EXHIBIT (c)(3)
February 19, 1998
PaineWebber Incorporated
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
EastGroup-Meridian, Inc., a Missouri corporation (the "Purchaser"), and a
wholly-owned subsidiary of EastGroup Properties, Inc., a Maryland corporation
(the "Parent"), proposes to make an offer to purchase (together with any
extensions or amendments thereof or supplements thereto, the "Tender Offer") all
of the issued and outstanding common and preferred shares (collectively, the
"Securities") of Meridian Point Realty Trust VIII Company (the "Subject
Company"). The making of the Tender Offer, the purchase of Securities pursuant
thereto, and all related incidental acts and transactions are hereinafter
referred to collectively as the "Tender Offer Transactions." The following sets
forth the agreement (the "Agreement") between the Purchaser and the Parent and
PaineWebber Incorporated ("PaineWebber"):
1. Appointment as Dealer Manager. The Purchaser and the Parent hereby
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appoint PaineWebber on an exclusive basis to act as financial advisor with
respect to the Tender Offer Transactions and as sole dealer manager for the
Tender Offer, and hereby authorize PaineWebber to act as such in connection
therewith. PaineWebber agrees to perform those services as dealer manager with
respect to the Tender Offer as are customarily performed by PaineWebber in
connection with tender offers of a like nature and which the Purchaser and
Parent specifically request PaineWebber to perform, including (but not limited
to) using its best efforts to solicit tenders of Securities pursuant to the
Tender Offer and in communicating with other brokers, dealers, commercial banks
and trust companies (collectively, "Dealers"). In soliciting or obtaining
tenders, (i) PaineWebber, as dealer manager, shall not be deemed to be acting as
the agent of the Purchaser or the Parent other than pursuant to this Agreement
or as the agent of any Dealer and (ii) no Dealer shall be deemed to be acting as
the agent of PaineWebber. It is understood that PaineWebber is being engaged
hereunder solely to provide the services described above on behalf of the
Purchaser and the Parent, and that PaineWebber is not acting as an agent of the
equity holders of the Purchaser or the Parent, or as a fiduciary of the
Purchaser, the Parent or their respective equity holders, and that PaineWebber
shall have no duties or liability to the equityholders of the Purchaser or the
Parent or any other third party in connection with its engagement hereunder, all
of which are hereby expressly waived.
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2. Tender Offer Materials. As soon as practicable following the
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commencement of the Tender Offer, but in no event later than required by
applicable law, the Purchaser will file with the Securities and Exchange
Commission (the "Commission") a statement on Schedule 14D-1 with respect to the
Tender Offer and will promptly file as required any and all necessary amendments
and supplements to such statement on Schedule 14D-1. Such statement, as amended
from time to time, and the several exhibits thereto, are hereinafter referred to
as the "Schedule." The Schedule, the offer to purchase and letter of transmittal
contained therein, and all other statements and documents filed or to be filed
with any federal, state or local regulatory authority and all other documents
(including advertisements and other communications) that the Purchaser or the
Parent authorizes for use in connection with the solicitation of tenders for the
Securities, in each case as amended or supplemented from time to time, are
hereinafter referred to as the "Tender Offer Documents." The Purchaser and the
Parent agree to furnish PaineWebber, at their expense, with as many copies as
PaineWebber may request of the offer to purchase, the letter of transmittal, and
any other Tender Offer Document that PaineWebber may reasonably request. The
Purchaser and the Parent represent to PaineWebber that the Tender Offer
Documents are, and at all times during the Tender Offer (as from time to time
amended or supplemented), will comply as to form in all material respects with
all applicable rules and regulations, including, without limitation, the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules
and regulations thereunder, and that none of the Tender Offer Documents contains
or will 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, in light of the circumstances under which they were made, not
misleading, except that no representation is made with respect to any statements
contained in the Tender Offer Documents in reliance upon and in conformity with
information relating to PaineWebber furnished in writing by PaineWebber
expressly for use therein.
The Purchaser and the Parent agree that, a reasonable time prior to using
any material in connection with the Tender Offer or filing any such material
with the Commission or any other federal or state agency, commission or
instrumentality (collectively, "Other Agencies"), the Purchaser will submit
copies of such material to PaineWebber and will consult with PaineWebber and
give reasonable consideration to its comments, if any, with respect thereto.
3. Withdrawal. If the Purchaser or the Parent uses or permits the use of
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any material in connection with the Tender Offer or files any such material with
the Commission or Other Agencies (i) that has not been submitted to PaineWebber
for its comments, (ii) that has been so submitted and with respect to which
PaineWebber made comments to the Purchaser or the Parent but which comments have
not been reflected to PaineWebber's reasonable satisfaction, or (iii) if
Purchaser or Parent breach any of their respective representations, warranties
or covenants set forth herein, then PaineWebber shall be entitled to withdraw as
dealer manager in connection with the Tender Offer without any liability or
penalty or loss of rights on the part of PaineWebber or any other person or
entity defined in paragraph 6 hereof as an "Indemnified Person," and PaineWebber
shall remain entitled to receive the payment of all fees and expenses payable
under this Agreement that have accrued to the date of any such withdrawal.
4. Compensation. The Purchaser and the Parent will jointly and severally
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pay PaineWebber for services to be rendered by PaineWebber hereunder as set
forth in the
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compensation provisions of the Agreement dated February 19, 1998 between the
Parent and PaineWebber (the "Engagement Agreement"), which compensation
provisions are incorporated herein as if restated herein in full and shall
remain as a part of this Agreement notwithstanding any termination, amendment or
purported invalidity of the Engagement Agreement.
5. Expenses; Reimbursement Thereof. The Purchaser and/or the Parent will
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pay or cause to be paid (i) all fees and expenses relating to the preparation,
printing, filing, mailing and publishing of all documents pertaining to the
Tender Offer; (ii) all fees and expenses of any depositary, information agent or
other agents, attorneys and other persons retained by the Purchaser in
connection with the Tender Offer; (iii) all fees, if any, payable to Dealers
(including PaineWebber) as reimbursement for their customary mailing and
handling expenses in forwarding materials related to the Tender Offer to their
customers; (iv) all advertising charges; and (v) all other fees and expenses
incurred in connection with or relating to the Tender Offer. In addition, the
Purchaser and the Parent, jointly and severally, agree to reimburse PaineWebber
and its affiliates, promptly upon request, for all out-of-pocket expenses,
including (without limiting the foregoing) the fees, costs and expenses of
PaineWebber's legal counsel, incurred in connection with the Tender Offer
Transactions.
6. Limitation on Liability. Neither PaineWebber nor any affiliate
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thereof shall have any liability to the Purchaser or the Parent or any affiliate
thereof for any losses, claims, damages, liabilities or expenses ("Liabilities")
arising from any act or omission on the part of any Dealer, or from
PaineWebber's acts or omissions in performing its obligations hereunder or
otherwise in connection with the Tender Offer Transactions, except to the extent
that such Liabilities are finally judicially determined by a court of competent
jurisdiction to have resulted primarily from PaineWebber's willful misconduct or
gross negligence.
7. Indemnification and Contribution. The Purchaser and the Parent,
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jointly and severally, hereby agree (i) to indemnify and hold harmless
PaineWebber, its affiliated companies, and each of PaineWebber's and such
affiliated companies' respective officers, directors, agents, employees and
controlling persons (within the meaning of Section 20 of the Securities Exchange
Act of 1934 and Section 15 of the Securities Act of 1933) (each of the
foregoing, including PaineWebber, being hereafter sometimes called an
"Indemnified Person"), to the fullest extent permitted by law from and against
any and all Liabilities, actions (including shareholder derivative actions),
proceedings, investigations (whether formal or informal) or inquiries, or
threats thereof, based on or arising out of (1) any untrue statement or alleged
untrue statement of any material fact in any Tender Offer Document, (2) any
omission or alleged omission of any material fact required to be stated in any
Tender Offer Document or necessary to make the statements made in any Tender
Offer Document, in light of the circumstances under which they were made, not
misleading, (3) any withdrawal, termination or cancellation of any one or more
of the Tender Offer Transactions for any reason whatsoever, (4) any tender,
purchase or other acquisition by the Purchaser or the Parent or any affiliate
thereof of Securities (including, without limiting the foregoing, any purchase
prior to the date hereof as to which PaineWebber acted as broker or dealer), (5)
any violation by or conflict of the Tender Offer or any of the Tender Offer
Transactions of or with any law, rule, regulation, order, award, judgment,
determination, writ, injunction or decree of any United States federal, state,
local or foreign court or governmental authority, (6) any breach by the
Purchaser or the Parent of any
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representation or warranty or any failure to comply with any of the agreements
contained herein or any agreements relating to the Tender Offer or the Tender
Offer transactions, or (7) the Tender Offer, the Tender Offer Transactions or
PaineWebber's engagement hereunder, and (ii) in connection with the foregoing
obligations, to reimburse each Indemnified Person for all expenses (including
fees, disbursements and other charges of counsel) as they are incurred by such
Indemnified Person in connection with investigating, preparing to defend or
defending any such action (including actions brought by us or our equity holders
or derivative actions brought by any person claiming through us or in our name),
proceeding, investigation or inquiry, or threat thereof, whether or not any such
action, proceeding, investigation or inquiry is actually or formally commenced
or any such Indemnified Person is a party thereto or subject thereof.
Notwithstanding the foregoing, the Purchaser and the Parent shall not be
obligated to indemnify any such Indemnified Person under this Section 6 with
respect to any Liability, and amounts paid in reimbursement of expenses under
this Section 6 shall be refunded, to the extent, but only to the extent, that it
is finally judicially determined (i) that such Liability resulted primarily from
an untrue statement of any material fact in any Tender Offer Document or any
omission to state any material fact required to be stated in any Tender Offer
Document, or necessary to make the statements made therein, in light of the
circumstances under which they were made, not misleading, if, in any such case,
such statement or omission was made in such Tender Offer Document in reliance
upon and in conformity with written information prepared by PaineWebber and
furnished to the Purchaser or Parent in writing by PaineWebber or (ii) in the
case of Liabilities against which Indemnified Persons are indemnified solely
under clause (i)(7) of the preceding sentence, that such Liability resulted
primarily from the willful misconduct or gross negligence of such Indemnified
Person.
If any litigation, proceeding or investigation is instituted or threatened
against any Indemnified Person in respect of which indemnity may be sought
against the Purchaser pursuant to this Section 6, such Indemnified Person shall
promptly notify the Purchaser or Parent thereof, but the omission so to notify
the Purchaser or Parent shall not relieve the Purchaser or the Parent from any
obligation or liability under this Section 6, unless, and only to the extent
that, such omission so to notify results in the loss of substantive rights or
defenses. If any such litigation or proceeding shall be brought against any
Indemnified Person, the Purchaser and/or the Parent shall be entitled to
participate in such litigation or proceeding, and, after written notice from the
Purchaser or Parent to such Indemnified Person, to assume the defense of such
litigation or proceeding with counsel of the Purchaser's or Parent's choice at
its expense; provided, however, that such counsel shall be reasonably
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satisfactory to the Indemnified Person. Notwithstanding the election of the
Purchaser or the Parent to assume the defense of such litigation or proceeding,
such Indemnified Person shall have the right to employ separate counsel and to
control its own defense of such litigation or proceeding, and the Purchaser and
the Parent, jointly and severally, shall bear the fees and disbursements of such
separate counsel, if, in the reasonable opinion of counsel to such Indemnified
Person, (i) there may be legal defenses available to such Indemnified Person or
to other Indemnified Persons that are different from or additional to those
available to the Purchaser or the Parent or (ii) a conflict or potential
conflict otherwise exists between such Indemnified Person and the Purchaser or
the Parent that would make such separate representation advisable; provided,
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however, that the Purchaser and the Parent shall not under any circumstances be
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liable hereunder for the expenses of more than one firm of attorneys in any
jurisdiction in any one legal action or
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group of related legal actions. The Purchaser and the Parent agree that they
will not, without the prior written consent of PaineWebber, settle or compromise
or consent to the entry of any judgment in any pending or threatened claim,
action or proceeding relating to the Tender Offer Transactions or PaineWebber's
engagement hereunder (whether or not any Indemnified Person is a party thereto)
unless such settlement, compromise or consent includes an unconditional release
of PaineWebber and each other Indemnified Person from all liability arising or
that may arise out of such claim, action or proceeding.
If the indemnification provided for in this Section 6 is held by a court
of competent jurisdiction to be unavailable to any Indemnified Person in respect
of any Liabilities referred to herein (other than as a consequence of a final
judicial determination as set forth in the second sentence of the first
paragraph of this Section 6), then the Purchaser and the Parent in lieu of
indemnifying such Indemnified Person, shall, jointly and severally, contribute
to the amount paid or payable by such Indemnified Person as a result of such
Liabilities in such proportion as is appropriate to reflect the relative
benefits received by the Purchaser and the Parent on the one hand and by such
Indemnified Person on the other from the Tender Offer Transactions. If the
allocation provided in the preceding sentence is not permitted by applicable
law, or as a consequence of a final judicial determination as set forth in the
second sentence of the first paragraph of this Section 6, then the Purchaser and
the Parent agree to contribute to the amount paid or payable by such Indemnified
Person as a result of such Liabilities in such proportion as is appropriate to
reflect not only the relative benefits referred to in the preceding sentence,
but also the relative fault of the Purchaser and the Parent on the one hand and
of such Indemnified Person on the other in connection with the statements or
omissions or other actions relating to or in connection with the Tender Offer
Transactions or PaineWebber's engagement hereunder that resulted in such
Liabilities. Notwithstanding the foregoing, in no event shall the aggregate
amount contributed by the Indemnified Persons taking into account the
contribution of Purchaser and Parent as described above exceed the amount of
fees actually paid to PaineWebber by Purchaser and Parent pursuant to this
Agreement in connection with the Tender Offer Transactions. The relative
benefits received by the Purchaser and Parent on the one hand and PaineWebber on
the other shall be deemed to be in the same proportion as (i) the aggregate
purchase price paid or proposed to be paid for the maximum number of Securities
offered to be purchased pursuant to the Tender Offer bears to (ii) the fees paid
to PaineWebber pursuant to this Agreement. The relative fault of the Purchaser
and Parent on the one hand and of PaineWebber on the other shall be determined
by reference to, among other things, whether any untrue or alleged untrue
statement of, or any omission or alleged omission to state, a material fact
relates to information supplied by the Purchaser or the Parent or by PaineWebber
and by reference to the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The foregoing indemnification and contribution agreement shall be in addition to
any rights that any Indemnified Person may have at common law, by separate
agreement or otherwise.
7. Representations, Warranties and Covenants. The Purchaser and the
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Parent, jointly and severally, represent and warrant to, and covenant with,
PaineWebber that:
(i) each of the Purchaser and Parent is a corporation duly organized
and validly existing in good standing under the laws of the
jurisdiction of its incorporation;
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(ii) each of the Purchaser and Parent have taken all necessary corporate
action to authorize the Tender Offer;
(iii) this Agreement has been duly authorized, executed and delivered by,
and is a legal, valid and binding agreement of, each of the
Purchaser and Parent and is enforceable against the Purchaser and
Parent in accordance with its terms;
(iv) the Tender Offer Transactions, and the actions of Purchaser and
Parent with respect thereto, comply and will comply in all material
respects with all applicable requirements of law, including without
limitation all federal securities laws, the corporate laws of the
state in which the Subject Company is incorporated and any
applicable state takeover or "blue sky" laws;
(v) neither the Purchaser or Parent nor any of their affiliates has any
knowledge of any material fact or information concerning the
Subject Company that is required to be disclosed to the public as a
condition to the purchase of Securities and that has not been, or
is not being, or will not be, disclosed to the public through the
Tender Offer Documents or otherwise; and
(vi) neither the Purchaser nor Parent nor any affiliate thereof shall
publicly disclose or refer to any opinion or advice rendered by
PaineWebber to the Company without PaineWebber's prior written
consent.
8. Certain Events. The Purchaser will advise PaineWebber promptly of (i)
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the occurrence of any event which might reasonably cause the Purchaser to
withdraw, rescind or terminate the Tender Offer, or which might reasonably
permit the Purchaser to exercise any right not to purchase Securities tendered
pursuant to the Tender Offer or to consummate the transactions contemplated in
the Offer to Purchase, (ii) any material information relating to the Tender
Offer, including, without limitation, any proposal or requirement to make, amend
or supplement any filing required by the Exchange Act, (iii) the issuance of any
comment or order or the taking of any other action by the Commission or any
Other Agency concerning the Tender Offer, and (iv) any other information
relating to the Tender Offer or the transactions contemplated in the Offer to
Purchase which PaineWebber may from time to time reasonably request.
9. Securityholder Information. The Purchaser and the Parent will cause
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PaineWebber to be provided, to the extent the same is available to the Purchaser
and the Parent, with any cards or lists showing the names and addresses of, and
the number of Securities held by, the holders of Securities as of a recent date
and will endeavor to cause PaineWebber to be advised from day to day during the
period of the Tender Offer as to any transfers of record of the Securities known
to the Purchaser and the Parent.
The Purchaser and the Parent have appointed The Xxxxxx Trust Company of
New York to serve as Depositary in connection with the Tender Offer and have
instructed the Depositary to advise you daily as to such matters as you may
reasonably request.
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10. Miscellaneous. This Agreement shall be governed by and construed in
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accordance with the laws of the State of New York applicable to agreements made
and to be performed entirely in such state.
The Purchaser and the Parent, by their execution of this Agreement, each
hereby consents to the jurisdiction of the courts of, and consents to be sued in
any court in, the County of New York of the State of New York or in the United
States District Court for the Southern District of New York in any action or
proceeding brought by PaineWebber or any other Indemnified Person under this
Agreement. Service of process on the Purchaser or Parent may be effected by
mailing process, by registered mail, return receipt requested, to the Purchaser
or Parent at 300 Xxx Xxxxxxx Xxxxx, 000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxxxxx 00000-0000.
The Purchaser, the Parent and PaineWebber each hereby irrevocably waive
any right they may have to a trial by jury in respect of any claim based upon or
arising out of this Agreement or the transactions contemplated hereby.
The agreements contained in Sections 3, 5 and 6 and the representations
and warranties contained in Sections 2 and 7 shall remain operative and in full
force regardless of (i) any failure to commence, or the withdrawal, termination
or consummation of, the Tender Offer, (ii) any investigation made by or on
behalf of any Indemnified Person, (iii) any withdrawal by PaineWebber as dealer
manager for the Tender Offer pursuant to Section 2 or otherwise or (iv) any
termination of this Agreement.
Simultaneously with the execution and delivery of this Agreement, the
Purchaser and the Parent shall deliver to you the opinion of Xxxxxxx,
Xxxxxxxxxxx & Xxxxx, counsel for the Purchaser and the Parent, in the form
attached hereto as Exhibit A.
This Agreement shall be binding upon and inure to the benefit of the
parties hereto, and the respective successors and permitted assigns of each, and
shall inure to the benefit of the parties hereto and the other Indemnified
Persons, and the respective successors and permitted assigns of the foregoing.
If any provision of this Agreement shall be determined to be invalid or
unenforceable in any respect, such determination shall not affect such provision
in any other respect or any other provision of this Agreement, which shall
remain in full force and effect. This Agreement may not be amended or otherwise
modified or waived except by an instrument in writing signed by both
PaineWebber, the Purchaser and Parent.
This Agreement may be executed in counterparts, each of which shall be
deemed an original but all of which together shall be considered a single
instrument.
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The Engagement Agreement shall remain operative and in full force. Except
as set forth in the preceding sentence, this Agreement sets forth our entire
agreement with you with respect to the subject matter hereof, and supersedes any
prior agreements or understandings (whether written or oral) between us with
respect thereto.
Please confirm that the foregoing is in accordance with your understanding
by signing and returning to us the enclosed copy of this letter.
Very truly yours,
EASTGROUP-MERIDIAN, INC.
By
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Name:
Title:
EASTGROUP PROPERTIES, INC.
By
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Name:
Title:
Accepted and Agreed to as of
the date first written above:
PAINEWEBBER INCORPORATED
By:
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Title:
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