NATIONAL RETAIL PROPERTIES, INC. UNDERWRITING AGREEMENT
Exhibit 1.1
$250,000,000
6.875% Notes due 2017
September 4, 0000
Xxxx xx Xxxxxxx Securities LLC
Hearst Tower
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Hearst Tower
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Wachovia Capital Markets, LLC
One Wachovia Center
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
One Wachovia Center
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
As the Representatives of the
several Underwriters named in Schedule I hereto
several Underwriters named in Schedule I hereto
Ladies and Gentlemen:
National Retail Properties, Inc., a Maryland corporation (the “Company”), proposes to issue
and sell to the several Underwriters (the “Underwriters”) named in Schedule I hereto for
whom you are acting as Representatives (the “Representatives”) an aggregate principal amount of
$250,000,000 6.875% Notes due 2017 (the “Securities”), to be issued under an indenture (as the same
has been and may be amended and supplemented, the “Indenture”) dated as of March 25, 1998, as
amended and supplemented by an Eighth Supplemental Indenture (the “Eighth Supplemental Indenture”)
to be dated as of September 10, 2007, between the Company and U.S. Bank National Association, as
successor trustee (the “Trustee”). The respective amounts of the Securities to be so purchased by
the several Underwriters are set forth opposite their names in Schedule I hereto.
As the Representatives, you have advised the Company (a) that you are authorized to enter into
this underwriting agreement (the “Agreement”) on behalf of the several Underwriters, and (b) that
the several Underwriters are willing, acting severally and not jointly, to purchase the principal
amount of Securities set forth opposite their names in Schedule I.
The Company wishes to confirm as follows its agreement with you in connection with the
purchase of the Securities by the several Underwriters.
1. Registration Statement and Prospectus. The Company has prepared and filed with the
Securities and Exchange Commission (the “Commission”) in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder
(collectively, the “Act”), an automatic shelf registration statement, as defined in Rule 405 on
Form S-3 (file number 333-132095) under the Act (“Registration Statement 333-132095”), which
registration statement included a combined prospectus dated February 28, 2006 (the “Basic
Prospectus”), relating to an indeterminate aggregate offering price or number of, among other
securities, the Securities, and has filed with, or transmitted for filing to, or shall promptly
hereafter file with or transmit for filing to, the Commission a supplement to the prospectus
included in such registration statement (the “Prospectus Supplement”) specifically relating to the
Securities and the plan of distribution thereof pursuant to Rule 424. Registration Statement
333-132095, including any amendments thereto filed prior to the Execution Time, became effective
upon filing. Except where the context otherwise requires, Registration Statement 333-132095, on
each date and time that such registration statement and any post-effective amendment or amendments
thereto became or becomes effective (each, an “Effective Date”), including all documents filed as
part thereof and including any information contained in a Prospectus (as defined below)
subsequently filed with the Commission pursuant to Rule 424(b) and deemed part of such registration
statement, collectively, are herein called the “Registration Statement,” and the Basic Prospectus,
as supplemented by the final Prospectus Supplement, in the form first used by the Company in
connection with confirmation of sales of the Securities, is herein called the “Prospectus;” and the
term “Preliminary Prospectus” means any preliminary form of the Prospectus Supplement. The Basic
Prospectus together with the Preliminary Prospectus, as amended or supplemented, immediately prior
to the date and time that this Agreement is executed and delivered by the parties hereto (the
“Execution Time”) is hereafter called the “Pricing Prospectus,” and any “issuer free writing
prospectus” (as defined in Rule 433) relating to the Securities is hereafter called an “Issuer Free
Writing Prospectus.” The Pricing Prospectus, as supplemented by the Issuer Free Writing
Prospectuses, if any, listed in Schedule II hereto or that the parties hereto shall
hereafter expressly agree in writing to treat as part of the Disclosure Package (as defined below),
if any, taken together, are hereafter collectively called the “Disclosure Package.” Any reference
in this Agreement to the Registration Statement, the Disclosure Package, the Prospectus or any
amendment or supplement thereto shall be deemed to refer to and include the documents incorporated
by reference therein pursuant to Item 12 of Form S-3 under the Act (the “Incorporated Documents”),
as of each Effective Date or the Execution Time or the date of the Prospectus, as the case may be
(it being understood that the several specific references in this Agreement to documents
incorporated by reference in the Registration Statement, the Disclosure Package or the Prospectus
are for clarifying purposes only and are not meant to limit the inclusiveness of any other
definition herein). For purposes of this Agreement, all references to the Registration Statement,
the Disclosure Package or the Prospectus or any amendment or supplement thereto shall be deemed to
include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system (“XXXXX”).
All references in this Agreement to financial statements and schedules and other information
which is “contained,” “included,” “stated” or “described” in the Registration Statement, the
Disclosure Package or the Prospectus (and all other references of like import) shall be deemed to
mean and include all such financial statements and schedules and other information which is or is
deemed to be incorporated by reference in the Registration Statement,
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the Disclosure Package or the Prospectus, as the case may be; and all references in this
Agreement to amendments or supplements to the Registration Statement, the Disclosure Package or the
Prospectus shall be deemed to include the filing of any document under the Securities Exchange Act
of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder (the
“Exchange Act”), which is or is deemed to be incorporated by reference in the Registration
Statement, the Disclosure Package or the Prospectus, as the case may be.
2. Agreement to Sell and Purchase. The Company hereby agrees, subject to all the
terms and conditions set forth herein, to issue and sell to the Underwriters and, upon the basis of
the representations, warranties and agreements of the Company herein contained and subject to all
the terms and conditions set forth herein, each Underwriter agrees, severally and not jointly, to
purchase from the Company, at a purchase price of 98.999% of the principal amount thereof, plus
accrued interest, if any, from September 10, 2007, to the Closing Date (as defined in herein), the
principal amount of Securities set forth opposite their respective names on Schedule I to
this Agreement.
3. Offering by Underwriters. It is understood that the several Underwriters propose
to offer the Securities for sale to the public as soon after this Agreement has become effective as
in their judgment is advisable and initially to offer the Securities upon the terms set forth in
the Prospectus.
Each Underwriter, severally and not jointly, represents and agrees that, unless it has or
shall have obtained, as the case may be, the prior written consent of the Company, it has not made
and will not make any offer relating to the Securities that would constitute an Issuer Free Writing
Prospectus or that would otherwise constitute a “free writing prospectus” (as defined in Rule 405)
required to be filed by the Company with the Commission or retained by the Company under Rule 433,
other than the free writing prospectus containing the information contained in the final term sheet
prepared and filed pursuant to Section 5(b) hereto; provided that the prior written consent
of the parties hereto shall be deemed to have been given in respect of the Free Writing
Prospectuses included in Schedule II hereto and any electronic road show.
4. Delivery of the Securities and Payment Therefor. Delivery of and payment for the
Securities shall be made at 10:00 a.m., New York City time, on September 10, 2007, or at such time
on such later date not more than three (3) Business Days after the foregoing date as the
Representatives shall designate, which date and time may be postponed by mutual written agreement
of the Representatives and the Company (such date and time of delivery and payment for the
Securities being herein called the “Closing Date”) (or at such other time on the same or on such
other date, in any event not later than the third Business Day thereafter, as the Underwriters and
the Company may agree in writing). Delivery of the Securities shall be made against payment by the
Representatives of the purchase price thereof, to or upon the order of the Company by wire transfer
payable in same-day funds to an account specified by the Company. The Company shall deliver the
Securities to the Representatives for the respective accounts of the several Underwriters through
the facilities of The Depository Trust Company (“DTC”). The Securities shall be global notes
registered in the name of Cede & Co., as nominee for DTC. The interests of beneficial owners of
the Securities will be represented by book entries on the records of DTC and participating members
thereof. The number and denominations of definitive notes
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so delivered shall be as specified by DTC. The definitive notes for the Securities will be
made available for inspection by the Representatives at the offices of Pillsbury Xxxxxxxx Xxxx
Xxxxxxx LLP, New York, New York, not later than 1:00 p.m., New York time on the Business Day before
the Closing Date, or such other date, time and place as the Representatives and the Company may
agree.
5. Agreements of the Company. The Company agrees with the Underwriters as follows:
(a) If, at the time this Agreement is executed and delivered, it is necessary for a
post-effective amendment to the Registration Statement to be declared effective before the offering
of the Securities may commence, the Company will use its best efforts to cause such post-effective
amendment to become effective as soon as possible and will advise the Representatives promptly and,
if requested by the Representatives, will confirm such advice in writing, immediately after such
post-effective amendment has become effective.
(b) If, at any time prior to the filing of the Prospectus pursuant to Rule 424(b), any event
occurs as a result of which the Disclosure Package would (x) include any untrue statement of a
material fact or omit to state any material fact necessary to make the statements therein in the
light of the circumstances under which they were made or the circumstances then prevailing not
misleading or (y) conflict with the information contained in the Registration Statement, the
Company will (i) notify promptly the Representatives so that any use of the Disclosure Package may
cease until it is amended or supplemented; (ii) amend or supplement the Disclosure Package to
correct such statement, omission or conflicting information; and (iii) supply any amendment or
supplement to the Representatives in such quantities as may be reasonably requested.
(c) The Company will advise the Representatives promptly and, if requested by the
Representatives, will confirm such advice in writing: (i) of any review, issuance of comments, or
request by the Commission or its staff on or for an amendment of or a supplement to the
Registration Statement, any Preliminary Prospectus or the Prospectus or for additional information
regarding the Company, its affiliates or its filings with the Commission, whether or not such
filings are incorporated by reference into the Registration Statement, any Preliminary Prospectus
or the Prospectus; (ii) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of the suspension of qualification of the Securities
for offering or sale in any jurisdiction or the initiation of any proceeding for such purpose or
any examination pursuant to Section 8(e) of the Act relating to the Registration Statement or
Section 8A of the Act in connection with the offering of the Securities; (iii) of the receipt by
the Company of any notification with respect to the suspension of the qualification of the
Securities for sale in any jurisdiction or the institution or threatening of any proceeding for
such purpose; and (iv) within the period of time referred to in the first sentence in subsection
(f) below, of any change in the Company’s condition (financial or other), business, prospects,
properties, net worth or results of operations, or of the happening of any event, which results in
any statement of a material fact made in the Registration Statement or the Prospectus (as then
amended or supplemented) being untrue or which requires the making of any additions to or changes
in the Registration Statement or the Prospectus (as then amended or supplemented) in order to state
a material fact required by the Act to be stated therein or necessary in order to
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make the statements therein not misleading, or of the necessity to amend or supplement the
Prospectus (as then amended or supplemented) to comply with the Act or any other law. If at any
time the Commission shall issue any stop order suspending the effectiveness of the Registration
Statement, the Company will make every reasonable effort to obtain the withdrawal of such order at
the earliest possible time.
(d) The Company will furnish to the Representatives and counsel to the Representatives,
without charge: (i) ten (10) signed copies of the Registration Statement as originally filed with
the Commission and of each amendment thereto, including financial statements and all exhibits to
the Registration Statement; (ii) such number of conformed copies of the Registration Statement as
originally filed and of each amendment thereto, but without exhibits, as the Underwriters may
request; (iii) such number of copies of the Incorporated Documents, without exhibits, as the
Representatives may request; and (iv) ten (10) copies of the exhibits to the Incorporated
Documents. The Company will pay all of the expenses of printing or other production of all
documents relating to the offering.
(e) The Company will not file any amendment to the Registration Statement or make any
amendment or supplement to the Prospectus or, prior to the end of the period of time referred to in
the first sentence in subsection (f) below, file any document which upon filing becomes an
Incorporated Document, of which the Representatives shall not previously have been advised or to
which, after the Representatives shall have received a copy of the document proposed to be filed,
the Representatives shall reasonably object; and no such further document, when it is filed, will
contain an untrue statement of a material fact or will omit to state a material fact required to be
stated therein or necessary in order to make the statements therein not misleading. The Company
will give the Representatives notice of its intention to make any other filing pursuant to the
Exchange Act from the Execution Time to the Closing Time and will furnish the Representatives with
copies of any such documents a reasonable amount of time prior to such proposed filing.
(f) As soon after the execution and delivery of this Agreement as possible and thereafter from
time to time for such period as in the opinion of counsel for the Underwriters a prospectus is
required by the Act to be delivered in connection with sales by the Underwriters or any dealer
(including circumstances where such requirement may be satisfied pursuant to Rule 172), the Company
will file promptly all reports and any definitive proxy or information statements required to be
filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act and the Company will expeditiously deliver to the Underwriters and each dealer,
without charge, as many copies of the Prospectus (and of any amendment or supplement thereto), any
Preliminary Prospectus and any Issuer Free Writing Prospectus as the Representatives may request.
The Company consents to the use of the Prospectus (and of any amendment or supplement thereto) in
accordance with the provisions of the Act and with the securities or blue sky laws of the
jurisdictions in which the Securities are offered by the several Underwriters and by all dealers to
whom Securities may be sold, both in connection with the offering and sale of the Securities and
for such period of time thereafter as the Prospectus is required by the Act to be delivered in
connection with sales by any Underwriters or dealers. If during such period of time: (i) any
event shall occur as a result of which, in the judgment of the Company, or in the opinion of
counsel for the Underwriters, the Prospectus as supplemented would include an untrue statement of a
material fact or omit to state
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any material fact necessary to make the statements therein, in the light of the circumstances
when the Prospectus is delivered to a purchaser, not misleading; or (ii) if it is necessary to
supplement the Prospectus or amend the Registration Statement (or to file under the Exchange Act
any document which, upon filing, becomes an Incorporated Document) in order to comply with the Act,
the Exchange Act or any other law, the Company will promptly notify the Representatives of such
event and forthwith prepare and, subject to the provisions of paragraph (e) above, file with the
Commission an appropriate supplement or amendment thereto (or to such document), and will
expeditiously furnish to the Underwriters and dealers a reasonable number of copies thereof. In
the event that the Company and the Representatives agree that the Prospectus should be amended or
supplemented, the Company, if requested by the Representatives, will promptly issue a press release
announcing or disclosing the matters to be covered by the proposed amendment or supplement.
(g) The Company will: (i) cooperate with the Underwriters and with counsel for the
Underwriters in connection with the registration or qualification of the Securities for offering
and sale by the Underwriters and by dealers under the securities or blue sky laws of such
jurisdictions as the Underwriters may designate; (ii) maintain such qualifications in effect so
long as required for the distribution of the Securities; (iii) pay any fee of the Financial
Industry Regulatory Authority, Inc., in connection with its review of the offering; and (iv) file
such consents to service of process or other documents necessary or appropriate in order to effect
such registration or qualification; provided that in no event shall the Company be
obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take
any action which would subject it to service of process in suits, other than those arising out of
the offering or sale of the Securities, in any jurisdiction where it is not now so subject.
(h) The Company agrees that, unless it has or shall have obtained the prior written consent of
the Representatives, it has not made and will not make any offer relating to the Securities that
would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a “free
writing prospectus” (as defined in Rule 405) required to be filed by the Company with the
Commission or retained by the Company under Rule 433, other than the free writing prospectus
containing the information contained in the final term sheet prepared and filed pursuant to Section
5(t) hereto; provided that the prior written consent of the parties hereto shall be deemed
to have been given in respect of the Free Writing Prospectuses included in Schedule II
hereto and any electronic road show. Any such free writing prospectus consented to by the
Representatives or the Company is hereinafter referred to as a “Permitted Free Writing Prospectus.”
The Company agrees that (x) it has treated and will treat, as the case may be, each Permitted Free
Writing Prospectus as an Issuer Free Writing Prospectus and (y) it has complied and will comply, as
the case may be, with the requirements of Rules 164 and 433 applicable to any Permitted Free
Writing Prospectus, including in respect of timely filing with the Commission, legending and record
keeping.
(i) The Company will make generally available to its security holders and to the
Representatives a consolidated earnings statement, which need not be audited, covering a 12-month
period commencing after the effective date of this Agreement and ending not later than 15 months
thereafter, as soon as practicable after the end of such period, which consolidated earnings
statement shall satisfy the provisions of Section 11(a) of the Act and Rule 158 under the Act.
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(j) During the period commencing on the date hereof and ending on the date occurring three (3)
years hereafter, the Company will furnish to the Representatives: (i) as soon as available, if
requested, a copy of each report of the Company mailed to stockholders or filed with the
Commission; and (ii) from time to time such other information concerning the Company as the
Representatives may reasonably request.
(k) If this Agreement shall terminate or shall be terminated after execution pursuant to any
provisions hereof, or if this Agreement shall be terminated by the Underwriters because of any
inability, failure or refusal on the part of the Company to comply with the terms or fulfill any of
the conditions of this Agreement, the Company shall reimburse the Underwriters for all
out-of-pocket expenses (including fees and expenses of counsel for the Underwriters) incurred by
the Underwriters in connection herewith.
(l) The Company will apply the net proceeds from the sale of the Securities substantially in
accordance with the description set forth in the Prospectus.
(m) If Rule 430A, 430B or 430C of the Act is employed, the Company will timely file the
Prospectus pursuant to Rule 424(b) under the Act and will advise the Underwriters of the time and
manner of such filing.
(n) The Company has not taken, nor will it take, directly or indirectly, any action designed
to, or that might reasonably be expected to cause or result in, under the Exchange Act or
otherwise, stabilization or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(o) The Company will comply and will use its best efforts to cause its tenants to comply in
all material respects with all applicable Environmental Laws (as hereinafter defined).
(p) The Company will use its best efforts to continue to qualify as a real estate investment
trust (a “REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”), and to continue
to have each of its corporate subsidiaries (other than its taxable REIT subsidiaries) comply with
all applicable laws and regulations necessary to maintain a status as a REIT or a “qualified REIT
subsidiary” under the Code.
(q) The Company will use all reasonable best efforts to do or perform all things required to
be done or performed by the Company prior to the Closing Date to satisfy all conditions precedent
to the delivery of the Securities pursuant to this Agreement.
(r) The Company will not, without the prior written consent of the Representatives, offer,
sell, contract to sell, pledge, or otherwise dispose of, or enter into any transaction which is
designed to, or might reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or otherwise) by the Company
or any affiliate of the Company or any person in privity with the Company or any affiliate of the
Company, directly or indirectly, including the filing (or participation in the filing) of a
registration statement with the Commission in respect of, or establish or increase a put equivalent
position or liquidate or decrease a call equivalent position within the meaning of Section 16 of
the Exchange Act, any debt securities or guarantees thereon
7
(other than the Securities) or publicly announce an intention to effect any such transaction,
until the Closing Date.
(s) The Company will comply with all applicable securities and other applicable laws, rules
and regulations, including, without limitation, the Xxxxxxxx-Xxxxx Act of 2002 (the “Xxxxxxxx-Xxxxx
Act”), and to use its best efforts to cause the Company’s directors and officers, in their
capacities as such, to comply with such laws, rules and regulations, including, without limitation,
the provisions of the Xxxxxxxx-Xxxxx Act.
(t) Unless requested otherwise by the Representative, the Company will prepare a final term
sheet, containing solely a description of final terms of the Securities and the offering thereof,
in the form and substance approved by the Representatives and attached as Exhibit A hereto
and will file such final term sheet with the Commission as soon as practical after the Execution
Time. The Company will file any other Issuer Free Writing Prospectus to the extent required by
Rule 433 under the Securities Act and will pay any required registration fee for this offering
pursuant to Rule 456(b)(1) under the Securities Act within the time period required by such rule
(without regard to the proviso therein relating to the four (4) Business Days extension to the
payment deadline) and in any event prior to the Closing Date. The Company will retain, pursuant to
reasonable procedures developed in good faith, copies of each Issuer Free Writing Prospectus that
is not filed with the Commission in accordance with Rule 433(g) under the Securities Act.
6. Representations and Warranties of the Company. The Company hereby represents and
warrants to each of the Underwriters:
(a) The Basic Prospectus and each Preliminary Prospectus, if any, included as part of the
registration statement as originally filed or as part of any amendment or supplement thereto, or
filed pursuant to Rule 424 under the Act, complied when so filed in all material respects with the
provisions of the Act.
(b) The Company and the transactions contemplated by this Agreement meet all of the
requirements for using Form S-3 under the Act pursuant to the standards for such form in effect
currently and immediately prior to October 21, 1992. The Registration Statement, including any
amendments thereto filed prior to the Execution Time, became effective upon filing. No stop order
suspending the effectiveness of the Registration Statement is in effect, and no proceedings or
examination under Section 8(d) or 8(e) of the Act are pending before or, to the best of the
Company’s knowledge, threatened by the Commission. The Company is not the subject of a pending
proceeding under Section 8A of the Act in connection with the offering of the Securities. The
Registration Statement meets the requirements set forth in Rule 415(a)(1)(x) under the Act and
complies in all other material respects with such Rule. The Registration Statement, in the form in
which it became effective, and also in such form as it may be when any post-effective amendment
thereto shall become effective, and the Preliminary Prospectus and the Prospectus and any
supplement or amendment thereto, each when filed with the Commission under Rule 424(b) under the
Act, complied or will comply in all material respects with the provisions of the Act, the Exchange
Act and the Trust Indenture Act of 1939, as amended, and the rules and regulations promulgated
thereunder (the “Trust Indenture Act”). The Company has not received from the Commission any
notice pursuant to Rule 401(g)(2) of the Act
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objecting to the use of the shelf registration statement form. On each Effective Date and at
the Execution Time, the Registration Statement did 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 made therein not misleading. On the date of any filing pursuant to Rule 424(b) and on
the Closing Date, the Prospectus (together with any supplement thereto) will not, include any
untrue statement of a material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not misleading.
On the date that the Registration Statement, any post-effective amendment or amendments thereto
became or will become effective and on the Closing Date, the Indenture did or will comply in all
material respects with the applicable requirements of the Trust Indenture Act and the rules
thereunder. The Indenture has been qualified under the Trust Indenture Act. The representation
and warranty contained in this Section 6(b) does not apply to (i) that part of the registration
statement which shall constitute the Statement of Eligibility and Qualification (Form T-1) under
the Trust Indenture Act of the Trustee or (ii) statements in or omissions from the Registration
Statement, the Disclosure Package or the Prospectus made in reliance upon and in conformity with
information relating to the Underwriters furnished to the Company in writing by or on behalf of the
Underwriters expressly for use therein.
(c) (i) The Disclosure Package, and (ii) each electronic road show when taken together as a
whole with the Disclosure Package, did not at the Execution Time, and will not on the Closing Date,
contain any untrue statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under which they were made,
not misleading. The preceding sentence does not apply to statements in or omissions from the
Disclosure Package made in reliance upon and in conformity with information relating to the
Underwriters furnished to the Company in writing by or on behalf of the Underwriters expressly for
use therein.
(d) (i) At the time of filing the Registration Statement, (ii) at the time of the most recent
amendment thereto for the purposes of complying with Section 10(a)(3) of the Act (whether such
amendment was by post-effective amendment, incorporated report filed pursuant to Sections 13 or
15(d) of the Exchange Act or form of prospectus), (iii) at the time the Company or any person
acting on its behalf (within the meaning, for this clause only, of Rule 163(c)) made any offer
relating to the Securities in reliance on the exemption in Rule 163, and (iv) at the Execution Time
(with such date being used as the determination date for purposes of this clause (iv)), the Company
was or is (as the case may be) a “well-known seasoned issuer” as defined in Rule 405.
(e) (i) At the earliest time after the filing of the Registration Statement that the Company
or another offering participant made a bona fide offer (within the meaning of Rule 164(h)(2)) of
the Securities and (ii) as of the Execution Time (with such date being used as the determination
date for purposes of this clause (ii)), the Company was not and is not an Ineligible Issuer (as
defined in Rule 405), without taking account of any determination by the Commission pursuant to
Rule 405 that it is not necessary that the Company be considered an Ineligible Issuer.
(f) Each Issuer Free Writing Prospectus and the final term sheet prepared and filed pursuant
to Section 5(t) hereof does not include any information that conflicts with the information
contained in the Registration Statement, including any Incorporated Document by
9
reference therein and any prospectus supplement deemed to be a part thereof that has not been
superseded or modified. The foregoing sentence does not apply to statements in or omissions from
any Issuer Free Writing Prospectus based upon and in conformity with written information furnished
to the Company by any Underwriter through the Representatives specifically for use therein, it
being understood and agreed that the only such information furnished by or on behalf of any
Underwriter consists of the information described as such in Section 12 hereof.
(g) The Incorporated Documents heretofore filed, when they were filed (or, if any amendment
with respect to any such document was filed, when such amendment was filed), conformed in all
material respects with the requirements of the Exchange Act and the rules and regulations of the
Commission thereunder. The Company has given the Representatives notice of any filings made
pursuant to the Exchange Act within 48 hours prior to the Execution Time. No such document when it
was filed (or, if an amendment with respect to any such document was filed, when such amendment was
filed), contained an untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements made therein, in light
of the circumstances under which they were made, not misleading.
(h) Upon the delivery of the Securities pursuant to Section 4 of this Agreement, the
Securities will be validly issued pursuant to the Indenture, will be valid and legally binding
obligations of the Company, and will conform in all material respects to the description of the
Securities contained in the Disclosure Package and the Prospectus.
(i) Each of the Company and each of its subsidiaries is a corporation, limited liability
company, partnership or trust, as applicable, duly organized, validly existing and in good standing
under the laws of the state of its formation, as set forth on Schedule III hereto, with
full corporate, partnership or trust power, as applicable, and authority to own, lease and operate
its properties and to conduct its business as described in the Registration Statement, the
Disclosure Package and the Prospectus, and each is duly registered and qualified to conduct its
business, and is in good standing, in each jurisdiction or place where the nature of its properties
or the conduct of its business requires such registration or qualification, except where the
failure so to register or qualify does not have a material adverse effect on the condition
(financial or other), prospects, earnings, business, properties, net worth or results of operations
of the Company and its subsidiaries taken as a whole, whether or not arising from transactions in
the ordinary course of business (“Material Adverse Effect”).
(j) Neither the Company nor any of its subsidiaries does any business in Cuba.
(k) The Company has no subsidiary or subsidiaries other than as set forth on Schedule
III hereto, and does not control, directly or indirectly, any corporation, partnership, joint
venture, association or other business association. The issued shares of capital stock of each of
the Company’s subsidiaries have been duly authorized and validly issued, are fully paid and
non-assessable and are owned legally and beneficially by the Company free and clear of any security
interests, liens, encumbrances, equities or claims.
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(l) There are no legal or governmental actions, suits or proceedings pending or, to the
knowledge of the Company, threatened, against the Company or any of its subsidiaries, or to which
the Company or any properties of the Company or any of its subsidiaries is subject, that (A) are
required to be described in the Registration Statement or the Prospectus but are not described as
required; (B) could reasonably be expected to have a material adverse effect on the performance of
this Agreement or the consummation of any of the transactions contemplated hereby; or (C) could
reasonably be expected to have a Material Adverse Effect, except as set forth in or contemplated in
the Disclosure Package and the Prospectus (exclusive of any supplement thereto). There are no
statutes, regulations, capital expenditures, off-balance sheet transactions, contingencies or
agreements, contracts, indentures, leases or other instruments or documents of a character that are
required to be described in the Registration Statement or the Prospectus or to be filed or
incorporated by reference as an exhibit to the Registration Statement or any Incorporated Document
that are not described, filed or incorporated as required by the Act or the Exchange Act (and the
Pricing Prospectus contains in all material respects the same description of the foregoing matters
contained in the Prospectus). The statements in the Prospectus under the heading “Federal Income
Tax Considerations” and in the Pricing Prospectus and the Prospectus Supplement under the heading
“Certain Federal Income Tax Considerations” fairly summarize the matters therein described.
(m) Neither the Company nor any of its subsidiaries is: (A) in violation of (i) its
respective articles of incorporation or by-laws, (ii) any law, ordinance, administrative or
governmental rule or regulation applicable to the Company or its subsidiaries, which violation
would have a Material Adverse Effect, or (iii) any decree of any court or governmental agency or
body having jurisdiction over the Company or its subsidiaries; or (B) in default in any material
respect in the performance of any obligation, agreement, condition or covenant (financial or
otherwise) contained in any bond, debenture, note or any other evidence of indebtedness or in any
material agreement, indenture, lease or other instrument to which the Company or any of its
subsidiaries is a party or by which the Company or its subsidiaries or any of their respective
properties may be bound, and no such default is foreseeable.
(n) (A) As of the date of this Agreement, the Company owns either directly or through
investment interests, 909 properties (the “Properties”). To the best of the Company’s knowledge,
neither the Company nor any of its subsidiaries is in violation of any municipal, state or federal
law, rule or regulation concerning any of their Properties, which violation would have a Material
Adverse Effect; (B) to the best of the Company’s knowledge, each of the Properties complies with
all applicable zoning laws, ordinances and regulations in all material respects and, if and to the
extent there is a failure to comply, such failure does not materially impair the value of any of
such Properties and will not result in a forfeiture or reversion of title thereof; (C) neither the
Company nor any of its subsidiaries has received from any governmental authority any written notice
of any condemnation of, or zoning change affecting any of, the Properties, and the Company does not
know of any such condemnation or zoning change which is threatened and which if consummated would
have a material adverse effect on the Company or any of such Properties; (D) the leases under which
the Company leases the Properties as lessor (the “Leases”) are in full force and effect and have
been entered into in the ordinary course of business of the Company; (E) the Company and each of
its subsidiaries has complied with its respective obligations under the Leases in all material
respects and the Company does not know of any default by any other party to the Leases which, alone
or together with other such defaults,
11
would have a Material Adverse Effect or material adverse effect on any of the properties
subject to a Lease; and (F) all liens, charges, encumbrances, claims or restrictions on or
affecting the Properties and assets (including the Properties) of the Company and its subsidiaries
that are required to be disclosed in the Prospectus are disclosed therein.
(o) Neither the issuance and sale of the Securities, the execution, delivery or performance of
this Agreement by the Company, nor the consummation by the Company of the transactions contemplated
hereby (including the application of the proceeds from the sale of the Securities), nor the
fulfillment of the terms hereof or of the Indenture: (A) requires any consent, approval,
authorization or other order of, or registration or filing with, any court, regulatory body,
administrative agency or other governmental body, agency or official (except such as may be
required for the registration of the Securities under the Act and compliance with the securities or
blue sky laws of various jurisdictions), or conflicts or will conflict with or constitutes or will
constitute a breach or violation of, or a default under, the articles of incorporation or by-laws
of the Company or any of its subsidiaries; or (B) conflicts or will conflict with or constitutes or
will constitute a breach of, or a default under, any agreement, indenture, lease or other
instrument to which the Company or any of its subsidiaries is a party or by which the Company or
any properties of the Company or any of its subsidiaries may be bound, or violates or will violate
any statute, law, regulation or filing or judgment, injunction, order or decree applicable to the
Company or any of its subsidiaries or any properties of the Company or any of its subsidiaries, or
will result in the creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to the terms of any agreement or
instrument to which the Company or any of its subsidiaries is a party or by which the Company or
any of its subsidiaries may be bound, or to which any property or assets of the Company or any of
its subsidiaries is subject.
(p) To the Company’s knowledge, each of KPMG LLP and Ernst & Young LLP, who have certified or
shall certify certain financial statements and schedules included or incorporated by reference in
the Registration Statement, the Pricing Prospectus and the Prospectus (or any amendment or
supplement thereto), is, as of September 4, 2007 and was during the periods covered by the
financial statements on which we reported, an independent registered public accounting firm with
respect to the Company as required by the Act and the Exchange Act and the applicable published
rules and regulations thereunder and by the Public Company Accounting Oversight Board.
(q) The financial statements, together with related schedules and notes, included or
incorporated by reference in the Registration Statement, the Pricing Prospectus and the Prospectus
(and any amendment or supplement thereto), present fairly in all material respects the financial
position, results of operations and changes in financial position of the Company and its
subsidiaries on the basis stated in the Registration Statement and the Incorporated Documents at
the respective dates or for the respective periods to which they apply. Such statements and
related schedules and notes have been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved, except as disclosed therein. The
other financial and statistical information and data included or incorporated by reference in the
Registration Statement, the Pricing Prospectus and the Prospectus (and any amendment or supplement
thereto) are accurately presented and prepared on a basis consistent with such financial statements
and the books and records of the Company and its subsidiaries.
12
The pro forma financial statements and other pro forma financial information included, or
incorporated by reference in, the Registration Statement, the Pricing Prospectus and the Prospectus
include assumptions that provide a reasonable basis for presenting the significant effects directly
attributable to the transactions and events described therein, the related pro forma adjustments
give appropriate effect to those assumptions, and the pro forma adjustments reflect the proper
application of those adjustments to the historical financial statement amounts in the pro forma
financial statements included in the Prospectus, the Pricing Prospectus and the Registration
Statement. The pro forma financial statements included in the Prospectus , the Pricing Prospectus
and the Registration Statement comply as to form in all material respects with the applicable
accounting requirements of Regulation S-X under the Act and the pro forma adjustments have been
properly applied to the historical amounts in the compilation of those statements. The Company has
filed with the Commission all financial statements, together with related schedules and notes,
required to be filed pursuant to Regulation S-X under the Act.
(r) The Company has the corporate power to issue, sell and deliver the Securities as provided
herein; the execution and delivery of, and the performance by the Company of its obligations under,
this Agreement and the Indenture (including the Eighth Supplemental Indenture thereto) have been
duly and validly authorized by the Company, and this Agreement and the Indenture (including the
Eighth Supplemental Indenture thereto) have been duly executed and delivered by the Company and
constitute the valid and legally binding agreements of the Company, enforceable against the Company
in accordance with their terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors’ rights generally and by general principles of
equity and to the extent that rights to indemnity and contribution hereunder may be limited by
federal or state securities laws.
(s) Except as disclosed in the Registration Statement, the Disclosure Package and the
Prospectus (or any amendment or supplement thereto), subsequent to the respective dates as of which
such information is given in the Registration Statement, the Disclosure Package and the Prospectus
(or any amendment or supplement thereto), neither the Company nor any of its subsidiaries has
incurred any liability or obligation (financial or other), direct or contingent, or entered into
any transaction (including any off-balance sheet activities or transactions), not in the ordinary
course of business, that is material to the Company and its subsidiaries, and there has not been
any change in the capital stock, or material increase in the short-term debt or long-term debt
(including any off-balance sheet activities or transactions), of either the Company or its
subsidiaries, or any material adverse change, or any development involving or which may reasonably
be expected to involve, a prospective material adverse change, in the condition (financial or
other), business, prospects, net worth or results of operations of either the Company or its
subsidiaries.
(t) The Company and each of its subsidiaries has good and marketable title to all property
(real and personal) described in the Disclosure Package and the Prospectus as being owned by each
of them (including the Properties), free and clear of all liens, claims, security interests or
other encumbrances that would materially and adversely affect the value thereof or materially
interfere with the use made or presently contemplated to be made thereof by them as described in
the Prospectus, except such as are described in the Registration Statement, the Disclosure Package
and the Prospectus, or in any document filed as an exhibit to the Registration
13
Statement, and each property described in the Disclosure Package and the Prospectus as being
held under lease by the Company or any of its subsidiaries is held by it under a valid, subsisting
and enforceable lease.
(u) The “significant subsidiaries” of the Company as defined in Section 1-02(w) of Regulation
S-X are set forth in Schedule III hereto (the “Significant Subsidiaries”).
(v) The Company has not distributed and, prior to the later to occur of (x) the Closing Date
and (y) completion of the distribution of the Securities, will not distribute, any offering
material in connection with the offering and sale of the Securities other than the Registration
Statement, the Disclosure Package or the Prospectus. The Company has not, directly or indirectly:
(i) taken any action designed to cause or to result in, or that has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Securities; or (ii) since the
filing of the Registration Statement (A) sold, bid for, purchased, or paid anyone any compensation
for soliciting purchases of, the Securities or (B) paid or agreed to pay to any person any
compensation for soliciting another to purchase any other securities of the Company.
(w) The Company and each of its subsidiaries possess all certificates, permits, licenses,
franchises and authorizations of governmental or regulatory authorities (the “permits”) as are
necessary to own their respective properties and to conduct their respective businesses in the
manner described in the Disclosure Package and the Prospectus, where such failure to possess could
have a Material Adverse Effect, subject to such qualifications as may be set forth in the
Disclosure Package and the Prospectus. The Company and each of its subsidiaries has fulfilled and
performed all of their respective material obligations with respect to such permits, and no event
has occurred which allows, or after notice or lapse of time would allow, revocation or termination
thereof or which would result in any other material impairment of the rights of the holder of any
such permit, subject in each case to such qualification as may be set forth in the Disclosure
Package and the Prospectus. Except as described in the Disclosure Package and the Prospectus,
exclusive of any supplement thereto, neither the revocation or modification of any permit singly or
in the aggregate, nor the announcement of an unfavorable decision, ruling or finding with respect
to any permit, would have a Material Adverse Effect.
(x) The Company and each of its subsidiaries have established and maintain disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) that are designed to
ensure that information required to be disclosed by the Company in the reports that it files or
submits under the Exchange Act is recorded, processed, summarized and reported, within the time
periods specified in the Commission’s rules and forms and is accumulated and communicated to the
Company’s management, including its chief executive officer and chief financial officer, or persons
performing similar functions, as appropriate to allow timely decisions regarding required
disclosure; and the Company and each of its subsidiaries maintain a system of internal control over
financial reporting sufficient to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles and which includes policies and procedures that (i)
pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the
transactions and dispositions of the assets of the Company and each of its subsidiaries, (ii)
provide reasonable assurance that
14
transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles and that receipts and expenditures of the
Company and each of its subsidiaries are being made only in accordance with the authorization of
management, and (iii) provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisitions, use or dispositions of assets that could have a material effect on the
financial statements. The Company’s disclosure controls and procedures have been evaluated for
effectiveness as of the end of the period covered by the Company’s most recently filed quarterly
report on Form 10-Q which precedes the date of the Prospectus and were effective in all material
respects to perform the functions for which they were established. Based on the most recent
evaluation of its internal control over financial reporting, the Company was not aware of (i) any
material weaknesses in the design or operation of internal control over financial reporting or (ii)
any fraud, whether or not material, that involves management or other employees who have a
significant role in the Company’s internal control over financial reporting. There has been no
change in the Company’s internal control over financial reporting that has occurred during its most
recently completed fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the Company’s internal control over financial reporting.
(y) There is and has been no failure on the part of the Company and any of the Company’s
directors or officers, in their capacities as such, to comply with any provision of the
Xxxxxxxx-Xxxxx Act and the rules and regulations promulgated in connection therewith, including,
without limitation, Section 402 related to loans to insiders and Sections 302 and 906 related to
certifications.
(z) To the Company’s knowledge, neither the Company and its subsidiaries nor any employee or
agent of the Company and its subsidiaries has made any payment of funds of the Company or its
subsidiaries or received or retained any funds in violation of any law, rule or regulation, which
payment, receipt or retention of funds is of a character required to be disclosed in the
Prospectus.
(aa) No labor problem or dispute with the employees of the Company and/or any of its
subsidiaries or any of the Company’s or its subsidiaries’ principal suppliers, contractors or
customers, exists, is threatened or imminent that could result in a Material Adverse Effect. To
the Company’s knowledge, no labor problem or dispute with the Company’s or its subsidiaries’
tenants exists, is threatened or imminent that could result in a Material Adverse Effect.
(bb) The Company has filed all foreign, federal, state and local tax returns that are required
to be filed, which returns are complete and correct, or has requested extensions thereof (except in
any case in which the failure so to file would not have a Material Adverse Effect, except as set
forth in the Disclosure Package and the Prospectus) and has paid all taxes required to be paid by
it and any other assessment, fine or penalty levied against it, to the extent that any of the
foregoing is due and payable, except for any such assessment, fine or penalty that is currently
being contested in good faith or as would not have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in the Disclosure Package and the Prospectus (exclusive of any
supplement thereto).
15
(cc) No holder of any security of the Company has any right to require registration of the
Securities or any other security of the Company because of the filing of the Registration Statement
or consummation of the transactions contemplated by this Agreement, which right has not been waived
in connection with the transactions contemplated by this Agreement.
(dd) The Company and its subsidiaries own or possess all patents, trademarks, trademark
registrations, service marks, service xxxx registrations, trade names, copyrights, licenses,
inventions, trade secrets and rights described in the Disclosure Package and the Prospectus as
being owned by them or necessary for the conduct of their respective businesses. The Company is
not aware of any claim to the contrary or any challenge by any other person to the rights of the
Company and its subsidiaries with respect to the foregoing.
(ee) The Company is not now, and after sale of the Securities to be sold by the Company
hereunder and the application of the net proceeds from such sale as described in the Pricing
Prospectus and the Prospectus under the caption “Use of Proceeds,” will not be, an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.
(ff) (i) To the best of the Company’s knowledge, the Company, its subsidiaries, the Properties
and the operations conducted thereon comply and heretofore have complied with all applicable
Environmental Laws, and no expenditures are required or advisable to maintain or achieve such
compliance and except as is disclosed in the Environmental Reports (defined below) and except for
non-compliance and expenditures that have not and will not likely to have a material adverse effect
on the relevant Property.
(ii) Neither the Company nor any of its subsidiaries has at any time and, to
the best of the Company’s knowledge, no other party has at any time, handled,
buried, stored, retained, refined, transported, processed, manufactured, generated,
produced, spilled, allowed to seep, leak, escape or xxxxx, or be pumped, poured,
emitted, emptied, discharged, injected, dumped, transferred or otherwise disposed of
or dealt with, Hazardous Materials (as defined below) on, to, under or from the
Properties, except as disclosed in environmental site assessment reports obtained by
the Company on or before the date hereof in connection with the purchase of any of
the Properties and directly provided to the Underwriters or their counsel
(collectively, the “Environmental Reports”) and except for those circumstances that
have not had and will not have a material adverse effect on the relevant Property.
Neither the Company nor any of its subsidiaries intends to use the Properties or any
subsequently acquired properties for the purpose of handling, burying, storing,
retaining, refining, transporting, processing, manufacturing, generating, producing,
spilling, seeping, leaking, escaping, leaching, pumping, pouring, emitting,
emptying, discharging, injecting, dumping, transferring or otherwise disposing of or
dealing with Hazardous Materials.
(iii) To the best of the Company’s knowledge, no seepage, leak, escape, xxxxx,
discharge, injection, release, emission, spill, pumping, pouring, emptying
16
or dumping of Hazardous Materials into any surface water, groundwater, soil,
air or other media on or adjacent to the Properties has occurred, is occurring or is
reasonably expected to occur, except as is disclosed in the Environmental Reports
and except for those circumstances not likely to have a material adverse effect on
the relevant Property.
(iv) Neither the Company nor any of its subsidiaries has received notice from
any Governmental Authority or other person of, or has knowledge of, any occurrence
or circumstance which, with notice, passage of time, or failure to act, would give
rise to any claim under or pursuant to any Environmental Law or under common law
pertaining to Hazardous Materials on or originating from the existing Properties or
any act or omission of any party with respect to the existing Properties, except as
disclosed in the Environmental Reports.
(v) To the best of the Company’s knowledge, none of the Properties is included
or proposed for inclusion on any federal, state, or local lists of sites which
require or might require environmental cleanup, including, but not limited to, the
National Priorities List or CERCLIS List issued pursuant to CERCLA (as defined
below) by the United States Environmental Protection Agency or any analogous state
list.
(vi) In the ordinary course of its business, the Company periodically reviews
the effect of Environmental Laws on the business, operations and properties of the
Company and its subsidiaries, in the course of which it identifies and evaluates
associated costs and liabilities (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). On the
basis of such review, the Company has reasonably concluded that such associated
costs and liabilities would not, singly or in the aggregate, have a Material Adverse
Effect, whether or not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Disclosure Package and the Prospectus.
As used herein, “Hazardous Material” shall include, without limitation, any flammable
explosives, radioactive materials, hazardous materials, hazardous wastes, hazardous or toxic
substances, or related materials, asbestos, polychlorinated biphenyls (“PCBs”), petroleum products
and by-products and substances defined or listed as “hazardous substances,” “toxic substances,”
“hazardous waste,” or “hazardous materials” in any Federal, state or local Environmental Law.
As used herein, “Environmental Law” shall mean all laws, common law duties, regulations or
ordinances (including any orders or agreements) of any Federal, state or local governmental
authority having or claiming jurisdiction over any of the Properties (a “Governmental Authority”)
that are designed or intended to protect the public health and the environment or to regulate the
handling of Hazardous Materials, including, without limitation, the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as
17
amended (42 U.S.C. Section 9601 et seq.) (“CERCLA”), the Hazardous Material Transportation
Act, as amended (49 U.S.C. Section 1801 et seq.), the Resource Conservation and Recovery Act, as
amended (42 U.S.C. Section 6901 et seq.), the Federal Water Pollution Control Act, as amended (33
U.S.C. Section 1251 et seq.), and the Clean Air Act, as amended (42 U.S.C. Section 7401 et seq.),
and any and all analogous future federal or present or future state or local laws.
(gg) The Company is organized in conformity with the requirements for qualification as a real
estate investment trust under Sections 856 through 860 of the Code and the rules and regulations
thereunder. As of the close of every taxable year during the Company’s existence, the Company has
had no earnings and profits accumulated in a non-REIT year within the meaning of Section
857(a)(2)(B) of the Code. The Company’s past and proposed method of operation have enabled it, and
will enable it, to meet the requirements for taxation as a REIT under the Code.
(hh) The Company has ten (10) “taxable REIT subsidiaries” within the meaning of Section 856(l)
of the Code and with respect to each such “taxable REIT subsidiary,” the election under Section
856(l)(1)(b) of the Code has been, or will be, timely made and has not been revoked or taxable REIT
subsidiary status was imposed under the provisions of Section 856(l)(2) of the Code. Each of the
Company’s corporate subsidiaries, except for its taxable REIT subsidiaries, is in compliance with
all requirements applicable to a REIT or a “qualified REIT subsidiary” within the meaning of
Section 856(i) of the Code and all applicable regulations under the Code, and the Company is not
aware of any fact that would negatively impact such qualifications. Each of the Company’s
non-corporate subsidiaries qualifies as a partnership or a disregarded entity for federal income
tax purposes.
(ii) The Company and each of its subsidiaries is insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are prudent and customary in
the businesses in which they are engaged and the value of their properties. All policies of
insurance and fidelity or surety bonds insuring the Company or any of its subsidiaries or their
respective businesses, assets, employees, officers and directors are in full force and effect. The
Company and its subsidiaries are in compliance with the terms of such policies and instruments in
all material respects and there are no claims by the Company or any of its subsidiaries under any
such policy or instrument as to which any insurance company is denying liability or defending under
a reservation of rights clause. Neither the Company nor any of its subsidiaries has been refused
any insurance coverage sought or applied for, and the Company does not have any reason to believe
that the Company and each of its subsidiaries will not be able to renew its respective existing
insurance coverage as and when such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue their respective businesses at a cost that would not have
a Material Adverse Effect.
(jj) The Company and its subsidiaries have title insurance on each of the Properties owned in
fee simple in amounts at least equal to the cost of acquisition of such property; with respect to
an uninsured loss on any of the Properties, the title insurance shortfall would not have a Material
Adverse Effect.
18
(kk) No subsidiary of the Company is currently prohibited, directly or indirectly, from paying
any dividends to the Company, from making any other distribution on such subsidiary’s capital
stock, from repaying to the Company any loans or advances to such subsidiary from the Company or
from transferring and of such subsidiary’s assets or property to the Company or any other
subsidiary of the Company, except as described in the Disclosure Package and the Prospectus.
(ll) 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 by the Company or sale by the Company of
the Securities.
(mm) Each of the Company and its subsidiaries has fulfilled its obligations, if any, under the
minimum funding standards of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Employee Retirement Income Security
Act of 1974 (“ERISA”) and the regulations and published interpretations thereunder with respect to
each “plan” (as defined in Section 3(3) of ERISA and such regulations and published
interpretations) in which employees of the Company and its subsidiaries are eligible to
participate. Each such plan is in compliance in all material respects with the presently
applicable provisions of ERISA and such regulations and published interpretations. Neither the
Company nor any of its subsidiaries has incurred any unpaid liability to the Pension Benefit
Guaranty Corporation (other than for the payment of premiums in the ordinary course) or to any such
plan under Title IV of ERISA.
(nn) To the knowledge of the Company, no stock options awards granted by the Company have been
retroactively granted, or the exercise or purchase price of any stock option award determined
retroactively.
(oo) The Company’s authorized capitalization is as set forth in the Registration Statement,
the Disclosure Package and the Prospectus; the authorized capital stock, debt securities and the
Securities of the Company conform in all material respects to the description thereof contained in
the Registration Statement, the Disclosure Package and the Prospectus; the outstanding shares of
common stock of the Company have been duly and validly authorized and issued in compliance with all
Federal and state securities laws, and are fully paid and non-assessable.
7. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each Underwriter, the directors,
officers, employees, affiliates and agents of each Underwriter and each person who controls any
Underwriter, within the meaning of either the Act or the Exchange Act, against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or other Federal or state statutory law or regulation, at common
law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) (i) arise out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement for the registration of the Securities as
originally filed or in any amendment thereof, or in the Basic Prospectus, any Preliminary
Prospectus, the Prospectus, any Issuer Free Writing Prospectus or the information
19
contained in the final term sheet required to be prepared and filed pursuant to Section 5(t)
hereto or in any amendment thereof or supplement thereto; or (ii) arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; or (iii) arise out of or are based upon a
breach of the representations and warranties in this Agreement. The Company agrees to reimburse
each such indemnified party, as incurred, for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Company will not be liable in any such case
arising in connection with this Section 7 to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein. This indemnity agreement will be in addition to any liability,
which the Company may otherwise have.
(b) Each Underwriter, severally and not jointly, agrees to indemnify and hold harmless the
Company, each of its directors, each of its officers who signs the Registration Statement, and each
person who controls the Company within the meaning of either the Act or the Exchange Act, to the
same extent as the foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the Company by or on
behalf of such Underwriter through the Representatives in writing specifically for inclusion in the
documents referred to in the foregoing indemnity. This indemnity agreement will be in addition to
any liability, which any Underwriter may otherwise have. The Company acknowledges that the only
information furnished in writing by or on behalf of the several Underwriters for inclusion in any
Preliminary Prospectus, the Prospectus or any Issuer Free Writing Prospectus is as set forth in
Section 12 hereof.
(c) Promptly after receipt by an indemnified party under this Section 7 of notice of the
commencement of any action, such indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under this Section 7, notify the indemnifying party in writing
of the commencement thereof; but the failure so to notify the indemnifying party: (i) will not
relieve it from liability under paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the indemnifying party
of substantial rights and defenses; and (ii) will not, in any event, relieve the indemnifying party
from any obligations to any indemnified party other than the indemnification obligation provided in
paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint counsel of the
indemnifying party’s choice at the indemnifying party’s expense to represent the indemnified party
in any action for which indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel retained by the
indemnified party or parties except as set forth below); provided, however, that
such counsel shall be satisfactory to the indemnified party. Notwithstanding the indemnifying
party’s election to appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel (including local counsel), and
the indemnifying party shall bear the reasonable fees, costs and expenses of such separate counsel
if: (i) the use of counsel chosen by the indemnifying party to represent the indemnified party
would present such counsel with a conflict of interest; (ii) the actual or potential defendants in,
or targets of, any such action include both the
20
indemnified party and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other indemnified parties which
are different from or additional to those available to the indemnifying party; (iii) the
indemnifying party shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of the institution of such
action; or (iv) the indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise, or consent to the entry of
any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect
of which indemnification or contribution may be sought hereunder (whether or not the indemnified
parties are actual or potential parties to such claim or action), unless such settlement,
compromise or consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or (b) of this Section 7 is
unavailable to, or insufficient to hold harmless, an indemnified party for any reason, the Company
and the Underwriters severally agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection with investigating
or defending the same) (collectively “Losses”) to which the Company and one or more of the
Underwriters may be subject in such proportion as is appropriate to reflect the relative benefits
received by the Company, on the one hand, and by the Underwriters, on the other, from the offering
of the Securities; provided, however, that in no case shall any Underwriter (except
as may be provided in any agreement among the Underwriters relating to the offering of the
Securities) be responsible for any amount in excess of the underwriting discount or commission
applicable to the Securities purchased by the Underwriters hereunder. If the allocation provided
by the immediately preceding sentence is unavailable for any reason, the Company and the
Underwriters severally shall contribute in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault of the Company, on the one hand, and of the
Underwriters, on the other, in connection with the statements or omissions which resulted in such
Losses as well as any other relevant equitable considerations. Benefits received by the Company
shall be deemed to be equal to the total net proceeds from the offering (before deducting expenses)
received by it, and benefits received by the Underwriters shall be deemed to be equal to the total
underwriting discounts and commissions, in each case as set forth on the cover page of the
Prospectus. Relative fault shall be determined by reference to, among other things: (i) whether
any untrue or any alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information provided by the Company, on the one hand, or the
Underwriters, on the other; (ii) the intent of the parties and their relative knowledge; (iii)
access to information; and (iv) the opportunity to correct or prevent such untrue statement or
omission. The Company and the Underwriters agree that it would not be just and equitable if
contribution were determined by pro rata allocation or any other method of allocation which does
not take account of the equitable considerations referred to above. Notwithstanding the provisions
of this paragraph (d), no person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 7, each person who controls an
Underwriter within the meaning of either the Act or the Exchange Act and each director, officer,
employee and agent of an Underwriter shall have the same rights to contribution as the
Underwriters, and each person who controls the Company within the meaning of either the
21
Act or the Exchange Act, each officer of the Company who shall have signed the Registration
Statement and each director of the Company shall have the same rights to contribution as the
Company, subject in each case to the applicable terms and conditions of this paragraph (d).
8. Conditions of Underwriters’ Obligations. The obligations of the Underwriters to
purchase the Securities hereunder are subject to the following conditions:
(a) (i) The Prospectus, and any supplement thereto, have been filed in the manner and within
the time period required by Rule 424(b) (without reference to Rule 424(b)(8)); the final term sheet
contemplated by Section 5(b) hereto and any other material required to be filed by the Company
pursuant to Rule 433(d) shall have been filed with the Commission within the applicable time
periods prescribed for such filings by Rule 433 and (ii) any request of the Commission for
additional information (to be included in the Registration Statement or the Prospectus or
otherwise) shall have been complied with to the satisfaction of the Underwriters.
(b) Subsequent to the Execution Time, or, if earlier, the dates as of which information is
given in the Registration Statement (exclusive of any amendment thereto), the Disclosure Package
and the Prospectus (exclusive of any amendment thereof), there shall not have occurred: (i) any
change, or any development involving a prospective change, in or affecting the condition (financial
or otherwise), earnings, business, properties, net worth, or results of operations of the Company
and its subsidiaries, whether or not arising from transactions in the ordinary course of business,
except as set forth in the Disclosure Package and the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement), the effect of which, in the sole
judgment of the Representatives is so material and adverse as to make it impractical or inadvisable
to proceed with the offering or delivery of the Securities as contemplated by the Registration
Statement (exclusive of any amendments thereto), the Disclosure Package and the Prospectus
(exclusive of any supplement thereto); or (ii) any event or development relating to or involving
the Company and its subsidiaries or any officer or director of the Company and its subsidiaries
which makes any statement made in the Disclosure Package or the Prospectus untrue or which, in the
opinion of the Company and its counsel or the Representatives and their counsel, requires the
making of any addition to or change in the Disclosure Package in order to state a material fact
required by the Act or any other law to be stated therein, or necessary in order to make the
statements therein not misleading, if amending or supplementing the Disclosure Package to reflect
such event or development would, in the opinion of the Representatives, adversely affect the
market for the Securities.
(c) The Representatives shall have received on the Closing Date an opinion of Pillsbury
Xxxxxxxx Xxxx Xxxxxxx LLP, counsel for the Company, dated as of such date and addressed to the
Representatives, to the effect that:
(i) The Company and each of the Significant Subsidiaries: (x) is a
corporation, limited liability company, partnership or trust duly incorporated and
validly existing in good standing under the laws of its state of formation, with
full corporate, partnership or trust power, as applicable, and authority to own,
lease and operate its properties and to conduct its business as described in the
Registration Statement, the Disclosure Package and the Prospectus (and any
22
amendment or supplement thereto); and, (y) based solely on certificates of
public officials and officers of the Company and the Significant Subsidiaries, are
duly registered and qualified to conduct their business; and (z) are in good
standing in each jurisdiction or place where the nature of its properties or the
conduct of its business requires such registration or qualification, except where
the failure so to register or qualify does not have a material adverse effect on the
condition (financial or other), business, properties, net worth or results of
operations of the Company and the Significant Subsidiaries;
(ii) To the knowledge of such counsel, the Company has no subsidiary or
subsidiaries other than as set forth on Schedule III hereto, and does not
control, directly or indirectly, any corporation, partnership, joint venture,
association or other business association. To the knowledge of such counsel, the
subsidiaries that meet the definition of “Significant Subsidiary,” as such term is
defined in Section 210.1-02 of Regulation S-X are set forth on Schedule III
hereto. The issued shares of capital stock of each of the Company’s subsidiaries
have been duly authorized and validly issued, are fully paid and non-assessable and
are owned legally and beneficially by the Company and, to the knowledge of such
counsel, after due inquiry, free and clear of any security interests, liens,
encumbrances, equities or claims;
(iii) The authorized capital stock and debt securities of the Company conform
in all material respects as to legal matters to the description thereof contained
under the captions “Description of Debt Securities,” “Description of Preferred
Stock,” “Description of Depositary Shares,” “Description of Common Stock” and
“Description of Warrants” in the Basic Prospectus and under the caption “Description
of Notes” in the Pricing Prospectus and the Prospectus; and, except as set forth in
the Disclosure Package and the Prospectus, no options, warrants or other rights to
purchase, agreements or other obligations to issue, or rights to convert any
obligations into or exchange any securities for, shares of capital stock of or
ownership interests in the Company are outstanding;
(iv) All the shares of capital stock of the Company outstanding prior to the
issuance of the Securities have been duly authorized and validly issued, and are
fully paid and nonassessable;
(v) The Indenture (including the Eighth Supplemental Indenture thereto) (A) has
been duly authorized, executed and delivered, (B) has been duly qualified under the
Trust Indenture Act, and (C) constitutes a legal, valid and binding instrument
enforceable against the Company in accordance with its terms (subject, as to
enforcement of remedies, to applicable bankruptcy, reorganization, insolvency,
moratorium or other laws affecting creditors’ rights generally from time to time in
effect and to general principles of equity, including, without limitation, concepts
of materiality, reasonableness, good faith and fair dealing, regardless of whether
considered in a proceeding in equity or at law);
23
(vi) The Securities have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and delivered to
and paid for by the Underwriters pursuant to this Agreement, will constitute legal,
valid and binding obligations of the Company entitled to the benefits of the
Indenture; the Securities conform in all material respects as to legal matters to
the description thereof contained under the caption “Description of Debt Securities”
in the Basic Prospectus and under the caption “Description of Notes” in the Pricing
Prospectus and the Prospectus;
(vii) The holders of outstanding shares of capital stock of the Company are not
entitled to statutory preemptive or other statutory rights to subscribe for the
Securities; and, except as set forth in the Disclosure Package and the Prospectus,
to the knowledge of such counsel, no options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert any obligations into
or exchange any securities for, shares of capital stock of or ownership interests in
the Company are outstanding;
(viii) To the knowledge of such counsel, no holder of securities of the Company
is entitled to have such securities registered under the Registration Statement
which right has not been waived in connection with the transactions contemplated by
this Agreement;
(ix) The form of certificate for the Securities conforms to the requirements of
the Indenture and Maryland General Corporation Law, if any;
(x) The Registration Statement has become effective under the Act; any required
filing of the Basic Prospectus, any Preliminary Prospectus or the Prospectus, and
any supplements thereto, pursuant to Rule 424(b) or any required filing of an Issuer
Free Writing Prospectus has been made in the manner and within the time period
required by Rule 424(b) and Rule 433, respectively; to the knowledge of such
counsel, no stop order suspending the effectiveness of the Registration Statement
has been issued, no proceedings for that purpose have been instituted or threatened;
(xi) The Company has the corporate power and authority to enter into this
Agreement and the Indenture and to issue, sell and deliver the Securities to the
Underwriters as provided herein. This Agreement has been duly authorized, executed
and delivered by the Company. The Agreement is a valid, legal and binding agreement
of the Company, enforceable against the Company in accordance with its terms, except
as enforcement of rights to indemnity and contribution hereunder may be limited by
Federal or state securities laws or principles of public policy and subject to the
qualification that the enforceability of the Company’s obligations thereunder may be
limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors’ rights generally, and
by general equitable principles when applied by a court of law or equity;
24
(xii) To the knowledge of such counsel, neither the Company nor any of its
subsidiaries is: (A) in violation of its respective articles of incorporation,
by-laws or other organizational documents; or (B) in default in the performance of
any material obligation, agreement or condition contained in any bond, debenture,
note or other evidence of indebtedness set forth on Schedule A attached to such
opinion, except as disclosed in the Prospectus;
(xiii) Neither the issue, offer, sale or delivery of the Securities, the
execution, delivery or performance by the Company of this Agreement or the Indenture
(including the Eighth Supplemental Indenture thereto), compliance by the Company
with the provisions hereof or thereof nor consummation by the Company of the
transactions contemplated hereby or thereby (including the application of the
proceeds from the sale of the Securities): (A) conflicts or will conflict with or
constitutes or will constitute or result in a breach of, or a default under, (1) the
articles of incorporation, by-laws or other organizational documents of the Company
or any of the Significant Subsidiaries or (2) any material agreement, indenture,
lease or other instrument to which the Company or any of its subsidiaries is a party
or by which the Company or any properties of the Company or any of its subsidiaries
is bound (other than any financial covenants contained therein as to which such
counsel needs express no opinion) (x) that is set forth on Schedule IV
hereto (the “Material Agreements”) or (y) which is otherwise known to such counsel;
or (B) results or will result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or its subsidiaries, pursuant
to any of the Material Agreements; or (C) violates or will violate any statute, law,
rule or regulation of the United States of America, the State of Maryland or the
State of New York, or judgment, order or decree applicable to the Company or any of
its subsidiaries of any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over the Company or any of
its subsidiaries or any of its or their properties;
(xiv) No consent, approval, authorization or other order of, or registration or
filing with, any court, regulatory body, administrative agency or other governmental
body, agency, or official is required on the part of the Company (except as have
been obtained under the Act or such as may be required under state securities or
blue sky laws governing the purchase and distribution of the Securities) for the
valid issuance and sale of the Securities to the Underwriters as contemplated by
this Agreement;
(xv) (A) The Registration Statement, the Preliminary Prospectus and the
Prospectus, and any supplements or amendments thereto (except for the financial
statements and the notes thereto and the schedules and other financial and
statistical data included therein and the Statement of Eligibility and Qualification
(Form T-1) under the Trust Indenture Act of the Trustee, as to which such counsel
need not express any opinion), comply as to form in all material respects with the
requirements of the Act and the Trust Indenture Act; and (B) each of the
Incorporated Documents (except for the financial statements
25
and the notes thereto and the schedules and other financial and statistical
data included therein, as to which counsel need not express any opinion) complies as
to form in all material respects with the Exchange Act and the rules and regulations
of the Commission thereunder;
(xvi) To the knowledge of such counsel, there is no action, suit or proceeding
pending or threatened by or before any court or governmental agency, authority or
body or any arbitrator involving the Company or any of its subsidiaries or any of
its or their property of a character required to be described in the Registration
Statement or Prospectus (or any amendment or supplement thereto), and there are no
agreements, contracts, indentures, leases or other instruments or documents that are
required to be described in the Registration Statement or the Prospectus (or any
amendment or supplement thereto) or to be filed or incorporated by reference as an
exhibit to the Registration Statement or any Incorporated Document that are not
described, filed or incorporated as required, as the case may be;
(xvii) Such counsel is not aware of any certificates, authorizations, licenses
or permits required by any federal regulatory authority which are necessary for the
Company and/or its subsidiaries to conduct their respective businesses other than
any such certificates, authorizations, licenses or permits which have been obtained
or where such failure to possess such certificates, authorizations, licenses or
permits could not reasonably be expected to have a Material Adverse Effect. To the
knowledge of such counsel, neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or modification of any
certificate, authorization, license or permit issued by any federal, state,
municipal or foreign regulatory authority which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in a Material
Adverse Effect;
(xviii) The Company is not subject to registration as an investment company
under the Investment Company Act of 1940, as amended, and the transactions
contemplated by this Agreement (including the application of the proceeds from the
sale of the Securities), will not cause the Company to become an investment company
subject to registration under the Investment Company Act of 1940, as amended;
(xix) The Company was a “real estate investment trust” as defined by Section
856(a) of the Code for its taxable years ended December 31, 1984 through December
31, 2006, and its current and proposed method of operation and ownership will enable
it to meet the requirements for qualification and taxation as a REIT under the Code
for its taxable year ending December 31, 2007 and for all future taxable years; and
the statements in the Basic Prospectus set forth under the caption “Federal Income
Tax Considerations” and in the Pricing Prospectus and the Prospectus Supplement
under the caption “Certain Federal Income Tax Considerations,” insofar as they
purport to describe or summarize certain provisions of the agreements, statutes or
regulations referred to therein, are
26
accurate descriptions or summaries in all material respects, and the discussion
thereunder expresses the opinion of Pillsbury Xxxxxxxx Xxxx Xxxxxxx LLP insofar as
it relates to matters of United States federal income tax law and legal conclusions
with regard to those matters;
(xx) The statements in the Disclosure Package and the Prospectus, insofar as
they are descriptions of contracts or agreements or constitute statements of law or
legal conclusions, are accurate and present fairly the information required to be
shown in all material respects; and
(xxi) Although counsel has not undertaken, except as otherwise indicated in its
opinion, to determine independently, and does not assume any responsibility for, the
accuracy or completeness of the statements in the Registration Statement, such
counsel has participated in the preparation of the Registration Statement, the
Disclosure Package and the Prospectus, including review and discussion of the
contents thereof (including review and discussion of the contents of all
Incorporated Documents), and nothing has come to the attention of such counsel that
has caused it to believe that the Registration Statement (including the Incorporated
Documents), at the time the Registration Statement became effective, or the
Disclosure Package, at the Execution Time and as of the date of such opinion, or the
Prospectus, as of its date and as of the Closing Date contained an untrue statement
of a material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or that any amendment or
supplement to the Prospectus, as of its respective date, and as of the date of such
opinion contained any untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (it being understood that
such counsel need express no opinion with respect to the financial statements and
the notes thereto and the schedules and other financial data included in the
Registration Statement or the Prospectus or any Incorporated Document).
(d) The Representatives shall have received on the Closing Date an opinion of Hunton &
Xxxxxxxx LLP, counsel for the Underwriters, dated as of such date and addressed to the
Representatives with respect to such matters as the Underwriters may request.
(e) The Representatives shall have received letters addressed to the Underwriters and dated as
of the date hereof and as of the Closing Date from each of KPMG LLP and Ernst & Young LLP,
independent registered public accounting firms, substantially in the form heretofore approved by
the Underwriters; provided that the letter delivered on the Closing Date shall use a
“cut-off” date no more than three (3) Business Days prior to the Closing Date, as the case may be.
(f) (A) No stop order suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been taken or, to the knowledge of the
Company, shall be contemplated by the Commission at or prior to the Closing Date; (B) there shall
not have been any change in the capital stock of the Company nor
27
any material increase in the short-term or long-term debt (including any off-balance sheet
activities or transactions) of the Company and its subsidiaries (other than in the ordinary course
of business) from that set forth or contemplated in the Registration Statement, the Disclosure
Package or the Prospectus (or any amendment or supplement thereto); (C) there shall not have been,
since the respective dates as of which information is given in the Registration Statement, the
Disclosure Package and the Prospectus (or any amendment or supplement thereto), except as may
otherwise be stated in the Registration Statement, the Disclosure Package and Prospectus (or any
amendment or supplement thereto), any material adverse change in the condition (financial or
other), business, prospects, properties, net worth or results of operations of the Company or its
subsidiaries; (D) the Company and its subsidiaries shall not have any liabilities or obligations
(financial or other), direct or contingent (whether or not in the ordinary course of business),
that are material to the Company or its subsidiaries, other than those reflected in the
Registration Statement or the Disclosure Package and the Prospectus (or any amendment or supplement
thereto); and (E) all the representations and warranties of the Company contained in this Agreement
shall be true and correct at and as of the Execution Time and on and as of the Closing Date as if
made at and as of such time or on and as of such date, and the Representatives shall have received
a certificate, dated the Closing Date and signed by either the chief executive officer or chief
operating officer and the chief financial officer of the Company (or such other officers as are
acceptable to the Representatives), to the effect set forth in this Section 8(g) and in Section
8(h) hereof.
(g) The Company shall not have failed at or prior to the Closing Date to have performed or
complied with any of its agreements herein contained and required to be performed or complied with
by it hereunder or under the Indenture, at or prior to the Closing Date.
(h) Subsequent to the Execution Time, there shall not have been any decrease in the rating of
any of the Company’s debt securities by any “nationally recognized statistical rating organization”
(as defined for purposes of Rule 436(g) under the Act) or any notice given of any intended or
potential decrease in any such rating or of a possible change in any such rating that does not
indicate the direction of the possible change.
(i) The Company shall have furnished or caused to be furnished to the Representatives such
further certificates and documents as the Representatives shall have requested.
All such opinions, certificates, letters and other documents will be in compliance with the
provisions hereof only if they are satisfactory in form and substance to the Representatives and
their counsel.
Any certificate or document signed by any officer of the Company and delivered to the
Underwriters, or to counsel for the Underwriters, shall be deemed a representation and warranty by
the Company to the Underwriters as to the statements made therein.
If any of the conditions specified in this Section 8 shall not have been fulfilled in all
material respects when and as provided in this Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not be in all material respects
reasonably satisfactory in form and substance to the Representatives and counsel for the
28
Underwriters, this Agreement and all obligations of the Underwriters hereunder may be canceled
by the Representatives at, or at any time prior to, the Closing Date. Notice of such cancellation
shall be given to the Company in writing or by telephone or facsimile confirmed in writing.
With respect to the Closing Date, the documents required to be delivered by this Section 8
shall be delivered at the offices of Hunton & Xxxxxxxx LLP, Attn: Xxxxxx X. Xxxxxx, Esq., counsel
for the Underwriters, at 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxx, Xxxxx Xxxxxxxx on or prior
to such date.
9. Expenses. The Company agrees to pay the following costs and expenses and all other
costs and expenses incident to the performance by the Company of its obligations hereunder: (i)
the preparation, printing or reproduction, and filing with the Commission of the registration
statement (including financial statements and exhibits thereto), each Preliminary Prospectus, if
any, the Prospectus, each Issuer Free Writing Prospectus and each amendment or supplement to any of
them; (ii) the printing (or reproduction) and delivery (including postage, air freight charges and
charges for counting and packaging) of such copies of the registration statement, each Preliminary
Prospectus, the Prospectus, each Issuer Free Writing Prospectus , the Incorporated Documents, and
all amendments or supplements to any of them, as may be reasonably requested for use in connection
with the offering and sale of the Securities; (iii) the preparation, printing, authentication,
issuance and delivery of certificates for the Securities, including any stamp or other taxes in
connection with the original issuance and sale of the Securities; (iv) the printing (or
reproduction) and delivery of this Agreement, the preliminary and supplemental blue sky memoranda
and all other agreements or documents printed (or reproduced) and delivered in connection with the
offering of the Securities; (v) the registration or qualification of the Securities for offer and
sale under the securities or blue sky laws of the several states as provided in Section 5(g) hereof
(including the reasonable fees, expenses and disbursements of counsel for the Underwriters relating
to the preparation, printing or reproduction, and delivery of the preliminary and supplemental blue
sky memoranda and such registration and qualification); (vi) the filing fees and the fees and
expenses of counsel for the Underwriters in connection with any filings required to be made with
the Financial Industry Regulatory Authority, Inc.; (vii) the transportation and other expenses
incurred by or on behalf of Company representatives in connection with presentations to prospective
purchasers of the Securities; (viii) the fees and expenses of the Company’s accountants and counsel
(including local and special counsel) for the Company; and (ix) the fees and expenses of the
Trustee in connection with the offering and sale of the Securities.
10. Default by an Underwriter. If any one or more Underwriters shall fail to purchase
and pay for any of the Securities agreed to be purchased by such Underwriter or Underwriters
hereunder and such failure to purchase shall constitute a default in the performance of its or
their obligations under this Agreement, the remaining Underwriters shall be obligated severally to
take up and pay for (in the respective proportions which the principal amount of Securities set
forth opposite their names in Schedule I hereto bears to the aggregate principal amount of
Securities set forth opposite the names of all the remaining Underwriters) the Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase; provided,
however, that in the event that the aggregate principal amount of Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of the
aggregate principal amount of Securities set forth in Schedule I hereto, the remaining
Underwriters shall
29
have the right to purchase all, but shall not be under any obligation to purchase any, of the
Securities, and if such nondefaulting Underwriters do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting Underwriter or the Company. In the
event of a default by any Underwriter as set forth in this Section 10, the Closing Date shall be
postponed for such period, not exceeding five (5) Business Days, as the Representatives shall
determine in order that the required changes in the Registration Statement and the Prospectus or in
any other documents or arrangements may be effected. Nothing contained in this Agreement shall
relieve any defaulting Underwriter of its liability, if any, to the Company and any nondefaulting
Underwriter for damages occasioned by its default hereunder.
11. Termination of Agreement. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, without liability on the part of the Underwriters to
the Company, by notice to the Company, if, prior to the Closing Date: (i) there shall have
occurred any change, or any development involving a prospective change, in or affecting the
condition (financial or otherwise), earnings, business, properties, net worth, or results of
operations of the Company and its subsidiaries, whether or not arising from transactions in the
ordinary course of business, except as set forth in the Disclosure Package, the effect of which, in
the sole judgment of the Representatives, is so material and adverse as to make it impractical or
inadvisable to proceed with the offering or delivery of the Securities as contemplated by the
Registration Statement (exclusive of any amendments thereto) and the Prospectus (exclusive of any
supplement thereto); (ii) there shall have occurred any downgrading in the rating of any debt
securities or preferred stock of the Company by any “nationally recognized statistical rating
organization” (as defined for purposes of Rule 436(g) under the Act), or any public announcement
that any such organization has under surveillance or review its rating of any debt securities or
preferred stock of the Company (other than an announcement with positive implications of a possible
upgrading, and no implication of a possible downgrading, of such rating); (iii) trading in the
Company’s Common Shares shall have been suspended by the Commission or the New York Stock Exchange
or trading in securities generally on the New York Stock Exchange, the American Stock Exchange or
the Nasdaq National Market shall have been suspended or materially limited; (iv) a general
moratorium on commercial banking activities in New York or Florida shall have been declared by
either federal or state authorities; (v) the Company or any of its subsidiaries shall have
sustained a substantial loss by fire, flood, accident or other calamity which renders it
impracticable, in the reasonable judgment of the Representatives, to consummate the sale of the
Securities and the delivery of the Securities by the Underwriters at the initial public offering
price; or (vi) there shall have occurred any outbreak or escalation of hostilities or other
international or domestic calamity, crisis or change in political, financial or economic
conditions, the effect of which on the financial markets of the United States is such as to make
it, in the sole judgment of the Representatives, impracticable or inadvisable to commence or
continue the offering as contemplated by the Registration Statement (exclusive of any amendments
thereto) and the Prospectus (exclusive of any supplement thereto). Notice of such termination may
be given to the Company by telegram, telecopy or telephone and shall be subsequently confirmed by
letter.
12. Information Furnished by the Underwriters. The statements in the fourth, seventh,
eighth, ninth and fourteenth paragraphs under the heading “Underwriting” in any Preliminary
Prospectus and in the Prospectus Supplement, constitute the only information
30
furnished by or on behalf of the Underwriters as such information is referred to in clause
(ii) of the last sentence of Section 6(b)) and the last sentence of Section 7(b) hereof.
13. Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company or its officers and of
the Underwriters set forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of the Underwriters or the Company or
any of the officers, directors, employees, agents or controlling persons referred to in Section 7
hereof, and will survive delivery of and payment for the Securities. The provisions of Sections
5(k), 7 and 9 hereof shall survive the termination or cancellation of this Agreement.
14. Absence of Fiduciary Relationship. The Company acknowledges and agrees that:
(a) the Underwriters have been retained solely to act as underwriters in connection with the
sale of the Securities and that no fiduciary, advisory or agency relationship between the Company
and the Underwriters has been created in respect of any of the transactions contemplated by this
Agreement or the process leading thereto, irrespective of whether any of the Underwriters has
advised or is advising the Company on other matters;
(b) the price of the Securities set forth in this Agreement was established by the Company
following discussions and arms-length negotiations with the Representatives, and the Company is
capable of evaluating and understanding and understands and accepts the terms, risks and conditions
of the transactions contemplated by this Agreement;
(c) it has been advised that the Underwriters and their affiliates are engaged in a broad
range of transactions which may involve interests that differ from those of the Company and that
the Underwriters have no obligation to disclose such interests and transactions to the Company by
virtue of any fiduciary, advisory or agency relationship; and
(d) it waives, to the fullest extent permitted by law, any claims they may have against the
Underwriters for breach of fiduciary duty or alleged breach of fiduciary duty.
15. Notices. All communications hereunder will be in writing and effective only on
receipt, and, if sent to the Representatives, will be mailed, delivered or telefaxed to Banc of
America Securities LLC, 00 Xxxx 00xx Xxxxxx, XX0-000-00-00, Xxx Xxxx, Xxx Xxxx 00000
(facsimile 646-313-4823), Attention: High Grade Transaction Management/Legal and to Wachovia
Capital Markets, LLC, One Wachovia Center, 000 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000,
(facsimile 704-383-9519), Attention: Transaction Management Group; or, if sent to the Company, will
be mailed, delivered or telefaxed to the office of the Company at 000 Xxxxx Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxx, Xxxxxxx 00000, (fax no.: 000-000-0000), Attention: Xxxxx X. Xxxxxxx, Executive Vice
President and Chief Financial Officer.
16. Successors. This Agreement has been made solely for the benefit of the
Underwriters, the Company, its directors and officers, and the other controlling persons referred
to in Section 7 hereof and their respective successors and assigns, to the extent provided herein.
This Agreement will inure to the benefit of and be binding upon the parties hereto and their
respective successors and the officers and directors and controlling persons referred to in Section
7 hereof, and no other person shall acquire or have any right under or by virtue of this
31
Agreement. Neither the term “successor” nor the term “successors and assigns” as used in this
Agreement shall include a purchaser from the Underwriters of any of the Securities in his status as
such purchaser.
17. Integration. This Agreement supersedes all prior agreements and understandings
(whether written or oral) between the Company and the Underwriters, or any of them, with respect to
the subject matter hereof.
18. Applicable Law. This Agreement will be governed by and construed in accordance
with the laws of the State of New York applicable to contracts made and to be performed within the
State of New York.
19. Waiver of Jury Trial. The Company hereby irrevocably waives, to the fullest
extent permitted by applicable law, any and all right to trial by jury in any legal proceeding
arising out of or relating to this Agreement or the transactions contemplated hereby.
20. Counterparts. This Agreement may be signed in one or more counterparts, each of
which shall constitute an original, and all of which together shall constitute one and the same
agreement.
21. Headings. The section headings used herein are for convenience only and shall not
affect the construction hereof.
22. Definition. The term which follows, when used in this Agreement, shall have the
meaning indicated.
“Business Day” shall mean any day other than a Saturday, a Sunday or a legal holiday or a day
on which banking institutions or trust companies are authorized or obligated by law to close in New
York City.
“Free Writing Prospectus” shall mean a free writing prospectus, as defined in Rule 405.
“Rule 158,” “Rule 163,” “Rule 164,” “Rule 172,” “Rule 405,” “Rule 415,” “Rule 424,” “Rule 433”
and “Rule 456” refer to such rules under the Act.
“Well-Known Seasoned Issuer” shall mean a well-known seasoned issuer, as defined in Rule 405.
[Signature page follows.]
32
If the foregoing is in accordance with your understanding of our agreement, please sign
and return to us the enclosed duplicate hereof, whereupon this letter and your acceptance shall
represent a binding agreement among the Company and the several Underwriters.
Very truly yours, NATIONAL RETAIL PROPERTIES, INC. |
||||
By: | /s/ Xxxxx X. Xxxxxxx | |||
Name: | Xxxxx X. Xxxxxxx | |||
Title: | Executive Vice President and Chief Financial Officer | |||
Accepted and agreed to as of the date first above written: BANC OF AMERICA SECURITIES LLC |
||||
By: | /s/ Xxxx Xxxxx | |||
Name: | Xxxx Xxxxx | |||
Title: | Principal | |||
WACHOVIA CAPITAL MARKETS, LLC |
||||
By: | /s/ Xxxxxx Xxx | |||
Name: | Xxxxxx Xxx | |||
Title: | Managing Director | |||
Each for itself and as a Representative of the other Underwriters named on Schedule I hereto. |
[Signature Page to Underwriting Agreement for Notes due 2017]
SCHEDULE I
Principal Amount of | ||||
Underwriters | Securities to be Purchased | |||
Banc of America Securities LLC |
$ | 88,750,000 | ||
Wachovia Capital Markets, LLC |
88,750,000 | |||
Credit Suisse Securities (USA) LLC |
17,500,000 | |||
SunTrust Xxxxxxxx Xxxxxxxx, Inc. |
9,375,000 | |||
Xxxxx Fargo Securities, LLC |
9,375,000 | |||
BB&T Capital Markets, a division of Xxxxx &
Xxxxxxxxxxxx, Inc. |
7,500,000 | |||
Comerica Securities, Inc. |
7,500,000 | |||
Xxxxxx, Xxxxx Xxxxx, Incorporated |
7,500,000 | |||
PNC Capital Markets LLC |
7,500,000 | |||
Fifth Third Securities, Inc. |
6,250,000 | |||
Total |
$ | 250,000,000 | ||
SCHEDULE II
FREE WRITING PROSPECTUSES INCLUDED IN THE DISCLOSURE PACKAGE
1) | Final Term Sheet, in the form attached as Exhibit A hereto |
SCHEDULE III
LIST OF SUBSIDIARIES
Name of Subsidiary | Name of Subsidiary | |
Net Lease Realty I, Inc.
|
CNLRS Equity Ventures, Inc. | |
Net Lease Realty III, Inc.
|
NNN Equity Ventures, Inc. | |
NNN Ster Florida, LLC
|
Net Lease Realty VI, LLC | |
NNN Ster Texas LP
|
WG Grand Prairie TX, LLC | |
Net Lease Funding, Inc.
|
NNN BJ’s Orlando FL, LLC | |
National Retail Properties Trust
|
NNN RAD Monticello NY, LLC | |
National Retail Properties, LP
|
CNLRS Acquisitions, Inc. | |
NNN GP Corp.
|
CNLRS Bismark ND, LLC | |
NNN LP Corp.
|
CNLRS WG Long Beach MS, LLC | |
CNLR Texas GP Corp.
|
CNLRS Yosemite Park CO, LLC | |
NNN TRS, Inc.
|
Gator Xxxxxxx, LLC | |
NNN Acquisitions, Inc.
|
Net Lease Institutional Realty, LP | |
NNN Development, Inc.
|
NNN Brokerage Services, Inc. | |
Orange Avenue Mortgage Investments, Inc.
|
CNLRS RGI Xxxxxx Springs, LLC | |
CNL SBA License, Inc.
|
CNLRS BEP, L.P. | |
CNL Commercial Mortgage Funding, Inc.
|
CNLRS Rockwall, L.P. | |
NAPE Acquisition, Inc.
|
CNLRS Equity Ventures BEP, Inc. | |
CCMH I, LLC
|
CNLRS Equity Ventures Rockwall, Inc. | |
CCMH II, LLC
|
NNN Equity Ventures Xxxxxxxx Crossing, Inc. | |
CCMH III, LLC
|
CNLRS P&P, L.P. | |
CCMH IV, LLC
|
NNN Xxxxxxxx Crossing, L.P. | |
CCMH V, LLC
|
NNN Retail MCW Portfolio I, LLC | |
CCMH VI, LLC
|
NNN Retail Amazing Aurora, LLC | |
CNLRS Equity Ventures Plano, Inc.
|
NNN Retail All Star Wichita, LLC | |
NNN Ster Paradise Valley Arizona, LLC
|
NNN Retail Magic Mountain Columbus, LLC | |
NNN Retail Sonic Charlotte, LLC | ||
NNN Retail FF Mabank, LLC |
Significant Subsidiaries | ||
National Retail Properties, LP
|
||
NNN TRS, Inc. |
SCHEDULE IV
MATERIAL AGREEMENTS
Indenture by and between the Company and U.S. Bank National Association, successor to Wachovia
Bank, National Association (f/k/a First Union National Bank), as trustee, dated as of March 25,
1998.
Supplemental Indenture No. 1 by and between the Company and U.S. Bank National Association,
successor to Wachovia Bank, National Association (f/k/a First Union National Bank), as trustee,
dated as of March 25, 1998.
Supplemental Indenture No. 2 by and between the Company and U.S. Bank National Association,
successor to Wachovia Bank, National Association (f/k/a First Union National Bank), as trustee,
dated as of June 21, 1999.
Supplemental Indenture No. 3 by and between the Company and U.S. Bank National Association,
successor to Wachovia Bank, National Association (f/k/a First Union National Bank), as trustee,
dated as of September 20, 2000.
Supplemental Indenture No. 4 by and between the Company and U.S. Bank National Association,
successor to Wachovia Bank, National Association, as trustee, dated as of May 30, 2002.
Supplemental Indenture No. 5 by and between the Company and U.S. Bank National Association,
successor to Wachovia Bank, National Association, as trustee, dated as of June 18, 2004.
Supplemental Indenture No. 6 by and between the Company and U.S. Bank National Association,
successor to Wachovia Bank, National Association, as trustee, dated as of November 17, 2005.
Supplemental Indenture No. 7 by and between the Company and U.S. Bank, National Association,
successor to Wachovia Bank, National Association, as trustee, dated as of September 13, 2006.
Eighth Amended and Restated Line of Credit and Security Agreement, dated December 13, 2005, by
and among the Company, certain lenders and Wachovia Bank, National Association, as the Agent,
relating to a $300,000,000 loan.
First Amendment to Eighth Amended and Restated Line of Credit and Security Agreement, dated
February 20, 2007, by and among the Company, certain lenders and Wachovia Bank, National
Association, as the Agent.
Form of Lease Agreement, between an affiliate of the Company, as landlord and SSP Partners, as
tenant.
EXHIBIT A
FINAL TERM SHEET
Filed Pursuant to Rule 433
Issuer Free Writing Prospectus
dated September 4, 2007
Registration No. 333-132095
Issuer Free Writing Prospectus
dated September 4, 2007
Registration No. 333-132095
Pricing Term Sheet
Size:
|
$250,000,000 | |
Coupon (Interest Rate):
|
6.875% per annum | |
Security:
|
6.875% Notes due 2017 | |
Interest Payment Dates:
|
April 15 and October 15, commencing April 15, 2008 | |
Maturity:
|
October 15, 2017 | |
Price to Public:
|
99.649% of principal amount, plus accrued interest, if any, from the date of original issuance | |
Trade Date:
|
September 4, 2007 | |
Settlement Date:
|
T+4; September 10, 2007 | |
Net Proceeds:
|
$247,497,500 (before expenses associated with the transaction) | |
Redemption Provision:
|
Make-whole call at any time based on the applicable Constant Maturity Treasury yield plus 0.40% (forty one-hundredths of one percent) | |
Yield to maturity:
|
6.922% | |
Spread to Benchmark Treasury:
|
237.5 basis points | |
Benchmark Treasury:
|
U.S. Treasury 4.75% due August 2017 | |
Benchmark Treasury Price and Yield:
|
101-19+; 4.547% | |
Expected Ratings
(Xxxxx’x/S&P/Fitch):
|
Baa3 (positive) / BBB- (stable) / BBB- (positive) | |
CUSIP:
|
000000XX0 |
Joint Book-Running Managers: |
Banc of America Securities LLC | $ | 88,750,000 | |||
Wachovia Capital Markets, LLC | $ | 88,750,000 | ||||
Co-Managers: |
Credit Suisse Securities (USA ) LLC | $ | 17,500,000 | |||
SunTrust Xxxxxxxx Xxxxxxxx, Inc. | $ | 9,375,000 | ||||
Xxxxx Fargo Securities, LLC | $ | 9,375,000 | ||||
BB&T Capital Markets, a division of Xxxxx & Xxxxxxxxxxxx, Inc. | $ | 7,500,000 | ||||
Comerica Securities, Inc. | $ | 7,500,000 | ||||
Xxxxxx, Xxxxx Xxxxx, Incorporated | $ | 7,500,000 | ||||
PNC Capital Markets LLC | $ | 7,500,000 | ||||
Fifth Third Securities, Inc. | $ | 6,250,000 |
The issuer has filed a registration statement (including a prospectus) with the Securities and
Exchange Commission, or SEC, for the offering to which this communication relates. Before you
invest, you should read the prospectus in that registration statement, the prospectus supplement
and other documents the issuer has filed with the SEC for more complete information about the
issuer and this offering. You may get these documents for free by visiting XXXXX on the SEC Web
site at xxx.xxx.xxx. Alternatively, the issuer or any underwriter participating in the
offering will arrange to send you the prospectus supplement and accompanying prospectus if you
request it by contacting Banc of America Securities LLC by telephone at (000) 000-0000 (toll-free)
or by e-mail at xx.xxxxxxxxxx_xxxxxxxxxxxx@xxxxxxxxxxxxxx.xxx or by contacting Wachovia Capital
Markets, LLC by telephone (000) 000-0000 (toll-free) or by e-mail at xxxxxxxxx.xxx@xxxxxxxx.xxx.
Any disclaimers or other notices that may appear below are not applicable to this communication and
should be disregarded. Such disclaimers or other notices were automatically generated as a result
of this communication being sent via Bloomberg or another e-mail system.