Exhibit 1.2
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[FORM OF UNDERWRITING AGREEMENT
FOR PREFERRED SHARES]
LASALLE HOTEL PROPERTIES
(a Maryland real estate investment trust)
% Series Cumulative Redeemable Preferred Shares
UNDERWRITING AGREEMENT
Dated:
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Table of Contents
Page
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SECTION 1. Representations and Warranties...................................2
(a) Representations and Warranties by the Company and
the Operating Partnership........................................2
(i) Compliance with Registration Requirements................3
(ii) Incorporated Documents...................................3
(iii) Independent Accountants..................................4
(iv) Financial Statements.....................................4
(v) No Material Adverse Change in Business...................4
(vi) Good Standing of the Company.............................5
(vii) Good Standing of the Operating Partnership...............5
(viii) Good Standing of Subsidiaries............................5
(ix) Capitalization...........................................5
(x) Authorization of Units and Preferred Units...............5
(xi) Authorization and Description of Securities..............6
(xii) Authorization of Agreement...............................6
(xiii) Absence of Defaults and Conflicts........................6
(xiv) Absence of Labor Dispute.................................7
(xv) Absence of Proceedings...................................7
(xvi) Accuracy of Exhibits.....................................7
(xvii) REIT Qualification.......................................7
(xviii) Investment Company Act...................................8
(xix) Possession of Intellectual Property......................8
(xx) Absence of Further Requirements..........................8
(xxi) Possession of Licenses and Permits.......................8
(xxii) Title to Property........................................9
(xxiii) Environmental Laws.......................................9
(b) Officer's Certificates..........................................10
SECTION 2. Sale and Delivery to Underwriters; Closing......................10
(a) Initial Securities..............................................10
(b) Option Securities...............................................10
(c) Payment.........................................................10
(d) Denominations; Registration.....................................11
SECTION 3. Covenants of the Company........................................11
(a) Compliance with Securities Regulations and
Commission Requests.............................................11
(b) Filing of Amendments............................................12
(c) Delivery of Registration Statements.............................12
(d) Delivery of Prospectuses........................................12
(e) Continued Compliance with Securities Laws.......................12
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(f) Blue Sky Qualifications.........................................13
(g) Rule 158........................................................13
(h) Reporting Requirements..........................................13
(i) Use of Proceeds.................................................13
(j) REIT Qualification..............................................13
(k) Listing.........................................................13
(l) No Manipulation of Market for Securities........................13
(m) Rule 462(b) Registration Statement..............................14
SECTION 4. Payment of Expenses.............................................14
(a) Expenses........................................................14
(b) Termination of Agreement........................................14
SECTION 5. Conditions of Underwriters' Obligations.........................14
(a) Effectiveness of Registration Statement.........................14
(b) Opinion of Counsel for Company..................................15
(c) Opinion of Counsel for Underwriters.............................15
(d) Officers' Certificate...........................................15
(e) Accountant's Comfort Letter.....................................15
(f) Bring-down Comfort Letter.......................................16
(g) Approval of Listing.............................................16
(h) Conditions to Purchase of Option Securities.....................16
(i) Officers' Certificate.....................................16
(ii) Opinion of Counsel for Company............................16
(iii) Opinion of Counsel for Underwriters.......................16
(iv) Bring-down Comfort Letter.................................16
(i) Additional Documents............................................16
(j) Termination of Agreement........................................17
SECTION 6. Indemnification.................................................17
(a) Indemnification of Underwriters.................................17
(b) Indemnification of Company, Trustees and Officers...............18
(c) Actions against Parties; Notification...........................18
SECTION 7. Contribution....................................................19
SECTION 8. Representations, Warranties and Agreements to Survive Delivery..20
SECTION 9. Termination of Agreement........................................20
(a) Termination; General............................................20
(b) Liabilities.....................................................21
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SECTION 10. Default by One or More of the Underwriters.....................21
SECTION 11. Notices........................................................22
SECTION 12. Parties........................................................22
SECTION 13. GOVERNING LAW AND TIME.........................................22
SECTION 14. Effect of Headings.............................................22
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LASALLE HOTEL PROPERTIES
(a Maryland real estate investment trust)
% Series Cumulative Redeemable Preferred Shares
(Par Value $.01 Per Share)
UNDERWRITING AGREEMENT
[DATE]
[CO-MANAGERS]
c/o [NAME]
[ADDRESS]
Ladies and Gentlemen:
LaSalle Hotel Properties, a Maryland real estate investment trust (the
"Company"), confirms its agreement with [CO-MANAGERS] (collectively, the
"Underwriters," which term shall also include any underwriter substituted as
hereinafter provided in Section 10 hereof), with respect to the issue and sale
by the Company and the purchase by the Underwriters, acting severally and not
jointly, of of the Company's % Series cumulative
redeemable preferred shares, par value $.01 per share, liquidation preference
$ per share (the "Series Preferred Shares"), and with respect to the grant
by the Company to the Underwriters, acting severally and not jointly, of the
option described in Section 2(b) hereof to purchase all or any part of
additional Series Preferred Shares to cover over-allotments, if any. The
aforesaid Series Preferred Shares (the "Initial Securities") to be purchased
by the Underwriters and all or any part of the .... Series Preferred Shares
subject to the option described in Section 2(b) hereof (the "Option
Securities") are hereinafter called, collectively, the "Securities."
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 33- , which also
constitutes a post-effective amendment to a previous registration statement
No. 333-77371) covering the registration of the Securities under the
Securities Act of 1933, as amended (the "1933 Act"), including the related
preliminary prospectus or prospectuses. Promptly after execution and delivery
of this Agreement, the Company will either (i) prepare and file a prospectus
in accordance with the provisions of paragraph (b) of Rule 424 ("Rule 424(b)")
of the rules and regulations of the Commission under the 1933 Act (the "1933
Act Regulations") or (ii) if the Company has elected to rely upon Rule 434
("Rule 434") of the 1933 Act Regulations, prepare and file a term sheet (a
"Term Sheet") in accordance with the provisions of Rule 434 and Rule 424(b).
The information included in any such prospectus or in any such Term Sheet, as
the case
may be, that was omitted from such registration statement at the time it
became effective but that is deemed to be part of such registration statement
pursuant to paragraph (d) of Rule 434 is referred to as "Rule 434
Information." Each prospectus used before such registration statement became
effective, and any prospectus that omitted the Rule 434 Information, that was
used after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "preliminary prospectus." Such registration
statement, including the exhibits thereto, schedules thereto, if any, and the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the 1933 Act, at the time it became effective and including the Rule 434
Information, as applicable, is herein called the "Registration Statement." Any
registration statement filed pursuant to Rule 462(b) of the 1933 Act
Regulations is herein referred to as the "Rule 462(b) Registration Statement,"
and after such filing the term "Registration Statement" shall include the Rule
462(b) Registration Statement. The final prospectus, including the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the
1933 Act, in the form first furnished to the Underwriters for use in
connection with the offering of the Securities is herein called the
"Prospectus." If Rule 434 is relied on, the term "Prospectus" shall refer to
the preliminary prospectus together with the Term Sheet and all references in
this Agreement to the date of the Prospectus shall mean the date of the Term
Sheet. For purposes of this Agreement, all references to the Registration
Statement, any preliminary prospectus, the Prospectus or any Term Sheet or any
amendment or supplement to any of the foregoing shall be deemed to include the
copy filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system ("XXXXX").
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of 1934, as amended (the "1934
Act"), which is incorporated by reference in the Registration Statement, such
preliminary prospectus or the Prospectus, as the case may be.
The term "Subsidiary" means a corporation or a partnership a majority of
the outstanding voting stock, partnership or membership interests, as the case
may be, of which is owned or controlled, directly or indirectly, by the
Company, LaSalle Hotel Operating Partnership, L.P., a Delaware limited
partnership (the "Operating Partnership"), or by one or more other
Subsidiaries of the Company or the Operating Partnership.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company and the Operating
Partnership. Each of the Company and the Operating Partnership represents and
warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with each Underwriter, as
follows:
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(i) Compliance with Registration Requirements. The Company meets the
requirements for use of Form S-3 under the 1933 Act. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto
(including the filing of the Company's most recent Annual Report on Form
10-K with the Commission) became effective, at the date of this Agreement
and at the Closing Time (and, if any Option Securities are purchased, at
the Date of Delivery), the Registration Statement, the Rule 462(b)
Registration Statement and any amendments and supplements thereto
complied and will comply in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations and did not and 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. Neither the Prospectus nor any
amendments or supplements thereto at the time the Prospectus or any such
amendment or supplement was issued and at the Closing Time (and, if any
Option Securities are purchased, at the Date of Delivery), included or
will include an untrue statement of a material fact or omitted or will
omit 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. If Rule 434 is used, the Company will comply with the
requirements of Rule 434. The representations and warranties in this
subsection shall not apply to statements in or omissions from the
Registration Statement or the Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by any
Underwriter through expressly for use in the Registration
Statement or Prospectus.
Each preliminary prospectus and the prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when
so filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriters
for use in connection with this offering was identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or deemed to
be incorporated by reference in the Registration Statement and the
Prospectus, when they became effective or at the time they were or
hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the Commission thereunder (the "1934 Act Regulations")
and, when read together with the other information in the Prospectus, at
the time the Registration Statement became effective, at the time the
Prospectus was issued and at the Closing Time (and, if any Option
Securities are purchased, at the Date of Delivery), did not and will not
contain an untrue statement of a material
3
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.
(iii) Independent Accountants. The accountants who certified the
financial statements and supporting schedules included in the
Registration Statement are independent public accountants as required by
the 1933 Act and the 1933 Act Regulations.
(iv) Financial Statements. The financial statements and the
consolidated statements of shareholders' equity included in the
Registration Statement and the Prospectus, together with the related
schedules and notes, present fairly the financial position of the Company
and its consolidated subsidiaries at the dates indicated and the
consolidated statements of operations and consolidated statements of cash
flows of the Company and its consolidated subsidiaries for the periods
specified; said financial statements have been prepared in conformity
with generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved. The supporting
schedules, if any, included in the Registration Statement and Prospectus
present fairly in accordance with GAAP the information required to be
stated therein. The selected historical operating and financial data
included in the Registration Statement and Prospectus present fairly the
information shown therein and have been compiled on a basis consistent
with the books and records of the Company and that of the audited
financial statements included in the Registration Statement and
Prospectus. In addition, any pro forma financial statements and the
related notes thereto included 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 bases 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.
(v) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Company, the
Operating Partnership and the Subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business (a "Material
Adverse Effect"), (B) there have been no transactions entered into by the
Company, the Operating Partnership or any Subsidiary, other than those in
the ordinary course of business, which are material with respect to the
Company, the Operating Partnership and the Subsidiaries considered as one
enterprise and (C) except for regular monthly dividends on the Company's
common shares of beneficial interest, par value $.01 per share (the
"Common Shares"), in amounts per share that are consistent with past
practice, regular quarterly distributions on the Company's preferred
shares, and regular monthly and quarterly distributions on the units (the
"Units") and the preferred units (the "Preferred Units"), respectively,
of the Operating Partnership, there has been no dividend or distribution
of any kind declared, paid or made by the Company on any class of its
capital shares or any distribution by the Operating Partnership with
respect to its Units and Preferred Units.
4
(vi) Good Standing of the Company. The Company is a real estate
investment trust duly formed and validly existing and in good standing
under the laws of the State of Maryland, with full trust power and
authority to own and lease its properties and to conduct its business as
described in the Prospectus and to enter into and perform its obligations
under this Agreement; and the Company is duly qualified or registered as
a foreign real estate investment trust and is in good standing in each
jurisdiction in which such qualification or registration is required,
whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect.
(vii) Good Standing of the Operating Partnership. The Operating
Partnership has been duly organized and is validly existing as a limited
partnership in good standing under the laws of the State of Delaware and
has the requisite power and authority to own, lease and operate its
properties and to conduct the business in which it is engaged as
described in the Operating Partnership Agreement (as defined below) and
the Prospectus and to enter into and perform its obligations under this
Agreement. The Operating Partnership is duly qualified or registered as a
foreign partnership and is in good standing in each jurisdiction in which
such qualification or registration is required, whether by reason of the
ownership or leasing of property or the conduct of business, except where
the failure to so qualify or register would not result in a Material
Adverse Effect. The Company is the sole general partner of the Operating
Partnership and holds such number and/or percentage of Units and
Preferred Units as disclosed in the Prospectus as of the dates set forth
therein. The Amended and Restated Agreement of Limited Partnership of the
Operating Partnership, dated as of April 29, 1998, as amended by the
First Amendment thereto, dated as of March 6, 2002 (the "Operating
Partnership Agreement"), is in full force and effect.
(viii) Good Standing of Subsidiaries. The Operating Partnership is
the only Subsidiary that is a "significant subsidiary" of the Company (as
such term is defined in Rule 1-02 of Regulation S-X). The only
Subsidiaries of the Company are (a) the Subsidiaries listed on Exhibit 21
to the Company's most recent Annual Report on Form 10-K and (b) certain
other Subsidiaries which, considered in the aggregate as a single
Subsidiary, do not constitute a "significant subsidiary" as defined in
Rule 1-02 of Regulation S-X.
(ix) Capitalization. If the Prospectus contains a "Capitalization"
section, the authorized, issued and outstanding capital shares of the
Company are as set forth in the column entitled "Actual" under such
section (except for subsequent issuances thereof, if any, contemplated
under this Agreement, pursuant to reservations, agreements or employee
benefit plans referred to in the Prospectus or pursuant to the exercise
of convertible securities or options referred to in the Prospectus). Such
capital shares have been duly authorized and validly issued by the
Company and are fully paid and non-assessable, and none of such capital
shares was issued in violation of preemptive or other similar rights of
any securityholder of the Company.
(x) Authorization of Units and Preferred Units. All issued and
outstanding Units and Preferred Units have been duly authorized and are
validly issued, fully paid
5
and non-assessable and have been offered and sold or exchanged by the
Operating Partnership in compliance with applicable laws.
(xi) Authorization and Description of Securities. The Securities to
be purchased by the Underwriters from the Company have been duly
authorized for issuance and sale to the Underwriters pursuant to this
Agreement and, when issued and delivered by the Company pursuant to this
Agreement against payment of the consideration set forth herein, will be
validly issued, fully paid and non-assessable. At or prior to the Closing
Time, the Company will have executed and filed Articles Supplementary
("Articles Supplementary") to the Company's Articles of Amendment and
Restatement of Declaration of Trust, dated as of April 24, 1998, as
amended and supplemented (the "Declaration of Trust"), establishing the
terms of the Securities with the State Department of Assessments and
Taxation of the State of Maryland. The Securities conform to all
statements relating thereto contained in the Prospectus and such
description conforms to the rights set forth in the Articles
Supplementary; the certificate evidencing the Securities will be in
substantially the form to be filed or incorporated by reference, as the
case may be, as an exhibit to the Registration Statement and the form of
share certificate evidencing the Securities will comply with all
applicable legal requirements, with all applicable requirements of the
Company's Declaration of Trust and Amended and Restated Bylaws (the
"Bylaws") and with the requirements of the New York Stock Exchange, Inc.
No holder of the Securities will be subject to personal liability by
reason of being such a holder; the issuance of the Securities is not
subject to the preemptive or other similar rights of any securityholder
of the Company.
(xii) Authorization of Agreement. This Agreement and the
transactions contemplated herein have been duly authorized by the Company
and the Operating Partnership and this Agreement has been duly executed
and delivered by the Company and the Operating Partnership.
(xiii) Absence of Defaults and Conflicts. None of the Company, the
Operating Partnership or any Subsidiary is in violation of its
declaration of trust, partnership agreement, charter, by-laws or other
governing instrument ("Governing Instruments") or in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other agreement or instrument to
which the Company, the Operating Partnership or any Subsidiary is a party
or by which it or any of them may be bound, or to which any of the
property or assets of the Company, the Operating Partnership or any
Subsidiary is subject (collectively, "Agreements and Instruments") except
for such violations or defaults of any Agreements or Instruments that
would not result in a Material Adverse Effect; and the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated herein and in the Prospectus (including the
issuance and sale of the Securities and the use of the proceeds from the
sale of the Securities as described in the Prospectus under the caption
"Use of Proceeds") and compliance by the Company and the Operating
Partnership with their respective obligations hereunder have been duly
authorized by all necessary action and do not and will not, whether with
or without the giving of notice or passage of time or both, conflict with
or constitute a breach of, or default or Repayment Event (as defined
6
below) under, or result in the creation or imposition of any lien, charge
or encumbrance upon any property or assets of the Company, the Operating
Partnership or any Subsidiary pursuant to, the Agreements and Instruments
(except for such conflicts, breaches, defaults or Repayment Events or
liens, charges or encumbrances that would not result in a Material
Adverse Effect), nor will such action result in any violation of the
provisions of the Governing Instruments of the Company, the Operating
Partnership or any Subsidiary or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over
the Company, the Operating Partnership or any Subsidiary or any of their
assets, properties or operations, except for such violations that would
not have a Material Adverse Effect. As used herein, a "Repayment Event"
means any event or condition which gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on such
holder's behalf) the right to require the repurchase, redemption or
repayment of all or a material portion of such indebtedness by the
Company, the Operating Partnership or any Subsidiary.
(xiv) Absence of Labor Dispute. No labor dispute with the employees
of the Company, the Operating Partnership or any Subsidiary exists or, to
the knowledge of the Company or the Operating Partnership, is imminent,
and the Company and the Operating Partnership are not aware of any
existing or imminent labor disturbance by the employees of any of its or
any Subsidiary's principal suppliers, manufacturers, customers or
contractors, which, in either case, may reasonably be expected to result
in a Material Adverse Effect.
(xv) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Company or the Operating Partnership, threatened, against or
affecting the Company, the Operating Partnership or any Subsidiary, which
is required to be disclosed in the Registration Statement (other than as
disclosed therein), or which might reasonably be expected to result in a
Material Adverse Effect or materially adversely affect the consummation
of the transactions contemplated in this Agreement or the performance by
the Company or the Operating Partnership of their respective obligations
hereunder. The aggregate of all pending legal or governmental proceedings
to which the Company, the Operating Partnership or any Subsidiary is a
party or of which any of their respective properties or assets is the
subject which are not described in the Prospectus, including ordinary
routine litigation could not reasonably be expected to result in a
Material Adverse Effect.
(xvi) Accuracy of Exhibits. There are no contracts or documents
which are required to be described in the Registration Statement, the
Prospectus or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and filed as
required.
(xvii) REIT Qualification. Commencing with its taxable year ended
December 31, 1998, the Company has been, and upon the sale of the
Securities, the Company will continue to be organized and operated in
conformity with the requirements for qualification and taxation as a real
estate investment trust (a "REIT") under the Internal
7
Revenue Code of 1986, as amended (the "Code"), and the Company's proposed
method of operation as described in the Prospectus will enable it to
continue to meet the requirements for qualification and taxation as a REIT
under the Code, and no actions have been taken (or not taken which are
required to be taken) which would cause such qualification to be lost.
(xviii) Investment Company Act. None of the Company, the Operating
Partnership and any Subsidiary is, and upon the issuance and sale of the
Securities as herein contemplated and the application of the net proceeds
therefrom as described in the Prospectus will be, an "investment company"
or an entity "controlled" by an "investment company" as such terms are
defined in the Investment Company Act of 1940, as amended (the "1940
Act").
(xix) Possession of Intellectual Property. The Company, the
Operating Partnership and any Subsidiary own or possess, or can acquire
on reasonable terms, adequate patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary
to carry on the business now operated by them, and neither the Company,
the Operating Partnership or any Subsidiary has received any written
notice or is otherwise aware of any infringement of or conflict with
asserted rights of others with respect to any Intellectual Property or of
any facts or circumstances which would render any Intellectual Property
invalid or inadequate to protect the interest of the Company, the
Operating Partnership or any Subsidiary therein, and which infringement
or conflict (if the subject of any unfavorable decision, ruling or
finding) or invalidity or inadequacy, singly or in the aggregate, would
result in a Material Adverse Effect.
(xx) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company or the
Operating Partnership of their respective obligations hereunder, in
connection with the offering, issuance or sale of the Securities
hereunder or the consummation of the transactions contemplated by this
Agreement, except such as has already been obtained or as required under
such securities laws or under the rules of the National Association of
Securities Dealers, Inc.
(xxi) Possession of Licenses and Permits. Each of the Company, the
Operating Partnership and the Subsidiaries possess such permits,
licenses, approvals, consents and other authorizations (collectively,
"Governmental Licenses") issued by the appropriate federal, state, local
or foreign regulatory agencies or bodies necessary to conduct the
business now operated by them except where failure to possess any such
Governmental Licenses would not result in a Material Adverse Event; the
Company, the Operating Partnership and their Subsidiaries are in
compliance with the terms and conditions of all such Governmental
Licenses, except where the failure so to comply would not, singly or in
the aggregate, result in a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect, except when
the invalidity of such Governmental
8
Licenses or the failure of such Governmental Licenses to be in full
force and effect would not result in a Material Adverse Effect; and none
of the Company, the Operating Partnership or any of the Subsidiaries has
received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would result in a Material Adverse Effect.
(xxii) Title to Property. The Company, the Operating Partnership,
the Subsidiaries or any joint ventures in which the Company, the
Operating Partnership or any Subsidiary owns an interest, as the case may
be, have good and marketable title to all real property owned, as
applicable, by the Company, the Operating Partnership, the Subsidiaries
or the applicable joint ventures, respectively, and good title to all
other properties owned by them, in each case, free and clear of all
mortgages, pledges, liens, security interests, claims, restrictions or
encumbrances of any kind, except (A) as otherwise stated in the
Prospectus or (B) those which do not, singly or in the aggregate,
materially affect the value of such property and do not interfere with
the use made and proposed to be made of such property by the Company, the
Operating Partnership, the Subsidiaries or the applicable joint ventures.
All of the leases and subleases material to the business of the Company,
the Operating Partnership and the Subsidiaries considered as one
enterprise, and under which the Company, the Operating Partnership or any
Subsidiary holds properties described in the Prospectus, are in full
force and effect, and none of the Company, the Operating Partnership or
any Subsidiary has received any notice of any material claim of any sort
that has been asserted by anyone adverse to the rights of the Company,
the Operating Partnership or any Subsidiary under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the
Company, the Operating Partnership or any Subsidiary of the continued
possession of the leased or subleased premises under any such lease or
sublease.
(xxiii) Environmental Laws. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, result in
a Material Adverse Effect, to the knowledge of the Company, the Operating
Partnership and any Subsidiary, as the case may be (A) none of the
Company, the Operating Partnership or any of the Subsidiaries is in
violation of any federal, state or local statute, law, rule, regulation,
ordinance, code, policy or rule of common law or any judicial or
administrative interpretation thereof, including any judicial or
administrative order, consent, decree or judgment, relating to pollution
or protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, "Hazardous Materials") or
to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (B) the Company, the Operating Partnership and the
Subsidiaries have all permits, authorizations and approvals required
under any applicable Environmental Laws and are each in compliance with
their requirements, (C) there are no pending or threatened
administrative, regulatory or judicial actions, suits, demands,
9
demand letters, claims, liens, notices of noncompliance or violations,
investigations or proceedings relating to any Environmental Law against
the Company, the Operating Partnership or any of the Subsidiaries and (D)
there are no events or circumstances that might reasonably be expected to
form the basis of an order for clean-up or remediation, or an action,
suit or proceeding by any private party or governmental body or agency,
against or affecting the Company, the Operating Partnership or any of the
Subsidiaries relating to Hazardous Materials or any Environmental Laws.
(b) Officer's Certificates. Any certificate signed by any officer of the
Company, or any authorized representative of the Operating Partnership or any
of their subsidiaries delivered to the Underwriters or to counsel for the
Underwriters shall be deemed a representation and warranty by such person or
entity, as the case may be, to each Underwriter as to the matters covered
thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to each Underwriter, severally and not
jointly, and each Underwriter, severally and not jointly, agrees to purchase
from the Company, at the price per share set forth in Schedule B, the number
of Initial Securities set forth in Schedule A opposite the name of such
Underwriter, plus any additional number of Initial Securities which such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the Underwriters, severally
and not jointly, to purchase up to an additional Series Preferred
Shares in the aggregate at the price per share set forth in Schedule B, less
an amount per share equal to any dividends or distributions declared by the
Company and payable on the Initial Securities but not payable on the Option
Securities. The option hereby granted will expire 30 days after the date
hereof and may be exercised in whole or in part from time to time only for the
purpose of covering over-allotments which may be made in connection with the
offering and distribution of the Initial Securities upon notice by the
Underwriters to the Company setting forth the number of Option Securities as
to which the several Underwriters are then exercising the option and the time
and date of payment and delivery for such Option Securities. Any such time and
date of delivery (a "Date of Delivery") shall be determined by the
Underwriters, but shall not be later than seven full business days after the
exercise of said option, nor in any event prior to the Closing Time, as
hereinafter defined. If the option is exercised as to all or any portion of
the Option Securities, each of the Underwriters, severally and not jointly,
will purchase that proportion of the total number of Option Securities then
being purchased which the number of Initial Securities each such Underwriter
has severally agreed to purchase as set forth in Schedule A bears to the total
number of Initial Securities, subject to such adjustments as in
its discretion shall make to eliminate any sales or purchases of a fractional
number of Option Securities.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of ,
or at such other place as shall be agreed
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upon by the Underwriters and the Company, at 10:00 A.M. (Eastern time) on the
third (fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any
given day) business day after the date hereof (unless postponed in accordance
with the provisions of Section 10), or such other time not later than ten
business days after such date as shall be agreed upon by the Underwriters and
the Company (such time and date of payment and delivery being herein called
"Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by the
Underwriters and the Company, on each Date of Delivery as specified in the
notice from the Underwriters to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery
to the Underwriters for the respective accounts of the Underwriters of
certificates for the Securities to be purchased by them. It is understood that
each Underwriter has authorized the Underwriters, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Initial Securities and the Option Securities, if any, which it has agreed to
purchase , individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Initial Securities or the Option Securities, if any, to be
purchased by any Underwriter whose funds have not been received by the Closing
Time or the relevant Date of Delivery, as the case may be, but such payment
shall not relieve such Underwriter from its obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial Securities
and the Option Securities, if any, shall be in such denominations and
registered in such names as the Underwriters may request in writing at least
one full business day before the Closing Time or the relevant Date of
Delivery, as the case may be. The certificates for the Initial Securities and
the Option Securities, if any, will be made available for examination and
packaging by the Underwriters in The City of New York not later than 10:00
A.M. (Eastern time) on the business day prior to the Closing Time or the
relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. Each of the Company and the
Operating Partnership covenants with each Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rule
434 and will notify the Underwriters immediately, and confirm the notice in
writing, (i) when any post-effective amendment to the Registration Statement
shall become effective, or any supplement to the Prospectus or any amended
Prospectus shall have been filed, (ii) of the receipt of any comments from the
Commission, (iii) of any request by the Commission for any amendment to the
Registration Statement or any amendment or supplement to the Prospectus or for
additional information, and (iv) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or of any
order preventing or suspending the use of any preliminary prospectus, or of
the suspension of the qualification of the Securities for offering or sale in
any jurisdiction, or of the initiation or threatening of any proceedings for
any of such purposes. The Company will promptly effect the filings necessary
pursuant to Rule 424(b) and
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will take such steps as it deems necessary to ascertain promptly whether the
form of prospectus transmitted for filing under Rule 424(b) was received for
filing by the Commission and, in the event that it was not, it will promptly
file such prospectus. The Company will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) Filing of Amendments. During the period a Prospectus is required to
be delivered under the 1933 Act, the Company will give the Underwriters notice
of its intention to file or prepare any amendment to the Registration
Statement (including any filing under Rule 462(b)), any Term Sheet or any
amendment, supplement or revision to either the prospectus included in the
Registration Statement at the time it became effective or to the Prospectus,
whether pursuant to the 1933 Act, the 1934 Act or otherwise, will furnish the
Underwriters with copies of any such documents a reasonable amount of time
prior to such proposed filing or use, as the case may be, and will not file or
use any such document to which the Underwriters or counsel for the
Underwriters shall reasonably object.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to and counsel for the Underwriters, without charge, one signed
copy of the Registration Statement as originally filed and of each amendment
thereto (including conformed copies of exhibits filed therewith or
incorporated by reference therein and documents incorporated or deemed to be
incorporated by reference therein) and signed copies of all consents and
certificates of experts, and will also deliver to , without
charge, a conformed copy of the Registration Statement as originally filed and
of each amendment thereto (without exhibits) for each of the Underwriters. The
copies of the Registration Statement and each amendment thereto furnished to
the Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
such number of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any amendments or
supplements thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant
to XXXXX, except to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934
Act Regulations so as to permit the completion of the distribution of the
Securities as contemplated in this Agreement and in the Prospectus. If at any
time when a prospectus is required by the 1933 Act to be delivered in
connection with sales of the Securities, any event shall occur or condition
shall exist as a result of which it is necessary, in the
12
opinion of counsel for the Underwriters or for the Company, to amend the
Registration Statement or amend or supplement the Prospectus in order that the
Prospectus will not include any untrue statements of a material fact or omit
to state a material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or amend or
supplement the Prospectus in order to comply with the requirements of the 1933
Act or the 1933 Act Regulations, the Company will promptly prepare and file
with the Commission, subject to Section 3(b), such amendment or supplement as
may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements, and
the Company will furnish to the Underwriters such number of copies of such
amendment or supplement as the Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Securities for offering and
sale under the applicable securities laws of such states and other
jurisdictions as the Underwriters may designate and to maintain such
qualifications in effect for a period of not less than one year from the date
of this Agreement; provided, however, that the Company shall not be obligated
to file any general consent to service of process or to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which it is
not so qualified or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the date of this Agreement.
(g) Rule 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) Reporting Requirements. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to be filed with the Commission pursuant to
the 1934 Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
(i) Use of Proceeds. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus
under "Use of Proceeds."
(j) REIT Qualification. The Company will use its best efforts to continue
to meet the requirement to qualify as a REIT under the Code for each of its
taxable years for so long as the board of trustees deems it in the best
interests of the Company's shareholders to remain so qualified.
(k) Listing. The Company will use its best efforts to effect the listing
of the Securities on the New York Stock Exchange, Inc.
(l) No Manipulation of Market for Securities. Except for the
authorization of actions permitted to be taken by the Underwriters as
contemplated herein or in the Prospectus, neither the Company nor the
Operating Partnership will (a) take, directly or indirectly, any action
designed to cause or to result in, or that might reasonably be expected to
constitute, the stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of the Securities, and (b) until
the Closing Date, or the Date of Delivery, if any, (i) sell, bid
13
for or purchase the Securities or pay any person any compensation for
soliciting purchases of the Securities or (ii) pay or agree to pay to any
person any compensation for soliciting another to purchase any other
securities of the Company.
(m) Rule 462(b) Registration Statement. If the Company elects to rely
upon Rule 462(b), the Company shall file a Rule 462(b) Registration Statement
with the Commission in compliance with Rule 462(b) by 10:00 P.M., Washington,
D.C. time, on the date of this Agreement, and the Company shall at the time of
filing either pay to the Commission the filing fee for the Rule 462(b)
Registration Statement or give irrevocable instructions for the payment of
such fee pursuant to Rule 111(b) under the 1933 Act.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company and the Operating Partnership will pay or cause
to be paid all expenses incident to the performance of their obligations under
this Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation
(exclusive of fees and disbursements of counsel for the Underwriters),
printing and delivery to the Underwriters of this Agreement, (iii) the
preparation, issuance and delivery of the certificates for the Securities to
the Underwriters, including any stock or other transfer taxes and any stamp or
other duties payable upon the sale, issuance or delivery of the Securities to
the Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(f) hereof, (vi)
the printing and delivery to the Underwriters of copies of each of the
preliminary prospectus, Prospectus and any amendments or supplements thereto,
(vii) the fees and expenses of any transfer agent or registrar for the
Securities and (viii) the fees and expenses incurred in connection with the
listing of the Securities on the New York Stock Exchange, Inc.
(b) Termination of Agreement. If this Agreement is terminated by the
Underwriters in accordance with the provisions of Section 5 or Section 9(a)(i)
or (iii) (with respect to the first clause only), the Company shall reimburse
the Underwriters for all of their out-of-pocket expenses, including the
reasonable fees and disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of
the several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Operating Partnership
contained in Section 1 hereof or in certificates of any officer or authorized
representative of the Company or the Operating Partnership delivered pursuant
to the provisions hereof, to the performance by the Company or the Operating
Partnership of its covenants and other obligations hereunder, and to the
following further conditions:
(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
14
reasonable satisfaction of counsel to the Underwriters. A prospectus shall
have been filed with the Commission in accordance with Rule 424(b) or, if the
Company has elected to rely upon Rule 434, a Term Sheet shall have been filed
with the Commission in accordance with Rule 424(b).
(b) Opinion of Counsel for Company. At Closing Time, the Underwriters
shall have received the favorable opinion, dated as of Closing Time, of Sidley
Xxxxxx Xxxxx & Xxxx LLP, counsel for the Company and the Operating Partnership
to the effect set forth in Exhibit A hereto and to such further effect as
counsel to the Underwriters may reasonably request.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Underwriters shall have received the favorable opinion of ,
counsel for the Underwriters, dated the Closing Date, with respect to the
incorporation of the Company, the validity of the Securities, the Registration
Statement and the Prospectus, as amended or supplemented, and such other
related matters as the Underwriters may require, and the Company shall have
furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters. Such counsel may state that, insofar
as such opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company, the Operating
Partnership and the Subsidiaries and certificates of public officials.
(d) Officers' Certificate. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company, the Operating Partnership, and the Subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of
business, and the Underwriters shall have received a certificate of the
President or an Executive Vice President of the Company, on behalf of the
Company and as general partner of the Operating Partnership, and of the chief
financial or chief accounting officer of the Company, on behalf of the Company
and as general partner of the Operating Partnership, dated as of Closing Time,
to the effect that (i) there has been no such material adverse change, (ii)
the representations and warranties in Section 1(a) hereof are true and correct
with the same force and effect as though expressly made at and as of Closing
Time, (iii) each of the Company and the Operating Partnership has complied
with all agreements and satisfied all conditions on its part to be performed
or satisfied at or prior to Closing Time, and (iv) no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are pending or are
contemplated by the Commission. In addition, at Closing Time, the Underwriters
shall have received a certificate of the chief executive officer and chief
financial officer of the Company, on behalf of the Company and as general
partner of the Operating Partnership, to the effect as counsel to the
Underwriters may reasonably request.
(e) Accountant's Comfort Letter. At the time of execution of this
Agreement, the Underwriters shall have received from KPMG LLP a letter dated
such date, in form and substance satisfactory to the Underwriters, containing
statements and information of the type ordinarily included in accountants'
"comfort letters" to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement and the
Prospectus.
15
(f) Bring-down Comfort Letter. At Closing Time, the Underwriters shall
have received from KPMG LLP a letter, dated as of Closing Time, to the effect
that they reaffirm statements made in the letter furnished pursuant to
subsection (e) of this Section 5, except that the "specified date" referred to
shall be a date not more than three days prior to the Closing Time.
(g) Approval of Listing. At Closing Time, the Securities shall have been
approved for listing on the New York Stock Exchange, Inc., subject only to
official notice of issuance.
(h) Conditions to Purchase of Option Securities. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to purchase
all or any portion of the Option Securities, the representations and
warranties of the Company and the Operating Partnership contained herein and
the statements in any certificates furnished by the Company, the Operating
Partnership and any Subsidiary shall be true and correct as of each Date of
Delivery and, at the relevant Date of Delivery, the Underwriters shall have
received:
(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the President or an Executive Vice President of the Company,
and of the chief financial or chief accounting officer of the Company,
confirming that the certificate delivered at the Closing Time pursuant to
Section 5(d) hereof remains true and correct as of such Date of Delivery.
(ii) Opinion of Counsel for Company. The favorable opinion of Sidley
Xxxxxx Xxxxx & Xxxx LLP, counsel for the Company and the Operating
Partnership, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery to the same effect as
the opinion required by Section 5(b) hereof.
(iii) Opinion of Counsel for Underwriters. The favorable opinion of
, counsel for the Underwriters, dated such Date of Delivery, relating to
the Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by Section 5(c)
hereof.
(iv) Bring-down Comfort Letter. Letter from KPMG LLP, in form and
substance satisfactory to the Underwriters and dated such Date of
Delivery, substantially in the same form and substance as the letter
furnished to the Underwriters pursuant to Section 5(f) hereof, except
that the "specified date" in each letter furnished pursuant to this
paragraph shall be a date not more than three days prior to such Date of
Delivery.
(i) Additional Documents. At Closing Time and at each Date of Delivery
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may reasonably require for the purpose of enabling them to
pass upon the issuance and sale of the Securities as herein contemplated, or
in order to evidence the accuracy of any of the representations or warranties,
or the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company in connection with the issuance and sale of
the Securities as herein contemplated shall be reasonably satisfactory in form
and substance to the Underwriters and counsel for the Underwriters.
16
(j) Termination of Agreement. If any condition specified in this Section
5 shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option
Securities on a Date of Delivery which is after the Closing Time, the
obligations of the several Underwriters to purchase the relevant Option
Securities, may be terminated by the Underwriters by notice to the Company at
any time at or prior to Closing Time or such Date of Delivery, as the case may
be, and such termination shall be without liability of any party to any other
party except as provided in Section 4 and except that Sections 1, 6, 7, 8 and
13 shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. Each of the Company and the
Operating Partnership agrees, jointly and severally, to indemnify and hold
harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act, and any director, officer, employee or affiliate thereof as
follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 434 Information,
if applicable, or the omission or alleged omission therefrom of a
material fact required to be stated therein or necessary to make the
statements therein not misleading or arising out of any untrue statement
or alleged untrue statement of a material fact included in any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. The
foregoing indemnity agreement with respect to any preliminary prospectus
shall not inure to the benefit of any Underwriter who failed to deliver a
Prospectus (as then amended or supplemented, provided by the Company to
the several Underwriters in accordance with Section 3(d)) to the person
asserting any losses, claims, damages and liabilities and judgments
caused by any untrue statement or alleged untrue statement of a material
fact contained in any preliminary prospectus, or caused by 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, if such material misstatement or omission or alleged material
misstatement or omission was cured, as determined by a court of competent
jurisdiction in a decision not subject to further appeal, in such
Prospectus and such Prospectus was required by law to be delivered at or
prior to the written confirmation of sale to such person.
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided any such settlement is
effected with the written consent of the Company; and
17
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by ),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement
or omission, to the extent that any such expense is not paid under (i) or
(ii) above;
provided, however, that this indemnity agreement shall not apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 434 Information, if
applicable, or any preliminary prospectus or the Prospectus (or any amendment
or supplement thereto).
(b) Indemnification of Company, Trustees and Officers. Each Underwriter
severally agrees to indemnify and hold harmless the Company and the Operating
Partnership, each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act, and any officer,
director, trustee, employee or affiliate thereof, against any and all loss,
liability, claim, damage and expense described in the indemnity contained in
subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in
the Registration Statement (or any amendment thereto), including the Rule 434
Information, if applicable, or any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity
with written information furnished to the Company by such Underwriter through
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party
of any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve
such indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve
it from any liability which it may have otherwise than on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section
6(a) above, counsel to the indemnified parties shall be selected by ,
and, in the case of parties indemnified pursuant to Section 6(b) above,
counsel to the indemnified parties shall be selected by the Company. An
indemnifying party may participate at its own expense in the defense of any
such action; provided, however, that counsel to the indemnifying party shall
not (except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever
in respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the
18
indemnified parties are actual or potential parties thereto), unless (x) such
settlement, compromise or consent (i) includes an unconditional release of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act by or on behalf of
any indemnified party and (y) the indemnifying party confirms in writing its
indemnification obligations hereunder with respect to such settlement,
compromise or judgment.
SECTION 7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Operating Partnership on the one hand and the Underwriters on the other hand
from the offering of the Securities pursuant to this Agreement or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
the Operating Partnership on the one hand and of the Underwriters on the other
hand in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The relative benefits received by the Company and the Operating
Partnership on the one hand and the Underwriters on the other hand in
connection with the offering of the Securities pursuant to this Agreement
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of the Securities pursuant to this Agreement
(before deducting expenses) received by the Company and the total underwriting
discount received by the Underwriters, in each case as set forth on the cover
of the Prospectus, or, if Rule 434 is used, the corresponding location on the
Term Sheet bear to the aggregate initial public offering price of the
Securities as set forth on such cover.
The relative fault of the Company and the Operating Partnership on the
one hand and the Underwriters on the other hand shall be determined by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or the Operating
Partnership or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company, the Operating Partnership and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7
were determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation which
does not take account of the equitable considerations referred to above in
this Section 7. The aggregate amount of losses, liabilities, claims, damages
and expenses incurred by an indemnified party and referred to above in this
Section 7 shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon
any such untrue or alleged untrue statement or omission or alleged omission.
19
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) 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 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter,
and each trustee of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
shall have the same rights to contribution as the Company, subject in each
case to the preceding two paragraphs. The Underwriters' respective obligations
to contribute pursuant to this Section 7 are several in proportion to the
number of Initial Securities set forth opposite their respective names in
Schedule A hereto and not joint. For purposes of this Section 7, the Company
and the Operating Partnership shall be deemed one party, jointly and severally
liable for any obligations hereunder.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or the Operating
Partnership submitted pursuant hereto, shall remain operative and in full
force and effect, regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the Company or the
Operating Partnership, and shall survive delivery of the Securities to the
Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Underwriters may terminate this Agreement,
by notice to the Company, at any time at or prior to Closing Time (i) if there
has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company, the Operating
Partnership and any of the Subsidiaries considered as one enterprise, whether
or not arising in the ordinary course of business, or (ii) if there has
occurred any material adverse change in the financial markets in the United
States, any outbreak of hostilities or escalation thereof, any acts of
terrorism involving the United States or other calamity or crisis or any
change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Underwriters,
impracticable to market the Securities or inadvisable to enforce contracts for
the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the New
York Stock Exchange, Inc., or if trading generally on the American Stock
Exchange or the New York Stock Exchange, Inc. or in the Nasdaq National Market
has been suspended or materially limited, or minimum or maximum
20
prices for trading have been fixed, or maximum ranges for prices have been
required, by any of said exchanges or by such system or by order of the
Commission, the National Association of Securities Dealers, Inc. or any other
governmental authority, or a material disruption has occurred in commercial
banking or securities settlement or clearance services in the United States,
or (iv) if a banking moratorium has been declared by either Federal or New
York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that
Sections 1, 6, 7, 8 and 13 shall survive such termination and remain in full
force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more of
the Underwriters shall fail at Closing Time or a Date of Delivery to purchase
the Securities which it or they are obligated to purchase under this Agreement
(the "Defaulted Securities"), the Underwriters shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than
all, of the Defaulted Securities in such amounts as may be agreed upon and
upon the terms herein set forth; if, however, the Underwriters shall not have
completed such arrangements within such 24-hour period, then:
(i) if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not
jointly, to purchase the full amount thereof in the proportions that
their respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting Underwriters, or
(ii) if the number of Defaulted Securities exceeds 10% of the number
of Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the Underwriters to purchase and of the Company to sell the
Option Securities to be purchased and sold on such Date of Delivery,
shall terminate without liability on the part of any non-defaulting
Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Company to sell the relevant Option
Securities, as the case may be, either the (i) Underwriters or (ii) the
Company shall have the right to postpone Closing Time or the relevant Date of
Delivery, as the case may be, for a period not exceeding seven days in order
to effect any required changes in the Registration Statement or Prospectus or
in any other documents or arrangements. As used herein, the term "Underwriter"
includes any person substituted for an Underwriter under this Section 10.
21
SECTION 11. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Underwriters c/o ;
notices to the Company and the Operating Partnership shall be directed to it
at 0000 Xxxxxxxxxx Xxxx, Xxxxx X00, Xxxxxxxx, XX 00000, attention of Xxxx X.
Xxxxx, Executive Vice President.
SECTION 12. Parties. This Agreement shall inure to the benefit of and be
binding upon the Underwriters, the Company and the Operating Partnership and
their respective successors. Nothing expressed or mentioned in this Agreement
is intended or shall be construed to give any person, firm or corporation,
other than the Underwriters, the Company and the Operating Partnership and
their respective successors and the controlling persons and officers, trustees
and directors referred to in Sections 6 and 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement
and all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the Underwriters and the Company and their respective
successors, and said controlling persons and officers, trustees and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Securities from any Underwriter
shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE. UNLESS OTHERWISE
EXPLICITLY PROVIDED, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
22
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement among the Underwriters, the Company and the Operating Partnership in
accordance with its terms.
Very truly yours,
LASALLE HOTEL PROPERTIES
By:
--------------------------
Name:
Title:
LASALLE HOTEL OPERATING PARTNERSHIP, L.P.
By: LaSalle Hotel Properties, its general partner
By:
--------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
[CO-MANAGERS]
By:
By:________________________
Authorized Signatory
On behalf of itself and the other
Underwriters named in Schedule A hereto.
23
SCHEDULE A
Number of
Name of Underwriter Initial Securities
------------------------------- ---------------------
[UNDERWRITERS].................
-------
Total....................
=======
Sch A - 1
SCHEDULE B
LASALLE HOTEL PROPERTIES
% Series Cumulative Redeemable Preferred Shares
(Par Value $.01 Per Share)
1. .The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $ .
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be $ , being an amount equal to the initial
public offering price set forth above less $ per share; provided that the
purchase price per share for any Option Securities purchased upon the exercise
of the over-allotment option described in Section 2(b) shall be reduced by an
amount per share equal to any dividends or distributions declared by the
Company and payable on the Initial Securities but not payable on the Option
Securities.
Sch B - 1
EXHIBIT A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
(i) The Company is a real estate investment trust duly formed and validly
existing and in good standing under the laws of the State of Maryland with
full trust power and authority to own and lease its properties and to conduct
its business as described in the Prospectus, and is duly qualified or
registered as a foreign real estate investment trust to conduct business and
is in good standing in each jurisdiction identified in Schedule 1 to such
counsel's opinion.
(ii) The authorized, issued and outstanding capital shares of the Company
are as set forth in the column entitled "Actual" under the caption
"Capitalization" (except for subsequent issuances thereof, if any,
contemplated under the Underwriting Agreement, pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectus or pursuant
to the exercise of convertible securities or options referred to in the
Prospectus). Such capital shares have been duly authorized and validly issued
by the Company and are fully paid and non-assessable, and none of such capital
shares was issued in violation of preemptive or other similar rights of any
securityholder of the Company.
(iii) All of the outstanding Units and Preferred Units, have been duly
authorized by the Operating Partnership and, assuming that the holders of
Units, as limited partners of the Operating Partnership, do not participate in
the control of the business of the Operating Partnership, the Units represent
valid and, subject to the qualifications set forth herein, fully paid and
nonassessable limited partner interests in the Operating Partnership as to
which the limited partners holding Units, in their capacity as limited
partners of the Operating Partnership, have no liability in excess of their
obligations to make contributions to the Operating Partnership, their
obligations to make other payments provided for in the Operating Partnership
Agreement and their share of the Operating Partnership's assets and
undistributed profits (subject to the obligation of a limited partner of the
Operating Partnership to repay any funds wrongfully distributed to it). To
such counsel's knowledge, except as described in the Prospectus, no Units are
reserved for any purpose, there are no outstanding securities convertible into
or exchangeable for any Units and there are no preemptive or other similar
rights to purchase or subscribe for Units or any other securities of the
Operating Partnership arising under the DRULPA (as defined below) or under the
Operating Partnership Agreement or any contracts to which the Operating
Partnership is a party of which such counsel is aware.
(iv) The Securities to be purchased by the Underwriters from the Company
have been duly authorized for issuance and sale to the Underwriters pursuant
to, and in accordance with the terms of, the Underwriting Agreement and, when
issued and delivered by the Company pursuant to the Underwriting Agreement
against payment of the consideration set forth in the Underwriting Agreement,
will be validly issued, fully paid and nonassessable; the issuance and sale of
the Securities by the Company is not subject to any preemptive or other
similar rights to purchase or subscribe for shares of beneficial interest of
the Company arising under the laws of the State of Maryland, the Declaration
of Trust and Bylaws of the Company or any contract to which the Company is a
party of which such counsel is aware.
(v) The Operating Partnership has been duly organized and is validly
existing as a limited partnership in good standing under the laws of the State
of Delaware and has the requisite power and authority to own, lease and
operate its properties and to conduct the business in which it is engaged as
described in the Operating Partnership Agreement and the Prospectus and is
duly qualified or registered as a foreign limited partnership to transact
business and is in good standing in each jurisdiction listed in Schedule 2 to
such counsel's opinion.
(vi) The execution and delivery of the Underwriting Agreement have been
duly authorized by all necessary action of the Company and the Operating
Partnership, and the Underwriting Agreement has been duly executed and
delivered by the Company and the Operating Partnership.
(vii) The Registration Statement, at the time that it became effective,
and the Prospectus, as of its date and as of the date hereof (in each case,
other than documents incorporated by reference therein and the financial
statements and the notes thereto, supporting schedules and other financial
data included or incorporated by reference therein or omitted therefrom or in
exhibits to or omitted from the Registration Statement, as to which no opinion
is rendered), complied as to form, in all material respects, with the
applicable requirements of the 1933 Act and the 1933 Act Regulations.
(viii) The documents incorporated by reference in the Prospectus (other
than documents incorporated by reference therein and the financial statements
and the notes thereto, supporting schedules and other financial data included
or incorporated by reference therein or omitted therefrom or in exhibits to or
omitted from the Registration Statement, as to which no opinion is rendered),
when they became effective or were filed with the Commission, as the case may
be, complied as to form, in all material respects, with the requirements of
the Securities Exchange Act of 1934, as amended, and the rules and regulations
of the Commission thereunder, as applicable.
(ix) The form of certificate used to evidence the Series Preferred
Shares of the Company complies, in all material respects, with all applicable
requirements of the laws of the State of Maryland, with any applicable
requirements of the Declaration of Trust and Bylaws of the Company and the
requirements of the New York Stock Exchange, Inc.
(x) To such counsel's knowledge and except as described or incorporated
by reference in the Prospectus, there is not pending or threatened any action,
suit, proceeding, inquiry or investigation, to which the Company, the
Operating Partnership or any Subsidiary is a party, or to which the property
of the Company, the Operating Partnership or any Subsidiary is subject, before
or brought by any court or governmental agency or body, domestic or foreign,
which might reasonably be expected to result in a Material Adverse Effect or
to affect the consummation of the transactions contemplated in the
Underwriting Agreement or the performance by the Company or the Operating
Partnership of their respective obligations thereunder.
(xi) The information in the Prospectus under "Description of the Series
Preferred Shares," "Description of Common Shares," "Description of
Preferred Shares," and "Federal
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Income Tax Considerations" to the extent that it constitutes matters of law,
summaries of legal matters, the Company's Declaration of Trust and Bylaws,
legal proceedings or legal conclusions, has been reviewed by such counsel and
is correct in all material respects.
(xii) To such counsel's knowledge, there are no Maryland, New York,
DRULPA or U.S. federal securities statutes or regulations that are required to
be described in the Prospectus that are not described as required.
(xiii) Commencing with its taxable year ended December 31, 1998, the
Company was organized and has been operated in conformity with the
requirements for qualification as a real estate investment trust under the
Internal Revenue Code of 1986, as amended (the "Code") and the proposed method
of operation of the Company and the Operating Partnership, as described in the
Prospectus and as represented by the Company and the Operating Partnership,
will permit the Company to continue to so qualify.
(xiv) All descriptions in the Registration Statement of contracts and
other documents which are filed as exhibits to the Annual Report on Form 10-K
to which the Company, the Operating Partnership or any Subsidiary is a party
are correct in all material respects. To such counsel's knowledge, there are
no franchises, contracts, indentures, mortgages, loan agreements, notes,
leases or other instruments required to be described or referred to therein or
filed or incorporated by reference as exhibits thereto that were not so filed,
incorporated by reference or described as required. To such counsel's
knowledge, (i) neither the Company nor the Operating Partnership is in
violation of its Governing Instruments and (ii) no default by the Company or
the Operating Partnership exists in the due performance or observance of any
material obligation, agreement, covenant or condition contained in any
agreement filed as an exhibit to the Annual Report on Form 10-K.
(xv) No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any U.S. federal, Maryland, Delaware
or New York State court or governmental authority or agency, domestic or
foreign (other than under the 1933 and the 1933 Act Regulations, which have
been obtained, or as may be required under the securities or blue sky laws of
the various states or the rules and regulations of the NASD, as to which we
express no opinion) is necessary or required in connection with the due
authorization, execution and delivery of the Underwriting Agreement or for the
offering, issuance, sale or delivery of the Securities.
(xvi) The execution, delivery and performance of the Underwriting
Agreement by the Company and the Operating Partnership and the consummation of
the transactions contemplated in the Underwriting Agreement and in the
Prospectus (including the issuance and sale of the Securities and the use of
the proceeds from the sale of the Securities as described in the Prospectus
under the caption "Use of Proceeds") and compliance by the Company and the
Operating Partnership with their respective obligations under the Underwriting
Agreement does not and will not (i) whether with or without the giving of
notice or lapse of time or both, conflict with or constitute a breach of, or
default or Repayment Event under, or result in the creation or imposition of
any material lien, charge or encumbrance upon any material property or assets
of the Company or the Operating Partnership pursuant to any contract listed as
an exhibit to the
A-3
Annual Report on Form 10-K to which the Company or the Operating Partnership
is a party or by which it or any of them may be bound or to which any of the
property or assets of the Company or the Operating Partnership is subject,
(ii) result in any violation of the provisions of the Governing Instruments of
the Company or the Operating Partnership, or (iii) result in any violation of
any applicable Maryland, New York, DRULPA or U.S. federal securities law,
statute, rule, regulation, judgement, order, writ or decree, known to such
counsel, of any Maryland, Delaware, New York or U.S. federal government,
government instrumentality or court, domestic or foreign, having jurisdiction
over the Company or the Operating Partnership or any of their respective
assets or properties, except in the case of clauses (i) and (iii) above, for
such violations, conflicts, breaches or defaults or liens, charges,
encumbrances or Repayment Events that would not result in a Material Adverse
Effect.
(xvii) Neither the Company nor the Operating Partnership is an
"investment company" or an entity "controlled" by an "investment company," as
such terms are defined in the 1940 Act.
(xviii) The Articles Supplementary relating to the Series Preferred
Shares have been filed for record with the Maryland State Department of
Assessment and Taxation, and the number, title, par value, liquidation
preference, ranking, distribution rate, distribution payment dates, redemption
provisions and other terms of the Series Preferred Shares have been set forth
therein.
Nothing has come to such counsel's attention that would lead such counsel
to believe that the Registration Statement (including any Rule 462(b)
Registration Statement) or any post-effective amendment thereto (other than
documents incorporated by reference therein and the financial statements and
the notes thereto, supporting schedules and other financial data included or
incorporated by reference therein or omitted therefrom or in exhibits to or
omitted from the Registration Statement, as to which no opinion is rendered),
at the time the Registration Statement (including any Rule 462(b) Registration
Statement) or any post-effective amendment thereto (including the filing of
the Company's Annual Report on Form 10-K with the Commission) became effective
or at the date of the Underwriting Agreement, contained an 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 or any amendment or supplement thereto (other than documents
incorporated by reference therein and the financial statements and the notes
thereto, supporting schedules and other financial data included or
incorporated by reference therein or omitted therefrom or in exhibits to or
omitted from the Registration Statement, as to which no opinion is rendered),
at the time the Prospectus was issued, at the time any such amended or
supplemented prospectus was issued or at the Closing Time, included or
includes an untrue statement of a material fact or omitted or omits 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.
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