ENTERTAINMENT PROPERTIES TRUST
COMMON SHARES OF BENEFICIAL INTEREST
(PAR VALUE $.01 PER SHARE)
UNDERWRITING AGREEMENT
, 1997
Xxxxxxx, Xxxxx & Co.
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxx Xxxx LLC
Prudential Securities Incorporate
Salomon Brothers Inc
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Entertainment Properties Trust, a Maryland real estate investment trust
(the "Company"), proposes, subject to the terms and conditions stated herein,
to issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") an aggregate of 13,680,000 shares (the "Firm Shares") and, at
the election of the Underwriters, up to 2,052,000 additional shares (the
"Optional Shares") of common shares of beneficial interest, par value $.01
per share ("Stock") of the Company (the Firm Shares and the Optional Shares
that the Underwriters elect to purchase pursuant to Section 2 hereof being
collectively called the "Shares").
1. The Company and AMC Entertainment Inc., a Delaware corporation
(which, together with its wholly-owned subsidiary American Multi-Cinema,
Inc., are hereinafter referred to collectively as "AMCE"), jointly and
severally (in the case of AMCE, solely with respect to clauses (e), (n), (o),
(p) and (q) of this Section 1), represent and warrant to, and agree with,
each of the Underwriters that:
(a) A registration statement on Form S-11 (File No. 333-35281) (the
"Initial Registration Statement") in respect of the Shares has been filed
with the Securities and Exchange Commission (the "Commission"); the Initial
Registration Statement and any post-effective amendment thereto, each in the
form heretofore delivered to you, and, excluding exhibits thereto, to you for
each of the other Underwriters, have been declared effective by the
Commission in such form other than a
registration statement, if any, increasing the size of the offering (a "Rule
462(b) Registration Statement"), filed pursuant to Rule 462(b) under the
Securities Act of 1933, as amended (the "Act"), which became effective upon
filing; no other document with respect to the Initial Registration Statement
has heretofore been filed with the Commission; and no stop order suspending
the effectiveness of the Initial Registration Statement, any post-effective
amendment thereto or the Rule 462(b) Registration Statement, if any, has been
issued and no proceeding for that purpose has been initiated or threatened by
the Commission (any preliminary prospectus included in the Initial
Registration Statement or filed with the Commission pursuant to Rule 424(a)
of the rules and regulations of the Commission under the Act, is hereinafter
called a "Preliminary Prospectus"); the various parts of the Initial
Registration Statement and the Rule 462(b) Registration Statement, if any,
including all exhibits thereto and including the information contained in the
form of final prospectus filed with the Commission pursuant to Rule 424(b)
under the Act in accordance with Section 5(a) hereof and deemed by virtue of
Rule 430A under the Act to be part of the Initial Registration Statement at
the time it was declared effective or such part of the Rule 462(b)
Registration Statement, if any, at the time it became or hereafter becomes
effective, each as amended at the time such part of the registration
statement became effective, is hereinafter collectively called the
"Registration Statement"; such final prospectus, in the form first filed
pursuant to Rule 424(b) under the Act, is hereinafter called the "Prospectus";
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material respects
to the requirements of the Act and the rules and regulations of the
Commission thereunder, and did not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; PROVIDED, HOWEVER, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in writing
to the Company by an Underwriter through Xxxxxxx, Sachs & Co. expressly for
use therein;
(c) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of the
Act and the rules and regulations of the Commission thereunder and do not and
will not, as of the applicable effective date as to the Registration
Statement and any amendment thereto, and as of the applicable filing date as
to the Prospectus and any amendment or supplement thereto, contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading;
PROVIDED, HOWEVER, that this representation and warranty shall not apply to
any statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter through
Xxxxxxx, Xxxxx & Co. expressly for use therein;
(d) The Company has not sustained since the date of the latest audited
financial
statements included in the Prospectus any material loss or interference with
its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in the
Prospectus; and, since the respective dates as of which information is given
in the Registration Statement and the Prospectus, there has not been any
change in the capital stock, decline in total assets or shareholders' equity
or increase in long-term debt of the Company or any material adverse change,
or any development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position, shareholders'
equity or results of operations of the Company, otherwise than as set forth
or contemplated in the Prospectus;
(e) (i) On the First Time of Delivery (as hereinafter defined), the
Company will have good and marketable title in fee simple or valid ground
leasehold interests (under enforceable leases) to the Initial Properties (as
defined in the Prospectus) free and clear of all liens, encumbrances and
defects except such as are described in the Prospectus or such as do not
materially affect the value of such property and do not materially interfere
with the use proposed to be made of such property by the Company; (ii) all
permits which are necessary for the operation of the Initial Properties at
the First Time of Delivery (A) shall remain in full force and effect and (B)
permit the Initial Properties to be operated in material compliance with all
applicable laws, rules, codes and regulations; (iii) the operation of the
buildings, fixtures and other improvements located on the Initial Properties
as presently conducted is not in material violation of any applicable
building code, zoning ordinance or other law or regulation; (iv) neither the
Company nor, to the knowledge of the Company, AMCE or its affiliates has
received notice of any proposed special assessment or any proposed material
change in any property tax, zoning or land use laws; (v) neither the Company
nor, to the knowledge of the Company, AMCE or its affiliates has received
notice of any material violations of any declaration of covenants, conditions
and restrictions with respect to any of the Initial Properties, nor, to the
best of the Company's knowledge, is there any existing state of facts or
circumstances or condition or event which could, with the giving of notice or
passage of time, or both, constitute such a violation; and (vi) the
improvements comprising any portion of the Initial Properties (the
"Improvements") are free of undue infestation and are free of any and all
material physical, mechanical, structural, design and construction defects;
the Improvements (including, without limitation, all water, electric, sewer,
plumbing, heating, ventilating, gas and air conditioning servicing the
Improvements) are in good condition and proper working order and are free of
material defects, except, in the case of paragraphs (ii) through (vi) hereof,
as disclosed in the Operative Documents (as hereinafter defined) or except as
is not material in the aggregate to the Company;
(f) The Company has been duly incorporated and is validly existing as a
real estate investment trust in good standing under the laws of the State of
Maryland, with trust power and authority to own its properties and conduct
its business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such qualification, or
is subject to no material liability or disability by
reason of the failure to be so qualified in any such jurisdiction; and the
Company does not have a direct or indirect ownership interest in any
corporation, joint venture, partnership or other entity;
(g) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued, are fully paid and
non-assessable and conform to the description of the Stock contained in the
Prospectus;
(h) The unissued Shares to be issued and sold by the Company to the
Underwriters hereunder have been duly and validly authorized and, when issued
and delivered against payment therefor as provided herein, will be duly and
validly issued and fully paid and non-assessable and will conform to the
description thereof contained in the Prospectus;
(i) The issue and sale of the Shares by the Company and the compliance
by the Company with all of the provisions of this Agreement and the
consummation of the transactions herein contemplated will not conflict with
or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any material indenture, mortgage, deed of trust,
loan agreement, lease or other agreement or instrument to which the Company
is a party or by which the Company is bound or to which any of the property
or assets of the Company is subject, nor will such action result in any
violation of the provisions of the Declaration of Trust or By-laws of the
Company or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of
its properties; and no consent, approval, authorization, order, registration
or qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Shares or the consummation by the
Company of the transactions contemplated by this Agreement, except the
registration under the Act of the Shares and such consents, approvals,
authorizations, registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters and such additional steps as
may be required by the National Association of Securities Dealers, Inc. (the
"NASD");
(j) The Company is not in violation of its Declaration of Trust or
By-laws or in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which it is a party or by which it or any of its properties may
be bound;
(k) The statements set forth in the Prospectus under the caption
"Description of Shares of Beneficial Interest", insofar as they purport to
constitute a summary of the terms of the Stock, under the caption "Federal
Income Tax Consequences", and under the caption "Underwriting", insofar as
they purport to describe the provisions of the laws and documents referred to
therein, are accurate, complete and fair in all material respects;
(l) Other than as set forth in the Prospectus, there are no legal or
governmental
proceedings pending to which the Company is a party or of which any property
of the Company is the subject which, if determined adversely to the Company,
would individually or in the aggregate prevent or materially hinder the
consummation of this Agreement or the Operative Documents or have a material
adverse effect on the consolidated financial position, shareholders' equity
or results of operations of the Company; and, to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by governmental
authorities or threatened by others;
(m) The Company is not and, after giving effect to the offering and
sale of the Shares, will not be an "investment company" or an entity
"controlled" by an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act");
(n) Ernst & Young LLP, who have certified certain financial statements
of the Company, and Coopers & Xxxxxxx LLP, who have certified certain
financial statements of AMCE, are each independent public accountants as
required by the Act and the rules and regulations of the Commission
thereunder;
(o) At the First Time of Delivery, each of the Purchase Agreement, the
Option Agreements, the AMCE Right to Purchase Agreement and the Leases (each
as defined in the Prospectus) will have been duly and validly authorized,
executed and delivered by the Company and will be valid and binding
agreements of the Company enforceable in accordance with their respective
terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating
to or affecting creditors' rights and to general equity principles. At the
First Time of Delivery, the agreements described in Section 5(e) pursuant to
which the Company and certain persons have agreed not to sell their Shares
for a specified period of time (the "Lockup Agreements"), assuming they have
been duly and validly authorized, executed and delivered by the parties
thereto, will be valid and binding agreements, enforceable in accordance with
their terms. The Purchase Agreement, the Option Agreements, the AMCE Right
to Purchase Agreement, the Leases and the Lockup Agreements are sometimes
hereinafter called the "Operative Documents." The execution, delivery and
performance of the Operative Documents and the consummation of the
transactions contemplated therein and compliance by the Company with its
obligations thereunder have been duly authorized by all necessary corporate
action and will not contravene any provision of applicable law or the
Declaration of Trust or By-laws of the Company or any agreement or other
instrument binding upon the Company, or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company, and
no consent, approval, authorization or order of or qualification with any
governmental body or agency is required for the performance by the Company of
its obligations under the Operative Documents, except (i) such as may be
required by the federal securities laws or the securities or Blue Sky laws of
the various states in connection with the offer and sale of the Shares and
(ii) to the extent that the failure to obtain such would not, individually or
in the aggregate, have a material adverse effect on the Company;
(p) The historical and pro forma financial statements, together with
the related schedules and notes, of the Company and AMCE, included in the
Registration Statement and the Prospectus, conform to the requirements of the
Act and the rules and regulations promulgated thereunder; such historical
financial statements fairly present the financial position of the Company and
AMCE at the respective dates indicated in accordance with generally accepted
accounting principles applied on a consistent basis for the periods
indicated; such pro forma financial statements have been prepared on a basis
consistent with such historical statements, except for the pro forma
adjustments specified therein, and give effect to assumptions made on a
reasonable basis and present fairly the transactions reflected thereby as
indicated in the Prospectus; and the financial and statistical data set forth
in the Prospectus fairly presents the information set forth therein on the
basis stated in the Prospectus;
(q) Except as disclosed in environmental studies and impact studies
provided to the Company as part of the Due Diligence Materials (as defined in
the Purchase Agreement), the Company has no knowledge of (i) the presence of
any hazardous substances, hazardous materials, toxic substances or waste
materials (collectively, "Hazardous Materials") on any of the properties
owned by it in violation of law or in excess of regulatory action levels or
(ii) any unlawful spills, releases, discharges or disposal of Hazardous
Materials that have occurred or are presently occurring on or off such
properties as a result of any construction on or operation and use of such
properties, which presence or occurrence would materially adversely affect
the consolidated financial position, shareholders' equity or results of
operations of the Company; and in connection with the construction on or
operation and use of the properties owned by the Company, it has received no
notice of any material failure to comply with all applicable local, state and
federal environmental laws, regulations, agency requirements, ordinances and
administrative and judicial orders;
(r) At the First Time of Delivery, the Company will be organized in
conformity with the requirements for qualification as a real estate
investment trust under Sections 856 through 860 of the Internal Revenue Code
of 1986, as amended (the "Code"), and its proposed method of operation as
described in the Registration Statement will enable it to meet the
requirements for taxation as a real estate investment trust under the Code
for the taxable period commencing with the year ending December 31, 1997;
(s) The Company has obtained title insurance on all of the Initial
Properties and such title insurance is in full force and effect; and
(t) Neither the Company, nor any of its trustees, officers or
controlling persons, has taken or will take, directly or indirectly, any
action resulting in a violation of Regulation M under the Exchange Act of
1934, as amended (the "Exchange Act"), or designed to cause or result under
the Exchange Act or otherwise in, or which has constituted or which
reasonably might be expected to constitute, the stabilization or manipulation
of the price of any securities of the Company or facilitation of the sale of
the Shares.
2. Subject to the terms and conditions herein set forth, (a) the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company,
at a purchase price per share of $................, the number of Firm Shares
set forth opposite the name of such Underwriter in Schedule I hereto and (b)
in the event and to the extent that the Underwriters shall exercise the
election to purchase Optional Shares as provided below, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Company, at the
purchase price per share set forth in clause (a) of this Section 2, that
portion of the number of Optional Shares as to which such election shall have
been exercised (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying such number of Optional Shares by a fraction, the
numerator of which is the maximum number of Optional Shares which such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
number of Optional Shares that all of the Underwriters are entitled to
purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase
at their election up to 2,052,000 Optional Shares, at the purchase price per
share set forth in the paragraph above, for the sole purpose of covering
overallotments in the sale of the Firm Shares. Any such election to purchase
Optional Shares may be exercised only once by written notice from you to the
Company, given within a period of 30 calendar days after the date of this
Agreement, setting forth the aggregate number of Optional Shares to be
purchased and the date on which such Optional Shares are to be delivered, as
determined by you but in no event earlier than the First Time of Delivery (as
defined in Section 4 hereof) or, unless you and the Company otherwise agree
in writing, earlier than two or later than ten business days after the date
of such notice.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
4. (a) Certificates in definitive form for the Shares to be purchased
by each Underwriter hereunder, in such authorized denominations and
registered in such names as Xxxxxxx, Sachs & Co. may request upon at least
forty-eight hours' prior notice to the Company shall be delivered by or on
behalf of the Company to Xxxxxxx, Xxxxx & Co., for the account of such
Underwriter, against payment by or on behalf of such Underwriter of the
purchase price therefor by wire transfer of immediately available funds to an
account designated by the Company. The Company will cause the certificates
representing the Shares to be made available for checking and packaging at
least twenty-four hours prior to the Time of Delivery (as defined below) with
respect thereto at the office of Xxxxxxx, Sachs & Co., 00 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 (the "Designated Office"). The time and date of such
delivery and payment shall be, with respect to the Firm Shares, 9:30 a.m.,
New York City time, on ............., 1997 or such other time and date as
Xxxxxxx, Xxxxx & Co. and the Company may agree upon in writing, and,
with respect to the Optional Shares, 9:30 a.m., New York time, on the date
specified by Xxxxxxx, Sachs & Co. in the written notice given by Xxxxxxx,
Xxxxx & Co. of the Underwriters' election to purchase such Optional Shares,
or such other time and date as Xxxxxxx, Sachs & Co. and the Company may agree
upon in writing. Such time and date for delivery of the Firm Shares is herein
called the "First Time of Delivery", such time and date for delivery of the
Optional Shares, if not the First Time of Delivery, is herein called the
"Second Time of Delivery", and each such time and date for delivery is herein
called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on
behalf of the parties hereto pursuant to Section 7 hereof, including the
cross receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7(l) hereof, will be delivered at the
offices of Xxxxxxx & Xxxx X.X., 0000 Xxxxx Xxxx., Xxxxxx Xxxx, Xxxxxxxx 00000
(the "Closing Location"), and the Shares will be delivered at the Designated
Office, all at such Time of Delivery. A meeting will be held at the Closing
Location at .......p.m., Kansas City time, on the New York Business Day next
preceding such Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be
available for review by the parties hereto. For the purposes of this Section
4, "New York Business Day" shall mean each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking institutions in New
York are generally authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file
such Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier
time as may be required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or Prospectus which
shall be disapproved by you promptly after reasonable notice thereof; to
advise you, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes effective
or any supplement to the Prospectus or any amended Prospectus has been filed
and to furnish you with copies thereof; to advise you, promptly after it
receives notice thereof, of the issuance by the Commission of any stop order
or of any order preventing or suspending the use of any Preliminary
Prospectus or prospectus, of the suspension of the qualification of the
Shares for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the issuance
of any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or prospectus or suspending any such qualification,
promptly to use its best efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as you may
reasonably
request to qualify the Shares for offering and sale under the securities laws
of such jurisdictions as you may request and to comply with such laws so as
to permit the continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of the Shares,
provided that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus in such
quantities as you may from time to time reasonably request, and, if the
delivery of a prospectus is required at any time prior to the expiration of
nine months after the time of issue of the Prospectus in connection with the
offering or sale of the Shares and if at such time any event shall have
occurred as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made when such Prospectus is
delivered, not misleading, or, if for any other reason it shall be necessary
during such period to amend or supplement the Prospectus in order to comply
with the Act, to notify you and upon your request to prepare and furnish
without charge to each Underwriter and to any dealer in securities as many
copies as you may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance, and in case any Underwriter
is required to deliver a prospectus in connection with sales of any of the
Shares at any time nine months or more after the time of issue of the
Prospectus, upon your request but at the expense of such Underwriter, to
prepare and deliver to such Underwriter as many copies as you may request of
an amended or supplemented Prospectus complying with Section 10(a)(3) of the
Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c) under
the Act), an earnings statement of the Company (which need not be audited)
complying with Section 11(a) of the Act and the rules and regulations
thereunder (including, at the option of the Company, Rule 158);
(e) During the period beginning from the date hereof and continuing to
and including the date 180 days after the date of the Prospectus (and the
Company has provided agreements executed by each of its executive officers
and trustees providing that for a period of 180 days after the date of the
Prospectus such executive officers and trustees agree), not to offer, sell,
contract to sell or otherwise dispose of, except as provided hereunder, any
securities of the Company that are substantially similar to the Shares,
including but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Stock or any such
substantially similar securities (other than, in the case of the Company,
pursuant to compensation programs existing on, or upon the conversion or
exchange of convertible or exchangeable securities outstanding as of, the
date of this Agreement), without your prior written consent; and the Company
has entered into agreements with each of the Company's executive officers and
trustees providing that for a period of two years after the date of the
Prospectus, they
will not offer, sell, contract to sell or otherwise dispose of any securities
of the Company that are substantially similar to the Shares, including but
not limited to any securities that are convertible into or exchangeable for,
or that represent the right to receive, Stock or any such substantially
similar securities without the Company's prior written consent;
(f) To furnish to its shareholders as soon as practicable after the end
of each fiscal year an annual report (including a balance sheet and
statements of income, shareholders' equity and cash flows of the Company and
its consolidated subsidiaries certified by independent public accountants)
and, as soon as practicable after the end of each of the first three quarters
of each fiscal year (beginning with the fiscal quarter ending after the
effective date of the Registration Statement), consolidated summary financial
information of the Company for such quarter in reasonable detail;
(g) During a period of five years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to shareholders, and to deliver
to you (i) as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the Company is
listed; and (ii) such additional publicly available information concerning
the business and financial condition of the Company as you may from time to
time reasonably request (such financial statements to be on a consolidated
basis to the extent the accounts of the Company and its subsidiaries are
consolidated in reports furnished to its shareholders generally or to the
Commission);
(h) To use the net proceeds received by it from the sale of the Shares
pursuant to this Agreement in the manner specified in the Prospectus under
the caption "Use of Proceeds";
(i) To use its best efforts to list, subject to notice of issuance, the
Shares on the New York Stock Exchange;
(j) To file with the Commission such reports on Form SR as may be
required by Rule 463 under the Act;
(k) Neither the Company nor any of its officers, trustees or affiliates
will take, directly or indirectly, any action resulting in a violation of
Regulation M under the Exchange Act, or designed to cause or result in, or
which might constitute or be expected to constitute, stabilization or
manipulation of the price of the Shares;
(l) The Company will use its best efforts to meet the requirements to
qualify, effective for the taxable period commencing with the year ending
December 31, 1997 and in each year thereafter, as a real estate investment
trust under the Code;
(m) Subject to the terms thereof, the Company will do and perform its
obligations under each of the Operative Documents to which it is a party to
the extent required to consummate the transactions set forth therein and all
things required to be done or performed prior to the First Time of Delivery
pursuant to this Agreement; and
(n) Not to be or become, at any time prior to the expiration of three
years after the last Time of Delivery, an "investment company" or an entity
"controlled" by and "investment company", as such terms are defined in the
Investment Company Act.
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or
producing any Agreement among Underwriters, Underwriters' Questionnaires,
Underwriters' Powers of Attorney, Selected Dealer Agreements, this Agreement,
the Blue Sky Memorandum, closing documents (including any compilations
thereof) and any other documents in connection with the offering, purchase,
sale and delivery of the Shares; (iii) all expenses in connection with the
qualification of the Shares for offering and sale under state securities laws
as provided in Section 5(b) hereof, including the reasonable fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky survey; (iv) all fees and
expenses in connection with listing the Shares on the New York Stock
Exchange; (v) the filing fees incident to, and the fees and disbursements of
counsel for the Underwriters in connection with, securing any required review
by the NASD of the terms of the sale of the Shares; (vi) the cost of
preparing stock certificates; (vii) the cost and charges of any transfer
agent or registrar; and (viii) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section. It is understood, however, that, except as
provided in this Section, and Sections 8 and 11 hereof, the Underwriters will
pay all of their own costs and expenses, including the fees of their counsel,
stock transfer taxes on resale of any of the Shares by them, and any
advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters hereunder, as to the Shares to
be delivered at each Time of Delivery, shall be subject, in their discretion,
to the condition that all representations and warranties and other statements
of the Company and AMCE herein are, at and as of such Time of Delivery, true
and correct, the condition that the Company shall have performed all of its
obligations hereunder theretofore to be performed, and the following
additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing
by the rules and regulations under the Act and in accordance with Section
5(a) hereof; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; all requests for additional information on the part of the
Commission shall have been complied with to your reasonable satisfaction; and
the NASD, upon review of the terms of the public offering of the Shares,
shall not have objected to such offering, such terms or the Underwriters'
participation in the same;
(b) Xxxxxxx Xxxx & Xxxxxxxxx, counsel for the Underwriters, shall have
furnished to you such opinion or opinions, dated such Time of Delivery, with
respect to the Shares, the Registration Statement, the Prospectus and such
other related matters as you may reasonably request, and such counsel shall
have received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(c) Xxxxxxxx & Xxxxxxxx, counsel for the Company, shall have furnished
to you their written opinion, dated such Time of Delivery, in form and
substance satisfactory to you, to the effect that:
(i) The Company has been duly formed and is an existing real
estate investment trust in good standing under the laws of the State of
Maryland, with the trust power to own its properties and conduct its
business as described in the Prospectus.
(ii) The Company has an authorized capitalization as set forth in
the Prospectus. All of the Company's outstanding shares of Stock,
including the Shares being delivered at such Time of Delivery, have been
duly authorized and validly issued and are fully paid and nonassessable.
(iii) The Company has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the laws of
the State of California.
(iv) This Agreement has been duly authorized, executed and
delivered by the Company.
(v) The issuance of the Shares and the sale of the Shares by the
Company to the Underwriters pursuant to this Agreement do not, and the
performance by the Company of its obligations under this Agreement and the
Operative Documents will not, (i) violate the Declaration of Trust or
By-laws of the Company, (ii) result in a default under or breach of the
agreements identified to such counsel as listed in the Officers'
Certificate of the Company dated as the date of this opinion (a copy of
which certificate is attached as an exhibit to such opinion) or
(iii) violate any Federal law of the United States or law of the States
of New York or California applicable to the Company; PROVIDED THAT such
counsel need not express any opinion with respect to Federal or state
securities laws, other than anti-fraud laws, fraudulent transfer laws and
antitrust laws, and insofar as performance by the Company of its
obligations under this Agreement and the Operative Documents is
concerned, such counsel need not express any opinion as to bankruptcy,
insolvency, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights.
(vi) All regulatory consents, authorizations, approvals and filings
required to be obtained or made by the Company under the Federal laws of
the United States and the laws of the State of New York for the issuance,
sale and delivery of the Shares by the Company to the Underwriters and the
performance by the Company of its obligations under the Operative Documents
have been obtained or made.
(vii) The Company has all requisite power to execute and deliver
each of the Operative Documents to which it is a party and each of the
Operative Documents to which it is a party has been duly authorized,
executed and delivered by the Company.
(viii) The Company is not an "investment company" as that term is
defined in the Investment Company Act.
In addition, you shall have received from Xxxxxxxx & Xxxxxxxx a letter
stating that as counsel to the Company, they reviewed the Registration
Statement and the Prospectus, participated in discussions with your
representatives and those of the Company, AMCE and their respective
accountants, and advised the Company as to the requirements of the Act and
the applicable rules and regulations thereunder; on the basis of the
information that such counsel gained in the course of the performance of such
services, considered in the light of their understanding of the applicable
law (including the requirements of Form S-11 and the character of the
prospectus contemplated thereby) and the experience they have gained through
their practice under the Act, they confirm to you that, in their opinion, the
Registration Statement and the Prospectus, as of the effective date of the
Registration Statement, appeared on their face to be appropriately responsive
in all material respects to the requirements of the Act and the applicable
rules and regulations of the Commission thereunder; nothing that came to such
counsel's attention in the course of such review has caused such counsel to
believe that the Registration Statement or the Prospectus (other than
information relating to AMCE), as of such effective date, contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading; nothing that has come to such counsel's attention in the course
of the limited procedures described in such letter has caused them to believe
that the Prospectus (other than information relating to AMCE), as of the date
and time of delivery of such letter, contained any untrue statement of a
material fact or omitted to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading, and such counsel do not know of any
litigation or any governmental proceeding instituted or threatened against
the Company that would be required to be disclosed in the Prospectus and is
not so disclosed, and do not know of any documents that are required to be
filed as exhibits to the Registration Statement and are not so filed or of
any documents that are required to be summarized
in the Prospectus and are not so summarized. Such counsel may state that the
limitations inherent in the independent verification of factual matters and
the character of determinations involved in the registration process are such
that they do not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement or the
Prospectus except for those made under the caption "Description of Shares of
Beneficial Interest" insofar as they relate to terms of the Shares therein
described, the caption "Federal Income Tax Consequences" insofar as they
relate to provisions of the Federal income tax laws and the caption
"Underwriting" insofar as they relate to provisions of this Agreement; and
that such counsel do not express any opinion or belief as to the financial
statements or other financial data contained in the Registration Statement or
the Prospectus.
Xxxxxxxx & Xxxxxxxx may rely on Ballard, Spahr, Xxxxxxx & Ingersoll as
to matters of Maryland law.
(d) Xxxxxxx & Xxxx, counsel for AMCE, shall have furnished you a letter
stating that as counsel for AMCE, they reviewed the Registration Statement
and the Prospectus, and participated in discussions with your representatives
and those of AMCE, the Company and their respective accountants; on the basis
of the information that such counsel gained in the course of the performance
of such services, considered in the light of their understanding of the
applicable law and the experience they have gained through their practice
under the Act, they confirm to you that nothing that came to such counsel's
attention in the course of such review has caused such counsel to believe
that information relating to AMCE in the Registration Statement or the
Prospectus, as of such effective date, contained any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not misleading; and
nothing that has come to such counsel's attention in the course of the
limited procedures described in such letter has caused them to believe that
information relating to AMCE in the Prospectus, as of the date and time of
delivery of such letter, contained any untrue statement of a material fact or
omitted 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. Such counsel may state that the limitations inherent in the
independent verification of factual matters and the character of
determinations involved in the registration process are such that they do not
assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus and that
such counsel do not express any opinion or belief as to the financial
statements or other financial data contained in the Registration Statement or
the Prospectus.
(e) Xxxxxxxx & Xxxxxxxx, tax counsel for the Company, shall have
furnished to you such opinion or opinions, dated such Time of Delivery, in
form and substance acceptable to you, to the effect that, upon completion of
the Formation Transactions (as defined in the Prospectus), the Company will
be organized in conformity with the requirements for qualification as a real
estate investment trust under the Code, and the proposed method of operation
of the Company, as described in the Registration Statement and the Prospectus
and a certificate of a responsible officer of the Company, will enable the
Company to meet the requirements for taxation as a real
estate investment trust under the Code beginning with the year ending
December 31, 1997.
(f) Ballard, Spahr, Xxxxxxx & Ingersoll, special Maryland counsel for
the Company, shall have furnished to you such opinion or opinions, dated such
Time of Delivery, in form and substance acceptable to you, to the effect that:
(i) The Company has been duly formed and is validly existing as a
real estate investment trust in good standing under the laws of the State
of Maryland, with trust power to own its properties and conduct its
business substantially as described under the heading "The Company" in
the Prospectus;
(ii) The form of share certificate to be used to evidence the
Shares will be in due and proper form and will comply with all applicable
legal requirements of Title 8 of the Corporations and Associations Article
of the Annotated Code of Maryland ("Title 8") under the Maryland General
Corporation Law; and
(iii) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of Stock of the Company
(including the Shares being delivered at such Time of Delivery) have been
duly authorized and validly issued and are fully paid and nonassessable;
the Shares conform in all material respects to the description thereof
contained under the heading "Description of Shares of Beneficial Interest"
in the Prospectus; and no preemptive rights of stockholders exist in
Title 8 with respect to any of the Shares or the issue and sale or
distribution thereof.
(g) On the date of the Prospectus at a time prior to the execution of
this Agreement, at 9:30 a.m., New York City time, on the effective date of
any post-effective amendment to the Registration Statement filed subsequent
to the date of this Agreement and also at each Time of Delivery, Ernst &
Young LLP and Coopers & Xxxxxxx LLP shall have each furnished to you letters,
dated the respective dates of delivery thereof, in form and substance
satisfactory to you, to the effect set forth in Annex I hereto;
(h) (i) The Company shall not have sustained since the date of the
latest audited financial statements included in the Prospectus any loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus, and (ii) since the respective dates as of
which information is given in the Prospectus there shall not have been any
change in the capital stock, decline in total assets or shareholders' equity
or increase in long-term debt of the Company or any change, or any
development involving a prospective change, in or affecting the general
affairs, management, financial position, shareholders' equity or results of
operations of the Company, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in Clause (i) or
(ii), is in the judgment of the representatives so material and adverse as to
make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares being delivered at such Time of Delivery on the terms
and in the manner contemplated in the Prospectus;
(i) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange; (ii) a suspension or
material limitation in trading in the Company's securities on the New York
Stock Exchange; (iii) a general moratorium on commercial banking activities
declared by either Federal, New York or Missouri state authorities; or (iv)
the outbreak or escalation of hostilities involving the United States or the
declaration by the United States of a national emergency or war, if the
effect of any such event specified in this Clause (iv) in the judgment of the
Representatives makes it impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares being delivered at such Time of
Delivery on the terms and in the manner contemplated in the Prospectus;
(j) The Shares to be sold at such Time of Delivery shall have been duly
listed, subject to notice of issuance, on the New York Stock Exchange;
(k) The Company has obtained and delivered to the Underwriters executed
copies of the Lock-Up Agreements from each of the Company's executive
officers and trustees, substantially to the effect set forth in Subsection
5(e) hereof in form and substance satisfactory to you;
(l) The Company shall have furnished or caused to be furnished to you
at such Time of Delivery certificates of officers of the Company satisfactory
to you as to the accuracy of the representations and warranties of the
Company herein at and as of such Time of Delivery, as to the performance by
the Company of all of its obligations hereunder to be performed at or prior
to such Time of Delivery, as to the matters set forth in subsections (a) and
(h) of this Section and as to such other matters as you may reasonably
request; and
(m) The Formation Transactions shall have been effected in accordance
with all the terms and conditions set forth in the Operative Documents,
subject only to the transfer of funds related thereto, or shall occur
simultaneously with the purchase and sale of the Firm Shares hereunder.
8. (a) The Company and AMCE will, jointly and severally, indemnify and
hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, the Registration Statement or the Prospectus, or
any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such action or claim as such expenses are incurred; PROVIDED,
HOWEVER, that neither the Company nor AMCE shall be liable in any such case
to the extent that any such loss, claim, damage or liability arises out of or
is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, the Registration
Statement or the Prospectus or any such amendment or supplement in reliance
upon and in conformity with written information furnished to the Company by
any Underwriter through Xxxxxxx, Sachs & Co. expressly for use therein;
PROVIDED, FURTHER, that neither the Company nor AMCE will be liable to any
Underwriter or any person controlling any Underwriter with respect to any
such untrue statement or omission made in any Preliminary Prospectus that is
corrected in the Prospectus (or any amendment or supplement thereto) if the
person alleging any such loss, claim, damage or liability purchased
Securities from such Underwriter but was not sent or given a copy of the
Prospectus (as amended or supplemented), at or prior to the written
confirmation of the sale of such Securities to such person in any case where
such delivery of the Prospectus (as amended or supplemented) is required by
the Act and the untrue statement or alleged untrue statement of a material
fact, or the omission or alleged omission to state a material fact, that is
found to be or is alleged to be the basis of liability in such Preliminary
Prospectus was corrected in the Prospectus as amended or supplemented and if
such Underwriter would not have been liable had a copy of such Prospectus
been so sent or given unless such failure to deliver the Prospectus (as
amended or supplemented) was a result of the Company's failure to comply with
Section 5(c) of this Agreement.
(b) Each Underwriter will indemnify and hold harmless the Company and
AMCE against any losses, claims, damages or liabilities to which the Company
may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of
or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or any amendment or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in any Preliminary Prospectus, the
Registration Statement or the Prospectus or any such amendment or supplement
in reliance upon and in conformity with written information furnished to the
Company by such Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use
therein; and will reimburse the Company and AMCE for any legal or other
expenses reasonably incurred by the Company in connection with investigating
or defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have
to any indemnified party otherwise than under such subsection. In case any
such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
shall wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel satisfactory to such indemnified
party (who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and, after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified party
under such subsection for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party, in
connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of
the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action
or claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential
party to such action or claim) unless such settlement, compromise or judgment
(i) includes an unconditional release of the indemnified party from all
liability arising out of such action 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.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to
reflect the relative benefits received by the Company and AMCE on the one
hand and the Underwriters on the other from the offering of the Shares. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party
shall contribute to such amount paid or payable by such indemnified party in
such proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the Company and AMCE on the one hand and the
Underwriters on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations.
The relative benefits received by the Company and AMCE on the one hand and
the Underwriters on the other shall be deemed to be in the same proportion as
the total net proceeds from the offering (before deducting expenses) received
by the Company bear to the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table on the
cover page of the Prospectus. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company or AMCE on the
one hand or the Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company, AMCE and the Underwriters agree that it
would not be just and equitable if contributions pursuant to this subsection
(d) 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 subsection (d). The amount paid or payable by an indemnified party
as a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall
be required to contribute any amount in excess of the amount by which the
total price at which the Shares 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 such untrue
or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations
in this subsection (d) to contribute are several in proportion to their
respective underwriting obligations and not joint.
(e) The obligations of the Company and AMCE under this Section 8 shall
be in addition to any liability which the Company and AMCE may otherwise have
and shall extend, upon the same terms and conditions, to each person, if any,
who controls any Underwriter within the meaning of the Act; and the
obligations of the Underwriters under this Section 8 shall be in addition to
any liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of
the Company and AMCE (including any person who, with his or her consent, is
named in the Registration Statement as about to become a director of the
Company) and to each person, if any, who controls the Company within the
meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder at a Time of Delivery,
you may in your discretion arrange for you or another party or other parties
to purchase such Shares on the terms contained herein. If within thirty-six
hours after such default by any Underwriter you do not arrange for the
purchase of such Shares, then the Company shall be entitled to a further
period of thirty-six hours within which to procure another party or other
parties satisfactory to you to purchase such Shares on such terms. In the
event that, within the respective prescribed periods, you notify the Company
that you have so arranged for the purchase of such Shares, or the Company
notifies you that it has so arranged for the purchase of such Shares, you or
the Company shall have the right to postpone such Time of Delivery for a
period of not more than seven days, in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the Prospectus, or
in any other documents or arrangements, and the Company agrees to file
promptly any amendments to the Registration Statement or the Prospectus which
in your opinion may thereby be made necessary. The term "Underwriter" as used
in this Agreement shall include any person substituted under this Section
with like effect as if such person had originally been a party to this
Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased does not exceed one-eleventh of the aggregate number of
all the Shares to be purchased at such Time of Delivery, then the Company
shall have the right to require each non-defaulting Underwriter to purchase
the number of shares which such Underwriter agreed to purchase hereunder at
such Time of Delivery and, in addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based on the number of Shares
which such Underwriter agreed to purchase hereunder) of the Shares of such
defaulting Underwriter or Underwriters for which such arrangements have not
been made; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased exceeds one-eleventh of the aggregate number of all the
Shares to be purchased at such Time of Delivery, or if the Company shall not
exercise the right described in subsection (b) above to require
non-defaulting Underwriters to purchase Shares of a defaulting Underwriter or
Underwriters, then this Agreement (or, with respect to the Second Time of
Delivery, the obligations of the Underwriters to purchase and of the Company
to sell the Optional Shares) shall thereupon terminate, without liability on
the part of any non-defaulting Underwriter or the Company, except for the
expenses to be borne by the Company and the Underwriters as provided in
Section 6 hereof and the indemnity and contribution agreements in Section 8
hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, AMCE and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless
of any investigation (or any statement as to the results thereof) made by or
on behalf of any Underwriter or any controlling person of any Underwriter, or
the Company, or any officer or director or controlling person of the Company,
or AMCE, or any officer or director or controlling person of AMCE, and shall
survive delivery of and payment for the Shares.
Anything herein to the contrary notwithstanding, the indemnity
agreements of the Company and AMCE in subsection (a) of Section 8 hereof, the
representations and warranties in subsections (b) and (c) of Section 1 hereof
and any representation or warranty as to the accuracy of the Registration
Statement or the Prospectus contained in any certificate furnished by the
Company pursuant to Section 7 hereof, insofar as they may constitute a basis
for indemnification for liabilities (other than payment by the Company of
expenses incurred or paid in the successful defense of any action, suit or
proceeding) arising under the Act, shall not extend to the extent of any
interest therein of a controlling person or partner of an Underwriter who is
a director, officer or controlling person of the Company or AMCE when the
Registration Statement has become effective or who, with his or her consent,
is named in the Registration Statement as about to become a director of the
Company, except in each case to the extent that an interest of such character
shall have been determined by a court of appropriate jurisdiction as not
against public policy as expressed in the Act. Unless in the opinion of
counsel for the Company or AMCE, as the case may be, the matter has been
settled by controlling precedent, the Company or AMCE, as the case may be,
will, if a claim for such indemnification is asserted, submit to a court of
appropriate jurisdiction the question of whether such interest is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company shall not then be under any liability to any Underwriter except
as provided in Sections 6 and 8 hereof; but, if for any other reason, any
Shares are not delivered by or on behalf of the Company as provided herein,
the Company will reimburse the Underwriters through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for
the purchase, sale and delivery of the Shares not so delivered, but the
Company shall then be under no further liability to any Underwriter except as
provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon
any statement, request, notice or agreement on behalf of any Underwriter made
or given by you jointly or by Xxxxxxx, Xxxxx & Co. on behalf of you as the
representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex
or facsimile transmission to you as the representatives in care of Xxxxxxx,
Sachs & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Registration Department; if to the Company shall be delivered or sent by mail
to the address of the Company set forth in the Registration Statement,
Attention: Secretary; and if to AMCE to 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx,
Xxxxxxxx 00000, Attention: Secretary; PROVIDED, HOWEVER, that any notice to
an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by you upon
request. Any such statements, requests, notices or agreements shall take
effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company, AMCE and, to the extent provided
in Sections 8 and 10 hereof, the officers and directors of the Company and
AMCE and each person who controls the Company, AMCE or any Underwriter, and
their respective heirs, t executors, administrators, successors and assigns,
and no other person shall acquire or have any right under or by virtue of
this Agreement. No purchaser of any of the Shares from any Underwriter shall
be deemed a successor or assign by reason merely of such purchase.
14. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the
same instrument.
If the foregoing is in accordance with your understanding, please sign
and return to us one for the Company and each of the representatives plus one
for each counsel counterparts hereof, and upon the acceptance hereof by you,
on behalf of each of the Underwriters, this letter and such acceptance hereof
shall constitute a binding agreement between each of the Underwriters and the
Company. It is understood that your acceptance of this letter on behalf of
each of the Underwriters is pursuant to the authority set forth in a form of
Agreement among Underwriters, the form of which shall be submitted to the
Company for examination upon request, but without warranty on your part as to
the authority of the signers thereof.
Very truly yours,
ENTERTAINMENT PROPERTIES TRUST:
By: _______________________________
Name:
Title:
AMC ENTERTAINMENT, INC.
By: _______________________________
Name:
Title:
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxx Xxxx LLC
Prudential Securities Incorporated
Salomon Brothers, Inc
By: _________________________________
Xxxxxxx, Xxxxx & Co.
On behalf of each of the Underwriters
SCHEDULE I
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM SHARES MAXIMUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
----------- --------------- -------------------
Xxxxxxx, Sachs & Co.
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxx Xxxx LLC
Prudential Securities Incorporated
Salomon Brothers Inc
--------------- -------------------
Total: 13,680,000 2,052,000
--------------- -------------------
--------------- -------------------
ANNEX I
Pursuant to Section 7(d) of the Underwriting Agreement, the
accountants shall furnish letters to the Underwriters to the effect
that:
(i) They are independent certified public accountants with respect
to the Company or AMCE and its subsidiaries, as applicable, within the
meaning of the Act and the applicable published rules and regulations
thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included in the Prospectus or the Registration Statement comply
as to form in all material respects with the applicable accounting
requirements of the Act and the related published rules and regulations
thereunder; and, if applicable, they have made a review in accordance
with standards established by the American Institute of Certified Public
Accountants of the unaudited consolidated interim financial statements,
selected financial data, pro forma financial information, financial
forecasts and/or condensed financial statements derived from audited
financial statements of the Company or AMCE, as applicable, for the
periods specified in such letter, as indicated in their reports thereon,
copies of which have been separately furnished to the representatives of
the Underwriters (the "Representatives");
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the unaudited condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows included in the
Prospectus as indicated in their reports thereon copies of which have
been separately furnished to the Representatives and on the basis of
specified procedures including inquiries of officials of the Company or
AMCE, as applicable, who have responsibility for financial and
accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i)
below comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published rules and
regulations, nothing came to their attention that cause them to believe
that the unaudited condensed consolidated financial statements do not
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published rules and
regulations;
(iv) The unaudited selected financial information with respect to
the consolidated results of operations and financial position of AMCE
for the five most recent fiscal years included in the Prospectus agrees
with the corresponding amounts (after restatements where applicable) in
the audited consolidated financial statements for such five fiscal years
which were included or incorporated by reference in AMCE's Annual
Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and
on the basis of limited procedures specified in such letter nothing came
to their attention as a result of the foregoing procedures that caused
them to believe that this information does not conform in all material
respects with the disclosure requirements of Items 301, 302, 402 and
503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company or AMCE and its subsidiaries, as
applicable, inspection of the minute books of the Company or AMCE and
its subsidiaries, as applicable, since the date of the latest audited
financial statements included in the Prospectus, inquiries of officials
of the Company or AMCE and its subsidiaries, as applicable, responsible
for financial and accounting matters and such other inquiries and
procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) (i) the unaudited consolidated statements of income,
consolidated balance sheets and consolidated statements of cash
flows included in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the
Act and the related published rules and regulations, or (ii) any
material modifications should be made to the unaudited condensed
consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the Prospectus for
them to be in conformity with generally accepted accounting
principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with
the basis for the corresponding amounts in the audited consolidated
financial statements included in the Prospectus;
(C) the unaudited financial statements which were not included in
the Prospectus but from which were derived any unaudited condensed
financial statements referred to in Clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the audited
consolidated financial statements included in the Prospectus;
(D) any unaudited pro forma consolidated condensed financial
statements included in the Prospectus do not comply as to form in
all material respects with the applicable accounting requirements of
the Act and the published rules and regulations thereunder or the
pro forma adjustments have not been properly applied to the
historical amounts in the compilation of those statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise
of options and stock appreciation rights, upon earn-outs of
performance shares and upon conversions of convertible securities,
in each case which were outstanding on the date of the latest
financial statements included in the Prospectus) or any increase in
the consolidated long-term debt of the Company or AMCE and its
subsidiaries, as applicable, or any decreases in consolidated net
current assets or stockholders' equity or other items specified by
the Representatives, or any increases in any items specified by the
Representatives, in each case as compared with amounts shown in the
latest balance sheet included in the Prospectus, except in each case
for changes, increases or decreases which the Prospectus discloses
have occurred or may occur or which are described in such letter; and
(F) for the period from the date of the latest financial
statements included in the Prospectus to the specified date referred
to in Clause (E) there were any decreases in consolidated net
revenues or operating profit or the total or per share amounts of
consolidated net income or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period
of the preceding year and with any other period of corresponding
length specified by the Representatives, except in each case for
decreases or increases which the Prospectus discloses have occurred
or may occur or which are described in such letter; and
(vii) In addition to the examination referred to in their report(s)
included in the Prospectus and the limited procedures, inspection of minute
books, inquiries and other procedures referred to in paragraphs (iii) and
(vi) above, they have carried out certain specified procedures, not
constituting an examination in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and financial
information specified by the Representatives, which are derived from the
general accounting records of the Company or AMCE and its subsidiaries, as
applicable, which appear in the Prospectus, or in Part II of, or in exhibits
and schedules to, the Registration Statement specified by the
Representatives, and have compared certain of such amounts, percentages and
financial information with the accounting records of the Company or AMCE and
its subsidiaries, as applicable, and have found them to be in agreement.
