SENIOR HOUSING PROPERTIES TRUST
15,000,000 Shares of Beneficial Interest
UNDERWRITING AGREEMENT
February 15, 2002
UNDERWRITING AGREEMENT
February 15, 2002
UBS Warburg LLC
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
X.X. Xxxxxxx & Sons, Inc.
First Union Securities, Inc.
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated
Xxxxxxx Xxxxx & Associates, Inc.
RBC Xxxx Xxxxxxxx Inc.
c/o UBS Warburg LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
Senior Housing Properties Trust, a real estate investment
trust organized under the laws of the State of Maryland (the "COMPANY"),
proposes to issue and sell to the underwriters named in SCHEDULE A annexed
hereto (the "UNDERWRITERS") an aggregate of 15,000,000 common shares (the "FIRM
SHARES") of beneficial interest, $0.01 par value (the "COMMON SHARES"), of the
Company. In addition, solely for the purpose of covering over-allotments, the
Company proposes to grant to the Underwriters the option to purchase from the
Company up to an additional 2,250,000 Common Shares (the "ADDITIONAL SHARES").
The Firm Shares and the Additional Shares are hereinafter collectively sometimes
referred to as the "SHARES." The Shares are described in the Prospectus which is
referred to below.
The Company has prepared and filed with the Securities and
Exchange Commission (the "COMMISSION") in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "ACT"), a registration statement (file
number 333-76588) on Form S-3 under the Act (the "REGISTRATION STATEMENT"),
including a prospectus relating to, among other things, common shares of
beneficial interest, preferred shares of beneficial interest, depository shares,
guarantees, debt securities and warrants for such securities of the Company, and
such amendments to such registration statement, as may have been required prior
to the date hereof, have been similarly prepared and have been filed with the
Commission. Such registration statement, as so amended, and any post-effective
amendments thereto, have been declared by the Commission to be effective under
the Act. Such registration statement, as amended at the date of this Agreement,
meets the requirements set forth in Rule 415(a)(1)(x) under the Act and complies
in all other material respects with said Rule. The Company will next file with
the Commission pursuant to Rule 424(b) under the Act a final prospectus
supplement to the basic prospectus included in such
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registration statement, as so amended, describing the Shares and the offering
thereof, in such form as has been provided to or discussed with, and approved,
by the Underwriters.
The term "REGISTRATION STATEMENT" as used in this Agreement
means the registration statement, as amended at the time it became effective, as
supplemented or amended prior to the execution of this Agreement, including (i)
all financial schedules and exhibits thereto and (ii) all documents incorporated
by reference or deemed to be incorporated by reference therein. If it is
contemplated, at the time this Agreement is executed, that a post-effective
amendment to the registration statement will be filed and must be declared
effective before the offering of the Shares may commence, the term "Registration
Statement" as used in this Agreement means the registration statement as amended
by said post-effective amendment. If an abbreviated registration statement is
prepared and filed with the Commission in accordance with Rule 462(b) under the
Act (an "ABBREVIATED REGISTRATION STATEMENT"), the term "Registration Statement"
includes the Abbreviated Registration Statement. The term "BASIC PROSPECTUS" as
used in this Agreement means the base prospectus dated January 30, 2002, as will
be filed with the Commission pursuant to Rule 424(b) and included in the
Registration Statement. The term "PREPRICING PROSPECTUS" as used in this
Agreement means the preliminary form of the Prospectus Supplement (as defined
herein) subject to completion, if any, used in connection with the offering of
the Shares. The term "PROSPECTUS SUPPLEMENT" as used in this Agreement means any
final prospectus supplement specifically relating to the Shares, in the form
filed with, or transmitted for filing to, the Commission pursuant to Rule 424
under the Act. The term "PROSPECTUS" as used in this Agreement means the Basic
Prospectus together with the Prospectus Supplement, except that if such Basic
Prospectus is amended or supplemented on or prior to the date on which the
Prospectus Supplement was first filed pursuant to Rule 424, the term
"PROSPECTUS" shall refer to the Basic Prospectus as so amended or supplemented
and as supplemented by the Prospectus Supplement. Any reference in this
Agreement to the registration statement, the Registration Statement, the Basic
Prospectus, any Prepricing Prospectus, any Prospectus Supplement or the
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Act, as of the date
of the registration statement, the Registration Statement, the Basic Prospectus,
such Prepricing Prospectus, such Prospectus Supplement or the Prospectus, as the
case may be, and any reference to any amendment or supplement to the
registration statement, the Registration Statement, the Basic Prospectus, any
Prepricing Prospectus, any Prospectus Supplement or the Prospectus shall be
deemed to refer to and include any documents filed after such date under the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), which, upon
filing, are incorporated by reference therein, as required by paragraph (b) of
Item 12 of Form S-3. As used herein, the term "INCORPORATED DOCUMENTS" means the
documents which are incorporated by reference in the registration statement, the
Registration Statement, the Basic Prospectus, any Prepricing Prospectus, any
Prospectus Supplement, the Prospectus, or any amendment or supplement thereto.
The Company and the Underwriters agree as follows:
1. SALE AND PURCHASE. On the basis of the representations and
warranties herein and subject to the terms and conditions herein set forth, the
Company agrees to issue and sell to each Underwriter and, upon the basis of the
representations, warranties and agreements of the Company herein contained and
subject to all the terms and conditions set forth herein, each
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Underwriter agrees, severally and not jointly, to purchase from the Company, at
a purchase price of $13.034 per Share (the "PURCHASE PRICE PER SHARE"), the
number of Firm Shares set forth opposite the name of such Underwriter in
SCHEDULE A annexed hereto (or such number of Firm Shares increased as set forth
in Section 8 hereof).
The Company is advised by you that the Underwriters intend (i)
to make a public offering of their respective portions of the Firm Shares as
soon after the date hereof as in your judgment is advisable and (ii) initially
to offer the Firm Shares upon the terms set forth in the Prospectus. You may
from time to time increase or decrease the public offering price after the
initial public offering to such extent as you may determine.
In addition, the Company hereby grants to the several
Underwriters the option to purchase, and upon the basis of the representations,
warranties and agreements of the Company and subject to all the terms and
conditions herein set forth, the Underwriters shall have the right to purchase,
severally and not jointly, from the Company, ratably in accordance with the
number of Firm Shares to be purchased by each of them (subject to such
adjustment as you shall determine to avoid fractional shares), all or a portion
of the Additional Shares as may be necessary to cover over-allotments made in
connection with the offering of the Firm Shares, at the same purchase price per
share to be paid by the Underwriters to the Company for the Firm Shares. This
option may be exercised by you on behalf of the several Underwriters at any time
on or before the thirtieth day following the date hereof, by written notice to
the Company. Such notice shall set forth the aggregate number of Additional
Shares as to which the option is being exercised, and the date and time when the
Additional Shares are to be delivered (such date and time being herein referred
to as the "ADDITIONAL TIME OF PURCHASE"); PROVIDED, HOWEVER, that the additional
time of purchase shall not be earlier than the time of purchase (as defined
below) nor earlier than the second business day(1) after the date on which the
option shall have been exercised nor later than the tenth business day after the
date on which the option shall have been exercised. The number of Additional
Shares to be sold to each Underwriter shall be the number which bears the same
proportion to the aggregate number of Additional Shares being purchased as the
number of Firm Shares set forth opposite the name of such Underwriter on
SCHEDULE A hereto bears to the total number of Firm Shares (subject, in each
case, to such adjustment as you may determine to eliminate fractional shares).
2. PAYMENT AND DELIVERY. Payment of the purchase price for the
Firm Shares shall be made to the Company by Federal Funds wire transfer, against
delivery of the certificates for the Firm Shares to you through the facilities
of the Depository Trust Company ("DTC") for the respective accounts of the
Underwriters. Such payment and delivery shall be made at 10:00 A.M., New York
City time, on February 21, 2002 (unless another time shall be agreed to by you
or unless postponed in accordance with the provisions of Section 8 hereof). The
time at which such payment and delivery are actually made is hereinafter
sometimes called the "TIME OF PURCHASE." Certificates for the Firm Shares shall
be delivered to you in definitive form in such
-----------------
(1) As used herein "BUSINESS DAY" shall mean a day on which the New York
Stock Exchange is open for trading.
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names and in such denominations as you shall specify no later than the second
business day preceding the time of purchase. For the purpose of expediting the
checking of the certificates for the Firm Shares by you, the Company agrees to
make such certificates available to you for such purpose at least one full
business day preceding the time of purchase.
Payment of the purchase price for the Additional Shares shall
be made at the additional time of purchase in the same manner and at the same
office as the payment for the Firm Shares. Certificates for the Additional
Shares shall be delivered to you in definitive form in such names and in such
denominations as you shall specify no later than the second business day
preceding the additional time of purchase. For the purpose of expediting the
checking of the certificates for the Additional Shares by you, the Company
agrees to make such certificates available to you for such purpose at least one
full business day preceding the additional time of purchase.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to each of the Underwriters that:
(a) No order preventing or suspending the use of the Basic
Prospectus, any Prepricing Prospectus, the Prospectus Supplement or the
Prospectus is in effect and no proceedings for such purpose are pending
or, to the knowledge of the Company, threatened by the Commission or
the securities authority of any state or other jurisdiction. The
Registration Statement has become effective under the Act; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or, to
the knowledge of the Company, threatened by the Commission or the
securities authority of any state or other jurisdiction.
(b) (i) The Company is eligible to use Form S-3 and the
offering of the Shares complies with the requirements of Rule 415, (ii)
each part of the Registration Statement, when such part became
effective, and also any Abbreviated Registration Statement when it
shall become effective, complied in all material respects with
applicable requirements of the Act and the Exchange Act, (iii) each
part of the Registration Statement, when such part became effective,
did not contain and each such part, as may be amended or supplemented,
if applicable, will not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (iv) the
Registration Statement, any Abbreviated Registration Statement, the
Basic Prospectus, any Prepricing Prospectus, the Prospectus Supplement
and the Prospectus comply and, as may be amended or supplemented, if
applicable, will comply in all material respects with the Act and the
Exchange Act and (v) the Prospectus does not contain and, as may be
amended or supplemented, if applicable, will not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, except that the representations
and warranties set forth in this paragraph (b) do not apply to
statements or omissions in the Registration Statement, the Basic
Prospectus, any Prepricing Prospectus, the Prospectus Supplement or the
Prospectus based upon information relating to any Underwriter furnished
to the Company by such Underwriter through you expressly for use
therein.
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(c) The Incorporated Documents, when they were filed with the
Commission, conformed in all material respects to the requirements of
the Exchange Act, and none of such documents, when they were filed with
the Commission, contained an untrue statement of a material fact or
omitted to state a material fact necessary to make the statements
therein not misleading; and any further documents so filed and
incorporated by reference in (i) the Registration Statement, when such
documents are filed with the Commission, will conform in all material
respects to the requirements of the Exchange Act, as applicable, and
will not contain an untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein not
misleading, and (ii) the Prospectus, when such documents are filed with
the Commission, will conform in all material respects to the
requirements of the Exchange Act, as applicable, and will not contain
an untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances in which they were made, not misleading.
(d) As of the date of this Agreement, the Company has and will
have an authorized capitalization as set forth in the Prospectus; all
of the issued and outstanding Common Shares of the Company have been
duly and validly authorized and issued and are fully paid and
non-assessable, have been issued in compliance with all federal and
state securities laws and were not issued in violation of any
preemptive or similar right.
(e) The Company has been duly formed and is existing as a real
estate investment trust in good standing under the laws of the State of
Maryland, with trust power to own, lease and operate its properties and
conduct its business as described in the Registration Statement.
(f) The Company is duly qualified and is in good standing in
each jurisdiction in which the ownership or leasing of its properties
or the conduct of its business requires such qualification, except
where the failure to so qualify in any such jurisdiction would not
individually or in the aggregate have a material adverse effect on the
business, prospects, properties, condition (financial or otherwise) or
results of operations of the Company and the Subsidiaries (as defined
herein), taken as a whole (a "MATERIAL ADVERSE EFFECT").
(g) The Company has no subsidiaries (as defined in the Act)
other than those identified in SCHEDULE B hereto (collectively, the
"SUBSIDIARIES"). Other than the Subsidiaries, the Company does not own,
directly or indirectly, any shares of stock or any other equity or
long-term debt of any other corporation or have any direct or indirect
equity interest or ownership of long-term debt in any firm,
partnership, joint venture, limited liability company, association or
other entity except for the Company's ownership of 1,000,000 common
shares of HRPT Properties Trust, 35,000 common shares of Five Star
Quality Care, Inc. and 100 common shares of Marriott International,
Inc. The Subsidiaries identified in SCHEDULE C attached hereto (each a
"MATERIAL SUBSIDIARY") are the only Subsidiaries that are Significant
Subsidiaries (as such term is defined by Rule 1-02(w) of Regulation
S-X) of the Company. Each Subsidiary has been duly incorporated or
formed and is validly existing as a corporation or other entity, as the
case may be, in good standing under the laws of the jurisdiction of its
incorporation or organization, with the
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requisite corporate, trust, partnership or other power to acquire and
own, lease and operate its properties and to conduct its business, as
described in the Registration Statement and the Prospectus; and each
Subsidiary is duly qualified and in good standing to do business in
each jurisdiction in which the nature of its business or the ownership
or leasing of the property requires such qualification, except where
the failure to be so qualified would not have a Material Adverse
Effect.
(h) This Agreement has been duly authorized, executed and
delivered by the Company.
(i) The shares of beneficial interest of the Company,
including the Shares, conform in all material respects to the
description thereof included or incorporated by reference in the
Registration Statement and the Prospectus. The certificates evidencing
the Shares are in due and proper form and conform in all material
respects to the requirements of the Maryland REIT Law.
(j) The Shares have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will
be duly and validly issued, fully paid and non-assessable and free of
any preemptive or similar rights.
(k) Neither the Company nor any of the Subsidiaries is in
breach or violation of, or in default under (and no event has occurred
which with notice, lapse of time, or both would result in any breach or
violation of, or constitute a default under), (i) its Declaration of
Trust, charter or by-laws or other organizational documents, (ii) any
obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which the Company or any Subsidiary is subject or by
which any of them or any of their properties is bound or affected or
(iii) any order, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company or any of its or its
Subsidiaries' properties, except, in the case of clauses (ii) and
(iii), for those breaches, violations or defaults which, individually
or in the aggregate, would not have a Material Adverse Effect.
(l) Except as would not individually or in the aggregate have
a Material Adverse Effect, the issuance by the Company of the Shares,
the compliance by the Company with all of the provisions of this
Agreement, the execution, delivery and performance by the Company of
this Agreement, and the consummation of the transactions contemplated
herein 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 the Company or any Subsidiary is a party or by
which the Company or any Subsidiary is bound or to which any of the
property or assets of the Company or any Subsidiary is subject. In
addition, such action will not result in any violation of the
provisions of the Declaration of Trust or the bylaws of the Company or
any Subsidiary or any of the Company's or any Subsidiary's other
organizational documents or applicable laws or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its or its Subsidiaries'
properties.
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(m) No approval, authorization, consent or order of or filing
with any federal, state or local or foreign governmental or regulatory
commission, board, body, authority or agency is required in connection
with the issuance and sale of the Shares or the consummation by the
Company of the transaction as contemplated hereby other than
registration of the Shares under the Act and any necessary
qualification under the securities or blue sky laws of the various
jurisdictions in which the Shares are being offered by the
Underwriters.
(n) No person has the right, contractual or otherwise, to
cause the Company to issue to it, or register pursuant to the Act, any
shares of beneficial interest or other equity interests. No person has
preemptive rights, co-sale rights, rights of first refusal or other
rights to purchase any Common Shares. No person has the right,
contractual or otherwise, to cause the Company to register under the
Act any shares of beneficial interest or other equity interests as a
result of the filing or effectiveness of the Registration Statement or
the sale of Shares contemplated thereby, except for such rights as have
been complied with or waived.
(o) Ernst & Young LLP, whose report on the consolidated
financial statements of the Company and the Subsidiaries was filed with
the Commission as part of the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 2000 and is incorporated by
reference in the Registration Statement and Prospectus, are independent
public accountants as required by the Act.
(p) KPMG LLP, whose report on the financial statements with
respect to 42 nursing home facilities was filed with the Commission as
part of the Company's Current Report on Form 8-K/A and is incorporated
by reference in the Registration Statement and Prospectus, are
independent public accountants as required by the Act.
(q) Xxxxxx Xxxxxxxx LLP, whose report on the financial
statements with respect to 31 facilities ("CRESTLINE FACILITIES")
acquired by the Company pursuant to a Stock Purchase Agreement, dated
August 9, 2001, as amended, among the Company, SNH/CSL Properties
Trust, Crestline Capital Corporation and CSL Group, Inc. was filed with
the Commission as part of the Company's Current Report on Form 8-K,
dated September 21, 2001 (the "SEPTEMBER 21, 2001 8-K"), and is
incorporated by reference in the Registration Statement and Prospectus,
are independent public accountants as required by the Act.
(r) All legal or governmental proceedings, contracts, leases
or documents of a character required to be described in the
Registration Statement or the Prospectus or any Incorporated Document,
and all documents required to be filed as an exhibit to the
Registration Statement or any Incorporated Document, have been so
described or filed or will be filed prior to the time of purchase as
required.
(s) Except as otherwise set forth in the Prospectus, there are
no legal or governmental proceedings pending to which the Company or
any of the Subsidiaries is a party or of which any of the Company's or
any of the Subsidiaries' properties or assets is the subject, the
result of which would, individually or in the aggregate, have a
Material
8
Adverse Effect, and, to the Company's knowledge, no such proceedings
are threatened or contemplated, except as disclosed in the Prospectus,
the result of which would, individually or in the aggregate, have a
Material Adverse Effect. To the Company's knowledge, there are no legal
or governmental proceedings pending to which any lessee, sublessee or
operator of any property of the Company or any Subsidiary or portion
thereof is a party, the result of which would, individually or in the
aggregate, have a Material Adverse Effect, and no such proceedings are
being threatened or contemplated, except as disclosed in the Prospectus
and the result of which would, individually or in the aggregate, have a
Material Adverse Effect. Neither the Company nor any of the
Subsidiaries has received from any governmental authority notice of any
violation of any local, state or federal law, rule or regulation
including without limitation any such law, rule or regulation
applicable to the health care industry ("HEALTH CARE LAWS") or relating
to human health or safety or the environment or any hazardous or toxic
substances or wastes, pollutants or contaminants ("ENVIRONMENTAL
LAWS"), except as disclosed in the Prospectus, the result of which
would, individually or in the aggregate, have a Material Adverse
Effect, and to the Company's knowledge, there is no such violation, or
any occurrence or circumstance that would give rise to a claim under or
pursuant to any local, state or federal law, rule or regulation
(including without limitation any Health Care Laws or Environmental
Laws), which would, individually or in the aggregate, have a Material
Adverse Effect. To the Company's knowledge, there is no violation of
any local, state or federal law, rule or regulation (including without
limitation Health Care Laws and Environmental Laws) by any person from
whom the Company or any of the Subsidiaries acquired any of its
properties (a "SELLER"), or any lessee, sublessee or operator of any of
their respective properties or any part thereof, the result of which
would, individually or in the aggregate, have a Material Adverse
Effect, and to the Company's knowledge, there is no such violation, or
any occurrence or circumstance that would give rise to a claim under or
pursuant to any local, state or federal law, rule or regulation
(including without limitation any Health Care Laws or Environmental
Laws), which would, individually or in the aggregate, have a Material
Adverse Effect, except as disclosed in the Prospectus. Neither the
Company nor any of the Subsidiaries has received from any governmental
authority any written notice of any condemnation of or zoning change
affecting the properties or any part thereof of the Company or any of
the Subsidiaries that individually or in the aggregate would have a
Material Adverse Effect and the Company does not know of any such
condemnation or zoning change which is threatened and which if
consummated individually or in the aggregate would have a Material
Adverse Effect. Nothing has come to the Company's attention that any
seller, lessee, sublessee or operator of any property of the Company or
any of the Subsidiaries, or portion thereof has, received from any
governmental authority any written notice of any condemnation of or
zoning change affecting the Properties or any part thereof of the
Company or any of the Subsidiaries that individually or in the
aggregate would have a Material Adverse Effect.
(t) Each of the Company and the Subsidiaries has good and
marketable title in fee simple or ground leases to the properties
disclosed in the Prospectus as being owned by them (the "PROPERTIES");
and the Properties are free and clear of all liens, encumbrances,
claims, mortgages, deeds of trust, restrictions, security interests and
defects ("PROPERTY ENCUMBRANCES"), except for: (i) the leasehold
interests of lessees in the
9
Company's and the Subsidiaries' properties held under lease (the
"LEASES"), (ii) any other Property Encumbrances that would not,
individually or in the aggregate, have a Material Adverse Effect and
(iii) those Property Encumbrances set forth in the Registration
Statement and Prospectus. All Property Encumbrances on or affecting the
properties of the Company or any of the Subsidiaries which are required
to be disclosed in the Prospectus are disclosed therein. Each of the
Leases pertaining to the properties of the Company or any of the
Subsidiaries has been duly authorized by the Company or one of the
Subsidiaries, as applicable, and is a valid and binding agreement of
the Company or one of the Subsidiaries, as applicable, and, to the
Company's knowledge, each other party thereto, enforceable in
accordance with its terms, except as enforcement thereof may be limited
by bankruptcy, insolvency, moratorium, fraudulent conveyance or other
similar laws affecting the enforcement of creditors' rights generally
and by general equitable principles. To the Company's knowledge, no
lessee of any portion of any of the properties of the Company or any of
the Subsidiaries is in default under its respective lease and there is
no event which, but for the passage of time or the giving of notice or
both, would constitute a default under any such lease, except such
defaults that would not, individually or in the aggregate, have a
Material Adverse Effect.
(u) The Company and each of the Subsidiaries and, to the
Company's knowledge, each of the operators, lessees or sublessees of
any property or portion thereof of the Company or any of the
Subsidiaries have such permits, licenses, approvals, certificates,
franchises and authorizations of governmental or regulatory authorities
("PERMITS"), including, without limitation, under any Health Care Laws
or Environmental Laws, as are necessary in the case of each such party
to acquire and own, lease or operate its properties and to conduct its
business, all as described in the Prospectus, except where the failure
to obtain such permits would not individually or in the aggregate have
a Material Adverse Effect; except as described in the Prospectus, the
Company and each of the Subsidiaries and, to the Company's knowledge,
each of the lessees, sublessees or operators of any property or portion
thereof of the Company or any of the Subsidiaries have fulfilled and
performed all of their obligations with respect to such permits and,
except as disclosed in the Prospectus, no event has occurred which
allows, or after notice or lapse of time would allow, revocation or
termination thereof or result in any other impairment of the rights of
the holder of any such permit, except where the failure to fulfill or
perform, or the resulting termination or impairment, would not,
individually or in the aggregate, have a Material Adverse Effect; and,
except as described in the Prospectus, such permits contain no
restrictions that are burdensome to the Company and the Subsidiaries,
taken as a whole and that would, individually or in the aggregate, have
a Material Adverse Effect.
(v) The financial statements, together with the related
schedules and notes, forming a part of the Registration Statement and
the Prospectus present fairly the consolidated financial position of
the Company and the Subsidiaries as of the dates indicated and the
consolidated results of operations and cash flows of the Company and
the Subsidiaries for the periods specified. Such financial statements
have been prepared in conformity with generally accepted accounting
principles applied on a consistent basis during the periods involved.
The pro forma financial statements and other pro forma financial data
included or incorporated by reference in the Registration Statement and
the
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Prospectus comply as to form in all material respects with the
applicable accounting requirements of Regulation S-X of the Act, and
the pro forma adjustments have been properly applied to the historical
amounts in the compilation of those statements. The other financial and
statistical data set forth in the Registration Statement and the
Prospectus are accurately presented and prepared on a basis consistent
with such financial statements and books and records of the Company.
There are no financial statements (historical or pro forma) that are
required to be included in the Registration Statement and the
Prospectus that are not included as required.
(w) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, there has
not been (i) any material adverse change, or any prospective material
adverse change, in the business, properties, condition (financial or
otherwise) or results of operations of the Company and the Subsidiaries
taken as a whole, (ii) any transaction which is material to the Company
or the Subsidiaries, (iii) any obligation, direct or contingent, which
is material to the Company and the Subsidiaries taken as a whole,
incurred by the Company or the Subsidiaries, (iv) any material change
in the outstanding shares of beneficial interest or material increase
in the outstanding indebtedness of the Company or the Subsidiaries or
(v) any dividend or distribution of any kind declared, paid or made on
the shares of beneficial interest of the Company or a dividend
distribution of any kind on any class of its shares of beneficial
interest (other than dividends or distributions from wholly-owned
subsidiaries of the Company) other than (A) regular quarterly
dividends, declared, paid or made and (B) the issuance of common shares
of beneficial interest to the trustees and officers pursuant to the
Company's Incentive Share Award Plan. None of the Company nor the
Subsidiaries has any material contingent obligation which is not
disclosed in the Registration Statement.
(x) Each of the Company and the Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amount as are customary in the business in which they
are engaged, except as described in the Prospectus. Except as would
not, individually or in the aggregate, have a Material Adverse Effect,
all policies of insurance insuring the Company and the Subsidiaries or
any of their businesses, assets, employees, officers, directors and
trustees are in full force and effect, and the Company and the
Subsidiaries are in compliance with the terms of such policies in all
material respects. Except as would not, individually or in the
aggregate, have a Material Adverse Effect, there are no claims by the
Company or any of the Subsidiaries under any such policy or instrument
as to which any insurance company is denying liability or defending
under a reservation of rights clause.
(y) Except as disclosed in the Registration Statement, neither
the Company nor any of the Subsidiaries has either sent or received any
communication regarding termination of, or intent not to renew, any of
the contracts or agreements referred to or described in, or filed as an
exhibit to, the Registration Statement or any Incorporated Document,
and no such termination or non-renewal has been threatened by the
Company or any of the Subsidiaries or any other party to any such
contract or agreement.
11
(z) Neither the Company nor any of the Subsidiaries or any of
their respective affiliates has taken, directly or indirectly, any
action designed to or which has constituted or which might reasonably
be expected to cause or result, under the Exchange Act or otherwise, in
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares.
(aa) The Company and the Subsidiaries have not sustained since
the date of the latest audited financial statements included in the
Prospectus any loss or interference with their businesses 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 disclosed in the Prospectus or other
than any loss or interference, which would individually or in the
aggregate not have a Material Adverse Effect.
(bb) The Company and the Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with
management's general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is permitted
only in accordance with management's general or specific authorization;
and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(cc) The Company and the Subsidiaries have filed all federal,
state, local and foreign tax returns and tax forms required to be
filed. Such returns and forms are complete and correct in all material
respects, and all taxes shown by such returns or otherwise assessed
that are due or payable have been paid, except such taxes as are being
contested in good faith and as to which adequate reserves have been
provided. All payroll withholdings required to be made by the Company
and the Subsidiaries with respect to employees have been made except
where the failure to fulfill or perform, would not, individually or in
the aggregate, have a Material Adverse Effect. The charges, accruals
and reserves on the books of the Company and the Subsidiaries in
respect of any tax liability for any year not finally determined are
adequate to meet any assessments or reassessments for additional taxes.
There have been no tax deficiencies asserted and, to the Company's
knowledge, no tax deficiency might be reasonably asserted or threatened
against the Company and/or the Subsidiaries that would individually or
in the aggregate have a Material Adverse Effect.
(dd) The outstanding Common Shares are, and the Shares will
be, subject to official notice of issuance and evidence of satisfactory
distribution, listed on the New York Stock Exchange (the "NYSE").
(ee) The Company meets the requirements for qualification and
taxation as a real estate investment trust ("REIT") under the Internal
Revenue Code of 1986, as amended (the "CODE").
12
(ff) The Company is not and, after giving effect to the
offering and sale of the Shares, will not be an "investment company" or
an entity "controlled" by an "investment company," as such terms are
defined in the Investment Company Act of 1940, as amended (the
"INVESTMENT COMPANY ACT").
4. CERTAIN COVENANTS. The Company hereby agrees:
(a) to furnish such information as may be required and
otherwise to cooperate in qualifying the Shares for offering and sale
under the securities or blue sky laws of such states as you may
designate and to maintain such qualifications in effect so long as
required for the distribution of the Shares; PROVIDED that the Company
shall not be required to qualify as a foreign corporation or to consent
to the service of process under the laws of any such state (except
service of process with respect to the offering and sale of the
Shares); and to promptly advise you of the receipt by the Company of
any notification with respect to the suspension of the qualification of
the Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose;
(b) to make available to the Underwriters in New York City as
many copies of the Prospectus (or of the Prospectus as amended or
supplemented if the Company shall have made any amendments or
supplements thereto) as the Underwriters may reasonably request for the
purposes contemplated by the Act; in case any Underwriter is required
to deliver a prospectus beyond the nine-month period referred to in
Section 10(a)(3) of the Act in connection with the sale of the Shares,
the Company will prepare promptly upon request, but at its expense,
such amendment or amendments to the Registration Statement and such
prospectuses as may be necessary to permit compliance with the
requirements of Section 10(a)(3) of the Act;
(c) to advise you promptly, confirming such advice in writing,
of any request by the Commission for amendments or supplements to the
Registration Statement or Prospectus or for additional information with
respect thereto, or of notice of institution of proceedings for, or the
entry of a stop order suspending the effectiveness of the Registration
Statement and, if the Commission should enter a stop order suspending
the effectiveness of the Registration Statement, to make every
reasonable effort to obtain the lifting or removal of such order as
soon as possible; to advise you promptly of any proposal to amend or
supplement the Registration Statement or Prospectus, including by
filing any documents that would be incorporated therein by reference
and to file no such amendment or supplement to which you shall object
in writing;
(d) to file promptly all reports and any definitive proxy or
information statement required to be filed by the Company with the
Commission in order to comply with the Exchange Act subsequent to the
date of the Prospectus and for so long as the delivery of a prospectus
is required in connection with the offering or sale of the shares, and
to promptly notify you of such filing;
(e) if, at the time this Agreement is executed and delivered,
it is necessary for the registration statement or a post-effective
amendment thereto or any Abbreviated Registration Statement to be
declared effective before the offering of the Shares may
13
commence, the Company will endeavor to cause the registration statement
or such post-effective amendment to become effective as soon as
possible and will advise you promptly and, if requested by you, will
confirm such advice in writing, when the registration statement or such
post-effective amendment has become effective;
(f) to furnish to you and, upon request, to each of the other
Underwriters for a period of three years from the date of this
Agreement (i) copies of any reports or other communications which the
Company shall send to its shareholders or shall from time to time
publish or publicly disseminate, (ii) copies of all annual, quarterly
and current reports filed with the Commission on Forms 10-K, 10-Q and
8-K, or such other similar form as may be designated by the Commission,
(iii) copies of documents or reports filed with any national securities
exchange on which any class of securities of the Company is listed, and
(iv) such other information as you may reasonably request regarding the
Company or the Subsidiaries, in each case as soon as such
communications, documents or information becomes available; PROVIDED,
HOWEVER, that in no case shall the Company be required to furnish
materials pursuant to this paragraph which are filed and publicly
accessible via XXXXX;
(g) to advise the Underwriters promptly of the happening of
any event known to the Company within the time during which a
Prospectus relating to the Shares is required to be delivered under the
Act which, in the judgment of the Company, would require the making of
any change in the Prospectus then being used, or in the information
incorporated therein by reference, so that the Prospectus would not
include an untrue statement of material fact or omit to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they are made, not misleading, and,
during such time, to prepare and furnish, at the Company's expense, to
the Underwriters promptly such amendments or supplements to such
Prospectus as may be necessary to reflect any such change and to
furnish you a copy of such proposed amendment or supplement before
filing any such amendment or supplement with the Commission;
(h) to make generally available to its security holders, and
to deliver to you, an earnings statement of the Company (which will
satisfy the provisions of Section 11(a) of the Act) covering a period
of twelve months beginning after the effective date of the Registration
Statement (as defined in Rule 158(c) of the Act) as soon as is
reasonably practicable after the termination of such twelve-month
period;
(i) to furnish to its shareholders as soon as practicable
after the end of each fiscal year an annual report (including a balance
sheet and statements of income, shareholders' equity and of cash flow
of the Company) for such fiscal year, accompanied by a copy of the
certificate or report thereon of nationally recognized independent
certified public accountants;
(j) to furnish to you one conformed copy of the Registration
Statement, as initially filed with the Commission, and of all
amendments thereto (including all exhibits thereto and documents
incorporated by reference therein) and sufficient conformed copies of
the foregoing (other than exhibits) for distribution of a copy to each
of the other Underwriters;
14
(k) to furnish to you as early as practicable prior to the
time of purchase and the additional time of purchase, as the case may
be, but not later than two business days prior thereto, a copy of the
latest available unaudited interim consolidated financial statements,
if any, of the Company and the Subsidiaries which have been read by the
Company's independent certified public accountants, as stated in their
letter to be furnished pursuant to Section 6(d) hereof;
(l) to apply the net proceeds from the sale of the Shares in
the manner set forth under the caption "Use of proceeds" in the
Prospectus;
(m) to pay all expenses, fees and taxes in connection with (i)
the preparation and filing of the Registration Statement, each
Preliminary Prospectus, the Prospectus, and any amendments or
supplements thereto, and the printing and furnishing of copies of each
thereof to the Underwriters and to dealers (including costs of mailing
and shipment), (ii) the issuance, sale and delivery of the Shares by
the Company, (iii) the word processing and/or printing of this
Agreement, any Agreement Among Underwriters and any dealer agreements
and the reproduction and/or printing and furnishing of copies of each
thereof to the Underwriters and to dealers (including costs of mailing
and shipment), (iv) the qualification of the Shares for offering and
sale under state laws and the determination of their eligibility for
investment under state law as aforesaid (including the legal fees and
filing fees and other disbursements of counsel to the Underwriters) and
the printing and furnishing of copies of any blue sky surveys or legal
investment surveys to the Underwriters and to dealers, (v) the filing
for review of the public offering of the Shares by NASD Regulation,
Inc. (including the legal fees and filing fees and other disbursements
of counsel to the Underwriters with respect thereto), (vi) any listing
of the Shares on any securities exchange and any registration thereof
under the Exchange Act, and (vii) the performance of the Company's
other obligations under this Agreement;
(n) to furnish to you, before filing with the Commission
subsequent to the effective date of the Registration Statement and
during the period referred to in paragraph (g) above, a copy of any
document proposed to be filed pursuant to Section 13, 14 or 15(d) of
the Exchange Act;
(o) not to sell, offer to sell, contract to sell, hypothecate,
pledge, grant any option to sell or otherwise dispose of, directly or
indirectly, any Common Shares or securities convertible into or
exchangeable or exercisable for Common Shares or options, warrants or
other rights to purchase Common Shares or any other shares of the
Company that are substantially similar to Common Shares or file a
registration statement under the Act relating to the offer and sale of
any Common Shares or securities convertible into or exchangeable or
exercisable for Common Shares or options, warrants or other rights to
purchase Common Shares or any other shares of the Company that are
substantially similar to Common Shares for a period of ninety (90) days
after the date hereof (the "LOCK-UP PERIOD"), without the prior written
consent of UBS Warburg LLC, except for (i) issuances of Common Shares
upon the exercise of outstanding options or warrants as disclosed in
the Registration Statement and the Prospectus to persons who have
entered into Lock-Up Agreements with the Underwriters, (ii) the
issuance of employee stock options not exercisable during the Lock-up
Period pursuant to stock option plans
15
described in the Registration Statement and the Prospectus, (iii)
issuances of Common Shares under the Company's Incentive Share Award
Plan described in the Registration Statement and the Prospectus and
(iv) issuances of Common Shares as partial or full payment for
properties directly or indirectly acquired or to be acquired by the
Company or its subsidiaries; PROVIDED that, the Company shall have
conditioned such issuances of Common Shares upon agreement of the
recipients to the restrictions of this paragraph;
(p) to use its best efforts to cause the Shares to be listed
on the NYSE; and
(q) to use its best efforts to continue to qualify as a REIT
under Sections 856 through 860 of the Code.
5. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Shares are
not delivered for any reason other than the termination of this Agreement
pursuant to clause (ii), (iii) or (iv) of the second paragraph of Section 7
hereof or pursuant to the last paragraph of Section 8 hereof or the default by
one or more of the Underwriters in its or their respective obligations
hereunder, the Company shall, in addition to paying the amounts described in
Section 4 hereof, reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of their counsel.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several
obligations of the Underwriters hereunder are subject to the accuracy of the
representations and warranties on the part of the Company on the date hereof and
at the time of purchase (and the several obligations of the Underwriters at the
additional time of purchase are subject to the accuracy of the representations
and warranties on the part of the Company on the date hereof and at the time of
purchase (unless previously waived) and at the additional time of purchase, as
the case may be), the performance by the Company of its obligations hereunder
and to the following additional conditions precedent:
(a) The Company shall furnish to you at the time of purchase
and at the additional time of purchase, as the case may be, an opinion
of Xxxxxxxx & Worcester LLP, counsel for the Company, addressed to the
Underwriters, and dated the time of purchase or the additional time of
purchase, as the case may be, with reproduced copies for each of the
other Underwriters and in form satisfactory to Xxxxx Xxxxxxxxxx LLP,
counsel for the Underwriters, stating that:
(i) the Company has been duly formed, is existing as
a real estate investment trust and is in good standing under
the laws of the State of Maryland, with trust power to own,
lease and operate its properties and conduct its business in
all material respects as described in the Registration
Statement and the Prospectus, to execute and deliver this
Agreement and to issue, sell and deliver the Shares as herein
contemplated;
(ii) the Company is duly qualified to transact
business and is in good standing in each of the jurisdictions
set forth on Schedule D attached hereto;
16
(iii) each Material Subsidiary is a corporation or
other legal entity duly formed, existing and in good standing
under the laws of its jurisdiction of organization, and is
duly qualified as a foreign corporation or other legal entity
and is in good standing in each of the jurisdictions set forth
on Schedule D attached hereto. Each Material Subsidiary has
the corporate, trust, partnership or other power to own or
hold under lease the properties it purports to own or hold
under lease and to transact the business it transacts and
proposes to transact. All of the issued and outstanding shares
of beneficial ownership of, or other ownership interests in,
each Material Subsidiary have been duly authorized and validly
issued, are fully paid and except as to Material Subsidiaries
that are limited liability companies or partnerships,
non-assessable, and except for SPTMRT Properties Trust, are
owned by the Company, directly or through subsidiaries, free
and clear of any security interest, mortgage, pledge, lien or
encumbrance;
(iv) this Agreement has been duly authorized,
executed and delivered by the Company, and is a legal, valid
and binding agreement of the Company, enforceable in
accordance with its terms, except as enforcement of the same
may be limited by bankruptcy, insolvency, moratorium,
fraudulent conveyance or other similar laws affecting the
enforcement of creditors' rights generally and by general
equitable principles and except as to those provisions
relating to indemnities for liabilities arising under the Act
as to which no opinion need be expressed;
(v) the Shares to be sold by the Company have been
duly authorized and, when issued and delivered to and paid for
by the Underwriters, will be validly issued, fully paid and
non-assessable and are not subject to preemptive or, to the
knowledge of such counsel, similar rights;
(vi) the Company has authorized and outstanding
shares of beneficial interest as set forth or incorporated by
reference in the Registration Statement and the Prospectus;
the outstanding shares of beneficial interest of the Company
have been duly and validly authorized and issued and are fully
paid, nonassessable and free of any preemptive rights, resale
rights, rights of first refusal and similar rights under any
contract, agreement or instrument to which the Company is a
party described in or filed as an exhibit to the Registration
Statement or otherwise known to such counsel;
(vii) the Registration Statement and the Prospectus
(except as to the financial statements and schedules and other
financial and statistical data contained therein, as to which
such counsel need express no opinion) comply as to form in all
material respects with the requirements of the Act;
(viii) the Registration Statement has become
effective under the Act and, to such counsel's knowledge, no
stop order proceedings with respect thereto are pending or
threatened under the Act and any required filing of the
Prospectus, and any supplement thereto pursuant to Rule 424
under the Act,
17
has been made in the manner and within the time period
required by such Rule 424;
(ix) the execution, delivery and performance of this
Agreement by the Company and the transactions contemplated
hereby do not and will not conflict with, or result in any
breach of, or constitute a violation under (nor constitute any
event which with notice, lapse of time, or both, would result
in any breach of, or constitute a default under) (A) any
provisions of the Declaration of Trust, charter, by-laws or
other organizational documents of the Company or any of the
Material Subsidiaries, (B) any provision of any material
agreement or other instrument to which the Company or any of
the Material Subsidiaries is a party or by which their
respective properties may be bound or affected, that is
described in the Prospectus or filed as an exhibit to the
Registration Statement or any Incorporated Document or is
otherwise known to such counsel or (C) any federal, state,
local or foreign law, regulation or rule, or any decree, to
which the Company or the Material Subsidiaries may be subject;
(x) to such counsel's knowledge, there are no
contracts, licenses, agreements, leases or documents of a
character which are required to be filed as exhibits to the
Registration Statement or to be described in the Prospectus
which have not been so filed or described;
(xi) to such counsel's knowledge, except as described
in the Prospectus or as would not, individually or in the
aggregate, have a Material Adverse Effect, there are no
private or governmental actions, suits, claims, investigations
or proceedings pending, threatened or contemplated to which
the Company or any of the Subsidiaries or any of their
officers is subject or of which any of their properties is
subject, whether at law, in equity or before or by any
federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency;
(xii) to such counsel's knowledge, no person has the
right, pursuant to the terms of any contract, agreement or
other instrument described in or filed as an exhibit to the
Registration Statement or any Incorporated Document, to cause
the Company to register under the Act any shares of beneficial
interest or other equity interests as a result of the filing
or effectiveness of the Registration Statement or the sale of
the Shares as contemplated hereby, except for such rights as
have been complied with or waived; and to the knowledge of
such counsel, except as described in the Registration
Statement and Prospectus, no person is entitled to
registration rights with respect to shares of capital stock or
other securities of the Company;
(xiii) the Company is not, and after the offering and
sale of the Shares, will not be, an "investment company," or
an entity controlled by an
18
"investment company," as such terms are defined in the
Investment Company Act; and
(xiv) to such counsel's knowledge the statements in
(i) the Registration Statement and the Prospectus under the
captions "Description of common shares", "Our tenants and
property operations", and "Federal income tax and ERISA
considerations"; (ii) the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 2000 under the captions
"Business--Financing Policies" (with respect to the first
paragraph only), "Business--Regulation and Reimbursement",
"Business--Government Regulations and Rate Setting"; (iii) the
September 21, 2001 8-K under the caption "B. Crestline
Transaction," as supplemented by the Company's Current Report
on Form 8-K dated November 5, 2001 and the Company's Current
Report on Form 8-K dated December 31, 2001; and (iv) the
Company's Current Report on Form 8-K dated February 13, 2001
under the caption "C. Federal Income Tax and ERISA
Considerations," in each case insofar as such statements
purport to summarize matters arising under Maryland,
Massachusetts or New York law or the federal law of the United
States, or provisions of documents as to which the Company is
a party specifically referred to therein, are accurate in all
material respects.
In addition, such counsel shall state that, in the opinion of
such counsel, and subject to the restrictions and limitations set forth in such
counsel's tax opinion filed as an exhibit to the Registration Statement and
reasonably acceptable to you, (a) the Company has qualified to be taxed as a
REIT under the Code for each of its fiscal years and (b) the proposed method of
operation described in the Prospectus and as represented to such counsel by the
Company will enable the Company to continue to satisfy the requirements for such
qualification for subsequent fiscal years under the Code. Such counsel may state
that actual qualification as a REIT, however, will depend upon the Company's
continued ability to meet, and its meeting, through actual annual operating
results and distributions, the various qualifying tests under the Code.
Also, such counsel shall state that it has participated in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants of the Company and
representatives of the Underwriters at which the contents of the Registration
Statement and Prospectus were discussed and, although such counsel is not
passing upon and does not assume responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement or
Prospectus (except as and to the extent stated in subparagraphs (vii) and (xiv)
above), on the basis of the foregoing nothing has come to the attention of such
counsel that causes them to believe that the Registration Statement or any
amendment thereto at the time such Registration Statement or amendment became
effective contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or that the Prospectus or any supplement thereto at the
date of the Prospectus Supplement or such other supplement, and at all times up
to and including the time of purchase or additional time of purchase, as the
case may be, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading (it being understood that such
19
counsel need express no opinion with respect to the financial statements and
schedules and other financial and statistical data and exhibits included or
incorporated by reference in the Registration Statement or Prospectus).
In rendering their opinion as aforesaid, Xxxxxxxx & Worcester
LLP may rely upon an opinion, dated as of the time of purchase or the additional
time of purchase, as the case may be, of Xxxxxxx Xxxxx Xxxxxxx & Ingersoll, LLP
as to matters governed by Maryland law, provided that such reliance is expressly
authorized by such opinion and a copy of such opinion is delivered to the
Underwriters and is, in form and substance, satisfactory to the Underwriters and
counsel for the Underwriters. In addition, in rendering such opinion, such
counsel may state that their opinion as to laws of the State of Delaware is
limited to the Delaware General Corporation Law and that their opinion with
respect to the qualification of the Company and is Subsidiaries to do business
in jurisdictions other than their respective jurisdiction of organization is
based solely upon certificates to such effect issued by an appropriate official
of the applicable jurisdictions.
(b) The Company shall furnish to you at the time of purchase
and at the additional time of purchase, as the case may be, an opinion
of Xxxxxxx Xxxxx Xxxxxxx & Xxxxxxxxx, LLP, special Maryland counsel of
the Company, addressed to the Underwriters, and dated the time of
purchase or the additional time of purchase, as the case may be, with
reproduced copies for each of the other Underwriters and in form
satisfactory to Xxxxx Xxxxxxxxxx LLP, counsel for the Underwriters,
stating that:
(i) the Company has been duly formed, is existing as
a real estate investment trust and is in good standing under
the laws of the State of Maryland, with trust power to own,
lease and operate its properties and conduct its business in
all material respects as described in the Registration
Statement and the Prospectus, to execute and deliver this
Agreement and to issue, sell and deliver the Shares as herein
contemplated;
(ii) each Subsidiary of the Company identified in
SCHEDULE E attached hereto (each a "MARYLAND SUBSIDIARY") is a
corporation or other legal entity duly formed, existing and in
good standing under the laws of its jurisdiction of
organization. Each Maryland Subsidiary has the trust power to
own or hold under lease the properties it purports to own or
hold under lease and to transact the business it transacts and
proposes to transact. All of the issued and outstanding shares
of beneficial interest of each Maryland Subsidiary have been
duly authorized and validly issued, are fully paid and
non-assessable and are owned by the Company, directly or
through subsidiaries, and to such counsel's knowledge, except
for SPTMRT Properties Trust, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or
equity;
(iii) the execution, delivery and performance of this
Agreement by the Company and the transactions contemplated
hereby and by the Registration Statement do not and will not
conflict with, or result in any breach of, or constitute a
default under (nor constitute any event which with notice,
lapse of time, or both, would result in any breach of, or
constitute a
20
default under) (A) any provisions of the Declaration of Trust,
charter or by-laws or other organizational documents of the
Company or any of the Maryland Subsidiaries or (B) any local
or state Maryland law or administrative regulation applicable
to the Company and the Maryland Subsidiaries;
(iv) the Company has authorized and outstanding
shares of beneficial interest as set forth or incorporated by
reference in the Registration Statement and the Prospectus;
the outstanding shares of beneficial interest of the Company
have been duly and validly authorized and issued by all
necessary trust action and are fully paid, nonassessable and
free of any preemptive rights, resale rights, rights of first
refusal and similar rights under the Maryland REIT Law; the
Shares being sold by the Company, when issued, will be duly
and validly authorized and issued by all necessary trust
action and are fully paid, nonassessable free of any
preemptive rights, resale rights, rights of first refusal and
similar rights under the Maryland REIT Law; and the
certificates for the Shares are in due and proper form and
conform in all material respects to the requirements of the
Maryland REIT Law;
(v) no approval, authorization, consent or order of
or filing with any Maryland governmental or regulatory
commission, board, body, authority or agency having
jurisdiction over the Company is required in connection with
the execution, delivery and performance of this Agreement, the
issuance and sale of the Shares being delivered at the time of
purchase and at the additional time of purchase, as the case
may be, or and the consummation of the transactions
contemplated hereby and by the Prospectus (In rendering the
opinion expressed in this paragraph (v), such counsel need
express no opinion concerning the securities laws of the State
of Maryland.);
(vi) to such counsel's knowledge the statements in
(i) the Registration Statement and the Prospectus under the
captions "Description of common shares" and "Description of
certain provisions of Maryland law and of our declaration of
trust and bylaws" and in each case insofar as such statements
purport to summarize matters arising under Maryland law are
accurate in all material respects;
(vii) to such counsel's knowledge, neither the
Company nor any of the Maryland Subsidiaries is in violation
of its Declaration of Trust, charter or by-laws or other
organizational documents or in violation of any local or state
Maryland law or administrative regulation applicable to the
Company and the Maryland Subsidiaries; and
(viii) except as described in the Registration
Statement and the Prospectus, all of the outstanding shares of
capital stock of each of the Maryland Subsidiaries that is a
REIT have been duly authorized and validly issued, are fully
paid and non-assessable, are owned by the Company.
21
(c) You shall have received at the time of purchase and at the
additional time of purchase, as the case may be, an opinion of Xxxxx
Xxxxxxxxxx LLP, counsel for the Underwriters, dated the time of
purchase and the additional time of purchase, as the case may be, with
respect to the issuance and sale of the Shares by the Company, the
Registration Statement, the Prospectus and such other related matters
as the Underwriters may require. In addition, Xxxxx Xxxxxxxxxx LLP may
rely on the opinion of Xxxxxxx Xxxxx Xxxxxxx & Xxxxxxxxx, LLP as to all
matters of Maryland law.
(d) You shall have received from Ernst & Young LLP, a letter
dated, respectively, the date of this Agreement and the time of
purchase and the additional time of purchase, as the case may be, and
addressed to the Underwriters (with reproduced copies for each of the
Underwriters) in the forms approved by Xxxxx Xxxxxxxxxx LLP, counsel
for the Underwriters.
(e) You shall have received from KPMG LLP, a letter dated,
respectively, the date of this Agreement and the time of purchase and
addressed to the Underwriters (with reproduced copies for each of the
Underwriters) in the forms approved by Xxxxx Xxxxxxxxxx LLP, counsel
for the Underwriters.
(f) You shall have received from Xxxxxx Xxxxxxxx LLP, a letter
dated, respectively, the date of this Agreement and the time of
purchase and addressed to the Underwriters (with reproduced copies for
each of the Underwriters) in the forms approved by Xxxxx Xxxxxxxxxx
LLP, counsel for the Underwriters.
(g) No amendment or supplement to the Registration Statement
or Prospectus, including documents deemed to be incorporated by
reference therein, shall have been made and to which you have objected
in writing.
(h) Prior to the time of purchase and the additional time of
purchase, as the case may be, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued
under the Act or proceedings initiated under Section 8(d) or 8(e) of
the Act; (ii) the Registration Statement and all amendments thereto, or
modifications thereof, if any, shall not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; and
(iii) the Prospectus and all amendments or supplements thereto, or
modifications thereof, if any, shall not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of
the circumstances under which they are made, not misleading.
(i) Between the time of execution of this Agreement and the
time of purchase and the additional time of purchase, as the case may
be, (i) no material and unfavorable change, financial or otherwise
(other than as referred to in the Registration Statement and
Prospectus), in the business, prospects, properties, condition of the
Company and the Subsidiaries taken as a whole shall occur or become
known and (ii) no transaction which is material and unfavorable to the
Company and the Subsidiaries taken as a whole shall have been entered
into by the Company or any of the Subsidiaries.
22
(j) Between the time of execution of this Agreement and the
time of purchase or the additional time of purchase, as the case may
be, there shall not have occurred any downgrading, nor shall any notice
or announcement have been given or made of (i) any intended or
potential downgrading or (ii) any review or possible change that does
not indicate an improvement, in the rating accorded any securities of
or guaranteed by the Company by any "nationally recognized statistical
rating organization," as that term is defined in Rule 436(g)(2) under
the Act.
(k) You shall have received the agreement (a "LOCK-UP
AGREEMENT") of each of Xxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxx, Xxxxx X.
Xxxxxxx, Xxxx X. Xxxxxxx and HRPT Properties Trust not to sell, offer
to sell, contract to sell, hypothecate, grant any option to sell or
otherwise dispose of, directly or indirectly, any Common Shares or
securities convertible into or exchangeable for Common Shares or
warrants or other rights to purchase Common Shares for a period of 90
days after the date of the Prospectus Supplement without the prior
written consent of UBS Warburg LLC.
(l) The Company will, at the time of purchase and the
additional time of purchase, as the case may be, deliver to you a
certificate of two of its executive officers to the effect that the
representations and warranties of the Company as set forth in this
Agreement are true and correct as of such date, that the Company has
performed such of its obligations under this Agreement as are to be
performed at or before the time of purchase and the conditions set
forth in paragraphs (h), (i) and (j) of this Section 6 have been met.
(m) The Company will, at the time of purchase and the
additional time of purchase, as the case may be, deliver to you a
certificate signed by the President of the Company substantially in
such form approved by you and counsel to the Underwriters, respecting
the Company's compliance, both prior to and after giving effect to the
transactions contemplated hereby, with the financial covenants set
forth in the Company's credit agreement and the Company's indenture
relating to the Company's 8 5/8% Senior Notes due 2012 and certain
other agreements and instruments respecting outstanding indebtedness of
the Company and the Subsidiaries.
(n) The Shares shall have been approved for listing on the New
York Stock Exchange.
The Company shall have furnished to you such other documents
and certificates as to the accuracy and completeness of any statement in the
Registration Statement and the Prospectus as of the time of purchase or the
additional time of purchase, as the case may be, as you may reasonably request.
7. EFFECTIVE DATE OF AGREEMENT; TERMINATION. This Agreement
shall become effective: (i) upon the execution and delivery hereof by the
parties hereto; or (ii) if, at the time this Agreement is executed and
delivered, it is necessary for the registration statement or a post-effective
amendment thereto or an Abbreviated Registration Statement to be declared or
become effective before the offering of the Shares may commence, when
notification of the effectiveness of the registration statement or such
post-effective amendment has been released by the
23
Commission or such Abbreviated Registration Statement has, pursuant to the
provisions of Rule 462 under the Act, become effective. Until such time as this
Agreement shall have become effective, it may be terminated by the Company, by
notifying you, or by you, as Underwriters, by notifying the Company.
The obligations of the several Underwriters hereunder shall be
subject to termination in the absolute discretion of you or any group of
Underwriters (which may include you) which has agreed to purchase in the
aggregate at least 50% of the Firm Shares (i) if, since the time of execution of
this Agreement or the respective dates as of which information is given in the
Registration Statement and Prospectus, (y) there has been any material adverse
and unfavorable change, financial or otherwise (other than as referred to in the
Registration Statement and Prospectus), in the business, prospects, properties,
condition (financial or otherwise) or results of operations of the Company and
the Subsidiaries taken as a whole, which would, in your judgment or in the
judgment of such group of Underwriters, make it impracticable to market the
Shares, or (z) there shall have occurred any downgrading, or any notice shall
have been given of (a) any intended or potential downgrading or (b) any review
or possible change that does not indicate an improvement, in the rating accorded
any securities of or guaranteed by the Company or any of the Subsidiaries by any
"nationally recognized statistical rating organization", as that term is defined
in Rule 436(g)(2) under the Act or (ii) if, at any time prior to the time of
purchase or, with respect to the purchase of any Additional Shares, the
additional time of purchase, as the case may be, trading in securities on the
NYSE, the American Stock Exchange or the Nasdaq Stock Market Inc. ("NASDAQ")
shall have been suspended or limitations or minimum prices shall have been
established on the NYSE, the American Stock Exchange or the Nasdaq or (iii) if,
at any time prior to the time of purchase or, with respect to the purchase of
any Additional Shares, the additional time of purchase, as the case may be, a
banking moratorium shall have been declared either by the United States or New
York State authorities, or (iv) if, at any time prior to the time of purchase
or, with respect to the purchase of any Additional Shares, the additional time
of purchase, as the case may be, the United States shall have declared war in
accordance with its constitutional processes or there shall have occurred any
material outbreak or escalation of hostilities or other national or
international calamity or crisis of such magnitude in its effect on the
financial markets of the United States as, in your judgment or in the judgment
of such group of Underwriters, to make it impracticable to market the Shares.
If you or any group of Underwriters elects to terminate this
Agreement as provided in this Section 7, the Company and each other Underwriter
shall be notified promptly by letter, telegram or telecopy.
If the sale to the Underwriters of the Shares, as contemplated
by this Agreement, is not carried out by the Underwriters for any reason
permitted under this Agreement or if such sale is not carried out because the
Company shall be unable to comply with any of the terms of this Agreement, the
Company shall not be under any obligation or liability under this Agreement
(except to the extent provided in Sections 4, 5 and 9 hereof), and the
Underwriters shall be under no obligation or liability to the Company under this
Agreement (except to the extent provided in Section 9 hereof) or to one another
hereunder.
24
8. INCREASE IN UNDERWRITERS' COMMITMENTS. Subject to Sections
6 and 7, if any Underwriter shall default in its obligation to take up and pay
for the Firm Shares to be purchased by it hereunder (otherwise than for reasons
sufficient to justify the termination of this Agreement under the provisions of
Section 7 hereof) and if the number of Firm Shares which all Underwriters so
defaulting shall have agreed but failed to take up and pay for does not exceed
10% of the total aggregate number of Firm Shares, the non-defaulting
Underwriters shall take up and pay for (in addition to the Firm Shares they are
obligated to purchase pursuant to Section 1 hereof) the Firm Shares agreed to be
purchased by all such defaulting Underwriters, as hereinafter provided. Such
Firm Shares shall be taken up and paid for by such non-defaulting Underwriter or
Underwriters in such numbers as you may designate with the consent of each
Underwriter so designated or, in the event no such designation is made, such
Firm Shares shall be taken up and paid for by all non-defaulting Underwriters
pro rata in proportion to the aggregate number of Firm Shares set opposite the
names of such non-defaulting Underwriters in SCHEDULE A.
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Company or you shall have the right
to postpone the time of purchase or the additional time of purchase, as the case
may be, for a period not exceeding five business days in order that any
necessary changes in the Prospectus and other documents may be effected.
The term Underwriter as used in this Agreement shall refer to
and include any Underwriter substituted under this Section 8 with like effect as
if such substituted Underwriter had originally been named in SCHEDULE A.
If the aggregate number of Shares which the defaulting
Underwriter or Underwriters agreed to purchase exceeds 10% of the total
aggregate number of Shares which all Underwriters agreed to purchase hereunder,
and if neither the non-defaulting Underwriters nor the Company shall make
arrangements within the five business day period stated above for the purchase
of all the Shares which the defaulting Underwriter or Underwriters agreed to
purchase hereunder, this Agreement shall be terminated without further act or
deed and without any liability on the part of the Company to any non-defaulting
Underwriter and without any liability on the part of any non-defaulting
Underwriter to the Company. Nothing in this paragraph, and no action taken
hereunder, shall relieve any defaulting Underwriter from liability in respect of
any default of such Underwriter under this Agreement.
9. INDEMNITY AND CONTRIBUTION.
(a) The Company agrees to indemnify, defend and hold harmless
each Underwriter, its partners, directors, officers, employees and agents and
any person who controls any Underwriter within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act, and the successors and assigns of all of
the foregoing persons, from and against any loss, damage, expense, liability or
claim (including the reasonable cost of investigation) which, jointly or
severally, any such Underwriter or any such person may incur under the Act, the
Exchange Act, the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, the Basic Prospectus, any Prepricing Prospectus,
25
any Prospectus Supplement or in the Prospectus (or in any of the foregoing as
the same may at any time be amended or supplemented), or arises out of or is
based upon any omission or alleged omission to state a material fact required to
be stated in the Registration Statement, the Basic Prospectus, any Prepricing
Prospectus, any Prospectus Supplement or the Prospectus (or in any of the
foregoing as the same may at any time be amended or supplemented) or necessary
to make the statements made therein not misleading, except insofar as any such
loss, damage, expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact contained in and
in conformity with information furnished by or on behalf of any Underwriter
through you to the Company expressly for use with reference to such Underwriter
in the Registration Statement, the Basic Prospectus, any Prepricing Prospectus,
any Prospectus Supplement or the Prospectus (or in any of the foregoing as the
same may at any time be amended or supplemented) or arises out of or is based
upon any omission or alleged omission to state a material fact in connection
with such information required to be stated in the Registration Statement, the
Basic Prospectus, any Prepricing Prospectus, any Prospectus Supplement or the
Prospectus (or in any of the foregoing as the same may at any time be amended or
supplemented) or necessary to make such information not misleading or (ii) any
untrue statement or alleged untrue statement made by the Company in Section 3 of
this Agreement or the failure by the Company to perform when and as required any
agreement or covenant contained herein or (iii) any untrue statement or alleged
untrue statement of any material fact contained in any audio or visual materials
provided by the Company or based upon written information furnished by or, with
the approval of the Company, on behalf of the Company including, without
limitation, slides, videos, films, tape recordings, used in connection with the
marketing of the Shares; PROVIDED, however, that, solely with regard to clause
(i), the foregoing indemnity agreement with respect to any Basic Prospectus or
Prepricing Prospectus shall not inure to the benefit of any Underwriter from
whom the person asserting such losses, claims, damages or liabilities purchased
Securities, or any person controlling the Underwriter, if sufficient copies of
the Prospectus were timely delivered to such Underwriter pursuant to Section 4
hereof and a copy of the Prospectus (as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) was not
given or sent to such person, if required by law to have been delivered, at or
prior to the written confirmation of the sale of the Securities to such person,
and if the Prospectus (as so amended or supplemented) would have cured the
defect giving rise to such losses, claims, damages or liabilities.
If any action, suit or proceeding (together, a "PROCEEDING")
is brought against an Underwriter or any such person in respect of which
indemnity may be sought against the Company pursuant to the foregoing paragraph,
such Underwriter or such person shall promptly notify the Company in writing of
the institution of such Proceeding and the Company shall assume the defense of
such Proceeding, including the employment of counsel reasonably satisfactory to
such indemnified party and payment of all fees and expenses related thereto;
PROVIDED, HOWEVER, that the omission to so notify the Company shall not relieve
the Company from any liability which the Company may have to any Underwriter or
any such person or otherwise. Such Underwriter or such person shall have the
right to employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such Underwriter or of such
person unless the employment of such counsel shall have been authorized in
writing by the Company in connection with the defense of such Proceeding or the
Company shall not have, within a reasonable period of time in light of the
circumstances, employed counsel to have charge of the defense of such Proceeding
or such indemnified party or
26
parties shall have reasonably concluded that there may be defenses available to
it or them which are different from, additional to or in conflict with those
available to the Company (in which case the Company shall not have the right to
direct the defense of such Proceeding on behalf of the indemnified party or
parties), in any of which events such fees and expenses shall be borne by the
Company and paid as incurred (it being understood, however, that the Company
shall not be liable for the expenses of more than one separate counsel (in
addition to any local counsel) in any one Proceeding or series of related
Proceedings in the same jurisdiction representing the indemnified parties who
are parties to such Proceeding). The Company shall not be liable for any
settlement of any such Proceeding effected without its prior written consent but
if settled with the prior written consent of the Company, the Company agrees to
indemnify and hold harmless any Underwriter and any such person from and against
any loss or liability by reason of such settlement. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second sentence of this paragraph, then the
indemnifying party agrees that it shall be liable for any settlement of any
Proceeding effected without its written consent if (i) such settlement is
entered into more than 60 business days after receipt by such indemnifying party
of the aforesaid request, (ii) such indemnifying party shall not have reimbursed
the indemnified party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the indemnifying
party at least 30 days' prior notice of its intention to settle. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened Proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such Proceeding and does not include an admission
of fault, culpability or a failure to act, by or on behalf of such indemnified
party.
(b) Each Underwriter severally agrees to indemnify, defend and
hold harmless the Company, its trustees, officers, employees and agents, and any
person who controls the Company within the meaning of Section 15 of the Act, or
Section 20 of the Exchange Act, from and against any loss, damage, expense,
liability or claim (including the reasonable cost of investigation) which,
jointly or severally, the Company or any such person may incur under the Act,
the Exchange Act, or common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon any untrue statement
or alleged untrue statement of a material fact contained in and in conformity
with information furnished by or on behalf of such Underwriter through you to
the Company expressly for use with reference to such Underwriter in the
Registration Statement, the Basic Prospectus, any Prepricing Prospectus, the
Prospectus Supplement or in the Prospectus (or in any of the foregoing as such
document may at any time be amended or supplemented) or arises out of or is
based upon any omission or alleged omission to state a material fact in
connection with such information required to be stated in the Registration
Statement, the Basic Prospectus, any Prepricing Prospectus, the Prospectus
Supplement or the Prospectus (or in any of the foregoing as such document may at
any time be amended or supplemented) or necessary to make such information not
misleading.
If any Proceeding is brought against the Company or any such
person in respect of which indemnity may be sought against any Underwriter
pursuant to the foregoing paragraph, the Company or such person shall promptly
notify such Underwriter in writing of the institution
27
of such Proceeding and such Underwriter shall assume the defense of such
Proceeding, including the employment of counsel reasonably satisfactory to such
indemnified party and payment of all fees and expenses, PROVIDED, HOWEVER, that
the omission to so notify such Underwriter shall not relieve such Underwriter
from any liability which such Underwriter may have to the Company or any such
person or otherwise. The Company or such person shall have the right to employ
its own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of the Company or such person unless the employment of
such counsel shall have been authorized in writing by such Underwriter in
connection with the defense of such Proceeding or such Underwriter shall not
have employed counsel to have charge of the defense of such Proceeding or such
indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from or additional to or in
conflict with those available to such Underwriter (in which case such
Underwriter shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties, but such Underwriter may employ
counsel and participate in the defense thereof but the fees and expenses of such
counsel shall be at the expense of such Underwriter), in any of which events
such fees and expenses shall be borne by such Underwriter and paid as incurred
(it being understood, however, that such Underwriter shall not be liable for the
expenses of more than one separate counsel (in addition to any local counsel) in
any one Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such Proceeding). No
Underwriter shall be liable for any settlement of any such Proceeding effected
without the written consent of such Underwriter but if settled with the written
consent of such Underwriter, such Underwriter agrees to indemnify and hold
harmless the Company and any such person from and against any loss or liability
by reason of such settlement. Notwithstanding the foregoing sentence, if at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second sentence of this paragraph, then the indemnifying party agrees
that it shall be liable for any settlement of any Proceeding effected without
its written consent if (i) such settlement is entered into more than 60 business
days after receipt by such indemnifying party of the aforesaid request, (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement and (iii) such
indemnified party shall have given the indemnifying party at least 30 days'
prior notice of its intention to settle. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement of any
pending or threatened Proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such Proceeding.
(c) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under subsections (a) and (b) of this
Section 9 in respect of any losses, damage, expenses, liabilities or claims
referred to therein, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, damages, expenses,
liabilities or claims (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
on the other hand from the offering of the Shares 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 Company on the one
hand and of the Underwriters on the
28
other in connection with the statements or omissions which resulted in such
losses, damages, expenses, liabilities or claims, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other shall be deemed to be in the same
respective proportion as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses) received
by the Company and the total underwriting discounts and commissions received by
the Underwriters, bear to the aggregate public offering price of the Shares. The
relative fault of the Company on the one hand and of the Underwriters on the
other shall be determined by reference to, among other things, whether the
untrue statement or alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The amount
paid or payable by a party as a result of the losses, damages, expenses,
liabilities and claims referred to in this subsection shall be deemed to include
any legal or other fees or expenses reasonably incurred by such party in
connection with investigating, preparing to defend or defending any claim or
Proceeding.
(d) The Company and the Underwriters agree that it would not
be just and equitable if contribution pursuant to this Section 9 were determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in subsection (c) above.
Notwithstanding the provisions of this Section 9, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by such Underwriter and distributed to
the public were offered to the public exceeds the amount of any damage which
such Underwriter has otherwise been required to pay by reason of such untrue
statement or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section 9 are several in proportion to their respective
underwriting commitments and not joint.
(e) The indemnity and contribution agreements contained in
this Section 9 and the covenants, warranties and representations of the Company
contained in this Agreement shall remain in full force and effect regardless of
any investigation made by or on behalf of any Underwriter, its partners,
directors, officers, employees or agents or any person (including each partner,
officer, director, employee or agent of such person) who controls any
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, or by or on behalf of the Company, its trustees, officers,
employees or agents or any person who controls the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, and shall survive any
termination of this Agreement or the issuance and delivery of the Shares. The
Company and each Underwriter agree promptly to notify each other of the
commencement of any Proceeding against it and, in the case of the Company,
against any of the Company's officers, trustees, employees or agents in
connection with the issuance and sale of the Shares, or in connection with the
Registration Statement or Prospectus.
10. NOTICES. Except as otherwise herein provided, all
statements, requests, notices and agreements shall be in writing or by telegram
and, if to the Underwriters, shall be sufficient in all respects if delivered or
sent to UBS Warburg LLC, 000 Xxxx Xxxxxx, Xxx Xxxx,
00
Xxx Xxxx 00000, Attention: Syndicate Department, with a copy to Xxxxx Xxxxxxxxxx
LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxxxx
X. Xxxxxx, and if to the Company, shall be sufficient in all respects if
delivered or sent to the Company at the offices of the Company at 000 Xxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxxx X. Xxxxxxx, President and
Chief Operating Officer, with a copy to Xxxxxxxx & Worcester LLP, Xxx Xxxx
Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxxxxxxx X. Xxxxxxxxxx,
Xx., Esq.
11. GOVERNING LAW; CONSTRUCTION. This Agreement and any claim,
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement (a "CLAIM"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of New
York. The Section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
12. SUBMISSION TO JURISDICTION. Except as set forth below, no
Claim may be commenced, prosecuted or continued in any court other than the
courts of the State of New York located in the City and County of New York or in
the United States District Court for the Southern District of New York, which
courts shall have jurisdiction over the adjudication of such matters, and the
Company consents to the jurisdiction of such courts and personal service with
respect thereto. The Company hereby consents to personal jurisdiction, service
and venue in any court in which any Claim arising out of or in any way relating
to this Agreement is brought by any third party against an Underwriter or any
indemnified party. Each Underwriter and the Company (on its behalf and, to the
extent permitted by applicable law, on behalf of its stockholders and
affiliates) waives all right to trial by jury in any action, proceeding or
counterclaim (whether based upon contract, tort or otherwise) in any way arising
out of or relating to this Agreement. The Company agrees that a final judgment
in any such action, proceeding or counterclaim brought in any such court shall
be conclusive and binding upon the Company and may be enforced in any other
courts in the jurisdiction of which the Company is or may be subject, by suit
upon such judgment.
13. PARTIES AT INTEREST. The Agreement herein set forth has
been and is made solely for the benefit of the Underwriters, the Company and to
the extent provided in Section 9 hereof the controlling persons, directors and
officers and, if applicable, trustees referred to in such Section, and their
respective successors, assigns, heirs, personal representatives and executors
and administrators. No other person, partnership, association or corporation
(including a purchaser, as such purchaser, from any of the Underwriters) shall
acquire or have any right under or by virtue of this Agreement.
14. INFORMATION FURNISHED BY THE UNDERWRITERS. The statements
set forth in the last sentence of the penultimate paragraph of the cover page of
the Prospectus Supplement and the statements set forth in the third and eighth
paragraphs under the caption "Underwriting" in the Prospectus Supplement
constitute the only information furnished by or on behalf of the Underwriters as
such information is referred to in Sections 3 and 9 hereof.
15. COUNTERPARTS. This Agreement may be signed by the parties
in one or more counterparts that together shall constitute one and the same
agreement among the parties.
30
16. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon the Underwriters, the Company and their respective successors and assigns
and any successor or assign of any substantial portion of the Company's and any
of the Underwriters' respective businesses and/or assets.
17. MISCELLANEOUS. UBS Warburg LLC, an indirect, wholly-owned
subsidiary of UBS AG, is not a bank and is separate from any affiliated bank,
including any U.S. branch or agency of UBS Warburg LLC. Because UBS Warburg LLC
is a separately incorporated entity, it is solely responsible for its own
contractual obligations and commitments, including obligations with respect to
sales and purchases of securities. Securities sold, offered or recommended by
UBS Warburg LLC are not deposits, are not insured by the Federal Deposit
Insurance Corporation, are not guaranteed by a branch or agency, and are not
otherwise an obligation or responsibility of a branch or agency.
A lending affiliate of UBS Warburg LLC may have lending
relationships with issuers of securities underwritten or privately placed by UBS
Warburg LLC. To the extent required under the securities laws, prospectuses and
other disclosure documents for securities underwritten or privately placed by
UBS Warburg LLC will disclose the existence of any such lending relationships
and whether the proceeds of the issue will be used to repay debts owed to
affiliates of UBS Warburg LLC.
THE ARTICLES OF AMENDMENT AND RESTATEMENT ESTABLISHING SENIOR
HOUSING PROPERTIES TRUST, DATED SEPTEMBER 20, 1999, A COPY OF WHICH, TOGETHER
WITH ALL AMENDMENTS THERETO, IS DULY FILED IN THE OFFICE OF THE DEPARTMENT OF
ASSESSMENTS AND TAXATION OF THE STATE OF MARYLAND, PROVIDES THAT THE NAME
"SENIOR HOUSING PROPERTIES TRUST" REFERS TO THE TRUSTEES UNDER THE DECLARATION
OF TRUST, BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE, OFFICER,
SHAREHOLDER, EMPLOYEE OR AGENT OF SENIOR HOUSING PROPERTIES TRUST SHALL BE HELD
TO ANY PERSONAL LIABILITY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, SENIOR
HOUSING PROPERTIES TRUST. ALL PERSONS DEALING WITH SENIOR HOUSING PROPERTIES
TRUST, SHALL LOOK ONLY TO THE ASSETS OF SENIOR HOUSING PROPERTIES TRUST FOR THE
PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.
31
If the foregoing correctly sets forth the understanding
between the Company and the Underwriters, please so indicate in the space
provided below for the purpose, whereupon this letter and your acceptance shall
constitute a binding agreement between the Company and the Underwriters
severally.
Very truly yours,
SENIOR HOUSING PROPERTIES TRUST
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President
Accepted and agreed to
as of the date first above written:
UBS WARBURG LLC
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
X.X. XXXXXXX & SONS, INC.
FIRST UNION SECURITIES, INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
XXXXXXX XXXXX & ASSOCIATES, INC.
RBC XXXX XXXXXXXX INC.
By: UBS WARBURG LLC
By: /s/ Xxxx Xxxxxxx
--------------------------
Name: Xxxx Xxxxxxx
Title: Director
By: /s/ Xxxxxx Xxxxxx
--------------------------
Name: Xxxxxx Xxxxxx
Title: Director
32
SCHEDULE A
Number of
Underwriter Firm Shares
----------- -----------
UBS Warburg LLC ................................................... 2,910,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ................ 2,910,000
X.X. Xxxxxxx & Sons, Inc. ......................................... 2,182,500
First Union Securities, Inc. ...................................... 2,182,500
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated .............................. 2,182,500
Xxxxxxx Xxxxx & Associates, Inc. .................................. 1,091,250
RBC Xxxx Xxxxxxxx Inc. ............................................ 1,091,250
CIBC World Markets Corp. .......................................... 75,000
Dresdner Kleinwort Xxxxxxxxxxx Securities LLC ..................... 75,000
J.J.B. Xxxxxxxx, X.X. Xxxxx, Inc. ................................. 75,000
ING Barings LLC ................................................... 75,000
XX Xxxxx Securities Corporation ................................... 75,000
Xxxxx Fargo Securities, LLC ....................................... 75,000
-----------
Total .................................. 15,000,000
===========
Schedule A-1
SCHEDULE B
SUBSIDIARY NAME
CCC Alpha Investments Trust
CCC Delaware Trust
CCC Financing I Trust
CCC Financing Limited, L.P.
CCC Investments I, L.L.C.
CCC Leisure Park Corporation
CCC of Kentucky Trust
CCC Ohio Healthcare Trust
CCC Pueblo Norte Trust
CCC Retirement Communities II, L.P.
CCC Retirement Partners Trust
CCC Retirement Trust
CCC Senior Living Corporation
CCCP Senior Living LLC
CCDE Senior Living LLC
CCFL Senior Living LLC
CCOP Senior Living LLC
CCSL Senior Living LLC
Crestline Ventures LLC
HRES1 Properties Trust
HRES2 Properties Trust
Leisure Park Venture Limited Partnership
LTJ Senior Communities LLC
Panther GenPar Trust
Panther Holdings Level I L.P.
SHOPCO-SD, LLC
SNH Capital Trust Holdings
SNH Capital Trust I
SNH Capital Trust II
SNH Capital Trust III
SNH/CSL Properties Trust
SPT-Michigan Trust
SPTGEN Properties Trust
SPTIHS Properties Trust
SPTMISC Properties Trust
SPTMNR Properties Trust
SPTMRT Properties Trust
SPTSUN II Properties Trust
SPTSUN Properties Trust
Schedule B-1
SCHEDULE C
MATERIAL SUBSIDIARIES
SPTMRT Properties Trust
SNH/CSL Properties Trust
Schedule C-1
SCHEDULE D
FOREIGN QUALIFICATIONS OF THE COMPANY
Massachusetts
FOREIGN QUALIFICATIONS OF SPMMRT PROPERTIES TRUST
Arizona
California
Florida
Maryland
Massachusetts
FOREIGN QUALIFICATIONS OF SNH/CSL PROPERTIES TRUST
Maryland
Massachusetts
Schedule D-1
SCHEDULE E
MARYLAND SUBSIDIARIES
CCC Alpha Investments Trust
CCC Delaware Trust
CCC Financing I Trust
CCC of Kentucky Trust
CCC Ohio Healthcare Trust
CCC Pueblo Norte Trust
CCC Retirement Partners Trust
CCC Retirement Trust
HRES1 Properties Trust
HRES2 Properties Trust
PantherGenpar Trust
SPT-Michigan Trust
SNH Capital Trust Holdings
SNH Capital Trust I
SNH Capital Trust II
SNH Capital Trust III
SNH/CSL Properties Trust
SPTGEN Properties Trust
SPTIHS Properties Trust
SPTMISC Properties Trust
SPTMNR Properties Trust
SPTMRT Properties Trust
SPTSUN Properties Trust
SPTSUN II Properties Trust
Schedule E-1
