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EXHIBIT 1.1
XXXXXXX REAL ESTATE, INC.
XXXXXXX OPERATING LIMITED PARTNERSHIP
$75,000,000 OF 8.875% NOTES DUE 2006
UNDERWRITING AGREEMENT
March 7, 2000
SUTRO & CO. INCORPORATED
DEUTSCHE BANK SECURITIES INC.
c/o Sutro & Co. Incorporated
00000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Dear Ladies and Gentlemen:
Xxxxxxx Real Estate, Inc., a Maryland corporation (the "Company"), and
Xxxxxxx Operating Limited Partnership, a Delaware limited partnership (the
"Operating Partnership" and together with the Company, the "Transaction
Entities"), confirm their agreement with Sutro & Co. Incorporated and Deutsche
Bank Securities Inc. (each, an "Underwriter" and, collectively, the
"Underwriters," which terms shall also include any underwriter substituted as
hereinafter provided in Section 8 of this Underwriting Agreement), with respect
to the sale by the Operating Partnership and the purchase by the Underwriters,
acting severally and not jointly, of $75,000,000 aggregate principal amount of
its 8.875% Notes due 2006 (the "Securities"), as further described on Schedules
A and B hereto.
Capitalized terms used but not otherwise defined herein shall have the
meanings given to those terms in the Prospectus (as herein defined):
1. DESCRIPTION OF SECURITIES. The Operating Partnership proposes to issue and
sell to the Underwriters the Securities to be issued under an Indenture, dated
November 24, 1997 (the "Senior Indenture"), as supplemented by Supplemental
Indenture No. 3 thereto to be dated as of March 10, 2000 (the "Supplemental
Indenture" and together with the Senior Indenture, the "Indenture") between the
Operating Partnership and LaSalle Bank National Association, as trustee (the
"Trustee").
2. REPRESENTATIONS AND WARRANTIES OF THE TRANSACTION ENTITIES. Each of the
Transaction Entities, jointly and severally, represents and warrants to
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each Underwriter as follows:
(a) The Operating Partnership has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (File No.
333-51675) for the registration of debt securities under the Securities Act of
1933, as amended (the "1933 Act"), and the offering thereof from time to time in
accordance with Rule 415 of the rules and regulations of the Commission
thereunder (the "1933 Act Rules and Regulations"). Such registration statement
has been declared effective by the Commission. Such registration statement and
the prospectus constituting a part thereof, as from time to time amended or
supplemented by the filing of documents pursuant to the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), or the 1933 Act or otherwise, is
referred to herein as the "Registration Statement." A prospectus supplement (the
"Prospectus Supplement") setting forth the terms of the offer and sale of the
Securities contemplated by this Agreement, and additional information concerning
the Company and its business has been or will be prepared and will be filed by
the Company pursuant to Rule 424(b) of the 1933 Act Rules and Regulations, on or
before the second business day after it is first used in connection with the
offer and sale of Securities under this Agreement (or such earlier time as may
be required by the 1933 Act Rules and Regulations). The final form of prospectus
included in the Registration Statement, as supplemented by the Prospectus
Supplement, is referred to herein as the "Prospectus," except that if any
revised prospectus, whether or not such revised prospectus is required to be
filed by the Company pursuant to Rule 424(b) of the 1933 Act Rules and
Regulations, shall be provided to you by the Company for use in connection with
the offer and sale of any of the Securities under this Agreement, the term
"Prospectus" shall refer to such revised prospectus from and after the time such
documents are first provided to you for such use.
(b) Each part of the Registration Statement, when such part became or
becomes effective, and the Prospectus and any amendment or supplement to such
Registration Statement or such Prospectus, on the date of filing thereof with
the Commission and at the Closing Date (as hereinafter defined) conformed or
will conform in all material respects with the requirements of the 1933 Act and
the 1933 Act Rules and Regulations; the Indenture, on the date of filing thereof
with the Commission and at the Closing Date conformed or will conform in all
material respects with the requirements of the Trust Indenture Act of 1939, as
amended, and the rules and regulations of the Commission thereunder (the "TIA");
each part of the Registration Statement, when such part became or becomes
effective did not or will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading; the Prospectus and any amendment or
supplement thereto, on the date of filing thereof with the Commission and at the
Closing Date did not or will not include an untrue statement of a material fact
or omit to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
except that the foregoing shall not apply to (i) that part of the Registration
Statement which constitutes the Statement of Eligibility and Qualification under
the TIA (the "Form T-1") and (ii) statements in, or omissions from, any such
document in reliance upon, and in conformity with, information concerning the
Underwriters that was furnished to the Transaction Entities by the Underwriters
specifically for use in the preparation thereof.
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(c) The documents incorporated by reference in the Registration Statement,
the Prospectus and any amendment or supplement to such Registration Statement or
such Prospectus, when they became or become effective under the 1933 Act or were
or are filed with the Commission under the Exchange Act, as the case may be,
conformed or will conform in all material respects with the requirements of the
1933 Act, the 1933 Act Rules and Regulations, the Exchange Act and the rules and
regulations of the Commission thereunder (the "Exchange Act Rules and
Regulations"), as applicable.
(d) The financial statements of the Operating Partnership set forth or
incorporated by reference in the Registration Statement and Prospectus fairly
present the financial condition of the Operating Partnership as of the dates
indicated and the results of operations and changes in financial position for
the periods therein specified in conformity with generally accepted accounting
principles consistently applied through the periods involved (except as
otherwise stated therein). The summary financial, pro forma financial and
statistical data included or incorporated by reference in the Registration
Statement and the Prospectus present fairly the information shown therein and,
to the extent based upon or derived from the financial statements, have been
compiled on a basis consistent with the financial statements presented therein.
No other financial statements are required to be set forth in the Registration
Statement or the Prospectus under the 1933 Act or the 1933 Act Rules and
Regulations.
(e) The only subsidiaries (as defined in the 1933 Act Rules and
Regulations) of the Transaction Entities are the subsidiaries listed on Schedule
C hereto (the "Subsidiaries"). Each of the Transaction Entities and each of
their Subsidiaries has been duly incorporated or formed, as the case may be, and
is an existing corporation or general or limited partnership, as the case may
be, in good standing under the laws of its jurisdiction of incorporation or
formation, as the case may be. Each of the Transaction Entities and each of its
Subsidiaries has full power and authority (corporate and other) to conduct its
business as described in the Registration Statement and Prospectus, and is duly
qualified to do business in each jurisdiction in which it owns or leases real
property or in which the conduct of its business requires such qualification,
except where the failure to be so qualified, considering all such cases in the
aggregate, does not involve a material risk to the business, properties,
financial position or results of operations of the Transaction Entities taken as
a whole; and, other than the Subsidiaries, the Transaction Entities own no
material amounts of stock or beneficial interest in any corporation,
partnership, joint venture or other business entity and do not own 10% or more
of the outstanding voting stock of any entity separately taxable as a
corporation under the Internal Revenue Code of 1986, as amended (the "Code").
(f) The Xxxxxxx Operating Limited Partnership Second Restated Agreement of
Limited Partnership, dated September 2, 1997, as amended by amendments dated
July 31, 1998, August 6, 1998, February 23, 1999 and September 7, 1999 (the
"Operating Partnership Agreement") has been duly and validly authorized, is in
full force and effect and is a valid and binding agreement of the parties
thereto, enforceable in accordance with its terms. All of the
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partnership interests of the Operating Partnership have been duly and validly
authorized and issued and are fully paid and approximately 83% of such
partnership interests are owned of record and beneficially by the Company free
and clear of all liens, encumbrances, equities or claims. Except as set forth in
the Registration Statement or the Prospectus, all of the outstanding capital
stock, partnership or other equity interests of each Subsidiary have been duly
and validly authorized and issued, are fully paid and are owned of record and
beneficially by the Operating Partnership free and clear of all liens,
encumbrances, equities or claims.
(g) The Securities will be as of the Closing Date duly authorized by the
Operating Partnership for issuance and sale pursuant to this Underwriting
Agreement and the Indenture; and when duly authenticated and delivered by the
Trustee in accordance with the terms of the Indenture (assuming the due
authorization, execution and delivery of the Indenture by the Trustee), and
delivered to, and paid for by, the Underwriters pursuant to this Underwriting
Agreement, the Securities will be valid and legally binding obligations of the
Operating Partnership entitled to the benefit of the Indenture and will be
enforceable against the Operating Partnership in accordance with their terms,
except to the extent that enforcement thereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether enforceability is considered in a proceeding at
law or in equity) (together, the "Enforceability Limitations") and the
executing, delivery and performance of any of such agreements did not and will
not, at the time of execution and delivery, and does not and will not constitute
a breach of, or a default under, the charter, bylaws or partnership agreement,
as the case may be, of either of the Transaction Entities or any of their
Subsidiaries or any material contract, lease or other instrument to which the
Transaction Entities or any of their Subsidiaries is a party or to which any of
their property may be bound or any law, administrative regulation or
administrative or court decree, except for such breaches or defaults which
individually or in the aggregate do not involve a material risk to the business,
properties, financial position or results of operations of the Transaction
Entities taken as a whole; the Indenture has been duly qualified under the TIA
and prior to the issuance of the Securities will be duly authorized, executed
and delivered by the Operating Partnership, and assuming due authorization,
execution and delivery thereof by the Trustee, will constitute a valid and
legally binding obligation of the Operating Partnership, enforceable against the
Operating Partnership in accordance with its terms, subject to the
Enforceability Limitations; the Securities and the Indenture will conform in all
material respects to the statements relating thereto contained in the
Prospectus; and the Securities are, in all material respects, in the form
contemplated by the Indenture.
(h) Except as contemplated in the Registration Statement or the Prospectus,
subsequent to the respective dates as of which information is given in the
Registration Statement and the Prospectus, the Transaction Entities have not
incurred any liabilities or obligations, direct or contingent, or entered into
any transactions, not in the ordinary course of business, that are material to
the Transaction Entities on a consolidated basis, and there has not been any
material change in the capital stock, partnership interests, short-term debt or
long-term debt of the Transaction Entities, or any material adverse change, or
any development involving a prospective
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material adverse change, in the condition (financial or other), business,
prospects, net worth or results of operations of the Transaction Entities on a
consolidated basis.
(i) Except as set forth in the Prospectus, there is not pending or, to the
knowledge of the Transaction Entities, threatened any action, suit or proceeding
to which any of the Transaction Entities or their Subsidiaries is a party (or
involving the assets, properties or businesses of any of the Transaction
Entities or their Subsidiaries) before or by any court or governmental agency or
body, that might result in any material adverse change in the condition
(financial or other), business, prospects, net worth or results of operations of
the Transaction Entities and their Subsidiaries taken as a whole, or might
materially and adversely affect the properties or assets thereof.
(j) There are no contracts or documents of the Transaction Entities that
are required to be filed as exhibits to the Registration Statement or to any of
the documents incorporated by reference therein by the 1933 Act or the Exchange
Act or by the 1933 Act Rules and Regulations or the Exchange Act Rules and
Regulations that have not been so filed.
(k) This Underwriting Agreement has been duly executed, delivered and will
be performed by each of the Transaction Entities, and the Indenture has been
duly authorized, executed delivered and performed by the Operating Partnership.
The execution of this Underwriting Agreement and the Indenture and the
consummation of the transactions herein and therein contemplated will not result
in a breach or violation of any of the terms and provisions of, or constitute a
default under, any statute, any agreement or instrument to which either of the
Transaction Entities is a party or by which it is bound or to which any of the
property of either of the Transaction Entities is subject, the charter, or
bylaws or partnership agreement, as the case may be, of either of the
Transaction Entities, or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over either of the Transaction
Entities or any of their properties; no consent, approval, authorization or
order of, or filing with, any court or governmental agency or body is required
for the consummation of the transactions contemplated by this Underwriting
Agreement and the Indenture in connection with the issuance or sale of the
Securities by the Operating Partnership, except such as may be required under
the 1933 Act, the TIA or state securities laws; and the Operating Partnership
has full power and authority to authorize, issue and sell the Securities as
contemplated by this Underwriting Agreement and the Indenture, free of any
preemptive or similar rights.
(l) The Transaction Entities have complied in all respects with all laws,
regulations and orders applicable to them or their respective businesses; the
Transaction Entities are not in default under any indenture, mortgage, deed of
trust, voting trust agreement, loan agreement, bond debenture, note agreement or
evidence of indebtedness, lease, contract or other agreement or instrument to
which either of the Transaction Entities is a party or by which either of the
Transaction Entities or any of their properties are bound, the violation of or
default under which would individually or in the aggregate have a material
adverse effect on the Transaction Entities, and no other party under any such
agreement or instrument to which either of the Transaction
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Entities is a party, to the knowledge of the Transaction Entities, is in default
in any material respect thereunder; and neither of the Transaction Entities is
in violation of their organizational documents.
(m) Except as described in the Prospectus, and except for defects or
exceptions that are not material in relation to the business of the Transaction
Entities, their Subsidiaries and Related Entities (as defined below), taken as a
whole:
(i) the Operating Partnership and each of its Subsidiaries and any
partnership or joint venture in which such party is a participant (a "Related
Entity") have good and marketable title to all of the properties described in
the Registration Statement (the "Properties"), free and clear of any liens,
charges, encumbrances, claims or restrictions ("Liens"), other than those Liens
that are disclosed in the Registration Statement;
(ii) the Operating Partnership, its Subsidiaries and Related Entities
have valid, subsisting and enforceable (subject to the Enforceability
Limitations) leases for the properties described in the Prospectus as leased by
them;
(iii) no tenant under any of the leases pursuant to which the
Operating Partnership, its Subsidiaries and Related Entities lease their
Properties has an option or right of first refusal to purchase the premises
demised under such lease;
(iv) to the knowledge of the Transaction Entities, the use and
occupancy of each of the Properties of the Operating Partnership, its
Subsidiaries and Related Entities complies in all material respects with all
applicable codes and zoning laws and regulations;
(v) the Operating Partnership, its Subsidiaries and Related Entities
have no knowledge of any pending or threatened condemnation or zoning change
that will in any material respect affect the size of, use of, improvement of,
construction on, or access to any of the Properties of the Operating
Partnership, its Subsidiaries or Related Entities; and
(vi) the Operating Partnership, its Subsidiaries and Related Entities
have no knowledge of any pending or threatened proceeding or action that will in
any manner materially affect the size of, use of, improvements on, construction
on, or access to any of the Properties of the Operating Partnership, its
Subsidiaries or Related Entities.
(n) Title insurance in favor of the mortgagee, the Transaction Entities,
their Subsidiaries and Related Entities is maintained with respect to each of
the Properties owned by the Transaction Entities, their Subsidiaries and Related
Entities, as shown in the Prospectus, in an amount at least equal to the greater
of (i) the cost of acquisition of such property and (ii) the cost of
construction by the Transaction Entities, their Subsidiaries or Related Entities
of the improvements located on such property (measured at the time of such
construction), except, in each case, where the failure to maintain such title
insurance would not have a material adverse
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effect on the condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Transaction Entities, their Subsidiaries
and Related Entities taken as a whole.
(o) The mortgages and deeds of trust encumbering the Properties and assets
described in the Prospectus are not convertible, nor do the Operating
Partnership or its Subsidiaries hold a participating interest therein.
(p) Except as set forth in the Prospectus, none of the Transaction Entities
has any knowledge of (i) the unlawful presence of any hazardous substances,
hazardous materials, toxic substances or waste materials (collectively,
"Hazardous Materials") on any of the properties owned by each of them, or (ii)
any unlawful spills, releases, discharges or disposal of Hazardous Materials
that have occurred or are presently occurring off such properties as a result of
any construction on or operation and use of such properties, which presence or
occurrence would have a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business prospects of the
Transaction Entities taken as whole. In connection with the construction on or
operation and use of the properties owned by the Transaction Entities, each of
the Transaction Entities represents that, as of the date of this Underwriting
Agreement, it has no knowledge of any failure to comply with all applicable
local, state and federal environmental laws, regulations, ordinances and
administrative and judicial orders relating to the generation, recycling, sale,
storage, handling, transport and disposal of any Hazardous Materials, which
failure would have a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business prospects of the
Transaction Entities taken as a whole.
(q) Property and casualty insurance in favor of each of the Transaction
Entities and each of their Subsidiaries is maintained with respect to each of
the properties owned by each of them in an amount and on such items as is
reasonable and customary for businesses of this type.
(r) Each Transaction Entity has filed all federal, state and foreign income
tax returns which have been required to be filed and has paid all taxes
indicated by said returns and all assessments received by it to the extent that
such taxes have become due.
(s) The Operating Partnership is classified as a partnership (and is not
taxed as a corporation) for federal income tax purposes.
(t) Each approval, consent, order, authorization, designation, declaration
or filing by or with any regulatory, administrative or other governmental body
necessary in connection with the execution and delivery by the Transaction
Entities of this Underwriting Agreement and the consummation of the transactions
herein contemplated (except such additional steps as may be required by the
National Association of Securities Dealers, Inc., or as may be necessary under
state securities laws) has been obtained or made and is in full force and
effect.
(u) Each Transaction Entity holds all material licenses, certificates and
permits from governmental authorities which are necessary to the conduct of its
business; and neither of the
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Transaction Entities have infringed any patents, patent rights, trade names,
trademarks or copyrights, which infringement is material to the business of the
Operating Partnership as a whole.
(v) For all applicable tax years as to which the Company's tax returns are
subject to audit and the Company is subject to assessment for taxes reportable
therein, the Company has continuously been organized and operated in conformity
with the requirements for qualification as a real estate investment trust under
the Code. The Company's method of operation will permit it to continue to meet
the requirements for taxation as a real estate investment trust under the Code.
The Company has no intention of changing its operations or engaging in
activities which would adversely affect its ability to qualify, or make
economically undesirable its continued qualification as, a real estate
investment trust.
(w) Neither Transaction Entity or any of its subsidiaries, is an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
(x) Each of the partnership and joint venture agreements to which either of
the Transaction Entities is a party, and which relates to real property
described in the Registration Statement, has been duly authorized, executed and
delivered by such applicable party and constitutes the valid agreement thereof,
enforceable in accordance with its terms, subject to the Enforceability
Limitations, and the executing, delivery and performance of any of such
agreements did not and will not, at the time of execution and delivery, and does
not and will not constitute a breach of, or a default under, the charter,
partnership agreement or bylaws of either of the Transaction Entities or any
material contract, lease or other instrument to which the Transaction Entities
or any of their Subsidiaries is a party or to which any of their property may be
bound or any material law, administrative regulation or administrative or court
decree.
3. PURCHASE, SALE AND DELIVERY OF SECURITIES. On the basis of the
representations, warranties and agreements contained herein, but subject to the
terms and conditions set forth herein, the Operating Partnership agrees to issue
and sell the Securities to the Underwriters, and each Underwriter, severally and
not jointly, agrees to purchase from the Operating Partnership the respective
principal amount of Securities set forth on Schedule A hereto at the purchase
price set forth on Schedule B hereto plus accrued interest, if any, from the
date specified on Schedule B hereto to the date of payment and delivery. The
Operating Partnership understands that the Underwriters intend (i) to make a
public offering of the Securities and (ii) initially to offer the Securities
upon the terms set forth in the Prospectus. Payment for the Securities shall be
made to the Operating Partnership or to its order in immediately available funds
in the amount, on the date and at the time and place set forth on Schedule D
hereto (or at such other time and place on the same or such other date, not
later than the third Business Day thereafter, as you and the Operating
Partnership may agree in writing). Such payment will be made upon delivery to
you of the Securities registered in such names and in such denominations as you
shall request not less than two full Business Days prior to the date of
delivery, with transfer taxes, if any, payable in connection with transfer to
the Underwriters
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duly paid by the Operating Partnership. As used herein, the term "Business Day"
means any day other than a day on which banks are permitted or required to be
closed in Chicago, Illinois. The time and date of such payment and delivery with
respect to the Securities are referred to herein as the "Closing Date." The
Securities will be delivered through the book entry facilities of The Depository
Trust Company ("DTC") and will be made available for inspection by you by 1:00
P.M. Chicago, Illinois time on the Business Day prior to the Closing Date at the
offices of Xxxxx, Brown & Xxxxx, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx
00000.
4. COVENANTS. Each of the Transaction Entities jointly and severally covenants
and agrees to:
(a) Cause the Prospectus to be filed pursuant to Rule 424(b) of the 1933
Act Rules and Regulations on or before the second business day after the date
hereof (or such earlier time as may be required by the 1933 Act Rules and
Regulations) (but only if you or your counsel have not reasonably objected
thereto by notice to the Transaction Entities after having been furnished a copy
a reasonable time prior to filing) and will notify you promptly of such filing.
During the period in which a prospectus relating to the Securities is required
to be delivered under the 1933 Act, the Transaction Entities will (i) notify you
promptly of the time when any subsequent amendment to the Registration Statement
has become effective or any supplement to the Prospectus has been filed and of
any request by the Commission for any amendment or supplement to the
Registration Statement or Prospectus or for additional information, (ii) prepare
and file with the Commission, promptly upon your request, any amendments or
supplements to the Registration Statement or Prospectus that, in your opinion,
may be necessary or advisable in connection with your distribution of the
Securities, and (iii) file no amendment or supplement to the Registration
Statement or Prospectus (other than any document required to be filed under the
Exchange Act that upon filing is deemed to be incorporated by reference therein)
to which you or your counsel shall reasonably object by notice to the
Transaction Entities after having been furnished a copy a reasonable time prior
to the filing.
(b) Advise you, promptly after either one of them shall receive notice or
obtain knowledge thereof, of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement, of the suspension of
the qualification or registration of the Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceeding for any such
purpose; and it will promptly use its best efforts to prevent the issuance of
any stop order or to obtain its withdrawal if such a stop order should be
issued.
(c) Comply with all requirements imposed upon them by the 1933 Act, the
1933 Act Rules and Regulations, the Exchange Act, the Exchange Act Rules and
Regulations and the TIA as from time to time in force, so far as necessary to
permit the continuance of sales of, or dealings in, the Securities as
contemplated by the provisions hereof and the Prospectus. If during such period
any event occurs as a result of which, in the opinion of your counsel, the
Registration Statement contains an untrue statement of a material fact or omits
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading or the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit to
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state a material fact necessary to make the statements therein, in the light of
the circumstances then existing, not misleading, or if during such period it is
necessary to amend or supplement the Registration Statement or Prospectus to
comply with the 1933 Act, the Transaction Entities will promptly notify you and
will amend or supplement the Registration Statement or Prospectus (at the
expense of the Transaction Entities) so as to correct such statement or omission
or effect such compliance.
(d) Furnish to you copies of the Registration Statement, the Prospectus
(including all documents incorporated by reference therein) and all amendments
and supplements to the Registration Statement and Prospectus that are filed with
the Commission during the period in which a prospectus relating to the
Securities is required to be delivered under the 1933 Act (including all
documents filed with the Commission during such period that are deemed to be
incorporated by reference therein), in each case as soon as available and in
such quantities as you may from time to time reasonably request.
(e) Furnish you with copies of filings of the Transaction Entities under
the 1933 Act and Exchange Act and with all other financial statements and
reports it distributes generally to the holders of any class of its capital
stock during the period of five years commencing on the date upon which the
Prospectus Supplement is filed pursuant to Rule 424(b) of the 1933 Act Rules and
Regulations.
(f) Make generally available to its security holders as soon as practicable
and in the manner contemplated by Rule 158 of the 1933 Act Rules and
Regulations, but in any event not later than 15 months after the end of the
Transaction Entity's current fiscal quarter, an earning statement (which need
not be audited) covering a 12-month period beginning after the date upon which
the Prospectus is filed pursuant to Rule 424(b) of the 1933 Act Rules and
Regulations that shall satisfy the provisions of Section 11(a) of the 1933 Act
and Rule 158 of the 1933 Act Rules and Regulations and will advise you in
writing when such statement has been made available.
(g) Pay, or reimburse if paid by you, whether or not the transactions
contemplated by this Underwriting Agreement are consummated or this Underwriting
Agreement is terminated, all costs and expenses incident to the performance of
the obligations of the Transaction Entities under this Underwriting Agreement,
including but not limited to costs and expenses of or relating to (i) the
preparation, printing and filing of the Registration Statement and exhibits
thereto, the Prospectus and any amendment or supplement to the Registration
Statement or the Prospectus, (ii) the word processing and reproduction of the
Indenture and the Securities, (iii) the costs incurred by the Transaction
Entities in furnishing (including costs of shipping, mailing and courier) such
copies of the Registration Statement, the Prospectus and all amendments and
supplements thereto, as may be requested for use in connection with the offering
and sale of the Securities by you or by dealers to whom Securities may be sold,
(iv) any registration or qualification of the Securities for offer and sale
under the securities or blue sky laws of such jurisdictions designated by you,
including the reasonable fees, disbursements and other charges of your counsel
in connection therewith, and the preparation of a blue sky memoranda, (iv) the
fees charged by Xxxxx'x Investors Service, Inc. ("Moody's") and Standard &
Poor's Rating
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Services ("S&P" and, together with Moody's, the "Rating Agencies") for the
rating of the Securities at the request of the Operating Partnership, (v)
counsel to the Transaction Entities, (vi) the registrar for the Securities,
(vii) the costs and expenses of the Trustee under the Indenture and (viii) KPMG
Peat Marwick LLP ("KPMG") or any other accountants engaged by the Transaction
Entities in connection with the offering of the Securities.
(h) Not take, at any time, directly or indirectly, other than in connection
with this Underwriting Agreement, any action designed to stabilize, or which
might reasonably be expected to cause or result in, or which has constituted or
which might reasonably be expected to constitute the stabilization of, the price
of the Securities.
(i) Take all reasonable action necessary to enable the Rating Agencies to
provide their respective credit ratings of the Securities.
(j) Execute and deliver the Supplemental Indenture designating the
Securities as the debt securities to be offered, and its terms and provisions in
accordance with the provisions of the Senior Indenture.
(k) Apply the net proceeds to the Operating Partnership from the sale of
the Securities by the Operating Partnership as set forth under the caption "Use
of Proceeds" in the Prospectus.
(l) The Company will use its best efforts to meet the requirements to
qualify as a "real estate investment trust" under the Code for the taxable year
in which sales of the Securities are to occur, unless otherwise specified in the
Prospectus.
5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS AT THE CLOSING. The Underwriters'
obligation to purchase and pay for the Securities at the Closing as provided
herein shall be subject to the accuracy of the representations and warranties of
the Transaction Entities herein and to the performance by each Transaction
Entity of its obligations hereunder and to the following additional conditions:
(a) You shall have received the opinion of Xxxxxxx, Procter & Xxxx LLP,
counsel for the Operating Partnership, dated the Closing Date, to the effect
that:
(i) Each of the Transaction Entities and each of their Subsidiaries
has been duly incorporated or formed, as the case may be, and is validly
existing as a corporation or general or limited partnership, as the case may be,
and in good standing under the laws of its jurisdiction of incorporation or
formation, as the case may be, has full power and authority to conduct its
business as described in the Registration Statement and Prospectus, and is duly
qualified to do business in each jurisdiction in which it owns or leases real
property or in which the conduct of its business requires such qualification,
except where the failure to be so qualified, considering all such cases in the
aggregate, does not involve a material risk to the business,
12
properties, financial position or results of operations of the Transaction
Entities taken as a whole;
(ii) The Operating Partnership Agreement has been duly and validly
authorized, is in full force and effect and is a valid and binding agreement of
the parties thereto, enforceable in accordance with its terms. All of the
partnership units of the Operating Partnership (as disclosed in the Prospectus)
owned by the Company are owned by the Company free and clear of all liens,
charges and encumbrances;
(iii) The Operating Partnership has the authorized, issued and
outstanding debt, and partnership units as set forth in its Quarterly Report on
Form 10-Q for the quarter ended September 30, 1999; and all of the outstanding
partnership units of the Operating Partnership are fully paid and, to the
knowledge of such counsel, none of them was issued in violation of any
preemptive or other similar right. The issuance of the Securities has been duly
authorized by the Operating Partnership and, when duly authenticated and
delivered by the Trustee in accordance with the terms of the Indenture (assuming
the due authorization, execution and delivery of the Indenture by the Trustee),
and delivered to, and paid for by, the Underwriters pursuant to this
Underwriting Agreement, such Securities will constitute valid and legally
binding obligations of the Operating Partnership entitled to the benefits
provided for in the Indenture and will be enforceable against the Operating
Partnership in accordance with their terms, subject to the Enforceability
Limitations. To the knowledge of such counsel, no holder of any security of the
Operating Partnership has the right to have any such security owned by such
holder included for registration in the Registration Statement or to demand
registration of any security owned by such holder during the 180 days after the
date of this Underwriting Agreement;
(iv) The Registration Statement has become effective under the 1933
Act, the Indenture has been qualified under the TIA, the Prospectus has been
filed as required by Section 4(a) hereof and, to the best knowledge of such
counsel, after due inquiry, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that purpose has
been instituted or threatened by the Commission;
(v) Each part of the Registration Statement, when such part became
effective, and the Prospectus and any amendment or supplement thereto, on the
date of filing thereof with the Commission and at the Closing Date, complied as
to form in all material respects with the requirements of the 1933 Act and the
1933 Act Rules and Regulations; and the documents incorporated by reference in
the Registration Statement or Prospectus or any amendment or supplement thereto,
when they became effective under the 1933 Act or were filed with the Commission
under the Exchange Act, as the case may be, complied as to form in all material
respects with the requirements of the 1933 Act or the Exchange Act, as
applicable, and the 1933 Act or Exchange Act Rules and Regulations, as
applicable; it being understood that such counsel need express no opinion as to
the financial statements or other financial data included in any other documents
mentioned in this clause;
13
(vi) The descriptions in the Registration Statement and Prospectus of
statutes, legal and governmental proceedings, contracts and other documents are
accurate and fairly present the information required to be shown; and such
counsel does not know of any statutes or legal or governmental proceedings
required to be described in the Prospectus that are not described as required,
or of any contracts or documents of a character required to be described in the
Registration Statement or Prospectus (or required to be filed under the Exchange
Act if upon such filing they would be incorporated by reference therein) or to
be filed as exhibits to the Registration Statement that are not described and
filed as required;
(vii) This Underwriting Agreement has been duly authorized, executed
and delivered by each of the Company and the Operating Partnership; the
execution, delivery and performance of this Underwriting Agreement and the
consummation of the transactions contemplated herein will not result in a breach
or violation of any of the terms and provisions of, or constitute a default
under, the charter, bylaws or partnership agreement, as the case may be, of
either of the Company or the Operating Partnership, or any statute known to such
counsel applicable to the Company or the Operating Partnership; and, to the
knowledge of such counsel, no consent, approval, authorization or order of, or
filing with, any court or governmental agency or body is required for the
consummation of the transactions contemplated by this Underwriting Agreement in
connection with the issuance or sale of the Securities by the Operating
Partnership, except such as have been obtained under the 1933 Act and such as
may be required under state securities laws in connection with the purchase and
distribution of the Securities by the Underwriters;
(viii) The Indenture has been duly and validly authorized, executed
and delivered by the Operating Partnership and assuming due authorization,
execution and delivery thereof by the Trustee, will constitute a valid and
legally binding agreement of the Operating Partnership, enforceable against the
Operating Partnership in accordance with its terms, subject to the
Enforceability Limitations; the execution, delivery and performance of the
Indenture and the consummation of the transactions contemplated therein will not
result in a breach or violation of any of the terms and provisions of, or
constitute a default under, the partnership agreement of the Operating
Partnership or any statute applicable to the Operating Partnership and known to
such counsel; and the Indenture has been duly qualified under the TIA;
(ix) The Indenture and the Securities conform in all material respects
to the descriptions thereof in the Registration Statement and the Prospectus
under the captions "Description of Debt Securities" and "Description of Notes;"
(x) For all applicable tax years as to which the Company's tax returns
are subject to audit and the Company is subject to assessment for taxes
reportable therein, the Company has continuously been organized and operated in
conformity with the requirements for qualification as a "real estate investment
trust" under the Code;
(xi) None of the Transaction Entities or their subsidiaries is an
"investment
14
company" within the meaning of the Investment Company Act of 1940, as amended;
(xii) The Operating Partnership is classified as a partnership (and is
not taxed as a corporation) for federal income tax purposes; and
(xiii) The Operating Partnership satisfies all conditions and
requirements for the use of a Registration Statement on Form S-3 under the 1933
Act and the 1933 Act Rules and Regulations.
Such counsel shall also include a statement in such opinion to the effect that:
(i) Such counsel has reviewed the Registration Statement and the
Prospectus and participated in conferences with officers and other
representatives of the Transaction Entities at which contents of the
Registration Statement and related matters were discussed and based on such
review and participation, such counsel has no reason to believe that either any
part of the Registration Statement, when such part became effective, contained
an untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading or that the Prospectus and any amendment or supplement thereto, on
the date of filing thereof with the Commission and at the Closing Date, included
an untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; and
(ii) To the best of such counsel's knowledge and without such counsel
having made any investigation of any governmental records or court dockets or
taken any other similar action, there is no litigation or governmental or other
proceeding or investigation, before any court or before or by any public body or
board pending or, or to such counsel's knowledge, threatened against, or
involving the assets, properties or businesses of, either of the Transaction
Entities or any of their Subsidiaries, involving the Transaction Entities' or
any of their Subsidiaries' officers or directors or to which any of the
Transaction Entities' or any of their Subsidiaries' properties or other assets
is subject which would have a material adverse effect upon the assets or
properties, business, results of operations, prospects or condition (financial
or otherwise) of the Transaction Entities and their Subsidiaries taken as a
whole.
(b) You shall have received from Xxxxx, Xxxxx & Xxxxx, your counsel, such
opinion or opinions, dated the Closing Date, with respect to the organization of
each of the Transaction Entities, the validity of the Securities, the
Registration Statement, the Prospectus and other related matters as you
reasonably may request, and such counsel shall have received such papers and
information as they request to enable them to pass upon such matters.
(c) At the time of execution of this Underwriting Agreement and at the
Closing Date, you shall have received a letter from KPMG, dated at the date of
delivery thereof, in form and substance satisfactory to the Underwriters,
containing statements and information of the type
15
customarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus, including statements with
respect to a review in accordance with SAS 71 of any interim financial
information contained in the Registration Statement and the Prospectus.
(d) You shall have received from the Transaction Entities a certificate,
signed by the president or a vice president and by the principal financial or
accounting officer of the Company, dated the Closing Date, to the effect that,
to the best of their knowledge based upon reasonable investigation:
(i) The representations and warranties of the Transaction Entities in
this Underwriting Agreement are true and correct, as if made at and as of the
Closing Date, and the Transaction Entities have 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 proceeding for that purpose has been
instituted or is threatened, by the Commission; and
(iii) Since the effective date of the Registration Statement, there
has occurred no event required to be set forth in an amendment or supplement to
the Registration Statement or Prospectus that has not been so set forth, and
there has been no document required to be filed under the Exchange Act and the
Exchange Act Rules and Regulations that upon such filing would be deemed to be
incorporated by reference in the Prospectus that has not been so filed.
(e) (i) None of the Transaction Entities or their Subsidiaries or any
Property shall have sustained since the date of the latest financial statements
included in the Prospectus any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus or
(ii) since such date there shall not have been any change in the
capital stock or long-term debt of either Transaction Entity or any change, or
any development involving a prospective change, in or affecting any Property or
the general affairs, management, financial position, stockholders' or partners'
equity, as applicable, or results of operations of either Transaction Entity,
otherwise than as set forth or contemplated in the Prospectus, the effect of
which, in any such case described in clause (i) or (ii), is, in the reasonable
judgment of the Underwriters, so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Securities being delivered on the Closing Date on the terms and in the
manner contemplated in the Prospectus.
(f) on or prior to the Closing Date, the Securities shall have received the
ratings specified in Schedule B from the Rating Agencies and there shall have
been delivered to the
16
Underwriters letters from the Rating Agencies, or other evidence satisfactory to
the Underwriters, confirming that the Securities have such ratings.
(g) All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to you and your counsel. The Operating Partnership will furnish you
with such conformed copies of such opinions, certificates, letters and other
documents as you shall reasonably request and the Operating Partnership shall
furnish to you such further certificates and documents as you shall have
reasonably requested.
6. INDEMNIFICATION AND CONTRIBUTION.
(a) The Transaction Entities jointly and severally will indemnify and hold
harmless each Underwriter and its directors, officers, employees and agents and
each person, if any, who controls each Underwriter within the meaning of Section
15 of the 1933 Act or Section 20 of the Exchange Act from and against any and
all losses, claims, liabilities, expenses and damages (including, but not
limited to, any and all investigative, legal and other expenses reasonably
incurred in connection with, and any and all amounts paid in settlement of, any
action, suit or proceeding between any of the indemnified parties and any
indemnifying parties or between any indemnified party and any third party, or
otherwise, or any claim asserted), as and when incurred, to which an
Underwriter, or any such person, may become subject under the 1933 Act, the
Exchange Act or other federal or state statutory law or regulation, at common
law or otherwise, insofar as such losses, claims, liabilities, expenses or
damages arise out of or are based on (i) any untrue statement or alleged untrue
statementof a material fact contained in any preliminary prospectus, the
Registration Statement or the Prospectus or any amendment or supplement to the
Registration Statement or the Prospectus or in any documents filed under the
Exchange Act and deemed to be incorporated by reference into the Prospectus, or
in any application or other document executed by or on behalf of either
Transaction Entity or based on written information furnished by or on behalf of
either Transaction Entity filed in any jurisdiction in order to qualify the
Securities under the securities laws thereof or filed with the Commission or
(ii) the omission or alleged omission to state in such document a material fact
required to be stated in it or necessary to make the statements in it not
misleading; provided that the Transaction Entities will not be liable to the
extent that such loss, claim, liability, expense or damage arises from the sale
of the Securities to any person by an Underwriter and is based on an untrue
statement or omission or alleged untrue statement or omission made in reliance
on and in conformity with information relating to an Underwriter furnished in
writing to the Transaction Entities by an Underwriter expressly for inclusion in
the Registration Statement, any preliminary prospectus or the Prospectus.
(b) The Underwriters will indemnify and hold harmless each Transaction
Entity and each person, if any, who controls each Transaction Entity within the
meaning of Section 15 of the 1933 Act or Section 20 of the Exchange Act, each
partner of the Transaction Entities and each officer or director of the
Transaction Entities who signs the Registration Statement to the
17
same extent as the foregoing indemnity from the Transaction Entities to the
Underwriters, but only insofar as losses, claims, liabilities, expenses or
damages arise out of or are based on any untrue statement or omission or alleged
untrue statement or omission made in reliance on and in conformity with
information relating to an Underwriter furnished in writing to the Transaction
Entities by such Underwriter expressly for use in the Registration Statement or
the Prospectus. This indemnity will be in addition to any liability that the
Underwriters might otherwise have; provided, however, that in no case shall the
Underwriters be liable or responsible for any amount in excess of the
underwriting discounts and commissions received by the Underwriters.
(c) Any party that proposes to assert the right to be indemnified under
this Section 6 will, promptly after receipt of notice of commencement of any
action against such party in respect of which a claim is to be made against an
indemnifying party or parties under this Section 6, notify each such
indemnifying party of the commencement of such action, enclosing a copy of all
papers served, but the omission so to notify such indemnifying party will not
relieve it from any liability that it may have to any indemnified party under
the foregoing provisions of this Section 6 unless, and only to the extent that,
such omission results in the forfeiture of substantive rights or defenses by the
indemnifying party. If any such action is brought against any indemnified party
and it notifies the indemnifying party of its commencement, the indemnifying
party will be entitled to participate in and, to the extent that it elects by
delivering written notice to the indemnified party promptly after receiving
notice of the commencement of the action from the indemnified party, jointly
with any other indemnifying party similarly notified, to assume the defense of
the action, with counsel satisfactory to the indemnified party, and after notice
from the indemnifying party to the indemnified party of its election to assume
the defense, the indemnifying party will not be liable to the indemnified party
for any legal or other expenses except as provided below and except for the
reasonable costs of investigation subsequently incurred by the indemnified party
in connection with the defense. The indemnified party will have the right to
employ its own counsel in any such action, but the fees, expenses and other
charges of such counsel will be at the expense of such indemnified party unless
(i) the employment of counsel by the indemnified party has been authorized in
writing by the indemnifying party, (ii) the indemnified party has reasonably
concluded (based on advice of counsel) that there may be legal defenses
available to it or other indemnified parties that are different from or in
addition to those available to the indemnifying party, (iii) a conflict or
potential conflict exists (based on advice of counsel to the indemnified party)
between the indemnified party and the indemnifying party (in which case the
indemnifying party will not have the right to direct the defense of such action
on behalf of the indemnified party) or (iv) the indemnifying party has not in
fact employed counsel to assume the defense of such action within a reasonable
time after receiving notice of the commencement of the action, in each of which
cases the reasonable fees, disbursements and other charges of counsel will be at
the expense of the indemnifying party or parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees,
disbursements and other charges of more than one separate firm admitted to
practice in such jurisdiction at any time for all such indemnified party or
parties. All such fees, disbursements and other charges will be reimbursed by
the indemnifying party promptly as they
18
are incurred. An indemnifying party will not be liable for any settlement of any
action or claim effected without its written consent (which consent will not be
unreasonably withheld). No indemnifying party shall, without the prior written
consent of each indemnified party, settle or compromise or consent to the entry
of any judgment in any pending or threatened claim, action or proceeding
relating to the matters contemplated by this Section 6 (whether or not any
indemnified party is a party thereto), unless such settlement, compromise or
consent includes a unconditional release of each indemnified party from all
liability arising or that may arise out of such claim, action or proceeding.
Notwithstanding any other provision of this Section 6(c), if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement effected without its written
consent if (i) such settlement is entered into more than 45 days after receipt
by such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall have received notice of the terms of such settlement at least 30
days prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with such
request prior to the date of such settlement.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in the foregoing
paragraphs of this Section 6 is applicable in accordance with its terms but for
any reason is held to be unavailable from the Transaction Entities or the
Underwriters, the Transaction Entities and the Underwriters will contribute to
the total losses, claims, liabilities, expenses and damages (including any
investigative, legal and other expenses reasonably incurred in connection with,
and any amount paid in settlement of, any action, suit or proceeding or any
claim asserted, but after deducting any contribution received by the Transaction
Entities from persons other than the Underwriters, such as persons who control
the Transaction Entities within the meaning of the 1933 Act and officers of the
Transaction Entities who signed the Registration Statement, who also may be
liable for contribution) to which the Transaction Entities and the Underwriters
may be subject in such proportion as shall be appropriate to reflect the
relative benefits received by the Transaction Entities on the one hand and the
Underwriters on the other. The relative benefits received by the Transaction
Entities on the one hand and the Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Transaction Entities bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus Supplement.
If, but only if, the allocation provided by the foregoing sentence is not
permitted by applicable law, the allocation of contribution shall be made in
such proportion as is appropriate to reflect not only the relative benefits
referred to in the foregoing sentence but also the relative fault of the
Transaction Entities, on the one hand, and the Underwriters, on the other, with
respect to the statements or omissions which resulted in such loss, claim,
liability, expense or damage, or action in respect thereof, as well as any other
relevant equitable considerations with respect to such offering. Such relative
fault shall be determined by reference to whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Transaction Entities or the
Underwriters, the intent of the
19
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The amount paid or payable by an
indemnified party as a result of the loss, claim, liability, expense or damage,
or action in respect thereof, referred to above in this Section 6(d) shall be
deemed to include, for purpose of this Section 6(d), any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 6(d), the Underwriters shall not be required to contribute any amount in
excess of the underwriting discounts, commissions and other compensation
received by the Underwriters and no person found guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) will be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 6(d), any person who controls a
party to this Underwriting Agreement within the meaning of the 1933 Act will
have the same rights to contribution as that party, and each officer of the
Transaction Entities who signed the Registration Statement will have the same
rights to contribution as the Transaction Entities, subject in each case to the
provisions hereof. Any party entitled to contribution, promptly after receipt of
notice of commencement of any action against such party in respect of which a
claim for contribution may be made under this Section 6(d), will notify any such
party or parties from whom contribution may be sought but the omission so to
notify will not relieve the party or parties from whom contribution may be
sought from any other obligation it or they may have under this Section 6(d).
Except for a settlement entered into pursuant to the last sentence of Section
6(c) hereof, no party will be liable for contribution with respect to any action
or claim settled without its written consent (which consent will not be
unreasonably withheld).
(e) The indemnity and contribution agreements contained in this Section 6
and the representations and warranties of the Transaction Entities contained in
this Underwriting Agreement shall remain operative and in full force and effect
regardless of (i) any investigation made by the Underwriters or on their behalf,
(ii) acceptance of the Securities and payment therefor or (iii) any termination
of this Underwriting Agreement.
7. REPRESENTATIONS AND AGREEMENTS TO SURVIVE DELIVERY. All representations,
warranties and agreements of the Transaction Entities contained herein or in
certificates delivered pursuant hereto, and the Underwriters' agreements
contained in Section 6 hereof, shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of the Underwriters
or any controlling persons, or the Transaction Entities or any of its officers
or any controlling persons, and shall survive delivery of and payment for the
Securities hereunder.
8. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If, on the Closing Date, any
Underwriter defaults in the performance of its obligations under this
Underwriting Agreement, the remaining non-defaulting Underwriters shall be
obligated to purchase the Securities that the defaulting Underwriter agreed but
failed to purchase on the Closing Date in the respective proportions which the
principal amount of Securities set forth opposite the name of each remaining
non-defaulting Underwriter in Schedule A hereto bears to the total aggregate
20
principal amount of Securities set forth opposite the names of all the remaining
non-defaulting Underwriters in Schedule A hereto; provided, however, that the
remaining non-defaulting Underwriters shall not be obligated to purchase any of
the Securities on the Closing Date if the total aggregate principal amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase on such date exceeds 9.09% of the total aggregate principal amount of
Securities to be purchased on the Closing Date, and any remaining non-defaulting
Underwriter shall not be obligated to purchase more than 110% of the aggregate
principal amount of Securities which it agreed to purchase on the Closing Date
pursuant to the terms of Section 3 without the written consent of such
Underwriter. If the foregoing maximums are exceeded, the remaining
non-defaulting Underwriters, or those other underwriters satisfactory to the
Underwriters who so agree, shall have the right, but shall not be obligated, to
purchase, in such proportion as may be agreed upon among them, all the
Securities to be purchased on the Closing Date. If the remaining Underwriters or
other underwriters satisfactory to the Underwriters do not elect to purchase the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase on the Closing Date, this Underwriting Agreement shall terminate
without liability on the part of any non-defaulting Underwriter or the
Transaction Entities, except that the Transaction Entities will continue to be
liable for the payment of expenses to the extent set forth in Sections 4 and 6.
As used in this Underwriting Agreement, the term "Underwriter" includes, for all
purposes of this Underwriting Agreement unless the context requires otherwise,
any party not listed in Schedule A hereto who, pursuant to this Section 8,
purchases Securities which a defaulting Underwriter agreed but failed to
purchase. Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Transaction Entities for damages caused by its
default. If other underwriters are obligated or agree to purchase the Securities
of a defaulting or withdrawing Underwriter, either the Underwriters or the
Company may postpone the Closing Date for up to seven full business days in
order to effect any changes that in the opinion of counsel for the Operating
Partnership or counsel for the Underwriters may be necessary in the Registration
Statement, the Prospectus or in any other document or arrangement.
9. TERMINATION. You shall have the right by giving notice as hereinafter
specified at any time at or prior to the Closing Date, to terminate this
Underwriting Agreement if (i) either of the Transaction Entities shall have
failed, refused or been unable, at or prior to the Closing Date, to perform any
agreement on its part to be performed hereunder, (ii) any other condition of
your obligations hereunder is not fulfilled when due, (iii) the rating assigned
by any nationally recognized statistical rating organization ("Rating
Organization") to the Company, the Operating Partnership or the Securities of
either of them as of or subsequent to the date of this Agreement shall have been
lowered since that date or if such Rating Organization shall have publicly
announced that it has under surveillance or review for the purpose of
considering lowering such rating, its rating of the Company, the Operating
Partnership or the Securities, (iv) trading on the New York Stock Exchange shall
have been wholly suspended, (v) a banking moratorium shall have been declared by
federal or New York or Illinois authorities, or (vi) an outbreak of major
hostilities in which the United States is involved, a declaration of war by
Congress, any other substantial national or international calamity or any other
event or occurrence of a similar character shall have occurred since the
execution of this Underwriting Agreement that, in your
21
judgment, makes it impractical or inadvisable to proceed with the completion of
the sale of and payment for the Securities. Any such termination shall be
without liability of any party to any other party with respect to Securities not
purchased by reason of such termination except that the provisions of Sections
4(g), 6 and 10 hereof shall at all times be effective. If you elect to terminate
this Underwriting Agreement as provided in this Section 9, each of the
Transaction Entities shall be notified promptly by you by telephone, telex or
telecopy, confirmed by letter.
10. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Operating Partnership shall
fail to tender the Securities for delivery to the Underwriters by reason of any
failure, refusal or inability on the part of the Transaction Entities to perform
any agreement on their part to be performed, or because any other condition of
the Underwriters' obligations hereunder required to be fulfilled by the
Transaction Entities is not fulfilled, the Transaction Entities will reimburse
the Underwriters for all reasonable out-of-pocket expenses (including fees and
disbursements of counsel) incurred by the Underwriters in connection with this
Underwriting Agreement and the proposed purchase of the Securities, and upon
demand the Transaction Entities shall pay the full amount thereof to the
Underwriters. If this Underwriting Agreement is terminated pursuant to Section 8
by reason of the default of one or more Underwriters, the Transaction Entities
shall not be obligated to reimburse any defaulting Underwriter on account of
those expenses.
11. NOTICES. All notices or communications hereunder shall be in writing and if
sent to you shall be mailed, delivered, telexed or telecopied and confirmed to
you at 00000 Xxxxx Xxxxxx Xxxxxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000,
c/o Investment Banking, attention: Xxxxx X. Xxxxxxxx (phone 000-000-0000; fax
000-000-0000), (with a copy to Xxxxx X. Xxxxxxxx, Esq., c/o Mayer, Xxxxx &
Xxxxx, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, phone 000-000-0000;
fax 000-000-0000), or if sent to the Operating Partnership, shall be mailed,
delivered, telexed or telecopied and confirmed to Xxxxxx X. X'Xxxx, CEO, or
Xxxxxx X. Xxxxx, Xx., CFO, Xxxxxxx Real Estate, Inc., 00 Xxxxxx Xxxxxxxxx, Xxxxx
000, Xxxxxxxxxx, Xxxxxxxx 00000 (phone 000-000-0000; fax 000-000-0000) (with
copy to Xxxxxxx X. Xxxxx, P.C., c/o Goodwin, Xxxxxxx & Xxxx LLP, Exchange Place,
Boston, MA 02109; phone 000-000-0000; fax 000-000-0000). Any party to this
Underwriting Agreement may change such address for notices by sending to the
other party to this Underwriting Agreement written notice of a new address for
such purpose.
12. PARTIES. This Underwriting Agreement shall inure to the benefit of, and be
binding upon, the Transaction Entities and the Underwriters and our respective
successors and the controlling persons and officers referred to in Section 6(a)
hereof, and no other person will have any right or obligation hereunder.
22
13. APPLICABLE LAW. This Underwriting Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
Very truly yours,
XXXXXXX REAL ESTATE, INC.
By: /s/ Xxxxxx X. Xxxxx, Xx.
---------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Chief Financial Officer
XXXXXXX OPERATING LIMITED PARTNERSHIP
By: XXXXXXX REAL ESTATE, INC.,
its general partner
By: /s/ Xxxxxx X. Xxxxx, Xx.
---------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Chief Financial Officer
This Underwriting Agreement is hereby confirmed and accepted as of the date
first above written.
SUTRO & CO. INCORPORATED
By: /s/ Xxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Director of Investment Banking
DEUTSCHE BANK SECURITIES INC.
By: /s/ Xxxxx X. Xxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxx
Title: Director
By: /s/ Xxxxx Xxxxx
---------------------------------
Name: Xxxxx Xxxxx
Title: Director
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SCHEDULE A
Underwriters Principal Amount of Notes
Sutro & Co. Incorporated $45,000,000
Deutsche Bank Securities Inc. $30,000,000
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$75,000,000
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SCHEDULE B
Principal Amount: $75,000,000.00
Coupon: 8.875%
Settlement Date: March 10, 2000
Price to Public: 99.974% of par
Price to Public: $74,980,500
Underwriting Discount: 0.650% of par
Underwriting Discount: $487,500
Price to Underwriter: 99.324%
Proceeds to the Operating Partnership: $74,493,000
Maturity Date: March 15, 2006
Ratings: Standard & Poor's - BBB-
Xxxxx'x - Baa3
SCHEDULE C
LIST OF SUBSIDIARIES OF TRANSACTION ENTITIES
Xxxxxxx Financing Corp.
Xxxxxxx Financing Partnership
Xxxxxxx Management Corp.
Xxxxxxx Management Limited Partnership
Xxxxxxx Management Limited Liability Company
Xxxxxxx Midwest Management, Inc.
Xxxxxxx Real Estate Management, Inc.
Xxxxxxx Spring Mall, Inc.
Xxxxxxx Spring Mall Limited Partnership
BTR Development Corp.
BTR Development Limited Partnership
Xxxxxxxxxx Square Associates Limited Partnership
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SCHEDULE D
AMOUNT, DATE, TIME AND PLACE OF PAYMENT
FOR THE SECURITIES TO THE OPERATING PARTNERSHIP
$74,493,000, to be paid on March 10, 2000, at 10:00 a.m., Chicago Time, by wire
transfer of immediately available funds against delivery of the Securities at
the offices of Xxxxx, Brown & Xxxxx, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx
00000.
