EXHIBIT 1.1
FORM OF
XXXXXXX MALL PROPERTIES, INC.
10,666,667 Shares of Common Stock
UNDERWRITING AGREEMENT
_________, 2004
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
as Representative of the several Underwriters
0000 00xx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Dear Sirs:
XXXXXXX MALL PROPERTIES, INC., a Maryland corporation (the "Company"),
and XXXXXXX EQUITIES OPERATING PARTNERSHIP, LP, a Delaware limited partnership
(the "Operating Partnership"), each confirms its agreement with each of the
Underwriters listed on Schedule I hereto (collectively, the "Underwriters") for
whom Friedman, Billings, Xxxxxx & Co., Inc. is acting as representative (the
"Representative") with respect to (i) the sale by the Company to the
Underwriters of 10,666,667 shares (the "Initial Shares") of Common Stock, par
value $0.01 per share, of the Company ("Common Stock") in the respective numbers
of shares set forth opposite the names of the Underwriters in Schedule I hereto,
and the purchase by the Underwriters, acting severally and not jointly, of the
respective number of shares of Common Stock set forth opposite their names in
Schedule I hereto, and (ii) the grant by the Company to the Underwriters, acting
severally and not jointly, of the option described in Section 1(b) hereof to
purchase all or any part of 1,600,000 additional shares of Common Stock (the
"Option Shares") to cover over-allotments, if any, in the respective numbers of
shares of Common Stock set forth opposite their names in Schedule I hereto. The
10,666,667 shares of Common Stock to be purchased by the Underwriters and all or
any part of the 1,600,000 shares of Common Stock subject to the option described
in Section l(b) hereof are hereinafter called, collectively, the "Shares."
At the Closing Time (as hereinafter defined) for the purchase and sale
of the Initial Shares, the Company and the Operating Partnership will complete a
series of transactions described in the Prospectus (as hereinafter defined)
under the captions "Structure and Formation of Our Company - The Formation
Transactions" (other than under "- Colonie Center Acquisition" thereunder) and
"Benefits to Related Parties" (such transactions, the "Formation Transactions"
and the agreements to be executed by the Company and/or the Operating
Partnership in connection with such Formation Transactions are referred to as
the "Formation Agreements"). As part of the Formation Transactions, (i) the
Company will contribute the net proceeds from the public offering of the Shares,
directly and/or through one or more wholly-owned subsidiaries of the Company, to
the Operating Partnership in exchange for units of partnership interest in the
Operating Partnership ("OP Units") and (ii) the Operating Partnership will issue
OP Units as described in the Prospectus.
The Company understands that the Underwriters propose to make a public
offering of the Shares as soon as the Underwriters deem advisable after this
Underwriting Agreement (the "Agreement") has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-11 (No. 333-118246) and a
related preliminary prospectus for the registration of the Shares under the
Securities Act of 1933, as amended (the "Securities Act"), and the rules and
regulations thereunder (the "Securities Act Regulations"). The Company has
prepared and filed such amendments thereto, if any, and such amended preliminary
prospectuses (together with the preliminary prospectus referred to in the prior
sentence the "Preliminary Prospectus"), if any, as may have been required to the
date hereof, and will file such additional amendments thereto and such amended
prospectuses as may hereafter be required. The registration statement has been
declared effective under the Securities Act by the Commission. The registration
statement, as amended at the time it became effective (including all information
deemed to be a part of the registration statement at the time it became
effective pursuant to Rule 430A of the Securities Act Regulations), is
hereinafter called the "Registration Statement," except that, if the Company
files a post-effective amendment to such registration statement which becomes
effective prior to the Closing Time (as defined below), "Registration Statement"
shall refer to such registration statement as so amended. Any registration
statement filed pursuant to Rule 462(b) of the Securities Act Regulations is
hereinafter called the "Rule 462(b) Registration Statement," and after such
filing the term "Registration Statement" shall include the 462(b) Registration
Statement. The term "Prospectus" means the final prospectus, as first filed with
the Commission pursuant to paragraph (1) or (4) of Rule 424(b) of the Securities
Act Regulations, and any amendments thereof or supplements thereto.
The Company and the Underwriters agree as follows:
1. Sale and Purchase:
(a) Initial Shares. Upon the basis of the warranties and
representations and other terms and conditions herein set forth, at the purchase
price per share of $[________], the Company agrees to sell to the Underwriters
the number of Initial Shares set forth in Schedule I opposite each Underwriter's
name, and each Underwriter agrees, severally and not jointly, to purchase from
the Company the number of Initial Shares set forth in Schedule I opposite such
Underwriter's name, plus any additional number of Initial Shares that such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 8 hereof, subject, in each case, to such adjustments among the
Underwriters as the Representative in its sole discretion shall make to
eliminate any sales or purchases of fractional shares. Notwithstanding the
foregoing, the purchase price per share of Common Stock paid by the Underwriters
to the Company in respect of any Initial Shares or Option Shares sold to Xxxxx
Xxxxxxx, Xxx Xxxxx, Xxxxxxx Xxxxxx, Xxxxx Xxxxxx or Xxxxxx Xxxxx shall be equal
to the "Public Offering Price" of the Initial Shares set forth on the cover page
of the Prospectus.
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(b) Option Shares. In addition, upon the basis of the warranties and
representations and other terms and conditions herein set forth, at the purchase
price per share set forth in subsection (a) above, the Company hereby grants an
option to the Underwriters, acting severally and not jointly, to purchase from
the Company all or any part of the Option Shares, plus any additional number of
Option Shares that such Underwriter may become obligated to purchase pursuant to
the provisions of Section 8 hereof. The option hereby granted will expire 30
days after the date hereof and may be exercised, from time to time and on one or
more occasions, in whole or in part only for the purpose of covering
over-allotments which may be made in connection with the offering and
distribution of the Initial Shares upon notice by the Representative to the
Company setting forth the number of Option Shares as to which the several
Underwriters are then exercising the option and the time and date of payment and
delivery for such Option Shares. Any such time and date of delivery (a "Date of
Delivery") shall be determined by the Representative, but shall not be later
than three full business days (or earlier, without the consent of the Company,
than two full business days) after the exercise of such option, nor in any event
prior to the Closing Time, as hereinafter defined. If the option is exercised,
on one or more occasions, as to all or any portion of the Option Shares, the
Company will sell and each of the Underwriters, acting severally and not
jointly, will purchase that proportion of the total number of Option Shares then
being purchased, which the number of Initial Shares set forth in Schedule I
opposite the name of such Underwriter bears to the total number of Initial
Shares, subject in each case to such adjustments among the Underwriters as the
Representative in its sole discretion shall make to eliminate any sales or
purchases of fractional shares.
2. Payment and Delivery:
(a) Initial Shares. The Initial Shares to be purchased by each
Underwriter hereunder, in definitive form, and in such authorized denominations
and registered in such names as the Representative may request upon at least 48
hours' prior notice to the Company shall be delivered by or on behalf of the
Company to the Representative, including, at the option of the Representative,
through the facilities of The Depository Trust Company ("DTC") for the account
of such Underwriter, against payment by or on behalf of such Underwriter of the
purchase price therefor by wire transfer of Federal (same-day) funds to the
account specified to the Representative by the Company upon at least 48 hours'
prior notice. The Company will cause the certificates representing the Initial
Shares to be made available for checking and packaging at least 24 hours prior
to the Closing Time (as hereinafter defined) with respect thereto at the office
of the Representative, 0000 00xx Xxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000, or at
the office of DTC or its designated custodian, as the case may be (the
"Designated Office"). The time and date of such delivery and payment shall be
9:30 a.m., New York City time, on the third (fourth, if pricing occurs after
4:30 p.m., New York City time) business day after the date hereof (unless
another time and date shall be agreed to by the Representative and the Company).
The time at which such payment and delivery are actually made is hereinafter
sometimes called the "Closing Time" and the date of delivery of the Initial
Shares and, if applicable, the Option Shares, is hereinafter sometimes called
the "Date of Delivery."
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(b) Option Shares. Any Option Shares to be purchased by each
Underwriter hereunder, in definitive form, and in such authorized denominations
and registered in such names as the Representative may request upon at least two
full business days' notice to the Company shall be delivered by or on behalf of
the Company to the Representative, including, at the option of the
Representative, through the facilities of DTC for the account of such
Underwriters, against payment by or on behalf of such Underwriters of the
purchase price therefor by wire transfer of Federal (same-day) funds to the
account specified in writing to the Representative by the Company upon at least
two full business days' prior notice. The Company will cause the certificates
representing the Option Shares to be made available for checking and packaging
at least 24 hours prior to the Date of Delivery with respect thereto at the
Designated Office. The time and date of such delivery and payment shall be 9:30
a.m., New York City time, on the date specified by the Representative in the
notice given by the Representative to the Company of the Underwriters' election
to purchase such Option Shares or on such other time and date as the Company and
the Representative may agree upon in writing.
3. Representations and Warranties of the Company and the Operating
Partnership:
The Company and the Operating Partnership, jointly and severally,
represent and warrant to each Underwriter that:
(a) (i) as of the date hereof, the Company has an authorized
capitalization as set forth in the Prospectus in the section entitled
"Capitalization" under the heading "Historical Predecessor;" all of the issued
shares of capital stock, the partnership interests, membership interests or
other equity interests, as the case may be, of the Company and each subsidiary
of the Company listed on Schedule II hereto (each, a "Subsidiary"), have been,
or will be when issued upon consummation of the Formation Transactions, duly and
validly authorized and issued and are fully paid and nonassessable; all of the
outstanding shares of capital stock of or the partnership interests, membership
interests or other equity interests in the Subsidiaries (other than the
Operating Partnership), as the case may be, are, or will be upon consummation of
the Formation Transactions, directly or indirectly owned of record and
beneficially by the Company; except as disclosed in the Prospectus, there are no
outstanding (i) securities or obligations of the Company or any of the
Subsidiaries convertible into or exchangeable for any capital stock of or
partnership interests, membership interests or other equity interests, as the
case may be, in the Company or any such Subsidiary, (ii) warrants, rights or
options to subscribe for or purchase from the Company or any Subsidiary any such
capital stock or any such convertible or exchangeable securities or obligations
or (iii) obligations of the Company or any Subsidiary to issue any securities or
obligations, any such convertible or exchangeable securities or obligations, or
any such warrants, rights or options;
(b) each of the Company and the Subsidiaries has been duly incorporated
or organized and is validly existing as a corporation, general or limited
partnership or limited liability company, as the case may be, in good standing
under the laws of its jurisdiction of incorporation or organization with full
corporate, partnership or limited liability company power and authority to own
its properties and to conduct its business as described in the Registration
Statement and Prospectus and in the case of the Company, to execute and deliver
this Agreement and in the case of the Operating Partnership, to execute and
deliver this Agreement and the Formation Agreements to which it is a party and
to consummate the transactions described in each such agreement;
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(c) each of the Company and the Subsidiaries is duly qualified to
conduct business and is in good standing in each jurisdiction in which the
conduct of its business or the ownership of its real property requires such
qualification except for such jurisdictions in which the failure, individually
or in the aggregate, to be so qualified would not reasonably be expected to have
a material adverse effect on the assets, business, operations, earnings,
prospects, properties or condition (financial or otherwise) of the Company and
the Subsidiaries, taken as a whole (any such effect, where the context so
requires, is hereinafter called a "Material Adverse Effect"); except as
disclosed in the Prospectus, no Subsidiary is prohibited or restricted, directly
or indirectly, from paying dividends to the Company, or from making any other
distribution with respect to such Subsidiary's capital stock, partnership
interests, membership interests or other equity interests, as the case may be,
from repaying to the Company or any other Subsidiary any amounts which may from
time to time become due under any loans or advances to such Subsidiary from the
Company or such other Subsidiary, or from transferring any such Subsidiary's
property or assets to the Company or to any other Subsidiary; except as
disclosed in the Prospectus, the Company does not own, directly or indirectly,
any capital stock or other equity securities of any other corporation or any
ownership interest in any partnership, limited liability company, joint venture
or other entity;
(d) the Agreement of Limited Partnership of the Operating Partnership
(the "Partnership Agreement") has been duly and validly authorized, executed and
delivered by or on behalf of the partners of the Operating Partnership and
constitutes a valid and binding agreement of the parties thereto, enforceable in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally or by general principles of equity;
(e) upon completion of the offering of the Shares, the Company and/or
one or more wholly-owned subsidiaries of the Company will be the holder of OP
Units representing an ownership interest in the Operating Partnership in the
amounts described in the Prospectus, free and clear of any pledge, lien,
encumbrance, security interest or other claim and a wholly-owned subsidiary of
the Company will be the sole general partner of the Operating Partnership;
(f) the Company and the Subsidiaries are in compliance in all material
respects with all applicable laws, rules, regulations, orders, decrees and
judgments, including those relating to transactions with affiliates;
(g) neither the Company nor any of the Subsidiaries is in breach of or
in default under (nor has any event occurred which with notice, lapse of time,
or both would constitute a breach of, or default under), its respective
organizational documents, or in the performance or observance of any obligation,
agreement, covenant or condition contained in any license, indenture, mortgage,
deed of trust, loan or credit agreement or other agreement or instrument to
which the Company or any Subsidiary is a party or by which any of them or their
respective properties is bound, except for such breaches or defaults which would
not reasonably be expected to have a Material Adverse Effect;
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(h) the execution, delivery and performance of this Agreement and the
Formation Agreements by the Company and the Operating Partnership (to the extent
a party thereto) and consummation by the Company and the Operating Partnership
(to the extent a party thereto) of the transactions contemplated by this
Agreement and the Formation Agreements do not and will not (A) conflict with, or
result in any breach of, or constitute a default under (nor constitute any event
which with notice, lapse of time, or both would constitute a breach of, or
default under) (i) any provision of the organizational documents of the Company
or any Subsidiary, or (ii) any provision of any license, indenture, mortgage,
deed of trust, loan or credit agreement or other agreement or instrument to
which the Company or any Subsidiary is a party or by which any of them or their
respective assets or properties may be bound or affected, or under any U.S.
federal, state, local or foreign law, regulation or rule or any decree, judgment
or order applicable to the Company or any Subsidiary, except in the case of this
clause (ii) for such breaches or defaults which would not reasonably be expected
to have a Material Adverse Effect or (B) result in the creation or imposition of
any lien, charge, claim or encumbrance upon any property or asset of the Company
or any Subsidiary;
(i) this Agreement has been duly authorized, executed and delivered by
each of the Company and the Operating Partnership and is a legal, valid and
binding agreement of each of the Company and the Operating Partnership,
enforceable in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally, and by general principles of equity, and except to
the extent that the indemnification and contribution provisions of Section 9
hereof may be limited by U.S. federal or state securities laws and public policy
considerations in respect thereof;
(j) the execution and delivery of the Formation Agreements and each of
the documents, agreements and instruments executed and delivered in connection
therewith, and the consummation of the transactions contemplated by the
foregoing, has been duly authorized by all necessary corporate or other action
by the Company, the Operating Partnership and the other parties to the Formation
Agreements, including, but not limited to, any vote of the stockholders or other
holders of equity interests which may be required by the applicable
organizational document, or applicable state law, and the Formation Agreements
are sufficient to effect the valid transfer to the Operating Partnership of all
real property and other assets specified in the Formation Agreements, upon
payment of the consideration therefor;
(k) the Formation Agreements to which the Company, the Operating
Partnership or any other Subsidiary is a party have been duly authorized,
executed and delivered by the Company, the Operating Partnership and each other
Subsidiary (to the extent a party thereto) and are legal, valid and binding
agreements of the Company, the Operating Partnership [and each other Subsidiary
(to the extent a party thereto),] enforceable in accordance with their
respective terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights
generally, and by general equitable principles;
(l) no approval, authorization, consent or order of or filing with any
U.S. federal, state, local or foreign governmental or regulatory commission,
board, body, authority or agency having jurisdiction over the Company (each, a
"Governmental Authority") is required in connection with the execution, delivery
and performance of this Agreement or the Formation Agreements, the consummation
of the transactions contemplated herein or therein by the Company or the
Operating Partnership (to the extent a party thereto), and the Company's sale
and delivery of the Shares as contemplated hereby other than (A) such as have
been obtained, or will have been obtained at or prior to the Closing Time or the
relevant Date of Delivery, as the case may be, under the Securities Act and the
Securities Exchange Act of 1934 (the "Exchange Act"), (B) such approvals as have
been obtained in connection with the approval of the listing of the Shares on
the New York Stock Exchange and (C) any necessary qualification under the
securities or "blue sky" laws of the various jurisdictions in which the Shares
are being offered by the Underwriters;
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(m) each of the Company and the Subsidiaries has, and will have upon
consummation of the Formation Transactions, all necessary licenses,
authorizations, consents and approvals and has made all necessary filings
required under any U.S. federal, state, local or foreign law, regulation or rule
(except that neither the Company not any Subsidiary organized under the laws of
any state other than the State of Arizona has received a confirmation of from
the State of Arizona as to its foreign qualification status), and has obtained
all necessary authorizations, consents and approvals from other persons,
required in order to conduct its business as described in the Prospectus, except
to the extent that any failure to have any such licenses, authorizations,
consents or approvals, to make any such filings or to obtain any such
authorizations, consents or approvals would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect; neither the
Company nor any Subsidiary is in violation of, in default under, or has received
any notice regarding a possible violation, default or revocation of any such
license, authorization, consent or approval or any U.S. federal, state, local or
foreign law, regulation or rule or any decree, order or judgment applicable to
the Company or any Subsidiary, which would reasonably be expected to have a
Material Adverse Effect; and no such license, authorization, consent or approval
contains a materially burdensome restriction which would, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect that is not
adequately disclosed in the Registration Statement and the Prospectus;
(n) each of the Registration Statement, the Registration Statement on
Form 8-A filed with the Commission by the Company (the "Form 8-A") and any Rule
462(b) Registration Statement has become effective under the Securities Act and
no stop order suspending the effectiveness of the Registration Statement, any
Rule 462(b) Registration Statement or the Form 8-A has been issued under the
Securities Act and no proceedings for that purpose have been instituted or are
pending or, to the knowledge of the Company, are threatened by the Commission,
and the Company has complied to the Commission's satisfaction with any request
on the part of the Commission for additional information;
(o) the Preliminary Prospectus, the Registration Statement and the Form
8-A comply, and the Prospectus and any further amendments or supplements thereto
will, when they have become effective or are filed with the Commission, as the
case may be, comply, in all material respects with the requirements of the
Securities Act and the Securities Act Regulations; the Registration Statement
and the Form 8-A did not, and any amendment thereto will not, in each case as of
the applicable effective date, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading; and the Preliminary Prospectus does not,
and the Prospectus or any amendment or supplement thereto will not, as of its
respective filing date and at the Closing Time and on each Date of Delivery (if
any), contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
provided, however, that the Company makes no warranty or representation with
respect to any statement contained in the Registration Statement or the
Prospectus in reliance upon and in conformity with information concerning the
Underwriters and furnished in writing by or on behalf of the Underwriters
through the Representative to the Company expressly for use in the Registration
Statement or the Prospectus (that information being limited to that described in
the penultimate sentence of the first paragraph of Section 9(c) hereof);
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(p) the Preliminary Prospectus was, and the Prospectus delivered to the
Underwriters for use in connection with this offering will be identical to the
versions of the Preliminary Prospectus and Prospectus, respectively, created to
be transmitted to the Commission for filing via the Electronic Data Gathering
Analysis and Retrieval System ("XXXXX"), except to the extent permitted by
Regulation S-T;
(q) there are no actions, suits, proceedings, inquiries or
investigations pending or, to the knowledge of the Company, threatened against
the Company or any Subsidiary (other than Xxxxxxx Xxxxxx Xxxxx Harrisburg, LP)
or any of their respective officers and directors or to which the properties,
assets or rights of any such entity (including any properties, assets or rights
to be acquired upon consummation of the Formation Transactions) are subject, at
law or in equity, before or by any Governmental Authority or arbitral panel
which would reasonably be expected to result in a judgment, decree, award or
order having a Material Adverse Effect;
(r) there are no actions, suits, proceedings, inquiries or
investigations pending or, to the knowledge of the Company, threatened against
Xxxxxxx Xxxxxx Xxxxx Harrisburg, LP or any of its respective officers and
directors or to which the properties, assets or rights of any such entity
(including any properties, assets or rights to be acquired upon consummation of
the Formation Transactions) are subject, except for actions solely relating to
or affecting the partnership interests held by the limited partners of Xxxxxxx
Xxxxxx Xxxxx Harrisburg, LP (other than Xxxxxxx Harrisburg Limited Partnership
LP), at law or in equity, before or by any Governmental Authority or arbitral
panel which would reasonably be expected to result in a judgment, decree, award
or order having a Material Adverse Effect;
(s) the financial statements, including the notes thereto, included in
the Registration Statement and the Prospectus present fairly the consolidated
financial position of the entities to which such financial statements relate
(the "Covered Entities") as of the dates indicated and the consolidated results
of operations and changes in financial position and cash flows of the Covered
Entities for the periods specified; such financial statements have been prepared
in conformity with generally accepted accounting principles as applied in the
United States and on a consistent basis during the periods involved and in
accordance with Regulation S-X promulgated by the Commission; the financial
statement schedules included in the Registration Statement and the amounts in
the Prospectus under the captions "Summary Financial Data" and "Selected
Financial Data" fairly present the information shown therein and have been
compiled on a basis consistent with the financial statements included in the
Registration Statement and the Prospectus; no other financial statements or
supporting schedules are required to be included in the Registration Statement;
the unaudited pro forma financial information (including the related notes)
included in the Prospectus and any Preliminary Prospectus complies as to form in
all material respects with the applicable accounting requirements of the
Securities Act and the Securities Act Regulations, and management of the Company
believes that the assumptions underlying the pro forma adjustments are
reasonable; such pro forma adjustments have been properly applied to the
historical amounts in the compilation of the information and such information
fairly presents the financial position, results of operations and other
information purported to be shown therein at the respective dates and for the
respective periods specified; no other pro forma financial information is
required to be included in the Registration Statement;
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(t) KPMG LLP, whose reports on the consolidated financial statements of
the Company and the Subsidiaries are filed with the Commission as part of the
Registration Statement and Prospectus is and was during the periods covered by
its reports, independent registered public accountants as required by the
Securities Act and the Securities Act Regulations;
(u) subsequent to the respective dates as of which information is given
in the Registration Statement and the Prospectus, and except as may be otherwise
stated in the Registration Statement or Prospectus, there has not been (A) any
development or transaction that would reasonably be expected to result in a
Material Adverse Effect, whether or not arising in the ordinary course of
business, (B) any obligation, contingent or otherwise, directly or indirectly
incurred by the Company or any Subsidiary that would reasonably be expected to
result in a Material Adverse Effect ,(C) any transaction that is material to the
Company and the Subsidiaries, taken as a whole, contemplated or entered into by
the Company or any of the Subsidiaries, or (D) any dividend or distribution of
any kind declared, paid or made by the Company on any class of its capital stock
or any Subsidiary on any of its equity interests;
(v) the Shares and the OP Units conform in all material respects to the
descriptions thereof contained in the Registration Statement and the Prospectus;
(w) except as disclosed in the Prospectus, there are no persons with
registration or other similar rights to have any equity or debt securities,
including securities which are convertible into, exchangeable or redeemable for
equity securities, registered pursuant to the Registration Statement or
otherwise registered by the Company under the Securities Act;
(x) the issuance of the Shares has been duly authorized and, when
issued and duly delivered against payment therefor as contemplated by this
Agreement, the Shares will be validly issued, fully paid and nonassessable, free
and clear of any pledge, lien, encumbrance, security interest or other claim,
and the issuance and sale of the Shares by the Company is not subject to
preemptive or other similar rights arising by operation of law, under the
organizational documents of the Company or any Subsidiary or under any agreement
to which the Company or any Subsidiary is a party or otherwise;
(y) the Shares have been approved for listing on the New York Stock
Exchange, subject to official notice of issuance;
(z) the Company has not taken, and will not take, directly or
indirectly, any action which is designed to or which has constituted or which
might reasonably be expected to cause or result in stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of
the Shares;
(aa) neither the Company nor any of its affiliates (i) is required to
register as a "broker" or "dealer" in accordance with the provisions of the
Exchange Act, or the rules and regulations thereunder (the "Exchange Act
Regulations"), or (ii) directly, or indirectly through one or more
intermediaries, controls or has any other association with (within the meaning
of Article I of the By-laws of the National Association of Securities Dealers,
Inc. (the "NASD")) any member firm of the NASD;
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(bb) any certificate signed by any officer of the Company or any
Subsidiary delivered to counsel for the Representative or to counsel for the
Underwriters pursuant to or in connection with this Agreement shall be deemed a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby;
(cc) the form of certificate used to represent the Common Stock
complies in all material respects with all applicable statutory requirements,
with the charter of the Company and the requirements of the New York Stock
Exchange;
(dd) upon consummation of the Formation Transactions, the Operating
Partnership or the Subsidiaries will have good and marketable title in fee
simple to, or a valid leasehold interest in, all real property described in the
Prospectus, and good title to all personal property owned (or to be owned upon
consummation of the Formation Transactions) by them, in each case free and clear
of all liens, security interests, pledges, charges, encumbrances, encroachments,
restrictions, mortgages and defects, except such as are disclosed in the
Prospectus or are not material and do not interfere with the use made or
proposed to be made of such property by the Operating Partnership or the
Subsidiaries; any real property, buildings, improvements, equipment and personal
property held under lease (or to be held under lease upon consummation of the
Formation Transactions) by the Operating Partnership or any Subsidiary are held
(or will be held upon consummation of the Formation Transactions) under valid,
existing and enforceable leases, with such exceptions as are disclosed in the
Prospectus or are not material and do not interfere with the use made or
proposed to be made of such property, buildings, improvements, equipment and
personal property by the Operating Partnership or the Subsidiaries; the
Operating Partnership or the Subsidiaries have obtained (or will have obtained
upon consummation of the Formation Transactions) an owner's or leasehold title
insurance policy from a title insurance company licensed to issue such policy,
on any real property owned in fee or leased (or to be so owned or leased upon
the consummation of the Formation Transactions), as the case may be, by the
Operating Partnership or the Subsidiaries that insures their fee or leasehold
interest, as the case may be, in such real property, which policies include only
commercially reasonable exceptions, and with coverages in amounts at least equal
to amounts that are generally deemed in the Operating Partnership's industry to
be commercially reasonable in the markets where their properties are located, or
a lender's title insurance policy insuring the lien of its mortgage securing the
real property with coverage equal to the maximum aggregate principal amount of
any indebtedness secured by the real property;
(ee) to the Company's knowledge, all real property owned or leased by
the Company or a Subsidiary (or to be owned or leased upon consummation of the
Formation Transactions) is free of material structural defects and all building
systems contained therein are in good working order in all material respects,
subject to ordinary wear and tear or, in each instance, the Company or a
Subsidiary, as the case may be, has created an adequate reserve to effect
reasonably required repairs, maintenance and capital expenditures; to the
knowledge of the Company and such Subsidiary, water, storm water, sanitary
sewer, electricity and telephone service are all available at the property lines
of such property over duly dedicated streets or perpetual easements of record
benefiting such property; except as described in the Prospectus, to the
knowledge of the Company and such Subsidiary, there is no pending or threatened
special assessment, tax reduction proceeding or other action that could increase
the real property taxes or assessments of any of such property, that, would
reasonably be expected to have a Material Adverse Effect;
10
(ff) the mortgages and deeds of trust encumbering, or upon consummation
of the Formation Transactions to be encumbering, any real property owned in fee
or leased by the Operating Partnership or a Subsidiary (or to be owned or leased
upon consummation of the Formation Transactions) (i) are not convertible (in the
absence of foreclosure) into an equity interest in such real property or in the
Company, the Operating Partnership or any Subsidiary, and none of the Company,
the Operating Partnership or any other Subsidiary holds a participating interest
therein, (ii) except as set forth in the Prospectus, are not and will not be
cross-defaulted to any indebtedness other than indebtedness of the Company, the
Operating Partnership or any of the other Subsidiaries and (iii) are not and
will not be cross-collateralized to any property not owned by the Company, the
Operating Partnership or any of the other Subsidiaries;
(gg) the descriptions in the Registration Statement and the Prospectus
of the legal or governmental proceedings, contracts, leases and other legal
documents therein described present fairly the information required to be shown,
and there are no legal or governmental proceedings, contracts, leases or other
documents of a character required to be described in the Registration Statement
or the Prospectus or to be filed as exhibits to the Registration Statement which
are not described or filed as required; all agreements between the Company or
any of the Subsidiaries and third parties expressly referenced in the Prospectus
are, and will be upon consummation of the Formation Transaction, legal, valid
and binding obligations of the Company or one or more of the Subsidiaries, and
to the knowledge of the Company and such Subsidiaries, with respect to third
parties, enforceable in accordance with their respective terms, except to the
extent enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights generally and by general
equitable principles and no party is, or will be upon consummation of the
Formation Transactions, in breach or default under any such Agreement;
(hh) the Company and the Subsidiaries own or possess (or upon
completion of the Formation Transactions will own or possess) adequate licenses
or other rights to use all patents, trademarks, service marks, trade names,
copyrights, software and design licenses, trade secrets, manufacturing
processes, other intangible property rights and know-how (collectively
"Intangibles") necessary to entitle the Company and each Subsidiary to conduct
its business as described in the Prospectus, and neither the Company nor any
Subsidiary has received notice of infringement of or conflict with (and the
Company and the Subsidiaries know of no such infringement of or conflict with)
asserted rights of others with respect to any Intangibles which would reasonably
be expected to have a Material Adverse Effect;
(ii) each of the Company and the Subsidiaries will maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles as applied in the United States and to maintain asset
accountability; (iii) access to assets is permitted only in accordance with
management's general or specific authorization and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences;
11
(jj) the Company and the Subsidiaries maintain, or upon completion of
the offering of the Shares will maintain, insurance (issued by insurers of
recognized financial responsibility) of the types and in the amounts generally
deemed adequate for their respective businesses and consistent with insurance
coverage maintained by similar companies in similar businesses, including, but
not limited to, directors and officers liability insurance and insurance
covering real and personal property owned or leased by the Company and the
Subsidiaries against theft, damage, destruction, acts of vandalism and all other
risks customarily insured against;
(kk) each of the Company and the Subsidiaries has filed on a timely
basis all necessary U.S. federal, state, local and foreign income and franchise
tax returns required to be filed through the date hereof and has paid all taxes
shown as due thereon and, if due and payable, any related or similar assessment,
fine or penalty levied against the Company or any of the Subsidiaries; and no
tax deficiency has been asserted against any such entity, nor does any such
entity know of any tax deficiency which is likely to be asserted against any
such entity which, if determined adversely to any such entity, would reasonably
be expected to have a Material Adverse Effect; and all tax liabilities are
adequately provided for on the respective books of such entities;
(ll) except as described in the Prospectus, neither the Company nor any
of the Subsidiaries is in violation, or has received notice of any violation
with respect to, any applicable environmental, safety or similar law applicable
to the business or properties owned by the Company or any of the Subsidiaries;
the Company and the Subsidiaries have received, and will have upon consummation
of the offering of the Shares, all permits, licenses or other approvals required
of them under applicable federal and state occupational safety and health and
environmental laws, regulations and rules to conduct their respective
businesses, and the Company, the Subsidiaries and FLA are in compliance with all
terms and conditions of any such permit, license or approval, except any such
violation of law regulation or rule, failure to receive required permits,
licenses or other approvals or failure to comply with the terms and conditions
of such permits, licenses or approvals which would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect;
(mm) neither the Company nor any Subsidiary is in violation of or has
received notice of any violation with respect to any U.S. federal or state law
relating to discrimination in the hiring, promotion or pay of employees, nor any
applicable U.S. federal or state wages and hours law, the violation of any of
which, individually or in the aggregate, would reasonably be expected to have a
Material Adverse Effect;
(nn) each of the Company and the Subsidiaries is in compliance in all
material respects with all presently applicable provisions of the Employee
Retirement Income Security Act of 1974, as amended, including the regulations
and published interpretations thereunder ("ERISA"); no "reportable event" (as
defined in ERISA) has occurred with respect to any "pension plan" (as defined in
ERISA) for which the Company or any of the Subsidiaries would have any
liability; each of the Company and the Subsidiaries has not incurred and does
not expect to incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (ii) Section 412 or
4971 of the Internal Revenue Code of 1986, as amended, including the regulations
and published interpretations thereunder (the "Code"); and each "pension plan"
for which each of the Company and the Subsidiaries would have any liability that
is intended to be qualified under Section 401(a) of the Code will be so
qualified in all material respects and nothing has occurred, whether by action
or by failure to act, which would prevent such qualification;
12
(oo) neither the Company nor any of the Subsidiaries nor any officer or
director purporting to act on behalf of the Company or any of the Subsidiaries
has at any time (i) made any contributions to any candidate for political
office, or failed to disclose fully any such contributions, in violation of law,
(ii) made any payment to any U.S. federal, state, local or foreign governmental
officer or official, or other person charged with similar public or quasi-public
duties, other than payments required or allowed by applicable law and the
Company's Code of Ethics, (iii) made any payment outside the ordinary course of
business to any investment officer or loan broker or person charged with similar
duties of any entity to which the Company or any of the Subsidiaries sells or
from which the Company or any of the Subsidiaries buys loans or servicing
arrangements for the purpose of influencing such agent, officer, broker or
person to buy loans or servicing arrangements from or sell loans to the Company
or any of the Subsidiaries or (iv) engaged in any transactions, maintained any
bank account or used any corporate funds except for transactions, bank accounts
and funds which have been and are reflected in the normally maintained books and
records of the Company and the Subsidiaries;
(pp) except as described in the Prospectus, there are no material
outstanding loans or advances or material guarantees of indebtedness by the
Company or any of the Subsidiaries to or for the benefit of any of the officers
or directors of the Company or any of the Subsidiaries or any of the members of
the families of any of them;
(qq) neither the Company nor any of the Subsidiaries nor, to the
knowledge of the Company, any employee or agent of the Company or any of the
Subsidiaries, has made any payment of funds of the Company or of any Subsidiary
or received or retained any funds in violation of any law, rule or regulation or
of a character required to be disclosed in the Prospectus;
(rr) all securities other than the Shares issued by the Company, any of
the Subsidiaries or any trusts established by the Company or any Subsidiary on
or prior to the date hereof, have been issued and sold in compliance with (i)
all applicable U.S. federal and state securities laws, (ii) the laws of the
applicable jurisdiction of organization of the issuing entity and (iii) to the
extent applicable to the issuing entity, the requirements of the New York Stock
Exchange and the issuance and sale of the shares of Common Stock, OP Units and
other equity interests to be issued in the Formation Transactions will be exempt
from registration or qualification under the Securities Act and state securities
laws;
13
(ss) (A) each of the Harrisburg Mall and the Foothills Mall (each a
"Property" and, collectively, the "Properties") complies with all applicable
zoning laws, ordinances, regulations and deed restrictions or other covenants in
all material respects and, if and to the extent there is a failure to comply,
such failure does not materially impair the value of any of the Properties and
will not result in a forfeiture or reversion of title; (B) neither the Company
nor any Subsidiary has received from any governmental authority any written
notice of any condemnation of or zoning change affecting the Properties or any
part or knows of any such condemnation or zoning change which is threatened and
which, individually or in the aggregate, if consummated would reasonably be
expected to have a Material Adverse Effect; (C) all liens, charges,
encumbrances, claims, or restrictions on or affecting the properties and assets
(including the Properties and any other assets to be acquired pursuant to the
Formation Transactions) of the Company, the Operating Partnership or any of the
other Subsidiaries that are required to be described in the Prospectus (or the
most recent Preliminary Prospectus) are disclosed therein; (D) no lessee of any
portion of any of the Properties is in default under any of the leases governing
such properties and there is no event which, but for the passage of time or the
giving of notice or both, would constitute a default under any of such leases,
except such defaults that, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect; and (E) no tenant
under any lease pursuant to which any of the Properties is leased has an option
or right of first refusal to purchase the premises leased thereunder or the
building of which such premises are a part, except as such options or rights of
first refusal which, if exercised, would not reasonably be expected to have a
Material Adverse Effect, and except as provided by law;
(tt) the Company has obtained a Phase I Environmental Audit with
respect to each Property and, except as otherwise disclosed in the Prospectus or
in the Phase I Environmental Audits previously delivered to the Underwriters or
their counsel (the "Audits"), (i) neither the Company nor any Subsidiary nor, to
the knowledge of the Company, any other owners of the Property at any time or
any other party has at any time, handled, stored, treated, transported,
manufactured, spilled, leaked, or discharged, dumped, transferred or otherwise
disposed of or dealt with, Hazardous Materials (as hereinafter defined) on, to
or from any Property, other than by any such action taken in material compliance
with all applicable Environmental Statutes (as hereinafter defined) or by the
Company, any of the Subsidiaries or any other party in connection with the
ordinary use of residential, retail or commercial properties owned by the
Company or any Subsidiary; (ii) the Company and the Subsidiaries do not intend
to use any Property or any subsequently acquired properties for the purpose of
handling, storing, treating, transporting, manufacturing, spilling, leaking,
discharging, dumping, transferring or otherwise disposing of or dealing with
Hazardous Materials other than by any such action taken in compliance with all
applicable Environmental Statues or by the Company, any of the Subsidiaries or
any other party in connection with the ordinary use of residential, retail or
commercial properties owned by the Company or any Subsidiary; (iii) the Company
does not know of any seepage, leak, discharge, release, emission, spill, or
dumping of Hazardous Materials into waters on or adjacent to any Property or any
other real property owned or occupied by any such party, or onto lands from
which Hazardous Materials might seep, flow or drain into such waters; (iv) the
Company has not received any notice of, and or has no knowledge of, any
occurrence or circumstance which, with notice or passage of time or both, would
give rise to a claim under or pursuant to any U.S. federal, state or local
environmental statute or regulation or under common law, pertaining to Hazardous
Materials on or originating from any of any Property or arising out of the
conduct of any such party, including without limitation a claim under or
pursuant to any Environmental Statute (hereinafter defined); and (v) no Property
is included or, to the Company's knowledge, is proposed for inclusion on the
National Priorities List issued pursuant to CERCLA (as hereinafter defined) by
the United States Environmental Protection Agency (the "EPA") or, to the
Company's knowledge, proposed for inclusion on any similar list or inventory
issued pursuant to any other Environmental Statute or issued by any other
Governmental Authority;
14
As used herein, "Hazardous Material" shall include, without limitation,
any flammable explosives, radioactive materials, hazardous materials, hazardous
wastes, toxic substances, or related materials, asbestos or any hazardous
material as defined by any U.S. federal, state or local environmental law,
ordinance, rule or regulation including without limitation the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended, 42
U.S.C. Sections 9601-9675 ("CERCLA"), the Hazardous Materials Transportation
Act, as amended, 49 U.S.C. Sections 1801-1819, the Resource Conservation and
Recovery Act, as amended, 42 U.S.C. Sections 6901-6992K, the Emergency Planning
and Community Right-to-Know Act of 1986, 42 U.S.C. Sections 11001-11050, the
Toxic Substances Control Act, 15 U.S.C. Sections 2601-2671, the Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. Sections 136-136y, the
Clean Air Act, 42 U.S.C. Sections 7401-7642, the Clean Water Act (Federal Water
Pollution Control Act), 33 U.S.C. Sections 1251-1387, the Safe Drinking Water
Act, 42 U.S.C. Sections 300f-300j-26, and the Occupational Safety and Health
Act, 29 U.S.C. Sections 651-678, as any of the above statutes may be amended
from time to time, and in the regulations promulgated pursuant to each of the
foregoing (individually, an "Environmental Statute") or by any Governmental
Authority;
(uu) except as disclosed in the Prospectus, there are no costs or
liabilities associated with the Properties pursuant to any Environmental Statute
(including, without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with any Environmental Statute
or any permit, license or approval, any related constraints on operating
activities and any potential liabilities to third parties) that, individually or
in the aggregate, would reasonably be expected to have a Material Adverse
Effect;
(vv) none of the entities that prepared Phase I Environmental Audits or
other environmental assessments with respect to the Properties was employed for
such purpose on a contingent basis or has any substantial interest in the
Company or any of the Subsidiaries, and none of the directors, officers or
employees is connected with the Company or any of the Subsidiaries as a
promoter, selling agent, trustee, officer, director or employee; (ww) in
connection with the offer and sale of the Shares the Company has not (i) offered
and will not offer its Common Stock or any other securities convertible into or
exchangeable or exercisable for Common Stock in a manner in violation of the
Securities Act or (ii) distributed and will not distribute any Prospectus or
other offering material, other than the Preliminary Prospectus and the
Prospectus;
(xx) except as disclosed in the Prospectus, the Company has not
incurred any liability for any finder's fees or similar payments in connection
with the transactions herein contemplated;
(yy) except as disclosed in the Prospectus, no relationship, direct or
indirect, exists between or among the Company or any of the Subsidiaries on the
one hand, and the directors, officers, stockholders, customers or suppliers of
the Company or any of the Subsidiaries on the other hand, which is required by
the Securities Act and the Securities Act Regulations to be described in the
Registration Statement and the Prospectus and which is not so described;
(zz) neither the Company nor any of the Subsidiaries is or, after
giving effect to the offering and sale of the Shares, will be, an "investment
company" or an entity "controlled" by an "investment company," as such terms are
defined in the Investment Company Act of 1940, as amended (the "Investment
Company Act");
15
(aaa) there are no existing or, to the knowledge of the Company,
threatened labor disputes with the employees of the Company or any of the
Subsidiaries which would, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect;
(bbb) the statistical and market related data included in the
Preliminary Prospectus, the Prospectus and the Registration Statement are based
on or derived from sources that the Company believes to be reliable and
accurate;
(ccc) except pursuant to that certain amendment dated December __,
2004, the Purchase and Sale Agreement, dated as of September 29, 2004, by and
between BRE/Colonie Center L.L.C. and the Operating Partnership, filed as
Exhibit 10.20 to the Registration Statement, has not been amended or
supplemented and remains in full force in effect as a legal and binding
agreement of the parties thereto, enforceable in accordance with its terms
except as may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting creditors' rights generally, and by general principles
of equity;
(ddd) the Company will properly and timely elect to be taxed as a real
estate investment trust (a "REIT") under the Code commencing with the taxable
year ending December 31, 2004 and the Company will be organized and operated in
conformity with the requirements for qualification as a REIT under the Code and
the proposed method of operation of the Company and the Subsidiaries will enable
the Company to meet the requirements for taxation as a REIT under the Code; and
the Operating Partnership is treated as a partnership for U.S. federal income
tax purposes and not as a corporation or association taxable as a corporation;
the Company intends to continue to qualify as a REIT under the Code for all
subsequent years, and the Company does not know of any event that would cause
the Company to fail to qualify as a REIT under the Code at any time.
4. Certain Covenants:
The Company and the Operating Partnership hereby, jointly and
severally, agree with each Underwriter:
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the securities or
"blue sky" laws of such jurisdictions (both domestic and foreign) as the
Representative may designate and to maintain such qualifications in effect as
long as requested by the Representative for the distribution of the Shares,
provided that neither the Company nor any of the Subsidiaries shall be required
to qualify as a foreign corporation or other entity or to consent to the service
of process under the laws of any such state (except service of process with
respect to the offering and sale of the Shares);
(b) 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 the Representative promptly and, if requested by the
Representative, will confirm such advice in writing, when such post-effective
amendment has become effective;
16
(c) to prepare the Prospectus and file such Prospectus, after review by
the Representative, with the Commission pursuant to Rule 424(b) under the
Securities Act within the time period set forth in Rule 424(b) and to furnish
promptly (and with respect to the initial delivery of such Prospectus, not later
than the second business day following the execution and delivery of this
Agreement or on such other day as the parties may mutually agree) to the
Underwriters copies of the Prospectus (or of the Prospectus as amended or
supplemented if the Company shall have made any amendments or supplements
thereto after the effective date of the Registration Statement) in such
quantities and at such locations as the Underwriters may reasonably request for
the purposes contemplated by the Securities Act Regulations, which Prospectus
and any amendments or supplements thereto furnished to the Underwriters will be
identical to the version created to be transmitted to the Commission for filing
via XXXXX, except to the extent permitted by Regulation S-T;
(d) to advise the Representative immediately, confirming such advice in
writing, of (i) the receipt of any comments from, or any request by, the
Commission for amendments or supplements to the Registration Statement or
Prospectus or for additional information with respect thereto, or (ii) the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of the
Registration Statement, or of the suspension of the qualification of the Shares
for offering or sale in any jurisdiction, or of the initiation or threatening of
any proceedings for any of such purposes and, if the Commission or any
Governmental Authority should issue any such order, to make every reasonable
effort to obtain the lifting or removal of such order as soon as possible and to
advise the Representative promptly of the lifting or removal of such order; to
advise the Representative promptly of any proposal to amend or supplement the
Registration Statement or Prospectus and, unless required by law, to file no
such amendment or supplement to which the Representative shall reasonably object
in writing;
(e) to furnish to the Representative for a period of one year from the
date of this Agreement (i) as soon as practicable, copies of all annual,
quarterly and current reports or other communications supplied to holders of
shares of Common Stock, (ii) as soon as practicable after the filing thereof,
copies of all reports filed by the Company with the NASD or copies of any
material reports filed by the Company with any securities exchange, and (iii)
such other publicly available information as the Representative may reasonably
request regarding the Company and the Subsidiaries;
(f) to advise the Underwriters promptly of the happening of any event
known to the Company within the time during which a Prospectus relating to the
Shares is required to be delivered under the Securities Act Regulations which,
in the judgment of the Company, would require the making of any change in the
Prospectus then being used so that the Prospectus would not include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is necessary
at any time to amend or supplement the Prospectus to comply with any law and,
during such time, to promptly prepare and furnish to the Underwriters copies of
the proposed amendment or supplement before filing any such amendment or
supplement with the Commission and thereafter promptly furnish at the Company's
own expense to the Underwriters and to dealers, copies in such quantities and at
such locations as the Representative may from time to time reasonably request of
an appropriate amendment or supplement to the Prospectus so that the Prospectus
as so amended or supplemented will not, in the light of the circumstances when
it is so delivered, be misleading, or so that the Prospectus will comply with
the Securities Act and the Securities Act Regulations;
17
(g) to file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that (i) may, in the judgment of the Company, be required by the Securities Act
or requested by the Commission or (ii) the failure to file could reasonably be
expected to, in the reasonable judgment of the Representative, subject the
Underwriters to claims or liability under the securities laws of any
jurisdiction;
(h) prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus or any Prospectus
pursuant to Rule 424 under the Securities Act, to furnish a copy thereof to the
Underwriters and counsel for the Underwriters for review and comment;
(i) to furnish promptly to the Representative a copy of the
Registration Statement, as initially filed with the Commission, and of all
amendments or supplements thereto (including all exhibits filed therewith or
incorporated by reference therein) and such number of conformed copies of the
foregoing as the Representative may reasonably request;
(j) to furnish to the Representative, not less than two full business
days before filing with the Commission subsequent to the effective date of the
Prospectus and during the period referred to in subsection (f) above, a copy of
any document proposed to be filed with the Commission pursuant to Section 13, 14
or 15(d) of the Exchange Act and during such period to file all such documents
in the manner and within the time periods required by the Exchange Act and the
Exchange Act Regulations;
(k) to apply the net proceeds of the sale of the Shares in accordance
with the statements under the caption "Use of Proceeds" in the Prospectus;
(l) to make generally available to its security holders as soon as
practicable, but in any event not later than the end of the fiscal quarter first
occurring after the first anniversary of the effective date of the Registration
Statement, an earnings statement complying with the provisions of Section 11(a)
of the Securities Act (in such form, at the option of the Company, as complies
with Rule 158 of the Securities Act Regulations,) covering a period of 12 months
beginning after the effective date of the Registration Statement;
(m) to use its best efforts to maintain the listing of the Shares on
the New York Stock Exchange and to file with the New York Stock Exchange all
documents and notices required by the New York Stock Exchange of companies that
have securities that are listed on the New York Stock Exchange;
(n) to engage and maintain, at its expense, a registrar and transfer
agent for the Shares;
18
(o) to refrain during a period of 180 days from the date of the
Prospectus, without the prior written consent of the Representative, from,
directly or indirectly, (i) offering, selling, contracting to sell, selling any
option or contract to purchase, purchasing any option or contract to sell,
granting any option for the sale of, or otherwise disposing of or transferring
(or entering into any transaction or device which is designed to, or could be
expected to, result in the disposition by any person at any time in the future
of) any shares of Common Stock or any securities convertible into or exercisable
or exchangeable for Common Stock, or filing any registration statement under the
Securities Act with respect to any of the foregoing, or (ii) entering into any
swap or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of the
Common Stock, whether any such swap or transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence shall not apply to (A)
the Shares to be sold hereunder or (B) any shares of Common Stock issued by the
Company pursuant to the Company's stock incentive plans or in connection with
acquisitions of real property or other investments;
(p) not to, and to use its best efforts to cause its officers,
directors and affiliates not to, (i) take, directly or indirectly prior to
termination of the underwriting syndicate contemplated by this Agreement, any
action designed to stabilize or manipulate the price of any security of the
Company, or which may cause or result in, or which might in the future
reasonably be expected to cause or result in, the stabilization or manipulation
of the price of any security of the Company, to facilitate the sale or resale of
any of the Shares, (ii) except as provided herein or in the letter agreement
dated May 28, 2004, between the Company and the Representative (the "Engagement
Letter"), pay anyone any compensation for soliciting purchases of the Shares or
(iii) pay or agree to pay to any person any compensation for soliciting any
order to purchase any other securities of the Company;
(q) to cause each executive, officer and director of the Company to
furnish to the Representative, prior to the first Date of Delivery, a letter
agreement, substantially in the form of Exhibit A hereto, pursuant to which each
such person shall agree not to, directly or indirectly, (1) offer for sale,
sell, pledge or otherwise dispose of (or enter into any transaction or device
which is designed to, or could be expected to, result in the disposition by any
person at any time in the future of) any shares of Common Stock or securities
convertible into or exchangeable for Common Stock or (2) enter into any swap or
other derivatives transaction that transfers to another, in whole or in part,
any of the economic benefits or risks of ownership of such shares of Common
Stock, whether any such transaction described in clause (1) or (2) above is to
be settled by delivery of Common Stock or other securities, in cash or
otherwise, in each case for a period of 180 days from the date of the
Prospectus, without the prior written consent of the Representative on behalf of
the Underwriters;
19
(r) if at any time during the 90-day period after the Registration
Statement becomes effective, any rumor, publication or event relating to or
affecting the Company shall occur as a result of which, in the reasonable
opinion of the Representative, the market price of the Common Stock has been or
is likely to be materially affected (regardless of whether such rumor,
publication or event necessitates a supplement to or amendment of the
Prospectus) and after written notice from the Representative advising the
Company to the effect set forth above, if the Company determines it is in its
best interest to do so, prepare, consult with the Representative concerning the
substance of, and disseminate a press release or other public statement
responding to or commenting on such rumor, publication or event;
(s) that the Company will comply with all of the provisions of any
undertakings in the Registration Statement and will file with the Commission
such reports as may be required pursuant to Rule 463 of the Securities Act
Regulation;
(t) to use their best efforts to ensure that the Company meets the
requirements for qualification as a REIT under the Code, subject to the
fiduciary duties of the Company's Board of Directors.
5. Payment of Expenses:
The Company and the Operating Partnership agree to pay all costs and
expenses incident to the performance of their obligations under this Agreement
whether or not the transactions contemplated hereunder or thereunder are
consummated or this Agreement is terminated, including expenses and fees in
connection with (i) the preparation and filing of the Registration Statement,
each Preliminary Prospectus, the Prospectus, and any amendments or supplements
thereto, and the printing and furnishing of copies of each thereof to the
Underwriters and to dealers (including costs of mailing and shipment), (ii) the
preparation, issuance and delivery of the certificates for the Shares to the
Underwriters, including any stock or other transfer taxes or duties payable upon
the sale of the Shares to the Underwriters (other than transfer taxes on resales
by the Underwriters), (iii) the printing of this Agreement and any dealer
agreements and furnishing of copies of each to the Underwriters and to dealers
(including costs of mailing and shipment), (iv) the qualification of the Shares
for offering and sale under state laws that the Company and the Representative
have mutually agreed are appropriate and the determination of their eligibility
for investment under state law as aforesaid (including the reasonable legal fees
and filing fees and other disbursements of counsel for the Underwriters and the
printing and furnishing of copies of any "blue sky" surveys or legal investment
surveys to the Underwriters and to dealers), (v) filing for review of the public
offering of the Shares by the NASD (including the legal fees and filing fees and
other disbursements of counsel for the Underwriters relating thereto), (vi) the
fees and expenses of any transfer agent or registrar for the Shares and
miscellaneous expenses referred to in the Registration Statement, (vii) the fees
and expenses incurred in connection with the inclusion of the Shares in the New
York Stock Exchange, (viii) making road show presentations with respect to the
offering of the Shares, (ix) preparing and distributing transaction documents
for the Representative and its legal counsel, (x) expenses of the Representative
as provided in Section 4(c) of the Engagement Letter and (xi) the performance of
the Company's and the Operating Partnership's other obligations hereunder. Upon
the request of the Representative, the Company will provide funds in advance for
filing fees.
20
6. Conditions of the Underwriters' Obligations:
(a) The obligations of the Underwriters hereunder to purchase Shares at
the Closing Time or on each Date of Delivery, as applicable, are subject to the
accuracy of the representations and warranties on the part of the Company and
the Operating Partnership hereunder on the date hereof and at the Closing Time
and on each Date of Delivery, as applicable, the performance by the Company and
the Operating Partnership of their respective obligations hereunder and to the
satisfaction of the following further conditions at the Closing Time or on each
Date of Delivery, as applicable:
(b) The Company shall furnish to the Underwriters at the Closing Time
and on each Date of Delivery an opinion of Xxxxxxxx Chance US LLP, counsel for
the Company, addressed to the Underwriters and dated the Closing Time and each
Date of Delivery, and in form and substance satisfactory to King & Spalding LLP,
counsel for the Underwriters, to the effect that:
(i) to such counsel's knowledge, the outstanding shares of
capital stock of or partnership interests, membership interests or
other equity interests, as the case may be, in the significant
Subsidiaries listed on Annex A thereto have been duly and validly
authorized and issued, and all of the outstanding partnership interests
or membership interests, as the case may be, in the Subsidiaries (other
than the Operating Partnership) are owned of record as set forth in an
exhibit to such opinion; except as disclosed in the Prospectus, to such
counsel's knowledge, there are no outstanding (i) securities or
obligations of the Company or any of the Subsidiaries convertible into
or exchangeable for any capital stock, partnership interests,
membership interests or other equity interests, as the case may be, in
the Company or any Subsidiary, or (ii) obligations of the Company or
any such Subsidiary to issue any such securities or obligations;
(ii) each of the significant Subsidiaries is validly existing
as a general or limited partnership or limited liability company, as
the case may be, in good standing under the laws of its jurisdiction of
organization with the partnership or limited liability company power
and authority to own its properties and to conduct its respective
businesses as described in the Prospectus and in the case of the
Operating Partnership, to execute and deliver this Agreement and the
Formation Agreements described on a schedule to the opinion (to the
extent a party thereto) and to consummate the transactions described in
each such agreement;
(iii) each of the Company and the significant Subsidiaries is
duly qualified and is in good standing in each jurisdiction set forth
in an exhibit to such opinion; to such counsel's knowledge, other than
as disclosed in the Prospectus, the Company does not own, directly or
indirectly, any capital stock or other equity securities of any other
corporation or any ownership interest in any partnership, limited
liability company or other entity;
(iv) to such counsel's knowledge, the Company and the
Operating Partnership are in compliance with all laws, orders, rules
and regulations relating to their business as described in the
Prospectus, except for such non-compliance as would not, in the
aggregate, reasonably be expected to have a Material Adverse Effect;
(v) to such counsel's knowledge, neither the Company nor any
of the significant Subsidiaries thereto is in violation of its
organizational documents;
21
(vi) the execution, delivery and performance of this Agreement
and the Formation Agreements described on a schedule to the opinion by
the Company, the Operating Partnership and the significant Subsidiaries
(to the extent a party thereto) and the consummation by the Company,
the Operating Partnership and the significant Subsidiaries (to the
extent a party thereto) of the transactions contemplated by this
Agreement and such Formation Agreements do not and will not (A)
conflict with, or result in any breach of, or constitute a default
under (nor constitute any event which with notice, lapse of time, or
both would constitute a breach of or default under), (i) any provisions
of the organizational documents of the Operating Partnership or the
significant Subsidiaries, (ii) to such counsel's knowledge, any law or
regulation binding upon or applicable to the Company, the Operating
Partnership or the significant Subsidiaries or (iii) to such counsel's
knowledge, any decree, judgment or order applicable to the Company, the
Operating Partnership or the significant Subsidiaries or (B) to such
counsel's knowledge, result in the creation or imposition of any lien,
charge, claim or encumbrance upon any property or assets of the
Company, the Operating Partnership or the significant subsidiaries,
except such conflicts, breaches or defaults that are described in the
Prospectus or would not reasonably be expected to have a Material
Adverse Effect;
(vii) this Agreement has been duly authorized, executed and
delivered by the Company and the Operating Partnership;
(viii) each of the Formation Agreements has been duly
authorized, executed and delivered by the Company (assuming due
authorization thereof), the Operating Partnership and each significant
Subsidiary that is a party thereto. Each Formation Agreement governed
by the laws of the State of New York is a legal, valid and binding
agreement of the Company, the Operating Partnership and each
significant Subsidiary party thereto, enforceable in accordance with
its terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights
generally, and by general principles of equity;
(ix) no approval, authorization, consent or order of or filing
with any Governmental Authority is required in connection with the
execution, delivery and performance of this Agreement, the consummation
of the transactions contemplated herein by the Company and the
Operating Partnership (to the extent a party thereto), and the sale and
delivery of the Shares by the Company as contemplated herein, other
than such as have been obtained or made under the Securities Act and
the Securities Act Regulations and the Exchange Act and Exchange Act
Regulations, and except that such counsel need express no opinion as to
any necessary qualification under the foreign securities, state
securities or "blue sky" laws of the various jurisdictions in which the
Shares are being offered by the Underwriters or with the National
Association of Securities Dealers, Inc.;
(x) the Company is not subject to registration as an
investment company under the Investment Company Act and the offering
and sale of the Shares and the Transactions contemplated by the
Formation Agreements will not cause the Company to become an investment
company subject to registration under the Investment Company Act;
(xi) the issuance of the OP Units described in the Prospectus
has been duly authorized and upon issuance in accordance with the terms
of the Partnership Agreement the OP Units described in the Prospectus
will be validly issued;
22
(xii) except as disclosed in the Prospectus, to such counsel's
knowledge, there are no persons with registration or other similar
rights to have any equity or debt securities, including securities that
are convertible into or exchangeable for equity securities, registered
pursuant to the Registration Statement or otherwise registered by the
Company under the Securities Act;
(xiii) such counsel shall state that (1) it has been advised
that the Registration Statement has become effective under the
Securities Act, (2) it has been advised that no stop order suspending
the effectiveness of the Registration Statement has been issued and (3)
to such counsel's knowledge, no proceedings with respect to any stop
order have been commenced or threatened;
(xiv) as of the effective date of the Registration Statement,
the Registration Statement and the Prospectus (except as to the
financial statements and other financial and statistical data contained
therein or excluded therefrom, as to which such counsel need express no
opinion) complied as to form in all material respects with the
requirements of the Securities Act and the Securities Act Regulations;
(xv) the descriptions of law and legal conclusions under the
captions "Risk Factors -Risks Related to Our Organization and Operation
as a REIT," "U.S. Federal Income Tax Considerations," "Underwriting"
and "Shares Eligible for Future Sale," insofar as such statements
constitute a summary of the legal matters referred to therein,
constitute accurate summaries thereof in all material respects, and the
descriptions or summaries of the material agreements under the captions
"Structure and Formation of our Company" and "Xxxxxxx Equities
Operating Partnership, LP" fairly and accurately set forth the material
provisions of such contracts and documents;
(xvi) the 8-A Registration Statement complied as to form in
all material respects with the requirements of the Exchange Act; the
8-A Registration Statement has become effective under the Exchange Act;
(xvii) to such counsel's knowledge, there are no legal or
governmental proceedings pending to which the Company, the Operating
Partnership or any of the significant Subsidiaries is a party or to
which any property of the Company, the Operating Partnership or any of
the significant Subsidiaries is subject that are required to be
disclosed in the Prospectus pursuant to Item 103 of Regulation S-K of
the Securities Act Regulations that are not so disclosed;
(xviii) to such counsel's knowledge, there are no contracts or
documents of a character required to be filed as exhibits to the
Registration Statement or required to be described or summarized in the
Prospectus which have not been so filed, summarized or described;
(xix) the securities offered and sold in connection with the
Formation Transactions, are exempt from the registration requirements
of the Securities Act and the Securities Act Regulations;
23
(xx) Commencing with its taxable year ending December 31,
2004, the Company is organized in conformity with the requirements for
qualification and taxation as a REIT under the Code, and the Company's
proposed method of operation will enable it to meet the requirements
for qualification and taxation as a REIT under the Code.
In addition, such counsel shall state that they have reviewed the
Registration Statement and participated in the preparation of the Registration
Statement and the Prospectus and in discussions with officers, directors,
employees and other representatives of the Company, representatives of the
independent registered public accountants for the Company, the Underwriters and
their representatives, at which the contents of the Registration Statement and
the Prospectus and related matters were discussed, and they have reviewed
certain corporate, limited liability company, trust and partnership records,
documents and proceedings. On the basis of the foregoing, nothing has come to
their attention that leads them to believe that the Registration Statement
(except for financial statements and supporting schedules and other financial
and statistical data derived from such financial statements included therein or
omitted therefrom, as to which counsel need not express any belief), 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 (except for financial statements and supporting schedules and other
financial data included therein or omitted therefrom, as to which such counsel
need not express any belief), as of its date or the date hereof, included or
includes an untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
In addition, such counsel may state that the limitations inherent in
the independent verification of factual matters and the character of
determinations involved in the preparation of a disclosure document are such,
however, that such counsel does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement or the Prospectus or any amendments to them.
Further, such counsel may state that, with regard to the opinion set
forth in paragraph (xvii) hereof, they have not searched the records or dockets
of any court in any jurisdiction and have relied, in rendering such opinion, on
a certificate executed by the Company.
In rendering such opinions, such counsel may limit its opinions to the
Delaware Revised Uniform Limited Partnership Act and the Delaware Limited
Liability Company Act (which for the purposes of rendering such opinions
includes all applicable case law), the laws of the State of New York and the
federal laws of the United States of America and may rely on opinions of local
counsel as well as certificates of public officials and officers of the Company.
(c) The Company shall furnish to the Underwriters at the Closing Time
and on each Date of Delivery an opinion of Xxxxxxx LLP, special Maryland counsel
for the Company, addressed to the Underwriters and dated the Closing Time and
each Date of Delivery and in form and substance satisfactory to King & Spalding
LLP, counsel for the Underwriters, stating that:
(i) the Company is a corporation duly incorporated 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 and has the corporate power to own its properties
and to conduct its business in all material respects as described in
the Prospectus under the caption "Business and Properties;"
24
(ii) the Company has the corporate power to enter into and
perform this Agreement and the Formation Agreements (to the extent a
party thereto) and to consummate the transactions contemplated herein
or therein; this Agreement and each of the Formation Agreements to
which the Company is a party have been duly executed and, so far as is
known to such counsel, delivered by the Company;
(iii) the issuance of the Shares has been duly authorized and,
when and if issued and delivered against payment therefor in accordance
with this Agreement, the Shares will be validly issued, fully paid and
nonassessable and will be free and clear of any pledge, lien,
encumbrance, security interest or other claim arising under the
Maryland General Corporation Law (the "MGCL") in connection with the
issuance of the Shares;
(iv) the statements under the captions "Prospectus Summary -
Our Ownership Limit," "Risk Factors - Risks Related to Our Organization
and Structure - Our organizational documents, including the stock
ownership limit imposed by our charter, may inhibit market activity in
our stock and could delay, defer or prevent a change in control
transaction," "- Certain provisions of Maryland law could inhibit
changes in control," "- Our board of directors has the power to issue
additional shares of our stock in a manner that may not be in your best
interests," "- Our rights and the rights of our stockholders to take
action against our directors and officers are limited," "Policies with
Respect to Certain Activities - Interested Director and Officer
Transactions," "Description of Stock" and "Certain Provisions of
Maryland Law and of our Charter and Bylaws" in the Prospectus and "Item
34. Indemnification of Directors and Officers" in the Registration
Statement, insofar as such statements purport to constitute summaries
of the Company's charter, the Company's bylaws or Maryland law,
constitute accurate summaries thereof in all material respects;
(v) the Company has an authorized capitalization as set forth
in the Prospectus under the caption "Capitalization" and the
outstanding shares of stock of the Company (other than the Shares) have
been duly authorized and are validly issued, fully paid and
nonassessable;
(vi) the issuance and sale of the Shares by the Company are
not subject to preemptive or other similar rights arising under the
Company's charter or bylaws or the MGCL;
(vii) the Shares conform in all material respects to the
descriptions thereof contained in Prospectus under the caption
"Description of Stock";
(viii) the form of certificate used to represent the Common
Stock complies in all material respects with all applicable statutory
requirements, and with any applicable requirements of the Company's
charter and bylaws; and
25
(ix) the execution and delivery by the Company of this
Agreement and each of the Formation Agreements to which the Company is
a party and the consummation by the Company of the transactions
contemplated hereby and thereby have been duly authorized by the
Company and do not and will not conflict with the Company's charter or
bylaws.
(d) The Company shall furnish to the Underwriters at the Closing Time
and on each Date of Delivery an opinion of [Xxx Xxxxxx, Xxxxxx & Xxxxxxx, LLP],
special Arizona counsel for the Company, addressed to the Underwriters and dated
the Closing Time and each Date of Delivery and in form and substance
satisfactory to King & Spalding LLP, counsel for the Underwriters, stating that:
(i) to such counsel's knowledge, the outstanding shares of
capital stock of or partnership interests, membership interests or
other equity interests, as the case may be, in the Subsidiaries (and
Xxxxxxx Equities of Arizona, LLC, which shall for purposes of this
opinion only be deemed a Subsidiary) organized in the State of Arizona
have been duly and validly authorized and issued and in the case of
equity interests in Subsidiaries organized as corporations, are fully
paid and nonassessable, and all of the outstanding shares of capital
stock of or partnership interests, membership interests or other equity
interests, as the case may be, in these Subsidiaries are owned of
record as set forth in an exhibit to such opinion; except as disclosed
in the Prospectus, to such counsel's knowledge, there are no
outstanding (i) securities or obligations of these Subsidiaries
convertible into or exchangeable for any capital stock, partnership
interests, membership interests or other equity interests, as the case
may be, in any such Subsidiary, or (ii) obligations of any such
Subsidiary to issue any such securities or obligations;
(ii) each such Subsidiary is validly existing as corporation
or a general or limited partnership or limited liability company, as
the case may be, in good standing under the laws of the State of
Arizona with the corporate, partnership or limited liability company
power and authority to own its properties and to conduct its respective
businesses as described in the Prospectus and to execute and deliver
the Formation Agreements described on a schedule to the opinion (to the
extent a party thereto) and to consummate the transactions described in
each such agreement;
(iii) each such Subsidiary (other than Xxxxxxx Equities of
Arizona, LLC) is duly qualified and is in good standing in each
jurisdiction set forth in an exhibit to such opinion to such counsel's
knowledge,
(iv) no such Subsidiary is prohibited or restricted, directly
or indirectly, from paying dividends to, or from making any other
distribution with respect to such Subsidiary's capital stock,
partnership interests, membership interests or other equity interests,
as the case may be, or from repaying to the Company or any other
Subsidiary any amounts which may from time to time become due under any
loans or advances to such Subsidiary from the Company or such other
Subsidiary, or from transferring any such Subsidiary's property or
assets to the Company or to any other Subsidiary;
(v) to such counsel's knowledge, each such Subsidiary is in
compliance with all laws, orders, rules and regulations relating to its
business as described in the Prospectus, except for such non-compliance
as would not, in the aggregate, reasonably be expected to have a
Material Adverse Effect;
26
(vi) to such counsel's knowledge, no such Subsidiary is in
violation of its organizational documents;
(vii) the execution, delivery and performance of the Formation
Agreements described on a schedule to the opinion by each such
Subsidiary (to the extent a party thereto) and the consummation by each
such Subsidiary (to the extent a party thereto) of the transactions
contemplated by such Formation Agreements do not and will not (A)
conflict with, or result in any breach of, or constitute a default
under (nor constitute any event which with notice, lapse of time, or
both would constitute a breach of or default under), (i) any provisions
of the organizational documents of such Subsidiaries, (ii) to such
counsel's knowledge, any law or regulation binding upon or applicable
to such Subsidiaries or (iii) to such counsel's knowledge, any decree,
judgment or order applicable to such Subsidiaries or (B) to such
counsel's knowledge, result in the creation or imposition of any lien,
charge, claim or encumbrance upon any property or assets of such
Subsidiaries, except such conflicts, breaches or defaults that would
not reasonably be expected to have a Material Adverse Effect;
(viii) each of the Formation Agreements has been duly
authorized by each such Subsidiary that is a party thereto. And each
Formation Agreement governed by the laws of the State of Arizona and is
a legal, valid and binding agreement of such parties, enforceable in
accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally, and by general principles of equity;
(e) The Company shall furnish to the Underwriters at the Closing Time
and on each Date of Delivery an opinion of [____________], special Pennsylvania
counsel for the Company, addressed to the Underwriters and dated the Closing
Time and each Date of Delivery and in form and substance satisfactory to King &
Spalding LLP, counsel for the Underwriters, stating that:
(i) Each of Xxxxxxx Equities General Partner, Inc. ("FEGP"),
Xxxxxxx Equities General Partner Merger, Inc. ("FEGPM"), Xxxxxxx
Harrisburg General Partner, Inc. ("FHGP") and Xxxxxxx Harrisburg
General Partner Merger, Inc. ("FHGPM") is a corporation validly
existing under the laws of the Commonwealth of Pennsylvania;
(ii) The execution and delivery of the Merger Agreement, dated
as of August 13, 2004, by and among FEGP, FEGPM, the Company and
Xxxxxxx Partners, LLC ("the FEGP Merger Agreement"), and the
performance by each of FEGP and FEGPM of its respective obligations
under the FEGP Merger Agreement and the consummation of the merger
contemplated by the FEGP Merger Agreement (the "FEGP Merger") have been
duly and validly authorized by all necessary corporate action on the
part of FEGP and FEGPM;
27
(iii) The execution and delivery of the Merger Agreement,
dated as of August 13, 2004, by and among FHGP, FHGPM, the Company and
Xxxxxxx Partners, LLC ("the FEGP Merger Agreement"), and the
performance by each of FHGP and FHGPM of its respective obligations
under the FHGP Merger Agreement and the consummation of the merger
contemplated by the FHGP Merger Agreement (the "FHGP Merger") have been
duly and validly authorized by all necessary corporate action on the
part of FHGP and FHGPM;
(iv) Each of FEGP, FEGPM, FHGP and FHGMP has all requisite
corporate power and authority to execute and deliver the FEGP Merger
Agreement or the FHGP Merger Agreement, as applicable; and
(v) Upon the filing of the respective certificates of merger
with, and the acceptance of filing by, the Secretary of State of the
Commonwealth of Pennsylvania, each of the FEGP Merger and the FHGP
Merger will be effective under the laws of the Commonwealth of
Pennsylvania.
(f) the Representative shall have received from KPMG LLP letters dated,
respectively, as of the date of this Agreement, the Closing Time and each Date
of Delivery, as the case may be, addressed to the Representative, in form and
substance satisfactory to the Underwriters, relating to the financial
statements, including any pro forma financial statements, of the Company and the
Subsidiaries, and such other matters customarily covered by comfort letters
issued in connection with registered public offerings.
(g) The Representative shall have received at the Closing Time and on
each Date of Delivery the favorable opinion of King & Spalding LLP, dated the
Closing Time or such Date of Delivery, addressed to the Representative and in
form and substance satisfactory to the Representative.
(h) No amendment or supplement to the Registration Statement or
Prospectus shall have been filed to which the Underwriters shall have objected
in writing.
(i) Prior to the Closing Time and each Date of Delivery, (i) no stop
order suspending the effectiveness of the Registration Statement or any order
preventing or suspending the use of any Preliminary Prospectus or Prospectus has
been issued, and no proceedings for such purpose shall have been initiated or
threatened, by the Commission, and no suspension of the qualification of the
Shares for offering or sale in any jurisdiction, or the initiation or
threatening of any proceedings for any of such purposes, has occurred; (ii) all
requests for additional information on the part of the Commission shall have
been complied with to the reasonable satisfaction of the Representative; and
(iii) the Registration Statement and the Prospectus shall not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(j) All filings with the Commission required by Rule 424 under the
Securities Act to have been filed by the Closing Time shall have been made
within the applicable time period prescribed for such filing by such Rule.
(k) Between the time of execution of this Agreement and the Closing
Time or the relevant Date of Delivery there shall not have been any event which
has had a Material Adverse Effect which, in the Representative's judgment, makes
it impracticable or inadvisable to proceed with the public offering of the
Shares as contemplated by the Registration Statement.
28
(l) The Shares shall have been approved for listing on the New York
Stock Exchange.
(m) The NASD shall not have raised any objection with respect to the
fairness and reasonableness of the underwriting terms and arrangements.
(n) The Representative shall have received lock-up agreements from each
executive, officer and director of the Company, in the form of Exhibit A
attached hereto, and such lock-up agreements shall be in full force and effect.
(o) At the Closing Time, each of the Formation Agreements shall have
been executed and delivered by the Company, the Operating Partnership and the
Transferors (to the extent a party thereto) and shall be in full force and
effect.
(p) The Company will, at the Closing Time and on each Date of Delivery,
deliver to the Underwriters a certificate of its Chief Executive Officer and
President and Chief Financial Officer, to the effect that:
(i) with respect to the representations and warranties of the
Company and the Operating Partnership in this Agreement qualified by
materiality or Material Adverse Effect, such representations and
warranties are true and correct, as if made on and as of the date
hereof and with respect to the representations and warranties of the
Company and the Operating Partnership in this Agreement that are not
qualified by materiality or Material Adverse Effect, such
representations and warranties are true and correct in all material
respects, as if made on and as of the date hereof, and the Company has
complied with all the agreements and satisfied in all material respects
the conditions on its part to be performed or satisfied at or prior to
the date hereof;
(ii) no stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment thereto has been
issued and no proceedings for that purpose have been instituted or are
pending or, to such officers' knowledge, threatened under the
Securities Act;
(iii) the Registration Statement when it became effective did
not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and, since the effective date of the
Registration Statement, there has occurred no event required to be set
forth in an amendment or supplemented Prospectus which has not been so
set forth and the Prospectus as of its date and the Closing Time did
not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; and, since the date of the Prospectus, there
has occurred no event required to be set forth in an amendment or
supplemented Prospectus which has not been so set forth;
29
(iv) subsequent to the respective dates as of which
information is given in the Registration Statement and Prospectus,
there has not been (a) any event which has had a Material Adverse
Effect, (b) any transaction that is material to the Company and the
Subsidiaries considered as one enterprise, except transactions entered
into in the ordinary course of business, (c) any obligation, direct or
contingent, that is material to the Company and the Subsidiaries
considered as one enterprise, incurred by the Company or the
Subsidiaries, except obligations incurred in the ordinary course of
business, (d) any change in the capital stock or outstanding
indebtedness of the Company or any Subsidiary that is material to the
Company and the Subsidiaries considered as one enterprise, (e) any
dividend or distribution of any kind declared, paid or made on the
capital stock of the Company, or (f) any loss or damage (whether or not
insured) to the property of the Company or any subsidiary which has
been sustained which has had a Material Adverse Effect; and
(v) each of King & Spalding LLP and Xxxxxxxx Chance US LLP is
entitled to rely on the officers' certificate in connection with the
opinions that each firm is rendering pursuant to this Agreement.
7. Termination:
The obligations of the several Underwriters hereunder shall be subject
to termination in the absolute discretion of the Representative, at any time
prior to the Closing Time or any Date of Delivery, (i) if any of the conditions
specified in Section 6 shall not have been fulfilled when and as required by
this Agreement to be fulfilled, or (ii) if there has been since the respective
dates as of which information is given in the Registration Statement, any event
which has had a Material Adverse Effect, or material change in management of the
Company or any Subsidiary, whether or not arising in the ordinary course of
business, or (iii) if there has occurred any outbreak or escalation of
hostilities or other national or international calamity or crisis or change in
economic, political or other conditions the effect of which on the financial
markets of the United States is such as to make it, in the reasonable judgment
of the Representative, impracticable to market the Shares or enforce contracts
for the sale of the Shares, or (iv) if trading in any securities of the Company
has been suspended by the Commission or by the New York Stock Exchange, or if
trading generally on the New York Stock Exchange has been suspended (including
an automatic halt in trading pursuant to market-decline triggers, other than
those in which solely program trading is temporarily halted), or limitations on
prices for trading (other than limitations on hours or numbers of days of
trading) have been fixed, or maximum ranges for prices for securities have been
required, by such exchange or by order of the Commission or any other
Governmental Authority, or (v) any U.S. federal, state, local or foreign
statute, regulation, rule or order of any court or Governmental Authority has
been enacted, published, decreed or otherwise promulgated which, in the
reasonable opinion of the Representative, materially adversely affects or will
materially adversely affect the business or operations of the Company or (vi)
any action has been taken by any Governmental Authority or agency in respect of
its monetary or fiscal affairs which, in the reasonable opinion of the
Representative, has a material adverse effect on the securities markets in the
United States.
30
If the Representative elects to terminate this Agreement as provided in
this Section 7, the Company, the Operating Partnership and the Underwriters
shall be notified promptly by telephone, promptly confirmed by facsimile.
If the sale to the Underwriters of the Shares, as contemplated by this
Agreement, is not carried out by the Underwriters for any reason permitted under
this Agreement or if such sale is not carried out because the Company shall be
unable to comply in all material respects with any of the terms of this
Agreement, the Company shall not be under any obligation or liability under this
Agreement (except to the extent provided in Sections 5 and 9 hereof) and the
Underwriters shall be under no obligation or liability to the Company under this
Agreement (except to the extent provided in Section 9 hereof) or to one another
hereunder.
8. Increase in Underwriters' Commitments:
If any Underwriter shall default at the Closing Time or on a Date of
Delivery in its obligation to take up and pay for the Shares to be purchased by
it under this Agreement on such date, the Representative shall have the right,
within 36 hours after such default, to make arrangements for one or more of the
non-defaulting Underwriters, or any other underwriters, to purchase all, but not
less than all, of the Shares which such Underwriter shall have agreed but failed
to take up and pay for (the "Defaulted Shares"). Absent the completion of such
arrangements within such 36-hour period, (i) if the total number of Defaulted
Shares does not exceed 10% of the total number of Shares to be purchased on such
date, each non-defaulting Underwriter shall take up and pay for (in addition to
the number of Shares which it is otherwise obligated to purchase on such date
pursuant to this Agreement) the portion of the total number of Shares agreed to
be purchased by the defaulting Underwriter on such date in the proportion that
its underwriting obligations hereunder bears to the underwriting obligations of
all non-defaulting Underwriters and (ii) if the total number of Defaulted Shares
exceeds 10% of such total, the Representative may terminate this Agreement by
notice to the Company, without liability of any party to any other party except
that the provisions of Sections 5 and 9 hereof shall at all times be effective
and shall survive such termination.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that it will
not sell any Shares hereunder on such date unless all of the Shares to be
purchased on such date are purchased on such date by the Underwriters (or by
substituted Underwriters selected by the Representative with the approval of the
Company or selected by the Company with the approval of the Representative).
If a new Underwriter or Underwriters are substituted for a defaulting
Underwriter in accordance with the foregoing provision, the Company or the
non-defaulting Underwriters shall have the right to postpone the Closing Time or
the relevant Date of Delivery for a period not exceeding five business days in
order that any necessary changes in the Registration Statement and Prospectus
and other documents may be effected.
The term "Underwriter" as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 8 with the same effect as
if such substituted Underwriter had originally been named in this Agreement.
Nothing herein will relieve a defaulting Underwriter from liability for its
default.
31
9. Indemnity and Contribution by the Company and the Underwriters:
(a) The Company and the Operating Partnership, jointly and severally,
agree to indemnify, defend and hold harmless each Underwriter and any person who
controls any Underwriter within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, from and against any loss, expense,
liability, damage or claim (including the reasonable cost of investigation)
which, jointly or severally, any such Underwriter or controlling person may
incur under the Securities Act, the Exchange Act or otherwise, insofar as such
loss, expense, liability, damage or claim arises out of or is based upon (A) any
breach of any representation, warranty or covenant of the Company or the
Operating Partnership contained herein, (B) any failure on the part of the
Company to comply with any applicable law, rule or regulation relating to the
offering of securities being made pursuant to the Prospectus, (C) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (or in the Registration Statement as amended by any
post-effective amendment thereof by the Company), the Prospectus (the term
Prospectus for the purpose of this Section 9 being deemed to include any
Preliminary Prospectus, the Prospectus and the Prospectus, each as amended or
supplemented by the Company), (D) any application or other document, or any
amendment or supplement thereto, executed by the Company or based upon written
information furnished by or on behalf of the Company filed in any jurisdiction
(domestic or foreign) in order to qualify the Shares under the securities or
blue sky laws thereof or filed with the Commission or any securities association
or securities exchange (each an "Application"), (E) any omission or alleged
omission to state a material fact required to be stated in any such Registration
Statement, Prospectus or any Application or necessary to make the statements
made therein, in the light of the circumstances under which they were made, not
misleading, or (F) any untrue statement or alleged untrue statement of any
material fact contained in any audio or visual materials used in connection with
the marketing of the Shares, including, without limitation, slides, videos,
films and tape recordings; except insofar as any such loss, expense, liability,
damage or claim arises out of or is based upon any untrue statement or alleged
untrue statement or omission or alleged omission of a material fact contained in
and in conformity with information furnished in writing by the Underwriters
through the Representative to the Company expressly for use in such Registration
Statement, Prospectus or Application. The indemnity agreement set forth in this
Section 9(a) shall be in addition to any liability which the Company or the
Operating Partnership may otherwise have.
(b) If any action is brought against an Underwriter or controlling
person in respect of which indemnity may be sought against the Company pursuant
to subsection (a) above, such Underwriter shall promptly notify the Company in
writing of the institution of such action, and the Company shall assume the
defense of such action, including the employment of counsel and payment of
expenses; provided, however, that any failure or delay to so notify the Company
will not relieve the Company of any obligation hereunder, except to the extent
that its ability to defend is actually impaired by such failure or delay. Such
Underwriter or controlling person shall have the right to employ its or their
own counsel in any such case, but the fees and expenses of such counsel shall be
at the expense of such Underwriter or such controlling person unless the
employment of such counsel shall have been authorized in writing by the Company
in connection with the defense of such action, or the Company shall not have
employed counsel reasonably satisfactory to the Underwriter or controlling
person, as the case may be, to have charge of the defense of such action within
a reasonable time or such indemnified party or parties shall have reasonably
concluded (based on the advice of counsel) that there may be defenses available
to it or them which are different from or additional to those available to the
Company (in which case the Company shall not have the right to direct the
defense of such action on behalf of the indemnified party or parties), in any of
which events such fees and expenses shall be borne by the Company and paid as
incurred (it being understood, however, that the Company shall not be liable for
the expenses of more than one separate firm of attorneys for the Underwriters or
controlling persons in any one action or series of related actions in the same
jurisdiction (other than local counsel in any such jurisdiction) representing
the indemnified parties who are parties to such action). Anything in this
paragraph to the contrary notwithstanding, the Company shall not be liable for
any settlement of any such claim or action effected without its consent.
32
(c) Each Underwriter agrees, severally and not jointly, to indemnify,
defend and hold harmless the Company, the Operating Partnership, the Company's
directors, the Company's officers that signed the Registration Statement, and
any person who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any loss,
expense, liability, damage or claim (including the reasonable cost of
investigation) which, jointly or severally, the Company, the Operating
Partnership or any such person may incur under the Securities Act, the Exchange
Act or otherwise, but only insofar as such loss, expense, liability, damage or
claim arises out of or is based upon (A) any untrue statement or alleged untrue
statement of a material fact contained in and in conformity with information
furnished in writing by such Underwriters through the Representative to the
Company expressly for use in the Registration Statement (or in the Registration
Statement as amended by any post-effective amendment thereof by the Company),
the Prospectus, or any Application or (B) any omission or alleged omission to
state a material fact in connection with such information required to be stated
either in such Registration Statement, the Prospectus, or any Application, or
necessary to make such information, in the light of the circumstances under
which made, not misleading. The statements set forth in the paragraphs under the
caption "Underwriting" in the Preliminary Prospectus and the Prospectus (to the
extent such statements relate to the Underwriters) constitute the only
information furnished by or on behalf of any Underwriter through the
Representative to the Company for purposes of Section 3(p) and this Section 9.
The indemnity agreement set forth in this Section 9(c) shall be in addition to
any liabilities that such Underwriter may otherwise have.
(d) If any action is brought against the Company, or any such person in
respect of which indemnity may be sought against any Underwriter pursuant to the
foregoing paragraph, the Company, or such person shall promptly notify the
Representative in writing of the institution of such action and the
Representative, on behalf of the Underwriters, shall assume the defense of such
action, including the employment of counsel and payment of expenses. The
Company, or such person shall have the right to employ its own counsel in any
such case, but the fees and expenses of such counsel shall be at the expense of
the Company, or such person unless the employment of such counsel shall have
been authorized in writing by the Representative, with respect to the Company,
or the Company, with respect to any such person, in connection with the defense
of such action or the Representative or the Company shall not have employed
counsel to have charge of the defense of such action within a reasonable time or
such indemnified party or parties shall have reasonably concluded (based on the
advice of counsel) that there may be defenses available to it or them which are
different from or additional to those available to the Underwriters (in which
case the Representative shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
such fees and expenses shall be borne by such Underwriter and paid as incurred
(it being understood, however, that the Underwriters shall not be liable for the
expenses of more than one separate firm of attorneys in any one action or series
of related actions in the same jurisdiction (other than local counsel in any
such jurisdiction) representing the indemnified parties who are parties to such
action). Anything in this paragraph to the contrary notwithstanding, no
Underwriter shall be liable for any settlement of any such claim or action
effected without the written consent of the Representative.
33
(e) If the indemnification provided for in this Section 9 is
unavailable or insufficient to hold harmless an indemnified party under
subsections (a), (b) and (c) of this Section 9 in respect of any losses,
expenses, liabilities, damages or claims referred to therein, then each
applicable 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, expenses, liabilities, damages or claims (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, and the Underwriters from the offering of the Shares or (ii) if (but
only if) the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company, and of the Underwriters in connection with the statements or
omissions which resulted in such losses, expenses, liabilities, damages or
claims, as well as any other relevant equitable considerations. The relative
benefits received by the Company, and the Underwriters shall be deemed to be in
the same proportion as the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the Company
bear to the underwriting discounts and commissions received by the Underwriters.
The relative fault of the Company, and of the Underwriters shall be determined
by reference to, among other things, whether the untrue statement or alleged
untrue statement of a material fact or omission or alleged omission relates to
information supplied by the Company, or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The amount paid or payable by a party as a
result of the losses, claims, damages and liabilities referred to above shall be
deemed to include any legal or other fees or expenses reasonably incurred by
such party in connection with investigating or defending any claim or action.
(f) The Company, the Operating Partnership and the Underwriters agree
that it would not be just and equitable if contribution pursuant to this Section
9 were determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to in subsection
(e)(i) and, if applicable (ii), above. Notwithstanding the provisions of this
Section 9, no Underwriters shall be required to contribute any amount in excess
of the underwriting discounts and commissions applicable to the Shares purchased
by such Underwriter. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 9 are several in proportion to their respective underwriting commitments
and not joint.
34
10. Survival:
The indemnity and contribution agreements contained in Section 9 and
the covenants, warranties and representations of the Company and the Operating
Partnership contained in Sections 3, 4 and 5 of this Agreement shall remain in
full force and effect regardless of any investigation made by or on behalf of
any Underwriter, or any person who controls any Underwriter within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act, or by or
on behalf of the Company, its directors and officers, or any person who controls
the Company within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, and shall survive any termination of this Agreement or the
sale and delivery of the Shares. The Engagement Letter shall survive the
execution, delivery, performance and termination of this Agreement (except as
otherwise provided therein). The Company, the Operating Partnership and each
Underwriter agree promptly to notify the others of the commencement of any
litigation or proceeding against it and, in the case of the Company or the
Operating Partnership, against any of their respective officers or directors, in
connection with the sale and delivery of the Shares, or in connection with the
Registration Statement or Prospectus.
11. Notices:
Except as otherwise herein provided, all statements, requests, notices
and agreements shall be in writing or by telegram and, if to the Underwriters,
shall be sufficient in all respects if delivered to Friedman, Billings, Xxxxxx &
Co., Inc., 0000 00xx Xxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention:
Syndicate Department; if to the Company, shall be sufficient in all respects if
delivered to the Company at the offices of the Company at 0000 Xxxxx Xxxxxxx
Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000, Attention: General Counsel.
12. Governing Law; Headings:
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE COMMONWEALTH OF VIRGINIA, WITHOUT REGARD TO CONFLICTS OF LAW
PRINCIPLES. The section headings in this Agreement have been inserted as a
matter of convenience of reference and are not a part of this Agreement.
13. Parties at Interest:
The Agreement herein set forth has been and is made solely for the
benefit of the Underwriters, the Company, the Operating Partnership and the
controlling persons, directors and officers referred to in Sections 9 and 10
hereof, and their respective successors, assigns, executors and administrators.
No other person, partnership, association or corporation (including a purchaser,
as such purchaser, from any of the Underwriters) shall acquire or have any right
under or by virtue of this Agreement.
14. Counterparts and Facsimile Signatures:
This Agreement may be signed by the parties in counterparts which
together shall constitute one and the same agreement among the parties. A
facsimile signature shall constitute an original signature for all purposes.
[Signature page follows.]
35
If the foregoing correctly sets forth the understanding among the
Company, the Operating Partnership and the Underwriters, please so indicate in
the space provided below for the purpose, whereupon this Agreement shall
constitute a binding agreement among the Company, the Operating Partnership and
the Underwriters.
Very truly yours,
XXXXXXX MALL PROPERTIES, INC.
By:
---------------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: President and Chief Executive Officer
XXXXXXX EQUITIES OPERATING
PARTNERSHIP, LP
By:
---------------------------------------------
Its General Partner
By:
---------------------------------------------
Name:
Title:
Accepted and agreed to as of the date first above written:
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
For itself and as Representative of the other
Underwriters named on Schedule I hereto
By:
---------------------------------------------
Name:
Title:
Schedule I
----------
Underwriter Number of Initial Shares to
----------- ---------------------------
be Purchased
------------
Friedman, Billings, Xxxxxx & Co., Inc. [ ]
RBC Capital Markets Corporation [ ]
BB&T Capital Markets, a division of
Xxxxx & Xxxxxxxxxxxx, Inc. [ ]
===============================
Total 10,666,667
Exhibit A
---------
_________________________, 2004
Friedman, Billings, Xxxxxx & Co., Inc.
0000 00xx Xxxxxx Xxxxx
00xx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Dear Sirs:
The undersigned understands that Friedman, Billings, Xxxxxx & Co., Inc.
(the "Representative") proposes to enter into an Underwriting Agreement (the
"Underwriting Agreement"), as representative of the several underwriters named
on Schedule I of the Underwriting Agreement (the "Underwriters"), with Xxxxxxx
Mall Properties, Inc., a Maryland corporation (the "Company"), providing for the
public offering (the "Public Offering") by (inter alia) the Underwriters of
shares (the "Shares") of Common Stock of the Company (the "Common Stock").
To induce the Underwriters to continue their efforts in connection with
the Public Offering, the undersigned hereby agrees that, without the prior
written consent of the Representative, it will not, during the period commencing
on the date hereof and ending on the 180-day anniversary of the date of the
final prospectus relating to the Public Offering (such period, the "Lock-Up
Period" and such prospectus, the "Prospectus"), (1) offer, pledge, sell, loan,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, or
otherwise transfer or dispose of for value, directly or indirectly, any of the
following (whether now owned by the undersigned or hereafter acquired): (i)
Common Stock, (ii) any securities convertible into or exercisable or
exchangeable for any shares of Common Stock, including any limited partnership
units ("Units") issued by Xxxxxxx Equities Operating Partnership, LP (the
"Operating Partnership") or (iii) any rights to purchase or otherwise acquire
Common Stock held by the undersigned or acquired by the undersigned after the
date hereof, or that my be deemed to be beneficially owned by the undersigned;
or (2) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of the Common
Stock or Units, whether any such transaction described in clause (1) or (2)
above is to be settled by delivery of Common Stock or such other securities, in
cash or otherwise. The undersigned further agrees that it will not publicly
disclose the intention to make any such offer, sale, pledge, or disposition or
to enter into any transaction described in the preceding sentence during the
Lock-Up Period without, in each case, the prior written consent of the
Representative. In addition, the undersigned agrees that, without prior written
consent of the Representative, it will not, during the Lock-Up Period, make any
demand for or exercise any right with respect to, the registration under the
Securities Act of 1933, as amended (the "Securities Act"), of any shares of
Common Stock or any security convertible into or exercisable or exchangeable for
Common Stock.
Notwithstanding anything to the contrary herein, the undersigned may
transfer the Common Stock or Units (A) as a bona fide gift or gifts to a member
of his or her immediate family, including any grandchildren of the undersigned;
or (B) to any trust the beneficiaries of which are exclusively the undersigned
or a member of the immediate family of the undersigned, including grandchildren;
provided, however, that for any such case under either (A) or (B) above, it
shall be a condition to such transfer that the transferee execute an agreement
stating that the transferee is receiving and holding the Common Stock or Units
subject to, and the transferee agrees to be bound by, the provisions of this
agreement, and there shall be no further transfer of such Common Stock or Units
except in accordance with this agreement; and provided further, that any such
transfer under either (A) or (B) above shall not involve a disposition for
value.
In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby authorized to decline to make any transfer that would
constitute a violation or breach of this letter. This letter shall be binding on
the undersigned and the respective successors, heirs, personal representatives
and assigns of the undersigned.
Whether or not the Public Offering actually occurs depends on a number
of factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
agreement between the Company and the Representative. The terms of this lock-up
agreement shall expire in the event the Public Offering is not consummated on or
before December 31, 2004.
Very truly yours,
--------------------------------------
(Printed or Typed Name)
By:
--------------------------------------
--------------------------------------
(SEAL)
Title:
--------------------------------