EXHIBIT 1.1
HRPT PROPERTIES TRUST
(a Maryland real estate investment trust)
6 1/2% Notes due 2013
PURCHASE AGREEMENT
December 2, 2002
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
WACHOVIA SECURITIES, INC.
BANC ONE CAPITAL MARKETS, INC.
BNY CAPITAL MARKETS, INC.
MCDONALD INVESTMENTS INC., A KEYCORP COMPANY
PNC CAPITAL MARKETS, INC.
SUNTRUST CAPITAL MARKETS, INC.
XXXXX FARGO BROKERAGE SERVICES, LLC
c/o Merrill Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
HRPT Properties Trust, a Maryland real estate investment trust (the
"Company"), confirms its agreement with Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated ("Xxxxxxx Xxxxx"), Wachovia Securities, Inc., Banc One Capital
Markets, Inc., BNY Capital Markets, Inc., McDonald Investments Inc., a KeyCorp
Company, PNC Capital Markets, Inc., SunTrust Capital Markets, Inc. and Xxxxx
Fargo Brokerage Services, LLC (collectively, the "Underwriters," which term
shall include any underwriter substituted as hereinafter provided in Section 10
hereof), with respect to the sale by the Company of $200,000,000 aggregate
principal amount of the Company's 6 1/2% Notes due 2013 (the "Notes") and the
purchase by each such Underwriter, severally, of the principal amount of such
Notes set forth opposite the name of each such Underwriter listed in Schedule A
hereto at a purchase price of 98.607% of the principal amount of the Notes The
Notes are to be issued pursuant to an indenture dated as of July 9, 1997 and a
supplemental indenture dated as of December 6, 2002 (together, the "Indenture"),
each between the Company and State Street Bank and Trust Company (the
"Trustee").
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-56051) for the
registration of debt securities, preferred shares of beneficial interest,
depositary shares, common shares of beneficial interest and warrants under the
Securities Act of 1933, as amended (the "1933 Act"), and has filed such
amendments thereto, if any, as may have been required to the date hereof. Such
registration statement has been declared effective under the 1933 Act. Such
registration statement (as amended, if applicable) and the prospectus
constituting a part thereof, as supplemented by the prospectus supplement
relating to the Notes (including, in each case, all documents incorporated or
deemed to be incorporated by reference therein), as from time to time amended or
supplemented pursuant to the 1933 Act, the Securities Exchange Act of 1934, as
amended (the "1934 Act"), or otherwise, are hereinafter referred to as the
"Registration Statement" and the "Prospectus", respectively. All references in
this Agreement to financial statements and schedules and other information which
is "contained", "included" or "stated" in the Registration Statement or the
Prospectus (and all other references of like import) shall be deemed to mean and
include all such financial statements and schedules and other information which
is or is deemed to be incorporated by reference in the Registration Statement or
in the Prospectus, as the case may be.
Section 1. Representations and Warranties.
(a) The Company represents and warrants to each Underwriter as of the
date hereof as follows:
(i) At the respective times the Registration Statement and any
post-effective amendment thereto (including the filing of the Company's
most recent Annual Report on Form 10-K with the Commission) became
effective, the Registration Statement complied in all material respects
with the requirements of the 1933 Act and the rules and regulations
under the 1933 Act (the "1933 Act Regulations") and did not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading. The Prospectus, at the date hereof (unless the
term "Prospectus" refers to a prospectus which has been provided to the
Underwriters by the Company for use in connection with the offering of
the Notes which differs from the Prospectus on file at the Commission
at the date of effectiveness of the Registration Statement, in which
case at the time it is first provided to the Underwriters for such use)
and at the Closing Time referred to in Section 2 hereof, does not and
will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; provided, however, that the representations and
warranties in this subsection (i) shall not apply to statements or
omissions in the Registration Statement or the Prospectus made in
reliance upon and in conformity with information furnished to the
Company in writing by any Underwriter through Xxxxxxx Xxxxx expressly
for use in the Registration Statement or the Prospectus.
(ii) The documents incorporated or deemed to be incorporated
by reference in the Prospectus, at the time they were or hereafter are
filed with the Commission, complied and will comply in all material
respects with the requirements of the 1934 Act and the rules and
regulations of the Commission under the 1934 Act (the "1934 Act
Regulations"), and, when read together with the other information in
the Prospectus, at the time the Registration Statement became effective
and at Closing Time, did not and will 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.
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(iii) The Company is a Maryland real estate investment trust
duly organized, validly existing and in good standing under the laws of
the State of Maryland. Each of its subsidiaries has been duly organized
and is validly existing as a corporation or trust in good standing
under the laws of its jurisdiction of incorporation or organization.
Each of the Company and its subsidiaries has full power and authority
(corporate and other) to carry on its business as described in the
Registration Statement and in the Prospectus and to own, lease and
operate its properties. Each of the Company and its subsidiaries is
duly qualified and is in good standing as a foreign corporation or
trust, as the case may be, and is authorized to do business in each
jurisdiction in which the nature of its business or its ownership or
leasing of property requires such qualification, except where the
failure to be so qualified would not have a material adverse effect on
the Company and its subsidiaries, taken as a whole.
(iv) The financial statements of the Company and its
subsidiaries, together with the related schedules and notes thereto,
included or incorporated by reference in the Registration Statement and
in the Prospectus, comply as to form in all material respects with the
requirements of the 1933 Act. Such financial statements of the Company,
together with the related schedules and notes thereto, present fairly
the consolidated financial position, results of operations,
shareholders' equity and changes in financial position of the Company
and its subsidiaries, at the dates or for the periods therein specified
and have been prepared in accordance with generally accepted accounting
principles ("GAAP") consistently applied throughout the periods
involved. The pro forma financial statements and other pro forma
financial information (including the notes thereto) included or
incorporated by reference in the Registration Statement and in the
Prospectus (i) present fairly the information shown therein, (ii) have
been prepared in accordance with the Commission's rules and guidelines
with respect to pro forma financial statements and (iii) have been
properly compiled on the basis described therein and the assumptions
used in the preparation of such pro forma financial statements and
other pro forma financial information (including the notes thereto) are
reasonable and the adjustments used therein are appropriate to give
effect to the transactions or circumstances referred to therein. The
adjusted pro forma financial statements and other adjusted pro forma
financial information (including the notes thereto) included or
incorporated by reference in the Registration Statement and in the
Prospectus (i) present fairly the information shown therein and (ii)
have been properly compiled on the basis described therein and the
assumptions used in the preparation of such adjusted pro forma
financial statements and other adjusted pro forma financial information
(including the notes thereto) are reasonable and the adjustments used
therein are appropriate to give effect to the transactions or
circumstances referred to therein.
(v) The accountants who have certified the financial
statements of the Company and its subsidiaries included or incorporated
by reference in the Registration Statement and in the Prospectus are
independent certified public accountants as required by the 1933 Act;
provided, however, the Company makes no representation or warranty with
respect to Xxxxxx Xxxxxxxx LLP, who audited the financial statements of
Hospitality Properties Trust for the year ended December 31, 2001 and
was convicted of obstruction of justice in June 2002 and ceased to
practice before the Commission on August 31, 2002.
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(vi) This Agreement has been duly authorized, executed and
delivered by the Company.
(vii) The Indenture has been duly qualified under the Trust
Indenture Act of 1939 (the "1939 Act") and has been duly authorized,
executed and delivered by the Company and is a valid and binding
agreement of the Company enforceable in accordance with its terms,
except as limited by (a) the effect of bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other similar laws
relating to or affecting the rights or remedies of creditors or (b) the
effect of general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law).
(viii) All of the issued and outstanding indebtedness of the
Company is duly and validly authorized and issued; the Notes have been
authorized by all necessary trust action and, when executed and
authenticated in accordance with the provisions of the Indenture and
delivered and paid for pursuant to this Agreement, will be valid and
binding obligations of the Company enforceable in accordance with their
terms, except as limited by (a) the effect of bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other similar laws
relating to or affecting the rights or remedies of creditors or (b) the
effect of general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law).
(ix) The Notes and the Indenture conform to the descriptions
thereof in the Registration Statement and in the Prospectus.
(x) The authorized capital of the Company, including the
Notes, conforms as to legal matters to the description thereof
contained in the Prospectus (or the documents incorporated therein by
reference).
(xi) Since the respective dates as of which information is
given in the Prospectus, and except as otherwise disclosed therein, (i)
there has been no material adverse change in the business, operations,
earnings, prospects, properties or condition (financial or otherwise)
of the Company and its subsidiaries, taken as a whole, whether or not
arising in the ordinary course of business, (ii) there have been no
material transactions entered into by the Company and its subsidiaries,
on a consolidated basis, other than transactions in the ordinary course
of business, (iii) neither the Company nor its subsidiaries has
incurred any material liabilities or obligations, direct or contingent,
(iv) the Company and its subsidiaries, on a consolidated basis, have
not, (A) other than regular quarterly dividends, declared, paid or made
a dividend or distribution of any kind on any class of its shares of
beneficial interest (other than dividends or distributions from wholly
owned subsidiaries to the Company), (B) issued any shares of beneficial
interest of the Company or any of its subsidiaries or any options,
warrants, convertible securities or other rights to purchase the shares
of beneficial interest of the Company or any of its subsidiaries (other
than the issuance of common shares of beneficial interest ("Common
Shares") upon conversion of certain convertible debentures of the
Company or the issuance of Common Shares to the trustees and officers
of the Company pursuant to the Company's Incentive Share Award Plan) or
(C) repurchased or redeemed shares of beneficial interest, and (v)
there has not been (A) any material decrease in the Company's
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net worth or (B) any material increase in the short-term or long-term
debt (including capitalized lease obligations but excluding borrowings
under existing bank lines of credit) of the Company and its
subsidiaries, on a consolidated basis.
(xii) The Company and each of its subsidiaries maintains a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability; (iii) access
to assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(xiii) Neither the Company nor any of its subsidiaries is in
violation of its respective charter or by-laws or other organizational
documents or in default in the performance of any obligation, agreement
or condition contained in any bond, debenture, note or any other
evidence of indebtedness or in any other agreement, indenture or
instrument to which the Company or any of its subsidiaries is a party
or by which any of their respective properties or assets may be bound
or affected, except for any such violation that would not have a
material adverse effect on the condition, financial or otherwise or in
the earnings, business affairs or business prospects of the Company and
its subsidiaries, taken as a whole. The Company is not in violation of
any law, ordinance, governmental rule or regulation or court decree to
which it is subject, except for any such violations that would not,
individually or in the aggregate, have a material adverse effect on the
business, operations, earnings, prospects, properties or condition
(financial or otherwise) of any of the Company and its subsidiaries,
taken as a whole.
(xiv) Except as disclosed in the Registration Statement or in
the Prospectus, there is not now pending or, to the knowledge of the
Company, threatened, any litigation, action, suit or proceeding to
which the Company is or will be a party before or by any court or
governmental agency or body, which (A) might result in any material
adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company or (B)
might materially and adversely affect the property or assets of the
Company or (C) concerns the Company and is required to be disclosed in
the Registration Statement or the Prospectus, or (D) could adversely
affect the consummation of this Agreement and the issuance, purchase
and sale of the Notes. No contract or other document is required to be
described in the Registration Statement or in the Prospectus or to be
filed as an exhibit to the Registration Statement that is not described
therein or filed as required.
(xv) The execution, delivery and performance by the Company of
this Agreement, the issuance, offering and sale by the Company of the
Notes as contemplated by the Registration Statement and by the
Prospectus and the consummation of the transactions contemplated hereby
and compliance with the terms and provisions hereof, will not violate
or conflict with or constitute a breach of any of the terms or
provisions of, or a default under, (i) the Amended and Restated
Declaration of Trust (the "Declaration of Trust") or the By-laws of the
Company or the charter or by-laws or other
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organizational documents of any subsidiaries of the Company, (ii) any
agreement, indenture or other instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of its
subsidiaries or their respective properties or assets is bound, or
(iii) any laws, administrative regulations or rulings or decrees to
which the Company or any of its subsidiaries or their respective
properties or assets may be subject.
(xvi) No consent, approval, authorization or order of, or
registration, filing or qualification with, any governmental body or
regulatory agency having jurisdiction over the Company or any of its
subsidiaries or any of their respective properties or assets is
required for the execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby,
including, without limitation, the issuance, sale and delivery of the
Notes pursuant to this Agreement, except such as have been obtained and
such as may be required under foreign and state securities or "Blue
Sky" or real estate syndication laws.
(xvii) Except as otherwise disclosed in the Registration
Statement or in the Prospectus, the Company and each of its
subsidiaries has good and marketable title or ground leases, free and
clear of all liens, claims, encumbrances and restrictions, except liens
for taxes not yet due and payable and other liens and encumbrances
which do not, either individually or in the aggregate, materially and
adversely affect the current use or value thereof, to all property and
assets described in the Registration Statement or in the Prospectus as
being owned by them. Except as otherwise set forth in the Registration
Statement or in the Prospectus, all leases to which the Company and
each of its subsidiaries is a party relating to real property, and all
other leases which are material to the business of the Company and its
subsidiaries, taken as a whole, are valid and binding, and no default
(to the Company's knowledge, in the case of leases to which the Company
is a party as lessor, that would, individually or in the aggregate,
have a material adverse effect on the business, operations, earnings,
prospects, properties or condition (financial or otherwise) of the
Company and its subsidiaries, taken as a whole) has occurred and is
continuing thereunder, and the Company and each of its subsidiaries
enjoys peaceful and undisturbed possession under all such leases to
which it is a party as lessee. With respect to all properties owned or
leased by the Company and each of its subsidiaries, the Company or such
subsidiary has such documents, instruments, certificates, opinions and
assurances, including without limitation, fee, leasehold owners or
mortgage title insurance policies (disclosing no encumbrances or title
exceptions which are material to the Company and its subsidiaries
considered as a whole, except as otherwise set forth in the
Registration Statement and in the Prospectus), legal opinions and
property insurance policies in each case in form and substance as are
usual and customary in transactions involving the purchase of similar
real estate and are appropriate for the Company or such subsidiary to
have obtained.
(xviii) The Company and each of its subsidiaries owns, or
possesses adequate rights to use, all patents, trademarks, trade names,
service marks, copyrights, licenses and other rights necessary for the
conduct of their respective businesses as described in the Registration
Statement and in the Prospectus, and neither the Company nor any of its
subsidiaries has received any notice of conflict with, or infringement
of, the asserted rights of others with respect to any such patents,
trademarks, trade names, service marks,
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copyrights, licenses and other such rights (other than conflicts or
infringements that, if proven, would not have a material adverse effect
on the business, operations, earnings, prospects, properties or
condition (financial or otherwise) of the Company and its subsidiaries,
taken as a whole), and neither the Company nor any of its subsidiaries
knows of any basis therefor.
(xix) All material tax returns required to be filed by the
Company and each of its subsidiaries in any jurisdiction have been
timely filed, other than those filings being contested in good faith,
and all material taxes, including withholding taxes, penalties and
interest, assessments, fees and other charges due pursuant to such
returns or pursuant to any assessment received by the Company or any of
its subsidiaries have been paid, other than those being contested in
good faith and for which adequate reserves have been provided.
(xx) Except for those matters which in the aggregate do not
have a material adverse effect on the business, operations, earnings,
prospects, properties or condition (financial or otherwise) of the
Company and its subsidiaries taken as a whole, and except for Hazardous
materials (as defined below) or substances which are handled and/or
disposed of in compliance with all applicable federal, state and local
requirements, to the Company's knowledge, after due investigation, the
real property owned, leased or otherwise operated by the Company and
each of its subsidiaries in connection with the operation of their
respective businesses, including, without limitation, any subsurface
soils and ground water (the "Realty"), is free of contamination from
any Hazardous Materials. To the Company's knowledge, after due
investigation, the Realty does not contain any underground storage or
treatment tanks, active or abandoned water, gas or oil xxxxx, or any
other underground improvements or structures, other than the
foundations, footings, or other supports for the improvements located
thereon which, based on present knowledge, could, in their present
condition, reasonably be expected to presently cause a material
detriment to or materially impair the beneficial use thereof by the
Company or constitute or cause a significant health, safety or other
environmental hazard to occupants or users thereof without regard to
any special conditions of such occupants or users. The Company
represents that, after due investigation, it has no knowledge of any
material violation, with respect to the Realty, of any Environmental
Law, or of any material liability on the part of the Company with
respect to the Realty, resulting from the presence, use, release,
threatened release, emission, disposal, pumping, discharge, generation
or processing of any Hazardous Materials. As used herein,
"Environmental Law" means any federal, state or local statute,
regulation, judgment, order or authorization relating to emissions,
discharges, releases or threatened releases of Hazardous Materials into
ambient air, surface water, ground water, publicly-owned treatment
works, septic systems or land, or otherwise relating to the pollution
or protection of public health or the environment, and "Hazardous
Materials" means any substance, material or waste which is regulated,
defined, or listed as a "hazardous waste", "hazardous substance",
"toxic substance", "medical waste", "infectious waste" or other similar
terms in any Environmental Law or by any federal, state or local
government or quasi-government authority, or any petroleum products,
asbestos, lead-based paint, polychlorinated biphenyls, flammable
explosives or radioactive materials.
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(xxi) Each of the Company and its subsidiaries has such
permits, licenses, franchises and authorizations of governmental or
regulatory authorities (together, "permits"), including, without
limitation, under any applicable Environmental Law, as are necessary to
own, lease and operate its properties and to engage in the business
currently conducted by it, except such licenses and permits as to which
the failure to own or possess will not in the aggregate have a material
adverse effect on the business, operations, earnings, prospects,
properties or condition (financial or otherwise) of the Company, and
the Company does not have any reason to believe that any governmental
body or agency is considering limiting, suspending or revoking any such
license, certificate, permit, authorization, approval, franchise or
right; each of the Company and its subsidiaries has fulfilled and
performed all of its material obligations with respect to such permits,
and no event has occurred which allows, or after notice or lapse of
time would allow, revocation or termination thereof or results in any
other material impairment of the rights of the holder of any such
permit; and, except as described in the Registration Statement and in
the Prospectus, such permits contain no restrictions that are
materially burdensome to the Company or any of its subsidiaries.
(xxii) To the knowledge of the Company, no labor problem
exists or is imminent with employees of the Company or any of its
subsidiaries that could have a material adverse effect on the business,
operations, earnings, prospects, properties or condition (financial or
otherwise) of the Company and its subsidiaries, taken as a whole.
(xxiii) Neither the Company nor any of its subsidiaries nor,
to the knowledge of the Company, any officer, trustee or director
purporting to act on behalf of the Company or any of its 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 of funds to, or received or
retained any funds from, any state, federal 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; or (iii) engaged in any transactions, maintained any
bank accounts 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 its subsidiaries.
(xxiv) All of the outstanding shares of beneficial interest
of, or other ownership interests in, each of the Company's subsidiaries
have been duly authorized and validly issued and are fully paid and,
except as to subsidiaries that are partnerships, nonassessable, and,
except as disclosed in the Registration Statement or in the Prospectus,
are or will be owned by the Company free and clear of any security
interest, claim, lien, encumbrance or adverse interest of any nature.
(xxv) Except as referred to or described in the Registration
Statement and in the Prospectus, none of the subsidiaries of the
Company owns any shares of stock or any other securities of any
corporation or has any equity interest in any firm, partnership,
association or other entity other than the issued capital shares of its
subsidiaries, and the Company does not own, directly or indirectly, any
shares of stock or any other securities of any corporation or have any
equity interest in any firm, partnership, association or
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other entity other than the issued capital shares of its subsidiaries,
except in each case for non-controlling positions acquired in the
ordinary course of business.
(xxvi) Except as disclosed in the Registration Statement and
in the Prospectus, there are no material outstanding loans or advances
or material guarantees of indebtedness by the Company or any of its
subsidiaries to or for the benefit of any of the officers, trustees or
directors of the Company or any of its subsidiaries or any of the
members of the families of any of them.
(xxvii) The Company and each of its subsidiaries maintains
insurance, duly in force, with insurers of recognized financial
responsibility; such insurance insures against such losses and risks as
are adequate in accordance with customary industry practice to protect
the Company and its subsidiaries and their respective businesses; and
neither the Company nor any such subsidiary has any reason to believe
that it will not be able to renew its existing insurance coverage as
and when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business at a cost
that would not materially and adversely affect the business,
operations, earnings, prospects, properties or condition (financial or
otherwise) of the Company and its subsidiaries, taken as a whole,
except as disclosed in or contemplated by the Registration Statement
and by the Prospectus.
(xxviii) Neither the Company nor any of its officers and
directors (as defined in the 1933 Act Regulations) has taken or will
take, directly or indirectly, prior to the termination of the offering
contemplated by this Agreement, any action designed to stabilize or
manipulate the price of any security of the Company, or which has
caused or resulted in, or which might in the future 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 Notes.
(xxix) Neither the Company nor any of its subsidiaries is an
"investment company" or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company" as such terms are
defined in the Investment Company Act of 1940, as amended (the "1940
Act"), or an "investment adviser" as such term is defined in the
Investment Advisers Act of 1940, as amended.
(xxx) The Company is organized in conformity with the
requirements for qualification, and, as of the date hereof the Company
operates, and as of Closing Time the Company will operate, in a manner
that qualifies the Company as a "real estate investment trust" under
the Internal Revenue Code of 1986, as amended (the "Code"), and the
rules and regulations thereunder, for 2002 and subsequent years. The
Company qualified as a real estate investment trust under the Code for
each of its taxable years from 1987 through 2001.
(xxxi) No default exists, and no event has occurred which,
with notice or lapse of time or both, would constitute a default in the
due performance and observance of any term, covenant or condition of
any indenture, mortgage, deed of trust, lease or other agreement or
instrument to which the Company or any of its subsidiaries is a party
or by
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which the Company or any of its subsidiaries or any of their respective
properties is bound or may be affected, except such defaults which,
singly or in the aggregate, would not have a material adverse effect on
the business, operations, earnings, prospects, properties or condition
(financial or otherwise) of the Company and its subsidiaries,
considered as a whole, except as disclosed in the Registration
Statement and in the Prospectus.
(xxxii) Except as otherwise disclosed in the Prospectus, since
the respective dates as of which information is given in the
Prospectus, there has been no material adverse change in the business,
operations, earnings, prospects, properties or condition (financial or
otherwise) of Reit Management & Research LLC (formerly known as Reit
Management & Research, Inc.) (the "Advisor"), whether or not arising in
the ordinary course of business, that would have a material adverse
effect on the Company and its subsidiaries, taken as a whole. The
Advisory Agreement, dated as of January 1, 1998 and Amendment No. 1
thereto, dated as of October 12, 1999 (the "Advisory Agreement"),
between the Company and the Advisor, has been duly authorized, executed
and delivered by the parties thereto and constitutes the valid
agreement of the parties thereto, enforceable in accordance with its
terms, except as limited by (a) the effect of bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other similar laws
relating to or affecting the rights or remedies of creditors or (b) the
effect of general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law).
(b) Any certificate signed by any officer of the Company or any of its
subsidiaries and delivered to the Underwriters or to counsel for the
Underwriters shall be deemed a representation and warranty by the Company to
each Underwriter as to the matters covered thereby.
Section 2. Sale and Delivery to the Underwriters; Closing.
(a) On the basis of the representations and warranties herein contained
and subject to the terms and conditions herein set forth, the Company agrees to
sell to each Underwriter, severally and not jointly, and each Underwriter,
severally and not jointly, agrees to purchase from the Company, the Notes as set
forth in Schedule A.
(b) Payment of the purchase price for and delivery of the Notes shall
be made, subject to Section 9, at the offices of Xxxxxxxx & Worcester LLP, Xxx
Xxxx Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other place as shall
be agreed upon by the Underwriters and the Company, at 9:00 A.M. on the third
(fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any given day)
business day (unless postponed in accordance with the provisions of Section 10
hereof) following the date of this Agreement, or such other time not later than
ten business days after such date as shall be agreed upon by the Underwriters
and the Company (such time and date of payment and delivery being herein called
"Closing Time"). Payment shall be made by wire transfer of immediately available
funds payable to the order of the Company against delivery to the Underwriters
of the Notes to be purchased by them. It is understood that each Underwriter has
authorized Xxxxxxx Xxxxx, for its account, to accept delivery of, receipt for,
and make payment of the purchase price for, the Notes which it has severally
agreed to purchase.
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Xxxxxxx Xxxxx, individually and not as representative of the Underwriters, may
(but shall not be obligated to) make payment of the purchase price for the Notes
to be purchased by any Underwriter whose funds have not been received by the
Closing Time, but such payment shall not relieve such Underwriter from its
obligations hereunder. The Notes shall be in such authorized denominations and
registered in such names as the Underwriters may request in writing at least one
business day before Closing Time.
Section 3. Covenants of the Company. The Company covenants with each
Underwriter as follows:
(a) Immediately following the execution of this Agreement, the Company
will prepare a Prospectus Supplement setting forth the aggregate principal
amount of Notes covered thereby and their terms not otherwise specified in the
Prospectus, the Underwriters names, the price at which the Notes are to be
purchased by the Underwriters from the Company, and such other information as
the Underwriters and the Company deem appropriate in connection with the
offering of the Notes; and the Company will promptly transmit copies of the
Prospectus Supplement to the Commission for filing pursuant to Rule 424(b) of
the 1933 Act Regulations and will furnish to the Underwriters as many copies of
the Prospectus (including such Prospectus Supplement) as they shall reasonably
request.
(b) Until the termination of the initial offering of the Notes, the
Company will notify the Underwriters immediately, and confirm the notice in
writing, (i) of the effectiveness of any amendment to the Registration
Statement, (ii) of the transmittal to the Commission for filing of any
supplement or amendment to the Prospectus or any document to be filed pursuant
to the 1934 Act, (iii) of the receipt of any comments from the Commission with
respect to the Notes, (iv) of any request by the Commission for any amendment to
the Registration Statement or any amendment or supplement to the Prospectus with
respect to the Notes or for additional information relating thereto, and (v) of
the issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or the initiation of any proceedings for that
purpose. The Company will make every reasonable effort to prevent the issuance
of any such stop order and, if any stop order is issued, to obtain the lifting
thereof at the earliest possible moment.
(c) The Company will give the Underwriters notice of its intention to
file or prepare any post-effective amendment to the Registration Statement or
any amendment or supplement (including any document to be filed pursuant to the
1934 Act prior to the termination of the initial offering of the Notes) to the
Prospectus (including any revised prospectus which the Company proposes for use
by the Underwriters in connection with the offering of the Notes which differs
from the prospectus on file at the Commission at the time that the Registration
Statement becomes effective, whether or not such revised prospectus is required
to be filed pursuant to Rule 424 (b) of the 1933 Act Regulations), will furnish
the Underwriters with copies of any such amendment or supplement a reasonable
amount of time prior to such proposed filing or use, as the case may be, and
will not file any such amendment or supplement or use any such prospectus to
which counsel for the Underwriters shall reasonably object.
(d) The Company will deliver to each of the Underwriters a conformed
copy of the Registration Statement as originally filed and of each amendment
thereto filed prior to the
11
termination of the initial offering of the Notes (including exhibits filed
therewith or incorporated by reference therein and the documents incorporated by
reference into the Prospectus pursuant to Item 12 of Form S-3).
(e) The Company will furnish to the Underwriters, from time to time
during the period when the Prospectus is required to be delivered under the 1933
Act or the 1934 Act, such number of copies of the Prospectus (as amended or
supplemented) as the Underwriters may reasonably request for the purposes
contemplated by the 1933 Act, the 1933 Act Regulations, the 1934 Act or 1934 Act
Regulations.
(f) If any event shall occur as a result of which it is necessary, in
the opinion of counsel for the Underwriters, to amend or supplement the
Prospectus in order to make the Prospectus not misleading in the light of the
circumstances existing at the time it is delivered, the Company will either (i)
forthwith prepare and furnish to the Underwriters an amendment of or supplement
to the Prospectus or (ii) make an appropriate filing pursuant to Section 13, 14
or 15 of the 1934 Act, in form and substance reasonably satisfactory to counsel
for the Underwriters, which will amend or supplement the Prospectus so that it
will not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances existing at the time it is delivered, not misleading.
(g) The Company will endeavor in good faith, in cooperation with the
Underwriters, to qualify the Notes for offering and sale under the applicable
securities laws and real estate syndication laws of such states and other
jurisdictions of the United States as the Underwriters may designate; provided
that, in connection therewith, the Company shall not be required to qualify as a
foreign corporation or trust or to file any general consent to service of
process. In each jurisdiction in which the Notes have been so qualified the
Company will file such statements and reports as may be required by the laws of
such jurisdiction to continue such qualification in effect for so long as
required for the distribution of the Notes.
(h) The Company will make generally available to its security holders
as soon as reasonably practicable, but not later than 30 days after the close of
the period covered thereby, an earning statement of the Company (in form
complying with the provisions of Rule 158 of the 1933 Act Regulations) covering
a period of at least twelve months beginning not later than the first day of the
Company's fiscal quarter next following the effective date of the Registration
Statement. "Earning statement", "make generally available" and "effective date"
will have the meanings contained in Rule 158 of the 1933 Act Regulations.
(i) The Company will use the net proceeds received by it from the sale
of the Notes in the manner specified in the Prospectus under the caption "Use of
Proceeds" in all material respects.
(j) The Company currently intends to continue to qualify as a "real
estate investment trust" under the Code, and use its best efforts to continue to
meet the requirements to qualify as a "real estate investment trust".
(k) The Company will timely file any document which it is required to
file pursuant to the 1934 Act prior to the termination of the offering of the
Notes.
12
(l) The Company will not, between the date of this Agreement and the
termination of any trading restrictions or Closing Time, whichever is later,
with respect to the Notes, without your prior written consent, offer or sell,
grant any option for the sale of, or enter into any agreement to sell, any debt
securities of the Company with a maturity of more than one year (other than the
Notes which are to be sold pursuant to this Agreement and additional or expanded
commitments to participate in the Company's revolving line of credit) except as
may otherwise be provided in this Agreement.
Section 4. Payment of Expenses. The Company will pay all expenses
incident to the performance of its obligations under this Agreement, including
(i) the preparation and filing of the Registration Statement as originally filed
and of each amendment thereto, (ii) the preparation and filing of this
Agreement, (iii) the preparation, issuance and delivery of the Notes to the
Underwriters, (iv) the fees and disbursements of counsel for the Company,
referred to in Section 5(b) hereof, and the Company's accountants, (v) the
qualification of the Notes under securities laws and real estate syndication
laws in accordance with the provisions of Section 3(g) hereof, including filing
fees and the fee and disbursements of counsel for the Company in connection
therewith and in connection with the preparation of any Blue Sky Survey, (vi)
the printing and delivery to the Underwriters of copies of the Registration
Statement as originally filed and of each amendment thereto, and of the
Prospectus and any amendments or supplements thereto, (vii) any fees charged by
nationally recognized statistical rating organizations for the rating of the
Notes, (viii) the cost of printing or reproducing and delivering to the
Underwriters copies of any Blue Sky Survey, (ix) the cost of providing any CUSIP
or other identification numbers for the Notes, (x) the fees and expenses of any
depositary in connection with the Notes, and (xi) any transfer taxes imposed on
the sale of the Notes to the Underwriters.
If this Agreement is terminated by the Underwriters in accordance with
the provisions of Section 5 or Section 9(a)(i), the Company shall reimburse the
Underwriters for all of their out-of-pocket expenses, including the reasonable
fees and disbursements of counsel for the Underwriters.
Section 5. Conditions of the Underwriters' Obligations. The obligations
of the Underwriters hereunder are subject to the accuracy of the representations
and warranties of the Company herein contained, to the performance by the
Company of its obligations hereunder, and to the following further conditions:
(a) At Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission. The price of the Notes and
any other information previously omitted from the effective Registration
Statement pursuant to Rule 415 of the 1933 Act Regulations shall have been
transmitted to the Commission for filing pursuant to Rule 424 (b) of the 1933
Act Regulations within the prescribed time period, and prior to Closing Time the
Company shall have provided evidence satisfactory to the Underwriters of such
timely filing, or a post-effective amendment providing such information shall
have been filed and declared effective in accordance with the requirements of
the 1933 Act Regulations.
13
(b) At Closing Time the Underwriters shall have received the favorable
opinion, dated as of Closing Time, of Xxxxxxxx & Worcester LLP, counsel for the
Company, in form and substance satisfactory to counsel for the Underwriters, to
the effect that:
(i) The Company is a Maryland real estate investment trust
duly organized, validly existing and in good standing under the laws of
the State of Maryland; each of its Significant Subsidiaries (as defined
in Rule 1-02 of Regulation S-X under the 1933 Act) has been duly
organized, is validly existing as a corporation or trust in good
standing under the laws of its jurisdiction of incorporation or
organization; each of the Company and its subsidiaries has the trust or
corporate (as applicable) power and authority to carry on its business
as described in the Registration Statement and in the Prospectus and to
own, lease and operate its properties; each of the Company and its
subsidiaries is duly qualified and is in good standing as a foreign
corporation or trust, as the case may be, authorized to do business in
each jurisdiction in which its ownership or leasing of property
requires such qualification, except where the failure to be so
qualified would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(ii) All of the issued and outstanding shares of beneficial
interest of, or other ownership interests in, each of the Company's
subsidiaries have been duly authorized and validly issued and are fully
paid and, except as to subsidiaries that are partnerships,
non-assessable, and are owned by the Company free and clear of any
security interest or other adverse interest (within the meaning of
Article 8 of the Massachusetts Uniform Commercial Code).
(iii) The Company has the requisite trust power and authority
to enter into and perform this Agreement and to issue and deliver the
Notes.
(iv) This Agreement and the Indenture have been duly
authorized, executed and delivered by the Company.
(v) The Indenture is a valid and binding obligation of the
Company enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws
affecting creditors' rights generally and equitable principles; and the
Indenture has been duly qualified under the 0000 Xxx.
(vi) The Notes have been duly authorized and, when executed
and authenticated in accordance with the provisions of the Indenture
and delivered and paid for in accordance with the terms of this
Agreement, will be valid and binding obligations of the Company
enforceable in accordance with their terms subject to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws
affecting creditors' rights generally and equitable principles; and the
holders of the Notes are entitled to the benefit of the Indenture.
(vii) The execution, delivery and performance of this
Agreement, and the consummation of the transactions herein contemplated
will not conflict with or constitute a breach or violation of any of
the terms or provisions of, or constitute a default under, (A) the
Declaration of Trust or the By-laws of the Company or the charter or
by-laws or
14
other organizational documents of any Significant Subsidiary of the
Company, (B) except as disclosed in the Prospectus, any material
agreement, indenture or other instrument to which the Company, or any
of its Significant Subsidiaries or their respective material properties
or assets is bound, or (C) any laws, administrative regulations or
rulings or decrees known to such counsel to which the Company, any of
its Significant Subsidiaries or their respective material properties or
assets may be subject.
(viii) No consent, approval, authorization, order,
registration, filing, qualification, license or permit of or with any
federal, Massachusetts or Maryland court or public, governmental or
regulatory agency or body having jurisdiction over the Company or any
of its Significant Subsidiaries or any of their respective material
properties or assets is required for the Company's execution, delivery
and performance of this Agreement and the consummation of the
transactions contemplated hereby, including, without limitation, the
issuance, sale and delivery of the Notes pursuant to this Agreement,
except such as have been obtained and such as may be required under
foreign and state securities or "Blue Sky" laws.
(ix) The Registration Statement has become effective under the
1933 Act, and, to the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or
threatened by the Commission; and any required filing of the Prospectus
pursuant to Rule 424 under the 1933 Act has been made in accordance
with said Rule 424.
(x) To such counsel's knowledge, except as disclosed in the
Registration Statement or in the Prospectus, there is not now pending
or threatened, any litigation, action, suit or proceeding to which the
Company or any of its subsidiaries is or will be a party before or by
any court or governmental agency or body, which (A) might result in any
material adverse change in the condition, financial or otherwise, or in
the business, operations, earnings, prospects or properties of the
Company and its subsidiaries, taken as a whole, or (B) might materially
and adversely affect the property or assets of the Company and its
subsidiaries, taken as a whole, or (C) concerns the Company or any of
its subsidiaries and is required to be disclosed in the Prospectus, or
(D) could adversely affect the consummation of this Agreement and the
issuance of the Notes; to such counsel's knowledge, no contract or
other document is required to be described in the Registration
Statement or in the Prospectus or to be filed as an exhibit to the
Registration Statement that is not described therein or filed as
required.
(xi) Except as otherwise disclosed in the Prospectus, to such
counsel's knowledge, neither the Company nor any of its subsidiaries is
in violation of its respective charter or by-laws or other
organizational documents or in default in the performance of any
obligation, agreement or condition contained in any bond, debenture,
note or any other evidence of indebtedness or in any other material
agreement, indenture or instrument to which the Company or any of its
subsidiaries is a party or by which any of their respective properties
or assets may be bound or affected, except for any such violation that
would not have a material adverse effect on the business, operations,
15
earnings, business prospects, properties or condition (financial or
otherwise) of the Company and its subsidiaries taken as a whole.
(xii) To such counsel's knowledge, each of the Company and its
subsidiaries has such permits, licenses, franchises and authorizations
of governmental or regulatory authorities (together, "permits"),
including, without limitation, under any applicable Environmental Law,
as are necessary to own, lease and operate its properties and to engage
in the business currently conducted by it, except such licenses and
permits as to which the failure to own or possess will not in the
aggregate have a material adverse effect on the business, operations,
earnings, business prospects, properties or condition (financial or
otherwise) of the Company and its subsidiaries, taken as a whole.
(xiii) The Registration Statement and the Prospectus and any
supplements or amendments thereto (except for the financial statements
and the notes thereto and the schedules and other financial data
included therein and the part of the Registration Statement that
constitutes the Statement of Eligibility (Form T-1) of the Trustee
under the 1939 Act, as to which such counsel need not express any
opinion) comply as to form in all material respects with the
requirements of the 1933 Act.
(xiv) Each document incorporated by reference in the
Registration Statement and in the Prospectus (except for the financial
statements and the notes thereto and the schedules and other financial
data included therein, as to which such counsel need not express any
opinion) complied as to form when filed with the Commission in all
material respects with the requirements of the 1934 Act.
(xv) To the extent required to be described therein, the Notes
conform in all material respects to the descriptions in the
Registration Statement and the Prospectus.
(xvi) The statements (a) in the Prospectus under the captions
"Description of Debt Securities", "Description of the Notes",
"Description of Shares", "Redemption; Business Combinations and Control
Share Acquisitions," "Limitation of Liability; Shareholder Liability"
and "Certain Federal Income Tax Considerations" and (b) in Item 1 of
the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1998 under the captions "Regulation and Reimbursement,"
"Federal Income Tax Considerations" and "ERISA Plans, Xxxxx Plans and
Individual Retirement Accounts" in each case insofar as they purport to
summarize matters arising under Massachusetts or Maryland law or the
federal law of the United States, or provisions of documents to which
the Company is a party specifically referred to therein, are accurate
summaries of such legal matters or provisions.
(xvii) The Company has qualified to be taxed as a real estate
investment trust pursuant to Sections 856-860 of the Code for each of
the fiscal years ended December 31, 1987 through December 31, 2001, and
the Company's current anticipated investments and its current plan of
operation will enable it to continue to meet the requirements for
qualification and taxation as a real estate investment trust under the
Code; actual qualification of the Company as a real estate investment
trust, however, will depend upon the Company's continued ability to
meet, and its meeting, through actual annual
16
operating results and distributions, the various qualification tests
imposed under the Code.
(xviii) The Company is not required to register as an
"investment company" within the meaning of the 1940 Act.
(xix) The Advisor (A) is a limited liability company duly
organized, validly existing and in good standing under the laws of the
State of Delaware, and (B) has the requisite limited liability company
power and authority to conduct its business as described in the
Prospectus and to own and operate its material properties.
(xx) The Advisory Agreement has been duly authorized, executed
and delivered by the parties thereto and constitutes the valid
agreement of the parties thereto, enforceable in accordance with its
terms, except (a) as limited by the effect of bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or other similar laws
relating to or affecting the rights or remedies of creditors, (b) as
limited by the effect of general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law) and
(c) insofar as the enforceability of the indemnity and contribution
provisions contained in such agreement may be limited by federal or
state securities laws and the public policy underlying such laws.
(xxi) Although counsel has not undertaken, except as otherwise
indicated in their opinion, to determine independently, and does not
assume any responsibility for, the accuracy or completeness of the
statements in the Registration Statement, such counsel has participated
in the preparation of the Registration Statement and the Prospectus,
including review and discussion of the contents thereof (including
review and discussion of the contents of all documents incorporated by
reference in the Registration Statement and the Prospectus), and
nothing has come to the attention of such counsel that has caused them
to believe that the Registration Statement (including the documents
incorporated by reference therein) at the time the Registration
Statement became effective, or the Prospectus, as of its date and as of
Closing Time, as the case may be, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or
that any amendment or supplement to the Prospectus, as of its
respective date, and as of Closing Time, as the case may be, contained
any untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading (it being
understood that such counsel need express no view with respect to the
financial statements and the notes thereto and the schedules and other
financial data included or incorporated by reference in the
Registration Statement or in the Prospectus or the part of the
Registration Statement that constitutes the Statement of Eligibility
(Form T-1) of the Trustee under the 1939 Act.
In rendering their opinion as aforesaid, Xxxxxxxx & Worcester LLP may
rely upon an opinion, dated as of Closing Time, of Xxxxxxx Xxxxx Xxxxxxx &
Ingersoll, LLP as to matters governed by Maryland law, provided that such
reliance is expressly authorized by such opinion and a copy of such opinion is
delivered to the Underwriters and is, in form and substance,
17
satisfactory to the Underwriters and counsel for the Underwriters. In addition,
in rendering such opinion, such counsel may state that their opinion as to laws
of the State of Delaware is limited to the Delaware General Corporation Law and
that their opinion with respect to the qualification of the Company and its
subsidiaries to do business in jurisdictions other than their respective
jurisdictions of organization is based solely upon certificates to such effect
issued by an appropriate official of the applicable jurisdictions.
The opinion of Xxxxxxx Xxxxx Xxxxxxx & Xxxxxxxxx, LLP described in the
paragraph above shall be rendered to the Underwriters at the request of the
Company and shall so state therein.
(c) The Underwriters shall have received at Closing Time an opinion,
dated as of Closing Time, of Sidley Xxxxxx Xxxxx & Xxxx LLP, counsel for the
Underwriters, as to the matters referred to in clauses (iv), (v), (vi), (ix),
(xiii), (xv) and (xxi) of the foregoing paragraph (b). In giving such opinion
with respect to the matters covered by clause (xxi), such counsel may state that
their opinion and belief are based upon their participation in the preparation
of the Registration Statement and the Prospectus and any amendments or
supplements thereto and review and discussion of the contents thereof, but are
without independent check or verification except as specified.
In rendering their opinion as aforesaid, Sidley Xxxxxx Xxxxx & Xxxx LLP
may rely upon an opinion, dated as of Closing Time, of Xxxxxxx Xxxxx Xxxxxxx &
Ingersoll, LLP as to matters governed by Maryland law, and the opinion of
Xxxxxxxx & Worcester LLP referred to above as to matters governed by
Massachusetts law. In addition, in rendering such opinion, such counsel may
state that their opinion as to laws of the State of Delaware is limited to the
Delaware General Corporation Law.
(d) At Closing Time (i) the Registration Statement and the Prospectus
shall contain all statements which are required to be stated therein in
accordance with the 1933 Act and the 1933 Act Regulations and in all material
respects shall conform to the requirements of the 1933 Act and the 1933 Act
Regulations, and neither the Registration Statement nor the Prospectus shall
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading and no action, suit or proceeding at law or in equity shall be
pending or to the knowledge of the Company threatened against the Company which
would be required to be set forth in the Prospectus other than as set forth
therein, (ii) there shall not have been, since the respective dates as of which
information is given in the Registration Statement and the Prospectus, any
material adverse change in the condition, financial or otherwise, of the Company
or in its earnings, business affairs or business prospects, whether or not
arising in the ordinary course of business from that set forth in the
Registration Statement, and (iii) no proceedings shall be pending or, to the
knowledge of the Company, threatened against the Company before or by any
federal, state or other commission, board or administrative agency wherein an
unfavorable decision, ruling or finding would materially and adversely affect
the business, property, financial condition or income of the Company other than
as set forth in the Prospectus; and the Underwriters shall have received, at
Closing Time, a certificate of the President and Chief Operating Officer and the
chief financial officer of the Company, dated as of Closing Time, evidencing
compliance with
18
the provisions of this subsection (d) and stating that the representations and
warranties set forth in Section 1(a) hereof are accurate as though expressly
made at and as of Closing Time.
(e) At Closing Time, there shall not have been, since the respective
dates as of which information is given in the Registration Statement and the
Prospectus, any material adverse change in the business, operations, earnings,
prospects, properties or condition (financial or otherwise) of the Advisor,
whether or not arising in the ordinary course of business; and the Underwriters
shall have received, at Closing Time, a certificate of the President of the
Advisor evidencing compliance with this subsection (e).
(f) Concurrently with the execution and delivery of this Agreement, and
at Closing Time prior to payment and delivery of the Notes, Ernst & Young LLP
shall have furnished to the Underwriters a letter, dated the date of its
delivery, addressed to the Underwriters and in form and substance satisfactory
to the Underwriters, confirming that they are independent accountants with
respect to the Company as required by the 1933 Act and the 1933 Act Regulations
and with respect to the financial and and numerical information contained in the
Registration Statement and the Prospectus or incorporated by reference therein.
Each such letter shall contain information of the type customarily included in
accountants' comfort letters to underwriters.
(g) At Closing Time counsel for the Underwriters shall have been
furnished with such documents and opinions as they may reasonably require for
the purpose of enabling them to pass upon the issuance and sale of the Notes as
herein contemplated and related proceedings, or in order to evidence the
accuracy of any of the representations or warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Notes as herein contemplated shall
be reasonably satisfactory in form and substance to the Underwriters and counsel
for the Underwriters.
(h) Subsequent to the execution and delivery of this Agreement and
prior to Closing Time, there shall not have occurred any downgrading, nor shall
any notice have been given of (i) any intended or potential downgrading or (ii)
any review or possible change that indicates anything other than a stable
outlook, in the rating accorded any securities of or guaranteed by the Company
by any "nationally recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the 1933 Act.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice to the Company at any time at or prior to Closing
Time, and such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof.
Section 6. Indemnification. (a) The Company hereby agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls each
Underwriter within the meaning of Section 15 of the 1933 Act as follows:
(1) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, arising out of any
untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or any amendment
thereto), or the omission or alleged omission therefrom of a
material
19
fact required to be stated therein or necessary to make the
statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact
included in any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto), or the omission, or
alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading:
(2) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of
the aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any governmental agency or
body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, if such settlement is
effected with the written consent of the Company; and
(3) against any and all expense whatsoever, as
incurred (including, subject to Section 6(c) hereof, the fees
and disbursements of counsel chosen by Xxxxxxx Xxxxx),
reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceedings by
any governmental agency or body, commenced or threatened, or
any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to
the extent that any such expense is not paid under paragraph
(1) or (2) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through Xxxxxxx Xxxxx expressly for use in the Registration
Statement (or any amendment thereto) or the Prospectus (or any amendment or
supplement thereto); and provided, further, that the foregoing indemnity
agreement with respect to any preliminary prospectus shall not inure to the
benefit of any Underwriter, or the benefit of any person controlling any
Underwriter, if a copy of the Prospectus (as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto and excluding
documents incorporated or deemed to be incorporated by reference therein) was
not sent or given by or on behalf of such Underwriter to such person asserting
any such losses, claims, damages or liabilities at or prior to the written
confirmation of the sale of such Notes to such person, if required by law so to
have been delivered, and if the Prospectus (as so amended or supplemented) would
have cured the defect giving rise to such loss, claim, damage or expense.
(b) Each Underwriter agrees to indemnify and hold harmless the Company,
each of the Company's trustees, each of the Company's officers who signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section 6, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto) or the Prospectus (or any amendment or
supplement
20
thereto) in reliance upon and in conformity with written information furnished
to the Company by any Underwriter through Xxxxxxx Xxxxx expressly for use in the
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto).
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
which it may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the defense of such
action. In no event shall the indemnifying parties be liable for fees and
expenses of more than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in connection with any one
action or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances.
Section 7. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 6 hereof is for any reason held to be unenforceable by the indemnified
parties although applicable in accordance with its terms, the Company and the
Underwriters shall contribute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by said indemnity agreement
incurred by the Company and the Underwriters, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Notes pursuant to this Agreement or (ii) if the allocation provided by
clause (i) 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 on the one hand and of the
Underwriters on the other hand in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other hand in connection with the offering of the Notes
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Notes pursuant to
this Agreement (before deducting expenses) received by the Company and the total
discount received by the Underwriters, bear to the aggregate initial offering
price of the Notes.
The relative fault of the Company on the one hand and the Underwriters
on the other hand shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation or by any other method of allocation which does not take into account
the equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be
21
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. Notwithstanding the
provisions of this Section 7, the Underwriters shall not be required to
contribute any amount in excess of the amount by which the total price at which
the Notes purchased from the Company by the Underwriters and distributed to the
public were offered to the public exceeds the amount of any damages which the
Underwriters have otherwise been required to pay in respect of such losses,
liabilities, claims, damages and expenses. For purposes of this Section 7, each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the 1933 Act shall have the same rights to contribution as such Underwriter, and
each trustee of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act shall have the same rights to
contribution as the Company.
Section 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company submitted pursuant
hereto, shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of the Underwriters or any controlling
person, or by or on behalf of the Company, and shall survive delivery of the
Notes to the Underwriters.
Section 9. Termination of Agreement. (a) The Underwriters may terminate
this Agreement, by notice to the Company, at any time at or prior to Closing
Time (i) if there has been, since the respective dates as of which information
is given in the Registration Statement, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries, taken as a whole, or the
Advisor, whether or not arising in the ordinary course of business, which would
make it, in the Underwriters' reasonable judgment, impracticable or inadvisable
to market the Notes or enforce contracts for the sale of the Notes, (ii) if
there has occurred any material adverse change in the financial markets in the
United States or any outbreak of hostilities or escalation of existing
hostilities or other calamity or crisis or any change or development involving a
prospective change in national or international political, financial or economic
conditions, in each case the effect of which is such as to make it, in the
Underwriters' reasonable judgment, impracticable or inadvisable to market the
Notes or enforce contracts for the sale of the Notes, or (iii) if trading in the
Company's Common Shares has been suspended by the Commission, or if trading
generally on either the New York Stock Exchange or the American Stock Exchange
has been suspended, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices for securities have been required, by either of said
exchanges or by order of the Commission or any other governmental authority, or
a material disruption has occurred in commercial banking or securities
settlement or clearance services in the United States, or (iv) if a banking
moratorium has been declared by Federal or New York authorities.
22
(b) If this Agreement is terminated pursuant to this Section 9, such
termination shall be without liability of any party to any other party except as
provided in Section 4, and provided, further, that Sections 6 and 7 hereof shall
survive such termination.
Section 10. Default. If one or more of the Underwriters shall fail at
Closing Time to purchase the Notes which it or they are obligated to purchase
under this Agreement (the "Defaulted Notes"), the Underwriters shall have the
right, within 24 hours thereafter, 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 Defaulted Notes in such amounts as may be agreed upon and
upon the terms herein set forth; if, however, the Underwriters shall not have
completed such arrangements within such 24-hour period, then:
(i) if the total principal amount of Defaulted Notes does not
exceed 10% of the Notes to be purchased pursuant to this Agreement, the
non-defaulting Underwriters shall be obligated to purchase the full
amount thereof in the proportions that their respective underwriting
obligations hereunder bear to the underwriting obligations of all
non-defaulting Underwriters, or
(ii) if the total principal amount of Defaulted Notes exceeds
10% of the Notes to be purchased pursuant to this Agreement, this
Agreement shall terminate without liability on the part of any
non-defaulting Underwriter and the Company.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement, either the Underwriters or the Company shall have the right
to postpone Closing Time for a period not exceeding seven days in order to
effect any required changes in the Prospectus or in any other documents or
arrangements.
Section 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Underwriters in c/o Merrill Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated at World Financial Center, North Tower, 000 Xxxxx
Xxxxxx, Xxx Xxxx, XX 00000-0000, Attention: Xxxx Xxxxx; and notices to the
Company shall be directed to it at 000 Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000, Attention: Xxxxx X. Xxxxxxx, President.
Section 12. Parties. This Agreement shall inure to the benefit of and
be binding upon the Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than those
referred to in Sections 6 and 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
parties hereto and thereto and their respective successors and said controlling
persons and officers, trustees and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of
23
Notes from any Underwriter shall be deemed to be a successor by reason merely of
such purchase.
Section 13. Governing Law and Time; Miscellaneous. This Agreement shall
be governed by and construed in accordance with the laws of the State of New
York applicable to agreements made and to be performed in said State. Specified
times of day refer to New York City time.
THE AMENDED AND RESTATED DECLARATION OF TRUST ESTABLISHING THE COMPANY,
DATED JULY 1, 1994, A COPY OF WHICH, TOGETHER WITH ALL AMENDMENTS THERETO (THE
"DECLARATION"), IS DULY FILED IN THE OFFICE OF THE STATE DEPARTMENT OF
ASSESSMENTS AND TAXATION OF MARYLAND, PROVIDES THAT THE NAME "HRPT PROPERTIES
TRUST" REFERS TO THE TRUSTEES UNDER THE DECLARATION COLLECTIVELY AS TRUSTEES,
BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE, OFFICER, SHAREHOLDER,
EMPLOYEE OR AGENT OF THE COMPANY SHALL BE HELD TO ANY PERSONAL LIABILITY,
JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, THE COMPANY. ALL
PERSONS DEALING WITH THE COMPANY, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF
THE COMPANY FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.
24
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument along with all counterparts will become a binding agreement between
the Underwriters and the Company in accordance with its terms.
Very truly yours,
HRPT PROPERTIES TRUST
By /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: President
CONFIRMED AND ACCEPTED, as of
the date first above written:
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
WACHOVIA SECURITIES, INC.
BANC ONE CAPITAL MARKETS, INC.
BNY CAPITAL MARKETS, INC.
MCDONALD INVESTMENTS INC., A KEYCORP COMPANY
PNC CAPITAL MARKETS, INC.
SUNTRUST CAPITAL MARKETS, INC.
XXXXX FARGO BROKERAGE SERVICES, LLC
By: Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
By /s/ Xxxxx Xxxxx
Name: Xxxxx Xxxxx
Title: Vice President
Acting on behalf of themselves and
the other named Underwriters in Schedule A
25
SCHEDULE A
Aggregate Principal
Underwriter Amount of Notes
---------------------------------------------- ---------------------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated................................ $ 130,000,000
Wachovia Securities, Inc............................. 34,000,000
Banc One Capital Markets, Inc........................ 6,000,000
BNY Capital Markets, Inc............................. 6,000,000
McDonald Investments Inc., a KeyCorp Company......... 6,000,000
PNC Capital Markets, Inc............................. 6,000,000
SunTrust Capital Markets, Inc........................ 6,000,000
Xxxxx Fargo Brokerage Services, LLC.................. 6,000,000
---------
Total....................................... $ 200,000,000
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