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EXHIBIT 1.1
Pacific Gulf Properties Inc.
2,000,000 Shares(1)
Common Stock
UNDERWRITING AGREEMENT
January 15, 1997
PRUDENTIAL SECURITIES INCORPORATED
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Pacific Gulf Properties Inc., a Maryland corporation (the
"Company"), hereby confirms its agreement with Prudential Securities
Incorporated (the "Underwriter"), as set forth below.
1. Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Underwriter an
aggregate of 2,000,000 shares (the "Firm Securities") of the Company's Common
Stock, par value $.01 per share (the "Common Stock"). The Company also
proposes to issue and sell to the Underwriter not more than 300,000 additional
shares of Common Stock if requested by the Underwriter as provided in Section 3
of this Agreement. Any and all shares of Common Stock to be purchased by the
Underwriter pursuant to such option are referred to herein as the "Option
Securities," and the Firm Securities and any Option Securities are collectively
referred to herein as the "Securities."
2. Representations and Warranties of the Company. The
Company represents and warrants to, and agrees with, the Underwriter that:
(a) The Company meets the requirements for use of
Form S-3 under the Securities Act of 1933, as amended (the "Act"). A
registration statement on such Form (File No. 333-2798) with respect to the
Securities, including a basic prospectus, has been filed by the Company with
the Securities and Exchange Commission (the "Commission") under the Act, and
one or more amendments to such registration statement may have been so filed.
Such registration statement, as so amended, has been declared by the Commission
to be effective under the Act. Such registration statement, as amended at the
date of this
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(1) Plus an option to purchase from Pacific Gulf Properties Inc. up to
300,000 additional shares to cover over-allotments.
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Agreement, meets the requirements set forth in Rule 415(a)(1)(x) under the Act
and complies in all other material respects with said Rule. The Company will
next file with the Commission either (A) if the Company relies on Rule 434 under
the Act, a Term Sheet (as hereinafter defined) relating to the Securities that
shall identify the Preliminary Prospectus (as hereinafter defined) that it
supplements and, if required to be filed pursuant to Rules 434(c)(2) and 424(b),
an Integrated Prospectus (as hereinafter defined), in either case, containing
such information as is required or permitted by Rule 434, 430A and 424(b) under
the Act or (B) if the Company does not rely on Rule 434 under the Act, pursuant
to Rule 424(b) under the Act a final prospectus supplement to the basic
prospectus included in such registration statement, as so amended, describing
the Securities and the offering thereof, in such form as has been provided to,
or discussed with, and approved by the Underwriter as provided in section 5(a)
of this Agreement. As used in this Agreement, the term "Registration Statement"
means such registration statement, as amended at the time when it was declared
effective, including (i) all financial schedules and exhibits thereto, (ii) all
documents incorporated by reference or deemed to be incorporated by reference
therein and (iii) any information omitted therefrom pursuant to Rule 430A under
the Act and included in the Prospectus (as hereinafter defined) or, if required
to be filed pursuant to Rule 434(c)(2) and 424(b) under the Act, in the
Integrated Prospectus; the term "Basic Prospectus" means the prospectus included
in the Registration Statement as amended by any form of prospectus filed
thereafter pursuant to Rule 424; the term "Preliminary Prospectus" means any
preliminary form of the Prospectus (as hereinafter defined) specifically
relating to the Securities, in the form first filed with, or transmitted for
filing to, the Commission pursuant to Rule 424 under the Act; the term
"Prospectus Supplement" means any prospectus supplement specifically relating to
the Securities, in the form first filed with, or transmitted for filing to, the
Commission pursuant to Rule 424 under the Securities Act; the term "Prospectus"
means (A) if the Company relies on Rule 434 under the Act, the Term Sheet
relating to the Securities that is first filed pursuant to Rule 424(b)(7) under
the Act, together with the Preliminary Prospectus identified therein that such
Term Sheet supplements; (B) if the Company does not rely on Rule 434 under the
Act, the Preliminary Prospectus; or (C) if the Company does not rely on Rule 434
under the Act and if no Preliminary Prospectus is required to be filed, the
Basic Prospectus, including, in each case, the Prospectus Supplement; "Basic
Prospectus," "Prospectus," "Preliminary Prospectus" and "Prospectus Supplement"
shall include in each case the documents, if any, filed by the Company with the
Commission pursuant to the United States Securities Exchange of 1934, as amended
(the "Exchange Act"), and incorporated by reference therein; the term
"Integrated Prospectus" means a prospectus first filed with the Commission
pursuant to Rules 434(c)(2) and 424(b) under the Act; and the term "Term Sheet"
means any abbreviated term sheet that satisfies the requirements of Rule 434
under the Act. Any reference in this Agreement to an "amendment" or
"supplement" to any Preliminary Prospectus, the Prospectus, or any Integrated
Prospectus or an "amendment" to any registration statement (including the
Registration Statement) shall be deemed to include any document incorporated by
reference therein that is filed with the Commission under the Exchange Act after
the date of such Preliminary Prospectus, Prospectus, Integrated Prospectus or
registration statement, as the case may be. For purposes of the preceding
sentence, any reference to the "effective date" of an amendment to a
registration statement shall, if such amendment is effected by means of the
filing with the Commission under the Exchange Act
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of a document incorporated by reference in such registration statement, be
deemed to refer to the date on which such document was so filed with the
Commission; any reference herein to the "date" of a Prospectus that includes a
Term Sheet shall mean the date of such Term Sheet.
(b) The Commission has not issued any order
preventing or suspending the use of any Preliminary Prospectus. When any
Preliminary Prospectus and any amendment or supplement thereto was filed with
the Commission, it (i) contained all statements required to be stated therein
in accordance with, and complied in all material respects with the requirements
of, the Act, the Exchange Act and the respective rules and regulations of the
Commission thereunder, and (ii) did not include any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading. When the Registration Statement or any amendment thereto
was declared effective, it (i) contained all statements required to be stated
therein in accordance with, and complied in all material respects with the
requirements of, the Act, the Exchange Act and the respective rules and
regulations of the Commission thereunder and (ii) did not include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein not misleading. When the Prospectus or any Term
Sheet that is a part thereof or any Integrated Prospectus or any amendment or
supplement to the Prospectus is filed with the Commission pursuant to Rule
424(b) (or, if the Prospectus or part thereof or such amendment or supplement
is not required to be so filed, when the Registration Statement or the
amendment thereto containing such amendment or supplement to the Prospectus was
or is declared effective), on the date when the Prospectus is otherwise amended
or supplemented and on the Firm Closing Date and any Option Closing Date (both
as hereinafter defined), each of the Prospectus, and, if required to be filed
pursuant to Rules 434(c)(2) and 424(b) under the Act, the Integrated Prospectus
as amended or supplemented at any such time, (i) contained or will contain all
statements required to be stated therein in accordance with, and complied or
will comply in all material respects with the requirements of, the Act, the
Exchange Act and the respective rules and regulations of the Commission
thereunder and (ii) did not or will not include any untrue statement of a
material fact or omit to state any 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 provisions of this paragraph (b) do not
apply to statements or omissions made in any Preliminary Prospectus or any
amendment or supplement thereto, the Registration Statement or any amendment
thereto, the Prospectus or, if required to be filed pursuant to Rules 434(c)(2)
and 424(b) under the Act, the Integrated Prospectus or any amendment or
supplement thereto, in reliance upon and in conformity with written information
furnished to the Company by the Underwriter specifically for use therein.
(c) If the Company has elected to rely on Rule
462(b), (i) the Company has filed a Rule 462(b) Registration Statement in
compliance with and that is effective upon filing pursuant to Rule 462(b) and
has received confirmation of its receipt and (ii) the Company has given
irrevocable instructions for transmission of the applicable filing fee in
connection with the filing of the Rule 462(b) Registration Statement, in
compliance with Rule 111 promulgated under the Act or the Commission has
received payment of such filing fee.
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(d) The Company has been duly organized and is
validly existing as a corporation in good standing under the laws of the State
of Maryland. PGP Inland Communities, L.P., a Delaware limited partnership (the
"Partnership"), and Pacific Inland Communities, LLC, a California limited
liability company (the "LLC" and together with the Partnership, the
"Subsidiaries") are the only subsidiaries (direct or indirect) of the Company,
each has been duly formed and is validly existing and in good standing under
the laws of its jurisdiction of formation. The Company and the Subsidiaries
are duly qualified to transact business as foreign entities, and are in good
standing under the laws of all other jurisdictions where the ownership or
leasing of their respective properties or the conduct of their respective
businesses requires such qualification, except where the failure to be so
qualified does not amount to a material liability or disability to the Company
and the Subsidiaries, taken as a whole.
(e) None of the Subsidiaries is currently
prohibited, directly or indirectly, from paying any dividends to the Company,
from making any other distribution on such Subsidiary's equity interests, from
repaying to the Company any loans or advances to such Subsidiary from the
Company or from transferring any of such Subsidiary's property or assets to the
Company or any other Subsidiary of the Company, except as described in the
Prospectus and any Integrated Prospectus (or, if the Prospectus and any
required Integrated Prospectus are not in existence, the most recent
Preliminary Prospectus).
(f) The Company and each of the Subsidiaries have
full power (corporate and/or other) to own or lease their respective properties
and conduct their respective businesses as described in the Registration
Statement and each of the Prospectus and any Integrated Prospectus or, if the
Prospectus and any required Integrated Prospectus are not in existence, the
most recent Preliminary Prospectus; and the Company has full power (corporate
and other) to enter into this Agreement and to carry out all the terms and
provisions hereof to be carried out by it.
(g) The outstanding equity interests of each
Subsidiary have been duly authorized and validly issued, are fully paid and
non-assessable and to the extent shown in Exhibit A hereto are owned by the
Company free and clear of all liens, encumbrances, equities and claims; and no
options, warrants or other rights to purchase, agreements or other obligations
to issue or other rights to convert any obligations into ownership interests in
each Subsidiary are outstanding.
(h) The Company has an authorized, issued and
outstanding capitalization as set forth in the Prospectus and any Integrated
Prospectus or, if the Prospectus and any required Integrated Prospectus are not
in existence, the most recent Preliminary Prospectus. All of the issued shares
of capital stock of the Company have been duly authorized and validly issued
and are fully paid and nonassessable. The Firm Securities and the Option
Securities have been duly authorized and at the Firm Closing Date or the
related Option Closing Date (as the case may be), after payment therefor in
accordance herewith, will be validly issued, fully paid and nonassessable. No
holders of outstanding shares of capital
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stock of the Company are entitled as such to any preemptive or other rights to
subscribe for any of the Securities, and no holder of securities of the Company
has any right which has not been fully exercised or waived to require the
Company to register the offer or sale of any securities owned by such holder
under the Act in the public offering contemplated by this Agreement.
(i) The capital stock of the Company conforms to the
description thereof contained in the Registration Statement and each of the
Prospectus and any Integrated Prospectus or, if the Prospectus and any required
Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus.
(j) Except as disclosed in the Prospectus and any
Integrated Prospectus (or, if the Prospectus and any required Integrated
Prospectus are not in existence, the most recent Preliminary Prospectus), there
are not outstanding (i) securities, partnership interests or obligations of the
Company or any Subsidiary convertible into or exchangeable for any capital
stock of the Company or ownership interest in the Subsidiaries, (ii) warrants,
rights or options to subscribe for or purchase from the Company or any
Subsidiary any such capital stock or ownership interest or any such convertible
or exchangeable securities, partnership interests or obligations, or (iii)
obligations of the Company or any Subsidiary to issue any shares of capital
stock or ownership interest, any such convertible or exchangeable securities,
partnership interests or obligations, or any such warrants, rights or options.
(k) The consolidated financial statements and
schedules of the Company and the Subsidiaries included in the Registration
Statement, Prospectus and any Integrated Prospectus (or, if the Prospectus and
any required Integrated Prospectus are not in existence, the most recent
Preliminary Prospectus) fairly present the financial position of the Company
and the Subsidiaries and the results of operations and changes in financial
condition as of the dates and periods therein specified. Such financial
statements and schedules have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved (except as otherwise noted therein). The selected financial data set
forth under the caption "Selected Financial Information" in the Registration
Statement and each of the Prospectus and any Integrated Prospectus (or, if the
Prospectus and any required Integrated Prospectus are not in existence, the
most recent Preliminary Prospectus) fairly present, on the basis stated in the
Registration Statement and each of the Prospectus and any Integrated Prospectus
(or such Preliminary Prospectus), the information included therein. The pro
forma financial statements and other pro forma financial information included
in the Registration Statement, Prospectus and any Integrated Prospectus (or, if
the Prospectus and any required Integrated Prospectus are not in existence, the
most recent Preliminary Prospectus) comply in all material respects with the
applicable requirements of Rule 11-02 of Regulation S-X of the Commission and
the pro forma adjustments have been properly applied to the historical amounts
in the compilation of such statements and the assumptions used in the
preparation thereof are, in the opinion of the Company, reasonable.
(l) Ernst & Young LLP, who have certified certain
financial statements
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of the Company and the Subsidiaries and delivered their report with respect to
the audited consolidated financial statements and schedules included in the
Registration Statement and each of the Prospectus and any Integrated Prospectus
(or, if the Prospectus and any required Integrated Prospectus are not in
existence, the most recent Preliminary Prospectus), are independent public
accountants as required by the Act, the Exchange Act and the related published
rules and regulations thereunder.
(m) The execution and delivery of this Agreement
have been duly authorized by the Company and this Agreement has been duly
executed and delivered by the Company and is the valid and binding agreement of
the Company, enforceable against the Company in accordance with its terms,
subject to the effect of bankruptcy, insolvency, moratorium, fraudulent
conveyance, reorganization and similar laws relating to creditors' rights
generally and to the application of equitable principles in any proceeding,
whether at law or in equity and except as rights to indemnity and contribution
hereunder may be limited by federal or state securities laws or principles of
public policy.
(n) No legal or governmental proceedings are pending
to which the Company or any of the Subsidiaries is a party or to which the
property of the Company or of any of the Subsidiaries is subject that are
required to be described in the Registration Statement or each of the
Prospectus and any Integrated Prospectus (or, if the Prospectus and any
required Integrated Prospectus are not in existence, the most recent
Preliminary Prospectus), and are not described therein, and no such proceedings
which may be material with respect to the Company and the Subsidiaries taken as
a whole have been threatened against the Company or any of the Subsidiaries or
with respect to any of their respective properties; and no contract or other
document is required to be described in the Registration Statement or the
Prospectus or any Integrated Prospectus (or, if the Prospectus and any required
Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus) or to be filed as an exhibit to the Registration Statement that is
not described therein or filed as required.
(o) The issuance, offering and sale of the
Securities to the Underwriter by the Company pursuant to this Agreement, the
compliance by the Company with the other provisions of this Agreement and the
consummation of the other transactions herein contemplated do not (i) require
the consent, approval, authorization, registration or qualification of or with
any governmental authority, except such as have been obtained, such as may be
required under state securities or blue sky laws and, such as may be required
(and shall be obtained as provided in this Agreement) under the Act, or (ii)
conflict with or result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, lease or other agreement or instrument to which the Company or any of
the Subsidiaries is a party or by which the Company or any of the Subsidiaries
or any of their respective properties are bound, or the charter documents (or
other formation documents) or by-laws of the Company or any of the
Subsidiaries, or any statute or any judgment, decree, order, rule or regulation
of any court or other governmental authority or any arbitrator applicable to
the Company or any of the Subsidiaries.
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(p) Subsequent to the respective dates as of which
information is given in the Registration Statement and each of the Prospectus
or any Integrated Prospectus or, if the Prospectus and any required Integrated
Prospectus are not in existence, the most recent Preliminary Prospectus,
neither the Company nor any of the Subsidiaries has sustained any material loss
or interference with their respective businesses or properties from fire,
flood, hurricane, accident or other calamity, except as to damage caused by
recent storms on the United States West Coast (the "West Coast") for which
uninsured losses do not exceed $100,000 or from any labor dispute or any legal
or governmental proceeding and there has not been any material adverse change,
or any development involving a prospective material adverse change, in the
condition (financial or otherwise), management, business prospects, net worth,
or results of operations of the Company and the Subsidiaries considered as a
whole, except in each case as described in or contemplated by the Registration
Statement and each of the Prospectus and any Integrated Prospectus or, if the
Prospectus and any required Integrated Prospectus are not in existence, the
most recent Preliminary Prospectus.
(q) The Company has not, directly or indirectly, (i)
taken any action designed to cause or to result in, or that has constituted or
which 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 or (ii) since the filing of the Registration
Statement (A) sold, bid for, purchased, or paid anyone any compensation for
soliciting purchases of, the Securities or (B) paid or agreed to pay to any
person any compensation for soliciting another to purchase any other securities
of the Company other than with respect to the offering of Common Stock pursuant
to the Prospectus Supplement dated May 23, 1996, the offering of the Class A
Senior Cumulative Convertible Preferred Stock pursuant to the Prospectus
Supplement dated December 31, 1996 to the Prospectus and the exchange of
$42,069,000 of the 8.375% Convertible Subordinated Debentures due 2001 for
shares of Common Stock pursuant to an exchange offer originally filed with the
Commission on November 8, 1996.
(r) The Company has not distributed and, prior to
the later of (i) the Firm Closing Date and (ii) the completion of the
distribution of the Securities, will not distribute any offering material in
connection with the offering and sale of the Securities other than the
Registration Statement or any amendment thereto, any Preliminary Prospectus or
the Prospectus or any amendment or supplement thereto, or other materials, if
any permitted by the Act.
(s) Subsequent to the respective dates as of which
information is given in the Registration Statement and each of the Prospectus
or any Integrated Prospectus (or, if the Prospectus or any required Integrated
Prospectus are not in existence, the most recent Preliminary Prospectus), (i)
none of the Company or any of the Subsidiaries have incurred any material
liability or obligation, direct or contingent, nor entered into any material
transaction not in the ordinary course of business; (ii) the Company has not
purchased any of its outstanding capital stock, nor declared, paid or otherwise
made any dividend or distribution of any kind on its capital stock; and (iii)
there has not been any material change in the capital
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stock, ownership interest, short-term debt or long-term debt of the Company and
the Subsidiaries, except in each case as described in or contemplated by the
Prospectus or any Integrated Prospectus (or, if the Prospectus or any required
Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus).
(t) The Company and each Subsidiary have good and
marketable title in fee simple to all items of real property and marketable
title to all personal property owned by each of them, in each case free and
clear of any security interests, liens, encumbrances, equities, claims and
other defects, except such as do not materially and adversely affect the value
of such property and do not interfere with the use made or proposed to be made
of such property by the Company and each Subsidiary, and any real property and
buildings held under lease by the Company or by any Subsidiary are held under
valid, subsisting and enforceable leases, with such exceptions as are not
material and do not interfere with the use made or proposed to be made of such
property and buildings by the Company or by any Subsidiary, in each case except
as described in or contemplated by the Prospectus or any Integrated Prospectus
(or, if the Prospectus or any required Integrated Prospectus are not in
existence, the most recent Preliminary Prospectus).
(u) The Company and each Subsidiary are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts as are prudent and customary in the businesses in which
they are engaged; and none of the Company or any of the Subsidiaries have any
reason to believe that they will not be able to renew their existing insurance
coverage as and when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue their business at a cost that
would not materially and adversely affect the condition (financial or
otherwise), business prospects, net worth or results of operations of the
Company and its Subsidiaries taken as a whole, except as described in or
contemplated by the Prospectus or any Integrated Prospectus (or, if the
Prospectus or any required Integrated Prospectus are not in existence, the most
recent Preliminary Prospectus).
(v) The Company and each Subsidiary possess all
material certificates, authorizations and permits issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct their
respective businesses, and none of the Company or any of the Subsidiaries has
received any notice of proceedings relating to the revocation or modification
of any such certificate, authorization or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would
result in a material adverse change in the condition (financial or otherwise),
business prospects, net worth or results of operations of the Company and the
Subsidiaries taken as a whole, except as described in or contemplated by the
Prospectus or any Integrated Prospectus (or, if the Prospectus or any required
Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus).
(w) The Company will conduct its operations in a
manner that will not subject it to registration as an investment company under
the Investment Company Act of 1940, as amended, (the "1940 Act") and this
transaction will not cause the Company to
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become an investment company subject to registration under such act.
(x) The Company and each Subsidiary have filed all
foreign, federal, state and local tax returns that are required to be filed or
have requested extensions thereof (except in any case in which the failure so
to file would not have a material adverse effect on the Company and the
Subsidiaries taken as a whole) and have paid all taxes required to be paid by
them and any other assessment, fine or penalty levied against them, to the
extent that any of the foregoing is due and payable, except for any such
assessment, fine or penalty that is currently being contested in good faith or
as described in or contemplated by the Registration Statement and each of the
Prospectus or any Integrated Prospectus (or, if the Prospectus or any required
Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus). Such tax returns are true, correct, and complete in all material
respects.
(y) The Company and each Subsidiary maintain a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with management's
general or specific authorizations; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's general or
specific authorization; (iv) the recorded accountability for assets is compared
with the existing assets at reasonable intervals and appropriate action is
taken with respect to any differences; and (v) the Company is complying with
the REIT requirements of the Internal Revenue Code of 1986, as amended.
(z) Except as would not have a material adverse
effect or otherwise require disclosure in the Prospectus or any Integrated
Prospectus (or, if the Prospectus or any required Integrated Prospectus are not
in existence, the most recent Preliminary Prospectus), (i) the Company and the
Subsidiaries are not in violation of any federal, state or local laws and
regulations relating to pollution or protection of human health or the
environment or the use, treatment, storage, disposal, transport or handling,
emission, discharge, release or threatened release of toxic or hazardous
substances, materials or wastes, or petroleum and petroleum products
("Materials of Environmental Concern") (collectively, "Environmental Laws"),
including, without limitation, noncompliance with or lack of any permits or
other environmental authorizations, and (ii) (A) the Company and the
Subsidiaries have not received any communication from any person or entity
alleging any violation of or noncompliance with any Environmental Laws, and
there are no past, present or reasonably foreseeable circumstances that could
reasonably be expected to lead to any such violation in the future, (B) there
is no pending or threatened claim, action, investigation or notice by any
person or entity against the Company or any Subsidiary or against any person or
entity for whose acts or omissions the Company or any Subsidiary are or may
reasonably be expected to be liable, either contractually or by operation of
law, alleging liability for investigatory, cleanup, or governmental response
costs, or natural resources or property damages, or personal injuries,
attorney's fees or penalties relating to any Materials of Environmental Concern
or any violation or potential violation, of any Environmental Law
(collectively, "Environmental Claims"),
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and (C) there are no actions, activities, circumstances, conditions, events or
incidents that could reasonably be expected to form the basis of any such
Environmental Claim. In the ordinary course of business, each of the Company
and the Subsidiaries (i) conducts a periodic review of the effect of
Environmental Laws on its business, operations and properties, and the Company
and the Subsidiaries have identified and evaluated associated costs and
liabilities, and any capital or operating expenditures, required for cleanup,
closure of properties or compliance with Environmental Laws or any permit,
license or approval, any related constraints on operating activities, and any
potential liabilities to third parties, and (ii) consistent with industry
standards have conducted environmental investigations of, and reviewed
information regarding, its business, properties and operations; on the basis of
such reviews, investigations and inquiries, the Company and each Subsidiary
have reasonably concluded that, except as disclosed in the Prospectus or any
Integrated Prospectus, any costs and liabilities associated with such matters
would not have a material adverse effect on the Company or any Subsidiary or
otherwise require disclosure in the Prospectus or any Integrated Prospectus.
(aa) The Company and each Subsidiary are in
compliance in all material respects with all presently applicable provisions of
the Employee Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"); no "reportable
event" (as defined in ERISA) has occurred with respect to any "pension plan"
(as defined in ERISA) for which the Company or any Subsidiary would have any
liability; the Company has not incurred and does not expect to incur liability
under (i) Title IV of ERISA with respect to termination of, or withdrawal from,
any "pension plan" or (ii) Sections 4971 of the Internal Revenue Code of 1986,
as amended, including the regulations and published interpretations thereunder
(the "Code"); and each "pension plan" in which employees or former employees of
the Company or any Subsidiary participate that is intended to be qualified
under Section 401(a) of the Code is so qualified in all material respects and
nothing has occurred, whether through any action or by failure to act, which
would cause the loss of such qualification.
(ab) The Company has been and is organized and
operated in conformity with the requirements for qualification as a real estate
investment trust (a "REIT") under Sections 856 through 860 of the Code and the
rules and regulations thereunder and the Company's proposed method of operation
will enable it to continue to meet the requirements for taxation as a real
estate investment trust under the Code.
3. Purchase, Sale and Delivery of the Securities.
(a) On the basis of the representations, warranties,
agreements and covenants herein contained and subject to the terms and
conditions herein set forth, the Company agrees to issue and sell to the
Underwriter, and the Underwriter, agrees to purchase from the Company, at a
purchase price of $20.50 per share, the Firm Securities. One or more
certificates in definitive form for the Firm Securities that the Underwriter
has agreed to purchase hereunder, and in such denomination or denominations and
registered in such name
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or names as the Underwriter requests upon notice to the Company at least 48
hours prior to the Firm Closing Date, shall be delivered by or on behalf of the
Company to the Underwriter for the its accounts, against payment by or on
behalf of the Underwriter of the purchase price therefor by wire transfer in
same-day funds (the "Wired Funds") to the account of the Company. Such
delivery of and payment for the Firm Securities shall be made at the offices of
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, 000 Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxxxxx, Xxxxxxxxxx 00000, at 9:30 A.M., New York time, on January 21,
1997, or at such other place, time or date as the Underwriter and the Company
may agree upon, such time and date of delivery against payment being herein
referred to as the "Firm Closing Date." The Company will make such certificate
or certificates for the Firm Securities available for checking and packaging by
the Underwriter at the offices in New York, New York of the Company's transfer
agent or registrar or of the Underwriter at least 24 hours prior to the Firm
Closing Date.
(b) For the purpose of covering any over-allotments
in connection with the distribution and sale of the Firm Securities as
contemplated by the Prospectus, the Company hereby grants to the Underwriter an
option to purchase the Option Securities. The purchase price to be paid for
any Option Securities shall be the same price per share as the price per share
for the Firm Securities set forth above in paragraph (a) of this Section 3,
plus if the purchase and sale of any Option Securities takes place after the
Firm Closing Date and after the Firm Securities are trading "ex-dividend," an
amount equal to the dividend payable on such Option Securities. The option
granted hereby may be exercised as to all or any part of the Option Securities
from time to time within thirty days after the date of the Prospectus (or, if
such 30th day shall be a Saturday or Sunday or a holiday, on the next business
day thereafter when the New York Stock Exchange is open for trading). The
Underwriter shall not be under any obligation to purchase any of the Option
Securities prior to the exercise of such option. The Underwriter may from time
to time exercise the option granted hereby by giving notice in writing or by
telephone (confirmed in writing) to the Company setting forth the aggregate
principal amount of Option Securities as to which the Underwriter is then
exercising the option and the date and time for delivery of and payment for
such Option Securities. Any such date of delivery shall be determined by the
Underwriter but shall not be earlier than two business days or later than five
business days after such exercise of the option and, in any event, shall not be
earlier than the Firm Closing Date. The time and date set forth in such
notice, or such other time on such other date as the Underwriter and the
Company may agree upon, is herein called the "Option Closing Date" with
respect to such Option Securities. Upon exercise of the option as provided
herein, the Company shall become obligated to sell to the Underwriter, and,
subject to the terms and conditions herein set forth, the Underwriter shall
become obligated to purchase from the Company, the same percentage of the total
number of the Option Securities as to which the Underwriter is then exercising
the option. If the option is exercised as to all or any portion of the Option
Securities, one or more certificates in definitive form for such Option
Securities, and payment therefor, shall be delivered on the related Option
Closing Date in the manner, and upon the terms and conditions, set forth in
paragraph (a) of this Section 3, except that reference therein to the Firm
Securities and the Firm Closing Date shall be deemed, for purposes of this
paragraph
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(b), to refer to such Option Securities and Option Closing Date, respectively.
(c) The Company hereby acknowledges that the wire
transfer by or on behalf of the Underwriter of the purchase price for any
Securities does not constitute closing of a purchase and sale of the
Securities. Only execution and delivery of a receipt for Securities by the
Underwriter indicates completion of the closing of a purchase of the Securities
from the Company. Furthermore, in the event that the Underwriter wire funds to
the Company prior to the completion of the closing of a purchase of Securities,
the Company hereby acknowledges that until the Underwriter execute and deliver
a receipt for the Securities, by facsimile or otherwise, the Company will not
be entitled to the wired funds and shall return the wired funds to the
Underwriter as soon as practicable (by wire transfer of same-day funds) upon
demand. In the event that the closing of a purchase of Securities is not
completed and the wire funds are not returned by the Company to the Underwriter
on the same day the wired funds were received by the Company, the Company
agrees to pay to the Underwriter in respect of each day the wire funds are not
returned by it, in same-day funds, interest on the amount of such wire funds in
an amount representing the Underwriter's cost of financing as reasonably
determined by the Underwriter.
4. Offering by the Underwriter. Upon your authorization of
the release of the Firm Securities, the Underwriter proposes to offer the Firm
Securities for sale to the public upon the terms set forth in the Prospectus.
5. Covenants of the Company. The Company covenants and agrees
with the Underwriter that:
(a) The Company will file the Prospectus or any
Term Sheet that constitutes a part thereof, any Integrated Prospectus,
Prospectus Supplement, as the case may be, and any amendment or supplement
thereto with the Commission in the manner and within the time period required
by Rules 434 and 424(b) under the Act. During any time when a prospectus
relating to the Securities is required to be delivered under the Act, the
Company (i) will comply with all requirements imposed upon it by the Act and
the Exchange Act and the respective rules and regulations of the Commission
thereunder to the extent necessary to permit the continuance of sales of or
dealings in the Securities in accordance with the provisions hereof and of the
Prospectus and any Integrated Prospectus, as then amended or supplemented, and
(ii) will not file with the Commission the Prospectus, Term Sheet any
Integrated Prospectus or any amendment or supplement thereto or any amendment
to the Registration Statement or any Rule 462(b) Registration Statement of
which the Underwriter shall not previously have been advised and furnished with
a copy for a reasonable period of time prior to the proposed filing and as to
which filing the Underwriter shall not have given its consent. The Company
will prepare and file with the Commission, in accordance with the rules and
regulations of the Commission, promptly upon request by the Underwriter or
counsel for the Underwriter, any amendments to the Registration Statement or
amendments or supplements to the Prospectus and any Integrated Prospectus that
may be necessary or advisable in connection with the distribution of the
Securities by the Underwriter, and will
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use its best efforts to cause any such amendment to the Registration Statement
to be declared effective by the Commission as promptly as possible. The Company
will advise the Underwriter, promptly after receiving notice thereof, of the
time when any amendment to the Registration Statement has been filed or declared
effective or the Prospectus, any Integrated Prospectus or any amendment or
supplement thereto has been filed and will provide evidence satisfactory to the
Underwriter of each such filing or effectiveness.
(b) The Company will advise the Underwriter, promptly
after receiving notice or obtaining knowledge thereof, of (i) the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or any Rule 462(b) Registration Statement or any
post-effective amendment thereto or any order directed at any document
incorporated by reference in the Registration Statement, the Prospectus or any
Integrated Prospectus or any order preventing or suspending the use of any
Preliminary Prospectus, the Prospectus and any Integrated Prospectus or any
amendment or supplement thereto, (ii) the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, (iii) the institution,
threatening or contemplation of any proceeding for any such purpose or (iv) any
request made by the Commission for amending the Registration Statement or any
Rule 462(b) Registration Statement, for amending or supplementing any
Preliminary Prospectus or the Prospectus and any Integrated Prospectus or for
additional information. The Company will use its best efforts to prevent the
issuance of any such stop order and, if any such stop order is issued, to obtain
the withdrawal thereof as promptly as possible.
(c) The Company will arrange for the qualification of
the Securities for offering and sale under the securities or blue sky laws of
such jurisdictions as the Underwriter may designate and will continue such
qualifications in effect for as long as may be necessary to complete the
distribution of the Securities, provided, however, that in connection therewith
the Company shall not be required to qualify as a foreign corporation or to
execute a general consent to service of process in any jurisdiction.
(d) If, at any time prior to the later of (i) the
final date when a prospectus relating to the Securities is required to be
delivered under the Act or (ii) the Option Closing Date, any event occurs as a
result of which the Prospectus or any Integrated Prospectus, as then amended or
supplemented, would include any untrue statement of a material fact or 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, or if for
any other reason it is necessary at any time to amend or supplement the
Prospectus or any Integrated Prospectus to comply with the Act, the Exchange Act
or the respective rules or regulations of the Commission thereunder, the Company
will promptly notify the Underwriter thereof and, subject to Section 5(a)
hereof, will prepare and file with the Commission, at the Company's expense, an
amendment to the Registration Statement or an amendment or supplement to the
Prospectus or any Integrated Prospectus that corrects such statement or omission
or effects such compliance.
(e) The Company will, without charge, provide (i) to
the Underwriter
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and to counsel for the Underwriter one conformed copy of the registration
statement originally filed with respect to the Securities or any Rule 462(b)
Registration Statement and each amendment thereto (in each case including
exhibits thereto), and (ii) so long as a prospectus relating to the Securities
is required to be delivered under the Act, as many copies of each Preliminary
Prospectus, the Prospectus or any Integrated Prospectus or any amendment or
supplement thereto as the Underwriter may reasonably request; without limiting
the application of clause (ii) of this sentence, the Company, not later than
(A) 6:00 PM, New York City time, on the date of determination of the public
offering price, if such determination occurred at or prior to 10:00 AM, New
York City time on such date or (B) 2:00 PM, New York City time, on the business
day following the date of determination of the public offering price, if such
determination occurred after 10:00 AM, New York City time, on such date, will
deliver to the Underwriter, without charge, as many copies of the Prospectus
and any amendment or supplement thereto as the Underwriter may reasonably
request for purposes of confirming orders that are expected to settle on the
Firm Closing Date.
(f) The Company, as soon as practicable, will make
generally available to its security holders and to the Underwriter a
consolidated earnings statement of the Company and its subsidiaries that
satisfies the provisions of Section 11(a) of the Act and Rule 158 thereunder.
(g) The Company will apply the net proceeds from the
sale of the Securities as set forth under "Use of Proceeds" in the Prospectus
or any Integrated Prospectus.
(h) The Company will not, directly or indirectly,
without the prior written consent of the Underwriter, offer, sell, offer to
sell, contract to sell, pledge, grant any option to purchase or otherwise sell
or dispose (or announce any offer, sale, offer of sale, contract of sale,
pledge, grant of any option to purchase or other sale or disposition) of any
shares of Common Stock or any securities convertible into, or exchangeable or
exercisable for, shares of Common Stock for a period of 90 days after the date
hereof, except pursuant to this Agreement and except for issuances pursuant to
the Company's Dividend Reinvestment Plan and issuances pursuant to the
Company's 1993 Share Option Plan.
(i) The Company will not, directly or indirectly,
(i) take any action designed to cause or to result in, or that has constituted
or which 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 or (ii) (A) sell, bid for, purchase, or pay anyone
any compensation for soliciting purchases of, the Securities or (B) pay or
agree to pay to any person any compensation for soliciting another to purchase
any other securities of the Company.
(j) The Company will obtain the agreements described
in Section 7(f) hereof prior to the Firm Closing Date.
(k) If at any time during the 25-day period after
the Registration Statement becomes effective or the period prior to the Option
Closing Date, any rumor,
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publication or event relating to or affecting the Company shall occur as a
result of which in your opinion the market price of the Common Stock has been
or is likely to be materially affected (regardless of whether such rumor,
publication or event necessitates a supplement to or amendment of the
Prospectus and any Integrated Prospectus), the Company will, after notice from
you advising the Company to the effect set forth above, forthwith prepare,
consult with you concerning the substance of, and disseminate a press release
or other public statement, reasonably satisfactory to you, responding to or
commenting on such rumor, publication or event.
(l) The Company will use its best efforts to cause
the Securities to be duly authorized for listing by the New York Stock Exchange
prior to the Firm Closing Date.
6. Expenses. The Company will pay all costs and expenses
incident to the performance of its obligations under this Agreement, whether or
not the transactions contemplated herein are consummated or this Agreement is
terminated pursuant to Section 11 hereof, including all costs and expenses
incident to (i) the printing or other production of documents with respect to
the transactions, including any costs of printing the registration statement
originally filed with respect to the Securities and any amendment thereto, any
Preliminary Prospectus, the Prospectus and any Integrated Prospectus and any
amendment or supplement thereto, this Agreement and any blue sky memoranda,
(ii) all arrangements relating to the delivery to the Underwriter of copies of
the foregoing documents, (iii) the fees and disbursements of the counsel,
accountants and any other experts or advisors retained by the Company, (iv)
preparation, issuance and delivery to the Underwriter of any certificates
evidencing the Securities, including transfer agent's and registrar's fees, (v)
the qualification of the Securities under state securities and blue sky laws,
including filing fees and fees and disbursements of counsel for the Underwriter
relating thereto, (vi) the filing fees of the Commission (and the National
Association of Securities Dealers, Inc.) relating to the Securities, and (vii)
the listing of the Securities on the New York Stock Exchange, (viii) meetings
with prospective investors in the Securities (other than shall have been
specifically approved in writing by the Underwriter to be paid for by the
Underwriter) and (ix) advertising relating to the offering of the Securities
(other than shall have been specifically approved in writing by the Underwriter
to be paid for by the Underwriter). If the sale of the Securities provided for
herein is not consummated because any condition to the obligations of the
Underwriter set forth in Section 7 hereof is not satisfied, because this
Agreement is terminated pursuant to Section 10 (other than Section 10(v))
hereof or because of any failure, refusal or inability on the part of the
Company to perform all obligations and satisfy all conditions on its part to be
performed or satisfied hereunder other than by reason of a default by the
Underwriter, the Company will reimburse the Underwriter upon demand for all
out-of-pocket expenses (including fees and disbursements of counsel) that shall
have been incurred by it in connection with the proposed purchase and sale of
the Securities. The Company shall not in any event be liable to the
Underwriter for the loss of anticipated profits from the transactions covered
by this Agreement.
7. Conditions of the Underwriter's Obligations. The
obligations of the
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Underwriter to purchase and pay for the Firm Securities shall be subject, in
the Underwriter's sole discretion, to the accuracy of the representations and
warranties contained in Section 2 hereof as of the date hereof and as of the
Firm Closing Date, as if made on and as of the Firm Closing Date, to the
accuracy of the statements of the Company's officers made pursuant to the
provisions hereof, to the performance by the Company of its covenants and
agreements hereunder and to the following additional conditions:
(a) The Prospectus, any Term Sheet that constitutes
a part thereof, any Integrated Prospectus or the Prospectus Supplement, as the
case may be, and any amendment or supplement thereto shall have been filed with
the Commission in the manner and within the time period required by Rules 434
and 424(b) under the Act; no stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment thereto and no order
directed at any document incorporated by reference in the Registration
Statement, the Prospectus or any Integrated Prospectus or any amendment or
supplement thereto shall have been issued and no proceedings for that purpose
shall have been instituted or threatened or, to the knowledge of the Company or
the Underwriter, shall be contemplated by the Commission; and the Company shall
have complied with any request of the Commission for additional information (to
be included in the Registration Statement, the Prospectus or any Integrated
Prospectus or otherwise).
(b) The Underwriter shall have received an opinion,
dated the Firm Closing Date, of Piper & Marbury, LLP, Maryland counsel for the
Company, to the effect that:
(i) the Company has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of the State of Maryland;
(ii) the Company has the corporate power to
own or lease its properties and conduct its businesses as described in
the Registration Statement and the Prospectus or any Integrated
Prospectus, and the Company has corporate power to enter into this
Agreement and to carry out all the terms and provisions hereof and
thereof to be carried out by it;
(iii) the Company has authorized, issued and
outstanding capitalization as set forth in each of the Prospectus or
any Integrated Prospectus; all of the issued shares of capital stock
of the Company have been duly authorized and validly issued and are
fully paid and nonassessable, were not issued in violation of or
subject to any preemptive rights or other rights to subscribe for or
purchase securities; the Firm Securities have been duly authorized by
all necessary corporate action of the Company, and when issued and
delivered to and paid for by the Underwriter pursuant to this
Agreement, will be validly issued, fully paid and nonassessable;
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(iv) the statements set forth under the
heading "Description of Common Stock" in each of the Prospectus and
any Integrated Prospectus, insofar as such statements purport to
summarize certain provisions of the capital stock of the Company,
provide a fair summary of such provisions; and the statements set
forth under the headings "Restrictions on Transfer of Capital Stock"
and "Certain Provisions of Maryland Law and of the Company's Articles
and Bylaws" in each of the Prospectus and any Integrated Prospectus,
insofar as such statements constitute a summary of the legal matters,
documents or proceedings referred to therein, provide a fair summary
of such legal matters, documents and proceedings;
(v) the execution and delivery of this
Agreement have been duly authorized by all necessary corporate action
of the Company; and
(vi) the issuance, offering and sale of the
Securities to the Underwriter by the Company pursuant to this
Agreement, the compliance by the Company with the other provisions of
this Agreement and the consummation of the other transactions herein
contemplated to do not conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a
default under the charter documents or bylaws of the Company.
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deems proper, on certificates of responsible
officers of the Company and public officials.
References to the Registration Statement and the Prospectus and any
Integrated Prospectus in this paragraph (b) shall include any amendment or
supplement thereto at the date of such opinion.
(c) The Underwriter shall have received an opinion,
dated the Firm Closing Date, of Xxxxxx, Xxxx & Xxxxxxxx LLP, counsel for the
Company, to the effect that:
(i) The LLC has been duly formed and is
validly existing in good standing under the laws of the State of
California. The Partnership has been duly formed and is validly
existing as a partnership in good standing under the laws of the State
of Delaware. The Company and the Subsidiaries are duly qualified to
transact business as a foreign entity, respectively, and are in good
standing under the laws of all other jurisdictions where the ownership
or leasing of their respective properties or the conduct of their
respective businesses requires such qualification, except where the
failure to be so qualified does not amount to a material liability or
disability to the
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Company and the Subsidiaries, taken as a whole;
(ii) the Subsidiaries have the power
(corporate and/or other) to own or lease their respective properties
and conduct their respective businesses as described in the
Registration Statement and the Prospectus or any Integrated
Prospectus;
(iii) the outstanding equity interests of
each Subsidiary have been duly authorized and validly issued, are
fully paid and nonassessable and, except as otherwise set forth in the
Prospectus and any Integrated Prospectus, are owned beneficially to
the extent shown in Exhibit A hereto by the Company free and clear of
any security interests perfected by possession or, to the best
knowledge of such counsel, any other security interests, liens,
encumbrances, equities or claims, except as otherwise disclosed in the
Prospectus Supplement;
(iv) no holders of outstanding shares of
capital stock of the Company are entitled as such to any preemptive or
other rights to subscribe for any of the Securities; and no holders of
securities of the Company are entitled to have such securities
registered under the Registration Statement;
(v) this Agreement has been duly executed
and delivered by the Company;
(vi) to the best knowledge of such counsel,
no legal or governmental proceedings are pending to which the Company
or any of the Subsidiaries are a party or to which the property of the
Company or any of the Subsidiaries is subject that are required to be
described in the Registration Statement, the Prospectus and any
Integrated Prospectus and are not described therein, and, to the best
knowledge of such counsel, no such proceedings have been threatened
against the Company or any of the Subsidiaries or with respect to any
of their respective properties;
(vii) the issuance, offering and sale of the
Securities to the Underwriter by the Company pursuant to this
Agreement, the compliance by the Company with the other provisions of
this Agreement and the consummation of the other transactions herein
contemplated do not (A) require the consent, approval, authorization,
registration or qualification of or with any governmental authority,
except such as have been obtained and such as may be required under
state securities or blue sky laws, or (B) conflict with or result in a
breach or violation of any of the terms and provisions of, or
constitute a default under, any indenture, mortgage, deed of trust,
lease or other agreement or instrument, known to such counsel, to
which the Company or any Subsidiary is a party or by which the Company
or any Subsidiary or any of their
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respective properties are bound, charter or bylaws of either of the
Subsidiaries, or any statute or any judgment, decree, order, rule or
regulation of any court or other governmental authority or any
arbitrator known to such counsel and applicable to the Company or any
of the Subsidiaries;
(viii) the Registration Statement is
effective under the Act; any required filing of the Prospectus, or any
Term Sheet that constitutes a part thereof, and any Integrated
Prospectus pursuant to Rules 434 and 424(b) has been made in the
manner and within the time period required by Rules 434 and 424(b);
and to the best knowledge of such counsel no stop order suspending the
effectiveness of the Registration Statement or any post-effective
amendment thereto and no order directed at any document incorporated
by reference in the Registration Statement, the Prospectus and any
Integrated Prospectus or any amendment or supplement thereto has been
issued, and no proceedings for that purpose have been instituted or
threatened or, are contemplated by the Commission;
(ix) the Registration Statement originally
filed with respect to the Securities and each amendment thereto and
any Rule 462(b) Registration Statement, the Prospectus and any
Integrated Prospectus (in each case, including the documents
incorporated by reference therein but not including the financial
statements, notes thereto and other financial information and
schedules contained therein, as to which such counsel need express no
opinion) comply as to form in all material respects with the
applicable requirements of the Act, the Exchange Act and the
respective rules and regulations of the Commission thereunder;
(x) if the Company elects to rely on Rule
434, the Prospectus is not "materially different," as such term is
used in Rule 434, from the prospectus included in the Registration
Statement at the time of its effectiveness or any effective
post-effective amendment thereto (including such information that is
permitted to be omitted pursuant to Rule 430A);
(xi) except as described in or contemplated
by the Registration Statement, the Prospectus and any Integrated
Prospectus, to the best knowledge of such counsel, there are no
outstanding securities of the Company convertible or exchangeable into
or evidencing the right to purchase or subscribe for any shares of
capital stock of the Company and there are no outstanding or
authorized options, warrants or rights of any character obligating the
Company to issue any shares of its capital stock or any securities
convertible or exchangeable into or evidencing the right to purchase
or subscribe for any shares of such stock; and except as described in
the Registration Statement, the Prospectus and any Integrated
Prospectus, to the best of knowledge of such counsel, no holder of any
securities of the Company
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or any other person has the right, contractual or otherwise, which has
not been satisfied or effectively waived, to cause the Company to sell
or otherwise issue to them, or to permit them to underwrite the sale
of, any of the Securities or the right to have any Common Stock or
other securities of the Company included in the Registration Statement
or the right, as a result of the filing of the Registration Statement,
to require registration under the Act of any shares of Common Stock or
other securities of the Company;
(xii) to such counsel's best knowledge there
are no contracts or documents required to be filed as exhibits to or
incorporated by reference in the Registration Statement or described
in the Registration Statement, the Prospectus and any Integrated
Prospectus which are not so filed, incorporated by reference or
described as required, and such contracts and documents as are
summarized in the Registration Statement or the Prospectus and any
Integrated Prospectus are fairly summarized in all material respects;
(xiii) the Company was organized in
conformity with the requirements for qualification as a REIT for
federal income tax purposes, and, based on the facts and assumptions
set forth in the Basic Prospectus, the Preliminary Prospectus and the
Prospectus Supplement and certain representations by the Company,
including but not limited to, those set forth in the Officer's
Certificate regarding certain federal income tax matters, its method
of operation has enabled it, and its proposed method of operation will
enable it, to meet the requirements under the Code for qualification
and taxation as a REIT; and
(xiv) The Company is not, and will not
become, as a result of the consummation of the transactions
contemplated by this Agreement, and application of the net proceeds
therefrom as described in the Prospectus and any Integrated
Prospectus, required to register as an investment company under the
1940 Act.
Such counsel shall also state that they have no reason to believe that the
Registration Statement, as of its effective date, contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not misleading or
that the Prospectus and any Integrated Prospectus, as of its date or the date
of such opinion, included or includes any 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.
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deems proper, on certificates of responsible
officers of the Company and public officials.
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References to the Registration Statement and the Prospectus and any
Integrated Prospectus in this paragraph (b) shall include any amendment or
supplement thereto at the date of such opinion.
(d) The Underwriter shall have received an opinion,
dated the Firm Closing Date, of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP,
counsel for the Underwriter, with respect to the Registration Statement, the
Prospectus or any Integrated Prospectus, and such other related matters as the
Underwriter may reasonably require, and the Company shall have furnished to
such counsel such documents as they may reasonably request for the purpose of
enabling them to pass upon such matters.
(e) The Underwriter shall have received from Ernst &
Young LLP, a letter or letters dated, respectively, the date hereof and the
Firm Closing Date, in form and substance satisfactory to the Underwriter, to
the effect that:
(i) they are independent accountants with
respect to the Company and the Subsidiaries within the meaning of the
Act, the Exchange Act and the applicable rules and regulations
thereunder;
(ii) in their opinion, the audited
consolidated financial statements and schedules examined by them and
included in the Registration Statement, the Prospectus and any
Integrated Prospectus comply in form in all material respects with the
applicable accounting requirements of the Act, the Exchange Act and
the related published rules and regulations thereunder;
(iii) on the basis of a reading of the
latest available interim unaudited consolidated [condensed] financial
statements of the Company and the Subsidiaries, carrying out certain
specified procedures (which do not constitute an examination made in
accordance with generally accepted auditing standards) that would not
necessarily reveal matters of significance with respect to the
comments set forth in this paragraph (iii), a reading of the minute
books of the shareholders, the board of directors and any committees
thereof of the Company and each of the Subsidiaries, and inquiries of
certain officials of the Company and the Subsidiaries who have
responsibility for financial and accounting matters, nothing came to
their attention that caused them to believe that:
(A) the unaudited consolidated financial statements
of the Company and the Subsidiaries included in the
Registration Statement, the Prospects and any Integrated
Prospectus do not comply as to form in all material respects
with the applicable accounting requirements of the Act, the
Exchange Act and the related published rules and regulations
thereunder, or are not in conformity with generally accepted
accounting principles applied on a basis substantially
consistent with that of the audited consolidated financial
statements included in
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the Registration Statement, the Prospectus and any Integrated
Prospectus;
(B) at a specific date not more than five business
days prior to the date of such letter, there were any changes
in the capital stock or long-term debt of the Company and the
Subsidiaries or any decreases in net current assets or
shareholders' equity of the Company and the Subsidiaries, in
each case compared with amounts shown on the September 30,
1996 unaudited consolidated balance sheet included in the
Registration Statement, the Prospectus and any Integrated
Prospectus, or for the period from October 1, 1996 to such
specified date there were any decreases, as compared with the
corresponding period in the preceding year, in sales, net
revenues, net income before income taxes or total or per share
amounts of net income of the Company and the Subsidiaries,
except in all instances for changes, decreases or increases
set forth in the Registration Statement, related Prospectus
Supplement or in such letter; and
(iv) they have carried out certain specified
procedures, not constituting an audit, with respect to certain amounts,
percentages and financial information that are derived from the general
accounting records of the Company and the Subsidiaries and are included
in the Registration Statement, the Prospectus and any Integrated
Prospectus and in Exhibit 12 to the Registration Statement, including
the information included or incorporated in the Company's most recent
Annual Report on Form 10-K under the captions "Business" (Item 1),
"Selected Financial Data" (Item 6) and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" (Item 7),
the information included or incorporated in the Company's Quarterly
Reports on Form 10-Q under the caption "Management's Discussion and
Analysis of Financial Condition and Results of Operations," Current
Report on Form 8-K, filed with the Commission on August 30, 1995 (as
amended by Form 8-K/A, filed with the Commission on October 27, 1995,
Form 8-K/A, filed with the Commission on May 8, 1996, and Form 8-K/A,
filed with the Commission on May 21, 1996); Current Report on Form
8-K, filed with Commission on November 28, 1995 (as amended by Form
8-K/A, filed with the Commission on May 8, 1996); Current Report on
Form 8-K, filed with the Commission on May 7, 1996 (as amended by Form
8-K/A, filed with the Commission on May 21, 1996); Current Report on
Form 8-K, filed with the Commission on May 8, 1996; Current Report on
Form 8-K, filed with the Commission on June 26, 1996; Current Report on
Form 8-K, filed with the Commission on November 8, 1996; Current Report
on Form 8-K, filed with the Commission on January 13, 1997; and Current
Report on Form 8-K, filed with the Commission on January 21, 1997.
With respect to the items identified in the beginning of this paragraph
having proved the mathematical accuracy, they make no representations
regarding the sufficiency of the aforementioned procedures for your
purposes and have compared such amounts, percentages and financial
information with such records and with information derived from such
records and have found them to be in agreement, excluding any questions
of legal interpretations; and
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(v) on the basis of a reading of the unaudited pro forma
consolidated condensed financial statements included in the
Registration Statement, the Prospectus and any Integrated Prospectus,
inquiries of certain officials of the Company and the Subsidiaries who
have responsibility for financial and accounting matters and proving
the arithmetic accuracy of the application of the pro forma
adjustments to the historical amounts in the unaudited pro forma
consolidated condensed financial statements, nothing came to their
attention that caused them to believe that the unaudited pro forma
consolidated condensed financial statements do not comply in form in
all material respects with the applicable accounting requirements of
Rule 11-02 of Regulation S-X or that the pro forma adjustments have
not been properly applied to the historical amounts in the compilation
of such statements.
In the event that the letters referred to above set forth any such
changes, decreases or increases, it shall be a further condition to the
obligations of the Underwriter that (A) such letters shall be accompanied by a
written explanation of the Company as to the significance thereof, unless the
Underwriter deems such explanation unnecessary, and (B) such changes, decreases
or increases do not, in the sole judgment of the Underwriter, make it
impractical or inadvisable to proceed with the purchase and delivery of the
Securities as contemplated by the Registration Statement, as amended as of the
date hereof.
References to the Registration Statement and the Prospectus and any
Integrated Prospectus in this paragraph (d) with respect to either letter
referred to above shall include any amendment or supplement thereto at the date
of such letter.
(f) The Underwriter shall have received a
certificate, dated the Firm Closing Date, of the Chief Executive Officer and
the Chief Financial Officer of the Company to the effect that:
(i) the representations and warranties of
the Company in this Agreement are true and correct as if made on and
as of the Firm Closing Date; the Registration Statement, as amended as
of the Firm Closing Date, does not include any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein not misleading, the Prospectus and any Integrated
Prospectus, as amended or supplemented as of the Firm Closing Date,
does not include any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; and the Company has performed all covenants and
agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the Firm Closing Date;
(ii) the Registration Statement has become
effective under the Act and no stop order suspending the effectiveness
of the Registration Statement or any post-effective amendment thereto
and no order
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directed at any document incorporated by reference in the Registration
Statement or the Prospectus or any amendment or supplement thereto has
been issued, and no proceedings for that purpose have been instituted
or threatened or, to the best of the Company's knowledge, are
contemplated by the Commission;
(iii) subsequent to the respective dates
as of which information is given in the Registration Statement, the
Prospectus and any Integrated Prospectus, none of the Company or any
of the Subsidiaries has sustained any material loss or interference
with their respective businesses or properties from fire, flood,
hurricane, accident or other calamity, whether or not covered by
insurance, except as to damage caused by recent storms on the West
Coast for which uninsured losses do not exceed $100,000, or from any
labor dispute or any legal or governmental proceeding, and there has
not been any material adverse change, or any development involving a
prospective material adverse change, in the condition (financial or
otherwise), management, business prospects, net worth or results of
operations of the Company or any of the Subsidiaries, except in each
case as described in or contemplated by the Prospectus and any
Integrated Prospectus; and
(iv) all filings required to have been made
pursuant to Rules 424 or 430A under the Act have been made.
(g) The Underwriter shall have received from each
person who is a director or officer of the Company an agreement to the effect
that such person will not, directly or indirectly, without the prior written
consent of the Underwriter, on behalf of the Underwriter, offer, sell, offer to
sell, contract to sell, pledge, grant any option to purchase or otherwise sell
or dispose (or announce any offer, sale, offer of sale, contract of sale,
pledge, grant of an option to purchase or other sale or disposition) of any
shares of Common Stock or any securities convertible into, or exchangeable or
exercisable for, shares of Common Stock for a period of 90 days after the date
of this Agreement.
(h) On or before the Firm Closing Date, the
Underwriter and counsel for the Underwriter shall have received such further
certificates, documents or other information as they may have reasonably
requested from the Company.
(i) Prior to the commencement of the offering of the
Securities, the Securities shall have been approved for listing on the New York
Stock Exchange, subject to official notice of issuance.
All opinions, certificates, letters and documents delivered pursuant
to this Agreement will comply with the provisions hereof only if they are
reasonably satisfactory in all material respects to the Underwriter and counsel
for the Underwriter. The Company shall furnish to the Underwriter such
conformed copies of such opinions, certificates, letters and documents in
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such quantities as the Underwriter and counsel for the Underwriter shall
reasonably request.
The obligations of the Underwriter to purchase and pay for any Option
Securities shall be subject, in its discretion, to each of the foregoing
conditions to purchase the Firm Securities, except that all references to the
Firm Securities and the Firm Closing Date shall be deemed to refer to such
Option Securities and the related Option Closing Date, respectively.
8. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold
harmless the Underwriter and each person, if any, who controls the Underwriter
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
against any losses, claims, damages or liabilities, joint or several, to which
the Underwriter or such controlling person may become subject under the Act,
the Exchange Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue
statement made by the Company in Section 2 of this Agreement,
(ii) any untrue statement or alleged untrue
statement of any material fact contained in (A) the Registration
Statement or any amendment thereto, any Preliminary Prospectus, the
Prospectus and any Integrated Prospectus or any amendment or
supplement thereto or (B) any application or other document, or any
amendment or supplement thereto, executed by the Company or any
Subsidiary or based upon written information furnished by or on behalf
of the Company filed in any jurisdiction in order to qualify the
Securities under the securities or blue sky laws thereof or filed with
the Commission or any securities association or securities exchange
(each an "Application"),
(iii) the omission or alleged omission to
state in the Registration Statement or any amendment thereto, any
Preliminary Prospectus, the Prospectus and any Integrated Prospectus
or any amendment or supplement thereto, or any Application a material
fact required to be stated therein or necessary to make the statements
therein not misleading, or
(iv) any untrue statement or alleged untrue
statement of any material fact contained in any audio or visual
materials used in connection with the marketing of the Securities,
including without limitation, slides, videos, films, tape recordings
and will reimburse, as incurred, the Underwriter and each such
controlling person for any legal or other expenses reasonably incurred by the
Underwriter or such controlling person in connection with investigating,
defending against or appearing as a third-party witness in
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connection with any such loss, claim, damage, liability or action; provided,
however, that the Company will not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon
any untrue statement or alleged untrue statement or omission or alleged
omission made in such registration statement or any amendment thereto, any
Preliminary Prospectus, the Prospectus and any Integrated Prospectus or any
amendment or supplement thereto, or any Application in reliance upon and in
conformity with written information furnished to the Company by the Underwriter
specifically for use therein. This indemnity agreement will be in addition to
any liability which the Company may otherwise have. The Company will not,
without the prior written consent of the Underwriter, settle or compromise or
consent to the entry of any judgment in any pending or threatened claim,
action, suit or proceeding in respect of which indemnification may be sought
hereunder (whether or not the Underwriter or any person who controls the
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act is a party to such claim, action, suit or proceeding), unless such
settlement, compromise or consent includes an unconditional release of the
Underwriter and such controlling persons from all liability arising out of such
claim, action, suit or proceeding.
(b) The Underwriter, will indemnify and hold
harmless the Company, each of its directors, each of its officers who signed
the Registration Statement and each person, it any, who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
against any losses, claims, damages or liabilities, joint and several, to which
the Company or any such director, officer or controlling person may become
subject under the Act, the Exchange Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon (i) any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement or any amendment thereto,
any Preliminary Prospectus, the Prospectus or any Integrated Prospectus or any
amendment or supplement thereto, or any Application or (ii) the omission or the
alleged omission to state therein a material fact required to be stated in the
Registration Statement or any amendment thereto, any Preliminary Prospectus,
the Prospectus or any amendment or supplement thereto, or any Application or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by the Underwriter
specifically for use therein; and, subject to the limitation set forth
immediately preceding this clause, will reimburse, as incurred, any legal or
other expenses reasonably incurred by the Company or any such director, officer
or controlling person in connection with investigating or defending any such
loss, claim, damage, liability or any action in respect thereof. This
indemnity agreement will be in addition to any liability which the Underwriter
may otherwise have.
(c) Promptly after receipt by an indemnified party
under this Section 8 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party of the
commencement thereof; but the omission so to notify the
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indemnifying party will not relieve it from any liability which it may have to
any indemnified party otherwise than under this Section 8. In case any such
action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party; provided,
however, that if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have
reasonably concluded that there may be one or more legal defenses available to
it and/or other indemnified parties which on the advice of counsel for the
indemnified party may conflict with those available to the indemnifying party,
the indemnifying party shall not have the right to direct the defense of such
action on behalf of such indemnified party or parties and such indemnified
party or parties shall have the right to select separate counsel to defend such
action on behalf of such indemnified party or parties. After notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof and approval by such indemnified party of counsel appointed to
defend such action, the indemnifying party will not be liable to such
indemnified party under this Section 8 for any legal or other expenses, other
than reasonable costs of investigation, subsequently incurred by such
indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that in
connection with such action the indemnifying party shall not be liable for the
expenses of more than one separate counsel (in addition to local counsel) in
any one action or separate but substantially similar actions in the same
jurisdiction arising out of the same general allegations or circumstances,
designated by the Underwriter in the case of paragraph (a) of this Section 8,
representing the indemnified parties under such paragraph (a) who are parties
to such action or actions) or (ii) the indemnifying party does not promptly
retain counsel satisfactory to the indemnified party or (iii) the indemnifying
party has authorized the employment of counsel for the indemnified party at the
expense of the indemnifying party. After such notice from the indemnifying
party to such indemnified party, the indemnifying party will not be liable for
the costs and expenses of any settlement of such action effected by such
indemnified party without the consent of the indemnifying party.
(d) In circumstances in which the indemnity
agreement provided for in the preceding paragraphs of this Section 8 is
unavailable or insufficient, for any reason, to hold harmless an indemnified
party in respect of any losses, claims, damages or liabilities (or actions in
respect thereof), each indemnifying party, in order to provide for just and
equitable contribution, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to reflect
(i) the relative benefits received by the indemnifying party or parties on the
one hand and the indemnified party on the other from the offering of the
Securities or (ii) if the allocation provided by the foregoing clause (i) is
not permitted by applicable law, not only such relative benefits but also the
relative fault of the indemnifying party or parties on the one hand and the
indemnified party on the other in connection with the statements or omissions
or alleged statements or omissions that resulted in such losses, claims,
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damages or liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriter on the other shall be deemed to be
in the same proportion as the total proceeds from the offering (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by the Underwriter. The relative fault of the parties
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company or the
Underwriter, the parties' relative intents, knowledge, access to information and
opportunity to correct or prevent such statement or omission, and any other
equitable considerations appropriate in the circumstances. The Company and the
Underwriter agree that it would not be equitable if the amount of such
contribution were determined by pro rata or per capita allocation or by any
other method of allocation that does not take into account the equitable
considerations referred to above in this paragraph (d). Notwithstanding any
other provision of this paragraph (d), the Underwriter shall not be obligated to
make contributions hereunder that in the aggregate exceed the total public
offering price of the Securities purchased by the Underwriter under this
Agreement, less the aggregate amount of any damages that the Underwriter has
otherwise been required to pay in respect of the same or any substantially
similar claim, and no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes of
this paragraph (d), each person, if any, who controls the Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act shall have
the same rights to contribution as the Underwriter, and each director 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 Act or Section 20 of the Exchange Act, shall have the same rights to
contribution as the Company.
9. Survival. The respective representations, warranties,
agreements, covenants, indemnities and other statements of the Company, its
officers and the Underwriter set forth in this Agreement or made by or on behalf
of them, respectively, pursuant to this Agreement shall remain in full force and
effect, regardless of (i) any investigation made by or on behalf of the Company
or any Subsidiary, any of its officers or directors, the Underwriter or any
controlling person referred to in Section 8 hereof and (ii) delivery of and
payment for the Securities. The respective agreements, covenants, indemnities
and other statements set forth in Sections 6 and 8 hereof shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement.
10. Termination. (a) This Agreement may be terminated with
respect to the Firm Securities or any Option Securities in the sole discretion
of the Underwriter by notice to the Company given prior to the Firm Closing Date
or the related Option Closing Date, respectively, in the event that the Company
shall have failed, refused or been unable to perform all obligations and satisfy
all conditions on its part to be performed or satisfied hereunder at or prior
thereto or, if at or prior to the Firm Closing Date or such Option Closing Date,
respectively,
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(i) the Company and the Subsidiaries as a
whole shall have, in the sole judgment of the Underwriter, sustained
any material loss or interference with its businesses or properties
from fire, flood, hurricane, accident or other calamity, whether or
not covered by insurance, except as to damage caused by recent storms
on the West Coast for which uninsured losses do not exceed $100,000,
or from any labor dispute or any legal or governmental proceeding or
there shall have been any material adverse change, or any development
involving a prospective material adverse change (including without
limitation a change in management or control of the Company), in the
condition (financial or otherwise), business prospects, net worth or
results of operations of the Company and its subsidiaries, except in
each case as described in or contemplated by the Prospectus (exclusive
of any amendment or supplement thereto);
(ii) trading in the Common Stock shall have
been suspended by the Commission or the New York Stock Exchange;
(iii) trading in securities generally on the
New York Stock Exchange shall have been suspended or minimum or
maximum prices shall have been established on such exchange;
(iv) a banking moratorium shall have been
declared by California, Maryland, New York or United States
authorities; or
(v) there shall have been (A) an outbreak or
escalation of hostilities between the United States and any foreign
power, (B) an outbreak or escalation of any other insurrection or
armed conflict involving the United States or (C) any other calamity
or crisis or material adverse change in general economic, political or
financial conditions having an effect on the U. S. financial markets
that, in the judgment of the Underwriter, makes it impractical or
inadvisable to proceed with the public offering or the delivery of the
Securities as contemplated by the Registration Statement, as amended
as of the date hereof.
(b) Termination of this Agreement pursuant to this
Section 10 shall be without liability of any party to any other party except as
provided in Section 9 hereof.
11. Information Supplied by Underwriter. The statements set
forth in the last paragraph on the front cover page and under the heading
"Underwriting" in any Preliminary Prospectus, the Prospectus or any Integrated
Prospectus (to the extent such statements relate to the Underwriter) constitute
the only information furnished by the Underwriter to the Company for the
purposes of Sections 2(b) and 8 hereof. The Underwriter confirms that such
statements (to such extent) are correct.
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12. Notices. All communications hereunder shall be in
writing and, if sent to any of the Underwriter, shall be delivered or sent by
mail, telex or facsimile transmission and confirmed in writing to Prudential
Securities Incorporated, Xxx Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Equity Transactions Group; and if sent to the Company, shall be
delivered or sent by mail, telex or facsimile transmission and confirmed in
writing to the Company at 000 Xxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxx Xxxxx,
Xxxxxxxxxx 00000-0000, Attention: Xxxxx X. Xxxxxxxxx.
13. Successors. This Agreement shall inure to the benefit of
and shall be binding upon the Underwriter, the Company and their respective
successors and legal representatives, and nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any other person any
legal or equitable right, remedy or claim under or in respect of this
Agreement, or any provisions herein contained, this Agreement and all
conditions and provisions hereof being intended to be and being for the sole
and exclusive benefit of such persons and for the benefit of no other person
except that (i) the indemnities of the Company contained in Section 8 of this
Agreement shall also be for the benefit of any person or persons who control
the Underwriter within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act and (ii) the indemnities of the Underwriter contained in
Section 8 of this Agreement shall also be for the benefit of the directors of
the Company, the officers of the Company who have signed the Registration
Statement and any person or persons who control the Company within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act. No purchaser of
Securities from the Underwriter shall be deemed a successor because of such
purchase.
14. Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, AS
APPLIED TO CONTRACTS MADE AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK,
EXCLUDING (TO THE GREATEST EXTENT PERMISSIBLE BY LAW) ANY RULE OF LAW THAT
WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE
STATE OF NEW YORK. THE COMPANY, ON BEHALF OF ITSELF AND THE SUBSIDIARIES,
HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF ANY NEW YORK STATE
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY
FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN
RESPECT OF ANY SUIT, ACTION OR PROCEEDING RELATED TO THIS AGREEMENT OR ANY OF
THE MATTERS CONTEMPLATED HEREBY IRREVOCABLY WAIVES ANY DEFENSE OF LACK OF
PERSONAL JURISDICTION AND IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY
SUIT, ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT. THE
COMPANY, ON BEHALF OF ITSELF AND THE SUBSIDIARIES, IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION
THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH
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SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY
SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN
AN INCONVENIENT FORUM.
15. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute an agreement binding the Company and the
Underwriter.
Very truly yours,
PACIFIC GULF PROPERTIES INC.
By: /s/ XXXXX X. XXXXXXXXX
----------------------------
Xxxxx X. Xxxxxxxxx
Chief Executive Officer and
President
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
PRUDENTIAL SECURITIES INCORPORATED
By: /s/ XXXX-XXXXXX CANFIN
--------------------------------------
Xxxx-Xxxxxx Canfin
Director
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EXHIBIT A
Ownership of PGP Inland Communities, L.P.
At least 78 % ownership by the Company.
Ownership of Pacific Inland Communities, LLC
As reflected in the Articles of Organization and in the Operating
Agreement for Pacific Inland Communities, LLC, a California Limited
Liability Company.
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