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KEYSTONE PROPERTY TRUST
(a Maryland statutory real estate investment trust)
2,200,000 Shares of 7.375% Series E Cumulative Redeemable Preferred Stock
UNDERWRITING AGREEMENT
Dated: March 10, 2004
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TABLE OF CONTENTS
PAGE
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SECTION 1. Representations and Warranties................................. 2
(a) Representations and Warranties by the Company and the
Operating Partnership.......................................... 2
(i) Compliance with Registration Requirements.............. 2
(ii) Incorporated Documents................................. 3
(iii) Independent Accountants................................ 3
(iv) Financial Statements................................... 3
(v) Related-Party Transactions............................. 4
(vi) Internal Controls...................................... 4
(vii) No Material Adverse Change in Business................. 4
(viii) Good Standing of the Company........................... 5
(ix) Good Standing of the Operating Partnership............. 5
(x) Good Standing of Subsidiaries.......................... 6
(xi) Joint Ventures......................................... 6
(xii) Capitalization......................................... 6
(xiii) Authorization of Units................................. 6
(xiv) Authorization and Description of Securities............ 7
(xv) Authorization of Agreement............................. 7
(xvi) Absence of Defaults and Conflicts...................... 7
(xvii) Absence of Labor Dispute............................... 8
(xviii) Absence of Proceedings................................. 8
(xix) Accuracy of Exhibits................................... 8
(xx) REIT Qualification..................................... 8
(xxi) Investment Company Act................................. 9
(xxii) Possession of Intellectual Property.................... 9
(xxiii) Absence of Further Requirements........................ 9
(xxiv) Other Fees............................................. 9
(xxv) Possession of Licenses and Permits..................... 9
(xxvi) Title to Property...................................... 10
(xxvii) Environmental Laws..................................... 11
(xxviii)Tax Returns ........................................... 11
(xxix) Environmental Consultants.............................. 12
(xxx) Title Insurance........................................ 12
(xxxi) Absence of Regulation M Violation...................... 12
(xxxii) Registration Rights.................................... 12
(b) Officer's Certificates......................................... 12
SECTION 2. Sale and Delivery to Underwriters; Closing..................... 12
(a) Securities..................................................... 12
(b) Payment........................................................ 13
(c) Denominations; Registration.................................... 13
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SECTION 3. Covenants of the Company....................................... 13
(a) Compliance with Securities Regulations and Commission
Requests....................................................... 13
(b) Filing of Amendments........................................... 14
(c) Delivery of Registration Statements............................ 14
(d) Delivery of Prospectuses....................................... 14
(e) Continued Compliance with Securities Laws...................... 14
(f) Blue Sky Qualifications........................................ 15
(g) Rule 158....................................................... 15
(h) Reporting Requirements......................................... 15
(i) Use of Proceeds................................................ 15
(j) REIT Qualification............................................. 15
(k) Listing........................................................ 15
(l) Restriction on Sale of Securities.............................. 15
(m) No Manipulation of Market for Securities....................... 16
SECTION 4. Payment of Expenses............................................ 16
(a) Expenses....................................................... 16
(b) Termination of Agreement....................................... 16
SECTION 5. Conditions of Underwriters' Obligations........................ 16
(a) Effectiveness of Registration Statement........................ 17
(b) Opinion of Counsel for Company................................. 17
(c) Opinion of Counsel for Underwriters............................ 17
(d) Officers' Certificate.......................................... 17
(e) Accountant's Comfort Letter.................................... 18
(f) Bring-down Comfort Letter...................................... 18
(g) Approval of Listing............................................ 18
(h) Additional Documents........................................... 18
(i) Termination of Agreement....................................... 18
SECTION 6. Indemnification................................................ 18
(a) Indemnification of Underwriters................................ 18
(b) Indemnification of Company, the Operating Partnership,
Trustees and Officers.......................................... 19
(c) Actions against Parties; Notification.......................... 19
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SECTION 7. Contribution................................................... 20
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery....................................................... 21
SECTION 9. Termination of Agreement....................................... 21
(a) Termination; General........................................... 21
(b) Liabilities.................................................... 22
SECTION 10. Default by One or More of the Underwriters..................... 22
SECTION 11. Notices........................................................ 23
SECTION 12. Parties........................................................ 23
SECTION 13. GOVERNING LAW AND TIME......................................... 23
SECTION 14. Effect of Headings............................................. 23
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KEYSTONE PROPERTY TRUST
(a Maryland statutory real estate investment trust)
2,200,000 Shares of 7.375% Series E Cumulative Redeemable Preferred Stock
(Par Value $.001 Per Share)
UNDERWRITING AGREEMENT
March 10, 2004
Wachovia Capital Markets, LLC
RBC Xxxx Xxxxxxxx Inc.
c/o Wachovia Capital Markets, LLC
One Wachovia Center
000 X. Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
Keystone Property Trust, a Maryland statutory real estate investment trust
(including its predecessor the "Company"), confirms its agreement with Wachovia
Capital Markets, LLC ("Wachovia") and RBC Xxxx Xxxxxxxx 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 2,200,000 shares of the Company's 7.375% Series E cumulative
redeemable preferred stock, par value $.001 per share, liquidation preference
$25.00 per share (the "Series E Preferred Stock"). The aforesaid 2,200,000
shares of Series E Preferred Stock to be purchased by the Underwriters are
hereinafter called, 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 prospectus. Promptly after execution and
delivery of this Agreement, the Company will prepare and file a prospectus
supplement and the accompanying prospectus in accordance with the provisions of
paragraph (b) of Rule 424 (Rule 424(b)) of the rules and regulations of the
Commission under the 1933 Act (the "1933 Act Regulations"). 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 is herein called the "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." For purposes of this
Agreement, all references to the Registration Statement, the Prospectus or any
amendment or supplement to either 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 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 or the Prospectus, as the case may be; and all references in this
Agreement to amendments or supplements to the Registration Statement or the
Prospectus shall be deemed to mean and include the filing of any document under
the Securities Exchange Act of 1934, as amended (the "1934 Act"), which is
incorporated by reference in the Registration Statement or the Prospectus, as
the case may be.
The term "Subsidiary" means a corporation, a partnership or a limited
liability company, 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 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 has become effective under the 1933 Act and no stop order
suspending the effectiveness of the 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 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, the
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
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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, 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. 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 Wachovia
expressly for use in the Registration Statement or Prospectus.
Each 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 the Prospectus delivered to the
Underwriters for use in connection with this offering was identical to the
electronically transmitted copy thereof filed with the Commission pursuant
to XXXXX, except to the extent permitted by Regulation S-T.
(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 the 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, 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, shareholders' 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
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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 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, trustee, officer, shareholder,
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 trustees 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
4
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 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 Series C Convertible Preferred
Stock and the Company's Series D Cumulative Redeemable Preferred Stock
(collectively, the "Preferred Stock"), and regular quarterly distributions
on the common units and preferred units of the Operating Partnership
(collectively, 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
5
amended through December 1, 2003 (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 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 each 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 59,740,000 Common
Shares and 5,260,000 preferred shares of beneficial interest, par value
$.001 per share, of which 30,507,712 Common Shares, 500,000 shares of
Series C Convertible Preferred Stock, 2,760,000 shares of Series D
Convertible Redeemable 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, as amended as of July 3, 2003 (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
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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 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 declaration of trust 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
7
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 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
8
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").
(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 (the "NASD").
(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, trustees, 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
9
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 the
failure to possess any such Governmental Licenses would not result in a
Material Adverse Effect; 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 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
10
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 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
11
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
trustees, directors, officers or employees is connected with the Company,
the Operating 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) 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
12
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 Securities set forth in Schedule A opposite the
name of such Underwriter, plus any additional number of Securities which such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof.
(b) Payment. Payment of the purchase price for, and delivery of
certificates for, the Securities shall be made at the offices of Xxxxxxxx Chance
US LLP, 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").
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 Securities
which it has agreed to purchase. Wachovia, individually and not as
representative of the Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Securities to be purchased by any
Underwriter whose funds have not been received by the Closing Time, but such
payment shall not relieve such Underwriter from its obligations hereunder.
(c) Denominations; Registration. Certificates for the Securities 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. The
certificates for the Securities 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.
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
424(b) 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 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
13
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, 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.
(d) Delivery of Prospectuses. 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
14
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
effective date of the 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.
(g) Rule 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) 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 NYSE.
(l) Restriction on Sale of Securities. During a period beginning on the
date hereof continuing to and including 30 days from the date hereof, neither
the Company nor the Operating Partnership will, without the prior written
consent of Wachovia , (i) directly or indirectly, offer, pledge, sell, contract
to sell, sell any option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to purchase or otherwise
transfer or dispose of any Securities, any other equity securities of the
Company which are substantially similar to the Securities or any securities
convertible into or exercisable or exchangeable for Securities or any other
equity securities of the Company which are substantially similar to the
Securities or file any registration statement under the 1933 Act with respect to
any of the foregoing or (ii) enter
15
into any swap or any other agreement or any transaction that transfers, in whole
or in part, directly or indirectly, the economic consequence of ownership of any
Securities, any other equity securities of the Company which are substantially
similar to the Securities or any securities convertible into or exercisable or
exchangeable for Securities or any other equity securities of the Company which
are substantially similar to the Securities, whether any such swap or
transaction described in clause (i) or (ii) above is to be settled by delivery
of Securities or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to the Securities to be sold hereunder.
(m) 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, (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.
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 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 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 NYSE.
(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
16
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
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 relating to the Securities shall have been timely
filed with the Commission in accordance with Rule 424(b).
(b) Opinion of Counsel for Company. At Closing Time, the Underwriters
shall have received the favorable opinion, dated as of Closing Time, of Xxxxxxxx
Chance US LLP, 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 declaration of trust or by-laws
of the Company), (vii), (viii), (xii) (solely as to the information in the
Prospectus under "Description of Series E Preferred Stock"), the first paragraph
following (xx) and the last paragraph of Exhibit A hereto. 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.
17
(e) Accountant's Comfort Letter. 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.
(f) Bring-down Comfort Letter. 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 NYSE, subject only to official notice of issuance.
(h) Additional Documents. At Closing Time 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.
(i) 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, may be terminated by the Underwriters by notice to the Company at any
time at or prior to Closing Time and such termination shall be without liability
of any party to any other party except as provided in Section 4 and except that
Sections 1, 6, 7, 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) 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 the
Prospectus (or any amendment or supplement thereto), or the omission or
alleged omission therefrom of a material fact
18
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided 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 Wachovia), reasonably
incurred in investigating, preparing or defending against any litigation,
or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (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 Wachovia expressly for use in the
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto).
(b) Indemnification of Company, the Operating Partnership, Trustees and
Officers. Each Underwriter severally agrees to indemnify and hold harmless the
Company, 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, trustee, director, 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), 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 Wachovia expressly for use in the Registration Statement (or any
amendment thereto) 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 Wachovia, 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
19
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 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
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
20
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, 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 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
21
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 or
inadvisable to market the Securities or to enforce contracts for the sale of the
Securities, or (iii) if trading in any securities of the Company has been
suspended or materially limited by the Commission or the NYSE, or if trading
generally on the NYSE has been suspended or materially limited, or minimum or
maximum prices for trading have been fixed, or maximum ranges for prices have
been required, by any of said exchanges or by such system or by order of the
Commission, the NASD, or any other governmental authority, or (iv) a material
disruption has occurred in commercial banking or securities settlement or
clearance services in the United States, or (v) 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 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 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 either the (i) Underwriters or (ii) the Company shall have the
right to postpone Closing Time 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.
22
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 Wachovia Capital
Markets, LLC, One Wachovia Center, 000 X. Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxx
Xxxxxxxx 00000, attention of Debt Capital Markets; notices to the Company and
the Operating Partnership shall be directed to it at 000 Xxxx Xxxxx, 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.
23
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
-----------------
Xxxx X. Xxxxx
Senior Vice President and Secretary
KEYSTONE OPERATING PARTNERSHIP, L.P.
By: Keystone Property Trust, its
general partner
By: /s/ Xxxx X. Xxxxx
-----------------
Xxxx X. Xxxxx
Senior Vice President and Secretary
CONFIRMED AND ACCEPTED,
as of the date first above written:
WACHOVIA CAPITAL MARKETS, LLC
RBC XXXX XXXXXXXX INC.
By: Wachovia Capital Markets, LLC
By: /s/ Xxxxxx Xxx
-----------------------------
Xxxxxx Xxx
Director
On behalf of itself and the other
Underwriters named in Schedule I hereto.
24
SCHEDULE A
Number of
Name of Underwriter Securities
------------------- ----------
Wachovia Capital Markets, LLC....... 1,320,000
RBC Xxxx Xxxxxxxx Inc. ............. 880,000
Total......................... 2,200,000
=========
Sch A - 1
SCHEDULE B
KEYSTONE PROPERTY TRUST
2,200,000 Shares of 7.375% Series E 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.
Sch B - 1
SCHEDULE C
Joint Venture Ownership Limit
------------- ---------------
KPJV LLP 20%
Keystone New Jersey Associates, LLC 20%
5 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 30,507,712 common shares of beneficial
interest of the Company, 500,000 shares of Series C convertible preferred stock
and 2,760,000 shares of Series D cumulative redeemable 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 (i) the conversion
of the Series C convertible 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 C convertible 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 34,431,153 common units and 211,145 Series D
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 to 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 or 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) KPJV LLP and Keystone New Jersey Associates, LLC have been duly
organized and are validly existing as a limited liability partnership and a
limited liability company, respectively, in good standing under the laws of the
State of Delaware and 5 Points Associates, LLC has been duly organized and is
validly existing as a limited liability company in good standing under the laws
of the State of Indiana and each of the foregoing entities has 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 or incorporated by
reference in the Prospectus and are duly qualified or registered as foreign
limited partnerships 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),
2
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 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 E
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 E
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 Annual Report on Form 10-K filed
with the Commission on March 10, 2004 and the Current Report on Form 8-K of the
Company filed with the Commission on February 23, 2004 (the "8-K") 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
3
Governing Instruments and (ii) no default by the Company or the Operating
Partnership exists in 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 or the 8-K, 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 or the 8-K 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 E Preferred Stock
have been filed for record with the SDAT pursuant to the Maryland REIT Law, and
the number, title, par
4
value, liquidation preference, ranking, distribution rate, distribution payment
dates, redemption provisions and other terms of the Series E Preferred Stock
have been set forth therein.
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 (xii) 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, 2003 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. 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.
5
