Exhibit 4.10
THE XXXXX CORPORATION
SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT (this "AGREEMENT"), dated as of
April 27, 2001, is between The Xxxxx Corporation, a Delaware corporation (the
"COMPANY"), and iStar Preferred Holdings LLC, a Delaware limited liability
company ("BUYER").
RECITALS
A. The Company and Buyer are executing and delivering this Agreement in
reliance upon the exemption from securities registration afforded by Rule 506 of
Regulation D ("REGULATION D") as promulgated by the United States Securities and
Exchange Commission (the "SEC") under the Securities Act of 1933, as amended
(the "1933 ACT").
B. The Company has authorized the Series A Cumulative Convertible
Preferred Stock of the Company (the "SERIES A PREFERRED STOCK"), which shall be
convertible into shares of the Company's voting common stock, par value $0.01
per share (the "COMMON STOCK") (as converted, the "CONVERSION SHARES"), in
accordance with the terms of the Company's Certificate of Designations,
Preferences and Rights of the Series A Preferred Stock, substantially in the
form attached hereto as EXHIBIT A (the "CERTIFICATE OF DESIGNATIONS").
C. Buyer wishes to purchase, upon the terms and conditions stated in
this Agreement, initially 250,000 shares of Series A Preferred Stock (the
"INITIAL PREFERRED SHARES") and warrants exercisable in certain circumstances
set forth therein for shares of Common Stock (the Common Stock issuable
thereunder, the "INITIAL WARRANT SHARES" and such warrants, the "INITIAL
WARRANTS"), with the Initial Warrants to be substantially in the form attached
hereto as EXHIBIT B.
D. Subject to the terms and conditions set forth in this Agreement,
Buyer will be required to buy and the Company will be required to sell 500,000
shares of Series A Preferred Stock (the "MANDATORY PREFERRED SHARES") (the
Initial Preferred Shares and the Mandatory Preferred Shares collectively are
referred to in this Agreement as the "PREFERRED SHARES") and warrants
exercisable in certain circumstances set forth therein for shares of shares of
Common Stock (the Common Stock issuable thereunder, the "MANDATORY WARRANT
SHARES" and together with the Initial Warrant Shares, the "WARRANT SHARES;" and
such warrants the "MANDATORY WARRANTS" and collectively with the Initial
Warrants, the "WARRANTS"), with the Mandatory Warrants to be substantially in
the form attached hereto as EXHIBIT B.
E. Contemporaneously with the execution and delivery of this Agreement,
the parties hereto are executing and delivering a Registration Rights Agreement
substantially in the form attached hereto as EXHIBIT C (the "REGISTRATION RIGHTS
AGREEMENT") pursuant to which the Company has agreed to provide certain
registration rights under the 1933 Act and the rules and regulations promulgated
thereunder.
AGREEMENT
In consideration of the Recitals and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Company and the Buyer hereby agree as follows:
1. PURCHASE AND SALE OF PREFERRED SHARES.
a. PURCHASE OF PREFERRED SHARES. Subject to the satisfaction
of the conditions set forth in Sections 9(a) and 10(a) below, the Company shall
issue and sell to Buyer and Buyer agrees to purchase from the Company the
Initial Preferred Shares and the Initial Warrants at a single closing (the
"INITIAL CLOSING"). Subject to the satisfaction of the conditions set forth in
Sections 1(c), 9(b) and 10(b), the Company shall issue and sell to Buyer and
Buyer agrees to purchase from the Company all, and not less than all, of the
Mandatory Preferred Shares and the Mandatory Warrants at a single closing (the
"MANDATORY CLOSING"). (The Initial Closing and the Mandatory Closing
collectively are referred to in this Agreement as the "CLOSINGS"). The purchase
price (the "PURCHASE PRICE") of each Preferred Share at each of the Closings
shall be $[CONFIDENTIAL TREATMENT REQUESTED]*.
b. THE INITIAL CLOSING DATE. The date and time of the Initial
Closing (the "INITIAL CLOSING DATE") shall be 10:00 a.m. New York Time, within
three (3) Business Days following the date hereof, subject to the satisfaction
of the conditions to the Initial Closing set forth in Sections 9(a) and 10(a)
(or such later date as is mutually agreed to by the Company and Buyer). The
Initial Closing shall occur on the Initial Closing Date at the offices of Buyer,
1114 Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000. "BUSINESS
DAY" means any day other than Saturday, Sunday or other day on which commercial
banks in the City of New York are authorized or required by law to remain
closed.
c. THE MANDATORY CLOSING DATE. Subject to satisfaction of the
conditions to the Mandatory Closing set forth in Sections 9(b) and 10(b) and the
conditions set forth in this Section 1(c), the date and time of the Mandatory
Closing (the "MANDATORY CLOSING DATE") shall be 10:00 a.m. New York Time, on the
earlier of (i) the date set forth in the Mandatory Share Notice (as defined
below) (or such later date as is mutually agreed to by the Company and the
Buyer), and (ii) October 27, 2001 (the "FINAL CLOSING DATE"). The Company may
deliver written notice (the "MANDATORY SHARE NOTICE") to Buyer on a date which
is within five (5) months of the Initial Closing Date (the "MANDATORY SHARE
NOTICE DATE"). The Mandatory Share Notice shall set forth the date of the
Mandatory Closing Date which date shall be not less than 30 days after the
Mandatory Share Notice Date and in no event shall be later than October 27,
2001. Notwithstanding the foregoing, Buyer shall not be required to purchase the
Mandatory Preferred Shares unless each of the following conditions is satisfied:
(i) during the period beginning on the date of this Agreement and ending on and
including the Mandatory Closing Date, there shall not have occurred the
consummation of a Change of Control (as defined in Section 5) or a public
announcement of a pending Change of Control which has not been abandoned or
terminated; (ii) at all times during the period beginning on the date of this
Agreement and ending on and including the Mandatory Closing Date, the Common
Stock shall have been listed on The New York Stock Exchange, Inc. ("NYSE") or
The American Stock
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*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
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Exchange, Inc. ("AMEX") or designated for quotation on the Nasdaq National
Market ("NASDAQ") and shall not have been suspended from trading on such
exchanges nor shall delisting or suspension by such exchanges have been
threatened either (A) in writing by such exchanges or (B) by falling below the
minimum listing maintenance requirements of such exchanges; and (iii) during the
period beginning on the Initial Closing Date and ending on and including the
Mandatory Closing Date, the Company shall have delivered Conversion Shares upon
conversion of the Preferred Shares on a timely basis as set forth in the
Certificate of Designations and otherwise shall have been in compliance with and
shall not have breached any provision of the Transaction Documents (as defined
below) and the Certificate of Designations. The Mandatory Closing shall occur on
the Mandatory Closing Date at the offices of Buyer, 1114 Avenue of the Xxxxxxxx,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
d. FORM OF PAYMENT. On each of the Closing Dates, (i) Buyer
shall pay the Purchase Price to the Company for the Preferred Shares to be
issued and sold to Buyer at such Closing, by wire transfer of immediately
available funds in accordance with the Company's written wire instructions, less
any amount withheld for expenses or fees pursuant to Sections 4(h) and 4(i), and
(ii) the Company shall deliver to Buyer stock certificates (in the denominations
as Buyer shall request) (the "PREFERRED STOCK CERTIFICATES") representing such
number of the Preferred Shares which Buyer is then purchasing hereunder, duly
executed on behalf of the Company and registered in the name of Buyer.
2. BUYER'S REPRESENTATIONS AND WARRANTIES.
Buyer represents and warrants that:
a. INVESTMENT PURPOSE. Buyer (i) is acquiring the Preferred
Shares and the Warrants, (ii) upon conversion of the Preferred Shares, will
acquire the Conversion Shares then issuable and (iii) upon exercise of the
Warrants, will acquire the Warrant Shares issuable upon exercise thereof (the
Preferred Shares, the Conversion Shares, the Warrants and the Warrant Shares
collectively are referred to herein as the "SECURITIES"), for its own account
and not with a view towards, or for resale in connection with, the public sale
or distribution thereof, except pursuant to sales registered or exempted under
the 1933 Act; provided, however, that by making the representations herein,
Buyer does not agree to hold any of the Securities for any minimum or other
specific term and reserves the right to dispose of the Securities at any time in
accordance with or pursuant to a registration statement or an exemption under
the 1933 Act.
b. ACCREDITED INVESTOR STATUS. Buyer is an "accredited
investor" as that term is defined in Rule 501(a) of Regulation D.
c. RELIANCE ON EXEMPTIONS. Buyer understands that the
Securities are being offered and sold to it in reliance on specific exemptions
from the registration requirements of the United States federal and state
securities laws and that the Company is relying in part upon the truth and
accuracy of, and Buyer's compliance with, the representations, warranties,
agreements, acknowledgments and understandings of Buyer set forth herein in
order to determine the availability of such exemptions and the eligibility of
Buyer to acquire the Securities.
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d. INFORMATION. Buyer and its advisors and representatives, if
any, have been afforded the opportunity to ask questions of the Company.
(However, neither such inquiries nor any other due diligence investigations
conducted by Buyer or its advisors and representatives, if any, shall modify,
amend or affect Buyer's right to rely on the Company's representations and
warranties contained in Section 3 below.) Buyer understands that its investment
in the Securities involves a high degree of risk. Buyer has sought such
accounting, legal and tax advice as it has considered necessary to make an
informed investment decision with respect to its acquisition of the Securities.
e. NO GOVERNMENTAL REVIEW. Buyer understands that no United
States federal or state agency or any other government or governmental agency
has passed on or made any recommendation or endorsement of the Securities or the
fairness or suitability of the investment in the Securities nor have such
authorities passed upon or endorsed the merits of the offering of the
Securities.
f. LEGENDS. Buyer understands that the certificates or other
instruments representing the Preferred Shares and the Warrants and, as set forth
in the Registration Rights Agreement and in particular until such time as the
sale of the Conversion Shares and the Warrant Shares have been registered under
the 1933 Act as contemplated by the Registration Rights Agreement, the stock
certificates representing the Conversion Shares and the Warrant Shares, except
as set forth below, shall bear a restrictive legend in substantially the
following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT
FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
QUALIFICATION PURSUANT TO ANY APPLICABLE STATE SECURITIES LAWS OR (B)
AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT
REGISTRATION AND QUALIFICATION ARE NOT REQUIRED UNDER SAID ACT OR LAWS
OR (II) UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.
NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN, REPURCHASE
FACILITY, OR OTHER FINANCING ARRANGEMENT SECURED BY THE SECURITIES.
Buyer agrees to comply with the restrictions set forth in the legend above and
to require any transferee to so agree as a condition of transfer. The legend set
forth above shall be removed and the Company shall issue a certificate without
such legend to the holder of the Securities upon which it is stamped, if (i)
such Securities are registered for resale under the 1933 Act, (ii) in connection
with a sale transaction, such holder provides the Company with an opinion of
counsel, in a generally acceptable form, to the effect that a public sale,
assignment or transfer of the Securities may be made without registration under
the 1933 Act, or (iii) such holder provides
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the Company with reasonable assurances that the Securities can be sold pursuant
to Rule 144(k) promulgated under the 1933 Act (or any successor thereto).
Buyer understands that the certificates or other instruments
representing the Preferred Shares shall also bear a restrictive legend referring
to restrictions set forth in this Agreement and in the Company's Amended and
Restated Certificate of Incorporation, as amended, provided, however, if
restrictions described in a restrictive legend in the Company's Amended and
Restated Certificate of Incorporation, as amended, is inapplicable to the
Preferred Shares the certificates or other instruments representing the
Preferred Shares will also contain a notation to that effect.
g. AUTHORIZATION; ENFORCEMENT; VALIDITY. This Agreement and
the Registration Rights Agreement have been duly and validly authorized,
executed and delivered on behalf of Buyer and are valid and binding agreements
of Buyer enforceable against Buyer in accordance with their terms, subject as to
enforceability to general principles of equity and to applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation and other similar laws
relating to, or affecting generally, the enforcement of applicable creditors'
rights and remedies.
h. STATE OF DECISION-MAKING. The Buyer's receipt of the
Company's offer to purchase the Securities, the Buyer's decision to purchase the
Securities, and the Buyer's purchase of the Securities will all be made in the
State of New York.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
Except as set forth on the Schedules attached hereto, the
Company represents and warrants to the Buyer that:
a. ORGANIZATION AND QUALIFICATION. Each of the Company and the
Operating Partnership is a corporation or limited partnership, respectively,
duly organized and validly existing in good standing under the laws of the
jurisdiction in which it was incorporated or organized, and has the requisite
corporate or limited partnership power and authorization, respectively, to own
its properties and to carry on its business as now being conducted. Each of the
Company's Subsidiaries (as hereinafter defined) is a corporation, limited
partnership, limited liability company or business trust duly organized and
validly existing in good standing under the laws of the jurisdiction in which it
was incorporated or organized, and has the requisite corporate, limited
partnership, limited liability company or business trust power and authorization
to own its properties and to carry on its business as now being conducted except
where failure to be in good standing would not have a Material Adverse Effect.
Each of the Company and its Subsidiaries is duly qualified as a foreign
corporation, limited partnership, limited liability company or business trust to
do business and is in good standing in every jurisdiction in which its ownership
of property or the nature of the business conducted by it makes such
qualification necessary, except to the extent that the failure to be so
qualified or be in good standing would not have a Material Adverse Effect (as
hereinafter defined). For purposes of this Agreement, an entity shall be
considered a "SUBSIDIARY" of any other entity that directly or indirectly owns
or controls securities or other ownership interests that (i) permits such other
entity to elect a majority of the Board of Directors (or members of any similar
governing body)
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of the first entity, (ii) permits such other entity to direct the business and
policies of such first entity or (iii) confers a majority of the economic
interest of such first entity on such other entity (for avoidance of doubt, the
Operating Partnership (as hereinafter defined) is a Subsidiary of the Company).
For purposes of this Agreement, each Joint Venture shall be considered a
Subsidiary of the Company. As used in this Agreement, "JOINT VENTURE" means any
partnership, limited liability company or other entity in which the Company,
either directly or indirectly, owns an equity interest. As used in this
Agreement, "MATERIAL ADVERSE EFFECT" means any material adverse effect on the
business, properties, assets, operations, results of operations, condition
(financial or otherwise), or prospects of the Company and its Subsidiaries taken
as a whole, or on the transactions contemplated hereby or on the agreements and
instruments to be entered into in connection herewith, or on the authority or
ability of the Company to perform its obligations under the Transaction
Documents (as defined below) or the Certificate of Designations. The Company has
no Subsidiaries except as set forth on SCHEDULE 3(a)(i). Each Subsidiary of the
Company identified on SCHEDULE 3(a)(ii) hereinafter shall be referred to as a
"Significant Subsidiary". True and complete copies of the Charter Documents of
the Company and each Significant Subsidiary have been made available to Buyer or
Buyer's counsel. For purposes of this Agreement, "CHARTER DOCUMENTS" means (i)
with respect to a corporation, the articles or certificate of incorporation and
bylaws of such corporation, (ii) with respect to a limited partnership, the
certificate of limited partnership or similar state filing and partnership or
other similar agreement of such limited partnership and, (iii) with respect to a
limited liability company, the certificate of organization or other similar
state filing and operating or other similar agreement of such limited liability
company and (iv) with respect to any other entity, the organizational and other
documents of such entity comparable to the documents specified in (i) through
(iii). The Subsidiaries that are owned directly by the Company (and not through
the Operating Partnership) have de minimus business, revenue, income and assets.
b. AUTHORIZATION; ENFORCEMENT; VALIDITY. The Company has the
requisite corporate power and authority to enter into and perform its
obligations under this Agreement, the Ownership Limit Waiver (as defined in
Section 9), the Registration Rights Agreement, the Partnership Agreement
Amendment (as defined in Section 10), the Warrants and each of the other
agreements entered into by the parties hereto in connection with the
transactions contemplated by this Agreement (collectively, the "TRANSACTION
DOCUMENTS"), and to issue the Securities in accordance with the terms hereof and
thereof. The execution and delivery of the Transaction Documents by the Company
and the adoption, execution and filing of the Certificate of Designations by the
Company and the consummation by it of the transactions contemplated hereby and
thereby, including, but not limited to, the issuance of the Preferred Shares and
the Warrants and the reservation for issuance and the issuance of the Conversion
Shares and the Warrant Shares issuable upon conversion or exercise thereof, have
been duly authorized by the Company's Board of Directors (or a duly authorized
committee thereof) and no further consent or authorization is required by the
Company, its Board of Directors or its stockholders. The Transaction Documents
have been duly executed and delivered by the Company. The Transaction Documents
constitute the valid and binding obligations of the Company enforceable against
the Company in accordance with their terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally, the enforcement
of creditors' rights and remedies. The Certificate of Designations will have
been filed prior to the Initial Closing Date with the
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Secretary of State of the State of Delaware and will be in full force and
effect, enforceable against the Company in accordance with its terms and shall
not have been amended.
c. CAPITALIZATION. (i) As of the date hereof, the authorized
capital stock of the Company consists of (i) 100,000,000 shares of Common Stock,
of which as of the date hereof, approximately 24,117,130 shares are issued and
outstanding, no more than 7,000,000 shares are reserved for issuance pursuant to
the Company's stock option and purchase plans and no more than 16,332,517 shares
are issuable and reserved for issuance pursuant to securities (other than the
Preferred Shares and the Warrants) exercisable or exchangeable for, or
convertible into, shares of Common Stock and (ii) 50,000,000 shares of
non-voting common stock, par value $0.01 per share, of which as of the date
hereof, no shares are issued and outstanding and (iii) 20,000,000 shares of
preferred stock, of which as of the date hereof, no shares are issued and
outstanding. All of such outstanding shares have been, or upon issuance will be,
validly issued and are fully paid and nonassessable. Except as disclosed in
SCHEDULE 3(c)(i) or in the Company's Annual Report on Form 10-K for the year
ended December 31, 2000, as filed with the SEC (the "FORM 10-K") and except as
relate to less than $5,000,000 in interests or securities or agreements, either
individually or in the aggregate: (A) no shares of capital stock or other equity
interests of the Company or any Significant Subsidiary are subject to preemptive
rights or any other similar rights or any liens or encumbrances suffered or
permitted by the Company; (B) there are no outstanding debt securities that are
convertible into equity securities issued by the Company or any Significant
Subsidiary; (C) there are no outstanding options, warrants, scrip, rights to
subscribe to, calls or commitments of any character whatsoever relating to, or
securities or rights convertible into, any shares of capital stock or other
equity interests of the Company or any Significant Subsidiary, or contracts,
commitments, understandings or arrangements by which the Company or any
Significant Subsidiary is or may become bound to issue additional shares of
capital stock or other equity interests of the Company or any Significant
Subsidiary, or options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock or other equity interests of the
Company or any Significant Subsidiary to any party other than the Company or a
subsidiary of the Company whose financial results are consolidated with the
Company's in the Company's financial statements prepared in accordance with the
requirements of the 1934 Act and the regulations promulgated thereunder; (D)
there are no agreements or arrangements under which the Company or any
Significant Subsidiary is obligated to register the sale of any of their
securities under the 1933 Act (except the Registration Rights Agreement); (E)
there are no outstanding equity securities or instruments of the Company or any
Significant Subsidiary which contain any redemption or similar provisions, and
there are no contracts, commitments, understandings or arrangements by which the
Company or any Significant Subsidiary is or may become bound to redeem a
security of the Company or any Significant Subsidiary; (F) there are no
securities or instruments containing anti-dilution or similar provisions that
will be triggered by the issuance of the Securities as described in this
Agreement; and (G) neither the Company nor any Significant Subsidiary has any
stock appreciation rights or "phantom stock" plans or agreements or any similar
plan or agreement. The Ownership Limit (as defined in the Company's Amended and
Restated Certificate of Incorporation, as amended) has been increased to 9.225%,
and has not been rescinded, revoked, amended or changed.
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(ii) The Company is the sole general partner of The Xxxxx Limited
Partnership, a Delaware limited partnership (the "OPERATING PARTNERSHIP").
Information that is accurate (except to the extent that any inaccuracy would not
have a Material Adverse Effect) regarding the capitalization and the Company's
direct and indirect ownership of the Operating Partnership and each Subsidiary
of the Company is diagrammed and described in SCHEDULE 3(c)(ii), provided,
however, that information regarding ownership in SCHEDULE 3(c)(ii) may reflect
residual ownership interests after the payment of preferences that are not
reflected in such schedule.
(iii) All the shares of Common Stock held in escrow pursuant to the
Escrow Agreement, dated as of October 23, 1998, by and among the Operating
Partnership, Chelsea GCA Realty Partnership, LP and The First National Bank of
Chicago will be released to the Company upon payment by the Company of
approximately $4.6 million.
d. ISSUANCE OF SECURITIES. The Preferred Shares are duly
authorized and, upon issuance in accordance with the terms hereof, shall be (i)
validly issued, fully paid and non-assessable, (ii) free from all taxes, liens
and charges with respect to the issuance thereof and (iii) entitled to the
rights and preferences set forth in the Certificate of Designations. 6,851,866
shares of Common Stock (subject to adjustment pursuant to the Company's covenant
set forth in Section 4(f) below) have been duly authorized and reserved for
issuance upon conversion of the Preferred Shares or upon exercise of the
Warrants, as the case may be. Upon conversion or exercise in accordance with the
Certificate of Designations or the Warrants, as the case may be, the Conversion
Shares and the Warrant Shares will be validly issued, fully paid and
nonassessable and free from all taxes, liens and charges with respect to the
issue thereof, with the holders being entitled to all rights accorded to a
holder of Common Stock. Assuming the accuracy of the representations and
warranties of Buyer contained in Section 2 hereof, the issuance by the Company
of the Securities is exempt from registration under the 1933 Act.
e. NO CONFLICTS. Except as disclosed in SCHEDULE 3(e)(i), the
execution, delivery and performance of the Transaction Documents by the Company,
the performance by the Company of its obligations under the Certificate of
Designations and the consummation by the Company of the transactions
contemplated hereby and thereby (including, but not limited to, the reservation
for issuance and issuance of the Conversion Shares and the Warrant Shares) will
not (i) result in a violation of the Charter Documents of the Company or any
Significant Subsidiary; (ii) conflict with, or constitute a default (or an event
which with notice or lapse of time or both would become a default) under, or
give to others any rights of termination, amendment, acceleration or
cancellation of, any agreement, indenture or instrument to which the Company or
any of its Subsidiaries is a party and the termination, amendment, acceleration
or cancellation of which would reasonably be expected to result, either
individually or in the aggregate, in a Material Adverse Effect; (iii) result in
a violation of any law, rule, regulation, order, judgment or decree (including
federal and state securities laws and regulations and the rules and regulations
of the Principal Market (as hereinafter defined)) applicable to the Company or
any Significant Subsidiary or by which any property or asset of the Company or
any Significant Subsidiary is bound or affected. Except as disclosed in SCHEDULE
3(e)(ii), neither the Company nor any of its Subsidiaries is in violation of its
Charter Documents, except where any such violations and defaults could not
reasonably be expected to result, either individually or in
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the aggregate, in a Material Adverse Effect. Except as disclosed in SCHEDULE
3(e)(iii), neither the Company nor any of its Subsidiaries is in violation of
any term of or in default under any contract, agreement, mortgage, indebtedness,
indenture, instrument, judgment, decree or order or any statute, rule or
regulation applicable to the Company or its Subsidiaries, or by which any of
their property is bound, except where such violations and defaults could not
reasonably be expected to result, either individually or in the aggregate, in a
Material Adverse Effect. The business of the Company and its Subsidiaries is not
being conducted, and shall not be conducted, in violation of any law, ordinance
or regulation of any governmental entity, except where such violations could not
reasonably be expected to result, either individually or in the aggregate, in a
Material Adverse Effect. Except as specifically contemplated by this Agreement
and as required under the 1933 Act and applicable state securities laws, the
Company is not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court or governmental agency or any
regulatory or self-regulatory agency in order for it to execute, deliver or
perform any of its obligations under or contemplated by the Transaction
Documents or to perform its obligations under the Certificate of Designations,
in each case in accordance with the terms hereof or thereof. Except as disclosed
in SCHEDULE 3(e)(iv), all consents, authorizations, orders, waivers, filings and
registrations that the Company is required to obtain as described in the
preceding sentence have been obtained or effected on or prior to the date
hereof. The Company is not in violation of the listing requirements of the
Principal Market and has no actual knowledge of any facts which would reasonably
lead to delisting or suspension of the Common Stock by the Principal Market in
the foreseeable future.
f. SEC DOCUMENTS; FINANCIAL STATEMENTS. Since December 31,
1999, the Company has filed all reports, schedules, forms, statements and other
documents required to be filed by it with the SEC pursuant to the reporting
requirements of the Securities Exchange Act of 1934, as amended (the "1934 ACT")
(all of the foregoing filed prior to the date hereof and all exhibits included
therein and financial statements and schedules thereto and documents
incorporated by reference therein being hereinafter referred to as the "SEC
DOCUMENTS"). A complete list of the Company's SEC Documents is set forth on
SCHEDULE 3(f). As of their respective dates, the SEC Documents complied in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the SEC promulgated thereunder applicable to the SEC Documents.
None of the SEC Documents, at the time they were filed with the SEC, contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. As of their respective dates, the financial statements of the
Company included in the SEC Documents complied as to form in all material
respects with applicable accounting requirements and the rules and regulations
of the SEC with respect thereto. Such financial statements have been prepared in
accordance with United States generally accepted accounting principles,
consistently applied, during the periods involved ("GAAP") (except (i) as may be
otherwise indicated in such financial statements or the notes thereto or (ii) in
the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary statements) and fairly present in all
material respects the financial position of the Company as of the dates thereof
and the results of its operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments). No other information provided by or on behalf of the Company to
Buyer or its advisors or representatives, if any, that is not included in the
SEC Documents, at the
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time such other information was provided, contains any untrue statement of a
material fact or omits to state any material fact necessary in order to make the
statements therein, in the light of the circumstance under which they are or
were made, not misleading. The Company meets the requirements for use of Form
S-3 for registration of the resale of Registrable Securities (as defined in the
Registration Rights Agreement).
g. ABSENCE OF CERTAIN CHANGES. Except as disclosed in SCHEDULE
3(g) OR IN THE FORM 10-K, since December 31, 2000 there has been no material
adverse change and no material adverse development in the business, properties,
assets, operations, results of operations, condition (financial or otherwise) or
prospects of the Company and its Subsidiaries taken as a whole. Neither the
Company nor any Subsidiaries has taken any steps, nor do any of them currently
expect to take any steps, to seek protection pursuant to any bankruptcy law and
neither the Company nor any of its Subsidiaries have any knowledge or reason to
believe that its creditors intend to initiate involuntary bankruptcy proceedings
or any knowledge of any fact which would reasonably lead a creditor to do so.
h. ABSENCE OF LITIGATION. Except as disclosed in SCHEDULE
3(h)(i), there is no action, suit, proceeding, inquiry or investigation before
or by any court, public board, government agency, self-regulatory organization
or body pending or, to the knowledge of the Company or any of its Subsidiaries,
threatened in writing against or affecting the Company, the Common Stock or any
of the Subsidiaries, any of their respective properties, or any of the Company's
or the Subsidiaries' officers or directors in their capacities as such, except
such as involves less than $500,000, could not reasonably be expected to result
in a Material Adverse Effect or is fully covered by insurance (subject to
commercially reasonable deductibles or a commercially reasonable self-insurance
retention program). Except as set forth in SCHEDULE 3(h)(ii), to the knowledge
of the Company none of the directors or officers of the Company has been
involved in securities related litigation during the past five years.
i. ACKNOWLEDGMENT REGARDING BUYER'S PURCHASE OF PREFERRED
SHARES. The Company acknowledges and agrees that Buyer is acting solely in the
capacity of an arm's-length purchaser with respect to the Transaction Documents
and the Certificate of Designations and the transactions contemplated hereby and
thereby. The Company further acknowledges that Buyer is not acting as a
financial advisor or fiduciary of the Company (or in any similar capacity) with
respect to the Transaction Documents and the Certificate of Designations and the
transactions contemplated hereby and thereby and any advice given by Buyer or
any of its representatives or agents in connection with the Transaction
Documents and the Certificate of Designations and the transactions contemplated
hereby and thereby is merely incidental to Buyer's purchase of the Securities.
The Company further represents to Buyer that the Company's decision to enter
into the Transaction Documents has been based solely on the independent
evaluation by the Company and its representatives.
j. [Intentionally omitted.]
k. NO GENERAL SOLICITATION. Neither the Company nor any of its
affiliates, nor any person acting on its or their behalf, has engaged in any
form of general solicitation or general
10
advertising (within the meaning of Regulation D under the 0000 Xxx) in
connection with the offer or sale of the Securities.
l. NO INTEGRATED OFFERING. Neither the Company nor any of its
affiliates, nor any person acting on its or their behalf, has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security under circumstances that would require registration of any of
the Securities under the 1933 Act or cause this offering of the Securities to be
integrated with prior offerings by the Company for purposes of the 1933 Act or
any applicable stockholder approval provisions, including, but not limited to,
under the rules and regulations of any exchange or automated quotation system on
which any of the securities of the Company are listed or designated, nor will
the Company or any of its Subsidiaries take any action or steps that would
require registration of any of the Securities under the 1933 Act or cause the
offering of the Securities to be integrated with other offerings.
m. DILUTIVE EFFECT. The Company further acknowledges that its
obligation to issue Conversion Shares upon conversion of the Preferred Shares in
accordance with this Agreement and the Certificate of Designations and its
obligation to issue the Warrant Shares upon exercise of the Warrants in
accordance with this Agreement and the Warrants, is, in each case, absolute and
unconditional regardless of the dilutive effect that such issuance may have on
the ownership interests of other stockholders of the Company.
n. EMPLOYEE RELATIONS. Neither the Company nor any of its
Subsidiaries is involved in any union labor dispute nor, to the knowledge of the
Company or any of its Subsidiaries, is any such dispute threatened. None of the
Company's or its Subsidiaries' employees is a member of a union which relates to
such employee's relationship with the Company or any of its Subsidiaries,
neither the Company nor any of its Subsidiaries is a party to a collective
bargaining agreement, and the Company and its Subsidiaries believe that their
relations with their employees are good. Except as disclosed in SCHEDULE 3(n),
no executive officer (as defined in Rule 501(f) of the 0000 Xxx) has notified
the Company that such officer intends to leave the Company or otherwise
terminate such officer's employment with the Company. No executive officer, to
the knowledge of the Company and its Subsidiaries, is, or is now expected to be,
in violation of any material term of any employment contract, confidentiality,
disclosure or proprietary information agreement, non-competition agreement, or
any other contract or agreement or any restrictive covenant, and the continued
employment of each such executive officer does not subject the Company or any of
its Subsidiaries to any liability with respect to any of the foregoing matters.
o. INTELLECTUAL PROPERTY RIGHTS. Except as disclosed in
SCHEDULE 3(o)(i), the Company and its Subsidiaries own or possess adequate
rights or licenses to use all trademarks, trade names, service marks, service
xxxx registrations, service names, patents, patent rights, copyrights,
inventions, licenses, approvals, governmental authorizations, trade secrets and
other intellectual property rights necessary at their respective stages of
development to conduct their respective businesses as now conducted, except
where the failure to own or possess such rights could not reasonably be expected
to result, either individually or in the aggregate, in a Material Adverse
Effect. Except as set forth on SCHEDULE 3(o)(ii), none of the Company's
trademarks, trade names, service marks, service xxxx registrations, service
names, patents, patent rights,
11
copyrights, inventions, licenses, approvals, governmental authorizations, trade
secrets or other intellectual property rights have expired or terminated, or are
expected to expire or terminate within two years from the date of this
Agreement, except where such expiration or termination could not reasonably be
expected to result, either individually or in the aggregate, in a Material
Adverse Effect. The Company and its Subsidiaries do not have any knowledge of
any infringement by the Company or its Subsidiaries of trademarks, trade names,
service marks, service xxxx registrations, service names, patents, patent
rights, copyrights, inventions, licenses, trade secrets or other intellectual
property rights of others, or of any development of similar or identical trade
secrets or technical information by others and, except as set forth on SCHEDULE
3(o)(iii), there is no claim, action or proceeding being made or brought
against, or to the Company's knowledge, being threatened against, the Company or
its Subsidiaries regarding its trademarks, trade names, service marks, service
xxxx registrations, service names, patents, patent rights, copyrights,
inventions, licenses, trade secrets, or infringement of other intellectual
property rights; and the Company and its Subsidiaries are unaware of any facts
or circumstances which might give rise to any of the foregoing, except where any
of the foregoing could not reasonably be expected to result, either individually
or in the aggregate, in a Material Adverse Effect. The Company and its
Subsidiaries have taken reasonable security measures to protect the value and,
in the case of intellectual property whose value depends on secrecy and
confidentiality, the secrecy and confidentiality of all of their intellectual
properties.
p. ENVIRONMENTAL LAWS. Except as disclosed in SCHEDULE 3(p),
to the knowledge of the Company, the Company, its Subsidiaries and the
properties they own (i) are in compliance with any and all applicable foreign,
federal, state and local laws and regulations relating to the protection of
human health and safety, the environment or hazardous or toxic substances,
wastes, pollutants or contaminants ("ENVIRONMENTAL LAWS"), (ii) have received
all permits, licenses or other approvals required of them at their respective
stages of development under applicable Environmental Laws to conduct their
respective businesses as presently conducted and (iii) are in compliance with
all terms and conditions of any such permit, license or approval, except where,
in each of the foregoing cases (i)-(iii), the failure to so comply or receive
such permits could not reasonably be expected to result, either individually or
in the aggregate, in a Material Adverse Effect. True and complete copies of all
environmental reports with respect to the properties owned by the Company or any
of the Subsidiaries, which reports the Company or any of its Subsidiaries has in
its possession or control, have been provided to Buyer. Notwithstanding any
other provision of this Agreement, this Section 3(p) and Section 3(h) contain
the Company's sole and exclusive representations and warranties with respect to
environmental matters.
q. INSURANCE. The Company and each Significant Subsidiary are
insured by insurers of recognized financial responsibility against such losses
and risks and in such amounts as management of the Company believes to be
prudent and customary in the businesses in which the Company and each
Significant Subsidiary are engaged. Neither the Company nor any Significant
Subsidiary has been refused any insurance coverage sought or applied for and
neither the Company nor any such Subsidiary has any reason to believe that it
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 a Material
Adverse Effect.
12
r. REGULATORY PERMITS. Except for those the absence of which
could not reasonably be expected to result, either individually or in the
aggregate, in a Materially Adverse Effect, the Company and each Significant
Subsidiary possess all certificates, authorizations and permits issued by the
appropriate federal, state or foreign regulatory authorities necessary at their
respective stages of development to conduct their respective businesses as
presently conducted, and neither the Company nor any Significant Subsidiary has
received any notice of proceedings relating to the revocation or modification of
any such certificate, authorization or permit.
s. INTERNAL ACCOUNTING CONTROLS. The Company and each of its
Subsidiaries maintain a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in accordance
with management's general or specific authorizations, (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability, (iii) access to
assets is permitted only in accordance with management's general or specific
authorization and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
t. CERTAIN AGREEMENTS Neither the Company nor any of its
Subsidiaries is subject to any Charter Document, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation that could
reasonably be expected to have a Material Adverse Effect that has not been
disclosed in writing to Buyer as such. Neither the Company nor any Significant
Subsidiary is a party to any contract or agreement that could reasonably be
expected to have a Material Adverse Effect that has not been disclosed in
writing to Buyer. Except as disclosed in SCHEDULE 3(t)(i) or in the Form 10-K,
neither the Company nor any of its Subsidiaries have indebtedness to third
parties, either individually or in the aggregate, in excess of $1.0 million.
True and complete copies of the agreements pursuant to which such indebtedness
has been incurred and the ancillary documents thereto have been delivered to or
made available to Buyer or its counsel. Except as set forth in SCHEDULE
3(t)(ii), there are currently no defaults in the payment of principal or
interest on any such indebtedness, no payments thereunder have been deferred or
extended beyond their stated maturity, and as of March 31, 2001, the Company was
not in default of any of its covenants or obligations contained in the Loan
Documents (as hereinafter defined). Except as described in SCHEDULE 3(t)(iii),
neither the Company nor any of its Subsidiaries is a party to, or bound by, any
agreement or arrangement which prohibits (absent a BONA FIDE default under such
agreement or arrangement) the distribution of cash by such entity to its equity
holders for the payment of a distribution or dividend on the Preferred Shares,
where such prohibition could reasonably be expected to have a Material Adverse
Effect or a material adverse effect on the ability of the Company to make
required payments on the Preferred Shares.
u. TAX STATUS. The Company and each of its Subsidiaries, (i)
has timely made or filed, after giving effect to any permitted extensions, all
federal and state income and all other tax returns, reports and declarations
required by any jurisdiction to which it is subject, (ii) has timely paid, after
giving effect to any permitted extensions, all taxes and other governmental
assessments and charges that are material in amount, shown or determined to be
due on such returns, reports and declarations, except those being contested in
good faith and for which the Company has made appropriate reserves for on its
books, and (iii) has set aside on its books provisions reasonably adequate for
the payment of all taxes for periods subsequent to the periods
13
to which such returns, reports or declarations (referred to in clause (i) above)
apply and for all periods prior to the date hereof for which any return, report
or declaration has not been filed. There are no unpaid taxes in any material
amount claimed to be due by the taxing authority of any jurisdiction, and the
Company knows of no basis for any such claim. Except as set forth on SCHEDULE
3(U), each of the Subsidiaries of the Company is a pass-through entity for
federal income tax purposes. The Company has been at all times commencing with
its taxable year ending December 31, 1994 a real estate investment trust within
the meaning of Section 856 of the Internal Revenue Code of 1986, as amended (the
Internal Revenue Code of 1986, as amended, is hereinafter referred to as the
"CODE") and the regulations promulgated (whether final or temporary) or proposed
under the Code (the "REGULATIONS").
v. TRANSACTIONS WITH AFFILIATES. Except as set forth on
SCHEDULE 3(v) and in the SEC Documents filed at least ten days prior to the date
hereof, and other than the grant of stock options disclosed on SCHEDULE 3(c)(i),
none of the officers or directors of the Company or any of its Subsidiaries is
presently a party to any transaction with the Company or any of its Subsidiaries
(other than for services as officers and directors) that would reasonably be
expected to have a Material Adverse Effect, including any contract, agreement or
other arrangement providing for the furnishing of services to or by, providing
for rental of real or personal property to or from, or otherwise requiring
payments to or from any such officer or director or, to the knowledge of the
Company, any corporation, partnership, trust or other entity in which any such
officer or director has a substantial interest or is an officer, director,
trustee or partner.
w. APPLICATION OF TAKEOVER PROTECTIONS. The Company and its
Board of Directors have taken all necessary action, if any, in order to render
inapplicable any control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or other similar
anti-takeover provision under the Certificate of Incorporation or the laws of
the state of its incorporation and any other state which is or could become
applicable to Buyer as a result of the transactions contemplated by this
Agreement, including, but not limited to, the Company's issuance of the
Securities and Buyer's ownership of the Securities (including the exercise of
any conversion or purchase rights under any such Securities).
x. FOREIGN CORRUPT PRACTICES. To the Company's knowledge,
neither the Company, nor any of its Subsidiaries, nor any director, officer,
agent, employee or other person acting on behalf of the Company or any of its
Subsidiaries has, in the course of its actions for, or on behalf of, the
Company, (i) used any corporate funds for any unlawful contribution, gift,
entertainment or other unlawful expenses relating to political activity; (ii)
made any direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds; (iii) violated or is in
violation of any provision of the Foreign Corrupt Practices Act of 1977, as
amended; or (iv) made any unlawful bribe, rebate, payoff, influence payment,
kickback or other unlawful payment to any foreign or domestic government
official or employee.
For purposes of the representations and warranties set forth in this Section 3,
all information contained in the narrative of and in the financial statements
included in the Form 10-K and in the SEC Documents filed at least ten days prior
to the date hereof, excluding the exhibits thereto or incorporated by reference
therein, shall be deemed to have been scheduled or disclosed in writing to
Buyer, as applicable.
14
4. COVENANTS.
a. BEST EFFORTS. Each party shall use its best efforts to
timely satisfy each of the conditions to be satisfied by it as provided in
Sections 9 and 10 of this Agreement.
b. FORM D AND BLUE SKY. The Company agrees to file a Form D
with respect to the Securities as required under Regulation D and to provide a
copy thereof to Buyer promptly after such filing. The Company shall, on or
before each of the Closings, take such action as the Company shall reasonably
determine is necessary in order to obtain an exemption for or to qualify the
Securities for sale to Buyer at each of the Closings pursuant to this Agreement
under applicable securities or "Blue Sky" laws of the states of the United
States, and shall provide evidence of any such action so taken to Buyer on or
prior to the Closing Dates. The Company shall make all filings and reports
relating to the offer and sale of the Securities required under applicable
securities or "Blue Sky" laws of the states of the United States following each
of the Closing Dates.
c. REPORTING STATUS. Until the earlier of (i) the date which
is five and one-half (5 1/2) years from the Mandatory Closing Date, (ii) such
time as no Conversion Shares or Warrant Shares are held by Investors or are
issuable to Investors upon the conversion of Preferred Shares or Warrants held
by Investors and (iii) one month after the date on which no Preferred Shares
remain issued and outstanding (the "REPORTING PERIOD"), the Company shall file
all reports required to be filed with the SEC pursuant to the 1934 Act, and the
Company shall not terminate its status as an issuer required to file reports
under the 1934 Act even if the 1934 Act or the rules and regulations thereunder
would otherwise permit such termination. Notwithstanding the foregoing, upon a
Change of Control (and, if any holder(s) of Preferred Shares exercise a Put
Option in connection therewith, upon the payment in full of the Put Option
Exercise Price due by the Company to such holder(s)), the requirements of this
Section 4(c) shall terminate.
d. USE OF PROCEEDS. The Company will use the proceeds from the
sale of the Preferred Shares as a capital contribution to the Operating
Partnership which will use the capital contribution to fund development
activities and pay the costs associated with the transactions contemplated by
this Agreement and for general corporate and partnership purposes.
e. FINANCIAL AND OTHER INFORMATION. As long as any Preferred
Shares remain outstanding, the Company agrees to provide to Buyer and each Major
Holder who prior to the time any information is required to be provided agrees
in writing addressed to the Company and sent to the Company as set forth in
Section 12(f) hereof to be bound by the restrictions set forth in the last two
sentences of this Section 4(e) as if such Major Holder were Buyer:
(i) AUDITED ANNUAL FINANCIAL STATEMENTS. Within
ninety-five (95) days after the end of each fiscal year of the Company,
a consolidated balance sheet of the Company and its subsidiaries, as of
the end of such year, and the related consolidated statements of
operations and cash flow for such fiscal year, prepared in accordance
with the requirements of the 1934 Act and the regulations promulgated
thereunder.
15
(ii) UNAUDITED QUARTERLY FINANCIAL STATEMENTS. Within
fifty (50) days after the end of each of the first three fiscal
quarters of the Company, an unaudited consolidated balance sheet of the
Company and its subsidiaries as of the end of such period, and the
related unaudited consolidated statement of income for such period and
for the current fiscal year to date and statement of cash flows for the
current fiscal year to date, prepared in accordance with the
requirements of the 1934 Act and the regulations promulgated
thereunder.
(iii) SENIOR MANAGEMENT REPORTING PACKAGE AND JOINT
VENTURE FINANCIAL STATEMENTS. Copies of each Senior Management
Reporting Package made available or distributed to the senior
management of the Company promptly upon the availability or preparation
thereof and if the Senior Management Reporting Package shall, after the
date hereof, cease to be prepared or if the information regarding the
Joint Ventures contained therein is materially changed, then reports
providing substantially similar information regarding the Joint
Ventures, at times substantially similar to the preparation and
distribution of the Senior Management Reporting Package. In any event,
the Company shall promptly provide the audited balance sheet as of each
such fiscal year (if such audit is prepared), and the related statement
of operations and cashflows for such year for each Joint Venture. For
purposes of this Section 4, "JOINT VENTURES" means those entities set
forth on SCHEDULE (4)(e)(iv) attached hereto.
(iv) SIGNIFICANT CHANGES. Timely notification of
significant changes, except where notification of such changes would,
if provided to a Person not subject to a confidentiality agreement,
require the Company to publicly disclose the information contained in
such notification under Regulation FD under the 1934 Act, and REIT
Status concerns, including, but not limited to, prompt notification
upon the Company's chief financial officer, chief executive officer,
president or tax director receiving any report, allegation or
determination from any attorney or accountant engaged by the Company or
any agent of the Internal Revenue Service or of any state department of
revenue that, there may have been, has been, or reasonably likely will
be a Failure by the Company to Maintain REIT Status or having actual
knowledge of facts and legal principles that create a reasonable
possibility that there may have been, has been or reasonably likely
will be a Failure by the Company to Maintain REIT Status and upon the
submission of any proposal for consideration by the Company's Board of
Directors or stockholders for the termination of the Company's REIT
Status.
Buyer agrees not to disclose or use for any improper purpose any confidential,
proprietary or non-public information disclosed in materials sent to Buyer
pursuant to the requirements of this Section 4(e) and Buyer agrees that it shall
not trade in the Company's securities so long as it is in possession of
material, non-public information. Buyer may disclose information referred to in
the preceding sentence to its Affiliates, lenders (including potential lenders)
and transferees (including potential transferees) of Preferred Shares and
Warrants only after providing the Company with the written agreement of such
Affiliate, lender or transferee that such Affiliate, lender or transferee will
not disclose or use for any improper purpose any confidential, proprietary or
non-public information disclosed in such information and shall not trade in the
Company's securities so long as it is in possession of material, non-public
information; PROVIDED,
16
HOWEVER, that information may be disclosed to a lender or potential lender in
the absence of such written agreement if there is included in any loan or credit
agreement between the Buyer and such lender confidentiality provisions
substantially similar to those set forth above regarding information provided to
such lender or the Buyer enters into a confidentiality agreement with such
lender or potential lender including confidentiality provisions substantially
similar to those set forth above regarding information provided to such lender.
f. RESERVATION OF SHARES. The Company shall use its best
efforts to at all times have authorized, and reserved for the purpose of
issuance, no less than the aggregate maximum number of shares of Common Stock
that may be issuable upon conversion of all outstanding Preferred Shares and
exercise of all outstanding or issuable Warrants (without regard to any
limitations on exercises other than limitations on exercise to the extent that
Preferred Shares are outstanding).
g. LISTING. The Company shall promptly use its best efforts to
secure the listing of all of the Registrable Securities (as defined in the
Registration Rights Agreement) upon each national securities exchange and
automated quotation system, if any, upon which shares of Common Stock are then
listed (subject to official notice of issuance) and shall maintain, so long as
any other shares of Common Stock shall be so listed, such listing of all
Registrable Securities from time to time issuable under the terms of the
Transaction Documents and the Certificate of Designations. The Company shall
maintain the Common Stock's authorization for quotation on Nasdaq or listed on
NYSE or AMEX (as applicable, the "PRINCIPAL MARKET"). Neither the Company nor
any of its Subsidiaries shall take any action which would be reasonably expected
to result in the delisting or suspension of the Common Stock from the Principal
Market. The Company shall promptly, and in any event within five (5) Business
Days, provide to each Major Holder copies of any notices it receives from the
Principal Market regarding the continued eligibility of the Common Stock for
listing on such automated quotation system or securities exchange. The Company
shall pay all fees and expenses in connection with satisfying its obligations
under this Section 4(g).
h. EXPENSES. At each of the Closings, the Company shall
reimburse Buyer for its reasonable expenses (including attorneys' fees and
expenses) in due diligence and negotiating and preparing the Transaction
Documents and consummating the transactions contemplated thereby, which amount
shall be withheld by Buyer from the Purchase Price to be paid by it at each
Closing. Buyer acknowledges receipt of $100,000 as an advance against such
expenses (the "EXPENSE ADVANCE"). The Expense Advance and any expense reimbursed
to Buyer hereunder, to the extent they are not loan processing costs, shall be
treated for federal income tax purposes as a reduction in the "issue price" for
the Preferred Shares, with the "issue price" of each Preferred Share being
reduced by an amount equal to the total expense reimbursed hereunder divided by
the total number of Preferred Shares outstanding following the Final Closing
Date.
i. Intentionally Omitted.
j. FILING OF FORM 8-K. On or before the sixth (6th) Business
Day following the Initial Closing Date the Company shall file a Form 8-K with
the SEC describing the terms of
17
the transactions contemplated by the Transaction Documents in the form required
by the 1934 Act. On or before the sixth (6th) Business Day following the
Mandatory Closing Date, the Company shall file a Form 8-K with the SEC
describing the transaction consummated on such date.
k. INSPECTION. As long as any Preferred Shares remain
outstanding, upon thirty (30) days' written notice to the Company, each
Substantial Holder and its agents and representatives shall have reasonable
access to the Company's and each of its Subsidiaries' properties (and the
Company shall cause its representatives to arrange and conduct such property
visits), contracts, books and records, and other documents and data of the
Company and each such Subsidiary, and each such holder and its agents and
representatives may make copies of all such contracts, books and records, and
other existing documents and data. Buyer hereby agrees, and each Substantial
Holder, as a condition precedent to being permitted to have such access, shall
agree in writing addressed to the Company, not to disclose or use for any
improper purpose any confidential, proprietary or non-public information it
learns as a result of the access provided pursuant to this Section 4(k) and each
Substantial Holder agrees that it shall not trade in the Company's securities so
long as it is in possession of material, non-public information. Buyer and each
Substantial Holder may disclose information referred to in the preceding
sentence to their respective Affiliates, lenders (including potential lenders)
and transferees (including potential transferees) of Preferred Shares and
Warrants only after providing the Company with the written agreement of such
Affiliate, lender or transferee that such Affiliate, lender or transferee will
not disclose or use for any improper purpose any confidential, proprietary or
non-public information disclosed in such information and shall not trade in the
Company's securities so long as it is in possession of material, non-public
information; PROVIDED, HOWEVER, that information may be disclosed to a lender or
potential lender in the absence of such written agreement if either there is in
included in any loan or credit agreement between the Buyer or Substantial Holder
and such lender confidentiality provisions substantially similar to those set
forth above regarding information provided to such lender or the Buyer or
Substantial Holder enters into a confidentiality agreement with such lender or
potential lender including confidentiality provisions substantially similar to
those set forth above regarding information provided to such lender.
l. CAPITAL AND SURPLUS; SPECIAL RESERVES. The Company agrees
that the capital of the Company (as such term is used in Section 154 of the
General Corporation Law of Delaware) in respect of the Preferred Shares shall be
equal to the aggregate par value of such Preferred Shares and that it shall not
increase the capital of the Company with respect to any shares of the Company's
capital stock at any time on or after the date of this Agreement. The Company
also agrees that it shall not create any special reserves under Section 171 of
the General Corporation Law of the State of Delaware, as amended (the "DGCL"),
without the prior written consent of each Substantial Holder. So long as any
Preferred Shares remain outstanding, the Company shall not account for as
surplus or transfer to or otherwise allocate to the Company's surplus account
for purposes of the DGCL any of the capital represented by the Preferred Shares,
including, but not limited to, for the purpose of reducing any of its capital
stock as contemplated by Section 244 of the DGCL.
18
m. ACCESS TO BOARD OF DIRECTORS/MANAGEMENT. As long as any
Preferred Shares remain outstanding, simultaneously with delivery to the
relevant party, the Company shall provide each Substantial Holder with copies of
all materials sent or distributed to members of the Company's Board of Directors
or its audit, executive, or compensation committee, including, but not limited
to, board books and draft minutes of meetings; PROVIDED, HOWEVER, that the
Company shall not be required to provide any Substantial Holder with materials
that are subject to any attorney-client privilege, and may omit such materials
or redact portions of materials sent to Substantial Holders in order to maintain
the confidentiality of such information (other than any materials or information
that could affect, or relates to, Buyer's status as a REIT). In addition, the
Company agrees that, upon reasonable notice, each Substantial Holder and its
agents and its representative shall be entitled to meet with the Company's
management up to four times in each twelve month period and at any time after a
Regular Dividend (as defined in the Certificate of Designations) payment is
missed or an Event of Noncompliance (as hereinafter defined) exists. Buyer
hereby agrees, and each Substantial Holder, as a condition precedent to the
Company's obligation to provide such materials or meetings, shall agree in
writing addressed to the Company, not to disclose or use for any improper
purpose any confidential, proprietary or non-public information disclosed in
such materials and/or meetings and agrees that it shall not trade in the
Company's securities so long as it is in possession of material, non-public
information.
n. FINANCIAL COVENANTS. The Company agrees to cause the
financial covenants to be complied with that are set forth in Sections 9.10,
9.11(b) and 9.12 (including such adjustments made over time pursuant to the
terms of such covenants as in effect on the date hereof) (other than paragraphs
(c) and (h) of Section 9.12), of that certain Credit Agreement, dated as of June
8, 2000 (the "TERM LOAN AGREEMENT"), among the Operating Partnership, the
Lenders (as defined therein), Bayerische Hypo-Und Vereinsbank, AG and
Commerzbank AG, as such covenants are in effect on the date hereof (regardless
of whether or not (i) any of the Lenders waives compliance with such covenants,
(ii) the Lenders agree to any modification of such covenants or (iii) all
obligations under the Term Loan Agreement have been satisfied). Notwithstanding
the foregoing, for purposes of this Section, under Section 9.10 of the Term Loan
Agreement, the percentage of the Capitalization Value (as defined in the Term
Loan Agreement) that the Total Adjusted Outstanding Indebtedness (as defined in
the Term Loan Agreement) shall not exceed shall be 63%. Terms used in Sections
9.10, 9.11(b) and 9.12 of the Term Loan Agreement that are defined in the Term
Loan Agreement shall have the meanings specified in the Term Loan Agreement as
in effect as of the date hereof.
o. INSURANCE. The Company agrees to maintain, and cause each
of its Subsidiaries to maintain, with financially sound and reputable insurers
rated A- or above by A.M. Best, insurance with respect to its assets and
business and the assets and business of its Subsidiaries against loss or damage
of the kinds customarily insured against by similarly situated entities of
established reputation engaged in the same or similar businesses, in adequate
amounts, and at the request of any Substantial Holder shall furnish such holder
with evidence of the same.
p. OPERATIONS. The Company agrees to continue to operate
substantially in accordance with past practices using reasonable business
judgment in the conduct of its affairs including, but not limited to, such
matters as the preservation of its corporate existence, the payment of taxes and
other obligations, and compliance with law.
19
q. DISTRIBUTIONS. Subject to the terms of the Operating
Partnership Agreement as in effect on the date hereof, any amendments to the
Operating Partnership Agreement after the date hereof that are made in
accordance with the terms of this Agreement and the other Transaction Documents
and any restrictions of applicable law, the Company agrees to cause the
Operating Partnership to make cash distributions to the Company to enable the
Company to make distributions to the holders of Preferred Shares as provided in
this Agreement, the other Transaction Documents and the Certificate of
Designations.
r. PRINCIPAL BUSINESS. The principal business of the Company
and its Subsidiaries taken as a whole shall continue to be the ownership,
development and operation of retail or entertainment shopping centers and
businesses incidental thereto (including the master leasing and operation of
food courts within retail or entertainment shopping centers operated by the
Company or any of its Subsidiaries), it being understood by and acceptable to
Buyer that the Company contemplates the construction of a hotel and an office
complex as part of Meadowland Xxxxx and may undertake similar ancillary projects
in connection with other retail or entertainment mall developments of the
Company or its subsidiaries. The Company shall not, directly or indirectly,
enter into or conduct any business other than in connection with the ownership,
acquisition and disposition of interests as general partner or a limited partner
and the management of the business of the Operating Partnership and such
activities as are incidental thereto. The assets of the Company shall be limited
to partnership interests in the Operating Partnership; PROVIDED THAT the Company
shall be permitted to hold such bank accounts or similar instruments or accounts
in its name as it deems necessary to carry out its responsibilities and purposes
as general partner of the Operating Partnership under the Limited Partnership
Agreement of the Operating Partnership (PROVIDED THAT accounts held on behalf of
the Operating Partnership to permit the Company to carry out its
responsibilities under the Limited Partnership Agreement of the Operating
Partnership shall be considered to belong to the Operating Partnership and the
interest earned thereon shall be applied for the benefit of the Operating
Partnership); and provided further that, the Company shall be permitted to
acquire, directly or through a "qualified REIT subsidiary" or limited liability
company, up to a one percent interest in any partnership or limited liability
company at least ninety-nine percent of the equity of which is owned by the
Operating Partnership.
s. NEGATIVE COVENANTS. Without the prior written approval of
the holder(s) of a majority of the Preferred Shares, which approval shall not be
unreasonably withheld, delayed or conditioned with respect to activities that in
the reasonable judgment of such holders would not have an adverse effect on the
holders of the Series A Preferred Shares, the Company shall not:
(i) MERGERS. Merge or consolidate with any Person or
sell all or substantially all its assets, or permit the Operating
Partnership to merge or consolidate with any entity or sell all or
substantially all its assets, provided no such approval shall be
necessary if such merger or consolidation shall not cause a Change of
Control to occur (for the purpose of this Section 4(s)(i) only,
substituting [CONFIDENTIAL TREATMENT REQUESTED]*% for [CONFIDENTIAL
TREATMENT REQUESTED]*% in the definition thereof).
----------------
*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
20
(ii) CHARTER AMENDMENTS. Make any amendment to the
Certificate of Incorporation or By-Laws or the Charter Documents of the
Company or the Operating Partnership (including to Exhibit 4 to the
Partnership Agreement Amendment) in a manner that could adversely
affect the powers, preferences or the rights of the Preferred Shares or
the Series A Preferred Partnership Units (including any amendment,
revision, revocation or other change to the Ownership Limit that
reduces it below 9.2%) or make any amendment to the Certificate of
Incorporation or By-Laws or the Charter Documents of any wholly-owned
Subsidiary of the Company in a manner that could adversely affect the
powers, preferences or the rights of the Preferred Shares, or make any
material amendment to the Charter Documents of any other Subsidiary of
the Company in a manner that could adversely affect the powers,
preferences or the rights of the Preferred Shares. Without limiting the
foregoing, the reduction of the Ownership Limit below 9.2% or the
imposition of any capital stock transfer restriction shall be deemed to
have an adverse effect on the holders of the Series A Preferred Shares.
(iii) BANKRUPTCY. File for, or otherwise acquiesce in
seeking, protection under any bankruptcy, insolvency or other similar
common law, state, local or federal protection statute or regulation,
or permit any of its Subsidiaries to file for, or otherwise acquiesce
in seeking, protection under any bankruptcy, insolvency or other
similar state, local or federal protection statute or regulation.
(iv) LOAN DOCUMENTS. Amend, or permit the amendment
of, the terms of the Loan Documents (as hereinafter defined) in any
material respect (including, but not limited to, amendments effected in
connection with work-outs or restructurings of any of the foregoing) in
any manner, or enter into any refinancing of any of the Loan Documents
or any credit, loan or other agreement, which amendment, refinancing or
credit, loan or other agreement would prohibit payment of dividends or
any other payment due on the Preferred Shares or to a holder or holders
of Preferred Shares or otherwise could reasonably be expected to
materially adversely affect the powers, preferences or rights of the
Preferred Shares. As used herein, "LOAN DOCUMENTS" means (i) the Term
Loan Agreement and the other agreements and documents entered into in
connection therewith), (ii) the Amended and Restated Revolving Credit
Agreement, dated as of June 8, 2000, among the Operating Partnership,
the Lenders (as defined therein), Bayerische Hypo-Und Vereinsbank, AG
and Commerzbank AG and the agreements and documents entered into in
connection therewith and (iii) the agreements set forth on SCHEDULE
4(s)(iv). For avoidance of doubt, amendments to the Loan Documents that
only change commitment amounts of the lenders or interest rates on, or
maturity dates of, the indebtedness thereunder do not require the
consent of the holders of Preferred Shares under this subsection.
(v) ISSUANCES. Authorize, issue or enter into any
agreement providing for the issuance (contingent or otherwise) of, or
permit the Operating Partnership or any other Subsidiary of the Company
to authorize, issue or enter into any agreement providing for the
issuance of, any equity rights (such as profit participation) or equity
securities (or any securities, commitments or agreements convertible
into or exchangeable for equity rights or equity securities) with
rights, including, but not limited
21
to, rights with respect to dividends, liquidation preference or other
repurchase rights, senior to or pari passu with the Preferred Shares,
except for equity rights or equity securities proceeds from the sale of
which are used within five (5) days of the receipt thereof to pay the
Call Option Exercise Price for the Preferred Shares to the extent
permitted by Section 6 hereof. For avoidance of doubt, a Subsidiary of
the Company may issue preferred interests in such Subsidiary so long as
such preferred interests are not convertible into or exchangeable for
either (i) securities issued by the Company which are pari passu or
senior to the Preferred Shares or (ii) interests in the Operating
Partnership which are pari passu or senior to the Series A Preferred
Partnership Units.
(vi) elect not to continue to, comply with all
requirements necessary to be treated as a "real estate investment
trust" within the meaning of the Code and the Regulations.
(vii) make any distribution on its capital stock to
any stockholder of the Company other than in cash or with respect to a
shareholder rights plan, except as set forth in SCHEDULE 4(s)(vii).
(viii) make any distribution on its capital stock of
any kind (including cash) to any stockholder of the Company at any time
that a Put Option (as hereinafter defined) or a Call Option (as
hereinafter defined) has been exercised in whole or in part and the put
price or call price, as applicable, has become due and has not been
paid in full in cash by the Company.
(ix) withdraw as the general partner of the Operating
Partnership or admit any other person or entity as a general partner of
the Operating Partnership.
(x) take any action, or permit any Subsidiary or
other Affiliate of the Company to take any action, which would result
in (A) less than 75% of the assets of the Company qualifying as "real
estate assets" under Section 856(c)(4)(A) of the Code or the
Regulations promulgated thereunder, or more than 25% of its assets to
consist of assets described in Section 856(c)(4)(B) of the Code or the
Regulations promulgated thereunder, (B) less than 75% of the gross
income of the Company qualifying as income described in Section
856(c)(3) of the Code and the Regulations promulgated thereunder and
less than 95% of such gross income qualifying as income described in
Section 856(c)(2) of the Code or the Regulations promulgated thereunder
or any material amount of the Company's income to be income that the
Company believes, acting in good faith, would be reasonably likely to
constitute income from a "prohibited transaction" as defined in Section
857(b)(6)(B)(iii) of the Code and the Regulations promulgated
thereunder, (C) any material amount of the Company's assets to be
property described in Section 1221(a)(1) of the Code (other than
"foreclosure property" as defined in Section 856(e) of the Code), or
(D) the Company ceasing to be a REIT; provided, however, that if as a
result of a change in the law after the date hereof a violation of a
provision contained in (A), (B) or (C) above would not cause a Failure
by the Company to Maintain REIT
22
Status or a Material Adverse Effect, then the Company shall no longer
be required to comply with such changed provision.
(xi) LIQUIDATE. Liquidate, dissolve or effect a
recapitalization or reorganization of the Company or the Operating
Partnership in any form of transaction.
(xii) RESTRICTED PROPERTY DEBT. Encumber all or any
portion of the Restricted Properties (as defined in Section7) with
indebtedness (not including accounts payable but including any
indebtedness (whether or not secured) of the Subsidiaries which own, or
own an equity interest in, any of the Restricted Properties) or permit
any Subsidiary of the Company that owns any of the Restricted
Properties, or owns an equity interest in any of the Restricted
Properties, to guarantee in any manner the obligations of any Person,
where the aggregate principal amount of such indebtedness plus the
principal amount of the obligations so guaranteed does not exceed
$[CONFIDENTIAL TREATMENT REQUESTED]* (the "Restricted Property Debt")
and any refinancing of such debt and guarantees in excess of the
Restricted Property Debt is hereinafter referred to as a ("Restricted
Property Refinancing"), and with respect to each Restricted Property
individually, not in excess of such amount set forth in
Schedule 4(s)(xii)(A). In addition, an aggregate amount not to exceed
$[CONFIDENTIAL TREATMENT REQUESTED]* of capitalized leases, equipment
financing and similar debt may be incurred, with such debt incurred
by any Subsidiaries relating to the Restricted Properties not to
exceed one-third of the amount of such aggregate amount. The debt
associated with FoodBrand, L.L.C. shall not be considered for the
purposes of determining the foregoing debt levels. Notwithstanding
the foregoing, Restricted Property Debt shall not include the
obligations of the Company and its Subsidiaries arising out of that
certain letter of credit issued by the Bank (as hereinafter defined)
for the benefit of Sunrise Special Tax District #1 (or any
replacements of such letter of credit).
t. COMPETITORS. Notwithstanding any provision to the contrary
herein, (i) no holder of Preferred Shares who is a Competitor (as hereinafter
defined) shall be entitled to receive any information from the Company that has
not been publicly disclosed, (ii) the Company shall not be obligated to provide
any such information to any Competitor, and (iii) no such Competitor shall be
entitled to exercise any inspection rights provided for herein (including,
without limitation, in the definition of "Failure by the Company to Maintain
REIT Status" in Section 5(f)). For purposes of this Section, "COMPETITOR" shall
mean any Person whose primary business activity is developing, owning or
operating retail or entertainment shopping centers, provided, however, that
"Competitor" does not include any insurance company, financial institution,
pension, profit-sharing, employee benefit and retirement plan, individual
retirement account, mutual fund and institutional investment fund whose
investors consist primarily of institutions and high net worth individuals, in
each case regardless of their investment in retail or entertainment shopping
centers. In addition, in no circumstance shall the Buyer be included in the
definition of "Competitor."
u. DEFINITIONS. For purposes of this Agreement:
"MAJOR HOLDER" shall mean a holder of at least one hundred
thousand (100,000) shares of the Preferred Shares issued and outstanding.
----------------
*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
23
"SUBSTANTIAL HOLDER" shall mean a holder of at least two
hundred fifty thousand (250,000) shares of Preferred Shares issued and
outstanding.
Unless otherwise specified herein, the provisions of this Section 4 shall
terminate at such time as none of the Preferred Shares remain outstanding.
5. PUT OPTION.
(a) GRANT. The Company hereby grants to each holder of
Preferred Shares a right and option (each, a "PUT OPTION") to require the
Company to purchase, and the Company hereby agrees to purchase, all or any
portion of the Preferred Shares held by such holder, subject to the terms and
conditions described below.
(B) EXERCISE. The Put Option may be exercised by any holder of Preferred Shares
at any time and from time to time (i) after a Change in Control (as hereinafter
defined), (ii) after the Failure by the Company to Maintain REIT Status (as
defined below) for any reason, (iii) after the fifth anniversary of the Initial
Closing Date or (iv) after the occurrence of those events of Event of
Noncompliance set forth in paragraphs (a), (b) (but only if the Event of
Noncompliance under paragraph (b) arises in connection with a breach of Sections
4(c), 4(g), 4(r), 4(s) (except 4(s)(xii)), hereunder or in connection with a
material breach of the material provisions of Sections 5, 6 or 7 hereunder), and
(e) of the definition thereof below (each, a "MATERIAL EVENT OF NONCOMPLIANCE").
The Company shall notify the holders of Preferred Shares (i) at least thirty
(30) days prior to the completion of, or, if later, promptly upon the Company's
learning of, any proposed or consummated Change of Control, (ii) immediately
upon the Company's obtaining knowledge of any Failure by the Company to Maintain
REIT Status and (iii) promptly after the Company's obtaining knowledge of the
occurrence of a Material Event of Noncompliance. Such notice shall include, as
applicable, a reasonably detailed description of the Change in Control,
including the identity of the other party or parties, the consideration received
and the closing date or a detailed description of the facts and/or events
resulting in the Failure by the Company to Maintain REIT Status or the Material
Event of Noncompliance, as the case may be. Upon notice to the Company (a "PUT
OPTION EXERCISE NOTICE"), each holder of Preferred Shares shall have the right
to require the Company to purchase all or any portion of its Preferred Shares
(i) thirty (30) days after receipt from the Company of notice of the
consummation of a Change of Control, (ii) as soon as practicable, but in any
event no less than twenty (20) days, after providing written notice to the
Company in the event of a Failure by the Company to Maintain REIT Status or a
Material Event of Noncompliance, and (iii) at any time after the fifth
anniversary of the issuance date upon ninety (90) days advance notice. Each Put
Option Exercise Notice, in order to be valid, must specify an account to which
funds may be wire transferred.
(c) PUT OPTION EXERCISE PRICE. For each Preferred Share
purchased by the Company pursuant to this Section 5, the price per share to be
paid by the Company for each Preferred Share which is the subject of the Put
Option (the "PUT OPTION EXERCISE PRICE") shall be an amount equal to:
(i) if a Change in Control occurs on or prior to the
first anniversary of the Initial Closing, the greater of (A)
$[CONFIDENTIAL TREATMENT REQUESTED]* plus all accumulated and
accrued but unpaid
----------------
*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
24
dividends through the date of repurchase by the Company and (B) the
Standard Put Payment (as defined below);
(ii) if a Change in Control occurs after the first
anniversary of the Initial Closing but on or prior to the second
anniversary of the Initial Closing, the greater of (A) $[CONFIDENTIAL
TREATMENT REQUESTED]* plus all accumulated and accrued but unpaid
dividends through the date of repurchase by the Company and (B) the
Standard Put Payment;
(iii) if a Change in Control Transaction occurs after
the second anniversary of the Initial Closing but on or prior to the
third anniversary of the Initial Closing, the greater of (A)
$[CONFIDENTIAL TREATMENT REQUESTED]* plus all accumulated and accrued
but unpaid dividends through the date of repurchase by the Company
and (B) the Standard Put Payment;
(iv) if (A) a Change in Control occurs after the
third anniversary of the Initial Closing, (B) there occurs a Failure by
the Company to Maintain REIT Status that was not the result of a
willful and intentional, and not inadvertent, act of the Company
(provided such failure is not a breach of either Section 4(s)(vi) or
(x) in either of which case subsection (v) below shall govern), or (C)
at any time after the fifth anniversary of the Initial Closing, the
Standard Put Payment;
(v) if a Material Event of Noncompliance has
occurred, an amount equal to (i) the Standard Put Payment, computed as
of the date the Material Event of Noncompliance has occurred, plus (ii)
an amount that, assuming a purchase by the holder of a Preferred Share
of a Preferred Share on the date of the occurrence of the Material
Event of Noncompliance for a price equal to the Standard Put Payment
and taking into account both the actual payment of the Standard Put
Payment on the date of repurchase by the Company and all Regular
Dividends paid subsequent to the date the Material Event of
Noncompliance occurs, would result in an internal rate of return to
such holder from the date of the occurrence of the Material Event of
Noncompliance through the date of repurchase by the Company of
[CONFIDENTIAL TREATMENT REQUESTED]*% per annum; or
(vi) In addition, if the event giving rise to the
exercise of the Put Option is a Material Event of Noncompliance or a
Failure by the Company to Maintain REIT Status, and in such case was
the result of the willful and intentional, and not inadvertent, act of
the Company, then the Put Option Exercise Price in such event shall be
an amount equal to the Increased Put Payment (as defined below).
(d) PUT OPTION PAYMENT. If a holder of Preferred Shares
exercises a Put Option by timely delivery of a Put Option Exercise Notice, the
Company shall deliver to such holder, by wire transfer of immediately available
funds to an account specified by such holder in the Put Option Exercise Notice,
the amount of the Put Option Exercise Price for each Preferred Share to be
repurchased by the Company on the date specified in the Put Option Exercise
Notice, so long as such date is consistent with the provisions of Section 5(b)
(the "PUT OPTION CLOSING DATE"). Upon delivery of the payment of the Put Option
Exercise Price as provided herein, such Preferred Shares shall no longer be
deemed outstanding, all rights whatsoever with respect to such Preferred Shares
shall terminate and the certificates, if any, evidencing the shares shall be
delivered to the Company for cancellation. In the event that the Put Option is
not honored or the
----------------
*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
25
Put Option Exercise Price is not paid in full on the Put Option Closing Date for
any reason and such default is not cured within 90 days (except in connection
with a Change of Control or the Failure of the Company to Maintain REIT Status,
in either of which cases no grace period shall apply), then the Put Option
Exercise Price for each Preferred Share which is the subject of the Put Option
shall be increased to the Increased Put Payment (if such amount is greater than
the Put Option Exercise Price otherwise payable).
(e) REDEMPTION PREMIUM. Buyer and the Company agree that,
because the Buyer may require that the Company redeem the Preferred Shares at a
redemption price in excess of its issue price, the entire amount of the excess
may constitute an unreasonable redemption premium that will be treated as a
constructive distribution for United States federal income tax purposes. Buyer
generally would take this constructive distribution into account each year in
the same amount as original issue discount would be taken into account if the
preferred stock were treated as a debt security for United States federal income
tax purposes, and account for the distribution as a dividend to the extent so
required under Section 305 of the Code.
(f) DEFINITIONS. For purposes of this Agreement:
[CONFIDENTIAL TREATMENT REQUESTED]*
----------------
*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
26
[CONFIDENTIAL TREATMENT REQUESTED]*
----------------
*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
27
A "FAILURE BY THE COMPANY TO MAINTAIN REIT STATUS"
shall be deemed to have occurred upon (i) the issuance by the Internal
Revenue Service of a Notice of Deficiency or its counterpart alleging
that the Company no longer qualifies as a REIT; (ii) the issuance by
any accounting firm or law firm engaged by the Company of a written
opinion or other written conclusion that the Company has failed to
comply with the requirements for REIT Status in any period, or that a
substantial likelihood exists that the Company has failed to comply
with the requirements for REIT Status in any period; (iii) the lapse of
ninety (90) days after the Buyer and/or a Substantial Holder informs
the Company in writing, based upon a reasonable investigation conducted
by or on behalf of the Company, Buyer or a Substantial Holder and with
an explanation for such conclusion, that a substantial likelihood
exists that the Company has failed to comply with the requirements for
REIT Status without receipt by the Buyer and/or the Substantial Holder,
as applicable, of a written opinion of a nationally recognized
accounting firm, based on the conduct of a due diligence exercise
constituting review of the Company's books and records by such
accounting firm (and not based on merely statistical sampling), that
the Company has complied, and continues to comply with, the
requirements for REIT Status; or (iv) the failure by the Company to
permit Buyer or a Substantial Holder who is not a Competitor to
investigate upon three (3) Business Days' notice whether the Company
continues to comply with the requirements for REIT Status, after Buyer
or such Substantial Holder has indicated a reasonable belief, based
upon advice of such Buyer's or Substantial Holder's legal counsel or
accountants, that an issue exists with respect to the Company's REIT
Status, unless a Comfort Letter (as hereinafter defined) is delivered
prior to the termination of such three (3) Business Day period. If a
Comfort Letter is delivered after such three (3) Business Day period,
any investigation commenced prior to such time shall cease. "Comfort
Letter" shall mean a written opinion of a nationally recognized
accounting firm addressed to the Buyer and the applicable Substantial
Holder that, upon an appropriate due diligence investigation by such
accounting firm, the facts and circumstances giving rise to the
reasonable belief of the Buyer or such Substantial Holder do not
threaten the REIT Status of the Company. An investigation by the Buyer
or a Substantial Holder who is not a Competitor for this purpose shall
include the Company allowing immediate access to its books and records
and the books and records of its Subsidiaries (including all tax
returns, reports and declarations and all communications from
governmental authorities), and promptly affording the opportunity
28
to interview in person officers, employees, and agents of the Company
without such persons refusing to provide information based upon a claim
of privilege or confidentiality or for use for any other reason.
"INCREASED PUT PAYMENT" means, with respect to any
Preferred Share, (i) the amount necessary to generate the Base Internal
Rate of Return (as defined in the Certificate of Designations but
computed substituting [CONFIDENTIAL TREATMENT REQUESTED]*% for
[CONFIDENTIAL TREATMENT REQUESTED]*% in such definition), plus
(ii) the amount of all accumulated and accrued but unpaid dividends
on such Preferred Share (other than Regular Dividends) computed as
of the date of repurchase by the Company. Notwithstanding the
foregoing or any other provision of this Agreement or the
Certificate Designations to the contrary, the Increased Put Payment
with respect to any outstanding Preferred Share computed as of a
particular date shall be in the same amount as the Increased Put
Payment with respect to each other outstanding Preferred Share
computed as of such date. For avoidance of doubt, if the Increased
Put Payment becomes payable pursuant to this Agreement and is not
paid for any reason prior to any voluntary or involuntary
liquidation, dissolution or winding up of the Company (a
"Liquidation"), the excess of the amount of the Increased Put
Payment over the amount payable under Section 1 of the Certificate
of Designations in a Liquidation shall be paid with respect to the
Preferred Shares in addition to the amount payable under such
Section 1 prior to any payment or distribution on any Junior
Securities (as defined in the Certificate of Designations). A sample
calculation of the Base Internal Rate of Return is attached hereto
as EXHIBIT H.
"PERSON" means an individual, a partnership, a
corporation, a limited liability company, an association, a joint stock
company, a trust, a joint venture, an unincorporated organization or a
governmental entity or any department, agency or political subdivision
thereof.
"REIT STATUS" means meeting the requirements of, and
maintaining the election for being, a "real estate investment trust"
within the meaning of the Code and the Regulations.
"STANDARD PUT PAYMENT" means, with respect to any
Preferred Share, (i) the amount necessary to generate the Base Internal
Rate of Return (as defined in the Certificate of Designations), plus
(ii) the amount of all accumulated and accrued but unpaid dividends on
such Preferred Share (other than Regular Dividends), each computed as
of the date of repurchase by the Company. Notwithstanding the foregoing
or any other provision of this Agreement or the Certificate
Designations to the contrary, the Standard Put Payment with respect to
any outstanding Preferred Share computed as of a particular date shall
be in the same amount as the Standard Put Payment with respect to each
other outstanding Preferred Share computed as of such date.
6. CALL OPTION.
X. XXXXX. Buyer hereby grants to the Company a right and
option (a "CALL OPTION") to require each holder of Preferred Shares to sell, and
each holder of Preferred Shares
----------------
*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
29
hereby agrees to sell all, but not less than all, the Preferred Shares held by
such holder, subject to the terms and conditions described below.
B. EXERCISE. The Call Option may be exercised by the Company
at any time after the first anniversary of the Initial Closing Date, provided,
however, in the event of a Kan Am Redemption (as hereinafter defined) prior to
the first anniversary of the Initial Closing Date, simultaneously with, and as a
condition to, the consummation of such Kan Am Redemption, the Company has the
right and obligation to exercise the Call Option. The Company shall notify the
holders of Preferred Shares at least forty-five (45) days prior to exercise of
the Call Option.
C. CALL OPTION EXERCISE PRICE. Unless the Ownership Waiver
Limit Agreement provides otherwise, for each Preferred Share purchased by the
Company pursuant to this Section 6 the price per share for the Call Option (the
"CALL OPTION EXERCISE PRICE") is payable in cash and in an amount equal to: (i)
if the Call Option is being exercised prior to the first anniversary of the
Initial Closing Date in connection with a Kan Am Redemption, the greater of (A)
$[CONFIDENTIAL TREATMENT REQUESTED]* plus all accumulated and accrued but
unpaid dividends through the date of repurchase by the Company and (B) the
Early Call Repurchase Price (as hereinafter as herein defined, (ii) if the
Call Option is being exercised on any day after the first anniversary of the
Initial Closing Date but prior to the date which is thirty (30) months after
the Mandatory Closing Date (the "EARLY CALL PERIOD"), $100 plus the Yield
Maintenance Premium (as defined below) (the "EARLY CALL REPURCHASE PRICE")
and (iii) if the Call Option is being exercised on any day on or after 30
months from the Mandatory Closing Date, the Standard Call Payment. A sample
calculation of an exercise of a Call Option by the Company at the end of the
16th month after Initial Closing is attached hereto as EXHIBIT K.
D. CALL OPTION PAYMENT. If the Company exercises a Call Option
by timely delivery of a Call Option Exercise Notice, the holders of Preferred
Shares shall deliver certificates, if any, evidencing the shares subject to such
notice against delivery by the Company of the Call Option Exercise Price for
each Preferred Share by wire transfer of immediately available funds to an
account specified by such holder not later than 45 days following the date on
which the Call Option Exercise Notice is given to the holders of Preferred
Shares (the "CALL OPTION CLOSING DATE"). Upon delivery of the payment of the
Call Option Exercise Price as provided herein, such Preferred Shares shall no
longer be deemed outstanding, and all rights whatsoever with respect to such
Preferred Shares (except the right of the holders of Preferred Shares to receive
the Call Option Exercise Price without interest) shall terminate. In the event
that the Call Option Exercise Price is not paid in full on the Call Option
Closing Date, or within three (3) days of such date if the Company made a good
faith effort to deliver the Call Option Exercise Price on such date, then the
Call Exercise Price shall be the Increased Call Payment. If one or more holders
of Preferred Shares do not specify an account for payment of the Call Option
Exercise Price, the Company shall deposit on the Call Option Closing Date the
Call Option Exercise Price for all of such holders' Preferred Shares with a bank
or trust corporation having aggregate capital and surplus in excess of
$100,000,000 as a trust fund for the benefit of such respective holders who did
not specify an account, with irrevocable instructions and authority to the bank
or trust corporation to pay the Call Option Exercise Price for such shares to
their respective holders on or after the Call Option Closing Date upon receipt
of such holders' certificates representing the Preferred Shares. As of the Call
Option Closing Date, the deposit
30
shall constitute full payment of the Preferred Shares to their holders, and from
and after the Call Option Closing Date such shares shall be deemed to be no
longer outstanding, and the holders thereof shall cease to be stockholders with
respect to such shares and shall have no rights with respect thereto except the
rights to receive from the bank or trust corporation payment of the Call Option
Exercise Price of the shares, without interest, upon surrender of their
certificates therefor.
e. DEFINITIONS. For purposes of this Agreement:
"INCREASED CALL PAYMENT" means, with respect to any
Preferred Share, (i) the amount necessary to generate the Base Internal
Rate of Return (as defined in the Certificate of Designations, but
computed substituting [CONFIDENTIAL TREATMENT REQUESTED]*% for
[CONFIDENTIAL TREATMENT REQUESTED]*% in such definition) plus (ii)
the amount of all accumulated and accrued but unpaid dividends on such
Preferred Shares (other than Regular Dividends), computed as of the
date of repurchase by the Company. Notwithstanding the foregoing or any
other provision of this Agreement or the Certificate Designations to
the contrary, the Increased Call Payment with respect to any
outstanding Preferred Share computed as of a particular date shall be
in the same amount as the Increased Call Payment with respect to each
other outstanding Preferred Share computed as of such date. For
avoidance of doubt, if the Increased Call Payment becomes payable
pursuant to this Agreement and is not paid for any reason prior to a
Liquidation, the excess of the amount of the Increased Call Payment
over the amount payable under Section 1 of the Certificate of
Designations in a Liquidation shall be paid with respect to the
Preferred Shares in addition to the amount payable under such Section 1
prior to any payment or distribution on any Junior Securities (as
defined in the Certificate of Designations).
"KAN AM REDEMPTION" means the acquisition by the
Company or the Operating Partnership of capital stock of the Company or
Partnership Interests held by the Kan Am Group in an amount in excess
of $175,000,000.
"STANDARD CALL PAYMENT" means, with respect to any
Preferred Share, (i) the amount necessary to generate the Base Internal
Rate of Return (as defined in the Certificate of Designations) plus
(ii) the amount of all accumulated and accrued but unpaid dividends on
such Preferred Share (other than Regular Dividends), each computed as
of the date of repurchase by the Company. Notwithstanding the foregoing
or any other provision of this Agreement or the Certificate
Designations to the contrary, the Standard Call Payment with respect to
any outstanding Preferred Share computed as of a particular date shall
be in the same amount as the Standard Call Payment with respect to each
other outstanding Preferred Share computed as of such date. Sample
calculations of the Standard Call Payment in connection with the
exercise by the Company of Call Options in the month that is
thirty-nine (39) months and forty eight (48) months after the Initial
Closing Date are attached hereto as EXHIBIT I.
"YIELD MAINTENANCE PREMIUM" means for each Preferred
Share for which such premium must be determined, the positive excess,
if any, as of the date of the repurchase of such Preferred Share by the
Company of (a) the Yield Maintenance Cash Flows (calculated as
described below) with respect to such Preferred Share discounted to
----------------
*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
31
the date of repurchase by the Company of such Preferred Share at
[CONFIDENTIAL TREATMENT REQUESTED]*. The "YIELD MAINTENANCE CASH
FLOWS" with respect to a Preferred Share is the monthly cash flows
otherwise due to the holder of such Preferred Share for which the
Yield Maintenance Premium is being calculated, including all Regular
Dividends and the Standard Call Payment (other than amounts required
by clause (ii) of the definition of Standard Call Payment) that
would be payable to the holder of such Preferred Share on the
assumption that all Regular Dividends are paid in full in cash on
each Dividend Reference Date and that the Standard Call Payment was
paid in cash in full on the first day after the end of the Early
Call Period. Notwithstanding the foregoing or any other provision of
this Agreement or the Certificate Designations to the contrary, the
Yield Maintenance Premium with respect to any outstanding Preferred
Share computed as of a particular date shall be in the same amount
as the Yield Maintenance Premium with respect to each other
outstanding Preferred Share computed as of such date. A sample
calculation of the Yield Maintenance Payment is attached hereto as
EXHIBIT J.
7. SALE OF RESTRICTED PROPERTIES.
a. Except in compliance with this Section 7, the Company will
not sell, or allow any of its Subsidiaries to sell, directly or indirectly, all
or any portion of any of the properties described on SCHEDULE 7 attached hereto
(each such property is referred to as a "RESTRICTED PROPERTY" and collectively
such properties are referred to as "RESTRICTED PROPERTIES") (whether the sale is
of a fee interest in a Restricted Property or an equity interest in a Restricted
Property). Prior to the sale of all or any portion of a Restricted Property or
the granting of consent by the holders of a majority of the Preferred Shares
pursuant to Section 4(s)(xii) to a Restricted Property Refinancing (such a sale
or a Restricted Property Refinancing is referred to herein as a "RESTRICTED
PROPERTY TRANSACTION"), the Company shall provide each holder of Preferred
Shares with a notice and certification as follows:
(i) a copy of the proposed closing statement for the
Restricted Property Transaction (and, promptly after the closing of a
Restricted Property Transaction, the Company shall deliver to each
holder of Preferred Shares, a copy of the final closing statement,
purchase or financing contract, and title company disbursement
statement relating to the Restricted Property Transaction certified as
true, correct and complete by an authorized representative of the
Company with knowledge of the Restricted Property Transaction.)
(ii) a certification that no Event of Noncompliance shall have
occurred and be continuing, and no Event of Noncompliance shall occur
as a result of the consummation of the Restricted Property Transaction.
b. The Company shall have the right to sell, or allow its
Subsidiaries to sell, directly or indirectly, all or any portion of the
Restricted Properties, and, subject to obtaining the
----------------
*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
32
prior written consent of the holders of a majority of the Preferred Shares in
accordance with Section 4(s)(xii), the Company and its Subsidiaries shall have
the right to consummate a Restricted Property Refinancing, subject to the right
of each holder of Preferred Shares to require the Company to purchase a portion
(which may be as many as all) of such holder's Preferred Shares concurrently
with the closing of such Restricted Property Transaction with a portion of the
proceeds thereof. The closing of a Restricted Property Transaction shall be
conditioned upon provision for payment to each holder of Preferred Shares of the
amount owed pursuant to Section 7(c). If such payment or provision therefore
cannot be made for any reason, the proposed Restricted Property Transaction
shall not be consummated. If, in accordance with Section 7(c), not all the
Preferred Shares requested to be repurchased by the Company are to be
repurchased, repurchases of Preferred Shares shall be made ratably from each
holder based on the number of Preferred Shares held by each holder requesting a
repurchase; provided that no holder shall have repurchased from such holder more
shares than such holder has requested to have repurchased.
c. In connection with the consummation of a Restricted
Property Transaction the Company shall be obligated to purchase up to that
number of Preferred Shares equal to (i) the applicable release price set forth
in SCHEDULE 7 (the "RELEASE PRICE") for the Restricted Property which is the
subject of the Restricted Property Transaction divided by (ii) $100. If the
Restricted Property Transaction is consummated on any day prior to the date
which is thirty (30) months after the Mandatory Closing Date (the "EARLY SALE
PERIOD"), the purchase price for each share shall be the Early Sale Repurchase
Price (as hereinafter defined). If the Restricted Property Transaction is
consummated on any day on or after the date which is thirty (30) months after
the Mandatory Closing Date, the purchase price for each share shall be the
Standard Sale Repurchase Price (as hereinafter defined).
d. For purposes of this Agreement:
"EARLY SALE REPURCHASE PRICE" means, with respect to
any Preferred Share, (i) $100 plus (ii) the Yield Maintenance Premium
plus any additional dividends (other than Regular Dividends (as defined
in the Certificate of Designations)) accrued and unpaid on such
Preferred Share.
"STANDARD SALE REPURCHASE PRICE" means, with respect
to any Preferred Share, (i) the amount necessary to generate the Base
Internal Rate of Return (as defined in the Certificate of Designations)
plus (ii) the amount of all accumulated and accrued but unpaid
dividends on such Preferred Share (other than Regular Dividends), each
computed as of the date of repurchase by the Company. Notwithstanding
the foregoing or any other provision of this Agreement or the
Certificate Designations to the contrary, the Standard Sale Repurchase
Price with respect to any outstanding Preferred Share computed as of a
particular date shall be in the same amount as the Standard Sale
Repurchase Price with respect to each other outstanding Preferred Share
computed as of such date.
"YIELD MAINTENANCE PREMIUM" means for each Preferred
Share for which such premium must be determined, the positive excess,
if any, as of the date of repurchase of such Preferred Share by the
Company, of (a) the Yield Maintenance Cash
33
Flows (calculated as described below) with respect to such Preferred
Share to the date of repurchase by the Company of such Preferred Share
discounted at [CONFIDENTIAL TREATMENT REQUESTED]*. The "YIELD
MAINTENANCE CASH FLOWS" with respect to a Preferred Share is the
monthly cash flows otherwise due to the holder of such Preferred
Share for which the Yield Maintenance Premium is being calculated,
including all Regular Dividends and the Standard Sale Repurchase
Price (other than amounts required by clause (ii) of the definition
of Standard Sale Repurchase Payment) that would be payable to the
holder of such Preferred Share on the assumption that all Regular
Dividends are paid in full in cash on each Dividend Reference Date
and that the Standard Sale Repurchase Price was paid in cash in full
on the first Business Day after the end of the Early Sale Period.
Notwithstanding the foregoing or any other provision of this
Agreement or the Certificate Designations to the contrary, the Yield
Maintenance Premium with respect to any outstanding Preferred Share
computed as of a particular date shall be in the same amount as the
Yield Maintenance Premium with respect to each other outstanding
Preferred Share computed as of such date.
8. TRANSFER AGENT INSTRUCTIONS.
The Company shall issue irrevocable instructions to its
transfer agent, and to any subsequent transfer agent, to issue certificates,
registered in the name of each holder of Preferred Shares or its respective
nominee(s), for the Conversion Shares and the Warrant Shares in such amounts as
specified from time to time by each holder of Preferred Shares to the Company
upon conversion of the Preferred Shares or exercise of the Warrants. Prior to
registration of the Conversion Shares and the Warrant Shares under the 1933 Act,
all such certificates shall bear the restrictive legend specified in Section
2(g). If a holder of Preferred Shares provides the Company with an opinion of
counsel, in a generally acceptable form, to the effect that a public sale,
assignment or transfer of the Securities may be made without registration under
the 1933 Act, and such holder of Preferred Shares represents to the Company that
it has satisfied any conditions on which such opinion of counsel is based, or a
holder of Preferred Shares provides the Company with reasonable assurances that
the Securities can be sold pursuant to Rule 144(k) (or any successor thereto),
the Company shall permit the transfer, and, in the case of the Conversion Shares
and the Warrant Shares, promptly instruct its transfer agent to issue one or
more certificates in such name and in such denominations as specified by such
holder and without any restrictive legend. The Company acknowledges that a
breach by it of its obligations hereunder will cause irreparable harm to the
holders of Preferred Shares by vitiating the intent and purpose of the
transaction contemplated hereby. Accordingly, the Company acknowledges that the
remedy at law for a breach of its obligations under this Section 8 will be
inadequate and agrees, in the event of a breach or threatened breach by the
Company of the provisions of this Section 8, that the holders of Preferred
Shares shall be entitled, in addition to all other available remedies, to an
order and/or injunction restraining any breach and requiring immediate issuance
and transfer, without the necessity of showing economic loss and without the
posting of any bond or other security being required.
----------------
*[CONFIDENTIAL TREATMENT REQUESTED] Indicates material that has been omitted
and for which confidential treatment is being requested. All such omitted
material is being filed with The Securities and Exchange Commission pursuant
to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as
amended.
34
9. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL.
a. INITIAL CLOSING DATE. The obligation of the Company to
issue and sell the Initial Preferred Shares to Buyer at the Initial Closing is
subject to the satisfaction, at or before the Initial Closing Date, of each of
the following conditions, provided that these conditions are for the Company's
sole benefit and may be waived by the Company at any time in its sole
discretion:
(i) Buyer shall have executed each of the Transaction
Documents to which it is a party and delivered the same to the Company.
(ii) Buyer shall have delivered to the Company the Purchase
Price (less the amounts withheld pursuant to Sections 4(h) and 4(i))
for the Initial Preferred Shares being purchased by Buyer at the
Initial Closing by wire transfer of immediately available funds
pursuant to the wire instructions provided by the Company.
(iii) the Ownership Limit Waiver Agreement, including the
certificate attached thereto, shall be been delivered to the Company
executed by Buyer in the form attached hereto as EXHIBIT F (the
"OWNERSHIP LIMIT WAIVER").
(iv) the representations and warranties of Buyer, including
those made pursuant to the Ownership Limit Waiver Agreement, shall be
true and correct as of the date when made and as of the Initial Closing
Date as though made at that time (except for representations and
warranties that speak as of a specific date, which shall be true and
correct as of such date), and Buyer shall have performed, satisfied and
complied with the covenants, agreements and conditions required by the
Transaction Documents to be performed, satisfied or complied with by
Buyer at or prior to the Closing Date.
b. MANDATORY CLOSING DATE. The obligation of the Company
hereunder to issue and sell the Mandatory Preferred Shares to Buyer at the
Mandatory Closing is subject to the satisfaction, at or before such Mandatory
Closing Date, of each of the following conditions, provided that these
conditions are for the Company's sole benefit and may be waived by the Company
at any time in its sole discretion:
(i) Buyer shall have delivered to the Company the Purchase
Price (less the amounts withheld pursuant to Sections 4(h) and 4(i))
for the Mandatory Preferred Shares being purchased by Buyer at the
Mandatory Closing by wire transfer of immediately available funds
pursuant to the wire instructions provided by the Company.
(ii) the representations and warranties of Buyer, including
those made pursuant to the Ownership Limit Waiver Agreement, shall be
true and correct as of the date when made and as of the Mandatory
Closing Date as though made at that time (except for representations
and warranties that speak as of a specific date, which shall be true
and correct as of such date), and Buyer shall have performed, satisfied
and complied with the covenants, agreements and conditions required by
the Transaction Documents to be performed, satisfied or complied with
by Buyer at or prior to the Mandatory Closing Date.
35
10. CONDITIONS TO BUYER'S OBLIGATION TO PURCHASE.
a. INITIAL CLOSING DATE. The obligation of Buyer hereunder to
purchase the Initial Preferred Shares from the Company at the Initial Closing is
subject to the satisfaction, at or before the Initial Closing Date, of each of
the following conditions, provided that these conditions are for Buyer's sole
benefit and may be waived by Buyer at any time in its sole discretion:
(i) the Company shall have executed each of the Transaction
Documents and delivered the same to Buyer.
(ii) the Certificate of Designations shall have been filed
with the Secretary of State of the State of Delaware, and a copy
thereof certified by such Secretary of State, or a facsimile of such a
copy and certification, shall have been delivered to Buyer.
(iii) the Common Stock (x) shall be designated for quotation
or listed on the Principal Market and (y) shall not have been suspended
by the SEC or the Principal Market from trading on the Principal Market
nor shall suspension by the SEC or the Principal Market have been
threatened either (A) in writing by the SEC or the Principal Market or
(B) by falling below the minimum listing maintenance requirements of
the Principal Market; and the Conversion Shares issuable upon
conversion of the Initial Preferred Shares shall be listed upon the
Principal Market.
(iv) the representations and warranties of the Company shall
be true and correct as of the date when made and as of the Initial
Closing Date as though made at that time (except for representations
and warranties that speak as of a specific date, which shall be true
and correct as of such date) and the Company shall have performed,
satisfied and complied with the covenants, agreements and conditions
required by the Transaction Documents to be performed, satisfied or
complied with by the Company at or prior to the Closing Date. Buyer
shall have received a certificate, executed by a duly authorized
officer of the Company, dated as of the Closing Date, to the foregoing
effect and as to such other matters as may be reasonably requested by
Buyer including, but not limited to, an update as of the Closing Date
regarding the representation contained in Section 3(c) above.
(v) Buyer shall have received the opinion of Xxxxx & Xxxxxxx
L.L.P. dated as of the Initial Closing Date, in form, scope and
substance reasonably satisfactory to Buyer and in substantially the
form of EXHIBIT D attached hereto.
(vi) the Company shall have executed and delivered to Buyer
the Initial Preferred Stock Certificates (in such denominations as
Buyer shall request) for the Initial Preferred Shares being purchased
by Buyer at the Initial Closing.
(vii) the Board of Directors of the Company shall have adopted
resolutions consistent with Section 3(b) above and in a form reasonably
acceptable to Buyer (the "TRANSACTIONS RESOLUTIONS").
36
(viii) as of the Initial Closing Date, the Company shall have
reserved out of its authorized and unissued Common Stock, solely for
the purpose of effecting the conversion of the Initial Preferred Shares
and issuance of the Initial Warrant Shares, an agreed upon number of
shares of Common Stock.
(ix) the Company shall have delivered to Buyer a certified
copy of the Certificate of Incorporation as certified by the Secretary
of State of the State of Delaware, and a good standing certificate for
the Company as certified by the Secretary of State of the State of
Delaware, each as of a date within fifteen (15) days of the Initial
Closing Date.
(x) the Company shall have delivered to Buyer a secretary's
certificate, dated as of the Initial Closing Date, as to (A) the
Transaction Resolutions, (B) resolutions of the Company's Board of
Directors increasing the Ownership Limit to 9.225% (the "OWNERSHIP
LIMIT RESOLUTIONS"), (C) the Certificate of Incorporation, (D) the
By-Laws, with (A), (B) and (C) each as in effect at the Initial
Closing, (E) the Limited Partnership Agreement of the Operating
Partnership and all amendments thereto and (F) the incumbency
signatures of those officers of the Company executing this Agreement or
any document or instrument contemplated hereby.
(xi) the Company shall have made all filings required to be
made prior to closing under all applicable federal and state securities
laws necessary to consummate the issuance of the Securities pursuant to
this Agreement in compliance with such laws.
(xii) the Company shall have delivered to Buyer such other
documents relating to the transactions contemplated by this Agreement
as Buyer or its counsel may reasonably request.
(xiii) a certificate shall have been delivered to Buyer
executed by Bayerische Hypo-Und Vereinsbank AG (the "BANK") in which
the Bank (i) consents to the transactions contemplated hereby and by
the other Transaction Documents, (ii) indicates that no Event of
Default under the Loan Documents will be triggered as a result of the
consummation of the transactions contemplated hereby and by the other
Transaction Documents and (iii) indicates that, to the knowledge of the
Bank, no Event of Default has occurred under the Loan Documents.
(xiv) an Ownership Limit Waiver Agreement shall be been
delivered to Buyer executed by the Company in the form attached hereto
as EXHIBIT F.
(xv) an amendment to the Limited Partnership Agreement of the
Operating Partnership in the form of EXHIBIT G (the "PARTNERSHIP
AGREEMENT AMENDMENT") shall have been duly adopted.
37
b. MANDATORY CLOSING DATE. The obligation of Buyer hereunder
to purchase the Mandatory Preferred Shares from the Company at the Mandatory
Closing is subject to the satisfaction, at or before the Mandatory Closing Date,
of each of the following conditions, provided that these conditions are for
Buyer's sole benefit and may be waived by Buyer at any time in its sole
discretion:
(i) all dividends accumulated and accrued but unpaid on the
Initial Preferred Shares through the close of business on the day
preceding the Mandatory Closing Date shall be paid in full in cash on
the Mandatory Closing Date prior to the issuance of the Mandatory
Preferred Shares.
(ii) the Company shall have complied with and satisfied all of
the requirements of Section 1(c).
(iii) the Certificate of Designations shall be in full force
and effect and shall not have been amended since the Initial Closing
Date, and a copy thereof certified by the Secretary of State of the
State of Delaware as of a date within fifteen (15) days of the
Mandatory Closing Date shall have been delivered to Buyer.
(iv) the Common Stock (x) shall be designated for quotation or
listed on the Principal Market and (y) shall not have been suspended by
the SEC or the Principal Market from trading on or delisted from the
Principal Market nor shall delisting or suspension by such Principal
Market have been threatened either (A) in writing by the SEC or the
Principal Market or (B) by falling below the minimum listing
maintenance requirements of the Principal Market; and all of the shares
of Common Stock that may be issuable as Conversion Shares or Warrant
Shares shall be listed upon the Principal Market.
(v) the representations and warranties of the Company shall be
true and correct as of the date when made and as of the Mandatory
Closing Date as though made at that time (except for representations
and warranties that speak as of a specific date, which shall be true
and correct as of such date and except as such representations and
warranties may no longer be true and correct as the result of events
that do not constitute a Material Adverse Effect, individually or in
the aggregate, and that do not breach any of the covenants of the
Company contained herein) and the Company shall have performed,
satisfied and complied with the covenants, agreements and conditions
required by the Transaction Documents or the Certificate of
Designations to be performed, satisfied or complied with by the Company
at or prior to the Mandatory Closing Date. Buyer shall have received a
certificate, executed by the Chief Executive Officer of the Company,
dated as of the Mandatory Closing Date, to the foregoing effect and as
to such other matters as may be reasonably requested by Buyer
including, but not limited to, an update as of the Mandatory Closing
Date regarding the representation contained in Section 3(c) above.
(vi) Buyer shall have received the opinion of Xxxxx and
Xxxxxxx L.L.P. dated as of the Mandatory Closing Date, in form, scope
and substance reasonably satisfactory to Buyer and in substantially the
form of EXHIBIT D attached hereto.
38
(vii) the Company shall have executed and delivered to Buyer
the Preferred Stock Certificates (in such denominations as Buyer shall
request) for the Mandatory Preferred Shares being purchased by Buyer at
the Mandatory Closing.
(viii) the Transaction Resolutions and the Ownership Limit
Resolutions shall be in full force and effect and shall not have been
amended as of the Mandatory Closing Date.
(ix) as of the Mandatory Closing Date, the Company shall have
reserved out of its authorized and unissued Common Stock, solely for
the purpose of effecting the conversion of the Preferred Shares or the
issuance of the Warrant Shares, a number of shares of Common Stock
equal to an agreed upon number of shares of Common Stock which would be
issuable upon conversion in full of the then outstanding Preferred
Shares.
(x) the Company shall have delivered to Buyer a good standing
certificate for the Company as certified by the Secretary of State of
the State of Delaware dated no more than three (3) days before the
Mandatory Closing Date.
(xi) the Company shall have delivered to Buyer a secretary's
certificate, dated as of the Mandatory Closing Date, certifying as to
(A) the Transaction Resolutions, (B) the Ownership Limit Resolutions,
(C) the Certificate of Incorporation, (C) the By-Laws, and (D) the
Limited Partnership Agreement of the Operating Partnership and all
amendments thereto, each as in effect at the Mandatory Closing.
(xii) the Company shall have made all filings under all
applicable federal and state securities laws necessary to consummate
the issuance of the Securities pursuant to this Agreement in compliance
with such laws.
(xiii) the Company shall have delivered to Buyer such other
documents relating to the transactions contemplated by this Agreement
as Buyer or its counsel may reasonably request.
11. INDEMNIFICATION. In consideration of Buyer's execution and delivery
of the Transaction Documents and acquiring the Securities thereunder and in
addition to all of the Company's other obligations under the Transaction
Documents and the Certificate of Designations, the Company shall defend,
protect, indemnify and hold harmless Buyer and each other holder of the
Securities and all of their stockholders, officers, partners, members,
directors, employees and direct or indirect investors and any of the foregoing
persons' agents or other representatives (including, but not limited to, those
retained in connection with the transactions contemplated by this Agreement)
(collectively, the "INDEMNITEES") from and against any and all actions, causes
of action, suits, claims, losses, costs, penalties, fees, liabilities and
damages, and expenses in connection therewith (irrespective of whether any such
Indemnitee is a party to the action for which indemnification hereunder is
sought), and including reasonable attorneys' fees and disbursements (the
"INDEMNIFIED LIABILITIES"), incurred by any Indemnitee as a result of, or
arising out of, or relating to (i) any misrepresentation or breach of any
representation or warranty made by the Company in the Transaction Documents or
any other certificate, instrument or document contemplated hereby or thereby,
(ii) any breach of any covenant, agreement or
39
obligation of the Company contained in the Transaction Documents or any other
certificate, instrument or document contemplated hereby or thereby, (iii) any
cause of action, suit or claim brought or made against such Indemnitee and
arising out of or resulting from the execution, delivery or performance of the
Transaction Documents or any other certificate, instrument or document
contemplated hereby or thereby, or (iv) any transaction financed or to be
financed in whole or in part, directly or indirectly, with the proceeds of the
issuance of the Securities. To the extent that the foregoing undertaking by the
Company may be unenforceable for any reason, the Company shall make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law. Except as otherwise set
forth herein, the mechanics and procedures with respect to the rights and
obligations under this Section 11 shall be the same as those set forth in
Sections 6(a) and (d) of the Registration Rights Agreement, including, but not
limited to, those procedures with respect to the settlement of claims and the
Company's rights to assume the defense of claims.
12. GOVERNING LAW; MISCELLANEOUS.
a. GOVERNING LAW; JURISDICTION; JURY TRIAL. The corporate laws
of the State of Delaware shall govern all issues concerning the relative rights
of the Company and its stockholders. All other questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by the internal laws of the State of New York, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of New York. Each party hereby
irrevocably submits to the non-exclusive jurisdiction of the state and federal
courts sitting in the City of New York, Borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT
OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
b. COUNTERPARTS. This Agreement may be executed in two or more
identical counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party; provided that a facsimile signature
shall be considered due execution and shall be binding upon the signatory
thereto with the same force and effect as if the signature were an original, not
a facsimile signature.
40
c. HEADINGS. The headings of this Agreement are for
convenience of reference only and shall not form part of, or affect the
interpretation of, this Agreement.
d. SEVERABILITY. If any provision of this Agreement shall be
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other jurisdiction.
e. ENTIRE AGREEMENT; AMENDMENTS. This Agreement supersedes all
other prior oral or written agreements between Buyer, the Company, their
affiliates and persons acting on their behalf with respect to the matters
discussed herein, and this Agreement and the instruments referenced herein
contain the entire understanding of the parties with respect to the matters
covered herein and therein and, except as specifically set forth herein or
therein, neither the Company nor Buyer makes any representation, warranty,
covenant or undertaking with respect to such matters. No provision of this
Agreement may be amended or waived other than by an instrument in writing signed
by the Company and the holders of at least two-thirds (66 2/3%) of the
outstanding Preferred Shares or, if this Agreement is to be amended or waived
prior to the issuance of any Preferred Shares, an instrument in writing signed
by the Company and Buyer. Any such instrument shall be binding upon all parties
hereto. No such amendment shall be effective to the extent that it applies to
less than all of the holders of the Preferred Shares or Warrants then
outstanding. No consideration shall be offered or paid to any person to amend or
consent to a waiver or modification of any provision of any of the Transaction
Documents or the Certificate of Designations unless the same consideration also
is offered to all of the parties to the Transaction Documents or holders of
Preferred Shares, as the case may be.
f. NOTICES. Any notices, consents, waivers or other
communications required or permitted to be given under the terms of this
Agreement must be in writing and will be deemed to have been delivered: (i) upon
receipt, when delivered personally or (ii) one Business Day after deposit with a
nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. The addresses for such
communications shall be:
If to the Company:
The Xxxxx Corporation
0000 Xxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: Chief Executive Officer (one copy)
General Counsel (one copy)
41
with a copy to:
Xxxxx & Xxxxxxx L.L.P.
000 Xxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: Xxxx X. Xxx, Esq.
If to Buyer:
iStar Financial Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President (one copy)
Chief Financial Officer (one copy)
with a copy to:
iStar Financial Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Chief Executive Officer (one copy)
General Counsel (one copy)
and
Xxxxxx Xxxxxx Xxxxx
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxx, Esq.
or at such other address and/or to the attention of such other person as the
recipient party has specified by written notice given to the party sending such
notice five days prior to the effectiveness of such change. Written confirmation
of receipt (A) given by the recipient of such notice, consent, waiver or other
communication or (B) provided by a nationally recognized overnight delivery
service shall be rebuttable evidence of personal service or receipt from a
nationally recognized overnight delivery service in accordance with clause (i)
or (ii) above, respectively.
g. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties and their respective successors and
assigns, including any holders of Preferred Shares; provided, however, that (1)
this Agreement shall not inure to the benefit of any holder of Preferred Shares
who has not agreed in writing to be bound by its terms; (2) no Preferred Shares
may be transferred if, as a result thereof, the Company would be required to
register such shares pursuant to the 1934 Act; (3) no Preferred Shares may be
transferred to a transferee that is not an "accredited investor" as such term is
defined in Rule 501(a) of Regulation D promulgated under the 1933 Act; and (4)
Buyer may not transfer or assign its obligations hereunder with respect to the
Mandatory Closing. The Company shall not assign this
42
Agreement or any rights or obligations hereunder without the prior written
consent of the holders of at least two-thirds (66-2/3%) of the Preferred Shares
then outstanding, including by merger or consolidation, except pursuant to a
Change of Control with respect to which the Company is in compliance with the
terms and conditions of the Transaction Documents and the Certificate of
Designations. The Company shall cooperate with Buyer and each holder of
Preferred Shares in pledging and/or transferring Preferred Shares and Warrants
so long as such transfers are in compliance with the terms and conditions of
this Agreement.
h. SURVIVAL. Unless this Agreement is terminated under Section
12(k), the representations and warranties of the Company and the Buyer contained
in Sections 2 and 3, the agreements and covenants set forth in Sections 4 and 5,
and the indemnification provisions set forth in Section 11, shall survive the
Closings.
i. PUBLICITY. The Company and Buyer shall have the right to
approve before issuance any press releases or any other public statements with
respect to the transactions contemplated hereby; provided, however, that the
Company shall be entitled, without the prior approval of any Buyer, to make any
press release or other public disclosure with respect to such transactions as is
required by applicable law and regulations (although Buyer shall be consulted by
the Company in connection with any such press release or other public disclosure
prior to its release and shall be provided with a copy thereof).
j. FURTHER ASSURANCES. Each party shall do and perform, or
cause to be done and performed, all such further acts and things, and shall
execute and deliver all such other agreements, certificates, instruments and
documents, as the other party may reasonably request in order to carry out the
intent and accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
k. TERMINATION. In the event that the Initial Closing shall
not have occurred with respect to Buyer on or before five (5) Business Days from
the date hereof due to the Company's or Buyer's failure to satisfy the
conditions set forth in Sections 9(a) and 10(a) above (and the nonbreaching
party's failure to waive such unsatisfied condition(s)), the nonbreaching party
shall have the option to terminate this Agreement with respect to such breaching
party at the close of business on such date without liability of any party to
any other party; provided, however, that if this Agreement is terminated
pursuant to this Section 12(k), the Company shall remain obligated to reimburse
Buyer for the expenses described in Section 4(h) above.
l. PLACEMENT AGENT. The Company acknowledges that it has
engaged Banc of America Securities LLC as placement agent in connection with the
sale of the Preferred Shares, which placement agent may have formally or
informally engaged other agents on its behalf. The Company shall be solely
responsible for the payment of any placement agent's fees or broker's
commissions relating to or arising out of the transactions contemplated hereby.
The Company shall pay, and hold Buyer harmless against, any liability, loss or
expense (including, but not limited to, attorneys' fees and out-of-pocket
expenses) arising in connection with any such claim.
43
m. NO STRICT CONSTRUCTION. The language used in this Agreement
will be deemed to be the language chosen by the parties to express their mutual
intent, and no rules of strict construction will be applied against any party.
n. REMEDIES. Buyer and each holder of the Securities shall
have all rights and remedies set forth in the Transaction Documents and the
Certificate of Designations and all rights and remedies which such holders have
been granted at any time under any other agreement or contract and all of the
rights which such holders have under any law. Any person having any rights under
any provision of this Agreement shall be entitled to enforce such rights
specifically (without posting a bond or other security), to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights granted by law.
o. PAYMENT SET ASIDE. To the extent that the Company makes a
payment or payments pursuant to the Transaction Documents or the Certificate of
Designations or Buyer or other holder of Securities enforces or exercises their
rights hereunder or thereunder, and such payment or payments or the proceeds of
such enforcement or exercise or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside, recovered from, disgorged
by or are required to be refunded, repaid or otherwise restored to the Company,
a trustee, receiver or any other person under any law (including, but not
limited to, any bankruptcy law, state or federal law, common law or equitable
cause of action), then to the extent of any such restoration the obligation or
part thereof originally intended to be satisfied shall be revived and continued
in full force and effect as if such payment had not been made or such
enforcement or setoff had not occurred.
[Remainder of page intentionally left blank.
Signature page follows.]
44
IN WITNESS WHEREOF, the Company and Buyer have caused this Securities
Purchase Agreement to be duly executed as of the date first written above.
COMPANY: BUYER:
-------- ------
THE XXXXX CORPORATION iSTAR PREFERRED HOLDINGS LLC
By: /S/ XXXXX X. XxXXXXXX By: XXX XXXXXXXX
--------------------------------------------- ------------------------------
Name: Xxxxx X. XxXxxxxx Name: Xxx Xxxxxxxx
Title: President and Chief Operating Officer Title: Chief Executive Officer
SCHEDULES
Schedule 3(a)(i) Subsidiaries
Schedule 3(a)(ii) Significant Subsidiaries
Schedule 3(c)(i) Capitalization of the Company
Schedule 3(c)(ii) Capitalization Diagram
Schedule 3(e)(i)-(iv) Conflicts
Schedule 3(f) SEC Documents
Schedule 3(g) Material Changes
Schedule 3(h)(i)-(ii) Litigation
Schedule 3(n) Employee Relations
Schedule 3(o)(i)-(iii) Intellectual Property
Schedule 3(p) Environmental Laws
Schedule 3(t)(i)-(ii) Indebtedness
Schedule 3(u) Tax Status
Schedule 3(v) Certain Transactions
Schedule 4(e)(iv) Joint Ventures
Schedule 4(s)(iv) Loan Documents
Schedule 4(s)(vii) Distributions
Schedule 4(s)(xii)(A) Restricted Property Debt
Schedule 4(s)(xii)(B) Equipment Financing
Schedule 7 Restricted Properties
EXHIBITS
Exhibit A Form of Certificate of Designations
Exhibit B Form of Warrant
Exhibit C Form of Registration Rights Agreement
Exhibit D Form of Company Counsel Opinion
Exhibit E Reserved
Exhibit F Ownership Limit Waiver Agreement
Exhibit G Limited Partnership Agreement Amendment
Exhibit H Examples of Calculations of Base Internal Rate of Return
Exhibit I Examples of Calculations of Standard Call Payments
Exhibit J Examples of Calculations of Yield Maintenance Premium
Exhibit K Examples of Calculations of Call Option Exercise Price
