Exhibit 1
1,500,000 Shares
COLONIAL PROPERTIES TRUST
(an Alabama Real Estate Investment Trust)
Common Shares of Beneficial Interest
(par value $.01 per share)
UNDERWRITING AGREEMENT
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January 27, 1997
XXXXXX BROTHERS INC.
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Ladies and Gentlemen:
Colonial Properties Trust, a real estate investment trust organized under
the laws of the State of Alabama (the "Company"), proposes to sell an aggregate
of 1,500,000 shares (the "Firm Shares") of the Company's common shares of
beneficial interest, $.01 par value per share (the "Common Shares"), to you
(hereinafter the "Underwriter"). The Company also has agreed to grant to the
Underwriter an option (the "Option") to purchase up to an additional 225,000
Common Shares (the "Option Shares") on the terms and for the purposes set forth
in Section 2 hereof. The Firm Shares and the Option Shares are hereinafter
collectively referred to as the "Shares."
The public offering price per share for the Shares and the purchase price
per share for the Shares to be paid by the Underwriter shall be agreed upon by
the Company and the Underwriter, and such agreement shall be set forth in a
separate written instrument substantially in the form of Schedule I hereto (the
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"Price Determination Agreement"). The Price Determination Agreement may take
the form of an exchange of any standard form of written telecommunication among
the Company and the Underwriter and shall specify such applicable information as
is indicated in Schedule I hereto. The offering of the Shares will be governed
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by this Agreement, as supplemented by the Price Determination Agreement. From
and after the date of the execution and delivery of the Price Determination
Agreement, this Agreement shall be deemed to incorporate, and, unless the
context otherwise indicates, all references contained herein to "this Agreement"
and to the phrase "herein" shall be deemed to include, the Price Determination
Agreement.
1. Representations, Warranties and Agreements of the Company. The Company
represents, warrants and agrees as follows:
(a) The Company meets the requirements for use of Form S-3 and a shelf
registration statement on Form S-3 (File Nos. 33-89612 and 333-18259)
relating to the Shares, one or more series of the Company's unsecured debt
securities, preferred shares of beneficial interest, Common Shares and
warrants exercisable for Common Shares, including a prospectus, has (i)
been prepared by the Company in conformity with the requirements of the
Securities Act of 1933, as amended (the "Securities Act"), and the rules
and regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder, (ii) been filed with the
Commission under the Securities Act and (iii) become effective under the
Securities Act. The registration statement and prospectus may have been
amended or supplemented prior to the date of this Agreement; any such
amendment or supplement was so prepared and filed, and any such amendment
filed after the effective date of the registration statement has become
effective. No stop order suspending the effectiveness of the registration
statement has been issued, and no proceeding for that purpose has been
instituted or, to the Company's knowledge, threatened by the Commission.
Copies of the registration statement and prospectus, any amendments or
supplements and all documents incorporated by reference therein that were
filed with the Commission on or prior to the date of this Agreement have
been delivered or made available to the Underwriter. As used in this
Agreement, "Effective Time" means the date and the time as of which such
registration statement, or the most recent post-effective amendment
thereto, if any, was declared effective by the Commission; "Effective Date"
means the date of the Effective Time; "Base Prospectus" means the
prospectus included in such registration statement, and as further amended
and filed under Rule 424(b) at the time of the filing of the Prospectus
Supplement; "Prospectus Supplement" means each prospectus supplement
accompanying the Base Prospectus in connection with the offer and sale of
the Shares, or amendments or supplements thereto; the Base Prospectus and
Prospectus Supplement include any prospectus filed with the Commission by
the Company pursuant to Rule 424(b) of the Rules and Regulations with
respect to the offer and sale of the Shares; "Registration Statement" means
such registration statement, as amended at the Effective Time, including
any documents incorporated by reference therein at such time and all
information contained in the Prospectus (as defined below) filed with the
Commission pursuant to Rule 424(b) of the Rules and Regulations; and
"Prospectus" means the final Base Prospectus and Prospectus Supplement, as
first filed with the Commission pursuant to Rule 424(b) of the Rules and
Regulations. Reference made herein to the Prospectus Supplement or to the
Prospectus shall be deemed to refer to and include any documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the
Securities Act, as of the date of such Prospectus Supplement or the
Prospectus, as the case may be, and any reference to any amendment or
supplement to the Prospectus Supplement or the Prospectus shall be deemed
to refer to and include any document filed under the Securities Exchange
Act of 1934 (the "Exchange Act") after the date of the Prospectus
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Supplement or the Prospectus, as the case may be, and incorporated by
reference in such Prospectus Supplement or the Prospectus, as the case may
be; and any reference to any amendment to the Registration Statement shall
be deemed to include any report or document filed by or on behalf of the
Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act after the Effective Time that is incorporated by
reference in the Prospectus.
(b) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the
Commission, as the case may be, and at the Closing Date (as hereinafter
defined), and if later, the Option Closing Date (as hereinafter defined),
including the financial statements included or to be included or
incorporated by reference or to be incorporated by reference into the
Prospectus, conform in all respects to the requirements of the Securities
Act and the Rules and Regulations, and do not and will not, as of the
applicable Effective Date (as to the Registration Statement and any
amendment thereto) and as of the applicable filing date (as to the
Prospectus and any amendment or supplement thereto) contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; provided, however, that no representation or warranty is made
as to information contained in or omitted from the Registration Statement
or the Prospectus in reliance upon and in conformity with written
information furnished to the Company by or on behalf of the Underwriter
specifically for inclusion therein. The Company acknowledges that the
statements with respect to the public offering of the Shares set forth on
the cover page and back page of, and set forth under the caption
"Underwriting" in, the Prospectus constitute the only information relating
to the Underwriter furnished in writing to the Company by the Underwriter
specifically for inclusion in the Registration Statement or Prospectus or
any amendment or supplement thereto.
(c) The documents incorporated by reference in the Registration
Statement and the Prospectus, when they became effective or were filed with
the Commission, as the case may be, conformed in all respects to the
requirements of the Securities Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder, and none of such
documents 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, when read together with the Prospectus, not
misleading; and any further documents so filed and incorporated by
reference in the Registration Statement, or any further amendment or
supplement thereto, and the Prospectus, or any further amendment or
supplement thereto, when such documents become effective or are filed with
the Commission, as the case may be, will conform in all material respects
to the requirements of the Securities Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder and
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading.
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(d) The only subsidiaries (as defined in Rule 405 of the Rules and
Regulations) of the Company are the subsidiaries listed on Schedule II
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hereto (the "subsidiaries"). The Company and each of its subsidiaries is,
and at the Closing Date (as hereinafter defined) will be, an entity duly
organized or formed, as the case may be, and validly existing and in good
standing under the laws of the jurisdiction of its organization or
incorporation. The Company and each of its subsidiaries has, and at the
Closing Date (as hereinafter defined) will have, full power and authority
to conduct all the activities conducted by it, to own or lease all the
assets owned or leased by it and to conduct its business as described in
the Registration Statement and the Prospectus. The Company and each of its
subsidiaries is, and at the Closing Date (as hereinafter defined) will be,
duly licensed or qualified to do business and in good standing as a foreign
trust, limited partnership or corporation, as the case may be, in all
jurisdictions in which the nature of the activities conducted by it or the
character of the assets owned or leased by it makes such licensing or
qualification necessary except where the failure to be so qualified does
not have a material adverse effect on the financial condition, results of
operations, business affairs or business prospects of the Company and its
subsidiaries, taken as a whole. Except for the stock or partnership
interests of the subsidiaries and as disclosed in the Registration
Statement, the Company does not own, and at the Closing Date (as
hereinafter defined) will not own, directly or indirectly, any shares of
stock or any other equity or long-term debt securities of any corporation
or have an equity interest in any firm, partnership, joint venture,
association or other entity. Complete and correct copies of the Declaration
of Trust and Amended and Restated Bylaws of the Company and the charter or
formation documents of each of its subsidiaries and all amendments thereto
have been delivered or made available to the Underwriter, and no changes
therein will be made subsequent to the date hereof and prior to the Closing
Date (as hereinafter defined) or, if later, the Option Closing Date (as
hereinafter defined).
(e) The outstanding Common Shares have been, and the Shares to be
issued and sold by the Company upon such issuance and payment pursuant
hereto of the purchase price contemplated herein will be, duly authorized,
validly issued, fully paid and nonassessable and will not be subject to any
preemptive or similar right. The description of the Common Shares in the
Registration Statement and the Prospectus is, and at the Closing Date will
be, in all material respects, complete and accurate. Except as set forth in
the Prospectus, the Company does not have outstanding, and at the Closing
Date will not have outstanding, any options to purchase, or any rights or
warrants to subscribe for, or any securities or obligations convertible
into, or any contracts or commitments to issue or sell, any Common Shares,
any shares of capital stock of any subsidiary or any such warrants,
convertible securities or obligations other than pursuant to the Company's
employee and director option and restricted share plans and its dividend
reinvestment plan.
(f) This Agreement has been duly authorized, executed and delivered by
the Company and constitutes the valid and binding agreement of the Company,
enforceable
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against the Company in accordance with its terms, except to the extent that
enforcement thereof may be limited by (i) bankruptcy, insolvency,
fraudulent conveyance, fraudulent transfer, reorganization, moratorium or
other similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity); the
execution, delivery and performance of this Agreement by the Company and
the consummation of the transactions contemplated herein will not conflict
with or result in a breach or violation of any of the terms or provisions
of, or constitute a default under, or result in the creation or imposition
of any lien, charge or encumbrance upon any of the properties or assets of
the Company or any of its subsidiaries pursuant to any indenture, mortgage,
deed or trust, loan agreement or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company or
any of its subsidiaries is bound or to which any of the property or assets
of the Company or any of its subsidiaries is subject, except in any case
where such conflict, breach, violation or default would not result in a
material adverse effect, nor did or will such actions result in any
violation of the provisions of the charter, partnership agreement or bylaws
of the Company or any of its subsidiaries or any statute or any order, rule
or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties or assets; and except for the registration of the Shares under
the Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the Exchange Act
and applicable state securities laws in connection with the purchase and
distribution of the Shares by the Underwriter, which have already been
obtained or made or will be obtained or made prior to closing or which the
failure to obtain would not result in a material adverse effect, no
consent, approval, authorization or order of, or filing or registration
with, any such court or governmental agency or body was or is required for
the execution, delivery and performance of this Agreement by the Company,
the consummation of the transactions contemplated herein, and the issuance,
sale and delivery of the Shares.
(g) Except as disclosed in the Prospectus, and except that all holders
of units of the Company's operating partnership, Colonial Realty Limited
Partnership, have the right to compel the Company to register their Common
Shares received upon redemption of such units, there are no contracts,
agreements or understandings between the Company, on the one hand, and any
person, on the other, granting such person the right to require the Company
or any of its subsidiaries to file a registration statement under the
Securities Act with respect to any securities of the Company or any of its
subsidiaries owned or to be owned by such person or to require the Company
to include such securities in the securities registered pursuant to the
Registration Statement or in any securities being registered pursuant to
any other registration statement filed by the Company under the Securities
Act.
(h) Since the date of the latest audited financial statements included
or incorporated by reference in the Registration Statement or the
Prospectus, and except
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as set forth in the Prospectus, (i) there has been no material adverse change in
the financial condition, results of operations, business affairs or business
prospects of the Company and its subsidiaries, taken as a whole, whether or not
arising in the ordinary course of business, (ii) no material casualty, loss or
material condemnation or other material adverse event with respect to any
properties or assets of the Company or any of its subsidiaries has occurred,
(iii) there have been no transactions or acquisitions entered into by the
Company or any of its subsidiaries other than those in the ordinary course of
business that are material to the Company or any of its subsidiaries, (iv) there
has been no dividend or distribution of any kind declared, paid or made on any
class of capital stock or partnership interests of the Company or any of its
subsidiaries, and (v) there has been no change in the capital stock of the
Company, or any material increase in the indebtedness of the Company or any of
its subsidiaries.
(i) The financial statements (including the related notes and supporting
schedules) filed as part of the Registration Statement or included or
incorporated by reference in the Prospectus present fairly the financial
condition and results of operations of the entities purported to be shown
thereby, at the dates and for the periods indicated, and have been prepared in
conformity with generally accepted accounting principles applied on a consistent
basis throughout the periods involved (except as otherwise stated therein) and
comply with the applicable accounting requirements of the Securities Act
(including, without limitation, Rule 3-14 of Regulation S-X promulgated by the
Commission), and all adjustments necessary for a fair presentation of the
results for such periods have been made; the pro forma financial information
included or incorporated by reference in the Prospectus has been prepared in
accordance with the applicable requirements of the Securities Act, the Rules and
Regulations and AICPA guidelines with respect to pro forma financial information
and includes all adjustments necessary to present fairly the pro forma financial
position of the respective entity or entities presented therein at the
respective dates indicated and the results of their operations for respective
periods specified and the assumptions on which such pro forma financial
statements have been prepared are reasonable and are set forth in the notes
thereto.
(j) Coopers & Xxxxxxx L.L.P., who have certified certain financial
statements of the Company and whose reports appear in the Prospectus or are
incorporated by reference therein and who have delivered the initial letter
referred to in Section 6(f) hereof, are independent public accountants as
required by the Securities Act and the Rules and Regulations, and were
independent accountants as required by the Securities Act and the Rules and
Regulations during the periods covered by the financial statements on which they
reported; and there have been no disagreements with any accountants or
"reportable events" (as defined in Item 304 of Regulation S-K promulgated by the
Commission), in either case as required to be disclosed in the Prospectus or
elsewhere pursuant to such Item 304.
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(k) The Company and its subsidiaries each have good and marketable title in
fee simple to all real property and good and marketable title to all personal
property owned by it, in each case free and clear of all liens, encumbrances and
defects except such as are described in the Prospectus or such as do not
materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the Company or its
subsidiaries; and any real property and buildings held under lease by the
Company or any of its subsidiaries are held under valid, subsisting and
enforceable leases in each case free and clear of all liens, encumbrances and
defects except such as are described in the Prospectus or such as do not
materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the Company or its
subsidiaries.
(l) The Company and its subsidiaries carry, or are covered by, insurance in
such amounts and covering such risks as is adequate for the conduct of their
respective businesses and the value of the Company's and its subsidiaries'
assets and properties and is customary for companies engaged in similar
industries.
(m) The Company and its subsidiaries own, possess or can acquire on
reasonable terms, adequate rights to use all material patents, patent
applications, trademarks, service marks, trade names, trademark registrations,
service xxxx registrations, copyrights and licenses necessary for the conduct of
their respective businesses and do not believe that the conduct of their
respective businesses will conflict with, and have not received any notice of
any claim of conflict with, any such rights of others.
(n) The mortgages and deeds of trust encumbering the properties and assets
described in the Prospectus are not convertible to equity interests; except as
disclosed on Schedule III hereto, the mortgagees and beneficiaries thereof do
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not directly or indirectly receive any interest based on the revenues or profits
derived from the Company's or its subsidiaries' properties or hold any other
participating interest therein; and such mortgages and deeds of trust are not
cross-defaulted with the obligations of any party other than the Company or any
of its subsidiaries and do not require as collateral any property not owned or
to be owned directly or indirectly by the Company or and of its subsidiaries.
(o) The current and intended use and occupancy of each of the properties of
the Company and its subsidiaries, and all improvements constituting a part
thereof, comply with all applicable building and other codes and zoning laws and
regulations, except for such failures to comply which would not, in the
aggregate, have a material adverse effect on the financial condition, the
results of operations or the business of the Company or any of its subsidiaries.
There is no pending or threatened condemnation, zoning change, environmental or
other proceeding or action that will in any material respect affect the size of,
use of, operation of, improvements on, construction on, or
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access to the properties of the Company or its subsidiaries, except such
proceedings or actions that would not have a material adverse effect on the
financial condition, the results of operations or the business of the Company or
any of its subsidiaries. Each of the properties of the Company or any of its
subsidiaries is in compliance with all licenses, permits, certificates,
franchises and other governmental authorizations or permits necessary to the
ownership by the Company or any of its subsidiaries, of its property and the
conduct of its business except for such failures to comply which would not, in
the aggregate, have a material adverse effect on the financial condition, the
results of operations or the business of the Company or any of its subsidiaries.
To the extent that any of the properties of the Company or any of its
subsidiaries is subject to restrictive covenants of record, such property is in
compliance with such restrictive covenants in all material respects. All water
district assessments, property owner association assessments, annual maintenance
charges, and all other special assessments, charges and fees of a similar nature
due and payable prior to the date hereof have been fully paid. Except as
disclosed in the Prospectus, no tenant under any material lease has an option or
right of first refusal or similar right to purchase the premises leased
thereunder or any right to extend such lease or reduce the rent payable
thereunder. Each property of the Company or any of its subsidiaries is served by
all utilities necessary for its use and operation as currently used and fronts
on a public road or right of way.
(p) Except as set forth in the Prospectus, there are no legal or
governmental actions, suits or proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property, assets or business of
the Company or any of its subsidiaries is subject which, if determined adversely
to the Company or any of its subsidiaries, might reasonably be expected to have
a material adverse effect on the financial condition, the results of operations
or the business of the Company or any of its subsidiaries; and to the best
knowledge of the Company or any of its subsidiaries, no such proceedings are
threatened or contemplated by governmental authorities or threatened by others;
all pending legal or governmental proceedings to which the Company or any of its
subsidiaries is a party or of which any property or assets of the Company or any
of its subsidiaries is subject which are not described in the Prospectus,
including ordinary routine litigation incidental to the business, are,
considered in the aggregate, not material to the condition, financial or
otherwise, or the earnings, business affairs or business prospects of the
Company or any of its subsidiaries.
(q) There are no contracts or other documents which are required to be
described in the Prospectus or filed as exhibits to the Registration Statement
by the Securities Act or by the Rules and Regulations which have not been
described in the Prospectus or filed as exhibits to the Registration Statement
or incorporated by reference therein.
(r) No labor disturbance by the employees of the Company or any of its
subsidiaries exists or, to the knowledge of the Company, is imminent which might
be
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expected to have a material adverse effect on the financial condition, results
of operations or business of the Company or any of its subsidiaries.
(s) The Company and its subsidiaries are in compliance in all material
respects with all presently applicable provisions of the Employee Retirement
Income Security Act of 1974, as amended, including the regulations and published
interpretations thereunder ("ERISA"); no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in ERISA) for
which the Company or any of its subsidiaries would have any liability; neither
the Company nor any of its subsidiaries has incurred or expects to incur
liability under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any "pension plan" or (ii) Sections 412 or 4971 of the Internal
Revenue Code of 1986, as amended, including the regulations and published
interpretations thereunder (the "Code"); and each "pension plan" for which the
Company or any of its subsidiaries would have any liability that is intended to
be qualified under Section 401(a) of the Code is so qualified in all material
respects and nothing has occurred, whether by action or by failure to act, which
would cause the loss of such qualification.
(t) The Company and its subsidiaries have filed all federal, state and
local income and franchise tax returns required to be filed through the date
hereof and have paid all taxes due thereon, and no tax deficiency has been
determined adversely to the Company or any of its subsidiaries, which has had
(nor does the Company have any knowledge of any tax deficiency which, if
determined adversely to the Company might have) a material adverse effect on the
financial condition, results of operations or business of the Company or any of
its subsidiaries.
(u) The Company (i) makes and keeps accurate books and records and (ii)
maintains internal accounting controls which provide reasonable assurance that
(A) transactions are executed in accordance with management's authorization, (B)
transactions are recorded as necessary to permit preparation of their financial
statements and to maintain accountability for their assets, (C) access to their
assets is permitted only in accordance with management's authorization and (D)
the reported accountability for their assets is compared with existing assets at
reasonable intervals.
(v) Neither the Company nor any of its subsidiaries is (i) in violation of
its respective partnership agreement, charter, bylaws or other similar document,
(ii) in default in any material respect, and no event has or will have occurred
which, with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition contained
in any material indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it is bound or to
which any of its properties or assets is subject and where such default would
have a material adverse effect on the Company or any of its subsidiaries or
(iii) in violation in any material respect of any law, ordinance, governmental
rule, regulation or court decree to which it or its property or assets may
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be subject, or has or will have failed to obtain any material license, permit,
certificate, franchise or other governmental authorization or permit necessary
to the ownership of its property or to the conduct of its business and where
such violation or failure would have a material adverse effect on the Company or
any of its subsidiaries.
(w) Each partnership agreement to which the Company or any of its
subsidiaries is a party has been duly authorized, executed and delivered by such
applicable party and constitutes the valid agreement thereof, enforceable in
accordance with its terms except to the extent that enforcement thereof may be
limited by (i) bankruptcy, insolvency, fraudulent conveyance, fraudulent
transfer, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether enforceability is considered in a proceeding at
law or in equity). The execution, delivery and performance of any of such
agreements did not, at the time of execution and delivery, and does not
constitute a breach of, or a default under, the Declaration of Trust of the
Company or the charter or partnership agreement of any of its subsidiaries or
any material contract, lease or other instrument to which the Company is a party
or to which any of its property may be bound or any law, administrative
regulation or administrative or court decree.
(x) Except as disclosed in the Prospectus, there has been no storage,
disposal, generation, manufacture, refinement, transportation, handling or
treatment of toxic wastes, medical wastes, hazardous wastes or hazardous
substances by the Company or any of its subsidiaries or, to the Company's
knowledge, any of their respective predecessors in interests at, upon or from
any of the Company's or any of its subsidiaries' properties now or previously
owned or leased by the Company, its subsidiaries or any of their respective
predecessors in interest in violation of any applicable law, ordinance, rule,
regulation, order, judgment, decree or permit, or which would require remedial
action, damages or the modification or cessation of any activity of the Company
or any of its subsidiaries under any applicable law, ordinance, rule,
regulation, order, judgment, decree or permit, except for any violation,
remedial action, damages, modification or cessation that will not result in,
singularly or in the aggregate with all such violations, remedial actions,
damages, modifications or cessations, a material adverse effect on the financial
condition, general affairs or results of operations of the Company or any of its
subsidiaries; there has been no material spill, discharge, leak, emission,
injection, escape, dumping, migration or release of any kind onto such
properties or into the environment surrounding such properties of any toxic
wastes, medical wastes, solid wastes, hazardous wastes or hazardous substances
due to or caused by the Company or its subsidiaries with respect to which the
Company or any of its subsidiaries has knowledge, except for any such spill,
discharge, leak, emission, injection, escape, dumping, migration or release that
would not result in or would not be reasonably likely to result in, singularly
or in the aggregate with all such spills, discharges, leaks, emissions,
injections, escapes, dumpings, migrations and releases, a material adverse
effect on the financial condition or results of operations of
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the Company or any of its subsidiaries; and the terms "hazardous wastes," "toxic
wastes," "hazardous substances" and "medical wastes" shall have the meanings
specified in any applicable local, state, federal and foreign laws or
regulations with respect to environmental protection.
(y) Neither the Company nor any of its subsidiaries is, after giving effect
to the issuance of the Shares and the application of the proceeds therefrom, an
"investment company" within the meaning of such term under the Investment
Company Act of 1940 and the rules and regulations of the Commission thereunder.
(z) The Company has continuously been organized and operated in conformity
with the requirements for qualification as a real estate investment trust under
the Code for all taxable years commencing with its taxable year ended December
31, 1994. The Company has filed an election to be taxable as a real estate
investment trust for its taxable year ended December 31, 1994, and such election
has not been terminated. The Company's method of operation will permit it to
continue to meet the requirements for taxation as a real estate investment trust
under the Code. The Company intends to continue to operate in a manner which
would permit it to qualify as a real estate investment trust under the Code.
(aa) Neither the Company nor any of its subsidiaries, nor any of their
respective trustees, directors, officers or controlling persons has taken, or
will take, directly or indirectly, any action prohibited by Rule 10b-6 under the
Exchange Act.
(bb) No consent, approval, authorization or order of, or any filing or
declaration with, any court or governmental agency or body is required for the
consummation by the Company of the transactions contemplated herein, except such
as have been obtained under the Securities Act or the Rules and Regulations and
such as may be required under state securities or Blue Sky laws or the by-laws
and rules of the National Association of Securities Dealers, Inc. (the "NASD")
in connection with the purchase and distribution by the Underwriter of the
Shares to be sold by the Company.
(cc) The Shares have been approved for listing, subject to official notice
of issuance, on the New York Stock Exchange.
2. Purchase of the Shares by the Underwriter.
(a) On the basis of the representations and warranties contained in, and
subject to the terms and conditions of, this Agreement, the Company agrees to
sell to the Underwriter, and the Underwriter agrees to purchase from the Company
at the purchase price per share for the Firm Shares to be agreed upon by the
Underwriter and the Company in accordance with Section 2(c) hereof and set forth
in the Price Determination Agreement, the Firm Shares.
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(b) Subject to all the terms and conditions of this Agreement, the
Company grants the Option to the Underwriter to purchase up to 225,000
Option Shares from the Company at the same price per share as the
Underwriter shall pay for the Firm Shares. The Option may be exercised only
to cover over-allotments in the sale of the Firm Shares by the Underwriter
and may be exercised in whole or in part at any time (but not more than
once) on or before the 30th day after the date of this Agreement, upon
written or telegraphic notice (the "Option Shares Notice") by the
Underwriter to the Company. The date for the closing of the sale of the
Option Shares (the "Option Closing Date"), shall be determined by you but
shall be no later than 10 days after delivery of the Option Shares Notice.
On the Option Closing Date, the Company will issue and sell to the
Underwriter the number of Option Shares set forth in the Option Shares
Notice. The right to purchase the Option Shares or any portion thereof may
be surrendered and terminated at any time upon notice by the Underwriter to
the Company.
(c) The public offering price per share for the Firm Shares and the
purchase price per share for the Firm Shares to be paid by the Underwriter
shall be agreed upon by the Company and the Underwriter and set forth in
the Price Determination Agreement.
3. Delivery of and Payment for the Shares. Delivery of the Firm Shares
shall be made to the Underwriter against payment of the purchase price by wire
transfer of same day funds at the office of Xxxxxx Brothers Inc., 0 Xxxxx
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000. Such payments shall be made at
10:00 a.m., New York City time, on the fourth business day following the date of
this Agreement (or if the NYSE or American Stock Exchange or commercial banks in
the City of New York are not open on such day, the next day on which such
exchanges and banks are open), or at such time on such other date, not later
than eight full business days after the date of this Agreement, as may be agreed
upon by the Company and the Underwriter (such date is hereinafter referred to as
the "Closing Date").
To the extent the Option is exercised, delivery of the Option Shares
against payment by the Underwriter (in the manner specified above) will take
place at the offices specified above at the time and date (which may be the
Closing Date) specified in the Option Shares Notice.
If requested by the Underwriter, certificates evidencing the Shares shall
be in definitive form and shall be registered in such names and in such
denominations as the Underwriter shall request at least two business days prior
to the Closing Date or the Option Closing Date, as the case may be, by written
notice to the Company. For the purpose of expediting the checking and packaging
of certificates for the Shares, the Company agrees to make such certificates
available for inspection at least 24 hours prior to the Closing Date or the
Option Closing Date, as the case may be.
12
4. Further Agreements of the Company. The Company further agrees:
(a) To prepare the Prospectus in a form approved by the Underwriter and to
file such Prospectus pursuant to Rule 424(b) under the Securities Act not later
than the Commission's close of business on the second business day following the
execution and delivery of this Agreement or, if applicable, such earlier time as
may be required under the Securities Act; to make no further amendment or any
supplement to the Registration Statement or to the Prospectus prior to the
Closing Date except as permitted herein; to advise the Underwriter promptly
after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any supplement to
the Prospectus or any amended Prospectus has been filed and to furnish the
Underwriter with copies thereof; to file on a timely basis all reports and any
definitive proxy or information statements required to be filed with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act
subsequent to the date of the Prospectus and for so long as the delivery of a
prospectus is required in connection with the offering or sale of the Shares; to
advise the Underwriter, promptly after receiving notice thereof, of the issuance
by the Commission of any stop order or of any order preventing or suspending the
use of any Prospectus Supplement or the Prospectus, of the suspension of the
qualification of the Shares for offering or sale in any jurisdiction, of the
initiation or threatening of any proceeding for any such purpose, or of any
request by the Commission for the amending or supplementing of the Registration
Statement or the Prospectus or for additional information; and, in the event of
the issuance of any stop order or of any order preventing or suspending the use
of any Prospectus Supplement or the Prospectus or suspending any such
qualification, to use promptly its best efforts to obtain its withdrawal.
(b) To furnish promptly to the Underwriter, and to counsel for the
Underwriter, a signed copy of the Registration Statement as originally filed
with the Commission, and each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith.
(c) To deliver promptly to the Underwriter such number of the following
documents as the Underwriter shall request: (i) conformed copies of the
Registration Statement as originally filed with the Commission and each
amendment thereto (in each case excluding exhibits other than this Agreement),
(ii) each Prospectus Supplement, the Prospectus and any amended or supplemented
Prospectus and (iii) any document incorporated by reference in the Prospectus
(excluding exhibits thereto); and, if the delivery of a prospectus is required
at any time after the Effective Time in connection with the offering or sale of
the Shares and if at such time any event shall have occurred as a result of
which the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in light of the circumstances under which
they were made when such Prospectus is delivered, not misleading, or, if for any
other reason it
13
shall be necessary, in the reasonable opinion of counsel to the Underwriter
during such same period, to amend or supplement the Prospectus or to file under
the Exchange Act any document incorporated by reference in the Prospectus in
order to comply with the Securities Act or the Exchange Act, to notify the
Underwriter and, upon their request, to file such document and to prepare and
furnish without charge to the Underwriter and to any dealer in securities as
many copies as the Underwriter may from time to time reasonably request of an
amended or supplemented Prospectus which will correct such statement or omission
or effect such compliance, and in case the Underwriter is required to deliver a
Prospectus in connection with sales of any of the Shares at any time nine months
or more after the Effective Time, upon the request of the Underwriter and at its
own expense, to prepare and deliver to the Underwriter as many copies as the
Underwriter may reasonably request of an amended or supplemented Prospectus
complying with Section 10(a)(3) of the Securities Act.
(d) To file promptly with the Commission any amendment to the Registration
Statement or the Prospectus or any supplement to the Prospectus that may, in the
reasonable judgment of the Company or the Underwriter, be required by the
Securities Act or requested by the Commission.
(e) Prior to filing with the Commission (i) any amendment to the
Registration Statement or supplement to the Prospectus or (ii) any Prospectus
pursuant to Rule 424 of the Rules and Regulations, to furnish a copy thereof to
the Underwriter and counsel for the Underwriter and obtain the consent of the
Underwriter to the filing, which consent will not be unreasonably withheld.
(f) As soon as practicable after the Effective Date, but in any event not
later than 45 days after the end of the Company's fiscal quarter in which the
first anniversary date of the Effective Date occurs, to make generally available
to the Company's security holders and to deliver to the Underwriter an earnings
statement of the Company and its subsidiaries (which need not be audited)
complying with Section 11(a) of the Securities Act and the Rules and Regulations
(including, at the option of the Company, Rule 158).
(g) For a period of five years following the Effective Date, to furnish to
the Underwriter copies of all reports and financial statements furnished by the
Company to the Commission pursuant to the Exchange Act or any rule or regulation
of the Commission thereunder.
(h) Prior to any public offering of the Shares, the Company will cooperate
with the Underwriter and counsel to the Underwriter in connection with the
registration or qualification of the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Underwriter may request
including, without limitation, other jurisdictions outside of the United States;
provided, however, that in no event shall the Company be obligated to qualify to
do business in any jurisdiction where it is not now
14
so qualified or to take any action which would subject it to general
service of process in any jurisdiction where it is not now so subject.
(i) The Company will not, and will cause each of its executive officers
to enter into agreements with the Underwriter in the form set forth on
Schedule IV to the effect that they will not, for a period of 90 days after
-----------
the commencement of the public offering of the Shares, without the prior
written consent of the Underwriter, sell, contract to sell or otherwise
dispose of any Common Shares or rights to acquire Common Shares (other than
in the case of the Company pursuant to employee and director option and
restricted share plans, the Company's dividend reinvestment plan, the
acquisition of units of Colonial Realty Limited Partnership presented for
redemption, and in exchange for property acquired from third-parties and
pursuant to the exercise by the Underwriter of the Option, or in the case
of an individual, the pledge of Common Shares as collateral for any loan
from an institutional lender, provided the loan-to-value ratio does not
exceed 50%).
(j) To apply the net proceeds from the offering and sale of the Shares
to be sold by the Company in the manner set forth in the Prospectus under
the caption "Use of Proceeds."
(k) To take such steps as shall be necessary to ensure that, after
giving effect to the issuance of the Shares and the application of the
proceeds therefrom, neither the Company nor or any of its subsidiaries
shall become an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined under the Investment Company
Act of 1940 and the rules and regulations of the Commission thereunder.
(l) The Company will not at any time, directly or indirectly, take any
action intended, or which might reasonably be expected, to cause or result
in, or which will constitute, stabilization of the price of the Common
Shares to facilitate the sale or resale of any of the Shares.
(m) The Company will continue to elect to qualify as a "real estate
investment trust" under the Code, and will use its best efforts to continue
to meet the requirements to qualify as a "real estate investment trust."
5. Expenses. The Company agrees to pay all fees, costs and expenses
incident to the performance of the obligations of the Company under this
Agreement, including but not limited to fees, costs and expenses of or relating
to (a) the preparation, printing and filing of the Registration Statement and
exhibits to it, the Prospectus and any amendment or supplement to the
Registration Statement or the Prospectus, (b) the preparation and delivery of
certificates representing the Shares, (c) the printing of this Agreement and any
Dealer Agreements, (d) furnishing (including costs of shipping and mailing) such
copies of the Registration Statement, the Prospectus and any Preliminary
Prospectus, and all amendments and supplements thereto,
15
as may be requested for use in connection with the offering and sale of the
Shares by the Underwriter or by dealers to whom Shares may be sold, (e) the
listing of the Shares on the New York Stock Exchange, (f) filings required to be
made by or on behalf of the Company or the Underwriter, including, without
limitation, filings to be made by the Underwriter with the NASD, and the
reasonable fees, disbursements and other charges of the Underwriter's counsel in
connection therewith and filings to be made by the Company with the Commission,
and the fees, disbursements and other charges or counsel for the Company in
connection therewith, (g) the registration or qualification of the Shares for
offer and sale under the securities or Blue Sky laws of such jurisdictions
designated pursuant to Section 4(h), including the reasonable fees,
disbursements and other charges of counsel to the Underwriter in connection
therewith, and the preparation and printing of preliminary, supplemental and
final Blue Sky memoranda, (h) counsel to the Company and any surveyors,
engineers, appraisers, photographers, accountants and other professionals
engaged by or on behalf of the Company and (i) the transfer agent and registrar
for the Shares.
6. Conditions of Underwriter's Obligations. The obligations of the
Underwriter hereunder are subject to the accuracy, when made and on the Closing
Date, of the representations and warranties of the Company contained herein, to
the performance by the Company of its obligations hereunder, and to each of the
following additional terms and conditions:
(a) The Prospectus shall have been timely filed with the Commission in
accordance with Section 4(a); no stop order suspending the effectiveness of
the Registration Statement or any part thereof shall have been issued and
no proceeding for that purpose shall have been initiated or threatened by
the Commission; and any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus or
otherwise shall have been complied with.
(b) The Underwriter shall not have been advised by the Company and
shall not have discovered and disclosed to the Company that the
Registration Statement or the Prospectus or any amendment or supplement
thereto contains an untrue statement of a fact which, in the opinion of
Xxxxxxx, Procter & Xxxx LLP, counsel for the Underwriter, is material or
omits to state a fact which, in the opinion of such counsel, is material
and is required to be stated therein or is necessary to make the statements
therein not misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Shares, the
Registration Statement and the Prospectus, and all other legal matters and
agreements relating to this Agreement, the Shares, the Registration
Statement and the Prospectus and the transactions contemplated hereby and
thereby shall be satisfactory in all material respects to counsel for the
Underwriter, and the Company shall have furnished to such counsel all
documents and information that they may reasonably request to enable them
to pass upon such matters.
16
(d) Xxxxx & Xxxxxxx L.L.P. shall have furnished to the Underwriter its
written opinion, as counsel to the Company, addressed to the Underwriter and
dated the Closing Date, in form and substance satisfactory to the Underwriter,
to the effect that:
(i) The Company and its subsidiaries have been duly incorporated or
formed, as the case may be, and are validly existing and are in good
standing as partnerships or corporations, as the case may be (as indicated
on Schedule II), under the laws of their respective jurisdictions of
-----------
incorporation or organization (as indicated on Schedule II); the Company
-----------
and its subsidiaries are duly qualified to do business and are in good
standing as foreign corporations or limited partnerships, as the case may
be, in each jurisdiction indicated on Schedule II; provided, however, that
-----------
this opinion shall not apply with respect to any states in which the
Company or its subsidiaries are required to be qualified to do business
solely as a result of the sale of securities of the Company or its
subsidiaries.
(ii) The Company has an authorized capitalization as set forth under
the captions "Description of Common Shares of Beneficial Interest" in the
Base Prospectus, and all of the issued shares of capital stock of the
Company (including the Shares being delivered on the Closing Date) have
been duly authorized and, assuming receipt of consideration therefor as
provided in the resolutions authorizing issuance thereof of the board of
trustees of the Company, are validly issued and conform in all material
respects to the description thereof contained in the Prospectus under the
caption "Description of Common Shares of Beneficial Interest." All of the
issued shares of capital stock of each corporate subsidiary of the Company
have been duly authorized and, assuming receipt of consideration therefor
as provided in the applicable resolution authorizing issuance thereof of
the board of trustees of the Company or the board of directors of such
subsidiary, are validly issued and are fully paid, nonassessable and
(except as set forth in the Prospectus) are owned of record by the Company,
to the knowledge of such counsel, free and clear of all liens, charges and
encumbrances. The partnership units of each partnership subsidiary have
been authorized for issuance to the holders thereof and are validly issued.
(iii) The Registration Statement was declared effective under the
Securities Act as of the date and time specified in such opinion, the
Prospectus was filed with the Commission pursuant to Rule 424(b) of the
Rules and Regulations on the date specified in such opinion, and to such
counsel's knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that purpose
is pending or threatened by the Commission.
17
(iv) The documents incorporated by reference in the Prospectus (other
than the financial statements and supporting schedules and other financial and
statistical information and data included therein or omitted therefrom, as to
which such counsel need express no opinion), when they became effective or were
filed with the Commission, as the case may be, conformed in all material
respects to the requirements of the Securities Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder.
(v) The Registration Statement and the Prospectus excluding the
documents incorporated by reference therein, and any further amendments or
supplements thereto made by the Company prior to the Closing Date (other than
the financial statements and supporting schedules and other financial and
statistical information and data included therein or omitted therefrom, as to
which such counsel need express no opinion) comply as to form in all material
respects with the requirements of the Securities Act.
(vi) The Company was organized and has operated in conformity with the
requirements for qualification and taxation as a real estate investment trust
under the Code since the taxable year ended December 31, 1994; the Company's
current organization and method of operations will enable the Company to
continue to qualify as a real estate investment trust under the Code provided
that the Company meets the applicable asset composition, source of income,
shareholder diversification, distribution, recordkeeping and other requirements
of the Code necessary to qualify as a real estate investment trust; and the
opinion of such counsel and the opinion of Sirote & Permutt P.C. filed as
Exhibits 8.1 and 8.2, respectively to the Registration Statement is confirmed
and the Underwriter may rely upon such opinions as if they were addressed to the
Underwriter;
(vii) The statements contained in the Prospectus under the heading
"Description of Common Shares of Beneficial Interest," insofar as they describe
Alabama statutory law governing real estate investment trusts organized under
the laws of the State of Alabama constitute a fair summary thereof.
(viii) This Agreement has been duly authorized, executed and delivered by
the Company.
(ix) The issuance and sale of the Shares being delivered by the Company,
the execution and delivery of this Agreement by the Company, the consummation as
of the date hereof by the Company of the transactions contemplated by this
Agreement, the compliance as of the date hereof by the Company with the
provisions of this Agreement, have been duly authorized by all necessary trust
action and do not and will not result in any violation of the provisions of the
charter, partnership agreement or bylaws of the Company or
18
any of its subsidiaries or to such counsel's knowledge, any statute or any
order, rule or regulation of any federal, Delaware or Alabama court or any
governmental agency or body having jurisdiction over the Company or any of
its subsidiaries or any of their respective properties. Except for the
registration of the Shares under the Securities Act and such consents,
approvals, authorizations, registrations or qualifications as may be
required under the Exchange Act and applicable state or foreign securities
laws (as to which such counsel need express no opinion) in connection with
the purchase and distribution of the Shares by the Underwriter, no
consent, approval, authorization or order of, or filing or registration
with, any federal, Delaware or Alabama court or governmental agency or
body was or is required for the execution, delivery and performance of
this Agreement by the Company and the consummation of the transactions
contemplated herein or therein, and the issuance and delivery of the
Shares.
(x) Except as set forth in the Prospectus, to the knowledge of such
counsel there are no preemptive or other rights to subscribe for or to
purchase, nor any restriction upon the transfer of the Shares pursuant to
the Company's Declaration of Trust, or any agreement or other instrument
to which the Company is a party.
(xi) Except as described in the Prospectus and except that all
holders of units of the Company's operating partnership, Colonial Realty
Limited Partnership, have the right to compel the Company to register
their Common Shares received upon redemption of such units, to such
counsel's knowledge, there are no contracts, agreements or understandings
between the Company, on the one hand, and any person, on the other,
granting such person the right to require the Company or any of its
subsidiaries to file a registration statement under the Securities Act
with respect to any securities of the Company or any of its subsidiaries
owned or to be owned by such person or to require the Company to include
such securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
(xii) Neither the Company nor any of its subsidiaries is or, after
giving effect to the issuance of the Shares and the application of the
proceeds therefrom, shall be, an "investment company" within the meaning
of such term under the Investment Company Act of 1940 and the rules and
regulations of the Commission thereunder.
Counsel to the Company shall also have furnished to the Underwriter a
written statement, addressed to the Underwriter and dated the Closing Date, in
form and substance satisfactory to the Underwriter, to the effect that during
the preparation of the Registration Statement and Prospectus, such counsel has
participated in conferences
19
with officers, employees and other representatives of the Company, affiliated
entities and representatives of the independent public accountants and the
Underwriter and based on the foregoing, no facts have come to the attention of
such counsel which caused it to believe that (x) the Registration Statement, as
of the Effective Date, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading, or that the Prospectus, as
of the Closing Date, contains any untrue statement of a material fact or omits
to state a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading or (y) any
document incorporated by reference in the Prospectus or any further amendment or
supplement to any such incorporated document made by the Company prior to such
Closing Date, as of such Closing Date, contained, an untrue statement of a
material fact or omitted to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading (provided that such counsel need not comment with respect to
financial statements or other financial or statistical data or opinions of other
counsel contained in the Registration Statement or Prospectus).
(e) Xxxxxxx, Procter & Xxxx LLP shall have furnished to the Underwriter
its written opinion, as counsel to the Underwriter, addressed to the Underwriter
and dated the Closing Date, in form and substance satisfactory to the
Underwriter. Xxxxxxx, Procter & Xxxx LLP shall also have furnished to the
Underwriter a written statement, addressed to the Underwriter and dated the
Closing Date, in form and substance satisfactory to the Underwriter, to the
effect that no facts have come to the attention of such counsel which lead it to
believe that the Prospectus, as of the Closing Date and at the time such
Prospectus was issued, contains any untrue statement of a material fact or omits
to state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading (provided that such counsel need not comment with respect
to financial statements or other financial or statistical data or opinions of
other counsel contained in the Registration Statement or Prospectus).
(f) With respect to the letter of Coopers & Xxxxxxx L.L.P. delivered to the
Underwriter concurrently with the execution of this Agreement (the "initial
letter"), the Company shall have furnished to the Underwriter a letter (the
"bring-down letter") of such accountants addressed to the Underwriter and dated
such Closing Date (i) confirming that they are independent public accountants
within the meaning of the Securities Act and are in compliance with the
applicable requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission, (ii) stating, as of the date of the
bring-down letter (or, with respect to matters involving changes or developments
since the respective dates as of which specified financial information is given
or incorporated by reference in the Prospectus, as of a date not more than five
days prior to the date of the bring-down letter), the conclusions and findings
of such firm with respect to the financial information and other matters
20
covered by the initial letter and (iii) confirming in all material respects the
conclusions and findings set forth in the initial letter.
(g) The Company shall have furnished to the Underwriter a certificate,
dated the Closing Date, and with respect to the Option Shares, dated the Option
Closing Date, of the President or a Vice President and the chief financial
officer of the Company, stating that:
(i) The representations, warranties and agreements of the Company in
Section 1 are true and correct as of the Closing Date; the Company has
complied with all its agreements contained herein; and the conditions set
forth in Sections 6(a) and 6(h) have been fulfilled.
(ii) No stop order suspending the effectiveness of the Registration
Statement has been issued and, to their knowledge, no proceeding for that
purpose is pending or threatened by the Commission.
(iii) All filings required by Rule 424(b) of the Rules and Regulations
have been made and all filings required under the Exchange Act have been
made in a timely manner.
(iv) They have carefully examined the Registration Statement and the
Prospectus and, in their opinion (A) as of the Effective Date, the
Registration Statement and Prospectus did not contain any untrue statement
of a material fact and did not omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading
and (B) since the Effective Date, no event has occurred which should have
been set forth in, but was omitted from, a supplement or amendment to the
Registration Statement or the Prospectus or filing under the Exchange Act
incorporated by reference in the Prospectus.
(h) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any loss or interference with its
business from fire, explosion, flood, earthquake or other calamity, whether or
not covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in the
Prospectus, (ii) since such date there shall not have been any change in the
capital stock, partnership interests or long-term debt of the Company or any of
its subsidiaries, or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial condition,
results of operations and business of the Company or any of its subsidiaries,
otherwise than as set forth or contemplated in the Prospectus, or (iii) trading
in the Common Shares of the Company has not been suspended by the Commission or
the New York Stock Exchange, the effect of which, in any such case described in
21
clause (i), (ii) or (iii), is, in the judgment of the Underwriter, so material
and adverse as to make it impracticable or inadvisable to proceed with the
public offering and sale of the Shares being delivered on the Closing Date on
the terms and in the manner contemplated in the Prospectus.
(i) Subsequent to the execution and delivery of this Agreement there shall
not have occurred any of the following: (i) trading in securities generally on
the New York Stock Exchange, the American Stock Exchange or the over-the-counter
market shall have been suspended or minimum prices shall have been established
on either of such exchanges or such market by the Commission, by such exchange
or by any other regulatory body or governmental authority having jurisdiction,
(ii) a banking moratorium shall have been declared by Federal or state
authorities, (iii) the United States shall have become engaged in hostilities,
there shall have been an escalation in hostilities involving the United States
or there shall have been a declaration of a national emergency or war by the
United States or (iv) there shall have occurred such a material adverse change
in general economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States shall be
such) as, in the case of clauses (i) through (iv), to make it, in the judgment
the Underwriter, impractical or inadvisable to proceed with the public offering
and sale of the Shares being delivered on the Closing Date on the terms and in
the manner contemplated in the Prospectus.
(j) Leitman, Siegal, Xxxxx & Xxxxxxxx, P.C. shall have furnished to the
Underwriter their written opinion, as special real estate counsel to the
Company, addressed to the Underwriter and dated the Closing Date, in form and
substance satisfactory to the Underwriter, to the effect that:
(i) the issuance and sale of the Shares being delivered on the Closing
Date by the Company and the compliance by the Company with all the
provisions of this Agreement and the consummation of the transactions
contemplated hereby did not and will not result in a breach or violation of
any of the terms or provisions of, or constitute a default under, or result
in the creation or imposition of any lien, charge or encumbrance upon any
of the Company's or its subsidiaries' properties or assets pursuant to any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries
is bound or to which any of the properties is subject; and
(ii) such counsel has reviewed certain portions of the Registration
Statement and Prospectus at the direction of the Underwriter and such
counsel has participated in conferences with officers, employees and other
representatives of the Company and affiliated entities and has represented
the Company and affiliated entities in connection with the acquisition and
financing
22
of certain properties described in the Registration Statement and
Prospectus, and based on the foregoing, no facts have come to the
attention of such counsel which caused it to believe that the
Registration Statement, as of the Effective Date, contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the
statements therein not misleading, or that the Prospectus, as of the
Closing Date, contains any untrue statement of a material fact or
omits to state a material fact necessary in order to make the
statements therein, not misleading (provided that such counsel need
not comment with respect to financial statements or other financial or
statistical data or opinions of other counsel contained in the
Registration Statement or Prospectus).
(k) The New York Stock Exchange, Inc. shall have approved the Shares
for listing, subject only to official notice of issuance.
All opinions and certificates mentioned above or elsewhere in this
Agreement shall be deemed to be in compliance with the provisions hereof only if
they are in form and substance reasonably satisfactory to counsel for the
Underwriter. The Company shall furnish to you conformed copies of such
opinions, certificates, letters and other documents in such number as you shall
reasonably request. If any of the conditions specified in this Section 6 shall
not have been fulfilled when and as required by this Agreement, the Agreement
and all obligations of the Underwriter hereunder may be canceled at, or at any
time prior to, the Closing Date, by you. Any such cancellation shall be without
liability of the Underwriter to the Company. Notice of such cancellation shall
be given to the Company in writing, or by telephone and confirmed in writing.
7. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless the Underwriter and
each person, if any, who controls the Underwriter within the meaning of the
Securities Act, from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof (including, but not
limited to, any loss, claim, damage, liability or action relating to
purchases and sales of the Shares) to which the Underwriter or any such
controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises
out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained in any Prospectus Supplement, the
Registration Statement or the Prospectus or in any amendment or supplement
thereto or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and shall reimburse the Underwriter and
each such controlling person promptly upon demand for any legal or other
expenses reasonably incurred by the Underwriter or controlling person in
connection with investigating or defending or preparing to defend against
any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Company shall not be
23
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement or
alleged untrue statement or omission or alleged omission made in the
Registration Statement, any Prospectus Supplement or the Prospectus or in any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of the Underwriter
specifically for inclusion therein. The foregoing indemnity agreement is in
addition to any liability which the Company may otherwise have to the
Underwriter or to any controlling person of the Underwriter.
(b) The Underwriter shall indemnify and hold harmless the Company, each of
the Company's officers and trustees who signed the Registration Statement and
each person, if any, who controls the Company within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which the Company, or any such
trustee, officer or controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, any
Prospectus Supplement or the Prospectus or in any amendment or supplement
thereto or (ii) the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to the Company by or
on behalf of the Underwriter specifically for inclusion therein, and shall
reimburse the Company and any such trustee, officer or controlling person for
any legal or other expenses reasonably incurred by the Company or any such
trustee, officer or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred. The foregoing indemnity agreement is
in addition to any liability which the Underwriter may otherwise have to the
Company or any such trustee, officer or controlling person.
(c) Promptly after receipt by an indemnified party under this Section 7 of
notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 7, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 7 except to the extent it has been materially
prejudiced by such failure and, provided further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 7. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory
24
to the indemnified party. After notice from the indemnifying party to the
indemnified party of its election to assume the defense of such claim or action,
the indemnifying party shall not be liable to the indemnified party under this
Section 7 for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; provided, however, that the Underwriter shall have the
right to employ counsel to represent jointly the Underwriter and its respective
controlling persons who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the Underwriter against the Company
under this Section 7 if, in the reasonable judgment of the Underwriter, it is
advisable for the Underwriter and those controlling persons to be jointly
represented by separate counsel, and in that event the fees and expenses of such
separate counsel shall be paid by the Company.
(d) If the indemnification provided for in this Section 7 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 7(a) or 7(b) in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnifying party as a result of such loss,
claim, damage or liability, or action in respect thereof, (i) in such proportion
as shall be appropriate to reflect the relative benefits received by the Company
on the one hand and the Underwriter on the other hand from the offering of the
Shares or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law or if the indemnified party failed to give the notice required
under Section 7(c), 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 on the one hand and the Underwriter on the other with respect to the
statements or omissions which resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriter on the other with respect to such offering shall be deemed
to be in the same proportion as the total net proceeds from the offering of the
Shares purchased under this Agreement (before deducting expenses) received by
the Company bear to the total underwriting discounts and commissions received by
the Underwriter with respect to the Shares purchased under this Agreement, in
each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to whether the 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 Underwriter,
the intent of the parties and their relative knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company
and the Underwriter agree that it would not be just and equitable if
contributions pursuant to this Section 7(d) were to be determined by any method
of allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this
25
Section 7(d) shall be deemed to include, for purposes of this Section
7(d), any legal or other expenses reasonably incurred by such indemnified
party in connection with investigation or defending any such action or
claim. Notwithstanding the provisions of this Section 7(d), the
Underwriter shall not be required to contribute any amount in excess of
the amount by which the total price at which the Shares underwritten by
it and distributed to the public was offered to the public exceeds the
amount of any damages which the Underwriter has otherwise paid or become
liable to pay by reason of any 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 Securities
Act) shall be entitled to contribute from any person who was not guilty
of such fraudulent misrepresentation.
(e) The Underwriter confirms that the statements with respect to the
public offering of the Shares set forth on the cover page of, and under
the caption "Underwriting" in, the Prospectus are correct and constitute
the only information furnished in writing to the Company by or on behalf
of the Underwriter specifically for inclusion in the Registration
Statement and the Prospectus.
8. Termination. The obligations of the Underwriter hereunder may be
terminated by the Underwriter by notice given to and received by the Company
prior to delivery of and payment for the Shares if, prior to that time, any of
the events described in Sections 6(h) or 6(i) shall have occurred or if the
Underwriter shall decline to purchase the Shares for any reason permitted under
this Agreement.
9. Reimbursement of Underwriter's Expenses. If (a) the Company shall
fail to tender the Shares for delivery to the Underwriter for any reason
permitted under this Agreement or (b) the Underwriter shall decline to purchase
the Shares for any reason permitted under this Agreement (including the
termination of this Agreement pursuant to Section 8), the Company shall
reimburse the Underwriter for the fees and expenses of their counsel and for
such other out-of-pocket expenses as shall have been incurred by them in
connection with this Agreement and the proposed purchase of the Shares, and upon
demand the Company shall pay the full amount thereof to the Underwriter.
10. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriter, shall be delivered or sent by mail, telex
or facsimile transmission to Xxxxxx Brothers Inc., 0 Xxxxx Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Syndicate Registration
Department (FAX: 000-000-0000);
(b) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to the Company at Energen Plaza, 0000 0xx Xxxxxx
Xxxxx, Xxxxx 000,
00
Xxxxxxxxxx, Xxxxxxx 00000, Attention: Chief Financial Officer (FAX: 205-
000-0000).
Any such statements, requests, notices or agreements shall take effect at
the time of receipt thereof.
11. Persons Entitled to Benefit of Agreement. This Agreement shall inure
to the benefit of and be binding upon the Underwriter and the Company. This
Agreement and the terms and provisions hereof are for the sole benefit of only
those persons, except that (a) the representations, warranties, indemnities and
agreements of the Company contained in this Agreement shall also be deemed to be
for the benefit of the person or persons, if any, who control any Underwriter
within the meaning of Section 15 of the Securities Act and (b) the indemnity
agreement of the Underwriter contained in Section 7(b) of this Agreement shall
be deemed to be for the benefit of the Company, the trustees and officers of the
Company who have signed the Registration Statement and any person controlling
the Company within the meaning of Section 15 of the Securities Act. Nothing in
this Agreement is intended or shall be construed to give any person, other than
the persons referred to in this Section 13, any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision contained
herein.
12. Survival. The respective indemnities, representations, warranties
and agreements of the Company and the Underwriter contained in this Agreement or
made by either of them pursuant to this Agreement, shall survive the delivery of
and payment for the Shares and shall remain in full force and effect, regardless
of any investigation made by either of them or any person controlling either of
them.
13. Definition of the Terms "business day" and "subsidiary." For
purposes of this Agreement, (a) "business day" means any day on which the New
York Stock Exchange, Inc. is open for trading and (b) "subsidiary" has the
meaning set forth in Rule 405 of the Rules and Regulations and, when used in
reference to subsidiaries of the Company, includes the entities listed on
Schedule II.
-----------
14. Governing Law. This Agreement shall be governed and construed in
accordance with the laws of New York.
15. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
16. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
27
If the foregoing correctly sets forth the agreement among the Company and
the Underwriter, please indicate your acceptance in the space provided for that
purpose below.
Very truly yours,
COLONIAL PROPERTIES TRUST
By: /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
Accepted:
XXXXXX BROTHERS INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Managing Director
SCHEDULE I
COLONIAL PROPERTIES TRUST
----------------
January 27, 1997
Price Determination Agreement
-----------------------------
XXXXXX BROTHERS INC.
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Ladies and Gentlemen:
Reference is made to the Underwriting Agreement, dated concurrently
herewith (the "Underwriting Agreement"), between Colonial Properties Trust, an
Alabama real estate investment trust (the "Company"), and Xxxxxx Brothers Inc.
("Xxxxxx"). The Underwriting Agreement provides for the purchase by Xxxxxx
from the Company, subject to the terms and conditions set forth therein, of an
aggregate of up to 1,725,000 shares (the "Shares") of the Company's common
shares of beneficial interest, par value $.01 per share. This Agreement is the
Price Determination Agreement referred to in the Underwriting Agreement.
Pursuant to Section 2 of the Underwriting Agreement, the undersigned agree
with Xxxxxx that the purchase price per share for the Shares to be paid by the
Xxxxxx shall be $____.
The Company represents and warrants to Xxxxxx that the representations and
warranties of the Company set forth in Section 1 of the Underwriting Agreement
are accurate as though expressly made at and as of the date hereof.
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York.
I-1
If the foregoing is in accordance with your understanding of the agreement
among Lehman and the Company, please sign and return to the Company a
counterpart hereof, whereupon this instrument along with all counterparts and
together with the Underwriting Agreement shall be a binding agreement between
Xxxxxx and the Company in accordance with its terms and the terms of the
Underwriting Agreement.
Very truly yours,
COLONIAL PROPERTIES TRUST
By:
---------------------------------
Name:
Title:
Confirmed as of the date
first above mentioned:
XXXXXX BROTHERS INC.
By:
------------------------------
Name:
Title:
I-2
SCHEDULE II
THE COMPANY AND ITS SUBSIDIARIES
--------------------------------
Jurisdiction of
Jurisdiction of Foreign
Type of Entity Organization Qualification
-------------- ------------ ---------------
1. Colonial Properties Trust Real Estate Investment Alabama Georgia
(the "Company") Trust Florida
2. Colonial Realty Limited Limited Partnership Delaware Alabama
Partnership Georgia
Florida
3. Colonial Properties Corporation Alabama Georgia
Holding Company, Inc. Florida
4. Colonial Properties Limited Partnership Delaware Alabama
Services Limited Georgia
Partnership Florida
5. Colonial Properties
Services, Inc. Corporation Alabama Georgia
Florida
II-1
SCHEDULE III
PARTICIPATING MORTGAGES
-----------------------
None.
III-1
SCHEDULE IV
XXXXXX BROTHERS INC.
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Ladies and Gentlemen:
In consideration of the agreement of Xxxxxx Brothers Inc. ("Lehman") to
underwrite a proposed public offering of up to 1,725,000 common shares of
beneficial interest, par value $.01 per share (the "Shares"), of Colonial
Properties Trust, an Alabama real estate investment trust (the "Company"), as
contemplated by a registration statement with respect to such shares filed with
the Securities and Exchange Commission on Form S-3 (Registration No. 333-18259),
each of the undersigned hereby agrees that the undersigned will not, for a
period of 90 days after the commencement of the public offering of such shares,
without the prior written consent of Xxxxxx, offer to sell, sell, contract to
sell or otherwise dispose of any Common Shares or rights to acquire Common
Shares (other than in the case of the Company pursuant to employee and director
option and restricted share plans, the dividend reinvestment plan of the
Company, the acquisition of units of Colonial Realty Limited Partnership
presented for redemption, in exchange for property acquired from third parties
and upon exercise by Xxxxxx of the Option, or in the case of an individual, the
pledge of Common Shares as collateral for any loan from an institutional lender,
provided the loan-to-value ratio does not exceed 50%).
Very truly yours,
-----------------------------------------
-----------------------------------------
-----------------------------------------
-----------------------------------------
-----------------------------------------
IV-1
