Exhibit 1.1
3,500,000 Shares
CAPITAL TRUST, INC.
CLASS A COMMON STOCK, PAR VALUE $0.01 PER SHARE
UNDERWRITING AGREEMENT
July 22, 2004
July 22, 2004
Xxxxxx Xxxxxxx & Co. Incorporated
Bear, Xxxxxxx & Co. Inc.
Xxxxxxxxx & Company, Inc.
JMP Securities LLC
as the Managers of the several Underwriters
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
Capital Trust, Inc., a Maryland corporation (the "Company"), proposes to
issue and sell to the several Underwriters named in Schedule I attached hereto
(the "Underwriters"), and certain stockholders of the Company (the "Selling
Stockholders") named in Schedule II attached hereto severally propose to sell to
the several Underwriters, an aggregate of 3,500,000 shares of Class A Common
Stock, par value $0.01 per share (the "Class A Common Stock") of the Company
(the "Firm Shares"), of which 1,363,289 shares are to be issued and sold by the
Company and 2,136,711 shares are to be sold by the Selling Stockholders, each
Selling Stockholder selling the amount set forth opposite such Selling
Stockholder's name in Schedule II attached hereto.
The Company also proposes to issue and sell to the several Underwriters
not more than an additional 525,000 shares of its Class A Common Stock (the
"Additional Shares") if and to the extent that you, as Managers of the offering,
shall have determined to exercise, on behalf of the Underwriters, the right to
purchase such shares of Class A Common Stock granted to the Underwriters in
Section 3 hereof. The Firm Shares and the Additional Shares are hereinafter
collectively referred to as the "Shares." The Company and the Selling
Stockholders are hereinafter sometimes collectively referred to as the
"Sellers."
The Company has filed with the Securities and Exchange Commission (the
"Commission") (i) a registration statement on Form S-3 (File No. 333-111261),
including a base prospectus, relating to the portion of the Shares proposed to
be issued and sold by the Company as described herein (as amended, including the
information deemed to be part of such registration and the exhibits thereto, as
of the date hereof, the "Company Registration Statement"), and (ii) a
registration statement of Form S-3 (File No. 333-106970), including a base
prospectus, relating to the portion of the Shares proposed to be sold by the
Selling Stockholders as described herein (as amended, including the information
incorporated by reference or deemed to be part of the registration statement and
the exhibits thereto, as of the date hereof, the "Selling Stockholder
Registration Statement" and, together with the Company Registration Statement,
the "Registration Statements"). The Registration
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Statements have been declared effective by the Commission; no post-effective
amendment to such Registration Statements has been filed as of the date of this
Agreement (excluding amendments as a result of any filings by the Company under
the Securities Exchange Act of 1934, as amended, including the rules and
regulations promulgated thereunder (the "Exchange Act")). A final prospectus
supplement relating to the Shares, the terms of the offering thereof and the
other matters set forth therein has been prepared and will be filed pursuant to
Rule 424 under the Securities Act in the form first used to confirm sales of the
Shares (the "Prospectus Supplement"). The base prospectuses included in the
Registration Statements, as supplemented by the Prospectus Supplement, are
herein collectively called the "Prospectus," in each case including the
documents filed by the Company with the Commission pursuant to the Exchange Act,
that are incorporated by reference therein. The term "preliminary prospectus" as
used in this Agreement shall mean each preliminary prospectus used in connection
with the marketing of the Shares, including the preliminary prospectus
supplement dated as of July 16, 2004 and filed with the Commission on July 16,
2004 pursuant to Rule 424 under the Securities Act of 1933, as amended,
including the rules and regulations promulgated thereunder (the "Securities
Act") and any base prospectuses used with any such preliminary prospectus
supplement in connection with the marketing of Shares, in each case as any of
the foregoing may be amended or supplemented by the Company. If the Company has
filed an abbreviated registration statement to register additional shares of
Class A Common Stock pursuant to Rule 462(b) under the Securities Act (the "Rule
462 Registration Statement"), then any reference herein to the term
"Registration Statements" shall be deemed to include such Rule 462 Registration
Statement (including, in the case of all references to the Registration
Statements and the Prospectus, documents incorporated therein by reference).
1. Representations and Warranties of the Company. The Company represents
and warrants to and agrees with each of the Underwriters and EOP (as hereinafter
defined) that:
(a) The Registration Statements have each become effective; no stop
order suspending the effectiveness of the Registration Statements is in effect,
and no proceedings for such purpose are pending before or, to the knowledge of
the Company, threatened by the Commission.
(b) (i) Each document filed or to be filed pursuant to the Exchange Act
and incorporated by reference in the Prospectus complied or will comply when so
filed in all material respects with the Exchange Act and the applicable rules
and regulations of the Commission thereunder, (ii) the Company has satisfied the
conditions for use of Form S-3, as set forth in the general instructions
thereto, with respect to the Registration Statements, (iii) the Registration
Statements, when such Registration Statements became effective, did not contain
and, as amended or supplemented, if applicable, will not on the Closing Date or
the Option Closing Date (each, as hereinafter defined) contain any 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 except
that the representations and warranties set forth in clause (iii) do not apply
to statements or omissions in the Registration Statements based upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein or based upon information
relating to any Selling Stockholder furnished to the Company in writing by such
Selling Stockholder expressly for use therein, (iv) the Registration Statements
as of their effective dates and the Prospectus as of its filing date complied
and, as amended or supplemented, if applicable, will comply on the Closing Date
or the Option Closing
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Date in all material respects with the Securities Act and the applicable rules
and regulations of the Commission thereunder, (v) the Prospectus as of its
filing date did not contain and, as amended or supplemented, if applicable, will
not on the Closing Date or the Option Closing Date contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except that the representations and warranties set forth
in clause (v) do not apply to statements or omissions in the Prospectus based
upon information relating to any Underwriter furnished to the Company in writing
by such Underwriter through you expressly for use therein or based upon
information relating to any Selling Stockholder furnished to the Company in
writing by such Selling Stockholder expressly for use therein, and (vi) the
Company has filed all reports required to be filed pursuant to the Securities
Act, the Exchange Act, the Xxxxxxxx-Xxxxx Act of 2002 (the "Xxxxxxxx-Xxxxx
Act"), the National Association of Securities Dealers, Inc. (the "NASD") and the
New York Stock Exchange ("NYSE").
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of Maryland, has the
corporate power and authority to own its property and to conduct its business as
described in the Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not have
a material adverse effect on the Company and its subsidiaries, taken as a whole.
(d) Each subsidiary of the Company has been duly incorporated or
otherwise formed, is validly existing in good standing under the laws of the
jurisdiction of its incorporation or formation, has the power and authority to
own its property and to conduct its business as described in the Prospectus and
is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole; all of the issued shares
of capital stock or other equity interests (whether membership, partnership or
otherwise) of each subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and are owned directly
by the Company or indirectly through one of its wholly-owned subsidiaries, free
and clear of all liens, encumbrances, equities or claims.
(e) (i) The Company owns the following percentage of the limited
partnership interests in CT Mezzanine Partners II LP ("Fund II"): 5.38235%; and
the Company owns 40,000 shares of common stock of CT Mezzanine Partners III,
Inc. ("Fund III") (each, a "Fund" and, collectively, the "Funds").
(ii) Fund II is solely managed by the Company's wholly-owned
subsidiary, CT Investment Management Co., LLC ("CT Investment" for purposes of
this Agreement, CT Investment shall be deemed a subsidiary of the Company),
pursuant to that certain Fund II Investment Management Agreement (as amended,
"Fund II Management Agreement") dated March 8, 2000, by and among CT Investment,
Fund II and CT XX XX, LLC, the general partner of Fund II (the "General
Partner").
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(iii) Fund III is solely managed by CT Investment pursuant to that
certain Management Agreement dated June 2, 2003 (as amended, "Fund III
Management Agreement" and together with the Fund II Management Agreement, the
"Management Agreements"), by and between CT Investment and Fund III.
(iv) None of the Funds, the General Partner or CT Investment is in
breach of, or default under (nor has any event occurred which with notice, lapse
of time, or both would constitute a breach of, or default under, by such party),
the Management Agreements, except for any breach or default that would not have
a material adverse effect on the Company and its subsidiaries, taken as a
whole); the Management Agreements are in full force and effect, have not been
amended, and constitute a legal, valid and binding agreement of the parties
thereto enforceable in accordance with their terms, except as may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
similar laws affecting creditors' rights generally and by general principles of
equity.
(v) Each Fund and the General Partner has been duly incorporated or
formed and is validly existing in good standing under the laws of the
jurisdiction of its formation, has the power and authority to own its property
and to conduct its business as described in the Prospectus and is duly qualified
to transact business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole; the capital stock and other equity interests of
the Funds and the General Partner have been duly and validly authorized and
issued and free and clear of all liens, encumbrances, equities or claims.
(vi) The Company owns all of the equity interests in Capital Trust
RE CDO 2004-1 Ltd. ("CDO Sub"; for all purposes of this Agreement, CDO Sub shall
be deemed a subsidiary of the Company).
(vii) Neither CDO Sub nor CT Investment is in breach of, or default
under (nor has any event occurred which with notice, lapse of time, or both
would constitute a breach of, or default under, by such party), the CDO
Management Agreement, except for any breach or default that would not have a
material adverse effect on the Company and its subsidiaries, taken as a whole;
the CDO Management Agreement is in full force and effect, has not been amended,
and constitutes a legal, valid and binding agreement of the parties thereto
enforceable in accordance with its terms, except as may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
similar laws affecting creditors' rights generally and by general principles of
equity.
(viii) The Company does not own or control, directly or indirectly,
any corporation, limited partnership, limited liability company, trust,
association, or other entity other than (i) CDO Sub, CT RE CDO 2004-1 Sub, LLC
and Capital Trust RE CDO 2004-1 Corp. and (ii) the subsidiaries listed in
Exhibit 21.1 to the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 2003.
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(f) The authorized, issued, and outstanding capital stock of the
Company is as set forth in the Prospectus under the caption "Capitalization"
(other than for subsequent issuances (including restricted stock grants), if
any, pursuant to employee benefit plans described in the Prospectus or upon the
exercise of outstanding options or warrants described in the Prospectus). The
Class A Common Stock (including the Shares) conforms in all material respects to
the description thereof contained, or incorporated by reference, in the
Prospectus. All of the issued and outstanding shares of Class A Common Stock
have been duly authorized and validly issued, are fully paid and non-assessable
and have been issued in compliance with federal and state securities laws. The
Shares to be sold by the Selling Stockholders have been duly authorized and,
when issued upon conversion of the Variable Step Up Trust Preferred Securities
in accordance with the terms thereof, will be validly issued, fully paid and
non-assessable and will have been issued in compliance with federal and state
securities laws. None of the outstanding securities of the Company were issued
in violation of the percentage limitations contained in the Company's
organizational documents, including, without limitation, the provisions of
Article II, Section 10 of the Company's Bylaws and Section 7 of the Company's
Charter. None of the outstanding shares of Class A Common Stock were issued in
violation of any preemptive rights, rights of first refusal, or other similar
rights to subscribe for or purchase securities of the Company. There are no
authorized or outstanding options, warrants, preemptive rights, rights of first
refusal, or other rights to purchase, or equity or debt securities convertible
into, exchangeable or exercisable for, any capital stock of the Company or any
of its subsidiaries other than those accurately described in the Prospectus. The
description of the Company's stock option, stock bonus, and other stock plans or
arrangements, and the options or other rights granted thereunder, set forth in
the Prospectus accurately and fairly presents the information required to be
shown with respect to such plans, arrangements, options, and rights.
(g) This Agreement has been duly authorized, executed and delivered by
the Company.
(h) The Shares to be sold by the Company have been duly authorized and,
when issued and delivered in accordance with the terms of this Agreement, will
be validly issued, fully paid and non assessable, and the issuance of such
Shares will not be subject to any preemptive or similar rights.
(i) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement will not contravene (i)
any provision of applicable law or (ii) the certificate of incorporation or by
laws of the Company or (iii) any agreement or other instrument binding upon (a)
the Company or any of its subsidiaries that is material to the Company and its
subsidiaries, taken as a whole, or (b) either of the Funds, or (iv) any
judgment, order or decree of any governmental body, agency or court having
jurisdiction over the Company or any subsidiary, or either of the Funds, except
in the case of the clauses (i), (iii) or (iv) for such contraventions as would
not have a material adverse effect on the Company and its subsidiaries, taken as
a whole, and no consent, approval, authorization or order of, or qualification
with, any governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, except such as may be required
by the securities or Blue Sky laws of the various states or the NASD in
connection with the offer and sale of the Shares.
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(j) 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 operations of (i) the
Company and its subsidiaries, taken as a whole, or (ii) either of the Funds,
from that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement) (any such change,
a "Material Adverse Change").
(k) There are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened, to which the Company, any of its
subsidiaries or either of the Funds is a party or to which any of the properties
of the Company, any of its subsidiaries or either of the Funds is subject that
are required to be described in the Registration Statements or the Prospectus
and are not so described or any statutes, regulations, contracts or other
documents that are required to be described in the Registration Statements or
the Prospectus or to be filed as exhibits to the Registration Statements that
are not described or filed as required.
(l) Each preliminary prospectus filed as part of the Registration
Statements as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Securities Act, complied when so filed in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder.
(m) The Company is not, and after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as described in
the Prospectus will not be, required to register as an "investment company" as
such term is defined in the Investment Company Act of 1940, as amended.
(n) The Company, its subsidiaries and the Funds (i) are in compliance
with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits, licenses or
other approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (iii) are in compliance with all terms and
conditions of any such permit, license or approval, except in the case of
clauses (i), (ii) or (iii) where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits, licenses or approvals
would not, singly or in the aggregate, have a material adverse effect on the
Company and its subsidiaries, taken as a whole.
(o) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean up, closure of properties or compliance with Environmental
Laws or any permit, license or approval, any related constraints on operating
activities and any potential liabilities to third parties) which would, singly
or in the aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole, or on the Funds.
(p) Except as described in the Prospectus, or as have been waived in
writing and provided to the Underwriters and the Underwriters' counsel, there
are no contracts, agreements or understandings between the Company and any
person granting such person the
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right to require the Company to include such securities with the Shares
registered pursuant to the Registration Statement. All persons who possess such
rights have effectively waived them with respect to the offering of the Shares.
(q) Ernst & Young LLP, who have expressed their opinion with respect to
the financial statements (which term as used in this Agreement includes the
related notes thereto) and supporting schedules filed with the Commission as a
part of (or incorporated by reference in) the Registration Statements and
included or incorporated by reference in the Prospectus, are independent public
or certified public accountants within the meaning of the Securities Act.
(r) None of the Company, any of its subsidiaries or either of the Funds
is in violation or default of (i) any provision of its charter or by-laws or
other organizational documents, as applicable, (ii) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement, loan agreement, credit
facility, repurchase agreement, management agreement, or other agreement,
obligation, condition, covenant or instrument to which it is a party or bound or
to which its property is subject, or (iii) any statute, law, rule, regulation,
judgment, order or decree of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having jurisdiction over the
Company, such subsidiary or Fund or any of its respective properties, as
applicable, including, without limitation, the provisions of the Securities Act,
Exchange Act, Xxxxxxxx-Xxxxx Act and the rules and regulations of the NASD and
the NYSE, except in the case of clauses (ii) or (iii) for such violations or
defaults as would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(s) The Company has delivered to each of the Managers one (1) complete
photocopy of a manually signed copy of the Registration Statements and of each
consent and certificate of experts filed as a part thereof and conformed copies
of the Registration Statements (without exhibits), and preliminary prospectuses,
and the Prospectus, as amended or supplemented, in such quantities and at such
places as the Managers have requested for each of the Underwriters.
(t) The Company has not distributed and will not distribute, prior to
the later of the Option Closing Date (as hereinafter defined) or the expiration
of the right to purchase shares of Class A Common Stock granted to the
Underwriters in Section 3 hereof, any offering material in connection with the
offering and sale of the Shares other than a preliminary prospectus, the
Prospectus, or the Registration Statements.
(u) The financial statements filed with the Commission as a part of (or
incorporated by reference in) the Registration Statements and included or
incorporated by reference in the Prospectus present fairly the consolidated
financial position of the Company and its subsidiaries as of and at the dates
indicated and the results of their operations and cash flows for the periods
specified. The supporting schedules included or incorporated by reference in the
Registration Statements present fairly the information required to be stated
therein. Such financial statements and supporting schedules have been prepared
in conformity with generally accepted accounting principles ("GAAP") applied on
a consistent basis (except in the case of unaudited financials for normal
year-end adjustments) throughout the periods involved, except as may be
expressly stated in the related notes thereto. No other financial statements or
supporting schedules are required to be included or incorporated by reference in
the Registration Statements.
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The financial data set forth in the Prospectus under the captions "Prospectus
Summary--Summary Financial Data," and "Capitalization" fairly present the
information set forth therein and have been compiled on a basis consistent with
that of the audited financial statements contained or incorporated by reference
in the Registration Statements.
(v) The Class A Common Stock (including the Shares) is registered
pursuant to Section 12(b) of the Exchange Act, and has been approved for listing
on the NYSE, subject to official notice of issuance, and the Company has taken
no action designed to, or likely to have the effect of, terminating the
registration of the Class A Common Stock under the Exchange Act or delisting the
Class A Common Stock from the NYSE nor has the Company received any notification
that the Commission or the NYSE is contemplating terminating such registration
or listing.
(w) The Company, its subsidiaries and the Funds own, possess or have a
right to acquire on commercially reasonable terms sufficient trademarks, trade
names, patent rights, patents, know-how, collaborative research agreements,
inventions, servicemarks, copyrights, licenses, approvals, trade secrets, and
other similar rights (collectively, "Intellectual Property Rights") necessary to
conduct their businesses as now conducted, as described in the Registration
Statements, the Prospectus, and any respective amendments or supplements
thereto. The expiration of any of such Intellectual Property Rights would not
have a material adverse effect on the Company and its subsidiaries, taken as a
whole. None of the Company, any of its subsidiaries or either of the Funds has
received any notice of any infringement of or conflict with asserted rights of
the Company by others with respect to any Intellectual Property Rights necessary
to conduct business as now conducted, except as would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole. The
Company, its subsidiaries and the Funds do not, in the conduct of their business
as now conducted, infringe or conflict with any right or patent of any third
party, or any discovery, invention, product, or process which is the subject of
a patent application filed by any third party, known to the Company, any of its
subsidiaries or either of the Funds, which such infringement or conflict is
reasonably likely to have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(x) The Company, each subsidiary and each Fund possesses such valid and
current certificates, authorizations, permits or licenses issued by the
appropriate state, federal, or foreign regulatory agencies or bodies necessary
to conduct their respective businesses as now conducted, and none of the
Company, any subsidiary or any Fund has received any notice of proceedings
relating to the revocation or modification of, or non-compliance with, any such
certificate, authorization or permit, except in each case such as would not have
a material adverse effect on the Company and its subsidiaries, taken as a whole.
(y) The Company and each of its subsidiaries has good and marketable
title to all the real properties reflected as owned in the financial statements
referred to in Section 1(u) above (or elsewhere in the Prospectus), in each case
free and clear of any security interests, mortgages, liens, encumbrances,
equities, claims, and other defects, with such exceptions as are described in
the Prospectus or are not material and do not materially interfere with the use
made or proposed to be made of such property or assets by the Company or such
subsidiary or Fund. The real property, improvements, equipment, and personal
property held under lease by the Company, any subsidiary or any Fund are held
under valid and enforceable leases, with such
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exceptions as are described in the Prospectus or are not material and do not
materially interfere with the use made or proposed to be made of such real
property, improvements, equipment, or personal property by the Company or such
subsidiary or Fund. Each of the mortgages, deeds of trust or other security
agreements executed and/or delivered by or to the Company or either of the
Funds, as applicable, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time, are enforceable in
accordance with its terms, subject to principles of equity and bankruptcy,
insolvency, moratorium and other laws generally applicable to creditors' rights
and the enforcement of debtors' obligations. There are no facts that would
impair the validity or value of any of such mortgages, deeds of trust or other
security agreements and such mortgages, deeds of trust or other security
agreements are not the subject of any breach, default or event, that with the
passage of time or the giving of notice or both, would result in such a breach
or default except as described in the Prospectus or for such facts, breaches,
defaults or events as would not have a material adverse effect on the Company
and its subsidiaries, taken as a whole.
(z) The Company, its subsidiaries and the Funds have filed all
necessary federal, state and foreign income and franchise tax returns and have
paid all taxes required to be paid by any of them and, if due and payable, any
related or similar assessment, fine, or penalty levied against any of them. The
Company has made adequate charges, accruals, and reserves in the applicable
financial statements referred to in Section 1(u) above in respect of all
federal, state, and foreign income and franchise taxes for all periods as to
which the tax liability of the Company or any of its subsidiaries has not been
finally determined. The Company is not aware of any tax deficiency that has been
or might be asserted or threatened against the Company
(aa) There are no transfer taxes or other similar fees or charges under
Federal law or the laws of any state, or any political subdivision thereof,
required to be paid in connection with the execution and delivery of this
Agreement or the issuance and sale by the Company of the Shares.
(bb) Each of the Company, its subsidiaries and the Funds are insured in
such amounts and with such deductibles and covering such risks as are generally
deemed adequate and customary for their businesses including, but not limited
to, policies covering real and personal property owned or leased by the Company
and its subsidiaries against theft, damage, destruction, acts of vandalism,
general liability and Directors' and Officers' liability. Neither the Company,
any of its subsidiaries nor any Fund has received notice that it will not be
able to or has reason to believe that it will not be able to (i) renew their
existing insurance coverage as and when such policies expire, or (ii) obtain
comparable coverage from similar institutions as may be necessary or appropriate
to conduct their business as now conducted and at a cost that would not have a
material adverse effect on the Company and its subsidiaries, taken as a whole.
(cc) The Company has not taken and will not take, directly or
indirectly, any action which was designed to, or that might be expected to cause
or result in, stabilization or manipulation of the price of the Class A Common
Stock in contravention of applicable law.
(dd) There are no business relationships or related-party transactions
involving the Company, any subsidiary, any Fund or any other person required to
be described in the Prospectus which have not been described as required.
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(ee) The documents incorporated or deemed to be incorporated by
reference in the Prospectus, 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 Exchange Act and, when read together with the other
information in the Prospectus, at the time the Registration Statements and any
amendments thereto became effective, at the Closing Date, and at the Option
Closing Date, as the case may be, will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
(ff) The Company and each of its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences; the chief executive officer and principal financial
officer of the Company have made all certifications required by the
Xxxxxxxx-Xxxxx Act and any related rules and regulations promulgated by the
Commission thereunder; the Company maintains "disclosure controls and
procedures" (as defined in Rule 13a-14(c) under the Exchange Act); and the
Company is otherwise in compliance with all applicable provisions of the
Xxxxxxxx-Xxxxx Act and the rules and regulations issued thereunder by the
Commission currently in effect and requiring compliance as of the date hereof,
the Closing Date and the Option Closing Date.
(gg) The Company has obtained Directors' and Officers' liability
insurance in the minimum amount of $10,000,000.
(hh) None of the Company, any of its subsidiaries or either of the
Funds, nor, to the best knowledge of the Company, any employee or agent of the
Company or any subsidiary or any Fund, has made any contribution or other
payment to any official of, or candidate for, any federal, state, or foreign
office in violation of any law or of the character required to be disclosed in
the Prospectus.
(ii) There is no transaction, arrangement or other relationship among
the Company, any of its subsidiaries and/or any unconsolidated or other
off-balance sheet entity that is required to be disclosed by the Company in its
Commission filings and is not so disclosed.
(jj) The statistical and market-related data included in the
Registration Statements and the Prospectus are based on or derived from sources
which the Company reasonably and in good faith believes are reliable and
accurate, and such data agree with the sources from which they are derived.
(kk) The Company, its subsidiaries and the Funds are as of the date
hereof and will be as of the Closing Date and the Option Closing Date, in
compliance with their respective investment, underwriting and risk-adjusted
capital guidelines, policies and procedures, except
10
where any noncompliance would not result in a material adverse effect for the
Company or its subsidiaries, taken as a whole.
(ll) The Company is organized and, beginning with its 2003 taxable year
has operated and thereafter will operate, in a manner so as to qualify as a real
estate investment trust ("REIT") under Sections 856 through 860 of the Internal
Revenue Code of 1986, as amended, and the rules and regulations promulgated
thereunder (collectively, the "Code"), and will elect to, and intends to remain
qualified to, be taxed as a REIT under the Code and pursuant to any applicable
state tax laws. The Company does not know of any event which would cause or is
likely to cause the Company to fail to qualify as a REIT for its 2003 and 2004
taxable years.
(mm) Except for the CDO Sub, neither the Company, any of its
subsidiaries nor any of their assets will be treated as a taxable mortgage pool.
(nn) The entities listed on Schedule V hereto are wholly-owned
subsidiaries of the Company and are "qualified REIT subsidiaries" within the
meaning of Section 856(i) of the Code. The Company has no other "qualified REIT
subsidiaries."
(oo) CT Investment, VIC, Inc., VCG Montreal Management, Inc. and
CT-F2-GP, LLC are wholly-owned subsidiaries of the Company and are "taxable REIT
subsidiaries" within the meaning of Section 856(l) of the Code. Other than
Global Realty Outsourcing, Inc., the Company has no other "taxable REIT
subsidiaries."
(pp) Neither the Company nor any of its subsidiaries has been asked to
replace or substitute any collateralized debt obligations or to indemnify any
party under any collateralized debt obligations.
(qq) The sale of the Shares as contemplated in this Agreement will not
result in an antidilution or other adjustment of the exercise price or number of
shares issuable upon exercise of any options, warrants or other convertible
securities outstanding on the date hereof, the Closing Date and the Option
Closing Date.
(rr) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as otherwise
disclosed in the Prospectus, (i) the Company and its subsidiaries, taken as a
whole, have not incurred any material liability or obligation, direct or
contingent, nor entered into any material transaction not in the ordinary course
of business; (ii) the Company and its subsidiaries have not purchased any of the
Company's outstanding capital stock, and the Company has not declared, paid or
otherwise made any dividend or distribution of any kind on its capital stock;
and (iii) there has not been any material change in the capital stock or
material increase in long-term debt of the Company and its subsidiaries, taken
as a whole, except in each case as reflected in the Prospectus. Except as
disclosed in the Prospectus, as of the date hereof, none of the Company's loans
are in default and the Company has not received notice from any borrower under
any of its loans that a default is imminent and all of the Company's investments
are making payments in accordance with their contractual terms.
(ss) The sale and issuance by the Company of all shares and warrants
pursuant to the Berkley Agreement in the May 11, 2004 and June 18, 2004 closings
of the transactions
11
contemplated therein was in compliance with all applicable state and federal
securities laws, and all applicable rules of the NYSE. The securities issued
pursuant to the Berkley Agreement were duly authorized and, when issued, were
duly and validly issued, fully paid and nonassessable, free and clear of all
liens.
(tt) As of January 1, 2003, the Company has no accumulated earnings or
profits from any tax years in which it was taxed as a regular corporation.
Any certificate signed by an officer of the Company and delivered to the
Managers, or any of them, or to counsel for the Underwriters shall be deemed to
be a representation and warranty by the Company to each Underwriter as to the
matters set forth therein.
2. Representations and Warranties of the Selling Stockholders. Each of the
Selling Stockholders severally and not jointly represents and warrants and
agrees with each of the Underwriters solely as to itself that:
(a) This Agreement has been duly authorized, executed and delivered by
or on behalf of such Selling Stockholder.
(b) The execution and delivery by such Selling Stockholder of, and the
performance by such Selling Stockholder of its obligations under, this
Agreement, the Custody Agreement signed by such Selling Stockholder and American
Stock Transfer and Trust Co., as Custodian, relating to the deposit of the
Shares to be sold by such Selling Stockholder (the "Custody Agreement") and the
Power of Attorney appointing certain individuals as such Selling Stockholder's
attorneys-in-fact to the extent set forth therein, relating to the transactions
contemplated hereby and by the Registration Statements (the "Power of Attorney")
will not contravene (i) any provision of applicable law, or (ii) the
organizational documents of such Selling Stockholder (if such Selling
Stockholder is other than a natural person), or (iii) any agreement or other
instrument binding upon such Selling Stockholder or any judgment, order or
decree of any governmental body, agency or court having jurisdiction over such
Selling Stockholder, except in the case of clauses (i) or (iii) for such
contraventions as would not have a material adverse effect on the transactions
contemplated by this Agreement and no consent, approval, authorization or order
of, or qualification with, any governmental body or agency is required for the
performance by such Selling Stockholder of its obligations under this Agreement
or the Custody Agreement or Power of Attorney of such Selling Stockholder,
except such as may be required by the securities or Blue Sky laws of the various
states in connection with the offer and sale of the Shares.
(c) Such Selling Stockholder has, and on the Closing Date will have
good and marketable title to the Shares to be sold by such Selling Stockholder
free and clear of all security interests, claims, liens, equities or other
encumbrances known to or arising through the Selling Stockholder (except for
encumbrances arising under this Agreement, the Custodian Agreement and the Power
of Attorney) and the legal right and power, and all authorization and approval
required by law, to enter into this Agreement, the Custody Agreement and the
Power of Attorney and to sell, transfer and deliver the Shares to be sold by
such Selling Stockholder or a security entitlement in respect of such Shares.
12
(d) The Custody Agreement and the Power of Attorney have been duly
authorized, executed and delivered by such Selling Stockholder and are valid and
binding agreements of such Selling Stockholder enforceable against the Selling
Stockholder in accordance with their terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, receivership, moratorium or
other laws affecting creditors' rights (including, without limitation, the
effect of statutory and other law regarding fraudulent conveyances, fraudulent
transfers and preferential transfers) and as may be limited by exercise of
judicial discretion and the application of principles of equity, good faith,
fair dealing reasonableness, conscionability and materiality.
(e) Upon delivery to the Underwriters of certificates representing the
Shares to be sold by such Selling Stockholder, each endorsed to the Underwriters
or in blank, by an effective endorsement and payable therefore by the
Underwriters pursuant to this Agreement, the Underwriters will, assuming the
Underwriters do not have notice of any adverse claims thereof, acquire the
Shares to be sold by the Selling Stockholder free and clear of adverse claims,
as defined in Section 8-102 of the New York Uniform Commercial Code.
(f) The information provided by such Selling Stockholder for use in the
Selling Stockholder Registration Statement, Prospectus, and the preliminary
prospectus (consisting of the Selling Stockholder's name, number of Shares to be
sold and the related footnotes to the table under the caption "Selling
Shareholders" insofar as such information relates to such Selling Stockholder)
was and is true and correct.
3. Agreements to Sell and Purchase. Each Seller, severally and not
jointly, hereby agrees to sell to the several Underwriters, and each
Underwriter, upon the basis of the representations and warranties herein
contained, but subject to the conditions hereinafter stated, agrees, severally
and not jointly, to purchase from such Seller at $22.526875 a share (the
"Purchase Price") the number of Firm Shares (subject to such adjustments to
eliminate fractional shares as you may determine) that bears the same proportion
to the number of Firm Shares to be sold by such Seller as the number of Firm
Shares set forth in Schedule I attached hereto opposite the name of such
Underwriter bears to the total number of Firm Shares.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Underwriters the Additional Shares, and the Underwriters shall have the
right to purchase, severally and not jointly, up to 525,000 Additional Shares at
the Purchase Price. You may exercise this right on behalf of the Underwriters in
whole or from time to time in part by giving written notice of each election to
exercise the option not later than 30 days after the date of this Agreement. Any
exercise notice shall specify the number of Additional Shares to be purchased by
the Underwriters and the date on which such shares are to be purchased. Each
purchase date must be at least two business days after the written notice is
given and may not be earlier than the closing date for the Firm Shares or later
than ten business days after the date of such notice. Additional Shares may be
purchased as provided in Section 5 hereof solely for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares. On each
day, if any, that Additional Shares are to be purchased (an "Option Closing
Date"), each Underwriter agrees, severally and not jointly, to purchase the
number of Additional Shares (subject to such adjustments to eliminate fractional
shares as you may determine) that bears the same proportion to the total number
of Additional
13
Shares to be purchased on such Option Closing Date as the number of Firm Shares
set forth in Schedule I attached hereto opposite the name of such Underwriter
bears to the total number of Firm Shares.
Each Seller 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 90 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
purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any
shares of Class A Common Stock or any securities convertible into or exercisable
or exchangeable for shares of Class A 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 shares of Class A Common Stock,
whether any such transaction described in clause (i) or (ii) above is to be
settled by delivery of shares of Class A Common Stock or such other securities,
in cash or otherwise.
The restrictions contained in the preceding paragraph shall not apply to
(A) the Shares to be sold hereunder, or (B) the issuance by the Company of
shares of Class A Common Stock upon the exercise, conversion or exchange of
options, warrants or other convertible or exchangeable securities outstanding on
the date hereof or (C) the grant of options or warrants pursuant to the terms of
a plan in effect on the date hereof, provided that any option or warrant so
issued shall not be exercised during the period ending 90 days after the date of
the Prospectus or (D) the grant of restricted stock pursuant to the terms of a
plan or agreement in effect on the date hereof, provided that any such stock so
issued shall not vest during the period ending 90 days after the date of the
Prospectus or the recipient of such stock agrees not to transfer such stock
during such period. In addition, each Selling Stockholder, agrees that, without
the prior written consent of Xxxxxx Xxxxxxx & Co. Incorporated on behalf of the
Underwriters, it will not, during the period ending 90 days after the date of
the Prospectus, make any demand for, or exercise any right with respect to, the
registration of any shares of Class A Common Stock or any security convertible
into or exercisable or exchangeable for Class A Common Stock.
4. Terms of Public Offering. The Sellers are advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after this Agreement has been executed as in your judgment is
advisable. The Sellers are further advised by you that the Shares are to be
offered to the public initially at $23.75 a share (the "Public Offering Price")
and to certain dealers selected by you at a price that represents a concession
not in excess of $0.80 a share under the Public Offering Price.
5. Payment and Delivery. Payment for the Firm Shares to be sold by each
Seller shall be made to such Seller by wire transfer in Federal or other funds
immediately available in New York City against delivery of such Firm Shares for
the respective accounts of the several Underwriters at 10:00 a.m., New York City
time, on July 28, 2004, or at such other time on the same or such other date,
not later than August 7, 2004, as shall be designated in writing by you. The
time and date of such payment are hereinafter referred to as the "Closing Date."
Payment for any Additional Shares shall be made to the Company by wire
transfer in Federal or other funds immediately available in New York City
against delivery of such Additional Shares for the respective accounts of the
several Underwriters at 10:00 a.m., New
14
York City time, on the date specified in the corresponding notice described in
Section 3 or at such other time on the same or on such other date, in any event
not later than August 27, 2004, as shall be designated in writing by you.
The Firm Shares and Additional Shares shall be registered in such names
and in such denominations as you shall request in writing not later than one
full business day prior to the Closing Date or the applicable Option Closing
Date, as the case may be. The Firm Shares and Additional Shares shall be
delivered to you on the Closing Date or an Option Closing Date, as the case may
be, for the respective accounts of the several Underwriters, against payment of
the Purchase Price therefor. The Company will pay in a timely manner transfer
taxes payable in connection with the transfer of the Shares to be sold by the
Company, and the Selling Stockholders will pay in a timely manner transfer taxes
payable in connection with the transfer of the Shares to be sold by the Selling
Stockholders.
6. Conditions to the Underwriters' Obligations. The several obligations of
the Sellers to sell the Shares to the Underwriters and the several obligations
of the Underwriters to purchase and pay for the Shares on the Closing Date and
any Option Closing Date are subject to the condition that the Registration
Statements shall remain effective on the date hereof and no stop order with
respect to the effectiveness of the Registration Statement shall have been
issued under the Securities Act nor any proceedings initiated under Sections
8(d) and 8(e) of the Securities Act.
The several obligations of the Underwriters are subject to the following
further conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date and any Option Closing Date, as the case may be:
(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
(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 Shares on the terms and in the manner contemplated
in the Prospectus.
(b) The Underwriters shall have received on the Closing Date and any
Option Closing Date, as the case may be, a certificate, dated such date, and
signed by an executive officer of the Company, to the effect set forth in
Section 6(a)(i) above and to the effect that the representations and warranties
of the Company contained in this Agreement are true, correct and complete as of
the Closing Date and that the Company has complied with all of the agreements
15
and satisfied all of the conditions on its part to be performed or satisfied
hereunder on or before the Closing Date.
The officer signing and delivering such certificate may rely upon the
best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an opinion
of Xxxxxxx LLP, Maryland counsel for the Company, dated the Closing Date, to the
effect that:
(i) the Company has been duly incorporated and is validly existing
under the laws of the State of Maryland and is in good standing with the
Maryland State Department of Assessment and Taxation, the Company has the
corporate power and authority to own its property and to conduct its business as
described in the Prospectus under the caption "Business" and to enter into and
perform its obligations under the Agreement;
(ii) the authorized, issued and outstanding stock of the Company as
of June 30, 2004 was as set forth in the Prospectus Supplement under the caption
"Historical and Pro Forma Capitalization" and the shares of the Company's
capital stock issued and outstanding prior to the issuance of the Shares (the
"Outstanding Shares") have been duly authorized and validly issued and are fully
paid and non-assessable and none of the Outstanding Shares was issued in
violation of preemptive rights arising under the Maryland General Corporation
Law (the "MGCL") or the Company's charter or bylaws;
(iii) the Shares to be sold by the Company have been duly
authorized by all necessary corporate action on the part of the Company for
issuance and sale to the Underwriters pursuant to this Agreement and, when
issued and delivered by the Company pursuant to this Agreement against payment
of the consideration set forth therein, will be validly issued, fully paid and
non-assessable;
(iv) the shares of Class A Common Stock issuable upon conversion of
the shares of Variable Step Up Trust Preferred Securities of CT Convertible
Trust I have been duly authorized and are validly issued, fully paid and
non-assessable;
(v) the issuance of the Shares is not subject to preemptive rights
arising under the MGCL or the Company's charter or bylaws;
(vi) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement do not
conflict with or violate the Charter, the Bylaws or the MGCL; the execution,
delivery and performance of this Agreement by the Company have been duly
authorized by all necessary corporate action on the part of the Company; this
Agreement has been duly executed and delivered by the Company;
(vii) the authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus;
(viii) we have reviewed the information in the Prospectus under the
captions "Risk Factors - Risks Relating to this Offering - Some provisions of
our charter and bylaws and Maryland law may deter takeover attempts, which may
limit the opportunity of our
16
shareholders to sell their shares at a favorable price" and in the Prospectus
under the captions "Description of Capital Stock" and "Description of Our Stock"
and, to the extent such information constitutes a summary of the terms of the
Shares, summaries of Maryland legal matters, summaries of certain provisions of
the Company's charter or bylaws or legal conclusions with respect to matters of
Maryland law, such information is correct in all material respects and the
Shares conform in all material respects to such descriptions; and
(ix) Fund III has been duly incorporated and is validly existing
under the laws of the State of Maryland and is in good standing with the
Maryland State Department of Assessment and Taxation. Fund III has the corporate
power to own its property and to conduct its business as described in the
Prospectus under the caption "Business."
The opinions of Xxxxxxx LLP described in Section 6(c) above shall
be rendered to the Underwriters at the request of the Company, and shall so
state therein.
(d) the Underwriters shall have received on the Closing Date an opinion
of Paul, Hastings, Xxxxxxxx & Xxxxxx LLP, outside counsel to the Company, dated
the Closing Date, to the effect that:
(i) CT Investment is validly existing as a limited liability
company in good standing under the laws of the State of Delaware. CT Investment
has the limited liability company power and authority to own, lease and operate
its properties and to conduct its business as described in the Registration
Statements and the Prospectus, except where the failure to have such power or
authority would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole;
(ii) all the outstanding membership interests of CT Investment (a)
have been duly authorized and validly issued, (b) based solely upon a review of
the LLC Agreement, are owned of record, directly or, through another subsidiary
of the Company, indirectly, by the Company and (c) are not, to our knowledge,
subject to any perfected security interest or, to our knowledge, any other
encumbrance or adverse claim;
(iii) the statements in the Prospectus under the caption "Federal
Income Tax Considerations" insofar as they purport to constitute a summary of
matters of law, legal matters or the documents referred to therein, is an
accurate summary in all material respects;
(iv) based upon the reasoning and analysis set forth in the opinion
letter, while the matter is not entirely free from doubt, it is our opinion that
the Company is not and, immediately after giving effect to the offer and sale of
the Shares as contemplated by this Agreement and described in the Prospectus,
will not be an "investment company," as this term is defined in the Investment
Company Act of 1940, as amended;
(v) the Registration Statements, as of their effective dates, and
the Prospectus, as of its date (other than the financial statements, notes and
schedules thereto and the other information of a financial, statistical or
accounting nature included or incorporated by reference therein, as to which we
express no opinion, and the documents incorporated by reference therein, as to
which we express no opinion in this paragraph), appear on their face to comply
as to form in all material respects with the applicable requirements of the
Securities Act.
17
The Company has satisfied the conditions for the use of Form S-3, as set forth
in the general instructions thereto, with respect to the Registration
Statements;
(vi) the documents incorporated by reference into the Registration
Statements, on the respective dates they were filed (other than the financial
statements, notes and schedules thereto and the other information of a
financial, statistical or accounting nature included or incorporated by
reference therein, as to which we express no opinion), appear on their face to
comply as to form in all material respects with the applicable requirements of
Form 10-K, Form 10-Q and form 8-K (to the extent incorporated by reference into
the Registration Statements), as the case may be, under the Exchange Act;
(vii) to our knowledge, based solely on confirmation by the SEC,
the Registration Statements have been declared effective by the Commission under
the Securities Act; to our knowledge, based solely on the confirmation by the
SEC, we are not aware of any stop order suspending the effectiveness of the
Registration Statements, and, to our knowledge, no stop order proceedings for
such purpose are pending by the Commission. Any required filing of the
Prospectus pursuant to Rule 424 under the Securities Act has been made in the
manner and within the time period required by such Rule 424;
(viii) no consent, approval, authorization or order of or filing
with any federal or New York state governmental authority or, to our knowledge,
any New York or United States federal court is required for the Company's
execution and delivery of the Underwriting Agreement and the issuance of the
Company Shares pursuant thereto, other than (a) those that have been obtained
under the Securities Act, the Exchange Act or the rules of the NYSE, (b) those
under state securities or blue sky laws (as to which we express no opinion) and
(c) any necessary approval of the Corporate Financing Department of NASD (as to
which we express no opinion);
(ix) the execution and delivery of the Agreement by the Company and
the issuance and delivery of the Company Shares by the Company in accordance
therewith do not (a) constitute a breach by the Company of, or constitute a
default by the Company under, any of the agreements filed as an exhibit to the
Registration Statements, other than such breach or default by the Company as
could not reasonably be expected to have a material adverse effect on the
Company and its subsidiaries, taken as a whole, (b) cause the Company to violate
any federal or New York law, regulation or rule applicable to the Company, or
(c) cause the Company to violate any decree, judgment or order of any federal or
New York state court or governmental authority to which the Company is a named
party and which is known to us;
(x) to our knowledge, there are no contracts, licenses, agreements,
leases or documents of a character which are required to be filed as exhibits to
the Registration Statements or to be summarized or described in the Prospectus
which are not so filed, summarized or described, as applicable;
(xi) to our knowledge, there is no action, suit or proceeding at
law or in equity, or by or before any federal or New York state court or
governmental or regulatory body or agency pending or overtly threatened against
the Company or CT Investment, which is required to be described in the
Prospectus which is not so described;
18
(xii) to our knowledge, based solely on a review of the Company's
NYSE listing applications, the Shares have been approved for listing on the
NYSE, subject to official notice of issuance;
(xiii) the Company has qualified for treatment as a "real estate
investment trust" under the Code since January 1, 2003 through December 31,
2003, the date of the most recent audited financial statements and, based on
management reports of the Company reviewed by us and the Company's organization
and current and contemplated methods of operation, as described in the
Registration Statements and the Prospectus and as represented to us by the
Company, will be able to continue to so qualify; and
(xiv) in connection with the preparation of the Registration
Statements and Prospectus, we have participated in conferences with directors,
officers and other representatives of the Company and its subsidiaries,
representatives of the Selling Stockholders and their counsel, representatives
of Ernst & Young LLP and representatives of the Underwriters and counsel for the
Underwriters at which the contents of the Registration Statements and Prospectus
were discussed and, although we have not independently verified and are not
passing upon and do not assume responsibility, explicitly or implicitly, for the
accuracy, completeness or fairness of the statements contained in the
Registration Statements or Prospectus (except to the extent stated, but only to
the extent stated, in clause (iii) set forth above), on the basis of the
foregoing, relying as to materiality to a large extent on the representations of
officers and other representatives of the Company and its subsidiaries, no fact
has come to our attention which leads us to believe that the Registration
Statements at the time such Registration Statements became effective contained
an untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or that the Prospectus at the date of such Prospectus or at the date
hereof contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading (it being understood that we express no view with respect
to the financial statements, notes and schedules thereto and other information
of a financial, statistical or accounting nature included or incorporated by
reference in the Registration Statements or Prospectus).
With respect to Section 6(d)(xiv) above, Paul, Hastings, Xxxxxxxx &
Xxxxxx LLP, may state that their beliefs are based upon their participation in
the preparation of the Registration Statements and Prospectus and any amendments
or supplements thereto and documents incorporated by reference and review and
discussion of the contents, thereof, and review and discussion of the contents
thereof, but are without independent check or verification, except as specified.
The opinions of Paul, Hastings, Xxxxxxxx & Xxxxxx LLP described in
Section 6(d) above shall be rendered to the Underwriters at the request of the
Company, and shall so state therein.
(e) The Underwriters shall have received on the Closing Date an opinion
of Xxxxx & Xxxxxxx L.L.P., counsel for Selling Stockholder EOP Operating Limited
Partnership ("EOP"), dated the Closing Date, to the effect that:
19
(i) this Agreement has been duly authorized, executed and delivered
by or on behalf of EOP;
(ii) the execution and delivery by EOP of, and the performance as
of the Closing Date by EOP of its obligations under, this Agreement and the
Custody Agreement and the Power of Attorney of EOP do not (a) violate the
Delaware Revised Uniform Limited Partnership Act, as amended, or the Third
Amended and Restated Agreement of Limited Partnership of EOP dated July 2, 2001,
as amended or (b) breach or constitute a default under any agreement or contract
filed as an exhibit to the Annual Report on Form 10-K for the year ended
December 31, 2003 of EOP;
(iii) the Custody Agreement and the Power of Attorney of EOP have
been duly authorized, executed and delivered by EOP and constitute valid and
binding obligations of EOP enforceable against EOP in accordance with their
terms, except as enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, receivership, moratorium or other laws affecting creditors'
rights (including, without limitation, the effect of statutory and other law
regarding fraudulent conveyances, fraudulent transfers and preferential
transfers) and as may be limited by exercise of judicial discretion and the
application of principles of equity, good faith, fair dealing reasonableness,
conscionability and materiality (regardless of whether the enforceability
thereof is considered in a proceeding at law or in equity); and
(iv) upon delivery to the Underwriters of certificates representing
the Shares to be sold by EOP, each indorsed to the Underwriters or in blank, by
an effective indorsement, and payment therefore by the Underwriters pursuant to
the Agreement, the Underwriters will, assuming that the Underwriters do not have
notice of any adverse claims thereto, acquire the Shares to be sold by EOP free
and clear of adverse claims, as defined in Section 8-102 of the New York Uniform
Commercial Code.
The opinion of Xxxxx & Xxxxxxx L.L.P. described in Section 6 (e)
above shall be rendered to the Underwriters at the request of the EOP, and shall
so state therein.
(f) The Underwriters shall have received on the Closing Date an opinion
of inside counsel to GMAM Investment Funds Trust and GMAM Group Pension Trust II
(the "GM Stockholders"), dated the Closing Date, to the effect that:
(i) this Agreement has been duly authorized, executed and delivered
by or on behalf of each of the GM Stockholders;
(ii) the execution and delivery by the GM Stockholders of, and the
performance by the GM Stockholders of their obligations under, this Agreement
and the Custody Agreement and Powers of Attorney of the GM Stockholders shall
not contravene any provision of the organizational documents of the GM
Stockholders or, to the knowledge of such counsel, applicable law, any agreement
or other instrument binding upon the GM Stockholders or any judgment, order or
decree of any governmental body, agency or court having jurisdiction over the GM
Stockholders; and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for the
performance by the GM Stockholders of
20
their obligations under this Agreement or the Custody Agreement or Power of
Attorney of the GM Stockholders, except as may be required by the securities or
Blue Sky laws of the various states in connection with the offer and sale of the
Shares;
(iii) the GM Stockholders have valid title to, or a valid security
entitlement in respect of, the Shares to be sold by the GM Stockholders free and
clear of all security interests, claims, liens, equities and other encumbrances,
and the GM Stockholders have the legal right and power, and all authorization
and approval required by law, to enter into this Agreement and the Custody
Agreement and Power of Attorney of the GM Stockholders and to sell, transfer and
deliver the Shares to be sold by the GM Stockholders or a security entitlement
in respect of such Shares; and
(iv) the Custody Agreement and the Power of Attorney of the GM
Stockholders have been duly authorized, executed and delivered by the GM
Stockholders and are valid and enforceable binding agreements of the GM
Stockholders.
The opinions of inside counsel to the GM Stockholders in Sections
6(f) above shall be rendered to the Underwriters at the request of the GM
Stockholders, and shall so state therein.
(g) The Underwriters shall have received on the Closing Date and any
Option Closing Date, as the case may be, an opinion of O'Melveny & Xxxxx LLP,
counsel for the Underwriters, dated such date, in form and substance
satisfactory to the Underwriters.
(h) The Underwriters shall have received, on each of the date hereof
and the Closing Date, a letter dated the date hereof or the Closing Date, as the
case may be, in form and substance reasonably satisfactory to the Underwriters,
from Ernst & Young LLP, independent public accountants, containing statements
and information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and certain
financial information contained in or incorporated by reference into the
Registration Statements and the Prospectus; provided that (i) the letter
delivered on the Closing Date shall use a "cut-off date" not earlier than the
date hereof and (ii) the letter delivered shall not be deemed satisfactory if it
does not include the paragraphs set forth on Schedule IV. On or before the
Closing Date and each Option Closing Date, the Company shall have delivered to
Ernst & Young, LLP the necessary financial statements necessary for Ernst &
Young, LLP to include in its comfort letter the additional paragraphs set forth
on Schedule IV hereto.
(i) The Lock-up Agreements between you and the parties set forth on
Schedule III relating to sales and certain other dispositions of shares of Class
A Common Stock or certain other securities, delivered to you on or before the
date hereof or, as indicated on Schedule III hereto, the Closing Date, shall be
in full force and effect on the Closing Date.
(j) At least three (3) business days prior to the Closing Date, the
Company and the Selling Stockholders shall have furnished for review by the
Managers copies of the Powers of Attorney and Custody Agreements executed by
each of the Selling Stockholders and such further information, certificates, and
documents as the Managers may reasonably request.
21
(k) On the Closing Date, the Managers shall have received a written
certificate executed by the Attorney-in-Fact for each of the Selling
Stockholders, dated as of such Closing Date, to the effect that:
(i) the representations, warranties, and covenants of such Selling
Stockholder set forth in Section 2 are true, correct and complete with the same
force and effect as though expressly made by such Selling Stockholder on and as
of such Closing Date; and
(ii) such Selling Stockholder has complied with all the agreements
and satisfied all the conditions on its part to be performed or satisfied at or
prior to such Closing Date.
(l) On or before each of the Closing Date and the Option Closing Date,
the Managers and counsel for the Underwriters shall have received such
information, documents and opinions as they may reasonably require for the
purposes of enabling them to pass upon the issuance and sale of the Shares as
contemplated herein, or in order to evidence the accuracy of any of the
representations and warranties, or the satisfaction of any of the conditions or
agreements, herein contained.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the delivery to you on the applicable Option Closing
Date of such documents as you may reasonably request with respect to the good
standing of the Company, the due authorization and issuance of the Additional
Shares to be sold on such Option Closing Date and other matters related to the
issuance of such Additional Shares.
7. Covenants.
A. Covenants of the Company. In further consideration of the agreements of
the Underwriters herein contained, the Company covenants with each Underwriter
as follows:
(a) To furnish to each of the Managers, without charge, one (1)
photocopy of the manually signed Registration Statements (including exhibits
thereto and documents incorporated by reference) and for delivery to each other
Underwriter a conformed copy of the Registration Statements (without exhibits
thereto but including documents incorporated by reference) and to furnish to you
in New York City, without charge, prior to 10:00 a.m. New York City time on the
second business day next succeeding the date of this Agreement and during the
period mentioned in Section 7(c) below, as many copies of the Prospectus, any
documents incorporated by reference, and any supplements and amendments thereto
or to the Registration Statements as you may reasonably request. The terms
"supplement" and "amendment" or "amend" as used in this Agreement shall include
all documents subsequently filed by the Company with the Commission pursuant to
Exchange Act, that are deemed to be incorporated by reference in the Prospectus.
(b) Until the expiration of the right to purchase shares of Class A
Common Stock granted to the Underwriters in Section 3 hereof, before amending or
supplementing the Registration Statements or the Prospectus, to furnish to you a
copy of each such proposed amendment or supplement and not to file any such
proposed amendment or supplement to which
22
you reasonably object, and to file with the Commission within the applicable
period specified in Rule 424(b) under the Securities Act any prospectus required
to be filed pursuant to such Rule.
(c) If, during such period after the first date of the public offering
of the Shares as in the reasonable opinion of counsel for the Underwriters the
Prospectus is required by law to be delivered in connection with sales by an
Underwriter or dealer through expiration of the right to purchase shares of
Class A Common Stock granted to the Underwriters in Section 3 hereof, any event
shall occur or condition exist as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading, or if, in the
reasonable opinion of counsel for the Underwriters, it is necessary to amend or
supplement the Prospectus to comply with applicable law, forthwith to prepare,
file with the Commission and furnish, at its own expense, to the Underwriters
and to the dealers (whose names and addresses you will furnish to the Company)
to which Shares may have been sold by you on behalf of the Underwriters and to
any other dealers upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances under which they were
made, be misleading or so that the Prospectus, as amended or supplemented, will
comply with law.
(d) To endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request, provided; that nothing in this Section 7(A)(d) shall require the
Company to qualify generally to do business in any jurisdiction where it is not
then so qualified, subject the Company to any material tax in any such
jurisdiction where it is not then so subject or require the Company to file a
general consent to service of process in any such jurisdiction.
(e) To make generally available to the Company's security holders and
to you as soon as reasonably practicable an earning statement covering the
twelve-month period ending September 30, 2005 that satisfies the provisions of
Section 11(a) of the Securities Act and the rules and regulations of the
Commission thereunder.
B. Covenants of the Selling Stockholders. Each Selling Stockholder further
covenants and agrees with each Underwriter to deliver to the Managers or the
custodian, as applicable, prior to the Closing Date a properly completed and
executed United States Treasury Department Form W-8 (if the Selling Stockholder
is a non-United States person) or Form W-9 (if the Selling Stockholder is a
United States Person).
Xxxxxx Xxxxxxx & Co. Incorporated, on behalf of the several Underwriters,
may, in its sole discretion, waive in writing the performance by the Company or
any Selling Stockholder of the foregoing covenants or extend the time for its
performance.
8. Expenses. Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, the Company agrees to
pay or cause to be paid all expenses incident to the performance of obligations
of the Company and the Selling Stockholders under this Agreement (except to the
extent the Selling Stockholders are obligated to pay or to cause to be paid an
expense described in the next two sentences), including: (i) the fees,
disbursements and expenses of the Company's counsel and the Company's
accountants in
23
connection with the registration and delivery of the Shares under the Securities
Act and all other fees or expenses in connection with the preparation and filing
of the Registration Statements, any preliminary prospectus, the Prospectus and
amendments and supplements to any of the foregoing, including all printing costs
associated therewith, and 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 Shares to be sold
by the Company 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 Shares under
state securities laws and all expenses in connection with the qualification of
the Shares for offer and sale under state securities laws as provided in Section
7A(d) 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
Shares by the NASD, (v) all fees and expenses in connection with the preparation
and filing of the registration statement on Form 8-A relating to the Class A
Common Stock and all costs and expenses incident to listing the Shares on the
NYSE, (vi) the cost of printing certificates representing the Shares, (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
Shares, 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, (ix) the document production charges and expenses
associated with printing this Agreement and (x) 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. Notwithstanding the
foregoing, the expenses of the offering of the Shares incurred by or on behalf
of the Company will be paid pro rata by the Company and the Selling Stockholders
based on the number of Shares sold in the offering among the Company and the
Selling Stockholders, except for the expenses of the Selling Stockholders in the
next sentence, which shall be paid by the Selling Stockholders; provided,
however, that in no event shall EOP be required to pay such portion of the
Company's expenses to the extent it would result in the net proceeds to EOP to
be less than $22.00 per share after taking into account all of EOP's expenses,
except for the expenses of its legal counsel. Whether or not the transactions
contemplated by this Agreement are consummated or this Agreement is terminated,
each Selling Stockholder agrees to pay or cause to be paid (i) all of the fees,
disbursements and expenses of its counsel and the Custodian and (ii) all costs
and expenses related to the transfer and delivery of the Shares to be sold by
the Selling Stockholders to the Underwriters, including any transfer or other
taxes payable thereon. It is understood, however, that except as provided in
this Section, Section 9 entitled "Indemnity and Contribution", and the last
paragraph of Section 11 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.
The provisions of this Section shall not supersede or otherwise affect any
agreement that the Sellers may otherwise have for the allocation of such
expenses among themselves.
24
9. Indemnity and Contribution.
(a) The Company agrees to indemnify and hold harmless each Underwriter,
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, and each
affiliate of any Underwriter within the meaning of Rule 405 under the Securities
Act, each Selling Stockholder, each person, if any, who controls any Selling
Stockholder within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, and each affiliate of any Selling Stockholder
within the meaning of Rule 405 under the Securities Act, from and against any
and all losses, claims, damages and liabilities (including, without limitation,
any legal or other 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
Statements 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, and 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 Selling Stockholder furnished to the Company in writing by such
Selling Stockholder for use therein; provided, however, that the foregoing
indemnity agreement with respect to any preliminary prospectus shall not inure
to the benefit of any Underwriter from whom the person asserting any such
losses, claims, damages or liabilities purchased Shares, or any person
controlling such Underwriter or affiliate of such Underwriter, if a copy of the
Prospectus (as then amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) was not sent or given by or on behalf of
such Underwriter to such person, if required by law so to have been delivered,
at or prior to the written confirmation of the sale of the Shares to such
person, and if the Prospectus (as so amended or supplemented) would have cured
the defect giving rise to such losses, claims, damages or liabilities, unless
such failure is the result of noncompliance by the Company with Section 7(a)
hereof.
The Selling Stockholders, severally and not jointly, agree to indemnify
and hold harmless each Underwriter, 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, and each affiliate of any Underwriter within the
meaning of Rule 405 under the Securities Act, from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other 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 Selling Stockholder
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, but only with reference
to information relating to such Selling Stockholder furnished by or on behalf of
such Selling Stockholder for use in the Selling Stockholder Registration
Statement, any preliminary prospectus, the Prospectus or any amendments or
25
supplements thereto, provided that the aggregate liability of each Selling
Stockholder pursuant to this Section 9(a) and Sections 9(b), 9(e) and 9(f) below
shall not exceed an amount equal to the aggregate net proceeds to such Selling
Stockholder from the sale of the Firm Shares sold by such Selling Stockholder to
the Underwriters. For all purposes of this Agreement, the information (name,
number of shares and the related footnotes to the table insofar as such
information relates to such Selling Stockholder) contained in the Prospectus
under the caption "Selling Shareholders" is the only information furnished in
writing by a Selling Stockholder for use in the Selling Stockholder Registration
Statement, preliminary prospectus, the Prospectus, or any amendments or
supplements thereto.
(b) Each Selling Stockholder agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers who sign
the Registration Statements 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, from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other 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 Selling Stockholder 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, but only with reference to information relating to such
Selling Stockholder furnished in writing by or on behalf of such Selling
Stockholder expressly for use in the Selling Stockholder Registration Statement,
any preliminary prospectus, the Prospectus or any amendments or supplements
thereto.
(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, the Selling Stockholders, the directors of the
Company, the officers of the Company who sign the Registration Statements and
each person, if any, who controls the Company or any Selling Stockholder 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 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 Statements 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,
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 Statements, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
(d) 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 9(a), 9(b) or 9(c), 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
26
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
reasonable 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 (i) the fees and expenses of more than one separate firm (in
addition to any local counsel) for all Underwriters and all persons, if any, who
control any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act or who are affiliates of any
Underwriter within the meaning of Rule 405 under the Securities Act, (ii) the
fees and expenses of more than one separate firm (in addition to any local
counsel) for the Company, its directors, its officers who sign the Registration
Statements and each person, if any, who controls the Company within the meaning
of either such Section and (iii) the fees and expenses of more than one separate
firm (in addition to any local counsel) for all Selling Stockholders and all
persons, if any, who control any Selling Stockholder within the meaning of
either such Section, and that all such fees and expenses shall be reimbursed as
they are reasonably incurred. In the case of any such separate firm for the
Underwriters and such control persons and affiliates of any Underwriters, such
firm shall be designated in writing by Xxxxxx Xxxxxxx & Co. Incorporated. In the
case of any such separate firm for the Company, and such directors, officers and
control persons of the Company, such firm shall be designated in writing by the
Company. In the case of any such separate firm for the Selling Stockholders and
such control persons of any Selling Stockholders, such firm shall be designated
in writing by the Selling Stockholder holding a majority of the Shares sold or
to be sold hereunder. 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 any time 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 60 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.
(e) To the extent the indemnification provided for in Section 9(a),
9(b) or 9(c) is unavailable to an indemnified party or insufficient in respect
of any losses, claims, damages or
27
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 indemnifying party
or parties on the one hand and the indemnified party or parties on the other
hand from the offering of the Shares or (ii) if the allocation provided by
clause 9(e)(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
9(e)(i) above but also the relative fault of the indemnifying party or parties
on the one hand and of the indemnified party or parties 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 and the Selling
Stockholders on the one hand and the Underwriters on the other hand in
connection with the offering of the Shares shall be deemed to be in the same
respective proportions as the net proceeds from the offering of the Shares
(before deducting expenses) received by each Seller and the total underwriting
discounts and 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 Shares. The relative fault of the Company and the Selling
Stockholders 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, the Selling
Stockholders 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 9 are several in proportion to the respective number of Shares they
have purchased hereunder, and not joint. The obligations of the Selling
Stockholders to contribute pursuant to this Section 9 are several and not joint
and shall be in proportion to the respective number of Shares sold by such
Selling Stockholder under this Agreement.
(f) The Company, the Selling Stockholders and the Underwriters agree
that it would not be just or equitable if contribution pursuant to this Section
9 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 9(e).
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 9, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public 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 9 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.
28
(g) The indemnity and contribution provisions contained in this Section
9 and the representations, warranties and other statements of the Company and
the Selling Stockholders 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, any person
controlling any Underwriter or any affiliate of any Underwriter, any Selling
Stockholder or any person controlling any Selling Stockholder, or the Company,
its officers or directors or any person controlling the Company and (iii)
acceptance of and payment for any of the Shares.
10. Termination. The Underwriters may terminate this Agreement by notice
given by you to the Company, if after the execution and delivery of this
Agreement and prior to the Closing Date (i) trading generally shall have been
suspended or materially limited on, or by, as the case may be, any of the NYSE,
the American Stock Exchange or the Nasdaq National Market, (ii) trading of any
securities of the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a material disruption in securities settlement,
payment or clearance services in the United States shall have occurred, (iv) any
moratorium on commercial banking activities shall have been declared by Federal
or New York State authorities or (v) there shall have occurred any outbreak or
escalation of hostilities, or any change in financial markets or any calamity or
crisis that, in your judgment, is material and adverse and which, singly or
together with any other event specified in this clause (v), makes it, in your
judgment, impracticable or inadvisable to proceed with the offer, sale or
delivery of the Shares on the terms and in the manner contemplated in the
Prospectus.
11. Effectiveness; Defaulting Underwriters. This Agreement shall become
effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or an Option Closing Date, as the case may be, any
one or more of the Underwriters shall fail or refuse to purchase Shares that it
has or they have agreed to purchase hereunder on such date, and the aggregate
number of Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Shares to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions that the number of Firm Shares set forth
opposite their respective names in Schedule II bears to the aggregate number of
Firm Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you may specify, to purchase the
Shares which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on such date; provided that in no event shall the number of
Shares that any Underwriter has agreed to purchase pursuant to this Agreement be
increased pursuant to this Section 11 by an amount in excess of one-ninth of
such number of Shares without the written consent of such Underwriter. If, on
the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Firm Shares and the aggregate number of Firm Shares with respect to
which such default occurs is more than one-tenth of the aggregate number of Firm
Shares to be purchased, and arrangements satisfactory to you, the Company and
the Selling Stockholders for the purchase of such Firm Shares are not made
within 36 hours after such default, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter, the Company or the
Selling Stockholders. In any such case either you or the relevant Sellers shall
have the right to postpone the Closing Date, but in no event for longer than
seven days, in order that the required changes, if any, in the Registration
Statements and in the
29
Prospectus or in any other documents or arrangements may be effected. If, on an
Option Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Additional Shares and the aggregate number of Additional Shares with
respect to which such default occurs is more than one-tenth of the aggregate
number of Additional Shares to be purchased on such Option Closing Date, the
non-defaulting Underwriters shall have the option to (i) terminate their
obligation hereunder to purchase the Additional Shares to be sold on such Option
Closing Date or (ii) purchase not less than the number of Additional Shares that
such non-defaulting Underwriters would have been obligated to purchase in the
absence of such default. Any action taken under this paragraph shall not relieve
any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them,
because of any failure or refusal on the part of any Seller to comply with the
terms or to fulfill any of the conditions of this Agreement, or if for any
reason any Seller shall be unable to perform its obligations under this
Agreement, the Sellers will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
12. Defaulting Selling Stockholders. If any Selling Stockholder shall fail
to sell and deliver the number of Shares which such Selling Stockholder is
obligated to sell hereunder, then the Underwriters shall purchase from the
Company all of the Shares to be sold by the defaulting Selling Stockholders and
the Company shall sell such Shares to the Underwriters. No action taken pursuant
to this Section 11 shall relieve any Selling Stockholder so defaulting from
liability, if any, in respect of such default.
In the event that the Firm Shares to which the default relates are to
be sold, the Underwriters shall have the right to postpone the Closing Date or
Additional Closing Date, as the case may be for a period, not exceeding five
business days, in order to effect whatever changes may thereby be made necessary
in the Registration Statement or the Prospectus or in any other documents and
arrangements, and the Company agrees to file promptly any amendment or
supplement to the Registration Statement or the Prospectus which, in the opinion
of Underwriters' counsel, may thereby be made necessary or advisable.
13. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
14. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
15. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
16. Parties. This Agreement shall inure to the benefit of and be binding
upon the parties and their respective successors. Notwithstanding anything to
the contrary contained
30
herein, neither the stockholders of Equity Office Properties Trust, the general
partner of EOP ("Equity Office"), nor the trustees, officers, employees or
agents of Equity Office shall have any liability under this Agreement, and any
party hereto shall look solely to the property of EOP for the payment of any
claims hereunder against such entity or for the performance of this Agreement by
such entity.
Very truly yours,
CAPITAL TRUST, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Chief Financial Officer
GENERAL MOTORS TRUST BANK,
NATIONAL ASSOCIATION, as trustee for
GMAM Investment Funds Trust
By:/s/ Xxxxxx X. Xxxxxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Managing Director, Real Estate and
Alternative Investments
31
JPMORGAN CHASE BANK, as trustee for the
GMAM Group Pension Trust II
By:/s/ Xxxx X. Xxxxx
----------------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
EOP OPERATING LIMITED PARTNERSHIP
By: EQUITY OFFICE PROPERTIES TRUST, its
general partner
By:/s/ Xxxxx Xxxxxx
----------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President - Legal
Accepted as of the date hereof
XXXXXX XXXXXXX & CO. INCORPORATED
BEAR, XXXXXXX & CO. INC.
XXXXXXXXX & COMPANY, INC.
JMP SECURITIES LLC
Acting severally on behalf of themselves
and the several Underwriters named in
Schedule I attached hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By:/s/ Xxxxx Xxxxxxxxxxx
---------------------------------
Name: Xxxxx Xxxxxxxxxxx
Title: Executive Director
32
SCHEDULE I
__________________________________ _________________________
Number of Firm Shares
Underwriter to Be Purchased
Xxxxxx Xxxxxxx & Co. Incorporated... 1,330,000
Bear, Xxxxxxx & Co. Inc............. 997,500
Xxxxxxxxx & Company, Inc............ 498,750
JMP Securities LLC.................. 498,750
Conifer Securities, LLC............. 175,000
Total: ........................ 3,500,000
I-1
SCHEDULE II
__________________________________ _________________________
Number of Firm
Selling Stockholder Shares to Be Sold
EOP Operating Limited Partnership 1,424,474
GENERAL MOTORS TRUST BANK, NATIONAL
ASSOCIATION, as trustee for the GMAM 49,857
Investment Funds Trust
JPMORGAN CHASE BANK, as trustee for
GMAM Group Pension Trust II 662,380
Total: ........................ 2,136,711
I-2
SCHEDULE III
1. Xxxxxxx X. Xxxxxx
2. Xxxxxx X. Xxxxxxxxx
3. Xxxxxx X. Xxxxxxx
4. Xxxxx X. Xxxxxxx
5. Xxxx X. Xxxxx
6. Xxxxx X. Nassau
7. Xxxxx X. Xxxxxx
8. Xxxxxxx X. Xxxxxx
9. Xxxxxx X. Xxxxx
10. Xxxxx X. Xxxxxxx
11. Xxxxxx Xxxx
12. Veqtor Finance Company, L.L.C.
13. EOP Operating Limited Partnership
14. General Motors Trust Bank National Association, as trustee for the GMAM
Investment Funds Trust
15. XX Xxxxxx Chase Bank, as trustee for GMAM Group Pension Trust II
16. X.X. Xxxxxxx Corporation
17. Admiral Insurance Company (prior to the Closing Date)
18. Berkley Insurance Company (prior to the Closing Date)
19. Berkley Regional Insurance Company (prior to the Closing Date)
20. Nautilus Insurance Company (prior to the Closing Date)
III-1
SCHEDULE IV
Paragraph 4(b) to be added to the comfort letter:
-------------------------------------------------
b. with respect to the period from April 1, 2004 to June 30, 2004, we
have:
(1) read the unaudited consolidated financial statements of the
Company and subsidiaries for the quarter ended June 30th of both
2003 and 2004 furnished us by the Company, officials of the
Company having advised us that no such financial statements as
of any date or for any period subsequent to June 30, 2004, were
available; and
(2) inquired of certain officials of the Company who have
responsibility for financial and accounting matters as to
whether the unaudited consolidated financial statements referred
to under b.(i) are stated on a basis substantially consistent
with that of the audited consolidated financial statements
incorporated by reference in the Registration Statement.
Paragraph 5(b) to be added to the comfort letter:
-------------------------------------------------
b. (i) At June 30, 2004, there was any change in the capital stock,
increase in long-term debt, or any decreases in consolidated net
current assets or stockholders' equity of the consolidated
companies as compared with the amounts shown in the March 31, 2004
unaudited condensed consolidated balance sheet incorporated by
reference in the Registration Statement or (ii) for the period from
April 1, 2004 to June 30, 2004, there were any decreases as
compared with the corresponding period in the preceding year, in
consolidated net sales or in the total or per-share amounts of net
income, except in all instances for changes, increases or decreases
that the Registration Statement discloses have occurred or may
occur.
IV-1
SCHEDULE V
Wholly-owned "qualified REIT subsidiaries"
Xxxxxx Capital Group, LP
CT Xxxxxxx LLC
CT Rosarito Retail LLC
CT-F1 LLC
CT Mezzanine Partners I LLC
CT-F2-LP, LLC
CT Convertible Trust I
CT-BB Funding Corp.
CT LF Funding Corp.
CT BSI Funding Corp.
CT RE CDO 2004-1 Sub, LLC
Capital Trust RE CDO 2004-1 Ltd.
Capital Trust RE CDO 2004-1 Corp.
IV-1
EXHIBIT A
[FORM OF LOCK-UP LETTER (ALL EXCEPT BERKLEY)]
July ___, 2004
Xxxxxx Xxxxxxx & Co. Incorporated
Bear, Xxxxxxx & Co. Inc.
Xxxxxxxxx & Company, Inc.
JMP Securities LLC
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated
("Xxxxxx Xxxxxxx") proposes to enter into an Underwriting Agreement (the
"Underwriting Agreement") with Capital Trust, Inc., a Maryland corporation (the
"Company"), providing for the public offering (the "Public Offering") by the
several Underwriters, including Xxxxxx Xxxxxxx (the "Underwriters"), of shares
of the class A common stock, par value $0.01 per share, of the Company (the
"Common Stock"), of which, (i) 1,363,289 shares will be offered by the Company,
and (ii) 2,136,711 additional shares will be offered by certain selling
stockholders identified in the Underwriting Agreement (the "Selling
Stockholders"). The shares of the Common Stock to be sold by the Company and the
additional shares of the Common Stock to be sold by the Selling Stockholders
shall collectively be called the "Shares".
To induce the Underwriters that may participate in the Public Offering to
continue their efforts in connection with the Public Offering, the undersigned
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 90 days after the date of the final prospectus relating
to the Public Offering (the "Prospectus"), (1) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, 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 (2) 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 (1) or (2) 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 sale of any Shares
to the Underwriters pursuant to the Underwriting Agreement or (b) transactions
relating to shares of Common Stock or other securities acquired in open market
transactions after the closing of the Public Offering, (c) transfers to any
parent, grandparent, stepparent, mother-in-law, father-in-law, spouse, former
spouse, sibling, sister-in-law, brother-in-law, son-in-law,
A-1
daughter-in-law, child, stepchild, grandchild, niece or nephew of the
undersigned, including adoptive relationships (each, a "Family Member"), or (d)
transfers solely for estate planning purposes to any trust for the direct or
indirect benefit of the undersigned or any Family Member or to any corporation,
limited liability company, partnership or other entity beneficially owned,
directly or indirectly, solely by such trusts, the undersigned or any Family
Member; provided, however, that any transferee pursuant to clause (c) or (d)
hereunder agrees to be bound in writing by the restrictions set forth herein. In
addition, the undersigned agrees that, without the prior written consent of
Xxxxxx Xxxxxxx on behalf of the Underwriters, it will not, during the period
commencing on the date hereof and ending 90 days after the date of the
Prospectus, make any demand for or exercise any right with respect to, the
registration of any shares of Common Stock or any security convertible into or
exercisable or exchangeable for Common Stock. The undersigned also agrees and
consents to the entry of stop transfer instructions with the Company's transfer
agent and registrar against the transfer of the undersigned's share of Common
Stock except in compliance with the foregoing restrictions.
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-up Agreement in proceeding toward consummation of the
Public Offering. The undersigned further understands that this Lock-up Agreement
is irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns.
Whether or not the Public Offering actually occurs depends on a number of
factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
Very truly yours,
----------------------------------------
(Name)
----------------------------------------
(Address)
S-1
[FORM OF LOCK-UP LETTER (BERKLEY)]
July ___, 2004
Xxxxxx Xxxxxxx & Co. Incorporated
Bear, Xxxxxxx & Co. Inc.
Xxxxxxxxx & Company, Inc.
JMP Securities LLC
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated
("Xxxxxx Xxxxxxx") proposes to enter into an Underwriting Agreement (the
"Underwriting Agreement") with Capital Trust, Inc., a Maryland corporation (the
"Company"), providing for the public offering (the "Public Offering") by the
several Underwriters, including Xxxxxx Xxxxxxx (the "Underwriters"), of shares
of the class A common stock, par value $0.01 per share, of the Company (the
"Common Stock"), of which, (i) 1,363,289 shares will be offered by the Company,
and (ii) 2,136,711 additional shares will be offered by certain selling
stockholders identified in the Underwriting Agreement (the "Selling
Stockholders"). The shares of the Common Stock to be sold by the Company and the
additional shares of the Common Stock to be sold by the Selling Stockholders
shall collectively be called the "Shares".
To induce the Underwriters that may participate in the Public Offering to
continue their efforts in connection with the Public Offering, the undersigned
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 90 days after the date of the final prospectus relating
to the Public Offering (the "Prospectus"), (1) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, 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 (2) 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 (1) or (2) 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 sale of any Shares
to the Underwriters pursuant to the Underwriting Agreement or (b) transactions
relating to shares of Common Stock or other securities acquired in open market
transactions after the closing of the Public Offering, (c) transfers to any
affiliate controlled by the undersigned (for purposes of clause (c), "affiliate"
means, with respect to any person or entity, any other person or entity that
directly or indirectly controls or is controlled by or is under common control
with such person or entity; and "control" means, when used with respect to any
person or entity,
A-2
possession, whether direct or indirect, of the power to direct or cause the
direction of the management and policies of such person or entity, whether
through the ownership of voting securities, by contract or otherwise), (d)
transfers, sales or other dispositions of shares of Common Stock and other
voting stock such that after such transfers, sales or other dispositions, the
undersigned shall beneficially own shares of Common Stock representing less than
20% of the outstanding Common Stock and other voting stock of the Company,
provided that in such case during the term of this Lock-up Agreement the
undersigned shall only transfer, sell or dispose such amount as is necessary to
ensure that it does not beneficially own 20% or more of the Common Stock and
other voting stock of the Company, (e) transfers to any parent, grandparent,
stepparent, mother-in-law, father-in-law, spouse, former spouse, sibling,
sister-in-law, brother-in-law, son-in-law, daughter-in-law, child, stepchild,
grandchild, niece or nephew of the undersigned, including adoptive relationships
(each, a "Family Member"), or (f) transfers solely for estate planning purposes
to any trust, corporation, limited liability company or partnership related
solely thereto for the direct or indirect benefit of the undersigned or any of
its Family Members; provided, however, that any transferee pursuant to clause
(e) or (f) hereunder agrees to be bound in writing by the restrictions set forth
herein. In addition, the undersigned agrees that, without the prior written
consent of Xxxxxx Xxxxxxx on behalf of the Underwriters, it will not, during the
period commencing on the date hereof and ending 90 days after the date of the
Prospectus, make any demand for or exercise any right with respect to, the
registration of any shares of Common Stock or any security convertible into or
exercisable or exchangeable for Common Stock. The undersigned also agrees and
consents to the entry of stop transfer instructions with the Company's transfer
agent and registrar against the transfer of the undersigned's share of Common
Stock except in compliance with the foregoing restrictions.
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-up Agreement in proceeding toward consummation of the
Public Offering. The undersigned further understands that this Lock-up Agreement
is irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns.
Whether or not the Public Offering actually occurs depends on a number of
factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
Very truly yours,
----------------------------------------
(Name)
----------------------------------------
(Address)
S-1
