . . . . . . . . . . . . 9
2.11 Private Placement Number . . . . . . . . . . . . . . . . . . . . . . 9
2.12 Changes in Corporate Structure . . . . . . . . . . . . . . . . . . . 10
2.13 Proceedings and Documents. . . . . . . . . . . . . . . . . . . . . . 10
SECTION 3. PURCHASER'S SPECIAL RIGHTS . . . . . . . . . . . . . . . . . . . 10
3.1 Delivery Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.2 Issue Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.3 Direct Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.4 Lost, etc. Securities. . . . . . . . . . . . . . . . . . . . . . . . 11
3.5 Delivery of Financial Statements and Reports . . . . . . . . . . . . 11
SECTION 4. COMPANY'S REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . 11
4.1 Organization, Standing and Qualification . . . . . . . . . . . . . . 11
4.2 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.3 Authorization of Agreement and Other Documents . . . . . . . . . . . 13
4.4 No Violation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.5 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.6 Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.7 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . 14
4.8 Full Disclosure. . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.9 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.10 Title to and Condition of Properties . . . . . . . . . . . . . . . . 15
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4.11 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.12 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.13 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . 16
4.14 Governmental Consents. . . . . . . . . . . . . . . . . . . . . . . . 16
4.15 No Violation of Regulations of Board of Governors of
Federal Reserve System . . . . . . . . . . . . . . . . . . . . . . . 16
4.16 Private Offering . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.17 Labor Relations. . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.18 Governmental Regulations . . . . . . . . . . . . . . . . . . . . . . 17
4.19 Environmental Matters. . . . . . . . . . . . . . . . . . . . . . . . 17
4.20 Brokers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.21 Foreign Assets Control Regulations, etc. . . . . . . . . . . . . . . 18
4.22 Restrictions on Dividends. . . . . . . . . . . . . . . . . . . . . . 18
4.23 Survival of Representations and Warranties . . . . . . . . . . . . . 18
SECTION 5. DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 6. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.1 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.2 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . 21
6.3 Amendment and Waiver . . . . . . . . . . . . . . . . . . . . . . . . 21
6.4 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.5 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.6 GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.7 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . 22
6.8 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
6.9 Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
6.10 Public Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . 22
ANNEX A CERTIFICATE OF DESIGNATION
ANNEX B REGISTRATION RIGHTS AGREEMENT
ANNEX C OPINION OF COUNSEL TO THE COMPANY
ANNEX D OPINION OF SPECIAL COUNSEL TO THE PURCHASERS
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Excel Legacy Corporation
16955 Xxx Xxx Xxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
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PURCHASE AGREEMENT
Series A Liquidating Preference Convertible
Preferred Stock due 2005
March 31, 1998
To Each of the Purchasers
Named on the Signature
Pages Hereof
Dear Sirs:
Excel Legacy Corporation, a Delaware corporation (the "Company"),
hereby agrees with you as follows:
SECTION 1. PURCHASE AND SALE OF SECURITIES
1.1 ISSUE OF SECURITIES
On or before the Closing (as hereinafter defined), the Company will
have authorized the issue of 16,784,000 shares of Series A Liquidating
Preference Convertible Preferred Stock due 2005, $.01 par value (the
"Securities"), having the rights, designations and preferences set forth in a
certificate of designation in substantially the form attached hereto as Annex A
(herein, together with all amendments and modifications thereto from time to
time, called the "Certificate of Designation"). Capitalized terms used herein
without definition shall have the meanings specified in Section 5 hereof.
The Securities will be offered and sold to you pursuant to an
exemption from the registration requirements under the Securities Act of 1933,
as amended (the "Securities Act"). Upon original issuance thereof, and until
such time as the holder thereof delivers a legal opinion (which may be that of
internal counsel for the holder) satisfactory in form and substance to the
Company and its counsel that the same is no longer required under the applicable
requirements of the Securities Act, the Securities (and all securities issued in
substitution thereof or upon conversion thereof) shall bear the following
legend:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER XXXXXXX 0 XX
XXX XXXXXX XXXXXX SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND
THE SECURITY EVIDENCED HEREBY AND ANY SHARES OF COMMON STOCK ISSUED
UPON CONVERSION HEREOF MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF
THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY
BE RELYING ON THE EXEMPTION PROVIDED BY RULE 144A THEREUNDER. THE
HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) SUCH SECURITY AND ANY SHARES OF COMMON STOCK ISSUED
UPON CONVERSION HEREOF MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED, ONLY (1) (A) INSIDE THE UNITED STATES TO A PERSON WHO THE
SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, OR IN ACCORDANCE WITH RULE 144
UNDER THE SECURITIES ACT, OR PURSUANT TO ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN
OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (B) TO THE COMPANY,
(C) OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT OR (D)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT AND (2) IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER OF THE SECURITY EVIDENCED HEREBY OR
ANY COMMON STOCK ISSUED UPON CONVERSION HEREOF OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE."
You will have the registration rights with respect to the Securities
set forth in the Registration Rights Agreement in substantially the form
attached hereto as Annex B (the "Registration Rights Agreement").
1.2 SALE AND PURCHASE OF THE SECURITIES; THE CLOSING
In reliance upon your representations made in Section 1.3 hereof and
subject to the terms and conditions set forth herein and in the other Documents,
the Company hereby agrees to sell to you the Securities set forth on the
signature pages hereof, for the purchase price(s) set forth thereon. In
reliance upon the representations and warranties of the Company contained herein
and in the other Documents, and subject to the terms and conditions set forth
herein and therein, you hereby agree to purchase such Securities from the
Company.
The Company is executing other purchase agreements (the "Other
Purchase Agreements") substantially identical to this Agreement with the other
purchasers (the "Other Purchasers") named on the signature pages thereof,
pursuant to which the Company will issue and sell Securities to such Other
Purchasers in the respective amounts set forth on the signature pages thereof.
The Other Purchasers may include the Placement Agent or persons who may be
deemed affiliated or associated with the Placement Agent; neither the Placement
Agent nor any such person, however, has any obligation or commitment to purchase
any of the Securities. The sales of Securities to you and the Other Purchasers
are to be separate sales, and this Agreement and the Other Purchase Agreements
are to be separate agreements,
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but references to this "Agreement" shall include the Other Purchase Agreements
where the context so permits, together with all modifications hereof and
thereof.
The sale and purchase of the Securities shall take place at a closing
(the "Closing") at the offices of Xxxxxx & Xxxxxxx, 000 "X" Xxxxxx, Xxxxx 0000,
Xxx Xxxxx, Xxxxxxxxxx 00000, on the earliest practicable date as of which all of
the conditions set forth in Section 2 hereof have been satisfied or duly waived
(the "Closing Date"), but in no event later than April 15, 1998. At the
Closing, one or more Securities in definitive form, registered in the name of
Cede & Co., as nominee of the Depository Trust Company ("DTC"), shall be
delivered by the Company to you and the Other Purchasers, against payment by you
and the Other Purchasers of the purchase price therefor by wire transfer of
immediately available funds. The Securities in definitive form shall be made
available to you for inspection not later than 9:30 a.m. on the business day
immediately preceding the Closing Date.
1.3 PURCHASER'S REPRESENTATIONS; SOURCE OF FUNDS
(a) You represent that you are purchasing the Securities to be
purchased by you solely for your own account and not as nominee or agent for any
other person and not with a view to, or for offer or sale in connection with,
any distribution thereof (within the meaning of the Securities Act) that would
be in violation of the securities laws of the United States of America or any
state thereof, without prejudice, however, to your right at all times to sell or
otherwise dispose of all or any part of said Securities under a registration
under the Securities Act or under an exemption from such registration available
under such Act.
You further represent that you are knowledgeable, sophisticated and
experienced in business and financial matters; that you have previously invested
in securities similar to the Securities and fully understand the limitations on
transfer described in Section 1.3(b) hereof; that you are able to bear the
economic risk of your investment in the Securities and are presently able to
afford the complete loss of such investment; and that you have been afforded
access to information about the Company and the Company's financial condition,
results of operations, business, property, management and prospects sufficient
to enable you to evaluate your investment in the Securities.
You further represent that you are a "qualified institutional buyer,"
as defined in Rule 144A under the Securities Act ("QIB"), with such knowledge
and experience in financial matters as are necessary in order to evaluate the
merits and risks of an investment in the Securities.
You acknowledge receipt of the Private Placement Memorandum and
further acknowledge that you have been afforded the opportunity (i) to ask such
questions as you have deemed necessary of, and to receive answers from,
representatives of the Company concerning the terms and conditions of the
offering of the Securities and the merits and risks of investing in the
Securities and (ii) to obtain such additional information which the Company
possesses or can acquire without unreasonable effort or expense that is
necessary to verify the accuracy and completeness of the information contained
in the Private Placement Memorandum.
You also understand that the Company, the Placement Agent, and, for
purposes of the opinion to be delivered to the Purchasers pursuant to Section
2.1 hereof, Xxxxxx & Xxxxxxx, will rely upon the accuracy and truth of the
foregoing representations and you hereby consent to such reliance.
(b) If you desire to sell or otherwise dispose of all or any part of
the Securities (other than pursuant to an effective registration statement under
the Securities Act or a sale or other disposition
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made pursuant to Rule 144), if requested by the Company, you will deliver to the
Company an opinion of counsel (which may include internal counsel), reasonably
satisfactory in form and substance to the Company, that an exemption from
registration under the Securities Act is available.
(c) You represent, if you are an insurance company, that no part of
the funds to be used to purchase the Securities to be purchased by you
constitutes assets allocated to any separate account maintained by you such that
the use of such funds constitutes a transaction in violation of Section 406 of
ERISA or a prohibited transaction, as such term is defined in Section 4975 of
the Code, which could be subject to, respectively, a civil penalty assessed
pursuant to Section 502 of ERISA or a tax imposed by Section 4975 of the Code.
If you are not an insurance company, you represent that no part of the funds to
be used to purchase the Securities to be purchased by you constitutes assets
allocated to any trust which contains the assets of any employee pension benefit
plan listed on Schedule 1.3(c) with respect to which the Company or any
corporation considered an affiliate of the Company within the meaning of Section
407(d)(7) of ERISA (an "Affiliate") is a party in interest or disqualified
person.
The representation made by you in one of the preceding two sentences
is made in reliance upon your review of the list set forth on Schedule 1.3(c) of
the employee pension benefit plans with respect to which the Company or any
corporation considered an Affiliate of the Company is a party in interest or a
disqualified person.
As used in this Section 1.3(c), the terms "employee pension benefit
plan," "separate account" and "party in interest" shall have the meanings
assigned to such terms in Section 3 of ERISA and the terms "disqualified person"
and "prohibited transaction" shall have the meanings assigned to such terms in
Section 4975 of the Code.
You represent that you are not a "Creditor" as such term is defined in
Regulation T of the Board of Governors of the Federal Reserve System.
1.4 EXPENSES
Whether or not the Securities are sold, the Company will pay or
reimburse all expenses relating to this Agreement, including but not limited to:
(a) the cost of printing and reproducing this Agreement, the
Securities, the other Documents and any other documents contemplated hereby or
thereby;
(b) the fees and other charges of Xxxxxx & Xxxxxxx, counsel to the
Company, in connection herewith;
(c) the fees and other charges of Xxxxx & Wood LLP, special counsel
to the Purchasers, in connection herewith;
(d) all fees and expenses (including the fees and expenses of
counsel) in connection with any registration or qualification of the Securities
for offer and sale under the securities or "blue sky" laws of any jurisdictions
requiring such registration or qualification or in connection with obtaining any
exemptions from such requirements;
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(e) all expenses and listing fees in connection with the application
for quotation of the Securities in the National Association of Securities
Dealers, Inc. Automated Quotation System - PORTAL ("PORTAL");
(f) all fees and expenses (including fees and expenses of counsel) of
the Company in connection with approval of the Securities by DTC for
"book-entry" transfer;
(g) all of your out-of-pocket expenses (including the fees and
expenses of counsel) relating to any amendment, or modification of, or any
waiver, or consent or preservation of rights under, or any work-out or
restructuring of the transactions contemplated by this Agreement and the other
Documents and any other documents contemplated hereby or thereby; and
(h) all other expenses, including counsel's fees, incurred by the
Company in connection with the transactions contemplated by this Agreement.
1.5 INDEMNIFICATION
In addition to any and all obligations of the Company to indemnify you
pursuant to the Registration Rights Agreement or any of the other Documents, the
Company shall, without limitation as to time, indemnify you and your Agents,
against, and hold you and them harmless from, all losses, claims, damages,
liabilities, costs (including the costs of preparation and attorneys' fees) and
expenses (collectively, "Losses") incurred by you or them pursuant to any
investigation or proceeding against any one or more of the Company, you or your
Agents, arising out of or in connection with this Agreement or the other
Documents (or any other document or instrument executed herewith or pursuant
hereto or thereto), whether or not the transactions contemplated by this
Agreement are consummated, which investigation or proceeding requires the
participation of, or is commenced or filed against, one or more of you and your
Agents because of this Agreement or the other Documents and the transactions
contemplated hereby or thereby, other than any Losses resulting from action on
the part of you or your Agents which is finally determined in such proceeding to
be wrongful and which (i) is unrelated to any wrongful act by the Company or its
representatives and (ii) was not taken by you or your Agents in reliance upon
any of the Company's warranties, covenants or promises herein or in the other
Documents or in any other documents contemplated hereby or thereby, including
certificates delivered by the Company pursuant hereto or thereto. The
obligations of the Company under this Section 1.5 shall survive the redemption
of the Securities, the conversion of the Securities, any transfer of the
Securities by you and the termination of this Agreement and the other Documents.
1.6 CONTRIBUTION
If the indemnification provided for in Section 1.5 from an
indemnifying party is unavailable to you or your Agents in respect of any Losses
referred to therein, then an indemnifying party, in lieu of indemnifying such
persons, shall contribute to the amount paid or payable by such persons as a
result of such Losses in such proportion as is appropriate to reflect the
relative fault of such indemnifying parties and you or your Agents in connection
with the actions which resulted in such Losses as well as any other relevant
equitable considerations. The amount paid or payable by a party as a result of
the Losses referred to above shall be deemed to include, subject to the
limitations set forth in Section 1.5, any legal or other fees or expenses
reasonably incurred by such party in connection with any investigation, lawsuit
or legal or administrative action or proceeding.
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The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 1.6 were determined by pro rata allocation
or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
1.7 FURTHER ACTION
During the period from the date hereof to the Closing Date, the
Company shall use all reasonable efforts and take all action reasonably
necessary or appropriate to cause its representations and warranties contained
in Section 4 hereof to be true as of the Closing Date, after giving effect to
the transactions contemplated by this Agreement, as if made on and as of such
date.
1.8 AFFIRMATIVE COVENANTS
The Company further covenants and agrees that so long as any of the
Securities are outstanding:
(a) INTEGRATION. The Company will not sell, offer for sale or
solicit offers to buy or otherwise negotiate in respect of any security (as
defined in the Securities Act) that would be integrated with the sale of the
Securities in a manner that would require the registration under the Securities
Act of the sale to you or the Other Purchasers of the Securities.
(b) INFORMATION. For so long as any of the Securities remain
outstanding and during any period in which the Company is not subject to Section
13 or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), the Company will make available to you and any Other Purchaser or
beneficial owner of Securities in connection with any sale thereof and any
prospective purchaser of such Securities, the information required by Rule
144A(d)(4) under the Securities Act.
(c) COMPLIANCE WITH AGREEMENTS. The Company will comply with its
agreements in the Registration Rights Agreement, and all agreements set forth in
the representation letters of the Company to DTC relating to the approval of the
Securities by DTC for "book-entry" transfer.
(d) PORTAL. The Company will use all reasonable efforts to effect
the inclusion of the Securities in PORTAL.
(e) COMPLIANCE WITH LAW. The Company will comply with all laws,
ordinances or governmental rules or regulations to which it is subject,
including, without limitation, Environmental Laws, and will obtain and maintain
in effect all licenses, certificates, permits, franchises and other governmental
authorizations necessary to the ownership of its properties or to the conduct of
its business to the extent necessary to ensure that non-compliance with such
laws, ordinances or governmental rules or regulations or failures to obtain or
maintain in effect such licenses, certificates, permits, franchises and other
governmental authorizations could not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the business or
financial condition of the Company.
(f) INSURANCE. The Company will maintain, with financially sound and
reputable insurers, insurance with respect to its properties and business
against such casualties and contingencies, of such types, on such terms and in
such amounts (including deductibles, coinsurance and self-insurance,
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if adequate reserves are maintained with respect thereto) as is customary in the
case of entities of established reputations engaged in the same or a similar
business and similarly situated.
(g) MAINTENANCE OF PROPERTIES. The Company will maintain and keep,
or cause to be maintained and kept, its properties in reasonably good repair,
working order and condition (other than ordinary wear and tear), so that the
business carried on in connection therewith may be properly conducted at all
times.
(h) PAYMENT OF TAXES AND CLAIMS. The Company will file all tax
returns required to be filed in any jurisdiction and to pay and discharge all
taxes shown to be due and payable on such returns and all other taxes,
assessments, governmental charges, or levies imposed on it or any of its
properties, assets, income or franchises, to the extent such taxes and
assessments have become due and payable and before they have become delinquent
and all claims for which sums have become due and payable that have or might
become a Lien on properties or assets of the Company; PROVIDED that the Company
need not pay any such tax or assessment or claim if (i) the amount,
applicability or validity thereof is contested by the Company on a timely basis
in good faith and in appropriate proceedings, and the Company has established
adequate reserves therefor in accordance with generally accepted accounting
principles on the books of the Company, or (ii) the nonpayment of all such taxes
and assessments in the aggregate could not reasonably be expected to have a
material adverse effect on the business or financial condition of the Company.
(i) CORPORATE EXISTENCE. The Company will at all times preserve and
keep in full force and effect its corporate existence.
1.9 NEGATIVE COVENANTS
The Company further covenants and agrees that so long as any of the
Securities are outstanding:
(a) TRANSACTIONS WITH AFFILIATES. The Company will not enter into
directly or indirectly any transaction or material group of related transactions
(including without limitation the purchase, lease, sale or exchange of
properties of any kind or the rendering of any service) with any Affiliate
except in the ordinary course and pursuant to the reasonable requirements of the
Company's business and upon fair and reasonable terms no less favorable to the
Company than would be obtainable in a comparable arm's-length transaction with a
Person not an Affiliate.
(b) NATURE OF BUSINESS. The Company will not undertake or invest in
any types of business other than those described in or contemplated by the
Private Placement Memorandum.
(c) MERGER, CONSOLIDATION, ETC. The Company will not consolidate
with or merge with any other corporation or convey, transfer or lease
substantially all of its assets in a single transaction or series of
transactions to any Person unless the successor formed by such consolidation or
the survivor of such merger or the Person that acquires by conveyance, transfer
or lease substantially all of the assets of the Company as an entirety, as the
case may be, shall be a solvent corporation organized and existing under the
laws of the United States or any State thereof (including the District of
Columbia), and, if the Company is not such corporation, (i) such corporation
shall have executed and delivered to each holder of any Securities its
assumption of the due and punctual performance and observance of each covenant
and condition of this Agreement and the other Documents, and (ii) shall have
caused to be delivered to each holder of any Securities an opinion of nationally
recognized independent counsel, or other
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independent counsel reasonably satisfactory to such holders, to the effect that
all agreements or instruments effecting such assumption are enforceable in
accordance with their terms and comply with the terms hereof.
SECTION 2. CLOSING CONDITIONS
Your obligation to purchase and pay for the Securities to be delivered
to you at the Closing shall be subject to the satisfaction of the following
conditions on or before the Closing Date:
2.1 OPINIONS OF COUNSEL
You shall have received the favorable opinions, dated the Closing Date
and addressed to you, from Xxxxxx & Xxxxxxx, counsel to the Company, and from
Xxxxx & Wood LLP, special counsel to the Purchasers, in substantially the forms
attached hereto as Annex C and Annex D, respectively.
In rendering the foregoing opinions, such counsel may rely as to
factual matters upon certificates or other documents furnished by officers and
directors of the Company (copies of which shall be delivered to you) and by
government officials, and upon such other documents as such counsel deem
appropriate as a basis for their opinions.
2.2 REPRESENTATIONS AND WARRANTIES TRUE
The Company's representations and warranties contained in Section 4
hereof shall be true at and as of the Closing Date, after giving effect to the
transactions contemplated by this Agreement, as if made on and as of such date.
2.3 COMPLIANCE WITH THIS AGREEMENT
The Company shall have performed and complied with all agreements,
covenants and conditions contained herein, in the other Documents and any other
document contemplated hereby or thereby which are required to be performed or
complied with by the Company on or before the Closing Date.
2.4 OFFICERS' CERTIFICATES
You shall have received (i) a certificate, dated the Closing Date and
signed by each of the Chief Executive Officer and the Chief Financial Officer of
the Company, certifying that the conditions set forth in Sections 2.2 and 2.3
hereof are satisfied on and as of such date and further certifying as to such
other matters as you may request in the exercise of your reasonable discretion,
and (ii) a certificate, dated the Closing Date and signed by the Secretary of
the Company, certifying as to the resolutions attached thereto and other
corporate proceedings relating to the authorization, execution and delivery of
the Securities and the Documents.
2.5 YOUR PURCHASE PERMITTED BY APPLICABLE LAWS; LEGAL INVESTMENT
Your purchase of and payment for the Securities to be purchased by you
(a) shall not be prohibited by any applicable law or governmental regulation
(including, without limitation, Regulations G, T, U and X of the Board of
Governors of the Federal Reserve System and without recourse to the so-called
"basket provisions" permitting certain limited investments by insurance
companies), (b) shall not
8
subject you to any penalty, liability or other onerous condition under or
pursuant to any applicable law or governmental regulation, and (c) shall be
permitted by the laws and regulations of the jurisdictions to which you are
subject.
2.6 THE CERTIFICATE OF DESIGNATION
The Certificate of Designation shall have been filed with the
Secretary of State of Delaware.
2.7 THE REGISTRATION RIGHTS AGREEMENT
The Company shall have entered into the Registration Rights Agreement
for your benefit and the benefit of the Other Purchasers, and you shall have
received an original, duly executed by the Company, and counterparts, conformed
as executed, of the Registration Rights Agreement.
2.8 SUBSEQUENT AGREEMENTS
The Company shall not have entered into any other agreements relating
to the sale of the Securities to any other party on terms differing from those
contained herein, unless the Company shall have offered such differing terms to
you.
2.9 COMPLETION OF OTHER TRANSACTIONS
Simultaneously with the sale to you of the Securities to be purchased
by you at the Closing, the Company shall have:
(a) Sold and received payment for the Securities to be purchased by
the Other Purchasers pursuant to the Other Purchase Agreements, which Other
Purchase Agreements shall be the same as this Agreement and which Securities
shall be substantially the same as the Securities being delivered to you; and
(b) Consummated the asset transfers to the Company and the
distribution of the Company's Common Stock to the stockholders of Excel Realty
Trust, Inc., substantially as described in or contemplated by the Private
Placement Memorandum.
2.10 CONSENTS AND PERMITS
The Company shall have received all consents, permits and other
authorizations, and made all such filings and declarations, as may be required
from any Person pursuant to any law, statute, regulation or rule (federal,
state, local and foreign), or pursuant to any agreement, order or decree to
which the Company is a party or to which it is subject, in connection with the
transactions contemplated by this Agreement.
2.11 PRIVATE PLACEMENT NUMBER
A Private Placement Number issued by Standard & Poor's CUSIP Service
Bureau (in cooperation with the Securities Valuation Office of the National
Association of Insurance Commissioners) shall have been obtained for the
Securities.
9
2.12 CHANGES IN CORPORATE STRUCTURE
Except as described in the Private Placement Memorandum, the Company
shall not have changed its jurisdiction of incorporation or been a party to any
merger or consolidation and shall not have succeeded to all or any substantial
part of the liabilities of any other entity, at any time following the date of
the financial statements referred to in Section 4.7 hereof.
2.13 PROCEEDINGS AND DOCUMENTS
All corporate and other proceedings in connection with the
transactions contemplated by this Agreement and all documents and instruments
incident to such transactions shall be reasonably satisfactory to you and your
special counsel, and you and your special counsel shall have received all such
counterpart originals or certified or other copies of such documents as you or
they may reasonably request.
SECTION 3. PURCHASER'S SPECIAL RIGHTS
The provisions of this Section 3 shall apply, notwithstanding anything
to the contrary in this Agreement, or the other Documents or any other document
contemplated hereby or thereby; provided that the provisions of this Section 3
shall apply with respect to Transfer Restricted Securities only; and further
provided that the Company's obligations set forth in this Section 3 that are
outstanding with respect to any Security at the time such Security ceases to be
a Transfer Restricted Security shall survive until such time as all such
obligations with respect to such Security shall have been satisfied in full.
3.1 DELIVERY EXPENSES
If you surrender any Security to the Company for any reason, the
Company will pay the cost of delivering to or from your office or to or from the
office of your designee from or to the Company, insured to your reasonable
satisfaction, the surrendered Security and each Security issued in substitution
or replacement for the surrendered Security, and any Common Stock issued on
conversion of all or any part of a surrendered Security.
3.2 ISSUE TAXES
The Company will pay all taxes in connection with the issuance, sale,
delivery or transfer by the Company to the Purchasers of the Securities and the
execution and delivery of the Documents and any other agreements and instruments
contemplated thereby and any modification of any of such Securities, Documents
or such other agreements and instruments and will save you harmless without
limitation as to time against any and all liabilities with respect to all such
taxes.
3.3 DIRECT PAYMENT
The Company will pay or cause to be paid all amounts payable with
respect to any Transfer Restricted Security by crediting by federal funds bank
wire transfer to the holder's account in any bank in the United States as may be
designated and specified in writing by such holder. Your initial bank account
for this purpose is on your signature page hereof.
10
3.4 LOST, ETC. SECURITIES
If any Transfer Restricted Security of which a Purchaser or any other
institutional holder (or nominee thereof) which is a transferee is the owner, is
mutilated, destroyed, lost or stolen, then the affidavit of such Purchaser's or
such holder's treasurer or assistant treasurer (or other responsible official),
setting forth the circumstances with respect to such mutilation, destruction,
loss or theft, shall be accepted as satisfactory evidence thereof, and no
indemnity, security or payment of charges or expenses shall be required as a
condition to the execution and delivery by the Company or its transfer agent of
new Securities in substitution therefor, other than the Purchaser's or such
holder's unsecured written agreement reasonably satisfactory to indemnify the
Company or its transfer agent.
3.5 DELIVERY OF FINANCIAL STATEMENTS AND REPORTS
The Company will deliver to each Purchaser of Transfer Restricted
Securities the following:
(a) as soon as available, but in any event not later than 45 days
after the last day of each fiscal quarter, a balance sheet of the Company as of
the end of such quarter and related statements of operations, changes in
financial position and changes in stockholders' equity of the Company for such
quarter and for the portion of the fiscal year through such date, all in
reasonable detail and prepared in accordance with generally accepted accounting
principles consistently applied;
(b) as soon as available, but in any event not later than 120 days
after the close of each fiscal year, an audited balance sheet of the Company as
of the close of such fiscal year, and related audited statements of operations,
changes in financial position and changes in stockholders' equity of the Company
for such fiscal year, reported on without qualification arising from the scope
of the audit by a nationally recognized firm of independent certified public
accountants and prepared in accordance with generally accepted accounting
principles consistently applied; and
(c) as soon as available, one copy of (i) each financial statement,
report, notice or proxy statement sent by the Company to public securities
holders generally, (ii) each regular or periodic report, each registration
statement, and each prospectus and all amendments thereto filed by the Company
with the Commission, and (iii) all press releases or other statements made
available generally by the Company to the public concerning material
developments.
The Company will deliver to each Purchaser of Transfer Restricted
Securities, with reasonable promptness, such other data and information relating
to the business, operations, affairs, financial condition, assets or properties
of the Company or relating to the ability of the Company to perform its
obligations hereunder and under the other Documents as may from time to time be
reasonably requested by any such Purchaser.
SECTION 4. COMPANY'S REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to you as follows:
4.1 ORGANIZATION, STANDING AND QUALIFICATION
(a) The Company is a corporation duly organized, validly existing and
in good standing under the laws of its jurisdiction of incorporation; has all
requisite power and authority to own
11
or lease and operate its properties and to carry on its business as now
conducted and as proposed to be conducted; and is duly qualified or licensed to
do business as a foreign corporation in good standing in all jurisdictions in
which it owns or leases property or in which the conduct of its business
requires it to so qualify or be licensed, except for such jurisdictions where
the failure to so qualify or be licensed would not have a material adverse
effect on the business or financial condition of the Company. The Company has
heretofore delivered to your counsel complete and correct copies of its Charter
Documents as presently in effect and has identified on Schedule 4.1(a) all
jurisdictions in which it is qualified or licensed to do business as a foreign
corporation.
(b) The Company has all requisite power and authority to enter into
and perform all of its obligations under this Agreement and the other Documents,
to issue the Securities and to carry out the transactions contemplated hereby
and thereby.
(c) The Company has no Subsidiaries.
4.2 CAPITALIZATION
As of the Closing, the authorized capital stock of the Company will
consist of 50,000,000 shares of Preferred Stock, $.01 par value, of which no
shares will be issued and outstanding, and 150,000,000 shares of Common Stock,
$.01 par value, of which approximately 30,000,000 shares (subject to adjustment
as necessary or appropriate to effect the distribution of the Company's Common
Stock to the stockholders of Excel Realty Trust, Inc., as contemplated by the
Private Placement Memorandum) will be issued and outstanding.
As of the Closing, all such outstanding shares will have been duly and
validly issued and will be fully paid and nonassessable.
As of the Closing, except as set forth on Schedule 4.2 hereto, and
except as contemplated by the Certificate of Designation, (a) there will be no
outstanding subscriptions, warrants, options, calls or commitments of any
character relating to or entitling any Person to purchase or otherwise acquire
any stock of the Company; (b) there will be no obligations or securities
convertible into or exchangeable or exercisable for shares of any stock of the
Company or any commitments of any character relating to or entitling any Person
to purchase or otherwise acquire any such obligations or securities; and (c)
there will be no preemptive or similar rights to subscribe for or to purchase
any stock of the Company.
As of the Closing, the Securities will have been duly and validly
authorized and when sold and paid for in accordance with this Agreement will be
validly issued, fully paid, nonassessable and free of all Liens.
As of the Closing, all shares of Common Stock to which you and the
Other Purchasers will be entitled upon conversion of the Securities (a) will be
duly authorized by the Company's Charter Documents, (b) will have been duly
authorized by the Company's Board of Directors to be issued upon the conversion
of the Securities from time to time in whole or in part, in accordance with the
terms of the Securities, (c) will at the time of the conversion of the
Securities be, duly and validly issued, fully paid and nonassessable and free of
all Liens, and (d) will not at the time of receipt by such holder be subject to
any restrictions on transfer or sale, including any restrictions imposed by
applicable securities laws.
12
Except as disclosed in the Registration Rights Agreement, the Company
has not entered into any agreement to register its equity or debt securities
under the Securities Act.
4.3 AUTHORIZATION OF AGREEMENT AND OTHER DOCUMENTS
The Company has taken all actions necessary to authorize it to enter
into and perform its obligations under this Agreement, the Securities and the
other Documents and to consummate the transactions contemplated hereby and
thereby. This Agreement is, and, as of the Closing Date, the Documents and the
Securities will be, legal, valid and binding obligations of the Company,
enforceable in accordance with their respective terms, except for (a) the effect
upon the Documents and the Securities of bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting the rights of
creditors generally and (b) limitations imposed by federal or state law or
equitable principles upon the specific enforceability of any of the remedies,
covenants or other provisions of the Documents and the Securities and upon the
availability of injunctive relief or other equitable remedies.
4.4 NO VIOLATION
Neither the execution or delivery of the Documents nor the issuance,
sale or delivery of the Securities, nor the performance by the Company of its
obligations under the Documents and the Securities, nor the consummation of the
transactions contemplated hereby and thereby, will
(a) violate any provision of the Charter Documents of the
Company;
(b) violate any statute or law or any judgment, decree, order,
regulation or rule of any court or governmental authority to which the
Company or any of its properties may be subject;
(c) cause the acceleration of the maturity of any debt or
obligation of the Company; or
(d) violate, or be in conflict with, or constitute a default
under, or permit the termination of, or require the consent of any Person
under, or result in the creation of any Lien upon any property of the
Company under, any material agreement to which the Company is a party or by
which the Company (or its properties) may be bound.
The Company is not in default (without giving effect to any grace or
cure period or notice requirement) under any agreement to which it is a party,
which default would reasonably be expected to have a material adverse effect on
the business or financial condition of the Company.
4.5 USE OF PROCEEDS
The net proceeds from the sale of the Securities will be used solely
for the purposes set forth in the Private Placement Memorandum.
4.6 INDEBTEDNESS
Schedule 4.6 hereto sets forth and identifies in reasonable detail all
outstanding short-term and long-term indebtedness of the Company, prior to and
after giving effect to the transactions contemplated by Section 4.5 hereof.
13
4.7 FINANCIAL STATEMENTS
You have been furnished an unaudited pro forma balance sheet of the
Company as of October 31, 1997 and an unaudited pro forma statement of
operations for the year ended July 31, 1997.
Except as otherwise stated in the notes thereto, such financial
statements (which reflect all adjustments, consisting only of normally recurring
accruals which, in the opinion of the Company, are necessary for fair
presentation) have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis through all the periods
involved and fairly present the financial position and results of operations of
the Company as of the dates and for the periods indicated.
Except as reflected in such financial statements and except as
contemplated by this Agreement, the Company has no material liabilities,
absolute or contingent, other than ordinary course liabilities incurred since
the last date of such financial statements in connection with the conduct,
consistent with past practices, of the business of the Company.
4.8 FULL DISCLOSURE
The Company has delivered to you and to each Other Purchaser a copy of
the Private Placement Memorandum relating to the transactions contemplated
hereby. The Private Placement Memorandum fairly describes, in all material
respects, the general nature of the business and principal properties of the
Company. Neither this Agreement, nor any of the other Documents, nor any
document contemplated hereby or thereby or furnished by or on behalf of the
Company to you in connection with the negotiation and the sale of the
Securities, nor the financial statements referred to in Section 4.7 hereof, nor
the Private Placement Memorandum, contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements contained
herein or therein, in light of the circumstances under which they were made, not
misleading. There is no fact known to the Company which the Company has not
disclosed to you in the Private Placement Memorandum or herein which materially
adversely affects, or insofar as the Company can reasonably foresee will
materially adversely affect, the properties, business, prospects, operations,
earnings, assets, liabilities or condition (financial or otherwise) of the
Company or the ability of the Company to perform its obligations under this
Agreement, the Securities, the other Documents or any document contemplated
hereby or thereby.
4.9 LITIGATION
There is no action, proceeding or investigation pending, or to the
best knowledge of the Company, threatened, against or affecting the Company in
any court or before any governmental authority or arbitration board or tribunal,
foreign or domestic, except for such actions which, if adversely determined,
singly and in the aggregate, would not have a material adverse effect on the
Company, and there is no such action seeking to restrain, enjoin, prevent the
consummation of or otherwise challenge this Agreement or any of the other
Documents or the transactions contemplated hereby or thereby.
The Company is not subject to any judgment, order, decree, rule or
regulation of any court, governmental authority or arbitration board or tribunal
which has materially adversely affected or which can reasonably be expected to
have a material adverse effect on its business.
14
4.10 TITLE TO AND CONDITION OF PROPERTIES
Schedule 4.10 hereto sets forth and identifies in reasonable detail
all real properties, notes receivable and other assets to be owned by the
Company as of the Closing. Except for such defects of title or Liens as are
immaterial in the aggregate to the business of the Company, and except as
disclosed in the Company's pro forma financial statements for the year ended
July 31, 1997, the Company will have as of the Closing good and marketable title
to all of the real properties, notes receivable and other assets listed on
Schedule 4.10, free and clear of all Liens.
All material leases and other material agreements to which the Company
will be a party as of the Closing are valid and binding and in full force and
effect, no default has occurred or is continuing thereunder and no consent need
be obtained (other than consents which have been or will be obtained prior to
the Closing) from any Person in respect of any such lease or agreement in
connection with the transactions contemplated hereby.
None of the properties or assets, the value of which is reflected in
the balance sheet referred to in Section 4.7 hereof, is held under any lease or
as conditional vendee under any conditional sale or other title retention
agreement.
Except for such assets as are immaterial in the aggregate to the
business of the Company, all tangible assets to be owned by the Company as of
the Closing are in good condition and repair and are adequate, in the Company's
reasonable opinion, for the uses to which they are being put or would be put in
the ordinary course of business; and none of such assets is in need of
maintenance or repair, except for routine maintenance and repair.
4.11 TAXES
All tax returns required to be filed by the Company in any
jurisdiction (including foreign jurisdictions) have been so filed, and all
taxes, assessments, fees and other charges due or claimed to be due from the
Company which are due and payable have been paid, other than those being
contested in good faith or those currently payable without penalty or interest.
The Company does not know of any actual or proposed material additional tax
assessments for any fiscal period against it. The Company knows of no basis for
any other tax or assessment that could reasonably be expected to have a material
adverse effect on the business or financial condition of the Company. None of
the Company's tax returns are under audit, and no waivers of the statute of
limitations or extensions of time with respect to any tax returns have been
granted by the Company.
4.12 ERISA
(a) The execution and delivery of this Agreement, the other Documents and
the sale of the Securities to be purchased by you will not involve any
prohibited transaction within the meaning of ERISA or Section 4975 of the Code.
The representation made by the Company in the preceding sentence is made in
reliance upon and subject to the accuracy of your representation in Section 1.3
hereof as to the source of the funds to be used by you to purchase said
Securities.
(b) The Company is in compliance in all material respects with any
applicable provisions of ERISA and the Code and the regulations and published
interpretations thereunder with respect to all employee pension benefit plans
(collectively, "Pension Plans") and all employee welfare benefit plans
(collectively, "Welfare Plans") maintained or contributed to by the Company. No
reportable event has
15
occurred or is reasonably expected to occur with respect to any Pension Plan.
The Company has no obligation to make any payment to or with respect to any
former employee of the Company pursuant to any retiree medical benefit or other
Welfare Plan.
As used in this Section 4.12, the terms "employee pension benefit
plan," "employee welfare benefit plan" and "reportable event" shall have the
meanings assigned to such terms in ERISA.
4.13 COMPLIANCE WITH LAWS
The Company is not in violation of any statutes, laws, ordinances,
governmental rules or regulations or any judgment, order or decree (federal,
state, local or foreign) to which it is subject, nor has it failed to obtain any
licenses, permits, franchises or other governmental authorizations necessary to
the ownership or operation of its properties or the conduct of its business,
except for such violations and failures to obtain that are immaterial to the
properties, business, prospects, operations, earnings, assets, liabilities or
condition (financial or otherwise) of the Company.
4.14 GOVERNMENTAL CONSENTS
Neither the nature of the Company nor of any of its businesses or
properties, nor any relationship between the Company and any other Person, nor
any circumstance in connection with the offer, issuance, sale or delivery of the
Securities or the Common Stock issuable upon conversion of the Securities, as
contemplated hereby and in the other Documents, is such as to require a consent,
approval or authorization of, or filing, registration or qualification with, any
governmental authority on the part of the Company as a condition to the
execution and delivery of this Agreement or the offer, issuance, sale or
delivery of the Securities at the Closing, or the Common Stock issuable upon
conversion of the Securities, other than the filings, registrations or
qualifications under the state securities laws or "blue sky" laws of any state
of the United States of America that may be required to be made or obtained, all
of which either shall have been made and obtained on the Closing Date (and
copies of which delivered to you) or shall have no bearing on the validity and
enforceability of this Agreement, the other Documents and the Securities.
4.15 NO VIOLATION OF REGULATIONS OF BOARD OF GOVERNORS OF FEDERAL RESERVE SYSTEM
None of the transactions contemplated by this Agreement (including,
without limitation, the use of the proceeds from the sale of the Securities)
will violate or result in a violation of Section 7 of the Exchange Act or any
regulation issued pursuant thereto, including, without limitation, Regulations
G, T, U and X of the Board of Governors of the Federal Reserve System. None of
the proceeds from the sale of the Securities will be used to purchase or carry
(or refinance any borrowing the proceeds of which were used to purchase or
carry) any "security" within the meaning of the Exchange Act. The services
provided by the Placement Agent in connection with the offer and sale of the
Securities by the Company have been provided as part of the investment banking
services rendered to the Company by the Placement Agent.
4.16 PRIVATE OFFERING
Assuming that your representations set forth in Section 1.3 hereof are
true and correct, the sale of the Securities hereunder is exempt from the
registration and prospectus delivery requirements of the Securities Act. In the
case of each offer or sale of the Securities, no form of general solicitation or
general advertising was used by the Company or its representatives, including,
but not limited to,
16
advertisements, articles, notices or other communications published in any
newspaper, magazine or similar medium or broadcast over television or radio, or
any seminar or meeting whose attendees have been invited by any general
solicitation or general advertising.
You and the Other Purchasers are the sole purchasers of the
Securities. No securities of the same class as the Securities have been issued
and sold by the Company within the six-month period immediately prior to the
date hereof. The Company agrees that neither it, nor anyone acting on its
behalf, will offer the Securities so as to bring the issuance and sale of the
Securities within the provisions of Section 5 of the Securities Act nor offer
any similar securities for issuance or sale to, or solicit any offer to acquire
any of the same from, or otherwise approach or negotiate with respect thereto
with, anyone if the sale of the Securities and any such securities would be
integrated as a single offering for the purposes of the Securities Act,
including, without limitation, Regulation D thereunder.
4.17 LABOR RELATIONS
The Company is not engaged in any unfair labor practice which would
have a material adverse effect on the Company. There is (a) no unfair labor
practice complaint pending or threatened against the Company before the National
Labor Relations Board and no grievance or arbitration proceeding arising out of
or under collective bargaining agreements is so pending or threatened, (b) no
strike, labor dispute, slowdown or stoppage pending or threatened against the
Company, and (c) no union representation question existing with respect to the
employees of the Company and no union organizing activities are taking place.
4.18 GOVERNMENTAL REGULATIONS
The Company is not subject to regulation under the Investment Company
Act of 1940, as amended, the Public Utility Holding Company Act of 1935, as
amended, the Federal Power Act, the Interstate Commerce Act or to any federal or
state statute or regulation limiting its ability to incur indebtedness for
borrowed money.
4.19 ENVIRONMENTAL MATTERS
Except in all cases as, in the aggregate, have not had and could not
reasonably be expected to have a material adverse effect on the business or
financial condition of the Company, the Company (a) has obtained all applicable
permits, licenses and other authorizations which are required to be obtained
under all applicable federal, state or local laws or any regulation, code, plan,
order, decree, judgment, notice or demand letter issued, entered, promulgated or
approved thereunder relating to pollution or protection of the environment,
including laws relating to emissions, discharges, releases or threatened
releases of pollutants, contaminants, or hazardous or toxic wastes into ambient
air, surface water, ground water, or land or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport, or handling of pollutants, contaminants or hazardous or toxic
materials or wastes ("Environmental Laws") by the Company; (b) is in compliance
with all terms and conditions of such required permits, licenses and
authorizations, and also is in compliance with all other limitations,
restrictions, conditions, standards, prohibitions, requirements, obligations,
schedules and timetables contained in applicable Environmental Laws; (c) is not
aware of nor has received notice of any past or present violations of
Environmental Laws or any event, condition, circumstance, activity, practice,
incident, action or plan which is reasonably likely to interfere with or prevent
continued compliance with or which could give rise to any common law or
statutory liability, or otherwise form the basis of any claim, action, suit or
proceeding, against the Company based on or resulting from the manufacture,
17
processing, distribution, use, treatment, storage, disposal, transport or
handling, or the emission, discharge or release into the environment, of any
pollutant, contaminant or hazardous or toxic material or waste; and (d) has
taken all actions necessary under applicable Environmental Laws to register any
products or materials required to be registered by the Company thereunder.
4.20 BROKERS
The Company has dealt with no broker, finder, commission agent or
other Person in connection with the sale of the Securities and the transactions
contemplated by this Agreement, other than BancBoston Securities Inc., and the
Company is under no obligation to pay any broker's fee or commission in
connection with such transactions, other than a fee payable to BancBoston
Securities Inc. for investment banking services rendered in connection with such
transactions, which fee is the sole obligation of the Company.
4.21 FOREIGN ASSETS CONTROL REGULATIONS, ETC.
Neither the sale of the Securities by the Company hereunder nor its
use of the proceeds thereof will violate the Trading with the Enemy Act, as
amended, or any of the foreign assets control regulations of the United States
Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto.
4.22 RESTRICTIONS ON DIVIDENDS
The Company is not a party to, or otherwise subject to, any legal
restriction or any agreement (other than this Agreement and customary
limitations imposed by corporate law statutes) restricting the ability of the
Company to pay dividends out of profits or make any other similar distributions
of profits.
4.23 SURVIVAL OF REPRESENTATIONS AND WARRANTIES
All statements contained in any certificate or other document
delivered to you by or on behalf of the Company pursuant to or in connection
with this Agreement or the other Documents shall be deemed to constitute
representations and warranties under this Agreement with the same force and
effect as the representations and warranties expressly set forth herein. All
the Company's representations and warranties thereunder and hereunder shall
survive the execution and delivery of the same, any investigation by you and the
issuance of the Securities.
SECTION 5. DEFINITIONS
As used in this Agreement, the following terms shall have the
following meanings:
AFFILIATE: See Section 1.3(c).
AGENT: Any person authorized to act and who acts on behalf of any of
the Purchasers with respect to the transactions contemplated by the Documents.
AGREEMENT: See Section 1.2.
18
CERTIFICATE OF DESIGNATION: See Section 1.1.
CHARTER DOCUMENTS: The Certificate of Incorporation and Bylaws, as
amended or restated (or both) to date, of the Company.
CLOSING: See Section 1.2.
CLOSING DATE: See Section 1.2.
CODE: The Internal Revenue Code of 1986, as amended.
COMMISSION: Securities and Exchange Commission.
COMMON STOCK: The common stock, $.01 par value, of the Company.
COMPANY: See preamble hereto.
DOCUMENTS: This Agreement, the Registration Rights Agreement and the
Certificate of Designation, collectively, together with any exhibits, schedules
or other attachments thereto.
DTC: See Section 1.2.
ENVIRONMENTAL LAWS: See Section 4.19.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended from time to time.
EXCHANGE ACT: See Section 1.8(b).
LIEN: Any material mortgage, pledge, lien, encumbrance, charge or
adverse claim affecting title or resulting in a charge against real or personal
property, or security interest of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof, any option or
other agreement to sell and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).
LOSSES: See Section 1.6.
OTHER PURCHASE AGREEMENTS: See Section 1.2.
OTHER PURCHASERS: See Section 1.2.
PENSION PLANS: See Section 4.12(b).
PERSON: An individual, partnership, corporation, trust or
unincorporated organization or a government or agency or political subdivision
thereof.
PLACEMENT AGENT: BancBoston Securities Inc.
PORTAL: See Section 1.4(d).
19
PRIVATE PLACEMENT MEMORANDUM: The Private Placement Memorandum dated
December 1997 and all exhibits, schedules or other attachments thereto.
PURCHASERS: Those Persons who have executed a counterpart of this
Agreement.
QIB: See Section 1.3(a).
REGISTRATION RIGHTS AGREEMENT: See Section 1.1.
RULE 144: Rule 144 as promulgated by the Commission under the
Securities Act, and any successor rule or regulation thereto.
SECURITIES: See Section 1.1.
SECURITIES ACT: See Section 1.1.
SUBSIDIARY: Any corporation, a majority of the outstanding voting
securities of which is owned, directly or indirectly, by the Company.
TRANSFER RESTRICTED SECURITIES: Securities acquired by the holder
thereof other than pursuant to an effective registration under Section 5 of the
Securities Act or pursuant to Rule 144; a Security that has ceased to be a
Transfer Restricted Security cannot thereafter become a Transfer Restricted
Security.
WELFARE PLANS: See Section 4.12(b).
SECTION 6. MISCELLANEOUS
6.1 NOTICES
Prior to the Closing, and thereafter with respect to matters
pertaining to this Agreement only, all notices and other communications provided
for or permitted hereunder shall be made by hand-delivery, first-class mail,
telex, telecopier, or overnight air courier guaranteeing next day delivery:
(a) if to you at your address set forth on the signature page
hereof; and
(b) if to the Company, at its address set forth on the first
page of this Agreement, Attention: Chief Executive Officer, with a copy to
Xxxxxx & Xxxxxxx, 000 "X" Xxxxxx, Xxxxx 0000, Xxx Xxxxx, Xxxxxxxxxx 00000,
Attention: Xxxxx X. Xxxxx, Esq.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back if telexed; when receipt acknowledged, if telecopied; and the next
business day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.
From and after the Closing, the foregoing notice provisions shall be
superseded by any notice provisions of the Document under which notice is given.
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6.2 SUCCESSORS AND ASSIGNS
This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties, including without limitation and
without the need for an express assignment, subsequent holders of Transfer
Restricted Securities.
6.3 AMENDMENT AND WAIVER
(a) Prior to the Closing Date, this Agreement and the other Documents
may be amended, modified or supplemented, and waivers or consents to departures
from the provisions hereof may be given, provided that the same are in writing
and signed by you and the Company. Thereafter, the Documents (other than this
Agreement) may only be so amended, and such waivers be given, in accordance with
the provisions of the applicable Document.
(b) The Company will provide each Purchaser of the Securities
(irrespective of the number of Securities then held by it) with reasonably
sufficient information, at least five business days (or such shorter period as
is mutually acceptable to the Company and such Purchaser) prior to the date a
decision is required, to enable such holder to make an informed and considered
decision with respect to any proposed amendment, waiver or consent in respect of
any of the provisions hereof or of the Registration Rights Agreement or of the
Certificate of Designation. The Company will deliver executed or true and
correct copies of each amendment, waiver or consent effected pursuant to the
provisions of this Section 6.3 to each Purchaser of outstanding Securities
promptly following the date on which it is executed and delivered by, or
receives the consent or approval of, the requisite holders of Securities.
(c) The Company will not directly or indirectly pay or cause to be
paid any remuneration in any form whatsoever, or grant any security, to any
Purchaser of Securities as consideration for or as an inducement to the entering
into by any Purchaser of Securities of any waiver or amendment of any of the
terms and provisions hereof or of the Registration Rights Agreement or of the
Certificate of Designation unless such remuneration is concurrently paid, or
security is concurrently granted, on the same terms, ratably to each Purchaser
of Securities then outstanding even if such Purchaser did not consent to such
waiver or amendment.
6.4 COUNTERPARTS
This Agreement may be executed in any number of counterparts and by
the parties hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
6.5 HEADINGS
The headings in this Agreement are for convenience of reference only
and shall not limit or otherwise affect the meaning hereof.
6.6 GOVERNING LAW
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
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6.7 ENTIRE AGREEMENT
This Agreement, together with the other Documents and the Securities,
is intended by the parties as a final expression of their agreement and intended
to be a complete and exclusive statement of the agreement and understanding of
the parties hereto in respect of the subject matter contained herein and
therein. There are no restrictions, promises, warranties or undertakings, other
than those set forth or referred to herein and therein. This Agreement,
together with the other Documents and the Securities, supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
6.8 SEVERABILITY
In the event that any one or more of the provisions contained herein,
or the application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired or affected, it being
intended that all of your rights and privileges shall be enforceable to the
fullest extent permitted by law.
6.9 DELIVERY
Each Purchaser hereby appoints the Placement Agent to accept delivery
of the Securities to be purchased by such Purchaser at the Closing and execute a
receipt for such Securities on such Purchaser's behalf.
6.10 PUBLIC DISCLOSURES
The Company covenants that it will take all reasonable actions
necessary to keep your identity confidential, and will not disclose your
identity as an investor in the Company in any public announcement, governmental
filing or otherwise without your prior written consent unless such disclosure is
compelled by law or by order of a court of competent jurisdiction; in which case
prior to making such disclosure the Company will give written notice to you
describing in all reasonable detail the proposed content of such disclosure and
will afford you an opportunity to suggest modifications in the form and
substance of such proposed disclosure.
[Signature pages follow]
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If this Agreement is satisfactory to you, please so indicate by
signing the acceptance at the foot of a counterpart of this Agreement and
deliver such counterpart to the Company whereupon this Agreement will become
binding between us in accordance with its terms.
Very truly yours,
EXCEL LEGACY CORPORATION
By: /s/ Xxxx X. Xxxxx
-------------------------------
Name: Xxxx X. Xxxxx
Title: President and Chief Executive Officer
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Accepted and Agreed as of the
date first written above:
LONGLEAF PARTNERS REALTY FUND
---------------------------------
(Print or type name of Purchaser)
By: Southeastern Asset Management, Inc.
---------------------------------------
(If an institution is executing
this Agreement as agent for the
Purchaser, type or print name
of institution)
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------
(Signature of individual
executing on behalf of Purchaser
or institutional agent of Purchaser)
Print or Type
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President - Longleaf Partners Realty Fund
Vice President & General Counsel - Southeastern Asset
Management, Inc.
Number of Securities to
be purchased by you:
10,344,000 shares at $5.00 per share
Name and Address Longleaf Partners Realty Fund
of Purchaser: 0000 Xxxxxx Xxx., Xxxxx 000; Memphis, TN
------------- 38119
Attention: Xxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy No: (000) 000-0000
Tax I.D. No: 00-0000000
(If registered in the name of
a Nominee, the Nominee's
Tax I.D. Number)
State of Principal Place of Business:
Longleaf Partners Realty Fund is a
series of a Massachusetts business trust,
Longleaf Partners Funds Trust
Nominee (Name in which Securities are
to be registered if different than name
of Purchaser): Keypunch & Co.
(Nominee name used by
State Street Bank & Trust
Co. for Longleaf Partners
Realty Fund)
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Accepted and Agreed as of the
date first written above:
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
(Print or type name of Purchaser)
By:
-------------------------------------
(If an institution is executing
this Agreement as agent for the
Purchaser, type or print name
of institution)
By: /s/ Xxxxxx X. Xxxxx
-----------------------
(Signature of individual
executing on behalf of Purchaser
or institutional agent of Purchaser)
Print or Type
Name: Xxxxxx X. Xxxxx
Title: Vice President
Number of Securities to
be purchased by you:
2,000,000 shares at $5 per share
Name and Address SEE EXHIBIT A
of Purchaser:
-------------
Attention:
Telephone: ( ) ____-_________
Telecopy No: ( ) ____-_________
Tax I.D. No: 00-0000000
(If registered in the name of
a Nominee, the Nominee's
Tax I.D. Number)
State of Principal Place of Business:
WISCONSIN
Nominee (Name in which Securities are
to be registered if different than name
of Purchaser):
-------------
25
Accepted and Agreed as of the
date first written above:
ALLSTATE INSURANCE COMPANY
(Print or type name of Purchaser)
By:
------------------------------------
(If an institution is executing
this Agreement as agent for the
Purchaser, type or print name
of institution)
By: /s/ Allstate Insurance Company By: /s/ Allstate Insurance Company
------------------------------ ------------------------------
(Signature of individual Authorized Signatory
executing on behalf of Purchaser
or institutional agent of Purchaser)
Print or Type
Name:
-----------------------------------
Title: Authorized Signatory
Number of Securities to * Up to 2,000,000 Securities, at $5.00 per share,
be purchased by you: provided, however, in no event shall Allstate
Insurance Company's ownership interest in the
* shares Securities exceed 9.99%. In addition to the
------- aforementioned ownership limitation, the dollar
amount of Allstate's investment in the Securities
shall not exceed $10,000,000. Notwithstanding the
above, the dollar amount of Allstate's investment
shall not be less than $8,205,000.
Name and Address 0000 Xxxxxxx Xxxx, Xxxxx X0X
of Purchaser: Xxxxxxxxxx, Xxxxxxxx 00000
-------------
Attention: Director, Real Estate Equity Investments
Telephone: 000-000-0000
Telecopy No: 000-000-0000
Tax I.D. No: 00-0000000
(If registered in the name of
a Nominee, the Nominee's
Tax I.D. Number)
State of Principal Place of Business:
Illinois
Nominee (Name in which Securities are
to be registered if different than name
of Purchaser):
--------------
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Accepted and Agreed as of the
date first written above:
BANC BOSTON CAPITAL INC.
(Print or type name of Purchaser)
By: /s/ Banc Boston Capital Inc.
----------------------------
(If an institution is executing
this Agreement as agent for the
Purchaser, type or print name
of institution)
By:
----------------------------
(Signature of individual
executing on behalf of Purchaser
or institutional agent of Purchaser)
Print or Type
Name:
---------------------------------
Title:
------------------------------
Number of Securities to
be purchased by you:
2,440,000 shares at $5 per share
Name and Address
of Purchaser:
-------------
Attention:
Telephone: 000-000-0000
Telecopy No: 000-000-0000
Tax I.D. No: 00-0000-000
(If registered in the name of
a Nominee, the Nominee's
Tax I.D. Number)
State of Principal Place of Business:
Massachusetts
Nominee (Name in which Securities are
to be registered if different than name
of Purchaser):
-------------
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