LEXINGTON REALTY TRUST 4,500,000 SHARES ATM EQUITY OFFERINGSM SALES AGREEMENT
Exhibit 1.2
4,500,000 SHARES
ATM EQUITY OFFERINGSM
December 12, 2008
XXXXXXX LYNCH, PIERCE, XXXXXX
& XXXXX INCORPORATED
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
& XXXXX INCORPORATED
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
LEXINGTON REALTY TRUST, a Maryland real estate investment trust (the “Company”) and THE
LEXINGTON MASTER LIMITED PARTNERSHIP, LEPERCQ CORPORATE INCOME FUND L.P., LEPERCQ CORPORATE INCOME
FUND II L.P. and NET 3 ACQUISITION L.P., each a Delaware limited partnership (each a
“Partnership” and collectively the ‘Partnerships”) confirms its agreement (this
“Agreement”) with XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED (“MLPFS”), as
follows:
1. Issuance and Sale of Shares. The Company agrees that, in its sole discretion and
from time to time during the term of this Agreement, on the terms and subject to the conditions
set forth herein, it may issue and sell through MLPFS, acting as
agent and/or principal, up four million five hundred thousand shares (the “Shares”) of the Company’s common shares of beneficial interest, par
value $0.01 per share (the “Common Shares”). Notwithstanding anything to the contrary
contained herein, the parties hereto agree that compliance with the limitation set forth in this
Section 1 on the number of Shares issued and sold under this Agreement shall be the sole
responsibility of the Company, and MLPFS shall have no obligation in connection with such
compliance. The issuance and sale of Shares through MLPFS will be effected pursuant to the
Registration Statement (as defined below) filed by the Company with the Securities and Exchange
Commission (the “Commission”), although nothing in this Agreement shall be construed as
requiring the Company to use the Registration Statement to issue the Shares.
The Company has filed, in accordance with the provisions of the Securities Act of 1933, as
amended, and the rules and regulations thereunder (collectively, the “Securities Act”),
with the Commission a registration statement on Form S-3 (File No. 333-155586), including a base
prospectus, relating to certain securities, including the Shares to be issued from time to time by
the Company, and which incorporates by reference documents that the Company has filed or will file
in accordance with the provisions of the Securities Exchange Act of 1934, as amended, and the rules
and regulations thereunder (collectively, the “Exchange Act”). The Company has prepared a
prospectus supplement specifically relating to the Shares (the “Prospectus Supplement”) to
the base prospectus included as part of such registration statement. The Company has furnished to
MLPFS, for use by MLPFS, copies of the prospectus included as part of such registration statement,
as supplemented by the Prospectus Supplement, relating to the
Shares. Except where the context otherwise requires, such registration statement, as amended
when it became effective, including all documents filed as part thereof or incorporated by
reference therein, and including any information contained in a Prospectus (as defined below)
subsequently filed with the Commission pursuant to Rule 424(b) under the Securities Act or deemed
to be a part of such registration statement pursuant to Rule 430B of the Securities Act, is herein
called the “Registration Statement.” The base prospectus, including all documents
incorporated therein by reference, included in the Registration Statement, as it may be
supplemented by the Prospectus Supplement, in the form in which such prospectus and/or Prospectus
Supplement have most recently been filed by the Company with the Commission pursuant to Rule 424(b)
under the Securities Act, together with any “issuer free writing prospectus,” as defined in Rule
433 of the Securities Act Regulations (“Rule 433”), relating to the Shares that (i) is
required to be filed with the Commission by the Company or (ii) is exempt from filing pursuant to
Rule 433(d)(5)(i), in each case in the form filed or required to be filed with the Commission or,
if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g),
is herein called the “Prospectus.” Any reference herein to the Registration Statement, the
Prospectus or any amendment or supplement thereto shall be deemed to refer to and include the
documents incorporated by reference therein, and any reference herein to the terms “amend,”
“amendment” or “supplement” with respect to the Registration Statement or the Prospectus shall be
deemed to refer to and include the filing after the execution hereof of any document with the
Commission deemed to be incorporated by reference therein. For purposes of this Agreement, all
references to the Registration Statement, the Prospectus or to any amendment or supplement thereto
shall be deemed to include any copy filed with the Commission pursuant to its Electronic Data
Gathering Analysis and Retrieval System (“XXXXX”).
2. Placements. Each time that the Company wishes to issue and sell Shares hereunder
(each, a “Placement”), it will notify MLPFS by email notice (or other method mutually
agreed to in writing by the parties) containing the parameters in accordance with which it desires
the Shares to be sold, which shall at a minimum include the number of Shares to be issued (the
“Placement Shares”), the time period during which sales are requested to be made, any
limitation on the number of Shares that may be sold in any one day and any minimum price below
which sales may not be made (a “Placement Notice”), a form of which containing such minimum
sales parameters necessary is attached hereto as Schedule 1. The Placement Notice shall
originate from any of the individuals from the Company set forth on Schedule 2 (with a copy
to each of the other individuals from the Company listed on such schedule), and shall be addressed
to each of the individuals from MLPFS set forth on Schedule 2, as such Schedule 2
may be amended from time to time. The Placement Notice shall be effective upon receipt by MLPFS
unless and until (i) in accordance with the notice requirements set forth in Section 4,
MLPFS declines to accept the terms contained therein for any reason, in its sole discretion, (ii)
the entire amount of the Placement Shares have been sold, (iii) in accordance with the notice
requirements set forth in Section 4, the Company suspends or terminates the Placement
Notice, (iv) the Company issues a subsequent Placement Notice with parameters superseding those on
the earlier dated Placement Notice, or (v) the Agreement has been terminated under the provisions
of Section 11. The amount of any discount, commission or other compensation to be paid by
the Company to MLPFS in connection with the sale of the Placement Shares shall be calculated in
accordance with the terms set forth in Schedule 3. It is expressly acknowledged and agreed
that neither the Company nor MLPFS will have any obligation whatsoever with
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respect to a Placement or any Placement Shares unless and until the Company delivers a
Placement Notice to MLPFS and MLPFS does not decline such Placement Notice pursuant to the terms
set forth above, and then only upon the terms specified therein and herein. In the event of a
conflict between the terms of this Agreement and the terms of a Placement Notice, the terms of the
Placement Notice will control.
3. Sale of Placement Shares by MLPFS. Subject to the terms and conditions herein
set forth, upon the Company’s issuance of a Placement Notice, and unless the sale of the Placement
Shares described therein has been declined, suspended, or otherwise terminated in accordance with
the terms of this Agreement, MLPFS, for the period specified in the Placement Notice, will use its
commercially reasonable efforts consistent with its normal trading and sales practices to sell such
Placement Shares up to the amount specified, and otherwise in accordance with the terms of such
Placement Notice. MLPFS will provide written confirmation to the Company no later than the opening
of the Trading Day (as defined below) immediately following the Trading Day on which it has made
sales of Placement Shares hereunder setting forth the number of Placement Shares sold on such day,
the compensation payable by the Company to MLPFS pursuant to Section 2 with respect to such
sales, and the Net Proceeds (as defined below) payable to the Company, with an itemization of the
deductions made by MLPFS (as set forth in Section 5(a)) from the gross proceeds that it
receives from such sales. After consultation with the Company and subject to the terms of the
Placement Notice, MLPFS may sell Placement Shares by any method permitted by law deemed to be an
“at the market” offering as defined in Rule 415 of the Securities Act, including without limitation
sales made directly on the New York Stock Exchange (the “Exchange”), on any other existing
trading market for the Common Shares or to or through a market maker. After consultation with the
Company and subject to the terms of the Placement Notice, MLPFS may also sell Placement Shares in
privately negotiated transactions. The Company acknowledges and agrees that (i) there can be no
assurance that MLPFS will be successful in selling Placement Shares, and (ii) MLPFS will incur no
liability or obligation to the Company or any other person or entity if it does not sell Placement
Shares for any reason other than a failure by MLPFS to use its commercially reasonable efforts
consistent with its normal trading and sales practices to sell such Placement Shares as required
under this Section 3. For the purposes hereof, “Trading Day” means any day on
which the Common Shares are purchased and sold on the principal market on which the Common Shares
are listed or quoted.
4. Suspension of Sales. The Company or MLPFS may, upon notice to the other party in
writing (including by email correspondence to each of the individuals of the other party set forth
on Schedule 2, if receipt of such correspondence is actually acknowledged by any of the
individuals to whom the notice is sent, other than via auto-reply) or by telephone (confirmed
immediately by verifiable facsimile transmission or email correspondence to each of the individuals
of the other party set forth on Schedule 2), suspend any sale of Placement Shares;
provided, however, that such suspension shall not affect or impair either party’s obligations with
respect to any Placement Shares sold hereunder prior to the receipt of such notice. Each of the
parties agrees that no such notice under this Section 4 shall be effective against the
other unless it is made to one of the individuals named on Schedule 2 hereto, as such
Schedule may be amended from time to time.
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5. Settlement.
(a) Settlement of Placement Shares. Unless otherwise specified in the applicable
Placement Notice, settlement for sales of Placement Shares will occur on the third (3rd)
Trading Day (or such earlier day as is industry practice for regular-way trading) following the
date on which such sales are made (each, a “Settlement Date”). The amount of proceeds to
be delivered to the Company on a Settlement Date against receipt of the Placement Shares sold (the
“Net Proceeds”) will be equal to the aggregate sales price received by MLPFS at which such
Placement Shares were sold, after deduction for (i) MLPFS’s commission, discount or other
compensation for such sales payable by the Company pursuant to Section 2 hereof, and (ii)
any transaction fees imposed by any governmental or self-regulatory organization in respect of such
sales required to be paid by MLPFS on behalf of the Company.
(b) Delivery of Placement Shares. On or before each Settlement Date, the Company
will, or will cause its transfer agent to, electronically transfer the Placement Shares being sold
by crediting MLPFS’s or its designee’s account (provided MLPFS shall have given the Company written
notice of such designee prior to the Settlement Date) at The Depository Trust Company through its
Deposit and Withdrawal at Custodian System or by such other means of delivery as may be mutually
agreed upon by the parties hereto which in all cases shall be freely tradeable, transferable,
registered shares in good deliverable form. On each Settlement Date, MLPFS will deliver the
related Net Proceeds in same day funds to an account designated by the Company on, or prior to, the
Settlement Date. The Company agrees that if the Company, or its transfer agent (if applicable),
defaults in its obligation to deliver Placement Shares on a Settlement Date, that in addition to
and in no way limiting the rights and obligations set forth in Section 9(a)
(Indemnification and Contribution) hereof but subject to Section 9(c) hereof, it will
(i) hold MLPFS harmless against any loss, claim, damage, or expense (including reasonable legal
fees and expenses), as incurred, arising out of or in connection with such default by the Company
and (ii) pay to MLPFS any commission, discount, or other compensation to which it would otherwise
have been entitled absent such default.
6. Representations and Warranties of the Company and the Partnerships. The Company
and each of the Partnerships jointly and severally represents and warrants to, and agrees with,
MLPFS that as of the date of this Agreement and as of each Representation Date (as defined in
Section 7(n) below) on which a certificate is required to be delivered pursuant to
Section 7(n) of this Agreement and as of each Applicable Time, as the case may be:
(a) The Company satisfies all of the requirements of the Securities Act for use of Form S-3
for the offering of the Shares contemplated hereby. At the time of the initial filing of the
Registration Statement, at the time of the most recent amendment thereto for the purposes of
complying with Section 10(a)(3) of the Securities Act (whether such amendment was by post-effective
amendment, incorporated report filed pursuant to Section 13 or 15(d) of the Exchange Act or form of
prospectus), at the time the Company or any person acting on its behalf (within the meaning, for
this clause only, of Rule 163(c) of the Securities Act) made any offer relating to the Shares in
reliance on the exemption of Rule 163 of the Securities Act and at the date hereof, the Company was
and is a “well-known seasoned issuer” as defined in Rule 405 of the Securities Act, including not
having been and not being an “ineligible issuer,” as defined in Rule 405 of the Securities Act. The
Registration Statement is an “automatic shelf registration statement,” as
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defined in, and as determined in accordance with, Rule 405 of the Securities Act, and the
Shares, since their registration on the Registration Statement, have been and remain eligible for
registration by the Company on a Rule 405 “automatic shelf registration statement.” The Company has
not received from the Commission any notice pursuant to Rule 401(g)(2) of the Securities Act
objecting to the use of the automatic shelf registration statement form. The Company has paid the
required Commission filing fees relating to the Shares within the time required by Rule
456(b)(1)(i) of the Securities Act without regard to the proviso therein and otherwise in
accordance with Rules 456(b) and 457(r) of the Securities Act (including, if applicable, by
updating the “Calculation of Registration Fee” table in accordance with Rule 456(b)(1)(ii) of the
Securities Act either in a post-effective amendment to the Registration Statement or on the cover
page of the Prospectus).
(b) The Registration Statement became effective upon filing under Rule 462(e) of the
Securities Act on November 21, 2008, and any post-effective amendment thereto also became effective
upon filing under Rule 462(e). No stop order suspending the effectiveness of the Registration
Statement has been issued under the Securities Act and no proceedings for that purpose have been
instituted or are pending or, to the knowledge of the Company, are contemplated by the Commission,
and any request on the part of the Commission for additional information has been complied with.
(c) At the respective times the Registration Statement and each amendment thereto became
effective, at each deemed effective date with respect to MLPFS pursuant to Rule 430B(f)(2) of the
Securities Act, as the case may be, the Registration Statement complied and will comply in all
material respects with the requirements of the Securities Act, and did not and will not contain an
untrue statement of a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
(d) Neither any issuer free writing prospectus (as defined in Rule 433) relating to the
Shares, nor the Prospectus nor any amendments or supplements thereto, considered together, at the
time the Prospectus or any such amendment or supplement was issued, as of the date hereof, each
Applicable Time and at each Representation Date, as the case may be, included or will include an
untrue statement of a material fact or omitted or will omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under which they were made,
not misleading.
(e) Each document incorporated by reference in the Registration Statement or the Prospectus
heretofore filed, when it was filed (or, if any amendment with respect to any such document was
filed, when such amendment was filed), conformed in all material respects with the requirements of
the Exchange Act and the rules and regulations thereunder, and any further documents so filed and
incorporated after the date of this Agreement will, when they are filed, conform in all material
respects with the requirements of the Exchange Act and the rules and regulations thereunder; no
such document when it was filed (or, if an amendment with respect to any such document was filed,
when such amendment was filed), contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made not misleading; and no such
document, when it is filed, will contain an untrue statement of a material fact or will omit to
state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under which they were
made, not misleading.
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(f) The Company does not own or control, directly or indirectly, any corporation, association
or other entity other than the subsidiaries listed in Exhibit 21 to the Company’s Annual Report on
Form 10-K for the most recently ended fiscal year and other than (i) those subsidiaries not
required to be listed on Exhibit 21 by Item 601 of Regulation S-K under the Exchange Act and
(ii) those subsidiaries formed since the last day of the most recently ended fiscal year (each a
“Subsidiary” and collectively, the Subsidiaries”).
(g) Each of the Company, the Subsidiaries and the Partnerships (each individually a
“Lexington Entity” and collectively the “Lexington Entities”) are duly organized
and validly existing in good standing under the laws of the state of its incorporation or
organization with full corporate, partnership or entity power and authority, as the case may be, to
own, lease and operate its properties and to conduct its business as presently conducted and as
described in the Prospectus and is duly registered and qualified to conduct its business and is in
good standing in each jurisdiction or place where the nature of its properties or the conduct of
its business requires such registration or qualification, except where the failure to so register
or qualify would not have a material adverse effect on the condition (financial or other),
business, properties, prospects, or results of operations of any of the Lexington Entities, taken
as a whole (a “Material Adverse Effect”).
(h) All of the outstanding shares of beneficial interest of the Company have been duly
authorized and are validly issued, fully paid, non-assessable (except as otherwise described in the
Prospectus) and free of preemptive or similar rights or other rights to subscribe for or to
purchase securities provided for by law or by the declaration of trust, as amended and supplemented
or the by-laws, as amended, of the Company; the Shares to be issued and sold pursuant to this
Agreement have been duly authorized and, when issued and delivered against payment therefor as
provided hereunder, will have been validly issued and will be fully paid, non-assessable (except as
otherwise described in the Prospectus) and free of preemptive or similar rights; all outstanding
Common Shares, (except for shares issued pursuant to the Company’s incentive share award plans) are
listed on the Exchange and the Company knows of no reason or set of facts which is likely to result
in the delisting of such Common Shares or the inability to list the Shares; and there are no rights
of holders of securities of the Company to the registration of Common Shares or other securities
that would require inclusion of such Common Shares or other securities in the offering of the
Shares.
(i) All of the outstanding shares of beneficial interest of, or other ownership interests in
each of the Subsidiaries have been duly authorized and validly issued and, except as to the
Subsidiaries that are partnerships, non-assessable, and, except as disclosed in the Prospectus, are
or will be owned, directly or indirectly, by the Company free and clear of any security interest,
claim, lien, encumbrance preemptive or similar nights or adverse interest of any nature. The
issued and outstanding units of partnership interest in the Partnerships owned directly or
indirectly by the Company (the “Partnership Units”) have been duly authorized and validly
issued by each Partnership free and clear of any security interest, claim, lien, encumbrance or
Partnerships or adverse interest of any nature.
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(j) All of the issued and outstanding shares of beneficial interest of the Company and the
Subsidiaries and the outstanding Partnership Units have been offered, sold and issued by the
relevant Lexington Entity in compliance with all applicable laws, including without limitation,
federal and state securities laws.
(k) Except as described in the Prospectus, there is no litigation, action, suit, or
proceeding by or before any court or governmental or other regulatory or administrative agency or
commission pending or, to the Company’s knowledge, threatened, to which any of the Lexington
Entities is a party before any court or governmental agency or body, which might individually or in
the aggregate prevent or adversely affect the consummation of this Agreement or the issuance,
purchase and sale of the Shares or result in a Material Adverse Effect.
(l) There are no material agreements, contracts, indentures, leases or other instruments that
are required to be described in the Prospectus or to be filed as an exhibit to the Registration
Statement that are not described, filed or incorporated by reference in the Registration Statement
and the Prospectus as required by the Securities Act. All such contracts to which any of the
Lexington Entities is a party have been duly authorized, executed and delivered by the relevant
Lexington Entity, constitute valid and binding agreements of the Company or the applicable
subsidiary and are enforceable against the relevant Lexington Entity, in accordance with the terms
thereof, except as enforceability thereof may be limited by (i) the application of bankruptcy,
reorganization, insolvency and other laws affecting creditors’ rights generally and/or (ii)
equitable principles being applied at the discretion of a court before which any proceeding may be
brought (regardless of whether enforcement is sought in a proceeding in equity or at law). None of
the Lexington Entities have received notice that any of the Lexington Entities is in breach of or
default under any of such contracts.
(m) None of the Lexington Entities are (i) in violation of (A) their Organizational
Documents, (B) to each of the Lexington Entities’ knowledge any law, ordinance, administrative or
governmental rule or regulation applicable to the Lexington Entities, the violation of which would
have a Material Adverse Effect or (C) any decree of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries, or the Partnerships; or (ii) except as
disclosed in the Prospectus, in default in any material respect in the performance of any
obligation, agreement or condition contained in (A) any bond, debenture, note or any other evidence
of indebtedness or (B) any agreement, indenture, lease or other instrument (each of (A) and (B), an
“Existing Instrument”) to which any of the Lexington Entities are a party or by which any
of their properties may be bound, which default would have a Material Adverse Effect; and there
does not exist any state of facts that constitutes a default or an event of default on the part of
any of the Lexington Entities as defined in such documents or that, with notice or lapse of time or
both, would constitute such a default or event of default which would have a Material Adverse
Effect.
(n) The Company and the Partnerships have full legal right, power and authority to enter
into and perform this Agreement and to consummate the transactions contemplated herein, including
the issuance, sale and delivery of the Shares as provided herein. This Agreement has been duly
authorized, executed and delivered by the Company and the Partnerships and constitutes a valid and
legally binding agreement of the Company and the Partnerships and is enforceable against the
Company and the Partnerships in accordance with its terms, except to the
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extent enforceability may be limited by (i) the application of bankruptcy, reorganization,
insolvency and other laws affecting creditors’ rights generally and/or (ii) equitable principles
being applied at the discretion of a court before which any proceeding may be brought (regardless
of whether enforcement is sought in a proceeding in equity or at law), and except as rights to
indemnity and contribution hereunder may be limited by federal or state securities laws.
(o) No consent, approval, authorization, order, license, certificate, permit, registration,
designation or filing by, with or from any governmental agency or body having jurisdiction over
any of the Lexington Entities, or any of their respective properties or assets is required for the
execution, delivery and performance by the Company or the Partnerships of their obligations under
this Agreement and the consummation by the Company of the transactions contemplated hereby,
including the valid authorization, issuance, sale and delivery of the Shares pursuant to the
Agreement, except such as have been obtained or made and such as may be required by the Exchange
and the securities or Blue Sky or real estate syndication laws of the various states in connection
with the offer and sale of the Shares.
(p) Neither the issuance and sale of the Shares by the Company, the execution, delivery or
performance of this Agreement by the Company or the Partnerships, nor the consummation by the
Company of the transactions contemplated hereby (i) conflicts with or will conflict with or
constitutes or will constitute a breach of, or a default under, the declaration of trust, as
amended and supplemented, or the by-laws, as amended, of the Company or the Organizational
Documents of any of the Lexington Entities, or any Existing Instrument to which the Company or any
of its subsidiaries is a party or by which any of its or their properties may be bound, (ii)
violates any statute, law, regulation, ruling, filing, judgment, injunction, order or decree
applicable to the Company, any of its subsidiaries, the Partnerships or any of their properties, or
(iii) results in a Debt Repayment Triggering Event (as defined below) under, or results in the
creation or imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to, or requires the consent of any other party to, any
Existing Instrument, except for such conflicts, breaches, defaults, violations, liens, charges or
encumbrances that, in the case of (i), (ii) and (iii) will not, individually or in the aggregate,
result in a Material Adverse Effect. As used herein, a “Debt Repayment Triggering Event”
means any event or condition that gives, or with the giving of notice or lapse of time would give,
the holder of any note, debenture or other evidence of indebtedness (or any person acting on such
holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion
of such indebtedness by the Company or any of its subsidiaries prior to the stated maturity date
thereof.
(q) KPMG LLP, the accounting firm that has certified the audited financial statements
(including the related notes thereto and supporting schedules) of the Lexington Entities
incorporated by reference in the Registration Statement and the Prospectus, is and was, during the
periods covered by its reports incorporated by reference in the Registration Statement and the
Prospectus, an independent registered public accounting firm as required by the Securities Act, the
Exchange Act and the Public Company Accounting Oversight Board in the United States
(“PCAOB”).
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(r) The financial statements of the Lexington Entities, together with the related schedules
and notes thereto, included or incorporated by reference in the Registration Statement
and the Prospectus, comply as to form in all material respects with the requirements of the
Securities Act. Such financial statements of the Lexington Entities, together with the related
schedules and notes thereto, present fairly, in all material respects, the consolidated financial
position, results of operations, shareholders’ equity and changes in financial position of the
Lexington Entities, at the dates or for the respective periods therein specified and have been
prepared in accordance with GAAP consistently applied throughout the periods involved.
(s) Except as otherwise disclosed in the Prospectus or made publicly available, subsequent
to the respective dates as of which such information is given in the Registration Statement and the
Prospectus, (i) there has been no Material Adverse Effect or any development that may reasonably be
expected to result in a Material Adverse Effect, (ii) there have been no material transactions
entered into by the any of the Lexington Entities, on a consolidated basis, other than transactions
in the ordinary course of business, (iii) none of the Lexington Entities have incurred any material
liabilities or obligations, direct or contingent, (iv) the Lexington Entities, on a consolidated
basis, have not, other than regular quarterly dividends, declared, paid or made a material dividend
or distribution of any kind on any class of its shares of beneficial interest (other than dividends
or distributions from wholly owned Subsidiaries), (v) the Company is not in default under the terms
of any class of capital shares of the Company or any outstanding debt obligations, if any, which
would result in a Material Adverse Effect, (vi) there has not been any change in the authorized or
outstanding capital stock of the Company (other than (x) the issuance of Common Shares to the
trustees, employees and officers of the Company pursuant to the Company’s incentive share award
plans and upon exchange or conversion of other outstanding securities and (y) the issuance of
Common Shares pursuant to the Sales Agreement, dated as of the date hereof, among Cantor Xxxxxxxxxx
& Co., the Company, and the Partnerships (the “CF&Co Sales Agreement”)) and (vii) there has
not been any material increase in the short-term or long-term debt (including capitalized lease
obligations but excluding borrowings under existing or future bank lines of credit) of the
Lexington Entities, on a consolidated basis.
(t) The Company has not distributed and will not distribute any offering material in
connection with the offering and sale of the Shares to be sold hereunder by MLPFS as principal or
agent for the Company, other than the Prospectus and the Registration Statement.
(u) The Company has not taken and will not take prior to the later of the termination of
this Agreement or the Settlement Date of the last sale of any Placement Shares hereunder, directly
or indirectly, any action that is not permitted under Section 7(q) hereof.
(v) The Lexington Entities have filed all material tax returns required to be filed other
than those being contested in good faith (and other than certain state or local tax returns, as to
which the failure to file, individually or in the aggregate, would not have a Material Adverse
Effect), and the Lexington Entities are not in default in the payment of any material taxes that
were payable pursuant to said returns or any assessments with respect thereto other than those
being contested in good faith and for which adequate reserves have been provided; no tax deficiency
has been asserted against the Lexington Entities, nor, to the knowledge of the trustees and
officers of the Company is any tax deficiency likely to be asserted against the Lexington Entities;
and all tax liabilities, if any, are adequately provided for on the respective books of the
entities.
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(w) Except as set forth in the Prospectus, there are no transactions with “affiliates” (as
defined in Rule 405 promulgated under the Securities Act) or any officer, director, trustee or
security holder of the Company (whether or not an affiliate) that are required by the Securities
Act to be disclosed in the Prospectus that have not been disclosed as required. Additionally, no
relationship, direct or indirect, exists between the Lexington Entities on the one hand, and the
directors, trustees, officers, stockholders, customers or suppliers of the Lexington Entities on
the other hand that is required by the Securities Act to be disclosed in the Prospectus that is not
so disclosed. Except as disclosed in the Prospectus, there are no material outstanding loans or
advances or material guarantees of indebtedness by any of the Lexington Entities to or for the
benefit of any of the officers, trustees or directors of the Lexington Entities or any of the
members of the families of any of them.
(x) None of the Lexington Entities is an “investment company”, a company “controlled” by an
“investment company” or an “affiliated person” of, or “promoter” or “principal underwriter” for, an
investment company within the meaning of the Investment Company Act of 1940, as amended, or an
“investment advisor” as such term is defined in the Investment Advisers Xxx 0000, as amended.
(y) Except as otherwise disclosed in the Prospectus or made publicly available, the Lexington
Entities have good and marketable fee or leasehold title to all real properties and all other
properties and assets owed by them (each a “Property” and collectively, the
“Properties”), described in the Prospectus as being owned or leased by them, free and clear
of all liens, claims, encumbrances and restrictions, except liens for taxes not yet due and payable
and other liens, claims, encumbrances and restrictions which do not, either individually or in the
aggregate, have a Material Adverse Effect. Except as otherwise set forth in the Prospectus, all
leases to which any of the Lexington Entities are a party, which are material to the business of
the Lexington Entities, taken as a whole, are valid and binding. Except as otherwise set forth in
the Prospectus, no default under any such lease by the Lexington Entities or, to the Company’s
knowledge, any tenant has occurred and is continuing which default would, individually or in the
aggregate, have a Material Adverse Effect. With respect to all properties owned or leased by any of
the Lexington Entities, the Lexington Entities have such documents, instruments, certificates,
opinions and assurances, including without limitation, fee, leasehold owners or mortgage title
insurance policies (disclosing no encumbrances or title exceptions which are material to the
Lexington Entities considered as a whole, except as otherwise set forth in the Prospectus), legal
opinions and property insurance policies in each case in form and substance as are usual and
customary in transactions involving the purchase of similar real estate and are appropriate for the
Lexington Entities to have obtained; provided that in the case of title insurance, the relevant
Lexington Entity has obtained an owner’s title insurance policy in an amount of least equal to the
cost of acquisition from a title insurance company with respect to each of its real estate
properties and has obtained a commitment to obtain such an owner’s title insurance policy with
respect to each pending property acquisition. No person has an option or right of first refusal to
purchase all or part of any Property or any proposed acquisition or any interest therein for other
than the fair market value except where the exercise of such option or right would not have a
Material Adverse Effect. None of the Lexington Entities have knowledge of any pending or
threatened condemnation proceeding, zoning change, or other proceeding or action that will in any
manner affect the size of, use of, improvements on, construction on or access to any of the
Properties.
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(z) The Company has established and maintains disclosure controls and other procedures (as
such term is defined in Rule 13a-15 and 15d-15 under the Exchange Act) that (a) are designed to
ensure that material information relating to any of the Lexington Entities, is made known to the
Company’s Chief Executive Officer and Chief Financial Officer (or persons performing similar
functions) by others within those entities particularly during the periods in which the filings
made by the Company with the Commission which it may make under Sections 13(a), 13(c), 14 or 15(d)
of the 1934 Act are being prepared, (b) have been evaluated for effectiveness as of the end of the
period covered by the Company’s most recent Annual Report on Form 10-K filed with the Commission,
(c) are effective to perform the functions for which they were established and (d) the principal
executive officers (or their equivalents) and principal financial officers (or their equivalents)
of the Company have made all certifications required by Sections 302 and 906 of the Xxxxxxxx-Xxxxx
Act of 2002 and any related rules and regulations promulgated by the Commission, and the statements
contained in any such certification were correct when made. The Company’s accountants and the
audit committee of the board of trustees of the Company have been advised of (x) any significant
deficiencies in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the Company’s ability to record, process, summarize, and
report financial data and (y) any fraud, whether or not material, that involves management or other
employees who have a role in the Company’s internal control over financial reporting. Since the
date of the most recent evaluation of such disclosure controls and procedures, there have been no
significant changes in the Company’s internal control over financial reporting or in other factors
that have materially affected or are reasonably likely to materially affect the Company’s internal
control over financial reporting.
(aa) To the Company’s and each Partnership’s knowledge, the system of internal accounting
controls of the Lexington Entities, taken as a whole, is sufficient to meet the broad objectives of
internal accounting controls insofar as those that would be material in relation to the Company’s
financial statements; and, to the Company’s and each Partnership’s knowledge, none of the Lexington
Entities, nor any employee or agent thereof, has made any payment of funds of any of the Lexington
Entities, as the case may be, or received or retained any funds, and no funds of any of the
Lexington Entities, as the case may be, have been set aside to be used for any payment, in each
case in violation of any law, rule or regulation.
(bb) None of the Lexington Entities nor, to the knowledge of the Company, any officer,
trustee or director purporting to act on behalf of any of the Lexington Entities, has at any time:
(i) made any contributions to any candidate for political office, or failed to disclose fully any
such contributions, in violation of law; (ii) made any payment of funds to, or received or retained
any funds from, any state, federal or foreign governmental officer or official, or other person
charged with similar public or quasi-public duties, other than payments required or allowed by
applicable law; or (iii) engaged in any transactions, maintained any bank accounts or used any
corporate funds except for transactions, bank accounts and funds, which have been and are reflected
in the normally maintained books and records of the Lexington Entities.
(cc) Except as otherwise set forth in the Prospectus, to the Company’s knowledge (i) the
Lexington Entities have been and are in compliance in all material respects with, and none of the
Lexington Entities have any liability under, applicable Environmental Laws (as hereinafter
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defined) except for such non-compliance or liability which would not have a Material Adverse
Effect; (ii) none of the Lexington Entities have received any written notice of, or has any
knowledge of any occurrence or circumstance which, with notice or passage of time or both, would
give rise to a claim under or pursuant to any Environmental Law by any governmental or
quasi-governmental body or any third party with respect to the real properties or the assets of the
Lexington Entities or arising out of their conduct, except for such claims that would not be
reasonably likely to cause the Lexington Entities to incur liability which has a Material Adverse
Effect and that would not be required to be disclosed in the Prospectus; (iii) none of the real
properties owned by any of the Lexington Entities is included or proposed for inclusion on the
National Priorities List issued pursuant to CERCLA (as defined below) by the United States
Environmental Protection Agency (the “EPA”) or on any similar list or inventory issued by any other
federal, state or local governmental authority having or claiming jurisdiction over such properties
pursuant to any other Environmental Law other than such inclusions or proposed inclusions as would
not be reasonably likely to cause a Material Adverse Effect. As used herein, “Hazardous
Material” shall include, without limitation, any flammable explosives, radioactive materials,
chemicals, hazardous wastes, toxic substances, petroleum or petroleum products, asbestos-containing
materials, mold or any hazardous material as defined by any federal, state or local law, ordinance,
rule or regulation relating to the protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or
wildlife, including, without limitation, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, 42 U.S.C. Secs. 9601-9675 (“CERCLA”), the Hazardous Materials
Transportation Act, as amended, 49 U.S.C. Secs. 5101-5127, the Resource Conservation and Recovery
Act, as amended, 42 U.S.C. Secs. 6901-6992k, the Emergency Planning and Community Right-to-Know Act
of 1986, 42 U.S.C. Secs. 11001-11050, the Toxic Substances Control Act, 15 U.S.C. Secs. 2601-2671,
the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. Secs. 136-136y, the Clean Air Act,
42 U.S.C. Secs. 7401-7642, the Clean Water Act (Federal Water Pollution Control Act), 33 U.S.C.
Secs. 1251-1387, and the Safe Drinking Water Act, 42 U.S.C. Secs. 300f-300j-26, as any of the above
statutes may be amended from time to time, and the regulations promulgated pursuant to any of the
foregoing (individually, an “Environmental Law” and collectively “Environmental
Laws”).
(dd) None of the entities which prepared appraisals of the Properties or Phase I
environmental assessment reports with respect to such Properties was employed for such purpose on a
contingent basis or has any substantial interest in any of the Lexington Entities, and none of
their directors, officers or employees is connected with any of the Lexington Entities as a
promoter, selling agent, voting trustee, officer or employee.
(ee) Each of the Company, the Subsidiaries and the Partnerships has such permits, licenses,
franchises, certificates, consents, order, approvals, and authorizations of governmental or
regulatory authorities (together, “Permits”), including, without limitation, under any
applicable Environmental Law, as are necessary to own, lease and operate its properties and to
engage in the business currently conducted by it, except such permits as to which the failure to
own or possess will not in the aggregate have a Material Adverse Effect. All such Permits are in
full force and effect and each of the Company, and the Partnerships, the Subsidiaries are in
compliance with the terms and conditions of all such Permits, except where the invalidity of such
Permits or the failure of such Permits to be in full force and effect or the failure to comply with
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such permits will not have a Material Adverse Effect. None of the Lexington Entities have
received any notice of proceedings relating to the revocation or modification of any permit which,
singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would
have a Material Adverse Effect.
(ff) The Company has been organized and has operated in conformity with the requirements
for qualification and taxation as a real estate investment trust under the Internal Revenue Code of
1986, as amended (the “Code”) for its taxable years ended December 31, 1993 through
December 31, 2007, and the Company’s current and proposed method of operation will enable it to
continue to meet the requirements for taxation as a real estate investment trust under the Code for
its taxable year ending December 31, 2008 and in the future. The subsidiaries of the Company that
are partnerships have been and will continue to be treated as partnerships or disregarded entities
for federal income tax purposes and not as corporations, associations taxable as corporations or as
publicly traded partnerships.
(gg) The Lexington Entities own, or possess adequate rights to use each material trade
name, trademark, service xxxx, patent, copyright, approval, trade secret and other similar rights
(collectively “Intellectual Property”) necessary for the Lexington Entities to conduct
their respective businesses as described in the Registration Statement and the Prospectus; and none
of the Lexington Entities have received any notice of conflict with, or infringement of, the
asserted rights of others with respect to any Intellectual Property (other than conflicts or
infringements that, if proven, would not individually or in the aggregate have a Material Adverse
Effect), and none of the Lexington Entities knows of any basis therefore.
(hh) Each of the Lexington Entities maintain insurance with insurers of recognized
financial responsibility against such losses and risks and in such amounts as are adequate in
accordance with customary industry practice to protect the Lexington Entities and their respective
businesses; and none of the Lexington Entities has 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, except as disclosed in the Prospectus.
(ii) Except as referred to or described in the Prospectus or as otherwise publicly
available, none of the Subsidiaries or the Partnerships owns any shares of stock or any other
securities of any corporation or has any equity interest in any firm, partnership, association or
other entity other than the issued capital shares of or interests in its subsidiaries, and the
Company does not own, directly or indirectly, any shares of stock or any other securities of any
corporation or have any equity interest in any firm, partnership, association or other entity other
than the issued capital shares of or interests in the Subsidiaries or the Partnerships, except in
each case for non-controlling positions acquired in the ordinary course of business.
(jj) Other than this Agreement, there are no contracts, agreements or understandings between
any of the Lexington Entities and any person that would give rise to a valid claim against any of
the Lexington Entities or MLPFS for a brokerage commission, finder’s fee or other like payment with
respect to the consummation of the transactions contemplated by this Agreement.
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(kk) Except as described in the Prospectus or as otherwise publicly available, there are no
contracts, agreements or understandings between the Lexington Entities and any person granting such
person the right to require the Company to file a registration statement under the Securities Act
with respect to any securities of the Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other registration statement filed
by the Company under the Securities Act.
(ll) The Company does not have any liabilities under the Employee Retirement Income Security
Act of 1974, as amended, or Section 4975 of the Code that might have a Material Adverse Effect.
(mm) No labor dispute with the employees of any of the Lexington Entities exists or, to the
knowledge of the Company, is imminent that might have a Material Adverse Effect.
(nn) The Company acknowledges and agrees that MLPFS has informed the Company that MLPFS may,
to the extent permitted under the Securities Act and the Exchange Act, purchase and sell Common
Shares for its own account while this Agreement is in effect and (ii) the Company shall not be
deemed to have authorized or consented to any such purchases or sales by MLPFS.
(oo) Any certificate signed by an officer of the Company and delivered to MLPFS or to counsel
for MLPFS pursuant to this Agreement shall be deemed to be a representation and warranty by the
Company to MLPFS as to the matters set forth therein.
(pp) The Company acknowledges that MLPFS and, for purposes of the opinions to be delivered
pursuant to Section 7 hereof, counsel to the Company and counsel to MLPFS, will rely upon
the accuracy and truthfulness of the foregoing representations and hereby consents to such
reliance.
(qq) In connection with the offering of the Placement Shares, the Company has not offered and
will not offer its Shares or any other securities convertible into or exchangeable or exercisable
for Shares in a manner in violation of the Exchange Act or the Securities Act; the Company has not
distributed and will not distribute any Prospectus or other offering material in connection with
the offer and sale of the Placement Shares, except as contemplated herein.
7. Covenants of the Company. The Company and each of the Partnerships jointly and
severally covenant and agree with MLPFS that:
(a) Registration Statement Amendments; Payment of Fees. After the date of this
Agreement and during any period in which the Prospectus relating to any Placement Shares is
required to be delivered by MLPFS under the Securities Act (including in circumstances where such
requirement may be satisfied pursuant to Rule 172 under the Securities Act), (i) the Company will
notify MLPFS promptly of the time when any subsequent amendment to the Registration Statement,
other than documents incorporated by reference, has been filed with the Commission and/or has
become effective or any subsequent supplement to the Prospectus has been filed and of any comment
letter from the Commission or any request by the Commission for any amendment or supplement to the
Registration Statement or Prospectus or for additional
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information, (ii) the Company will prepare and file with the Commission, promptly upon MLPFS’s
request, any amendments or supplements to the Registration Statement or Prospectus that, in MLPFS’s
reasonable opinion, may be necessary or advisable in connection with the distribution of the
Placement Shares by MLPFS (provided, however, that the failure of MLPFS to make such request shall
not relieve the Company of any obligation or liability hereunder, or affect MLPFS’s right to rely
on the representations and warranties made by the Company in this Agreement); (iii) the Company
will not file any amendment or supplement to the Registration Statement or Prospectus, other than
documents incorporated by reference, relating to the Placement Shares or a security convertible
into the Placement Shares unless a copy thereof has been submitted to MLPFS within a reasonable
period of time before the filing and MLPFS has not reasonably objected thereto (provided, however,
that the failure of MLPFS to make such objection shall not relieve the Company of any obligation or
liability hereunder, or affect MLPFS’s right to rely on the representations and warranties made by
the Company in this Agreement) and the Company will furnish to MLPFS at the time of filing thereof
a copy of any document that upon filing is deemed to be incorporated by reference into the
Registration Statement or Prospectus, except for those documents available via XXXXX; and (iv) the
Company will cause each amendment or supplement to the Prospectus, other than documents
incorporated by reference, to be filed with the Commission as required pursuant to the applicable
paragraph of Rule 424(b) of the Securities Act (without reliance on Rule 424(b)(8) of the
Securities Act).
(b) Notice of Commission Stop Orders. The Company will advise MLPFS, promptly after
it receives notice or obtains knowledge thereof, of the issuance or threatened issuance by the
Commission of any stop order suspending the effectiveness of the Registration Statement or any
other order preventing or suspending the use of the Prospectus, of the suspension of the
qualification of the Placement Shares for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceeding for any such purpose or any examination pursuant to
Section 8(e) of the Securities Act, or if the Company becomes the subject of a proceeding under
Section 8A of the Securities Act in connection with the offering of the Shares; and it will
promptly use its commercially reasonable efforts to prevent the issuance of any stop or other order
or to obtain its withdrawal if such a stop or other order should be issued.
(c) Delivery of Prospectus; Subsequent Changes. During any period in which the
Prospectus relating to the Placement Shares is required to be delivered by MLPFS under the
Securities Act with respect to a pending sale of the Placement Shares (including in circumstances
where such requirement may be satisfied pursuant to Rule 172 under the Securities Act), the Company
will comply with all requirements imposed upon it by the Securities Act, as from time to time in
force, and to file on or before their respective due dates all reports and any definitive proxy or
information statements required to be filed by the Company with the Commission pursuant to Sections
13(a), 13(c), 14, 15(d) or any other provision of or under the Exchange Act. If during such period
any event occurs as a result of which the Prospectus as then amended or supplemented would 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 then existing, not misleading, or if during
such period it is necessary to amend or supplement the Registration Statement or the Prospectus to
comply with the Securities Act, the Company will promptly notify MLPFS to suspend the offering of
Placement Shares during such period and the Company will promptly amend or supplement, or file a
free writing prospectus applicable to, the
Registration Statement or the Prospectus (at the expense of the Company) so as to correct such
statement or omission or effect such compliance.
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(d) Listing of Placement Shares. During any period in which the Prospectus relating
to the Placement Shares is required to be delivered by MLPFS under the Securities Act with respect
to a pending sale of the Placement Shares (including in circumstances where such requirement may be
satisfied pursuant to Rule 172 under the Securities Act), the Company will use its commercially
reasonable efforts to cause the Placement Shares to be listed on the Exchange and will cooperate
with MLPFS to qualify the Placement Shares for sale under the securities laws of such jurisdictions
in the United States as MLPFS reasonably designates and to continue such qualifications in effect
so long as required for the distribution of the Placement Shares; provided, however, that the
Company shall not be required in connection therewith to qualify as a foreign entity or dealer in
securities or file a general consent to service of process in any jurisdiction.
(e) Filings with the Exchange. The Company will timely file with the Exchange all
documents and notices required by the Exchange of companies that have or will issue securities that
are traded on the Exchange.
(f) Delivery of Registration Statement and Prospectus. The Company will furnish to
MLPFS and its counsel (at the expense of the Company) copies of the Registration Statement, the
Prospectus (including all documents incorporated by reference therein) and all amendments and
supplements to the Registration Statement or the Prospectus that are filed with the Commission
during any period in which the Prospectus relating to the Placement Shares is required to be
delivered under the Securities 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 reasonably
practicable and in such quantities as MLPFS may from time to time reasonably request and, at
MLPFS’s request, will also furnish copies of the Prospectus to each exchange or market on which
sales of the Placement Shares may be made, provided however, that the Company shall not be required
to furnish any document (other than the Prospectus) to MLPFS to the extent such document is
available on XXXXX. The copies of the Registration Statement and the Prospectus and any
supplements or amendments thereto furnished to MLPFS will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(g) Earnings Statement. The Company will make generally available to its security
holders as soon as reasonably practicable, but in any event not later than 15 months after the end
of the Company’s current fiscal quarter, an earnings statement covering a 12-month period that
satisfies the provisions of Section 11(a) and Rule 158 of the Securities Act. “Earnings statement”
and “make generally available” will have the meanings contained in Rule 158 under the Securities
Act.
(h) Expenses. The Company, whether or not the transactions contemplated hereunder
are consummated or this Agreement is terminated, in accordance with the provisions of Section 11
hereunder, will pay all expenses incident to the performance of its obligations hereunder,
including, but not limited to, expenses relating to (i) the preparation, printing and filing of the
Registration Statement and each amendment and supplement thereto, of the Prospectus and of
- 16 -
each amendment and supplement thereto, (ii) the preparation, issuance and delivery of the
Placement Shares, (iii) the qualification of the Placement Shares under securities laws in
accordance with the provisions of Section 7(d) of this Agreement, including filing fees,
(iv) the printing and delivery to MLPFS of copies of the Prospectus and any amendments or
supplements thereto, and of this Agreement, (v) the fees and expenses incurred in connection with
the listing or qualification of the Placement Shares for trading on the Exchange, and (vi) filing
fees and expenses, if any, of the Commission and the FINRA Corporate Financing Department.
(i) Use of Proceeds. The Company will apply the net proceeds from the sale of the
Shares to be sold by it hereunder in accordance in all material respects with the statements under
the caption “Use of Proceeds” in the Prospectus.
(j) Other Sales. During the pendency of any Placement Notice given hereunder, the
Company shall provide MLPFS notice as promptly as reasonably possible before it offers to sell,
contracts to sell, sells, grants any option to sell or otherwise disposes of any Common Shares
(other than Placement Shares offered pursuant to the provisions of this Agreement) or securities
convertible into or exchangeable for Common Shares, warrants or any rights to purchase or acquire
Common Shares; provided, that such notice shall not be required in connection with the (i)
issuance, grant or sale of Common Shares, options to purchase Common Shares or Common Shares upon
the exercise of options or other equity awards pursuant to the any stock option, stock bonus or
other stock plan or arrangement then in effect or which the Company may from time to time adopt
provided the implementation of such is disclosed to MLPFS in advance, (ii) the issuance of
securities in connection with an acquisition, merger or sale or purchase of assets described in the
Prospectus, (iii) any Common Shares issuable upon the exchange, conversion, exercise or redemption
of or with respect to securities of the Company, the Partnerships or any Subsidiaries or rights now
or hereafter in effect or outstanding; or (iv) the issuance or sale of Common Shares pursuant to
any dividend reinvestment plan or direct stock purchase plan that the Company may adopt from time
to time provided the implementation of such is disclosed to MLPFS in advance. Notwithstanding the
foregoing in this Section 7(j), during the pendency of any Placement Notice hereunder, the Company
shall not be permitted to (x) sell any Common Shares pursuant to the CF&Co Sales Agreement, and (y)
issue any “Placement Notices” under the CF&Co Sales Agreement, as such term is defined therein.
(k) Change of Circumstances. The Company will, at any time during a fiscal quarter
in which the Company tenders a Placement Notice or sells Placement Shares, advise MLPFS as promptly
as reasonably possible prior to the delivery of such Placement Notice, of any information or fact
that would alter or affect in any material respect any opinion, certificate, letter or other
document provided to MLPFS pursuant to this Agreement.
(l) Due Diligence Cooperation. The Company will cooperate with any reasonable due
diligence review conducted by MLPFS or its agents in connection with the transactions contemplated
hereby, including, without limitation, providing information and making available documents and
senior officers, upon reasonable notice during regular business hours and at the Company’s
principal offices, as MLPFS may reasonably request.
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(m) Required Filings Relating to Placement of Placement Shares. The Company agrees
that on such dates as the Securities Act shall require, the Company will (i) file a
prospectus supplement with the Commission under the applicable paragraph of Rule 424(b) under
the Securities Act, which prospectus supplement will set forth, within the relevant period, the
amount of Placement Shares to be sold through MLPFS, the Net Proceeds to the Company and the
compensation payable by the Company to MLPFS with respect to such Placement Shares, and (ii)
deliver such number of copies of each such prospectus supplement to each exchange or market on
which such sales were effected as may be required by the rules or regulations of such exchange or
market.
(n) Representation Dates; Certificate. On or prior to the date that the first Shares
are sold pursuant to the terms of this Agreement and each time the Company (i) files the Prospectus
relating to the Placement Shares or amends or supplements the Registration Statement or the
Prospectus relating to the Placement Shares (other than a prospectus supplement filed in accordance
with Section 7(m) of this Agreement) by means of a post-effective amendment, sticker, or
supplement but not by means of incorporation of documents by reference to the Registration
Statement or the Prospectus relating to the Placement Shares; (ii) files an annual report on Form
10-K under the Exchange Act; (iii) files its quarterly reports on Form 10-Q under the Exchange Act;
or (iv) files a report on Form 8-K containing amended financial information (other than an earnings
release, to “furnish” information pursuant to Items 2.02 or 7.01 of Form 8-K or to provide
disclosure pursuant to Item 8.01 of Form 8-K relating to the reclassifications of certain
properties as discontinued operations in accordance with Statement of Financial Accounting
Standards No. 144) under the Exchange Act (each date of filing of one or more of the documents
referred to in clauses (i) through (iv) shall be a “Representation Date”); the Company
shall furnish MLPFS with a certificate, in the form attached hereto as Exhibit 7(n) within
three (3) Trading Days of any Representation Date if requested by MLPFS. The requirement to
provide a certificate under this Section 7(n) is hereby waived for any Representation Date
occurring at a time at which no Placement Notice is pending, which waiver shall continue until the
earlier to occur of the date the Company delivers a Placement Notice hereunder (which for such
calendar quarter shall be considered a Representation Date) and the next occurring Representation
Date; provided, however, that such waiver shall not apply for any Representation Date on which the
Company files its annual report on Form 10-K. Notwithstanding the foregoing, if the Company
subsequently decides to sell Placement Shares following a Representation Date when the Company
relied on such waiver and did not provide MLPFS with a certificate under this Section 7(n),
then before the Company delivers the Placement Notice or MLPFS sells any Placement Shares, the
Company shall provide MLPFS with a certificate, in the form attached hereto as Exhibit
7(n), dated the date of the Placement Notice.
(o) Legal Opinion. On or prior to the date that the first Shares are sold pursuant
to the terms of this Agreement and within five (5) Trading Days of each Representation Date with
respect to which the Company is obligated to deliver a certificate in the form attached hereto as
Exhibit 7(n) for which no waiver is applicable, the Company shall cause to be furnished to
MLPFS a written opinion of each of Xxxx Xxxxxxxx (“Company Counsel”) and Xxxxxxx LLP,
special Maryland counsel for the Company (“Special Maryland Counsel”), or other counsel
satisfactory to MLPFS, in form and substance satisfactory to MLPFS and its counsel, dated the date
that the opinions are required to be delivered, substantially similar to the form attached hereto
as Exhibit 7(o)(1)(a) and Exhibit 7(o)(1)(b), respectively, modified, as necessary,
to relate to the Registration Statement and the Prospectus as then amended or supplemented;
provided,
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however, that in lieu of such opinions for subsequent Representation Dates, counsel may
furnish MLPFS with a letter (a “Reliance Letter”) to the effect that MLPFS may rely on a
prior opinion delivered under this Section 7(o) to the same extent as if it were dated the
date of such letter (except that statements in such prior opinion shall be deemed to relate to the
Registration Statement and the Prospectus as amended or supplemented at such Representation Date).
(p) Comfort Letter. On or prior to the date that the first Shares are sold pursuant
to the terms of this Agreement and within five (5) Trading Days of each Representation Date with
respect to which the Company is obligated to deliver a certificate in the form attached hereto as
Exhibit 7(n) for which no waiver is applicable, the Company shall cause its independent
accountants (and any other independent accountants whose report is included in the Registration
Statement or the Prospectus) to furnish MLPFS letters (the “Comfort Letters”), dated the
date of the Comfort Letter is delivered, in form and substance satisfactory to MLPFS, (i)
confirming that they are an independent registered public accounting firm within the meaning of the
Securities Act, the Exchange Act and the PCAOB, (ii) stating, as of such date, the conclusions and
findings of such firm with respect to the financial information and other matters ordinarily
covered by accountants’ “comfort letters” to underwriters in connection with registered public
offerings (the first such letter, the “Initial Comfort Letter”) and (iii) updating the
Initial Comfort Letter with any information that would have been included in the Initial Comfort
Letter had it been given on such date and modified as necessary to relate to the Registration
Statement and the Prospectus, as amended and supplemented to the date of such letter.
(q) Market Activities. The Company will not, directly or indirectly, (i) take any
action designed to cause or result in, or that constitutes or might reasonably be expected to
constitute, the stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares or (ii) sell, bid for, or purchase the Shares to be
issued and sold pursuant to this Agreement, or pay anyone any compensation for soliciting purchases
of the Shares to be issued and sold pursuant to this Agreement other than MLPFS; provided, however,
that the Company may bid for and purchase its Common Shares in accordance with Rule 10b-18 under
the Exchange Act.
(r) REIT Treatment. The Company currently intends to continue to elect to qualify as
a real estate investment trust under the Code and will use all commercially reasonable efforts to
continue to meet the requirements to so qualify for subsequent tax years that include any portion
of the term of this Agreement.
(s) Investment Company Act. The Company will conduct its affairs in such a manner so
as to reasonably ensure that neither it nor its subsidiaries will be or become, at any time prior
to the termination of this Agreement, an “investment company,” as such term is defined in the
Investment Company Act, assuming no change in the Commission’s current interpretation as to
entities that are not considered an investment company.
(t) Securities Act and Exchange Act. The Company will use its best efforts to comply
with all requirements imposed upon it by the Securities Act and the Exchange Act as from time to
time in force, so far as necessary to permit the continuance of sales of, or dealings in, the
Placement Shares as contemplated by the provisions hereof and the Prospectus.
- 19 -
(u) No Offer to Sell. Other than a free writing prospectus (as defined in Rule 405
under the Securities Act) approved in advance by the Company and MLPFS in its capacity as principal
or agent hereunder, neither MLPFS nor the Company (including its agents and representatives, other
than MLPFS in its capacity as such) will, directly or indirectly, make, use, prepare, authorize,
approve or refer to any free writing prospectus relating to the Shares to be sold by MLPFS as
principal or agent hereunder.
8. Conditions to MLPFS’s Obligations. The obligations of MLPFS hereunder with
respect to a Placement will be subject to the continuing accuracy and completeness of the
representations and warranties made by the Company herein, to the due performance by the Company of
obligations hereunder, to the completion by MLPFS of a due diligence review satisfactory to MLPFS
in its reasonable judgment, and to the continuing satisfaction (or waiver by MLPFS in its sole
discretion) of the following additional conditions:
(a) Registration Statement Effective. The Registration Statement shall be effective
and shall be available for (i) all sales of Placement Shares issued pursuant to all prior Placement
Notices and (ii) the sale of all Placement Shares contemplated to be issued by any Placement
Notice.
(b) No Material Notices. None of the following events shall have occurred and be
continuing: (i) receipt by the Company or any of its subsidiaries of any request for additional
information from the Commission or any other federal or state governmental authority during the
period of effectiveness of the Registration Statement, the response to which would require any
post-effective amendments or supplements to the Registration Statement or the Prospectus; (ii) the
issuance by the Commission or any other federal or state governmental authority of any stop order
suspending the effectiveness of the Registration Statement or the initiation of any proceedings for
that purpose; (iii) receipt by the Company of any notification with respect to the suspension of
the qualification or exemption from qualification of any of the Placement Shares for sale in any
jurisdiction or the initiation or threatening of any proceeding for such purpose; (iv) the
occurrence of any event that makes any material statement made in the Registration Statement or the
Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in
any material respect or that requires the making of any changes in the Registration Statement,
related Prospectus or such documents so that, in the case of the Registration Statement, it will
not contain any materially untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not misleading and, that
in the case of the Prospectus, it will not contain any materially untrue statement of a material
fact or omit to state any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were made, not misleading.
(c) No Misstatement or Material Omission. MLPFS shall not have advised the Company
that the Registration Statement or the Prospectus, or any amendment or supplement thereto, contains
an untrue statement of fact that in MLPFS’s reasonable opinion is material, or omits to state a
fact that in MLPFS’s opinion is material and is required to be stated therein or is necessary to
make the statements therein not misleading.
- 20 -
(d) Material Changes. Except as disclosed in the Prospectus, there shall not have
been any material adverse change, on a consolidated basis, in the authorized equity or long-term
debt of the Company or any Material Adverse Effect, or any development that could reasonably be
expected to cause a Material Adverse Effect, or any downgrading in or withdrawal of the rating
assigned to any of the Company’s securities (other than asset backed securities) by any rating
organization or a public announcement by any rating organization that it has under surveillance or
review its rating of any of the Company’s securities (other than asset backed securities), the
effect of which, in the case of any such action by a rating organization described above, in the
reasonable judgment of MLPFS (without relieving the Company of any obligation or liability it may
otherwise have), is so material as to make it impracticable or inadvisable to proceed with the
offering of the Placement Shares on the terms and in the manner contemplated in the Prospectus.
(e) Legal Opinion. MLPFS shall have received the opinions of Company Counsel and
Special Maryland Counsel required to be delivered pursuant Section 7(o) on or before the
date on which such delivery of such opinion is required pursuant to Section 7(o).
(f) Comfort Letter. MLPFS shall have received the Comfort Letter required to be
delivered pursuant Section 7(p) on or before the date on which such delivery of such
Comfort Letter is required pursuant to Section 7(p).
(g) Representation Certificate. MLPFS shall have received the certificate required
to be delivered pursuant to Section 7(n) on or before the date on which delivery of such
certificate is required pursuant to Section 7(n).
(h) No Suspension. Trading in the Common Shares shall not have been suspended on the
Exchange.
(i) Other Materials. On each date on which the Company is required to deliver a
certificate pursuant to Section 7(n), the Company shall have furnished to MLPFS such
appropriate further information, certificates and documents as MLPFS may have reasonably requested.
All such opinions, certificates, letters and other documents shall have been in compliance with the
provisions hereof. The Company shall have furnished MLPFS with such conformed copies of such
opinions, certificates, letters and other documents as MLPFS shall have reasonably requested.
(j) Securities Act Filings Made. All filings with the Commission required by Rule
424 under the Securities Act to have been filed prior to the issuance of any Placement Notice
hereunder shall have been made within the applicable time period prescribed for such filing by Rule
424.
(k) Approval for Listing. The Placement Shares shall either have been (i) approved
for listing on the Exchange, subject only to notice of issuance, or (ii) the Company shall have
filed an application for listing of the Placement Shares on the Exchange at, or prior to, the
issuance of any Placement Notice.
(l) No Termination Event. There shall not have occurred any event that would permit
MLPFS to terminate this Agreement pursuant to Section 11(a).
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9. Indemnification and Contribution.
(a) Company Indemnification. The Company agrees to indemnify and hold harmless
MLPFS, the directors, officers, partners, employees and agents of MLPFS and each person, if any,
who (i) controls MLPFS within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, or (ii) is controlled by or is under common control with MLPFS (a “MLPFS
Affiliate”) from and against any and all losses, claims, liabilities, expenses and damages
(including, but not limited to, any and all reasonable investigative expenses by any governmental
agency or body, legal and other expenses incurred in connection with, and any and all amounts paid
in settlement (in accordance with Section 9(c)) 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 MLPFS, or any
such person, may become subject under the Securities 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, directly or indirectly, on (x) any
untrue statement or alleged untrue statement of a material fact contained in the Registration
Statement or the Prospectus or any amendment or supplement to the Registration Statement or the
Prospectus or in any free writing prospectus or in any application or other document executed by or
on behalf of the Company or based on written information furnished by or on behalf of the Company
filed in any jurisdiction in order to qualify the Shares under the securities laws thereof or filed
with the Commission, or (y) the omission or alleged omission to state in any such Registration
Statement or amendment or supplement thereto a material fact required to be stated in it or
necessary to make the statements in it not misleading, or (z) the omission or alleged omission to
state in any such Prospectus or amendment or supplement thereto a material fact required to be
stated in it or necessary to make the statements in it, in the light of the circumstances under
which they were made, not misleading; provided, however, that this indemnity agreement shall not
apply to the extent that such loss, claim, liability, expense or damage arises from the sale of
Shares under this Agreement and is caused directly or indirectly by an untrue statement or omission
made in reliance upon and in conformity with written information relating to MLPFS and furnished to
the Company by MLPFS expressly for inclusion in any document as described in clause (x) of this
Section 9(a). This indemnity agreement will be in addition to any liability that the
Company might otherwise have.
(b) MLPFS Indemnification. MLPFS agrees to indemnify and hold harmless the Company,
its trustees, each officer of the Company that signed the Registration Statement, the and each
person, if any, who (i) controls the Company or the within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act or (ii) is controlled by or is under common
control with the Company or the (a “Company Affiliate”) against any and all loss,
liability, claim, damage and expense described in the indemnity contained in Section 9(a),
as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements
or omissions, made in the Registration Statement (or any amendments thereto) or the Prospectus (or
any amendment or supplement thereto) in reliance upon and in conformity with written information
relating to MLPFS and furnished to the Company by MLPFS expressly for inclusion in any document as
described in clause (x) of Section 9(a). This indemnity agreement will be in addition to
any liability that MLPFS might otherwise have.
- 22 -
(c) Procedure. Any party that proposes to assert the right to be indemnified under
this Section 9 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 9, 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 the indemnifying party from (i) any liability that it might have to any indemnified
party otherwise than under this Section 9 and (ii) any liability that it may have to any
indemnified party under the foregoing provision of this Section 9 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
reasonably 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 one 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 are incurred. An indemnifying party will not, in any event, be
liable for any settlement of any action or claim effected without its written consent. 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 9 (whether or not any
indemnified party is a party thereto), unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising or that may arise out of
such claim, action or proceeding.
(d) Contribution. In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in the foregoing paragraphs of this
Section 9 is applicable in accordance with its terms but for any reason is held to be
unavailable
- 23 -
from the Company or MLPFS, the Company and MLPFS 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 Company from persons
other than MLPFS, if any), to which the Company and MLPFS may be subject in such proportion as
shall be appropriate to reflect the relative benefits received by the Company, on the one hand, and
MLPFS, on the other. The relative benefits received by the Company on the one hand and MLPFS on the
other hand shall be deemed to be in the same proportion as the total net proceeds from the sale of
the Placement Shares (before deducting expenses) received by the Company bear to the total
compensation received by MLPFS from the sale of Placement Shares on behalf of the Company. 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
Company, on the one hand, and MLPFS, on the other, with respect to the statements or omission that
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, among other things, 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 Company, on the one hand, or MLPFS, on the other, the intent of the
parties and their relative knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and MLPFS agree that it would not be just and equitable if
contributions pursuant to this Section 9(d) were to be determined by pro rata allocation or
by any other method of allocation that does not take into account the equitable considerations
referred to herein. 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 9(d) shall be deemed to include, for the purpose of this Section 9(d), any
legal or other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim to the extent consistent with Section
9(c) hereof. Notwithstanding the foregoing provisions of this Section 9(d), MLPFS
shall not be required to contribute any amount in excess of the commissions received by it under
this Agreement and no person found guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) will be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section 9(d), any person
who controls a party to this Agreement within the meaning of the Securities Act, and any officers,
directors, partners, employees or agents of MLPFS, will have the same rights to contribution as
that party, and each trustee of the Company and each officer of the Company who signed the
Registration Statement will have the same rights to contribution as the Company, 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 9(d), will notify any such party or parties from whom
contribution may be sought, but the omission to so notify will not relieve that party or parties
from whom contribution may be sought from any other obligation it or they may have under this
Section 9(d) except to the extent that the failure to so notify such other party materially
prejudiced the substantive rights or defenses of the party from whom contribution is sought. Except
for a settlement entered into pursuant to the last sentence of Section 9(c) hereof, no
party will be liable for contribution with respect to any action or claim settled without its
written consent if such consent is required pursuant to Section 9(c) hereof.
- 24 -
10. Representations and Agreements to Survive Delivery. The indemnity and
contribution agreements contained in Section 9 of this Agreement and all representations
and warranties of the Company herein or in certificates delivered pursuant hereto shall survive, as
of their respective dates, regardless of (i) any investigation made by or on behalf of MLPFS, any
controlling persons, or the Company (or any of their respective officers, trustees, directors or
controlling persons), (ii) delivery and acceptance of the Placement Shares and payment therefor or
(iii) any termination of this Agreement.
11. Termination.
(a) MLPFS shall have the right by giving notice as hereinafter specified at any time to
terminate this Agreement if (i) any Material Adverse Effect, or any development that could
reasonably be expected to cause a Material Adverse Effect has occurred, that, in the reasonable
judgment of MLPFS, may materially impair the ability of MLPFS to sell the Placement Shares
hereunder; (ii) the Company shall have failed, refused or been unable to perform any agreement on
its part to be performed hereunder; provided, however, in the case of any failure of the Company to
deliver (or cause another person to deliver) any certification, opinion, or letter required under
Sections 7(n), 7(o), or 7(p), MLPFS’s right to terminate shall not
arise unless such failure to deliver (or cause to be delivered) continues for more than thirty (30)
days from the date such delivery was required; or (iii) any other material condition of MLPFS’s
obligations hereunder is not fulfilled; or (iv) any suspension or limitation of trading in the
Placement Shares or in securities generally on the Exchange shall have occurred. Any such
termination shall be without liability of any party to any other party except that the provisions
of Section 7(h) (Expenses), Section 9 (Indemnification), Section 10
(Survival of Representations), Section 16 (Applicable Law; Consent to Jurisdiction) and
Section 17 (Waiver of Jury Trial) hereof shall remain in full force and effect
notwithstanding such termination.
(b) The Company shall have the right, by giving ten (10) days notice as hereinafter specified
to terminate this Agreement in its sole discretion at any time after the date of this Agreement.
Any such termination shall be without liability of any party to any other party except that the
provisions of Section 7(h), Section 9, Section 10, Section 16 and
Section 17 hereof shall remain in full force and effect notwithstanding such termination.
(c) MLPFS shall have the right, by giving ten (10) days notice as hereinafter specified to
terminate this Agreement in its sole discretion at any time after the date of this Agreement. Any
such termination shall be without liability of any party to any other party except that the
provisions of Section 7(h), Section 9, Section 10, Section 16 and
Section 17 hereof shall remain in full force and effect notwithstanding such termination.
(d) Unless earlier terminated pursuant to this Section 11, this Agreement shall
automatically terminate upon the issuance and sale of all of the Placement Shares through MLPFS on
the terms and subject to the conditions set forth herein; provided that the provisions of
Section 7(h), Section 9, Section 10, Section 16 and Section
17 hereof shall remain in full force and effect notwithstanding such termination.
(e) This Agreement shall remain in full force and effect unless terminated pursuant to
Sections 11(a), (b), (c), or (d) above or otherwise by mutual
agreement of the parties; provided, however, that any such termination by mutual agreement shall in
all cases be deemed to provide
that Section 7(h), Section 9, Section 10, Section 16 and
Section 17 shall remain in full force and effect.
- 25 -
(f) Any termination of this Agreement shall be effective on the date specified in such notice
of termination; provided, however, that such termination shall not be effective until the close of
business on the date of receipt of such notice by MLPFS or the Company, as the case may be. If such
termination shall occur prior to the Settlement Date for any sale of Placement Shares, such
Placement Shares shall settle in accordance with the provisions of this Agreement.
12. Notices. All notices or other communications required or permitted to be given
by any party to any other party pursuant to the terms of this Agreement shall be in writing by,
unless otherwise specified in this Agreement, and if sent to MLPFS, shall be delivered to MLPFS at
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, 0 Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, fax no. (000) 000-0000, Attention: Xxx Xxxxxxx, with copies to B. Xxxxxxxxxxx Xxxxxx, at the
same address, and DLA Piper LLP (US), 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000, fax no.
(000) 000-0000, Attention: Xxxx X. Xxxxxxx; or if sent to the Company, shall be delivered to
Lexington Realty Trust, Xxx Xxxx Xxxxx, Xxxxx 0000, Xxx Xxxx, XX 00000, Attention Xxxxxx X.
Xxxxxxxxx, fax no. (000) 000-0000 with a copy to Xxxx Xxxxxxxx, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX
00000 Attention: Xxxx Xxxxxxxxxxx, fax no. (000) 000-0000. Each party to this Agreement may
change such address for notices by sending to the parties to this Agreement written notice of a new
address for such purpose. Each such notice or other communication shall be deemed given (i) when
delivered personally or by verifiable facsimile transmission (with an original to follow) on or
before 4:30 p.m., New York City time, on a Business Day or, if such day is not a Business Day, on
the next succeeding Business Day, (ii) on the next Business Day after timely delivery to a
nationally-recognized overnight courier and (iii) on the Business Day actually received if
deposited in the U.S. mail (certified or registered mail, return receipt requested, postage
prepaid). For purposes of this Agreement, “Business Day” shall mean any day on which the
Exchange and commercial banks in the City of New York are open for business.
13. Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the Company and MLPFS and their respective successors and the affiliates, controlling
persons, officers and directors referred to in Section 9 hereof. References to any of the
parties contained in this Agreement shall be deemed to include the successors and permitted assigns
of such party. Nothing in this Agreement, express or implied, is intended to confer upon any party
other than the parties hereto or their respective successors and permitted assigns any rights,
remedies, obligations or liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement. Neither party may assign its rights or obligations under this Agreement
without the prior written consent of the other party; provided, however, that MLPFS may assign its
rights and obligations hereunder to an affiliate of MLPFS without obtaining the Company’s consent.
14. Adjustments for Stock Splits. The parties acknowledge and agree that all
stock-related numbers contained in this Agreement shall be adjusted to take into account any stock
split, stock dividend or similar event effected with respect to the Shares.
15. Entire Agreement; Amendment; Severability. This Agreement (including all
schedules and exhibits attached hereto and Placement Notices issued pursuant hereto) constitutes
- 26 -
the entire agreement and supersedes all other prior and contemporaneous agreements and
undertakings, both written and oral, among the parties hereto with regard to the subject matter
hereof. Neither this Agreement nor any term hereof may be amended except pursuant to a written
instrument executed by the Company and MLPFS. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held invalid, illegal or
unenforceable as written by a court of competent jurisdiction, then such provision shall be given
full force and effect to the fullest possible extent that it is valid, legal and enforceable, and
the remainder of the terms and provisions herein shall be construed as if such invalid, illegal or
unenforceable term or provision was not contained herein, but only to the extent that giving effect
to such provision and the remainder of the terms and provisions hereof shall be in accordance with
the intent of the parties as reflected in this Agreement.
16. Applicable Law; Consent to Jurisdiction. This Agreement shall be governed by,
and construed in accordance with, the internal laws of the State of New York without regard to the
principles of conflicts of laws. Each party hereby irrevocably submits to the non-exclusive
jurisdiction of the state and federal courts sitting in the City of New York, borough of Manhattan,
for the adjudication of any dispute hereunder or in connection with any transaction contemplated
hereby, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such court, that such suit,
action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or
proceeding is improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by mailing a copy thereof
(certified or registered mail, return receipt requested) to such party at the address in effect for
notices to it under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. Nothing contained herein shall be deemed to
limit in any way any right to serve process in any manner permitted by law.
17. Waiver of Jury Trial. The Company and MLPFS each hereby irrevocably waives any
right it may have to a trial by jury in respect of any claim based upon or arising out of this
Agreement or any transaction contemplated hereby.
18. Absence of Fiduciary Relationship. The Company acknowledges and agrees that:
(a) MLPFS has been retained solely to act as sales agent in connection with the sale of the
Shares and that no fiduciary, advisory or agency relationship between the Company and MLPFS has
been created in respect of any of the transactions contemplated by this Agreement, irrespective of
whether MLPFS has advised or is advising the Company on other matters;
(b) the Company is capable of evaluating and understanding and understands and accepts the
terms, risks and conditions of the transactions contemplated by this Agreement;
(c) the Company has been advised that MLPFS and its affiliates are engaged in a broad range
of transactions which may involve interests that differ from those of the Company and that MLPFS
has no obligation to disclose such interests and transactions to the Company by virtue of any
fiduciary, advisory or agency relationship; and
(d) the Company waives, to the fullest extent permitted by law, any claims it may have
against MLPFS, for breach of fiduciary duty or alleged breach of fiduciary duty and agrees that
- 27 -
MLPFS shall have no liability (whether direct or indirect) to the Company in respect of such a
fiduciary claim or to any person asserting a fiduciary duty claim on behalf of or in right of the
Company, including stockholders, partners, employees or creditors of the Company.
19. Counterparts. This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute one and the same
instrument. Delivery of an executed Agreement by one party to the other may be made by facsimile
transmission.
20. Definitions. As used in this Agreement, the following terms have the respective
meanings set forth below:
(a) “Applicable Time” means the time of each sale of any Shares or any securities
pursuant to this Agreement.
(b) “GAAP” means United States generally accepted accounting principles.
(c) “Organizational Documents” means (a) in the case of a corporation, its charter
and by-laws; (b) in the case of a limited or general partnership, its partnership certificate,
certificate of formation or similar organizational document and its partnership agreement; (c) in
the case of a limited liability company, its articles of organization, certificate of formation or
similar organizational documents and its operating agreement, limited liability company agreement,
membership agreement or other similar agreement; (d) in the case of a trust, its certificate of
trust, certificate of formation or similar organizational document and its trust agreement or other
similar agreement; and (e) in the case of any other entity, the organizational and governing
documents of such entity.
THE AMENDED AND RESTATED DECLARATION OF TRUST ESTABLISHING THE COMPANY, DATED JULY 1, 1994, A
COPY OF WHICH, TOGETHER WITH ALL AMENDMENTS AND SUPPLEMENTS THERETO (THE “DECLARATION”), IS DULY
FILED IN THE OFFICE OF THE STATE DEPARTMENT OF ASSESSMENTS AND TAXATION OF MARYLAND, PROVIDES THAT
THE NAME “LEXINGTON REALTY TRUST” REFERS TO THE TRUSTEES UNDER THE DECLARATION, AS SO AMENDED AND
SUPPLEMENTED, COLLECTIVELY AS TRUSTEES, BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE,
OFFICER, SHAREHOLDER, EMPLOYEE OR AGENT OF THE COMPANY SHALL BE HELD TO ANY PERSONAL LIABILITY,
JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, THE COMPANY. ALL PERSONS DEALING
WITH THE COMPANY, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF THE COMPANY FOR THE PAYMENT OF ANY
SUM OR THE PERFORMANCE OF ANY OBLIGATION.
[Remainder of Page Intentionally Blank]
- 28 -
If the foregoing correctly sets forth the understanding among the Company and MLPFS, please
so indicate in the space provided below for that purpose, whereupon this letter shall constitute a
binding agreement between the Company and MLPFS.
| Very truly yours, | ||||||
| LEXINGTON REALTY TRUST | ||||||
| By: Name: |
/s/ Xxxxxx X. Xxxxxxxxx
|
|||||
| Title: | Executive Vice President | |||||
| THE LEXINGTON MASTER LIMITED PARTNERSHIP |
||||||
| By: LEX GP-1 TRUST, general partner | ||||||
| By: Name: |
/s/ Xxxxxx X. Xxxxxxxxx
|
|||||
| Title: | Senior Vice President | |||||
| LEPERCQ CORPORATE INCOME FUND L.P. | ||||||
| By: Name: |
/s/ Xxxxxx X. Xxxxxxxxx
|
|||||
| Title: | Senior Vice President | |||||
| LEPERCQ CORPORATE INCOME FUND II L.P. | ||||||
| By: LEX GP-1 TRUST, general partner | ||||||
| By: Name: |
/s/ Xxxxxx X. Xxxxxxxxx
|
|||||
| Title: | Senior Vice President | |||||
| NET 3 ACQUISITION L.P. | ||||||
| By: LEX GP-1 TRUST, general partner | ||||||
| By: Name: |
/s/ Xxxxxx X. Xxxxxxxxx
|
|||||
| Title: | Senior Vice President | |||||
| ACCEPTED as of the date | ||||||
| first-above written: | ||||||
| XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED |
||||||
| By: Name: |
/s/ B. Xxxxxxxxxxx Xxxxxx
|
|||||
| Title: | Director | |||||
SCHEDULE 1
FORM OF PLACEMENT NOTICE
From:
|
[ ] | |
Cc:
|
[ ] | |
To:
|
[ ] | |
Subject:
|
Controlled Equity Offering—Placement Notice |
Gentlemen:
Pursuant to the terms and subject to the conditions contained in the Controlled Equity
OfferingSM Sales Agreement among LEXINGTON REALTY TRUST (the “Company”); THE
LEXINGTON MASTER LIMITED PARTNERSHIP, LEPERCQ CORPORATE INCOME FUND L.P., LEPERCQ CORPORATE INCOME
FUND II L.P. and NET 3 ACQUISITION L.P., each a Delaware limited partnership; and XXXXXXX LYNCH,
PIERCE, XXXXXX & XXXXX INCORPORATED
(“MLPFS”), dated December 12, 2008 (the
“Agreement”), I hereby request on behalf of the Company that MLPFS sell up to [ ] shares of
the Company’s common shares of beneficial interest, par value $0.01 per share, at a minimum market
price of $ per share during [insert applicable period].
SCHEDULE 2
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
Xxxxxxxx X’Xxxxx (Xxxxx_Xxxxxx@xx.xxx)
X. Xxxxxx Eglin
Xxxxxxx Xxxxxxx
Xxxxxx X. Xxxxxxxxx
Xxxxxxx Xxxxxxx
Xxxxxx X. Xxxxxxxxx
SCHEDULE 3
Compensation
MLPFS
shall be paid compensation not to exceed two and three-quarters percent (2.75%) of the gross
proceeds from the sales of Shares pursuant to the terms of this Agreement.
Exhibit 7(n)
OFFICER CERTIFICATE
The undersigned, the duly qualified and elected , of LEXINGTON REALTY TRUST
(“Company”), a Maryland real estate investment trust, does hereby certify in such capacity
and on behalf of the Company, pursuant to Section 7(n) of the Sales Agreement, dated
December 12, 2008 (the “Sales Agreement”), among the Company, THE LEXINGTON MASTER LIMITED
PARTNERSHIP, LEPERCQ CORPORATE INCOME FUND L.P., LEPERCQ CORPORATE INCOME FUND II L.P. And NET 3
ACQUISITION L.P., each a Delaware limited partnership (each a “Partnership” and
collectively the ‘Partnerships”), and XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
that to the knowledge of the undersigned:
(i) The representations and warranties of the Company and the Partnerships in Section
6 of the Sales Agreement (A) to the extent such representations and warranties are subject to
qualifications and exceptions contained therein relating to materiality or Material Adverse Effect,
are true and correct on and as of the date hereof with the same force and effect as if expressly
made on and as of the date hereof, except for those representations and warranties that speak
solely as of a specific date and which were true and correct as of such date, and (B) to the extent
such representations and warranties are not subject to any qualifications or exceptions, are true
and correct in all material respects as of the date hereof as if made on and as of the date hereof
with the same force and effect as if expressly made on and as of the date hereof except for those
representations and warranties that speak solely as of a specific date and which were true and
correct as of such date; and
(ii) The Company and the Partnerships have complied with all agreements and satisfied all
conditions to be performed or satisfied on its part pursuant to the Sales Agreement at or prior to
the date hereof.
| By: | ||||
| Name: | ||||
| Title: | ||||
Date:
Exhibit 7(o)(1)(a)
MATTERS TO BE COVERED BY INITIAL OPINION OF PAUL, HASTINGS,
XXXXXXXX & XXXXXX LLP AND WHERE INDICATED SUBSEQUENT PAUL,
HASTINGS, XXXXXXXX & XXXXXX LLP OPINION ALSO
XXXXXXXX & XXXXXX LLP AND WHERE INDICATED SUBSEQUENT PAUL,
HASTINGS, XXXXXXXX & XXXXXX LLP OPINION ALSO
[Omitted from filing.]
Exhibit 7(o)(1)(b)
MATTERS TO BE COVERED BY INITIAL OPINION OF
XXXXXXX LLP
[Omitted from filing.]
