EXHIBIT 1.1
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iSTAR FINANCIAL INC.
(a Maryland corporation)
10,000,000 Shares of Common Stock
PURCHASE AGREEMENT
Dated: November 14, 2002
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iSTAR FINANCIAL INC.
(a Maryland corporation)
10,000,000 Shares of Common Stock
(Par Value $.001 Per Share)
PURCHASE AGREEMENT
November 14, 2002
XXXXXX BROTHERS INC.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
BANC OF AMERICA SECURITIES LLC
BEAR, XXXXXXX & CO. INC.
XXXXXXX, XXXXX & CO.
UBS WARBURG LLC,
as Representatives of the several Underwriters
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
iStar Financial Inc., a Maryland corporation (the "Company"), and SOFI-IV
SMT Holdings, L.L.C., a Delaware limited liability company (the "Selling
Stockholder"), confirm their respective agreements with each of the Underwriters
named in Schedule A hereto (collectively, the "Underwriters", which term shall
also include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom Xxxxxx Brothers Inc. ("Xxxxxx Brothers"), Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated, Banc of America Securities LLC, Bear,
Xxxxxxx & Co. Inc., Xxxxxxx, Xxxxx & Co. and UBS Warburg LLC are acting as
representatives (in such capacity, the "Representatives"), with respect to (i)
the sale by the Company and the Selling Stockholder, acting severally and not
jointly, and the purchase by the Underwriters, acting severally and not jointly,
of the respective numbers of shares of Common Stock, par value $.001 per share,
of the Company (the "Common Stock") set forth in Schedules A and B hereto and
(ii) the grant by the Selling Stockholder to the Underwriters, acting severally
and not jointly, of the option described in Section 2(b) hereof to purchase all
or any part of 1,500,000 additional shares of Common Stock to cover
over-allotments, if any. The aforesaid 10,000,000 shares of Common Stock (the
"Initial Securities") to be purchased by the Underwriters and all or any part of
the 1,500,000 shares of Common Stock subject to the option described in Section
2(b) hereof (the "Option Securities") are hereinafter called, collectively, the
"Securities".
The Company and the Selling Stockholder understand that the Underwriters
propose to make a public offering of the Securities as soon as the
Representatives deem advisable after this Agreement has been executed and
delivered.
The Company, the Selling Shareholder and the Underwriters agree that up to
85,660 shares of the Securities to be purchased by the Underwriters (the
"Reserved Securities") shall be reserved for sale by the Underwriters to certain
officers and directors of the Company, as part of the distribution of the
Securities by the Underwriters, subject to the terms of this Agreement, the
applicable rules, regulations and interpretations of the National Association of
Securities Dealers, Inc. (the "NASD") and all other applicable laws, rules and
regulations. To the extent that such Reserved Securities are not orally
confirmed for purchase by such officers and directors by the end of the first
business day after the date of this Agreement, such Reserved Securities may be
offered to the public as part of the public offering contemplated hereby.
The Company has filed with the Securities and Exchange Commission (the
"Commission") two registration statements on Form S-3 (Nos. 333-32946 and
333-83646) covering the registration of the Securities under the Securities Act
of 1933, as amended (the "1933 Act"), including the related prospectuses, which
have become effective. The registration statements (including the exhibits
thereto and schedules thereto, if any) as amended at the time they became
effective, or, if a post-effective amendment has been filed with respect
thereto, as amended by such post-effective amendment at the time of its
effectiveness (including in each case the information (if any) deemed to be part
of such registration statements at the time of effectiveness pursuant to Rule
430A under the 1933 Act), are hereinafter referred to as the "Registration
Statements." The term "Effective Date" shall mean each date that the
Registration Statements and any post-effective amendment or amendments thereto
became or become effective. The term "Base Prospectuses" shall mean each of the
prospectuses referred to in Section 1(a)(i) hereof contained in the Registration
Statements at the Effective Date. "Preliminary Prospectus" means the preliminary
prospectus supplement to the Base Prospectuses used prior to the filing of the
Prospectus; the term "Prospectus" means the prospectus supplement to the Base
Prospectuses first filed with the Commission pursuant to Rule 424(b) under the
Securities Act, together with the Base Prospectuses. Any registration statement
filed pursuant to Rule 462(b) under the 1933 Act is herein referred to as the
"Rule 462(b) Registration Statement," and after such filing the term
"Registration Statements" shall include the Rule 462(b) Registration Statement.
Any reference in this Agreement to either of the Registration Statements,
any Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item 12 of
Form S-3 under the 1933 Act, as of the effective date of such Registration
Statement or the date of such Preliminary Prospectus or the Prospectus, as the
case may be (it being understood that the several specific references in this
Agreement to documents incorporated by reference in the Registration Statements
or the Prospectus are for clarifying purposes only and are not meant to limit
the inclusiveness of any other definition herein). For purposes of this
Agreement, all references to either of the Registration Statements, any
Preliminary Prospectus, or the Prospectus or any amendment or supplement to any
of the foregoing shall be deemed to include the copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval system
("XXXXX"). All references in this
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Agreement to financial statements and schedules and other information which is
"contained," "included" or "stated" in either of the Registration Statements,
any Preliminary Prospectus or the Prospectus (or other references of like
import) shall be deemed to mean and include all such financial statements and
schedules and other information which is incorporated by reference in such
Registration Statement, any Preliminary Prospectus or the Prospectus, as the
case may be.
SECTION 1. Representations and Warranties.
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY. The Company represents
and warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with each Underwriter, as
follows:
(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. The Company meets
the requirements for use of Form S-3 under the 1933 Act and has filed with
the Commission the Registration Statements on such Form, including the Base
Prospectuses, for registration under the 1933 Act of the offering and sale
of the Securities, one or more amendments to either of such Registration
Statements may have been so filed, and the Company may have used a
Preliminary Prospectus. Each of such Registration Statements, as so
amended, has become effective. Although each of the Base Prospectuses may
not include all the information with respect to the Securities and the
offering thereof required by the 1933 Act and the rules and regulations of
the Commission thereunder (the "1933 Act Regulations") to be included in
the Prospectus, such Base Prospectuses include all such information
required by the 1933 Act and the 1933 Act Regulations to be included
therein as of the applicable Effective Date. After the execution of this
Agreement, the Company will file with the Commission pursuant to Rules 415
and 424(b)(2) or (5) a final supplement to the Base Prospectuses included
in such Registration Statements relating to the Securities and the offering
thereof, with such information as is required or permitted by the 1933 Act
and as has been provided to and approved by the Representatives prior to
the date hereof or, to the extent not completed at the date hereof,
containing only such specific additional information and other changes
(beyond that contained in the Base Prospectuses and any Preliminary
Prospectus) as the Company has advised you, prior to the date hereof, will
be included or made therein. The Company may also file a Rule 462(b)
Registration Statement with the Commission for the purpose of registering
certain additional Securities, which registration shall be effective upon
filing with the Commission.
The Commission has not issued any order preventing or suspending the
use of any Preliminary Prospectus. When any Preliminary Prospectus was
filed with the Commission, it (x) complied as to form in all material
respects with the requirements of the 1933 Act and the 1933 Act Regulations
and (y) did not include any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading. When each of the Registration Statements or any amendment
thereto was or is declared effective, it (I) complied as to form or will
comply in all material respects with the requirements of the 1933 Act, the
Securities Exchange Act of 1934, as amended
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(the "1934 Act"), the 1933 Act Regulations and the rules and regulations of
the Commission under the 1934 Act (the "1934 Act Regulations") and (II) did
not or will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make
the statements therein not misleading. When the Prospectus or any amendment
or supplement to the Prospectus is filed with the Commission pursuant to
Rule 424(b) (or, if the Prospectus or such amendment or supplement is not
required to be so filed, when each of the Registration Statements or the
amendment thereto containing the Prospectus or such amendment or supplement
to the Prospectus was or is declared effective) and at the Closing Time
(and, if any Option Securities are purchased, at the Date of Delivery), the
Prospectus, as amended or supplemented at any such time, (A) complied as to
form or will comply in all material respects with the requirements of, the
1933 Act, the 1934 Act, the 1933 Act Regulations and the 1934 Act
Regulations and (B) did not or will not include any untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading. The foregoing provisions of this paragraph do
not apply to statements or omissions made in any Preliminary Prospectus,
either of the Registration Statements or any amendment thereto or the
Prospectus or any amendment or supplement thereto in reliance upon and in
conformity with written information furnished to the Company by any
Underwriter through the Representatives specifically for use therein.
If the Company has elected to rely on Rule 462(b) and the Rule 462(b)
Registration Statement is not effective, (x) the Company will file a Rule
462(b) Registration Statement in compliance with, and that is effective
upon filing pursuant to, Rule 462(b) and (y) the Company has given
irrevocable instructions for transmission of the applicable filing fee in
connection with the filing of the Rule 462(b) Registration Statement, in
compliance with Rule 111 under the 1933 Act, or the Commission has received
payment of such filing fee.
The Company has not distributed and, prior to the later of (x) the
Closing Time (and, if any Option Securities are purchased, the Date of
Delivery) and (y) the completion of the distribution of the Securities,
will not distribute any offering material in connection with the offering
of the Securities pursuant to this Agreement other than the Registration
Statements or any amendment thereto, any Preliminary Prospectus or the
Prospectus or any amendment or supplement thereto.
(ii) NO MATERIAL LIABILITIES. Subsequent to the respective dates
as of which information is given in each of the Registration Statements and
the Prospectus (x) the Company and its subsidiaries, taken as a whole, have
not incurred any material liability or obligation, direct or contingent,
nor entered into any material transaction not in the ordinary course of
business; (y) the Company has not purchased any of its outstanding capital
stock; and (z) there has not been any material change in the capital stock
of the Company, or in the short-term or long-term debt of the Company and
its subsidiaries, taken as a whole, except in each case as described in or
contemplated by the Prospectus.
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(iii) INCORPORATED DOCUMENTS. Each document, if any, filed or to
be filed pursuant to the 1934 Act and incorporated by reference in either
the Preliminary Prospectus or the Prospectus (or any amendment or
supplement thereto) complied or will comply when so filed in all material
respects with the 1934 Act and the 1934 Act Regulations.
(iv) CAPITALIZATION. The Company has an authorized, issued and
outstanding capitalization as set forth in the Prospectus. All of the
issued shares of capital stock of the Company, including the Securities to
be purchased by the Underwriters from the Selling Stockholder, have been
duly authorized and validly issued and are fully paid and non-assessable.
(v) NO REGISTRATION RIGHTS. No holder of securities of the
Company has any right which has not been fully exercised or waived to
require the Company to register the offer or sale of any securities owned
by such holder under the 1933 Act in the offering of the Securities
contemplated by this Agreement.
(vi) NO EQUITY INTERESTS. Except for the shares of capital stock
of each of the subsidiaries owned by the Company and such subsidiaries,
neither the Company nor any such subsidiary owns any shares of stock or any
other equity securities of any corporation or has any equity interest in
any firm, partnership, association or other entity, except in connection
with an investment in its ordinary course of business, or as otherwise
described in or contemplated by the Prospectus.
(vii) MARKET MANIPULATION. Neither the Company nor any of its
affiliates, nor any person acting on behalf of any of them has, directly or
indirectly, (x) taken any action designed to cause or to result in, or that
has constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Securities, or (y) since the filing
of either of the Registration Statements (I) sold, bid for, purchased, or
paid anyone any compensation for soliciting purchases of, the Securities
other than as contemplated by this Agreement or (II) paid or agreed to pay
to any person any compensation for soliciting another to purchase any
shares of Common Stock or any securities convertible into or exchangeable
or exercisable for shares of Common Stock.
(viii) POWER AND AUTHORITY. The Company has been duly incorporated
and is validly existing as a corporation in good standing under the law of
its jurisdiction of incorporation with full power and authority to own,
lease and operate its properties and assets and conduct its business as
described in the Prospectus, is duly qualified to transact business and is
in good standing in each jurisdiction in which its ownership, leasing or
operation of its properties or assets or the conduct of its business
requires such qualification, except where the failure to be so qualified
does not amount to a material liability or disability to the Company and
its subsidiaries, taken as a whole, and has full power and authority to
execute and perform its obligations under this Agreement; each subsidiary
of the Company is a corporation, limited liability company or limited
partnership duly incorporated or organized, as the case may be, validly
existing and in
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good standing under the laws of its jurisdiction of incorporation or
organization and is duly qualified to transact business and is in good
standing in each jurisdiction in which its ownership, leasing or operation
of its properties or assets or the conduct of its business requires such
qualification, except where the failure to be so qualified does not amount
to a material liability or disability to the Company and its subsidiaries,
taken as a whole, and each has full power and authority to own, lease and
operate its properties and assets and conduct its business as described in
each of the Registration Statements and the Prospectus; all of the issued
and outstanding shares of capital stock, limited liability company
interests or partnership interests, as the case may be, of each of the
Company's subsidiaries have been duly authorized and are fully paid and
non-assessable and, except for SFT II, Inc., pledges made in connection
with the Company's $300 million revolving credit facility maturing in July
2003 and as otherwise set forth in the Prospectus, are owned beneficially
by the Company free and clear of any security interests, liens,
encumbrances, equities or claims. The only subsidiaries of the Company are
the subsidiaries listed on Schedule D hereto.
(ix) AUTHORIZATION OF AGREEMENT. The execution and delivery of
this Agreement have been duly authorized by all necessary corporate action
of the Company, and this Agreement has been duly executed and delivered by
the Company and, assuming due authorization, execution and delivery by the
other parties hereto, will be the valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms.
(x) AUTHORIZATION AND DESCRIPTION OF SECURITIES. The Securities
to be purchased by the Underwriters from the Company have been duly
authorized for issuance and sale to the Underwriters pursuant to this
Agreement and, when issued and delivered by the Company pursuant to this
Agreement against payment of the consideration set forth herein, will be
validly issued and fully paid and non-assessable; the Common Stock conforms
to all statements relating thereto contained in the Prospectus and such
description conforms to the rights set forth in the instruments defining
the same; no holder of the Securities will be subject to personal liability
by reason of being such a holder; and the issuance of the Securities is not
subject to the preemptive or other similar rights of any securityholder of
the Company.
(xi) ABSENCE OF DEFAULTS AND CONFLICTS. The execution and
delivery by the Company of, and the performance by the Company of its
obligations under, this Agreement, the compliance by the Company with the
provisions of this Agreement and the consummation of the transactions
herein contemplated do not (x) require the consent, approval,
authorization, registration or qualification of or with any governmental
authority, except such as have been obtained or made or such as may be
required by the state securities or Blue Sky laws of the various states of
the United States of America or other U.S. jurisdictions in connection with
the offer and sale of the Securities by the Underwriters, or (y) conflict
with or result in a breach or violation of any of the terms and provisions
of, or constitute a default under, any indenture, mortgage, deed of trust,
lease or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries
or any of their respective
6
properties are bound, or the charter documents or by-laws of the Company or
any of its subsidiaries, or any statute or any judgment, decree, order,
rule or regulation of any court or other governmental authority or any
arbitrator applicable to the Company or any of its subsidiaries.
(xii) NO VIOLATIONS. Neither the Company nor any of its
subsidiaries is in violation of any term or provision of its charter
documents or by-laws, or in breach of or in default under any statute or
any judgment, decree, order, rule or regulation of any court or other
governmental authority or any arbitrator applicable to the Company or any
of its subsidiaries, the consequence of which violation, breach or default
would have a materially adverse effect on or constitute a materially
adverse change in, or constitute a development involving a prospective
materially adverse effect on or change in, the condition (financial or
otherwise), earnings, properties, business affairs or business prospects,
net worth or results of operations of the Company or of its subsidiaries,
taken as a whole.
(xiii) INVESTMENT COMPANY ACT. The Company is not an "investment
company" and, after giving effect to the offering of the Securities
contemplated by this Agreement and the application of the proceeds
therefrom, will not be an "investment company", as such term is defined in
the Investment Company Act of 1940, as amended (the "1940 Act").
(xiv) TITLE TO PROPERTY. The Company and each of its subsidiaries
have good and marketable title in fee simple to all items of real property
and marketable title to all personal property owned by each of them, in
each case free and clear of any security interests, liens, encumbrances,
equities, claims and other defects, except such as do not materially and
adversely affect the value of such property and do not interfere with the
use made or proposed to be made of such property by the Company or such
subsidiary, and any real property and buildings held under lease by the
Company or any such subsidiary are held under valid, subsisting and
enforceable leases, with such exceptions as are not material and do not
interfere with the use made or proposed to be made of such property and
buildings by the Company or such subsidiary, in each case except as
described in or contemplated by the Prospectus.
(xv) POSSESSION OF INTELLECTUAL PROPERTY. The Company and its
subsidiaries own or possess, or can acquire on reasonable terms, all
material patents, patent applications, trademarks, service marks, trade
names, licenses, know-how, copyrights, trade secrets and proprietary or
other confidential information necessary to operate the business now
operated by them, and neither the Company nor any such subsidiary has
received any notice of infringement of or conflict with asserted rights of
any third party with respect to any of the foregoing which, singly or in
the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a materially adverse effect on or constitute a
materially adverse change in, or constitute a development involving a
prospective materially adverse effect on or change in, the condition
(financial or otherwise), earnings, properties, business affairs or
business prospects, stockholders'
7
equity, net worth or results of operations of the Company or any of its
subsidiaries, taken as a whole, except as described in or contemplated by
the Prospectus.
(xvi) POSSESSION OF LICENSES AND PERMITS. The Company and its
subsidiaries possess all consents, licenses, certificates, authorizations
and permits issued by the appropriate federal, state or foreign regulatory
authorities necessary to conduct their respective businesses, and neither
the Company nor any such subsidiary has received any notice of proceedings
relating to the revocation or modification of any such certificate,
authorization or permit which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would have a materially
adverse effect on or constitute a materially adverse change in, or
constitute a development involving a prospective materially adverse effect
on or change in, the condition (financial or otherwise), earnings,
properties, business affairs or business prospects, net worth or results of
operations of the Company or any of its subsidiaries, taken as a whole,
except as described in or contemplated by the Prospectus.
(xvii) INDEPENDENT ACCOUNTANTS. PricewaterhouseCoopers LLP, who has
certified certain financial statements of the Company and its consolidated
subsidiaries and delivered their report with respect to the audited
consolidated financial statements and schedules included or incorporated in
each of the Registration Statements and the Prospectus, are independent
public accountants as required by the 1933 Act and the 1933 Act
Regulations.
(xviii) FINANCIAL STATEMENTS. The consolidated financial statements
and schedules of the Company and its consolidated subsidiaries included or
incorporated in each of the Registration Statements and the Prospectus were
prepared in accordance with generally accepted accounting principles
("GAAP") consistently applied throughout the periods involved (except as
otherwise noted therein) and they present fairly the financial condition of
the Company as at the dates at which they were prepared and the results of
operations of the Company in respect of the periods for which they were
prepared.
(xix) INTERNAL ACCOUNTING CONTROLS. The Company and each of its
subsidiaries maintain a system of internal accounting controls sufficient
to provide reasonable assurance that (w) transactions are executed in
accordance with management's general or specific authorizations; (x)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain asset accountability;
(y) access to assets is permitted only in accordance with management's
general or specific authorization; and (z) the recorded accountability for
assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(xx) LITIGATION. No legal or governmental proceedings are pending
or threatened to which the Company or any of its subsidiaries is a party or
to which the property of the Company or any of its subsidiaries is subject
that are required to be described in either of the Registration Statements
or the Prospectus and are not described therein; and no statutes,
regulations, contracts or other documents that are required to be
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described or incorporated in either of the Registration Statements or the
Prospectus or to be filed as exhibits to either of the Registration
Statements that are not described or incorporated therein or filed as
required.
(xxi) DIVIDENDS AND DISTRIBUTIONS. The Company is not currently
prohibited, directly or indirectly, from paying any dividends or making any
other distribution on its capital stock, except for restrictions upon the
occurrence of a default or failure to meet financial covenants or
conditions under existing agreements.
(xxii) REIT STATUS. The Company is organized in conformity with the
requirements for qualification as a real estate investment trust ("REIT")
under Sections 856 through 860 of the Internal Revenue Code of 1986, as
amended (the "Code"), and its method of operation as described in the
Prospectus has enabled it since January 1, 1998, and will enable it to
continue, to meet the requirements for taxation as a REIT under the Code.
(xxiii) TAXES. The Company has filed all foreign, federal, state and
local tax returns that are required to be filed or has requested extensions
thereof (except in any case in which the failure so to file would not have
a materially adverse effect on the Company and its subsidiaries, taken as a
whole) and has paid all taxes required to be paid by it and any other
assessment, fine or penalty levied against it (except in any case in which
the failure so to pay would not have a materially adverse effect on the
Company and its subsidiaries, taken as a whole), to the extent that any of
the foregoing is due and payable, except for any such assessment, fine or
penalty that is currently being contested in good faith or as described in
or contemplated by the Prospectus.
(xxiv) INSURANCE. The Company and each of its subsidiaries are
insured by insurers of recognized financial responsibility against such
losses and risks and in such amounts as are prudent and customary in the
businesses in which they are engaged; neither the Company nor any such
subsidiary has been refused any insurance coverage sought or applied for;
and neither the Company nor any such subsidiary has any reason to believe
that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue its business at a cost that would
not materially and adversely affect the condition (financial or otherwise),
earnings, properties, business affairs or business prospects, net worth or
results of operations of the Company or any of its subsidiaries, taken as a
whole, except as described in or contemplated by the Prospectus.
(xxv) PENSION PLANS. The Company and each of its subsidiaries is
in compliance in all material respects with all presently applicable
provisions of the Employee Retirement Income Security Act of 1974, as
amended, including the regulations and published interpretations thereunder
("ERISA"); no "reportable event" (as defined in ERISA) has occurred with
respect to any "pension plan" (as defined in ERISA) for which the Company
would reasonably be expected to have any liability; the Company has not
incurred and does not expect to incur liability under (x) Title IV of ERISA
with respect to termination of, or withdrawal from, any "pension plan" or
(y) Sections 412 or 4971 of the
9
Code or the regulations and published interpretations thereunder; and each
"pension plan" for which the Company would have any liability that is
intended to be qualified under Section 401(a) of the Code has received a
determination letter from the Internal Revenue Service to the effect that
it is so qualified in all material respects and nothing has occurred,
whether by action or by failure to act, which would cause the plan to not
be adversely affected by such determination.
(xxvi) ABSENCE OF LABOR DISPUTE. No labor dispute with the
employees of the Company or any of its subsidiaries exists or is threatened
or imminent that could have a materially adverse effect on or constitute a
materially adverse change in, or constitute a development involving a
prospective materially adverse effect on or change in, the condition
(financial or otherwise), properties, management, earnings, business
affairs or business prospects, net worth or results of operations of the
Company or any of its subsidiaries, taken as a whole, except as described
in or contemplated by the Prospectus.
(xxvii) ENVIRONMENTAL LAWS. Except as described in or contemplated
by the Prospectus, and except as would not otherwise reasonably be expected
to have a material adverse effect on the financial condition or results of
operations of the Company and its subsidiaries, taken as a whole, (A) the
Company and each of its subsidiaries is in compliance with and not subject
to any known liability under applicable Environmental Laws (as defined
below), (B) the Company and each of its subsidiaries has made all filings
and provided all notices required under any applicable Environmental Law,
(C) there is no civil, criminal or administrative action, suit, demand,
claim, hearing, notice of violation, investigation, proceeding, notice or
demand letter or request for information pending or, to the best knowledge
of the Company, threatened against the Company or any of its subsidiaries
under any Environmental Law, (D) no lien, charge, encumbrance or
restriction has been recorded under any Environmental Law with respect to
any assets, facility or property owned, operated or leased by the Company
or any of its subsidiaries, (E) neither the Company nor any of its
subsidiaries has received notice that it has been identified as a
potentially responsible party under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended ("CERCLA"), or
any comparable law, (F) no property owned or operated by the Company or any
of its subsidiaries is (i) listed or, to the best knowledge of the Company,
proposed for listing on the National Priorities List under CERCLA or (ii)
listed in the Comprehensive Environmental Response, Compensation and
Liability Information System List promulgated pursuant to CERCLA, or on any
comparable list maintained by any governmental authority, (G) neither the
Company nor any of its subsidiaries is subject to any order, decree or
agreement requiring, or otherwise obligated or required to perform any
response or corrective action under any Environmental Law, (H) there are no
past or present actions, occurrences or operations which could reasonable
be expected to prevent or interfere with compliance by the Company with any
applicable Environmental Law or to result in liability under any applicable
Environmental Law. For purposes of this Agreement, "Environmental Laws"
means the common law and all applicable foreign, federal, provincial, state
and local laws or regulations, codes, orders, decrees, judgments or
injunctions issued, promulgated, approved or entered thereunder, relating
to pollution or protection of public or employee health and safety or the
environment (including,
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without limitation, ambient air, surface water, groundwater, land surface
or subsurface strata), including, without limitation, laws relating to (i)
emissions, discharges, releases or threatened releases of Hazardous
Materials into the environment, (ii) the manufacture, processing,
distribution, use, generation, treatment, storage, disposal, transport or
handling of Hazardous Materials and (iii) underground and aboveground
storage tanks and related piping, and emissions, discharges, releases or
threatened releases therefrom. "Hazardous Material" means any pollutant,
contaminant, waste, chemical, substance or constituent, including, without
limitation, petroleum or petroleum products subject to regulation or which
can give rise to liability under any Environmental Laws.
(xxviii) OTHER AGREEMENTS. No default exists, and no event has
occurred which, with notice or lapse of time or both, would constitute a
default in the due performance and observance of any term, covenant or
condition of any indenture, mortgage, deed of trust, lease or other
agreement or instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries or any of their
respective properties is bound, except any default that would not have a
materially adverse effect on the Company and its subsidiaries, taken as a
whole.
(xxix) ABSENCE OF MATERIALLY ADVERSE CHANGE. Subsequent to the
respective dates as of which information is given in each of the
Registration Statements and the Prospectus, neither the Company nor any of
its subsidiaries has sustained any material loss or interference with their
respective businesses or properties from fire, flood, hurricane, accident
or other calamity, whether or not covered by insurance, or from any labor
dispute or any legal or governmental proceeding, and there has been no
materially adverse change (including, without limitation, a change in
management or control), or development involving a prospective materially
adverse change, in the condition (financial or otherwise), management,
earnings, property, business affairs or business prospects, stockholders'
equity, net worth or results of operations of the Company or any of its
subsidiaries, taken as a whole, other than as described in or contemplated
by the Prospectus (exclusive of any amendments or supplements thereto).
(xxx) NO RECEIVER OR LIQUIDATOR. No receiver or liquidator (or
similar person) has been appointed in respect of the Company or any
subsidiary of the Company or in respect of any part of the assets of the
Company or any subsidiary of the Company; no resolution, order of any
court, regulatory body, governmental body or otherwise, or petition or
application for an order, has been passed, made or presented for the
winding up of the Company or any subsidiary of the Company or for the
protection of the Company or any such subsidiary from its creditors; and
the Company has not, and no subsidiary of the Company has, stopped or
suspended payments of its debts, become unable to pay its debts or
otherwise become insolvent.
(xxxi) NEW YORK STOCK EXCHANGE LISTING. The Company's Common Stock
is listed on the New York Stock Exchange. The Securities have been approved
for listing on the New York Stock Exchange.
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(b) REPRESENTATIONS AND WARRANTIES BY THE SELLING STOCKHOLDER. The Selling
Stockholder represents and warrants to each Underwriter as of the date hereof,
as of the Closing Time and as of each Date of Delivery (if any), and agrees with
each Underwriter, as follows:
(i) ACCURATE DISCLOSURE. None of the statements made in any
Preliminary Prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information
furnished to the Company by the Selling Stockholder expressly for use in
such Preliminary Prospectus or the Prospectus (or any amendment or
supplement thereto) includes any untrue statement of a material fact or
omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
(ii) AUTHORIZATION OF AGREEMENT. The Selling Stockholder has
limited liability company right, power and authority to enter into this
Agreement and to sell, transfer and deliver the Securities to be sold by
the Selling Stockholder hereunder. The execution and delivery of this
Agreement and the sale and delivery of the Securities to be sold by the
Selling Stockholder and the consummation of the transactions contemplated
herein and compliance by the Selling Stockholder with its obligations
hereunder have been duly authorized by the Selling Stockholder and do not
and will not, whether with or without the giving of notice or passage of
time or both, conflict with or constitute a breach of, or default under, or
result in the creation or imposition of any lien, charge or encumbrance
upon the Securities to be sold by the Selling Stockholder or any property
or assets of the Selling Stockholder pursuant to any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, license, lease or
other agreement or instrument to which the Selling Stockholder is a party
or by which the Selling Stockholder may be bound, or to which any of the
property or assets of the Selling Stockholder is subject, nor will such
action result in any violation of the provisions of the charter or by-laws
or other organizational instrument of the Selling Stockholder, if
applicable, or any applicable treaty, law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the
Selling Stockholder or any of its properties.
(iii) GOOD AND MARKETABLE TITLE. The Selling Stockholder will at
the Closing Time and, if any Option Securities are purchased from the
Selling Stockholder, on the Date of Delivery, have good and marketable
title to the Securities to be sold by the Selling Stockholder hereunder,
free and clear of any security interest, mortgage, pledge, lien, charge,
claim, equity or encumbrance of any kind, other than pursuant to this
Agreement; and upon delivery of such Securities and payment of the purchase
price therefor as herein contemplated, assuming each such Underwriter has
no notice of any adverse claim, each of the Underwriters will receive good
and marketable title to the Securities purchased by it from the Selling
Stockholder, free and clear of any security interest, mortgage, pledge,
lien, charge, claim, equity or encumbrance of any kind.
(iv) DUE EXECUTION AND DELIVERY OF AGREEMENT. The Selling
Stockholder has duly executed and delivered this Agreement, and assuming
the due authorization, execution and delivery by the other parties hereto,
this Agreement will be the valid and
12
binding agreement of the Selling Stockholder, enforceable against the
Selling Stockholder in accordance with its terms.
(v) ABSENCE OF MANIPULATION. The Selling Stockholder has not
taken, and will not take, directly or indirectly, any action which is
designed to or which has constituted or which might reasonably be expected
to cause or result in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Securities.
(vi) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or consent,
approval, authorization, order, registration, qualification or decree of,
any court or governmental authority or agency, domestic or foreign, is
necessary or required for the performance by the Selling Stockholder of its
obligations hereunder or in connection with the sale and delivery of the
Securities hereunder or the consummation of the transactions contemplated
by this Agreement, except such as may have previously been made or obtained
or as may be required under the 1933 Act or the 1933 Act Regulations or
state securities laws.
(vii) CERTIFICATES SUITABLE FOR TRANSFER. Certificates for all of
the Securities to be sold by the Selling Stockholder pursuant to this
Agreement, in suitable form for transfer by delivery or accompanied by duly
executed instruments of transfer or assignment in blank with signatures
guaranteed, will be delivered to the Underwriters pursuant to this
Agreement.
(viii) NO ASSOCIATION WITH NASD. Neither the Selling Stockholder
nor any of its affiliates directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control
with, or has any other association with (within the meaning of Article I,
Section 1(m) of the By-laws of the NASD), any member firm of the NASD.
(c) OFFICER'S CERTIFICATES. Any certificate signed by any officer of the
Company or any of its subsidiaries delivered to the Representatives or to
counsel for the Underwriters shall be deemed a representation and warranty by
the Company to each Underwriter as to the matters covered thereby; and any
certificate signed by or on behalf of the Selling Stockholder as such and
delivered to the Representatives or to counsel for the Underwriters pursuant to
the terms of this Agreement shall be deemed a representation and warranty by the
Selling Stockholder to the Underwriters as to the matters covered thereby.
SECTION 2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING.
(a) INITIAL SECURITIES. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, each
of the Company and the Selling Stockholder, severally and not jointly, agrees to
sell to each Underwriter, severally and not jointly, and each Underwriter,
severally and not jointly, agrees to purchase from each of the Company and the
Selling Stockholder, at the price per share set forth in Schedule C, that
proportion of the number of Initial Securities set forth in Schedule B opposite
the name of the Company or the Selling Stockholder, as the case may be, which
the number of Initial Securities
13
set forth in Schedule A opposite the name of such Underwriter, plus any
additional number of Initial Securities which such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof, bears to
the total number of Initial Securities, subject, in each case, to such
adjustments among the Underwriters as the Representatives in their sole
discretion shall make to eliminate any sales or purchases of fractional
securities.
(b) OPTION SECURITIES. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Selling Stockholder hereby grants an option to the Underwriters,
severally and not jointly, to purchase up to an additional 1,500,000 shares of
Common Stock, as set forth in Schedule B, at the price per share set forth in
Schedule C, less an amount per share equal to any dividends or distributions
declared by the Company and payable on the Initial Securities but not payable on
the Option Securities. The option hereby granted will expire 30 days after the
date hereof and may be exercised in whole or in part from time to time only for
the purpose of covering over-allotments which may be made in connection with the
offering and distribution of the Initial Securities upon notice by the
Representatives to the Selling Stockholder setting forth the number of Option
Securities as to which the several Underwriters are then exercising the option
and the time and date of payment and delivery for such Option Securities. Any
such time and date of delivery (a "Date of Delivery") shall be determined by the
Representatives, but shall not be less than two nor later than seven full
business days after the exercise of said option, nor in any event prior to the
Closing Time, as hereinafter defined. If the option is exercised as to all or
any portion of the Option Securities, each of the Underwriters, acting severally
and not jointly, will purchase from the Selling Stockholder that proportion of
the total number of Option Securities then being purchased which the number of
Initial Securities set forth in Schedule A opposite the name of such Underwriter
bears to the total number of Initial Securities, subject in each case to such
adjustments as the Representatives in their discretion shall make to eliminate
any sales or purchases of fractional shares.
(c) PAYMENT. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, Xxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, or at such other place as shall be agreed upon by the Representatives,
the Company and the Selling Stockholder, at 9:00 A.M. (Eastern time) on November
20, 2002 (unless postponed in accordance with the provisions of Section 10), or
such other time not later than ten business days after such date as shall be
agreed upon by the Representatives, the Company and the Selling Stockholder
(such time and date of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Representatives,
the Company and the Selling Stockholder, on each Date of Delivery as specified
in the notice from the Representatives to the Company and the Selling
Stockholder.
Payment shall be made to the Company and the Selling Stockholder by wire
transfer of immediately available funds to one or more bank accounts designated
by the Company and by
14
the Selling Stockholder, as the case may be, against delivery to the
Representatives for the respective accounts of the Underwriters of certificates
for the Securities to be purchased by them. It is understood that each
Underwriter has authorized the Representatives, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Initial Securities and the Option Securities, if any, which it has agreed to
purchase. Either of the Representatives, individually and not as representative
of the Underwriters, may (but shall not be obligated to) make payment of the
purchase price for the Initial Securities or the Option Securities, if any, to
be purchased by any Underwriter whose funds have not been received by the
Closing Time or the relevant Date of Delivery, as the case may be, but such
payment shall not relieve such Underwriter from its obligations hereunder.
(d) DENOMINATIONS; REGISTRATION. Certificates for the Initial Securities
and the Option Securities, if any, shall be in such denominations and registered
in such names as the Representatives may request in writing at least one full
business day before the Closing Time or the relevant Date of Delivery, as the
case may be. The certificates for the Initial Securities and the Option
Securities, if any, will be made available for examination and packaging by the
Representatives in The City of New York not later than 10:00 A.M. (Eastern time)
on the business day prior to the Closing Time or the relevant Date of Delivery,
as the case may be.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with each
Underwriter as follows:
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
under the 1933 Act and will notify the Representatives immediately, and confirm
the notice in writing, (A) when any post-effective amendment to either of the
Registration Statements shall become effective, or any supplement to the
Prospectus or any amended Prospectus shall have been filed, (B) of the receipt
of any comments from the Commission, (C) of any request by the Commission for
any amendment to either of the Registration Statements or any amendment or
supplement to the Prospectus or for additional information, and (D) of the
issuance by the Commission of any stop order suspending the effectiveness of
either of the Registration Statements or of any order preventing or suspending
the use of any Preliminary Prospectus, or of the suspension of the qualification
of the Securities for offering or sale in any jurisdiction, or of the initiation
or threatening of any proceedings for any of such purposes. The Company will
promptly effect the filings necessary pursuant to Rule 424(b) under the 1933 Act
and will take such steps as it deems necessary to ascertain promptly whether the
form of prospectus transmitted for filing under Rule 424(b) was received for
filing by the Commission and, in the event that it was not, it will promptly
file such prospectus. The Company will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) FILING OF AMENDMENTS. The Company will give the Representatives notice
of its intention to file or prepare any amendment to either of the Registration
Statements (including any filing under Rule 462(b)) or any amendment, supplement
or revision to either the prospectus included in either of the Registration
Statements at the time it became effective or to the Prospectus, whether
pursuant to the 1933 Act, the 1934 Act or otherwise, will furnish the
15
Representatives with copies of any such documents a reasonable amount of time
prior to such proposed filing or use, as the case may be, and will not file or
use any such document to which the Representatives or counsel for the
Underwriters shall object.
(c) DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished or will
deliver to the Representatives and counsel for the Underwriters, without charge,
signed copies of each of the Registration Statements as originally filed and of
each amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated or deemed to be incorporated by
reference therein) and signed copies of all consents and certificates of
experts, and will also deliver to the Representatives, without charge, a
conformed copy of each of the Registration Statements as originally filed and of
each amendment thereto (without exhibits) for each of the Underwriters. The
copies of each of the Registration Statements and each amendment thereto
furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX, except
to the extent permitted by Regulation S-T.
(d) DELIVERY OF PROSPECTUSES. The Company has delivered to each
Underwriter, without charge, as many copies of each Preliminary Prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, such
number of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any amendments or
supplements thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the Securities
as contemplated in this Agreement and in the Prospectus. If at any time when a
prospectus is required by the 1933 Act to be delivered in connection with sales
of the Securities, any event shall occur or condition shall exist as a result of
which it is necessary, in the reasonable opinion of counsel for the Underwriters
or for the Company, to amend either of the Registration Statements or amend or
supplement the Prospectus in order that the Prospectus will not include any
untrue statements of a material fact or omit to state a material fact necessary
in order to make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the reasonable opinion of such counsel, at any such time
to amend either of the Registration Statements or amend or supplement the
Prospectus in order to comply with the requirements of the 1933 Act or the 1933
Act Regulations, the Company will promptly prepare and file with the Commission,
subject to Section 3(b), such amendment or supplement as may be necessary to
correct such statement or omission or to make the Registration Statements or the
Prospectus comply with such requirements, and the Company will furnish to the
Underwriters such number of copies of such amendment or supplement as the
Underwriters may reasonably request.
(f) BLUE SKY QUALIFICATIONS. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify, if necessary, the Securities for
offering and sale under the
16
applicable securities laws of such states and other jurisdictions as the
Representatives may designate and to maintain such qualifications in effect for
a period of not less than one year from the later of the effective date of each
of the Registration Statements and any Rule 462(b) Registration Statement;
provided, however, that the Company shall not be obligated to file any general
consent to service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so qualified or to
subject itself to taxation in respect of doing business in any jurisdiction in
which it is not otherwise so subject. In each jurisdiction in which the
Securities have been so qualified, the Company will file such statements and
reports as may be required by the laws of such jurisdiction to continue such
qualification in effect for a period of not less than one year from the
effective date of each of the Registration Statements and any Rule 462(b)
Registration Statement.
(g) RULE 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) USE OF PROCEEDS. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus under
the heading "Use of Proceeds".
(i) QUALIFICATION AS A REIT. The Company will use its best efforts to
continue to meet the requirements to qualify as a REIT under the Code, subject
to the fiduciary duties of the Board of Directors of the Company to manage the
business of the Company in the best interest of its stockholders.
(j) RESTRICTION ON SALE OF SECURITIES. During a period of 90 days from the
date of the Prospectus, the Company will not, without the prior written consent
of Xxxxxx Brothers, (i) directly or indirectly, offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase or otherwise transfer or
dispose of any share of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock or file any registration statement
under the 1933 Act with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of the
Common Stock, whether any such swap or transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence shall not apply to (A)
the Securities to be sold hereunder, (B) any shares of Common Stock issued by
the Company upon the exercise of an option or warrant or the conversion of a
security outstanding on the date hereof and referred to in the Prospectus, (C)
any shares of Common Stock issued or options to purchase Common Stock granted
pursuant to employee benefit plans or employment agreements of the Company
approved by the Board of Directors of the Company, (D) any shares of Common
Stock issued pursuant to any non-employee dividend reinvestment plan, (E) any
shares of Common Stock issued in mergers, acquisitions or other business
combination transactions, (F) the filing of any universal shelf registration
statement under the 1933 Act covering securities of the Company or (G) the
filing of any registration statement under the 1933 Act covering resales of
shares of Common Stock.
17
(k) REPORTING REQUIREMENTS. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
SECTION 4. PAYMENT OF EXPENSES.
(a) EXPENSES. The Company will pay or cause to be paid all expenses
incident to the performance of the obligations of the Company and the Selling
Stockholder under this Agreement, including (i) the preparation, printing and
filing of any amendments to either of the Registration Statements (including
financial statements and exhibits), (ii) the preparation, printing and delivery
to the Underwriters of this Agreement, any Agreement among Underwriters and such
other documents as may be required in connection with the offering, purchase,
sale or delivery of the Securities, (iii) the preparation and delivery of the
certificates for the Securities to the Underwriters, (iv) the fees and
disbursements of the Company's counsel, accountants and other advisors, (v) the
qualification of the Securities under securities laws in accordance with the
provisions of Section 3(f) hereof, including filing fees and the reasonable fees
and disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of the Blue Sky Survey and any supplement
thereto, (vi) the printing and delivery to the Underwriters of copies of each
Preliminary Prospectus and of the Prospectus and any amendments or supplements
thereto, (vii) the preparation, printing and delivery to the Underwriters of
copies of the Blue Sky Survey and any supplement thereto, (viii) the fees and
expenses of any transfer agent or registrar for the Securities, (ix) the fees
and expenses incurred in connection with the listing of the Securities on the
New York Stock Exchange, if any, and (x) all costs and expenses of the
Underwriters in connection with matters related to the Reserved Securities which
are designated by the Company for sale to officers and directors of the Company.
(b) EXPENSES OF THE SELLING STOCKHOLDER. The Selling Stockholder will pay
all expenses incident to the performance of its obligations under, and the
consummation of the transactions contemplated by this Agreement, including (i)
any stamp duties, capital duties or other duties and any stock or other transfer
taxes, if any, payable upon the sale or delivery of the Securities to the
Underwriters, and their transfer between the Underwriters pursuant to an
agreement between such Underwriters, and (ii) the fees and disbursements of its
counsel.
(c) TERMINATION OF AGREEMENT. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5(o) (to the extent
any condition specified in Section 5(a), (b), (c), (g), (i), (j), (k), (m)(i),
(m)(iii), (m)(iv), (m)(viii) or (n) shall not have been fulfilled when and as
required to be fulfilled), Section 9(a)(i) or Section 11 hereof (with respect to
a default by the Company), the Company shall reimburse the Underwriters for all
of their out-of-pocket expenses, including the reasonable fees and disbursements
of counsel for the Underwriters. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5(o) (to the extent
any condition specified in Section 5(d), (e), (h), (l), (m)(ii), (m)(v) or
(m)(vi) shall not have been fulfilled when and as required to be fulfilled) or
Section 11 hereof (with respect to a default by the Selling Stockholder), the
Selling Stockholder
18
shall reimburse the Underwriters for all of their out-of-pocket expenses,
including the reasonable fees and disbursements of counsel for the Underwriters.
(d) ALLOCATION OF EXPENSES. The provisions of this Section shall not
affect any agreement that the Company and the Selling Stockholder shall have
made or may make for the sharing of such costs and expenses.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the
several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Selling Stockholder
contained in Section 1 hereof or in certificates of any officer of the Company
or any subsidiary of the Company or on behalf of the Selling Stockholder
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENTS; FILING OF PROSPECTUS
SUPPLEMENT. Each of the Registration Statements, including any Rule 462(b)
Registration Statement, has become effective and at Closing Time no stop order
suspending the effectiveness of such Registration Statement shall have been
issued under the 1933 Act or proceedings therefor initiated or threatened by the
Commission, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of
counsel to the Underwriters. The Prospectus, as supplemented by the prospectus
supplement relating to the offering of the Securities, shall have been filed
with the Commission pursuant to Rule 424(b) under the 1933 Act within the
applicable time period prescribed for such filing by the regulations promulgated
under the 1933 Act and in accordance with Section 3(a) hereof.
(b) OPINION OF SPECIAL COUNSEL FOR THE COMPANY. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Xxxxxxxx Chance US LLP, special counsel for the Company, in form and
substance satisfactory to counsel for the Underwriters, together with signed or
reproduced copies of such letter for each of the other Underwriters, to the
effect set forth in Exhibit A hereto and to such further effect as counsel to
the Underwriters may reasonably request.
(c) OPINION OF MARYLAND COUNSEL FOR THE COMPANY. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Xxxxxxx Xxxxx Xxxxxxx & Ingersoll, LLP, Maryland counsel for the
Company, in form and substance satisfactory to counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of the other
Underwriters.
(d) OPINION OF COUNSEL FOR THE SELLING STOCKHOLDER. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Xxxxxxx, Xxxxxxxxxxx & Xxxxxxxx, LLC, counsel for the Selling
Stockholder, in form and substance satisfactory to counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of the other
Underwriters, to the effect set forth in Exhibit B hereto and to such further
effect as counsel to the Underwriters may reasonably request.
(e) OPINION OF SPECIAL COUNSEL FOR THE SELLING STOCKHOLDER. At Closing
Time, the Representatives shall have received the favorable opinion, dated as of
Closing Time, of Dechert,
19
special counsel for the Selling Stockholder, in form and substance satisfactory
to counsel for the Underwriters, together with signed or reproduced copies of
such letter for each of the other Underwriters, to the effect set forth in
Exhibit C hereto and to such further effect as counsel to the Underwriters may
reasonably request.
(f) OPINION OF SPECIAL COUNSEL FOR UNDERWRITERS. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, special counsel for the
Underwriters, together with signed or reproduced copies of such letter for each
of the other Underwriters, with respect to each of the Registration Statements
and the Prospectus and such other related matters as the Representatives may
reasonably require. In giving such opinion such counsel need not opine as to
matters governed by the laws of jurisdictions other than the law of the State of
New York and the federal law of the United States. Such counsel may also state
that, insofar as such opinion involves factual matters, they have relied, to the
extent they deem proper, upon certificates of officers of the Company and its
subsidiaries and certificates of public officials.
(g) OFFICERS' CERTIFICATE. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and the Representatives shall have
received a certificate of the Chief Executive Officer of the Company and of the
Chief Financial Officer of the Company, dated as of Closing Time, to the effect
that (i) there has been no such material adverse change, (ii) the
representations and warranties in Section 1(a) hereof are true and correct with
the same force and effect as though expressly made at and as of Closing Time,
(iii) the Company has complied with all agreements and satisfied all conditions
on its part to be performed or satisfied at or prior to Closing Time, and (iv)
no stop order suspending the effectiveness of either of the Registration
Statements has been issued and no proceedings for that purpose have been
instituted or are pending or are contemplated by the Commission.
(h) CERTIFICATES OF SELLING STOCKHOLDER. At Closing Time, the
Representatives shall have received a certificate of the Selling Stockholder,
dated as of Closing Time, to the effect that (i) the representations and
warranties of the Selling Stockholder contained in Section 1(b) hereof are true
and correct in all respects with the same force and effect as though expressly
made at and as of Closing Time and (ii) the Selling Stockholder has complied in
all material respects with all agreements and all conditions on its part to be
performed under this Agreement at or prior to Closing Time.
(i) ACCOUNTANT'S COMFORT LETTER. At the time of the execution of this
Agreement, the Representatives shall have received from PricewaterhouseCoopers
LLP a letter dated such date, in form and substance satisfactory to the
Representatives, together with signed or reproduced copies of such letter for
each of the other Underwriters, containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statements and the Prospectus.
20
(j) BRING-DOWN COMFORT LETTER. At Closing Time, the Representatives shall
have received from PricewaterhouseCoopers LLP a letter, dated as of Closing
Time, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (i) of this Section, except that the specified
date referred to shall be a date not more than three business days prior to
Closing Time.
(k) APPROVAL OF LISTING. At Closing Time, the Securities shall have been
approved for listing on the New York Stock Exchange.
(l) LOCK-UP AGREEMENT. At the date of this Agreement, the Representatives
shall have received an agreement substantially in the form of Exhibit D hereto
signed by the Selling Stockholder.
(m) CONDITIONS TO PURCHASE OF OPTION SECURITIES. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to purchase
all or any portion of the Option Securities, the representations and warranties
of the Company and the Selling Stockholder contained herein and the statements
in any certificates furnished by the Company, any subsidiary of the Company and
the Selling Stockholder hereunder shall be true and correct as of each Date of
Delivery and, at the relevant Date of Delivery, the Representatives shall have
received:
(i) OFFICERS' CERTIFICATE. A certificate, dated such Date of
Delivery, of the Chief Executive Officer of the Company and of the Chief
Financial Officer of the Company confirming that the certificate delivered
at the Closing Time pursuant to Section 5(g) hereof remains true and
correct as of such Date of Delivery.
(ii) CERTIFICATE OF SELLING STOCKHOLDER. A certificate, dated
such Date of Delivery, of the Selling Stockholder confirming that the
certificate delivered at Closing Time pursuant to Section 5(h) remains true
and correct as of such Date of Delivery.
(iii) OPINION OF SPECIAL COUNSEL FOR COMPANY. The favorable
opinion of Xxxxxxxx Chance US LLP, counsel for the Company, in form and
substance satisfactory to counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required by
Section 5(b) hereof.
(iv) OPINION OF MARYLAND COUNSEL FOR COMPANY. The favorable
opinion of Xxxxxxx Xxxxx Xxxxxxx & Ingersoll, LLP, Maryland counsel for the
Company, in form and substance satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to the
same effect as the opinion required by Section 5(c) hereof.
(v) OPINION OF COUNSEL FOR THE SELLING STOCKHOLDER. The
favorable opinion of Xxxxxxx, Xxxxxxxxxxx & Xxxxxxxx, LLC, counsel for the
Selling Stockholder, in form and substance satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to the
same effect as the opinion required by Section 5(d) hereof.
21
(vi) OPINION OF SPECIAL COUNSEL FOR THE SELLING STOCKHOLDER. The
favorable opinion of Dechert, special counsel for the Selling Stockholder,
in form and substance satisfactory to counsel for the Underwriters, dated
such Date of Delivery, relating to the Option Securities to be purchased on
such Date of Delivery and otherwise to the same effect as the opinion
required by Section 5(e) hereof.
(vii) OPINION OF COUNSEL FOR UNDERWRITERS. The favorable opinion
of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, special counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to the
same effect as the opinion required by Section 5(f) hereof.
(viii) BRING-DOWN COMFORT LETTER. A letter from
PricewaterhouseCoopers LLP, in form and substance satisfactory to the
Representatives and dated such Date of Delivery, substantially in the same
form and substance as the letter furnished to the Representatives pursuant
to Section 5(j) hereof, except that the "specified date" in the letter
furnished pursuant to this paragraph shall be a date not more than three
business days prior to such Date of Delivery.
(n) ADDITIONAL DOCUMENTS. At Closing Time and at each Date of Delivery
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may require for the purpose of enabling them to pass upon the
sale of the Securities as herein contemplated, or in order to evidence the
accuracy of any of the representations or warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings taken by the Company
and the Selling Stockholder in connection with the sale of the Securities as
herein contemplated shall be reasonably satisfactory in form and substance to
the Representatives and counsel for the Underwriters.
(o) TERMINATION OF AGREEMENT. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option Securities
on a Date of Delivery which is after the Closing Time, the obligations of the
several Underwriters to purchase the relevant Option Securities, may be
terminated by the Representatives by notice to the Company at any time at or
prior to Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party except as
provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any
such termination and remain in full force and effect.
SECTION 6. INDEMNIFICATION.
(a) INDEMNIFICATION OF UNDERWRITERS BY THE COMPANY. The Company agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act to the extent and in the manner set forth in clauses
(i), (ii) and (iii) below:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in either of the
Registration Statements (or any amendment thereto) or the omission or
alleged omission therefrom of a material fact required to be stated therein
or
22
necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact
included in any Preliminary Prospectus or the Prospectus (or any amendment
or supplement thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid
in settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
6(e) below) any such settlement is effected with the written consent of the
Company and the Selling Stockholder; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the
Representatives), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense
is not paid under clauses (i) or (ii) above;
PROVIDED, HOWEVER, that this indemnity agreement shall not apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made
in reliance upon and in conformity with written information furnished to
the Company by any Underwriter through the Representatives expressly for
use in either of the Registration Statements (or any amendment thereto), or
any Preliminary Prospectus or the Prospectus (or any amendment or
supplement thereto).
(b) INDEMNIFICATION OF UNDERWRITERS BY THE SELLING STOCKHOLDER. The
Selling Stockholder agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act against any and all loss,
liability, claim, damage and expense described in the indemnity contained in
subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in
either of the Registration Statements (or any amendment thereto) or any
Preliminary Prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by the Selling Stockholder expressly for use in either of the
Registration Statements (or any amendment thereto) or such Preliminary
Prospectus or the Prospectus (or any amendment or supplement thereto); PROVIDED,
that the Selling Stockholder shall not be required to indemnify or hold harmless
any person pursuant to this Section 6(b) for any amount in excess of the portion
of the total net proceeds from the offering of the Securities pursuant to this
Agreement (before deducting expenses) received by the Selling Stockholder.
23
(c) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS AND SELLING
STOCKHOLDER. Each Underwriter severally agrees to indemnify and hold harmless
the Company, its directors, each of its officers who signed either of the
Registration Statements, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act,
and the Selling Stockholder and each person, if any, who controls the Selling
Stockholder within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this Section, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in either of the Registration Statements
(or any amendment thereto) or any Preliminary Prospectus or the Prospectus (or
any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Company by such Underwriter through the
Representatives expressly for use in either of the Registration Statements (or
any amendment thereto) or such Preliminary Prospectus or the Prospectus (or any
amendment or supplement thereto).
(d) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) or 6(b)
above, counsel to the indemnified parties shall be selected by the
Representatives, and, in the case of parties indemnified pursuant to Section
6(c) above, counsel to the indemnified parties shall be selected by the Company.
An indemnifying party may participate at its own expense in the defense of any
such action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(e) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
24
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
(f) INDEMNIFICATION FOR RESERVED SECURITIES. In connection with the offer
and sale of the Reserved Securities, the Company agrees, promptly upon a request
in writing, to indemnify and hold harmless each Underwriter and each person, if
any, who controls any Underwriter within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act against any and all loss, liability, claim,
damage and expense incurred by it as a result of the failure of any officers
and/or directors of the Company to pay for and accept delivery of Reserved
Securities which, by the end of the first business day following the date of
this Agreement, were subject to a properly confirmed agreement to purchase. The
Underwriters agree to use their reasonable efforts to sell any such Reserved
Securities to other purchasers as part of the public offering contemplated
hereby and to apply the proceeds from any such sale against any losses,
liabilities, claims, damages and expenses incurred by the Underwriters as a
result of the failure of the Reserved Securities participants to pay for and
accept delivery of such Reserved Securities.
(g) OTHER AGREEMENTS WITH RESPECT TO INDEMNIFICATION AND CONTRIBUTION. The
provisions of this Section shall not affect any agreement between the Company
and the Selling Stockholder with respect to indemnification or contribution,
including without limitation, the Amended and Restated Registration Rights
Agreement, dated March 18, 1998, among the Company, Starwood Mezzanine
Investors, L.P., B Holdings, LLC and the Selling Stockholder.
SECTION 7. CONTRIBUTION. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party referred to therein
which is required to indemnify and hold harmless an indemnified party in respect
of any such losses, liabilities, claims, damages or expenses shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Selling Stockholder on the one hand and the Underwriters on the other hand from
the offering of the Securities pursuant to this Agreement or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company and the
Selling Stockholder on the one hand and of the Underwriters on the other hand in
connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company and the Selling Stockholder
on the one hand and the Underwriters on the other hand in connection with the
offering of the Securities pursuant to this Agreement shall be deemed to be in
the same respective proportions as the total net proceeds from the offering of
the Securities pursuant to this Agreement (before deducting expenses) received
by the Selling Stockholder and the total underwriting discount received by the
Underwriters, in each case as set forth on the cover of the Prospectus.
25
The relative fault of the Company and the Selling Stockholder on the one
hand and the Underwriters on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or the Selling Stockholder or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The Company, the Selling Stockholder and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this
Section 7. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this Section
7 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, (i) no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission and (ii) the Selling
Stockholder shall not be required to contribute any amount in excess of the
portion of the total net proceeds from the offering of the Securities pursuant
to this Agreement (before deducting expenses) received by the Selling
Stockholder.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed either of
the Registration Statements, and each person, if any, who controls the Company
or the Selling Stockholder within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as the
Company or the Selling Stockholder, as the case may be. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the number of Initial Securities set forth opposite their
respective names in Schedule A hereto and not joint.
The provisions of this Section shall not affect any agreement among the
Company and the Selling Stockholder with respect to contribution.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
All representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its subsidiaries or the
Selling Stockholder submitted pursuant
26
hereto, shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or controlling person, or
by or on behalf of the Company or the Selling Stockholder, and shall survive
delivery of the Securities to the Underwriters.
SECTION 9. TERMINATION OF AGREEMENT.
(a) TERMINATION; GENERAL. The Representatives may terminate this
Agreement, by notice to the Company and the Selling Stockholder, at any time at
or prior to Closing Time (i) if there has been, since the time of execution of
this Agreement or since the respective dates as of which information is given in
the Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, or (ii) if there has occurred any
material adverse change in the financial markets in the United States, any
outbreak of hostilities or escalation thereof or other calamity or crisis or any
change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Representatives,
impracticable to market the Securities or to enforce contracts for the sale of
the Securities, or (iii) if trading in any securities of the Company has been
suspended or materially limited by the Commission or the New York Stock
Exchange, or if trading generally on the American Stock Exchange or the New York
Stock Exchange or in the Nasdaq National Market has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system
or by order of the Commission, the NASD or any other governmental authority, or
a material disruption has occurred in commercial banking or securities
settlement or clearance services in the United States, or (iv) if a banking
moratorium has been declared by either federal or New York authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7 and 8 shall survive such termination and remain in full force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one or more of
the Underwriters shall fail at Closing Time or a Date of Delivery to purchase
the Securities which it or they are obligated to purchase under this Agreement
(the "Defaulted Securities"), the Representatives shall have the right, within
24 hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, each of the non-defaulting
Underwriters shall be obligated, severally and not jointly, to purchase the full
amount thereof in the proportions that their respective underwriting obligations
hereunder bear to the underwriting obligations of all non-defaulting
Underwriters, or
27
(b) if the number of Defaulted Securities exceeds 10% of the number of
Securities to be purchased on such date, this Agreement or, with respect to any
Date of Delivery which occurs after the Closing Time, the obligation of the
Underwriters to purchase and of the Selling Stockholder to sell the Option
Securities to be purchased and sold on such Date of Delivery shall terminate
without liability on the part of any Selling Stockholder or any non-defaulting
Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after the Closing
Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Company to sell the relevant Option Securities,
as the case may be, either (i) the Representatives or (ii) the Company and the
Selling Stockholder shall have the right to postpone Closing Time or the
relevant Date of Delivery, as the case may be, for a period not exceeding seven
days in order to effect any required changes in either of the Registration
Statements or Prospectus or in any other documents or arrangements. As used
herein, the term "Underwriter" includes any person substituted for an
Underwriter under this Section 10.
SECTION 11. DEFAULT BY THE SELLING STOCKHOLDER OR THE COMPANY.
(a) If the Selling Stockholder shall fail at Closing Time or at a Date of
Delivery to sell and deliver the number of Securities which the Selling
Stockholder is obligated to sell hereunder, then, subject to the other
provisions of this Agreement, the Underwriters shall continue to be obligated to
purchase the Securities which the Company has agreed to sell hereunder. No
action taken pursuant to this Section 11 shall relieve the Selling Stockholder
so defaulting from liability, if any, in respect of such default.
In the event of a default by the Selling Stockholder as referred to in this
Section 11, each of the Representatives and the Company shall have the right to
postpone Closing Time or Date of Delivery for a period not exceeding seven days
in order to effect any required change in either of the Registration Statements
or Prospectus or in any other documents or arrangements.
(b) If the Company shall fail at Closing Time or at the Date of Delivery
to sell the number of Securities that it is obligated to sell hereunder, then
this Agreement shall terminate without any liability on the part of any
nondefaulting party; provided, however, that the provisions of Sections 1, 4, 6,
7 and 8 shall remain in full force and effect. No action taken pursuant to this
Section 11 shall relieve the Company from liability, if any, in respect of such
default.
SECTION 12. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives c/x Xxxxxx Brothers Inc.,
000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xx. Xxxxx Xxxxxxx; notices
to the Company shall be directed to it at 1114 Avenue of the Xxxxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: President (with a copy to 1114 Avenue of
the
00
Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: General Counsel); and
notices to the Selling Stockholder shall be directed to Starwood Capital Group,
000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000, Attn: Xx. Xxxxxx X.
Xxxxxx, with a copy to Xxxxxxx, Finkelstein & Xxxxxxxx, LLC, 000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000, Attn: Xxxxx Xxxxxxx, Esq.
SECTION 13. PARTIES. This Agreement shall each inure to the benefit of and
be binding upon the Underwriters, the Company and the Selling Stockholder and
their respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriters, the Company and the Selling Stockholder and their
respective successors and the controlling persons and officers and directors
referred to in Sections 6 and 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
Underwriters, the Company and the Selling Stockholder and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Securities from any Underwriter shall be deemed to
be a successor by reason merely of such purchase.
SECTION 14. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES
OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. EFFECT OF HEADINGS. The Article and Section headings herein are
for convenience only and shall not affect the construction hereof.
29
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company and the Selling Stockholder a counterpart
hereof, whereupon this instrument, along with all counterparts, will become a
binding agreement among the Underwriters, the Company and the Selling
Stockholder in accordance with its terms.
Very truly yours,
iSTAR FINANCIAL INC.
By:
-------------------------
Name:
Title:
SOFI-IV SMT HOLDINGS, L.L.C.
By: STARWOOD OPPORTUNITY FUND IV, L.P.,
its Sole Member and Manager
By: SOFI IV MANAGEMENT, L.L.C.,
its General Partner
By: STARWOOD CAPITAL GROUP,
L.L.C., its General Manager
By:
-------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXX BROTHERS INC.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
BANC OF AMERICA SECURITIES LLC
BEAR, XXXXXXX & CO. INC.
XXXXXXX, XXXXX & CO.
UBS WARBURG LLC
By: XXXXXX BROTHERS INC.
By:
-----------------------
Name:
Title:
For themselves and as Representatives of the other Underwriters named in
Schedule A hereto.
SCHEDULE A
Number of
Name of Underwriter Initial Securities
------------------- ------------------
Xxxxxx Brothers Inc....................................... 3,500,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ....... 2,000,000
Banc of America Securities LLC ........................... 1,125,000
Bear, Xxxxxxx & Co. Inc................................... 1,125,000
Xxxxxxx, Xxxxx & Co....................................... 1,125,000
UBS Warburg LLC .......................................... 1,125,000
----------
Total..................................................... 10,000,000
A-1
SCHEDULE B
Number of Initial Maximum Number of Option
Securities to Be Sold Securities to Be Sold
--------------------- ------------------------
iStar Financial, Inc................ 8,000,000 0
SOFI-IV SMT Holdings, L.L.C......... 2,000,000 1,500,000
---------- ---------
Total........................... 10,000,000 1,500,000
B-1
SCHEDULE C
iSTAR FINANCIAL INC.
10,000,000 Shares of Common Stock
(Par Value $.001 Per Share)
1. The public offering price per share for the Securities,
determined as provided in Section 2, shall be $26.77.
2. The purchase price per share for the Securities (other
than the Reserved Securities) to be paid by the several Underwriters
shall be $25.43, being an amount equal to the public offering price
set forth above less $1.34 per share. The purchase price per share for
the Reserved Securities to be paid by the several Underwriters shall
be the public offering price set forth above.
C-1
SCHEDULE D
SUBSIDIARIES
767 Stars, LLC
1001 East Palm LLC
7555-7575 Colshire LLC
Acquest Government Holdings, L.L.C.
Acquest Government Holdings II, LLC
Acquest Holdings FC, LLC
ACRE CLS, LLC
ACRE Dublin, LLC
ACRE HPC, LLC
ACRE IDG, LLC
ACRE IDG Manager, LLC
ACRE Partners, L.L.C.
ACRE Richfield, LLC
ACRE Seymour, LLC
ACRE Simon, L.L.C.
American Corporate Real Estate, Inc.
BM Center, LLC
Xxxxxxx Sunbelt, LLC
Corporate Technology Centre Associates, LLC
Corporate Technology Centre Associates II, LLC
CTC Associates I, L.P.
CTC Associates II, L.P.
CTC Associates I GenPar, LLC
CTC Associates II GenPar, LLC
CTL I Maryland, Inc.
FMAC StarFund, L.L.P.
F/S Subsidiary, L.L.C.
iStar Asset Receivable Trust
iStar Asset Services, Inc.
iStar Campbellsville LLC
iStar Columbus LLC
iStar CTL I, L.P
iStar CTL I GenPar, Inc.
iStar DB Seller, LLC
iStar D.C., Inc.
iStar /Denver Place, L.L.C.
iStar Eagle L.P.
iStar Eagle GenPar LLC
iStar Finance Sub V LLC
iStar Funding, LLC
iStar GT, L.P.
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iStar GT GenPar LLC
iStar Harborside LLC
iStar Harrisburg Business Trust
iStar Harrisburg L.P.
iStar Harrisburg GenPar LLC
iStar HQ GT, Inc.
iStar HQ GT Illinois, Inc.
iStar HQ I, Inc.
iStar HQ I GenPar, Inc.
iStar HQ I, L.P.
iStar HQ I Maryland, Inc.
iStar Merger Co. I
iStar Merger Co. II
iStar Poydras, LLC
iStar Preferred Holdings LLC
iStar Quincy LLC
iStar Real Estate Services, Inc.
iStar San Xxxx, LLC
iStar Spartanburg LLC
iStar Sunnyvale, LLC
iStar Sunnyvale Partners, L.P.
iStar Ventures, Inc.
iStar Ventures Direct Holdings, L.L.C.
xXxxx Xxxxxx, LLC
MD3 Cayman L.P.
NewPar, LLC
NewPar/New LLC
P Funding Inc.
Red Lion GP, Inc.
RLH Partnership, L.P.
SFI I, LLC
SFT I, Inc.
SFT II, Inc.
SFT/RLH, Inc.
SFT Starbonds Inc.
SFT Venturer, LLC
SFT Whole Loans A, Inc.
Star Liberty Funding LLC
STARS I Corp.
STARS Investment I Corp.
Starwood Operating, Inc.
STW Holdings I, Inc.
TriNet Concord Farms I Limited Partnership
TriNet Concord Farms II Limited Partnership
TriNet Concord Farms III Limited Partnership
TriNet Corporate Partners I, L.P.
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TriNet Corporate Partners II, L.P.
TriNet Corporate Partners III, L.P.
TriNet Corporate Realty Trust, Inc.
TriNet Essential Facilities I, Inc.
TriNet Essential Facilities II, Inc.
TriNet Essential Facilities III, Inc.
TriNet Essential Facilities IV, Inc.
TriNet Essential Facilities V, Inc.
TriNet Essential Facilities VI, Inc.
TriNet Essential Facilities VII, Inc.
TriNet Essential Facilities VIIIR, Inc.
TriNet Essential Facilities X, Inc.
TriNet Essential Facilities XI, Inc.
TriNet Essential Facilities XII, Inc.
TriNet Essential Facilities XIV, Inc.
TriNet Essential Facilities XV, Inc.
TriNet Essential Facilities XVI, Inc.
TriNet Essential Facilities XVIII, Inc.
TriNet Essential Facilities XIX, Inc.
TriNet Essential Facilities XX, Inc.
TriNet Essential Facilities XXI, Inc.
TriNet Essential Facilities XXII, Inc.
TriNet Essential Facilities XXIII, Inc.
TriNet Essential Facilities XXIV, Inc.
TriNet Essential Facilities XXV, Inc.
TriNet Essential Facilities XXVI, Inc.
TriNet Essential Facilities XXVII, Inc.
TriNet Essential Facilities XXVIII, Inc.
TriNet Essential Facilities XXIX, Inc.
TriNet Essential Facilities XXX, Inc.
TriNet Management Operating Company, Inc.
TriNet Milpitas Associates, LLC
TriNet Property Partners, L.P.
TriNet Realty Capital, Inc.
TriNet Realty Investors I, Inc.
TriNet Realty Investors II, Inc.
TriNet Realty Investors III, Inc.
TriNet Realty Investors IV, Inc.
TriNet Realty Investors V, Inc.
TriNet Realty Ventures, Inc.
TriNet Sunnyvale Partners, L.P.
TriNet XVII Realty Trust
W9/TriNet Poydras, LLC
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EXHIBIT A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
(i) Each of the Registration Statements is effective under the
1933 Act; any required filing of the Prospectus pursuant to Rule 424(b) has
been made in the manner and within the time period required by Rule 424(b);
and no stop order suspending the effectiveness of either of the
Registration Statements or any amendment thereto has been issued and, to
the best knowledge of such counsel, no proceedings for that purpose are
pending or threatened by the Commission.
(ii) Each of the Registration Statements and each amendment
thereto, any Rule 462(b) Registration Statement and the Prospectus (in each
case, including the documents incorporated by reference therein but not
including the financial statements and other financial information
contained therein, as to which such counsel need express no opinion) comply
as to form in all material respects with the applicable requirements of the
1933 Act, the 1934 Act, the 1933 Act Regulations and the 1934 Act
Regulations.
(iii) Such counsel has no reason to believe that (in each case,
other than the financial statements and other financial information
contained therein, as to which such counsel need express no opinion) (x)
either of the Registration Statements, as of its effective date, contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading or (y) the Prospectus, as of its date or the date of such
opinion, included or includes any untrue statement of a material fact or
omitted or omits to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(iv) The Company and each of its significant subsidiaries have
been duly organized and are validly existing as corporations in good
standing under the laws of their respective jurisdictions of incorporation
and are duly qualified to transact business as foreign corporations and are
in good standing under the laws of all other jurisdictions where such
counsel has been advised that the failure to be so qualified would amount
to a material liability or disability to the Company and its subsidiaries,
taken as a whole; the Company and each of its significant subsidiaries have
full power and authority to own, lease and operate their respective
properties and assets and conduct their respective businesses as described
in each of the Registration Statements and the Prospectus, and the Company
has corporate power to enter into the
Purchase Agreement and to carry out
all the terms and provisions hereof to be carried out by it; all of the
issued and outstanding shares of capital stock of each of the Company's
significant subsidiaries, except as otherwise set forth in the Prospectus,
are owned beneficially by the Company free and clear of any perfected
security interests or, to the best knowledge of such counsel, any
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other security interests, liens, encumbrances, equities or claims, except
for pledges of subsidiary stock under debt instruments.
(v) The statements set forth under the heading "Description of
Securities to be Registered--Common Stock" in the Base Prospectus relating
to Registration Statement No. 333-32946 and the statements set forth under
the headings "Description of Common Stock and Preferred Stock--Common
Stock" and "Description of Common Stock and Preferred Stock--Restrictions
on Ownership and Transfer" in the Base Prospectus relating to Registration
Statement No. 333-83646, insofar as such statements purport to summarize
certain provisions of the Common Stock, provide a fair summary of such
provisions; and the statements set forth under the heading "Material
Federal Income Tax Consequences" in each of the Base Prospectuses, insofar
as such statements constitute a summary of the legal matters, documents or
proceedings referred to therein, have been reviewed by such counsel and
fairly present the information called for with respect to such legal
matters, documents and proceedings in all material respects as required by
the 1933 Act, the 1934 Act, the 1933 Act Regulations and the 1934 Act
Regulations.
(vi) The execution and delivery of the
Purchase Agreement have
been duly authorized by all necessary corporate action of the Company and
the
Purchase Agreement has been duly executed and delivered by the Company.
(vii) The Securities to be purchased by the Underwriters from the
Company have been duly authorized for issuance and sale to the Underwriters
pursuant to the
Purchase Agreement and, when issued and delivered by the
Company pursuant to the
Purchase Agreement against payment of the
consideration set forth in the
Purchase Agreement, will be validly issued
and fully paid and non-assessable and no holder of the Securities is or
will be subject to personal liability by reason of being such a holder.
(viii) The Company has an authorized, issued and outstanding
capitalization as set forth in the Prospectus; the shares of issued and
outstanding capital stock of the Company, including the Securities to be
purchased by the Underwriters from the Selling Stockholder, have been duly
authorized and validly issued and are fully paid and non-assessable; and
none of the outstanding shares of capital stock of the Company was issued
in violation of the preemptive or other similar rights of any
securityholder of the Company.
(ix) The issuance and sale of the Securities by the Company and
the sale of the Securities by the Selling Stockholder is not subject to the
preemptive or other similar rights of any securityholder of the Company.
(x) The form of certificate used to evidence the Common Stock
complies in all material respects with all applicable statutory
requirements, with any applicable requirements of the charter and by-laws
of the Company and the requirements of the New York Stock Exchange.
(xi) No holder of securities of the Company has any right which
has not been fully exercised or waived to require the Company to register
the offer or sale of any
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securities owned by such holder under the 1933 Act in the offering of the
Securities contemplated by the
Purchase Agreement.
(xii) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, the
Purchase
Agreement, the compliance by the Company with the provisions of the
Purchase Agreement and the consummation of the transactions therein
contemplated do not (x) require the consent, approval, authorization,
registration or qualification of or with any governmental authority, except
such as have been obtained or made (and specified in such opinion) or such
as may be required by the securities or Blue Sky laws of the various states
of the United States of America and other U.S. jurisdictions in connection
with the offer and sale of the Securities by the Underwriters, or (y)
conflict with or result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any indenture, mortgage, deed
of trust, lease or other material agreement or instrument, known to such
counsel, to which the Company or any of its significant subsidiaries is a
party or by which the Company or any of its subsidiaries or any of their
respective properties are bound, or the charter documents or by-laws of the
Company or any of its subsidiaries, or any statute or any judgment, decree,
order, rule or regulation of any court or other governmental authority or
any arbitrator known to such counsel and applicable to the Company or its
subsidiaries.
(xiii) The Company is not an "investment company" and, after giving
effect to the offering of the Securities contemplated by the Purchase
Agreement, will not be an "investment company", as such term is defined in
the 1940 Act.
(xiv) Such counsel does not know of any legal or governmental
proceedings pending or threatened to which the Company or any of its
subsidiaries is a party or to which the property of the Company or any of
its subsidiaries is subject that are required to be described or
incorporated in either of the Registration Statements or the Prospectus and
are not described or incorporated therein or any statutes, regulations,
contracts or other documents that are required to be described or
incorporated in either of the Registration Statements or the Prospectus or
to be filed as exhibits to either of the Registration Statements that are
not described or incorporated therein or filed as required.
(xv) Commencing with the Company's taxable year ended December
31, 1998, the Company has been organized in conformity with the
requirements for qualification as a real estate investment trust ("REIT")
under the Code, and its method of operation, as described in each of the
Registration Statements and set forth in the Company's amended and restated
charter, has enabled the Company to meet and, provided that the Company
continues to meet the applicable asset composition, source of income,
shareholder diversification, distribution, record keeping and other
requirements of the Code necessary for a corporation to qualify as a REIT,
will enable it to continue to meet the requirements for qualification and
taxation as a REIT under the Code.
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deems proper, on certificates of responsible
officers of the Company and public officials and, as to matters involving the
application of laws of any jurisdiction other than the
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Xxxxx xx Xxx Xxxx xx xxx Xxxxxx Xxxxxx or the General Corporation Law of the
State of Delaware, to the extent satisfactory in form and scope to counsel for
the Underwriters, upon the opinion of Xxxxxxx Xxxxx Xxxxxxx & Xxxxxxxxx, LLP.
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EXHIBIT B
FORM OF OPINION OF COUNSEL FOR THE SELLING STOCKHOLDER
TO BE DELIVERED PURSUANT TO SECTION 5(d)
(i) SOFI-IV SMT Holdings, L.L.C. is a limited liability
company duly organized, validly existing and in good standing as a
limited liability company under the laws of the State of Delaware.
(ii) No filing with, or consent, approval, authorization,
license, order, registration, qualification or decree of, any United
States, Delaware, Connecticut or New York court or governmental
authority or agency (other than under the 1993 Act, the 1933 Act
Regulations, the 1934 Act and the 1934 Act Regulations and such
authorizations, approvals or consents as may be necessary under state
securities laws, as to which we express no opinion), is necessary or
required to be obtained by the Selling Stockholder for the performance
by the Selling Stockholder of its obligations under the Purchase
Agreement or in connection with the offer, sale or delivery of the
Securities.
(iii) The Purchase Agreement has been duly executed and
delivered by the Selling Stockholder.
(iv) The execution, delivery and performance of the Purchase
Agreement and the sale and delivery of the Securities and the
consummation of the transactions contemplated in the Purchase
Agreement and in each of the Registration Statements and compliance by
the Selling Stockholder with its obligations under the Purchase
Agreement have been duly authorized by all necessary action on the
part of the Selling Stockholder and do not, whether with or without
the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default under or result in the creation or
imposition of any tax, lien, charge or encumbrance upon the Securities
or any property or assets of the Selling Stockholder pursuant to, any
contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, license, lease or other instrument or agreement, in
each case known to such counsel (after reasonable inquiry), to which
the Selling Stockholder is a party or by which it may be bound, or to
which any of the property or assets of the Selling Stockholder may be
subject nor will such action result in any violation of the provisions
of the charter or by-laws or other organizational instrument of the
Selling Stockholder, if applicable, or any law, administrative
regulation, judgment or order of any governmental agency or body or
any administrative or court decree having jurisdiction over the
Selling Stockholder or any of its properties.
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EXHIBIT C
FORM OF OPINION OF SPECIAL COUNSEL FOR THE SELLING STOCKHOLDER
TO BE DELIVERED PURSUANT TO SECTION 5(e)
(i) Assuming that none of the Underwriters has notice of any
adverse claims with respect to the Securities then, upon delivery to
one of the Representatives of such Securities against payment therefor
indorsed to such Representative or indorsed in blank by an effective
indorsement, such Representative will acquire such Securities (and the
shares represented thereby) free of any adverse claims under Section
8-303 of the Uniform Commercial Code as in effect on the date hereof
in the State of New York (the "UCC"). As used herein, "notice of
adverse claim" has the meaning set forth in Section 8-105 of the UCC
and includes, without limitation, any adverse claims which such
Representative or any Underwriter would discover upon any
investigation which such person has a duty, imposed by statute or
regulation, to investigate.
In rendering any such opinion, such counsel may assume that the
Underwriters will have purchased the Securities for value in good faith and that
the Underwriters' rights are not limited by subsection (c) of Section 8-302 of
the UCC.
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EXHIBIT D
FORM OF LOCK-UP AGREEMENT
PURSUANT TO SECTION 5(l)
[____________], 2002
XXXXXX BROTHERS INC.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
BANC OF AMERICA SECURITIES LLC
BEAR, XXXXXXX & CO. INC.
XXXXXXX, XXXXX & CO.
UBS WARBURG LLC,
as Representatives of the several
Underwriters to be named in the
within-mentioned Purchase Agreement
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: PROPOSED PUBLIC OFFERING OF
ISTAR FINANCIAL INC. COMMON STOCK
Ladies and Gentlemen:
The undersigned, a selling stockholder of
iStar Financial Inc., a Maryland
corporation (the "Company"), understands that Xxxxxx Brothers Inc. ("Xxxxxx
Brothers"), Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, Banc of America
Securities LLC, Bear, Xxxxxxx & Co. Inc., Xxxxxxx, Xxxxx & Co., and UBS Warburg
LLC (collectively, the "Representatives") propose to enter into a Purchase
Agreement (the "Purchase Agreement") with the Company and the undersigned
providing for the public offering of shares (the "Securities") of the Company's
common stock, par value $.001 per share (the "Common Stock"). In recognition of
the benefit that such an offering will confer upon the undersigned as a selling
stockholder of the Company, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the undersigned agrees
with each underwriter to be named in the Purchase Agreement that, during a
period of 90 days from the date of the Purchase Agreement, the undersigned will
not, without the prior written consent of Xxxxxx Brothers, directly or
indirectly, (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant for the sale of, or otherwise dispose of or transfer any shares
of the Company's Common Stock or any securities convertible into or exchangeable
or exercisable for Common Stock, whether now owned or hereafter acquired by the
undersigned or with respect to which the undersigned has or hereafter acquires
the power of disposition, or file any registration statement under the
Securities Act of 1933, as amended, with respect to any of the foregoing or (ii)
enter into any swap or any other agreement or any transaction that transfers, in
whole or in part, directly or indirectly, the economic
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consequence of ownership of the Common Stock, whether any such swap or
transaction is to be settled by delivery of Common Stock or other securities, in
cash or otherwise. The foregoing sentence shall not apply to (i) the Securities
to be sold pursuant to the Purchase Agreement and (ii) any Common Stock offered
or sold by the undersigned which is included in a registered primary offering of
Common Stock by the Company. This letter shall lapse and become null and void if
the undersigned has not executed and delivered the Purchase Agreement on or
before December 1, 2002 or, if the Representatives have advised the undersigned
that a public offering of the Securities is unlikely or cannot be completed on
favorable terms, upon receipt by Xxxxxx Brothers of notice from the undersigned
directing the Representatives to terminate such public offering.
Very truly yours,
SOFI-IV SMT HOLDINGS, L.L.C.
By:
--------------------------
Name:
Title:
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