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2,200,000 SHARES
BRANDYWINE REALTY TRUST
COMMON SHARES OF BENEFICIAL INTEREST
UNDERWRITING AGREEMENT
February 26, 1997
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
c/o XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Brandywine Realty Trust, a Maryland real estate investment trust (the
"Company"), proposes to issue and sell an aggregate of 2,200,000 shares (the
"Firm Shares") of its common shares of beneficial interest, $0.01 par value per
share (the "Common Shares"), to you (collectively, the "Underwriters"). The
Company also proposes to sell to the Underwriters, upon the terms and
conditions set forth in Section 2 hereof, up to an additional 330,000 Common
Shares (the "Additional Shares"). The Firm Shares and the Additional Shares
are hereinafter collectively referred to as the "Shares."
The Company, directly and through a wholly-owned subsidiary, is the
sole general partner and a limited partner (with an aggregate 95.48% ownership
interest as of the date hereof, without giving effect to the issuance and sale
of any Shares hereunder) of Brandywine Operating Partnership, L.P., a Delaware
limited partnership (the "Operating Partnership"). The Company will contribute
the net proceeds of the sale of the Firm Shares and the Additional Shares to
the Operating Partnership in exchange for additional partnership interests in
the Operating Partnership. The Company and the Operating Partnership wish to
confirm as follows their agreement with you, in connection with the several
purchases of the Shares by the Underwriters.
1. Registration Statement and Prospectus. The Company has
prepared and filed with the Securities and Exchange Commission (the
"Commission") in accordance with the provisions of the Securities Act of 1933,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Act"), a registration statement on Form S-3 (Registration
No. 333-20991) under the Act, with respect to an aggregate of $500,000,000 of
Preferred Shares, Common Shares, Depositary Shares and Warrants, including a
prospectus generally relating to the Shares; and such amendments to such
registration statement as may have been required prior to the date hereof have
been filed with the Commission, and such amendments have been
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similarly prepared. Such registration statement and any post-effective
amendments thereto have become effective under the Act. The Company also has
filed, or proposes to file, with the Commission pursuant to Rule 424(b) under
the Act, a prospectus supplement specifically relating to the Shares.
The term "Registration Statement" as used in this Agreement means the
registration statement (including all financial schedules and exhibits), as
amended at the time it became effective, as supplemented or amended prior to
the execution of this Agreement, including all information (if any) deemed to
be a part of such registration at the time it became effective pursuant to Rule
430A under the Act. If it is contemplated, at the time this Agreement is
executed, that a post-effective amendment to the registration statement will be
filed and must be declared effective before the offering of the Shares may
commence, the term "Registration Statement" as used in this Agreement means the
registration statement as amended by said post-effective amendment. The term
"Prospectus" as used in this Agreement means the base prospectus included in
the registration statement at the time it was declared effective (the "Base
Prospectus") together with the prospectus supplement relating to the Shares
dated the date hereof in the form first filed with the Commission on or after
February 14, 1997 pursuant to Rule 424(b) under the Act. The term "Prepricing
Prospectus Supplement" as used in this Agreement means the Base Prospectus
together with any prospectus supplement subject to completion as filed with the
Commission pursuant to Rule 424(b) under the Act, and as such Prepricing
Prospectus Supplement shall have been amended or supplemented from time to time
prior to the date of the Prospectus. Any reference in this Agreement to the
Registration Statement, the Base Prospectus, any Prepricing Prospectus
Supplement or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the Act, as of the date of the Registration Statement, such Prepricing
Prospectus Supplement of the Prospectus, as the case may be, any reference to
any amendment or supplement to the Registration Statement, any Prepricing
Prospectus Supplement or the Prospectus shall be deemed to refer to and include
any documents filed after such date under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), which, upon filing, are incorporated by
reference therein, as required by paragraph (b) of Item 12 of Form S-3. As
used herein, the term "Incorporated Documents" means the documents which at the
time are incorporated by reference in the Registration Statement, any
Prepricing Prospectus Supplement, the Prospectus, or any amendment or
supplement thereto. Capitalized terms used, but not defined, herein shall have
the respective meanings ascribed thereto in the Prospectus.
2. Agreements to Sell and Purchase. The Company hereby agrees,
subject to all the terms and conditions set forth herein, to issue and sell to
each Underwriter and, upon the basis of the representations, warranties and
agreements of the Company and the Operating Partnership herein contained and
subject to all the terms and conditions set forth herein, each Underwriter
agrees, severally and not jointly, to purchase from the Company, at a purchase
price of $19.545 per Share (the "purchase price per share"), the number of Firm
Shares set forth opposite the name of such Underwriter in Schedule I hereto (or
such number of Firm Shares increased as set forth in Section 11 hereof).
The Company also agrees, subject to all the terms and conditions set
forth herein, to sell to the Underwriters, and, upon the basis of the
representations, warranties and agreements of the Company and the Operating
Partnership herein contained and subject to all the terms and conditions set
forth herein, the Underwriters shall have the right to purchase from the
Company,
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at the purchase price per share, pursuant to an option (the "over-allotment
option") which may be exercised at any time and from time to time prior to 9:00
P.M., New York City time, on the 30th day after the date of the Prospectus (or,
if such 30th day shall be a Saturday or Sunday or a holiday, on the next
business day thereafter when the American Stock Exchange is open for trading),
up to an aggregate of 330,000 Additional Shares. Additional Shares may be
purchased only for the purpose of covering over-allotments made in connection
with the offering of the Firm Shares. Upon any exercise of the over-allotment
option, each Underwriter, severally and not jointly, agrees to purchase from
the Company the number of Additional Shares (subject to such adjustments as you
may determine in order to avoid fractional shares) which bears the same
proportion to the number of Additional Shares to be purchased by the
Underwriters as the number of Firm Shares set forth opposite the name of such
Underwriter in Schedule I hereto (or such number of Firm Shares increased as
set forth in Section 11 hereof) bears to the aggregate number of Firm Shares.
3. Terms of Public Offering. The Company has been advised by you
that you propose to make a public offering of your respective portions of the
Shares as soon after this Agreement has become effective as in your judgment is
advisable and initially to offer the Shares upon the terms set forth in the
Prospectus.
4. Delivery of the Shares and Payment Therefor. Delivery to the
Underwriters of and payment for the Firm Shares shall be made at the office of
Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX 00000, at 10:00 A.M., New
York City time, on March 4, 1997 (the "Closing Date"). The place of closing
for the Firm Shares and the Closing Date may be varied by agreement between you
and the Company.
Delivery to the Underwriters of and payment for any Additional Shares
to be purchased by the Underwriters shall be made at the aforementioned office
of Xxxxx Xxxxxx Inc. at such time on such date (the "Option Closing Date"),
which may be the same as the Closing Date but shall in no event be earlier than
the Closing Date nor earlier than two nor later than ten business days after
the giving of the notice hereinafter referred to, as shall be specified in a
written notice from you to the Company of your determination to purchase a
number, specified in such notice, of Additional Shares. The place of closing
for any Additional Shares and the Option Closing Date for such Shares may be
varied by agreement between you and the Company.
Certificates for the Firm Shares and for any Additional Shares to be
purchased hereunder shall be registered in such names and in such denominations
as you shall request prior to 9:30 A.M., New York City time, on the second
business day preceding the Closing Date or any Option Closing Date, as the case
may be. Such certificates shall be made available to you in New York City for
inspection and packaging not later than 9:30 A.M., New York City time, on the
business day next preceding the Closing Date or the Option Closing Date, as the
case may be. The certificates evidencing the Firm Shares and any Additional
Shares to be purchased hereunder shall be delivered to you on the Closing Date
or the Option Closing Date, as the case may be, against payment of the purchase
price therefor by wire transfer of immediately available funds to the Company.
5. Agreements of the Company and the Operating Partnership. The
Company and the Operating Partnership jointly and severally agree with the
several Underwriters as follows:
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(a) If, at the time this Agreement is executed and
delivered, it is necessary for a post-effective amendment to the Registration
Statement to be declared effective before the offering of the Shares may
commence, the Company will endeavor to cause such post-effective amendment to
become effective as soon as possible and will advise you promptly and, if
requested by you, will confirm such advice in writing, when such post-effective
amendment has become effective.
(b) The Company will advise you promptly and, if
requested by you, will confirm such advice in writing: (i) of any request by
the Commission for amendment of or a supplement to the Registration Statement,
any Prepricing Prospectus or the Prospectus or for additional information; (ii)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of the suspension of
qualification of the Shares for offering or sale in any jurisdiction or the
initiation of any proceeding for such purpose; and (iii) within the period of
time referred to in paragraph (f) below, of any change in the Company's
condition (financial or other), business, prospects, properties, net worth or
results of operations, or of the happening of any event, which makes any
statement of a material fact made in the Registration Statement or the
Prospectus (as then amended or supplemented) untrue or which requires the
making of any additions to or changes in the Registration Statement or the
Prospectus (as then amended or supplemented) in order to state a material fact
required by the Act or the regulations thereunder to be stated therein or
necessary in order to make the statements therein not misleading, or of the
necessity to amend or supplement the Prospectus (as then amended or
supplemented) to comply with the Act or any other law. If at any time the
Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, the Company will make every reasonable effort to obtain
the withdrawal of such order at the earliest possible time.
(c) The Company will furnish to you, without charge, (i)
one copy of the Registration Statement as originally filed with the Commission
and of each amendment thereto, including financial statements and all exhibits
to the Registration Statement, (ii) two copies of the Prepricing Prospectus
Supplement or Prospectus, (iii) such number of copies of the documents
incorporated by reference in the Prepricing Prospectus Supplement or Prospectus
since September 30, 1996, as you may reasonably request, and (iv) such number
of conformed copies of the Registration Statement and of each amendment
thereto, but without exhibits, as you may reasonably request.
(d) The Company will not file any amendment to the
Registration Statement or make any amendment or supplement to the Prospectus
or, prior to the end of the period of time referred to in the first sentence of
subsection (f) below, file any document which upon filing becomes an
Incorporated Document, of which you shall not previously have been advised or
to which you shall object after being so advised.
(e) Prior to the execution and delivery of this
Agreement, the Company has delivered to you, without charge, in such quantities
as you have reasonably requested, copies of the Prepricing Prospectus
Supplement. The Company consents to the use, in accordance with the provisions
of the Act and with the securities or Blue Sky or real estate syndication laws
of the jurisdictions in which the Shares are offered by the several
Underwriters and by dealers, prior to the date of the Prospectus, of each
Prepricing Prospectus Supplement so furnished by the Company.
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(f) As soon after the execution and delivery of this
Agreement as possible and thereafter from time to time for such period as in
the opinion of counsel for the Underwriters a prospectus is required by the Act
to be delivered in connection with sales by any Underwriter or dealer, the
Company will expeditiously deliver to each Underwriter and each dealer, without
charge, as many copies of the Prospectus (and of any amendment or supplement
thereto) as you may reasonably request. The Company consents to the use of the
Prospectus (and of any amendment or supplement thereto) in accordance with the
provisions of the Act and with the securities or Blue Sky or real estate
syndication laws of the jurisdictions in which the Shares are offered by the
several Underwriters and by all dealers to whom Shares may be sold, both in
connection with the offering and sale of the Shares and for such period of time
thereafter as the Prospectus is required by the Act to be delivered in
connection with sales by any Underwriter or dealer. If during such period of
time any event shall occur that in the judgment of the Company or in the
opinion of counsel for the Underwriters is required to be set forth in the
Prospectus (as then amended or supplemented) or should be set forth therein in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or
amend the Prospectus to comply with the Act or any other law, the Company will
forthwith prepare and, subject to the provisions of paragraph (d) above, file
with the Commission an appropriate supplement or amendment thereto, and will
expeditiously furnish to the Underwriters and dealers a reasonable number of
copies thereof. In the event that the Company and you agree that the
Prospectus should be amended or supplemented, the Company, if requested by you,
will promptly issue a press release announcing or disclosing the matters to be
covered by the proposed amendment or supplement.
(g) The Company will cooperate with you and with counsel
for the Underwriters in connection with the registration or qualification of
the Shares for offering and sale by the several Underwriters and by dealers
under the securities or Blue Sky or real estate syndication laws of such
jurisdictions as you may designate and will file such consents to service of
process or other documents necessary or appropriate in order to effect such
registration or qualification; provided that in no event shall the Company be
obligated to qualify to do business in any jurisdiction where it is not now so
qualified or to take any action which would subject it to service of process in
suits, other than those arising out of the offering or sale of the Shares, in
any jurisdiction where it is not now so subject.
(h) The Company will make generally available to its
security holders a consolidated earnings statement, which need not be audited,
covering a twelve-month period commencing after the effective date of the
Registration Statement and ending not later than 15 months thereafter, as soon
as practicable after the end of such period, which consolidated earnings
statement shall satisfy the provisions of Section 11(a) of the Act.
(i) During the period of five years hereafter, the
Company will furnish to you (i) as soon as available, a copy of each report of
the Company mailed to stockholders or filed with the Commission, and (ii) from
time to time such other information concerning the Company as you may
reasonably request.
(j) If this Agreement shall terminate or shall be
terminated after execution pursuant to any provisions hereof (otherwise than
pursuant to Section 11 hereof or by notice given by you terminating this
Agreement pursuant to Section 11 or Section 12 hereof) or if this Agreement
shall be terminated by the Underwriters because of any failure or refusal on
the part
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of the Company to comply with the terms or fulfill any of the conditions of
this Agreement, the Company agrees to reimburse you for all out-of-pocket
expenses (including fees and expenses of counsel for the Underwriters) incurred
by you in connection herewith.
(k) The Company will apply the net proceeds from the sale
of the Shares in accordance with the description set forth in the Prospectus.
(l) The Company will timely file with the Commission the
Prospectus pursuant to Rule 424(b) under the Act and will advise you of the
time and manner of such filing.
(m) Except as stated in this Agreement and in any
Prepricing Prospectus Supplement and Prospectus, the Company will not take,
directly or indirectly, any action designed to or that might reasonably be
expected to cause or result in stabilization or manipulation of the price of
the Common Shares to facilitate the sale or resale of the Shares.
(n) The Shares are approved for listing, subject to
notice of issuance, on the American Stock Exchange.
6. Representations and Warranties of the Company. The Company
and the Operating Partnership, jointly and severally, represent and warrant to
each Underwriter that:
(a) No order preventing or suspending the use of any
Prepricing Prospectus Supplement or the Prospectus has been issued and no
proceeding for that purpose has been instituted or threatened by the Commission
or the securities authority of any state or other jurisdiction. No stop order
suspending the effectiveness of the Registration Statement or any part thereof
has been issued and no proceeding for that purpose has been instituted or
threatened or, to the best knowledge of the Company, contemplated by the
Commission or the securities authority of any state or other jurisdiction.
(b) The Company and the transactions contemplated by this
Agreement meet the requirements and conditions for using a registration
statement on Form S-3 under the Act, set forth in the General Instructions to
Form S-3. When any Prepricing Prospectus Supplement was filed with the
Commission it (i) contained all statements required to be stated therein in
accordance with, and complied in all material respects with the requirements
of, the Act and the rules and regulations of the Commission thereunder and (ii)
did not include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading. When the
Registration Statement or any amendment thereto was declared effective, and on
the Closing Date (or the Option Closing Date, as the case may be) it (i)
contained or will contain all statements required to be stated therein in
accordance with, and complied or will comply in all material respects with the
requirements of, the Act and the rules and regulations of the
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Commission thereunder and (ii) did not or will not include any untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein not misleading. When the Prospectus or any amendment or
supplement thereto is filed with the Commission pursuant to Rule 424(b) and at
the Closing Date (or the Option Closing Date, as the case may be), the
Prospectus, as amended or supplemented at any such time, (i) contained or will
contain all statements required to be stated therein in accordance with, and
complied or will comply in all material respects with the requirements of, the
Act and the rules and regulations of the Commission thereunder and (ii) did not
or will not include any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. The
representations and warranties in this paragraph (b) do not apply to statements
in or omissions from the Registration Statement or the Prospectus made in
reliance upon and in conformity with information furnished to the Company in
writing by or on behalf of any Underwriter expressly for use therein.
(c) The Incorporated Documents heretofore filed, when
they were filed (or, if any amendment with respect to any such document was
filed, when such amendment was filed), conformed in all material respects with
the requirements of the Exchange Act and the rules and regulations thereunder,
any further Incorporated Documents so filed will, when they are filed, conform
in all material respects with the requirements of the Exchange Act and the
rules and regulations thereunder, no such document when it was filed (or, if an
amendment with respect to any such document was filed, when such amendment was
filed), contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading and no such further document, when it is
filed, will contain an untrue statement of a material fact or will omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading.
(d) The Company is a real estate investment trust duly
formed and validly existing under and by virtue of the laws of the State of
Maryland and is in good standing with the State Department of Assessments and
Taxation of Maryland, with full trust power and authority to own, lease, and
operate its properties (including the properties (the "Acquisition Properties")
described in the Prospectus under the caption "Recent Developments - Pending
Acquisitions" as being subject to agreements of sale (the "Transaction
Documents")), and to conduct its business as described in the Registration
Statement and the Prospectus, and is duly registered and qualified to conduct
its business and is in good standing in each jurisdiction or place where the
nature of its properties or the conduct of its business (after taking into
account the purchase of the Acquisition Properties) requires such registration
or qualification, except where the failure to be so registered or qualified
would not have a material adverse effect on the condition (financial or
otherwise), business, prospects, properties, net worth or results of operations
of the Company.
(e) Each of the Operating Partnership and the
corporations, partnerships and limited partnerships listed on Schedule 6(e)
hereto (each, a "Subsidiary") is a corporation, limited partnership, or general
partnership duly incorporated or formed, as the case may be, validly existing
and in good standing under the laws of its jurisdiction of incorporation or
formation. Each such entity has full corporate or partnership power and
authority, to own, lease, and operate its properties, and to conduct its
business as described in the Registration Statement and the Prospectus. Each
such Subsidiary is duly registered and qualified to conduct its business and is
in good standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such registration or
qualification, except where the failure to be so registered or qualified would
not have a material adverse effect on the condition (financial or otherwise),
business, prospects, properties, net worth or results of operations of such
Subsidiary.
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(f) All the outstanding Common Shares of the Company have
been duly authorized and validly issued, are fully paid and nonassessable and
are free of any preemptive or similar rights; the Shares have been duly
authorized and, when issued and delivered to the Underwriters against payment
therefor in accordance with the terms hereof, will be validly issued, fully
paid and nonassessable and free of any preemptive or similar rights that
entitle or will entitle any person or entity to acquire any Shares upon the
issuance thereof by the Company, and the beneficial interest of the Company
conforms to the description thereof in the Registration Statement and the
Prospectus in all material respects. Except as disclosed in the Prospectus,
there are no outstanding options, warrants or other rights calling for the
issuance of, or any commitment, plan or arrangement to issue, any beneficial
interest of the Company or any security convertible into or exchangeable for
beneficial interest of the Company.
(g) All of the outstanding limited partner interests in
the Operating Partnership ("Units"), and shares of capital stock or partnership
interests in each of the Subsidiaries have been duly authorized and validly
issued or created under the documents or agreements forming such entity, are
fully paid and, in the case of Subsidiaries that are corporations,
nonassessable, and will be owned or be held by the persons and entities in the
percentage amounts set forth and in the manner described in the Prospectus.
Except as described in the Prospectus, all such Units, partnership interests
and shares of capital stock are owned by the Company directly, or indirectly
through the Operating Partnership or one of the other Subsidiaries, free and
clear of any lien, adverse claim, security interest, equity, or other
encumbrance, and the Company's percentage interest and ownership in the
Operating Partnership, and the Company's and the Operating Partnership's
percentage interest and ownership in each of the Subsidiaries, is as set forth
on Schedule 6(g) attached hereto. Except as described in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), there
are no outstanding options, warrants or other rights calling for the issuance
of, or any commitment, plan or arrangement to issue, any equity interests in
any Subsidiary, or any security convertible into, or exchangeable or
exercisable for, any such interests in any such Subsidiary. The terms of the
Units conform in all material respects to statements and descriptions thereof
contained in the Prospectus. The Company is the sole general partner of the
Operating Partnership and has sole voting, management and administrative
control of Brandywine Realty Partners.
(h) The Company has no direct or indirect subsidiaries
other than the Subsidiaries. Other than the Subsidiaries, neither the Company
nor the Operating Partnership owns, directly or indirectly, more than 2% of the
securities of any corporation, partnership, joint venture, limited liability
company, association or other business association.
(i) There are no actions, suits or proceedings pending
or, to the knowledge of the Company or the Operating Partnership, threatened
against or affecting the Company or any of the Subsidiaries, or any of their
respective partners, directors, trustees or officers in their capacity as such,
or to which the Company or any of the Subsidiaries or any of their respective
partners, directors, trustees or officers in their capacity as such, or to
which any of their respective properties is subject, that are required to be
described in the Registration Statement or the Prospectus but are not described
as required, and there are no agreements, contracts, indentures, leases or
other instruments that are required to be described in the Registration
Statement or the Prospectus or to be filed as an exhibit to the Registration
Statement that are not described or filed as required by the Act.
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(j) Neither the Company nor any of the Subsidiaries is in
violation of its Declaration of Trust, certificate or articles of incorporation
or by-laws, partnership agreement or other organizational documents, or of any
law, ordinance, administrative or governmental rule or regulation applicable to
the Company or any of the Subsidiaries or of any decree of any court or
governmental agency or body having jurisdiction over the Company or any of the
Subsidiaries, or in default in any material respect in the performance of any
obligation, agreement or condition contained in any bond, debenture, note or
any other evidence of indebtedness or in any agreement, indenture, lease or
other instrument to which the Company or any of the Subsidiaries is a party or
by which any of them or any of their respective properties may be bound.
(k) Neither the issuance and offer, and sale or delivery
of the Shares, the execution, delivery or performance of this Agreement, nor
the consummation of the transactions contemplated hereby or thereby by the
Company or any Subsidiary, as applicable, (i) required or requires any consent,
approval, authorization or other order of or registration or filing with, any
court, regulatory body, administrative agency or other governmental body,
agency or official (except such as may be required for the registration of the
Shares under the Act and compliance with the securities or Blue Sky laws of
various jurisdictions, all of which have been or will be effected in accordance
with this Agreement), (ii) conflicted with, conflicts or will conflict with or
constituted, constitutes or will constitute a breach of, or a default under,
the Declaration of Trust, certificate or articles of incorporation or bylaws,
partnership agreement or other organizational documents, of the Company or any
of the Subsidiaries or under any agreement, indenture, lease or other
instrument to which the Company or any of the Subsidiaries is a party or by
which any of them or any of their respective properties may be bound, (iii)
violated, violates or will violate any statute, law, regulation or filing or
judgment, injunction, order or decree applicable to the Company or any of the
Subsidiaries or any of their respective properties, or (iv) resulted, results
or will result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of the Subsidiaries pursuant
to the terms of any agreement or instrument to which any of them is a party or
by which any of them may be bound or to which any of the property or assets of
any of them is subject.
(l) All offers and sales of Units or other partnership
interests in the Operating Partnership, and the offer, sale or issuance by the
Company of Common Shares and Preferred Shares prior to the date hereof have
been duly registered under the Act, or were exempt from the registration
requirements of the Act and state securities and Blue Sky laws.
(m) The accountants, Xxxxxx Xxxxxxxx LLP, who have
audited the financial statements included in the Registration Statement and the
Prospectus (and any amendment or supplement thereto), are independent public
accountants as required by the Act.
(n) The financial statements (including the information
disclosed under the caption "Recent Developments - 1996 Operating Results"),
together with related schedules and notes, included in the Registration
Statement and the Prospectus (and any amendment or supplement thereto), present
fairly the consolidated financial position, results of operations and changes
in cash flows of the respective entity, entities, property, or properties, as
applicable, at the respective dates or for the respective periods to which they
apply; such statements and related schedules and notes have been prepared in
accordance with generally accepted accounting principles consistently applied
throughout the periods involved, and comply with the applicable
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accounting requirements of the Act (including, without limitation, Rule 3-14 of
Regulation S-X promulgated by the Commission). The other financial and
statistical information and data included in the Registration Statement and the
Prospectus (and any amendment or supplement thereto) are accurately presented
and prepared on a basis consistent with such financial statements and the books
and records of the relevant entity, entities, property or properties, as
applicable; any pro forma financial statements of the Company included in the
Registration Statement and the Prospectus comply in all material respects with
the applicable requirements of Rule 11-02 of Regulation S-X of the Commission,
and any pro forma adjustments have been made upon management's reasonable good
faith estimates of the pro forma adjustments and have been properly applied to
the historical amounts in the compilation of such statements.
(o) The Company has all trust power and authority, and
the Operating Partnership has all partnership power and authority, to enter
into this Agreement and each Transaction Document to which it is a party, and,
in the case of the Company, to issue, sell and deliver the Shares to the
Underwriters as provided in the Underwriting Agreement, and each of the
Underwriting Agreement and each Transaction Document has been duly and validly
authorized, executed and delivered by the Company and the Operating
Partnership, as applicable, and, to the knowledge of the Company, each of the
other parties thereto, and is a valid, legal and binding agreement of each of
the Company and the Operating Partnership, as applicable, enforceable against
each of the Company and the Operating Partnership in accordance with its terms,
except as enforcement of rights to indemnity and contribution hereunder may be
limited by Federal or state securities laws or principles of public policy.
(p) Except as disclosed in the Registration Statement and
the Prospectus (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), neither
the Company nor any of the Subsidiaries has incurred any liability or
obligation, direct or contingent, or entered into any transaction, not in the
ordinary course of business, that is material to the Company and the
Subsidiaries taken as a whole, and there has not been any change in the
beneficial interest or capital stock, or material increase in the short-term
debt or long-term debt, of the Company or any of the Subsidiaries, or any
material adverse change, or any development involving or which may reasonably
be expected to involve, a prospective material adverse change, in the condition
(financial or other), business, prospects, properties, net worth or results of
operations of the Company and the Subsidiaries taken as a whole.
(q) Each of the Company or the Operating Partnership
(either directly or through a Subsidiary) has, and after giving effect to the
transactions described in the Registration Statement and Prospectus will have,
good and marketable and insurable title to all property (real and personal)
described in the Prospectus as being or to be owned by it, free and clear of
all liens, claims, security interests or other encumbrances except such as are
described in the Registration Statement and the Prospectus or in a document
filed as an exhibit to the Registration Statement. All the property described
in the Prospectus as being held under lease by each of the Company and the
Subsidiaries is held by it under valid, subsisting and enforceable leases,
other than those described in the Registration Statement and the Prospectus and
those which do not and will not have a material adverse effect on the condition
(financial or other), business, prospects, properties, net worth or results of
operations of the Company and the Subsidiaries taken as a whole.
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(r) The Company has not distributed and, prior to the
later to occur of (i) the Closing Date and (ii) completion of the distribution
of the Shares, will not distribute any offering material in connection with the
offering and sale of the Shares other than the Registration Statement, the
Prepricing Prospectus Supplement, the Prospectus or other materials, if any,
permitted by the Act.
(s) Each of the Company and each of the Subsidiaries has,
and after giving effect to the pending acquisition transactions described in
the Prospectus under the caption "Recent Developments - Pending Acquisitions"
(the "Pending Acquisitions") will have, such permits, licenses, franchises and
authorizations of governmental or regulatory authorities ("permits") as are
necessary to own its respective properties (including the Acquisition
Properties) and to conduct its business in the manner described in the
Prospectus; each of the Company and each of the Subsidiaries has fulfilled and
performed all its material obligations with respect to such permits and no
event has occurred which allows, or after notice or lapse of time would allow,
revocation or termination thereof or results in any other material impairment
of the rights of the holder of any such permit, subject in each case to such
qualification as may be set forth in the Prospectus; and, except as described
in the Prospectus, none of such permits contains any restriction that is
materially burdensome to the Company or any of the Subsidiaries.
(t) The Company together with the Subsidiaries maintains
and will maintain a system of internal accounting controls sufficient to
provide reasonable assurances that (i) transactions are executed in accordance
with management's general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
accountability for assets; (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 existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(u) Neither the Company nor any of its Subsidiaries nor
any employee or agent of the Company or any Subsidiary has made any payment of
funds of the Company or any Subsidiary or received or retained any funds in
violation of any law, rule or regulation, which payment, receipt or retention
of funds is of a character required to be disclosed in the Prospectus.
(v) The Company and each of the Subsidiaries have filed
all tax returns required to be filed, which returns are complete and correct,
and neither the Company nor any Subsidiary is in default in the payment of any
taxes which were payable pursuant to said returns or any assessments with
respect thereto.
(w) Except as described in the Prospectus, there is no
holder of any security of the Company, or the Operating Partnership or any
other person who has the right, contractual or otherwise, to cause the Company
to sell or otherwise issue to them, or to permit them to underwrite the sale
of, the Shares or the right to have any Common Shares or other securities of
the Company included in the Registration Statement or the right, as a result of
the filing of the registration statement or sale of the Shares as contemplated
by this Agreement, to require registration under the Act of any Common Shares
or other securities of the Company.
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(x) The Company and the Subsidiaries own or possess all
patents, trademarks, trademark registrations, service marks, service xxxx
registrations, trade names, copyrights, licenses, inventions, trade secrets and
rights described in the Prospectus as being owned by them or any of them or
necessary for the conduct of their respective businesses, and neither the
Company nor the Operating Partnership is aware of any claim to the contrary or
any challenge by any other person to the rights of the Company and the
Subsidiaries with respect to the foregoing.
(y) None of the Company or any Subsidiary is now, and
after sale of the Shares to be sold by it hereunder and application of the net
proceeds from such sale as described in the Prospectus under the caption "Use
of Proceeds" will be, an "investment company," or entity "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
(z) The Company has filed in a timely manner each
document or report required to be filed by it pursuant to the Exchange Act and
the rules and regulations thereunder; each such document or report at the time
it was filed conformed to the requirements of the Exchange Act and the rules
and regulations thereunder; and none of such documents or reports contained an
untrue statement of any material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading.
(aa) The Company and its Subsidiaries are organized and
operate in the manner described in the Registration Statement so that the
Company meets the requirements for qualification as a real estate investment
trust under Sections 856 through 860 of the Code and the rules and regulations
thereunder as currently in effect. Each Subsidiary that is a partnership will
be treated as a partnership, and not as an association taxable as a corporation
or a publicly traded partnership, for federal income tax purposes.
(ab) The Shares are duly authorized for listing, subject
to official notice of issuance, on the American Stock Exchange.
(ac) Except as described in the Prospectus or provided in
the Credit Facility, the mortgages and deeds of trust encumbering the
Properties will not be cross-defaulted or cross-collateralized with any other
property not owned directly or indirectly by the Company or any of the
Subsidiaries.
(ad) (1) Each of the Properties, the Company, and each
of the Subsidiaries (i) is, and as of the Closing Date will be, in compliance
in all material respects with any and all applicable foreign, federal, state
and local laws and regulations relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants ("Environmental Laws"), (ii) has received, or will have
received, as of the Closing Date and upon consummation of the Pending
Acquisitions, as the case may be, all permits, licenses or other approvals
required of them under applicable Environmental Laws to conduct their
respective business, and (iii) is, and will be as of the Closing Date in
material compliance with all terms and conditions of any such permit, license
or approval.
(2) Except as may be specifically disclosed in
the Phase I Environmental Site Assessment reports referred to in the Prospectus
(the "Environmental
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Reports"), the Company and the Subsidiaries have not at any time, and, to the
knowledge of the Company, no other party has at any time, handled, buried,
stored, retained, refined, transported, processed, manufactured, generated,
produced, spilled, allowed to seep, leak, escape or xxxxx, or be pumped,
poured, emitted, emptied, discharged, injected, dumped, transferred or
otherwise disposed of or dealt with, Hazardous Materials (as hereinafter
defined) on, to or from the Properties. The Company and the Subsidiaries do
not intend to use the Properties or any subsequently acquired properties for
the purpose of handling, burying, storing (except with respect to cleaning
materials reasonably used to operate the Properties in the ordinary course, in
normal quantities and in full compliance with law), retaining, refining,
transporting, processing, manufacturing, generating, producing, spilling,
seeping, leaking, escaping, leaching, pumping, pouring, emitting, emptying,
discharging, injecting, dumping, transferring or otherwise disposing of or
dealing with Hazardous Materials.
(3) Except as disclosed in the Environmental
Reports, to the knowledge of the Company, there has been no seepage, leaking,
escape, leaching, discharge, injection, release, emission, spill, pumping,
pouring, emptying or dumping of Hazardous Materials into waters on or adjacent
to the Properties or onto lands from which such hazardous or toxic waste or
substances might seep, flow or drain into such waters.
(4) Except as disclosed in the Environmental
Reports, neither the Company nor any Subsidiary has received notice of any
occurrence or circumstance which, with notice or passage of time or both, would
give rise to any claim under or pursuant to any Environmental Law pertaining to
hazardous or toxic waste or substances on or originating from the Properties or
arising out of the conduct of any such party.
(5) No environmental engineering firm which
prepared the Environmental Reports (or amendments thereto) or physical
condition (engineering) reports with respect to the Properties was employed for
such purpose on a contingent basis or has any substantial interest in the
Company or any Subsidiary.
As used herein, "Hazardous Material" shall include, without
limitation, any flammable explosives, radioactive materials, hazardous
materials, hazardous wastes, hazardous or toxic substances or related
materials, asbestos or any related material as defined by any Federal, state or
local environmental law, ordinance, rule, or regulation including, without
limitation, Environmental Laws such as the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended (42 U.S.C.
Section 9601, et seq.) ("CERCLA"), the Hazardous Materials Transportation Act,
as amended (49 U.S.C. Section 1801, et seq.), the Resource Conservation and
Recovery Act, as amended (42 U.S.C. Section 9601, et seq.) The New Jersey
Industrial Site Recovery Act, N.J.S.A.Section 13:1K-6, et seq. or and in the
regulations adopted and publications promulgated pursuant to each of the
foregoing or by any Federal, state or local Governmental authority having or
claiming jurisdiction over the Properties as described in the Prospectus.
(ae) To the knowledge of the Company, all physical
condition (engineering) reports obtained for the Properties are materially true
and correct. Except as set forth in any structural reports described in the
Prospectus, neither the Company nor any of the Subsidiaries is aware of any
material capital expenditures (other than expenditures for maintenance in the
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ordinary course of business) which will be required in connection with any of
the Properties prior to the fifth anniversary of this Agreement.
(af) As of the Closing Date and after giving effect to the
Pending Acquisitions, the Company or the Operating Partnership, as applicable,
will have obtained ALTA Extended Coverage Owner's Policies of Title Insurance
(or its equivalent) from title insurers of recognized financial responsibility
on each of the Properties, including the Acquisition Properties, in amounts at
least equal to the acquisition price of each such property (or, in the case of
the Property at Delaware Corporate Center I, the leasehold interest) (and
improvements located on each such property), and such insurance shall be in
full force and effect.
(ag) The assets of the Company and the Subsidiaries do
not, and as of the Closing Date will not, constitute "plan assets" under the
Employee Retirement Income Security Act of 1974, as amended ("ERISA").
(ah) Each partnership agreement, agreement of limited
partnership, other organizational or formation agreement, and each amendment
thereto, of each Subsidiary that is a general or limited partnership (the
"Organizational Documents") has been duly and validly authorized, executed and
delivered by the Company and the applicable Subsidiaries party thereto, and
each such Organizational Document constitutes the legal, valid and binding
agreement of each party thereto, enforceable against each such party in
accordance with its terms.
(ai) Each of the agreements disclosed in the Prospectus
under the caption "Recent Developments -- Pending Acquisitions" as having been
executed has been executed and delivered by the seller thereunder and has been
duly and validly authorized, executed and delivered by each of the Company and
the Subsidiaries that is a party thereto, and each such agreement constitutes
the legal, valid and binding agreement of each such party thereto, enforceable
against each such party in accordance with its terms.
(aj) (i) The Company and its Subsidiaries have their
respective principal business operations in the United States or its
Territories.
(ii) The Company has a class of securities registered
pursuant to Section 12(b) of the Exchange Act.
(iii) The Company (A) since prior to February 14,
1994, has been subject to the requirements of Section 12 of the
Exchange Act and has filed all the material required to be filed
pursuant to Sections 13 and 14 of the Exchange Act, and (B) since
prior to February 14, 1996, has filed in a timely manner all reports
required to be filed under Sections 13 and 14 of the Exchange Act, and
has not used Rule 12b-25(b) under the Exchange Act.
(iv) Neither the Company nor any Subsidiary has,
since December 31, 1995, (A) failed to pay any dividend or sinking
fund installment on preferred stock, or (B) defaulted (I) on any
installment or installments on indebtedness for borrowed money, or
(II) on any rental on one or more long term leases.
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(v) The aggregate market value of the Company's
voting stock held by non-affiliates of the Company is $100 million or
more and the Company had a trading volume of such stock of 3,000,000
shares or more during the 12 month period ended January 31, 1997.
7. Indemnification and Contribution. (a) The Company and the
Operating Partnership, jointly and severally, agree to indemnify and hold
harmless each Underwriter, the directors, officers, employees and agents of
each Underwriter, and each person, if any, who controls any Underwriter within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act from and
against any and all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation) arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in
any Prepricing Prospectus Supplement or in the Registration Statement or the
Prospectus or in any amendment or supplement thereto, or arising out of or
based upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages, liabilities or
expenses arise out of or are based upon any untrue statement or omission or
alleged untrue statement or omission which has been made therein or omitted
therefrom in reliance upon and in conformity with the information relating to
such Underwriter furnished in writing to the Company by or on behalf of any
Underwriter through you expressly for use in connection therewith (which
information is described in its entirety in Section 13 below); provided,
however, that the indemnification contained in this paragraph (a) with respect
to any Prepricing Prospectus Supplement shall not inure to the benefit of any
Underwriter (or to the benefit of any person controlling such Underwriter) on
account of any such loss, claim, damage, liability or expense arising from the
sale of the Shares by such Underwriter to any person if a copy of the
Prospectus shall not have been delivered or sent to such person within the time
required by the Act and the regulations thereunder, and the untrue statement or
alleged untrue statement or omission or alleged omission of a material fact
contained in such Prepricing Prospectus was corrected in the Prospectus,
provided that the Company has delivered the Prospectus to the several
Underwriters in requisite quantity on a timely basis to permit such delivery or
sending within the time required by the Act. The foregoing indemnity agreement
shall be in addition to any liability which the Company may otherwise have.
(b) If any action, suit or proceeding shall be brought against any
Underwriter or any person controlling any Underwriter in respect of which
indemnity may be sought against the Company or the Operating Partnership, such
Underwriter or such controlling person shall promptly notify the Company or the
Operating Partnership, and the Company or the Operating Partnership shall
assume the defense thereof, including the employment of counsel and payment of
all fees and expenses. Such Underwriter or any such controlling person shall
have the right to employ separate counsel in any such action, suit or
proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Underwriter or such controlling
person unless (i) the Company and the Operating Partnership have agreed in
writing to pay such fees and expenses, (ii) the Company and the Operating
Partnership have failed to assume the defense and employ counsel, or (iii) the
named parties to any such action, suit or proceeding (including any impleaded
parties) include both such Underwriter or such controlling person and the
Company or the Operating Partnership and such Underwriter or such controlling
person shall have been advised by its counsel that representation of such
indemnified party and the Company or the Operating Partnership by the same
counsel
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would be inappropriate under applicable standards of professional conduct
(whether or not such representation by the same counsel has been proposed) due
to actual or potential differing interests between them (in which case the
Company and the Operating Partnership shall not have the right to assume the
defense of such action, suit or proceeding on behalf of such Underwriter or
such controlling person). It is understood, however, that the Company shall,
in connection with any one such action, suit or proceeding or separate but
substantially similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for all such
Underwriters and controlling persons not having actual or potential differing
interests with you or among themselves, which firm shall be designated in
writing by Xxxxx Xxxxxx Inc., and that all such fees and expenses shall be
reimbursed as they are incurred. The Company and the Operating Partnership
shall not be liable for any settlement of any such action, suit or proceeding
effected without its written consent, but if settled with such written consent,
or if there shall be a final judgment for the plaintiff in any such action,
suit or proceeding, the Company and the Operating Partnership agree to
indemnify and hold harmless any Underwriter, to the extent provided in the
preceding paragraph, and any such controlling person from and against any loss,
claim, damage, liability or expense by reason of such settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, its trustees and officers who sign the
Registration Statement, and any person who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the same
extent as the foregoing indemnity from the Company and the Operating
Partnership to each Underwriter, but only with respect to losses, claims,
damages, liabilities and expenses arising out of or based on information
relating to such Underwriter furnished in writing by or on behalf of such
Underwriter through you expressly for use in the Registration Statement, the
Prospectus or any Prepricing Prospectus Supplement, or any amendment or
supplement thereto. If any action, suit or proceeding shall be brought against
the Company, any of its directors or officers, or any such controlling person
based on the Registration Statement, the Prospectus or any Prepricing
Prospectus, or any amendment or supplement thereto, and in respect of which
indemnity may be sought against any Underwriter pursuant to this paragraph (c),
such Underwriter shall have the rights and duties given to the Company and the
Operating Partnership by paragraph (b) above (except that if the Company or the
Operating Partnership shall have assumed the defense thereof such Underwriter
shall not be required to do so, but may employ separate counsel therein and
participate in the defense thereof, but the fees and expenses of such counsel
shall be at such Underwriter's expense), and the Company, its trustees and
officers, and any such controlling person shall have the rights and duties
given to the Underwriters by paragraph (b) above. The foregoing indemnity
agreement shall be in addition to any liability which the Underwriters may
otherwise have.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Company and the Operating Partnership, on the one hand, and the
Underwriters, on the other hand, from the offering of the Shares, or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
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in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
the Operating Partnership, on the one hand, and the Underwriters, on the other,
in connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company and
the Operating Partnership, on the one hand, and the Underwriters, on the other,
shall be deemed to be in the same proportion as the total net proceeds from the
offering (before deducting expenses) received by the Company and the Operating
Partnership bear to the total underwriting discounts and commissions received
by the Underwriters, in each case as set forth in the table on the cover page
of the Prospectus. The relative fault of the Company on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to
information supplied by the Company on the one hand or by the Underwriters on
the other hand and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
(e) The Company, the Operating Partnership and the Underwriters
agree that it would not be just and equitable if contribution pursuant to this
Section 7 were determined by a pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable considerations referred
to in paragraph (d) above. The amount paid or payable by an indemnified party
as a result of the losses, claims, damages, liabilities and expenses referred
to in paragraph (d) above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating any claim or defending
any such action, suit or proceeding. Notwithstanding the provisions of this
Section 7, no Underwriter shall be required to contribute any amount in excess
of the amount by which the total price of the Shares underwritten by it and
distributed to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section 7 are several in proportion to the respective numbers
of Firm Shares set forth opposite their names in Schedule I hereto (or such
numbers of Firm Shares increased as set forth in Section 11 hereof) and not
joint.
(f) No indemnifying party shall, without the prior written consent
of the indemnified party, effect any settlement of any pending or threatened
action, suit or proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such action, suit or proceeding.
(g) Any losses, claims, damages, liabilities or expenses for which
an indemnified party is entitled to indemnification or contribution under this
Section 7 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 7 and the
representations and warranties of the Company and the Operating Partnership set
forth in this Agreement shall remain operative and in full force and effect,
regardless of (i) any
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investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter, the Company and its trustees or officers, the Operating
Partnership and its officers, or any person controlling the Company or the
Operating Partnership, (ii) acceptance of any Shares and payment therefor
hereunder, and (iii) any termination of this Agreement. A successor to any
Underwriter or any person controlling any Underwriter, or to the Company and
its trustees or officers, the Operating Partnership and its officers, or any
person controlling the Company or the Operating Partnership, shall be entitled
to the benefits of the indemnity, contribution, and reimbursement agreements
contained in this Section 7.
8. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase the Firm Shares hereunder are
subject to the following conditions:
(a) If, at the time this Agreement is executed and
delivered, it is necessary for the registration statement or a post-effective
amendment thereto to be declared effective before the offering of the Shares
may commence, the registration statement or such post-effective amendment shall
have become effective not later than 5:30 P.M., New York City time, on the date
hereof, or at such later date and time as shall be consented to in writing by
you, and all filings, if any, required by Rules 424 and 430A under the Act
shall have been timely made; no stop order suspending the effectiveness of the
registration statement shall have been issued and no proceeding for that
purpose shall have been instituted or, to the knowledge of the Company or any
Underwriter, threatened by the Commission, and any request of the Commission
for additional information (to be included in the Registration Statement or the
Prospectus or otherwise) shall have been complied with to your satisfaction.
(b) Subsequent to the effective date of this Agreement,
there shall not have occurred (i) any change, or any development involving a
prospective change, in or affecting the condition (financial or other),
business, prospects, properties, net worth, or results of operations of the
Company or the Subsidiaries not contemplated by the Prospectus, which in your
opinion would materially, adversely affect the market for the Shares, or (ii)
any event or development relating to or involving the Company or any officer or
trustee of the Company or the Operating Partnership which makes any statement
made in the Prospectus untrue or which, in the opinion of the Company and its
counsel or the Underwriters and their counsel, requires the making of any
addition to or change in the Prospectus in order to state a material fact
required by the Act or any other law to be stated therein or necessary in order
to make the statements therein, in light of the circumstances in which they
were made, not misleading, if amending or supplementing the Prospectus to
reflect such event or development would, in your opinion, materially, adversely
affect the market for the Shares.
(c) You shall have received on the Closing Date, the
opinion of Pepper, Xxxxxxxx & Xxxxxxx LLP, counsel for the Company, the
Operating Partnership and the other Subsidiaries, dated the Closing Date and
addressed to you, in the form set forth on Exhibit 8(c) attached hereto.
In rendering their opinion as aforesaid, such counsel may rely
upon an opinion or opinions, each dated the Closing Date, of other counsel
retained by them or the Company as to laws of any jurisdiction other than the
United States, the State of New York, the Commonwealth of Pennsylvania and the
State of Delaware, provided that (1) each such local counsel is reasonably
acceptable to you, (2) such reliance is expressly authorized by each opinion
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so relied upon and a copy of each such opinion is delivered to you and is, in
form and substance, satisfactory to you and your counsel, and (3) such counsel
shall state in their opinion that they believe that they and the Underwriters
are justified in relying thereon.
(d) You shall have received on the Closing Date an
opinion of Xxxxxx Xxxxxxxx LLP, special tax advisor to the Company,
satisfactory in form and substance to you, to the effect that (i) the
descriptions of the Federal income tax conclusions contained in the Prospectus
under the caption "Federal Income Tax Considerations" are correct in all
material respects, and the discussion contained therein fairly summarizes the
Federal income tax considerations that may be material to a holder of the
common shares; (ii) assuming the Company is operated in accordance with the
assumptions and representations of management regarding its activities and
intended activities, the Company will continue to qualify as a REIT under the
Code; and (iii) the Operating Partnership and the Title Holding Partnerships
will be treated for Federal income tax purposes as partnerships and not as
associations taxable as corporations or as publicly-traded partnerships.
(e) You shall have received on the Closing Date, an
opinion of Xxxxxx Xxxxxxxx LLP, special tax advisor to the Company, dated the
Closing Date and addressed to you, satisfactory in form and substance to you,
to the effect that the Company will not be considered to own more than ten
percent of the outstanding voting securities of Brandywine Realty Services
Corp. at the close of the years ended December 31, 1996 and December 31, 1997.
(f) You shall have received on the Closing Date an
opinion of Battle Xxxxxx LLP, counsel for the Underwriters, dated the Closing
Date and addressed to you, with respect to the Registration Statement, the
Prospectus and this Agreement and such other related matters as you may
request.
(g) You shall have received comfort letters, including,
but not limited to, certain agreed upon procedures, addressed to you and dated
the date hereof and the Closing Date from Xxxxxx Xxxxxxxx LLP, independent
public accountants, substantially in the forms heretofore approved by you. The
comfort letter dated the Closing Date shall include language in scope and
substance substantially as set forth on Exhibit 8(g).
(h) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been taken or, to the knowledge of the Company or the
Underwriters, shall be contemplated by the Commission at or prior to the
Closing Date; (ii) there shall not have been any change in the beneficial
interest of the Company nor any material increase in the short-term or
long-term debt of the Company (other than in the ordinary course of business)
from that set forth or contemplated in the Registration Statement or the
Prospectus (or any amendment or supplement thereto); (iii) there shall not have
been, since the respective dates as of which information is given in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto), except as may otherwise be stated in the Registration Statement and
Prospectus (or any amendment or supplement thereto), any material adverse
change in the condition (financial or other), business, prospects, properties,
net worth or results of operations of the Properties or the Company and the
Subsidiaries taken as a whole; (iv) the Company and the Subsidiaries shall not
have any liabilities or obligations, direct or contingent (whether or not in
the ordinary course of business),
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that are material to the Company and the Subsidiaries, taken as a whole, other
than those reflected in the Registration Statement or the Prospectus (or any
amendment or supplement thereto); and (v) all the representations and
warranties of the Company and the Operating Partnership contained in this
Agreement shall be true and correct on and as of the date hereof and on and as
of the Closing Date as if made on and as of the Closing Date, and you shall
have received a certificate, dated the Closing Date and signed by the chief
executive officer and the chief financial officer of the Company (or such other
officers as are acceptable to you), to the effect set forth in this Section
8(h) and in Section 8(i) hereof.
(i) The Company shall not have failed at or prior to the
Closing Date to have performed or complied with any of its agreements herein
contained and required to be performed or complied with by it hereunder at or
prior to the Closing Date.
(j) The Shares shall have been listed or approved for
listing upon notice of issuance on the American Stock Exchange.
(k) The Company and the Operating Partnership shall have
furnished or caused to be furnished to you such further certificates and
documents as you shall have reasonably requested.
All such opinions, certificates, letters and other documents will be
in compliance with the provisions hereof only if they are satisfactory in form
and substance to you and your counsel.
Any certificate or document signed by any officer of the Company and
the Operating Partnership and delivered to you, or to counsel for the
Underwriters, shall be deemed a representation and warranty by the Company or
the Operating Partnership, as applicable, to each Underwriter as to the
statements made therein.
The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the satisfaction on and as of any Option
Closing Date of the conditions set forth in this Section 8, except that, if any
Option Closing Date is other than the Closing Date, the certificates, opinions
and letters referred to in paragraphs (c) through (h) shall be dated the Option
Closing Date in question and the opinions called for by paragraphs (c), (d),
(e) and (f) shall be revised to reflect the sale of Additional Shares.
9. Expenses. The Company agrees to pay the following costs and
expenses and all other costs and expenses incident to the performance by it of
its obligations hereunder: (i) the preparation, printing or reproduction, and
filing with the Commission of the Registration Statement (including financial
statements and exhibits thereto), each Prepricing Prospectus Supplement, the
Prospectus, and each amendment or supplement to any of them; (ii) the printing
(or reproduction) and delivery (including postage, air freight charges and
charges for counting and packaging) of such copies of the Registration
Statement, each Prepricing Prospectus Supplement, the Prospectus, and all
amendments or supplements to any of them as may be reasonably requested for use
in connection with the offering and sale of the Shares; (iii) the preparation,
printing, authentication, issuance and delivery of certificates for the Shares,
including any stamp taxes in connection with the original issuance and sale of
the Shares; (iv) if required, the printing (or reproduction) and delivery of
this Agreement, the preliminary and
-20-
21
supplemental Blue Sky Memoranda and all other agreements or documents printed
(or reproduced) and delivered in connection with the offering of the Shares;
(v) the listing of the Shares on the American Stock Exchange; (vi) if required,
the registration or qualification of the Shares for offer and sale under the
securities or Blue Sky laws of the several states as provided in Section 5(g)
hereof (including the reasonable fees, expenses and disbursements of counsel
for the Underwriters relating to the preparation, printing or reproduction, and
delivery of the preliminary and supplemental Blue Sky Memoranda and such
registration and qualification); (vii) if required, the filing fees and the
fees and expenses of counsel for the Underwriters in connection with any
filings required to be made with the National Association of Securities
Dealers, Inc.; (viii) the transportation and other expenses incurred by or on
behalf of Company representatives in connection with presentations to
prospective purchasers of the Shares; and (ix) the fees and expenses of the
Company's accountants and the fees and expenses of counsel (including local and
special counsel) for the Company.
10. Effective Date of Agreement. This Agreement shall become
effective: (i) upon the execution and delivery hereof by the parties hereto;
or (ii) if, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment thereto
to be declared effective before the offering of the Shares may commence, when
notification of the effectiveness of the Registration Statement or such
post-effective amendment has been released by the Commission. Until such time
as this Agreement shall have become effective, it may be terminated by the
Company, by notifying you, or by you, by notifying the Company.
11. Default of Underwriters. If any one or more of the
Underwriters shall fail or refuse to purchase Firm Shares which it or they are
obligated to purchase hereunder on the Closing Date, and the aggregate number
of Firm Shares which such defaulting Underwriter or Underwriters are obligated
but fail or refuse to purchase is not more than one-tenth of the aggregate
number of Firm Shares which the Underwriters are obligated to purchase on the
Closing Date, each non-defaulting Underwriter shall be obligated, severally, in
the proportion which the number of Firm Shares set forth opposite its name in
Schedule I hereto bears to the aggregate number of Firm Shares set forth
opposite the names of all non-defaulting Underwriters or in such other
proportion as you may specify in accordance with Section 20 of the Master
Agreement Among Underwriters of Xxxxx Xxxxxx Inc., to purchase the Firm Shares
which such defaulting Underwriter or Underwriters are obligated, but fail or
refuse, to purchase. If any one or more of the Underwriters shall fail or
refuse to purchase Firm Shares which it or they are obligated to purchase on
the Closing Date and the aggregate number of Firm Shares with respect to which
such default occurs is more than one-tenth of the aggregate number of Firm
Shares which the Underwriters are obligated to purchase on the Closing Date and
arrangements satisfactory to you and the Company for the purchase of such Firm
Shares by one or more non-defaulting Underwriters or other party or parties
approved by you and the Company are not made within 36 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Company. In any such case which does not
result in termination of this Agreement, either you or the Company shall have
the right to postpone the Closing Date, but in no event for longer than seven
days, in order that the required changes, if any, in the Registration Statement
and the Prospectus or any other documents or arrangements may be effected. Any
action taken under this paragraph shall not relieve any defaulting Underwriter
from liability in respect of any such default of any such Underwriter under
this Agreement. The term "Underwriter" as used in this Agreement includes, for
all purposes of this
-21-
22
Agreement, any party not listed in Schedule I hereto who, with your approval
and the approval of the Company, purchases Shares which a defaulting
Underwriter is obligated, but fails or refuses, to purchase.
Any notice under this Section 11 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
12. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Company, by notice to the Company, if prior to the Closing
Date or any Option Closing Date (if different from the Closing Date and then
only as to the Additional Shares), as the case may be, (i) trading in
securities generally on the New York Stock Exchange, the American Stock
Exchange or the Nasdaq National Market shall have been suspended or materially
limited, (ii) a general moratorium on commercial banking activities in New York
or Pennsylvania shall have been declared by either federal or state
authorities, or (iii) there shall have occurred any outbreak or escalation of
hostilities or other international or domestic calamity, crisis or change in
political, financial or economic conditions, the effect of which on the
financial markets of the United States is such as to make it, in your judgment,
impracticable or inadvisable to commence or continue the offering of the Shares
at the offering price to the public set forth on the cover page of the
Prospectus or to enforce contracts for the resale of the Shares by the
Underwriters. Notice of such termination may be given to the Company by
telegram, telecopy or telephone and shall be subsequently confirmed by letter.
13. Information Furnished by the Underwriters. The Company and
the Operating Partnership acknowledge and agree that the statements set forth
in the last paragraph on the cover page, the stabilization legend on the inside
cover page, the list of Underwriters and their respective allotments appearing
under the caption "Underwriting" in the Prospectus and the statements in the
first and third paragraphs under the caption "Underwriting" in any Prepricing
Prospectus and in the Prospectus, constitute the only information furnished by
or on behalf of the Underwriters as such information is referred to in Sections
6(b) and 7 hereof.
14. Miscellaneous. Except as otherwise provided in Sections 6, 11
and 12 hereof, notice given pursuant to any provision of this Agreement shall
be in writing and shall be delivered (i) if to the Company or the Operating
Partnership, at the office of the Company at 00 Xxxxxx Xxxxxxxxx, Xxxxxxx
Xxxxxx, Xxxxxxxxxxxx 00000, Attention: Xxxxxx X. Xxxxxxx, President and Chief
Executive Officer; or (ii) if to you, in care of Xxxxx Xxxxxx Inc., 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Manager, Investment
Banking Division.
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Company, its trustees and officers, the Operating
Partnership and the other controlling persons referred to in Section 7 hereof
and their respective successors and assigns, to the extent provided herein, and
no other person shall acquire or have any right under or by virtue of this
Agreement. Neither the term "successor" nor the term "successors and assigns"
as used in this Agreement shall include a purchaser from any Underwriter of any
of the Shares in his status as such purchaser.
-22-
23
15. Applicable Law; Counterparts. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York
applicable to contracts made and to be performed within the State of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
-23-
24
Please confirm that the foregoing correctly sets forth the agreement
among the Company, the Operating Partnership and the several Underwriters.
Very truly yours,
BRANDYWINE REALTY TRUST
By: .....................................
Xxxxxx X. Xxxxxxx
President and Chief Executive Officer
BRANDYWINE OPERATING PARTNERSHIP, L.P.
By: Brandywine Realty Trust,
its general partner
By: .............................
Xxxxxx X. Xxxxxxx
President and Chief Executive
Officer
Confirmed as of the date first
above mentioned.
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
As Underwriters
By: XXXXX XXXXXX INC.
By:....................................
Managing Director
-24-
25
SCHEDULE I
BRANDYWINE REALTY TRUST
Number of
Underwriter Firm Shares
----------- -----------
Xxxxx Xxxxxx Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 1,100,000
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated . . . . . . . . . . . . . . . 1,100,000
---------
Total . . . . . . . . . . . . . . . . . . . . . . . . 2,200,000
=========
26
SCHEDULE 6(e)
Subsidiaries of the Company
Brandywine Operating Partnership, a Delaware limited partnership
Fifteen Horsham, L.P., a Pennsylvania limited partnership
C/N Oaklands Limited Partnership I, a Pennsylvania limited partnership
Newtech IV Limited Partnership, a Pennsylvania limited partnership
Newtech III Limited Partnership, a Pennsylvania limited partnership
LC/N Xxxxx Valley Limited Partnership I, a Pennsylvania limited partnership
LC/N Horsham Limited Partnership, a Pennsylvania limited partnership
Xxxxxxx Landsdale Limited Partnership III, a Pennsylvania limited partnership
Xxxxxx Operating Partnership I, L.P., a Delaware limited partnership
C/N Leedom Limited Partnership II, a Pennsylvania limited partnership
C/N Oaklands Limited Partnership III, a Pennsylvania limited partnership
Iron Run Limited Partnership V, a Pennsylvania limited partnership
C/N Iron Run Limited Partnership III, a Pennsylvania limited partnership
Brandywine Realty Partners, a Pennsylvania general partnership
Brandywine Holdings I, Inc., a Pennsylvania corporation
Brandywine Holdings II, Inc., a Pennsylvania corporation
Brandywine Holdings III, Inc., a Pennsylvania corporation
Brandywine Realty Services Corporation, a Pennsylvania corporation
Brandywine - Main Street, LLC, a Delaware limited liability company
Brandywine Acquisitions, LLC, a Delaware limited liablity company
27
SCHEDULE 6(g)
Ownership Interests in Subsidiaries
See Attached
28
SCHEDULE 6(g)
SUBSIDIARIES
====================================================================================================================================
PARTNERS
PARTNERSHIP SUBSIDIARIES (CAPITAL/PROFITS)
------------------------------------------------------------------------------------------------------------------------------------
Brandywine Operating Partnership, a Delaware limited partnership BRT -- G.P. - 95.379%
BRT -- L.P. - 1.00% (1)
Class A (other than BRT) - L.P. - 3.621%
------------------------------------------------------------------------------------------------------------------------------------
Fifteen Horsham, L.P., a Pennsylvania limited partnership WOP -- G.P. - 1% (2)
BOP -- L.P. 1% (3)
WOP -- L.P. - 98%
------------------------------------------------------------------------------------------------------------------------------------
C/N Oaklands Limited Partnership I, a Pennsylvania limited partnership WOP -- G.P. - 88.9% / 98.9%
BOP -- L.P. - .1% / .1%
TNC -- L.P. - 11% / 1% (4)
------------------------------------------------------------------------------------------------------------------------------------
Newtech IV Limited Partnership, a Pennsylvania limited partnership WOP -- G.P. - 88.9% / 98.9%
BOP -- L.P. - .1% / .1%
TNC -- L.P. - 11% / 1%
------------------------------------------------------------------------------------------------------------------------------------
Newtech III Limited Partnership, a Pennsylvania limited partnership WOP -- G.P. - 88.9% / 63.9%
BOP -- L.P. - .1% / .1%
TNC -- L.P. - 11% / 1%
N.E. Leasing -- 0% / 35% (5)
------------------------------------------------------------------------------------------------------------------------------------
LC/N Xxxxx Valley Limited Partnership I, a Pennsylvania limited partnership WOP -- G.P. - 88.9% / 98.9%
BOP -- L.P. - .1% / .1%
TNC -- L.P. - 11% / 1%
------------------------------------------------------------------------------------------------------------------------------------
LC/N Horsham Limited Partnership, a Pennsylvania limited partnership WOP -- G.P. - 88.9% / 98.9%
BOP -- L.P. - .1% / .1%
TNC -- L.P. - 11% / 1%
------------------------------------------------------------------------------------------------------------------------------------
Xxxxxxx Lansdale Limited Partnership III, a Pennsylvania limited partnership WOP -- G.P. - 88.9% / 98.9%
BOP -- L.P. - .1% / .1%
TNC -- L.P. - 11% / 1%
------------------------------------------------------------------------------------------------------------------------------------
Xxxxxx Operating Partnership I, L.P., a Delaware limited partnership Brandywine Holdings I, Inc. -- G.P. - 1%/1%
BOP -- L.P. - 99%/99%
------------------------------------------------------------------------------------------------------------------------------------
C/N Leedom Limited Partnership II, a Pennsylvania limited partnership BOP -- 89% / 99%
SSI -- L.P. - 11% / 1% (6)
------------------------------------------------------------------------------------------------------------------------------------
C/N Oaklands Limited Partnership III, a Pennsylvania limited partnership Brandywine Holdings II-G.P. --
2% / 2% (7)
BOP -- L.P. - 87% / 97%
TNC -- L.P. - 11% / 1%
------------------------------------------------------------------------------------------------------------------------------------
Iron Run Limited Partnership V, a Pennsylvania limited partnership Brandywine Holdings III-G.P. -- 2% / 2% (7)
BOP -- L.P. - 87% / 97%
TNC -- L.P. - 11% / 1%
------------------------------------------------------------------------------------------------------------------------------------
C/N Iron Run Limited Partnership III, a Pennsylvania limited partnership BOP -- G.P. - 2% / 2%
BOP -- L.P. - 87% / 97%
TNC -- L.P. - 11% / 1%
------------------------------------------------------------------------------------------------------------------------------------
Brandywine Realty Partners, a Pennsylvania general partnership BOP -- G.P. - 49% / 97%
BRT -- G.P. - 21% / 1% (8)
Outside partner -- 30% / 2%
====================================================================================================================================
1. BRT and Brandywine Holdings I, Inc. (a Pennsylvania
corporation and a wholly-owned subsidiary of BRT) collectively
own Class A Units that constitute the percentage shown above.
2. Brandywine Holdings I, Inc. (a Pennsylvania corp. and a
wholly-owned subsidiary of BRT) is General Partner of WOP with
a 1%/1% interest.
X-0
00
0. Brandywine Operating Partnership ("BOP") is a Delaware limited
partnership.
4. The Xxxxxxx Company ("TNC") is a Pennsylvania corporation.
5. N. E. Leasing is not an affiliate. N.E. Leasing is entitled to
35% of the partnership's residual cash flow. "Residual Cash
Flow" upon the sale of the property equals the gross sales
price less (i) outstanding indebtedness, (ii) reserves and
(iii) repayment of capital and accrued equity of WOP, BRT
Xxxxxx and TNC (estimated to equal $1,338,468 as of July 1,
1996).
6. Safeguard Scientifics, Inc. ("SSI") is a Pennsylvania
corporation.
7. A Pennsylvania corporation and a wholly-owned subsidiary of
BRT.
8. BRT has retained a 21% capital interest and a 1% profits
interest for 1 year after closing (i.e. until 8/23/97), at
which time BRT will convey these interests to BOP.
====================================================================================================================================
CORPORATE SUBSIDIARIES SHAREHOLDERS
------------------------------------------------------------------------------------------------------------------------------------
Brandywine Holdings, I, Inc., a Pennsylvania corporation BRT -- 100%
------------------------------------------------------------------------------------------------------------------------------------
Brandywine Holdings II, Inc., a Pennsylvania corporation BRT -- 100%
------------------------------------------------------------------------------------------------------------------------------------
Brandywine Holdings III, Inc., a Pennsylvania corporation BRT -- 100%
------------------------------------------------------------------------------------------------------------------------------------
Brandywine Realty Services Corporation, a Pennsylvania corporation BRT -- 9,473 Preferred Shares
27 Common Shares
BRSP(1) -- 500 Common Shares
====================================================================================================================================
1. BRSP is Brandywine Reatly Services Partnership.
===================================================================================================================================
LIMITED LIABILITY COMPANY SUBSIDIARIES MEMBERS
-----------------------------------------------------------------------------------------------------------------------------------
Brandywine Acquisitions, LLC, a Delaware limited liability company ("BA") BOP -- 100%
-----------------------------------------------------------------------------------------------------------------------------------
Brandywine - Main Street, LLC, a Delaware limited liability company BOP -- 99%
BA - 1%
===================================================================================================================================
E-2
30
EXHIBIT 8(c)
March 4, 1997
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
c/o XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Brandywine Realty Trust Public Offering of
2,200,000 Common Shares of Beneficial
Interest, $0.01 par value per share,
pursuant to Registration Statement on
Form S-3 (Registration No. 333-2991)
Ladies and Gentlemen:
We have acted as counsel to Brandywine Realty Trust, a Maryland real
estate investment trust (the "Company"), in connection with the execution and
delivery by the Company of the Underwriting Agreement dated February 26, 1997
(the "Agreement") by and among the Company, Brandywine Operating Partnership,
L.P., a Delaware limited partnership (the "Operating Partnership"), and Xxxxx
Xxxxxx Inc. and Xxxx Xxxxx Xxxx Xxxxxx, Incorporated, as underwriters (the
"Underwriters"), and the filing by the Company with the United States Securities
and Exchange Commission pursuant to the Securities Act of 1933, as amended (the
"Act"), of the Company's Registration Statement on Form S-3 (No. 333- 2991)
(together with all pre- and post-effective amendments thereto to date, the
"Registration Statement"), relating to the sale by the Company of 2,200,00
common shares (the "Firm Shares") of beneficial interest, $0.01 par value (the
"Common Shares") of the Company, and an additional 330,000 Common Shares (the
"Additional Shares") which may be purchased by the Underwriters solely to cover
over-allotments. The Firm Shares and the Additional Shares are hereinafter
collectively referred to as the "Shares."
31
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
Page 2
March 4, 1997
This opinion is delivered to you pursuant to Section 8(c) of the
Agreement. Capitalized terms used herein but not otherwise defined herein have
the meanings ascribed to them in the Agreement.
In connection with this opinion, we have examined the Agreement, the
Registration Statement, each Prepricing Prospectus, the Prospectus, originals,
or copies reproduced or certified to our satisfaction, of such trust, corporate
and partnership organizational documents, agreements, records and other
documents of the Company and each subsidiary identified on Schedule 6(e) to the
Agreement (collectively, the "Subsidiaries"), the instruments and documents
delivered at the Closing, and such other documents, records and instruments as
we have deemed necessary to form the basis for the opinions hereinafter
expressed. We have also made such examination of laws, of certificates of public
officials and of certificates of officers of the Company and the Subsidiaries,
and investigations of fact, as we have deemed necessary to enable us to render
this opinion. As to matters of fact relevant to the opinions herein expressed,
we have assumed the accuracy and completeness of, and have relied solely upon,
the representations and warranties of the Company and the Operating Partnership
contained in the Agreement and in such certificates of officers of the Company
or the Subsidiaries (including, without limitation, the certificate attached
hereto as Exhibit A (the "Officer's Certificate")) and certificates of public
officials.
Where matters are stated to be "to our knowledge" or otherwise known
to us or words of similar import, our knowledge is limited to the actual
knowledge of those attorneys in our office who have directly participated in the
transactions contemplated by the Agreement and the documents listed on Exhibit B
(collectively, the "Transaction Documents"), the review of documents provided to
us by the Company, the Operating Partnership and the Subsidiaries in connection
with such transactions and inquiries of officers of the Company, the Operating
Partnership, and the Subsidiaries, the results of which are reflected in the
Officer's Certificate. We have not independently verified the accuracy of the
matters set forth in the written statements or certificates upon which we have
relied, nor have we undertaken any lien, intellectual property, suit or
32
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
Page 3
March 4, 1997
judgment searches or searches of court dockets in any jurisdiction.
We have assumed: (i) the due execution and delivery, pursuant to due
authorization, of the Agreement by the parties thereto other than the Company
and the Operating Partnership, (ii) the genuineness of the signatures of, and
the authority of, persons signing the Agreement on behalf of all parties thereto
other than the Company and the Operating Partnership, (iii) the genuineness of
all signatures and the authenticity and completeness of all records,
certificates, instruments and documents submitted to us as originals and (iv)
the conformity to authentic originals of all records, certificates, instruments
and documents submitted to us as certified, conformed, photostatic or facsimile
copies thereof.
No opinion is rendered as to matters not specifically referred to
herein and under no circumstances are you to infer from anything stated or not
stated herein any opinion with respect to which such reference is not made.
We have further assumed that the consideration required to be paid
for the issuance of the Shares and the outstanding Common Shares and preferred
shares of beneficial interest, par value $.01 per share ("Preferred Shares")
pursuant to resolutions of the Board of Trustees of the Company authorizing the
issuance of those securities has in fact been paid to and received by the
Company.
Statements in this opinion as to the legality, validity, binding
effect or enforceability of agreements, instruments and documents are subject
(i) to limitations as to enforceability imposed by bankruptcy, reorganization,
moratorium, fraudulent conveyance, insolvency and other similar laws and related
court decisions of general application relating to or affecting creditors'
rights generally, (ii) to equitable principles limiting the availability of
equitable remedies, and (iii) as to rights to indemnity and contribution, to
limitations that may exist under federal and state laws or the public policy
underlying such laws.
Insofar as, and to the extent, this opinion relates to matters
governed by the laws of the State of Maryland in
33
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
Page 4
March 4, 1997
paragraphs 1, 3, 4, 8, 9, 10, 11 and 16 below, we have relied solely upon, and
such opinions are subject to the limitations and assumptions contained in, the
opinion of Xxxxxxx Xxxxx Xxxxxxx & Ingersoll addressed to you, dated the date
hereof, a copy of which is attached hereto as Exhibit C and is being delivered
to you contemporaneously with this opinion. We believe that both we and you are
justified in relying upon such opinion.
Except as indicated above with respect to Maryland law, this opinion
is limited solely to matters governed by the laws of the Commonwealth of
Pennsylvania, the Delaware General Corporation Law, the Delaware Revised Uniform
Limited Partnership Act and the federal laws of the United States, without
regard to conflict or choice of law principles, and the references herein to
laws, statutes and regulations shall be interpreted consistent with such
limitation. In rendering our opinion as to the enforceability of the Agreement
in paragraph 8, we have assumed that New York law is the same as Pennsylvania
law and the Delaware General Corporation Law.
Based upon and subject to the foregoing and the qualifications and
limitations set forth below, we are of the opinion that:
1. The Company is a real estate investment trust duly formed and
existing under and by virtue of the laws of the State of Maryland and is in good
standing with the State Department of Assessments and Taxation of Maryland. The
Company has the full trust power and authority to own, lease and operate its
properties and to conduct its business substantially as described in the
Registration Statement and the Prospectus and is duly registered and qualified
to conduct its business and is in good standing in each jurisdiction or place
where the nature of its properties or the conduct of its business as described
in the Registration Statement and the Prospectus requires such registration or
qualification, except where the failure to so qualify would not have a material
adverse effect on the condition (financial or otherwise), business, prospects,
properties, net worth or results of operations of the Company.
2. Each of the Subsidiaries is a corporation, limited partnership
or general partnership presently subsisting or in good standing, as the case may
be, under the laws of its
34
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
Page 5
March 4, 1997
jurisdiction of incorporation or formation, with full corporate or partnership
power and authority, as the case may be, to own, lease, and operate its
properties and to conduct its business as described in the Registration
Statement and the Prospectus, and is duly registered and qualified to conduct
its business in each jurisdiction or place where the nature of its properties or
the conduct of its business as described in the Registration Statement and the
Prospectus requires such registration or qualification, except where the failure
to so qualify would not have a material adverse effect on the condition
(financial or otherwise), business, prospects, properties, net worth or results
of operations of such Subsidiary.
3. The authorized beneficial interest of the Company (including,
but not limited to, any options, warrants or other securities convertible into
or exchangeable shares of beneficial interest of the Company) conforms in all
material respects to the description thereof in the Registration Statement and
the Prospectus and in Exhibit D hereto. All the outstanding shares of beneficial
interest of the Company outstanding prior to the issuance of the Shares have
been duly authorized and validly issued, are fully-paid and nonassessable, and
are free of any preemptive or similar statutory rights under Maryland law.
4. The Shares have been duly authorized and, when issued and
delivered to the Underwriters against payment therefor in accordance with the
terms of the Agreement, will be validly issued, fully-paid and nonassessable and
free of any preemptive or similar statutory rights under Maryland law.
5. To our knowledge, except as set forth on Exhibit D hereto,
there are no outstanding options, warrants or other written rights calling for
the issuance of, or any written commitment, plan or arrangement to issue, any
shares of beneficial interest of the Company or any security convertible into or
exchangeable or exercisable for shares of beneficial interest of the Company. To
our knowledge, there is no holder of any security of the Company or any other
person who has the right, contractual or otherwise, to cause the Company to sell
or otherwise issue to him, or to permit him to underwrite the sale of, the
Shares or the right to have any Common Shares or other securities of the Company
included in the Registration Statement or the right, as a result of the filing
of the Registration
35
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
Page 6
March 4, 1997
Statement or sale of the Shares as provided in the Agreement, to require
registration under the Act of any Common Shares or other securities of the
Company.
6. All of the outstanding units of limited and general
partnership interests of the Operating Partnership (the "Units"), and the
partnership interests in each of the other Subsidiaries that is a partnership,
were created under the agreements forming the Operating Partnership and such
other Subsidiaries, as the case may be, and all of the issued and outstanding
shares of capital stock of each of the Subsidiaries that is a corporation have
been duly authorized and validly issued, and are fully paid and nonassessable.
To our knowledge, except as described in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), all such Units, partnership
interests and shares of capital stock are owned by the Company directly, or
indirectly through one of the Subsidiaries, free and clear of any security
interest, lien, adverse claim, equity or other encumbrance, and, to our
knowledge, the Company's ownership interest in the Operating Partnership, and
the Company's and the Operating Partnership's respective ownership interest in
each of the Subsidiaries, is as set forth on Exhibit E attached hereto (without
giving effect to the issuance of the Shares). To our knowledge, except as
described in the Registration Statement and the Prospectus (or any amendment or
supplement thereto), there are no outstanding options, warrants or other written
rights calling for the issuance of, or any written commitment, plan or
arrangement to issue, any equity interests in any Subsidiary, or any security
convertible into or exchangeable or exercisable for any such interests in any
such Subsidiary. The terms of the Units conform in all material respects to
statements and descriptions thereof contained in the Registration Statement and
the Prospectus. The Company is the sole general partner of the Operating
Partnership.
7. All offers and sales of Units by the Operating Partnership and
the offers and sales by the Company of Common Shares, in each case prior to the
Effective Date as described in the Registration Statement and the Prospectus,
have been duly registered under the Act, or were issued in transactions exempt
from the registration requirements of the Act.
36
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
Page 7
March 4, 1997
8. The Company has the full trust power and authority, and the
Operating Partnership has the requisite partnership power and authority, to
enter into the Agreement and each Transaction Document to which it is a party
and, in the case of the Company, to issue, sell and deliver the Shares to the
Underwriters as provided in the Agreement, and each of the Agreement and each
Transaction Document has been duly and validly authorized, executed and
delivered by the Company and the Operating Partnership, as applicable, and is
the legal, valid and binding agreement of each of the Company and the Operating
Partnership, as applicable, enforceable against them in accordance with its
terms.
9. The form of certificate representing the Common Shares is in
due and proper form and complies with all applicable Maryland statutory
requirements.
10. To our knowledge, neither the Company nor any of the
Subsidiaries is in violation of its respective Declaration of Trust, certificate
or articles of incorporation or bylaws, partnership agreement or other
organizational documents or is in default in the performance of any material
obligation, agreement or condition contained in any bond, debenture, note or
other evidence of indebtedness.
11. With respect to the Company and the Subsidiaries, neither the
offer, sale or delivery of the Shares, the execution, delivery or performance of
the Agreement, nor the consummation of the transactions contemplated thereby by
the Company or the Subsidiaries, as applicable: (i) required or requires, with
respect to the Company or the Subsidiaries, any consent, approval, authorization
or other order of, or registration or filing with, any court, regulatory body,
administrative agency or other governmental body, agency or official, or the
American Stock Exchange (except (a) such as has been made or obtained, (b)
clearance by the National Association of Securities Dealers, Inc. in connection
with the purchase and sale of the Shares by the Underwriters (as to which we
express no opinion) and (c) as to state securities or Blue Sky laws, as to which
we express no opinion); (ii) conflicted with, conflicts with or will conflict
with or constitutes or will constitute a breach of, or a default under, the
Declaration of Trust, Articles Supplementary, certificate or articles of
incorporation or bylaws, partnership
37
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XXXX XXXXX XXXX XXXXXX, INCORPORATED
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March 4, 1997
agreement or other organizational documents, of any of such entities, or under
any material agreement or instrument known to us at the time the Registration
Statement was declared effective, which in each case has been filed as an
exhibit to the Registration Statement to which any of such entities is a party
or by which any of them or any of their respective properties or assets are
bound; (iii) violated, violates or will violate any statute, law, regulation or,
to our knowledge, ruling, judgment, injunction, order or decree applicable to
any of such entities or any of their respective properties or assets; or (iv) to
our knowledge, resulted or will result in the creation or imposition of any
material lien, charge or encumbrance upon the property or assets of any of such
entities pursuant to the terms of any agreement or instrument to which any of
them is a party or by which any of them may be bound or to which any of the
property or assets of any of them is subject.
12. Neither the Company nor any of the Subsidiaries is required to
be registered under the Investment Company Act of 1940, as amended.
13. To our knowledge, (i) there are no proceedings pending or
threatened against the Company or any of the Subsidiaries or any of their
respective trustees, directors or officers in their capacity as such, or to
which the Company or any of the Subsidiaries or any of their respective
trustees, directors or officers in their capacity as such, or any of their
respective properties or assets, is subject, that are of a character which is
required to be described in the Registration Statement or Prospectus (or any
amendment or supplement thereto) and (ii) there are no agreements, contracts,
indentures, leases or other instruments, that are required to be described in
the Registration Statement or the Prospectus (or any amendment or supplement
thereto) or to be filed as an exhibit to the Registration Statement that are not
described or filed as required by the Act.
14. To our knowledge and assuming the application of the net
proceeds of the Offering in a manner consistent with the statements in the
Prospectus under the heading "Use of Proceeds," and except as described in or
contemplated by the Prospectus, none of the Subsidiaries is contractually
prohibited, directly or indirectly, from paying any dividends or distributions
to the
38
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XXXX XXXXX XXXX XXXXXX, INCORPORATED
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March 4, 1997
Company, from making any other distribution on such Subsidiary's capital stock
or other equity interests, from repaying to the Company any loans or advances to
such Subsidiary from the Company or from transferring any of such Subsidiary's
property or assets to the Company or any of the other Subsidiaries.
15. The Registration Statement and the Prospectus and any
supplements or amendments thereto (except for the financial statements and the
notes thereto and the schedules and other financial, accounting and statistical
data included therein or excluded therefrom, as to which we do not express any
opinion) comply as to form in all material respects with the requirements of the
Act, except that we express no opinion, view or belief as to the exhibits (or
form thereof) to the Registration Statement, or to the accuracy, completeness or
fairness of the statements contained in the Registration Statement except as and
to the extent expressly set forth in paragraph 16 hereof.
16. The statements in the Registration Statement and Prospectus
set forth under the headings "Recent Developments Pending Acquisitions,"
"Description of Shares of Beneficial Interest" and "Certain Provisions of
Maryland Law and of the Company's Declaration of Trust and Bylaws" in the
Prospectus, to the extent they constitute matters of law or descriptions or
summaries of contracts, agreements or other legal documents, or refer to or
constitute statements of matters of law, descriptions of statutes, rules or
regulations, or legal conclusions, each, respectively, fairly presents in all
material respects the information disclosed therein. The descriptions of
agreements that are summarized in the Prospectus dated November 25, 1996 and
incorporated by reference in the Registration Statement under the headings
"Operating Partnership Agreement" and "BRP General Partnership Agreement" (other
than in respect of the number of outstanding GP Units and Class A Units and the
ownership thereof) conform in all material respects to the provisions of such
agreements and each such description, respectively, fairly presents in all
material respects the information contained therein and required to be therein
disclosed.
We have been advised by the staff of the Commission that the
Registration Statement and all post-effective amendments, if any, have become
effective under the Act as of February 14, 1997 and, to our knowledge after
reasonable inquiry,
39
XXXXX XXXXXX INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
Page 10
March 4, 1997
no stop order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose are pending before or
contemplated by the Commission, and any required filing of the Prospectus has
been made.
We have been advised by the American Stock Exchange, Inc. that the
Shares are duly authorized for listing, subject to official notice of issuance.
In addition, we hereby advise you that we have participated in
conferences with officers and other representatives of the Company, the
Operating Partnership and the other Subsidiaries, representatives of the
Company's independent public accountants and you and your counsel in connection
with the preparation of the Registration Statement at which the contents of the
Registration Statement, the Prospectus therein, and related matters were
reviewed and discussed and, although we have not verified independently and,
therefore, do not assume any responsibility, explicitly or implicitly, for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus (except as and to the extent expressly
set forth in paragraph 16), on the basis of the foregoing, nothing has come to
our attention that has caused us to believe that the Registration Statement, at
the time the Registration Statement became effective, contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or
that the Prospectus (or an amendment or supplement thereto), as of their
respective dates and as of the date hereof, contained any untrue statement of a
material fact or omitted to state a material fact necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading (it being understood that no opinion, view or belief is hereby
expressed with respect to the financial statements and the notes thereto and the
schedules and other financial, accounting and statistical data included in or
excluded from the Registration Statement or the Prospectus or as to the exhibits
(or the form thereof) to the Registration Statement).
The opinions expressed in paragraph numbers (1) through (16) above
are subject in all respects to the following additional qualifications:
40
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March 4, 1997
1. We have assumed that the parties to the Agreement and the
Transaction Documents, other than the Company and the Operating Partnership,
have complied and will continue to comply with all requirements of good faith,
fair dealing and conscionability, and have acted and will continue to act in a
commercially reasonable manner, and that there has not been any mutual mistake
of fact or misunderstanding, fraud, duress or undue influence between the
parties to the Agreement or the Transaction Documents.
2. No opinion is given as to the right to exercise remedies upon
the happening of a non-material breach of the Agreement or any of the
Transaction Documents (including material breaches of non-material provisions).
3. We express no opinion as to the effect of other agreements or
understandings among the parties, written or oral, which are not known to us, or
any usage of trade or course of prior dealing among the parties or whether, in
either case, any of the foregoing would define, supplement or qualify the terms
of the Agreement or any of the Transaction Documents.
4. No opinion is given as to any provision in the Agreement or
any of the Transaction Documents that purports to:
a. Require the payment or reimbursement of any fee, cost,
expense or other item that is unreasonable in nature or amount;
b. Preclude modification of the Agreement or any of the
Transaction Documents through conduct, custom or course of performance, action
or dealing; or
c. Define, waive or set standards for good faith,
reasonableness, commercial reasonableness, fair dealing, diligence or the like.
This opinion is rendered only to the addressees set forth above and
is solely for the benefit of such addressees and may not be quoted to or relied
upon by any other person or entity
41
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March 4, 1997
without the express written prior consent of a partner of this firm.
Very truly yours,
PEPPER, XXXXXXXX & XXXXXXX LLP
By:_______________________
A Partner
42
Exhibit 8(g)
Additional Text of Closing Date Comfort Letter
d. With respect to the three-month periods ended December 31, 1995
and 1996, we have:
(i) Read the unaudited results of operations - operating
data for the three-month periods ended December 31, 1995
and 1996, as set forth on Page 54 of the Prospectus
Supplement dated February 26, 1997.
(ii) Performed the procedures specified by the American
Institute of Certified Public Accountants for a review
of interim financial information as described in SAS No.
71, Interim Financial Information, on the attached
unaudited consolidated balance sheets as of December 31,
1995 and 1996 and the unaudited condensed consolidated
statements of operations, beneficiaries' equity and cash
flows for the three-month periods ended December 31,
1995 and 1996 from which the unaudited amounts referred
to in 7d(i) are derived.
(iii) Inquired of certain officials of the Company who have
responsibility for financial and accounting matters
whether (a) the unaudited results of operations -
operating data referred to in 7d(i) and the unaudited
consolidated financial statements referred to in 7d(ii)
are stated on a basis substantially consistent with that
of the corresponding amounts in the audited consolidated
financial statements of the Company incorporated by
reference in the Registration Statement and (b) the
unaudited results of operations - operating data and the
unaudited financial statements referred to in 7d(i) and
7d(ii), respectively, comply as to form in all material
respects with the applicable accounting requirements of
the Act, the Exchange Act, and the related published
rules and regulations.
The foregoing procedures do not constitute an audit conducted in
accordance with generally accepted auditing standards. Also, they would
not necessarily reveal matters of significance with respect to the
comments in the following paragraph. Accordingly, we make no
representations regarding the sufficiency of the foregoing procedures
for your purposes.
8. Nothing came to our attention as a result of the foregoing procedures,
however, that caused us to believe that:
(i) Any material modifications should be made to the
unaudited results of operations - operating data
or the unaudited financial statements described
in 7d(i) and 7d(ii), respectively, for them to
be in conformity with generally accepted
accounting principles.
(ii) The unaudited results of operations - operating
data or the unaudited financial statements
described in 7d(i) and 7d(ii),
43
respectively, do not comply as to form in all
material respects with the applicable accounting
requirements of the Act, the Exchange Act and
the related published rules and regulations.
(iii) At December 31, 1996, there was any change in
the capital stock, increase in long-term debt,
or decrease in consolidated net assets or
beneficiaries' equity of the Company as compared
with amounts shown in the September 30, 1996,
unaudited balance sheet incorporated by
reference in the Registration Statement, or for
the period from October 1, 1996 to December 31,
1996, there were any decreases, as compared to
the corresponding period in the preceding year,
in revenues or in the total or per-share amounts
of income before extraordinary items or of net
income, except in all instances for changes,
increases or decreases that the Registration
Statement discloses have occurred or may occur.
9. Company officials have advised us that no consolidated financial
statements of the Company as of any date or for any period subsequent to
December 31, 1996, are available; accordingly, the procedures carried
out by us with respect to changes in financial statement items after
December 31, 1996, have been, of necessity, even more limited than those
with respect to the periods referred to in 7d. We have inquired of
certain officials of the Company who have responsibility for financial
and accounting matters whether (a) at February 21, 1997, there was any
change in the capital stock, increase in long-term debt or any decreases
in consolidated total assets or beneficiaries' equity of the Company as
compared with amounts shown on the December 31, 1996 unaudited
consolidated balance sheet attached to this letter, or (b) for the
period from January 1, 1997, to February 1, 1997, there were any
decreases, as compared with the corresponding period in the preceding
year, in revenue or in the total or per share amounts of income before
extraordinary items or of net income. On the basis of these inquiries
and our reading of the minutes, nothing came to our attention that
caused us to believe that there was any such change, increase, or
decrease, except in all instances for changes, increases, or decreases
that the Registration Statement discloses have occurred or may occur and
except (i) for the increase in long-term debt to $53,530,000 (as a
result of the assumption of debt in connection with the acquisition of
the Columbia Properties) as of February 21, 1997 and (ii) that officials
of the Company have informed us that they are unable to determine
whether there were any decreases in the total or per share amounts of
income before extraordinary items or of net income for the period from
January 1, 1997 through February 21, 1997, inclusive, and the
corresponding period in the preceding year, because no complete
consolidated financial statements as of any date or for any period
subsequent to December 31, 1996 are available.
