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EXHIBIT 1.1
STRATEGIC TIMBER TRUST, INC.
16,600,000 Shares(1)
Common Stock
($.01 par value)
Underwriting Agreement
New York, New York
, 1999
Xxxxxxx Xxxxx Xxxxxx
Credit Suisse First Boston Corporation
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
X.X. Xxxxxxx & Sons, Inc.
Warburg Dillon Read LLC
ABN AMRO Incorporated
Xxxxxx Xxxxxx & Company, Inc.
As Representatives of the several Underwriters,
c/o Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Strategic Timber Trust, Inc., a corporation organized under the laws of
the State of Georgia (the "Company"), proposes to sell to the several
underwriters named in Schedule I hereto (the "Underwriters"), for whom you (the
"Representatives") are acting as representatives, 16,600,000 shares of Common
Stock, $.01 par value ("Common Stock"), of the Company (said shares to be issued
and sold by the Company being hereinafter called the "Underwritten Securities").
The Company also proposes to grant to the Underwriters an option to purchase up
to 2,490,000 additional shares of Common Stock to cover over-allotments (the
"Option Securities"; the Option Securities, together with the Underwritten
Securities, being hereinafter called the "Securities"). To the extent there are
no additional Underwriters listed on Schedule I other than you, the term
Representatives as used herein shall mean you, as Underwriters, and the terms
Representatives and Underwriters shall mean either the singular or plural as the
context requires. Certain terms used herein are defined in Section 17 hereof.
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(1) Plus an option to purchase from the Company, up to 2,490,000
additional Securities to cover over-allotments.
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As part of the offering contemplated by this Agreement, Xxxxxxx Xxxxx
Xxxxxx ("Xxxxxxx Xxxxx Xxxxxx") has agreed to reserve out of the Securities set
forth opposite its name on the Schedule I to this Agreement, up to
___________________shares, for sale to the Company's employees, officers and
directors (collectively, "Participants") (the "Directed Share Program"). The
Shares to be sold by Xxxxxxx Xxxxx Barney pursuant to the Directed Share Program
(the "Directed Shares") will be sold by Xxxxxxx Xxxxx Xxxxxx pursuant to this
Agreement at the public offering price. Any Directed Shares not orally confirmed
for purchase by any Participants by the end of the business day on which this
Agreement is executed will be offered to the public by Xxxxxxx Xxxxx Barney as
set forth in the Prospectus.
At or prior to the Closing Date (as defined herein), the Company,
Strategic Timber Partners, LP, a Delaware limited partnership (the
"Partnership"), and certain predecessor entities will complete a series of
transactions described in the Prospectus under the caption "Structure and
Formation of Strategic Timber". As part of these transactions, (i) the
Partnership will obtain ownership, directly or through Pioneer Resources, LLC,
an Oregon limited liability company ("Pioneer"), of approximately 448,000 acres
of timberlands (the "Timberlands") and certain other properties (together with
the Timberlands, the "Properties"), (ii) certain members of the Company's
management and certain other investors (the "Continuing Investors") will receive
an aggregate of 4,966,205 limited partnership interests ("Units") in the
Partnership and an aggregate of 671,770 shares of Common Stock and approximately
$47 million in cash, (iii) Strategic Timber Partners II, LP, a Georgia limited
partnership ("STP2"), Strategic Timber Trust II, LLC, a Georgia limited
liability company ("STT2"), and Strategic Timber Two Operating Co., LLC, a
Georgia limited liability company ("STTOC"), will be merged into the
Partnership, leaving Pioneer as a wholly owned subsidiary of the Partnership,
(iv) the Company will sell 16,600,000 shares of Common Stock and contribute
approximately $186.4 million of the net proceeds in exchange for 76.7% of the
limited partnership Units in the Partnership and approximately 1.0% of the
general partnership Units in the Partnership which will be held by Strategic
Timber Operating Co., a corporation organized under the laws of the State of
Delaware ("STOC"), (v) the Company will apply approximately $120 million of the
net proceeds from the sale of the Securities to the payment of outstanding
indebtedness and (vi) the Partnership will apply the remainder of the net
proceeds, together with amounts drawn under its new credit facility to be
implemented as of the Closing Date (the "New Credit Facility"), as described
under the caption "Use of Proceeds" in the Prospectus. To the extent any portion
of the over-allotment option is exercised at the Closing Date, the relevant
share numbers and percentages set forth in this paragraph will be adjusted
accordingly. Additionally, to the extent any portion of the over-allotment
option is exercised subsequent to the Closing Date, the Company will contribute
the proceeds from the sale of the Option Securities to the Partnership in
exchange for an equivalent number of Units. As used herein, the term "Formation
Transactions" shall mean the occurrence of the events described in this
paragraph and the transactions related thereto.
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1. Representations and Warranties. Each of the Company and the
Partnership, jointly and severally, represents and warrants to, and agrees with,
each Underwriter as set forth below in this Section 1.
(a) The Company has prepared and filed with the Commission a
registration statement (file number 333-71291) on Form S-11, including
a related preliminary prospectus, for registration under the Act of the
offering and sale of the Securities. The Company may have filed one or
more amendments thereto, including a related preliminary prospectus,
each of which has previously been furnished to you. The Company will
file with the Commission either (1) prior to the Effective Date of such
registration statement, a further amendment to such registration
statement (including the form of final prospectus) or (2) after the
Effective Date of such registration statement, a final prospectus in
accordance with Rules 430A and 424(b). In the case of clause (2), the
Company has included in such registration statement, as amended at the
Effective Date, all information (other than Rule 430A Information)
required by the Act and the rules thereunder to be included in such
registration statement and the Prospectus. As filed, such amendment and
form of final prospectus, or such final prospectus, shall contain all
Rule 430A Information, together with all other such required
information, and, except to the extent the Representatives shall agree
in writing to a modification, shall be in all substantive respects in
the form furnished to you prior to the Execution Time or, to the extent
not completed at the Execution Time, shall contain only such specific
additional information and other changes (beyond that contained in the
latest Preliminary Prospectus) as the Company has advised you, prior to
the Execution Time, will be included or made therein.
(b) On the Effective Date, the Registration Statement did or
will, and when the Prospectus is first filed (if required) in
accordance with Rule 424(b) and on the Closing Date and on any date on
which Option Securities are purchased, if such date is not the Closing
Date (a "Settlement Date"), the Prospectus (and any supplements
thereto) will, comply in all material respects with the applicable
requirements of the Act and the rules thereunder; on the Effective Date
and at the Execution Time, the Registration Statement did not or will
not contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order
to make the statements therein not misleading; and, on the Effective
Date, the Prospectus, if not filed pursuant to Rule 424(b), will not,
and on the date of any filing pursuant to Rule 424(b) and on the
Closing Date and any Settlement Date, the Prospectus (together with any
supplement thereto) will not, 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; provided, however, that the
Company makes no representations or warranties as to the information
contained in or omitted from the Registration Statement, or the
Prospectus (or any supplement thereto) in reliance upon and in
conformity with information furnished in writing to the Company by or
on behalf of any Underwriter through the Representatives specifically
for inclusion in the Registration Statement or the Prospectus (or any
supplement thereto).
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(c) Each of the Company and STOC has been duly organized and
is validly existing as a corporation in good standing under the laws of
the jurisdiction in which it is chartered with full corporate power and
authority to own or lease, as the case may be, and to operate its
properties and conduct its business as described in the Prospectus, and
is duly qualified to do business as a foreign corporation and is in
good standing under the laws of each jurisdiction where it owns or
leases material properties or conducts material business and where the
failure to be so qualified would, individually or in the aggregate,
have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company
or STOC. Except with respect to the Partnership and STOC, the Company
owns no material amounts of stock or other beneficial interest in any
corporation, partnership, joint venture or other business entity.
(d) Each of Pioneer, STT2 and STTOC has been duly organized
and is validly existing as a limited liability company in good standing
under the laws of the jurisdiction in which it is organized with full
limited liability company power and authority to own or lease, as the
case may be, and to operate its properties and conduct its business as
described in the Prospectus, and is duly qualified to do business as a
foreign company and is in good standing under the laws of each
jurisdiction where it owns or leases material properties or conducts
material business and where the failure to be so qualified would,
individually or in the aggregate, have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or
properties of Pioneer, STT2 or STTOC, as the case may be. Upon
consummation of the Formation Transactions, the Partnership will own
all of the member interests in Pioneer and such member interests will
have been duly authorized and validly issued and will be fully paid and
nonassessable and will be owned by the Partnership, free and clear of
any perfected security interest or any other security interests,
claims, liens or encumbrances.
(e) The Second Amended and Restated Agreement of Limited
Partnership of the Partnership (the "Partnership Agreement") has been
duly and validly authorized, executed and delivered by STOC and the
Company and is a valid and binding agreement of STOC and the Company
enforceable in accordance with its terms. The Partnership has been duly
formed and is validly existing as a limited partnership in good
standing under the laws of the State of Delaware with full partnership
power and authority to own or lease, as the case may be, and to operate
its properties and conduct its business as described in the Prospectus
and is duly qualified or registered as a foreign partnership and is in
good standing in each jurisdiction where it owns or leases material
properties or conducts material business and where the failure to be so
qualified would, individually or in the aggregate, have a material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Partnership. STOC is, and,
immediately after the Closing Date, will be, the sole general partner
of the Partnership. Immediately after the Closing Date, the Company,
directly or through STOC, will be the holder of approximately 77.7% of
the Units, if the over-allotment option is not exercised. The
Partnership has no subsidiaries other than Pioneer.
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(f) All the outstanding shares of capital stock of STOC have
been duly and validly authorized and issued and are fully paid and
nonassessable, and are owned by the Company free and clear of any
perfected security interest or any other security interests, claims,
liens or encumbrances.
(g) The Company's authorized equity capitalization is as set
forth in the Prospectus; the capital stock of the Company conforms in
all material respects to the description thereof contained in the
Prospectus; the outstanding shares of Common Stock have been duly and
validly authorized and issued and are fully paid and nonassessable; the
Securities have been duly and validly authorized, and, when issued and
delivered to and paid for by the Underwriters pursuant to this
Agreement, will be fully paid and nonassessable; the Securities are
duly listed, and admitted and authorized for quotation, subject to
official notice of issuance and evidence of satisfactory distribution,
on the NASDAQ National Market; the certificates for the Securities are
in valid and sufficient form; the Company has duly reserved a
sufficient number of shares of Common Stock for issuance upon exchange
of outstanding Units in the Partnership; the holders of outstanding
shares of capital stock of the Company are not entitled to preemptive
or other rights to subscribe for the Securities; and, except as set
forth in the Prospectus, no options, warrants or other rights to
purchase, agreements or other obligations to issue, or rights to
convert any obligations into or exchange any securities for, shares of
capital stock or Units of or ownership interests in the Company or the
Partnership are outstanding.
(h) The Units to be issued in connection with the Formation
Transactions, including, without limitation, the Units to be issued to
the Company and STOC, have been duly authorized for issuance by the
Partnership to the holders or prospective holders thereof, and on the
Closing Date will be validly issued, fully paid, nonassessable and
owned in the percentage amounts set forth in the Prospectus by the
Company and STOC and by the entities or persons described in the
Prospectus, free and clear of any perfected security interest or any
other security interests, claims, liens or encumbrances. Immediately
after the Closing Date and not including any Units issued in exchange
for proceeds received by the Company in connection with the sale of the
Option Securities, 22,237,975 Units will be issued and outstanding. The
Units have been and will be offered and sold at or prior to the Closing
Date in compliance with all applicable laws (including, without
limitation, federal and state securities laws).
(i) Consummation of each of the Formation Transactions and
compliance by the Company, Pioneer, XXXX, XXX0, XXXXX, XXX0, the
Partnership and the Continuing Investors with their respective
obligations under each of the documents relating to the Formation
Transactions (collectively, the "Transaction Documents") have been duly
authorized by all necessary corporate, partnership or limited liability
company action, as the case may be, and did not and will not violate or
conflict with or constitute a breach of, or default under, or result in
the creation or imposition of any lien, charge or encumbrance upon any
of the Properties or any other properties or assets of the Company,
Pioneer, XXXX, XXX0, XXXXX, XXX0, the Partnership or the Continuing
Investors
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pursuant to any indenture, contract, lease, mortgage, deed of trust,
note agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument, including, without limitation, any
partnership agreement to which the Company, Pioneer, XXXX, XXX0, XXXXX,
XXX0, the Partnership or any of the Continuing Investors is or was a
party or by which it or any of them may be bound or affected, or to
which any of the Properties or any other properties or assets of the
Company, Pioneer, XXXX, XXX0, XXXXX, XXX0, the Partnership or any of
the Continuing Investors is subject, except pursuant to indentures,
contracts, leases, mortgages, deeds of trust, note agreements, loan
agreements or other agreements, obligations, conditions, covenants or
instruments which shall be paid in full or terminated as of the Closing
Date; none of the Formation Transactions resulted or will result in the
violation of any provisions of the charter, bylaws, articles of
organization or operating agreement of the Company, Pioneer, XXXX,
XXX0, XXXXX, or any Continuing Investor or any agreement, certificate
of limited partnership or other governing document of the Partnership,
STP2 or any Continuing Investor or any applicable law, administrative
regulation or administrative or court decree; and all authorizations,
consents and approvals necessary to consummate the Formation
Transactions were, or as of the Closing Date will be, timely obtained;
and the offer, issuance and exchange of the general and limited
partnership interests in the Partnership will be exempt from the
registration requirements of the Act and applicable state securities
and blue sky laws. On or prior to the Closing Date, each of the
Formation Transactions will have occurred in the manner described in
the Prospectus under the caption "Structure and Formation of Strategic
Timber."
(j) Each of the Transaction Documents to which the Company,
the Partnership, any Continuing Investor, Pioneer, XXXX, XXX0, XXXXX,
XXX0 or any affiliate of any such entity is a party has been duly
authorized, executed and delivered by such party and constitutes the
binding agreement of such party, enforceable against such party in
accordance with its terms, except as such enforceability may be limited
by bankruptcy, insolvency, reorganization or other similar laws
affecting creditors' rights generally and by general principles of
equity.
(k) The Company will be organized in conformity with the
requirements for qualification as a real estate investment trust under
the Internal Revenue Code of 1986, as amended (the "Code"), and its
operations to date and proposed method of operation will enable it to
meet the requirements for taxation as a real estate investment trust
under the Code commencing with the Company's taxable year ending
December 31, 1998.
(l) The Company, STOC, Pioneer and the Partnership own,
possess, license or have other rights to use, on reasonable terms, all
patents, patent applications, trade and service marks, trade and
service xxxx registrations, trade names, copyrights, licenses,
inventions, trade secrets, technology, know-how and other intellectual
property (collectively, the "Intellectual Property") necessary for the
conduct of their respective businesses as now conducted or as proposed
in the Prospectus to be conducted. There is no pending or threatened
action, suit, proceeding or claim by others challenging the rights
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of the Company, STOC, Pioneer or the Partnership in or to any such
Intellectual Property, and neither the Company nor the Partnership is
aware of any facts which would form a reasonable basis for any such
claim. There is no pending or threatened action, suit, proceeding or
claim by others challenging the validity or scope of any such
Intellectual Property, and neither the Company nor the Partnership is
aware of any facts which would form a reasonable basis for any such
claim. There is no pending or threatened action, suit, proceeding or
claim by others that the Company, STOC, Pioneer or the Partnership
infringes or otherwise violates any patent, trademark, copyright, trade
secret or other proprietary rights of others, and neither the Company
nor the Partnership is aware of any other fact which would form a
reasonable basis for any such claim.
(m) There is no franchise, contract or other document of a
character required to be described in the Registration Statement or
Prospectus, or to be filed as an exhibit thereto, which is not
described or filed as required; and the statements in the Prospectus
under the headings "Federal Income Tax Consequences," "ERISA
Considerations," "Description of Capital Stock of the Strategic
Timber," "Policies With Respect to Certain Activities," "Structure and
Formation of the Strategic Timber," "Transactions with Related
Parties," "The Partnership Agreement," "Certain Provisions of Georgia
Law and Strategic Timber's Articles of Incorporation and Bylaws That
May Have an Anti-Takeover Effect," "Shares Available For Future Sale"
and "Business and Properties - Federal and State Regulations" and "-
Legal Proceedings" fairly summarize the matters therein described.
(n) This Agreement has been duly authorized, executed and
delivered by each of the Company and the Partnership and constitutes a
valid and binding obligation of the Company and the Partnership
enforceable in accordance with its terms.
(o) None of the Company, Pioneer, STOC or the Partnership is,
and, after giving effect to the offering and sale of the Securities and
the application of the proceeds thereof as described in the Prospectus,
none of the Company, Pioneer, STOC or the Partnership will be, an
"investment company" or an entity "controlled by" an "investment
company" as defined in the Investment Company Act of 1940, as amended.
(p) No consent, approval, authorization, filing with or order
of any court or governmental agency or body is required in connection
with the transactions contemplated herein, except such as have been
obtained under the Act and such as may be required under the blue sky
laws of any jurisdiction in connection with the purchase and
distribution of the Securities by the Underwriters in the manner
contemplated herein and in the Prospectus.
(q) Neither the issue and sale of the Securities nor the
consummation of any other of the transactions herein contemplated nor
the fulfillment of the terms hereof will conflict with, result in a
breach or violation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company, STOC, Pioneer or the
Partnership pursuant to, (i) the charter or by-laws of the Company or
STOC or the articles
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of organization or operating agreement of Pioneer, (ii) the Partnership
Agreement, (iii) the terms of any indenture, contract, lease, mortgage,
deed of trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which the Company,
STOC, Pioneer or the Partnership is a party or bound or to which its or
their property is subject, or (iv) any statute, law, rule, regulation,
judgment, order or decree applicable to the Company, Pioneer, STOC or
the Partnership of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having jurisdiction
over the Company, Pioneer, STOC or the Partnership or any of their
properties.
(r) No holders of securities of the Company or the Partnership
have rights to the registration of such securities except as set forth
in the Prospectus.
(s) The financial statements and schedules included in the
Prospectus and the Registration Statement present fairly in all
material respects the financial condition, results of operations and
cash flows of the respective entity or entities therein as of the dates
and for the periods indicated, comply as to form with the applicable
accounting requirements of the Act and have been prepared in conformity
with generally accepted accounting principles applied on a consistent
basis throughout the periods involved. The selected financial
information set forth under the caption "Selected Historical Financial
and Operating Information" in the Prospectus and Registration Statement
fairly presents, on the basis stated in the Prospectus and the
Registration Statement, the information included therein. The pro forma
financial statements included in the Prospectus and the Registration
Statement include assumptions that provide a reasonable basis for
presenting the significant effects directly attributable to the
transactions and events described therein, and the related pro forma
adjustments give appropriate effect to those assumptions. The pro forma
financial statements included in the Prospectus and the Registration
Statement comply as to form in all material respects with the
applicable accounting requirements of Regulation S-X under the Act and
the pro forma adjustments have been properly applied to the historical
amounts in the compilation of those statements.
(t) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company, the Partnership, STOC or Pioneer or its or their property is
pending or, to the best knowledge of the Company and the Partnership,
threatened that (i) could reasonably be expected to have a material
adverse effect on the performance of this Agreement or the consummation
of any of the transactions contemplated hereby or (ii) could reasonably
be expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or properties
of the Company, the Partnership, STOC or Pioneer, whether or not
arising from transactions in the ordinary course of business, except as
set forth in or contemplated in the Prospectus (exclusive of any
supplement thereto).
(u) Neither the Company nor STOC is in violation or default of
any provision of its charter or bylaws; Pioneer is not in violation or
default of its articles of organization
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or operating agreement; and the Partnership is not in violation of the
Partnership Agreement. None of the Company, STOC, Pioneer or the
Partnership is in violation or default of (i) the terms of any
indenture, contract, lease, mortgage, deed of trust, note agreement,
loan agreement or other agreement, obligation, condition, covenant or
instrument to which it is a party or bound or to which its property is
subject, or (ii) any statute, law, rule, regulation, judgment, order or
decree of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having jurisdiction
over the Company, STOC, Pioneer or the Partnership or any of their
respective properties, as applicable, which violations or defaults
would have a material adverse effect on the condition (financial or
otherwise), prospects, business, earnings or properties of the Company,
STOC, Pioneer or the Partnership.
(v) Xxxxxx Xxxxxxxx LLP, who have certified certain financial
statements and delivered their report with respect to such audited
consolidated financial statements and schedules included in the
Prospectus, are independent public accountants within the meaning of
the Act and the applicable published rules and regulations thereunder.
(w) There are no transfer taxes or other similar fees or
charges under federal law or the laws of any state, or any political
subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance by the Company
or sale by the Company of the Securities.
(x) Each of the Company, STOC, the Partnership and Pioneer has
filed all foreign, federal, state and local tax returns that are
required to be filed or has requested extensions thereof (except in any
case in which the failure so to file would not have a material adverse
effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company, STOC, Pioneer and the
Partnership, taken as a whole, whether or not arising from transactions
in the ordinary course of business, except as set forth in or
contemplated in the Prospectus (exclusive of any supplement thereto)
and has paid all taxes required to be paid by it and any other
assessment, fine or penalty levied against it, 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
would not have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company,
STOC, Pioneer and the Partnership, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as
set forth in or contemplated in the Prospectus (exclusive of any
supplement thereto).
(y) No labor problem or dispute with the employees of the
Company, Pioneer or the Partnership exists or is threatened or
imminent, and neither the Partnership nor the Company is aware of any
existing or imminent labor disturbance by the employees of any of the
principal suppliers, contractors or customers of the Company, the
Partnership or Pioneer, that could have a material adverse effect on
the condition (financial or otherwise), prospects, earnings, business
or properties of the Company, STOC, Pioneer
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and the Partnership, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in
or contemplated in the Prospectus (exclusive of any supplement
thereto).
(z) The Company, Pioneer, STOC and the Partnership 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; all policies of insurance
insuring the Company, Pioneer, STOC or the Partnership or their
respective businesses, assets, employees, officers and directors and
managers are in full force and effect; the Company, Pioneer, STOC and
the Partnership are in compliance with the terms of such policies and
instruments in all material respects; and there are no claims by the
Company, Pioneer, STOC or the Partnership under any such policy or
instrument as to which any insurance company is denying liability or
defending under a reservation of rights clause; none of the Company,
Pioneer, STOC or the Partnership has been refused any insurance
coverage sought or applied for; and none of the Company, Pioneer, STOC
or the Partnership has any reason to believe that it will not be able
to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may be
necessary to continue its business at a cost that would not have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company, Pioneer,
STOC and the Partnership, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in
or contemplated in the Prospectus (exclusive of any supplement
thereto).
(aa) None of Pioneer, the Partnership or STOC is currently
prohibited, directly or indirectly, from paying any dividends to the
Company, from making any other distribution on its membership
interests, partnership interests or capital stock, from repaying to the
Company any loans or advances to Pioneer or the Partnership or STOC
from the Company or from transferring any of their property or assets
to the Company or any other subsidiary of the Company, except as
described in or contemplated by the Prospectus.
(bb) The Company, STOC, Pioneer and the Partnership possess,
and operate in compliance in all material respects with, all licenses,
certificates, permits and other authorizations issued by the
appropriate federal, state or foreign regulatory authorities necessary
to conduct their respective businesses, and none of the Company, STOC,
Pioneer or the Partnership 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 have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company, STOC,
Pioneer and the Partnership, taken as a whole, whether or not arising
from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus (exclusive of any supplement
thereto).
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(cc) Xxx Xxxxxxx, XXXX, Xxxxxxx, XXX0 and the Partnership
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; and
(iv) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(dd) None of the Continuing Investors, the Partnership or the
Company or any of its officers, directors or controlling persons has
taken, directly or indirectly, any action designed to or which has
constituted or which might reasonably be expected to cause or result,
under the Exchange Act or otherwise, in stabilization or manipulation
of the price of any security of the Company to facilitate the sale or
resale of the Securities.
(ee) The Company, Pioneer, XXXX, XXX0, XXXXX, XXX0 and the
Partnership are (i) in compliance with any and all applicable foreign,
federal, state and local laws and regulations relating to the
protection of human health and safety, the environment or hazardous or
toxic substances or wastes, pollutants or contaminants ("Environmental
Laws"), (ii) have received and are in compliance with all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii)
have not received notice of any actual or potential liability for the
investigation or remediation of any disposal or release of hazardous or
toxic substances or wastes, pollutants or contaminants, except where
such non-compliance with Environmental Laws, failure to receive
required permits, licenses or other approvals, or liability would not,
individually or in the aggregate, have a material adverse change in the
condition (financial or otherwise), prospects, earnings, business or
properties of the Company, Pioneer, the Partnership and STOC, taken as
a whole, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the
Prospectus (exclusive of any supplement thereto). None of the Company,
the Partnership, Pioneer, XXXX, XXX0, XXXXX, XXX0 or any of the
Continuing Investors has been named as a "potentially responsible
party" under the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, as amended.
(ff) In the ordinary course of its business, the Company and
the Partnership periodically review the effect of Environmental Laws on
the business, operations and properties of the Company, STOC, Pioneer
and the Partnership, in the course of which they identify and evaluate
associated costs and liabilities (including, without limitation, any
capital or operating expenditures required for clean-up, 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). On the basis of such
review, the Company and the Partnership have reasonably concluded that
such associated costs and liabilities would not, singly or in the
aggregate, have a material
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adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company, STOC, Pioneer and the
Partnership, taken as a whole, whether or not arising from transactions
in the ordinary course of business, except as set forth in or
contemplated in the Prospectus (exclusive of any supplement thereto).
(gg) (i) Upon consummation of the Formation Transactions, the
Partnership and Pioneer will have good and marketable title in fee
simple to all real property and improvements to be transferred to them
pursuant to the Transaction Documents, including, but not limited to,
the Properties, in each case free and clear of all liens, encumbrances
and defects other than those that are described in the Prospectus or
those which do not and will not materially affect the value of such
property or materially interfere with the use made and proposed to be
made of such property by the Partnership or Pioneer; (ii) all liens,
charges, encumbrances, claims, or restrictions on or affecting the
properties and assets to be held by the Partnership and Pioneer
pursuant to the Transaction Documents which are required to be
disclosed in the Prospectus are disclosed therein; (iii) any real
property and buildings held under lease by the Company, Pioneer, STOC
or the Partnership are held under valid, subsisting and enforceable
leases with such exceptions as are not material and do not interfere
with the use made and proposed to be made of such property and
buildings by the Company, Pioneer, STOC or the Partnership;
(hh) The Partnership or Pioneer has title insurance on all
properties and assets described in the Prospectus as owned by the
Partnership or Pioneer in an amount at least equal to the cost of
acquisition of such property or assets.
(ii) None of the Company, the Partnership, Pioneer or STOC
maintains, or has at any time maintained, any "plan" (as defined in
Section 3(3) of the United States Employee Retirement Income Security
Act of 1974 ("ERISA") and the regulations and published interpretations
thereunder) that is subject to the minimum funding standards of Section
302 of ERISA.
(jj) The Partnership, Pioneer, STOC and the Company have
implemented a comprehensive, detailed program to analyze and address
the risk that their computer hardware and software may be unable to
recognize and properly execute date-sensitive functions involving
certain dates prior to and any dates after December 31, 1999 (the "Year
2000 Problem") and have determined that their computer hardware and
software are and will be able to process all date information prior to
and after December 31, 1999 without any errors, aborts, delays or other
interruptions in operations associated with the Year 2000 Problem; and
the Partnership and the Company believe, after due inquiry, that each
supplier, vendor, customer or financial service organization used or
serviced by the Company, STOC, Pioneer or the Partnership has remedied
or will remedy on a timely basis the Year 2000 Problem, except to the
extent that a failure to remedy by any such supplier, vendor, customer
or financial service organization would have a material adverse effect
on the Company, the Partnership and their subsidiaries, taken as a
whole. The Company, the Partnership, STOC
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and Pioneer are in compliance with the Commission's Release dated
July 29, 1998 related to Year 2000 compliance, as amended to date.
(kk) None of the environmental engineering firms or
individuals who prepared environmental inspection reports with respect
to the Timberlands, was employed for such purpose on a contingent basis
or has any interest in the Company, the Partnership, STOC or Pioneer;
none of them and none of their directors, officers or employees is
connected with the Company, the Partnership or Pioneer as a promoter,
selling agent, voting trustee, director, officer or employee.
(ll) The Company has not offered, or caused the Underwriters
to offer, Securities to any person pursuant to the Directed Share
Program with the specific intent to unlawfully influence (i) a customer
or supplier of the Company, Pioneer or the Partnership to alter the
customer's or supplier's level or type of business with the Company,
Pioneer or the Partnership or (ii) a trade journalist or publication to
write or publish favorable information about the Company, Pioneer or
the Partnership or their properties.
Furthermore, the Company represents and warrants to Xxxxxxx Xxxxx
Xxxxxx that (i) the Registration Statement, the Prospectus and any preliminary
prospectus comply, and any further amendments or supplements thereto will
comply, with any applicable laws or regulations of foreign jurisdictions in
which the Prospectus or any preliminary prospectus, as amended or supplemented,
if applicable, are distributed in connection with the Directed Share Program,
and that (ii) no authorization, approval, consent, license, order, registration
or qualification of or with any government, governmental instrumentality or
court, other than such as have been obtained, is necessary under the securities
laws and regulations of foreign jurisdictions in which the Directed shares are
offered outside the United States.
Any certificate signed by any officer of the Company, STOC, Pioneer or
the Partnership and delivered to the Representatives or counsel for the
Underwriters in connection with the offering of the Securities shall be deemed a
representation and warranty by the Company, STOC, Pioneer or the Partnership,
respectively, as to matters covered thereby, to each Underwriter.
2. Purchase and Sale. (a) Subject to the terms and conditions and
in reliance upon the representations and warranties herein set forth, the
Company agrees to sell to each Underwriter, and each Underwriter agrees,
severally and not jointly, to purchase from the Company, at a purchase price of
$ per share, the number of the Underwritten Securities set forth opposite such
Underwriter's name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance upon
the representations and warranties herein set forth, the Company hereby
grants an option to the several Underwriters to purchase, severally and
not jointly, up to 2,490,000 Option Securities at the same purchase
price per share as the Underwriters shall pay for the Underwritten
Securities. Said option may be exercised only to cover over-allotments
in the sale of the Underwritten Securities by the Underwriters. Said
option may be exercised in whole or in part at any time
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(but not more than once) on or before the 30th day after the date of
the Prospectus upon written or telegraphic notice by the
Representatives to the Company setting forth the number of shares of
the Option Securities as to which the several Underwriters are
exercising the option and the settlement date. The number of Option
Securities to be purchased by each Underwriter shall be the same
percentage of the total number of shares of the Option Securities to be
purchased by the several Underwriters as such Underwriter is purchasing
of the Underwritten Securities, subject to such adjustments as you in
your absolute discretion shall make to eliminate any fractional shares.
3. Delivery and Payment. Delivery of and payment for the
Underwritten Securities and the Option Securities (if the option provided for in
Section 2(b) hereof shall have been exercised on or before the third Business
Day prior to the Closing Date) shall be made at 10:00 AM, New York City time, on
___________, 1999, or at such time on such later date not more than three
Business Days after the foregoing date as the Representatives shall designate,
which date and time may be postponed by agreement between the Representatives
and the Company or as provided in Section 9 hereof (such date and time of
delivery and payment for the Securities being herein called the "Closing Date").
Delivery of the Securities shall be made to the Representatives for the
respective accounts of the several Underwriters against payment by the several
Underwriters through the Representatives of the purchase price thereof to or
upon the order of the Company by wire transfer payable in same-day funds to an
account specified by the Company. Delivery of the Underwritten Securities and
the Option Securities shall be made through the facilities of The Depository
Trust Company unless the Representatives shall otherwise instruct.
If the option provided for in Section 2(b) hereof is exercised
after the third Business Day prior to the Closing Date, the Company will deliver
the Option Securities (at the expense of the Company) to the Representatives, at
000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, xx the date specified by the
Representatives (which shall be within three Business Days after exercise of
said option) for the respective accounts of the several Underwriters, against
payment by the several Underwriters through the Representatives of the purchase
price thereof to or upon the order of the Company by wire transfer payable in
same-day funds to an account specified by the Company. If settlement for the
Option Securities occurs after the Closing Date, the Company will deliver to the
Representatives on the settlement date for the Option Securities, and the
obligation of the Underwriters to purchase the Option Securities shall be
conditioned upon receipt of, supplemental opinions, certificates and letters
confirming as of such date the opinions, certificates and letters delivered on
the Closing Date pursuant to Section 6 hereof.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as set forth
in the Prospectus.
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5. Agreements. Each of the Partnership and the Company agrees
with the several Underwriters that:
(a) The Company will use its best efforts to cause the
Registration Statement, if not effective at the Execution Time, and any
amendment thereof, to become effective. Prior to the termination of the
offering of the Securities, the Company will not file any amendment of
the Registration Statement or supplement to the Prospectus or any Rule
462(b) Registration Statement unless the Company has furnished you a
copy for your review prior to filing and will not file any such
proposed amendment or supplement to which you reasonably object.
Subject to the foregoing sentence, if the Registration Statement has
become or becomes effective pursuant to Rule 430A, or filing of the
Prospectus is otherwise required under Rule 424(b), the Company will
cause the Prospectus, properly completed, and any supplement thereto to
be filed with the Commission pursuant to the applicable paragraph of
Rule 424(b) within the time period prescribed and will provide evidence
satisfactory to the Representatives of such timely filing. The Company
will promptly advise the Representatives (1) when the Registration
Statement, if not effective at the Execution Time, shall have become
effective, (2) when the Prospectus, and any supplement thereto, shall
have been filed (if required) with the Commission pursuant to Rule
424(b) or when any Rule 462(b) Registration Statement shall have been
filed with the Commission, (3) when, prior to termination of the
offering of the Securities, any amendment to the Registration Statement
shall have been filed or become effective, (4) of any request by the
Commission or its staff for any amendment of the Registration
Statement, or any Rule 462(b) Registration Statement, or for any
supplement to the Prospectus or for any additional information, (5) of
the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose and (6) of the receipt
by the Company of any notification with respect to the suspension of
the qualification of the Securities for sale in any jurisdiction or the
institution or threatening of any proceeding for such purpose. The
Company will use its best efforts to prevent the issuance of any such
stop order or the suspension of any such qualification and, if issued,
to obtain as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Prospectus as then supplemented would include
any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein in the light of the
circumstances under which they were made not misleading, or if it shall
be necessary to amend the Registration Statement or supplement the
Prospectus to comply with the Act or the rules thereunder, the Company
promptly will (1) notify the Representatives of any such event, (2)
prepare and file with the Commission, subject to the second sentence of
paragraph (a) of this Section 5, an amendment or supplement which will
correct such statement or omission or effect such compliance; and (3)
supply any supplemented Prospectus to you in such quantities as you may
reasonably request.
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(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an
earnings statement or statements of the Company and its subsidiaries
which will satisfy the provisions of Section 11(a) of the Act and Rule
158 under the Act.
(d) The Company will furnish to the Representatives and
counsel for the Underwriters copies of the signed Registration
Statement (including exhibits thereto) and to each other Underwriter a
copy of the Registration Statement (without exhibits thereto) and, so
long as delivery of a prospectus by an Underwriter or dealer may be
required by the Act, as many copies of each Preliminary Prospectus and
the Prospectus and any supplement thereto as the Representatives may
reasonably request.
(e) The Company will arrange, if necessary, for the
qualification of the Securities for sale under the laws of such
jurisdictions as the Representatives may designate and will maintain
such qualifications in effect so long as required for the distribution
of the Securities; provided that in no event shall the Company be
obligated to qualify to do business in any jurisdiction where it is not
now so qualified or to take any action that would subject it to service
of process in suits, other than those arising out of the offering or
sale of the Securities, in any jurisdiction where it is not now so
subject.
(f) Neither the Company nor the Partnership will, without the
prior written consent of Xxxxxxx Xxxxx Barney, for a period of one year
from the Closing Date, offer, sell or contract to sell, or otherwise
dispose of (or enter into any transaction which is designed to result
in the disposition (whether by actual disposition or effective economic
disposition due to cash settlement or otherwise) by the Company or the
Partnership or any affiliate of the Company or the Partnership or any
person in privity with the Company or the Partnership or any affiliate
of the Company or the Partnership) directly or indirectly, or announce
the offering of, any other shares of Common Stock or Units or any
securities convertible into, or exchangeable for, shares of Common
Stock or Units; provided, however, that (i) the Company may issue and
sell Common Stock and issue options to purchase Common Stock pursuant
to any employee stock option plan or stock ownership plan of the
Company in effect at the Execution Time, and (ii) the Partnership may
issue Units as partial or full payment for the acquisition of
properties.
(g) Neither the Company nor the Partnership nor any of their
officers, directors or controlling persons has taken or will take,
directly or indirectly, any action designed to or which has constituted
or which might reasonably be expected to cause or result, under the
Exchange Act or otherwise, in stabilization or manipulation of the
price of any security of the Company or the Partnership to facilitate
the sale or resale of the Securities.
(h) The Company agrees to pay the costs and expenses relating
to the following matters: (i) the preparation, printing or reproduction
and filing with the Commission of the Registration Statement (including
financial statements and exhibits thereto), each Preliminary
Prospectus, the Prospectus, and each amendment or supplement to any of
them;
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(ii) the printing (or reproduction) and delivery (including postage,
air freight charges and charges for counting and packaging) of such
copies of the Registration Statement, each Preliminary Prospectus, the
Prospectus, and all amendments or supplements to any of them, as may,
in each case, be reasonably requested for use in connection with the
offering and sale of the Securities; (iii) the preparation, printing,
authentication, issuance and delivery of certificates for the
Securities, including any stamp or transfer taxes in connection with
the original issuance and sale of the Securities; (iv) the printing (or
reproduction) and delivery of this Agreement, any blue sky memorandum
and all other agreements or documents printed (or reproduced) and
delivered in connection with the offering of the Securities; (v) the
registration of the Securities under the Exchange Act and the listing
of the Securities on the NASDAQ National Market; (vi) any registration
or qualification of the Securities for offer and sale under the
securities or blue sky laws of the several states (including filing
fees and the reasonable fees and expenses of counsel for the
Underwriters relating to such registration and qualification); (vii)
any filings required to be made with the National Association of
Securities Dealers, Inc. (the "NASD"), including filing fees and the
reasonable fees and expenses of counsel for the Underwriters relating
to such filings; (viii) the transportation and other expenses incurred
by or on behalf of Company representatives in connection with
presentations to prospective purchasers of the Securities; (ix) the
fees and expenses of the Company's accountants and the fees and
expenses of counsel for the Company; (x) all fees and disbursements of
counsel incurred by the Underwriters in connection with the Directed
Share Program and stamp duties, similar taxes or duties or other taxes,
if any, incurred by the Underwriters in connection with the Directed
Share Program; and (xi) all other costs and expenses incident to the
performance by the Company and the Partnership of their obligations
hereunder.
(i) The Company and the Partnership will use the net proceeds
from the sale of the Securities, together with amounts drawn under the
New Credit Facility, in the manner specified in the Prospectus under
the caption "Use of Proceeds."
(j) The Company will use its best efforts to meet the
requirements to qualify, commencing with the tax year ending December
31, 1998, as a "real estate investment trust" under the Code.
(k) In connection with the Directed Share Program, the Company
will ensure that the Directed Shares will be restricted to the extent
required by the NASD or the NASD rules from sale, transfer, assignment,
pledge or hypothecation for a period of three months following the date
of the effectiveness of the Registration Statement. Xxxxxxx Xxxxx
Barney will notify the Company as to which Participants will need to be
so restricted. The Company will direct the transfer restrictions upon
such period of time.
Furthermore, the Company covenants with Xxxxxxx Xxxxx Xxxxxx that the
Company will comply with all applicable securities and other applicable laws,
rules and regulations in each foreign jurisdiction in which the Directed Shares
are offered in connection with the Directed Share Program.
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6. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Underwritten Securities and the
Option Securities, as the case may be, shall be subject to the accuracy of the
representations and warranties on the part of the Company and the Partnership
contained herein as of the Execution Time, the Closing Date and any Settlement
Date pursuant to Section 3 hereof, to the accuracy of the statements of the
Company and the Partnership made in any certificates pursuant to the provisions
hereof, to the performance by the Company and the Partnership of their
obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective
prior to the Execution Time, unless the Representatives agree in
writing to a later time, the Registration Statement will become
effective not later than (i) 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 3:00 PM New York City time on such date or (ii)
9:30 AM on the Business Day following the day on which the public
offering price was determined, if such determination occurred after
3:00 PM New York City time on such date; if filing of the Prospectus,
or any supplement thereto, is required pursuant to Rule 424(b), the
Prospectus, and any such supplement, will be filed in the manner and
within the time period required by Rule 424(b); and no stop order
suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been
instituted or threatened.
(b) The Company shall have requested and caused Xxxxxxxxxx
Xxxxxx & Xxxxxxx LLP, counsel for the Company, to have furnished to the
Representatives their opinion, dated the Closing Date and addressed to
the Representatives, to the effect that:
(i) Each of the Company and STOC has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction in which it is
chartered or organized, with full corporate power and
authority to own or lease, as the case may be, and to operate
its properties and conduct its business as described in the
Prospectus, and is duly qualified to do business as a foreign
corporation and is in good standing under the laws of each
jurisdiction wherein it owns or leases material properties or
conducts material business and where the failure to be so
qualified would, individually or in the aggregate, have a
material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the
Company, STOC, Pioneer and the Partnership, taken as a whole,
whether or not arising from transactions in the ordinary
course of business. Notwithstanding the foregoing, each of the
Company and STOC is duly qualified to do business as a foreign
corporation and is in good standing under the laws of
[California, Washington, Oregon, Louisiana and New Hampshire.]
(ii) All the outstanding shares of capital stock of
STOC have been duly and validly authorized and issued and are
fully paid and nonassessable, and are owned by the Company
free and clear of any perfected security interest and, to the
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knowledge of such counsel, after due inquiry, any other
security interest, claim, lien or encumbrance.
(iii) Pioneer has been duly organized and is validly
existing as a limited liability company in good standing under
the laws of the jurisdiction in which it is organized, with
full limited liability company power and authority to own or
lease, as the case may be, and to operate its properties and
conduct its business as described in the Prospectus, and is
duly qualified to do business as a foreign company and is in
good standing under the laws of each jurisdiction wherein it
owns or leases material properties or conducts material
business and where the failure to be so qualified would,
individually or in the aggregate, have a material adverse
effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company, STOC, Pioneer
and the Partnership, taken as a whole, whether or not arising
from transactions in the ordinary course of business.
Notwithstanding the foregoing, Pioneer is duly qualified to do
business as a foreign company and is in good standing under
the laws of [California, Washington and New Hampshire]. Upon
consummation of the Formation Transactions, the Partnership
will own all of the member interests in Pioneer and such
member interests will have been duly authorized and validly
issued and will be fully paid and nonassessable and will be
owned by the Partnership, free and clear of any perfected
security interest and, to the knowledge of such counsel, after
due inquiry, any other security interest, claim, lien or
encumbrance.
(iv) The Partnership Agreement has been duly and
validly authorized, executed and delivered by STOC and the
Company and is a valid and binding agreement of STOC and the
Company enforceable in accordance with its terms. The
Partnership has been duly formed and is validly existing as a
limited partnership in good standing under the laws of the
State of Delaware, with all requisite limited partnership
power and authority to own or lease, as the case may be, and
to operate its properties and conduct the business in which it
is engaged or proposes to engage as described in the
Prospectus and is duly qualified or registered as a foreign
partnership and is in good standing in each jurisdiction
wherein it owns or leases material properties or conducts
material business and where the failure to be so qualified
would, individually or in the aggregate, have a material
adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company,
STOC, Pioneer and the Partnership, taken as a whole, whether
or not arising from transactions in the ordinary course of
business. Notwithstanding the foregoing, the Partnership is
duly qualified to do business as a foreign limited partnership
and is in good standing under the laws of [California,
Washington, Oregon, Louisiana and New Hampshire.] STOC is, and
immediately after the Closing Date, will be, the sole general
partner of the Partnership. The Partnership has no
subsidiaries other than Pioneer.
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(v) All of the issued and outstanding Units have been
duly authorized and validly issued, are fully paid and
nonassessable and are owned by the Company, STOC and the
entities or persons described in the Prospectus, free and
clear of any perfected security interest and, to the knowledge
of such counsel, after due inquiry, any other security
interest, claim, lien or encumbrance. The Units were offered
and sold at or prior to the Closing Date in compliance with
all applicable laws (including, without limitation, federal
securities laws).
(vi) The Company's authorized equity capitalization
is as set forth in the Prospectus; the capital stock of the
Company conforms in all material respects to the description
thereof contained in the Prospectus; the outstanding shares of
Common Stock have been duly and validly authorized and issued
and are fully paid and nonassessable; the Securities have been
duly and validly authorized, and, when issued and delivered to
and paid for by the Underwriters pursuant to this Agreement,
will be fully paid and nonassessable; the certificates for the
Securities are in valid and sufficient form under Georgia law
and the rules of the NASDAQ National Market; the Company has
duly reserved a sufficient number of shares of Common Stock
for issuance upon exchange of outstanding Units in the
Partnership; the holders of outstanding shares of capital
stock of the Company are not entitled to preemptive or other
rights to subscribe for the Securities; and, except as set
forth in the Prospectus, no options, warrants or other rights
to purchase, agreements or other obligations to issue, or
rights to convert any obligations into or exchange any
securities for, shares of capital stock or Units of or
ownership interests in the Company or the Partnership are
outstanding.
(vii) To the knowledge of such counsel, there is no
pending or threatened action, suit or proceeding by or before
any court or governmental agency, authority or body or any
arbitrator involving the Company, the Partnership, STOC or
Pioneer or its or their property of a character required to be
disclosed in the Registration Statement which is not
adequately disclosed in the Prospectus, and there is no
franchise, contract or other document of a character required
to be described in the Registration Statement or Prospectus,
or to be filed as an exhibit thereto, which is not described
or filed as required; and the statements included in the
Prospectus under the headings "Federal Income Tax
Consequences," "ERISA Considerations," "Description of Capital
Stock of the Company," "Transactions with Related Parties,"
"The Partnership Agreement," "Certain Provisions of Georgia
Law and Strategic Timber's Articles of Incorporation and
Bylaws That May Have an Anti-Takeover Effect," "Shares
Available for Future Sale,""Business and Properties - Federal
and State Regulations" and "- Legal Proceedings", to the
extent they include descriptions of agreements or other legal
documents or include summaries of law, are accurate and fair
summaries.
(viii) The Registration Statement has become effective
under the Act; any required filing of the Prospectus, and any
supplements thereto, pursuant to
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Rule 424(b) has been made in the manner and within the time
period required by Rule 424(b); and to the knowledge of such
counsel, no stop order suspending the effectiveness of the
Registration Statement has been issued, no proceedings for
that purpose have been instituted or threatened and the
Registration Statement and the Prospectus (other than the
financial statements and other financial information 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 and the rules thereunder.
(ix) This Agreement has been duly authorized,
executed and delivered by the Company and the Partnership.
(x) None of the Company, Pioneer, STOC or the
Partnership is, and, after giving effect to the offering and
sale of the Securities and the application of the proceeds
thereof as described in the Prospectus, none of the Company,
Pioneer, STOC or the Partnership will be, an "investment
company" or an entity "controlled" by an "investment company"
as such terms are defined in the Investment Company Act of
1940, as amended.
(xi) No consent, approval, authorization, filing with
or order of any court or governmental agency or body is
required in connection with the transactions contemplated
herein, except such as have been obtained under the Act and
such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution
of the Securities by the Underwriters in the manner
contemplated in this Agreement and in the Prospectus and such
other approvals (specified in such opinion) as have been
obtained.
(xii) The Company has all legal right, power and
authority necessary to qualify as a "real estate investment
trust" under the Code; the Company has been duly organized in
conformity with the requirements for qualification and
taxation as a real estate investment trust under the Code, and
its proposed method of operation will enable it to meet the
requirements for taxation as a real estate investment trust
under the Code, commencing with the Company's taxable year
ending December 31, 1998.
(xiii) Neither the issue and sale of the Securities,
nor the consummation of any other of the transactions herein
contemplated nor the fulfillment of the terms hereof will
conflict with, result in a breach or violation of or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company, STOC, Pioneer or the
Partnership pursuant to, (i) the charter or by-laws of the
Company or STOC, or the articles of organization or operating
agreement of Pioneer, (ii) the Partnership Agreement, (iii)
the terms of any indenture, contract, lease, mortgage, deed of
trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which the
Company, STOC, Pioneer or the Partnership is a party or
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bound or to which its or their property is subject, or (iv)
any statute, law, rule, regulation, judgment, order or decree
known to such counsel to be applicable to the Company, STOC,
Pioneer or the Partnership of any court, regulatory body,
administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company, STOC, Pioneer
or the Partnership or any of its or their properties, which
violation or default would, in the case of clauses (iii) and
(iv) above, either individually or in the aggregate with all
other violations and defaults referred to in this paragraph
(xiii) (if any), have a material adverse effect on the
condition (financial or otherwise), prospects, earnings,
business or properties of the Company, STOC, Pioneer and the
Partnership, taken as a whole, whether or not arising from
transactions in the ordinary course of business.
(xiv) Consummation of each of the Formation Transactions
and compliance by the Company, Pioneer, XXXX, XXX0, XXXXX,
XXX0, the Partnership and the Continuing Investors with their
respective obligations under each of the Transaction Documents
have been duly authorized by all necessary corporate,
partnership or limited liability company action, as the case
may be, and did not and will not violate or conflict with or
constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any of the Properties or any other properties or assets of the
Company, Pioneer, XXXX, XXX0, XXXXX, XXX0, the Partnership or
the Continuing Investors pursuant to any indenture, contract,
lease, mortgage, deed of trust, note agreement, loan agreement
or other agreement, obligation, condition, covenant or
instrument, including, without limitation, any partnership
agreement to which the Company, Pioneer, XXXX, XXX0, XXXXX,
XXX0, the Partnership or any of the Continuing Investors is or
was a party or by which it or any of them may be bound or
affected, or to which any of the Properties or any other
properties or assets of the Company, Pioneer, XXXX, XXX0,
XXXXX, XXX0, the Partnership or any of the Continuing
Investors is subject, except pursuant to indentures,
contracts, leases, mortgages, deeds of trust, note agreements,
loan agreements or other agreements, obligations, conditions,
covenants or instruments which shall be paid in full or
terminated as of the Closing Date; none of the Formation
Transactions resulted or will result in the violation of any
provisions of the charter, bylaws, articles of organization or
operating agreement of the Company, Pioneer, XXXX, XXX0,
XXXXX, or any Continuing Investor or any agreement,
certificate of limited partnership or other governing document
of the Partnership, STP2 or any Continuing Investor or any
applicable law, administrative regulation or administrative or
court decree; and all authorizations, consents and approvals
necessary to consummate the Formation Transactions were timely
obtained; and the offer, issuance and exchange of the general
and limited partnership interests in the Partnership are
exempt from the registration requirements of the Act and
applicable state securities and blue sky laws.
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(xv) Each of the Transaction Documents, to which the
Company, the Partnership, any Continuing Investor, Pioneer,
XXXX, XXX0, XXXXX, XXX0 or any affiliate of any such entity is
a party has been duly authorized, executed and delivered by
such party and constitutes the binding agreement of such
party, enforceable against such party in accordance with its
terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization or other similar laws
affecting creditors' rights generally and by general
principles of equity.
(xvii) No holders of securities of the Company or the
Partnership have rights to the registration of such securities
except as set forth in the Prospectus.
Such counsel shall also confirm that such counsel has no reason to
believe that on the Effective Date or at the Execution Time the
Registration Statement 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 as of its date and on the Closing Date included or
includes any untrue statement of a material fact or omitted or omits to
state a material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading
(in each case, other than the financial statements and other financial
and statistical information contained therein, as to which such counsel
need express no opinion).
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the
laws of the State of Georgia, the General Corporation Laws and the
Limited Partnership Act of the State of Delaware or the Federal laws of
the United States, to the extent they deem proper and specified in such
opinion, upon the opinion of other counsel of good standing whom they
believe to be reliable and who are satisfactory to counsel for the
Underwriters and (B) as to matters of fact, to the extent they deem
proper, on certificates of responsible officers of the Company and
public officials. References to the Prospectus in this paragraph (b)
include any supplements thereto at the Closing Date.
(c) The Representatives shall have received from Xxxxxxx &
Xxxxx L.L.P., counsel for the Underwriters, such opinion or opinions,
dated the Closing Date and addressed to the Representatives, with
respect to the issuance and sale of the Securities, the Registration
Statement, the Prospectus (together with any supplement thereto) and
other related matters as the Representatives may reasonably require,
and the Company shall have furnished to such counsel such documents as
they reasonably request for the purpose of enabling them to pass upon
such matters.
(d) The Company and the Partnership shall have furnished to
the Representatives a certificate of such parties, signed by the
President and Chief Executive Officer and the Senior Vice President and
Chief Financial Officer of the Company, and by the general partner of
the Partnership, dated the Closing Date, to the effect that the signers
of such
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certificates have carefully examined the Registration Statement, the
Prospectus, any supplements to the Prospectus and this Agreement and
that:
(i) the representations and warranties of the Company
and the Partnership in this Agreement are true and correct in
all material respects on and as of the Closing Date with the
same effect as if made on the Closing Date and each of the
Company and the Partnership has complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings
for that purpose have been instituted or, to the Company's
knowledge, threatened; and
(iii) since the date of the most recent financial
statements included in the Prospectus (exclusive of any
supplement thereto), there has been no material adverse change
in the condition (financial or otherwise), prospects,
earnings, business or properties of the Partnership, Pioneer,
XXXX, XXX0, XXXXX, XXX0 and the Company, taken as a whole,
whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in
the Prospectus (exclusive of any supplement thereto).
(e) The Company shall have requested and caused Xxxxxx
Xxxxxxxx LLP to have furnished to the Representatives, at the Execution
Time and at the Closing Date, letters, dated respectively as of the
Execution Time and as of the Closing Date, in form and substance
satisfactory to the Representatives, and substantially in the form
heretofore approved by the Representatives.
(f) Subsequent to the Execution Time or, if earlier, the dates
as of which information is given in the Registration Statement
(exclusive of any amendment thereof) and the Prospectus (exclusive of
any supplement thereto), there shall not have been (i) any change in
total assets or in stockholders' equity of the Company or any change in
Partners' capital of the Partnership or any increase in long-term debt
or short-term debt of the Company or the Partnership or any change in
net income or EBITDDA from that set forth or contemplated in the
Prospectus or (ii) any change, or any development involving a
prospective change, in or affecting the condition (financial or
otherwise), earnings, business or properties of Pioneer, the
Partnership, the Company and STOC, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as
set forth in or contemplated in the Prospectus (exclusive of any
supplement thereto) the effect of which, in any case referred to in
clause (i) or (ii) above, is, in the sole judgment of the
Representatives, so material and adverse as to make it impractical or
inadvisable to proceed with the offering or delivery of the Securities
as contemplated by the Registration Statement (exclusive of any
amendment thereof) and the Prospectus (exclusive of any supplement
thereto).
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(g) Prior to the Closing Date, the Company shall have
furnished to the Representatives such further information, certificates
and documents as the Representatives may reasonably request.
(h) At or prior to the Closing Date, the Securities shall have
been listed and admitted and authorized for quotation on the NASDAQ
National Market, and satisfactory evidence of such actions shall have
been provided to the Representatives.
(i) At the Execution Time, the Company shall have furnished to
the Representatives a letter substantially in the form of Exhibit A
hereto from each officer and director of the Company and Louisiana
Timber Partners LLC, Mach One Partners LLC, Xxxxxxx X. Xxxxxx and Old
Pioneer, LLC.
(j) At or prior to the Closing Date, each of the Formation
Transactions shall have occurred.
(k) On the Closing Date, the Company shall have paid in full
the Bridge Loan, the STT2 Bridge Loan, the Old Partnership Credit
Facility and the Pioneer Credit Facility (as such terms are used in the
Prospectus).
(l) At or prior to the Execution Time, each of Xxxxx Xxxxx &
Xxxxxx, Inc. and Canal Forest Resources, Inc. shall have furnished a
letter addressed to the Representatives, dated on or before the
Execution Time, and substantially in the form heretofore approved by
the Representatives.
(m) On or prior to the Closing Date, the New Credit Facility
shall have been executed and delivered and become effective in
substantially the form filed as an exhibit to the Registration
Statement.
If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and counsel for the
Underwriters, this Agreement and all obligations of the Underwriters hereunder
may be canceled at, or at any time prior to, the Closing Date by the
Representatives. Notice of such cancellation shall be given to the Company in
writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall
be delivered at the office of Xxxxxxxxxx Xxxxxx & Xxxxxxx, counsel for the
Company, at 000 Xxxxxxxxx Xxxxxx, XX, Xxxxxxx, Xxxxxxx 00000, on the Closing
Date.
7. Reimbursement of Underwriters' Expenses. If the sale of
the Securities provided for herein is not consummated because any condition to
the obligations of the Underwriters set forth in Section 6 hereof is not
satisfied, because of any termination pursuant to Section 10
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hereof or because of any refusal, inability or failure on the part of the
Company or the Partnership to perform any agreement herein or comply with any
provision hereof other than by reason of a default by any of the Underwriters,
the Company will reimburse the Underwriters severally through Xxxxxxx Xxxxx
Barney on demand for all out-of-pocket expenses (including reasonable fees and
disbursements of counsel) that shall have been incurred by them in connection
with the proposed purchase and sale of the Securities.
8. Indemnification and Contribution. (a) Each of the
Partnership and the Company, jointly and severally, agrees to indemnify and hold
harmless each Underwriter, the directors, officers, employees and agents of each
Underwriter and each person who controls any Underwriter within the meaning of
either the Act or the Exchange Act against any and all losses, claims, damages
or liabilities, joint or several, to which they or any of them may become
subject under the Act, the Exchange Act or other Federal or state statutory law
or regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact
contained in the registration statement for the registration of the Securities
as originally filed or in any amendment thereof, or in any Preliminary
Prospectus or the Prospectus, or in any amendment thereof or supplement thereto,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and agrees to reimburse each such indemnified
party, as incurred, for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company and the Partnership
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 such untrue statement or
alleged untrue statement or omission or alleged omission made therein in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein. This indemnity agreement will be in addition
to any liability which the Company or the Partnership may otherwise have.
(b) Each of the Partnership and the Company, jointly and
severally, agrees to indemnify and hold harmless Xxxxxxx Xxxxx Xxxxxx and each
person, if any, who controls Xxxxxxx Xxxxx Barney within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act ("Xxxxxxx
Xxxxx Xxxxxx Entities"), from and against any and all losses, claims, damages
and liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) (i) caused by any untrue statement or alleged untrue statement
of a material fact contained in the prospectus wrapper material prepared by or
with the consent of the Company or the Partnership for distribution in foreign
jurisdictions in connection with the Directed Share Program attached to the
Prospectus or any preliminary prospectus, or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statement therein, when considered in conjunction with the
Prospectus or any applicable preliminary prospectus, not misleading; (ii) caused
by the failure of the Participant to pay for and accept delivery of the shares
which immediately following the effectiveness of the Registration Statement,
were subject to a properly confirmed agreement to purchase; or (iii) related to,
arising out of, or in connection with the
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Directed Share Program, provided that, the Company and the Partnership shall be
not responsible under this subparagraph (iii) for any losses, claims, damages or
liabilities (or expenses relating thereto) that are finally judicially
determined to have resulted from the bad faith or gross negligence of Xxxxxxx
Xxxxx Xxxxxx Entities.
(c) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless the Company and the Partnership, each of their
directors, each of their officers who signs the Registration Statement, and each
person who controls the Company and the Partnership within the meaning of either
the Act or the Exchange Act, to the same extent as the foregoing indemnity from
the Company and the Partnership to each Underwriter, but only with reference to
written information relating to such Underwriter furnished to the Company by or
on behalf of such Underwriter through the Representatives specifically for
inclusion in the documents referred to in the foregoing indemnity. This
indemnity agreement will be in addition to any liability which any Underwriter
may otherwise have. The Company and the Partnership acknowledge that the
statements set forth in the last paragraph of the cover page regarding delivery
of the Securities, and under the heading "Underwriting", (i) the list of
Underwriters and their respective participation in the sale of the Securities,
(ii) the sentences relating to concessions and reallowances and (iii) the
paragraph relating to stabilization, syndicate covering transactions and penalty
bids in any Preliminary Prospectus and the Prospectus constitute the only
information furnished in writing by or on behalf of the several Underwriters for
inclusion in any Preliminary Prospectus or the Prospectus.
(d) 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 in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a), (b) or (c) above unless
and to the extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial rights and
defenses and (ii) will not, in any event, relieve the indemnifying party from
any obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. The indemnifying party shall
be entitled to appoint counsel of the indemnifying party's choice at the
indemnifying party's expense to represent the indemnified party in any action
for which indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be satisfactory to the indemnified
party. Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party
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shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of the
institution of such action or (iv) the indemnifying party shall authorize the
indemnified party to employ separate counsel at the expense of the indemnifying
party. Notwithstanding anything contained herein to the contrary, if indemnity
may be sought pursuant to Section 8(b) hereof in respect of such action or
proceeding, then in addition to such separate firm for the indemnified parties,
the indemnifying party shall be liable for the reasonable fees and expenses of
not more than one separate firm (in addition to any local counsel) for Xxxxxxx
Xxxxx Barney for the defense of any losses, claims, damages and liabilities
arising out of the Directed Share Program, and all persons, if any, who control
Xxxxxxx Xxxxx Xxxxxx within the meaning of either Section 15 of the Act or
Section 20 of the Exchange Act. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a),
(b) or (c) of this Section 8 is unavailable to or insufficient to hold harmless
an indemnified party for any reason, the Company and the Partnership and the
Underwriters severally agree to contribute to the aggregate losses, claims,
damages and liabilities (including legal or other expenses reasonably incurred
in connection with investigating or defending same) (collectively "Losses") to
which the Company and the Partnership and one or more of the Underwriters may be
subject in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Partnership on the one hand and by the
Underwriters on the other from the offering of the Securities; provided,
however, that in no case shall any Underwriter (except as may be provided in any
agreement among underwriters relating to the offering of the Securities) be
responsible for any amount in excess of the underwriting discount or commission
applicable to the Securities purchased by such Underwriter hereunder. If the
allocation provided by the immediately preceding sentence is unavailable for any
reason, the Company and the Partnership and the Underwriters severally shall
contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company and the Partnership
on the one hand and of the Underwriters on the other in connection with the
statements or omissions which resulted in such Losses as well as any other
relevant equitable considerations. Benefits received by the Company and the
Partnership shall be deemed to be equal to the total net proceeds from the
offering (before deducting expenses) received by the Company, and benefits
received by the Underwriters shall be deemed to be equal to the total
underwriting discounts and commissions, in each case as set forth on the cover
page of the Prospectus. Relative fault shall be determined by reference to,
among other things, whether any untrue or any alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information provided by the Company or the Partnership on the one
hand or the Underwriters on the other, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. The Company, the Partnership and the
Underwriters agree that it would not be just and equitable if contribution were
determined by pro rata allocation or any other method of allocation which does
not take
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account of the equitable considerations referred to above. Notwithstanding the
provisions of this paragraph (d), 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 Section 8, each person who controls an
Underwriter within the meaning of either the Act or the Exchange Act and each
director, officer, employee and agent of an Underwriter shall have the same
rights to contribution as such Underwriter, and each person who controls the
Company or the Partnership within the meaning of either the Act or the Exchange
Act, each officer of the Company who shall have signed the Registration
Statement and each director of the Company shall have the same rights to
contribution as the Company or the Partnership, subject in each case to the
applicable terms and conditions of this paragraph (d). For purposes of this
paragraph (d), the Company and the Partnership shall be deemed one party jointly
and severally liable for any obligations hereunder.
9. Default by an Underwriter. If any one or more Underwriters
shall fail to purchase and pay for any of the Securities agreed to be purchased
by such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule I hereto bears to the aggregate amount of
Securities set forth opposite the names of all the remaining Underwriters) the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Securities set forth in
Schedule I hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Securities,
and if such nondefaulting Underwriters do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting Underwriter or
the Company. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Date shall be postponed for such period, not exceeding
five Business Days, as the Representatives shall determine in order that the
required changes in the Registration Statement and the Prospectus or in any
other documents or arrangements may be effected. Nothing contained in this
Agreement shall relieve any defaulting Underwriter of its liability, if any, to
the Company and any nondefaulting Underwriter for damages occasioned by its
default hereunder.
10. Termination. This Agreement shall be subject to
termination in the absolute discretion of the Representatives, by notice given
to the Company prior to delivery of and payment for the Securities, if at any
time prior to such time (i) trading in the Company's Common Stock shall have
been suspended by the Commission or the New York Stock Exchange or trading in
securities generally on the New York Stock Exchange shall have been suspended or
limited or minimum prices shall have been established on such Exchange, (ii) a
banking moratorium shall have been declared either by Federal or New York State
authorities or (iii) there shall have occurred any outbreak or escalation of
hostilities, declaration by the United States of a national emergency or war, or
other calamity or crisis the effect of which on financial markets is such as to
make it, in the sole judgment of the Representatives, impractical or inadvisable
to proceed with the offering or delivery of the Securities as contemplated by
the Prospectus (exclusive of any supplement thereto).
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11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or the Partnership or their officers and of the Underwriters set forth
in or made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or the
Company or the Partnership or any of the officers, directors or controlling
persons referred to in Section 8 hereof, and will survive delivery of and
payment for the Securities. The provisions of Sections 7 and 8 hereof shall
survive the termination or cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing
and effective only on receipt, and, if sent to the Representatives, will be
mailed, delivered or telefaxed to the Xxxxxxx Xxxxx Barney General Counsel (fax
no.: (000) 000-0000) and confirmed to the General Counsel, Xxxxxxx Xxxxx Xxxxxx,
at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention: General Counsel;
or, if sent to the Company or the Partnership, will be mailed, delivered or
telefaxed to the General Counsel of Strategic Timber Trust, Inc. (fax no: (603)
000-0000) and confirmed to it at 0 Xxxxx Xxxxxxxx Xxxxxx, Xxx Xxxxxx, XX 00000,
Attention: General Counsel.
13. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 8 hereof,
and no other person will have any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
15. Counterparts. This Agreement may be signed in one or
more counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
16. Headings. The section headings used herein are for
convenience only and shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in this
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or
trust companies are authorized or obligated by law to close in New York
City.
"Commission" shall mean the Securities and Exchange
Commission.
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"Effective Date" shall mean each date and time that the
Registration Statement, any post-effective amendment or amendments
thereto and any Rule 462(b) Registration Statement became or become
effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this
Agreement is executed and delivered by the parties hereto.
"Preliminary Prospectus" shall mean any preliminary prospectus
referred to in paragraph 1(a) above and any preliminary prospectus
included in the Registration Statement at the Effective Date that omits
Rule 430A Information.
"Prospectus" shall mean the prospectus relating to the
Securities that is first filed pursuant to Rule 424(b) after the
Execution Time or, if no filing pursuant to Rule 424(b) is required,
shall mean the form of final prospectus relating to the Securities
included in the Registration Statement at the Effective Date.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits and financial
statements, as amended at the Execution Time (or, if not effective at
the Execution Time, in the form in which it shall become effective)
and, in the event any post-effective amendment thereto or any Rule
462(b) Registration Statement becomes effective prior to the Closing
Date, shall also mean such registration statement as so amended or such
Rule 462(b) Registration Statement, as the case may be. Such term shall
include any Rule 430A Information deemed to be included therein at the
Effective Date as provided by Rule 430A.
"Rule 424", "Rule 430A" and "Rule 462" refer to such rules\
under the Act.
"Rule 430A Information" shall mean information with respect to
the Securities and the offering thereof permitted to be omitted from
the Registration Statement when it becomes effective pursuant to Rule
430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b)
relating to the offering covered by the registration statement referred
to in Section 1(a) hereof.
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If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company, the Partnership and the several Underwriters.
Very truly yours,
Strategic Timber Trust, Inc.
By:
----------------------------------------------
Name:
--------------------------------------------
Title:
-------------------------------------------
Strategic Timber Partners, LP
By Strategic Timber Operating Co., as
General Partner of Strategic Timber Partners, LP
By:
----------------------------------------------
Name:
--------------------------------------------
Title:
-------------------------------------------
The foregoing Agreement is hereby
confirmed and accepted as of
the date first above written.
Xxxxxxx Xxxxx Barney Inc.
Credit Suisse First Boston Corporation
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
X.X. Xxxxxxx & Sons, Inc.
Warburg Dillon Read LLC
ABN AMRO Incorporated
Xxxxxx Xxxxxx & Company, Inc.
By: Xxxxxxx Xxxxx Barney Inc.
By:
----------------------------------------------
Name:
--------------------------------------------
Title:
-------------------------------------------
For themselves and the other
several Underwriters named in
Schedule I to the foregoing
Agreement.
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SCHEDULE I
NUMBER OF UNDERWRITTEN
UNDERWRITER SECURITIES TO BE PURCHASED
----------- --------------------------
Xxxxxxx Xxxxx Xxxxxx Inc.....................................................
Credit Suisse First Boston Corporation.......................................
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation..........................
X.X. Xxxxxxx & Sons, Inc.....................................................
Warburg Dillon Read LLC......................................................
ABN AMRO Bank................................................................
Xxxxxx Xxxxxx & Company, Inc.................................................
----------
Total.................................................................. 16,600,000
==========
34
EXHIBIT A
[LETTERHEAD OF OFFICER, DIRECTOR OR MAJOR SHAREHOLDER OF
CORPORATION OR MAJOR UNITHOLDER OF THE PARTNERSHIP]
Strategic Timber Trust, Inc.
Public Offering of Common Stock
, 1999
Xxxxxxx Xxxxx Barney Inc.
Credit Suisse First Boston Corporation
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
X.X. Xxxxxxx & Sons, Inc.
Warburg Dillon Read LLC
ABN AMRO Incorporated
Xxxxxx Xxxxxx & Company, Inc.
As Representatives of the several Underwriters,
c/o Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is being delivered to you in connection with the
proposed Underwriting Agreement (the "Underwriting Agreement"), among Strategic
Timber Trust, Inc., a Georgia corporation (the "Company"), Strategic Timber
Partners, LP, a Delaware limited partnership (the "Partnership"), and you as
representatives of a group of Underwriters named therein, relating to an
underwritten public offering of Common Stock, $.01 par value (the "Common
Stock"), of the Company.
In order to induce you and the other Underwriters to enter
into the Underwriting Agreement, the undersigned will not, without the prior
written consent of Xxxxxxx Xxxxx Xxxxxx Inc., offer, sell, contract to sell,
pledge or otherwise dispose of, or file (or participate in the filing of) a
registration statement with the Securities and Exchange Commission in respect
of, or establish or increase a put equivalent position or liquidate or decrease
a call equivalent position within the meaning of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder with respect to, any
shares of capital stock of the Company or any limited partnership interests of
the Partnership ("Units") or any securities convertible into or exercisable or
exchangeable for such capital stock or Units, or publicly announce an intention
to effect any such transaction, for a period of one year after the Closing Date
(as defined in the Underwriting Agreement), other than:
(a) shares of Common Stock or Units disposed of as bona fide
gifts approved by Xxxxxxx Xxxxx Barney Inc. where each of the
transferees (i) is an "accredited investor" within the meaning of Rule
501(a) of Regulation D under the Securities Act of 1933, as amended,
and (ii) agrees to be bound by the terms of this letter;
35
(b) shares of Common Stock or Units transferred to members of
the undersigned's family (spouse, parents, children or siblings), or to
trusts, family limited partnerships or family limited liability
companies for the benefit of any of them, so long as the undersigned or
the undersigned's family members retain the entire beneficial interest
in the Common Stock or Units, and where (i) each of the transferees is
an "accredited investor" and agrees to be bound by the terms of this
letter, and (ii) the undersigned has notified Xxxxxxx Xxxxx Xxxxxx
Inc.; and
(c) shares of Common Stock or Units disposed of pursuant to a
pledge, grant of security interest or other encumbrance effected in a
bona fide transaction approved by Xxxxxxx Xxxxx Xxxxxx Inc. with an
unrelated and unaffiliated pledgee where (i) the pledgee is an
"accredited investor" and agrees to be bound by the terms of this
agreement and (ii) the pledgee agrees that its will under not
circumstances foreclose with respect to such shares or Units until
after one year from the Closing date.
If for any reason the Underwriting Agreement shall be
terminated prior to the Closing Date (as defined in the Underwriting Agreement),
the agreement set forth above shall likewise be terminated.
Yours very truly,
[SIGNATURE OF OFFICER, DIRECTOR OR
MAJOR STOCKHOLDER OR MAJOR UNITHOLDER]
[NAME AND ADDRESS OF OFFICER, DIRECTOR OR MAJOR
STOCKHOLDER OR MAJOR UNITHOLDER]
