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Exhibit 1(b)
DEVELOPERS DIVERSIFIED REALTY CORPORATION
(an Ohio corporation)
PREFERRED SHARES, DEPOSITARY SHARES,
COMMON SHARES AND WARRANTS TO PURCHASE COMMON SHARES
UNDERWRITING AGREEMENT BASIC PROVISIONS
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_____________ __, 1997
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
1. INTRODUCTORY. Developers Diversified Realty Corporation, an Ohio
corporation (the "Company"), proposes to issue and sell, common shares, without
par value (the "Common Shares") or warrants to purchase a number of Common
Shares (the "Warrants"), or both, or preferred shares, without par value (the
"Preferred Shares") from time to time, in one or more offerings on terms to be
determined at the time of sale. The Preferred Shares may be offered in the form
of depositary shares (the "Depositary Shares") represented by depositary
receipts (the "Depositary Receipts"). The Warrants will be issued pursuant to a
Warrant Agreement (the "Warrant Agreement") between the Company and a warrant
agent (the "Warrant Agent"). Except as provided under Ohio law and in the
Company's Articles of Incorporation, as amended (the "Articles of
Incorporation") each series of Preferred Shares may vary as to the specific
number of shares, title, stated value, liquidation preference, issuance price,
ranking, dividend rate or rates (or method of calculation), dividend payment
dates, any redemption or sinking fund requirements, any conversion provisions
and any other variable terms as set forth in the Articles of Incorporation
relating to such Preferred Shares. As used herein, "Securities" shall mean the
Common Shares and the Warrants, the Preferred Shares, the Depositary Shares and
the Depositary Receipts; and "Warrant Securities" shall mean the Common Shares
issuable upon exercise of Warrants. As used herein, "you" and "your," unless the
context otherwise requires, shall mean the parties to whom this Agreement is
addressed together with the other parties, if any, identified in
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the applicable Terms Agreement (as hereinafter defined) as additional
co-managers with respect to Underwritten Securities (as hereinafter defined)
purchased pursuant thereto.
Whenever the Company determines to make an offering of Securities
through you or through an underwriting syndicate managed by you, the Company
will enter into an agreement (the "Terms Agreement") providing for the sale of
such Securities (the "Underwritten Securities") to, and the purchase and
offering thereof by, you and such other underwriters, if any, selected by you as
have authorized you to enter into such Terms Agreement on their behalf (the
"Underwriters," which term shall include you whether acting alone in the sale of
the Underwritten Securities or as a member of an underwriting syndicate and any
Underwriter substituted pursuant to Section 11 hereof). The Terms Agreement
relating to the offering of Underwritten Securities shall specify the number of
Underwritten Securities of each class or series to be initially issued,
including the number of Warrants, if any (the "Initial Underwritten
Securities"), whether the Initial Underwritten Securities shall be in the form
of Depositary Shares and the fractional amount of Preferred Shares represented
by each Depositary Share, the names of the Underwriters participating in such
offering (subject to substitution as provided in Section 11 hereof), the number
of Initial Underwritten Securities which each such Underwriter severally agrees
to purchase, the names of such of you or such other Underwriters acting as
co-managers, if any, in connection with such offering, the price at which the
Initial Underwritten Securities are to be purchased by the Underwriters from the
Company, the initial public offering price, the time, date and place of delivery
and payment, any delayed delivery arrangements and any other variable terms of
the Initial Underwritten Securities (including, but not limited to, current
ratings, designations, liquidation preferences, conversion or exchange
provisions and the terms of the Warrant Securities and the terms, prices and
dates upon which such Warrant Securities may be purchased). In addition, each
Terms Agreement shall specify whether the Company has agreed to grant to the
Underwriters an option to purchase additional Underwritten Securities to cover
over-allotments, if any, and the number of Underwritten Securities subject to
such option (the "Option Securities"). As used herein, the term "Underwritten
Securities" shall include the Initial Underwritten Securities and all or any
portion of the Option Securities agreed to be purchased by the Underwriters as
provided herein, if any. The Terms Agreement, which shall be substantially in
the form of Exhibit A hereto, may take the form of an exchange of any standard
form of written telecommunication between you and the Company. Each offering of
Underwritten Securities through you or through an underwriting syndicate managed
by you will be governed by this Agreement, as supplemented by the applicable
Terms Agreement.
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2. REPRESENTATIONS AND WARRANTIES. (a) The Company represents and
warrants to you, as of the date hereof, and to you and each other Underwriter
named in the applicable Terms Agreement, as of the date thereof (such latter
date being referred to herein as a "Representation Date"), that:
(i) A registration statement on Form S-3 (No. 333- )
for the registration of the Securities (including the Underwritten
Securities) and Warrant Securities and certain of the Company's debt
securities, under the Securities Act of 1933, as amended (the "1933
Act"), and the offering thereof from time to time in accordance with
Rule 415 of the rules and regulations of the Securities and Exchange
Commission (the "Commission") under the 1933 Act (the "1933 Act
Regulations"), has heretofore been delivered to you, has been prepared
by the Company in conformity with the requirements of the 1933 Act and
the 1933 Act Regulations and has been filed with the Commission under
the 1933 Act. One or more amendments to such registration, as may have
been required and copies of which have heretofore been delivered to
you, have been so prepared and filed prior to the execution of the
applicable Terms Agreement. Such registration statement (as amended, if
applicable) has been declared effective by the Commission. Such
registration statement (as amended, if applicable) [and the
registration statements of the Company on Form S-3 (No. 33- ), to
the extent the applicable Terms Agreement relates to Underwritten
Securities registered thereunder in accordance with Rule 429 of the
1933 Act,] on the one hand, and the prospectus constituting a part
thereof in each case as supplemented by a prospectus supplement
relating to the offering of Underwritten Securities provided to the
Underwriters for use (whether or not such prospectus supplement is
required to be filed by the Company pursuant to Rule 424(b) of the 1933
Act Regulations) (the "Prospectus Supplement"), on the other hand,
including in each case all documents incorporated therein by reference,
and the information, if any, deemed to be a part thereof pursuant to
Rule 430A(b) or Rule 434 of the 1933 Act Regulations as from time to
time amended or supplemented pursuant to the 1933 Act, the Securities
Exchange Act of 1934, as amended (the "1934 Act") or otherwise, are
referred to herein as the "Registration Statement" and the
"Prospectus," respectively; provided, however, that a Prospectus
Supplement shall be deemed to have supplemented the Prospectus only
with respect to the offering of Underwritten Securities to which it
relates. If the Company elects to rely on Rule 434 under the 1933 Act
Regulations, all references to the Prospectus shall be deemed to
include, without limitation, the form of prospectus and the abbreviated
term sheet, taken together, provided to the Underwriters by the Company
in reliance on Rule 434 under the 1933 Act (the "Rule 434 Prospectus").
If the Company files a registration statement to register a
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portion of the Securities and the Warrant Securities relies on Rule
462(b) for such registration statement to become effective upon filing
with the Commission (the "Rule 462 Registration Statement") then any
reference to "Registration Statement" herein shall be deemed to be to
both the registration statement referred to above (No. _________) and
the Rule 462 Registration Statement, as each such registration
statement may be amended pursuant to the 1933 Act. 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 (and all other references of
like import) shall be deemed to mean and include all such financial
statements and schedules and other information which is or is deemed to
be 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, without limitation, the
filing of any document under the 1934 Act which is or is deemed to be
incorporated by reference in the Registration Statement or the
Prospectus, as the case may be.
(ii) At the time the Registration Statement became
effective, the Registration Statement and the Prospectus conformed, and
as of the applicable Representation Date will conform, in all material
respects to the requirements of the 1933 Act and the 1933 Act
Regulations. At the time the Registration Statement became effective,
the Registration Statement did not, and as of the applicable
Representation Date, 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. The
Prospectus, as of the date hereof does not, and as of the applicable
Representation Date and at Closing Time (as hereinafter defined) will
not, include an untrue statement of a material fact or 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;
provided, however, that the foregoing representations and warranties
shall not apply 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 any Underwriter, directly or through you, specifically for
use in preparation thereof.
(iii) The documents incorporated or deemed to be
incorporated by reference in the Prospectus pursuant to Item 12 of Form
S-3 under the 1933 Act, 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
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1934 Act and the rules and regulations of the Commission under the 1934
Act (the "1934 Act Regulations"), and, when read together with the
other information in the Prospectus, at the time the Registration
Statement became effective and as of the applicable Representation Date
or Closing Time or during the period specified in Section 4(f), did not
and will not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(iv) 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 not occurred any material
adverse change or any development involving a prospective material
adverse change in the condition, financial or otherwise, or in the
earnings, business or operation of the Company and its subsidiaries
considered as one enterprise from that set forth in the Prospectus
(exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement), (B) there have been no transactions entered
into by the Company or its subsidiaries which are material with respect
to the Company and its subsidiaries considered as one enterprise other
than those in the ordinary course of business, and (C) except for
regular quarterly dividends on the Company's common shares, and regular
dividends declared, paid or made in accordance with the terms of any
class or series of the Company's preferred shares, there has been no
dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(v) The consolidated financial statements and supporting
schedules of the Company included in, or incorporated by reference
into, the Registration Statement and the Prospectus present fairly the
financial position of the Company and its consolidated subsidiaries as
of the dates indicated and the results of their operations for the
periods specified and the consolidated financial statements of
Developers Diversified Group ("DDG") included in, or incorporated by
reference into, the Registration Statement and the Prospectus present
fairly the financial position of DDG as of the dates indicated and the
results of its operations for the periods specified; except as
otherwise stated in the Registration Statement and the Prospectus, said
financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis; and the
supporting schedules included or incorporated by reference in the
Registration Statement and the Prospectus present fairly in all
material respects the information required to be stated therein.
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(vi) Price Waterhouse LLP, who have expressed their opinion on
the audited financial statements and related schedules included in, or
incorporated by reference into, the Registration Statement, are
independent public accountants within the meaning of the 1933 Act and
the applicable 1933 Act Regulations.
(vii) The Company has been duly organized and is validly
existing and in good standing as a corporation under the laws of the
State of Ohio, with power and authority (corporate and other) to own,
lease and operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus; the Company
is in possession of and operating in compliance with all material
franchises, grants, authorizations, licenses, permits, easements,
consents, certificates and orders required for the conduct of its
business, all of which are valid and in full force and effect; and the
Company is duly qualified to do business and in good standing as a
foreign corporation in all other jurisdictions where its ownership or
leasing of properties or the conduct of its business requires such
qualification, except where failure to qualify and be in good standing
would not have a material adverse effect on the condition, financial or
otherwise, or on the earnings, business affairs or business prospects
of the Company and its subsidiaries considered as one enterprise.
(viii) Each subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has corporate
power and authority to own, lease and operate its properties and to
conduct its business and is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure to so qualify and be in good standing would not have a material
adverse effect on the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise.
(ix) If applicable, the capitalization of the Company is as
set forth in the Prospectus under "Capitalization;" the issued and
outstanding capital stock of the Company has been duly authorized and
validly issued and is fully paid and non-assessable and is not subject
to preemptive or other similar rights; and all of the issued and
outstanding capital stock of the Company's subsidiaries has been duly
authorized and validly issued, is fully paid and non-assessable and is
owned directly by the Company, free and
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clear of any security interest, mortgage, pledge, lien, encumbrance,
claim or equity.
(x) The Underwritten Securities being sold pursuant to the
applicable Terms Agreement and, if applicable, the deposit of the
Preferred Shares in accordance with the provisions of a Deposit
Agreement (each, a "Deposit Agreement"), among the Company, the
financial institution named in the Deposit Agreement (the "Preferred
Shares Depositary") and the holders of the Depositary Receipts issued
thereunder, have, as of each Representation Date, been duly authorized
by the Company and such Underwritten Securities have been duly
authorized by the Company for issuance and sale pursuant to this
Agreement and, when issued and delivered pursuant to this Agreement
against payment of the consideration therefor specified in the
applicable Terms Agreement or any Delayed Delivery Contract (as
hereinafter defined), will be validly issued, fully paid and
non-assessable; the Preferred Shares, if applicable, conform to the
provisions of the Articles of Incorporation; and the Underwritten
Securities being sold pursuant to the applicable Terms Agreement
conform in all material respects to all statements relating thereto
contained in the Prospectus; and the issuance of the Underwritten
Securities is not subject to preemptive or other similar rights.
(xi) If applicable, the Warrants have been duly authorized
and, when issued and delivered pursuant to this Agreement and
countersigned by the Warrant Agent as provided in the Warrant
Agreement, will have been duly executed, countersigned, issued and
delivered and will constitute valid and legally binding obligations of
the Company entitled to the benefits provided by the Warrant Agreement
under which they are to be issued; the issuance of the Warrant
Securities upon exercise of the Warrants will not be subject to
preemptive or other similar rights; and the Warrants conform in all
material respects to all statements relating thereto contained in the
Prospectus.
(xii) If applicable, the Common Shares issuable upon
conversion of any of the Preferred Shares or the Depositary Shares or
the Warrant Securities, will have been duly and validly authorized and
reserved for issuance upon such conversion or exercise by all necessary
corporate action and such shares, when issued upon such conversion or
exercise will be duly and validly issued and will be fully paid and
non-assessable, and the issuance of such shares upon such conversion or
exercise will not be subject to preemptive or other similar rights; the
Common Shares so issuable upon conversion of any of the Preferred
Shares or the Depositary Shares or the Warrant Securities will conform
in all material
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respects, as of the applicable Representation Date, to all statements
relating thereto contained in the Prospectus.
(xiii) The applicable Warrant Agreement, if any, and the
applicable Deposit Agreement, if any, will have been duly authorized,
executed and delivered by the Company prior to the issuance of any
applicable Underwritten Securities, and constitutes a valid and legally
binding agreement of the Company enforceable in accordance with its
terms, except as enforcement thereof may be limited by bankruptcy,
insolvency or other similar laws relating to or affecting creditors'
rights generally and by general equity principles (regardless of
whether enforcement is considered in a proceeding in equity or at law);
and the Warrant Agreement, if any, conforms in all material respects to
all statements relating thereto contained in the Prospectus.
(xiv) If applicable, upon execution and delivery thereof
pursuant to the terms of the Deposit Agreement, the persons in whose
names the Depositary Receipts are registered will be entitled to the
rights specified therein and in the Deposit Agreement, except as
enforcement of such rights may be limited by bankruptcy, insolvency or
other similar laws relating to or affecting creditors' rights generally
and by general equity principles (regardless of whether enforcement is
considered in a proceeding in equity or at law).
(xv) There is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, threatened against or affecting
the Company or its subsidiaries, which is required to be disclosed in
the Prospectus (other than as disclosed therein), or which might result
in any material adverse change in the condition, financial or
otherwise, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise, or might materially and
adversely affect the properties or assets thereof or which might
materially and adversely affect the consummation of this Agreement, the
applicable Terms Agreement, the applicable Warrant Agreement, if any,
or the transactions contemplated herein and therein; all pending legal
or governmental proceedings to which the Company or any of its
subsidiaries is a party or of which any of their respective property is
the subject which are not described in the Prospectus, including
routine litigation incidental to the business, are, considered in the
aggregate, not material; and there are no material contracts or
documents of the Company or its subsidiaries which are required to be
filed as exhibits to the Registration Statement by the 1933 Act or by
the 1933 Act Regulations which have not been so filed.
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(xvi) Neither the Company nor any of its subsidiaries is in
violation of its respective articles of incorporation or other
organizational document, or its Code of Regulations or bylaws, as the
case may be (the "Code of Regulations"), or in default in the
performance or observance of any material obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
loan agreement, note, lease or other instrument to which it is a party
or by which it or its properties may be bound, where such defaults in
the aggregate would have a material adverse effect on the condition,
financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as
one enterprise; and the execution and delivery of this Agreement, the
applicable Terms Agreement, and the applicable Warrant Agreement, if
any, or the applicable Deposit Agreement, if any, and the consummation
of the transactions contemplated herein and therein have been duly
authorized by all necessary corporate action and compliance by the
Company with its obligations hereunder and thereunder will not conflict
with or constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or its subsidiaries pursuant to, any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Company or any of its subsidiaries is a party
or by which it may be bound or to which any of the property or assets
of the Company or any of its subsidiaries is subject, nor will such
action result in any violation of the provisions of the Articles of
Incorporation or Code of Regulations or, to the best of its knowledge,
any law, administrative regulation or administrative or court order or
decree; and no consent, approval, authorization or order of any court
or governmental authority or agency is required for the consummation by
the Company of the transactions contemplated by this Agreement, the
applicable Terms Agreement or the applicable Warrant Agreement, if any,
or the applicable Deposit Agreement, if any, except such as has been
obtained or as may be required under the 1933 Act, the 1934 Act, state
securities or Blue Sky laws or real estate syndication laws in
connection with the purchase and distribution of the Underwritten
Securities by the Underwriters.
(xvii) The Company has full right, power and authority to
enter into this Agreement, the applicable Terms Agreement and the
Delayed Delivery Contracts, if any, and this Agreement has been, and as
of the applicable Representation Date, the applicable Terms Agreement
and the Delayed Delivery Contracts, if any, will have been duly
authorized, executed and delivered by the Company.
(xviii) With respect to its taxable years ended December 31,
1996, and its taxable years ending thereafter,
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the Company has operated and will continue to operate so as to qualify
as a Real Estate Investment Trust ("REIT"), the Company qualified as a
REIT for its taxable years ended December 31, 1993, December 31, 1994
and December 31, 1995 and the Company intends to be taxed as a REIT
with respect to its taxable year ended December 31, 1996.
(xix) Neither the Company nor any of its subsidiaries is
required to be registered under the Investment Company Act of 1940, as
amended (the "1940 Act").
(xx) Neither the Company nor any of its subsidiaries is
required to own or possess any trademarks, service marks, trade names
or copyrights in order to conduct the business now operated by them.
(xxi) There are no persons with registration or other similar
rights to have any securities registered pursuant to the Registration
Statement.
(xxii) None of the Company or any of its subsidiaries or any
of the officers, directors, trustees or partners thereof has taken nor
will any of them 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 which has constituted or which reasonably might be
expected to constitute, the stabilization or manipulation of the price
of the Underwritten Securities, Common Shares issuable upon conversion
of any of the Preferred Shares or facilitation of the sale or resale of
the Underwritten Securities.
(xxiii) If applicable, the Underwritten Securities will be
approved for listing on the New York Stock Exchange as of the closing.
(xxiv) (A) The Company or its subsidiaries have good and
marketable title or leasehold interest, as the case may be, to the
portfolio properties (the "Portfolio Properties") described in the
Prospectus (or documents incorporated by reference therein) as being
owned by the Company or its subsidiaries (except with respect to
properties described in the Prospectus or documents incorporated by
reference therein) as being held by the Company through joint ventures,
in each case free and clear of all liens, encumbrances, claims,
security interests and defects (collectively, the "Defects"), except
such as do not materially adversely affect the value of such property
or interests and do not materially interfere with the use made and
proposed to be made of such property or interests by the Company or
such subsidiaries, as the case may be; (B) the joint venture interest
in each property described in the Prospectus (or documents incorporated
by reference therein), as being held by the Company through a joint
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venture, is owned free and clear of all Defects except for such Defects
that will not have a material adverse effect on the business, earnings
or business prospects of the Company and its subsidiaries considered as
one enterprise; (C) all liens, charges, encumbrances, claims, or
restrictions on or affecting the properties and assets of the Company
or its subsidiaries which are required to be disclosed in the
Prospectus are disclosed therein; (D) none of the Company, its
subsidiaries or, to the best of the Company's knowledge, any lessee of
any of the Portfolio Properties is in default under any of the leases
governing the Portfolio Properties and the Company does not know of any
event which, but for the passage of time or the giving of notice, or
both, would constitute a default under any of such leases, except such
defaults that would not have a material adverse effect on the
condition, financial or otherwise, or on the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as
one enterprise; (E) no tenant under any of the leases pursuant to which
the Company or its subsidiaries leases any of the Portfolio Properties
has an option or right of first refusal to purchase the premises
demised under such lease except for (i) Kmart Corporation, (ii) the
tenants at the Portfolio Property located in Solon, Ohio, (iii) as
otherwise described in the Prospectus (or documents incorporated by
reference therein), and (iv) such other options or rights of first
refusal that, if exercised, would not have a material adverse effect on
the condition, financial or otherwise, or on the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise; (F) each of the Portfolio Properties
complies with all applicable codes and zoning laws and regulations,
except for such failures to comply which would not individually or in
the aggregate have a material adverse effect on the condition,
financial or otherwise, or on the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as
one enterprise; and (G) the Company does not have knowledge of any
pending or threatened condemnation, zoning change, or other proceeding
or action that will in any manner affect the size of, use of,
improvements on, construction on, or access to the Portfolio
Properties, except such proceedings or actions that would not have a
material adverse effect on the condition, financial or otherwise, or on
the earnings, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise.
(xxv) The Company or its subsidiaries have title insurance on
each of the Portfolio Properties (except with respect to each property
described in the Prospectus (or documents incorporated by reference
therein) as held by the Company through a joint venture) in an amount
at least equal to the greater of (A) the cost of acquisition of such
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Portfolio Property and (B) the cost of construction of the improvements
located on such Portfolio Property, except in each case, where the
failure to maintain such title insurance would not have a material
adverse effect on the condition, financial or otherwise, or on the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; the joint venture owning
each property described in the Prospectus (or documents incorporated by
reference therein) as held by the Company through a joint venture) has
title insurance on such property in an amount at least equal to the
greater of (A) the cost of acquisition of such Portfolio Property by
such joint venture and (B) the cost of construction of the improvements
located on such Portfolio Property, except in each case, where the
failure to maintain such title insurance would not have a material
adverse effect on the condition, financial or otherwise, or on the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise.
(xxvi) The mortgages and deeds of trust encumbering the
Portfolio Properties are not convertible and neither the Company nor
any of its subsidiaries hold a participating interest therein and said
mortgages and deeds of trust are not cross-defaulted or
cross-collateralized in respect of any property not owned by the
Company or its subsidiaries or in which the Company owns a joint
venture interest.
(xxvii) The Company has no knowledge of (a) the unlawful
presence of any hazardous substances, hazardous materials, toxic
substances or waste materials (collectively, "Hazardous Materials") on
any of the Portfolio Properties or of (b) any unlawful spills,
releases, discharges or disposals of Hazardous Materials that have
occurred or are presently occurring from the Portfolio Properties as a
result of any construction on or operation and use of the Portfolio
Properties, which presence or occurrence would materially adversely
affect the condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise. In connection with the construction on or
operation and use of the Portfolio Properties, the Company represents
that, as of the date of this Agreement, the Company has no knowledge of
any material failure to comply with all applicable local, state and
federal environmental laws, regulations, ordinances and administrative
and judicial orders relating to the generation, recycling, reuse, sale,
storage, handling, transport and disposal of any Hazardous Materials
that would have a material adverse effect on the condition, financial
or otherwise, or on the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise.
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(b) Any certificate signed by any officer of the Company and delivered
to you or to counsel for the Underwriters shall be deemed a representation and
warranty by the Company, as the case may be, to each Underwriter participating
in such offering as to the matters covered thereby on the date of such
certificate and, unless subsequently amended or supplemented, at the applicable
Representation Date subsequent thereto.
3. PURCHASE BY, AND SALE AND DELIVERY TO, UNDERWRITERS. (a) The several
commitments of the Underwriters to purchase the Underwritten Securities pursuant
to the applicable Terms Agreement shall be deemed to have been made on the basis
of the representations and warranties herein contained and shall be subject to
the terms and conditions herein set forth.
(b) In addition, on the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company may grant, if so provided in the applicable Terms Agreement relating to
the Initial Underwritten Securities, an option to the Underwriters named in such
Terms Agreement, severally and not jointly, to purchase up to the number of
Option Securities set forth therein at the same price per Option Security as is
applicable to the Initial Underwritten Securities less an amount equal to any
dividend paid or payable on the Initial Underwritten Securities and not payable
on the Option Securities. Such option, if granted, will expire 30 days (or such
lesser number of days as may be specified in the applicable Terms Agreement)
after the Representation Date relating to the Initial Underwritten Securities,
and may be exercised in whole or in part from time to time only for the purpose
of covering over-allotments which may be made in connection with the offering
and distribution of the Initial Underwritten Securities upon notice by you to
the Company setting forth the number of Option Securities as to which the
several Underwriters are then exercising the option and the time and date of
payment and delivery for such Option Securities. Any such time, date and place
of delivery (a "Date of Delivery") shall be determined by you, but shall not be
later than ten full business days after the Closing Time and not be earlier than
two full business days after the exercise of said option, nor in any event prior
to Closing Time, unless otherwise agreed upon by you and the Company. If the
option is exercised as to all or any portion of the Option Securities, each of
the Underwriters, acting severally and not jointly, will purchase that
proportion of the total number of Option Securities then being purchased which
the number of Initial Underwritten Securities each such Underwriter has
severally agreed to purchase as set forth in the applicable Terms Agreement
bears to the total number of Initial Underwritten Securities (except as
otherwise provided in the applicable Terms Agreement).
(c) Payment of the purchase price for, and delivery of, the Underwritten
Securities to be purchased by the Underwriters shall be made at the office of
Xxxxx & Xxxx LLP, 56th Floor, One World
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Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, or at such other place as shall be
agreed upon by you and the Company, at 10:00 A.M., New York City time, on the
third business day (unless postponed in accordance with the provisions of
Section 11 hereof) following the date of the applicable Terms Agreement, or if
such Terms Agreement is executed subsequent to 4:30 P.M. on the date of its
execution, on the fourth business day, or at such other time as shall be agreed
upon by you and the Company (each such time and date of payment and delivery
being referred to herein as the "Closing Time"). In addition, in the event that
any or all of the Option Securities are purchased by the Underwriters, payment
of the purchase price for, and delivery of certificates representing, such
Option Securities, shall be made at the above-mentioned offices of Xxxxx & Wood
LLP, or at such other place as shall be agreed upon by you and the Company on
each Date of Delivery as specified in the notice from you to the Company. Unless
otherwise specified in the applicable Terms Agreement, payment shall be made to
the Company by wire transfer in same-day funds payable against delivery to you
for the respective accounts of the Underwriters for the Underwritten Securities
to be purchased by them. The Underwritten Securities or, if applicable, the
Depositary Receipts evidencing the Depositary Shares, shall be in such
authorized denominations and registered in such names as you may request in
writing at least one business day prior to the Closing Time or Date of Delivery,
as the case may be. The Underwritten Securities, which may be in temporary form,
will be made available for examination and packaging by you on or before the
first business day prior to the Closing Time or the Date of Delivery, as the
case may be.
If authorized by the applicable Terms Agreement, the Underwriters named
therein may solicit offers to purchase Underwritten Securities from the Company
pursuant to delayed delivery contracts ("Delayed Delivery Contracts")
substantially in the form of Exhibit B hereto with such changes therein as the
Company may approve. As compensation for arranging Delayed Delivery Contracts,
the Company will pay to you at Closing Time, for the respective accounts of the
Underwriters, a fee specified in the applicable Terms Agreement for each of the
Underwritten Securities for which Delayed Delivery Contracts are made at the
Closing Time as is specified in the applicable Terms Agreement. Any Delayed
Delivery Contracts are to be with institutional investors of the types described
in the Prospectus. At the Closing Time, the Company will enter into Delayed
Delivery Contracts (for not less than the minimum number of Underwritten
Securities per Delayed Delivery Contract specified in the applicable Terms
Agreement) with all purchasers proposed by the Underwriters and previously
approved by the Company as provided below, but not for an aggregate number of
Underwritten Securities in excess of that specified in the applicable Terms
Agreement. The Underwriters will not have any responsibility for the validity or
performance of Delayed Delivery Contracts.
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You shall submit to the Company, at least two business days prior to the
Closing Time, the names of any institutional investors with which it is proposed
that the Company will enter into Delayed Delivery Contracts and the number of
Underwritten Securities to be purchased by each of them, and the Company will
advise you, at least one business day prior to the Closing Time, of the names of
the institutions with which the making of Delayed Delivery Contracts is approved
by the Company and the number of Underwritten Securities to be covered by each
such Delayed Delivery Contract.
The number of Underwritten Securities agreed to be purchased by the
several Underwriters pursuant to the applicable Terms Agreement shall be reduced
by the number of Underwritten Securities covered by Delayed Delivery Contracts,
as to each Underwriter as set forth in a written notice delivered by you to the
Company; provided, however, that the total number of Underwritten Securities to
be purchased by all Underwriters shall be the total number of Underwritten
Securities covered by the applicable Terms Agreement, less the number of
Underwritten Securities covered by Delayed Delivery Contracts.
4. COVENANTS AND AGREEMENTS OF THE COMPANY. The Company covenants with
the several Underwriters participating in the offering of Underwritten
Securities that:
(a) Immediately following the execution of the applicable Terms
Agreement, the Company will prepare a Prospectus Supplement setting forth the
number of Underwritten Securities covered thereby and their terms not otherwise
specified in the Prospectus or the applicable Warrant Agreement, if any, as the
case may be, pursuant to which the Underwritten Securities are being issued, the
names of the Underwriters participating in the offering and the number of
Underwritten Securities which each severally has agreed to purchase, the names
of the Underwriters acting as co-managers in connection with the offering, the
price at which the Underwritten Securities are to be purchased by the
Underwriters from the Company, the initial public offering price, if any, the
selling concession and reallowance, if any, any delayed delivery arrangements,
and such other information as you and the Company deem appropriate in connection
with the offering of the Underwritten Securities; and the Company will promptly
transmit copies of the Prospectus Supplement to the Commission for filing
pursuant to Rule 424(b) of the 1933 Act Regulations.
(b) The Company will advise you promptly of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of the institution of any proceedings for that purpose, and will
use its best efforts to prevent the issuance of any such stop order and to
obtain as soon as possible the lifting thereof, if issued. The Company will
advise you promptly of the transmittal to the Commission for filing of any
Prospectus Supplement or other supplement or amendment to the
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Prospectus or any document to be filed pursuant to the 0000 Xxx. The Company
will advise you promptly of any request by the Commission for any amendment of
or supplement to the Registration Statement or the Prospectus or for additional
information.
(c) If the Company elects to rely on Rule 434 under the 1933 Act
Regulations, the Company will prepare an abbreviated term sheet that complies
with the requirements of Rule 434 under the 1933 Act Regulations and the Company
will provide the Underwriters with copies of the form of Rule 434 Prospectus, in
such number as the Underwriters may reasonably request, and file or transmit for
filing with the Commission the form of Prospectus complying with Rule 434(c)(2)
of the 1933 Act in accordance with Rule 424(b) of the 1933 Act by the close of
business in New York on the business day immediately succeeding the date of the
Terms Agreement.
(d) At any time when the Prospectus is required to be delivered under the
1933 Act or the 1934 Act in connection with sales of the Underwritten
Securities, the Company will give you notice of its intention to file any
amendment to the Registration Statement or any amendment or supplement to the
Prospectus, whether pursuant to the 1933 Act, 1934 Act or otherwise, and will
furnish you with copies of any such amendment or supplement a reasonable amount
of time prior to such proposed filing, and will not file any such amendment or
supplement or other documents in a form to which you or counsel for the
Underwriters shall reasonably object in writing or which is not in material
compliance with the 1933 Act, the 1933 Act Regulations, the 1934 Act or the 1934
Act Regulations as applicable.
(e) The Company will deliver to each Underwriter a signed copy of the
Registration Statement as originally filed and of each amendment thereto
(including exhibits filed therewith and documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 0000 Xxx) and will also
deliver to such Underwriter a conformed copy of the Registration Statement as
originally filed and of each amendment thereto (including documents incorporated
by reference but without exhibits).
(f) The Company will furnish to each Underwriter, from time to time
during the period when the Prospectus is required to be delivered under the 1933
Act or the 1934 Act in connection with sales of the Underwritten Securities,
such number of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request for the purposes contemplated by the 1933
Act, the 1933 Act Regulations, the 1934 Act or the 1934 Act Regulations.
(g) If at any time after the effective date of the Registration Statement
when a prospectus relating to the Underwritten Securities is required to be
delivered under the 1933 Act or the 1934 Act any event relating to or affecting
the Company occurs as a result of which the Prospectus or any other prospectus
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as then in effect would include an untrue statement of a material fact, or omit
to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or if it
is necessary at any time to amend the Registration Statement or the Prospectus
to comply with the 1933 Act or the 1934 Act, the Company will promptly notify
you thereof and will amend or supplement the Registration Statement or the
Prospectus to correct such statement or omission whether by filing documents
pursuant to the 1933 Act, the 1934 Act or otherwise, as may be necessary to
correct such untrue statement or omission or to make the Registration Statement
and Prospectus comply with such requirements, and the Company will furnish to
the Underwriters a reasonable number of copies of such amendment or supplement.
(h) The Company will cooperate with the Underwriters to enable the
Underwritten Securities, the Warrant Securities, if any, and the Common Shares
issuable upon conversion of the Preferred Shares or the Depositary Shares, if
any, to be qualified for sale under the securities laws and real estate
syndication laws of such jurisdictions as you may designate and at the request
of the Underwriters will make such applications and furnish such information as
may be required of it as the issuer of the Underwritten Securities, the Warrant
Securities, if any, and the Common Shares issuable upon conversion of the
Preferred Shares or the Depositary Shares, if any, for that purpose; provided,
however, that the Company shall not be required to qualify to do business or to
file a general consent to service of process in any such jurisdiction. The
Company will, from time to time, prepare and file such statements and reports as
are or may be required of it as the issuer of the Underwritten Securities, the
Warrant Securities, if any, and the Common Shares issuable upon conversion of
the Preferred Shares or the Depositary Shares, if any, to continue such
qualifications in effect for so long a period as the Underwriters may reasonably
request for the distribution of the Underwritten Securities; and in each
jurisdiction in which the Underwritten Securities, the Warrant Securities, if
any, and the Common Shares issuable upon conversion of the Preferred Shares or
the Depositary Shares, if any, 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 so long as may be required for the
distribution of the Underwritten Securities, the Warrant Securities, if any, and
the Common Shares issuable upon conversion of the Preferred Shares or the
Depositary Shares, if any; provided, however, that the Company shall not be
obligated to qualify as a foreign corporation in any jurisdiction where it is
not so qualified.
(i) With respect to each sale of Underwritten Securities, the Company
will make generally available to its security holders as soon as practicable,
but in any event no later than 60 days after the close of the period covered
thereby, an earnings statement (in
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form complying with the provisions of Rule 158 of the 1933 Act Regulations)
which will be in reasonable detail (but which need not be audited) and which
will comply with Section 11(a) of the 1933 Act covering a period of at least
twelve months beginning not later than the first day of the Company's fiscal
quarter next following the "effective date" (as defined in said Rule 158) of the
Registration Statement.
(j) The Company will furnish to its shareholders annual reports
containing financial statements certified by independent public accountants and
with quarterly summary financial information in reasonable detail which may be
unaudited. During the period of five years from the date hereof, the Company
will deliver to you and, upon request, to each of the other Underwriters, (i)
copies of each annual report of the Company and each other report furnished by
the Company to its shareholders; and will deliver to you, (ii) as soon as they
are available, copies of any other reports (financial or other) which the
Company shall publish or otherwise make available to any of its security holders
as such, and (iii) as soon as they are available, copies of any reports and
financial statements furnished to or filed with the Commission or any national
securities exchange. In the event the Company has active subsidiaries, such
financial statements will be on a consolidated basis to the extent the accounts
of the Company and its subsidiaries are consolidated in reports furnished to its
shareholders generally. Separate financial statements shall be furnished for all
subsidiaries whose accounts are not consolidated but which at the time are
significant subsidiaries as defined in the 1933 Act Regulations.
(k) The Company will use the net proceeds received by it from the sale of
Underwritten Securities in the manner specified in the Prospectus under "Use of
Proceeds."
(l) The Company will use its best efforts to continue to meet the
requirements to qualify as a "real estate investment trust" under the Code for
the taxable year in which sales of the Underwritten Securities are to occur.
(m) The Company, during the period when the Prospectus is required to be
delivered under the 1933 Act or the 1934 Act in connection with sales of the
Underwritten Securities, will file promptly all documents required to be filed
with the Commission pursuant to Section 13, 14 or 15 of the 1934 Act within the
time periods prescribed by the 1934 Act and the 1934 Act Regulations.
(n) The Company hereby agrees that, without the prior written consent of
Xxxxxx Xxxxxxx & Co. Incorporated on behalf of the Underwriters, it will not,
during the period ending [180] days after the date of the Prospectus, (i) 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
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purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or (ii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of the Common Stock, whether any such transaction described in
clause (i) or (ii) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) the Securities to be sold hereunder, (B) the issuance by the Company of
shares of Common Stock upon the exercise of an option or warrant or the
conversion of a security outstanding on the date hereof of which the
Underwriters have been advised in writing or (C) the grant of options pursuant
to the Company's Stock Option Plan, the shares of Common Stock to be issued
pursuant to the Company's Dividend Reinvestment Plan or pursuant to other
employee benefit plans.
(o) If the Preferred Shares or Depositary Shares are convertible into
Common Shares or if Warrants are issued, the Company will reserve and keep
available at all times, free of preemptive rights or other similar rights, a
sufficient number of Common Shares or Preferred Shares, as the case may be, for
the purpose of enabling the Company to satisfy any obligations to issue such
shares upon conversion of the Preferred Shares or the Depositary Shares, as the
case may be, or upon exercise of the Warrants.
(p) If the Preferred Shares or Depositary Shares are convertible into
Common Shares or if Warrants are exercised, the Company will use its best
efforts to list the Common Shares issuable upon conversion of the Preferred
Shares or Depositary Shares or upon exercise of the Warrants on the New York
Stock Exchange or such other national exchange on which the Company's Common
Shares are then listed.
(q) The Company has complied and will comply with all of the provisions
of Florida H.B. 1771, Section 1, Paragraph 17,130 of the Florida Securities and
Investors Act, and all regulations thereunder relating to issuers doing business
with Cuba.
5. PAYMENT OF EXPENSES. Whether or not the transactions contemplated in
this Agreement are consummated or this Agreement is terminated, to pay or cause
to be paid all expenses incident to the performance of its obligations under
this Agreement or the applicable Terms Agreement, including: (i) the fees,
disbursements and expenses of the Company's counsel and the Company's
accountants in connection with the registration and delivery of the Securities
and the Warrant Securities, if any, under the Securities Act and all other fees
or expenses in connection with the preparation and filing of the Registration
Statement, any preliminary prospectus, the Prospectus and amendments and
supplements to any of the foregoing, including all printing costs associated
therewith, and
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the mailing and delivering of copies thereof to the Underwriters and dealers, in
the quantities hereinabove specified, (ii) all costs and expenses related to the
transfer and delivery of the Securities and the Warrant Securities, if any, to
the Underwriters, including any transfer or other taxes payable thereon, (iii)
the cost of printing or producing any Blue Sky or Legal Investment memorandum in
connection with the offer and sale of the Securities and the Warrant Securities,
if any, under state securities laws and all expenses in connection with the
qualification of the Securities and the Warrant Securities, if any, for offer
and sale under state securities laws and real estate syndication laws as
provided in Section 4(g) hereof, including filing fees and the reasonable fees
and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky or Legal Investment
memorandum, (iv) all filing fees and the reasonable fees and disbursements of
counsel to the Underwriters incurred in connection with the review and
qualification of the offering of the Securities and the Warrant Securities, if
any, by the National Association of Securities Dealers, Inc., (v) all fees and
expenses in connection with the preparation and filing of the registration
statement on Form 8-A relating to the Common Stock and all costs and expenses
incident to listing the Securities and the Warrant Securities, if any, on the
NYSE, (vi) the cost of printing certificates representing the Securities and the
Warrant Securities, if any, (vii) the costs and charges of any transfer agent,
registrar or depositary, (viii) the costs and expenses of the Company relating
to investor presentations on any "road show" undertaken in connection with the
marketing of the offering of the Securities and the Warrant Securities, if any,
including, without limitation, expenses associated with the production of road
show slides and graphics, fees and expenses of any consultants engaged in
connection with the road show presentations with the prior approval of the
Company, travel and lodging expenses of the representatives and officers of the
Company and any such consultants, and the cost of any aircraft chartered in
connection with the road show, and (ix) all other costs and expenses incident to
the performance of the obligations of the Company hereunder for which provision
is not otherwise made in this Section. It is understood, however, that except as
provided in this Section, Section 7 entitled "Indemnity and Contribution", and
the last paragraph of Section 9 below, the Underwriters will pay all of their
costs and expenses, including fees and disbursements of their counsel, stock
transfer taxes payable on resale of any of the Shares by them and any
advertising expenses connected with any offers they may make.
6. INDEMNITY AND CONTRIBUTION. (a) The Company agrees to indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
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expenses reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any amendment
thereof, any preliminary prospectus or the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through you expressly
for use therein.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the Registration
Statement and each person, if any, who controls the Company within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act to
the same extent as the foregoing indemnity from the Company to such Underwriter,
but only with reference to information relating to such Underwriter furnished to
the Company in writing by such Underwriter through you expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 6(a) or 6(b), such person (the "indemnified party")
shall promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all
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such fees and expenses shall be reimbursed as they are incurred. Such firm shall
be designated in writing by Xxxxxx Xxxxxxx & Co. Incorporated, in the case of
parties indemnified pursuant to Section 6(a), and by the Company, in the case of
parties indemnified pursuant to Section 6(b). The indemnifying party shall not
be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at anytime an indemnified party shall
have requested an indemnifying party to reimburse the indemnified party for fees
and expenses of counsel as contemplated by the second and third sentences of
this paragraph, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such proceeding.
(d) To the extent the indemnification provided for in Section 6(a) or
6(b) is unavailable to an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on the
other hand from the offering of the Underwritten Securities or (ii) if the
allocation provided by clause 6(d)(i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause 6(d)(i) above but also the relative fault of the Company
on the one hand and of the Underwriters on the other hand in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Underwriters
on the other hand in connection with the offering of the Underwritten Securities
shall be deemed to be in the same respective proportions as the net proceeds
from the offering of the Underwritten Securities (before deducting expenses)
received by the Company and the total underwriting discounts and
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commissions received by the Underwriters, in each case as set forth in the table
on the cover of the Prospectus, bear to the aggregate Public Offering Price of
the Underwritten Securities. The relative fault of the Company on the one hand
and the Underwriters on the other hand shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Underwriters' respective obligations to
contribute pursuant to this Section 6 are several in proportion to the
respective number of Underwritten Securities they have purchased hereunder, and
not joint.
(e) The Company and the Underwriters agree that it would not be just or
equitable if contribution pursuant to this Section 6 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in Section 6(d). The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 6, no Underwriters shall be required to contribute
any amount in excess of the amount by which the total price at which the
Underwritten Securities, underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages that such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The remedies provided for in this Section 6 are
not exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this Section 6
and the representations, warranties and other statements of the Company
contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of any Underwriter or any person controlling any Underwriter or
by or on behalf of the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Underwritten Securities.
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7. SURVIVAL OF INDEMNITIES, REPRESENTATION, WARRANTIES, ETC. The
respective indemnities, covenants, agreements, representations, warranties and
other statements of the Company, and the several Underwriters, as set forth in
this Agreement or the applicable Terms Agreement or made by them respectively,
pursuant to this Agreement or the applicable Terms Agreement, shall remain in
full force and effect, regardless of any investigation made by or on behalf of
any Underwriter or the Company or any of their officers or directors or any
controlling person, and shall survive delivery of and payment for the
Underwritten Securities.
8. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective obligations of
the several Underwriters to purchase Underwritten Securities pursuant to the
applicable Terms Agreement are subject to the accuracy, at and (except as
otherwise stated herein) as of the date hereof, the Representation Date, Closing
Time and at each Date of Delivery, of the representations and warranties made
herein by the Company, to the accuracy of the statements of the Company's
officers or directors in any certificate furnished pursuant to the provisions
hereof, to compliance at and as of such Closing Time and at each Date of
Delivery by the Company, with its covenants and agreements herein contained and
other provisions hereof to be satisfied at or prior to such Closing Time, or
Date of Delivery, as the case may be, and to the following additional
conditions:
(a) At Closing Time, (i) no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been initiated or, to the
knowledge of the Company or you, threatened by the Commission, (ii) if
Preferred Shares or Depositary Shares are being offered, the rating
assigned by any nationally recognized statistical rating organization to
any preferred stock of the Company as of the date of the applicable Terms
Agreement shall not have been lowered since such date nor shall any such
rating organization have publicly announced that it has placed any
preferred stock of the Company on what is commonly termed a "watch list"
for possible downgrading, and (iii) there shall not have come to your
attention any facts that would cause you to believe that the Prospectus,
together with the applicable Prospectus Supplement, at the time it was
required to be delivered to purchasers of the Underwritten Securities,
contained any untrue statement of a material fact or omitted to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances existing at such time, not misleading.
(b) At the time of execution of the applicable Terms Agreement,
you shall have received from Price Waterhouse LLP a letter, dated the
date of such execution, in form and substance satisfactory to you, to the
effect that:
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(i) they are independent accountants with respect to the
Company and its subsidiaries and DDG within the meaning of the
1933 Act and the 1933 Act Regulations; (ii) it is their opinion
that the consolidated financial statements and supporting
schedules of the Company and DDG included or incorporated by
reference in the Registration Statement and the Prospectus and
covered by their opinions therein comply in form in all material
respects with the applicable accounting requirements of the 1933
Act and the 1934 Act, and the related published rules and
regulations; (iii) it is their opinion that the financial
statements of the properties acquired or proposed to be acquired
by the Company included in the Company's Forms 8-K dated May 8,
1995, November 3, 1995 and May 31, 1996 each of which is
incorporated by reference in the Company's Registration Statement
and covered by their opinions therein comply as to form with the
applicable accounting requirements of the 1933 Act and the 1934
Act with respect to real estate operations acquired or to be
acquired; (iv) they have performed limited procedures, not
constituting an audit, including a reading of the latest available
unaudited interim consolidated financial statements of the Company
and its subsidiaries, a reading of the minute books of the Company
and its subsidiaries, inquiries of certain officials of the
Company and its subsidiaries who have responsibility for financial
and accounting matters and such other inquiries and procedures as
may be specified in such letter, and on the basis of such limited
review and procedures nothing came to their attention that caused
them to believe that (A) the unaudited interim consolidated
financial statements and financial statement schedules, if any, of
the Company included or incorporated by reference in the
Registration Statement and the Prospectus do not comply as to form
in all material respects with the applicable accounting
requirements of the 1934 Act and the related published rules and
regulations thereunder or that any material modification should be
made to the unaudited condensed interim financial statements
included in or incorporated by reference in the Registration
Statement and the Prospectus for them to be in conformity with
generally accepted accounting principles, (B) the unaudited pro
forma condensed financial statements included in the Company's
aforementioned Forms 8-K, do not comply as to form in all material
respects with the applicable accounting requirements of Rule 11-02
of Regulation S-X under the 1933 Act or that the pro forma
adjustments have not been properly applied to the historical
amounts in the compilation of such statements, (C) the information
included or incorporated by reference in the Registration
Statement and the applicable Prospectus under the caption
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"Selected Consolidated Financial Data" did not conform in all
material respects with the disclosure requirements of item 301 of
Regulation S-K, or (D) at a specified date not more than three
days prior to the date of the applicable Terms Agreement, there
has been any change in the capital stock of the Company or in the
consolidated long term debt of the Company or any decrease in the
net assets of the Company, as compared with the amounts shown in
the most recent consolidated balance sheet included or
incorporated by reference in the Registration Statement and the
Prospectus or, during the period from the date of the most recent
consolidated statement of operations of the Company included or
incorporated by reference in the Registration Statement and the
Prospectus to a specified date not more than three days prior to
the date of the applicable Terms Agreement, there were any
decreases, as compared with the corresponding period in the
preceding year, in consolidated revenues, or decrease in
consolidated net income or consolidated net income per share of
the Company, except in all instances for changes, increases or
decreases which the Registration Statement and the Prospectus
disclose have occurred or may occur; and (v) in addition to the
audit referred to in their opinions and the limited procedures
referred to in clause (iv) above, they have carried out certain
specified procedures, not constituting an audit, with respect to
certain amounts, percentages and financial information which are
included or incorporated by reference in the Registration
Statement and the Prospectus and which are specified by you, and
have found such amounts, percentages and financial information to
be in agreement with the relevant accounting, financial and other
records of the Company and its subsidiaries identified in such
letter.
(c) At Closing Time, you shall have received from Price Waterhouse
LLP a letter, dated Closing Time, to the effect that such accountants
reaffirm, as of Closing Time, and as though made on such Closing Time,
the statements made in the letter furnished by such accountants pursuant
to paragraph (b) of this Section 8, except that the specified date will
be a date not more than three days prior to the Closing Date.
(d) At Closing Time, you shall have received from Xxxxx &
Xxxxxxxxx LLP, counsel for the Company, an opinion, dated as of Closing
Time, to the effect that:
(i) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the
State of Ohio.
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(ii) The Company has full corporate power and authority to
own, lease and operate its properties and to conduct its business
as described in the Prospectus.
(iii) The Company is duly qualified to transact business
and is in good standing in each jurisdiction in which it owns real
property except where the failure to qualify and be in good
standing would not have a material adverse effect on the
condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise.
(iv) If the Company has one or more significant
subsidiaries, as defined in Rule 405 of the 1933 Act (each a
"Significant Subsidiary"), each Significant Subsidiary has been
duly incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation,
has corporate power and authority to own, lease and operate its
properties and to conduct its business, and is duly qualified to
transact business and is in good standing in each jurisdiction in
which it owns real property, except where the failure to so
qualify and be in good standing would not have a material adverse
effect on the condition, financial or otherwise, or the earnings,
business affairs or business prospects of the Company and its
Subsidiaries considered as one enterprise.
(v) The number of issued and outstanding shares of capital
stock of the Company is as set forth in the Prospectus under
"Capitalization" and the outstanding shares of capital stock have
been duly authorized, validly issued, fully paid and
non-assessable. All of the issued and outstanding capital stock of
the Company's subsidiaries have been duly authorized and validly
issued, is fully paid and non-assessable and, to the best of such
counsel's knowledge, is owned by the Company free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or
equity.
(vi) The Underwritten Securities being sold pursuant to the
applicable Terms Agreement and, if applicable, the deposit of the
Preferred Shares in accordance with the provisions of a Deposit
Agreement, have been duly and validly authorized by all necessary
corporate action and such Underwritten Securities have been duly
authorized for issuance and sale pursuant to this Agreement and
such Underwritten Securities, when issued and delivered pursuant
to this Agreement against payment of the consideration therefor
specified in the applicable Terms Agreement or the Delayed
Delivery
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Contracts, the Underwritten Securities will be validly issued,
fully paid and non-assessable.
(vii) The issuance of the Underwritten Securities is not
subject to preemptive or other similar rights arising by operation
of law or, to the best of their knowledge, otherwise.
(viii) If applicable, the Warrants have been duly
authorized and, when issued and delivered pursuant to this
Agreement and countersigned by the Warrant Agent as provided in
the Warrant Agreement, will have been duly executed,
countersigned, issued and delivered and will constitute valid and
legally binding obligations of the Company entitled to the
benefits provided by the Warrant Agreement under which they are to
be issued except as enforcement thereof may be limited by
bankruptcy, insolvency or other similar laws relating to or
affecting enforcement of creditors' rights generally or by general
equity principles (regardless of whether enforcement is considered
in a proceeding in equity or at law).
(ix) If applicable, the Common Shares issuable upon
conversion of any of the Preferred Shares or Depositary Shares or
upon the exercise of the Warrant Securities, have been duly and
validly authorized and reserved for issuance upon such exercise by
all necessary corporate action and such shares, when issued upon
such exercise, will be duly and validly issued and will be fully
paid and non-assessable, and the issuance of such shares upon such
exercise will not be subject to preemptive or other similar rights
arising by operation of law or, to the best of such counsel's
knowledge, otherwise.
(x) The applicable Warrant Agreement, if any, and the
applicable Deposit Agreement, if any, have been duly authorized,
executed and delivered by the Company, and (assuming due
authorization, execution and delivery by the Warrant Agent in the
case of the Warrant Agreement, and the Preferred Shares
Depositary, in the case of the Deposit Agreement) constitutes a
valid and legally binding agreement of the Company enforceable in
accordance with its terms except as enforcement thereof may be
limited by bankruptcy, insolvency or other similar laws relating
to or affecting enforcement of creditors' rights generally or by
general equity principles (regardless of whether enforcement is
considered in a proceeding in equity or at law); and the Warrant
Agreement, if any, and the Deposit Agreement, if any, each
conforms in all material respects to all statements relating
thereto contained in the Prospectus.
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(xi) If applicable, upon execution and delivery thereof
pursuant to the terms of the Deposit Agreement, the persons in
whose names the Depositary Receipts are registered will be
entitled to the rights specified therein and in the Deposit
Agreement.
(xii) Each of this Agreement, the applicable Terms
Agreement and the Delayed Delivery Contracts, if any, has been
duly authorized, executed and delivered by the Company.
(xiii) The Registration Statement is effective under the
1933 Act and, to the best of their knowledge, no stop order
suspending the effectiveness of the Registration Statement has
been issued under the 1933 Act or proceedings therefor initiated
or threatened by the Commission.
(xiv) The Registration Statement and the Prospectus,
excluding the documents incorporated by reference therein, as of
their respective effective or issue dates, comply as to form in
all material respects with the requirements for registration
statements on Form S-3 under the 1933 Act and the 1933 Act
Regulations. If applicable, the Rule 434 Prospectus conforms to
the requirements of Rule 434 of the 1933 Act Regulations in all
material respects. It being understood, however, that no opinion
need be rendered with respect to the financial statements,
schedules and other financial and statistical data included or
incorporated by reference in the Registration Statement or the
Prospectus.
(xv) Each document filed pursuant to the 1934 Act (other
than the financial statements, schedules and other financial and
statistical data included therein, as to which no opinion need be
rendered) and incorporated or deemed to be incorporated by
reference in the Prospectus complied when so filed as to form in
all material respects with the 1934 Act and the 1934 Act
Regulations.
(xvi) If applicable, the relative rights, preferences,
interests and powers of the Preferred Shares or Depositary Shares,
as the case may be, are as set forth in the Articles of
Incorporation relating thereto, and all such provisions are valid
under Ohio Law; and, as applicable, the form of certificate used
to evidence the Preferred Shares being represented by the
Depositary Shares and the form of certificate used to evidence the
related Depositary Receipts are in due and proper form under Ohio
Law and comply with all applicable statutory requirements.
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(xvii) The Underwritten Securities, the Warrant Securities,
and the Common Shares issuable upon conversion of the Preferred
Shares or Depositary Shares, if applicable, conform in all
material respects to the statements relating thereto contained in
the Prospectus.
(xviii) Nothing has come to such counsel's attention that
would lead it to believe that the Registration Statement or any
amendment thereto (excluding the financial statements and
financial schedules included or incorporated by reference therein,
as to which such counsel need express no belief), at the time it
became effective or at the time an Annual Report on Form 10-K was
filed by the Company with the Commission (whichever is later), or
at the Representation Date, 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 or any amendment or supplement
thereto (excluding the financial statements and financial
schedules included or incorporated by reference therein, as to
which such counsel need express no belief), at the Representation
Date or at 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.
(xix) To the best of their knowledge, there are no legal or
governmental proceedings pending or threatened which are required
to be disclosed in the Prospectus, other than those disclosed
therein, and, to the best of their knowledge, all pending legal or
governmental proceedings to which the Company or any of its
subsidiaries is a party or of which any of the property of the
Company or its subsidiaries is the subject which are not described
in the Registration Statement, including ordinary routine
litigation incidental to the business, are, considered in the
aggregate, not material to the business of the Company and its
subsidiaries considered as one enterprise.
(xx) To the best of their knowledge, there are no
contracts, indentures, mortgages, loan agreements, notes, leases
or other instruments required to be described or referred to in
the Registration Statement or to be filed as exhibits thereto
other than those described or referred to therein or filed as
exhibits thereto, the descriptions thereof or references thereto
are correct in all material respects, and, to the best of their
knowledge, no default exists in the due performance
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31
or observance of any material obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument so described, referred
to or filed which would have a material adverse effect on the
condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise.
(xxi) No authorization, approval or consent of any court or
governmental authority or agency is required that has not been
obtained in connection with the consummation by the Company of the
transactions contemplated by this Agreement, the applicable Terms
Agreement, the applicable Deposit Agreement, if any, or the
applicable Warrant Agreement, if any, except such as may be
required under the 1933 Act, the 1934 Act, and state securities
laws or Blue Sky laws or real estate syndication laws; to the best
of their knowledge, the execution and delivery of this Agreement
and the Terms Agreement, and the Deposit Agreement, and the
consummation of the transactions contemplated herein and therein
and compliance by the Company with its obligations hereunder and
thereunder will not (A) constitute a breach of, or default under,
or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or its
subsidiaries pursuant to, any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Company or
any of its subsidiaries is a party or by which they may be bound
or to which any of the property or assets of the Company or any of
its subsidiaries is subject, except where such breach, default,
creation or imposition would not have a material adverse effect on
the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, (B) nor will such
action result in violation of the provisions of the Articles of
Incorporation or Code of Regulations or bylaws, as the case may
be, of the Company or its subsidiaries or any applicable law,
administrative regulation or administrative or court order or
decree.
(xxii) Neither the Company nor any of its subsidiaries is
required to be registered under the 1940 Act.
(xxiii) The information in the Prospectus, if applicable,
under the captions "Description of Common Shares," "Description of
Common Share Warrants," "Description of Preferred Shares,"
"Description of
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32
Depositary Shares," "Certain Anti-Takeover Provisions of Ohio Law"
and "Federal Income Tax Considerations," and, if applicable, any
similar matters set forth in the Prospectus Supplement under a
caption or captions to be set forth in such opinion, to the extent
that it constitutes matters of law or legal conclusions, has been
reviewed by them and is correct in all material respects.
(xxiv) The Company has qualified as a REIT for the taxable
years ended December 31, 1993, December 31, 1994 and December 31,
1995 and the Company is organized and operates in a manner that
will enable it to qualify to be taxed as a REIT under the Internal
Revenue Code of 1986, as amended (the "Code") for the taxable year
ended December 31, 1996 and thereafter provided the Company
continues to meet the asset composition, source of income,
shareholder diversification, distributions, record keeping, and
other requirements of the Code which are necessary for the Company
to qualify as a REIT.
(e) The Representatives shall have received from Xxxxx & Xxxx LLP,
counsel for the Underwriters, their opinion or opinions dated Closing
Time with respect to the matters set forth in (i), (vi) to (xiv),
inclusive, (xvi) to (xviii) of subsection (d) of this Section, and the
Company shall have furnished to such counsel such documents as they may
request for the purpose of enabling them to pass upon such matters.
In giving their opinion, Xxxxx & Wood LLP may rely as to matters
involving the laws of the State of Ohio upon the opinion of Xxxxx &
Xxxxxxxxx LLP. Xxxxx & Xxxxxxxxx LLP and Xxxxx & Wood LLP may rely (i) as
to the qualification of the Company or its subsidiaries to do business in
any state or jurisdiction, upon certificates of appropriate government
officials, and (ii) as to matters of fact, upon certificates and written
statements of officers and employees of and accountants for the Company
or its subsidiaries.
(f) Subsequent to the execution and delivery of this Agreement and
the Terms Agreement and prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not
indicate the direction of the possible change, in the rating
accorded any of the Company's securities by any "nationally
recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the Securities Act;
and
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(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations
of the Company and its subsidiaries, taken as a whole, from that
set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement)
that, in your judgment, is material and adverse and that makes it,
in your judgment, impracticable to market the Underwritten
Securities on the terms and in the manner contemplated in the
Prospectus.
(g) At the Closing Time (i) the Registration Statement and the
Prospectus shall contain all statements which are required to be stated
therein in accordance with the 1933 Act, and the Rules and Regulations
and in all material respects shall conform to the requirements of the
1933 Act, and the 1933 Act Regulations and neither the Registration
Statement nor the Prospectus shall contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading and no
action, suit or proceeding at law or in equity shall be pending or, to
the knowledge of the Company, threatened against the Company or its
subsidiaries which would be required to be set forth in the Registration
Statement and the Prospectus other than as set forth therein, (ii) there
shall not have been, since the date of the applicable Terms Agreement or
since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change in
the condition, financial or otherwise, of the Company and its
subsidiaries considered as one enterprise or in its earnings, business
affairs or business prospects, whether or not arising in the ordinary
course of business, from that set forth in the Registration Statement and
the Prospectus, (iii) no proceeding shall be pending or, to the knowledge
of the Company, threatened against the Company or its subsidiaries before
or by any Federal, state or other commission, board or administrative
agency wherein an unfavorable decision, ruling or finding would
materially and adversely affect the business, property, financial
condition or income of the Company and its subsidiaries considered as one
enterprise other than as set forth in the Registration Statement and the
Prospectus, (iv) neither the Company nor any of its subsidiaries shall be
in default in the performance or observance of any contract to which it
is a party, except such defaults that would not have a material adverse
effect on the condition, financial or otherwise, of the Company and its
subsidiaries considered as one enterprise or on the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise, (v) no stop order suspending the
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34
effectiveness of the Registration Statement shall have been issued under
the 1933 Act and no proceeding therefor shall have been instituted or
threatened by the Commission and (vi) you shall have received at Closing
Time a certificate of the President and the Chief Financial Officer of
the Company, dated as of Closing Time, evidencing compliance with the
provisions of this subsection (g). As used in this subsection (g), the
term "Prospectus" means the Prospectus in the form first used to confirm
sales of the Underwritten Securities.
(h) You shall have received certificates, dated Closing Time, of
the President and the Chief Financial Officer of the Company to the
effect that the representations and warranties of the Company contained
in Section 2(a) are true and correct with the same force and effect as
though expressly made at and as of Closing Time.
(i) The Company shall have furnished to you such additional
certificates as you may have reasonably requested as to the accuracy, at
and as of Closing Time, of the representations and warranties made herein
by them, as to compliance, at and as of Closing Time, by them with their
covenants and agreements herein contained and other provisions hereof to
be satisfied at or prior to Closing Time, and as to other conditions to
the obligations of the Underwriters hereunder.
(j) In the event the Underwriters exercise their option provided
in a Terms Agreement as set forth in Section 3 hereof to purchase all or
any portion of the Option Securities, the representations and warranties
of the Company contained herein and the statements in any certificates
furnished by the Company hereunder shall be true and correct as of each
Date of Delivery, and you shall have received:
(i) A letter from Price Waterhouse LLP in form and
substance satisfactory to you and dated such Date of Delivery,
substantially the same in scope and substance as the letter
furnished to you pursuant to Section 8(b), except that the
specified date in the letter furnished pursuant to this Section
8(i) shall be a date not more than three days prior to such Date
of Delivery.
(ii) The opinion of Xxxxx & Xxxxxxxxx LLP, counsel for the
Company, in form and substance satisfactory to Xxxxx & Wood LLP,
dated such Date of Delivery, relating to the Option Securities and
otherwise to the same effect as the opinion required by Section
8(d).
(iii) The opinion of Xxxxx & Xxxx LLP, counsel for the
Underwriters, dated such Date of Delivery,
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35
relating to the Options Securities and otherwise to the same
effect as the opinion required by Section 8(e).
(iv) A certificate, dated such Date of Delivery, of the
President and the Chief Financial Officer of the Company
confirming that the certificate or certificates delivered at
Closing Time pursuant to Section 8(f) and Section 8(g) remains or
remain true as of such Date of Delivery.
(v) Such additional certificates, dated such Date of
Delivery, as you may have reasonably requested pursuant to Section
8(h).
If any of the conditions hereinabove provided for in this Section shall
not have been satisfied when and as required to be satisfied, the applicable
Terms Agreement may be terminated by you by notifying the Company of such
termination in writing or by telegram at or prior to Closing Time, but you shall
be entitled to waive any of such conditions.
9. TERMINATION. (a) This Agreement (excluding the applicable Terms
Agreement) may be terminated for any reason at any time by the Company or by
you upon the giving of 30 days' written notice of such termination to the other
party hereto.
(b) You may also terminate the applicable Terms Agreement, by notice to
the Company, at any time at or prior to the Closing Time if (i) trading in any
securities of the Company shall have been suspended by the Commission or a
national securities exchange or if trading generally on the New York or
American Stock Exchanges shall have been suspended or minimum or maximum prices
shall have been established on either such exchange, or a banking moratorium
shall have been declared by New york or United States authorities; (ii) there
shall have been any material adverse change in the financial markets in the
United States or any outbreak or escalation of hostilities between the United
States and any foreign power, or of any other insurrention or armed conflict
involving the United States which, in your judgment, makes it impracticable or
inadvisable to offer or sell the Underwritten Securities; (iii) there shall
have been, since the date of the applicable Terms Agreement or since the
respective dates as to which information is given in the Registration Statement
and the Prospectus, any material adverse change in the condition (financial or
otherwise), or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise; (iv) there shall be
any litigation against the Company or the Properties, pending or threatened,
which, in the judgment of the Representatives, makes it impracticable or
inadvisable to offer or deliver the Underwritten Securities on the terms
contemplated by the Prospectus, or (v) if the rating assigned by any nationally
recognized statistical rating organization to any long-term debt securities of
the Company as of the date of the applicable Terms Agreement shall have been
lowered since such date or if any such rating organization shall have publicly
announced that it has placed any long-term debt securities of the Company on
what is commonly termed a "watch list" for possible downgrading. As used in
this Section 9(b), the term "Prospectus" means the Prospectus in the form first
used to confirm sales of the Underwritten Securities.
(c) In the event of any such termination, the covenants set forth in
Section 4 with respect to any offering of Underwritten Securities shall remain
in effect so long as any Underwriter owns any such Underwritten Securities
purchased from the Company pursuant to the applicable Terms Agreement.
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36
10. REIMBURSEMENT OF UNDERWRITERS. Notwithstanding any other provisions
hereof, if this Agreement or the applicable Terms Agreement shall be terminated
by you under Section 8, Section 9 or Section 12, the Company will bear and pay
the expenses specified in Section 5 hereof and, in addition to their obligations
pursuant to Section 6, hereof, except when you terminate this Agreement pursuant
to clause (a), (b)(i) or (b)(iii) of Section 9, the Company will reimburse the
reasonable out-of-pocket expenses of the several Underwriters (including
reasonable fees and disbursements of counsel for the Underwriters) incurred in
connection with this Agreement or the applicable Terms Agreement and the
proposed purchase of the Underwritten Securities, and promptly upon demand the
Company, will pay such amounts to you for and on behalf of such Underwriter. In
addition, the provisions of Section 6 shall survive any such termination.
11. DEFAULT BY THE COMPANY. If the Company shall fail at Closing Time to
sell and deliver the total number of Underwritten Securities which it is
obligated to sell pursuant to the applicable Terms Agreement, then such
agreement shall terminate without any liability on the part of any
non-defaulting party, other than obligations under Section 10 hereof. No action
taken pursuant to this Section 11 shall relieve the Company from liability, if
any, in respect of such default.
12. NOTICES. All communications hereunder shall be in writing and, if
sent to the Underwriters shall be mailed, delivered or telecopied and confirmed
to you, x/x Xxxxxx Xxxxxxx & Xx. Xxxxxxxxxxxx, at 0000 Xxxxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: _____________________, _______________, except that
notices given to an Underwriter pursuant to Section 6 hereof shall be sent to
such Underwriter at the address furnished by you or if sent to the Company shall
be mailed, delivered or telegraphed and confirmed at 00000 Xxxxxxx Xxxxxxxxx,
Xxxxxxxx Xxxxx, Xxxx 00000, Attention: Xxxxx X. Xxxxxxxx, President and Chief
Executive Officer.
13. SUCCESSORS. This Agreement and the applicable Terms Agreement shall
inure to the benefit of and be binding upon you and the Company and any
Underwriter who becomes a party to such Terms Agreement, the Company and their
respective successors and legal representatives. Nothing expressed or mentioned
in this Agreement or the applicable Terms Agreement is intended or shall be
construed to give any person other than the persons mentioned in the preceding
sentence any legal or equitable right, remedy or claim under or in respect of
this Agreement, or any provisions herein contained, this Agreement or such Terms
Agreement and all conditions and provisions hereof being intended to be and
being for the sole and exclusive benefit of such persons and for the benefit of
no other person; except that the representations, warranties, covenants,
agreements and indemnities of the Company, contained in this Agreement shall
also be for the benefit of the person or
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37
persons, if any, who control any Underwriter within the meaning of Section 15 of
the 1933 Act, and the indemnities given by the several Underwriters shall also
be for the benefit of each director of the Company, each of the Company's
officers who has signed the Registration Statement and the person or persons, if
any, who control the Company within the meaning of Section 15 of the 1933 Act.
14. APPLICABLE LAW. This Agreement and the applicable Terms 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.
Specified times of day refer to New York City time.
15. COUNTERPARTS. This Agreement and the applicable Terms Agreement may
be executed in one or more counterparts, and if executed in more than one
counterpart the executed counterparts shall constitute a single instrument.
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38
If the foregoing correctly sets forth our understanding, please indicate
your acceptance thereof in the space provided below for that purpose, whereupon
this letter and your acceptance shall constitute a binding agreement between us.
Very truly yours,
DEVELOPERS DIVERSIFIED REALTY
CORPORATION
By:______________________________________
Xxxxx X. Xxxxxxxx
President and
Chief Executive Officer
Accepted and delivered,
as of the date first above written:
XXXXXX XXXXXXX & CO. INCORPORATED
By: ___________________________________
Name:
Title:
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Exhibit A
DEVELOPERS DIVERSIFIED REALTY CORPORATION
(an Ohio corporation)
[Title of Securities]
TERMS AGREEMENT
---------------
Dated: , 1997
To: Developers Diversified Realty Corporation
00000 Xxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxxx, Xxxx 00000
Attention: Xx. Xxxxx X. Xxxxxxxx
President and Chief Executive Officer
Ladies and Gentlemen:
We (the "Underwriter") understand that Developers Diversified Realty
Corporation, an Ohio corporation (the "Company"), proposes to issue and sell the
number of its common shares, without par value, set forth below (the "Common
Shares") (such Common Shares being collectively hereinafter also referred to as
the "Underwritten Securities".) Subject to the terms and conditions set forth or
incorporated by reference herein, the Underwriter offers to purchase the number
of Initial Underwritten Securities (as defined in the Underwriting Agreement
referenced below) set forth below.
A-1
40
Number of Shares
of Initial
Underwriter Underwritten Securities
----------- -----------------------
Xxxxxx Xxxxxxx & Co. Incorporated
The Underwritten Securities shall have the following terms:
[COMMON SHARES]
Title of Securities:
Number of Shares:
Public offering price per share: $ [, plus accumulated dividends, if any, from , 19 .]
Purchase price per share: $ [, plus accumulated dividends, if any, from , 19 .]
Number of Option Securities, if any, that may be purchased by the Underwriters:
Delayed Delivery Contracts: [authorized] [not authorized]
[Date of Delivery:
Minimum Contract:
Maximum number of Shares:
Fee:]
Additional co-managers, if any:
Other terms:
Closing time, date and location:
WARRANTS
Number of Warrants to be issued:
Warrant Agent:
Issuable jointly with _______ Shares: [Yes] [No]
[Number of Warrants issued
with each ______ Share:]
[Detachable data:]
Date from which Warrants are exercisable:
Date on which Warrants expire:
Exercise price(s) of Warrants:
Initial public offering price: $
Purchase price: $
Title of Warrant Securities:
Principal amount purchasable upon exercise of one Warrant:
Interest rate: Payable:
Date of maturity:
[Delayed Delivery Contracts: [authorized] [not authorized]
[Date of delivery:
Minimum contract:
Maximum aggregate principal amount:
Fee: %]
Other terms:
[Closing date and location:]]
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41
All the provisions contained in the document attached as Annex A hereto
entitled "Developers Diversified Realty Corporation-Preferred Shares, Depositary
Shares, Common Shares and Warrants to Purchase Common Shares-Underwriting
Agreement Basic Provisions" are hereby incorporated by reference in their
entirety herein and shall be deemed to be a part of this Terms Agreement to the
same extent as if such provisions had been set forth in full herein. Terms
defined in such document are used herein as therein defined.
Please accept this offer by signing a copy of this Terms Agreement in the
space set forth below and returning the signed copy to us.
Very truly yours,
XXXXXX XXXXXXX & CO. INCORPORATED
By: _______________________________
Name:
Title:
Acting on behalf of themselves and the
other named Underwriters
Accepted:
DEVELOPERS DIVERSIFIED REALTY CORPORATION
By: _____________________________________
Name: Xxxxx X. Xxxxxxxx
Title: President and
Chief Executive Officer
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42
Exhibit B
DEVELOPERS DIVERSIFIED REALTY CORPORATION
(an Ohio corporation)
[Title of Securities]
DELAYED DELIVERY CONTRACT
-------------------------
___________ __, 19__
Developers Diversified Realty Corporation
00000 Xxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxxx, Xxxx 00000
Attention: Xx. Xxxxx X. Xxxxxxxx
President and Chief Executive Officer
Dear Sirs:
The undersigned hereby agrees to purchase from Developers Diversified
Realty Corporation (the "Company"), and the Company agrees to sell to the
undersigned on __________, 19__ (the "Delivery Date"),
of the Company's [insert title of security] (the "Securities"), offered by the
Company's Prospectus dated __________, 19__, as supplemented by its Prospectus
Supplement dated ___________, 19__, receipt of which is hereby acknowledged at a
purchase price of [$__________] [and, $__________ per Warrant, respectively] to
the Delivery Date, and on the further terms and conditions set forth in this
contract.
Payment for the Securities which the undersigned has agreed to purchase
on the Delivery Date shall be made to the Company or its order by certified or
official bank check in New York Clearing House funds at the office of
, on the Delivery Date, upon delivery to
the undersigned of the Securities to be purchased by the undersigned in
definitive form and in such denominations and registered in such names as the
undersigned may designate by written or telegraphic communication addressed to
the Company not less than five full business days prior to the Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for Securities on the Delivery Date shall be subject only to the conditions that
(1) the purchase of Securities to be made by
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43
the undersigned shall not on the Delivery Date be prohibited under the laws of
the jurisdiction to which the undersigned is subject and (2) the Company, on or
before __________, 19__, shall have sold to the Underwriters of the Securities
(the "Underwriters") such principal amount of the Securities as is to be sold to
them pursuant to the Terms Agreement dated __________, 19__ between the Company
and the Underwriters. The obligation of the undersigned to take delivery of and
make payment for Securities shall not be affected by the failure of any
purchaser to take delivery of and make payments for Securities pursuant to other
contracts similar to this contract. The undersigned represents and warrants to
you that its investment in the Securities is not, as of the date hereof,
prohibited under the laws of any jurisdiction to which the undersigned is
subject and which govern such investment.
Promptly after completion of the sale to the Underwriters, the Company
will mail or deliver to the undersigned at its address set forth below notice to
such effect, accompanied by a copy of the opinion of counsel for the Company
delivered to the Underwriters in connection therewith.
By the execution hereof, the undersigned represents and warrants to the
Company that all necessary action for the due execution and delivery of this
contract and the payment for and purchase of the Securities has been taken by it
and no further authorization or approval of any governmental or other regulatory
authority is required for such execution, delivery, payment or purchase, and
that, upon acceptance hereof by the Company and mailing or delivery of a copy as
provided below, this contract will constitute a valid and binding agreement of
the undersigned in accordance with its terms.
This contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
It is understood that the Company will not accept Delayed Delivery
Contracts for a number of Securities in excess of ________ and that the
acceptance of any Delayed Delivery Contract is in the Company's sole discretion
and, without limiting the foregoing, need not be on a first-come, first-served
basis. If this contract is acceptable to the Company, it is requested that the
Company sign the form of acceptance on a copy hereof and mail or deliver a
signed copy hereof to the undersigned at its address set forth below. This will
become a binding contract between the Company and the undersigned when such copy
is so mailed or delivered.
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44
This Agreement shall be governed by the laws of the State of New York.
Yours very truly,
-----------------------------
(Name of Purchaser)
By
---------------------------
(Title)
-----------------------------
-----------------------------
(Address)
Accepted as of the date first above written.
DEVELOPERS DIVERSIFIED REALTY CORPORATION
By
-------------------------
(Title)
PURCHASER-PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone number of the representative of the Purchaser with
whom details of delivery on the Delivery Date may be discussed are as follows:
(Please print.)
Telephone No.
(including
Name Area Code)
---- ----------
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