EXHIBIT 1.1
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KEYSTONE PROPERTY TRUST
(a Maryland statutory real estate investment trust)
2,400,000 Shares of 9.125% Series D Cumulative Redeemable Preferred Stock
UNDERWRITING AGREEMENT
Dated: February 12, 2003
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TABLE OF CONTENTS
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(d) Denominations; Registration....................................................................14
SECTION 3. Covenants of the Company.......................................................................15
(a) Compliance with Securities Regulations and Commission Requests.................................15
(b) Filing of Amendments...........................................................................15
(c) Delivery of Registration Statements............................................................15
(d) Delivery of Prospectuses.......................................................................16
(e) Continued Compliance with Securities Laws......................................................16
(f) Blue Sky Qualifications........................................................................16
(g) Rule 158.......................................................................................16
(h) Reporting Requirements.........................................................................17
(i) Use of Proceeds................................................................................17
(j) REIT Qualification.............................................................................17
(k) Listing........................................................................................17
(l) No Manipulation of Market for Securities.......................................................17
(m) Rule 462(b) Registration Statement.............................................................17
SECTION 4. Payment of Expenses............................................................................17
(a) Expenses.......................................................................................17
(b) Termination of Agreement.......................................................................18
SECTION 5. Conditions of Underwriters' Obligations........................................................18
(a) Effectiveness of Registration Statement........................................................18
(b) Opinions of Counsel for Company................................................................18
(c) Opinion of Counsel for Underwriters............................................................18
(d) Officers' Certificate..........................................................................19
(e) Accountant's Comfort Letter....................................................................19
(f) Bring-down Comfort Letter......................................................................19
(g) Approval of Listing............................................................................19
(h) Conditions to Purchase of Option Securities....................................................20
(i) Officers' Certificate.................................................................20
(ii) Opinion of Counsel for Company........................................................20
(iii) Opinion of Counsel for Underwriters...................................................20
(iv) Bring-down Comfort Letters............................................................20
(i) Additional Documents...........................................................................20
(j) Termination of Agreement.......................................................................20
SECTION 6. Indemnification................................................................................21
(a) Indemnification of Underwriters................................................................21
(b) Indemnification of Company, Trustees and Officers..............................................22
(c) Actions against Parties; Notification..........................................................22
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SECTION 7. Contribution...................................................................................23
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.................................24
SECTION 9. Termination of Agreement.......................................................................24
(a) Termination; General...........................................................................24
(b) Liabilities....................................................................................25
SECTION 10. Default by One or More of the Underwriters.....................................................25
SECTION 11. Notices........................................................................................26
SECTION 12. Parties........................................................................................26
SECTION 13. GOVERNING LAW AND TIME.........................................................................26
SECTION 14. Effect of Headings.............................................................................26
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KEYSTONE PROPERTY TRUST
(a Maryland statutory real estate investment trust)
2,400,000 Shares of 9.125% Series D Cumulative Redeemable Preferred Stock
(Par Value $.001 Per Share)
UNDERWRITING AGREEMENT
February 12, 2003
Bear, Xxxxxxx & Co. Inc.
X.X. Xxxxxxx & Sons, Inc.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
RBC Xxxx Xxxxxxxx Inc.
BB&T Capital Markets, a division of
Xxxxx & Xxxxxxxxxxxx Inc.
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Keystone Property Trust, a Maryland statutory real estate investment trust
(including its predecessor the "Company"), confirms its agreement with Bear,
Xxxxxxx & Co. Inc. ("Bear Xxxxxxx"), X.X. Xxxxxxx & Sons, Inc., Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated, RBC Xxxx Xxxxxxxx Inc. and BB&T Capital
Markets, a division of Xxxxx & Xxxxxxxxxxxx, Inc. (collectively, the
"Underwriters," which term shall also include any underwriter substituted as
hereinafter provided in Section 10 hereof), with respect to the issue and sale
by the Company and the purchase by the Underwriters, acting severally and not
jointly, of 2,400,000 shares of the Company's 9.125% Series D cumulative
redeemable preferred stock, par value $.001 per share, liquidation preference
$25.00 per share (the "Series D Preferred Stock"), and with respect to the grant
by the Company to the Underwriters, acting severally and not jointly, of the
option described in Section 2(b) hereof to purchase all or any part of 360,000
additional shares of Series D Preferred Stock to cover over-allotments, if any.
The aforesaid 2,400,000 shares of Series D Preferred Stock (the "Initial
Securities") to be purchased by the Underwriters and all or any part of the
360,000 shares of Series D Preferred Stock subject to the option described in
Section 2(b) hereof (the "Option Securities") are hereinafter called,
collectively, the "Securities."
The Company understands that the Underwriters propose to make a public
offering of the Securities as soon as the Underwriters deem advisable after this
Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-58971) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this Agreement, the Company will either
(i) prepare and file a prospectus in accordance with the provisions of Rule 430A
("Rule 430A") of the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations"), if applicable, and paragraph (b) of Rule 424
("Rule 424(b)") of the 1933 Act Regulations or (ii) if the Company has elected
to rely upon Rule 434 ("Rule 434") of the 1933 Act Regulations, prepare and file
a term sheet (a "Term Sheet") in accordance with the provisions of Rule 434 and
Rule 424(b). The information included in any such prospectus or in any such Term
Sheet, as the case may be, that was omitted from such registration statement at
the time it became effective but that is deemed to be part of such registration
statement at the time it became effective, if applicable, (a) pursuant to
paragraph (b) of Rule 430A is referred to as "Rule 430A Information" or (b)
pursuant to paragraph (d) of Rule 434 is referred to as "Rule 434 Information."
Each prospectus used before such registration statement became effective, and
any prospectus that omitted, as applicable, the Rule 430A Information or the
Rule 434 Information, that was used after such effectiveness and prior to the
execution and delivery of this Agreement, is herein called a "preliminary
prospectus." Such registration statement, including the exhibits thereto,
schedules thereto, if any, and the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the 1933 Act, at the time it became
effective and including the Rule 430A Information and the Rule 434 Information,
as applicable, is herein called the "Registration Statement." Any registration
statement filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein
referred to as the "Rule 462(b) Registration Statement," and after such filing
the term "Registration Statement" shall include the Rule 462(b) Registration
Statement. The final prospectus, including the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the 1933 Act, in the
form first furnished to the Underwriters for use in connection with the offering
of the Securities is herein called the "Prospectus." If Rule 434 is relied on,
the term "Prospectus" shall refer to the preliminary prospectus together with
the Term Sheet and all references in this Agreement to the date of the
Prospectus shall mean the date of the Term Sheet. For purposes of this
Agreement, all references to the Registration Statement, any preliminary
prospectus, the Prospectus or any Term Sheet or any amendment or supplement to
any of the foregoing shall be deemed to include the copy filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
system ("XXXXX").
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of
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1934, as amended (the "1934 Act"), which is incorporated by reference in the
Registration Statement, such preliminary prospectus or the Prospectus, as the
case may be.
The term "Subsidiary" means a corporation or a partnership a majority of
the outstanding voting stock, partnership or membership interests, as the case
may be, of which is owned or controlled, directly or indirectly, by the Company,
Keystone Operating Partnership, L.P., a Delaware limited partnership (the
"Operating Partnership"), or by one or more other Subsidiaries of the Company or
the Operating Partnership.
SECTION 1. REPRESENTATIONS AND WARRANTIES.
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY AND THE OPERATING
PARTNERSHIP. Each of the Company and the Operating Partnership represents and
warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with each Underwriter, as
follows:
(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. The Company meets
the requirements for use of Form S-3 under the 1933 Act. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective under the 1933 Act and no stop order suspending the effectiveness
of the Registration Statement or any Rule 462(b) Registration Statement has
been issued under the 1933 Act and no proceedings for that purpose have
been instituted or are pending or, to the knowledge of the Company, are
contemplated by the Commission, and any request on the part of the
Commission for additional information has been complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto (including
the filing of the Company's most recent Annual Report on Form 10-K with the
Commission) became effective, at the date of this Agreement and at the
Closing Time (and, if any Option Securities are purchased, at the Date of
Delivery), the Registration Statement, the Rule 462(b) Registration
Statement and any amendments and supplements thereto complied and will
comply in all material respects with the requirements of the 1933 Act and
the 1933 Act Regulations and did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading. Neither the Prospectus nor any amendments or supplements
thereto at the time the Prospectus or any such amendment or supplement was
issued and at the Closing Time (and, if any Option Securities are
purchased, at the Date of Delivery), included or will include an untrue
statement of a material fact or omitted or will omit to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. If Rule 434 is
used, the Company will comply with the requirements of Rule 434. The
representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any Underwriter through Bear Xxxxxxx
expressly for use in the Registration Statement or Prospectus.
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Each preliminary prospectus and the prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriters for
use in connection with this offering was identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX,
except to the extent permitted by Regulation S-T.
If a Rule 462(b) Registration Statement is required in connection with
the offering and sale of the Securities, the Company has complied or will
comply with the requirements of Rule 111 under the 1933 Act Regulations
relating to the payment of filing fees thereof.
(ii) INCORPORATED DOCUMENTS. The documents incorporated or deemed
to be incorporated by reference in the Registration Statement and the
Prospectus, when they became effective or at the time they were or
hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations or 1934 Act and the rules and regulations of the Commission
thereunder (the "1934 Act Regulations"), as applicable, and, when read
together with the other information in the Prospectus, at the time the
Registration Statement became effective, at the time the Prospectus was
issued and at the Closing Time (and, if any Option Securities are
purchased, at the Date of Delivery), did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.
(iii) INDEPENDENT ACCOUNTANTS. The accountants who certified the
financial statements and supporting schedules included in the Registration
Statement are independent public accountants as required by the 1933 Act
and the 1933 Act Regulations.
(iv) FINANCIAL STATEMENTS. The financial statements included in
the Registration Statement and the Prospectus, together with the related
schedules and notes, present fairly the financial position of the Company
and its consolidated subsidiaries at the dates indicated and the statement
of operations, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout the
periods involved. The supporting schedules, if any, included in the
Registration Statement and Prospectus present fairly in accordance with
GAAP the information required to be stated therein. The selected financial
data and the summary financial information included in the Registration
Statement and Prospectus present fairly the information shown therein and
have been compiled on a basis consistent with that of the audited financial
statements included in the Registration Statement and Prospectus. In
addition, any pro forma financial information included in the Registration
Statement and the Prospectus present fairly the information shown therein,
have been prepared in accordance with the Commission's rules and guidelines
with respect to pro forma financial statements and
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have been properly compiled on the bases described therein, and the
assumptions used in preparing the pro forma and as adjusted financial
information included in the Registration Statement and the Prospectus
provide a reasonable basis for presenting the significant effects directly
attributable to the transactions or events described therein, the related
pro forma and as adjusted adjustments give appropriate effect to those
assumptions, and the pro forma and as adjusted columns therein reflect the
proper application of those adjustments to the corresponding historical
financial statement amounts. All historical financial statements and
information and all pro forma financial statements and information relating
to the Company or any entity acquired or to be acquired by the Company
required by the 1933 Act, the 1933 Act Regulations, the 1934 Act and the
1934 Act Regulations are included, or incorporated by reference, in the
Registration Statement and Prospectus. The statistical and market-related
data included in the Registration Statement and the Prospectus are based on
or derived from sources which the Company reasonably and in good faith
believes are reliable and accurate, and such data agrees with the sources
from which they are derived.
(v) RELATED-PARTY TRANSACTIONS. No relationship, direct or
indirect, exists between or among any of the Company or any affiliate of
the Company, on the one hand, and any director, officer, stockholder,
customer or supplier of the Company or any affiliate of the Company, on the
other hand, which is required by the 1933 Act, the 1934 Act, the 1933 Act
Regulations or the 1934 Act Regulations to be described in the Registration
Statement or the Prospectus which is not so described or is not described
as required. There are no outstanding loans, advances (except normal
advances for business expenses in the ordinary course of business) or
guarantees of indebtedness by the Company to or for the benefit of any of
the officers or directors of the Company or any of their respective family
members, except as disclosed in the Registration Statement and the
Prospectus.
(vi) INTERNAL CONTROLS. The Company and its Subsidiaries maintain
a system of internal accounting and other controls sufficient to provide
reasonable assurances that (i) transactions are executed in accordance with
management's general or specific authorizations, (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 accounting for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(vii) NO MATERIAL ADVERSE CHANGE IN BUSINESS. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company, the
Operating Partnership and the Subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business (a "Material
Adverse Effect"), (B) no casualty loss or condemnation or other adverse
event with respect to any of the interests held directly or indirectly in
any of the real properties or real property interests, including without
limitation, any interest or participation, direct or indirect, in any
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mortgage obligation owned, directly or indirectly, by the Company, the
Operating Partnership or any Subsidiary (the "Properties") has occurred
which would be material with respect to the Company, the Operating
Partnership and the Subsidiaries considered as one enterprise, (C) there
have been no transactions entered into by the Company, the Operating
Partnership or any Subsidiary, other than those in the ordinary course of
business, which are material with respect to the Company, the Operating
Partnership and the Subsidiaries considered as one enterprise, (D) except
for regular quarterly dividends on the Company's common shares of
beneficial interest, par value $.001 per share (the "Common Shares"), in
amounts per share that are consistent with past practice, regular quarterly
distributions on the Company's preferred stock, and regular quarterly
distributions on the common and preferred units of the Operating
Partnership (the "Units"), there has been no dividend or distribution of
any kind declared, paid or made by the Company on any class of its capital
stock or any distribution by the Operating Partnership with respect to its
Units, and (E) there has been no increase in long-term debt or decrease in
the capital of the Company, the Operating Partnership or any Subsidiary.
(viii) GOOD STANDING OF THE COMPANY. The Company has been duly
formed and is validly existing as a statutory real estate investment trust
in good standing under Title 8 of the Corporations and Associations Article
of the Annotated Code of Maryland (the "Maryland REIT law") and has trust
power and authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus and to enter into and perform
its obligations under this Agreement; and the Company is duly qualified and
registered as a foreign real estate investment trust and is in good
standing in each jurisdiction in which such qualification or registration
is required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect.
(ix) GOOD STANDING OF THE OPERATING PARTNERSHIP. The Operating
Partnership is duly organized and validly existing as a limited partnership
in good standing under the laws of the State of Delaware, with partnership
power and authority to own, lease and operate its properties, to conduct
the business in which it is engaged and proposes to engage as described in
the Prospectus and to enter into and perform its obligations under this
Agreement. The Operating Partnership is duly qualified or registered as a
foreign partnership and is in good standing in each jurisdiction in which
such qualification or registration is required, whether by reason of the
ownership or leasing of property or the conduct of business, except where
the failure to so qualify or register would not result in a Material
Adverse Effect. The Company is the sole general partner of the Operating
Partnership and holds such number and/or percentage of Units as disclosed
in the Prospectus as of the dates set forth therein. The Amended and
Restated Agreement of Limited Partnership of the Operating Partnership,
dated as of October 13, 1999, as amended through October 23, 2002 (the
"Operating Partnership Agreement"), is in full force and effect.
(x) GOOD STANDING OF SUBSIDIARIES. The Operating Partnership is
the only Subsidiary that is a "significant subsidiary" of the Company (as
such term is defined in Rule 1-02 of Regulation S-X). The only Subsidiaries
of the Company are (a) the Subsidiaries listed on Exhibit 21 to the
Registration Statement and (b) certain other
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Subsidiaries which, considered in the aggregate as a single Subsidiary, do
not constitute a "significant subsidiary" as defined in Rule 1-02 of
Regulation S-X.
(xi) JOINT VENTURES. All of the joint ventures in which the
Company or any Subsidiary owns an interest of greater than five percent and
that are currently conducting business (the "Joint Ventures") are listed on
Schedule C hereto. The Company's (or Subsidiary's, as the case may be)
ownership interest in such Joint Venture is as set forth on Schedule C. To
the knowledge of the Company, each of the Joint Ventures possesses such
certificates, authorizations or permits issued by the appropriate state,
federal or foreign regulatory agencies or bodies necessary to conduct the
business now being conducted by it, as described or incorporated by
reference in the Prospectus, and none of the Joint Ventures has received
notice of any proceedings relating to the revocation or modification of any
such certificate, authority or permit which singly or in the aggregate, if
the subject of an unfavorable ruling or decision, would have a Material
Adverse Effect.
(xii) CAPITALIZATION. As of the date of this Agreement, the
authorized capital stock of the Company consists of 59,200,000 Common
Shares and 5,800,000 preferred shares of beneficial interest, par value
$.001 per share, of which 21,469,951 Common Shares, 600,000 shares of
Series C Convertible Preferred Stock, no shares of Series A Convertible
Preferred Stock and no shares of Series B Convertible Preferred Stock are
issued and outstanding on the date hereof. All issued and outstanding
shares of beneficial interest of the Company have been duly authorized and
validly issued and are fully paid and non-assessable and have been offered
and sold or exchanged by the Company in compliance with all applicable laws
(including, without limitation, federal and state securities laws); none of
the outstanding shares of beneficial interest of the Company were issued in
violation of the preemptive or other similar rights of any securityholder
of the Company.
(xiii) AUTHORIZATION OF UNITS. All issued and outstanding Units have
been duly authorized and are validly issued, fully paid and non-assessable
and have been offered and sold or exchanged by the Operating Partnership in
compliance with all applicable laws (including, without limitation, federal
and state securities laws). Except for (i) any outstanding convertible
preferred units, (ii) a third party interest in Keystone Cranbury West, LLC
that can be exchanged for Units (the "Cranbury Interest") and (iii) units
that may be issued pursuant to the option agreement between the Operating
Partnership and Xxxxxxxx Investments, Inc., dated as of December 4, 1998
(the "Xxxxxxxx Agreement"), there are no Units reserved for any purpose and
there are no outstanding securities convertible into or exchangeable for
any Units and no outstanding options, rights (preemptive or otherwise) or
warrants to purchase or to subscribe for Units.
(xiv) AUTHORIZATION AND DESCRIPTION OF SECURITIES. The Securities
to be purchased by the Underwriters from the Company have been duly
authorized for issuance and sale to the Underwriters pursuant to this
Agreement and, when issued and delivered by the Company pursuant to this
Agreement against payment of the consideration set forth herein, will be
validly issued, fully paid and non-assessable. At or prior to the Closing
Time, the Company will have executed and filed Articles Supplementary
("Articles Supplementary") to the Company's Declaration of Trust
establishing the terms
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of the Securities with the State Department of Assessments and Taxation of
the State of Maryland. The Securities conform to all statements relating
thereto contained in the Prospectus and such description conforms to the
rights set forth in the Articles Supplementary; the certificate evidencing
the Securities will be in substantially the form to be filed or
incorporated by reference, as the case may be, as an exhibit to the
Registration Statement and the form of stock certificate evidencing the
Securities will comply with all applicable legal requirements, with all
applicable requirements of the Company's charter and by-laws and with the
requirements of the
New York Stock Exchange, Inc. (the "NYSE"). No holder
of the Securities will be subject to personal liability by reason of being
such a holder; the issuance of the Securities is not subject to the
preemptive or other similar rights of any securityholder of the Company.
(xv) AUTHORIZATION OF AGREEMENT. This Agreement and the
transactions contemplated herein have been duly authorized by the Company
and the Operating Partnership and this Agreement has been duly executed and
delivered by the Company and the Operating Partnership.
(xvi) ABSENCE OF DEFAULTS AND CONFLICTS. None of the Company, the
Operating Partnership or any Subsidiary is in violation of its declaration
of trust, partnership agreement, charter, by-laws or other governing
instrument ("Governing Instruments") or in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or other agreement or instrument to which the Company, the
Operating Partnership or any Subsidiary is a party or by which it or any of
them may be bound, or to which any of the property or assets of the
Company, the Operating Partnership or any Subsidiary is subject
(collectively, "Agreements and Instruments") except for such violations or
defaults of any Agreements or Instruments that would not result in a
Material Adverse Effect; and the execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated herein
and in the Prospectus (including the issuance and sale of the Securities
and the use of the proceeds from the sale of the Securities as described in
the Prospectus under the caption "Use of Proceeds") and compliance by the
Company and the Operating Partnership with their respective obligations
hereunder have been duly authorized by all necessary requisite action and
do not and will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach of, or
default or Repayment Event (as defined below) under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property
or assets of the Company, the Operating Partnership or any Subsidiary
pursuant to, the Agreements and Instruments (except for such conflicts,
breaches, defaults or Repayment Events or liens, charges or encumbrances
that would not result in a Material Adverse Effect), nor will such action
result in any violation of the provisions of the Governing Instruments of
the Company, the Operating Partnership or any Subsidiary or any applicable
law, statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company, the Operating Partnership or any
Subsidiary or any of their assets, properties or operations, except for
such violations that would not have a Material Adverse Effect. As used
herein, a "Repayment Event" means any event or condition which gives the
holder of any note, debenture or other evidence of
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indebtedness (or any person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a material
portion of such indebtedness by the Company, the Operating Partnership or
any Subsidiary.
(xvii) ABSENCE OF LABOR DISPUTE. No labor dispute with the employees
of the Company, the Operating Partnership or any Subsidiary exists or, to
the knowledge of the Company or the Operating Partnership, is imminent, and
the Company and the Operating Partnership are not aware of any existing or
imminent labor disturbance by the employees of any of its or any
Subsidiary's principal suppliers, manufacturers, customers or contractors,
which, in either case, may reasonably be expected to result in a Material
Adverse Effect.
(xviii) ABSENCE OF PROCEEDINGS. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Company or the Operating Partnership, threatened, against or affecting
the Company, the Operating Partnership or any Subsidiary, which is required
to be disclosed in the Registration Statement (other than as disclosed
therein), or which might reasonably be expected to result in a Material
Adverse Effect or materially adversely affect the consummation of the
transactions contemplated in this Agreement or the performance by the
Company or the Operating Partnership of their respective obligations
hereunder. The aggregate of all pending legal or governmental proceedings
to which the Company, the Operating Partnership or any Subsidiary is a
party or of which any of their respective properties or assets is the
subject which are not described in the Registration Statement, including
ordinary routine litigation could not reasonably be expected to result in a
Material Adverse Effect.
(xix) ACCURACY OF EXHIBITS. There are no contracts or documents
which are required to be described in the Registration Statement, the
Prospectus or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and filed as
required.
(xx) REIT QUALIFICATION. Commencing with its taxable year ended
December 31, 1993, the Company has been, and upon the sale of the
Securities, the Company will continue to be organized and operated in
conformity with the requirements for qualification and taxation as a real
estate investment trust (a "REIT") under the Internal Revenue Code of 1986,
as amended (the "Code"), and the Company's proposed method of operation as
described in the Prospectus will enable it to continue to meet the
requirements for qualification and taxation as a REIT under the Code, and
no actions have been taken (or not taken which are required to be taken)
which would cause such qualification to be lost.
(xxi) INVESTMENT COMPANY ACT. Each of the Company, the Operating
Partnership and any Subsidiary is not, and upon the issuance and sale of
the Securities as herein contemplated and the application of the net
proceeds therefrom as described in the Prospectus will not be, an
"investment company" or an entity "controlled" by an "investment company"
as such terms are defined in the Investment Company Act of 1940, as amended
(the "1940 Act").
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(xxii) POSSESSION OF INTELLECTUAL PROPERTY. The Company, the
Operating Partnership and any Subsidiary own or possess, or can acquire on
reasonable terms, adequate patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other intellectual
property (collectively, "Intellectual Property") necessary to carry on the
business now operated by them, and neither the Company, the Operating
Partnership or any Subsidiary has received any written notice or is
otherwise aware of any infringement of or conflict with asserted rights of
others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company, the Operating
Partnership or any Subsidiary therein, and which infringement or conflict
(if the subject of any unfavorable decision, ruling or finding) or
invalidity or inadequacy, singly or in the aggregate, would result in a
Material Adverse Effect.
(xxiii) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company or the
Operating Partnership of their respective obligations hereunder, in
connection with the offering, issuance or sale of the Securities hereunder
or the consummation of the transactions contemplated by this Agreement,
except such as has already been obtained or as required under such
securities laws or under the rules of the National Association of
Securities Dealers, Inc.
(xxiv) OTHER FEES. Except as disclosed in the Registration Statement
and the Prospectus, there are no contracts, agreements or understandings
between the Company and any person that would give rise to a valid claim
against the Company or any Underwriter for a brokerage commission, finder's
fee or other like payment in connection with the transactions contemplated
by this Agreement, the Registration Statement and the Prospectus or, to the
Company's knowledge, any arrangements, agreements, understandings, payments
or issuance with respect to the Company or any of its officers, directors,
shareholders, partners, employees, Subsidiaries or affiliates that may
affect the Underwriters' compensation as determined by the NASD.
(xxv) POSSESSION OF LICENSES AND PERMITS. Each of the Company, the
Operating Partnership and the Subsidiaries possess such permits, licenses,
approvals, consents and other authorizations (collectively, "Governmental
Licenses") issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to conduct the business now
operated by them except where failure to possess any such Governmental
Licenses would not result in a Material Adverse Event; the Company, the
Operating Partnership and their Subsidiaries are in compliance with the
terms and conditions of all such Governmental Licenses, except where the
failure so to comply would not, singly or in the aggregate, result in a
Material Adverse Effect; all of the Governmental Licenses are valid and in
full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force
and effect would not result in a Material Adverse Effect; and none of the
Company, the Operating Partnership or any of the Subsidiaries has received
any notice of proceedings relating to
10
the revocation or modification of any such Governmental Licenses which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a Material Adverse Effect.
(xxvi) TITLE TO PROPERTY. (A) The Company, the Operating
Partnership, the Subsidiaries or any joint ventures in which the Company,
the Operating Partnership or any Subsidiary owns an interest, as the case
may be, have good and marketable fee simple title or leasehold title, as
the case may be, to all real property owned or leased, as applicable, by
the Company, the Operating Partnership, the Subsidiaries or the applicable
joint venture, respectively, and good title to all other properties owned
by them, and any improvements thereon and all other assets that are
required for the operation of such properties in the manner in which they
currently are operated, free and clear of all liens, encumbrances, claims,
security interests and defects, except such as are Permitted Encumbrances
(as defined below); (B) all material liens, charges, encumbrances, claims
or restrictions on or affecting any of the Properties and the assets of any
of the Company, the Operating Partnership, the Subsidiaries or any joint
venture in which the Company, the Operating Partnership or any Subsidiary
owns an interest that are required to be disclosed in the Prospectus are
disclosed therein; (C) each of the Properties complies with all applicable
codes, laws and regulations (including, without limitation, building and
zoning codes, laws and regulations and laws relating to access to the
Properties), except if and to the extent disclosed in the Prospectus and
except for such failures to comply that would not in the aggregate have a
Material Adverse Effect; (D) there are in effect for the assets of each of
the Company, the Operating Partnership, the Subsidiaries or any joint
venture in which the Company, the Operating Partnership or any Subsidiary
owns an interest, insurance policies covering the risks and in amounts that
are commercially reasonable for the types of assets owned by them and that
are consistent with the types and amounts of insurance typically maintained
by prudent owners of properties similar to such assets in the markets in
which such assets are located, and none of the Company, the Operating
Partnership, the Subsidiaries or any joint venture in which the Company,
the Operating Partnership or any Subsidiary owns an interest has received
from any insurance company notice of any material defects or deficiencies
affecting the insurability of any such assets or any notices of
cancellation or intent to cancel any such policies; and (E) neither the
Company nor the Operating Partnership has any knowledge of any pending or
threatened, litigation, moratorium, condemnation proceedings, zoning
change, or other similar proceeding or action that could in any manner
affect the size of, use of, improvements on, construction on, access to or
availability of utilities or other necessary services to the Properties,
except such proceedings or actions that would not have a Material Adverse
Effect. All of the leases and subleases material to the business of the
Company, the Operating Partnership and the Subsidiaries considered as one
enterprise, and under which the Company, the Operating Partnership or any
Subsidiary holds Properties described in the Prospectus, are in full force
and effect, and none of the Company, the Operating Partnership or any
Subsidiary has received any notice of any material claim of any sort that
has been asserted by anyone adverse to the rights of the Company, the
Operating Partnership or any Subsidiary under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the
Company, the Operating Partnership or any Subsidiary of the continued
possession of the leased or subleased premises under any such lease or
sublease. "Permitted Encumbrance" shall
11
mean (a) liens on Properties securing any of the Company, the Operating
Partnership, any Subsidiary or joint venture obligations, (b) other liens
which are expressly described in, or which are incorporated by reference
into, the Prospectus and (c) customary easements and encumbrances and other
exceptions to title which do not materially impair the operation,
development or use of the Properties for the purposes intended therefor as
contemplated in the Prospectus.
(xxvii) ENVIRONMENTAL LAWS. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, result in a
Material Adverse Effect, to the knowledge of the Company, the Operating
Partnership and any Subsidiary, as the case may be (A) none of the Company,
the Operating Partnership or any of the Subsidiaries is in violation of any
federal, state, local or foreign statute, law, rule, regulation, ordinance,
code, policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative order,
consent, decree or judgment, relating to pollution or protection of human
health, the environment (including, without limitation, ambient air,
surface water, groundwater, land surface or subsurface strata) or wildlife,
including, without limitation, laws and regulations relating to the release
or threatened release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, "Environmental Laws"), (B) the Company,
the Operating Partnership and the Subsidiaries have all permits,
authorizations and approvals required under any applicable Environmental
Laws and are each in compliance with their requirements, (C) there are no
pending or threatened administrative, regulatory or judicial actions,
suits, demands, demand letters, claims, liens, notices of noncompliance or
violations, investigations or proceedings relating to any Environmental Law
against the Company, the Operating Partnership or any of the Subsidiaries
and (D) there are no events or circumstances that might reasonably be
expected to form the basis of an order for clean-up or remediation, or an
action, suit or proceeding by any private party or governmental body or
agency, against or affecting the Company, the Operating Partnership or any
of the Subsidiaries relating to Hazardous Materials or any Environmental
Laws.
(xxviii) TAX RETURNS. The Company, the Operating Partnership and any
Subsidiary, as the case may be, have filed all federal, state, local and
foreign income tax returns which have been required to be filed (except in
any case in which an extension has been granted or the failure to so file
would not result in a Material Adverse Effect) and has paid all taxes
required to be paid and any other assessment, fine or penalty levied
against it, to the extent that any of the foregoing is due and payable,
except, in all cases, for any such tax, assessment, fine or penalty that is
being contested in good faith.
(xxix) ENVIRONMENTAL CONSULTANTS. None of the environmental
consultants which prepared environmental and asbestos inspection reports
with respect to the Properties was employed for such purpose on a
contingent basis or has any substantial interest in the Company, the
Operating Partnership or any Subsidiary and none of them nor any of their
directors, officers or employees is connected with the Company, the
Operating
12
Partnership or any Subsidiary as a promoter, selling agent, trustee,
director, officer or employee.
(xxx) TITLE INSURANCE. The Company, the Operating Partnership and
any Subsidiary, as the case may be, have obtained title insurance on the
fee interests and leasehold interests in each of the Properties in an
amount at least equal to the greater of (A) the mortgage indebtedness on
each such Property or (B) the purchase price paid for each such Property
(in the case of any Property having been acquired by the Operating
Partnership via an exchange of Units for ownership interests in the entity
holding such property, the "purchase price" of such Property being deemed
to be the sum of (i) the per-share price of the Common Shares of the
Company on the date such interests were exchanged for Units multiplied by
the number of Units exchanged for such interests in the entity holding such
Property and (ii) the amount of any assumed indebtedness secured by such
Property).
(xxxi) ABSENCE OF REGULATION M VIOLATION. None of the Company, the
Operating Partnership, the Subsidiaries, nor any of their respective
trustees, directors, officers, affiliates, members or controlling persons,
has taken or will take, directly or indirectly, any action resulting in a
violation of Regulation M under the 1934 Act, or designed to cause or
result in, or that has constituted or that reasonably might be expected to
constitute, the stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the Securities.
(xxxii) REGISTRATION RIGHTS. There are no persons with registration
rights or other similar rights to have any securities registered pursuant
to the Registration Statement.
(b) OFFICER'S CERTIFICATES. Any certificate signed by any officer of the
Company, or any authorized representative of the Operating Partnership or any of
their subsidiaries delivered to the Underwriters or to counsel for the
Underwriters shall be deemed a representation and warranty by such person or
entity, as the case may be, to each Underwriter as to the matters covered
thereby.
SECTION 2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING.
(a) INITIAL SECURITIES. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Company, at
the price per share set forth in SCHEDULE B, the number of Initial Securities
set forth in SCHEDULE A opposite the name of such Underwriter, plus any
additional number of Initial Securities which such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof.
(b) OPTION SECURITIES. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the Underwriters, severally
and not jointly, to purchase up to an additional 360,000 shares of Series D
Preferred Stock in the aggregate at the price per share set forth in SCHEDULE B,
less an amount per share equal to any dividends or distributions declared by the
13
Company and payable on the Initial Securities but not payable on the Option
Securities. The option hereby granted will expire 30 days after the date hereof
and may be exercised in whole or in part from time to time only for the purpose
of covering over-allotments which may be made in connection with the offering
and distribution of the Initial Securities upon notice by the Underwriters to
the Company setting forth the number of Option Securities as to which the
several Underwriters are then exercising the option and the time and date of
payment and delivery for such Option Securities. Any such time and date of
delivery (a "Date of Delivery") shall be determined by the Underwriters, but
shall not be later than seven full business days after the exercise of said
option, nor in any event prior to the Closing Time, as hereinafter defined. If
the option is exercised as to all or any portion of the Option Securities, each
of the Underwriters, severally and not jointly, will purchase that proportion of
the total number of Option Securities then being purchased which the number of
Initial Securities each such Underwriter has severally agreed to purchase as set
forth in SCHEDULE A bears to the total number of Initial Securities, subject to
such adjustments as Bear Xxxxxxx in its discretion shall make to eliminate any
sales or purchases of a fractional number of Option Securities.
(c) PAYMENT. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
Xxxxxxxx Chance, or at such other place as shall be agreed upon by the
Underwriters and the Company, at 10:00 A.M. (Eastern time) on the third (fourth,
if the pricing occurs after 4:30 P.M. (Eastern time) on any given day) business
day after the date hereof (unless postponed in accordance with the provisions of
Section 10), or such other time not later than ten business days after such date
as shall be agreed upon by the Underwriters and the Company (such time and date
of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Underwriters and
the Company, on each Date of Delivery as specified in the notice from the
Underwriters to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Underwriters for the respective accounts of the Underwriters of certificates
for the Securities to be purchased by them. It is understood that each
Underwriter has authorized the Underwriters, for its account, to accept delivery
of, receipt for, and make payment of the purchase price for, the Initial
Securities and the Option Securities, if any, which it has agreed to purchase.
Bear Xxxxxxx, individually and not as representative of the Underwriters, may
(but shall not be obligated to) make payment of the purchase price for the
Initial Securities or the Option Securities, if any, to be purchased by any
Underwriter whose funds have not been received by the Closing Time or the
relevant Date of Delivery, as the case may be, but such payment shall not
relieve such Underwriter from its obligations hereunder.
(d) DENOMINATIONS; REGISTRATION. Certificates for the Initial Securities
and the Option Securities, if any, shall be in such denominations and registered
in such names as the Underwriters may request in writing at least one full
business day before the Closing Time or the relevant Date of Delivery, as the
case may be. The certificates for the Initial Securities and the
14
Option Securities, if any, will be made available for examination and packaging
by the Underwriters in The City of
New York not later than 10:00 A.M. (Eastern
time) on the business day prior to the Closing Time or the relevant Date of
Delivery, as the case may be.
SECTION 3. COVENANTS OF THE COMPANY. Each of the Company and the Operating
Partnership covenants with each Underwriter as follows:
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
or Rule 434, as applicable, and will notify the Underwriters immediately, and
confirm the notice in writing, (i) when any post-effective amendment to the
Registration Statement shall become effective, or any supplement to the
Prospectus or any amended Prospectus shall have been filed, (ii) of the receipt
of any comments from the Commission, (iii) of any request by the Commission for
any amendment to the Registration Statement or any amendment or supplement to
the Prospectus or for additional information, and (iv) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of any order preventing or suspending the use of any preliminary
prospectus, or of the suspension of the qualification of the Securities for
offering or sale in any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes. The Company will promptly effect the
filings necessary pursuant to Rule 424(b) and will take such steps as it deems
necessary to ascertain promptly whether the form of prospectus transmitted for
filing under Rule 424(b) was received for filing by the Commission and, in the
event that it was not, it will promptly file such prospectus. The Company will
make every reasonable effort to prevent the issuance of any stop order and, if
any stop order is issued, to obtain the lifting thereof at the earliest possible
moment.
(b) FILING OF AMENDMENTS. During the period a Prospectus is required to be
delivered under the 1933 Act, the Company will give the Underwriters notice of
its intention to file or prepare any amendment to the Registration Statement
(including any filing under Rule 462(b)), any Term Sheet or any amendment,
supplement or revision to either the prospectus included in the Registration
Statement at the time it became effective or to the Prospectus, whether pursuant
to the 1933 Act, the 1934 Act or otherwise, will furnish the Underwriters with
copies of any such documents a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file or use any such document to
which the Underwriters or counsel for the Underwriters shall object.
(c) DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished or will
deliver to the Underwriters and counsel for the Underwriters, without charge,
one signed copy of the Registration Statement as originally filed and of each
amendment thereto (including conformed copies of exhibits filed therewith or
incorporated by reference therein and documents incorporated or deemed to be
incorporated by reference therein) and signed copies of all consents and
certificates of experts, and will also deliver to the Underwriters, without
charge, a conformed copy of the Registration Statement as originally filed and
of each amendment thereto (without exhibits) for each of the Underwriters. The
copies of the Registration Statement and each amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
15
(d) DELIVERY OF PROSPECTUSES. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, such
number of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any amendments or
supplements thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the Securities
as contemplated in this Agreement and in the Prospectus. If at any time when a
prospectus is required by the 1933 Act to be delivered in connection with sales
of the Securities, any event shall occur or condition shall exist as a result of
which it is necessary, in the opinion of counsel for the Underwriters or for the
Company, to amend the Registration Statement or amend or supplement the
Prospectus in order that the Prospectus will not include any untrue statements
of a material fact or omit to state a material fact necessary in order to make
the statements therein not misleading in the light of the circumstances existing
at the time it is delivered to a purchaser, or if it shall be necessary, in the
opinion of such counsel, at any such time to amend the Registration Statement or
amend or supplement the Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and
file with the Commission, subject to Section 3(b), such amendment or supplement
as may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements, and the
Company will furnish to the Underwriters such number of copies of such amendment
or supplement as the Underwriters may reasonably request.
(f) BLUE SKY QUALIFICATIONS. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Securities for offering and
sale under the applicable securities laws of such states and other jurisdictions
(domestic or foreign) as the Underwriters may designate and to maintain such
qualifications in effect for a period of not less than one year from the later
of the effective date of the Registration Statement and any Rule 462(b)
Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration Statement and any Rule
462(b) Registration Statement.
(g) RULE 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
16
(h) REPORTING REQUIREMENTS. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
(i) USE OF PROCEEDS. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus under
"Use of Proceeds."
(j) REIT QUALIFICATION. The Company will use its best efforts to continue
to meet the requirement to qualify as a "real estate investment trust" under the
Code for each of its taxable years for so long as the board of trustees deems it
in the best interests of the Company's shareholders to remain so qualified.
(k) LISTING. The Company will use its best efforts to effect the listing
of the Securities on the
New York Stock Exchange.
(l) NO MANIPULATION OF MARKET FOR SECURITIES. Except for the authorization
of actions permitted to be taken by the Underwriters as contemplated herein or
in the Prospectus, neither the Company nor the Operating Partnership will (a)
take, directly or indirectly, any action designed to cause or to result in, or
that might reasonably be expected to constitute, the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Securities, and (b) until the Closing Date, or the Date of
Delivery, if any, (i) sell, bid for or purchase the Securities or pay any person
any compensation for soliciting purchases of the Securities or (ii) pay or agree
to pay to any person any compensation for soliciting another to purchase any
other securities of the Company.
(m) RULE 462(b) REGISTRATION STATEMENT. If the Company elects to rely upon
Rule 462(b), the Company shall file a Rule 462(b) Registration Statement with
the Commission in compliance with Rule 462(b) by 10:00 P.M., Washington, D.C.
time, on the date of this Agreement, and the Company shall at the time of filing
either pay to the Commission the filing fee for the Rule 462(b) Registration
Statement or give irrevocable instructions for the payment of such fee pursuant
to Rule 111(b) under the 1933 Act.
SECTION 4. PAYMENT OF EXPENSES.
(a) EXPENSES. The Company and the Operating Partnership will pay or cause
to be paid all expenses incident to the performance of their obligations under
this Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of this Agreement, any Agreement among
Underwriters, and such other documents as may be required in connection with the
offering, purchase, sale, issuance or delivery of the Securities, (iii) the
preparation, issuance and delivery of the certificates for the Securities to the
Underwriters, including any stock or other transfer taxes and any stamp or other
duties payable upon the sale, issuance or delivery of the Securities to the
Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements
17
of counsel for the Underwriters in connection therewith and in connection with
the preparation of the Blue Sky Survey and any supplement thereto, (vi) the
printing and delivery to the Underwriters of copies of each of the preliminary
prospectus, Prospectus and any amendments or supplements thereto, (vii) the fees
and expenses of any transfer agent or registrar for the Securities and (ix) the
fees and expenses incurred in connection with the listing of the Securities on
the
New York Stock Exchange.
(b) TERMINATION OF AGREEMENT. If this Agreement is terminated by the
Underwriters in accordance with the provisions of Section 5 or Section 9(a)(i)
or (iii) (with respect to the first clause only), the Company shall reimburse
the Underwriters for all of their out-of-pocket expenses, including the
reasonable fees and disbursements of counsel for the Underwriters.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the
several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Operating Partnership
contained in Section 1 hereof or in certificates of any officer or authorized
representative of the Company or the Operating Partnership delivered pursuant to
the provisions hereof, to the performance by the Company or the Operating
Partnership of its covenants and other obligations hereunder, and to the
following further conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the Underwriters. A prospectus containing
the Rule 430A Information shall have been filed with the Commission in
accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon Rule 434,
a Term Sheet shall have been filed with the Commission in accordance with Rule
424(b).
(b) OPINIONS OF COUNSEL FOR COMPANY. At Closing Time, the Underwriters
shall have received the favorable opinions, dated as of Closing Time, of
Xxxxxxxx Chance US LLP and Xxxxx Xxxxxxx LLP, each counsel for the Company and
the Operating Partnership, in form and substance satisfactory to counsel for the
Underwriters, to the effect set forth in EXHIBIT A hereto and to such further
effect as counsel to the Underwriters may reasonably request.
(c) OPINION OF COUNSEL FOR UNDERWRITERS. At Closing Time, the Underwriters
shall have received the favorable opinion, dated as of Closing Time, of Sidley
Xxxxxx Xxxxx & Xxxx LLP, counsel for the Underwriters, with respect to the
matters set forth in clauses (i) (with respect to the first sentence only), (iv)
(with respect to the second sentence solely as to preemptive or other similar
rights arising by operation of law or under the charter or by-laws of the
Company), (vii), (viii), (xii) (solely as to the information in the Prospectus
under "Description of Series D Preferred Stock"), the first paragraph following
(xx) and the last paragraph of EXHIBIT A hereto. In giving such opinion such
counsel may rely, as to all matters governed by the laws of jurisdictions other
than the law of the State of
New York and the federal law of the United States,
18
upon the opinions of counsel satisfactory to the Underwriters. Such counsel may
also state that, insofar as such opinion involves factual matters, they have
relied, to the extent they deem proper, upon certificates of officers of the
Company, the Operating Partnership and the Subsidiaries and certificates of
public officials.
(d) OFFICERS' CERTIFICATE. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of the
Company, the Operating Partnership, and the Subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, and the
Underwriters shall have received a certificate of the President or a Vice
President of the Company, on behalf of the Company and as general partner of the
Operating Partnership, and of the chief financial or chief accounting officer of
the Company, on behalf of the Company and as general partner of the Operating
Partnership, dated as of Closing Time, to the effect that (i) there has been no
such material adverse change, (ii) the representations and warranties in Section
1(a) hereof are true and correct with the same force and effect as though
expressly made at and as of Closing Time, (iii) each of the Company and the
Operating Partnership has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to Closing Time,
and (iv) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are pending or are contemplated by the Commission. In addition, at
Closing Time, the Underwriters shall have received a certificate of the chief
executive officer and chief financial officer of the Company, on behalf of the
Company and as general partner of the Operating Partnership, to the effect as
counsel to the Underwriters may reasonably request.
(e) ACCOUNTANT'S COMFORT LETTER. (i) At the time of execution of this
Agreement, the Underwriters shall have received from KPMG LLP a letter dated
such date, in form and substance satisfactory to the Underwriters, containing
statements and information of the type ordinarily included in accountants'
"comfort letters" to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement and the
Prospectus.
(ii) At the time of execution of this Agreement, the Underwriters
shall have received from Ernst & Young LLP a letter dated such date, in form and
substance satisfactory to the Underwriters, containing statements and
information of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained in the Registration Statement and the Prospectus.
(f) BRING-DOWN COMFORT LETTER. (i) At Closing Time, the Underwriters shall
have received from KPMG LLP a letter, dated as of Closing Time, to the effect
that they reaffirm statements made in the letter furnished pursuant to
subsection (e) of this Section 5, except that the "specified date" referred to
shall be a date not more than three days prior to the Closing Time.
(g) APPROVAL OF LISTING. At Closing Time, the Securities shall have been
approved for listing on the
New York Stock Exchange, subject only to official
notice of issuance.
19
(h) CONDITIONS TO PURCHASE OF OPTION SECURITIES. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to purchase
all or any portion of the Option Securities, the representations and warranties
of the Company and the Operating Partnership contained herein and the statements
in any certificates furnished by the Company, the Operating Partnership and any
Subsidiary shall be true and correct as of each Date of Delivery and, at the
relevant Date of Delivery, the Underwriters shall have received:
(i) OFFICERS' CERTIFICATE. A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company, and of the
chief financial or chief accounting officer of the Company, confirming that
the certificate delivered at the Closing Time pursuant to Section 5(d)
hereof remains true and correct as of such Date of Delivery.
(ii) OPINION OF COUNSEL FOR COMPANY. The favorable opinions of
Xxxxxxxx Chance US LLP and Xxxxx Xxxxxxx LLP, each counsel for the Company
and the Operating Partnership, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery, relating to the
Option Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinions required by Section 5(b) hereof.
(iii) OPINION OF COUNSEL FOR UNDERWRITERS. The favorable opinion of
Sidley Xxxxxx Xxxxx & Xxxx LLP, counsel for the Underwriters, dated such
Date of Delivery, relating to the Option Securities to be purchased on such
Date of Delivery and otherwise to the same effect as the opinion required
by Section 5(c) hereof.
(iv) BRING-DOWN COMFORT LETTER. Letter from KPMG LLP, in form and
substance satisfactory to the Underwriters and dated such Date of Delivery,
substantially in the same form and substance as the letter furnished to the
Underwriters pursuant to Section 5(f)(i) hereof, except that the "specified
date" in each letter furnished pursuant to this paragraph shall be a date
not more than three days prior to such Date of Delivery.
(i) ADDITIONAL DOCUMENTS. At Closing Time and at each Date of Delivery
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may require for the purpose of enabling them to pass upon the
issuance and sale of the Securities as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Securities
as herein contemplated shall be reasonably satisfactory in form and substance to
the Underwriters and counsel for the Underwriters.
(j) TERMINATION OF AGREEMENT. If any condition specified in this Section 5
shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option Securities
on a Date of Delivery which is after the Closing Time, the obligations of the
several Underwriters to purchase the relevant Option Securities, may be
terminated by the Underwriters by notice to the Company at any time at or prior
to Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without
20
liability of any party to any other party except as provided in Section 4 and
except that Sections 1, 6, 7, 8 and 13 shall survive any such termination and
remain in full force and effect.
SECTION 6. INDEMNIFICATION.
(a) INDEMNIFICATION OF UNDERWRITERS. Each of the Company and the Operating
Partnership agrees, jointly and severally, to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, and any
director, officer, employee or affiliate thereof as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A Information
and the Rule 434 Information, if applicable, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact
included in any preliminary prospectus or the Prospectus (or any amendment
or supplement thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. The
foregoing indemnity agreement with respect to any preliminary prospectus
shall not inure to the benefit of any Underwriter who failed to deliver a
Prospectus (as then amended or supplemented, provided by the Company to the
several Underwriters in accordance with Section 3(d)) to the person
asserting any losses, claims, damages and liabilities and judgments caused
by any untrue statement or alleged untrue statement of a material fact
contained in any preliminary prospectus, or caused by 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, if such
material misstatement or omission or alleged material misstatement or
omission was cured, as determined by a court of competent jurisdiction in a
decision not subject to further appeal, in such Prospectus and such
Prospectus was required by law to be delivered at or prior to the written
confirmation of sale to such person.
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid
in settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided any such settlement is
effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Bear Xxxxxxx),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue
21
statement or omission, to the extent that any such expense is not paid
under (i) or (ii) above;
PROVIDED, HOWEVER, that this indemnity agreement shall not apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through Bear Xxxxxxx expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto).
(b) INDEMNIFICATION OF COMPANY, TRUSTEES AND OFFICERS. Each Underwriter
severally agrees to indemnify and hold harmless the Company and the Operating
Partnership, each person, if any, who controls the Company within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act, and any officer,
director, trustee, employee or affiliate thereof, against any and all loss,
liability, claim, damage and expense described in the indemnity contained in
subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company by such Underwriter through Bear Xxxxxxx expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the Prospectus (or any amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Bear Xxxxxxx, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless (x) such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all
22
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party and (y) the
indemnifying party confirms in writing its indemnification obligations hereunder
with respect to such settlement, compromise or judgment.
SECTION 7. CONTRIBUTION. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Operating Partnership on the one hand and the Underwriters on the other hand
from the offering of the Securities pursuant to this Agreement or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company and the
Operating Partnership on the one hand and of the Underwriters on the other hand
in connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company and the Operating Partnership
on the one hand and the Underwriters on the other hand in connection with the
offering of the Securities pursuant to this Agreement shall be deemed to be in
the same respective proportions as the total net proceeds from the offering of
the Securities pursuant to this Agreement (before deducting expenses) received
by the Company and the total underwriting discount received by the Underwriters,
in each case as set forth on the cover of the Prospectus, or, if Rule 434 is
used, the corresponding location on the Term Sheet bear to the aggregate initial
public offering price of the Securities as set forth on such cover.
The relative fault of the Company and the Operating Partnership on the one
hand and the Underwriters on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or the Operating Partnership or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The Company, the Operating Partnership and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this Section
7. The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 7 shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
23
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each trustee of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company, subject in each case to the
preceding two paragraphs. The Underwriters' respective obligations to contribute
pursuant to this Section 7 are several in proportion to the number of Initial
Securities set forth opposite their respective names in SCHEDULE A hereto and
not joint. For purposes of this Section 7, the Company and the Operating
Partnership shall be deemed one party, jointly and severally liable for any
obligations hereunder.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
All representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or the Operating Partnership submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or controlling
person, or by or on behalf of the Company or the Operating Partnership, and
shall survive delivery of the Securities to the Underwriters.
SECTION 9. TERMINATION OF AGREEMENT.
(a) TERMINATION; GENERAL. The Underwriters may terminate this Agreement,
by notice to the Company, at any time at or prior to Closing Time (i) if there
has been, since the time of execution of this Agreement or since the respective
dates as of which information is given in the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company, the Operating Partnership and any
of the Subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there has occurred any material adverse
change in the financial markets in the United States, any outbreak of
hostilities or escalation thereof, any acts of terrorism involving the United
States or other calamity or crisis or any change or development involving a
prospective change in national or international political, financial or economic
conditions, in each case the effect of which is such as to make it, in the
judgment of the Underwriters, impracticable to market the Securities or
inadvisable to enforce contracts for the sale of the Securities, or (iii) if
trading in any securities of the Company has been suspended or materially
limited by the Commission or the
New York Stock Exchange, or if trading
generally on the American Stock Exchange or the
New York Stock Exchange or in
the Nasdaq National Market has been suspended or materially limited, or minimum
or maximum prices for trading
24
have been fixed, or maximum ranges for prices have been required, by any of said
exchanges or by such system or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other governmental authority, or
a material disruption has occurred in commercial banking or securities
settlement or clearance services in the United States, or (iv) if a banking
moratorium has been declared by either Federal or
New York authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7, 8 and 13 shall survive such termination and remain in full force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one or more of
the Underwriters shall fail at Closing Time or a Date of Delivery to purchase
the Securities which it or they are obligated to purchase under this Agreement
(the "Defaulted Securities"), the Underwriters shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Underwriters shall not have completed
such arrangements within such 24-hour period, then:
(i) if the number of Defaulted Securities does not exceed 10% of
the number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not jointly,
to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(ii) if the number of Defaulted Securities exceeds 10% of the
number of Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the Underwriters to purchase and of the Company to sell the
Option Securities to be purchased and sold on such Date of Delivery, shall
terminate without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after the Closing
Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Company to sell the relevant Option Securities,
as the case may be, either the (i) Underwriters or (ii) the Company shall have
the right to postpone Closing Time or the relevant Date of Delivery, as the case
may be, for a period not exceeding seven days in order to effect any required
changes in the Registration Statement or Prospectus or in any other documents or
arrangements. As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 10.
25
SECTION 11. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Underwriters at c/o Bear, Xxxxxxx & Co.
Inc., 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, attention of Equity Capital
Markets; notices to the Company and the Operating Partnership shall be directed
to it at 000 Xxxx Xxxxx Xxxxxxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxxxxxxxxxx, XX
00000, attention of General Counsel.
SECTION 12. PARTIES. This Agreement shall inure to the benefit of and be
binding upon the Underwriters, the Company and the Operating Partnership and
their respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriters, the Company and the Operating Partnership and their
respective successors and the controlling persons and officers, trustees and
directors referred to in Sections 6 and 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the Underwriters and the Company and their respective
successors, and said controlling persons and officers, trustees and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Securities from any Underwriter
shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE. UNLESS OTHERWISE EXPLICITLY
PROVIDED, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. EFFECT OF HEADINGS. The Article and Section headings herein and
the Table of Contents are for convenience only and shall not affect the
construction hereof.
26
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the Underwriters, the Company and the Operating Partnership in accordance with
its terms.
Very truly yours,
KEYSTONE PROPERTY TRUST
By: /s/ Xxxx X. Xxxxx
----------------------------------------
Name: Xxxx X. Xxxxx
Title: Senior Vice President and Secretary
KEYSTONE OPERATING PARTNERSHIP, L.P.
By:
Keystone Property Trust, its general partner
By: /s/ Xxxx X. Xxxxx
----------------------------------------
Name: Xxxx X. Xxxxx
Title: Senior Vice President and Secretary
CONFIRMED AND ACCEPTED,
as of the date first above written:
BEAR, XXXXXXX & CO. INC.
X.X. XXXXXXX & SONS, INC.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
RBC XXXX XXXXXXXX INC.
BB&T CAPITAL MARKETS, A DIVISION OF
XXXXX & XXXXXXXXXXXX INC.
By: Bear, Xxxxxxx & Co. Inc.
By: /s/ Xxxxx X'Xxxxxx
----------------------------------
Authorized Signatory
On behalf of itself and the other
Underwriters named in Schedule I hereto.
27
SCHEDULE A
Number of
Name of Underwriter Initial Securities
----------------------------------------------------- ----------------------
Bear, Xxxxxxx & Co Inc............................... 570,000
X.X. Xxxxxxx & Sons, Inc............................. 570,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated... 570,000
RBC Xxxx Xxxxxxxx Inc. .............................. 570,000
BB&T Capital Markets, Inc. a division of
Xxxxx & Xxxxxxxxxxxx Inc. ........................... 120,000
Total......................................... 2,400,000
=========
Sch A - 1
SCHEDULE B
KEYSTONE PROPERTY TRUST
2,400,000 Shares of 9.125% Series D Cumulative Redeemable Preferred Stock
(Par Value $.001 Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $25.00.
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be $24.2125, being an amount equal to the initial
public offering price set forth above less $0.7875 per share; provided that the
purchase price per share for any Option Securities purchased upon the exercise
of the over-allotment option described in Section 2(b) shall be reduced by an
amount per share equal to any dividends or distributions declared by the Company
and payable on the Initial Securities but not payable on the Option Securities.
Sch B - 1
SCHEDULE C
Joint Venture Ownership Interest
------------- ------------------
Keystone New Jersey Associates, LLC 20%
4 Points Associates, LLC 50%
Sch C - 1
EXHIBIT A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
(i) The Company has been duly organized and is validly existing as a
statutory real estate investment trust under Maryland REIT Law and is in good
standing with the State Department of Assessment and Taxation of Maryland. The
Company has the trust power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus and the
Company's declaration of trust and to enter into and perform its obligations
under the
Underwriting Agreement, and is duly qualified or registered as a
foreign real estate investment trust to transact business and is in good
standing in each jurisdiction identified in SCHEDULE 1 to our opinion.
(ii) All of the outstanding 21,469,951 common shares of beneficial
interest of the Company and 600,000 shares of Series C convertible preferred
stock have been duly authorized; all such issued and outstanding shares of
beneficial interest of the Company are validly issued, fully paid and
non-assessable and conform, in all material respects, to the description thereof
contained in the Prospectus; to our knowledge, no shares of beneficial interest
of the Company are reserved for any purpose except as described in the
Prospectus and for common shares of beneficial interest reserved for issuance in
connection with the (i) conversion of the Preferred Stock, (ii) the conversion
or exchange of Units and (iii) the exercise of Options issued under the Plans.
To our knowledge and except for the Company's outstanding series of Preferred
Stock, the Units or Options issued under the Plans, there are no outstanding
securities convertible into or exchangeable for any shares of beneficial
interest of the Company and no outstanding preemptive or other similar rights to
purchase or subscribe for such shares of beneficial interest or any other
securities of the Company arising under Maryland REIT Law or under the
declaration of trust or by-laws of the Company or any contracts to which the
Company is a party of which we are aware.
(iii) All of the outstanding 27,013,705 common units, 800,000 Series A
Convertible Preferred Units, 1,664,965 Series C Convertible Preferred Units,
450,700 Series D Convertible Preferred Units and 800,000 Series F Convertible
Preferred Units have been duly authorized by the Operating Partnership and,
assuming that the holders of Units, as limited partners of the Operating
Partnership, do not participate in the control of the business of the Operating
Partnership, the Units represent valid and, subject to the qualifications set
forth herein, fully paid and nonassessable limited partner interests in the
Operating Partnership as to which the limited partners holding Units, in their
capacity as limited partners of the Operating Partnership, have no liability in
excess of their obligations to make contributions to the Operating Partnership,
their obligations to make other payments provided for in the Operating
Partnership Agreement and their share of the Operating Partnership's assets and
undistributed profits (subject to the obligation of a limited partner of the
Operating Partnership to repay any funds wrongfully distributed to it). To our
knowledge, except as described in the Prospectus and except for common units
exchangeable or convertible for preferred units and the Cranbury Interest, no
Units are reserved for any purpose, there are no outstanding securities
convertible into or exchangeable for any Units and there are no preemptive or
other similar rights purchase or subscribe for Units or any other securities of
the Operating Partnership arising under the
DRULPA (as defined below) or under the Operating Partnership Agreement or any
contracts to which the Operating Partnership is a party of which we are aware.
(iv) The Securities to be purchased by the Underwriters from the Company
have been duly authorized for issuance and sale to the Underwriters pursuant to,
and in accordance with the terms of, the
Underwriting Agreement and, when issued
and delivered by the Company pursuant to the
Underwriting Agreement against
payment of the consideration set forth in the
Underwriting Agreement, will be
validly issued, fully paid and nonassessable; the issuance and sale of the
Securities by the Company is not subject to any preemptive or other similar
rights to purchase or subscribe for shares of beneficial interest of the Company
arising under Maryland REIT Law, the declaration of trust and by-laws of the
Company or any contract to which the Company is a party of which we are aware.
(v) The Operating Partnership has been duly organized and is validly
existing as a limited partnership in good standing under the laws of the State
of Delaware and has the requisite power and authority to own, lease and operate
its properties and to conduct the business in which it is engaged as described
in the Operating Partnership Agreement and the Prospectus and is duly qualified
or registered as a foreign limited partnership to transact business and is in
good standing in each jurisdiction listed in SCHEDULE 2 to our opinion.
(vi) Keystone Associates New Jersey, LLC and 4 Points Associates LLC
have been duly organized and are validly existing as limited liability companies
in good standing under the laws of the State of Delaware and the laws of the
State of Indiana, respectively, and have the requisite power and authority to
own, lease and operate their respective properties and to conduct the business
in which they are engaged as described in the Prospectus and are duly qualified
or registered as a foreign limited partnership to transact business and are in
good standing in each jurisdiction listed in SCHEDULE 2 to our opinion.
(vii) The execution and delivery of the
Underwriting Agreement have been
duly authorized by all necessary action of the Company and the Operating
Partnership, and the
Underwriting Agreement has been duly executed and delivered
by the Company and the Operating Partnership.
(viii) The Registration Statement, at the time that it became effective,
and the Prospectus, as of its date and as of the date hereof (in each case,
other than documents incorporated by reference therein and the financial
statements, supporting schedules and other financial data included or
incorporated by reference therein or omitted therefrom and for statistical
information derived from such financial statements, supporting schedules or
other financial data, as to which no opinion is rendered), complied as to form,
in all material respects, with the applicable requirements of the Securities Act
and the Regulations.
(ix) The documents incorporated by reference in the Prospectus (other
than the financial statements, supporting schedules and other financial data
included or incorporated by reference therein or omitted therefrom and for
statistical information derived from such financial statements, supporting
schedules or other financial data, as to which no opinion is rendered), when
they became effective or were filed with the Commission, as the case may be,
complied as to form, in all material respects, with the requirements of the 1933
Act, the Regulations, the
2
Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Commission thereunder, as applicable.
(x) The form of certificate used to evidence the shares of Series D
Preferred Stock of the Company complies, in all material respects, with all
applicable Maryland REIT Law requirements, with any applicable requirements of
the declaration of trust and by-laws of the Company and the requirements of the
New York Stock Exchange.
(xi) To our knowledge and except as described or incorporated by
reference in the Prospectus, there is not pending or threatened any action,
suit, proceeding, inquiry or investigation, to which the Company, the Operating
Partnership or any Subsidiary is a party, or to which the property of the
Company, the Operating Partnership or any Subsidiary is subject, before or
brought by any court or governmental agency or body, domestic or foreign, which
might reasonably be expected to result in a Material Adverse Effect or to affect
the consummation of the transactions contemplated in the
Underwriting Agreement
or the performance by the Company or the Operating Partnership of their
respective obligations thereunder.
(xii) The information in the Prospectus under "Description of Series D
Preferred Stock," "Description of Shares of Beneficial Interest --Common
Shares," "Description of Shares of Beneficial Interest --Preferred Shares," and
"Certain Federal Income Tax Considerations" to the extent that it constitutes
matters of law, summaries of legal matters, the Company's declaration of trust
and by-laws, legal proceedings or legal conclusions, has been reviewed by us and
is correct in all material respects.
(xiii) To our knowledge, there are no Maryland, New York, DRULPA or U.S.
federal securities statutes or regulations that are required to be described in
the Prospectus that are not described as required.
(xiv) Commencing with its taxable year ended December 31, 1993, the
Company was organized and has been operated in conformity with the requirements
for qualification as a real estate investment trust under the Internal Revenue
Code of 1986, as amended (the "Code") and the proposed method of operation of
the Company and the Operating Partnership, as described in the Prospectus and as
represented by the Company and the Operating Partnership, will permit the
Company to continue to so qualify.
(xv) All descriptions in the Registration Statement of contracts and
other documents which are filed as exhibits to the 10-K, to the Quarterly
Reports on Form 10-Q filed with the Commission on May 15, 2002, August 14, 2002
and November 14, 2002 (the "10-Qs") and to the Current Reports on Form 8-K of
the Company filed with the Commission on March 5, 2002 and December 27, 2002
(the "8-Ks") to which the Company, the Operating Partnership or any Subsidiary
is a party are accurate in all material respects. To our knowledge, there are no
franchises, contracts, indentures, mortgages, loan agreements, notes, leases or
other instruments required to be described or referred to therein or filed or
incorporated by reference as exhibits thereto that were not so filed,
incorporated by reference or described as required. To our knowledge, (i)
neither the Company nor the Operating Partnership is in violation of its
Governing Instruments and (ii) no default by the Company or the Operating
Partnership exists in
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the due performance or observance of any material obligation, agreement,
covenant or condition contained in any agreement filed as an exhibit to the
10-K, the 10-Qs or the 8-Ks, except for such defaults that would not result in a
Material Adverse Effect.
(xvi) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any U.S. federal, Maryland,
Delaware or New York State court or governmental authority or agency, domestic
or foreign (other than under the Securities Act and the Regulations, which have
been obtained, or as may be required under the securities or blue sky laws of
the various states or the rules and regulations of the NASD, as to which we
express no opinion) is necessary or required in connection with the due
authorization, execution and delivery of the
Underwriting Agreement or for the
offering, issuance, sale or delivery of the Securities.
(xvii) The execution, delivery and performance of the Underwriting
Agreement by the Company and the Operating Partnership and the consummation of
the transactions contemplated in the Underwriting Agreement and in the
Prospectus (including the issuance and sale of the Securities and the use of the
proceeds from the sale of the Securities as described in the Prospectus under
the caption "Use of Proceeds") and compliance by the Company and the Operating
Partnership with their respective obligations under the Underwriting Agreement
does not and will not (i) whether with or without the giving of notice or lapse
of time or both, conflict with or constitute a breach of, or default or
Repayment Event under, or result in the creation or imposition of any material
lien, charge or encumbrance upon any material property or assets of the Company
or the Operating Partnership pursuant to any contract listed as an exhibit to
the 10-K, the 10-Qs or the 8-Ks to which the Company or the Operating
Partnership is a party or by which it or any of them may be bound or to which
any of the property or assets of the Company or the Operating Partnership is
subject, (ii) result in any violation of the provisions of the Governing
Instruments of the Company or the Operating Partnership, or (iii) result in any
violation of any applicable Maryland, New York, DRULPA or U.S. federal
securities law, statute, rule, regulation, judgement, order, writ or decree,
known to us, of any Maryland, Delaware, New York or U.S. federal government,
government instrumentality or court, domestic or foreign, having jurisdiction
over the Company or the Operating Partnership or any of their respective assets
or properties, except in the case of clauses (i) and (iii) above, for such
violations, conflicts, breaches or defaults or liens, charges, encumbrances or
Repayment Events that would not result in a Material Adverse Effect.
(xviii) To our knowledge, there are no persons with registration rights (or
other similar rights) to have any securities of the Company registered pursuant
to the Registration Statement or otherwise registered by the Company under the
Securities Act in connection with the issuance and sale of the Securities.
(xix) Neither the Company nor the Operating Partnership is an "investment
company" or an entity "controlled" by an "investment company," as such terms are
defined in the 1940 Act.
(xx) The Articles Supplementary relating to the Series D Preferred Stock
have been filed for record with the SDAT pursuant to the Maryland REIT Law, and
the number, title, par value, liquidation preference, ranking, distribution
rate, distribution payment dates, redemption provisions and other terms of the
Series D Preferred Stock have been set forth therein.
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In addition, we have participated in the preparation of the Registration
Statement and the Prospectus and participated in discussions with certain
officers, trustees and employees of the Company, representatives of KPMG LLP,
the independent accountants who examined the financial statements of the Company
included or incorporated by reference in the Registration Statement and the
Prospectus, and you and your representatives and we have reviewed certain trust
and partnership records and documents. While we have not independently verified
and are not passing upon, and do not assume any responsibility for, the
accuracy, completeness or fairness of the information contained in the
Registration Statement and the Prospectus (including any of the documents
incorporated by reference therein except as set forth in opinion (xi) above), on
the basis of such participation and review, nothing has come to our attention
that would lead us to believe that the Registration Statement (except for
financial statements, supporting schedules and other financial data included or
incorporated by reference therein or omitted therefrom and for statistical
information derived from such financial statements, supporting schedules or
other financial data, as to which we do not express any belief), at the time
such Registration Statement became effective (including the filing of the
Company's Annual Report on Form 10-K for the year ended December 31, 2001 with
the Commission), contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus (except for financial
statements, supporting schedules and other financial data included or
incorporated by reference therein or omitted therefrom and for statistical
information derived from such financial statements, supporting schedules or
other financial data, as to which we do not express any belief), at the time the
Prospectus was issued, or at the Closing Time, included or includes an untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
The opinions set forth in this letter relate only to the federal securities
laws of the United States, and the laws of the State of New York, the Maryland
REIT Law and the Revised Uniform Limited Partnership Act of Delaware ("DRULPA").
With respect to matters concerning the DRULPA involved in the opinions set forth
above, we draw to your attention that the members of our firm are not admitted
to practice law in the State of Delaware. To the extent that any opinions stated
herein relate to the laws of the State of Maryland, with your permission and
without independent investigation, we have relied upon the opinion of Xxxxx
Xxxxxxx LLP, dated the date hereof, a copy of which has been delivered to you.
Our opinion, to the extent based upon such reliance, is limited by the
qualifications, assumptions and conditions set forth in such opinion in addition
to those set forth herein. We express no opinion (A) as to the enforceability of
forum selection clauses in the federal courts or (B) with respect to the
requirements of, or compliance with, any state securities or blue sky or real
estate syndication laws.
We have been informed by the Staff of the Commission that the Registration
Statement is effective under the Securities Act and, to our knowledge, no stop
order suspending the effectiveness of the Registration Statement has been issued
under the Securities Act or proceedings therefor initiated or threatened by the
Commission.
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