XXXX-XXXX REALTY CORPORATION
UNDERWRITING AGREEMENT
May 27, 1998
To the Representatives named in Schedule 1 hereto of the
several Underwriters named in Schedule 2 hereto
Ladies and Gentlemen:
Xxxx-Xxxx Realty Corporation, a Maryland corporation qualified as a
real estate investment trust (the "Company"), hereby confirms its agreement with
the several underwriters named in Schedule 2 hereto (the "Underwriters"), for
whom you have been duly authorized to act as representatives (in such
capacities, the "Representatives"), as set forth below. If you are the only
Underwriter, all references herein to the Representatives and the Underwriters
shall be deemed to be to the Underwriter.
The Underwriter intends to deposit the Shares with the trustee of
PaineWebber Equity Trust REIT Series I (A Unit Investment Trust) (the "Trust"),
a registered unit investment trust under the Investment Company Act of 1940, as
amended, for which PaineWebber Incorporated acts as sponsor and depositor, in
exchange for units in the Trust.
1. Securities. Subject to the terms and conditions herein contained,
the Company proposes to issue and sell to the several Underwriters certain
securities of the Company identified in Schedule 1 hereto (the "Securities").
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, each of the several Underwriters
that:
(a) The Company meets the requirements for use of Form S-3
under the Securities Act of 1933, as amended (the "Act"). A registration
statement (the file number of which is set forth in Schedule 1 hereto) on such
Form with respect to the Securities, including a basic prospectus, has been
filed by the Company with the Securities and Exchange Commission (the
"Commission") under the Act, and one or more amendments to such registration
statement
may also have been so filed. Such registration statement, as so amended, has
been declared by the Commission to be effective under the Act and no stop order
suspending the effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no proceedings for
that purpose have been instituted or are pending or, to the knowledge of the
Company, are contemplated by the Commission, and any request on the part of the
Commission for additional information has been complied with. Such registration
statement, as amended at the date of this Agreement as specified in Schedule 1
hereto, meets the requirements set forth in Rule 415(a)(1)(x) under the Act and
complies in all other material respects with said Rule. The Company will next
file with the Commission either (A) if the Company relies on Rule 434 under the
Act, a Term Sheet (as hereinafter defined) relating to the Securities, that
shall identify the Preliminary Prospectus (as hereinafter defined) that it
supplements and, if required to be filed pursuant to Rules 434(c)(2) and 424(b),
an Integrated Prospectus (as hereinafter defined), in either case, containing
such information as is required or permitted by Rules 434, 430A, and 424(b)
under the Act or (B) if the Company does not rely on Rule 434 under the Act,
pursuant to Rule 424(b) under the Act a final prospectus supplement to the basic
prospectus included in such registration statement, as so amended, describing
the Securities and the offering thereof, in such form as has been provided to,
or discussed with, and approved by the Representatives as provided in section
4(a) of this Agreement. As used in this Agreement, the term "Registration
Statement" means such registration statement, as amended at the time when it was
declared effective, including (i) all financial schedules and exhibits thereto,
(ii) all documents incorporated by reference or deemed to be incorporated by
reference therein and (iii) any information omitted therefrom pursuant to Rule
430A under the Act and included in the Prospectus (as hereinafter defined) or,
if required to be filed pursuant to Rules 434(c)(2) and 424(b), in the
Integrated Prospectus; the term "Basic Prospectus" means the prospectus included
in the Registration Statement; the term "Preliminary Prospectus" means any
preliminary form of the Prospectus (as defined herein) specifically relating to
the Securities, in the form first filed with, or transmitted for filing to, the
Commission pursuant to Rule 424 of the Rules and Regulations; the term
"Prospectus Supplement" means any prospectus supplement specifically relating to
the Securities, in the form first filed with, or transmitted for filing to, the
Commission pursuant to Rule 424 under the Securities Act; the term "Prospectus"
means: (A) if the Company relies on Rule 434 under the Act, the Term Sheet
relating to the Securities that is first filed pursuant to Rule 424(b)(7) under
the Act, together with the Preliminary Prospectus identified therein that such
Term Sheet supplements; (B) if the Company does not rely on Rule 434 under the
Act, the Preliminary Prospectus; or (C) if the Company does not rely on Rule 434
under the Act and if no prospectus is required to be filed pursuant to Rule 424
under the Act, the Basic Prospectus, including, in each case, the Prospectus
Supplement; "Basic Prospectus," "Prospectus," "Preliminary Prospectus" and
"Prospectus Supplement" shall include in each case the documents, if any, filed
by the Company with the Commission pursuant to the United States Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and incorporated by
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reference therein; the term "Integrated Prospectus" means a prospectus first
filed with the Commission pursuant to Rules 434(c)(2) and 424(b) under the Act;
and the term "Term Sheet" means any abbreviated term sheet that satisfies the
requirements of Rule 434 under the Act. Any reference in this Agreement to an
"amendment" or "supplement" to any Preliminary Prospectus, the Prospectus, or
any Integrated Prospectus or an "amendment" to any registration statement
(including the Registration Statement) shall be deemed to include any document
incorporated by reference therein that is filed with the Commission under the
Exchange Act after the date of such Preliminary Prospectus, Prospectus,
Integrated Prospectus or registration statement, as the case may be. For
purposes of the preceding sentence, any reference to the "effective date" of an
amendment to a registration statement shall, if such amendment is effected by
means of the filing with the Commission under the Exchange Act of a document
incorporated by reference in such registration statement, be deemed to refer to
the date on which such document was so filed with the Commission; any reference
herein to the "date" of a Prospectus that includes a Term Sheet shall mean the
date of such Term Sheet.
(b) The Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus. When any Preliminary
Prospectus was filed with the Commission it (i) contained all statements
required to be stated therein in accordance with, and complied in all material
respects with the requirements of, the Act, the Exchange Act and the respective
rules and regulations of the Commission thereunder and (ii) did not include 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. When the Registration Statement or any
amendment thereto was or is declared effective, it (i) contained or will contain
all statements required to be stated therein in accordance with, and complied or
will comply in all material respects with the requirements of, the Act, the
Exchange Act and the respective rules and regulations of the Commission
thereunder and (ii) did not or will not include any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein not misleading. When the Prospectus or any Term Sheet that is
a part thereof or any Integrated Prospectus or any amendment or supplement to
the Prospectus is filed with the Commission pursuant to Rule 424(b), on the date
when the Prospectus is otherwise amended or supplemented and on the Closing
Date, each of the Prospectus and, if required to be filed pursuant to Rules
434(c)(2) and 424(b) under the Act, the Integrated Prospectus, as amended or
supplemented at any such time, (i) contained or will contain all statements
required to be stated therein in accordance with, and complied or will comply in
all material respects with the requirements of, the Act and the Exchange Act and
the respective rules and regulations of the Commission thereunder and (ii) did
not or will not include 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
foregoing provisions of this paragraph (b) do not apply to statements or
omissions made in any Preliminary Prospectus
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or any amendment or supplement thereto, the Registration Statement or any
amendment thereto, the Prospectus or, if required to be filed pursuant to Rules
434(c)(2) and 424(b) under the Act, the Integrated Prospectus or any amendment
or supplement thereto in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein.
(c) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State of
Maryland and is duly qualified to transact business and is in good standing
under the laws of all other jurisdictions where the ownership or leasing of its
properties or the conduct of its business requires such qualification, except
where the failure to be so qualified does not amount to a material liability or
disability to the Company and its subsidiaries, taken as a whole.
(d) Each of the subsidiaries of the Company (the
"Subsidiaries") has been duly organized and is validly existing as a general or
limited partnership or corporation in good standing under the laws of the
jurisdiction of its organization, and is duly qualified to transact business and
is in good standing under the laws of all other jurisdictions where the
ownership or leasing of its properties or the conduct of its business requires
such qualification, except where the failure to be so qualified does not amount
to a material liability or disability to the Company and its subsidiaries, taken
as a whole. The issued shares of capital stock of each of the Subsidiaries that
is a corporation are duly authorized, validly issued, fully paid and
nonassessable, and all of the partnership interests in each Subsidiary that is a
partnership are validly issued and fully paid. Except as described in the
Prospectus and any Integrated Prospectus (or, if the Prospectus and any required
Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus), all of such shares and interests in the Subsidiaries owned by the
Company are owned beneficially by the Company or another Subsidiary free and
clear of any security interests, mortgages, pledges, grants, liens,
encumbrances, equities or claims.
(e) There are no outstanding (A) securities or obligations of
the Company or any of the Subsidiaries convertible into or exchangeable for any
capital stock of the Company or any Subsidiary, (B) warrants, rights or options
to subscribe for or purchase from the Company or any Subsidiary any such capital
stock or any such convertible or exchangeable securities or obligations, or (C)
obligations of the Company or any such Subsidiary to issue any shares of capital
stock, any such convertible or exchangeable securities or obligations, or any
such warrants, rights or options, except as described in the Prospectus and any
Integrated Prospectus (or, if the Prospectus and any required Integrated
Prospectus are not in existence, the most recent Preliminary Prospectus).
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(f) The Company and each of the Subsidiaries has full power,
corporate or other, to own or lease their respective properties and conduct
their respective businesses as described in the Registration Statement, the
Prospectus and any Integrated Prospectus (or, if the Prospectus and any required
Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus); and the Company has full power, corporate or other, to enter into
this Agreement and any other agreement pursuant to which the Securities are
issued as specified in Schedule 1 to this Agreement (the "Securities Documents")
and to carry out all the terms and provisions hereof and thereof to be carried
out by it.
(g) The Company has an authorized, issued and outstanding
capitalization as set forth in the Prospectus and any Integrated Prospectus (or,
if the Prospectus and any required Integrated Prospectus are not in existence,
the most recent Preliminary Prospectus). All of the capital stock of the Company
has been duly authorized and the capital stock of the Company outstanding is
validly issued, fully paid and nonassessable.
(h) The Securities have been duly authorized, and, when such
securities are issued and delivered as contemplated by the terms of this
Agreement and the applicable Securities Document such securities will be validly
issued, fully paid and non-assessable.
(i) The execution and delivery of the Securities have been
duly authorized by all necessary corporate action, and, at the Closing Date the
Securities will have been duly executed and delivered by the Company, and if
applicable, assuming due authorization, execution and delivery of the Securities
by parties other than the Company, will be the legal, valid, binding and
enforceable obligations of the Company, subject to the effect of bankruptcy,
insolvency, moratorium, fraudulent conveyance, reorganization and similar laws
relating to creditors' rights generally and to the application of equitable
principles in any proceeding, whether at law or in equity.
(j) The securities of the Company issuable in exchange for or
upon conversion of the Securities as specified in Schedule 1 to this Agreement
(the "Underlying Securities") have been duly authorized and reserved, and, when
such securities are issued and delivered as contemplated by the terms of the
applicable Securities Document, such securities will be validly issued, fully
paid and non-assessable.
(g) The execution and delivery of the Securities Documents has
been duly authorized by all necessary corporate action of the Company, and, at
the Closing Date such agreements will have been duly executed and delivered by
the Company, and assuming due authorization, execution and delivery of the
Securities Documents by parties other than the Company as specified in the
applicable Securities Documents, and, if required, such Securities
5
Documents have been filed with the Secretary of State of the State of Maryland
or any other applicable jurisdiction, and such agreements will constitute valid
and binding instruments of the Company enforceable against the Company in
accordance with their respective terms, subject to the effect of bankruptcy,
insolvency, moratorium, fraudulent conveyance, reorganization and similar laws
relating to creditors' rights generally and to the application of equitable
principles in any proceeding, whether at law or in equity.
(k) No holders of outstanding shares of capital stock of the
Company are entitled as such to any preemptive or other rights to subscribe for
any of the Securities or Underlying Securities, and no holder of securities of
the Company or any Subsidiary has any right which has not been waived to require
the Company to register the offer or sale of any securities owned by such holder
under the Act in the public offering contemplated by this Agreement.
(l) The Securities and Underlying Securities conform to their
description contained in the Prospectus and any Integrated Prospectus (or, if
the Prospectus and any required Integrated Prospectus are not in existence, the
most recent Preliminary Prospectus).
(m) The combined financial statements and schedules of the
Company and the Cali Group (as defined in the Registration Statement) and the
consolidated financial statements and schedules of the Company and its
consolidated subsidiaries included in or incorporated by reference in the
Registration Statement, the Prospectus and any Integrated Prospectus (or, if the
Prospectus and any required Integrated Prospectus are not in existence, the most
recent Preliminary Prospectus) fairly present the combined financial position of
the Company and the Cali Group and fairly present the consolidated financial
position of the Company and its consolidated subsidiaries, as the case may be,
and the results of operations and changes in financial condition as of the dates
and periods therein specified. Such combined and consolidated financial
statements and schedules have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved (except as otherwise noted therein).
(n) The selected financial data set forth under the caption
"Selected Financial Data" in the Prospectus and any Integrated Prospectus (or,
if the Prospectus and any required Integrated Prospectus are not in existence,
the most recent Preliminary Prospectus) fairly present, on the basis stated in
the Prospectus and any Integrated Prospectus (or such Preliminary Prospectus)
and such Annual Report, the information included therein. The pro forma
financial statements and other pro forma financial information included in or
incorporated therein in the Prospectus and any Integrated Prospectus (or, if the
Prospectus and any required Integrated Prospectus are not in existence, the most
recent Preliminary Prospectus) present fairly and comply in all material
respects with the applicable requirements of Rule 11-02 of Regulation S-X of the
6
Commission and the pro forma adjustments have been properly applied to the
historical amounts in the compilation of such statements and the assumptions
used in the preparation thereof are, in the opinion of the Company, reasonable.
(o) Price Waterhouse LLP, which has certified certain
financial statements of the Company and its consolidated subsidiaries and of the
Cali Group and delivered its reports with respect to the audited consolidated
financial statements and schedules, and any other accounting firm that has
certified financial statements and delivered its reports with respect thereto,
included or incorporated by reference in the Registration Statement, the
Prospectus and any Integrated Prospectus (or, if the Prospectus and any required
Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus), are independent public accountants as required by the Act, the
Exchange Act and the respective rules and regulations thereunder.
(p) The execution and delivery of this Agreement has been duly
authorized by the Company and this Agreement has been duly executed and
delivered by the Company, and is the valid and binding agreement of the Company
enforceable against the Company in accordance with the terms hereof, subject to
the effect of bankruptcy, insolvency, moratorium, fraudulent conveyance,
reorganization and similar laws relating to creditors' rights generally and to
the application of equitable principles in any proceeding, whether at law or in
equity and except as rights to indemnity and contribution hereunder may be
limited by federal or state securities laws or principles of public policy.
(q) No legal or governmental proceedings are pending to which
the Company or any of the Subsidiaries or to which the property of the Company
or any of the Subsidiaries is subject, that are required to be described in the
Registration Statement, the Prospectus or any Integrated Prospectus (or, if the
Prospectus and any required Integrated Prospectus are not in existence, the most
recent Preliminary Prospectus) and are not described therein, and no such
proceedings have been threatened against the Company or any of the Subsidiaries;
and no contract or other document is required to be described in the
Registration Statement, the Prospectus or any Integrated Prospectus (or, if the
Prospectus and any required Integrated Prospectus are not in existence, the most
recent Preliminary Prospectus) or to be filed as an exhibit to the Registration
Statement that is not described therein or filed as required.
(r) The issuance, offering and sale of the Securities to the
Underwriters by the Company pursuant to this Agreement and the Securities
Documents, the compliance by the Company with the other provisions of this
Agreement, the Securities and the Securities Documents and the consummation of
the other transactions herein and therein contemplated do not (i) require the
consent, approval, authorization, registration or qualification of or with any
governmental authority, except such as have been obtained, such as may be
required under state securities or
7
blue sky laws and, if the registration statement filed with respect to the
Securities (as amended) is not effective under the Act as of the time of
execution hereof, such as may be required (and shall be obtained as provided in
this Agreement) under the Act, or (ii) conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or encumbrance upon
any of the properties or assets of the Company or any of the Subsidiaries
pursuant to any indenture, mortgage, deed of trust, lease or other agreement or
instrument to which the Company or any of the Subsidiaries is a party or by
which the Company or any of the Subsidiaries or any other of their respective
properties are bound, or the Articles of Incorporation, By-laws or other
organizational documents, as the case may be, of the Company or any of the
Subsidiaries, or any statute or any judgment, decree, order, rule or regulation
of any court or other governmental authority or any arbitrator applicable to the
Company or any of the Subsidiaries or any of their properties.
(s) 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.
(t) Subsequent to the respective dates as of which information
is given in the Registration Statement, the Prospectus and any Integrated
Prospectus (or, if the Prospectus and any required Integrated Prospectus are not
in existence, the most recent Preliminary Prospectus), (1) neither the Company
nor any of the Subsidiaries has incurred any material liability or obligation,
direct or contingent, or entered into any material transaction, which is not in
the ordinary course of business; (2) except for regular quarterly distribution
payments, the Company has not purchased any of its outstanding capital stock,
nor declared, paid or otherwise made any dividend or distribution of any kind on
its capital stock; (3) there has not been any material change in the capital
stock, short-term debt or long-term debt of the Company or the Subsidiaries; and
(4) there has been no material adverse change in the condition (financial or
otherwise), business prospects, net worth or results of operations of the
Company and its subsidiaries, taken as a whole, except in each case as described
in or contemplated by the Prospectus and any Integrated Prospectus (or, if the
Prospectus and any required Integrated Prospectus are not in existence, the most
recent Preliminary Prospectus).
(u) The Company or the Subsidiaries have good and indefeasible
title in fee simple to all of the Properties (as defined in the Prospectus) and
marketable title to all other property owned by each of them, in each case free
and clear of any security interest, lien,
8
mortgage, pledge, encumbrance, equity, claim and other defect, except liens
which do not materially and adversely affect the value of such property and will
not interfere with the use made or proposed to be made of such property by the
Company or such Subsidiary, and any and all real property and buildings held
under lease by the Company or any such Subsidiary are held under valid,
subsisting and enforceable leases, with such exceptions as are not material and
do not interfere with the use made or proposed to be made of such property and
buildings by the Company or such Subsidiary, in each case except as described in
the Prospectus and any Integrated Prospectus (or, if the Prospectus and any
required Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus).
(v) No labor dispute with the employees of the Company or any
of the Subsidiaries exists or is threatened or imminent that could result in a
material adverse change in the condition (financial or otherwise), business
prospects, net worth or results of operations of the Company and the
Subsidiaries, taken as a whole, except as described in the Prospectus and any
Integrated Prospectus (or, if the Prospectus and any required Integrated
Prospectus are not in existence, the most recent Preliminary Prospectus).
(w) The Company and the Subsidiaries own or possess, or can
acquire on reasonable terms, all material patents, trademarks, service marks,
trade names, licenses, copyrights and proprietary and other confidential
information currently employed by them in connection with their respective
businesses, and neither the Company nor any of the Subsidiaries has received any
notice of infringement of or conflict with asserted rights of any third party
with respect to the foregoing which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would result in a material
adverse change in the condition (financial or otherwise), business prospects,
net worth or results of operations of the Company and the Subsidiaries, taken as
a whole, except as described in the Prospectus and any Integrated Prospectus
(or, if the Prospectus and any required Integrated Prospectus are not in
existence, the most recent Preliminary Prospectus).
(x) The Company and each of the 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
will be engaged; neither the Company nor any of the Subsidiaries has been
refused any insurance coverage sought or applied for; and neither the Company
nor any of the Subsidiaries has any reason to believe that any of them will not
be able to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may be necessary
to continue its business at a cost that would not have material adverse effect
on the condition (financial or otherwise), business prospects, net worth or
results of operations of the Company and the Subsidiaries, taken as a whole,
except as described in the Prospectus and any Integrated Prospectus (or, if the
Prospectus
9
and any required Integrated Prospectus are not in existence, the most recent
Preliminary Prospectus).
(y) None of the Subsidiaries is currently prohibited, directly
or indirectly, from paying any dividends to the Company, from making any other
distribution on such subsidiary's capital stock or other equity interest, from
repaying to the Company any loans or advances to such Subsidiary from the
Company or from transferring any of such Subsidiary's property or assets to the
Company or any of the other Subsidiaries, except as described in the Prospectus
and any Integrated Prospectus (or, if the Prospectus and any required Integrated
Prospectus are not in existence, the most recent Preliminary Prospectus).
(z) The Company and each of the Subsidiaries has complied with
all laws, regulations and orders applicable to it or its respective business and
properties except where the failure to so comply would not result in a material
adverse change in the condition (financial or otherwise), business prospects,
net worth or results of operations of the Company and the Subsidiaries, taken as
a whole; the Company and the Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state, municipal
or foreign regulatory authorities necessary to conduct their respective
businesses except where the failure to possess the same would not result in a
material adverse change in the condition (financial or otherwise), business
prospects, net worth or results of operations of the Company and the
Subsidiaries, taken as a whole; and neither the Company nor any of the
Subsidiaries has received any notice of proceedings relating to the revocation
or modification of any such certificate, authorization or permit which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a material adverse change in the condition (financial
or otherwise), business prospects, net worth or results of operations of the
Company and the Subsidiaries, taken as a whole, except as described in the
Prospectus and any Integrated Prospectus (or, if the Prospectus and any required
Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus).
(aa) The Company will conduct its operations in a manner that
will not subject it to registration as an investment company under the
Investment Company Act of 1940, as amended, and the transactions contemplated by
this Agreement will not cause the Company to become an investment company
subject to registration under such Act.
(ab) The Company and each of the Subsidiaries has filed all
foreign, federal, state and local tax returns that are required to be filed or
have requested extensions thereof (except in any case in which the failure so to
file would not have a material adverse effect on the condition (financial or
otherwise), business prospects, net worth or results of operations of the
Company and the Subsidiaries, taken as a whole) and has paid all taxes required
to be paid
10
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 described
in the Prospectus and any Integrated Prospectus (or, if the Prospectus and any
required Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus).
(ac) The Company is organized in conformity with the
requirements for qualification as a real estate investment trust (a "REIT")
under the Internal Revenue Code of 1986, as amended (the "Code"), and the
present and contemplated method of operation of the Company and the Subsidiaries
does and will enable the Company to meet the requirements for taxation as a REIT
under the Code.
(ad) Neither the Company nor any of the Subsidiaries is in
violation of any federal or state law or regulation relating to occupational
safety and health and the Company and the Subsidiaries have received all
permits, licenses or other approvals required of them under applicable federal
and state occupational safety and health and environmental laws and regulations
to conduct their respective businesses, and the Company and each of the
Subsidiaries is in compliance with all terms and conditions of any such permit,
license or approval, except any such violation of law or regulation, failure to
receive required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or approvals which would not,
singly or in the aggregate result in a material adverse change in the condition
(financial or otherwise), business prospects, net worth or results of operations
of the Company and the Subsidiaries, taken as a whole, except as described in
the Prospectus and any Integrated Prospectus (or, if the Prospectus and any
required Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus).
(ae) Except for the shares of capital stock of each of the
Subsidiaries owned by the Company or another Subsidiary, neither the Company nor
any of the Subsidiaries owns any shares of stock or any other equity securities
of any corporation or has any equity interest in any firm, partnership,
association or other entity, except as described in or contemplated by the
Prospectus and any Integrated Prospectus (or, if the Prospectus and any required
Integrated Prospectus are not in existence, the most recent Preliminary
Prospectus).
(af) The Company and the Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (1)
transactions are executed in accordance with management's general or specific
authorizations; (2) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted accounting
principles and to maintain asset accountability; (3) access to assets is
permitted only in accordance with management's general or specific
authorization; and (4) the recorded
11
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
(ag) Neither the Company nor any of the Subsidiaries is in
violation of any term or provision of its Articles of Incorporation, By-laws,
partnership agreements or other organizational documents, as the case may be; no
default exists, and no event has occurred which, with notice or lapse of time or
both, would constitute a default, and the consummation of the transactions by
this Agreement and under the Securities Documents will not result in any default
in the due performance and observance of any term, covenant or condition of any
indenture, mortgage, deed of trust, lease or other agreement or instrument to
which the Company or any Subsidiary is a party or by which the Company, the
Subsidiaries or the Properties or any of their respective other properties is
bound or may be affected except such as would not result in any material adverse
effect in the condition (financial or otherwise), business prospects, net worth
or results of operations of the Company and the Subsidiaries, taken as a whole.
(ah) If required as set forth in Schedule 1 hereto, the
Securities and any Underlying Securities have been approved for listing on the
New York Stock Exchange, subject to official notice of issuance.
(ai) (A) Neither the Company nor any Subsidiary knows of any
violation of any municipal, state or federal law, rule or regulation (including
those pertaining to environmental matters) concerning the Properties or any part
thereof which would have a material adverse effect in the condition (financial
or otherwise), business prospects, net worth or results of operations of the
Company and the Subsidiaries, taken as a whole; (B) each of the Properties
complies with all applicable zoning laws, ordinances, regulations and deed
restrictions or other covenants 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 the Properties and will not result in a forfeiture or reversion
of title; (C) neither the Company nor any Subsidiary has received from any
governmental authority any written notice of any condemnation of or zoning
change affecting the Properties or any part thereof, and neither the Company nor
any Subsidiary knows of any such condemnation or zoning change which is
threatened and which if consummated would have a material adverse effect in the
condition (financial or otherwise), business prospects, net worth or results of
operations of the Company and the Subsidiaries, taken as a whole; (D) all liens,
charges, encumbrances, claims, or restrictions on or affecting the properties
and assets (including the Properties) of the Company or any of the Subsidiaries
that are required to be described in the Prospectus and any Integrated
Prospectus (or, if the Prospectus and any required Integrated Prospectus are not
in existence, the most recent Preliminary Prospectus) are disclosed therein; (E)
no lessee of any portion of any of the Properties is in default under any of the
leases governing such properties and there is no event which, but for the
passage of time or the giving of notice or
12
both would constitute a default under any of such leases, except such defaults
that would not have a material adverse effect in the condition (financial or
otherwise), business prospects, net worth or results of operations of the
Company and the Subsidiaries, taken as a whole; and (F) no tenant under any
lease pursuant to which the Company or any of the Subsidiaries leases the
Properties has an option or right of first refusal to purchase the premises
leased thereunder or the building of which such premises are a part, except as
such options or rights of first refusal which, if exercised, would not have a
material adverse effect in the condition (financial or otherwise), business
prospects, net worth or results of operations of the Company and the
Subsidiaries, taken as a whole, and except as provided by law.
(aj) Except as otherwise disclosed in the Prospectus and any
Integrated Prospectus (or, if the Prospectus and any required Integrated
Prospectus are not in existence, the most recent Preliminary Prospectus) or in
the Phase I Environmental Audits prepared by Environmental Waste Management
Associates, Inc. previously delivered to the Representatives (the "Audits"), (i)
neither the Company, any of the Subsidiaries nor, to the best knowledge of the
Company, any other owners of the property at any time or any other party has at
any time, handled, stored, treated, transported, manufactured, spilled, leaked,
or discharged, dumped, transferred or otherwise disposed of or dealt with,
Hazardous Materials (as hereinafter defined) on, to or from the Properties,
other than by any such action taken in compliance with all applicable
Environmental Statutes or by the Company, any of the Subsidiaries or any other
party in connection with the ordinary use of residential, retail or commercial
properties owned by the Company; (ii) the Company does not intend to use the
Properties or any subsequently acquired properties for the purpose of handling,
storing, treating, transporting, manufacturing, spilling, leaking, discharging,
dumping, transferring or otherwise disposing of or dealing with Hazardous
Materials other than by any such action taken in compliance with all applicable
Environmental Statues or by the Company, any of the Subsidiaries or any other
party in connection with the ordinary use of residential, retail or commercial
properties owned by the Company; (iii) neither the Company nor any of the
Subsidiaries knows of any seepage, leak, discharge, release, emission, spill, or
dumping of Hazardous Materials into waters on or adjacent to the Properties or
any other real property owned or occupied by any such party, or onto lands from
which Hazardous Materials might seep, flow or drain into such waters; (iv)
neither the Company nor any of the Subsidiaries has received any notice of, or
has any knowledge of any occurrence or circumstance which, with notice or
passage of time or both, would give rise to a claim under or pursuant to any
federal, state or local environmental statute or regulation or under common law,
pertaining to Hazardous Materials on or originating from any of the Properties
or any assets described in the Prospectus and any Integrated Prospectus (or, if
the Prospectus and any required Integrated Prospectus are not in existence, the
most recent Preliminary Prospectus) or any other real property owned or occupied
by any such party or arising out of the conduct of any such party, including
without limitation a claim under or pursuant to any Environmental Statute
(hereinafter
13
defined); (v) neither the Properties nor any other land owned by the Company or
any of the Subsidiaries is included or, to the best of the Company's knowledge,
proposed for inclusion on the National Priorities List issued pursuant to CERCLA
(as hereinafter defined) by the United States Environmental Protection Agency
(the "EPA") or, to the best of the Company's knowledge, proposed for inclusion
on any similar list or inventory issued pursuant to any other Environmental
Statute or issued by any other Governmental Authority (as hereinafter defined).
As used herein, "Hazardous Material" shall include, without
limitation any flammable explosives, radioactive materials, hazardous materials,
hazardous wastes, toxic substances, or related materials, asbestos or any
hazardous material as defined by any federal, state or local environmental law,
ordinance, rule or regulation including without limitation the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended, 42
U.S.C. xx.xx. 9601-9675 ("CERCLA"), the Hazardous Materials Transportation Act,
as amended, 49 U.S.C. xx.xx. 1801-1819, the Resource Conservation and Recovery
Act, as amended, 42 U.S.C. xx.xx. 6901-6992K, the Emergency Planning and
Community Right-to-Know Act of 1986, 42 U.S.C. xx.xx. 11001-11050, the Toxic
Substances Control Act, 15 U.S.C. xx.xx. 2601-2671, the Federal Insecticide,
Fungicide and Rodenticide Act, 7 U.S.C. xx.xx. 136-136y, the Clean Air Act, 42
U.S.C. xx.xx. 7401-7642, the Clean Water Act (Federal Water Pollution Control
Act), 33 U.S.C. xx.xx. 1251-1387, the Safe Drinking Water Act, 42 U.S.C. xx.xx.
300f-300j-26, and the Occupational Safety and Health Act, 29 U.S.C. xx.xx.
651-678, as any of the above statutes may be amended from time to time, and in
the regulations promulgated pursuant to each of the foregoing (individually, an
"Environmental Statute") or by any federal, state or local governmental
authority having or claiming jurisdiction over the properties and assets
described in the Prospectus (a "Governmental Authority").
(ak) Each certificate signed by any officer of the Company and
delivered to the Representatives or counsel for the Underwriters shall be deemed
to be a representation and warranty by the Company to each Underwriter as to the
matters covered thereby.
(al) The Company has not distributed and, prior to the later
of (i) the Closing Date and (ii) the completion of the distribution of the
Securities, will not distribute any material in connection with the offering and
sale of the Securities other than the Registration Statement or any amendment
thereto, any Preliminary Prospectus, the Prospectus or any Integrated Prospectus
or any amendment or supplement thereto, or other materials, if any, permitted by
the Act.
3. Purchase, Sale and Delivery of the Securities.
14
(a) On the basis of the representations, warranties,
agreements and covenants herein contained and subject to the terms and
conditions herein set forth, the Company agrees to issue and sell to each of the
Underwriters, and each of the Underwriters, severally and not jointly, agrees to
purchase from the Company, at the purchase price specified in Schedule 1 hereto,
the number of Securities set forth opposite the name of such Underwriter in
Schedule 2 hereto. One or more certificates in definitive form for the
Securities that the several Underwriters have agreed to purchase hereunder, and
in such denomination or denominations and registered in such name or names as
the Representatives request upon notice to the Company at least 48 hours prior
to the Closing Date, shall be delivered by or on behalf of the Company to the
Representatives for the respective accounts of the Underwriters, against
payment by or on behalf of the Underwriters of the purchase price therefor to
the Company in such funds as are specified in Schedule 1 hereto. Such delivery
of and payment for the Securities shall be made at the date, time and place
identified in Schedule 1 hereto, or at such other date, time or place as the
Representatives and the Company may agree upon or as the Representatives may
determine pursuant to Section 8 hereof, such date and time of delivery against
payment being herein referred to as the "Closing Date". The Company will make
such certificate or certificates for the Securities available for checking and
packaging by the Representatives at the offices in New York, New York of the
Company's transfer agent or registrar or warrant agent or of Prudential
Securities Incorporated at least 24 hours prior to the Closing Date.
4. Covenants of the Company. The Company covenants and agrees with
each of the Underwriters that:
(a) The Company will file the Prospectus or any Term Sheet
that constitutes a part thereof, any Integrated Prospectus or the Prospectus
Supplement, as the case may be, and any amendment or supplement thereto with the
Commission in the manner and within the time period required by Rules 434 and
424(b) under the Act. During any time when a prospectus relating to the
Securities is required to be delivered under the Act, the Company (i) will
comply with all requirements imposed upon it by the Act and the Exchange Act and
the respective rules and regulations of the Commission thereunder to the extent
necessary to permit the continuance of sales of or dealings in the Securities in
accordance with the provisions hereof and of the Prospectus and any Integrated
Prospectus, as then amended or supplemented, and (ii) will not file with the
Commission the Prospectus, Term Sheet, any Integrated Prospectus or any
amendment or supplement thereto or any amendment to the Registration Statement
of which the Representatives shall not previously have been advised and
furnished with a copy for a reasonable period of time prior to the proposed
filing and as to which filing the Representatives shall not have given their
consent. The Company will prepare and file with the Commission, in accordance
with the rules and regulations of the Commission, promptly upon request by the
Representatives or counsel for the Underwriters, any amendment to the
Registration Statement or amendment or
15
supplement to the Prospectus and any Integrated Prospectus that may be necessary
or advisable in connection with the distribution of the Securities by the
several Underwriters, and will use its best efforts to cause any such amendment
to the Registration Statement to be declared effective by the Commission as
promptly as possible. The Company will advise the Representatives, promptly
after receiving notice thereof, of the time when any amendment to the
Registration Statement has been filed or declared effective or the Prospectus,
any Integrated Prospectus or any amendment or supplement thereto has been filed
and will provide evidence satisfactory to the Representatives of each such
filing or effectiveness.
(b) The Company will advise the Representatives, promptly
after receiving notice or obtaining knowledge thereof, of (i) the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment thereto or any order
directed at any document incorporated by reference in the Registration
Statement, the Prospectus or any Integrated Prospectus or any amendment or
supplement thereto or any order preventing or suspending the use of any
Preliminary Prospectus, the Prospectus or any Integrated Prospectus or any
amendment or supplement thereto, (ii) the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, (iii) the institution,
threatening or contemplation of any proceeding for any such purpose or (iv) any
request made by the Commission for amending the Registration Statement, for
amending or supplementing any Preliminary Prospectus, the Prospectus or any
Integrated Prospectus or for additional information. The Company will use its
best efforts to prevent the issuance of any such stop order and, if any such
stop order is issued, to obtain the withdrawal thereof as promptly as possible.
(c) If required by applicable law, the Company will arrange
for the qualification of the Securities and any Underlying Securities for
offering and sale under the securities or blue sky laws of such jurisdictions as
the Representatives may designate and will continue such qualifications in
effect for as long as may be necessary to complete the distribution of the
Securities and any Underlying Securities; provided, however, that in connection
therewith the Company shall not be required to qualify as a foreign corporation
or to execute a general consent to service of process in any jurisdiction.
(d) If at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs as a
result of which the Prospectus or any Integrated Prospectus, as then amended or
supplemented, would 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, or if for
any other reason it is necessary at any time to amend or supplement the
Prospectus or any Integrated Prospectus to comply with the Act or Exchange Act
or the respective rules or regulations of the Commission thereunder, the Company
will promptly notify the Representatives thereof and,
16
subject to Section 4(a) of this Agreement, will prepare and file with the
Commission, at the Company's expense, an amendment to the Registration Statement
or an amendment or supplement to the Prospectus and any Integrated Prospectus
that corrects such statement or omission or effects such compliance.
(e) The Company will, without charge, provide (i) to the
Representatives and to counsel for the Underwriters, a conformed copy of the
registration statement originally filed with respect to the Securities and any
amendment thereto (in each case including exhibits thereto), (ii) to each other
Underwriter, a conformed copy of such registration statement and any amendment
thereto relating to the Securities (in each case without exhibits thereto) and
(iii) so long as a prospectus relating to the Securities is required to be
delivered under the Act, as many copies of each Preliminary Prospectus, the
Prospectus or any Integrated Prospectus or any amendment or supplement thereto
as the Representatives may reasonably request; without limiting the application
of clause (iii) of this sentence, the Company, not later than (A) 6:00 p.m., New
York city time, on the date of determination of the public offering price, if
such determination occurred at or prior to 10:00 AM, New York City time, on such
date or (B) 12:00 Noon, New York City time, on the business day following the
date of determination of the public offering price, if such determination
occurred after 10:00 AM, New York city time, on such date, will deliver to the
Representatives, without charge, as many copies of the Prospectus or any
Integrated Prospectus and any amendment or supplement thereto as the
Representatives may reasonably request for purposes of confirming orders that
are expected to settle on the Closing Date.
(f) The Company, as soon as practicable, will make generally
available to its securityholders and to the Representatives a consolidated
earning statement of the Company and its subsidiaries that satisfies the
provisions of Section 11(a) of the Act and Rule 158 thereunder.
(g) The Company will apply the net proceeds from the sale of
the Securities as set forth under "Use of Proceeds" in the Prospectus and any
Integrated Prospectus.
(h) [Intentionally omitted].
(i) If required as set forth in Schedule 1 hereto, the Company
will obtain the agreements described in Section 6(g) hereof prior to the Closing
Date.
(j) The Company will not, directly or indirectly, (i) take 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) (A) sell, bid for, purchase, or pay anyone any
17
compensation for soliciting purchases of the Securities or (B) pay or agree to
pay to any person any compensation for soliciting another to purchase any other
securities of the Company.
(k) If at any time during the 25-day period after the
Registration Statement becomes effective, any rumor, publication or event
relating to or affecting the Company shall occur as a result of which in your
opinion the market price of the Common Stock has been or is likely to be
materially affected (regardless of whether such rumor, publication or event
necessitates a supplement to or amendment of the Prospectus or any Integrated
Prospectus), the Company will, after written notice from you advising the
Company to the effect set forth above, forthwith prepare, consult with you
concerning the substance of, and disseminate a press release or other public
statement, reasonably satisfactory to you, responding to or commenting on such
rumor, publication or event.
(l) If required as set forth in Schedule 1 hereto, the Company
will cause the Securities and any Underlying Securities to be duly authorized
for listing by the New York Stock Exchange.
(m) The Company will continue to use its best efforts to meet
the requirements to qualify as a REIT under the Code.
5. Expenses. The Company will pay all costs and expenses incident to
the performance of its obligations under this Agreement, whether or not the
transactions contemplated herein are consummated or this Agreement is terminated
pursuant to Section 10 hereof, including all costs and expenses incident to (i)
the printing or other production of documents with respect to the transactions,
including any costs of printing the registration statement originally filed with
respect to the Securities and any amendment thereto, any Preliminary Prospectus,
the Prospectus and any Integrated Prospectus and any amendment or supplement
thereto, this Agreement, the Securities Documents and any blue sky memoranda,
(ii) all arrangements relating to the delivery to the Underwriters of copies of
the foregoing documents, (iii) the fees and disbursements of counsel,
accountants and any other experts or advisors retained by the Company, (iv)
preparation, issuance and delivery to the Underwriters of any certificates
evidencing the Securities, including the fees and expenses of the transfer
agent, exchange agent or registrar, (v) the qualification, if any, of the
Securities and any Underlying Securities under state securities and blue sky
laws and real estate syndication laws, including filing fees and fees and
disbursements of counsel for the Underwriters relating thereto and relating to
the preparation of a blue sky memoranda, (vi) the filing fees of the Commission
relating to the Securities, (vii) any listing of the Securities and Underlying
Securities on the New York Stock Exchange, (viii) any meetings with prospective
investors in the Securities arranged by the Company (other than as shall have
been specifically approved by the Representatives to be paid for by the
Underwriters) and (ix) advertising relating
18
to the offering of the Securities requested by the Company (other than as shall
have been specifically approved by the Representatives to be paid for by the
Underwriters). If the sale of the Securities provided for herein is not
consummated because any condition to the obligations of the Underwriters set
forth in Section 6 of this Agreement is not satisfied, because this Agreement is
terminated pursuant to Section 10 of this Agreement or because of any failure,
refusal or inability on the part of the Company to perform all obligations and
satisfy all conditions on its part to be performed or satisfied hereunder other
than by reason of a default by and of the Underwriters, the Company will
reimburse the Underwriters severally upon demand for all out-of-pocket expenses
(including counsel fees and disbursements) that shall have been incurred by them
in connection with the proposed purchase and sale of the Securities. The Company
shall not in any event be liable to any of the Underwriters for the loss of
anticipated profits from the transactions covered by this Agreement.
6. Conditions of the Underwriters' Obligations. The obligations of
the Underwriters to purchase and pay for the Securities shall be subject, in the
Representatives' sole discretion, to the accuracy of the representations and
warranties of the Company contained herein as of the date of this Agreement as
specified in Schedule 1 hereto and as of the Closing Date, as if made on and as
of the Closing Date, to the accuracy of the statements of the Company's officers
made pursuant to the provisions hereof, to the performance by the Company of its
covenants and agreements hereunder and to the following additional conditions:
(a) The Prospectus, any Integrated Prospectus or the
Prospectus Supplement, as the case may be, and any amendment or supplement
thereto shall have been filed with the Commission in the manner and within the
time period required by Rules 434 and 424(b) under the Act; no stop order
suspending the effectiveness of the Registration Statement or any post-effective
amendment thereto and no order directed at any document incorporated by
reference in the Registration Statement, the Prospectus or any Integrated
Prospectus or any amendment or supplement thereto shall have been issued, and no
proceedings for that purpose shall have been instituted or threatened or, to the
knowledge of the Company or the Representatives, shall be contemplated by the
Commission; and the Company shall have complied with any request of the
Commission for additional information (to be included in the Registration
Statement, the Prospectus or any Integrated Prospectus or otherwise).
(b) The Representatives shall have received an opinion, dated
the Closing Date, from Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP counsel for the
Company, to the effect that:
(i) the Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State of
Maryland and is duly
19
qualified to transact business and is in good standing under the laws of
all other jurisdictions where the ownership or leasing of its properties
or the conduct of its business requires such qualification, except where
the failure to be so qualified does not amount to a material liability or
disability to the Company and the Subsidiaries, taken as a whole. Each of
the Subsidiaries has been duly organized and is validly existing as a
general or limited partnership or corporation in good standing under the
laws of the jurisdiction of its organization, and is duly qualified to
transact business and is in good standing under the laws of all other
jurisdictions where the ownership or leasing of its properties or the
conduct of its business requires such qualification, except where the
failure to be so qualified does not amount to a material liability or
disability to the Company and the Subsidiaries, taken as a whole;
(ii) the Company and each of the Subsidiaries have full
power, corporate or other, to own or lease their respective properties and
conduct their respective businesses as described in the Registration
Statement, the Prospectus and any Integrated Prospectus and each of the
Company and the Subsidiaries have full power, corporate or other, to enter
into this Agreement and the Securities Documents and to carry out all the
terms and provisions hereof and thereof to be carried out by it;
(iii) the issued shares of capital stock of each of the
Subsidiaries that is a corporation are duly authorized, validly issued,
fully paid and nonassessable, and all of the partnership interests in each
Subsidiary that is a partnership are validly issued and fully paid. Except
as described in the Registration Statement, the Prospectus and any
Integrated Prospectus, all of such shares and interests owned by the
Company or another Subsidiary are owned beneficially by the Company or
such Subsidiary free and clear of any security interest, mortgage, pledge,
lien, encumbrance, equity or claim;
(iv) As of May 15, 1998, the Company had an authorized
capitalization consisting of (A) 5,000,000 preferred shares of beneficial
interest, of which 0 shares were issued and outstanding, and (B)
190,000,000 Common Shares, of which 56,981,742 shares were issued and
outstanding (excluding 18,173,403 Common Shares reserved for issuance (x)
upon the exercise of outstanding options and (y) upon the conversion of
13,433,572 outstanding units in the Operating Partnership. All of the
capital stock of the Company has been duly authorized and the capital
stock of the Company outstanding is validly issued, fully paid and
nonassessable;
(v) the Securities have been duly authorized, and when
executed and delivered against payment therefor in accordance with the
Underwriting Agreement, will be validly issued, fully paid and
non-assessable, and the execution and delivery of the
20
Securities (other than any Contract Securities) have been duly authorized
by all necessary corporate action, and the Securities have been duly
executed and delivered by the Company, and assuming due authorization,
execution and delivery of the Securities by parties other than the
Company, are, and any Contract Securities, when executed and delivered in
the manner provided in the Securities Documents, will be, the legal,
valid, binding and enforceable obligations of the Company, subject to the
effect of bankruptcy, insolvency, moratorium, fraudulent conveyance,
reorganization and similar laws relating to creditors' rights generally
and to the application of equitable principles in any proceeding, whether
at law or in equity;
(vi) the Underlying Securities have been duly authorized
and reserved, and, when such securities are issued and delivered as
contemplated by the terms of the applicable Securities Document such
securities will be validly issued, fully paid and non-assessable;
(vii) the execution and delivery of the Securities
Documents has been duly authorized by all necessary corporate action of
the Company, and have been duly executed and delivered by the Company, and
assuming due authorization, execution and delivery of the Securities
Documents by parties other than the Company as specified in the applicable
Securities Documents, such agreements are valid and binding instruments of
the Company enforceable against the Company in accordance with their
respective terms, subject to the effect of bankruptcy, insolvency,
moratorium, fraudulent conveyance, reorganization and similar laws
relating to creditors' rights generally and to the application of
equitable principles in any proceeding, whether at law or in equity;
(viii) no holders of outstanding shares of capital stock
of the Company are entitled as such to any preemptive or other rights to
subscribe for any of the Securities or Underlying Securities, and no
holder of securities of the Company or any Subsidiary has any right which
has not been waived to require the Company to register the offer or sale
of any securities owned by such holder under the Act in the public
offering contemplated by this Agreement;
(ix) the statements set forth under the heading
"Description of Common Stock", "Description of Preferred Stock" and
"Description of Warrants" in the Prospectus and any Integrated Prospectus
insofar as such statements purport to summarize certain provisions of the
Securities of the Company, provide a fair summary of such provisions; and
the statements set forth under the headings "Restrictions on Ownership of
Offered Securities" and "Certain United States Federal Income Tax
Considerations to the Company of its REIT Election" in the Prospectus and
"Risk Factors", "Certain United
21
States Federal Income Tax Considerations to Holders of Common Stock" and
"Underwriting", in the Prospectus Supplement, insofar as such statements
constitute a summary of the legal matters, documents or proceedings
referred to therein, provide a fair summary of such legal matters,
documents and proceedings;
(x) the execution and delivery of this Agreement has
been duly authorized by all necessary corporate action of the Company and
this Agreement has been duly executed and delivered by the Company, and
are the valid and binding agreements of the Company, enforceable against
the Company in accordance with their respective terms, subject to the
effect of bankruptcy, insolvency, moratorium, fraudulent conveyance,
reorganization and similar laws relating to creditors' rights generally
and to the application of equitable principles in any proceeding, whether
at law or in equity and except as rights to indemnity and contribution
hereunder may be limited by federal or state securities laws or principles
of public policy;
(xi) (A) no legal or governmental proceedings are
pending to which the Company, any of the Subsidiaries, or any of their
respective directors or officers in their capacity as such, is a party or
to which the Properties or any other property of the Company or any of the
Subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not described therein,
and, to the best knowledge of such counsel, no such proceedings have been
threatened against the Company or any of the Subsidiaries or with respect
to the Properties or any of their respective other properties and (B) no
contract or other document is required to be described in the Registration
Statement, the Prospectus or any Integrated Prospectus or to be filed as
an exhibit to the Registration Statement that is not described therein or
filed as required;
(xii) the issuance, offering and sale of the Securities
to the Underwriters by the Company pursuant to this Agreement, the
compliance by the Company with the other provisions of this Agreement, any
Securities Documents and the consummation of the other transactions herein
contemplated do not (A) require the consent, approval, authorization,
registration or qualification of or with any governmental authority,
except such as have been obtained and such as may be required under state
securities or blue sky laws (as to which such counsel need not opine) or
(B) conflict with or result in a breach or violation of any of the terms
and provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any of the
Properties or any other properties or assets of the Company or any of the
Subsidiaries pursuant to any indenture, mortgage, deed of trust, lease or
other agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which the
22
Company or any of its Subsidiaries or the Properties or any other of their
respective properties are bound, or the Articles of Incorporation, By-laws
or other organizational documents, as the case may be, of the Company or
any of the Subsidiaries, or any statute or any judgment, decree, order,
rule or regulation of any court or other governmental authority or (to the
best knowledge of such counsel) any arbitrator applicable to the Company
or any of the Subsidiaries or any of the Properties;
(xiii) none of the Subsidiaries is currently
contractually prohibited, directly or indirectly, from paying any
dividends to the Company, from making any other distribution on such
subsidiary's capital stock or other equity interests, from repaying to the
Company any loans or advances to such Subsidiary from the Company or from
transferring any of such Subsidiary's property or assets to the Company or
any of the other Subsidiaries, except as described in the Prospectus and
any Integrated Prospectus;
(xiv) to the best knowledge of such counsel, the Company
and the Subsidiaries possess all certificates, authorizations, licenses
and permits issued by the appropriate federal, state, municipal or foreign
regulatory authorities necessary to conduct their respective businesses
except for such certificates, authorizations, licenses and permits the
failure of which to possess would not be expected to result in a material
adverse change in the condition (financial or otherwise), business,
prospects, net worth or results of operations of the Company and the
Subsidiaries, taken as a whole, and neither the Company nor any of the
Subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such certificate, authorization, license
or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a material
adverse change in the condition (financial or otherwise), business,
prospects, net worth or results of operations of the Company and the
Subsidiaries, taken as a whole, except as described in the Prospectus and
any Integrated Prospectus;
(xv) 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 will not cause the
Company to become an investment company subject to registration under such
Act;
(xvi) neither the Company nor any of the Subsidiaries is
in violation of any term or provision of its articles of incorporation,
bylaws, partnership agreements or other organizational documents, as the
case may be; no default exists, and no event has occurred which, with
notice or lapse of time or both, would constitute a default, and the
issuance, offering and sale of the Securities to the Underwriters by the
Company pursuant
23
to this Agreement and the Securities Documents the compliance by the
Company with the other provisions of this Agreement, the Securities and
the Securities Documents and the consummation of the other transactions
herein and therein contemplated will not result in any default, in the due
performance and observance of any term, covenant or condition of any
indenture, mortgage or deed of trust, or any material lease or other
agreement or instrument known to such counsel after due inquiry to which
the Company or any of the Subsidiaries is a party or by which the Company,
any of the Subsidiaries, any of the Properties or any of their respective
other properties is bound or may be affected except such as would not
result in any material adverse effect in the condition (financial or
otherwise), business prospects, net worth or results of operations of the
Company and its subsidiaries, taken as a whole;
(xvii) as set forth in Schedule 1 hereto, the Securities
and any Underlying Securities have been approved for listing on the New
York Stock Exchange, subject to official notice of issuance;
(xviii) the Registration Statement is effective under
the Act; the Prospectus or any Term Sheet that constitutes a part thereof
and any Integrated Prospectus or the Prospectus Supplement, as the case
may be, has been filed with the Commission in the manner and within the
time period required by Rules 434 and 424(b); and no stop order suspending
the effectiveness of the Registration Statement or any post-effective
amendment thereto and no order directed at any document incorporated by
reference in the Registration Statement, the Prospectus, any Integrated
Prospectus or any amendment or supplement thereto has been issued, and no
proceedings for that purpose have been instituted or, to the best
knowledge of such counsel, threatened by the Commission; and
(xix) the Registration Statement originally filed with
respect to the Securities and each amendment thereto, the Prospectus and
any Integrated Prospectus (in each case, including the documents
incorporated by reference therein but not including the financial
statements and other financial and statistical data contained therein, as
to which such counsel need express no opinion) comply as to form in all
material respects with the applicable requirements of the Act and the
Exchange Act and the respective rules and regulations of the Commission
thereunder.
Such counsel shall also state that they have no reason to believe
that the Registration Statement, as of its effective date, contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not misleading or
that the Prospectus or any Integrated Prospectus, as of the date of the
Prospectus Supplement or any required Integrated Prospectus and the date of such
24
opinion, included or includes any untrue statement of a material fact or omitted
or omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
In rendering any such opinion, such counsel may rely, as to matters
of fact, to the extent such counsel deems proper, on certificates of responsible
officers of the Company and public officials and, as to matters involving the
application of laws of any jurisdiction other than the States of New York, New
Jersey and Delaware or the United States, to the extent satisfactory in form and
scope to counsel for the Underwriters, upon the opinion of local counsel. The
foregoing opinion shall also state that the Underwriters are justified in
relying upon such opinion of local counsel, and copies of such opinion shall be
delivered to the Representatives and counsel for the Underwriters.
References to the Registration Statement, the Prospectus and any
Integrated Prospectus in this paragraph (b) shall include any amendment or
supplement thereto at the date of such opinion.
(c) The Representatives shall have received an opinion, dated
the Closing Date, of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the
Underwriters, with respect to the issuance and sale of the Securities, the
Registration Statement, the Prospectus, and any Integrated Prospectus and such
other related matters as the Representatives may reasonably require, and the
Company shall have furnished to such counsel such documents as they may
reasonably request for the purpose of enabling them to pass upon such matters.
(d) The Representatives shall have received from Price
Waterhouse LLP and each other accounting firm that has certified financial
statements, and delivered its report with respect thereto, included or
incorporated by reference in the Registration Statement, the Prospectus and any
Integrated Prospectus, a letter or letters dated, respectively, the date of this
Agreement as specified in Schedule 1 hereto and the Closing Date, in form and
substance satisfactory to the Representatives, to the effect that:
(i) they are independent accountants with respect to the
Company and its subsidiaries within the meaning of the Act, the Exchange
Act and the applicable published rules and regulations thereunder;
(ii) in their opinion, the financial statements audited
by them and incorporated by reference in the Registration Statement, the
Prospectus and any Integrated Prospectus comply as to form in all material
respects with the applicable accounting
25
requirements of the Act, the Exchange Act and the related published rules
and regulations thereunder;
(iii) a reading of the minute books of the shareholders,
the board of directors and any committees thereof of the Company and each
of its consolidated subsidiaries, and inquiries of certain officials of
the Company and its consolidated subsidiaries who have responsibility for
financial and accounting matters, nothing came to their attention that
caused them to believe that:
(A) (i) any unaudited consolidated condensed financial
statements of the Company and its consolidated subsidiaries
included in the Registration Statement, the Prospectus and
any Integrated Prospectus do not comply as to form in all
material respects with the applicable accounting require ments
of the Act, the Exchange Act and the related published rules
and regulations thereunder, or (ii) any material modification
should be made to the unaudited consolidated condensed
financial statements for them to be in conformity with
generally accepted accounting principles;
(B) at a specific date not more than five business days
prior to the date of such letter, there were any changes in
the common stock or increase in mortgages and loans payable of
the Company and its consolidated subsidiaries, in each case
compared with amounts shown on the most recent consolidated
balance sheet included in the Registration Statement, the
Prospectus and any Integrated Prospectus, except for such
changes set forth in such letter;
(iv) they have carried out certain specified procedures,
not constituting an audit, with respect to certain amounts, percentages
and financial information that are derived from the general accounting
records of the Company and its consolidated subsidiaries and are included
in the Registration Statement, the Prospectus and any Integrated
Prospectus and in Exhibit 12 to the Registration Statement, including the
information included or incorporated in the Company's most recent Annual
Report on Form 10-K under the captions "Business" (Item 1), "Selected
Financial Data" (Item 6) and "Management's Discussion and Analysis of
Financial Condition and Results of Operations" (Item 7) and the
information included or incorporated in the Company's Quarterly Reports on
Form 10-Q under the caption "Management's Discussion and Analysis of
Financial Condition and Results of Operations,"and have compared such
amounts, percentages and financial information with such records and with
information
26
derived from such records and have found them to be in agreement,
excluding any questions of legal interpretation; and
(v) on the basis of a reading of any unaudited pro forma
consolidated condensed financial statements included in the Registration
Statement, the Prospectus and any Integrated Prospectus, carrying out
certain specified procedures that would not necessarily reveal matters of
significance with respect to the comments set forth in this paragraph (v),
inquiries of certain officials of the Company, its consolidated
subsidiaries and any acquired company who have responsibility for
financial and accounting matters and proving the arithmetic accuracy of
the application of the pro forma adjustments to the historical amounts in
the unaudited pro forma consolidated condensed financial statements,
nothing came to their attention that caused them to believe that the
unaudited pro forma consolidated condensed financial statements do not
comply in form in all material respects with the applicable accounting
requirements of Rule 11-02 of Regulation S-X or that the pro forma
adjustments have not been properly applied to the historical amounts in
the compilation of such statements.
In the event that the letters referred to above set forth any such
changes, decreases or increases, it shall be a further condition to the
obligations of the Underwriters that (A) such letters shall be accompanied
by a written explanation of the Company as to the significance thereof,
unless the Representatives deem such explanation unnecessary, and (B) such
changes, decreases or increases do not, in the sole judgment of the
Representatives, make it impractical or inadvisable to proceed with the
purchase and delivery of the Securities as contemplated by the
Registration Statement.
References to the Registration Statement, the Prospectus and any
Integrated Prospectus in this paragraph (d) with respect to either letter
referred to above shall include any amendment or supplement thereto at the
date of such letter.
(e) The Representatives shall have received a certificate,
dated the Closing Date, of the chief executive officer and the chief financial
or accounting officer of the Company to the effect that:
(i) the representations and warranties of the Company in
this Agreement are true and correct as if made on and as of the Closing
Date; the Registration Statement, as amended as of the Closing Date, does
not include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not misleading, and
the Prospectus or any Integrated Prospectus, as amended or supplemented as
of the Closing Date, does not include any untrue statement of a material
27
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; and the Company has performed all covenants and
agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment thereto and no
order directed at any document incorporated by reference in the
Registration Statement, the Prospectus or any Integrated Prospectus or any
amendment or supplement thereto has been issued, and no proceedings for
that purpose have been instituted or threatened or, to the best of the
Company's knowledge, are contemplated by the Commission; and
(iii) subsequent to the respective dates as of which
information is given in the Registration Statement, the Prospectus and any
Integrated Prospectus, neither the Company nor any of its subsidiaries has
sustained any material loss or interference with their respective
businesses or properties from fire, flood, hurricane, accident or other
calamity, whether or not covered by insurance, or from any labor dispute
or any legal or governmental proceeding, and there has not been any
material adverse change, or any development involving a prospective
material adverse change, in the condition (financial or otherwise),
management, business prospects, net worth or results of operations of the
Company or any of its subsidiaries, except in each case as described in or
contemplated by the Prospectus or any Integrated Prospectus (exclusive of
any amendment or supplement thereto).
(f) On or before the Closing Date, the Representatives and
counsel for the Underwriters shall have received such further certificates,
documents or other information as they may have reasonably requested from the
Company.
(g) [Intentionally omitted].
(h) If applicable, prior to the commencement of the offering
of the Securities, the Securities and any Underlying Securities shall have been
approved for listing on the New York Stock Exchange, subject to official notice
of issuance.
(i) No stop order suspending the effectiveness of the
PaineWebber Equity Trust REIT Series I Unit Investment Trust registration
statement (the file number of which is set forth in Schedule 1 hereto) (the "UIT
Registration Statement") or any post-effective amendment thereto and no order
directed at any document incorporated by reference in the UIT Registration
Statement shall have been issued, and no proceedings for that purpose shall have
been
28
instituted or threatened or, to the knowledge of the Representatives, shall be
contemplated by the Commission.
All opinions, certificates, letters and documents delivered pursuant
to this Agreement will comply with the provisions hereof only if they are
reasonably satisfactory in all material respects to the Representatives and
counsel for the Underwriters. The Company shall furnish to the Representatives
such conformed copies of such opinions, certificates, letters and documents in
such quantities as the Representatives and counsel for the Underwriters shall
reasonably request.
7. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold the Underwriter harmless, its directors, officers, employees
and agents and each person, if any, who controls it within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act from and against any and
all losses, claims, liabilities, expenses and damages (including, but not
limited to, any and all investigative, legal and other expenses reasonably
incurred in connection with, and any and all amounts paid in settlement of, any
action, suit or proceeding between any of the indemnified parties and any
indemnifying parties or between any indemnified party and any third party, or
otherwise, or any claim asserted), as and when incurred to which the
Underwriter, or any such person, 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, liabilities, expenses or damages
arise out of or are based on (i) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus, the
Registration Statement or the Prospectus or any amendment or supplement to the
Registration Statement or the Prospectus or in any documents filed under the
Exchange Act and deemed to be incorporated by reference into the Prospectus, or
in any application or other document executed by or on behalf of the Company or
based on written information furnished by or on behalf of the Company filed in
any jurisdiction in order to qualify the Shares under the securities or blue sky
laws thereof or filed with the Commission, (ii) the omission or alleged omission
to state in such document a material fact required to be stated in it or
necessary to make the statements in it, in the light of the circumstances under
which they were made, not misleading or (iii) any act or failure to act or any
alleged act or failure to act by the Underwriter in connection with, or relating
in any manner to, the Shares or the offering contemplated hereby, and which is
included as part of or referred to in any loss, claim, damage, liability or
action arising out of or based upon matters covered by clause (i) or (ii) above
(provided that the Company shall not be liable under this clause (iii) to the
extent it is finally judicially determined by a court of competent jurisdiction
that such loss, claim, damage, liability or action resulted directly from any
such acts or failures to act undertaken or omitted to be taken by the
Underwriter through their gross negligence or willful misconduct); provided that
the Company will not be liable to the extent that such loss, claim, liability,
expense or damage arises from the sale of the Shares in the public offering to
any
29
person and is based on an untrue statement or omission or alleged untrue
statement or omission made in reliance on and in conformity with information
relating to the Underwriter furnished in writing to the Company by the
Underwriter expressly for inclusion in the Registration Statement or the
Prospectus. This indemnity agreement will be in addition to any liability that
the Company might otherwise have.
(b) The Underwriter will indemnify and hold harmless the
Company, each person, if any, who controls the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, each director of the
Company and each officer of the Company who signed the Registration Statement to
the same extent as the foregoing indemnity from the Company to the Underwriter,
but only insofar as losses, claims, liabilities, expenses or damages (or actions
in respect thereof) arise out of or are based on any untrue statement or
omission or alleged untrue statement or omission made in reliance on and in
conformity with information relating to the Underwriter furnished in writing to
the Company by the Underwriter expressly for use in the Registration Statement
or the Prospectus. This indemnity will be in addition to any liability that the
Underwriter might otherwise have; provided, however, that in no case shall the
Underwriter be liable or responsible for any amount in excess of the
underwriting discounts and commissions received by the Underwriter.
(c) Any party that proposes to assert the right to be
indemnified under this Section 7 will, promptly after receipt of notice of
commencement of any action against such party in respect of which a claim is to
be made against an indemnifying party or parties under this Section 7, notify
each such indemnifying party of the commencement of such action, enclosing a
copy of all papers served, but the omission so to notify such indemnifying party
will not relieve it from any liability that it may have to any indemnified party
under the foregoing provisions of this Section 7 unless, and only to the extent
that, such omission results in the forfeiture of substantive rights or defenses
by the indemnifying party. If any such action is brought against any indemnified
party and it notifies the indemnifying party of its commencement, the
indemnifying party will be entitled to participate in and, to the extent that it
elects by delivering written notice to the indemnified party promptly after
receiving notice of the commencement of the action from the indemnified party,
jointly with any other indemnifying party similarly notified, to assume the
defense of the action, with counsel reasonably satisfactory to the indemnified
party, and after notice from the indemnifying party to the indemnified party of
its election to assume the defense, the indemnifying party will not be liable to
the indemnified party for any legal or other expenses except as provided below
and except for the reasonable costs of investigation subsequently incurred by
the indemnified party in connection with the defense. The indemnified party will
have the right to employ its own counsel in any such action, but the fees,
expenses and other charges of such counsel will be at the expense of such
indemnified party unless (i) the employment of counsel by the indemnified party
has been authorized in writing by the indemnifying party, (ii)
30
the indemnified party has reasonably concluded (based on advice of counsel) that
there may be legal defenses available to it or other indemnified parties that
are different from or in addition to those available to the indemnifying party,
(iii) a conflict or potential conflict exists (based on advice of counsel of the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (iv) the indemnifying
party has not in fact employed counsel to assume the defense of such action
within a reasonable time after receiving notice of the commencement of the
action, in each of which cases the reasonable fees, disbursements and other
charges of counsel will be at the expense of the indemnifying party or parties.
It is understood that the indemnifying party or parties shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable
for the reasonable fees, disbursements and other charges of more than one
separate counsel (in addition to local counsel) at any one time for all such
indemnified party or parties. All such fees, disbursements and other charges
will be reimbursed by the indemnifying party promptly as they are incurred. An
indemnifying party will not be liable for any settlement of any action or claim
effected without its written consent (which consent will not be unreasonably
withheld); provided, however, no indemnifying party shall, without the prior
written consent of each indemnified party, settle or compromise or consent to
the entry of any judgment in any pending or threatened claim, action or
proceeding relating to the matters contemplated by this Section 7 (whether or
not any indemnified party is a party thereto), unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising or that may arise out of such claim, action or
proceeding. Notwithstanding any other provision of this Section 7(c), if at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement effected
without its written consent if (i) such settlement is entered into more than 45
days after receipt by such indemnifying party of the aforesaid request, (ii)
such indemnifying party shall have received notice of the terms of such
settlement at least 30 days prior to such settlement being entered into and
(iii) such indemnifying party shall not have reimbursed such indemnified party
in accordance with such request prior to the date of such settlement.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in the foregoing
paragraphs of this Section 7 is applicable in accordance with its terms but for
any reason is held to be unavailable from the Company or the Underwriter, the
Company and the Underwriter will contribute to the total losses, claims,
liabilities, expenses and damages (including any investigative, legal and other
expenses reasonably incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claim asserted, but after
deducting any contributions received by the Company from person other than the
Underwriter, such as persons who control the Company within the meaning of the
Act, officers of the Company who signed the Registration
31
Statement and directors of the Company, who also may be liable for contribution)
to which the Company and the Underwriter may be subject in such proportion as
shall be appropriate to reflect the relative benefits received by the Company on
the one hand and the Underwriter on the other. The relative benefits received by
the Company on the one hand and the Underwriter on the other shall be deemed to
be in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by the Underwriter, in each case as set forth
in the table on the cover page of the Prospectus Supplement. If, but only if,
the allocation provided by the foregoing sentence is not permitted by applicable
law, the allocation of contribution shall be made in such proportion as is
appropriate to reflect not only the relative benefits referred to in the
foregoing sentence but also the relative fault of the Company, on the one hand,
and the Underwriter, on the other, with respect to the statement or omissions
which resulted in such loss, claims, liability, expense or damage, or action or
respect thereof, as well as any other relevant equitable considerations with
respect to such offering. Such relative fault shall be determined by reference
to whether the untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact relates to information supplied by
the Company or the Underwriter, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Underwriter agree that it would not
be just and equitable if contributions pursuant to this Section 7(d) were to be
determined by pro rata allocation or by any other method of allocation which
does not take into account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of the loss, claim,
liability, expense or damage, or action in respect thereof, referred to above in
this Section 7(d) shall be deemed to include, for purpose of this Section 7(d),
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7(d), the Underwriter shall not
be required to contribute any amount in excess of the underwriting discounts and
commissions received by the Underwriter and no person found guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) will be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7(d), any person who controls a
party to this Underwriting Agreement within the meaning of the Act will have the
same rights to contribution as that party, and each officer of the Company who
signed the Registration Statement will have the same rights to contribution as
the Company, subject in each case to the provisions hereof. Any party entitled
to contribution, promptly after receipt of notice of commencement of any action
against such party in respect of which a claim for contribution may be made
under this Section 7(d), will notify any such party or parties from whom
contribution may be sought, but the omission so to notify will not relieve the
party or parties from whom contribution may be sought from any other obligation
it or they may have under this Section 7(d). Except for a settlement entered
into pursuant to the last sentence of
32
Section 7(c) hereof, no party will be liable for contribution with respect to
any action or claim settled without its written consent (which consent will not
be unreasonably withheld).
(e) The indemnity and contribution agreements contained in
this Section 7 and the representations and warranties of the Company contained
in this Underwriting Agreement shall remain operative and in full force and
effect regardless of (i) any investigation made by or on behalf of the
Underwriter, (ii) acceptance of the Shares and payment therefor or (iii) any
termination of this Underwriting Agreement.
8. [Intentionally omitted].
9. Survival. The respective representations, warranties, agreements,
covenants, indemnities and other statements of the Company, its officers and the
several Underwriters set forth in this Agreement or made by or on behalf of
them, respectively, pursuant to this Agreement shall remain in full force and
effect, regardless of (i) any investigation made by or on behalf of the Company,
any of its officers or directors, any Underwriter or any controlling person
referred to in Section 7 hereof and (ii) delivery of and payment for the
Securities. The respective agreements, covenants, indemnities and other
statements set forth in Sections 5 and 7 hereof shall remain in full force and
effect, regardless of any termination or cancellation of this Agreement.
10. Termination. (a) This Agreement may be terminated with respect
to the Securities in the sole discretion of the Representatives by notice to the
Company given prior to the Closing Date in the event that the Company shall have
failed, refused or been unable to perform all obligations and satisfy all
conditions on its part to be performed or satisfied hereunder at or prior
thereto or, if at or prior to the Closing Date
(i) the Company or any of the Subsidiaries shall have,
in the sole judgment of the Representatives, sustained any material loss
or interference with their respective businesses or properties from fire,
flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any labor dispute or any legal or governmental
proceeding or there shall have been any material adverse change, or any
development involving a prospective material adverse change (including
without limitation a change in management or control of the Company, which
includes the termination of the employment of Xxxxxx X. Xxxx), in the
condition (financial or otherwise), business prospects, net worth or
results of operations of the Company and the Subsidiaries, except in each
case as described in or contemplated by the Prospectus (exclusive of any
amendment or supplement thereto);
33
(ii) the Company shall have failed, refused or been
unable, at or prior to the Closing Date, to perform any agreement on its
part to be performed hereunder;
(iii) any condition of the Underwriter's obligations
specified in "Conditions of the Underwriters' Obligations" hereof is not
fulfilled when due;
(iv) trading in the Common Stock shall have been
suspended by the Commission or the New York Stock Exchange or trading in
securities generally on the New York Stock Exchange shall have been
suspended or minimum or maximum prices for the Common Stock shall have
been established on such exchange;
(v) there shall have been 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);
(vi) a banking moratorium shall have been declared by
New York or United States authorities; or
(vii) there shall have been (A) an outbreak or
escalation of hostilities between the United States and any foreign power,
(B) an outbreak or escalation of any other insurrection or armed conflict
involving the United States or (C) any other calamity or crisis or
material adverse change in general economic, political or financial
conditions having an effect on the U.S. financial markets that, in the
sole judgment of the Representatives, makes it impractical or inadvisable
to (x) commence or continue with the offering of the units of the Trust to
the Public, or (y) enforce contracts for the sale of the Units of the
Trust.
(b) Termination of this Agreement pursuant to this Section 10
shall be without liability of any party to any other party except as provided in
Section 9 hereof. If the Underwriter elects to terminate this Agreement as
provided in this Section, the Company shall be notified promptly by the
Underwriter by telephone, telex or telecopy and confirmed by letter.
11. Information Supplied by Underwriters. The statements set forth
in the last paragraph on the front cover page of the Prospectus Supplement and
under the heading
34
"Underwriting" in the Prospectus Supplement (to the extent such statements
relate to the Underwriters) constitute the only information furnished by any
Underwriter through the Representatives to the Company for the purposes of
Sections 2(b) and 7(b) hereof. The Underwriters confirm that such statements (to
such extent) are correct.
12. Notices. All communications hereunder shall be in writing and,
if sent to any of the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission and confirmed in writing to PaineWebber Incorporated at
0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate
Finance Department; and if sent to the Company, shall be delivered or sent by
mail, telex or facsimile transmission and confirmed in writing to the Company at
00 Xxxxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxxxx, 00000, Attention: Xxxxxx X. Xxxx.
13. Successors. This Agreement shall inure to the benefit of and
shall be binding upon the several Underwriters, the Company and their respective
successors and legal representatives, and nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other person any legal
or equitable right, remedy or claim under or in respect of this Agreement, or
any provisions herein contained, this Agreement and all conditions and
provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person except that (i)
the indemnities of the Company contained in Section 7 of this Agreement shall
also be for the benefit of any person or persons who control any Underwriter
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
and (ii) the indemnities of the Underwriters contained in Section 7 of this
Agreement shall also be for the benefit of the directors of the Company, the
officers of the Company who have signed the Registration Statement as amended at
the date of this Agreement as specified in Schedule 1 hereto and any person or
persons who control the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act. No purchaser of Securities from any Underwriter
shall be deemed a successor because of such purchase.
14. Applicable Law. THE VALIDITY AND INTERPRETATION OF THIS
AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAWS.
15. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
35
If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute an agreement binding the Company and each
of the several Underwriters.
Very truly yours,
XXXX-XXXX REALTY CORPORATION
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Executive Vice President & General Counsel
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
PAINEWEBBER INCORPORATED
By: /s/ Xxxxx Xxxxxx
--------------------------
Authorized Signatory
SCHEDULE 1
DESCRIPTION OF SECURITIES; TERMS OF OFFERING
1. Registration Statement:
File No. 333-19101
2. Date of Underwriting Agreement:
May 27, 1998
3. Underwriters:
PaineWebber Incorporated
4. Title of Securities:
Common Stock, par value $.01 per share
5. Aggregate Number of Securities:
Common Stock, par value $.01 per share: 984,615 shares
6. Price to Public:
Common Stock, par value $.01 per share: $ 36.5625 per share
7. Purchase Price by Underwriters:
Common Stock, par value $.01 per share: $ 34.7344 per share
1
8. Specified Funds for Payment of Purchase Price:
Wire Transfer of Same Day Funds
9. Terms of Securities:
Preferred Stock: N/A
Warrants: N/A
Other Provisions: N/A
10. Lock-up Requirements:
None
11. Delivery of Securities:
PaineWebber Incorporated, 1285 Avenue of the Americas, New York, New York
on or about May 29, 1998
12. Pre-Closing Location:
Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx xx
May 28, 1998
13. Closing Location:
Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx xx
May 29, 1998
15. Stock Exchange Listing:
The Securities shall be approved for listing on the New York Stock
Exchange, subject to official notice of issuance, at or prior to the date
hereof.
16. UIT Registration Statement:
File No. 333-38255
2
17. Miscellaneous:
The Company is advised by you that the Underwriter proposes to
deposit the Shares with the trustee of the Trust, a registered unit investment
trust under the Investment Company Act of 1940, as amended, for which
PaineWebber Incorporated acts as sponsor and depositor, in exchange for units in
the Trust as soon after the execution and delivery hereof as in the judgement of
the Underwriter is advisable (and, if necessary, any post-effective amendment to
the Registration Statement).
3
SCHEDULE 2
UNDERWRITERS
Number of
Shares to
Underwriter be Purchased
----------- ------------
PaineWebber Incorporated
984,615
-------
Total 984,615
=======
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