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EXHIBIT 1.1
3,700,000 Shares
BRANDYWINE REALTY TRUST
Common Shares of Beneficial Interest
UNDERWRITING AGREEMENT
, 1996
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
As Representatives of the Several Underwriters
c/o XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Brandywine Realty Trust, a Maryland real estate investment trust (the
"Company"), proposes to issue and sell an aggregate of 3,700,000 shares (the
"Firm Shares") of its common shares, $0.01 par value per share (the "Common
Shares"), to you and to the other several Underwriters named in Schedule I
hereto (collectively, the "Underwriters") for whom you are acting as
representatives (the "Representatives"). The Company also proposes to sell to
the Underwriters, upon the terms and conditions set forth in Section 3 hereof,
up to an additional 555,000 Common Shares (the "Additional Shares"). The Firm
Shares and the Additional Shares are hereinafter collectively referred to as the
"Shares."
The Company and Brandywine Operating Partnership, L.P., a Delaware
limited partnership of which the Company is the sole General Partner (the
"Operating Partnership"), wish to confirm as follows their agreement with you
and the other several Underwriters on whose behalf you are acting, in connection
with the several purchases of the Shares by the Underwriters.
1. Registration Statement and Prospectus. The Company has prepared and
filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"Act"), a registration statement on Form S-11 (No. 333-13969) under the Act (the
"Initial Registration Statement"), including a prospectus subject to completion
relating to the Shares.
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The term "Registration Statement" as used in this Agreement means the Initial
Registration Statement (including all financial schedules and exhibits), as
amended at the time it becomes effective, and any registration statement filed
with the Commission pursuant to Rule 462(b) under the Act (the "Rule 462(b)
Registration Statement") or, if the Initial Registration Statement became
effective prior to the execution of this Agreement, as supplemented or amended
prior to the execution of this Agreement. If it is contemplated, at the time
this Agreement is executed, that a post-effective amendment to the Initial
Registration Statement or Rule 462(b) Registration Statement will be filed and
must be declared effective before the offering of the Shares may commence, the
term "Registration Statement" as used in this Agreement means the Initial
Registration Statement or Rule 462(b) Registration Statement as amended by said
post-effective amendment. The term "Prospectus" as used in this Agreement means
(X) if the Company relies on Rule 434 under the Act, the Term Sheet (as defined
below) relating to the Shares that is first filed pursuant to Rule 424(b)(7)
under the Act together with the Prepricing Prospectus (as defined below)
identified therein that such term sheet supplements, or (Y) if the Company does
not rely on Rule 434 under the Act, the prospectus in the form included in the
Registration Statement, or, if the prospectus included in the Registration
Statement omits information in reliance on Rule 430A under the Act and such
information is included in a prospectus filed with the Commission pursuant to
Rule 424(b) under the Act, the term "Prospectus" as used in this Agreement means
the prospectus in the form included in the Registration Statement as
supplemented by the addition of the Rule 430A information contained in the
prospectus filed with the Commission pursuant to Rule 424(b). The term
"Prepricing Prospectus" as used in this Agreement means the prospectus subject
to completion in the form included in the Initial Registration Statement at the
time of the initial filing of such registration statement with the Commission,
and as such prospectus shall have been amended from time to time prior to the
date of the Prospectus. The term "Term Sheet" means any term sheet that
satisfies the requirements of Rules 434 and 424(b) under the Act. Any reference
to the "date" of a Prospectus that includes a Term Sheet means the date of such
Term Sheet. Capitalized terms used, but not defined, herein shall have the
respective meanings ascribed thereto in the Prospectus.
2. Property Acquisitions. (a) Prior to the offering and sale of the Firm
Shares to the Underwriters, the Company, the Operating Partnership, Safeguard
Scientifics, Inc. ("SSI"), The Xxxxxxx Company ("TNC"), certain entities and
persons affiliated with SSI and/or TNC, and certain unaffiliated entities and
persons entered into and consummated a series of transactions collectively
described in the Prospectus, and referred to herein, as the "SSI/TNC
Transaction." The documents executed and delivered in connection with the
consummation of the SSI/TNC Transaction, including, without limitation, the
documents listed on Schedule 2(a) attached hereto, are hereinafter referred to
as the "SSI/TNC Documents."
(b) Following consummation of the SSI/TNC Transaction, the
Company owned interests in 23 suburban office buildings and one industrial
facility (which are collectively referred to in the Prospectus as the "Initial
Properties") as follows: (i) the Company owned one office property, (ii) the
Operating Partnership owned six office properties, (iii) Brandywine Realty
Partners, a Pennsylvania general partnership and a Subsidiary (as defined in
Section 2(h) below), owned 3 office properties and one industrial facility, and
(iv) [12] Subsidiary limited partnerships in which the Company and/or the
Operating Partnership own a controlling interest owned 13 office properties
(collectively, the "Initial Properties").
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(c) In addition to the SSI/TNC Transaction, [prior] to the
offering and sale of the Firm Shares to the Underwriters, the Company, RAI Real
Estate Advisors Inc. ("RAI"), as voting trustee of a voting trust dated
________, 1996 (the "SERS Voting Trust") executed by the Commonwealth of
Pennsylvania State Employees' Retirement System ("SERS") as shareholder and by
RAI as voting trustee, and certain affiliates of SERS, entered into and
consummated a series of transactions collectively described in the Prospectus,
and referred to herein, as the "SERS Transaction." In addition, pursuant to a
Securities Purchase Agreement, dated November__, 1996 between the Company and
RAI, as voting trustee, the SERS Voting Trust agreed to purchase, on the Closing
Date, Common Shares directly from the Company in a private placement at a price
per share equal to the Price to Public set forth on the cover page of the
Prospectus for an aggregate purchase price of $10,500,000. Such transaction is
described in the Prospectus, and is referred to herein, as the "SERS Private
Placement." The documents executed and delivered in connection with the
consummation of the SERS Transaction, including, without limitation, the
documents listed on Schedule 2(c)(1) attached hereto, are hereinafter referred
to as the "SERS Transaction Documents," and the documents executed and
delivered, and to be executed and delivered, in connection with the consummation
of the SERS Private Placement, including, without limitation, the documents
listed on Schedule 2(c)(2) attached hereto, are hereinafter referred to as the
"SERS Investment Documents," and together with the SERS Transaction Documents,
the "SERS Documents."
(d) Following consummation of the SERS Transaction, the
Company owned eight office properties and one industrial property (collectively,
the "SERS Properties") in addition to the Initial Properties.
(e) Pursuant to a [purchase agreement], dated November__, 1996
between the Company and [the Xxxxxx Xxxxxxx Funds] (together, the "Xxxxxx
Xxxxxxx Funds"), the Xxxxxx Xxxxxxx Funds agreed to purchase, on the Closing
Date, Common Shares directly from the Company in a private placement at a price
per share equal to $5.50 per share for an aggregate purchase price of
$15,000,000. Such a transaction is described in the Prospectus, and is referred
to herein, as the "Xxxxxx Xxxxxxx Private Placement." The documents executed and
delivered, and to be executed and delivered, in connection with the consummation
of the Xxxxxx Xxxxxxx Private Placement, including, without limitation, the
documents listed on Schedule 2(e) attached hereto, are hereinafter referred to
as the "Xxxxxx Xxxxxxx Investment Documents."
(f) In addition to the SSI/TNC Transaction and the SERS
Transaction, the Company and [certain unaffiliated third parties] have entered
into purchase agreements with respect to certain proposed transactions
collectively described in the Prospectus under the caption "The Company-Other
Pending Acquisitions", and referred to herein as the "Other Acquisition
Transactions," and together with the SSI/TNC Transaction, the SERS Transaction,
the SERS Private Placement, and the Xxxxxx Xxxxxxx Private Placement, the
"Transactions." The documents executed and delivered in connection with the
consummation of the Other Acquisition Transactions, including, without
limitation, the documents listed on Schedule 2(f) attached hereto, are
hereinafter referred to as the "Other Acquisition Documents," and, together with
the SSI/TNC Documents, the SERS Documents, and the Xxxxxx Xxxxxxx Investment
Documents, the "Transaction Documents."
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(g) Following consummation of the Other Acquisitions, the
Company will own four office properties (the "Other Acquisition Properties") in
addition to the Initial Properties and the SERS Properties. The Initial
Properties, the SERS Properties, and the Other Properties are herein
collectively referred to as the "Properties."
(h) For purposes of this Agreement, each of the Operating
Partnership and the corporations, partnerships and limited partnerships listed
on Schedule 2(h) attached hereto is deemed to be a "Subsidiary" of the Company.
3. Agreements to Sell and Purchase. The Company hereby agrees, subject
to all the terms and conditions set forth herein, to issue and sell to each
Underwriter and, upon the basis of the representations, warranties and
agreements of the Company and the Operating Partnership herein contained and
subject to all the terms and conditions set forth herein, each Underwriter
agrees, severally and not jointly, to purchase from the Company, at a purchase
price of $_.__ per Share (the "purchase price per share"), the number of Firm
Shares set forth opposite the name of such Underwriter in Schedule I hereto (or
such number of Firm Shares increased as set forth in Section 11 hereof).
The Company also agrees, subject to all the terms and conditions set
forth herein, to sell to the Underwriters, and, upon the basis of the
representations, warranties and agreements of the Company and the Operating
Partnership herein contained and subject to all the terms and conditions set
forth herein, the Underwriters shall have the right to purchase from the
Company, at the purchase price per share, pursuant to an option (the
"over-allotment option") which may be exercised at any time and from time to
time prior to 9:00 P.M., New York City time, on the 30th day after the date of
the Prospectus (or, if such 30th day shall be a Saturday or Sunday or a holiday,
on the next business day thereafter when the American Stock Exchange is open for
trading), up to an aggregate of 555,000 Additional Shares. Additional Shares may
be purchased only for the purpose of covering over-allotments made in connection
with the offering of the Firm Shares. Upon any exercise of the over-allotment
option, each Underwriter, severally and not jointly, agrees to purchase from the
Company the number of Additional Shares (subject to such adjustments as you may
determine in order to avoid fractional shares) which bears the same proportion
to the number of Additional Shares to be purchased by the Underwriters as the
number of Firm Shares set forth opposite the name of such Underwriter in
Schedule I hereto (or such number of Firm Shares increased as set forth in
Section 11 hereof) bears to the aggregate number of Firm Shares.
4. Terms of Public Offering. The Company has been advised by you that
the Underwriters propose to make a public offering of their respective portions
of the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable and initially to offer the
Shares upon the terms set forth in the Prospectus.
5. Delivery of the Shares and Payment Therefor. Delivery to the
Underwriters of and payment for the Firm Shares shall be made at the office of
Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX 00000, at 10:00 A.M., New
York City time, on , 1996 (the "Closing Date"). The place of closing
for the Firm Shares and the Closing Date may be varied by agreement between
you and the Company.
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Delivery to the Underwriters of and payment for any Additional Shares to
be purchased by the Underwriters shall be made at the aforementioned office of
Xxxxx Xxxxxx Inc. at such time on such date (the "Option Closing Date"), which
may be the same as the Closing Date but shall in no event be earlier than the
Closing Date nor earlier than two nor later than ten business days after the
giving of the notice hereinafter referred to, as shall be specified in a written
notice from you on behalf of the Underwriters to the Company of the
Underwriters' determination to purchase a number, specified in such notice, of
Additional Shares. The place of closing for any Additional Shares and the Option
Closing Date for such Shares may be varied by agreement between you and the
Company.
Certificates for the Firm Shares and for any Additional Shares to be
purchased hereunder shall be registered in such names and in such denominations
as you shall request prior to 9:30 A.M., New York City time, on the second
business day preceding the Closing Date or any Option Closing Date, as the case
may be. Such certificates shall be made available to you in New York City for
inspection and packaging not later than 9:30 A.M., New York City time, on the
business day next preceding the Closing Date or the Option Closing Date, as the
case may be. The certificates evidencing the Firm Shares and any Additional
Shares to be purchased hereunder shall be delivered to you on the Closing Date
or the Option Closing Date, as the case may be, against payment of the purchase
price therefor by wire transfer of immediately available funds to the Company.
6. Agreements of the Company and the Operating Partnership. The Company
and the Operating Partnership jointly and severally agree with the several
Underwriters as follows:
(a) If, at the time this Agreement is executed and delivered,
it is necessary for the Registration Statement or a post-effective amendment
thereto to be declared effective before the offering of the Shares may commence,
the Company will endeavor to cause the Registration Statement or such
post-effective amendment to become effective as soon as possible and will advise
you promptly and, if requested by you, will confirm such advice in writing, when
the Registration Statement or such post-effective amendment has become
effective.
(b) The Company will advise you promptly and, if requested by
you, will confirm such advice in writing: (i) of any request by the Commission
for amendment of or a supplement to the Initial Registration Statement, any Rule
462(b) Registration Statement, any Prepricing Prospectus or the Prospectus or
for additional information; (ii) of the issuance by the Commission of any stop
order suspending the effectiveness of the Initial Registration Statement or any
Rule 462(b) Registration Statement or of the suspension of qualification of the
Shares for offering or sale in any jurisdiction or the initiation of any
proceeding for such purpose; and (iii) within the period of time referred to in
paragraph (h) below, of any change in the Company's condition (financial or
other), business, prospects, properties, net worth or results of operations, or
of the happening of any event, which makes any statement of a material fact made
in the Registration Statement or the Prospectus (as then amended or
supplemented) untrue or which requires the making of any additions to or changes
in the Registration Statement or the Prospectus (as then amended or
supplemented) in order to state a material fact required by the Act or the
regulations thereunder to be stated therein or necessary in order to make the
statements therein not misleading, or of the necessity to amend or supplement
the Prospectus (as then amended or supplemented) to comply with the Act or any
other
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law. If at any time the Commission shall issue any stop order suspending the
effectiveness of the Registration Statement, the Company will make every
reasonable effort to obtain the withdrawal of such order at the earliest
possible time.
(c) The Company will furnish to you, without charge, three
signed copies of the Initial Registration Statement and of each amendment
thereto, including financial statements and all exhibits thereto, and any Rule
462(b) Registration Statement and will also furnish to you, without charge, such
number of conformed copies of the Initial Registration Statement and of each
amendment thereto, but without exhibits, and any Rule 462(b) Registration
Statement as you may request.
(d) The Company will not (i) file any amendment to the Initial
Registration Statement or any Rule 462(b) Registration Statement or make any
amendment or supplement to the Prospectus or the Term Sheet of which you shall
not previously have been advised or to which you shall object after being so
advised or (ii) so long as, in the opinion of counsel for the Underwriters, a
prospectus is required to be delivered in connection with sales by any
Underwriter or dealer, file any information, documents or reports pursuant to
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), without
delivering a copy of such information, documents or reports to you, as
Representatives of the Underwriters, prior to or concurrently with such filing.
(e) Prior to the execution and delivery of this Agreement, the
Company has delivered to you, without charge, in such quantities as you have
requested, copies of each form of the Prepricing Prospectus. The Company
consents to the use, in accordance with the provisions of the Act and with the
securities or Blue Sky or real estate syndication laws of the jurisdictions in
which the Shares are offered by the several Underwriters and by dealers, prior
to the date of the Prospectus, of each Prepricing Prospectus so furnished by the
Company.
(f) As soon after the execution and delivery of this Agreement
as possible and thereafter from time to time for such period as in the opinion
of counsel for the Underwriters a prospectus is required by the Act to be
delivered in connection with sales by any Underwriter or dealer, the Company
will expeditiously deliver to each Underwriter and each dealer, without charge,
as many copies of the Prospectus (and of any amendment or supplement thereto) as
you may request. The Company consents to the use of the Prospectus (and of any
amendment or supplement thereto) in accordance with the provisions of the Act
and with the securities or Blue Sky or real estate syndication laws of the
jurisdictions in which the Shares are offered by the several Underwriters and by
all dealers to whom Shares may be sold, both in connection with the offering and
sale of the Shares and for such period of time thereafter as the Prospectus is
required by the Act to be delivered in connection with sales by any Underwriter
or dealer. If during such period of time any event shall occur that in the
judgment of the Company or in the opinion of counsel for the Underwriters is
required to be set forth in the Prospectus (as then amended or supplemented) or
should be set forth therein in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or if it
is necessary to supplement or amend the Prospectus to comply with the Act or any
other law, the Company will forthwith prepare and, subject to the provisions of
paragraph (d) above, file with the Commission an appropriate supplement or
amendment thereto, and will expeditiously furnish to the Underwriters and
dealers a reasonable number of copies thereof.
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In the event that the Company and you, as Representatives of the several
Underwriters, agree that the Prospectus should be amended or supplemented, the
Company, if requested by you, will promptly issue a press release announcing or
disclosing the matters to be covered by the proposed amendment or supplement.
(g) The Company will cooperate with you and with counsel for
the Underwriters in connection with the registration or qualification of the
Shares for offering and sale by the several Underwriters and by dealers under
the securities or Blue Sky or real estate syndication laws of such jurisdictions
as you may designate and will file such consents to service of process or other
documents necessary or appropriate in order to effect such registration or
qualification; provided that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so qualified or
to take any action which would subject it to service of process in suits, other
than those arising out of the offering or sale of the Shares, in any
jurisdiction where it is not now so subject.
(h) The Company will make generally available to its security
holders a consolidated earnings statement, which need not be audited, covering a
twelve-month period commencing after the effective date of the Registration
Statement and ending not later than 15 months thereafter, as soon as practicable
after the end of such period, which consolidated earnings statement shall
satisfy the provisions of Section 11(a) of the Act.
(i) During the period of five years hereafter, the Company
will furnish to you (i) as soon as available, a copy of each report of the
Company mailed to stockholders or filed with the Commission, and (ii) from time
to time such other information concerning the Company as you may reasonably
request.
(j) If this Agreement shall terminate or shall be terminated
after execution pursuant to any provisions hereof (otherwise than pursuant to
the second paragraph of Section 11 hereof or by notice given by you terminating
this Agreement pursuant to Section 11 or Section 11 hereof) or if this Agreement
shall be terminated by the Underwriters because of any failure or refusal on the
part of the Company to comply with the terms or fulfill any of the conditions of
this Agreement, the Company agrees to reimburse the Representatives for all
out-of-pocket expenses (including fees and expenses of counsel for the
Underwriters) incurred by you in connection herewith.
(k) The Company will apply the net proceeds from the sale of
the Shares in accordance with the description set forth in the Prospectus.
(l) If Rule 430A of the Act is employed, the Company will
timely file with the Commission the Prospectus pursuant to Rule 424(b) under the
Act and will advise you of the time and manner of such filing.
(m) If Rule 434 of the Act is employed, the Company will
timely file with the Commission a Term Sheet relating to the Shares, which shall
identify the Prepricing Prospectus that
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it supplements, containing such information as is required or permitted by Rules
434, 430A and 424(b) under the Act.
(n) If Rule 462(b) of the Act is employed, the Company shall
both file a Rule 462(b) Registration Statement with the Commission in compliance
with Rule 462(b) and pay the applicable fees in accordance with Rule 111
promulgated under the Act by the earlier of (i) 10:00 p.m. New York city time on
the date of this Agreement and (ii) the time confirmations are sent or given, as
specified by Rule 462(b)(2).
(o) Except as provided in this Agreement, neither the Company
nor the Operating Partnership will sell, offer to sell, solicit an offer to buy,
contract to sell or otherwise transfer or dispose of any Common Shares or any
securities convertible into or exercisable or exchangeable for Common Shares
(whether through the issuance or granting of any options, warrants, commitments,
subscriptions, rights to purchase or otherwise) for a period of 180 days after
the date of the Prospectus, without the prior written consent of Xxxxx Xxxxxx
Inc.; provided, however, that the foregoing shall not prohibit (i) the Company
or the Operating Partnership from issuing Common Shares, limited partner
interests in the Operating Partnership ("Units"), or other securities
exchangeable for Common Shares that are issued in connection with the
acquisition of any office or industrial property, or (ii) the Company from
issuing Common Shares upon the redemption of any Units issued in connection with
SSI/TNC Transaction as described in the Prospectus.
(p) The Company has furnished or will furnish to you "lock-up"
letters, in form and substance satisfactory to you, signed by each of its
current officers and trustees, five percent or greater shareholders, certain of
their respective affiliates, and certain other shareholders designated by you,
each of whom is identified on Schedule 6(p) hereto.
(q) Except as stated in this Agreement and in the Prepricing
Prospectus and Prospectus, the Company has not taken, nor will it take, directly
or indirectly, any action designed to or that might reasonably be expected to
cause or result in stabilization or manipulation of the price of the Common
Shares to facilitate the sale or resale of the Shares.
(r) The Company will use its best efforts to have the Shares
listed, subject to notice of issuance, on the American Stock Exchange
concurrently with the effectiveness of the Registration Statement.
(s) The Company and the Operating Partnership in good faith
will enforce the terms of each of the Transaction Documents.
7. Representations and Warranties of the Company. The Company and the
Operating Partnership, jointly and severally, represent and warrant to each
Underwriter that:
(a) Each Prepricing Prospectus included as part of the
registration statement as originally filed or as part of any amendment or
supplement thereto, or filed pursuant to Rule 424 under the Act, complied when
so filed in all material respects with the provisions of the Act. The Commission
has not issued any order preventing or suspending the use of any Prepricing
Prospectus.
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No stop order suspending the effectiveness of the Registration Statement or any
part thereof has been issued and no proceeding for that purpose has been
instituted or threatened by
the Commission or the securities authority of any state or other
jurisdiction.
(b) The Registration Statement in the form in which it became
or becomes effective and also in such form as it may be when any post-effective
amendment thereto shall become effective, complied or will comply in all
material respects with the provisions of the Act and did not or will not at any
such times 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, and the Prospectus or any Term Sheet that is a part
thereof and any supplement or amendment thereto when filed with the Commission
under Rule 424(b) or Rule 434 under the Act, complied or will comply in all
material respects with the provisions of the Act and did not or will not at any
such times 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 light of the circumstances under which they were made, not
misleading, except that this representation and warranty does not apply to
statements in or omissions from the registration statement or the Prospectus
made in reliance upon and in conformity with information relating to any
Underwriter furnished to the Company in writing by or on behalf of any
Underwriter through you expressly for use therein, which information is
described in its entirety in Section 13 below.
(c) The Company is duly formed and validly existing as a real
estate investment trust in good standing under the laws of the State of
Maryland, with full trust power and authority to own, lease, and operate its
properties, and to conduct its business as described in the Registration
Statement and the Prospectus, and is duly registered and qualified to conduct
its business and is in good standing in each jurisdiction or place where the
nature of its properties or the conduct of its business requires such
registration or qualification.
(d) Each of the Subsidiaries is a corporation, limited
partnership, or general partnership duly incorporated or formed, as the case may
be, validly existing and in good standing under the laws of its jurisdiction of
incorporation or formation. Each such entity has full corporate or partnership
power and authority, to own, lease, and operate its properties, and to conduct
its business as described in the Registration Statement and the Prospectus. Each
such Subsidiary is duly registered and qualified to conduct its business and is
in good standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such registration or
qualification.
(e) All the outstanding Common Shares of the Company have been
duly authorized and validly issued, are fully paid and nonassessable and are
free of any preemptive or similar rights; the Shares have been duly authorized
and, when issued and delivered to the Underwriters against payment therefor in
accordance with the terms hereof, will be validly issued, fully paid and
nonassessable and free of any preemptive or similar rights that entitle or will
entitle any person or entity to acquire any Shares upon the issuance thereof by
the Company, and the capital stock of the Company conforms to the description
thereof in the Registration Statement and the Prospectus. Except as disclosed in
the Prospectus, there are no outstanding options, warrants or other rights
calling for the issuance of, or any commitment, plan or arrangement to issue,
any capital
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stock of the Company or any security convertible into or exchangeable for
capital stock of the Company. As of the Closing Date, the Company will have
reserved a sufficient number of Common Shares for issuance upon (i) exercise of
the redemption of _____ outstanding Units held by certain investors who acquired
(or, as disclosed in the Prospectus, will acquire on or prior to _____________,
1997) outstanding Units in connection with the SSI/TNC Transaction, (ii) the
exercise of options for up to __________ Common Shares issued under the
Company's stock option plan, (iii) the exercise of warrants for up to __________
Common Shares and (iv) the conversion of Preferred Shares into up to 1,606,060
Common Shares.
(f) All of the outstanding Units of the Operating Partnership,
and shares of capital stock or partnership interests in each of the Subsidiaries
have been duly authorized and validly issued or created under the agreements
forming such entity, are fully paid and, in the case of Subsidiaries that are
corporations, nonassessable, and will be owned or be held by the persons and
entities in the percentage amounts set forth and in the manner described in the
Prospectus. Except as described in the Prospectus, all such Units, partnership
interests and shares of capital stock are owned by the Company directly, or
indirectly through the Operating Partnership or one of the other Subsidiaries,
free and clear of any lien, adverse claim, security interest, equity, or other
encumbrance, and the Company's percentage interest and ownership in the
Operating Partnership, and the Company's and the Operating Partnership's
percentage interest and ownership in each of the Subsidiaries, is as set forth
on Schedule 7(f) attached hereto. Except as described in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), there are
no outstanding options, warrants or other rights calling for the issuance of, or
any commitment, plan or arrangement to issue, any equity interests in any
Subsidiary, or any security convertible into, or exchangeable or exercisable or,
any such interests in any such Subsidiary. The terms of the Units conform in all
material to statements and descriptions thereof contained in the Prospectus. The
Company is the sole general partner of the Operating Partnership.
(g) The Company has no direct or indirect subsidiaries other
than the Subsidiaries. Other than the Subsidiaries, neither the Company nor the
Operating Partnership owns, directly or indirectly, securities of any
corporation, partnership, joint venture, limited liability company, association
or other business association.
(h) There are no actions, suits, proceedings pending or, to
the knowledge of the Company or the Operating Partnership, threatened against or
affecting the Company or any of the Subsidiaries, or any of their respective
partners, directors, trustees or officers in their capacity as such, or to which
the Company or any of the Subsidiaries or any of their respective partners,
directors, trustees or officers in their capacity as such, or to which any of
their respective properties is subject, that are required to be described in the
Registration Statement or the Prospectus but are not described as required, and
there are no agreements, contracts, indentures, leases or other instruments that
are required to be described in the Registration Statement or the Prospectus or
to be filed as an exhibit to the Registration Statement that are not described
or filed as required by the Act.
(i) Neither the Company nor any of the Subsidiaries is in
violation of its Declaration of Trust, certificate or articles of incorporation
or by-laws, partnership agreement or
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other organizational documents, or of any law, ordinance, administrative or
governmental rule or regulation applicable to the Company or any of the
Subsidiaries or of any decree of any court or governmental agency or body having
jurisdiction over the Company or any of the Subsidiaries, or in default in any
material respect in the performance of any obligation, agreement or condition
contained in any bond, debenture, note or any other evidence of indebtedness or
in any agreement, indenture, lease or other instrument to which the Company or
any of the Subsidiaries is a party or by which any of them or any of their
respective properties may be bound.
(j) Neither the issuance and offer, and sale or delivery of
the Shares, the execution, delivery or performance of this Agreement or the
Transaction Documents, nor the consummation of the transactions contemplated
hereby or thereby by the Company or any Subsidiary, as applicable, (A) required
or requires any consent, approval, authorization or other order of or
registration or filing with, any court, regulatory body, administrative agency
or other governmental body, agency or official (except such as may be required
for the registration of the Shares under the Act and compliance with the
securities or Blue Sky laws of various jurisdictions, all of which have been or
will be effected in accordance with this Agreement), (ii) conflicted with,
conflicts or will conflict with or constituted, constitutes or will constitute a
breach of, or a default under, the Declaration of Trust, certificate or articles
of incorporation or bylaws, partnership agreement or other organizational
documents, of the Company or any of the Subsidiaries or under, any agreement,
indenture, lease or other instrument to which the Company or any of the
Subsidiaries is a party or by which any of them or any of their respective
properties may be bound, (iii) violated, violates or will violate any statute,
law, regulation or filing or judgment, injunction, order or decree applicable to
the Company or any of the Subsidiaries or any of their respective properties, or
(iv) resulted or will result in the creation or imposition of any lien, charge
or encumbrance upon any property or assets of the Company or any of the
Subsidiaries pursuant to the terms of any agreement or instrument to which any
of them is a party or by which any of them may be bound or to which any of the
property or assets of any of them is subject.
(k) All offers and sales of Units or other partnership
interests in the Operating Partnership, and the offer, sale or issuance by the
Company of Common Shares prior to the date hereof have been duly registered
under the Act, or were exempt from the registration requirements of the Act and
state securities and Blue Sky laws. The offer, sale and issuance by the Company
of Common Shares pursuant to each of the Xxxxxx Xxxxxxx Private Placement and
the SERS Private Placement, and the offer, sale and issuance by the Company of
Preferred Shares in and pursuant to the SERS Private Placement, in each case,
were exempt from the registration requirements of the Act and state securities
and Blue Sky laws.
(l) The accountants, Xxxxxx Xxxxxxxx LLP, who have audited the
financial statements included in the Registration Statement and the Prospectus
(and any amendment or supplement thereto), are independent public accountants as
required by the Act.
(m) The financial statements, together with related schedules
and notes, included in the Registration Statement and the Prospectus (and any
amendment or supplement thereto), present fairly the consolidated financial
position, results of operations and changes in cash flows of the respective
entity, entities, property, or properties, as applicable, at the respective
dates or for the
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respective periods to which they apply; such statements and related schedules
and notes have been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved, and comply with
the applicable accounting requirements of the Act (including, without
limitation, Rule 3-14 of Regulation S-X promulgated by the Commission). The
other financial and statistical information and data included in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto) are accurately presented and prepared on a basis consistent with such
financial statements and the books and records of the relevant entity, entities,
property or properties, as applicable; the pro forma financial statements of the
Company included in the Registration Statement and the Prospectus comply in all
material respects with the applicable requirements of Rule 11-02 of Regulation
S-X of the Commission, and the pro forma adjustments have been made upon
management's reasonable good faith estimates of the pro forma adjustments and
have been properly applied to the historical amounts in the compilation of such
statements.
(n) The Company has all trust power and authority, and the
Operating Partnership has all partnership power and authority, to enter into
this Agreement and each Transaction Document to which it is a party, and, in the
case of the Company, to issue, sell and deliver the Shares to the Underwriters
as provided in the Underwriting Agreement, and each of the Underwriting
Agreement and each Transaction Document has been duly and validly authorized,
executed and delivered by the Company and the Operating Partnership, as
applicable, and, to the knowledge of the Company, each of the other parties
thereto, and is a valid, legal and binding agreement of each of the Company and
the Operating Partnership, as applicable, enforceable against each of the
Company and the Operating Partnership in accordance with its terms, except as
enforcement of rights to indemnity and contribution hereunder may be limited by
Federal or state securities laws or principles of public policy and subject to
the qualification that the enforceability of the Company's obligations hereunder
may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors' rights generally
and by general equitable principles.
(o) Each Subsidiary has all corporate or partnership power and
authority, as the case may be, to enter into each Transaction Document to which
it is a party, and each Transaction Document has been duly and validly
authorized, executed and delivered by each Subsidiary party thereto and is a
valid, legal and binding agreement of each such Subsidiary, enforceable against
such Subsidiary in accordance with its terms, except as enforcement of rights to
indemnity and contribution hereunder may be limited by Federal or state
securities laws or principles of public policy and subject to the qualification
that the enforceability of each such Subsidiary's obligations thereunder may be
limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors' rights generally
and by general equitable principles.
(p) The relevant purchase agreements included in the [SERS
Transaction Documents] and the Other Acquisition Documents (the "Purchase
Agreements") give the Company (directly or as assignee) the right (subject only
to customary closing deliveries and other immaterial closing conditions), upon
payment of the amounts provided in such Purchase Agreements, to acquire the SERS
Properties and the Other Acquisition Properties, respectively. The Purchase
Agreements and all deeds, assignments, and other documents delivered or to be
delivered in connection therewith
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are legally sufficient to effect the sale to the Company of all right, title and
interest in and to the SERS Properties and the Other Acquisition Properties upon
payment of the amounts provided for in the Purchase Agreements. Upon the
consummation of the SERS Transaction and the Other Acquisition Transactions, the
Company (either directly or through a Subsidiary) will have, good and marketable
title in fee simple to each of the SERS Properties and the Other Acquisition
Properties, in each case, free and clear of all liens, charges, encumbrances,
claims, security interests, defects, and restrictions, other than those
described in the Registration Statement and the Prospectus and those which do
not and will not have a material adverse effect on the condition (financial or
other), business, prospects, properties, net worth or results of operations of
the Company and the Subsidiaries taken as a whole.
(q) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), neither
the Company nor any of the Subsidiaries has incurred any liability or
obligation, direct or contingent, or entered into any transaction, not in the
ordinary course of business, that is material to the Company and the
Subsidiaries taken as a whole, and there has not been any change in the capital
stock, or material increase in the short-term debt or long-term debt, of the
Company or any of the Subsidiaries, or any material adverse change, or any
development involving or which may reasonably be expected to involve, a
prospective material adverse change, in the condition (financial or other),
business, prospects, properties, net worth or results of operations of the
Company and the Subsidiaries taken as a whole.
(r) Each of the Company or the Operating Partnership (either
directly or through a Subsidiary) has, and after giving effect to the SERS
Transaction and the Other Acquisition Transactions will have, good and
marketable title to all property (real and personal) described in the Prospectus
as being or to be owned by it, free and clear of all liens, claims, security
interests or other encumbrances except such as are described in the Registration
Statement and the Prospectus or in a document filed as an exhibit to the
Registration Statement and all the property described in the Prospectus as being
held under lease by each of the Company and the Subsidiaries is held by it under
valid, subsisting and enforceable leases.
(s) The Company has not distributed and, prior to the later to
occur of (i) the Closing Date and (ii) completion of the distribution of the
Shares, will not distribute any offering material in connection with the
offering and sale of the Shares other than the Registration Statement, the
Prepricing Prospectus, the Prospectus or other materials, if any, permitted by
the Act.
(t) Each of the Company and each of the Subsidiaries has, and
after giving effect to the SERS Transaction and the Other Acquisition
Transaction will have, such permits, licenses, franchises and authorizations of
governmental or regulatory authorities ("permits") as are necessary to own its
respective properties and to conduct its business in the manner described in the
Prospectus; each of the Company and each of the Subsidiaries has fulfilled and
performed all its material obligations with respect to such permits and no event
has occurred which allows, or after notice or lapse of time would allow,
revocation or termination thereof or results in any other material impairment of
the rights of the holder of any such permit, subject in each case to such
qualification
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as may be set forth in the Prospectus; and, except as described in the
Prospectus, none of such permits contains any restriction that is materially
burdensome to the Company or any of the Subsidiaries.
(u) The Company together with the Subsidiaries maintains and
will maintain a system of internal accounting controls sufficient to provide
reasonable assurances that (i) transactions are executed in accordance with
management's general or specific authorization; (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain accountability for
assets; (iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(v) Neither the Company nor any of its Subsidiaries nor any
employee or agent of the Company or any Subsidiary has made any payment of funds
of the Company or any Subsidiary or received or retained any funds in violation
of any law, rule or regulation, which payment, receipt or retention of funds is
of a character required to be disclosed in the Prospectus.
(w) The Company and each of the Subsidiaries have filed all
tax returns required to be filed, which returns are complete and correct, and
neither the Company nor any Subsidiary is in default in the payment of any taxes
which were payable pursuant to said returns or any assessments with respect
thereto.
(x) Except as described in the Prospectus, there is no holder
of any security of the Company, or the Operating Partnership or any other person
who has the right, contractual or otherwise, to cause the Company to sell or
otherwise issue to them, or to permit them to underwrite the sale of, the Shares
or the right to have any Common Shares or other securities of the Company
included in the Registration Statement or the right, as a result of the filing
of the registration statement or sale of the Shares as contemplated by this
Agreement, to require registration under the Act of any Common Shares or other
securities of the Company.
(y) The Company and the Subsidiaries own or possess all
patents, trademarks, trademark registrations, service marks, service xxxx
registrations, trade names, copyrights, licenses, inventions, trade secrets and
rights described in the Prospectus as being owned by them or any of them or
necessary for the conduct of their respective businesses, and neither the
Company nor the Operating Partnership is aware of any claim to the contrary or
any challenge by any other person to the rights of the Company and the
Subsidiaries with respect to the foregoing.
(z) None of the Company or any Subsidiary is now, and after
sale of the Shares to be sold by it hereunder and application of the net
proceeds from such sale as described in the Prospectus under the caption "Use of
Proceeds" will be, an "investment company," or entity "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
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(aa) The Company has filed in a timely manner each document or
report required to be filed by it pursuant to the Exchange Act and the rules and
regulations thereunder; each such document or report at the time it was filed
conformed to the requirements of the Exchange Act and the rules and regulations
thereunder; and none or such documents or reports contained an untrue statement
of any material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not misleading.
(bb) The Company and its Subsidiaries are organized and
operate in the manner described in the Registration Statement so that the
Company meets the requirements for qualification as a real estate investment
trust under Sections 856 through 860 of the Code and the rules and regulations
thereunder as currently in effect. Each Subsidiary that is a partnership will be
treated as a partnership, and not as an association taxable as a corporation or
a publicly traded partnership, for federal income tax purposes.
(cc) The Shares are duly authorized for listing, subject to
official notice of issuance, on the American Stock Exchange.
(dd) Neither the Company nor any of its trustees, officers or
controlling persons has taken, directly or indirectly, any action intended, or
which might reasonably be expected, to cause or result, under the Act or
otherwise, in, or which has constituted, stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
Shares.
(ee) Except as described in the Prospectus, the mortgages and
deeds of trust encumbering the Properties will not be cross-defaulted or
cross-collateralized with any other property not owned directly or indirectly by
the Company or any of the Subsidiaries.
(ff) (1) Each of the Properties, the Company, and each of the
Subsidiaries (i) is, and as of the Closing Date will be, in compliance in all
material respects with any and all applicable foreign, federal, state and local
laws and regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) has received, or will have received,
as of the Closing Date and upon consummation of the SERS Transaction and the
Other Acquisition Transactions, as the case may be, all permits, licenses or
other approvals required of them under applicable Environmental Laws to conduct
their respective business, and (iii) is, and will be as of the Closing Date in
material compliance with all terms and conditions of any such permit, license or
approval.
(2) Except as may be specifically disclosed in the
Phase I Environmental Site Assessment reports referred to in the Prospectus (the
"Environmental Reports"), the Company and the Subsidiaries have not at any time,
and, to the knowledge of the Company, no other party has at any time, handled,
buried, stored, retained, refined, transported, processed, manufactured,
generated, produced, spilled, allowed to seep, leak, escape or xxxxx, or be
pumped, poured, emitted, emptied, discharged, injected, dumped, transferred or
otherwise disposed of or dealt with, Hazardous Materials (as hereinafter
defined) on, to or from the Properties. The Company and the Subsidiaries do not
intend to use the Properties or any subsequently acquired properties for the
purpose of handling, burying, storing, retaining, refining, transporting,
processing, manufacturing, generating,
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producing, spilling, seeping, leaking, escaping, leaching, pumping, pouring,
emitting, emptying, discharging, injecting, dumping, transferring or otherwise
disposing of or dealing with Hazardous Materials.
(3) Except as disclosed in the Environmental Reports,
to the knowledge of the Company, there has been no seepage, leaking, escape,
leaching, discharge, injection, release, emission, spill, pumping, pouring,
emptying or dumping of Hazardous Materials into waters on or adjacent to the
Properties or onto lands from which such hazardous or toxic waste or substances
might seep, flow or drain into such waters.
(4) Except as disclosed in the Environmental Reports,
neither the Company nor any Subsidiary has received notice of any occurrence or
circumstance which, with notice or passage of time or both, would give rise to,
any claim under or pursuant to any Environmental Law pertaining to hazardous or
toxic waste or substances on or originating from the Properties or arising out
of the conduct of any such party, including, without limitation, pursuant to and
Environmental Law.
(5) No environmental engineering firm which prepared
the Environmental Reports (or amendments thereto) or physical condition
(engineering) reports with respect to the Properties was employed for such
purpose on a contingent basis or has any substantial interest in the Company or
any Subsidiary.
As used herein, "Hazardous Material" shall include, without
limitation, any flammable explosives, radioactive materials, hazardous
materials, hazardous wastes, hazardous or toxic substances or related materials,
asbestos or any material as defined by any Federal, state or local environmental
law, ordinance, rule, or regulation including, without limitation. The
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended (42 U.S.C. Section 9601, et seq.) ("CERCLA"), the Hazardous Materials
Transportation Act, as amended (49 U.S.C. Section 1801, et seq.), the Resource
Conservation and Recovery Act, as amended (42 U.S.C. Section 9601, et seq.) The
New Jersey Industrial Site Recovery Act, N.J.S.A.Section 13:1K-6, et seq. or and
in the regulations adopted and publications promulgated pursuant to each of the
foregoing or by any Federal, state or local Governmental authority having or
claiming jurisdiction over the Properties as described in the Prospectus
(collectively, "Environmental Laws").
(gg) To the knowledge of the Company, all physical condition
(engineering) reports obtained for the Properties are materially true and
correct. Neither the Company nor any of the Subsidiaries is aware of any
material capital expenditures (other than expenditures for maintenance in the
ordinary course of business) which will be required in connection with any of
the Properties prior to the fifth anniversary of this Agreement.
(hh) As of the Closing Date and after giving effect to the
SERS Transaction and the Other Acquisition Transactions, the Company or the
Operating Partnership, as applicable, will have obtained ALTA Extended Coverage
Owner's Policies of Title Insurance from title insurers of recognized financial
responsibility on each of the SERS Properties and the Other Acquisition
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Properties in amounts at least equal to the acquisition price of each such
property (and improvements located on such property), and such insurance shall
be in full force and effect.
(ii) The assets of the Company and the Subsidiaries do not,
and as of the Closing Date and after giving effect to the any of the
Transactions do not and will not constitute, "plan assets" under the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
(jj) The transfer of interests in the SERS Properties by SERS
and RAI to the Company in exchange for, among other things, Preferred Stock and
warrants to purchase Common Shares under the SERS Investment Documents relating
to such exchange does not constitute a prohibited transaction within the meaning
of section 406 of ERISA for which an exemption is not available.
8. Indemnification and Contribution. (a) The Company and the Operating
Partnership, jointly and severally, agree to indemnify and hold harmless each of
you and each other Underwriter, the directors, officers, employees and agents of
each Underwriter, and each person, if any, who controls any Underwriter within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act from and
against any and all losses, claims, damages, liabilities and expenses (including
reasonable costs of investigation) arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in any
Prepricing Prospectus or in the Registration Statement or the Prospectus or in
any amendment or supplement thereto, or arising out of or based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon and in conformity with the information relating to such
Underwriter furnished in writing to the Company by or on behalf of any
Underwriter through you expressly for use in connection therewith (which
information is described in its entirety in Section 13 below); provided,
however, that the indemnification contained in this paragraph (a) with respect
to any Prepricing Prospectus shall not inure to the benefit of any Underwriter
(or to the benefit of any person controlling such Underwriter) on account of any
such loss, claim, damage, liability or expense arising from the sale of the
Shares by such Underwriter to any person if a copy of the Prospectus shall not
have been delivered or sent to such person within the time required by the Act
and the regulations thereunder, and the untrue statement or alleged untrue
statement or omission or alleged omission of a material fact contained in such
Prepricing Prospectus was corrected in the Prospectus, provided that the Company
has delivered the Prospectus to the several Underwriters in requisite quantity
on a timely basis to permit such delivery or sending within the time required by
the Act. The foregoing indemnity agreement shall be in addition to any liability
which the Company may otherwise have.
(b) If any action, suit or proceeding shall be brought against any
Underwriter or any person controlling any Underwriter in respect of which
indemnity may be sought against the Company or the Operating Partnership, such
Underwriter or such controlling person shall promptly notify the Company or the
Operating Partnership, and the Company or the Operating Partnership shall assume
the defense thereof, including the employment of counsel and payment of all fees
and expenses. Such Underwriter or any such controlling person shall have the
right to employ separate
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counsel in any such action, suit or proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
such Underwriter or such controlling person unless (i) the Company and the
Operating Partnership have agreed in writing to pay such fees and expenses, (ii)
the Company and the Operating Partnership have failed to assume the defense and
employ counsel, or (iii) the named parties to any such action, suit or
proceeding (including any impleaded parties) include both such Underwriter or
such controlling person and the Company or the Operating Partnership and such
Underwriter or such controlling person shall have been advised by its counsel
that representation of such indemnified party and the Company or the Operating
Partnership by the same counsel would be inappropriate under applicable
standards of professional conduct (whether or not such representation by the
same counsel has been proposed) due to actual or potential differing interests
between them (in which case the Company and the Operating Partnership shall not
have the right to assume the defense of such action, suit or proceeding on
behalf of such Underwriter or such controlling person). It is understood,
however, that the Company shall, in connection with any one such action, suit or
proceeding or separate but substantially similar or related actions, suits or
proceedings in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
all such Underwriters and controlling persons not having actual or potential
differing interests with you or among themselves, which firm shall be designated
in writing by Xxxxx Xxxxxx Inc., and that all such fees and expenses shall be
reimbursed as they are incurred. The Company and the Operating Partnership shall
not be liable for any settlement of any such action, suit or proceeding effected
without its written consent, but if settled with such written consent, or if
there be a final judgment for the plaintiff in any such action, suit or
proceeding, the Company and the Operating Partnership agree to indemnify and
hold harmless any Underwriter, to the extent provided in the preceding
paragraph, and any such controlling person from and against any loss, claim,
damage, liability or expense by reason of such settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its trustees and officers who sign the
Registration Statement, and any person who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the same
extent as the foregoing indemnity from the Company and the Operating Partnership
to each Underwriter, but only with respect to losses, claims, damages,
liabilities and expenses arising out of or based upon any untrue statement or
alleged untrue statement of a material fact set forth in the information
relating to such Underwriter furnished in writing by or on behalf of such
Underwriter through you expressly for use in the Registration Statement, the
Prospectus or any Prepricing Prospectus, or any amendment or supplement thereto.
If any action, suit or proceeding shall be brought against the Company, any of
its directors or officers, or any such controlling person based on the
Registration Statement, the Prospectus or any Prepricing Prospectus, or any
amendment or supplement thereto, and in respect of which indemnity may be sought
against any Underwriter pursuant to this paragraph (c), such Underwriter shall
have the rights and duties given to the Company and the Operating Partnership by
paragraph (b) above (except that if the Company or the Operating Partnership
shall have assumed the defense thereof such Underwriter shall not be required to
do so, but may employ separate counsel therein and participate in the defense
thereof, but the fees and expenses of such counsel shall be at such
Underwriter's expense), and the Company, its directors and officers, and any
such controlling person shall have the rights and duties given to the
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Underwriters by paragraph (b) above. The foregoing indemnity agreement shall be
in addition to any liability which the Underwriters may otherwise have.
(d) If the indemnification provided for in this Section 8 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Operating Partnership on the one hand and the Underwriters on
the other hand from the offering of the Shares, or (ii) if the allocation
provided by clause (i) above 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
Operating Partnership on the one hand and the Underwriters on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Operating Partnership 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 and the Operating
Partnership 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 of the Company on the one hand and the
Underwriters on the other hand 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 on the one hand or by the Underwriters on the other hand
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
(e) The Company and the Operating Partnership and the Underwriters agree
that it would not be just and equitable if contribution pursuant to this Section
8 were determined by a pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
that does not take account of the equitable considerations referred to in
paragraph (d) above. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities and expenses referred to in
paragraph (d) above shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating any claim or defending any such action,
suit or proceeding. Notwithstanding the provisions of this Section 8, no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price of the Shares underwritten by it and distributed 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 to contribute pursuant to this
Section 8 are several in proportion to the respective numbers of Firm Shares set
forth opposite their names in Schedule I hereto (or such numbers of Firm Shares
increased as set forth in Section 11 hereof) and not joint.
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(f) No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
action, suit or proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such action, suit or proceeding.
(g) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 8 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 8 and the
representations and warranties of the Company and the Operating Partnership set
forth in this Agreement shall remain operative and in full force and effect,
regardless of (i) any investigation made by or on behalf of any Underwriter or
any person controlling any Underwriter, the Company and its trustees or
officers, the Operating Partnership and its officers, or any person controlling
the Company or the Operating Partnership, (ii) acceptance of any Shares and
payment therefor hereunder, and (iii) any termination of this Agreement. A
successor to any Underwriter or any person controlling any Underwriter, or to
the Company and its trustees or officers, the Operating Partnership and its
officers, or any person controlling the Company or the Operating Partnership,
shall be entitled to the benefits of the indemnity, contribution, and
reimbursement agreements contained in this Section 8.
9. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase the Firm Shares hereunder are subject to the
following conditions:
(a) If, at the time this Agreement is executed and delivered,
it is necessary for the registration statement or a post-effective amendment
thereto to be declared effective before the offering of the Shares may commence,
the registration statement or such post-effective amendment shall have become
effective not later than 5:30 P.M., New York City time, on the date hereof, or
at such later date and time as shall be consented to in writing by you, and all
filings, if any, required by Rules 424 and 430A under the Act shall have been
timely made; no stop order suspending the effectiveness of the registration
statement shall have been issued and no proceeding for that purpose shall have
been instituted or, to the knowledge of the Company or any Underwriter,
threatened by the Commission, and any request of the Commission for additional
information (to be included in the registration statement or the prospectus or
otherwise) shall have been complied with to your satisfaction.
(b) Subsequent to the effective date of this Agreement, there
shall not have occurred (i) any change, or any development involving a
prospective change, in or affecting the condition (financial or other),
business, prospects, properties, net worth, or results of operations of the
Company or the Subsidiaries not contemplated by the Prospectus, which in your
opinion, as Representatives of the several Underwriters, would materially,
adversely affect the market for the Shares, or (ii) any event or development
relating to or involving the Company or any officer or director of the Company
or the Operating Partnership which makes any statement made in the Prospectus
untrue or which, in the opinion of the Company and its counsel or the
Underwriters and their counsel, requires the making of any addition to or change
in the Prospectus in order to state a
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21
material fact required by the Act or any other law to be stated therein or
necessary in order to make the statements therein not misleading, if amending or
supplementing the Prospectus to reflect such event or development would, in your
opinion, as Representatives of the several Underwriters, materially, adversely
affect the market for the Shares.
(c) You shall have received on the Closing Date, opinions of
Pepper, Xxxxxxxx & Xxxxxxx counsel for the Company, the Operating Partnership
and the other Subsidiaries, dated the Closing Date and addressed to you, as
Representatives of the several Underwriters, in the form set forth on Exhibit
9(c) attached hereto.
In rendering their opinions as aforesaid, counsel may rely
upon an opinion or opinions, each dated the Closing Date, of other counsel
retained by them or the Company as to laws of any jurisdiction other than the
United States, the State of [New York], the Commonwealth of Pennsylvania and the
State of Delaware, provided that (1) each such local counsel is acceptable to
the Representatives, (2) such reliance is expressly authorized by each opinion
so relied upon and a copy of each such opinion is delivered to the
Representatives and is, in form and substance, satisfactory to them and their
counsel, and (3) counsel shall state in their opinion that they believe that
they and the Underwriters are justified in relying thereon.
(d) You shall have received on the Closing Date an opinion of
Xxxxxx Xxxxxxxx LLP, special tax advisor to the Company, satisfactory in form
and substance to you, to the effect that (i) the descriptions of the Federal
income tax conclusions contained in the Prospectus under the caption "Federal
Income Tax Considerations" are correct in all material respects, and a
discussion contained therein fairly summarizes the Federal income tax
considerations that may be material to a holder of the common Shares; (ii)
assuming the Company is operated in accordance with the assumptions and
representations of management regarding its activities and intended activities,
the Company will continue to qualify as a REIT under the Code; and (iii) the
Operating Partnership and the Title Holding Partnerships will be treated for
Federal income tax purposes as partnerships and not as associations taxable as
corporations or as publicly-traded partnerships.
(e) You shall have received on the Closing Date, an opinion of
Xxxxxx Xxxxxxxx LLP, special tax advisor to the Company, dated the Closing Date
and addressed to you, as Representatives of the several Underwriters,
satisfactory in form and substance to you, to the effect that the Company will
not be considered to own more than ten percent of the outstanding voting
securities of Brandywine Realty Services Corp. at the close of the quarter
ending September 30, 1996.
(f) You shall have received on the Closing Date an opinion of
Battle Xxxxxx LLP, counsel for the Underwriters, dated the Closing Date and
addressed to you, as Representatives of the several Underwriters, with respect
to the Registration Statement, the Prospectus and this Agreement and such other
related matters as you may request.
(g) You shall have received comfort letters, including, but
not limited to, certain agreed upon procedures, addressed to you, as
Representatives of the several Underwriters, and dated the date hereof and the
Closing Date from Xxxxxx Xxxxxxxx LLP, independent public accountants,
substantially in the forms heretofore approved by you.
(h) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been taken or, to the knowledge of the Company or the
Underwriters, shall be contemplated by the Commission at or prior to the Closing
Date; (ii) there shall not have been any change in the capital stock of the
Company nor any material increase in the short-term or long-term debt of the
Company (other than in the ordinary course of business) from that set forth or
contemplated in the Registration Statement or the Prospectus (or any amendment
or Supplement thereto); (iii) there shall not have been, since
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the respective dates as of which information is given in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), except as
may otherwise be stated in the Registration Statement and Prospectus (or any
amendment or supplement thereto), any material adverse change in the condition
(financial or other), business, prospects, properties, net worth or results of
operations of the Properties or the Company and the Subsidiaries taken as a
whole; (iv) the Company and the Subsidiaries shall not have any liabilities or
obligations, direct or contingent (whether or not in the ordinary course of
business), that are material to the Company and the Subsidiaries, taken as a
whole, other than those reflected in the Registration Statement or the
Prospectus (or any amendment or supplement thereto); and (v) all the
representations and warranties of the Company and the Operating Partnership
contained in this Agreement shall be true and correct on and as of the date
hereof and on and as of the Closing Date as if made on and as of the Closing
Date, and you shall have received a certificate, dated the Closing Date and
signed by the chief executive officer and the chief financial officer of the
Company (or such other officers as are acceptable to you), to the effect set
forth in this Section 9(g) and in Section 9(i) hereof.
(i) On or prior to the Closing Date, the Representatives shall
have received the executed "lock-up" agreements referred to in Section 6(p).
(j) The Company shall not have failed at or prior to the
Closing Date to have performed or complied with any of its agreements herein
contained and required to be performed or complied with by it hereunder at or
prior to the Closing Date.
(k) The Shares shall have been listed or approved for listing
upon notice of issuance on the American Stock Exchange.
(l) All of the Transaction Documents shall have been executed
and, if applicable, delivered contemporaneously with or prior to the sale of the
Firm Shares.
(m) Each of the SERS Transaction, the Other Acquisitions, the
Xxxxxx Xxxxxxx Private Placement, and the SERS Private Placement shall have been
consummated contemporaneously with or prior to the sale of the Firm Shares
hereunder.
(n) The Company shall have delivered to the Underwriters
satisfactory evidence of the following with respect to each SERS Property and
Other Acquisition Property:
(i) a copy of an executed and recordable valid deed
therefor, naming the Company or the Operating Partnership, as applicable, as the
grantee thereunder;
(ii) an ALTA Extended Coverage Owner's Policy of Title
Insurance (or a commitment to issue such a policy) naming the Company or the
Operating Partnership, as applicable, as name insured and insuring (or
committing to insure) that the Company or a Subsidiary owns fee title to the
real property in an amount at least equal to the acquisition price of each such
property (and improvements located on such property), which policy (or
commitment) shall be issued by a title insurance company reasonably acceptable
to the Underwriters (any such person or persons, the "Title Company"), and
contain as exceptions to title only the exceptions described in
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the Transaction Documents relating to the transfer of such Property in
connection with the applicable Transaction or which counsel for the Underwriters
shall have approved (the "Permitted Exceptions") and any such endorsements to
such policy as the Underwriters may reasonably require;
(iii) a survey of the Property in form satisfactory to the
Underwriters and the Title Company in connection with the issuance of an ALTA
Extended Coverage Owner's Policy of Title Insurance;
(iv) policies or certificates of insurance relating to
such Property evidencing coverages and in amounts customarily obtained by owners
of similar properties;
(v) copies of such affidavits, certificates and
instruments of indemnification as shall reasonably be required to induce the
Title Company to issue the policy (or commitment) contemplated in subparagraph
(ii) above;
(vi) a schedule or other written evidence of checks
payable to the appropriate public officials in payment of all recording costs
and transfer taxes (or checks or wire transfers to the Title Company in respect
of such amounts) due in respect of any recording of instruments in connection
with the applicable Transactions, together with a check or wire transfer for the
Title Company in payment of the Title Company's premium, search and examination
charges, survey costs and any other amounts due in connection with the issuance
of its policy;
(vii) if such Property is to remain subject after the
applicable Transaction to an existing indenture, mortgage, deed of trust, loan
agreement, bond debenture, note agreement or other evidence of indebtedness
("Existing Indebtedness"), an agreement dated not earlier than 30 days prior to
the Closing Date from the holder of such Existing Indebtedness together with any
other necessary party indicating such holder's consent to those Transactions
requiring its consent and effecting any required modifications to the documents
evidencing such Existing Indebtedness;
(viii) an engineering (structural) report from an engineer
or engineers and in a form reasonably satisfactory to you; and
(ix) such other agreements, documents, instruments,
reports, articles or evidences of payments properly executed, where applicable,
as may be required pursuant to the Transaction Documents to effect the transfer
of such Property in connection with the Transactions.
(o) All actions necessary to permit the Company to make
borrowings under the Credit Facility, as defined and described in the
Prospectus, shall have been taken.
(p) The Company shall have furnished or caused to be furnished
to you such further certificates and documents as you shall have requested.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to you and your counsel.
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Any certificate or document signed by any officer of the Company and
delivered to you, as Representatives of the Underwriters, or to counsel for the
Underwriters, shall be deemed a representation and warranty by the Company to
each Underwriter as to the statements made therein.
The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the satisfaction on and as of any Option Closing
Date of the conditions set forth in this Section 9, except that, if any Option
Closing Date is other than the Closing Date, the certificates, opinions and
letters referred to in paragraphs (c) through (g) shall be dated the Option
Closing Date in question and the opinions called for by paragraphs (c), (d), (e)
and (f) shall be revised to reflect the sale of Additional Shares.
10. Expenses. The Company agrees to pay the following costs and
expenses and all other costs and expenses incident to the performance by it of
its obligations hereunder: (i) the preparation, printing or reproduction, and
filing with the Commission of the registration statement (including financial
statements and exhibits thereto), any Rule 462(b) Registration Statements, each
Prepricing Prospectus, the Prospectus, and each amendment or supplement to any
of them; (ii) the printing (or reproduction) and delivery (including postage,
air freight charges and charges for counting and packaging) of such copies of
the registration statement, each Prepricing Prospectus, the Prospectus, and all
amendments or supplements to any of them as may be reasonably requested for use
in connection with the offering and sale of the Shares; (iii) the preparation,
printing, authentication, issuance and delivery of certificates for the Shares,
including any stamp taxes in connection with the original issuance and sale of
the Shares; (iv) the printing (or reproduction) and delivery of this Agreement,
the preliminary and supplemental Blue Sky Memoranda and all other agreements or
documents printed (or reproduced) and delivered in connection with the offering
of the Shares; (v) the registration of the Common Shares under the Exchange Act
and the listing of the Shares on the American Stock Exchange; (vi) the
registration or qualification of the Shares for offer and sale under the
securities or Blue Sky laws of the several states as provided in Section 6(g)
hereof (including the reasonable fees, expenses and disbursements of counsel for
the Underwriters relating to the preparation, printing or reproduction, and
delivery of the preliminary and supplemental Blue Sky Memoranda and such
registration and qualification); (vii) the filing fees and the fees and expenses
of counsel for the Underwriters in connection with any filings required to be
made with the National Association of Securities Dealers, Inc.; (viii) the
transportation and other expenses incurred by or on behalf of Company
representatives in connection with presentations to prospective purchasers of
the Shares; (ix) the fees and expenses of the Company's accountants and the fees
and expenses of counsel (including local and special counsel) for the Company.
11. Effective Date of Agreement. This Agreement shall become effective:
(i) upon the execution and delivery hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed and delivered, it is necessary for the
registration statement or a post-effective amendment thereto to be declared
effective before the offering of the Shares may commence, when notification of
the effectiveness of the registration statement or such post-effective amendment
has been released by the Commission. Until such time as this Agreement shall
have become effective, it may be terminated by the Company, by notifying you, or
by you, as Representatives of the several Underwriters, by notifying the
Company.
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If any one or more of the Underwriters shall fail or refuse to
purchase Firm Shares which it or they are obligated to purchase hereunder on the
Closing Date, and the aggregate number of Firm Shares which such defaulting
Underwriter or Underwriters are obligated but fail or refuse to purchase is not
more than one-tenth of the aggregate number of Firm Shares which the
Underwriters are obligated to purchase on the Closing Date, each non-defaulting
Underwriter shall be obligated, severally, in the proportion which the number of
Firm Shares set forth opposite its name in Schedule I hereto bears to the
aggregate number of Firm Shares set forth opposite the names of all
non-defaulting Underwriters or in such other proportion as you may specify in
accordance with Section 20 of the Master Agreement Among Underwriters of Xxxxx
Xxxxxx Inc., to purchase the Firm Shares which such defaulting Underwriter or
Underwriters are obligated, but fail or refuse, to purchase. If any one or more
of the Underwriters shall fail or refuse to purchase Firm Shares which it or
they are obligated to purchase on the Closing Date and the aggregate number of
Firm Shares with respect to which such default occurs is more than one-tenth of
the aggregate number of Firm Shares which the Underwriters are obligated to
purchase on the Closing Date and arrangements satisfactory to you and the
Company for the purchase of such Firm Shares by one or more non-defaulting
Underwriters or other party or parties approved by you and the Company are not
made within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Company. In any
such case which does not result in termination of this Agreement, either you or
the Company shall have the right to postpone the Closing Date, but in no event
for longer than seven days, in order that the required changes, if any, in the
Registration Statement and the Prospectus or any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any such default of any such
Underwriter under this Agreement. The term "Underwriter" as used in this
Agreement includes, for all purposes of this Agreement, any party not listed in
Schedule I hereto who, with your approval and the approval of the Company,
purchases Shares which a defaulting Underwriter is obligated, but fails or
refuses, to purchase.
Any notice under this Section 11 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
12. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Company, by notice to the Company, if prior to the Closing
Date or any Option Closing Date (if different from the Closing Date and then
only as to the Additional Shares), as the case may be, (i) trading in the Common
Shares shall have been suspended by the Commission or the American Stock
Exchange, (ii) trading in securities generally on the New York Stock Exchange,
the American Stock Exchange or the Nasdaq National Market shall have been
suspended or materially limited, (iii) a general moratorium on commercial
banking activities in New York or Pennsylvania shall have been declared by
either federal or state authorities, or (iv) there shall have occurred any
outbreak or escalation of hostilities or other international or domestic
calamity, crisis or change in political, financial or economic conditions, the
effect of which on the financial markets of the United States is such as to make
it, in your judgment, impracticable or inadvisable to commence or continue the
offering of the Shares at the offering price to the public set forth on the
cover page of the Prospectus or to enforce contracts for the resale of the
Shares by the Underwriters. Notice of such termination may be given to the
Company by telegram, telecopy or telephone and shall be subsequently confirmed
by letter.
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13. Information Furnished by the Underwriters. The Company and the
Operating Partnership acknowledge and agree that the statements set forth in the
last paragraph on the cover page, the stabilization legend on the inside cover
page, the list of Underwriters and their respective allotments appearing under
the caption "Underwriting" in the Prospectus and the statements in the first and
third paragraphs under the caption "Underwriting" in any Prepricing Prospectus
and in the Prospectus, constitute the only information furnished by or on behalf
of the Underwriters through you as such information is referred to in Sections
7(b) and 8 hereof.
14. Miscellaneous. Except as otherwise provided in Sections 6, 11 and
12 hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (i) if to the Company or the Operating
Partnership, at the office of the Company at 00 Xxxxxx Xxxxxxxxx, Xxxxxxx
Xxxxxx, Xxxxxxxxxxxx 00000, Attention: Xxxxxx X. Xxxxxxx, President and Chief
Executive Officer; or (ii) if to you, as Representatives of the several
Underwriters, care of Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Manager, Investment Banking Division.
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Company, its trustees and officers, the Operating
Partnership and the other controlling persons referred to in Section 8 hereof
and their respective successors and assigns, to the extent provided herein, and
no other person shall acquire or have any right under or by virtue of this
Agreement. Neither the term "successor" nor the term "successors and assigns" as
used in this Agreement shall include a purchaser from any Underwriter of any of
the Shares in his status as such purchaser.
15. Applicable Law; Counterparts. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
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Please confirm that the foregoing correctly sets forth the agreement
between the Company, the Operating Partnership and the several Underwriters.
Very truly yours,
BRANDYWINE REALTY TRUST
By
---------------------------------------
Xxxxxx X. Xxxxxxx
President and Chief Executive Officer
BRANDYWINE OPERATING PARTNERSHIP, L.P.
By Brandywine Realty Trust,
its general partner
By
-----------------------------
Xxxxxx X. Xxxxxxx
President and Chief Executive Officer
Confirmed as of the date first
above mentioned on behalf of
themselves and the other several
Underwriters named in Schedule I
hereto.
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
As Representatives of the Several Underwriters
By XXXXX XXXXXX INC.
By
-------------------------------
Managing Director
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SCHEDULE I
BRANDYWINE REALTY TRUST
Number of
Underwriter Firm Shares
----------- -----------
Xxxxx Xxxxxx Inc.............................................
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated.........................
Total............ 3,700,000
29
SCHEDULE 2(a)
SSI/TNC Documents
30
SCHEDULE 2(c)(1)
SERS Transaction Documents
31
SCHEDULE 2(c)(2)
SERS Investment Documents
32
SCHEDULE 2(e)
Xxxxxx Xxxxxxx Investment Documents
33
SCHEDULE 2(f)
Other Acquisition Documents
34
SCHEDULE 2(h)
Subsidiaries of the Company
35
SCHEDULE 6(p)
Persons and Entities to Deliver Lock-up Letters
36
SCHEDULE 7(f)
Ownership Interests in Subsidiaries
37
Exhibit 9(c)
Form of Company Counsel Legal Opinion
1. The Company is duly formed and validly existing as a real
estate investment trust in good standing under and by virtue of the laws of the
State of Maryland, with full trust power and authority to own, lease, and
operate its properties and to conduct its business as described in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto), and is duly registered and qualified to conduct its business and is in
good standing in each jurisdiction or place where the nature of its properties
or the conduct of its business as described in the Registration Statement and
the Prospectus requires such registration or qualification; except where the
failure to so qualify would not have a material adverse effect on the condition,
financial or otherwise, business, properties, net worth or results of operations
of the Company.
2. Each of the Subsidiaries is a corporation, limited
partnership or general partnership duly incorporated or formed, as the case may
be, validly existing and in good standing under the laws of its jurisdiction of
incorporation or formation, with full corporate or partnership power and
authority, as the case may be, to own, lease, and operate its properties and to
conduct its business as described in the Registration Statement and the
Prospectus (and any amendment or supplement thereto), and is duly registered and
qualified to conduct its business and is in good standing in each jurisdiction
or place where the nature of its properties or the conduct of its business as
described in the Registration Statement and the Prospectus requires such
registration or qualification; except where the failure to so qualify would not
have a material adverse effect on the condition, financial or otherwise,
business, properties, net worth or results of operations of such Subsidiary.
3. The authorized and outstanding capital stock of the Company
is as set forth under the caption "Capitalization" in the Prospectus; and the
authorized capital stock (including, but not limited to, any options, warrants
or other securities convertible into or exchangeable for capital stock of the
Company) conforms in all material respects to the description thereof in the
Registration Statement and the Prospectus. All the shares of capital stock of
the Company outstanding prior to the issuance of the Shares have been duly
authorized and validly issued, are fully-paid and nonassessable, and are free of
any preemptive or similar rights under Maryland law.
4. The Shares have been duly authorized and, when issued and
delivered to the Underwriters against payment therefor in accordance with the
terms of the Underwriting Agreement, will be validly issued, fully-paid and
nonassessable and free of any preemptive or, to the best of our knowledge after
reasonable inquiry, similar rights that entitle or will entitle any person or
entity to acquire any Shares upon the issuance thereof by the Company.
5. Except as described in the Prospectus, there are no
outstanding options, warrants or other rights calling for the issuance of, and,
to the best of our knowledge, there is no commitment, plan or arrangement to
issue, any shares of capital stock of the Company or any security convertible
into or exchangeable or exercisable for capital stock of the Company. Except as
described in the Prospectus, there is no holder of any security of the Company
or any other person who has the right, contractual or otherwise, to cause the
Company to sell or otherwise issue to them, or to permit them to underwrite the
sale of, the Shares or the right to have any Common Shares or other securities
of the Company included in the registration statement or the right, as a result
of the filing of the registration statement or sale of the Shares as
contemplated by the Underwriting Agreement, to require registration under the
Act of any Common Shares or other securities of the Company.
38
6. All of the outstanding units of limited and general
partnership interests (the "Units") of the Operating Partnership, and the
partnership interests in each of the other Subsidiaries that are partnerships,
have been duly authorized and validly created and issued under the agreements
forming the Operating Partnership and such other Subsidiaries, as the case may
be, and are fully-paid, and all of the issued and outstanding shares of capital
stock of each of the Subsidiaries that are corporations have been duly
authorized and validly issued, and are fully-paid and non-assessable. Except as
described in the Registration Statement and the Prospectus, all such Units,
partnership interests and shares of capital stock and are owned by the Company
directly, or indirectly through one of the Subsidiaries, free and clear of any
security interest, lien, adverse claim, equity or other encumbrance, and the
Company's percentage ownership in the Operating Partnership, and the Company's
and the Operating Partnership's respective percentage interest and ownership in
each of the Subsidiaries is as set forth on Schedule I attached hereto and made
part hereof. Except as described in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), there are no outstanding
options, warrants or other rights calling for the issuance of, or any
commitment, plan or arrangement to issue, any equity interests in any
Subsidiary, or any security convertible into, or exchangeable or exercisable or,
any such interests in any such Subsidiary. The terms of the Units conform in all
material to statements and descriptions thereof contained in the Prospectus. The
Company is the sole general partner of the Operating Partnership.
7. All offers and sales of Units by the Operating Partnership,
and the offers and sales by the Company of Common Shares prior to the Effective
Date as described in the Registration Statement and the Prospectus have been
duly registered under the Act, or were issued in transactions exempt from the
registration requirements of the Act and state securities and Blue Sky laws. The
offer, sale and issuance by the Company of Common Shares pursuant to each of the
Xxxxxx Xxxxxxx Private Placement and the SERS Private Placement, and the offer,
sale and issuance by the Company of Preferred Shares in and pursuant to the SERS
Private Placement, in each case, were exempt from the registration requirements
of the Act and state securities and Blue Sky laws, and neither such transaction
required or requires the approval or consent of the Company's shareholders under
the Company's Declaration of Trust or Bylaws, the rules, regulations and
requirements of the American Stock Exchange, or Maryland law.
8. The Company has all trust power and authority, and the
Operating Partnership has all partnership power and authority, to enter into the
Underwriting Agreement and each Transaction Document, and, in the case of the
Company, to issue, sell and deliver the Shares to the Underwriters as provided
in the Underwriting Agreement, and each of the Underwriting Agreement and each
Transaction Document has been duly and validly authorized, executed and
delivered by the Company and the Operating Partnership and is a valid, legal and
binding agreement of each of the parties thereto, enforceable against each of
the parties thereto in accordance with its terms, except as enforcement of
rights to indemnity and contribution hereunder may be limited by Federal or
state securities laws or principles of public policy and subject to the
qualification that the enforceability of the Company's obligations hereunder may
be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors' rights generally
and by general equitable principles.
9. Each Subsidiary has all corporate or partnership power and
authority, as the case may be, to enter into each Transaction Document to which
it is a party, and each Transaction Document has been duly and validly
authorized, executed and delivered by each Subsidiary party thereto and is a
valid, legal and binding agreement of such Subsidiary, enforceable against such
Subsidiary in accordance with its terms, except as enforcement of rights to
indemnity and contribution hereunder may be limited by Federal or state
securities laws or principles of public policy and subject to the qualification
that the enforceability of each such Subsidiary's obligations thereunder may be
limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors' rights generally
and by general equitable principles.
2
39
10. Each of the Company and each of the Subsidiaries has all
necessary governmental authorizations, approvals, orders, licenses,
certificates, franchises and permits of and from all governmental regulatory
officials and bodies (except where the failure so to have any such
authorizations, approvals, orders, licenses, certificates, franchises or
permits, individually or in the aggregate, would not have a material adverse
effect on the condition, financial or otherwise, business, properties, net worth
or results of operations of the Company or such Subsidiary, respectively) to own
their respective properties and to conduct their respective businesses as now
being conducted and proposed to be conducted following the Additional
Acquisitions, as described in the Prospectus.
11. The Company and the Subsidiaries own all patents,
trademarks, trademark registrations, service marks, service xxxx registrations,
trade names, copyrights, licenses, inventions, trade secrets and other rights
described in the Prospectus as being owned by them or any of them or necessary
for the conduct of their respective businesses, and, to the best of our
knowledge, no claim to the contrary or any challenge by any other person to the
rights of the Company or the Subsidiaries with respect to the foregoing has been
asserted or threatened.
12. The form of certificate representing the Common Shares is
in due and proper form and complies with all applicable statutory requirements.
13. Neither the Company nor any of the Subsidiaries is in
violation of its respective Declaration of Trust, certificate or articles of
incorporation or bylaws, partnership agreement or other organizational
documents, or, to the best of our knowledge after reasonable inquiry, is in
default in the performance of any material obligation, agreement or condition
contained in any bond, debenture, note or other evidence of indebtedness.
14. With respect to the Company and the Subsidiaries, neither
the issuance and offer, sale or delivery of the Shares, the execution, delivery
or performance of the Underwriting Agreement and the Transaction Documents nor
the consummation of the transactions contemplated thereby by the Company or the
Subsidiaries, as applicable, (i) required or requires any consent, approval,
authorization or other order of, or registration or filing with, any court,
regulatory body, administrative agency or other governmental body, agency or
official, or the American Stock Exchange (except such as has been obtained for
the registration of the Shares under the Act, and state securities or Blue Sky
laws of various jurisdictions) (ii) conflicted with, conflicts or will conflict
with or constituted, constitutes or will constitute a breach of, or a default
under the Declaration of Trust, certificate or articles of incorporation or
bylaws, partnership agreement or other organizational documents, of any of such
entities, or under any agreement, indenture, lease or other instrument to which
any of such entities is a party or by which any of them or any of their
respective properties may be bound, which in each case has been filed as an
exhibit to the Registration Statement or is known to us after reasonable
inquiry, (iii) violated, violates or will violate any statute, law, regulation,
ruling, judgment, injunction, order or decree applicable to any of such entities
or any of their respective properties, or (iv) resulted or will result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of any of such entities pursuant to the terms of any agreement or
instrument to which any of them is a party or by which any of them may be bound
or to which any of the property or assets of any of them is subject.
15. Neither the Company nor any of the Subsidiaries is
required to be registered under the Investment Company Act of 1940, as amended.
16. To the best of our knowledge after reasonable inquiry, (A)
other than as described in the Prospectus (or any supplement thereto), there are
no proceedings pending or threatened against the Company or any of the
Subsidiaries or any of their respective trustees, directors or officers in their
capacity
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as such, or to which the Company or any of the Subsidiaries or any of their
respective trustees, directors or officers in their capacity as such, or any of
their respective property, is subject, that are required to be described in the
Registration Statement or Prospectus (or any amendment or supplement thereto)
and (B) there are no agreements, contracts, indentures, leases or other
instruments, that are required to be described in the Registration Statement or
the Prospectus (or any amendment or supplement thereto) or to be filed as an
exhibit to the Registration Statement that are not described or filed as
required by the Act.
17. To the best of our knowledge after reasonable inquiry,
neither the Company nor any Subsidiary is in violation of any law, ordinance,
administrative or governmental rule or regulation applicable to the Company or
any of the Subsidiaries or of any decree of any court or governmental agency or
body having jurisdiction over the Company or any of the Subsidiaries;
18. None of the Subsidiaries is currently contractually
prohibited, directly or indirectly, from paying any dividends to the Company,
from making any other distribution on such Subsidiary's capital stock or other
equity interests, from repaying to the Company any loans or advances to such
Subsidiary from the Company or from transferring any of such Subsidiary's
property or assets to the Company or any of the other Subsidiaries, except as
described in or contemplated by the Prospectus.
19. The statements set forth under the heading "Description of
Shares of Beneficial Interest" in the Prospectus, insofar as such statements
purport to summarize certain provisions of the Common Shares and Preferred
Shares, are accurate and present fairly in all material respects the information
required to be disclosed therein; and the statements set forth under the
headings "Risk Factors," "Structure of the Company," "Management," "Certain
Relationships and Transactions," "Certain Provisions of Maryland Law and of the
Company's Declaration of Trust and Bylaws," "Federal Income Tax Considerations,"
"Operating Partnership Agreement," "BRP General Partnership Agreement," "ERISA
Considerations," Shares Available for Future Sale," "Underwriting," "Tax
Matters," and "Available Information" in the Prospectus, insofar as such
statements are descriptions or summaries of contracts, agreements or other legal
documents, or refer to or constitute statements or matters of law, descriptions
of statutes, rules of regulations, or legal conclusions, are accurate and
present fairly in all material respects the information required to be shown.
20. The Initial Registration Statement, any Rule 462(b)
Registration Statement and the Prospectus and any supplements or amendments
thereto (except for the financial statements and the notes thereto and the
schedules and other financial, accounting and statistical data included therein
or excluded therefrom, as to which we do not express any opinion) comply as to
form in all material respects with the requirements of the Act.
21. The Registration Statement and all post-effective
amendments, if any, have become effective under the Act as of ______, 1996 and,
to the best of our knowledge after reasonable inquiry, no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose are pending before or contemplated by the
Commission, and any required filing of the Prospectus or Term Sheet that
constitutes a part thereof pursuant to Rules 424(b) and 434 has been made in
accordance with Rules 424(b) and 434.
22. If the Company elects to rely on Rule 434, the Prospectus
is not "materially different," as such term is used in Rule 434, from the
Prospectus included in the Registration Statement at the time of its
effectiveness or an effective post-effective amendment thereto (including such
information that is permitted to be omitted pursuant to Rule 430A).
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We have been advised by the American Stock Exchange, Inc. that
the Shares are duly authorized for listing, subject to official notice of
issuance.
In addition, we have participated in conferences with officers
and other representatives of the Company, the Operating Partnership and the
other Subsidiaries, and representatives of the Company's independent public
accountants in connection with the preparation of the Registration Statement at
which the contents of the Registration Statement, and the Prospectus therein,
and related matters were reviewed and discussed and, although we have not
verified independently and, therefore, do not assume any responsi bility,
explicitly or implicitly, for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus (except as
provided in paragraph 19 above), on the basis of the foregoing, nothing has come
to our attention that has caused us to believe that the Registration Statement,
at the time the Registration Statement became effective, contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or
that Prospectus or any amendment or supplement thereto, as of their respective
dates, and as of the date hereof, as the case may be, contained any untrue
statement of a material fact or omitted 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 (it being understood that no opinion shall
be expressed with respect to the financial statements and the notes thereto and
the schedules and other financial and statistical data included in the
Registration Statement or the Prospectus).
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Exhibit 9(e)
Tax Opinion of Xxxxxx Xxxxxxxx LLP
