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EXHIBIT 1.2
1,200,000 Shares
ENTERTAINMENT PROPERTIES TRUST
Common Shares of Beneficial Interest
UNDERWRITING AGREEMENT
June 4, 1999
CIBC World Markets Corp.
Xxx Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Entertainment Properties Trust, a Maryland real estate
investment trust (the "Company"), proposes, subject to the terms and conditions
contained herein, to sell to you (the "Underwriter"), an aggregate of 1,200,000
shares (the "Firm Shares") of the Company's common shares of beneficial
interest, $.01 par value (the "Common Shares"). In addition, the Company
proposes to grant to the Underwriter an option to purchase up to an additional
180,000 Common Shares (the "Option Shares") from it for the purpose of covering
over-allotments in connection with the sale of the Firm Shares. The Firm Shares
and the Option Shares are together called the "Shares."
1. Sale and Purchase of the Shares.
On the basis of the representations, warranties and
agreements contained in, and subject to the terms and conditions of, this
Agreement:
(a) The Company agrees to sell to the Underwriter, and the
Underwriter agrees to purchase from the Company, at a price of
$17.58 per share (the "Initial Price"), 1,200,000 Firm Shares.
(b) The Company grants to the Underwriter an option to
purchase all or any part of the Option Shares at the Initial Price.
Such option may be exercised only to cover any over-allotment in
the sale of the Firm Shares by the Underwriter and may be exercised
in whole or in part at any time on or before 12:00 noon, New York
City time, on the business day before the Firm Shares Closing Date
(as defined below), and from time to time thereafter within 30 days
after the date of this Agreement, in each case upon written,
facsimile or telegraphic notice, or verbal or telephonic notice
confirmed by written, facsimile or telegraphic notice, by the
Underwriter to the Company no later than 12:00 noon, New York City
time, on the business day before the Firm Shares Closing Date or at
least two business days before the Option Shares Closing Date (as
defined below), as the case may
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be, setting forth the number of Option Shares to be purchased and
the time and date (if other than the Firm Shares Closing Date) of
such purchase.
2. Delivery and Payment. Delivery by the Company of the
Firm Shares to the Underwriter for its account, and payment of the purchase
price in immediately available funds by wire transfer to the Company at the bank
account designated in writing by the Company for the Shares purchased from the
Company, against delivery of the respective certificates therefor to the
Underwriter, shall take place at the offices of CIBC World Markets Corp., at
CIBC World Markets Tower, World Financial Center, Xxx Xxxx, Xxx Xxxx 00000, at
10:00 a.m., New York City time, on the fourth business day following the date of
this Agreement, or at such time on such other date, not later than 10 business
days after the date of this Agreement, as shall be agreed upon by the Company
and the Underwriter (such time and date of delivery and payment are called the
"Firm Shares Closing Date").
In the event the option with respect to the Option Shares
is exercised in whole or in part on one or more occasions, delivery by the
Company of the Option Shares to the Underwriter for its account and payment of
the purchase price thereof in immediately available funds by wire transfer to
the Company at the bank account designated in writing by the Company shall take
place at the offices of CIBC World Markets Corp. specified above at the time and
on the date (which may be the same date as, but in no event shall be earlier
than, the Firm Shares Closing Date) specified in the notice referred to in
Section 1(b) (such time and date of delivery and payment are called the "Option
Shares Closing Date"). The Firm Shares Closing Date and the Option Shares
Closing Date are called, individually, a "Closing Date" and, together, the
"Closing Dates."
Certificates evidencing the Shares shall be registered in
such names and shall be in such denominations as the Underwriter shall request
at least two full business days before the Firm Shares Closing Date or, in the
case of Option Shares, on the day of notice of exercise of the option as
described in Section l(b) and shall be made available to the Underwriter for
checking and packaging, at such place as is designated by the Underwriter, on
the full business day before the Firm Shares Closing Date (or the Option Shares
Closing Date in the case of the Option Shares).
3. Representations and Warranties of the Company. The
Company hereby represents and warrants to the Underwriter as follows:
(a) A registration statement on Form S-3 (File No.
333-78727), with respect to the Common Shares, including a
prospectus, have been carefully prepared by the Company in
conformity with the requirements of the Securities Act of 1933, as
amended (the "Securities Act"), and the rules and regulations (the
"Securities Rules") of the Securities and Exchange Commission (the
"Commission") thereunder, and have been filed with the Commission
and declared effective. Such registration statement and prospectus
may have been amended or supplemented prior to the date of this
Underwriting Agreement; any such amendment of such registration
statement or supplement was so prepared and filed, and any such
amendment filed after the effective date of such registration
statement (the "Effective Date") has been declared effective. No
stop order suspending the effectiveness of the registration
statement has been issued, and no proceeding for that purpose has
been instituted or threatened by the Commission. A prospectus
supplement (the "Prospectus Supplement") setting forth the terms of
the offering, sale and plan of distribution of the Shares (the
"Offering") and additional information concerning the Company and
its business has been or will be so prepared and will be filed
pursuant to Rule 424(b) of the Securities Rules on or before the
second business day after the date hereof (or such earlier time as
may be required by the Securities Rules). Copies of such
registration statement and prospectus, any such amendments or
supplements and all
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documents incorporated by reference therein that were filed with
the Commission on or prior to the date of this Agreement (including
one fully executed copy of the registration statement and of each
amendment thereto for the Underwriter and its counsel) have been
delivered to the Underwriter and its counsel. The registration
statement, as it may have heretofore been amended, is referred to
herein as the "Registration Statement," and the final form of
prospectus included in the Registration Statement, as supplemented
by the Prospectus Supplement, is referred to herein as the
"Prospectus." Any reference herein to the Registration Statement,
the Prospectus or any amendment or supplement thereto shall be
deemed to refer to and include the documents incorporated by
reference therein, and any reference herein to the terms "amend,"
"amendment" or "supplement" with respect to the Registration
Statement or Prospectus shall be deemed to refer to and include the
filing after the execution hereof of any document with the
Commission deemed to be incorporated by reference therein. For
purposes of this Agreement, all references to the Registration
Statement and Prospectus or to any amendment or supplement thereto
shall be deemed to include any copy filed with the Commission
pursuant to its Electronic Data Gathering Analysis and Retrieval
System (XXXXX), and such copy shall be identical in content to any
Prospectus delivered to you for use in connection with the offering
of the Shares.
(b) Each part of the Registration Statement, when such
part became or becomes effective and the Prospectus and any
amendment or supplement thereto, on the date of filing thereof with
the Commission and at the Firm Shares Closing Date and, if later,
at an Option Shares Closing Date, conformed or will conform in all
material respects with the requirements of the Securities Act and
the Securities Rules; each part of the Registration Statement, when
such part became or becomes effective, or when such part was filed
with the Commission, did not or will not contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; the Prospectus and any amendment or
supplement thereto, on the date thereof and at the Firm Shares
Closing Date and, if later, at an Option Shares Closing Date, did
not or will not include an untrue statement of a material fact or
omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; except that the foregoing shall not apply to
statements in, or omissions from, any such document in reliance
upon, and in conformity with, written information concerning the
Underwriter that was furnished to the Company by the Underwriter
specifically for use in the preparation thereof.
(c) The documents incorporated by reference in the
Registration Statement, the Prospectus, any amendment or supplement
thereto, when they became or become effective under the Securities
Act or were or are filed with the Commission under the Securities
Act or the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), as the case may be, conformed or will conform in
all material respects with the requirements of the Securities Act,
the Securities Rules, the Exchange Act and/or the rules and
regulations of the Commission thereunder (the "Exchange Rules"), as
applicable.
(d) The financial statements of the Company together with
the related schedules and notes thereto, set forth or included or
incorporated by reference in the Registration Statement and
Prospectus fairly present the financial condition of the Company as
of the dates indicated and the results of operations, changes in
financial position, shareholders' equity and cash flows for the
periods therein specified, in conformity with generally accepted
accounting principles consistently applied throughout the periods
involved (except as otherwise stated therein). The summary and/or
selected financial and statistical data included or incorporated by
reference in the Registration
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Statement and the Prospectus present fairly the information shown
therein and, to the extent based upon or derived from the financial
statements, have been compiled on a basis consistent with the
financial statements presented therein. In addition, any pro forma
financial statements of the Company, and the related notes thereto,
included or incorporated by reference in the Registration Statement
and the Prospectus present fairly the information shown therein,
have been prepared in accordance with the Commission's rules and
guidelines with respect to pro forma financial statements and have
been properly compiled on the basis described therein, and the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein. Furthermore,
all financial statements required by Rule 3-05 or Rule 3-14 of
Regulation S-X ("Rule 3-05" and "Rule 3-14", respectively), if any,
have been included or incorporated by reference in the Registration
Statement and the Prospectus and any such financial statements are
in conformity with the requirements of Rule 3-05 and Rule 3-14. No
other financial statements are required to be set forth or
incorporated by reference in the Registration Statement or the
Prospectus under the Securities Act or the Securities Rules.
(e) Ernst & Young LLP, whose reports are incorporated by
reference in the Registration Statement, are and, during the
periods covered by their reports, were independent public
accountants as required by the Securities Act and the Securities
Rules.
(f) The Company has been duly organized and is validly
existing as a real estate investment trust in good standing under
the laws of the State of Maryland. Other than EPT DownReit, Inc., a
Missouri corporation, EPT DownReit II, Inc., a Missouri
corporation, and EPT DownReit North Carolina, Inc. (collectively,
the "Subsidiaries"), the Company has no subsidiary or subsidiaries
and does not control, directly or indirectly, any corporation,
partnership, joint venture, association or other business
organization. Each Subsidiary has been duly incorporated and is
validly existing as a corporation in good standing under the laws
of the State of Missouri. Each of the Company and the Subsidiaries
is duly qualified and in good standing as a foreign corporation or
other entity in each jurisdiction in which the character or
location of its assets or properties (owned, leased or licensed) or
the nature of its business makes such qualification necessary
(including every jurisdiction in which the Company or its
Subsidiaries, as the case may be, owns or leases property), except
for such jurisdictions where the failure to so qualify would not
have a material adverse effect on the assets or properties,
business, results of operations, prospects or condition (financial
or otherwise) of the Company (a "Material Adverse Effect"). Except
as disclosed or incorporated by references in the Registration
Statement and the Prospectus, neither the Company nor any of its
Subsidiaries owns, leases or licenses any asset or property or
conducts any business outside the United States of America. Each of
the Company and its Subsidiaries has all requisite corporate power
and authority, and all necessary authorizations, approvals,
consents, orders, licenses, certificates and permits of and from
all governmental or regulatory bodies or any other person or
entity, to own, lease, license and operate its assets and
properties and conduct its business as now being conducted and as
described or incorporated by reference in the Registration
Statement and the Prospectus; except for such authorizations,
approvals, consents, orders, licenses, certificates and permits the
absence of which would not have a Material Adverse Effect; and no
such authorization, approval, consent, order, license, certificate
or permit contains a materially burdensome restriction other than
as disclosed or incorporated by reference in the Registration
Statement and the Prospectus.
(g) Each of the Company and its Subsidiaries owns or
possesses adequate and enforceable rights to use all trademarks,
trademark applications, trade names, service marks, copyrights,
copyright applications, licenses, know-how and other similar rights
(collectively, the
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"Intangibles") necessary for the conduct of its business as now
being conducted and as described or incorporated by reference in
the Registration Statement and the Prospectus. Neither the Company
nor its Subsidiaries has infringed, is infringing, or has received
any notice on infringement of, any Intangible of any other person,
that will have a Material Adverse Effect and the Company does not
know of any basis therefor.
(h) Each of the Company and its Subsidiaries has good
title to each of the items of personal property which are reflected
in the financial statements referred to in Section 3(d) or are
referred to in the Registration Statement and the Prospectus or any
document incorporated by reference therein as being owned by the
Company and valid and enforceable leasehold interests in each of
the items of real and personal property which are referred to in
the Registration Statement and the Prospectus or any document
incorporated by reference therein as being leased by the Company,
in each case free and clear of all liens, encumbrances, claims,
security interests and defects, other than those described in the
Registration Statement and the Prospectus and those which do not
and will not have a Material Adverse Effect.
(i) Except with respect to certain rights of first refusal
and rights of first offer held by AMC Entertainment, Inc. and
subsidiaries on properties operated by them, the Company has good
and marketable title to, or leasehold interests in, all properties
and assets as described in the Registration Statement and the
Prospectus or any document incorporated by reference therein, owned
by the Company, free and clear of all liens, charges, encumbrances
or restrictions, except such as are described in the Registration
Statement and the Prospectus or any document incorporated by
reference therein, or are not material in relation to the business
of the Company; no lessee under any of the leases pursuant to which
the Company leases its properties has an option or right of first
refusal to purchase the premises demised under such lease; the use
and occupancy of each of the properties owned by the Company
complies in all material respects with all applicable codes and
zoning laws and regulations; the Company has no knowledge of any
pending or threatened condemnation or zoning change that will in
any material manner affect the size of, use of, improvements on,
construction on, or access to any of the properties owned by the
Company, which would have a material adverse effect upon the
proposed use of such property as an entertainment-related property
or megaplex movie theatre complex; and the Company has no knowledge
of any pending or threatened proceeding or action that will in any
material respect affect the size of, use of, improvement of,
construction on, or access to any of the properties owned by the
Company.
(j) Title insurance in favor of the mortgagee and the
Company is maintained with respect to each of the properties owned
by the Company in an amount at least equal to the greater of (i)
the cost of acquisition of such property or (ii) the cost of
construction of the improvements located on such property (measured
at the time of such construction).
(k) The mortgages and deeds of trust encumbering the
properties and assets described or incorporated by reference in the
Registration Statement and the Prospectus are not convertible into
Common Shares or other equity interest in the Company nor does the
Company hold a participating interest therein.
(l) In the event of the purchase by the Company of the
parcels of property to be purchased by it pursuant to any purchase
agreements, contracts and letters of intent referred to in the
Registration Statement and Prospectus relating to sites for
additional megaplex theatre complexes (the "Property Purchase
Agreements"), the Company will receive good and marketable title to
all
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such parcels of property (the "Proposed Acquisitions"), in each
case free and clear of all liens, charges, encumbrances, claims,
security interests, restrictions and defects, other than those that
would not have a Material Adverse Effect. To the best knowledge of
the Company: (i) the intended use and occupancy of each of the
Proposed Acquisitions complies with all applicable codes and zoning
laws and regulations, except for such failures to comply which
would not individually or in the aggregate have a material adverse
effect on the ability of the Company to develop, construct and own
a megaplex theatre complex on such parcel of property and lease it
to the owner of such megaplex theatre complex; and (ii) there is no
pending or threatened condemnation, zoning change, environmental or
other proceeding or action that will in any material respect affect
the size of, use of, improvements on, construction on, or access to
the Proposed Acquisitions.
(m) There is no litigation or governmental or other
proceeding or investigation before any court or before or by any
public body or board pending or, to the Company's best knowledge,
threatened (and the Company does not know of any basis therefor)
against, or involving the assets, properties or businesses of the
Company which would materially adversely affect the value or the
operation of any such assets or properties or the business, results
of operations, prospects or condition (financial or otherwise) of
the Company.
(n) Except as disclosed in the Registration Statement or
the Prospectus or any document incorporated by reference therein,
(i) there is not present on any of the properties owned by the
Company or the Proposed Acquisitions any hazardous substances,
hazardous materials, toxic substances, asbestos or waste materials
(collectively, "Hazardous Materials"), (ii) there has not occurred
or is not presently occurring from any of such properties any
unlawful spills, releases, discharges or disposal of Hazardous
Materials, and (iii) all such properties are in compliance with all
applicable local, state and federal environmental laws,
regulations, ordinances and administrative and judicial orders
relating to the generation, recycling, reuse, sale, storage,
handling, transport and disposal of any Hazardous Materials, which
failure would have a Material Adverse Effect.
(o) The Company will obtain and maintain title insurance
in favor of the Company on each of the Proposed Acquisitions, when
and if consummated, not later than the time that financing for the
construction of a megaplex movie theatre complex thereon is
obtained, in an amount at least equal to the cost of the
acquisition of such property.
(p) Property and casualty insurance in favor of the
Company is maintained with respect to each of the properties owned
by the Company, and will be obtained and maintained with respect to
each of the Proposed Acquisitions, when and if consummated, in an
amount and on such terms as are reasonable and customary for
businesses of this type.
(q) Subsequent to the respective dates as of which
information is given in the Registration Statement and the
Prospectus, except as described therein, (i) there has not been any
material adverse change in the assets or properties, business,
results of operations, prospects or condition (financial or
otherwise) of the Company or its Subsidiaries, whether or not
arising from transactions in the ordinary course of business; (ii)
neither the Company nor its Subsidiaries has sustained any material
loss or interference with its assets, businesses or properties
(whether owned or leased) from fire, explosion, earthquake, flood
or other calamity, whether or not covered by insurance, or from any
labor dispute or any court or legislative or other governmental
action, order or decree; and (iii) since the date of the latest
balance sheet, included or incorporated by reference in the
Registration Statement and the Prospectus, except as reflected
therein, neither the Company nor
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its Subsidiaries has undertaken any liability or obligation, direct
or contingent, except such liabilities or obligations undertaken in
the ordinary course of business.
(r) There is no document or contract of a character
required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration
Statement which is not described or filed as required. Each
mortgage, line of credit agreement, loan agreement, guarantee,
employment contract, stock option agreement, leasing agreement,
purchase agreement and all other agreements of the Company
described in the Registration Statement or the Prospectus or
incorporated by reference therein or listed as exhibits to the
Registration Statement are in full force and effect and are valid
and enforceable by and against the Company in accordance with their
terms, assuming the due authorization, execution and delivery
thereof by each of the other parties thereto. Neither the Company
nor its Subsidiaries, nor to the best of the Company's knowledge,
any other party is in default in the observance or performance of
any term or obligation to be performed by it under any such
agreement, and no event has occurred which with notice or lapse of
time or both would constitute such a default, which default or
event would have a Material Adverse Effect. No default exists, and
no event has occurred which with notice or lapse of time or both
would constitute a default, in the due performance and observance
of any term, covenant or condition, by the Company or its
Subsidiaries of any other agreement or instrument to which the
Company is a party or by which it or its properties or business may
be bound or affected, which default or event would have a Material
Adverse Effect.
(s) Neither the Company nor its Subsidiaries is in
violation of any term or provision of its respective charter or
by-laws or of any franchise, license, permit, judgment, decree,
order, statute, rule or regulation, where the consequences of such
violation would have a Material Adverse Effect.
(t) Neither the execution, delivery and performance of
this Agreement by the Company nor the consummation of any of the
transactions contemplated hereby (including, without limitation,
the issuance and sale by the Company of the Shares) will give rise
to a right to terminate or accelerate the due date of any payment
due under, or conflict with or result in the breach of any term or
provision of, or constitute a default (or an event which with
notice or lapse of time or both would constitute a default) under,
or require any consent or waiver under, or result in the execution
or imposition of any lien, charge or encumbrance upon any
properties or assets of the Company pursuant to the terms of, any
indenture, mortgage, deed of trust or other agreement or instrument
to which the Company or its Subsidiaries is a party or by which any
of them is bound, or any other respective properties or businesses
are bound, or any franchise, license, permit, judgment, decree,
order, statute, rule or regulation applicable to the Company or its
Subsidiaries or violate any provision of the charter or by-laws of
the Company or its Subsidiaries, as applicable, except for such
consents or waivers which have already been obtained and are in
full force and effect.
(u) The Company has authorized, issued and outstanding
capital stock as set forth in the balance sheet of the Company
included in its Form 10-Q for the quarter ended March 31, 1999. All
of the outstanding Common Shares have been duly authorized and
validly issued and are fully paid and nonassessable and none of
them was issued in violation of any preemptive or other similar
right. The Shares, when issued and sold pursuant to this Agreement,
will be duly authorized and validly issued, fully paid and
nonassessable and none of them will be issued in violation of any
preemptive or other similar right. Except as disclosed in the
Registration Statement and the Prospectus, there is no outstanding
option, warrant or other right calling for the issuance of, and
there is no commitment, plan or arrangement to issue, any share of
beneficial interest of the Company or
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any security convertible into or exercisable or exchangeable for,
any such share. The Common Shares and the Shares conform in all
material respects to all statements relating thereto contained in
the Registration Statement and the Prospectus.
(v) Subsequent to the respective dates as of which
information is given in the Registration Statement and the
Prospectus, except as described or referred to therein, the Company
has not (i) issued any securities or incurred any liability or
obligation, direct or contingent, except such liabilities or
obligations incurred in the ordinary course of business including,
without limitation, debt financing to acquire properties, (ii)
entered into any transaction not in the ordinary course of business
or (iii) other than the Company's regular dividend payment for the
second quarter of 1999, declared or paid any dividend or made any
distribution on any shares of its capital stock or redeemed,
purchased or otherwise acquired or agreed to redeem, purchase or
otherwise acquire any shares of its capital stock.
(w) No holder of any security of the Company has the right
which has not been waived to have any security owned by such holder
included in the Registration Statement or any right to demand
registration of any security owned by such holder during the period
ending 45 days after the date of this Agreement.
(x) All necessary corporate action has been duly and
validly taken by the Company to authorize the execution, delivery
and performance of this Agreement and the issuance and sale of the
Shares by the Company. This Agreement has been duly and validly
authorized, executed and delivered by the Company and constitutes
and will constitute the legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its
terms. Each approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or
other governmental body necessary in connection with the execution
and delivery by the Company of this Agreement and the issuance and
sale of the Shares by the Company (except such as may be required
under the Securities Act or such additional steps as may be
required by the National Association of Securities Dealers, Inc.
(the "NASD") or by the New York Stock Exchange, Inc. ("NYSE"), if
any) has been obtained or made and is in full force and effect. The
Shares will be listed on the NYSE on or prior to the Firm Share
Closing Date.
(y) Neither the Company nor its Subsidiaries is involved
in any labor dispute nor, to the knowledge of the Company, is any
such dispute threatened, which dispute would have a Material
Adverse Effect.
(z) The Company and its Subsidiaries are conducting their
respective businesses in compliance with all applicable laws, rules
and regulations of the jurisdictions in which they are conducting
business, including, without limitation, the Americans with
Disabilities Act of 1990 and all applicable local, state and
federal employment, truth-in-advertising, franchising and
immigration laws and regulations, except where the failure to be so
in compliance would not have a Material Adverse Effect.
(aa) No transaction has occurred between or among the
Company and any of its officers or trustees or any affiliate or
affiliates of any such officer or trustee that is required to be
described in and is not described in or incorporated by reference
in the Registration Statement and the Prospectus.
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(bb) The Company has not taken, nor will it take, directly
or indirectly, any action designed to or which might reasonably be
expected to cause or result in, or which has constituted or which
might reasonably be expected to constitute, the stabilization or
manipulation of the price of the Common Shares to facilitate the
sale or resale of any of the Shares.
(cc) The Company and its Subsidiaries have filed all
federal, state, local and foreign tax returns which are required to
be filed through the date hereof (and will file all such tax
returns when and as required to be filed after the date hereof), or
have received extensions thereof, and have paid all taxes shown on
such returns to be due on or prior to the date hereof (and will pay
all taxes shown on such returns to be due after the date hereof)
and all assessments received by it to the extent that the same are
material and have become due.
(dd) The execution, delivery and performance of each of
the Property Purchase Agreements (other than any letters of intent)
and the consummation of the transactions contemplated therein have
been duly authorized by all necessary action, and will not conflict
with or constitute a breach of, or a default under, or result in
the creation or imposition of any lien, charge or encumbrance under
any property or assets of the Company, nor will such action result
in a violation of the Company's charter, by-laws, or any applicable
law, administrative regulation or administrative or court decree.
(ee) The Company has met the qualification requirements
for a "real estate investment trust" during its taxable years
ending on or after December 31, 1997 and its proposed method of
operations will enable it to continue to meet the requirements for
qualification and taxation as a "real estate investment trust"
under the Internal Revenue Code of 1986, as amended (the "Code"),
assuming no change in the applicable underlying law. The Company
does not know of any event which would cause or is likely to cause
the Company to fail to qualify as a "real estate investment trust"
at any time.
(ff) The Company is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
(gg) The books, records and accounts of the Company and
its Subsidiaries accurately and fairly reflect, in reasonable
detail, the transactions in, and dispositions of, the assets of,
and the results of operations of, the Company and its Subsidiaries.
Each of the Company and its Subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with
management's general or specific authorizations, (ii) transactions
are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting
principles and to maintain asset accountability, (iii) access to
assets is permitted only in accordance with management's general or
specific authorization and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences.
(hh) The Company and its Subsidiaries are insured by
insurers of recognized financial responsibility against such losses
and risks and in such amounts as are customary in the businesses in
which they are engaged or propose to engage after giving effect to
the transactions described in the Prospectus; and neither the
Company nor any Subsidiary of the Company has any reason to believe
that it will not be able to renew its existing insurance coverage
as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business
at
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a cost that would not have a material adverse effect on the
business of the Company or its Subsidiaries. Neither the Company
nor any Subsidiary has been denied any insurance coverage which it
has sought or for which it has applied.
(ii) None of the Company, its Subsidiaries or any other
person associated with or acting on behalf of the Company or its
Subsidiaries including, without limitation, any trustee, director,
officer, agent or employee of the Company or its Subsidiaries has,
directly or indirectly, while acting on behalf of the Company or
its Subsidiaries (i) used any corporate funds for unlawful
contributions, gifts, entertainment or other unlawful expenses
relating to political activity; (ii) made any unlawful payment to
foreign or domestic government officials or employees or to foreign
or domestic political parties or campaigns from corporate funds;
(iii) violated any provision of the Foreign Corrupt Practices Act
of 1977, as amended; or (iv) made any other unlawful payment.
4. Conditions of the Underwriter's Obligations. The
obligation of the Underwriter to purchase the Shares is subject to each of the
following terms and conditions:
(a) The Prospectus Supplement shall have been timely filed
with the Commission in accordance with Section 5(a) of this
Agreement.
(b) No order preventing or suspending the use of the
Prospectus shall have been or shall be in effect and no order
suspending the effectiveness of the Registration Statement shall be
in effect and no proceedings for such purpose shall be pending
before or threatened by the Commission, and any requests for
additional information on the part of the Commission (to be
included in the Registration Statement or the Prospectus or
otherwise) shall have been complied with to the satisfaction of you
and your counsel.
(c) The representations and warranties of the Company
contained in this Agreement shall be true and correct when made and
on and as of each Closing Date as if made on such date and the
Company shall have performed all covenants and agreements and
satisfied all of the conditions contained in this Agreement
required to be performed or satisfied by it at or before such
Closing Date.
(d) The Underwriter shall have received on each Closing
Date a certificate, addressed to the Underwriter and dated such
Closing Date, of the chief executive officer or the chief financial
officer of the Company, to the effect that such person has
carefully examined the Registration Statement, the Prospectus and
this Agreement and that the representations and warranties of the
Company in this Agreement are true and correct on and as of such
Closing Date with the same effect as if made on such Closing Date
and the Company has performed all covenants and agreements and
satisfied all conditions contained in this Agreement required to be
performed or satisfied by it at or prior to such Closing Date.
(e) The Underwriters shall have received at the time this
Agreement is executed and on each Closing Date, a letter or letters
signed by Ernst & Young LLP, addressed to the Underwriter and
dated, respectively, the date of this Agreement and each such
Closing Date, in form and substance satisfactory to the
Underwriter, as to their status as independent accountants within
the meaning of the Securities Act and the Securities Rules, the
information in or incorporated by reference in the Registration
Statement in response to Item 10 of Form S-3 under the Securities
Act and matters
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relating to the financial statements and other financial and
statistical information included or incorporated by reference in
the Registration Statement and the Prospectus.
(f) The Underwriter shall have received on each Closing
Date from Xxxxxxxxx Xxxxxxxx LLP, counsel for the Company, an
opinion, addressed to the Underwriter and dated such Closing Date,
and stating in effect that:
(i) The Company has been duly organized and is
validly existing as a real estate investment trust in good
standing under the laws of the State of Maryland, and each
of the Subsidiaries has been duly organized and is validly
existing as a corporation in good standing under the laws
of the State of Missouri. To the best of such counsel's
knowledge, the Company has no other subsidiaries and does
not control, directly or indirectly, any corporation,
partnership, joint venture, association or other business
organization. Each of the Company and its Subsidiaries is
duly qualified and in good standing as a foreign
corporation in each jurisdiction in which the character or
location of its assets or properties (owned, leased or
licensed) or the nature of its businesses makes such
qualification necessary, except for such jurisdictions
where the failure to so qualify would not have a Material
Adverse Effect.
(ii) Each of the Company and its Subsidiaries has
all requisite corporate power and authority to own, lease
and license its assets and properties and conduct its
business as now being conducted and as described in the
Registration Statement, the Prospectus and the Prospectus
Supplement and with respect to the Company to enter into,
deliver and perform this Agreement and to issue and sell
the Shares.
(iii) The Company has authorized and issued
capital stock as set forth in the in the balance sheet of
the Company included in its Form 10-Q for the quarter
ended March 31, 1999; the certificates evidencing the
Shares are in due and proper legal form and have been duly
authorized for issuance by the Company; all of the
outstanding Common Shares of the Company have been duly
and validly authorized and issued and are fully paid and
nonassessable and none of them was issued in violation of
any preemptive or other similar right. The Shares when
issued and sold pursuant to this Agreement will be duly
and validly issued, outstanding, fully paid and
nonassessable and none of them will have been issued in
violation of any preemptive or other similar right. To the
best of such counsel's knowledge, except as disclosed in
the Registration Statement and the Prospectus, there are
no preemptive rights or any restriction upon the voting or
transfer of any securities of the Company pursuant to the
Company's charter or by-laws or other governing documents
or any other instrument to which the Company is a party or
by which it may be bound. To the best of such counsel's
knowledge, except as disclosed in the Registration
Statement and the Prospectus, there is no outstanding
option, warrant or other right calling for the issuance
of, and no commitment, plan or arrangement to issue, any
share of beneficial interest of the Company or any
security convertible into, exercisable for, or
exchangeable for shares of beneficial interest of the
Company. The Common Shares and the Shares conform in all
material respects to the descriptions thereof contained in
the Registration Statement and the Prospectus. The issued
and outstanding shares of capital stock of each of the
Company's Subsidiaries have been duly authorized and
validly issued, are fully paid and nonassessable and are
owned by the Company, free and clear, to the knowledge of
such counsel, of any liens, encumbrances, claims or
security interests.
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(iv) All necessary corporate action has been duly
and validly taken by the Company to authorize the
execution, delivery and performance of this Agreement and
the issuance and sale of the Shares. This Agreement has
been duly and validly authorized, executed and delivered
by the Company.
(v) Neither the execution, delivery and
performance of this Agreement by the Company nor the
consummation of any of the transactions contemplated
hereby (including, without limitation, the issuance and
sale by the Company of the Shares) will give rise to a
right to terminate or accelerate the due date of any
payment due under, or conflict with or result in the
breach of any term or provision of, or constitute a
default (or any event which with notice or lapse of time,
or both, would constitute a default) under, or require
consent or waiver under, or result in the execution or
imposition of any lien, charge or encumbrance upon any
properties or assets of the Company or the Subsidiaries
pursuant to the terms of any indenture, mortgage, deed of
trust, note or other agreement or instrument of which such
counsel is aware and to which the Company or the
Subsidiaries is a party or by which either the Company or
the Subsidiaries or any of their properties or businesses
is bound, or any franchise, license, permit, judgment,
decree, order, statute, rule or regulation of which such
counsel is aware or violate any provision of the charter
or by-laws of the Company or the Subsidiaries.
(vi) To the best of such counsel's knowledge, no
default exists, and no event has occurred which with
notice or lapse of time, or both, would constitute a
default, in the due performance and observance of any
term, covenant or condition by the Company of any
indenture, mortgage, deed of trust, note or any other
agreement or instrument to which the Company is a party or
by which it or any of its assets or properties or
businesses may be bound or affected, where the
consequences of such default would have a Material Adverse
Effect.
(vii) To the best of such counsel's knowledge, the
Company and its Subsidiaries are not in violation of any
term or provision of their respective charters or by-laws
or any franchise, license, permit, judgment, decree,
order, statute, rule or regulation, where the consequences
of such violation would have a Material Adverse Effect.
(viii) No consent, approval, authorization or
order of any court or governmental agency or regulatory
body is required for the execution, delivery or
performance of this Agreement by the Company or the
consummation of the transactions contemplated hereby or
thereby, except such as have been obtained under the
Securities Act and such as may be required under state
securities or "blue sky" laws in connection with the
purchase and distribution of the Shares by the
Underwriter.
(ix) To the best of such counsel's knowledge,
there is no litigation or governmental or other proceeding
or investigation, before any court or before or by any
public body or board pending or threatened against, or
involving the assets, properties or businesses of, the
Company which would have a Material Adverse Effect.
(x) The capital stock of the Company conforms in
all material respects to the description thereof contained
in the Prospectus Supplement under the caption
"Description
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of Common Shares." The statements in the Prospectus
Supplement under the caption "Description of Common
Shares" insofar as such statements constitute a summary of
documents referred to therein or matters of law, are fair
summaries in all material respects and accurately present
the information called for with respect to such documents
and matters. Accurate copies of all contracts and other
documents required to be filed as exhibits to, or
described in, the Registration Statement have been so
filed with the Commission or are fairly described in the
Registration Statement, as the case may be.
(xi) The descriptions contained or incorporated by
reference in the Registration Statement and the Prospectus
of statutes, legal and governmental proceedings, contracts
and other documents are accurate, and insofar as such
statements constitute a summary of documents referred to
therein, matters of law or legal conclusions, are fair
summaries of the material provisions thereof and
accurately present the information required with respect
to such documents and matters. All statutes, legal or
governmental proceedings, and all agreements and other
documents required to be described in the Registration
Statement (or incorporated by reference therein) have been
so described. All agreements and other documents known to
such counsel to be required to be filed as exhibits to the
Registration Statement have been so filed or incorporated
by reference therein.
(xii) The Registration Statement, the Prospectus,
the Prospectus Supplement, each of the documents
incorporated by reference in the Registration Statement
and the Prospectus and each amendment or supplement
thereto (except for the financial statements and notes and
schedules and other financial and statistical information
included therein, as to which such counsel expresses no
opinion) comply as to form in all material respects with
the requirements of the Securities Act and the Securities
Rules and the Exchange Act and the Exchange Rules, as the
case may be.
(xiii) The Registration Statement has become
effective under the Securities Act, and, to the best of
such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been
instituted or are threatened or pending. The Shares have
been listed on the NYSE.
(xiv) The Company has met the qualification
requirements for a "real estate investment trust" during
its taxable years ending on or after December 31, 1997 and
its proposed method of operation will enable it to
continue to meet the requirements for qualification and
taxation as a "real estate investment trust" under the
Code, assuming no change in the applicable underlying law.
The discussion in the Prospectus under the caption
"Federal Income Tax Consequences" is accurate and
complete.
(xv) The Company is not an "investment company"
within the meaning of the Investment Company Act of 1940,
as amended.
To the extent deemed advisable by such counsel, the
Underwriter may rely as to matters of fact on certificates of responsible
officers of the Company and public officials and on the opinions of other
counsel satisfactory to the Underwriter as to matters which are governed by laws
other than the laws of the States of New York, Maryland and Missouri and the
federal laws of the United States; provided that such counsel shall state that
in their opinion the Underwriter and such counsel are justified in relying on
such other opinions. Copies of such certificates and other opinions shall be
furnished to the Underwriter and counsel for the Underwriter.
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In addition, such counsel shall state that such counsel
has participated in conferences with
officers and other representatives of the Company, representatives of the
Underwriter and representatives of the independent certified public accountants
of the Company, at which conferences the contents of the Registration Statement
and the Prospectus and related matters were discussed and, although such counsel
is not passing upon and does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement and the Prospectus (except as specified in the foregoing opinion), on
the basis of the foregoing, no facts have come to the attention of such counsel
which lead such counsel to believe that the Registration Statement at the time
it became effective (except with respect to the financial statements and notes
and schedules thereto and other financial data, as to which such counsel need
express no belief) contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus (except with respect
to the financial statements, notes and schedules thereto and other financial
data, as to which such counsel need make no statement) on the date thereof and
on the applicable Closing Date contained any untrue statement of a material fact
or omitted to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
(g) All proceedings taken in connection with the sale of
the Firm Shares and the Option Shares as herein contemplated shall
be reasonably satisfactory in form and substance to the
Underwriter, and the Underwriter shall have received from Xxxxxx &
Xxxxx LLP a favorable opinion, addressed to the Underwriter and
dated such Closing Date, with respect to the Shares, the
Registration Statement and the Prospectus, and such other related
matters, as the Underwriter may reasonably request, and the Company
shall have furnished to Xxxxxx & Xxxxx LLP such documents as they
may reasonably request for the purpose of enabling them to pass
upon such matters.
(h) If the Shares have been qualified for sale in Florida,
the Underwriter shall have received on each Closing Date
certificates, addressed to the Underwriter, and dated such Closing
Date, of an executive officer of the Company, to the effect that
the signer of such certificate has reviewed and understands the
provisions of Section 517.075 of the Florida Statutes, and
represents that the Company has complied, and at all times will
comply, with all provisions of Section 517.075 and further, that as
of such Closing Date, neither the Company nor any of its affiliates
does business with the government of Cuba or with any person or
affiliate located in Cuba.
(i) The Shares shall have been listed on the NYSE.
(j) The NASD shall have passed on the terms of the
underwriter compensation in connection with the offering of the
Shares.
(j) The Company shall have furnished or caused to be
furnished to the Underwriter such further certificates or documents
as the Underwriter shall have reasonably requested.
5. Covenants of the Company. The Company covenants and
agrees as follows:
(a) The Company will cause the Prospectus Supplement to be
filed as required by Section 3(a) hereof (but only if the
Underwriter or its counsel has not reasonably objected thereto by
notice to the Company after having been furnished a copy a
reasonable time prior to filing) and will notify the Underwriter
promptly of such filing. During the period in which a Prospectus
relating to the Shares is required to be delivered under the
Securities Act or such date which is 90 days after the
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Closing Date, whichever is later, the Company will notify the
Underwriter promptly of the time when any subsequent amendment to
the Registration Statement has become effective or any subsequent
supplement to the Prospectus has been filed, of any request by the
Commission for any amendment or supplement to the Registration
Statement or Prospectus or for additional information; the Company
will prepare and file with the Commission, promptly upon the
request of the Underwriter, any amendments or supplements to the
Registration Statement or Prospectus that, in its or its counsel's
opinion, may be necessary or advisable in connection with the
distribution of the Shares; and the Company will file no amendment
or supplement to the Registration Statement or Prospectus (other
than any prospectus supplement relating to the offering of other
securities registered under the Registration Statement or any
document required to be filed under the Exchange Act that upon
filing is deemed to be incorporated by reference therein) to which
the Underwriter or its counsel shall reasonably object by notice to
the Company after having been furnished a copy a reasonable time
prior to the filing.
(b) The Company will advise the Underwriter, promptly
after it shall receive notice or obtain knowledge thereof, of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement, of the suspension of
the qualification or registration of the Shares for offering or
sale in any jurisdiction, or of the initiation or threatening of
any proceeding for any such purpose; and it will promptly use its
best efforts to prevent the issuance of any stop order or to obtain
its withdrawal if such a stop order should be issued.
(c) The Company will comply with all requirements imposed
upon it by the Securities Act, the Securities Rules, the Exchange
Act and the Exchange Rules as from time to time in force, so far as
necessary to permit the continuance of sales of, or dealings in,
the Shares as contemplated by the provisions hereof and the
Prospectus. If during such period where a prospectus relating to
the Shares is required to be delivered under the Securities Act or
such date which is 90 days after the Firm Shares Closing Date,
whichever is later, any event occurs as a result of which, in the
opinion of your counsel, the Registration Statement contains an
untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading or the Prospectus as then amended
or supplemented would include an untrue statement of a material
fact or omits to state a material fact necessary to make the
statements therein, in the light of the circumstances then
existing, not misleading, or if during such period it is necessary
to amend or supplement the Registration Statement or Prospectus to
comply with the Securities Act, the Company will promptly notify
you and will amend or supplement the Registration Statement or
Prospectus (at the expense of the Company) so as to correct such
statement or omission or effect such compliance.
(d) The Company shall make generally available to its
security holders and to the Underwriter as soon as practicable, but
not later than 45 days after the end of the 12-month period
beginning at the end of the fiscal quarter of the Company during
which the Effective Date occurs (or 90 days if such 12-month period
coincides with the Company's fiscal year), an earning statement
(which need not be audited) of the Company, covering such 12-month
period, which shall satisfy the provisions of Section 11(a) of the
Securities Act or Rule 158 of the Securities Rules.
(e) The Company shall furnish to the Underwriter and its
counsel, without charge, signed copies of the Registration
Statement (including all exhibits thereto and amendments thereof)
and all amendments thereof and, so long as delivery of a prospectus
by an Underwriter or dealer may
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be required by the Securities Act or the Securities Rules, as many
copies of the Prospectus and any amendments thereof and supplements
thereto as the Underwriter may reasonably request.
(f) For a period of five years after the date of this
Agreement, the Company shall supply to the Underwriter copies of
such financial statements and other periodic and special reports as
the Company may from time to time distribute generally to the
holders of any class of its capital stock and furnish to the
Underwriter a copy of each annual or other report it shall be
required to file with the Commission.
(g) Without the prior written consent of the Underwriter
for a period of 45 days after the date of this Agreement, the
Company shall not, directly or indirectly, issue, offer, sell or
register with the Commission, or otherwise encumber or dispose of,
directly or indirectly, any equity securities of the Company (or
any securities convertible into or exercisable or exchangeable for
equity securities of the Company or any rights to purchase or
acquire equity securities of the Company), except for (i) the
issuance of the Shares pursuant to the Registration Statement, (ii)
the issuance of Common Shares in exchange for properties to be
acquired by the Company from time to time, as described in the
Registration Statement filed by the Company with the Commission on
May 19, 1999 and (iii) the issuance of Common Shares pursuant to
(x) the exercise of outstanding employee and trustee options or the
grant or issuance of options under the Company's existing stock
option plans or (y) any Company dividend reinvestment or stock
purchase plan.
(h) On or before completion of the offering of the Shares,
the Company shall make all filings required under applicable
securities laws and by the NYSE (including any required
registration under the Exchange Act).
(i) The Company will continue to elect to qualify as a
"real estate investment trust" and will use its best efforts to
continue to meet the requirement to qualify as a "real estate
investment trust."
(j) The Company agrees to pay, or reimburse if paid by the
Underwriter, whether or not the transactions contemplated hereby
are consummated or this Agreement is terminated, all costs and
expenses incident to the offering of the Shares and the performance
of the obligations of the Company under this Agreement including
those relating to: (i) the preparation, printing, filing and
distribution of the Registration Statement including all exhibits
thereto, the Prospectus, all amendments and supplements to the
Registration Statement and the Prospectus, and the printing, filing
and distribution of this Agreement; (ii) the preparation and
delivery of certificates for the Shares to the Underwriter; (iii)
if applicable, the registration or qualification of the Shares for
offer and sale under the securities laws of the various
jurisdictions, including the reasonable fees and disbursements of
counsel for the Underwriter in connection with any such
registration and qualification; (iv) the furnishing (including cost
of shipping and mailing) to the Underwriter of copies of the
Prospectus and all amendments or supplements to the Prospectus, and
of the several documents required by this Section to be so
furnished, as may be reasonable requested for use in connection
with the offering and the sale of the Shares by the Underwriter or
by dealers to whom Shares may be sold; (v) the filing fees of the
NASD in connection with its review of the terms of the offering of
the Shares; (vi) the furnishing (including costs of shipping and
mailing) to the Underwriter of copies of all reports and
information required by Section 5(f); (vii) inclusion of the Shares
for quotation on the NYSE; and (viii) all transfer taxes, if any,
with respect to the sale and delivery of the Shares by the Company
to the Underwriter. Subject to the provisions of Section 8, the
Underwriter agrees to pay,
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whether or not the transactions contemplated hereby are consummated
or this Agreement is terminated, all costs and expenses incident to
the performance of the obligations of the Underwriter under this
Agreement not payable by the Company pursuant to the preceding
sentence, including, without limitation, the fees and disbursements
of counsel for the Underwriter.
(k) The Company shall file timely and accurate reports in
accordance with the provisions of Florida Statutes Section 517.05,
or any successor provision, and any regulation promulgated
thereunder, if at any time after the Effective Date, the Company or
any of its affiliates commences engaging in business with the
government of Cuba or any person or affiliate located in Cuba.
(l) The Company will apply the net proceeds from the
offering of the Shares in the manner set forth under "Use of
Proceeds" in the Prospectus.
6. Indemnification.
(a) The Company agrees to indemnify and hold harmless the
Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act against any and all losses, claims, damages
and liabilities, joint or several (including any reasonable
investigation, legal and other expenses incurred in connection
with, and any amount paid in settlement of, any action, suit or
proceeding or any claim asserted), to which they, or any of them,
may become subject under the Securities Act, the Exchange Act or
other federal or state law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities
arise out of or are based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement or the Prospectus or any amendment thereof or supplement
thereto, or arise out of or are based upon any omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading,
(ii) in whole or in part upon any breach of the representations and
warranties set forth in Section 3 hereof, or (iii) in whole or in
part upon any failure of the Company to perform any of its
obligations hereunder or under law; provided, however, that such
indemnity shall not inure to the benefit of the Underwriter (or any
person controlling the Underwriter) on account of any losses,
claims, damages or liabilities arising from the sale of the Shares
to any person by the Underwriter if such untrue statement or
omission or alleged untrue statement or omission was made in the
Registration Statement or the Prospectus, or such amendment or
supplement, in reliance upon and in conformity with information
furnished in writing to the Company by the Underwriter concerning
the Underwriter specifically for use therein. This indemnity
agreement will be in addition to any liability which the Company
may otherwise have.
(b) The Underwriter agrees to indemnify and hold harmless
the Company and each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act, each trustee of the Company, and each
officer of the Company who signs the Registration Statement, to the
same extent as the foregoing indemnity from the Company to the
Underwriter, but only insofar as such losses, claims, damages or
liabilities arise out of or are based upon any untrue statement or
omission or alleged untrue statement or omission which was made in
the Registration Statement or the Prospectus, or any amendment
thereof or supplement thereto, in reliance upon and in conformity
with information furnished in writing to the Company by the
Underwriter concerning the Underwriter specifically for use
therein; provided, however, that the
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obligation of the Underwriter to indemnify the Company (including
any controlling person, trustee or officer thereof) shall be
limited to the net proceeds received by the Company from the
Underwriter.
(c) Any party that proposes to assert the right to be
indemnified under this Section will, promptly after receipt of
notice of commencement of any action, suit or proceeding against
such party in respect of which a claim is to be made against an
indemnifying party or parties under this Section, notify each such
indemnifying party of the commencement of such action, suit or
proceeding, enclosing a copy of all papers served. No
indemnification provided for in Section 6(a) or 6(b) shall be
available to any party who shall fail to give notice as provided in
this Section 6(c) if the party to whom notice was not given was
unaware of the proceeding to which such notice would have related
and was prejudiced by the failure to give such notice but the
omission so to notify such indemnifying party of any such action,
suit or proceeding shall not relieve it from any liability that it
may have to any indemnified party for contribution or otherwise
than under this Section. In case any such action, suit or
proceeding shall be brought against any indemnified party and it
shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall be entitled to participate in, and, to
the extent that it shall wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof and the approval
by the indemnified party of such counsel, the indemnifying party
shall not be liable to such indemnified party for any legal or
other expenses, except as provided below and except for the
reasonable costs of investigation subsequently incurred by such
indemnified party in connection with the defense thereof. The
indemnified party shall have the right to employ its counsel in any
such action, but the fees and expenses of such counsel shall be at
the expense of such indemnified party unless (i) the employment of
counsel by such indemnified party has been authorized in writing by
the indemnifying parties, (ii) the indemnified party shall have
reasonably concluded that there may be a conflict of interest
between the indemnifying parties and the indemnified party in the
conduct of the defense of such action (in which case the
indemnifying parties shall not have the right to direct the defense
of such action on behalf of the indemnified party) or (iii) the
indemnifying parties shall not have employed counsel to assume the
defense of such action within a reasonable time after notice of the
commencement thereof, in each of which cases the fees and expenses
of counsel shall be at the expense of the indemnifying parties. An
indemnifying party shall not be liable for any settlement of any
action, suit, proceeding or claim effected without its written
consent, which consent shall not be unreasonably withheld or
delayed.
7. Contribution. In order to provide for just and
equitable contribution in circumstances in which the
indemnification provided for in Section 6(a) or 6(b) is due in
accordance with its terms but for any reason is held to be
unavailable to or insufficient to hold harmless an indemnified
party under Section 6(a) or 6(b), then each indemnifying party
shall contribute to the aggregate losses, claims, damages and
liabilities (including any investigation, legal and other expenses
reasonably incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims
asserted, but after deducting any contribution received by any
person entitled hereunder to contribution from any person who may
be liable for contribution) to which the indemnified party may be
subject in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the
Underwriter on the other from the offering of the Shares or, if
such allocation is not permitted by applicable law or
indemnification is not available as a result of the indemnifying
party not having received notice as provided in Section 6 hereof,
in such proportion as is appropriate to reflect not only the
relative benefits referred to above but also the relative fault of
the Company on the one hand and the Underwriter on the other in
connection with
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the statements or omissions which resulted in such losses, claims,
damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the
Company and the Underwriter shall be deemed to be in the same
proportion as (x) the total proceeds from the offering (net of
underwriting discounts but before deducting expenses) received by
the Company, as set forth on the cover page of the Prospectus, bear
to (y) the underwriting discounts received by the Underwriter, as
set forth on the cover page of the Prospectus. The relative fault
of the Company or the Underwriter shall be determined by reference
to, among other things, whether the untrue or alleged untrue
statement of a material fact related to information supplied by the
Company or the Underwriter and the parties' relative intent,
knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriter
agree that it would not be just and equitable if contribution
pursuant to this Section 7 were determined by pro rata allocation
or by any other method of allocation which does not take account of
the equitable considerations referred to above. Notwithstanding the
provisions of this Section 7, (i) in no case shall the Underwriter
be liable or responsible for any amount in excess of the
underwriting discount applicable to the Shares purchased by the
Underwriter hereunder; and (ii) the Company shall be liable and
responsible for any amount in excess of such underwriting discount;
provided, however, that 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. For
purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the Securities Act
or Section 20(a) of the Exchange Act shall have the same rights to
contribution as the Underwriter, and each person, if any, who
controls the Company within the meaning of the Section 15 of the
Securities Act or Section 20(a) of the Exchange Act, each officer
of the Company who shall have signed the Registration Statement and
each trustee of the Company shall have the same rights to
contribution as the Company, subject in each case to clauses (i)
and (ii) in the immediately preceding sentence of this Section 7.
Any party entitled to contribution will, promptly after receipt of
notice of commencement of any action, suit or proceeding against
such party in respect of which a claim for contribution may be made
against another party or parties under this Section, notify such
party or parties from whom contribution may be sought, but the
omission so to notify such party or parties from whom contribution
may be sought shall not relieve the party or parties from whom
contribution may be sought from any other obligation it or they may
have hereunder or otherwise than under this Section. No party shall
be liable for contribution with respect to any action, suit,
proceeding or claim settled without its written consent.
8. Termination. This Agreement may be terminated with
respect to the Shares to be purchased on a Closing Date by the Underwriter by
notifying the Company at any time.
(a) in the absolute discretion of the Underwriter at or
before any Closing Date: (i) if on or prior to such date, any
domestic or international event or act or occurrence has materially
disrupted, or in the opinion of the Underwriter will in the future
materially disrupt, the securities markets; (ii) if there has
occurred any new outbreak or material escalation of hostilities or
other calamity or crisis the effect of which on the financial
markets of the United States is such as to make it, in the judgment
of the Underwriter, inadvisable to proceed with the offering; (iii)
if there shall be such a material adverse change in general
financial, political or economic conditions or the effect of
international conditions on the financial markets in the United
States is such as to make it, in the judgment of the Underwriter,
inadvisable or impracticable to market the Shares; (iv) if trading
in the Shares has been suspended by the Commission or trading
generally on the NYSE, on the American Stock Exchange, Inc. or the
Nasdaq National Market has been suspended or limited, or minimum or
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maximum ranges for prices for securities shall have been fixed, or
maximum ranges for prices for securities have been required, by
said exchanges or by order of the Commission, the NASD, or any
other governmental or regulatory authority; or (v) if a banking
moratorium has been declared by any state or federal authority; or
(vi) if, in the judgment of the Underwriter, there has occurred a
Material Adverse Effect; or
(b) at or before any Closing Date, that any of the
conditions specified in Section 4 shall not have been fulfilled
when and as required by this Agreement.
If this Agreement is terminated pursuant to any of its
provisions, the Company shall not be under any liability to the Underwriter, and
the Underwriter shall not be under any liability to the Company, except that (i)
if this Agreement is terminated by the Underwriter because of any failure,
refusal or inability on the part of the Company to comply with the terms or to
fulfill any of the conditions of this Agreement, the Company will reimburse the
Underwriter for all out-of-pocket expenses (including the reasonable fees and
disbursements of their counsel) incurred by it in connection with the proposed
purchase and sale of the Shares or in contemplation of performing its
obligations hereunder and (ii) the Underwriter if it shall have failed or
refused to purchase the Shares agreed to be purchased by it under this
Agreement, without some reason sufficient hereunder to justify cancellation or
termination of its obligations under this Agreement, shall not be relieved of
liability to the Company for damages occasioned by its failure or refusal.
9. Miscellaneous. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officer and of the Underwriter set forth in or made pursuant to this
Agreement shall remain in full force and effect, regardless of any investigation
made by or on behalf of the Underwriter or the Company or any of the officers,
trustees, directors, or controlling persons referred to in Sections 6 and 7
hereof, and shall survive delivery of and payment for the Shares. The provisions
of Sections 5(j), 6, 7 and 8 shall survive the termination or cancellation of
this Agreement.
This Agreement has been and is made for the benefit of the
Underwriter and the Company and their respective successors and assigns, and, to
the extent expressed herein, for the benefit of persons controlling the
Underwriter, or the Company, and trustees and officers of the Company, and their
respective successors and assigns, and no other person shall acquire or have any
right under or by virtue of this Agreement. The term "successors and assigns"
shall not include any purchaser of Shares from the Underwriter merely because of
such purchase.
All notices and communications hereunder shall be in
writing and mailed or delivered or by telephone or telegraph if subsequently
confirmed in writing, (a) if to the Underwriter, c/o CIBC World Markets Corp.,
CIBC World Markets Tower, World Financial Center, New York, New York 10281
Attention: Xxxxxx X. Xxxxx, with a copy to Xxx X. Xxxxxxxxx, Esq., Xxxxxx &Wells
LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 and (b) if to the Company, to its
agent for service as such agent's address appears on the cover page of the
Registration Statement with a copy to Xxxx Xxxxx, Esq., Xxxxxxxxx Xxxxxxxx LLP,
0000 Xxxxx Xxxxxxxxx, Xxxxx 0000, Xxxxxx Xxxx, Xxxxxxxx 00000.
This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to principles
of conflict of laws.
This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
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Please confirm that the foregoing correctly sets forth the agreement among us.
Very truly yours,
ENTERTAINMENT PROPERTIES TRUST
By:/s/ Xxxxx X. Brain
-----------------------------
Title: Chief Operating Officer
Chief Financial Officer
Confirmed:
CIBC WORLD MARKETS CORP.
By:/s/ Xxxxxx Xxxxx
---------------------------
Title: Executive Director
