Exhibit 1.1
LIBERTY PROPERTY LIMITED PARTNERSHIP
(a Pennsylvania Limited Partnership)
$85,000,000 6.375% SENIOR NOTES DUE 2012
UNDERWRITING AGREEMENT
January 10, 2003
Credit Suisse First Boston Corporation
UBS Warburg LLC
c/o Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Liberty Property Trust, a Maryland real estate investment trust (the "Company"),
and Liberty Property Limited Partnership, a Pennsylvania limited partnership
(the "Operating Partnership" and, together with the Company, the "Transaction
Entities"), each wishes to confirm as follows its agreement with Credit Suisse
First Boston Corporation ("CSFB") and UBS Warburg LLC (the "Underwriters," which
term shall also include any underwriter substituted as hereinafter provided in
Section 9 of this Agreement), with respect to the sale by the Operating
Partnership and the purchase by the Underwriters, acting severally and not
jointly, of $85,000,000 aggregate principal amount of its 6.375% Senior Notes
due 2012 (the "Notes"), as further described on Schedule II hereto.
Capitalized terms used but not otherwise defined herein shall have
the meanings given to those terms in the Prospectus (as herein defined).
1. Representations, Warranties and Agreements of the Transaction
Entities. Each of the Transaction Entities, jointly and severally, represents,
warrants and agrees that, as of the date hereof:
(a) A registration statement on Form S-3 (No. 333-39282) (the
"Registration Statement") and any amendments thereto, with respect
to one or more series of debt securities of the Operating
Partnership has (i) been prepared by the Company and the Operating
Partnership in conformity with the requirements of the United States
Securities Act of 1933, as amended (the "Securities Act") and the
rules and regulations (the "Rules and Regulations") of the United
States Securities and Exchange Commission (the "Commission")
thereunder, (ii) been filed with the Commission under the Securities
Act and (iii) become effective under the Securities Act; and the
indenture, dated as of October 24, 1997 as supplemented to the date
hereof (the "Indenture"), between the
Operating Partnership and Bank One Trust Company, N.A. (as successor
to The First National Bank of Chicago), as trustee (the "Trustee")
has been qualified, and the Sixth Supplemental Indenture, dated as
of August 22, 2002, between the Operating Partnership and the
Trustee (the "Supplemental Indenture"), pursuant to which the Notes
shall be issued, has been qualified, under the Trust Indenture Act
of 1939 (the "Trust Indenture Act"). Copies of such registration
statement and any amendments thereto have been delivered by the
Company to you. As used in this Agreement, "Effective Time" means,
for the Registration Statement, the date and the time as of which
the Registration Statement, or the most recent post-effective
amendment thereto, if any, was declared effective by the Commission;
"Effective Date" means, for the Registration Statement, the date of
the Effective Time; "Preliminary Prospectus" means any prospectus
included in the Registration Statement, or amendments thereto,
before it became effective under the Securities Act and any
prospectus filed with the Commission by the Company with the consent
of the Underwriters pursuant to Rule 424(a) of the Rules and
Regulations; "Registration Statement" means the Registration
Statement, as amended at the Effective Time, including any documents
incorporated by reference therein at such time and all information
contained in the final prospectus filed with the Commission pursuant
to Rule 424(b) of the Rules and Regulations and deemed to be a part
of such registration statement as of the respective Effective Time
pursuant to paragraph (b) of Rule 430A of the Rules and Regulations,
and shall include any registration statement filed pursuant to Rule
462(b) of the Rules and Regulations; and "Prospectus" means such
final prospectus, as first filed with the Commission pursuant to
paragraph (1) or (4) of Rule 424(b) of the Rules and Regulations.
Any reference herein to the Registration Statement, the Prospectus
or a Preliminary Prospectus shall be deemed to include the documents
incorporated or deemed to be incorporated by reference therein which
were filed under the Securities and Exchange Act of 1934, as amended
(the "Exchange Act"). For purposes of this Agreement, all references
to the Registration Statement, any Preliminary Prospectus or the
Prospectus or any amendment or supplement to any of the foregoing
shall be deemed to include the copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval
system ("XXXXX").
(b) Each Preliminary Prospectus, if any, included as part of
the Registration Statement as originally filed or as part of any
amendment or supplement thereto, or filed pursuant to Rule 424 under
the Rules and Regulations, complied when so filed in all material
respects with the provisions of the Securities Act and the rules and
regulations thereunder, and each Preliminary Prospectus, if any,
delivered to the Underwriters for use in connection with this
offering was identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the
extent permitted by Regulation S-T.
(c) On its Effective Date and on the Effective Date of any
amendment thereto, the Registration Statement conformed in all
material
2
respects, and as of the date of this Agreement, the Registration
Statement conforms in all material respects, and the Prospectus and
any further amendments or supplements to the Registration Statement
or the Prospectus will, when they become effective or are filed with
the Commission, as the case may be, conform in all material respects
to the requirements of the Securities Act, the Rules and Regulations
and the Trust Indenture Act and the rules and regulations
thereunder, and do not and will not, as of the applicable Effective
Date (as to the Registration Statement and any amendment thereto)
and as of the applicable filing date and at the Delivery Date (as
defined below) (as to the Prospectus and any amendment or supplement
thereto) 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 (with respect to the
Prospectus, in light of the circumstances under which they were
made); provided that no representation or warranty is made as to
information contained in or omitted from the Registration Statement
or the Prospectus in reliance upon and in conformity with written
information furnished to the Company through the Underwriters by or
on behalf of any Underwriter specifically for inclusion therein. The
Indenture and the Supplemental Indenture conform, in all material
respects to the requirements of the Trust Indenture Act and the
rules and regulations thereunder; provided, however, that no
representation or warranty is made as to information contained in or
omitted from that part of the Registration Statement which shall
constitute the Statement of Eligibility and Qualification on Form
T-1 under the Trust Indenture Act of the Trustee under the
Indenture. The Prospectus delivered to the Underwriters for use in
connection with this offering was identical to the electronically
transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
(d) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement as of the applicable
Effective Date, the Prospectus as of its date or any Preliminary
Prospectus as of its date, complied in all material respects with
the Exchange Act and the rules and regulations thereunder, and none
of such documents, at such dates, 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, in the
light of the circumstances under which they were made, not
misleading.
(e) No stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and no
proceeding for that purpose has been instituted or, to the knowledge
of either of the Transaction Entities, threatened by the Commission
or by the state securities authority of any jurisdiction. No order
preventing or suspending the use of any Preliminary Prospectus or
the Prospectus has been issued and no proceeding for that purpose
has been instituted or, to the knowledge of either of the
Transaction Entities, after due inquiry of the Commission,
threatened by the Commission or by the state securities authority of
any jurisdiction.
(f) The Company has been duly formed and is validly existing
as a real estate investment trust in good standing under the laws of
the State of
3
Maryland, is duly qualified to do business and is in good standing
in each jurisdiction in which its ownership or lease of property or
the conduct of its business requires such qualification, and has all
power and authority necessary to own or hold its properties, to
conduct the business in which it is engaged and to enter into and
perform its obligations under this Agreement. None of the
subsidiaries of the Company (other than the Operating Partnership)
is a "significant subsidiary," as such term is defined in Rule 405
of the Rules and Regulations. Except as described in the Prospectus
and other than the Property Affiliates (as defined herein) and the
Operating Partnership, Development Corp. and SP Trust, the Company
owns no direct or indirect equity interest in any entity, except for
such interests as, in the aggregate, are not material to the
condition, financial or otherwise, or the earnings, assets, business
affairs or business prospects of the Company and its subsidiaries
considered as a single enterprise.
(g) All of the issued shares of beneficial interest of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description thereof
contained in the Prospectus. Except as disclosed in the Prospectus
and with respect to the Trust's Amended and Restated Share Incentive
Plan (the "Share Incentive Plan"), the Company's Employee Stock
Purchase Plan and the Company's Dividend Reinvestment and Share
Purchase Plan, no shares of beneficial interest of the Company are
reserved for any purpose and except for the equity interests in the
Operating Partnership ("Units") and options to purchase shares of
beneficial interest issued pursuant to the Share Incentive Plan,
there are no outstanding securities convertible into or exchangeable
for any shares of beneficial interest of the Company, and no
outstanding options, rights (preemptive or otherwise) or warrants to
purchase or subscribe for shares of beneficial interest or any other
securities of the Company.
(h) The Operating Partnership has been duly formed and is
validly existing as a limited partnership in good standing under the
laws of the Commonwealth of Pennsylvania, is duly qualified to do
business and is in good standing as a foreign limited partnership in
each jurisdiction in which its ownership or lease of property or the
conduct of its business requires such qualification (each such
jurisdiction as provided in Schedule III), and has all partnership
power and authority necessary to own or hold its properties, to
conduct the business in which it is engaged and to enter into and
perform its obligations under this Agreement. The Company is the
sole general partner of the Operating Partnership. The limited
partnership agreement of the Operating Partnership, as amended (the
"Operating Partnership Agreement") is in full force and effect, and
the aggregate percentage interests of the Company and the limited
partners in the Operating Partnership are as set forth in the
Prospectus. The owner's equity of the Operating Partnership is as
described in the Prospectus. All of the Units have been duly and
validly authorized and issued, are fully paid and, to the extent
that such interests are owned by the Company, are owned by the
Company free and clear of all liens, encumbrances, equities or
claims.
4
(i) Liberty Property Development Corp. ("Development Corp.")
has been duly organized and is validly existing as a corporation in
good standing under the laws of the Commonwealth of Pennsylvania, is
duly qualified to do business and is in good standing in each
jurisdiction in which its ownership or lease of property or the
conduct of its business requires such qualification, and has all
corporate power and authority necessary to own or hold its
properties and to conduct the business in which it is engaged. All
of the issued and outstanding capital stock of Development Corp. has
been duly authorized and validly issued and is fully paid and
non-assessable, has been offered and sold in compliance with all
applicable laws (including, without limitation, federal or state
securities laws) and all of the capital stock of Development Corp.
owned by the Operating Partnership, as described in the Prospectus,
is owned free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim, restriction or equities. No shares of
capital stock of Development Corp. are reserved for any purpose, and
there are no outstanding securities convertible into or exchangeable
for any capital stock of Development Corp., and no outstanding
options, rights (preemptive or otherwise) or warrants to purchase or
to subscribe for shares of such capital stock or any other
securities of Development Corp.
(j) Liberty Property Development Corp-II ("Development-II")
has been duly organized and is validly existing as a corporation in
good standing under the laws of the Commonwealth of Pennsylvania, is
duly qualified to do business and is in good standing in each
jurisdiction in which its ownership or lease of property or the
conduct of its business requires such qualification, and has all
corporate power and authority necessary to own or hold its
properties and to conduct the business in which it is engaged. All
of the issued and outstanding capital stock of Development-II has
been duly authorized and validly issued and is fully paid and
non-assessable, has been offered and sold in compliance with all
applicable laws (including, without limitation, federal or state
securities laws) and all of the capital stock of Development-II
owned by the Operating Partnership, as described in the Prospectus,
is owned free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim, restriction or equities. No shares of
capital stock of Development-II are reserved for any purpose, and
there are no outstanding securities convertible into or exchangeable
for any capital stock of Development-II, and no outstanding options,
rights (preemptive or otherwise) or warrants to purchase or to
subscribe for shares of such capital stock or any other securities
of Development-II.
(k) Liberty Property Special Trust ("SP Trust") has been duly
organized and is validly existing as a business trust in good
standing under the laws of the Commonwealth of Pennsylvania, is duly
qualified to do business and is in good standing as a foreign
corporation in each jurisdiction in which its ownership or lease of
property or the conduct of its business requires such qualification,
and has all corporate power and authority necessary to own or hold
its properties and to conduct the business in which it is engaged.
All of the issued and outstanding equity interests of SP Trust have
been duly authorized and validly issued and are fully paid and
non-assessable, has been offered and sold in
5
compliance with all applicable laws (including, without limitation,
federal or state securities laws) and all of the equity interests of
SP Trust are owned by the Company free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim, restriction or
equities. No shares of equity interests of SP Trust are reserved for
any purpose, and there are no outstanding securities convertible
into or exchangeable for any equity interests of SP Trust and no
outstanding options, rights (preemptive or otherwise) or warrants to
purchase or to subscribe for shares of such equity interests or any
other securities of SP Trust
(l) Each of those certain partnerships, limited liability
companies or other entities holding title to one or more of the
Properties (the "Property Affiliates") are the only entities other
than the Operating Partnership, SP Trust, Liberty Property
Philadelphia Corp., a Pennsylvania corporation, Liberty Property
Philadelphia Trust, a Pennsylvania trust, Liberty Property
Philadelphia Corp-IV East, a Pennsylvania corporation, Liberty
Property Philadelphia Corp-IV West, a Pennsylvania corporation, LP
Malvern LLC, a Pennsylvania limited liability company, and Liberty
UK Development Corp., a Pennsylvania corporation, through which the
Company and the Operating Partnership own interests in the
Properties. Each of the Property Affiliates has been duly organized
and is validly existing as a limited partnership, limited liability
company or other entity, is duly qualified to do business and is in
good standing under the laws of the jurisdiction in which it was
organized, is duly qualified to do business and is in good standing
as a foreign entity in each jurisdiction in which its ownership or
lease of property or the conduct of its business requires such
qualification, and has all power and authority necessary to own or
hold its properties and to conduct the business in which it is
engaged. Except as set forth in the Prospectus, all of the ownership
interests of each Property Affiliate have been duly and validly
authorized and issued, are fully paid and non-assessable and all of
the ownership interests owned directly or indirectly by the Company
and the Operating Partnership, as described in the Prospectus, are
owned free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim, restriction or equities.
(m) The Notes have been duly and validly authorized and, when
duly executed, authenticated, issued and delivered against payment
therefor as provided herein and in the Indenture, will be duly and
validly issued and outstanding, and shall constitute valid and
binding obligations on the part of the Operating Partnership,
entitled to the benefits of the Indenture, and enforceable against
the Operating Partnership in accordance with their terms. Upon
payment of the purchase price and delivery of the Notes in
accordance herewith, each of the Underwriters will receive good,
valid and marketable title to the Notes, free and clear of all
security interests, mortgages, pledges, liens, encumbrances, claims,
restrictions and equities.
(n) The Indenture has been duly and validly authorized,
executed and delivered by the Operating Partnership and, assuming
due authorization, execution and delivery by the Trustee,
constitutes a valid and binding agreement of the Operating
Partnership, enforceable against the Operating Partnership in
6
accordance with its terms; the Supplemental Indenture has been duly
and validly authorized, executed and delivered by the Operating
Partnership and, (assuming due execution and delivery by the
Trustee), constitutes a valid and binding agreement of the Operating
Partnership, enforceable against the Operating Partnership in
accordance with its terms; the Notes, the Indenture and the
Supplemental Indenture conform in all material respects to the
descriptions thereof contained in the Prospectus.
(o) (A)This Agreement has been duly and validly authorized,
executed and delivered by each of the Transaction Entities, and
assuming due authorization, execution and delivery by the
Underwriters, is a valid and binding agreement of each of the
Transaction Entities, enforceable against the Transaction Entities
in accordance with its terms; and (B) the Operating Partnership
Agreement and the partnership agreement of each Property Affiliate
have been duly and validly authorized, executed and delivered by the
parties thereto and are valid and binding agreements of the parties
thereto, enforceable against such parties in accordance with their
terms.
(p) The execution, delivery and performance of this Agreement
by each of the Transaction Entities, the execution, delivery and
performance of the Indenture by the Operating Partnership and the
consummation of the transactions contemplated hereby and thereby
will not conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which either of the Transaction Entities
is a party or by which either of the Transaction Entities is bound
or to which any of the Properties or other assets of either of the
Transaction Entities is subject, nor will such actions result in any
violation of the provisions of the charter, by-laws, certificate of
limited partnership or agreement of limited partnership of either of
the Transaction Entities, or any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over either of the Transaction Entities or any of their
properties or assets; and except for the registration of the Notes
under the Securities Act and the qualification of the Indenture
under the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be required
under the Exchange Act and applicable state securities laws in
connection with the purchase and distribution of the Notes by the
Underwriters, no consent, approval, authorization or order of, or
filing or registration with, any such court or governmental agency
or body is required for the execution, delivery and performance of
this Agreement by the Transaction Entities or the Indenture by the
Operating Partnership, the consummation of the transactions
contemplated hereby and thereby, and the issuance and delivery of
the Notes.
(q) No event has occurred and is continuing that, had the
Notes been issued, would (whether or not with the giving of notice
and/or the passage of time and/or the fulfillment of any other
requirement) constitute an Event of Default (as defined in the
Indenture) under the Indenture.
7
(r) Other than as described in the Prospectus, as disclosed to
representatives of the Underwriters and other than rights of certain
persons who have contributed Properties to the Partnership in
exchange for Units and persons whose securities are already
registered under the Securities Act, and except with respect to
certain persons who may acquire preferred shares of the Company in
exchange for preferred units of partnership interest in the
Operating Partnership, there are no contracts, agreements or
understandings between the Transaction Entities and any person
granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any
securities of either of the Transaction Entities owned or to be
owned by such person or to require either of the Transaction
Entities to include such securities in the securities registered
pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Transaction Entities under the Securities Act.
(s) Except as described or contemplated in the Prospectus or
pursuant to the Share Incentive Plan, and except for the issuance of
common shares in exchange for Units, neither Transaction Entity has
sold or issued any securities during the six-month period preceding
the date of the Prospectus, including any sales pursuant to Rule
144A or Regulations D or S under, the Securities Act.
(t) Neither of the Transaction Entities nor any of the
Properties has sustained, since the date of the latest audited
financial statements included in the Prospectus, any material loss
or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree,
other than as set forth or contemplated in the Prospectus; and,
since such date, there has not been any material change in the
capital stock or long-term debt of either of the Transaction
Entities or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the
Properties or the general affairs, management, financial position,
shareholders' equity or results of operations of either of the
Transaction Entities, other than as set forth or contemplated in the
Prospectus.
(u) The financial statements (including the related notes and
supporting schedules thereto) filed as part of, or incorporated by
reference in, the Registration Statement and the Prospectus present
fairly the financial condition and results of operations of the
entities purported to be shown thereby, at the dates and for the
periods indicated, and have been prepared in conformity with
generally accepted accounting principles applied on a consistent
basis throughout the periods involved. The Company's ratios of
earnings to fixed charges (actual and, if any, pro forma) included
in the Prospectus under the captions "Certain Ratios" and in Exhibit
12.1 to the Registration Statement have been calculated in
compliance with Item 503(d) of Regulation S-K of the Commission. Pro
forma financial information included in or incorporated by reference
in the Registration Statement and the Prospectus has been prepared
in accordance with the applicable requirements of the Securities
Act, the Rules and Regulations and AICPA
8
guidelines with respect to pro forma financial information and
includes all adjustments necessary to present fairly the pro forma
financial position of the respective entity or entities presented
therein at the respective dates indicated and the results of
operations for the respective periods specified.
(v) Xxxxx & Young LLP, who have certified certain financial
statements of the Operating Partnership, whose reports appear in the
Prospectus or are incorporated by reference therein and who have
delivered the initial letter referred to in Section 7(f) hereof, are
independent public accountants as required by the Securities Act and
the Rules and Regulations.
(w) (A) The Operating Partnership and the Property Affiliates
have good and marketable title to each of the Properties, free and
clear of all liens, encumbrances, claims, security interests and
defects, other than those referred to in the Prospectus, those
relating to certain intra-company debt with respect to Development
and Development-II or those which are not material in amount or
those which would not have a material adverse effect on the
business, operations, use or value of any of the Properties; (B) all
liens, charges, encumbrances, claims or restrictions on or affecting
any of the Properties and the assets of any Transaction Entity which
are required to be disclosed in the Prospectus are disclosed
therein; (C) except as otherwise described in the Prospectus,
neither Transaction Entity and, to the knowledge of the Transaction
Entities, no tenant of any of the Properties is in default under (i)
any space leases (as lessor or lessee, as the case may be) relating
to the Properties, or (ii) any of the mortgages or other security
documents or other agreements encumbering or otherwise recorded
against the Properties, in each case which default would have a
material adverse effect on the applicable Property, and neither
Transaction Entity knows of any event which, but for the passage of
time or the giving of notice, or both, would constitute such a
default under any of such documents or agreements; (D) each of the
Properties complies with all applicable codes, laws and regulations
(including, without limitation, building and zoning codes, laws and
regulations and laws relating to access to the Properties), except
for such failures to comply that would not have a material adverse
effect on the business operations, use or value of such Property;
and (E) neither Transaction Entity has knowledge of any pending or
threatened condemnation proceedings, zoning change or other
proceeding or action that will in any material manner adversely
affect the size of, use of, improvements on, construction on or
access to the Properties.
(x) The mortgages and deeds of trust which encumber the
Properties are not convertible into equity securities of the entity
owning such Property and said mortgages and deeds of trust are not
cross-defaulted or cross-collateralized with any property other than
other Properties.
(y) The Operating Partnership and the Property Affiliates have
obtained title insurance on the fee or leasehold interests in each
of the Properties, in an amount at least equal to the greater of (A)
the mortgage indebtedness of
9
each such Property or (B) the purchase price (exclusive of
improvements) of each such Property.
(z) Except as disclosed in the Prospectus and except such as
in each case would not have a material adverse effect on any
Property, Property Affiliate, or Transaction Entity or any of their
subsidiaries, taken together as a whole; (A) to the knowledge of the
Transaction Entities, after due inquiry, (i) the operations of the
Company, the Operating Partnership, Development Corp., Development
II and SP Trust, and (ii) the Properties are in compliance with all
Environmental Laws (as defined below) and all requirements of
applicable permits, licenses, approvals and other authorizations
issued pursuant to Environmental Laws; (B) to the knowledge of the
Transaction Entities, after due inquiry, none of the Transaction
Entities, the Property Affiliates or any Property has caused or
suffered to occur any Release (as defined below) of any Hazardous
Substance (as defined below) into the Environment (as defined below)
on, in, under or from any Property, and no condition exists on, in,
under or adjacent to any Property that could result in the
incurrence of liabilities under, or any violations of, any
Environmental Law or give rise to the imposition of any Lien (as
defined below), under any Environmental Law; (C) none of the
Transaction Entities or Property Affiliates has received any written
notice of a claim under or pursuant to any Environmental Law or
under common law pertaining to Hazardous Substances on, in, under or
originating from any Property; (D) neither of the Transaction
Entities has actual knowledge of, or received any written notice
from any Governmental Authority (as defined below) claiming, any
violation of any Environmental Law or a determination to undertake
and/or request the investigation, remediation, clean-up or removal
of any Hazardous Substance released into the Environment on, in,
under or from any Property; and (E) no Property is included or, to
the knowledge of the Transaction Entities, after due inquiry,
proposed for inclusion on the National Priorities List issued
pursuant to CERCLA (as defined below) by the United States
Environmental Protection Agency (the "EPA") or on the Comprehensive
Environmental Response, Compensation, and Liability Information
System database maintained by the EPA, and neither of the
Transaction Entities has actual knowledge that any Property has
otherwise been identified in a published writing by the EPA as a
potential CERCLA removal, remedial or response site or, to the
knowledge of the Transaction Entities, is included on any similar
list of potentially contaminated sites pursuant to any other
Environmental Law.
As used herein, "Hazardous Substance" shall include any hazardous
substance, hazardous waste, toxic substance, pollutant or hazardous
material, including, without limitation, oil, petroleum or any
petroleum-derived substance or waste, asbestos or
asbestos-containing materials, PCBs, pesticides, explosives,
radioactive materials, dioxins, urea formaldehyde insulation or any
constituent of any such substance, pollutant or waste which is
subject to regulation under any Environmental Law (including,
without limitation, materials listed in the United States Department
of Transportation Optional Hazardous Material Table, 49 C.F.R.
Section 172.101, or in the EPA's List of Hazardous Substances and
Reportable
10
Quantities, 40 C.F.R. Part 302); "Environment" shall mean any
surface water, drinking water, ground water, land surface,
subsurface strata, river sediment, buildings, structures, and
ambient, workplace and indoor and outdoor air; "Environmental Law"
shall mean the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended (42 U.S.C. Section 9601 et
seq.) ("CERCLA"), the Resource Conservation and Recovery Act of
1976, as amended (42 U.S.C. Section 6901, et seq.), the Clean Air
Act, as amended (42 U.S.C. Section 7401, et seq.), the Clean Water
Act, as amended (33 U.S.C. Section 1251, et seq.), the Toxic
Substances Control Act, as amended (15 U.S.C. Section 2601, et
seq.), the Occupational Safety and Health Act of 1970, as amended
(29 U.S.C. Section 651, et seq.), the Hazardous Materials
Transportation Act, as amended (49 U.S.C. Section 1801, et seq.),
and all other federal, state and local laws, ordinances,
regulations, rules and orders relating to the protection of the
Environment or of human health from environmental effects;
"Governmental Authority" shall mean any federal, state or local
governmental office, agency or authority having the duty or
authority to promulgate, implement or enforce any Environmental Law;
"Lien" shall mean, with respect to any Property, any lien,
encumbrance, penalty, fine, charge, assessment, judgment or other
liability in, on or affecting such Property; and "Release" shall
mean any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping, emanating or
disposing of any Hazardous Substance into the Environment,
including, without limitation, the abandonment or discard of
barrels, containers, tanks (including, without limitation,
underground storage tanks) or other receptacles containing or
previously containing any Hazardous Substance.
(aa) Each Transaction Entity and each of their subsidiaries
carries, or is covered by, insurance in such amounts and covering
such risks as is adequate for the conduct of its business and as is
customary for companies engaged in similar businesses in similar
industries; and each Property carries, or is covered by, insurance
covering the value of such Property.
(bb) Each Transaction Entity owns or possesses adequate rights
to use all material patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service mark
registrations, copyrights and licenses necessary for the conduct of
its business and has no reason to believe that the conduct of its
business will conflict with, and has not received any notice of any
claim of conflict with, any such rights of others.
(cc) Except as described in the Prospectus, there are no legal
or governmental proceedings pending to which either Transaction
Entity or their subsidiaries is a party or of which any property or
assets of either Transaction Entity or their subsidiaries is the
subject which, if determined adversely to such Transaction Entity or
subsidiary, could reasonably be expected to have a material adverse
effect on the consolidated financial position, shareholders' equity,
results of operations, business or prospects of the Company; and to
the knowledge of the Transaction Entities, no such proceedings are
threatened or contemplated by governmental authorities or threatened
by others.
11
(dd) There are no contracts or other documents which are
required to be described in the Prospectus or filed as exhibits to
the Registration Statement by the Securities Act or by the Rules and
Regulations which have not been described in the Prospectus or filed
as exhibits to the Registration Statement or incorporated therein by
reference as permitted by the Rules and Regulations.
(ee) No relationship, direct or indirect, exists between or
among either of the Transaction Entities on the one hand, and the
trustees, officers, shareholders, customers or suppliers of the
Transaction Entities on the other hand, that is required to be
described in the Prospectus that is not so described.
(ff) No labor disturbance by the employees of either
Transaction Entity exists or, to the knowledge of the Transaction
Entities, is imminent which might be expected to have a material
adverse effect on the consolidated financial position, shareholders'
equity, results of operations, business or prospects of such
Transaction Entity.
(gg) Each "pension plan" for which either Transaction Entity
would have any liability that is intended to be qualified under
section 401(a) of the Code is (i) so qualified in all material
respects and nothing has occurred, whether by action or by failure
to act, which would cause the loss of such qualification and (ii) 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"); to the knowledge of the Transaction Entities,
after due inquiry, no "reportable event" (as defined in ERISA) has
occurred with respect to any "pension plan" (as defined in ERISA)
for which either Transaction Entity would have any liability;
neither Transaction Entity has incurred or expects to incur
liability under (i) Title IV of ERISA with respect to termination
of, or withdrawal from, any "pension plan" or (ii) sections 412 or
4971 of the Internal Revenue Code of 1986, as amended, including the
regulations and published interpretations thereunder (the "Code");
and.
(hh) Each Transaction Entity and their subsidiaries has filed
all federal, state and local income and franchise tax returns
required to be filed through the date hereof and has paid all taxes
due thereon, and no material tax deficiency has been determined
adversely to either Transaction Entity or their subsidiaries which
has had (nor does either Transaction Entity have any knowledge of
any tax deficiency which, if determined adversely to it might have)
a material adverse effect on the financial position, shareholders'
equity, results of operations, business or prospects of such
Transaction Entity or subsidiary.
(ii) At all times since June 16, 1994, the Company, the
Operating Partnership, Development Corp., Development II and SP
Trust have been, and upon the sale of the Notes will continue to be,
organized and operated in conformity with the requirements for
qualification and taxation of the Company as a real estate
investment trust under the Code and the proposed method of
12
operation of the Company, the Operating Partnership, Development
Corp., Development II and SP Trust will enable the Company to
continue to meet the requirements for qualification and taxation as
a real estate investment trust under the Code.
(jj) Since the date as of which information is given in the
Prospectus through the date hereof, and except as may otherwise be
disclosed or contemplated in the Prospectus, neither Transaction
Entity has (i) issued or granted any securities, (ii) incurred any
liability or obligation, direct or contingent, other than
liabilities and obligations which were incurred in the ordinary
course of business, (iii) entered into any transaction not in the
ordinary course of business nor (iv) declared or paid any dividend
on its capital stock (other than regular quarterly dividends).
(kk) Each Transaction Entity and each of their subsidiaries
(i) makes and keeps accurate books and records and (ii) maintains
internal accounting controls which provide reasonable assurance that
(A) transactions are executed in accordance with management's
authorization, (B) transactions are recorded as necessary to permit
preparation of its financial statements and to maintain
accountability for its assets, (C) access to its assets is permitted
only in accordance with management's authorization and (D) the
reported accountability for its assets is compared with existing
assets at reasonable intervals.
(ll) No Transaction Entity or any of their subsidiaries (i) is
in violation of its charter, by-laws, certificate of limited
partnership, agreement of limited partnership or other similar
organizational document, (ii) is in default in any material respect,
and no event has occurred which, with notice or lapse of time or
both, would constitute such a default, in the due performance or
observance of any term, covenant or condition contained in any
material indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it is
bound or to which any of the Properties or any of its other
properties or assets is subject or (iii) is in violation in any
material respect of any law, ordinance, governmental rule,
regulation or court decree to which it or the Properties or any of
its other properties or assets may be subject or has failed to
obtain any material license, permit, certificate, franchise or other
governmental authorization or permit necessary to the ownership of
the Properties or any of its other properties or assets or to the
conduct of its business.
(mm) Neither Transaction Entity, nor any trustee, officer,
agent, employee or other person associated with or acting on behalf
of either Transaction Entity, has used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expense
relating to political activity; made any direct or indirect unlawful
payment to any foreign or domestic government official or employee
from corporate funds; violated or is in violation of any provision
of the Foreign Corrupt Practices Act of 1977; or made any bribe,
rebate, payoff, influence payment, kickback or other unlawful
payment.
13
(nn) Neither Transaction Entity nor any of their subsidiaries
is an "investment company" within the meaning of such term under the
Investment Company Act of 1940 and the rules and regulations of the
Commission thereunder.
(oo) Other than this Agreement and as set forth in the
Prospectus under the heading "Underwriting," there are no contracts,
agreements or understandings between either Transaction Entity and
any person that would give rise to a valid claim against either
Transaction Entity or any Underwriter for a brokerage commission,
finder's fee or other like payment with respect to the consummation
of the transactions contemplated by this Agreement.
(pp) Each Transaction Entity has complied with all applicable
provisions of Florida Statutes Section 517.075, relating to issuers
doing business with Cuba.
2. Purchase of the Notes by the Underwriters. On the basis of the
representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Operating Partnership agrees to sell to the
several Underwriters, and each of the Underwriters, severally and not jointly,
agrees to purchase from the Operating Partnership, the respective principal
amount of Notes set forth opposite that Underwriter's name in Schedule I hereto
at the purchase price set forth in Schedule II hereto plus accrued interest, if
any, from the date specified in Schedule II hereto to the date of payment and
delivery.
The obligation of the Underwriters to purchase and pay for the Notes
may be satisfied by CSFB by delivering to the Operating Partnership in exchange
for the Notes (x) $75,000,000 aggregate principal amount of the Operating
Partnership's 6.375% Putable/Callable Medium-Term Notes due January 15, 2013,
Putable/Callable January 15, 2003 (the "Exchange Notes") (or such lesser amount
of the Exchange Notes as CSFB actually holds or as is equal to the purchase
price of the Notes as set forth in Schedule II), in accordance with arrangements
established between the Operating Partnership and the Underwriters, and (y) a
cash payment in accordance with Section 4 equal to the excess, if any, of the
purchase price of the Notes as set forth in Schedule II hereto over $82,752,414.
The Exchange Notes will be delivered on the Closing Date through the facilities
of The Depository Trust Company to Bank One, National Association, as Trustee,
for the account of the Operating Partnership. Delivery of the Exchange Notes
will be deemed to have occurred when the Operating Partnership receives notice
from the Trustee that the Trustee's (or its nominee's) account with The
Depository Trust Company has been credited with the Exchange Notes. Each
Underwriter has authorized CSFB (for such Underwriter's account) to make payment
of the purchase price for the Notes as set forth in Schedule II in accordance
with the procedures set forth in this paragraph.
3. Offering of Notes by the Underwriters. The several Underwriters
propose to offer the Notes for sale upon the terms and conditions set forth in
the Prospectus.
4. Delivery of and Payment for the Notes. Delivery of and payment
for the Notes shall be made at the office of Clifford Chance US LLP, 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 A.M., New York City time, on the
third full business day following the
14
date of this Agreement or on the fourth full business day if this Agreement is
executed after the daily closing time of the New York Stock Exchange (unless
postponed in accordance with the provisions of Section 9 hereof), or at such
other date or place as shall be determined by agreement between the Underwriters
and the Operating Partnership. This date and time are sometimes referred to as
the "Delivery Date." On the Delivery Date, the Operating Partnership shall
deliver or cause to be delivered the Notes to the Underwriters for the account
of each Underwriter against payment to or upon the order of the Operating
Partnership of the purchase price by delivery of the Exchange Notes as described
in Section 2 and, with respect to any additional purchase price as provided in
Section 2, by certified or official bank check or checks payable in same day
funds or, at the discretion of the Operating Partnership, by wire transfer in
same day funds to an account at a bank acceptable to the Underwriters. Time
shall be of the essence, and delivery at the time and place specified pursuant
to this Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Notes shall be registered in such names and in
such denominations as the Underwriters shall request in writing not less than
two full business days prior to the Delivery Date. For the purpose of expediting
the checking and packaging of the Notes, the Operating Partnership shall make
the Notes available for inspection by the Underwriters in New York, New York,
not later than 2:00 P.M., New York City time, on the business day prior to the
Delivery Date.
5. Further Agreements of the Transaction Entities. Each of the
Transaction Entities jointly and severally agrees:
(a) To prepare the Prospectus in a form approved by the
Underwriters and to file such Prospectus pursuant to Rule 424(b)
under the Securities Act not later than the Commission's close of
business on the second business day following the execution and
delivery of this Agreement or, if applicable, such earlier time as
may be required by Rule 430A(a)(3) under the Securities Act; to make
no further amendment or any supplement to the Registration Statement
or to the Prospectus except in accordance with Section 5(e) hereof
and except for the Form 8-K; to advise the Underwriters, promptly
after it receives notice thereof, of the time when any amendment to
the Registration Statement has been filed or becomes effective or
any supplement to the Prospectus or any amended Prospectus has been
filed and to furnish the Underwriters with copies thereof; to advise
the Underwriters, promptly after it receives notice thereof, of the
issuance by the Commission of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or
the Prospectus, of the suspension of the qualification of the Notes
for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any
request by the Commission for the amending or supplementing of the
Registration Statement or the Prospectus or for additional
information; and, in the event of the issuance of any stop order or
of any order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus or suspending any such qualification,
to use promptly its best efforts to obtain its withdrawal;
(b) To furnish promptly to the Underwriters and to counsel for
the Underwriters such number of conformed copies as the Underwriters
shall reasonably request of the Registration Statement as originally
filed with the Commission, and each amendment thereto filed with the
15
Commission, including all consents and exhibits filed therewith or
incorporated by reference therein and all documents incorporated by
reference therein;
(c) To deliver promptly to the Underwriters such number of the
following documents as the Underwriters shall reasonably request:
(i) conformed copies of the Registration Statement as originally
filed with the Commission and each amendment thereto (in each case
excluding exhibits other than this Agreement) and (ii) each
Preliminary Prospectus, the Prospectus and any amended or
supplemented Prospectus; and, if the delivery of a prospectus is
required at any time after the applicable Effective Time in
connection with the offering or sale of the Notes or any other
securities relating thereto and if at such time any events shall
have occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made when such Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the Securities Act
or the Exchange Act, to notify the Underwriters and, upon their
request, to file such document and to prepare and furnish without
charge to each Underwriter and to any dealer in securities as many
copies as the Underwriters may from time to time reasonably request
of an amended or supplemented Prospectus which will correct such
statement or omission or effect such compliance. The aforementioned
documents furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(d) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the
Prospectus that may, in the judgment of the Company or counsel for
the Underwriters, be required by the Securities Act or requested by
the Commission;
(e) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus or any
Prospectus pursuant to Rule 424 of the Rules and Regulations, to
furnish a copy thereof to the Underwriters and counsel for the
Underwriters within a reasonable period of time prior to the filing
thereof, and that filing thereof shall not occur if the Underwriters
shall have objected in good faith thereto;
(f) The Operating Partnership will make generally available to
its security holders as soon as practicable but no later than 60
days after the close of the period covered thereby an earnings
statement (in form complying with the provisions of Section 11(a) of
the Securities Act and Rule 158 of the Rules and Regulations), which
need not be certified by independent certified public accountants
unless required by the Securities Act or the Rules and Regulations,
16
covering a twelve-month period commencing after the "effective date"
(as defined in said Rule 158) of the Registration Statement;
(g) The Company and the Operating Partnership will file any
reports required to be furnished to the Commission pursuant to the
Exchange Act or any rule or regulation of the Commission thereunder
on XXXXX to the extent required to be filed via XXXXX;
(h) Promptly from time to time to take such action as the
Underwriters may reasonably request to qualify the Notes for
offering and sale under the securities or real estate syndication of
such jurisdictions as the Underwriters may request and to comply
with such laws so as to permit the continuance of sales and dealings
therein in such jurisdictions for as long as may be necessary to
complete the distribution of the Notes, except that the Operating
Partnership shall not be required in connection therewith to qualify
as a foreign corporation or to execute a consent to service of
process in any jurisdiction;
(i) Until the Delivery Date, neither the Operating Partnership
nor the Company will, directly or indirectly, offer for sale,
contract to sell, sell or otherwise dispose of, or register for sale
under the Securities Act, any debt securities, or sell or grant
options, rights or warrants with respect to any debt securities,
without the prior written consent of the Underwriters;
(j) To apply the net proceeds from the sale of the Notes in
accordance with the description set forth in the Prospectus under
the caption "Use of Proceeds";
(k) To take such steps as shall be necessary to ensure that
none of the Company, the Operating Partnership or any of their
subsidiaries shall become an "investment company" within the meaning
of such term under the Investment Company Act of 1940 and the rules
and regulations of the Commission thereunder;
(l) Except as stated in this Agreement and in the Preliminary
Prospectus, if any, and Prospectus, neither Transaction Entity has
taken, nor will take, directly or indirectly, any action designed to
or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of the Notes to
facilitate the sale or resale of the Notes;
(m) The Company will use its best efforts to continue to meet
the requirements to qualify as a "real estate investment trust"
under the Code; and
(n) If this Agreement shall be terminated by the Underwriters
because of any failure or refusal on the part of the Transaction
Entities to comply with the terms or fulfill any of the conditions
of this Agreement, the Transaction Entities jointly and severally
agree to reimburse the Underwriters for all reasonable out-of-pocket
expenses (including fees and expenses of counsel for the
Underwriters) incurred by the Underwriters in connection herewith.
17
6. Expenses. The Transaction Entities jointly and severally agree to
pay (a) the costs incident to the authorization, issuance, sale and delivery of
the Notes and any taxes payable in connection therewith; (b) the costs incident
to the preparation, printing and filing under the Securities Act of the
Registration Statement and any amendments and exhibits thereto; (c) the costs of
distributing the Registration Statement as originally filed and each amendment
thereto and any post-effective amendments thereof (including, in each case,
exhibits), any Preliminary Prospectus, the Prospectus and any amendment or
supplement to the Prospectus, all as provided in this Agreement; (d) the costs
of producing and distributing this Agreement and any other related documents in
connection with the offering, purchase, sale and delivery of the Notes; (e) the
filing fees incident to securing any required review by the National Association
of Securities Dealers, Inc. of the terms of sale of the Notes; (f) any
applicable listing or other fees; (g) the fees and expenses of qualifying the
Notes under the securities laws of the several jurisdictions as provided in
Section 5(h) and of preparing, printing and distributing a Blue Sky Memorandum
(including related fees and expenses of counsel to the Underwriters); (h) the
fees paid to rating agencies in connection with the rating of the Notes; and (i)
all other costs and expenses incident to the performance of the obligations of
the Transaction Entities under this Agreement; provided that, except as provided
in this Section 6 and in Section 12, the Underwriters shall pay their own costs
and expenses, including the costs and expenses of their counsel, any transfer
taxes on the Notes which they may sell and the expenses of advertising any
offering of the Notes made by the Underwriters.
7. Conditions of Underwriters' Obligations. The respective
obligations of the Underwriters hereunder are subject to the accuracy, when made
and on the Delivery Date, of the representations and warranties of the
Transaction Entities contained herein, to the performance by each Transaction
Entity of its obligations hereunder, and to each of the following additional
terms and conditions:
(a) If, at the time this Agreement is executed and delivered,
it is necessary for the Registration Statement or a post-effective
amendment thereto to be declared effective before the offering of
the Notes may commence, the Registration Statement or such
post-effective amendment shall have become effective not later than
5:30 P.M., New York City time, on the date hereof, or at such later
date and time as shall be consented to in writing by you, and all
filings, if any, required to have been made by such time by Rules
424 and 430A under the Rules and Regulations shall have been timely
made; no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for that purpose
shall have been instituted or, to the knowledge of the Transaction
Entities or any Underwriter, threatened by the Commission, and any
request of the Commission for additional information (to be included
in the Registration Statement or the Prospectus or otherwise) shall
have been complied with to the satisfaction of the Underwriters.
(b) Subsequent to the effective date of this Agreement, there
shall not have occurred (i) any change, or any development involving
a prospective change, in or affecting the condition, financial or
otherwise, business, properties, net worth, or results of operations
of either Transaction Entity or any of their subsidiaries or any
Property not contemplated by the Prospectus, which in the
18
reasonable opinion of the Underwriters, would materially adversely
affect the market for the Notes, or (ii) any event or development
relating to or involving either Transaction Entity, or any partner,
officer, director or trustee of either Transaction Entity, which
makes any statement of a material fact made in the Prospectus untrue
or which, in the reasonable opinion of the Company and its counsel
or the Underwriters and their counsel, requires the making of any
addition to or change in the Prospectus in order to state a material
fact required by the Securities Act or any other law to be stated
therein or necessary in order to make the statements therein not
misleading, if amending or supplementing the Prospectus to reflect
such event or development would, in the reasonable opinion of the
Underwriters or their counsel, materially adversely affect the
market for the Notes.
(c) All corporate and partnership proceedings and other legal
matters incident to the authorization, form and validity of this
Agreement, the Indenture, the Notes, the Registration Statement and
the Prospectus, and all other legal matters relating to this
Agreement, the Indenture, the Notes, the Registration Statement and
the Prospectus and the transactions contemplated hereby and thereby
shall be reasonably satisfactory in all material respects to counsel
for the Underwriters, and the Transaction Entities shall have
furnished to such counsel all documents and information that they
may reasonably request to enable them to pass upon such matters.
(d) (A) Xxxxxx Xxxxx & Xxxxxxx LLP shall have furnished to the
Underwriters its written opinion, as counsel to the Transaction
Entities, addressed to the Underwriters and dated the Delivery Date,
in form and substance reasonably satisfactory to the Underwriters,
to the effect that:
(i) The Company is in good standing as a foreign trust
or corporation in those jurisdictions listed in such opinion.
(ii) The Operating Partnership is validly existing as a
limited partnership under the laws of the Commonwealth of
Pennsylvania, is duly qualified to do business as a foreign
limited partnership in Florida, Kansas, Maryland, Michigan,
Minnesota, New Jersey, North Carolina, South Carolina, Texas,
Virginia and Wisconsin, and has all partnership power and
authority necessary to own or hold its properties, to conduct
the business in which it is engaged as described in the
Registration Statement and the Prospectus, and to enter into
and perform its obligations under this Agreement. The Company
is the sole general partner of the Operating Partnership. To
the knowledge of such counsel, the Operating Partnership
Agreement is in full force and effect, and the aggregate
percentage interests of the Company and the limited partners
in the Operating Partnership are as set forth in the
Prospectus. All of the partnership interests of the Operating
Partnership have been duly and validly authorized and issued,
are fully paid and, to the knowledge of such counsel, to the
extent that such interests are owned by the Company, are
19
owned by the Company free and clear of any adverse claims as
defined in Section 8-302 of the Uniform Commercial Code.
(iii) Development Corp. is duly incorporated and
subsisting under the laws of the Commonwealth of Pennsylvania,
is duly qualified to do business and is in good standing as a
foreign corporation in Florida, Maryland, Michigan, Minnesota,
New Jersey, North Carolina, Virginia and Wisconsin, and has
all corporate power and authority necessary to own or hold its
properties and to conduct the business in which it is engaged
as described in the Registration Statement and the Prospectus.
(iv) Development-II is duly incorporated and subsisting
under the laws of the Commonwealth of Pennsylvania, is duly
qualified to do business and is in good standing as a foreign
corporation in Florida and Texas, and has all corporate power
and authority necessary to own or hold its properties and to
conduct the business in which it is engaged as described in
the Registration Statement and the Prospectus.
(v) SP Trust is validly existing as a business trust and
subsisting under the laws of the Commonwealth of Pennsylvania
and has all trust power and authority necessary to own or hold
its properties and to conduct the business in which it is
engaged as described in the Registration Statement and the
Prospectus.
(vi) This Agreement has been duly and validly
authorized, executed and delivered by the Operating
Partnership, and has been duly and validly executed and
delivered by the Company.
(vii) Each of the Indenture and the Supplemental
Indenture has been duly authorized, executed and delivered by
the Operating Partnership and (assuming due execution and
delivery by the Trustee) constitutes a valid and binding
agreement on the part of the Operating Partnership,
enforceable against the Operating Partnership in accordance
with its terms; each of the Indenture and the Supplemental
Indenture conforms in all material respects to the
descriptions thereof contained in the Prospectus.
(viii) The Notes have been duly authorized, executed and
delivered by the Operating Partnership and, assuming due
authorization, execution and delivery of the Indenture and the
authentication of the Notes by the Trustee and payment for the
Notes by the Underwriters in accordance with the terms of the
Underwriting Agreement, will constitute valid and binding
obligations of the Operating Partnership in accordance with
their terms. The terms of the Notes conform in all material
respects to the description thereof in the Prospectus.
20
(ix) To the knowledge of such counsel, the execution,
delivery and performance of this Agreement by each of the
Transaction Entities and the consummation of the transactions
contemplated hereby will not (i) conflict with or result in a
breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument that is
filed as an exhibit to the Registration Statement or to any
document incorporated by reference in the Prospectus and as to
which either of the Transaction Entities or their subsidiaries
is a party or to which any of the Properties or other assets
of either of the Transaction Entities or their subsidiaries is
subject, or (ii) conflict with or result in any violation of
the provisions of any statute or any order, rule or regulation
of any court or governmental agency or body having
jurisdiction over either of the Transaction Entities or their
subsidiaries or any of their properties or assets, except with
respect to (ii), where such conflict or violation would not
have a material adverse effect on the Transaction Entities or
their subsidiaries taken as a whole; and except for the
registration of the Notes under the Securities Act and the
qualification of the Indenture under the Trust Indenture Act
and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and
applicable state securities laws in connection with the
purchase and distribution of the Notes by the Underwriters, no
consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or
body is required for the execution, delivery and performance
of this Agreement, the Indenture or the Supplemental Indenture
by the Transaction Entities and the consummation of the
transactions contemplated hereby and thereby, and the issuance
and delivery of the Notes.
(x) The execution, delivery and performance of this
Agreement by each of the Transaction Entities and the
consummation of the transactions contemplated hereby will not
conflict with or result in any violation of the provisions of
the charter, by-laws, certificate of limited partnership or
agreement of limited partnership of either of the Transaction
Entities or their subsidiaries.
(xi) Except as set forth in the Prospectus, to the
knowledge of such counsel, there are no preemptive or other
rights to subscribe for or to purchase, nor any restriction
upon the transfer of the Notes pursuant to the Operating
Partnership's certificate of limited partnership, its
agreement of limited partnership, as amended to the date
hereof, or any agreement or other instrument to which the
Operating Partnership is a party.
(xii) To the knowledge of such counsel, other than as
set forth in the Prospectus and other than in respect of (i)
certain persons who have contributed Properties to the
Partnership in exchange for Units, (ii) persons whose
securities are already registered under the Securities Act,
and (iii) persons who may acquire preferred shares of the
Company in
21
exchange for preferred units of partnership interest in the
Operating Partnership, there are no contracts, agreements or
understandings between the Company and/or the Operating
Partnership, on the one hand, and any person, on the other
hand, granting such person the right to require the Company or
the Operating Partnership to file a registration statement
under the Securities Act with respect to any securities of the
Company or the Operating Partnership owned or to be owned by
such person or to require the Company or the Operating
Partnership to include such securities in the securities
registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration
statement filed by the Company or the Operating Partnership
under the Securities Act.
(xiii) To the knowledge of such counsel, there are no
legal or governmental proceedings pending to which either
Transaction Entity or their subsidiaries is a party or of
which any property or assets of either Transaction Entity or
their subsidiaries is the subject, that are required to be
described in the Prospectus which have not been described as
required. To the knowledge of such counsel, no such
proceedings are threatened or contemplated by governmental
authorities or threatened by others.
(xiv) To the knowledge of such counsel, there are no
contracts or other documents which are required to be
described in the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act or by the Rules
and Regulations which have not been described in the
Prospectus or filed as exhibits to the Registration Statement
or incorporated therein by reference as permitted by the Rules
and Regulations.
(xv) To the knowledge of such counsel, no consent,
approval, authorization or other order of, or registration or
filing with, any court, regulatory body, administrative agency
or other governmental body, agency, or official is required on
the part of the Company (except as have been obtained under
the Securities Act and the Exchange Act or such as may be
required under state securities or real estate syndication)
for the valid issuance and sale of the Notes to the
Underwriters as contemplated by this Agreement.
(xvi) Neither Transaction Entity nor any of their
subsidiaries is an "investment company" within the meaning of
such term under the Investment Company Act of 1940 and the
rules and regulations of the Commission thereunder.
(xvii) The documents incorporated or deemed to be
incorporated by reference in the Prospectus pursuant to Item
12 of Form S-3 under the Securities Act (other than the
financial statements and related schedules and financial
information and data included therein, as to which no
22
opinion need be rendered), at the time they were filed with
the Commission, complied and will comply as to form in all
material respects with the requirements of the Exchange Act
and the rules and regulations thereunder.
(xviii) Based solely upon the oral advice of a member of
the staff of the Securities and Exchange Commission and, to
the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued
and, to the knowledge of such counsel, no proceeding for that
purpose is pending or threatened by the Commission. The
Registration Statement was declared effective under the
Securities Act and the Indenture was duly qualified under the
Trust Indenture Act as of the date and time specified in such
opinion.
(xix) The Prospectus was filed with the Commission
pursuant to the subparagraph of Rule 424(b) of the Rules and
Regulations specified in such opinion on the date specified
therein.
(xx) The Registration Statement and the Prospectus and
any further amendments or supplements thereto made by the
Company prior to the Delivery Date (other than the financial
statements and related schedules and other financial
information and data included therein, as to which such
counsel need express no opinion) comply as to form in all
material respects with the requirements of the Securities Act
and the Trust Indenture Act and the Indenture conforms in all
material respects to the requirements of the Trust Indenture
Act.
(xxi) The statements contained in the Prospectus under
the captions "Risk Factors," "Description of Debt Securities,"
"Description of Preferred Shares," "Description of Warrants,"
and "Description of Notes," insofar as those statements are
descriptions of contracts, agreements or other legal
documents, or they describe federal statutes, rules and
regulations, and except to the extent such statements are
statistics or calculations constitute a fair summary thereof.
(xxii) The statements contained in the prospectus
supplement to the Prospectus dated January 10, 2003 under the
caption "Certain Federal Income Tax Considerations," insofar
as those statements are descriptions of contracts, agreements
or other legal documents, or they describe federal statutes,
rules and regulations, and except to the extent such
statements are statistics or calculations are correct in all
material respects. Notwithstanding any references set forth in
the prospectus supplement in the discussion under the caption
"Certain Federal Income Tax Considerations" to the discussion
in the Prospectus under the caption "Federal Income Tax
Considerations with Respect to the Company and the Operating
Partnership", in rendering the opinion required by this
paragraph, Xxxxxx, Xxxxx & Xxxxxxx LLP shall not be expressing
any
23
opinion regarding the discussion or statements contained in
the Prospectus under the caption "Federal Income Tax
Considerations with Respect to the Company and the Operating
Partnership".
In rendering such opinion, such counsel may (i) state that its
opinion is limited to matters governed by the Federal laws of the
United States of America, the laws of the Commonwealth of
Pennsylvania and the laws of the State of Maryland; (ii) as to
matters of Maryland law, state that its opinion is given solely in
reliance upon the opinion of Xxxx Xxxxx LLP; and (iii) in giving the
opinions referred to in subclause (vii) and (viii), state that such
opinion with respect to the enforceability of such documents may be
limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles.
Such counsel shall also have furnished to the Underwriters a written
statement, addressed to the Underwriters and dated the Delivery
Date, in form and substance satisfactory to the Underwriters, to the
effect that (x) such counsel has acted as counsel to the Company in
connection with the preparation of the Registration Statement and
the Prospectus, and (y) based on the foregoing, no facts have come
to the attention of such counsel which lead it to believe that the
Registration Statement, as of the Effective Date, contained any
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the
statements therein not misleading, or that the Prospectus contains
any untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading. The foregoing opinion and statement may
be qualified by a statement to the effect 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 except to the extent of the opinion contained in Section
7(d)(A)(xxii), and may state that such counsel expresses no belief
with respect to the financial statements and notes thereto and other
financial information and data included or incorporated by reference
in, or omitted from, the Registration Statement or the Prospectus or
the Statement of Eligibility on Form T-1 of the Trustee.
(B) Xxxx Xxxxx LLP shall have furnished to the Underwriters
its written opinion, as Maryland counsel to the Company, addressed
to the Underwriters and dated the Delivery Date, in form and
substance reasonably satisfactory to the Underwriters, to the effect
that:
(i) The Company has been duly formed and is validly
existing as a real estate investment trust in good standing
under and by virtue of the laws of the State of Maryland, and
has all trust power and authority necessary to own or hold its
properties and to conduct the business in which it is engaged
as described in the Registration Statement and the Prospectus,
and to enter into and perform its obligations under this
Agreement.
24
(ii) This Agreement has been duly and validly
authorized, executed and delivered by the Company, and
assuming due authorization, execution and delivery by the
Underwriters and the Operating Partnership, is a valid and
binding agreement of the Company except as limited by (a)
bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other laws relating to or affecting the
enforcement of creditors' rights or (b) general equitable
principles.
(iii) To the knowledge of such counsel, the execution,
delivery and performance of this Agreement by the Company and
the consummation of the transactions contemplated hereby will
not conflict with or result in any violation of the provisions
of any statute or any order, rule or regulation of any court
or governmental agency or body of the State of Maryland that
has jurisdiction over the Company or any of its properties or
assets.
(iv) The execution, delivery and performance of this
Agreement by the Company and the consummation of the
transactions contemplated hereby will not conflict with or
result in any violation of the provisions of the Declaration
of Trust or by-laws of the Company.
(v) To the knowledge of such counsel, there are no legal
or governmental proceedings pending to which the Company is a
party or of which any property or assets of the Company is the
subject which are not disclosed in the Prospectus and which,
if determined adversely to the Company, might reasonably be
expected to have a material adverse effect on the consolidated
financial position, shareholders' equity, results of
operations, business or prospects of the Company; and to the
best knowledge of such counsel no such proceedings are
threatened or contemplated by governmental authorities or
threatened by others.
Such counsel shall state that Clifford Chance US LLP, counsel for
the Underwriters, may rely on its opinion.
(e) (i) Wolf, Block, Xxxxxx and Xxxxx-Xxxxx LLP shall have
furnished to the Underwriters its written opinion, dated the
Delivery Date, with respect to such tax matters, including without
limitation the qualification of the Company as a real estate
investment trust and the classification of the Operating Partnership
as a partnership (and not as a corporation) for federal income tax
purposes, as the Underwriters may reasonably require.
(ii) The statements contained in the Prospectus under
the caption "Federal Income Tax Considerations with Respect to
the Trust and Operating Partnership," insofar as those
statements are descriptions of contracts, agreements or other
legal documents, or they describe federal statutes, rules and
regulations, and except to the extent such statements are
statistics or calculations are correct in all material
respects. In rendering the opinion required by this paragraph,
Wolf, Block, Xxxxxx and Xxxxx-Xxxxx LLP shall not be
expressing any opinion regarding the discussion
25
or statements contained in the prospectus supplement dated
January 10, 2003 to the Prospectus under the caption "Certain
Federal Income Tax Considerations."
(f) The Underwriters shall have received from Clifford Chance
US LLP, counsel for the Underwriters, such opinion or opinions,
dated the Delivery Date, with respect to the issuance and sale of
the Notes, the Registration Statement, the Prospectus and other
related matters as the Underwriters may reasonably require, and the
Company shall have furnished to such counsel such documents as they
reasonably request for the purpose of enabling them to pass upon
such matters.
(g) At the time of execution of this Agreement, the
Underwriters shall have received from Ernst & Young LLP a letter, in
form and substance satisfactory to the Underwriters, addressed to
the Underwriters and dated the date hereof (i) confirming that they
are independent public accountants within the meaning of the
Securities Act and are in compliance with the applicable
requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission, and (ii) stating, as of
the date hereof (or, with respect to matters involving changes or
developments since the respective dates as of which specified
financial information is given in, or incorporated by reference in,
the Prospectus, as of a date not more than five days prior to the
date hereof), the conclusions and findings of such firm with respect
to the financial information and other matters ordinarily covered by
accountants' "comfort letters" to underwriters in connection with
registered public offerings.
(h) With respect to the letter of Xxxxx & Young LLP referred
to in the preceding paragraph and delivered to the Underwriters
concurrently with the execution of this Agreement (the "initial
letter"), the Underwriters shall have received from Xxxxx & Young a
letter (the "bring-down letter"), addressed to the Underwriters and
dated the Delivery Date (i) confirming that they are independent
public accountants within the meaning of the Securities Act and are
in compliance with the applicable requirements relating to the
qualification of accountants under Rule 2-01 of Regulation S-X of
the Commission, (ii) stating, as of the date of the bring-down
letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified
financial information is given in the Prospectus, as of a date not
more than five days prior to the date of the bring-down letter), the
conclusions and findings of such firm with respect to the financial
information and other matters covered by the initial letter and
(iii) confirming in all material respects the conclusions and
findings set forth in the initial letter.
(i) The Transaction Entities shall have furnished to the
Underwriters a certificate, dated the Delivery Date, of the Chairman
of the Board, Chief Executive Officer, President or a Vice President
of the Company and the chief financial officer of the Company (in
each case, for the Company and for the Company as general partner of
the Operating Partnership) stating that:
26
(i) The representations, warranties and agreements of
the Transaction Entities in Section 1 are true and correct as
of the Delivery Date; the Transaction Entities complied with
all of their agreements contained herein; and the conditions
set forth in Sections 7(a) and 7(i) have been fulfilled; and
(ii) They have carefully examined the Registration
Statement and the Prospectus and, in their opinion (A) as of
the Effective Date, the Registration Statement and Prospectus
did not include any untrue statement of a material fact and
did not omit to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading (with respect to the Prospectus, in light of the
circumstances in which they were made), and (B) since the
Effective Date no event has occurred which should have been
set forth in a supplement or amendment to the Registration
Statement or the Prospectus.
(j) (i) None of the Transaction Entities or their subsidiaries
or any Property shall have sustained since the date of the latest
audited financial statements included in the Prospectus any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus or (ii) since
such date there shall not have been any change in the capital stock
or long-term debt of either Transaction Entity or any change, or any
development involving a prospective change, in or affecting any
Property Affiliate or Property or the general affairs, management,
financial position, shareholders' equity or results of operations of
either Transaction Entity, otherwise than as set forth or
contemplated in the Prospectus, the effect of which, in any such
case described in clause (i) or (ii), is, in the judgment of the
Underwriters, so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of
the Notes being delivered on the Delivery Date on the terms and in
the manner contemplated in the Prospectus.
(k) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange or the American
Stock Exchange or in the over-the-counter market, or trading in any
securities of the Company on any exchange or in the over-the-counter
market, shall have been suspended or minimum prices shall have been
established on any such exchange or such market by the Commission,
by such exchange or by any other regulatory body or governmental
authority having jurisdiction, (ii) a banking moratorium shall have
been declared by Federal or state authorities or there shall have
occurred a material disruption in commercial banking or securities
settlement or clearance services in the United States, (iii) the
United States shall have become engaged in hostilities, there shall
have been an escalation in hostilities involving the United States
or there shall have been a declaration of a national emergency or
war by the United States or (iv) there shall have occurred any other
calamity or crisis in the United States or
27
elsewhere resulting in a material disruption in the financial
markets in the United States or there shall have occurred such a
material adverse change in general economic, political or financial
conditions (or the effect of international conditions on the
financial markets in the United States shall be such) as to make it,
in the judgment of a majority in interest of the several
Underwriters, impracticable or inadvisable to proceed with the
public offering or delivery of the Notes being delivered on the
Delivery Date on the terms and in the manner contemplated in the
Prospectus.
(l) Subsequent to the execution and delivery of this Agreement
(i) no downgrading shall have occurred in the rating accorded the
Operating Partnership's debt securities by any "nationally
recognized statistical rating organization," as that term is defined
by the Commission for purposes of Rule 436(g)(2) of the Rules and
Regulations and (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible
negative implications, its rating of any of the Operating
Partnership's debt securities.
(m) The Transaction Entities shall not have failed at or prior
to the Delivery Date to have performed or complied with any of their
agreements herein contained and required to be performed or complied
with by them hereunder at or prior to the Delivery Date.
(n) On the Delivery Date, counsel for the Underwriters shall
have been furnished with such documents and opinions as they may
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
Transaction Entities in connection with the issuance and sale of the
Notes as herein contemplated shall be satisfactory in form and
substance to the Underwriters and counsel for the Underwriters.
(o) The Operating Partnership shall have furnished or caused
to be furnished to the Underwriters such further certificates and
documents as the Underwriters shall have reasonably requested.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
Any certificate or document signed by any officer of the Transaction
Entities and delivered to the Underwriters, or to counsel for the Underwriters,
shall be deemed a representation and warranty by the Transaction Entities to
each Underwriter as to the statements made therein.
8. Effective Date of Agreement. This Agreement shall become
effective: (i) upon the execution hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed
28
and delivered, it is necessary for the Registration Statement or a
post-effective amendment thereto to be declared effective before the offering of
the Notes may commence, when notification of the effectiveness of the
Registration Statement or such post-effective amendment has been released by the
Commission.
9. Default by One or More of the Underwriters. If, on the Delivery
Date, any Underwriter defaults in the performance of its obligations under this
Agreement, the remaining non-defaulting Underwriters shall be obligated to
purchase the Notes which the defaulting Underwriter agreed but failed to
purchase on the Delivery Date in the respective proportions which the principal
amount of Notes set forth opposite the name of each remaining non-defaulting
Underwriter in Schedule I hereto bears to the total aggregate principal amount
of Notes set forth opposite the names of all the remaining non-defaulting
Underwriters in Schedule I hereto; provided, however, that the remaining
non-defaulting Underwriters shall not be obligated to purchase any of the Notes
on the Delivery Date if the total aggregate principal amount of Notes which the
defaulting Underwriter or Underwriters agreed but failed to purchase on such
date exceeds 9.09% of the total aggregate principal amount of Notes to be
purchased on the Delivery Date, and any remaining non-defaulting Underwriter
shall not be obligated to purchase more than 110% of the aggregate principal
amount of Notes which it agreed to purchase on the Delivery Date pursuant to the
terms of Section 2. If the foregoing maximums are exceeded, the remaining
non-defaulting Underwriters, or those other underwriters satisfactory to the
Underwriters who so agree, shall have the right, but shall not be obligated, to
purchase, in such proportion as may be agreed upon among them, all the Notes to
be purchased on the Delivery Date. If the remaining Underwriters or other
underwriters satisfactory to the Underwriters do not elect to purchase the Notes
which the defaulting Underwriter or Underwriters agreed but failed to purchase
on the Delivery Date, this Agreement shall terminate without liability on the
part of any non-defaulting Underwriter or the Transaction Entities, except that
the Transaction Entities will continue to be liable for the payment of expenses
to the extent set forth in Sections 6 and 12. As used in this Agreement, the
term "Underwriter" includes, for all purposes of this Agreement unless the
context requires otherwise, any party not listed in Schedule I hereto who,
pursuant to this Section 9, purchases Notes which a defaulting Underwriter
agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of
any liability it may have to the Transaction Entities for damages caused by its
default. If other underwriters are obligated or agree to purchase the Notes of a
defaulting or withdrawing Underwriter, either the Underwriters or the Company
may postpone the Delivery Date for up to seven full business days in order to
effect any changes that in the opinion of counsel for the Operating Partnership
or counsel for the Underwriters may be necessary in the Registration Statement,
the Prospectus or in any other document or arrangement.
10. Indemnification and Contribution.
(a) The Transaction Entities jointly and severally, shall
indemnify and hold harmless each Underwriter, its officers and
employees and each person, if any, who controls any Underwriter
within the meaning of the Securities Act, from and against any loss,
claim, damage or liability, joint or several, or any action in
respect thereof (including, but not limited to, any loss, claim,
damage, liability or
29
action relating to purchases and sales of Notes), to which that
Underwriter, officer, employee or controlling person may become
subject, under the Securities Act or otherwise, insofar as such
loss, claim, damage, liability or action arises out of, or is based
upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus or in any amendment or
supplement thereto, (ii) the omission or alleged omission to state
in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any amendment or supplement thereto, any material
fact required to be stated therein or necessary to make the
statements therein not misleading (with respect to the Prospectus,
in light of the circumstances under which they were made), or (iii)
any act or failure to act or any alleged act or failure to act by
any Underwriter in connection with, or relating in any manner to,
the Notes or the offering contemplated hereby, and which is included
as part of or referred to in any loss, claim, damage, liability or
action arising out of or based upon matters covered by clause (i) or
(ii) above (provided that the Transaction Entities shall not be
liable under this clause (iii) to the extent that it is determined
in a final judgment by a court of competent jurisdiction that such
loss, claim, damage, liability or action resulted directly from any
such acts or failures to act undertaken or omitted to be taken by
such Underwriter through its gross negligence or willful
misconduct), and shall reimburse each Underwriter and each such
officer, employee or controlling person for any legal or other
expenses reasonably incurred by that Underwriter, officer, employee
or controlling person in connection with investigating or defending
or preparing to defend against any such loss, claim, damage,
liability or action as such expenses are incurred; provided,
however, that the Transaction Entities shall not be liable in any
such case to the extent that any such loss, claim, damage, liability
or action arises out of, or is based upon, any untrue statement or
alleged untrue statement or omission or alleged omission made in any
Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any such amendment or supplement, in reliance upon
and in conformity with written information concerning such
Underwriter furnished to the Transaction Entities through the
Underwriters by or on behalf of any Underwriter specifically for
inclusion therein; provided further, that the Transaction Entities
shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or action to or by any person arises
out of, or is based upon, any untrue statement or omission of
material fact made in any prospectus, to the extent that any such
loss, claim, damage or liability or action to or by such person
results from the fact that (i) the Company had previously furnished
copies of the Prospectus to the Underwriters, (ii) delivery of the
Prospectus was required by the Securities Act to be made to such
person, (iii) the untrue statement or omission of a material fact
contained in the prospectus was corrected in the Prospectus, (iv)
there was not sent or given to such person, at or prior to the
written confirmation of the sale of such securities to such person,
a copy of the Prospectus and (v) such correction would have cured
the defect giving rise to such loss, damage or liability. The
foregoing indemnity agreement is in addition to any liability which
the Transaction Entities may
30
otherwise have to any Underwriter or to any officer, employee or
controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall
indemnify and hold harmless each Transaction Entity, its officers
and employees, each of its trustees, and each person, if any, who
controls each Transaction Entity within the meaning of the
Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to
which each Transaction Entity or any such trustee, officer or
controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement or the Prospectus or in any
amendment or supplement thereto, or (ii) the omission or alleged
omission to state in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or in any amendment or supplement
thereto any material fact required to be stated therein or necessary
to make the statements therein not misleading, but in each case only
to the extent that the untrue statement or alleged untrue statement
or omission or alleged omission was made in reliance upon and in
conformity with written information concerning such Underwriter
furnished to the Transaction Entities through the Underwriters by or
on behalf of that Underwriter specifically for inclusion therein,
and shall reimburse each Transaction Entity and any such trustee,
officer or controlling person for any legal or other expenses
reasonably incurred by each Transaction Entity or any such trustee,
officer or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability which
any Underwriter may otherwise have to each Transaction Entity or any
such trustee, officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 10 of notice of any claim or the commencement of any action,
the indemnified party shall, if a claim in respect thereof is to be
made against the indemnifying party under this Section 10, notify
the indemnifying party in writing of the claim or the commencement
of that action; provided, however, that the failure to notify the
indemnifying party shall not relieve it from any liability which it
may have under this Section 10 except to the extent it has been
materially prejudiced by such failure and, provided further, that
the failure to notify the indemnifying party shall not relieve it
from any liability which it may have to an indemnified party
otherwise than under this Section 10. If any such claim or action
shall be brought against an indemnified party, and it shall notify
the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes,
jointly with any other similarly notified indemnifying party, to
assume the defense thereof with counsel reasonably satisfactory to
the indemnified party. After notice from the indemnifying party to
the indemnified party of its election to assume the defense of such
claim or action, the indemnifying party shall not be liable to the
indemnified party under this Section
31
10 for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, that the
indemnified party shall have the right to employ its own counsel,
with such counsel, in the case of the Underwriters, to represent
jointly the Underwriters and their respective officers, employees
and controlling persons who may be subject to liability arising out
of any claim in respect of which indemnity may be sought by the
Underwriters against the Transaction Entities under this Section 10
if, in the reasonable judgment of the Underwriters, it is advisable
for the Underwriters and those officers, employees and controlling
persons to be jointly represented by separate counsel, and in that
event the fees and expenses of such separate counsel shall be paid
by the Transaction Entities. No indemnifying party shall (i) without
the prior written consent of the indemnified parties (which consent
shall not be unreasonably withheld), settle or compromise or consent
to the entry of any judgment with respect to any pending or
threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or
not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding, or
(ii) be liable for any settlement of any such action effected
without its written consent (which consent shall not be unreasonably
withheld), but if settled with the consent of the indemnifying party
or if there be a final judgment of the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any
indemnified party from and against any loss or liability by reason
of such settlement or judgment.
(d) If the indemnification provided for in this Section 10
shall for any reason be unavailable to or insufficient to hold
harmless an indemnified party under Section 10(a) or 10(c) in
respect of any loss, claim, damage or liability, or any action in
respect thereof, referred to therein, then each indemnifying party
shall, in lieu of indemnifying such indemnified party, contribute to
the amount paid or payable by such indemnified party as a result of
such loss, claim, damage or liability, or action in respect thereof,
(i) in such proportion as shall be appropriate to reflect the
relative benefits received by the Transaction Entities on the one
hand and the Underwriters on the other from the offering of the
Notes or (ii) 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 Transaction Entities, on
the one hand, and the Underwriters, on the other hand, with respect
to the statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative benefits
received by the Transaction Entities, on the one hand, and the
Underwriters, on the other hand, with respect to such offering shall
be deemed to be in the same proportion as the total net proceeds
from the offering of the Notes purchased under this Agreement
(before deducting expenses) received by the Transaction Entities, on
the one hand, and the total underwriting discounts and commissions
received by the Underwriters with
32
respect to the Notes purchased under this Agreement, on the other
hand, bear to the total gross proceeds from the offering of the
Notes under this Agreement, in each case as set forth in the table
on the cover page of the Prospectus. The relative fault shall be
determined by reference to whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the
Transaction Entities or the Underwriters, the intent of the parties
and their relative knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Transaction
Entities and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this Section were to be
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 into account the equitable
considerations referred to herein. The amount paid or payable by an
indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this
Section shall be deemed to include, for purposes of this Section
10(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section
10(d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Notes
underwritten by it and distributed to the public was offered to the
public exceeds the amount of any damages which such Underwriter has
otherwise paid or become liable to pay by reason of any 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 Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as
provided in this Section 10(d) are several in proportion to their
respective underwriting obligations and not joint.
(e) The Underwriters severally confirm that the statements on
pages S-15 and S-16 of the prospectus supplement to the Prospectus
dated January 10, 2003: (i) with respect to the concession and
reallowance figures in the fourth paragraph and (ii) in the seventh,
eighth and ninth paragraphs, are correct and each Transaction Entity
acknowledges that these statements constitute, except as provided in
the following sentence, the only information concerning such
Underwriters furnished in writing to the Transaction Entities by or
on behalf of the Underwriters specifically for inclusion in the
Registration Statement, the Preliminary Prospectus, if any, and the
Prospectus. CSFB confirms that the statements on page S-16 of the
prospectus supplement to the Prospectus dated January 10, 2003 in
the twelfth paragraph are correct.
11. Termination. The obligations of the Underwriters hereunder may
be terminated by the Underwriters by notice given to and received by the
Operating Partnership prior to delivery of and payment for the Notes if, prior
to that time, any of the events described in Sections 7(i), 7(j), 7(k), 7(l) or
7(m), shall have occurred or if the Underwriters shall decline to purchase the
Notes for any reason permitted under this Agreement.
33
12. Reimbursement of Underwriters' Expenses. If the Operating
Partnership shall fail to tender the Notes for delivery to the Underwriters by
reason of any failure, refusal or inability on the part of the Transaction
Entities to perform any agreement on their part to be performed, or because any
other condition of the Underwriters' obligations hereunder required to be
fulfilled by the Transaction Entities is not fulfilled, the Transaction Entities
will reimburse the Underwriters for all reasonable out-of-pocket expenses
(including fees and disbursements of counsel) incurred by the Underwriters in
connection with this Agreement and the proposed purchase of the Notes, and upon
demand the Transaction Entities shall pay the full amount thereof to the
Underwriters. If this Agreement is terminated pursuant to Section 9 by reason of
the default of one or more Underwriters, the Transaction Entities shall not be
obligated to reimburse any defaulting Underwriter on account of those expenses.
13. Representation of CSFB. CSFB represents to the Operating
Partnership that, on the Delivery Date, CSFB will deliver the Exchange Notes to
the Operating Partnership free and clear of any pledge, lien, security interest,
encumbrance or claim that CSFB created, permitted or imposed on the Exchange
Notes; and to the knowledge of CSFB, the Exchange Notes to be delivered by CSFB
pursuant to this Agreement were at the time acquired by CSFB free of any
pledges, liens, security interests, encumbrances or claims; and CSFB has full
power and authority to effect the delivery of the Exchange Notes as contemplated
by this Agreement. CSFB has not acted and is not acting as agent for the
Operating Partnership in its acquisition of the Exchange Notes.
14. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by
mail, telex or facsimile transmission to Credit Suisse First Boston
Corporation, Xxxxxx Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Transactions Advisory Group;
(b) if to the Transaction Entities shall be delivered or sent
by mail, telex or facsimile transmission to the Company, 00 Xxxxxx
Xxxxxx Xxxxxxx, Xxxxxxx, XX 00000, Attention: General Counsel (Fax:
000-000-0000);
provided, however, that any notice to an Underwriter pursuant to Section 10(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Underwriters, which address will be supplied to any other party hereto by the
Underwriters upon request. Any such statements, requests, notices or agreements
shall take effect at the time of receipt thereof.
15. Persons Entitled to Benefit of Agreement. This Agreement shall
inure to the benefit of and be binding upon the Underwriters, the Transaction
Entities and their respective personal representatives and successors. This
Agreement and the terms and provisions hereof are for the sole benefit of only
those persons, except that (A) the representations, warranties, indemnities and
agreements of the Transaction Entities contained in this Agreement shall also be
deemed to be for the benefit of the person or persons, if any, who control any
Underwriter within the meaning of Section 15 of the Securities Act and (B) the
indemnity agreement of the Underwriters contained in Section 10(b) of this
Agreement shall be deemed to be for the benefit of trustees of the Company,
officers of the Company who have signed the Registration Statement
34
and any person controlling the Transaction Entities within the meaning of
section 15 of the Securities Act. Nothing in this Agreement is intended or shall
be construed to give any person, other than the persons referred to in this
Section 15, any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision contained herein.
16. Survival. The respective indemnities, representations,
warranties and agreements of the Transaction Entities and the Underwriters
contained in this Agreement or made by or on behalf on them, respectively,
pursuant to this Agreement, shall survive the delivery of and payment for the
Notes and shall remain in full force and effect, regardless of any investigation
made by or on behalf of any of them or any person controlling any of them.
17. Definition of the Terms "Business Day" and "Subsidiary". For
purposes of this Agreement, (a) "business day" means any day on which the New
York Stock Exchange, Inc. is open for trading and (b) "subsidiary" has the
meaning set forth in Rule 405 of the Rules and Regulations.
18. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of New York.
19. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
20. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
35
If the foregoing correctly sets forth the agreement between the
Company and the Underwriters, please indicate your acceptance in the space
provided for that purpose below.
Very truly yours,
LIBERTY PROPERTY TRUST
By /s/ Xxxxxx X. Xxxxxxxx, Xx.
Name: Xxxxxx X. Xxxxxxxx, Xx.
Title: Executive Vice President and Chief
Financial Officer
LIBERTY PROPERTY LIMITED PARTNERSHIP
By: Liberty Property Trust, its general
partner
By: /s/ Xxxxxx X. Xxxxxxxx, Xx.
Name: Xxxxxx X. Xxxxxxxx, Xx.
Title: Executive Vice President and
Chief Financial Officer
Accepted:
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ Xxxx Xxxxxxxx
Name: Xxxx Xxxxxxxx
Title: Director
UBS WARBURG LLC
By: /s/ Xxxxxx Xxxxx
Name: Xxxxxx Xxxxx
Title: Executive Director
By: /s/ Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: Associate Director
36
SCHEDULE I
UNDERWRITERS PRINCIPAL AMOUNT OF NOTES
------------ -------------------------
Credit Suisse First Boston Corporation $42,500,000
UBS Warburg LLC $42,500,000
-----------
$85,000,000
===========
37
SCHEDULE II
Senior Notes Due 2012
Principal Amount $85,000,000
Coupon: 6.375%
Settlement Date: January 15, 2003
Price to Public: 102.829%
Price to Public: $87,404,650
Underwriting Discount: 0.650%
Underwriting Discount: $552,500
Price to Company: 102.179%
Proceeds to the Company (before expenses) $86,852,150, such Purchase Price to
be paid by the Underwriters as set forth in Sections 2 and 4 of this Agreement
Maturity Date: August 15, 2012
Reopened Series: $150,000,000 of the Operating Partnership's Senior Notes 2012
were issued on August 22, 2002.
38
SCHEDULE III
Florida, Kansas, Maryland, Michigan, Minnesota, New Jersey, North Carolina,
South Carolina, Texas, Virginia and Wisconsin.
39
