[ ] SHARES
RESOURCE CAPITAL CORP.
COMMON STOCK
UNDERWRITING AGREEMENT
[ ], 2006
Credit Suisse Securities (USA) LLC
Friedman, Billings, Xxxxxx & Co., Inc.
Citigroup Global Markets Inc.
X.X. Xxxxxx Securities Inc.,
As Representatives of the Several Underwriters,
c/o Credit Suisse Securities (USA) LLC,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. Introductory. Resource Capital Corp., a Maryland corporation
("COMPANY") proposes to issue and sell [ ] shares (the "BASE SECURITIES") of its
common stock, par value $0.001 per share ("SECURITIES"), and the stockholders
listed in SCHEDULE A hereto ("SELLING STOCKHOLDERS") propose severally to sell
an aggregate of [ ] outstanding shares of the Securities (the "RESALE
SECURITIES" and, together with the Base Securities, "FIRM SECURITIES") to Credit
Suisse Securities (USA) LLC ("CSS"), Friedman, Billings, Xxxxxx & Co., Inc.
("FBR"), Citigroup Global Markets Inc. ("CITIGROUP"), X.X. Xxxxxx Securities
Inc. ("X.X. Xxxxxx") and each of the other underwriters named in SCHEDULE B
hereto (collectively, the "UNDERWRITERS"), for whom CSS, FBR, Citigroup and X.X.
Xxxxxx are acting as representatives, (in such capacity, the "REPRESENTATIVES").
The Company also proposes to sell to the Underwriters, at the option of the
Underwriters, an aggregate of not more than [ ] additional shares of its
Securities, as set forth below (such [ ] additional shares being hereinafter
referred to as the "OPTIONAL SECURITIES" and, together with the Base Securities,
the "ORIGINAL ISSUE SECURITIES"). The Firm Securities and the Optional
Securities are herein collectively called the "OFFERED SECURITIES." The Company,
Resource Capital Manager, Inc. (the "MANAGER"), and the Selling Stockholders
hereby agree with the Underwriters as follows:
2. Representations and Warranties of the Company, the Manager and the
Selling Stockholders.
(a) The Company represents and warrants to, and agrees with, the
several Underwriters that:
(i) A registration statement (No. 333-126517) relating to the
Offered Securities, including a form of prospectus, has been filed
with the Securities and Exchange Commission ("COMMISSION") and
either (A) has been declared effective under the Securities Act of
1933, as amended (the "ACT") and is not proposed to be amended or
(B) is proposed to be amended by amendment or post-effective
amendment. If such registration statement (the "INITIAL REGISTRATION
STATEMENT") has been declared effective, either (A) an additional
registration statement (the "ADDITIONAL REGISTRATION STATEMENT")
relating to the Offered Securities may have been filed with the
Commission pursuant to Rule 462(b) ("RULE 462(B)") under the Act
and, if so filed, has become effective upon filing pursuant to such
Rule and the Offered Securities all have been duly registered under
the Act pursuant to the initial registration statement and, if
applicable, the additional registration statement or (B) such an
additional registration statement is proposed to be filed with the
Commission pursuant to Rule 462(b) and will become effective upon
filing pursuant to such Rule and upon such filing the Offered
Securities will all have been duly registered under the Act pursuant
to the initial registration statement and such additional
registration statement. If the Company does not propose to amend the
initial registration statement or if an additional registration
statement has been filed and the Company does not propose to amend
it, and if any post-effective amendment to either such registration
statement has been filed with the Commission prior to the execution
and delivery of this Agreement, the most recent amendment (if any)
to each such registration statement has been declared effective by
the Commission or has become effective upon filing pursuant to Rule
462(c) ("RULE 462(C)") under the Act or, in the case of the
additional registration statement, Rule 462(b). For purposes of this
Agreement, "EFFECTIVE TIME" with respect to the initial registration
statement or, if filed prior to the execution and delivery of this
Agreement, the additional registration statement means (A) if the
Company has advised the Representatives that it does not propose to
amend such registration statement, the date and time as of which
such registration statement, or the most recent post-effective
amendment thereto (if any) filed prior to the execution and delivery
of this Agreement, was declared effective by the Commission or has
become effective upon filing pursuant to Rule 462(c), or (B) if the
Company has advised the Representatives that it proposes to file an
amendment or post-effective amendment to such registration
statement, the date and time as of which such registration
statement, as amended by such amendment or post-effective amendment,
as the case may be, is declared effective by the Commission. If an
additional registration statement has not been filed prior to the
execution and delivery of this Agreement but the Company has advised
the Representatives that it proposes to file one, "EFFECTIVE TIME"
with respect to such additional registration statement means the
date and time as of which such registration statement is filed and
becomes effective pursuant to Rule 462(b). "EFFECTIVE DATE" with
respect to the initial registration statement or the additional
registration statement (if any) means the date of the Effective Time
thereof. The initial registration statement, as amended at its
Effective Time, including all information contained in the
additional registration statement (if any) and deemed to be a part
of the initial registration statement as of the Effective Time of
the additional registration statement pursuant to the General
Instructions of the Form on which it is filed and including all
information (if any) deemed to be a part of the initial registration
statement as of its Effective Time pursuant to Rule 430A(b) ("RULE
430A(B)") under the Act, is hereinafter referred to as the "INITIAL
REGISTRATION STATEMENT." The additional registration statement, as
amended at its Effective Time, including the contents of the Initial
Registration Statement incorporated by reference therein and
including all information (if any) deemed to be a part of the
additional registration statement as of its Effective Time pursuant
to Rule 430A(b), is hereinafter referred to as the "ADDITIONAL
REGISTRATION STATEMENT." The Initial Registration Statement and the
Additional Registration are hereinafter referred to collectively as
the "REGISTRATION STATEMENTS" and individually as a "REGISTRATION
STATEMENT." "REGISTRATION STATEMENT" without reference to a time
means the Registration Statement as of its Effective Time.
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"REGISTRATION STATEMENT" as of any time means the initial
registration statement and any additional registration statement in
the form then filed with the Commission, including any amendment
thereto and any prospectus deemed or retroactively deemed to be a
part thereof that has not been superseded or modified. For purposes
of the previous sentence, information contained in a form of
prospectus or prospectus supplement that is deemed retroactively to
be a part of the Registration Statement pursuant to Rule 430A shall
be considered to be included in the Registration Statement as of the
time specified in Rule 430A. "STATUTORY PROSPECTUS" as of any time
means the prospectus included in the Registration Statement
immediately prior to that time, including any prospectus deemed to
be a part thereof that has not been superseded or modified. For
purposes of the preceding sentence, information contained in a form
of prospectus that is deemed retroactively to be a part of the
Registration Statement pursuant to Rule 430A shall be considered to
be included in the Statutory Prospectus as of the actual time that
form of prospectus is filed with the Commission pursuant to Rule
424(b) ("RULE 424(B)") under the Act. "PROSPECTUS" means the
Statutory Prospectus that discloses the public offering price and
other final terms of the Offered Securities and otherwise satisfies
Section 10(a) of the Act. "ISSUER FREE WRITING PROSPECTUS" means any
"issuer free writing prospectus," as defined in Rule 433, relating
to the Offered Securities in the form filed or required to be filed
with the Commission or, if not required to be filed, in the form
retained in the Company's records pursuant to Rule 433(g). "GENERAL
USE ISSUER FREE WRITING PROSPECTUS" means any Issuer Free Writing
Prospectus that is intended for general distribution to prospective
investors, as evidenced by its being specified in a schedule to this
Agreement. "LIMITED USE ISSUER FREE WRITING PROSPECTUS" means any
Issuer Free Writing Prospectus that is not a General Use Issuer Free
Writing Prospectus. "APPLICABLE TIME" means :00 [a/p]m (Eastern
time) on the date of this Agreement.
(ii) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement:
(A) on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all respects to the
requirements of the Act and the rules and regulations of the
Commission ("RULES AND Regulations") and did not include any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein (with respect to the Prospectus only, in light of the
circumstances under which they were made) not misleading, (B) on the
Effective Date of the Additional Registration Statement (if any),
each Registration Statement conformed or will conform, in all
respects to the requirements of the Act and the Rules and
Regulations and did not include, or will not include, any untrue
statement of a material fact and did not omit, or will not omit, to
state any material fact required to be stated therein or necessary
to make the statements therein not misleading, and (C) on the date
of this Agreement, the Initial Registration Statement and, if the
Effective Time of the Additional Registration Statement is prior to
the execution and delivery of this Agreement, the Additional
Registration Statement each conforms, and at the time of filing of
the Prospectus pursuant to Rule 424(b) or (if no such filing is
required) at the Effective Date of the Additional Registration
Statement in which the Prospectus is included, each Registration
Statement and the Prospectus will conform, in all respects to the
requirements of the Act and the Rules and Regulations, and neither
of such documents includes, or will include, any untrue statement of
a material fact or omits, or will omit, to state any material fact
required to be stated therein or necessary to make the statements
therein (with respect to the Prospectus only, in light of the
circumstances under which they were made) not misleading. If the
Effective Time of the Initial Registration Statement is subsequent
to the execution and delivery of this Agreement: on the Effective
Date of the Initial Registration Statement, the Initial Registration
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Statement and the Prospectus will conform in all respects to the
requirements of the Act and the Rules and Regulations, neither of
such documents will include any untrue statement of a material fact
or will omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading,
and no Additional Registration Statement has been or will be filed.
The two preceding sentences do not apply to statements in or
omissions from a Registration Statement or the Prospectus based upon
written information furnished to the Company by any Underwriter
through the Representatives specifically for use therein, it being
understood and agreed that the only such information is that
described as such in Section 8(b) hereof.
(iii) (a) At the time of filing the Registration Statement and
(b) at the date of this Agreement, the Company was not and is not an
"ineligible issuer," as defined in Rule 405, including (x) the
Company or any other subsidiary in the preceding three years not
having been convicted of a felony or misdemeanor or having been made
the subject of a judicial or administrative decree or order as
described in Rule 405 and (y) the Company in the preceding three
years not having been the subject of a bankruptcy petition or
insolvency or similar proceeding, not having had a registration
statement be the subject of a proceeding under Section 8 of the Act
and not being the subject of a proceeding under Section 8A of the
Act in connection with the offering of the Offered Securities, all
as described in Rule 405.
(iv) As of the Applicable Time, neither (a) the General Use
Issuer Free Writing Prospectus(es) issued at or prior to the
Applicable Time and the Statutory Prospectus, the documents attached
to this Agreement, the price to the public and underwriting discount
on the cover page of the Prospectus and the statements under the
caption "Description of Securities" in the Prospectus, all
considered together (collectively, the "GENERAL DISCLOSURE
PACKAGE"), nor (b) any individual Limited Use Issuer Free Writing
Prospectus, when considered together with the General Disclosure
Package, included any untrue statement of a material fact or omitted
to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading. The preceding sentence does not apply to
statements in or omissions from any prospectus included in the
Registration Statement or any Issuer Free Writing Prospectus in
reliance upon and in conformity with written information furnished
to the Company by any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that
the only such information furnished by any Underwriter consists of
the information described as such in Section 8(b) hereof.
(v) Each Issuer Free Writing Prospectus, as of its issue date
and at all subsequent times through the completion of the public
offer and sale of the Offered Securities or until any earlier date
that the Company notified or notifies CSS as described in the next
sentence, did not, does not and will not include any information
that conflicted, conflicts or will conflict with the information
then contained in the Registration Statement. If at any time
following issuance of an Issuer Free Writing Prospectus there
occurred or occurs an event or development as a result of which such
Issuer Free Writing Prospectus conflicted or would conflict with the
information then contained in the Registration Statement or included
or would include an untrue statement of a material fact or omitted
or would omit to state a material fact necessary in order to make
the statements therein, in light of the circumstances prevailing at
that subsequent time, not misleading, (i) the Company has promptly
notified or will promptly notify CSS and (ii) the Company has
promptly amended or will promptly amend or supplement such Issuer
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Free Writing Prospectus to eliminate or correct such conflict,
untrue statement or omission. The foregoing two sentences do not
apply to statements in or omissions from any Issuer Free Writing
Prospectus in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood
and agreed that the only such information furnished by any
Underwriter consists of the information described as such in Section
8(b) hereof.
(vi) The Company is a corporation duly organized and validly
existing and in good standing under the laws of the State of
Maryland with full power and authority to own, lease or operate its
assets and to conduct its business as described in the Prospectus
and to execute and deliver this Agreement and to consummate the
transactions contemplated hereby (including the issuance, sale and
delivery of the Original Issue Securities) and thereby.
(vii) Each subsidiary of the Company (the "SUBSIDIARIES") has
been duly incorporated or formed and is an existing corporation or
limited liability company in good standing under the laws of the
jurisdiction of its incorporation or formation, with power and
authority (corporate and other) to own, lease or operate its assets
and conduct its business as described in the Prospectus; all of the
issued and outstanding capital stock or membership interests, as
applicable, of each Subsidiary has been duly authorized and validly
issued and is fully paid and nonassessable; and except as disclosed
in the Prospectus, the capital stock or membership interests, as
applicable, of each Subsidiary is owned entirely by the Company,
directly or through subsidiaries, and is free from liens,
encumbrances and defects. Except as disclosed in the Prospectus, the
Company does not own any capital stock of or other equity interest
in any other corporation, limited liability company, partnership,
joint venture, trust or other entity or association.
(viii) The Company had, as of the date of the Prospectus, the
duly authorized and outstanding capitalization, as set forth in the
Prospectus under the caption "Capitalization;" all of the issued and
outstanding shares of capital stock of the Company have been duly
and validly authorized and issued and are fully paid and
non-assessable and have been issued in compliance with all federal
and state securities laws and, except as disclosed in the
Prospectus, free of preemptive rights and other rights to subscribe
for or purchase securities; except as disclosed in the Prospectus,
there are no outstanding (i) securities or obligations of the
Company or the Subsidiaries convertible into or exchangeable for any
capital stock of the Company or the Subsidiaries, (ii) warrants,
rights or options to subscribe for or purchase from the Company or
the Subsidiaries any such capital stock or any such convertible or
exchangeable securities or obligations or (iii) obligations of the
Company or the Subsidiaries to issue or sell any shares of capital
stock, partnership interests or membership interests, as applicable,
any such convertible or exchangeable securities or obligation, or
any such warrants, rights or options.
(ix) The Original Issue Securities have been duly authorized
for issuance and sale and, when issued by the Company and delivered
against payment therefor in accordance with the terms of this
Agreement, will be validly issued, fully paid and non-assessable,
free and clear of any pledge, lien, encumbrance, security interest
or other claim, and the issuance, sale and delivery of the Original
Issue Securities by the Company is not subject to any preemptive
right, co-sale right, registration right, resale right, right of
first refusal or other similar rights arising by operation of law,
under the Company Charter Documents, as such term is defined in
Section 2(xvi), (other than as set forth therein) or under any
5
agreement to which the Company is a party or otherwise, other than
as provided for in the Lock-Up Agreements (as defined below).
(x) Each of the Company and the Subsidiaries is duly qualified
or licensed by, and is in good standing in, each jurisdiction in
which it currently conducts its business or in which it owns or
leases property or maintains an office and in which such
qualification or licensing is necessary and in which the failure,
individually or in the aggregate, to be so qualified or licensed
could have, individually or in the aggregate, a material adverse
effect on the condition (financial or other), business, earnings,
management, properties, results of operations (as described in the
Prospectus), assets or prospects of the Company and the Subsidiaries
taken as a whole (a "MATERIAL ADVERSE EFFECT").
(xi) The Company has good and marketable title in fee simple
to all real property and good title to all personal property owned
by it, in each case free and clear of all liens, security interests,
pledges, charges, encumbrances, mortgages and defects, except such
as are disclosed in the Prospectus or such as would not reasonably
be expected to materially and adversely affect the value of such
property or interfere with the use made or proposed to be made of
such property by the Company; any real property or personal property
held under lease by the Company is held under a lease which is
valid, binding and enforceable against the Company and, to the
Company's knowledge, the other party thereto, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally, and by general
principles of equity, or as otherwise disclosed in the Prospectus or
exceptions that are not, individually or in the aggregate, material
to the Company and would not reasonably be expected to interfere
with the use made or proposed to be made of such property by the
Company.
(xii) Each of the Company and the Subsidiaries is in
compliance with all applicable federal, state, local and foreign
laws, rules, regulations, orders, decrees and judgments, except
where the failure to so comply could not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.
(xiii) Neither the Company nor any of the Subsidiaries has any
employees.
(xiv) Except as otherwise disclosed in the Prospectus, there
are no outstanding loans or advances or guarantees of indebtedness
by the Company to or for the benefit of any of the officers,
directors, affiliates or representatives of the Company or any of
the members of the families of any of them.
(xv) Except for the Underwriter's discount and any other
compensation payable by the Company to the Underwriters in
connection with the transactions contemplated herein or as otherwise
disclosed in the Prospectus, the Company has not incurred any
liability for any brokerage commissions, finder's fees or similar
payments in connection with the transactions herein contemplated.
(xvi) Each of the Company and the Subsidiaries is not (a) in
breach of, or in default under (nor has any event occurred which
with notice, lapse of time, or both would constitute a breach of, or
default under), its articles of incorporation, by-laws, certificate
of formation, operating agreement or similar organizational
documents, as applicable (collectively, the "COMPANY CHARTER
DOCUMENTS") or (b) in breach or default (nor has any event occurred
6
which with notice, lapse of time or both would constitute a breach
or default) in the performance or observance of any of its
obligations, agreements, covenants or conditions contained in any
license, indenture, mortgage, deed of trust, bank loan or credit
agreement or other agreement or instrument to which the Company or
the Subsidiaries is a party or by which it or its assets may be
bound or affected except, in the case of clause (b) only, for
breaches or defaults that could not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect; the
execution, delivery and performance of this Agreement, the issuance,
sale and delivery of the Original Issue Securities by the Company,
the consummation by the Company of the transactions contemplated
hereby and compliance by the parties thereto (other than the
Underwriters) with the terms and provisions hereunder 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 constitute a breach of, or default under), (A) any
provision of the Company Charter Documents, (B) any of the Company's
and the Subsidiaries' and any of their respective affiliates'
obligations under any provision of any license, indenture, mortgage,
deed of trust, bank loan or credit agreement or other agreement or
instrument to which any such party is a party or by which it or its
assets may be bound or affected, or (C) under any federal, state,
local or foreign law, regulation or rule or any decree, judgment,
permit or order applicable to the Company or the Subsidiaries
except, in the case of clauses (B) and (C) only, for such conflicts,
breaches or defaults that could not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
(xvii) This Agreement has been duly authorized, executed and
delivered by the Company, assuming due authorization, execution and
delivery of this Agreement by the Underwriters, is a legal, valid
and binding agreement of the Company, enforceable in accordance with
its terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors'
rights generally, and by general principles of equity, and except to
the extent that the indemnification provisions hereof may be limited
by federal or state securities laws and public policy considerations
in respect thereof; the Registration Rights Agreement ("REGISTRATION
RIGHTS AGREEMENT"), dated March 8, 2005, among the Company on one
hand, and CSS for the benefit of the Holders, on the other hand, and
the Management Agreement ("MANAGEMENT AGREEMENT"), dated March 8,
2005, by and among the Company, the Manager and Resource America,
have been duly authorized, executed and delivered by the Company and
Resource America, as applicable, and, assuming due authorization,
execution and delivery by such other parties, constitute legal,
valid and binding agreements of the Company and Resource America, as
applicable, enforceable against the Company and Resource America, as
applicable, in accordance with their terms, except as may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting creditors' rights generally, and by general
principles of equity, and except to the extent that the
indemnification provisions thereof may be limited by federal or
state securities laws and public policy considerations in respect
thereof.
(xviii) The capital stock of the Company, including the
Offered Securities, conforms in all material respects to the
descriptions thereof contained in the Prospectus; the form of
certificates used to evidence the Offered Securities complies in all
material respects with all applicable statutory requirements and any
requirements of the New York Stock Exchange (the "NYSE") and with
any applicable requirements of the Company Charter Documents and has
been duly authorized and approved by the directors of the Company.
7
(xix) Except for the Registration Rights Agreement and the
Management Agreement, there are no contracts, agreements or
understandings between the Company and any person granting such
person the right to require the Company to file a registration
statement under the Act with respect to any securities of the
Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered
pursuant to a registration statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act.
(xx) The Securities have been approved for listing subject to
notice of issuance on the NYSE.
(xxi) No approval, authorization, consent or order of or
filing with any federal, state, local or foreign governmental or
regulatory commission, board, body, authority or agency is required
for the execution, delivery and performance by the Company of this
Agreement, the consummation by the Company of the transactions
contemplated hereby, or the issuance, sale and delivery of the
Original Issue Securities as contemplated hereby, except such as
have been obtained and made, or as may be required, under the Act,
under the rules and regulations of the National Association of
Securities Dealers (the "NASD"), and such as may be required under
state or foreign securities laws.
(xxii) Each of the Company and the Subsidiaries has all
necessary licenses, authorizations, consents and approvals and has
made all necessary filings required under any federal, state, local
or foreign law, regulation or rule, and has obtained all necessary
licenses, authorizations, consents and approvals from other persons,
required in order to conduct its business as it is being conducted
at this time, and will obtain all necessary licenses,
authorizations, consents and approvals and make all necessary
filings required under any federal, state, local or foreign law,
regulation or rule, and will obtain all necessary licenses,
authorizations, consents and approvals from other persons, required
in order to conduct its business as it is proposed to be conducted
as described in the Prospectus except, in each case, where the
failure to obtain any such license, authorization, consent or
approval could not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect; each of the Company and
the Subsidiaries is not in violation of, or in default under, any of
its obligations under any such license, authorization, consent or
approval of any federal, state, local or foreign law, regulation or
rule or any decree, order or judgment applicable to the Company and
the Subsidiaries except where such violation or default could not
reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.
(xxiii) The Company and the Subsidiaries own, possess or can
acquire on reasonable terms, adequate trademarks, trade names and
other rights to inventions, know-how, patents, copyrights,
confidential information and other intellectual property
(collectively, "INTELLECTUAL PROPERTY RIGHTS") necessary to conduct
the business now operated by them, or presently employed by them,
and have not received any notice of infringement of or conflict with
asserted rights of others with respect to any intellectual property
rights that, if determined adversely to the Company or any of the
Subsidiaries, would individually or in the aggregate have a Material
Adverse Effect.
(xxiv) The Prospectus contains summaries, which are complete
and accurate in all material respects, of all material contracts,
agreements, instruments and other documents, if any, of the Company
that would be required to be described in a prospectus included in a
8
registration statement on Form S-11 under the Act, and the copies of
all such contracts, agreements, instruments and other documents
(including all amendments or waivers relating to any of the
foregoing) that have been previously furnished to the Underwriters
or its counsel are complete and genuine and include all material
collateral and supplemental agreements thereto.
(xxv) There are no actions, suits, proceedings, inquiries or
investigations pending or, to the knowledge of the Company,
threatened against the Company or the Subsidiaries, or any of their
respective assets, and to the knowledge of the Company, its
respective directors, officers or employees at law or in equity, or
before or by any federal, state, local or foreign governmental or
regulatory commission, board, body, arbitration panel, authority or
agency the adverse outcome of which could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.
(xxvi) Since the date of the Prospectus, except as disclosed
therein, there has not been (a) any event, circumstance or change
that could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect, (b) any transaction, other
than in the ordinary course of business, which is material to the
Company contemplated or entered into by or on behalf of the Company
or the Subsidiaries, (c) any liability or obligation, contingent or
otherwise, directly or indirectly incurred by the Company or the
Subsidiaries, other than liabilities and obligations incurred in the
ordinary course of business, (d) any dividend or distribution of any
kind declared, paid or made by the Company on any class of its
capital stock, (e) any purchase or pledge by the Company or the
Subsidiaries of any of the Company's or the Subsidiaries'
outstanding capital stock or (f) any change in the capital stock,
long-term debt (including off-balance sheet activities or
transactions) or, outside the ordinary course of business,
short-term debt of the Company or the Subsidiaries.
(xxvii) The Company is not, and the sale of the Original Issue
Securities as herein contemplated and the receipt of the net
proceeds therefrom will not cause the Company to become, 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.
(xxviii) Neither the Company nor any of its directors,
officers, representatives or affiliates has taken, directly or
indirectly, any action intended, or which might reasonably be
expected, to cause or result in, or which has constituted, any
unlawful stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the Offered
Securities; and the Company acknowledges that the Underwriters may
engage in passive market making transactions in the Offered
Securities on the NYSE in accordance with Regulation M under the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT").
(xxix) Xxxxx Xxxxxxxx LLP is an independent registered public
accounting firm with respect to the Company within the meaning of
the Act and the applicable published rules and regulations
thereunder, and the rules and regulations of the Public Company
Accounting Oversight Board ("PCAOB") of the United States.
(xxx) The Company has not taken any action, nor have any other
steps been taken or have any legal proceedings been commenced, nor
9
to the knowledge of the Company, threatened, against the Company,
for the winding up, liquidation or dissolution of the Company.
(xxxi) Each of the independent directors named in the
Prospectus has not since the formation of the Company been employed
by or affiliated, directly or indirectly with, the Company whether
by ownership of, ownership interest in, employment by, any material
business or professional relationship with, or serving as an officer
or director of the Company or any of its affiliates named in the
Prospectus and satisfies the independence standards established by
the Commission and the NYSE.
(xxxii) The Company's investment guidelines and operating
policies described in the Prospectus accurately reflect the current
intentions of the Company and the Manager with respect to the
operation of its business, and no material deviation from such
guidelines or policies is contemplated.
(xxxiii) The Company has not authorized anyone to make any
representations regarding the offer and sale of the Offered
Securities, or regarding the Company in connection therewith, except
as set forth in the Prospectus or any related marketing materials
developed jointly and approved by the Company and the Underwriters;
the Company has not received notice of any stop order or other
similar order or decree preventing the use of the Prospectus or any
amendment or supplement thereto, and no proceeding for that purpose
has commenced or is pending or, to the Company's knowledge, is
contemplated.
(xxxiv) The Company will make a timely election to be subject
to tax as a real estate investment trust (a "REIT") pursuant to
Sections 856 through 860 of the Internal Revenue Code of 1986, as
amended (the "CODE") for its taxable year ending December 31, 2005
and commencing with its initial taxable year ending December 31,
2005, the Company has been organized and operated in conformity with
the requirements for qualification and taxation as a REIT under the
Code, and the Company's current and proposed method of operation
will enable it to continue to meet the requirements for
qualification and taxation as a REIT under the Code; and all
statements regarding the Company's qualification and taxation as a
REIT and descriptions of the Company's organization and current and
proposed method of operation set forth in the Prospectus are true,
complete and correct in all material respects.
(xxxv) The Company and each of the Subsidiaries have filed on
a timely basis all federal, state, local and foreign income and
franchise tax returns, if any such returns were required to be
filed, through the date hereof, any such returns are correct and
complete, and the Company has paid all taxes shown as due thereon;
and no tax deficiency has been asserted against the Company or any
of the Subsidiaries, nor does the Company or any of the Subsidiaries
know of any tax deficiency which could reasonably be expected to be
asserted against it; all tax liabilities, if any, are adequately
provided for on the consolidated books of the Company.
(xxxvi) The Company and the Subsidiaries, in the aggregate,
carry, or are covered by, insurance (issued by insurers of
recognized financial responsibility to the best knowledge of the
Company and the Manager) against such losses and risks and in such
amounts as are generally deemed adequate for the respective
businesses in which they are engaged; neither the Company nor any of
the Subsidiaries has been refused any insurance coverage sought or
applied for; and neither the Company nor any of the Subsidiaries has
10
any reason to believe that the Company or the Subsidiaries would not
be able to renew its existing insurance coverage as and when such
coverage expires or to obtain similar coverage from similar insurers
as may be necessary to continue its business at a cost that would
not, individually or in the aggregate have a Material Adverse
Effect, except as described in or contemplated by the Prospectus.
All such insurance is fully in force on the date hereof and will be
fully in force at the First Closing Date and any Optional Closing
Date.
(xxxvii) The Company and each of the Subsidiaries are in
compliance in all material respects with all presently applicable
provisions of the Employee Retirement Income Security Act of 1974,
as amended, including the regulations and published interpretations
thereunder ("ERISA"), and the employee benefits provisions of the
Code with which compliance is intended; no "reportable event" (as
defined in ERISA) has occurred with respect to any "pension plan"
(as defined in ERISA) for which the Company or any of the
Subsidiaries have or would reasonably be expected to have any
liability; the Company and the Subsidiaries have not incurred and do
not expect to incur liability under (x) Title IV of ERISA with
respect to termination of, or withdrawal from, any "pension plan" or
(y) Sections 412 or 4971 of the Code; and each "pension plan" for
which the Company would have any liability that is intended to be
qualified under Section 401(a) of the Code has received a
determination letter from the Internal Revenue Service to the effect
that it is so qualified in all material respects and nothing has
occurred, whether by action or by failure to act, which would cause
the plan to not be adversely affected by such determination.
(xxxviii) Except as set forth in the Prospectus, (a) no person
has any preemptive rights, co-sale rights, registration rights,
resale rights, rights of first refusal or other similar rights
arising by operation of law to purchase any shares of common stock
or shares of any other capital stock or other equity interests of
the Company or the Subsidiaries, and (b) no person has the right to
act as an underwriter or as a financial advisor to the Company or
the Subsidiaries in connection with the offer and sale of the
Offered Securities or capital stock or other equity interests of the
Subsidiaries.
(xxxix) Each of the Company and the Subsidiaries are in
compliance, in all material respects, with applicable Environmental
Laws (as defined below) and is in compliance, in all material
respects, with the material terms of any required permits, licenses,
authorizations and approvals required under, applicable
Environmental Laws, except to the extent that failure to so comply
or to hold such permits, authorizations or approvals would not
reasonably be expected to have a Material Adverse Effect; there are
no past or present or, to the Company's knowledge, reasonably
anticipated material future events, conditions, circumstances,
activities, practices, actions, omissions or plans that could
reasonably be expected to give rise to any material costs or
liabilities to the Company or the Subsidiaries under, or to
interfere with or prevent compliance by the Company or the
Subsidiaries with, applicable Environmental Laws; except as would
not reasonably be expected to have a Material Adverse Effect, and
except that no representation is made with respect to any property
underlying loans originated or held by the Company or any of the
Subsidiaries, other than properties on which the Company or any
Subsidiary has foreclosed and currently holds as an asset
("FORECLOSURE PROPERTY"), neither the Company nor any of the
Subsidiaries (a) is the subject of any investigation, (b) has
received any notice or claim, (c) is a party to or affected by any
pending or threatened action, suit or proceeding, (d) is bound by
any judgment, decree or order or (e) has entered into any agreement,
in each case relating to any alleged violation of any applicable
11
Environmental Law or any actual or alleged release or, to the
knowledge of the Company, threatened release or cleanup at any
location of any Hazardous Materials (as defined below) (as used
herein, "ENVIRONMENTAL LAW" means any federal, state, local or
foreign law, statute, ordinance, rule, regulation, order, decree,
judgment, injunction, or other binding requirement, or common law,
relating to health, safety or the protection, cleanup or restoration
of the environment or natural resources, including those relating to
the distribution, processing, generation, treatment, storage,
disposal, transportation, other handling or release or threatened
release of Hazardous Materials, and "HAZARDOUS MATERIALS" means any
material (including, without limitation, pollutants, contaminants,
hazardous or toxic substances or wastes) that is regulated by or may
give rise to liability under any Environmental Law).
(xl) The assets of the Company and the Subsidiaries do not
constitute "plan assets" of an ERISA regulated employee benefit
plan.
(xli) The financial statements included in the Registration
Statement and the Prospectus present fairly the financial position
of the Company and its consolidated subsidiaries as of the dates
shown and their results of operations and cash flows for the periods
shown, and, except as otherwise disclosed in the Prospectus, such
financial statements have been prepared in conformity with the
generally accepted accounting principles ("GAAP") in the United
States applied on a consistent basis. The "As Adjusted" column and
the related notes thereto under the caption "Capitalization" in each
of the Registration Statement and Prospectus has been prepared in
accordance with the Commission's rules and guidelines with respect
to pro forma financial statements and have been properly compiled on
the bases described therein, and the Company believes that the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein have been properly applied to the
historical amounts in the compilation of the information.
(xlii) As of the First Closing Date, the Company will be
subject to the reporting requirements of either Section 13 or
Section 15(d) of the Exchange Act, and thereafter will file reports
with the Commission on the Electronic Data Gathering, Analysis, and
Retrieval (XXXXX) system.
(xliii) To the Company's or any of the Subsidiaries'
knowledge, except for Anthem Securities, Inc. and Xxxxxxxx
Securities, Inc., there are no affiliations or associations between
any member of the NASD and any of the Company's or any of the
Subsidiaries' officers, directors or 5% or greater securityholders,
except as set forth in the Prospectus.
(xliv) Each of the Company and the Subsidiaries (i) makes and
keeps accurate books and records in all material respects and (ii)
maintains internal accounting controls which provide reasonable
assurance that (A) transactions are executed in accordance with
management's authorization, (B) transactions are recorded as
necessary to permit preparation of its and the Subsidiaries'
financial statements in conformity with GAAP and to maintain
accountability for its and the Subsidiaries' assets, (C) access to
its assets is permitted only in accordance with management's
authorization, (D) the reported accountability for its and the
Subsidiaries' assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any
differences and (E) management is made aware of all material
transactions concerning the Company and the Subsidiaries and their
respective properties.
12
(xlv) Neither the Company nor the Subsidiaries, or, to the
knowledge of the Company and the Manager, any director, officer,
agent, employee or other person associated with or acting on behalf
of the Company or the Subsidiaries has: used any corporate funds for
any unlawful contribution, gift, entertainment or other unlawful
expense relating to political activity; made any direct or indirect
unlawful payment to any foreign or domestic government official or
employee from corporate funds; violated or is in violation of any
provision or the Foreign Corrupt Practices Act of 1977, as amended,
and the rules and regulations thereunder; or made any bribe, rebate,
payoff, influence payment, kickback or other unlawful payment; and
the Company, the Subsidiaries and, to the knowledge of the Company,
its affiliates have conducted their businesses in compliance in all
material respects with the Foreign Corrupt Practices Act of 1977 and
have instituted and maintain policies and procedures designed to
ensure, and which are reasonably expected to continue to ensure,
continued compliance therewith.
(xlvi) To the knowledge of the Company, neither it nor any of
the Subsidiaries nor any of its properties or assets has any
immunity from the jurisdiction of any court or from any legal
process (whether through service or notice, attachment prior to
judgment, attachment in aid of execution or otherwise) under the
laws of New York.
(xlvii) There is and has been no failure on the part of the
Company and any of the Company's directors or officers, in their
capacities as such, to comply in all material respects with any
provision of the Xxxxxxxx-Xxxxx Act of 2002 and the rules and
regulations promulgated in connection therewith (the "XXXXXXXX-XXXXX
ACT"), including Section 402 related to loans and Sections 302 and
906 related to certifications.
(xlviii) Any industry, statistical and market-related data
included in the Registration Statement and the Prospectus are based
on or derived from sources that the Company believes to be reliable
and accurate, and the Company has obtained the written consent to
the use of such data from such sources to the extent required.
(xlix) Accompanied by delivery of a Statutory Prospectus, any
advertising, sales literature or other promotional material
(including "prospectus wrappers", "broker kits," "road show slides"
and "road show scripts" and "electronic road show presentations")
authorized in writing by or prepared by the Company used in
connection with the public offering of the Offered Securities
(collectively, "sales material") does 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. Moreover, accompanied by delivery of a
Statutory Prospectus, all sales material complied and will comply in
all material respects with the applicable requirements of the Act
and the rules and interpretations of the NASD.
(l) Any certificate signed by any officer of the Company or
any of the Subsidiaries delivered pursuant to this Agreement to the
Representatives or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to each Underwriter as to
the matters covered thereby.
(b) The Manager represents and warrants to, and agrees with, the
several Underwriters that:
(i) The Manager is a limited liability company duly organized
and validly existing and in good standing under the laws of the
State of Delaware with full power and authority to own, lease or
13
operate its assets and to conduct its business as described in the
Prospectus and to execute and deliver this Agreement and to
consummate the transactions contemplated hereby and thereby.
(ii) The Manager is duly qualified or licensed by, and is in
good standing in, each jurisdiction in which it currently conducts
its business or in which it owns or leases property or maintains an
office and in which such qualification or licensing is necessary and
in which the failure, individually or in the aggregate, to be so
qualified or licensed could have, individually or in the aggregate,
a Material Adverse Effect.
(iii) The Manager is in compliance with all applicable
federal, state, local and foreign laws, rules, regulations, orders,
decrees and judgments, including those relating to transactions with
affiliates, except where the failure to so comply could not
reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.
(iv) The Manager is not (a) in breach of, or in default under
(nor has any event occurred which with notice, lapse of time, or
both would constitute a breach of, or default under), its articles
of incorporation or by-laws (collectively, the "MANAGER CHARTER
DOCUMENTS") or (b) in breach or default (nor has any event occurred
which with notice, lapse of time or both would constitute a breach
or default) in the performance or observance of any of its
obligations, agreements, covenants or conditions contained in any
license, indenture, mortgage, deed of trust, bank loan or credit
agreement or other agreement or instrument to which the Manager is a
party or by which it or its assets may be bound or affected except,
in the case of clause (b) only, for breaches or defaults that could
not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect; the execution, delivery and
performance of this Agreement, the consummation by the Manager of
the transactions contemplated hereby and compliance by the parties
thereto (other than the Underwriters) with the terms and provisions
hereunder 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 constitute a breach of, or
default under), (A) any provision of the Manager Charter Documents,
(B) any of the Manager's and any of their respective affiliates'
obligations under any provision of any license, indenture, mortgage,
deed of trust, bank loan or credit agreement or other agreement or
instrument to which any such party is a party or by which it or its
assets may be bound or affected, or (C) under any federal, state,
local or foreign law, regulation or rule or any decree, judgment,
permit or order applicable to the Manager except, in the case of
clauses (B) and (C) only, for such conflicts, breaches or defaults
that could not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.
(v) No approval, authorization, consent or order of or filing
with any federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency is required for the
execution, delivery and performance by the Manager of this
Agreement, the consummation by the Manager of the transactions
contemplated hereby, or the issuance, sale and delivery of the
Offered Securities as contemplated hereby, except such as have been
obtained and made, or as may be required, under the Act, under the
rules and regulations of the National Association of Securities
Dealers (the "NASD"), and such as may be required under state or
foreign securities laws.
(vi) The Manager has all necessary licenses, authorizations,
consents and approvals and has made all necessary filings required
under any federal, state, local or foreign law, regulation or rule,
14
and has obtained all necessary licenses, authorizations, consents
and approvals from other persons, required in order to conduct its
business as it is being conducted at this time, and will obtain all
necessary licenses, authorizations, consents and approvals and make
all necessary filings required under any federal, state, local or
foreign law, regulation or rule, and will obtain all necessary
licenses, authorizations, consents and approvals from other persons,
required in order to conduct its business as it is proposed to be
conducted as described in the Prospectus except, in each case, where
the failure to obtain any such license, authorization, consent or
approval could not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect; the Manager is not in
violation of, or in default under, any of its obligations under any
such license, authorization, consent or approval of any federal,
state, local or foreign law, regulation or rule or any decree, order
or judgment applicable to the Manager except where such violation or
default could not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.
(vii) No labor dispute with the employees of the Manager
exists or, to the knowledge of the Manager, is imminent that might
have a Material Adverse Effect.
(viii) There are no actions, suits, proceedings, inquiries or
investigations pending or, to the knowledge of the Manager,
threatened against the Manager, and to the knowledge of the Manager,
its respective directors, officers or employees at law or in equity,
or before or by any federal, state, local or foreign governmental or
regulatory commission, board, body, arbitration panel, authority or
agency the adverse outcome of which could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.
(ix) Since the date of the Prospectus, there has not been any
event, circumstance or change that could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.
(x) The Manager and its subsidiaries, in the aggregate, carry,
or are covered by, insurance (issued by insurers of recognized
financial responsibility to the best knowledge of the Manager)
against such losses and risks and in such amounts as are generally
deemed adequate for the respective businesses in which they are
engaged; neither the Manager nor any of its subsidiaries has been
refused any insurance coverage sought or applied for; and neither
the Manager nor any of its subsidiaries has any reason to believe
that the Manager or its subsidiaries would not be able to renew its
existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary to
continue its business at a cost that would not, individually or in
the aggregate have a Material Adverse Effect, except as described in
or contemplated by the Prospectus. All such insurance is fully in
force on the date hereof and will be fully in force at the First
Closing Date and any Optional Closing Date.
(xi) Neither the Manager, or, to the knowledge of the Manager,
any director, officer, agent, employee or other person associated
with or acting on behalf of the Manager has: used any corporate
funds for any unlawful contribution, gift, entertainment or other
unlawful expense relating to political activity; made any direct or
indirect unlawful payment to any foreign or domestic government
official or employee from corporate funds; violated or is in
violation of any provision or the Foreign Corrupt Practices Act of
1977, as amended, and the rules and regulations thereunder; or made
any bribe, rebate, payoff, influence payment, kickback or other
15
unlawful payment; and the Manager and, to the knowledge of the
Manager, its affiliates have conducted their businesses in
compliance in all material respects with the Foreign Corrupt
Practices Act of 1977 and have instituted and maintain policies and
procedures designed to ensure, and which are reasonably expected to
continue to ensure, continued compliance therewith.
(xii) This Agreement has been duly authorized, executed and
delivered by the Manager and, assuming due authorization, execution
and delivery of this Agreement by the Underwriters, is a legal,
valid and binding agreement of the Manager, enforceable in
accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally, and by general principles of equity,
and except to the extent that the indemnification provisions hereof
may be limited by federal or state securities laws and public policy
considerations in respect thereof; the Management Agreement has been
duly authorized, executed and delivered by the Manager and, assuming
due authorization, execution and delivery by such other parties,
constitutes a legal, valid and binding agreement of the Manager
enforceable against the Manager in accordance with its terms, except
as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights generally,
and by general principles of equity, and except to the extent that
the indemnification provisions thereof may be limited by federal or
state securities laws and public policy considerations in respect
thereof.
(c) Each Selling Stockholder severally represents and warrants to,
and agrees with, the several Underwriters that:
(i) Such Selling Stockholder has and on the First Closing Date
will have valid and unencumbered title to the Resale Securities to
be delivered by such Selling Stockholder on such Closing Date and
full right, power and authority to enter into this Agreement and to
sell, assign, transfer and deliver the Resale Securities to be
delivered by such Selling Stockholder on the First Closing Date
hereunder; and upon the delivery of and payment for the Resale
Securities on the First Closing Date the several Underwriters will
acquire valid and unencumbered title to the Resale Securities to be
delivered by such Selling Stockholder on the First Closing Date.
(ii) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement:
(A) on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all respects to the
requirements of the Act and the Rules and Regulations and did not
include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, (B) on the Effective Date of the
Additional Registration Statement (if any), each Registration
Statement conformed, or will conform, in all respects to the
requirements of the Act and the Rules and Regulations did not
include, or will not include, any untrue statement of a material
fact and did not omit, or will not omit, to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, and (C) on the date of this Agreement, the
Initial Registration Statement and, if the Effective Time of the
Additional Registration Statement is prior to the execution and
delivery of this Agreement, the Additional Registration Statement
each conforms, and at the time of filing of the Prospectus pursuant
to Rule 424(b) or (if no such filing is required) at the Effective
Date of the Additional Registration Statement in which the
Prospectus is included, each Registration Statement and the
Prospectus will conform, in all respects to the requirements of the
Act and the Rules and Regulations, and neither of such documents
includes, or will include, any untrue statement of a material fact
16
or omits, or will omit, to state any material fact required to be
stated therein or necessary to make the statements therein (with
respect to the Prospectus only, in light of the circumstances under
which they were made) not misleading. If the Effective Time of the
Initial Registration Statement is subsequent to the execution and
delivery of this Agreement: on the Effective Date of the Initial
Registration Statement, the Initial Registration Statement and the
Prospectus will conform in all respects to the requirements of the
Act and the Rules and Regulations, neither of such documents will
include any untrue statement of a material fact or will omit to
state any material fact required to be stated therein or necessary
to make the statements therein (with respect to the Prospectus only,
in light of the circumstances under which they were made) not
misleading. The two preceding sentences apply only to the extent
that any statements in or omissions from a Registration Statement or
the Prospectus are based on written information furnished to the
Company by such Selling Stockholder specifically for use therein.
(iii) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between such Selling
Stockholder and any person that would give rise to a valid claim
against such Selling Stockholder or any Underwriter for a brokerage
commission, finder's fee or other like payment in connection with
this offering.
(iv) This Agreement has been duly authorized, executed and
delivered by or on behalf of such Selling Stockholder.
(v) The Power of Attorney and Custody Agreement, in the form
heretofore furnished to the Representatives (the "POWER OF ATTORNEY
AND CUSTODY AGREEMENT"), has been duly authorized, executed and
delivered by such Selling Stockholder and is the valid and binding
agreement of such Selling Stockholder.
(vi) The execution and delivery of this Agreement and the
Power of Attorney and Custody Agreement and the sale and delivery of
the Resale Securities to be sold by such Selling Stockholder and the
consummation of the transactions contemplated herein and compliance
by such Selling Stockholder with its obligations hereunder do not
and will not, whether with or without the giving of notice or
passage of time or both, (a) conflict with or constitute a breach
of, or default under, or result in the creation or imposition of any
tax, lien, charge or encumbrance upon the Resale Securities to be
sold by such Selling Stockholder or any property or assets of such
Selling Stockholder pursuant to any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, license, lease or
other agreement or instrument to which such Selling Stockholder is a
party or by which such Selling Stockholder may be bound, or to which
any of the property or assets of such Selling Stockholder is
subject, nor (b) will such action result in any violation of the
provisions of the charter or bylaws or other organizational
instrument of such Selling Stockholder, if applicable, or any
applicable treaty, law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over such Selling
Stockholder or any of its properties except, in the case of clause
(a), for such conflicts, breaches or defaults that would not have,
or reasonably be expected to have, a material adverse effect on the
condition (financial or otherwise), business, earnings, properties,
results of operations (as described in the Prospectus), assets or
prospects of such Selling Stockholder and its subsidiaries taken as
a whole ("SELLING STOCKHOLDER MATERIAL ADVERSE EFFECT").
17
(vii) Such Selling Stockholder has and at the Closing will
have, valid title to the Resale Securities to be sold by such
Selling Stockholder free and clear of all security interests,
claims, liens, equities or other encumbrances and the legal right
and power, and all authorization and approval required by law, to
enter into this Agreement and the Power of Attorney and Custody
Agreement and to sell, transfer and deliver the Resale Securities to
be sold by such Selling Stockholder.
(viii) Such Selling Stockholder has not taken, and will not
take, directly or indirectly, any action which is designed to or
which has constituted or might reasonably be expected to cause or
result in stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the Resale
Securities in violation of Regulation M of the Act.
(ix) To the knowledge of such Selling Stockholder, no filing
with, or consent, approval, authorization, order, registration,
qualification or decree of, any court or governmental authority or
agency, domestic or foreign, is necessary or required for the
performance by each Selling Stockholder of its obligations hereunder
or in the Power of Attorney and Custody Agreement, or in connection
with the sale and delivery of the Resale Securities hereunder or the
consummation of the transactions contemplated by this Agreement,
except (a) such as may have previously been made or obtained or as
may be required under the Act or the Rules and Regulations or state
securities laws and (b) such as have been obtained under the laws
and regulations of jurisdictions outside the United States in which
the Resale Securities are offered or the absence of which would not
have, or reasonably be expected to have, a Selling Stockholder
Material Adverse Effect.
(x) Except as otherwise provided in the Registration
Statement, neither such Selling Stockholder nor any of its
affiliates directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common
control with, or is a person associated with (within the meaning of
Article I(dd) of the By-laws of the National Association of
Securities Dealers, Inc.), any member firm of the NASD.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company and each Selling
Stockholder agree, severally and not jointly, to sell to each Underwriter, and
each Underwriter agrees, severally and not jointly, to purchase from the Company
and each Selling Stockholder, at a purchase price of $[ ] per share, that
number of Firm Securities (rounded up or down, as determined by the
Representatives in their discretion, in order to avoid fractions) obtained by
multiplying [ ] Firm Securities in the case of the Company and the number of
Firm Securities set forth opposite the name of such Selling Stockholder in
SCHEDULE A hereto, in the case of a Selling Stockholder, in each case by a
fraction the numerator of which is the number of Firm Securities set forth
opposite the name of such Underwriter in SCHEDULE B hereto and the denominator
of which is the total number of Firm Securities, plus any additional number of
Securities which such Underwriters may become obligated to purchase pursuant to
Section 9. American Stock Transfer & Trust Company shall act as custodian (the
"CUSTODIAN") of the Resale Securities to be sold by the Selling Stockholders
pursuant to the Power of Attorney and Custody Agreement.
The Company and the Custodian will deliver the Firm Securities to the
Representatives for the accounts of the Underwriters, against payment of the
purchase price in Federal (same day) funds by wire transfer to accounts
specified by the Company, in the case of the Original Issue Securities, and by
the Custodian, in the case of the Resale Securities, at the office of Xxxxxxxx
Chance US LLP, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000, at 10:00 A.M., New York
time, on [ ], 2006, or at such other time not later than seven full business
18
days thereafter as the Representatives and the Company determine, such time
being herein referred to as the "FIRST CLOSING DATE." For purposes of Rule
15c6-1 under the Exchange Act, the First Closing Date (if later than the
otherwise applicable settlement date) shall be the settlement date for payment
of funds and delivery of securities for all the Offered Securities sold pursuant
to the offering. The certificates for the Firm Securities so to be delivered
will be in definitive form, in such denominations and registered in such names
as the Representatives request and will be made available for checking and
packaging at the above office of Xxxxxxxx Chance US LLP at least 24 hours prior
to the First Closing Date.
In addition, upon written notice from CSS given to the Company from
time to time not more than 30 days subsequent to the date of the Prospectus, the
Underwriters may purchase all or less than all of the Optional Securities at the
purchase price per Security to be paid for the Firm Securities. The Company
agrees to sell to the Underwriters the number of Optional Securities specified
in such notice and the Underwriters agree, severally and not jointly, to
purchase such Optional Securities. Such Optional Securities shall be purchased
from the Company for the account of each Underwriter in the same proportion as
the number of Firm Securities set forth opposite such Underwriter's name bears
to the total number of Firm Securities (subject to adjustment by the
Representatives to eliminate fractions) and may be purchased by the Underwriters
only for the purpose of covering over-allotments made in connection with the
sale of the Firm Securities. No Optional Securities shall be sold or delivered
unless the Firm Securities previously have been, or simultaneously are, sold and
delivered. The right to purchase the Optional Securities or any portion thereof
may be exercised from time to time and to the extent not previously exercised
may be surrendered and terminated at any time upon notice by the Representatives
to the Company.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "OPTIONAL CLOSING DATE", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "CLOSING DATE"), shall be determined by the
Representatives but shall be not later than five full business days after
written notice of election to purchase Optional Securities is given. The Company
will deliver the Optional Securities being purchased on each Optional Closing
Date to the Representatives for the accounts of the several Underwriters,
against payment of the purchase price therefor in Federal (same day) funds by
wire transfer to an account specified by the Company, at the above office of
Xxxxxxxx Chance US LLP. The certificates for the Optional Securities being
purchased on each Optional Closing Date will be in definitive form, in such
denominations and registered in such names as the Representatives requests upon
reasonable notice prior to such Optional Closing Date and will be made available
for checking and packaging at the above office of Xxxxxxxx Chance US LLP at a
reasonable time in advance of such Optional Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. Certain Agreements of the Company, the Manager and the Selling
Stockholders. The Company and the Manager, for so long as the Manager is the
manager under the Management Agreement, hereby jointly and severally agree with
the several Underwriters and, with respect to subsections (i) and (j), each
Selling Stockholder agrees with the Underwriters that:
(a) The Company has filed or will file each Statutory Prospectus
pursuant to and in accordance with Rule 424(b)(1) (or, if applicable and
consented to by the Representatives, subparagraph (4)) not later than the second
business day following the earlier of the date it is first used or the date of
this Agreement. The Company has complied and will comply with Rule 433.
19
(b) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company will file the
Prospectus with the Commission pursuant to and in accordance with subparagraph
(1) (or, if applicable and if consented to by the Representatives, subparagraph
(4)) of Rule 424(b) not later than the earlier of (A) the second business day
following the execution and delivery of this Agreement or (B) the fifteenth
business day after the Effective Date of the Initial Registration Statement.
The Company will advise the Representatives promptly of any such filing
pursuant to Rule 424(b). If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement and an
Additional Registration Statement is necessary to register a portion of the
Offered Securities under the Act but the Effective Time thereof has not occurred
as of such execution and delivery, the Company will file the Additional
Registration Statement or, if filed, will file a post-effective amendment
thereto with the Commission pursuant to and in accordance with Rule 462(b) on or
prior to 10:00 P.M., New York time, on the date of this Agreement or, if
earlier, on or prior to the time the Prospectus is printed and distributed to
any Underwriter, or will make such filing at such later date as shall have been
consented to by the Representatives.
(c) The Company will advise the Representatives promptly of any
proposal to amend or supplement the Initial Registration Statement, the
Additional Registration Statement (if any) or any Statutory Prospectus and will
not effect such amendment or supplementation without the consent of the
Representatives; and the Company will also advise the Representatives promptly
of the effectiveness of each Registration Statement (if its Effective Time is
subsequent to the execution and delivery of this Agreement) and of any amendment
or supplementation of a Registration Statement or any Statutory Prospectus and
of the institution by the Commission of any stop order proceedings in respect of
a Registration Statement and will use its best efforts to prevent the issuance
of any such stop order and to obtain as soon as possible its lifting, if issued.
(d) If, at any time when a prospectus relating to the Offered
Securities is (or but for the exemption in Rule 172 would be required to be)
delivered under the Act in connection with sales by any Underwriter or dealer,
any event occurs as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus to comply with the Act, the
Company will promptly notify the Representatives of such event and will promptly
prepare and file with the Commission, at its own expense, an amendment or
supplement which will correct such statement or omission or an amendment which
will effect such compliance. Neither Representatives' consent to, nor the
Underwriters' delivery of, any such amendment or supplement shall constitute a
waiver of any of the conditions set forth in Section 7.
(e) As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its
securityholders an earnings statement covering a period of at least 12 months
beginning after the Effective Date of the Initial Registration Statement (or, if
later, the Effective Date of the Additional Registration Statement) which will
satisfy the provisions of Section 11(a) of the Act. For the purpose of the
preceding sentence, "AVAILABILITY DATE" means the 45th day after the end of the
fourth fiscal quarter following the fiscal quarter that includes such Effective
Date, except that, if such fourth fiscal quarter is the last quarter of the
Company's fiscal year, "AVAILABILITY DATE" means the 90th day after the end of
such fourth fiscal quarter.
(f) The Company will furnish to the Representatives copies of each
Registration Statement (one of which will be signed and will include all
exhibits), each related preliminary prospectus, and, so long as a prospectus
relating to the Offered Securities is required to be delivered under the Act in
20
connection with sales by any Underwriter or dealer, the Prospectus and all
amendments and supplements to such documents, in each case in such quantities as
the Representatives request. The Prospectus shall be so furnished on or prior to
3:00 P.M., New York time, on the business day following the later of the
execution and delivery of this Agreement or the Effective Time of the Initial
Registration Statement. All other such documents shall be so furnished as soon
as available. The Company will pay the expenses of printing and distributing to
the Underwriters all such documents.
(g) The Company will arrange for the qualification of the Offered
Securities for sale under the laws of such jurisdictions as the Representatives
designate and will continue such qualifications in effect so long as required
for the distribution.
(h) For the period specified below (the "LOCK-UP PERIOD"), the
Company will not offer, sell, contract to sell, pledge or otherwise dispose of,
directly or indirectly, or file with the Commission a registration statement
under the Act relating to, any additional shares of its Securities or securities
convertible into or exchangeable or exercisable for any shares of its
Securities, or publicly disclose the intention to make any such offer, sale,
pledge, disposition or filing, without the prior written consent of the
Representatives. The initial Lock-Up Period will commence on the date hereof and
will continue and include the date 180 days after the date hereof or such
earlier date that the Representatives consent to in writing; provided, however,
that if (1) during the last 17 days of the initial Lock-Up Period, the Company
releases earnings results or material news or a material event relating to the
Company occurs or (2) prior to the expiration of the initial Lock-Up period, the
Company announces that it will release earnings results during the 16-day period
beginning on the last day of the initial Lock-Up Period, then in each case the
Lock-Up Period will be extended until the expiration of the 18-day period
beginning on the date of release of the earnings results or the occurrence of
the material news or material event, as applicable, unless the Representatives
waive, in writing, such extension. The Company will provide the Representatives
with notice of any announcement described in clause (2) of the preceding
sentence that gives rise to an extension of the Lock-Up Period. The provisions
of this subsection (h) shall not apply to (A) the Offered Securities to be sold
hereunder, (B) the registration of shares of capital stock in accordance with
the terms of the Registration Rights Agreement and (C) issuances of shares of
restricted stock, stock options and other awards and the issuance of shares
underlying such awards under the Resource Capital Corp. Stock Incentive Plan
(the "INCENTIVE PLAN"), as each of (A) through (C) above is described in the
Prospectus.
(i) The Company agrees with the several Underwriters that the
Company will pay all expenses incident to the performance of its obligations
under this Agreement, for any filing fees, taxes and other expenses (including
fees and disbursements of its counsel) in connection with (i) the preparation of
the preliminary prospectus and the Prospectus, and any amendments or supplements
thereto, and the printing and furnishing of copies of each thereof to the
Underwriters (including costs of mailing and shipment), (ii) the preparation,
issuance, sale and delivery of the Offered Securities, including any stock or
other transfer taxes or duties payable upon the sale of the Offered Securities
to the Underwriters, (iii) the qualification of the Offered Securities for
offering and sale under state laws and the determination of their eligibility
for investment under state law as aforesaid (including any filing fees and the
reasonable legal fees and filing fees and other disbursements of counsel for the
Underwriters solely with respect to blue sky matters) and the printing and
furnishing of copies of any blue sky surveys or legal investment surveys to the
Underwriters and to dealers, (iv) for the filing fee incident to the review by
the NASD of the Offered Securities, (v) the fees and expenses of any transfer
agent or registrar for the Offered Securities, (vi) for any travel expenses of
the Company's officers and employees and any other expenses of the Company in
connection with attending or hosting meetings with prospective purchasers of the
Offered Securities, including the cost of any aircraft chartered in connection
with attending or hosting such meetings, and (vii) for expenses incurred for
preparing, printing and distributing any Issuer Free Writing Prospectuses to
investors or prospective investors.
21
(j) Each Selling Stockholder agrees to pay its proportionate share
of all discounts and commissions payable to the Underwriters, all transfer taxes
and fees with respect to the sale of its Resale Securities, and any other
expenses not specifically allocated to the Company pursuant to the Registration
Statement or this Agreement, except that the Selling Stockholder shall not be
liable for any expenses of the Underwriters. Each Selling Stockholder agrees
during the Selling Stockholder Lock-Up Period (as defined below) not to offer,
sell, contract to sell, pledge or otherwise dispose of, directly or indirectly,
any additional Securities or securities convertible into or exchangeable or
exercisable for any Securities, enter into a transaction which would have the
same effect, or enter into any swap, hedge or other arrangement that transfers,
in whole or in part, any of the economic consequences of ownership of the
Securities, whether any such aforementioned transaction is to be settled by
delivery of the Securities or such other securities, in cash or otherwise, or
publicly disclose the intention to make any such offer, sale, pledge or
disposition, or enter into any such transaction, swap, hedge or other
arrangement, without, in each case, the prior written consent of the
Representatives. The Selling Stockholder Lock-Up Period will commence on the
date hereof and will continue and include the date 60 days after the date hereof
or such earlier date that the Representatives consent to in writing; provided,
however, that if (1) during the last 17 days of the initial Lock-Up Period, the
Company releases earnings results or material news or a material event relating
to the Company occurs or (2) prior to the expiration of the Selling Stockholder
Lock-up Period, the company announces that it will release earnings results
during the 16-day period beginning on the last day of the initial Lock-Up
Period, then in each case the Lock-Up Period will be extended until the
expiration of the 18 day period beginning on the date of release of the earnings
results or the occurrence of the material news or material event, as applicable,
unless the Representatives waive, in writing, such extension.
(k) The Company agrees to furnish to the Underwriters for a period
of two (2) years from the First Closing Date (if such reports are not available
to the public electronically on the SEC's website) (i) copies of all annual,
quarterly and current reports of the Company (if such reports are not available
to the public electronically on the SEC's website) and (ii) such other material
reports and documents of the Company as the Underwriters may reasonably request;
provided, however, that the Company shall have no obligation under clause (ii)
for so long as the Company is subject to Sections 13 or 15(d) of the Exchange
Act.
(l) The Company's board of directors shall be comprised of a
majority of independent directors, as such term is defined under the rules and
regulations of the NYSE and the SEC, at the First Closing Date.
(m) The Company and the Manager agree to make all necessary filings
required under any federal, state, local or foreign law, regulation or rule and
obtain and maintain all necessary licenses, authorizations, consents and
approvals from other persons, required in order to conduct its proposed business
as described in the Prospectus, except when the failure to make a necessary
filing or to maintain a license, authorization, consent or approval could not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.
(n) The Company will use its best efforts to meet the requirements
to qualify, for its taxable year ending December 31, 2005 and thereafter, for
taxation as a REIT under the Code.
(o) The Company will use its best efforts to effect the listing of
the Offered Securities on the NYSE.
(p) The Company will apply the net proceeds from the sale of the
Offered Securities in the manner set forth under the caption "Use of Proceeds"
in the Prospectus.
22
(q) The Company will use its commercially reasonable efforts in
cooperation with the Representatives to obtain permission for the Offered
Securities to be eligible for clearance and settlement through DTC.
(r) The Company will use its best efforts to conduct its affairs in
such a manner so as not to become required to register as an investment company
under the Investment Company Act of 1940, as amended.
(s) The Company will not take any action prohibited by Rules 101 or
102 of Regulation M under the Act in connection with the distribution of the
Offered Securities contemplated hereby.
(t) The Company shall maintain a transfer agent and registrar for
the Securities.
6. Free Writing Prospectuses. (a) The Company represents and agrees
that, unless it obtains the prior consent of CSS, and each Underwriter
represents and agrees that, unless it obtains the prior consent of the Company
and CSS, it has not made and will not make any offer relating to the Offered
Securities that would constitute an Issuer Free Writing Prospectus, or that
would otherwise constitute a "free writing prospectus," as defined in Rule 405,
required to be filed with the Commission. Any such free writing prospectus
consented to by the Company and CSS is hereinafter referred to as a "Permitted
Free Writing Prospectus." The Company represents that it has treated and agrees
that it will treat each Permitted Free Writing Prospectus as an "issuer free
writing prospectus," as defined in Rule 433, and has complied and will company
with requirements of Rule 433 applicable to any Permitted Free Writing
Prospectus, including timely Commission filing where required, legending and
record keeping. The Company represents that it has satisfied and agrees that it
will satisfy the conditions in Rule 433 to avoid a requirement to file with the
Commission any electronic road show.
(b) The Company will prepare a final term sheet relating to the
Offered Securities containing only information that describes the final terms of
the Offered Securities and otherwise in a form consented to by CSS, and will
file such final term sheet within the period required by Rule 433(d)(5)(ii)
following the date such final terms have been established for all classes of the
offering of the Offered Securities. Any such final term sheet is an Issuer Free
Writing Prospectus and a Permitted Free Writing Prospectus for purposes of this
Agreement. The Company consents to the use by any Underwriter of a free writing
prospectus that contains only (a)(i) information describing the preliminary
terms of the Offered Securities or their offering or (ii) information that
describes the final terms of the Offered Securities or their offering and that
is included in the final term sheet of the Company contemplated in the first
sentence of this subsection or (b) other information that is not "issuer
information," as defined in Rule 433.
7. Conditions of the Obligations of the Underwriters. The obligations
of the several Underwriters to purchase and pay for the Firm Securities on the
First Closing Date and the Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company and the Selling Stockholders herein, to
the accuracy of the statements of Company officers made pursuant to the
provisions hereof, to the performance by the Company and the Selling
Stockholders of their obligations hereunder and to the following additional
conditions precedent:
(a) The Representatives shall have received a letter (including an
"agreed-upon procedures" letter), dated the date of delivery thereof (which, if
the Effective Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement, shall be on or prior to the date of
this Agreement or, if the Effective Time of the Initial Registration Statement
is subsequent to the execution and delivery of this Agreement, shall be prior to
23
the filing of the amendment or post-effective amendment to the registration
statement to be filed shortly prior to such Effective Time), of Xxxxx Xxxxxxxx
LLP, in form and substance reasonably satisfactory to the Representatives,
confirming that they are an independent registered public accounting firm within
the meaning of the Act and the applicable published Rules and Regulations
thereunder and the rules and regulations of the PCAOB and containing statements
and information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and certain
financial information contained in the Registration Statements, the General
Disclosure Package, each Statutory Prospectus and each Issuer Free Writing
Prospectus (other than any Issuer Free Writing Prospectus that is an "electronic
road show," as defined in Rule 433(h)).
For purposes of this subsection, (i) if the Effective Time of the
Initial Registration Statements is subsequent to the execution and delivery of
this Agreement, "REGISTRATION STATEMENTS" shall mean the Initial Registration
Statement as proposed to be amended by the amendment or post-effective amendment
to be filed shortly prior to its Effective Time, (ii) if the Effective Time of
the Initial Registration Statements is prior to the execution and delivery of
this Agreement but the Effective Time of the Additional Registration Statement
is subsequent to such execution and delivery, "REGISTRATION STATEMENTS" shall
mean the Initial Registration Statement and the Additional Registration
Statement as proposed to be filed or as proposed to be amended by the
post-effective amendment to be filed shortly prior to its Effective Time, and
(iii) "PROSPECTUS" shall mean the prospectus included in the Registration
Statements.
(b) If the Effective Time of the Initial Registration Statement is
not prior to the execution and delivery of this Agreement, such Effective Time
shall have occurred not later than 10:00 P.M., New York time, on the date of
this Agreement or such later date as shall have been consented to by the
Representatives. If the Effective Time of the Additional Registration Statement
(if any) is not prior to the execution and delivery of this Agreement, such
Effective Time shall have occurred not later than 10:00 P.M., New York time, on
the date of this Agreement or, if earlier, the time the Prospectus is printed
and distributed to any Underwriter, or shall have occurred at such later date as
shall have been consented to by the Representatives. If the Effective Time of
the Initial Registration Statement is prior to the execution and delivery of
this Agreement, the Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 5(a) of this Agreement.
Prior to such Closing Date, no stop order suspending the effectiveness of a
Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or, to the knowledge of any Selling
Stockholder, the Company or the Representatives, shall be contemplated by the
Commission nor shall there be any suspension of the qualification of the Offered
Securities for sale in any jurisdiction or institution or threatening of any
proceeding for such purpose.
(c) Subsequent to the execution and delivery of this Agreement there
shall not have occurred (i) any change, or any development or event involving a
prospective change, in the condition (financial or other), business, earnings,
properties, results of operations (as described in the Prospectus), assets or
prospects of the Company and the Subsidiaries taken as one enterprise which, in
the judgment of a majority in interest of the Underwriters including the
Representatives, is material and adverse and makes it impractical or inadvisable
to proceed with completion of the public offering or the sale of and payment for
the Offered Securities; (ii) any downgrading in the rating of any debt
securities or preferred stock of the Company by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g) under
the Act), or any public announcement that any such organization has under
surveillance or review its rating of any debt securities or preferred stock of
the Company (other than an announcement with positive implications of a possible
upgrading, and no implication of a possible downgrading, of such rating); (iii)
any change in U.S. or international financial, political or economic conditions
or currency exchange rates or exchange controls as would, in the judgment of a
24
majority in interest of the Underwriters including the Representatives, be
likely to prejudice materially the success of the proposed issue, sale or
distribution of the Offered Securities, whether in the primary market or in
respect of dealings in the secondary market; (iv) any material suspension or
material limitation of trading in securities generally on the NYSE, or any
setting of minimum prices for trading on such exchange; (v) or any suspension of
trading of any securities of the Company on any exchange or in the
over-the-counter market; (vi) any banking moratorium declared by U.S. Federal or
New York authorities; (vii) any major disruption of settlements of securities or
clearance services in the United States or (viii) any attack on, outbreak or
escalation of hostilities or act of terrorism involving the United States, any
declaration of war by Congress or any other national or international calamity
or emergency if, in the judgment of a majority in interest of the Underwriters
including the Representatives, the effect of any such attack, outbreak,
escalation, act, declaration, calamity or emergency makes it impractical or
inadvisable to proceed with completion of the public offering or the sale of and
payment for the Offered Securities.
(d) The Representatives shall have received an opinion, dated such
Closing Date, of Ledgewood, counsel for the Company, in the form reasonably
satisfactory to the representatives as set forth on EXHIBIT A hereto. In
rendering such opinion, Ledgewood may rely as to the incorporation of the
Company and all other matters governed by Maryland law upon the opinion of DLA
Xxxxx Xxxxxxx Xxxx Xxxx US LLP.
(e) The Representatives shall have received (i) an opinion, dated
such Closing Date, of Ledgewood, for the benefit of the Selling Stockholders who
are natural persons in a form reasonably satisfactory to the Representatives as
set forth on EXHIBIT B-1 hereto and (ii) an opinion, on or prior to the First
Closing Date, of counsel to each Selling Stockholder that is not a natural
person in a form reasonably satisfactory to the Representatives with respect to
the matters set forth on EXHIBIT B-2 hereto.
(f) The Representatives shall have received an opinion, dated such
Closing Date, of DLA Xxxxx Xxxxxxx Xxxx Xxxx US LLP, special Maryland counsel
for the Company, in the form reasonably satisfactory to the Representatives as
set forth on EXHIBIT C hereto.
(g) The Representatives shall have received a tax opinion, dated
such Closing Date, of Ledgewood, counsel for the Company, in the form reasonably
satisfactory to the representatives as set forth on EXHIBIT D hereto.
(h) The Representatives shall have received from Xxxxxxxx Chance US
LLP, counsel for the Underwriters, such opinion or opinions, dated such Closing
Date, with respect to the incorporation of the Company, the validity of the
Offered Securities delivered on such Closing Date, the Registration Statements,
the Prospectus and other related matters as the Representatives may require, and
the Selling Stockholders and the Company shall have furnished to such counsel
such documents as they request for the purpose of enabling them to pass upon
such matters. In rendering such opinion, Xxxxxxxx Chance US LLP may rely as to
the incorporation of the Company and all other matters governed by Maryland law
upon the opinion of DLA Xxxxx Xxxxxxx Xxxx Xxxx US LLP referred to above.
(i) The Representatives shall have received a certificate, dated
such Closing Date, of the Chief Executive Officer or President and a principal
financial or accounting officer of the Company in which such officers, to the
best of their knowledge after reasonable investigation, shall state that: (i)
the representations and warranties of the Company and the Manager in this
Agreement are true and correct; (ii) the Company and the Manager have complied
with all agreements and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to such Closing Date; (iii) no stop order
suspending the effectiveness of any Registration Statement has been issued and
no proceedings for that purpose have been instituted or are contemplated by the
Commission; (iv) the Additional Registration Statement (if any) satisfying the
requirements of subparagraphs (1) and (3) of Rule 462(b) was filed pursuant to
25
Rule 462(b), including payment of the applicable filing fee in accordance with
Rule 111(a) or (b) under the Act, prior to the time the Prospectus was printed
and distributed to any Underwriter; and (v) subsequent to the respective dates
of the most recent financial statements in the Prospectus, there has been no
Material Adverse Effect except as set forth in the Prospectus or as described in
such certificate. In addition to the matters set forth in this subsection (i),
the certificate shall also address certain matters, representations, warranties,
covenants agreements and conditions addressed in this Agreement or as may be
reasonably requested.
(j) The Representatives shall have received a letter (including an
"agreed-upon procedures" letter), dated such Closing Date, of Xxxxx Xxxxxxxx LLP
which meets the requirements of subsection (a) of this Section, except that the
specified date referred to in such subsection will be a date not more than three
days prior to such Closing Date for the purposes of this subsection.
(k) On or prior to the date of this Agreement, the Representatives
shall have received lock-up letters in substantially the form attached hereto as
EXHIBIT E from each of the executive officers and directors of the Company,
members of the Company's investment committee, the Manager, and Resource
America.
(l) The Custodian will deliver to CSS a letter stating that they
will deliver to each Selling Stockholder a United States Treasury Department
Form 1099 (or other applicable form or statement specified by the United States
Treasury Department regulations in lieu thereof) on or before January 31 of the
year following the date of this Agreement.
(m) On each Closing Date, the Representatives shall have received a
certificate of an attorney-in-fact designated in the Power of Attorney on behalf
of such Selling Stockholder, dated as of the First Closing Date, to the effect
that (i) the representations and warranties of such Selling Stockholder
contained in Section 2(c) hereof are true and correct in all respects with the
same force and effect as though expressly made at and as of each Closing Date
and (ii) such Selling Stockholder has complied in all material respects with all
agreements and all conditions on its part to be performed under this Agreement
at or prior to each Closing Date.
(n) The NASD shall have confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(o) The Offered Securities shall have been approved for listing on
the NYSE, subject only to official notice of issuance.
(p) The Company shall have furnished to the Representatives at the
First Closing Date and each Optional Closing Date (if any) such further
customary information, opinions, certificates, letters and documents as the
Representatives may reasonably request.
The Selling Stockholders and the Company will furnish the
Representatives with such conformed copies of such opinions, certificates,
letters and documents as the Representatives reasonably request. The
Representatives may in its sole discretion waive on behalf of the Underwriters
compliance with any conditions to the obligations of the Underwriters hereunder,
whether in respect of an Optional Closing Date or otherwise.
8. Indemnification and Contribution. (a) The Company and the Manager,
joint and severally, will indemnify and hold harmless each Underwriter, its
partners, members, directors officers and its affiliates and each person, if any
who controls such Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, against any losses, claims, damages or
26
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
breach of any of the representations and warranties of the Company or the
Manager contained herein or any untrue statement or alleged untrue statement of
any material fact contained in any Registration Statement, each Statutory
Prospectus, the Prospectus, any Issuer Free Writing Prospectus, or any amendment
or supplement thereto, or any related preliminary prospectus, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Company and the Manager will not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
in or omission or alleged omission from any of such documents in reliance upon
and in conformity with written information furnished to the Company by any
Underwriter through the Representatives specifically for use therein, it being
understood and agreed that the only such information furnished by any
Underwriter consists of the information described as such in subsection (c)
below; and provided, further that with respect to any untrue statement or
alleged untrue statement in or omission or alleged omission from any preliminary
prospectus the indemnity agreement contained in this subsection (a) shall not
inure to the benefit of any Underwriter from whom the person asserting any such
losses, claims, damages or liabilities purchased the Offered Securities
concerned, to the extent that a prospectus relating to such Offered Securities
was required to be delivered by such Underwriter under the Act in connection
with such purchase and any such loss, claim, damage or liability such
Underwriter results from the fact that there was not sent or given to such
person, at or prior to the written confirmation of the sale of such Offered
Securities to such person, a copy of the Prospectus if the Company had
previously furnished copies thereof to such Underwriter.
The Company and the Selling Stockholders also agree to severally and
not jointly indemnify and hold harmless, X.X. Xxxxxx Securities Inc.
("JPMorgan"), its affiliates, directors and officers and each person, if any,
who controls JPMorgan within the meaning of Section 15 of the Act or Section 20
of the Exchange Act, from and against any and all losses, claims, damages and
liabilities incurred as a result of JPMorgan's participation as a "qualified
independent underwriter" within the meaning of the Rules of Conduct of the NASD
in connection with the offering of the Offered Securities; provided, however,
that each Selling Stockholder shall only be subject to liability under this
paragraph to the extent such liability arises out of or is based upon any untrue
statement or alleged untrue statement or upon an omission or alleged omission
based upon information provided by such Selling Stockholder or contained in a
representation or warranty given by such Selling Stockholder in this Agreement
or the Custody Agreement; and provided, further, that the liability under this
paragraph of each Selling Stockholder shall be limited to an amount equal to the
aggregate gross proceeds to such Selling Stockholder from the sale of the
Offered Securities sold by such Selling Stockholder hereunder.
(b) The Selling Stockholders, jointly and severally, will indemnify
and hold harmless each Underwriter, its partners, members, directors officers
and its affiliates and each person who controls such Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, against any
losses, claims, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any Registration Statement, each Statutory
Prospectus, the Prospectus, any Issuer Free Writing Prospectus, or any amendment
or supplement thereto, or any related preliminary prospectus, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
27
defending any such loss, claim, damage, liability or action as such expenses are
incurred; but only insofar as any such loss, claim, damage or liability arise
out of or is based upon any untrue statement or alleged untrue statement or
omission or alleged omission of a material fact contained in and in conformity
with information furnished in writing by such Selling Stockholder to the Company
for use in the Registration Statement or the Prospectus; provided, however, that
the Selling Stockholders will not be liable in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity with written
information furnished to the Company by an Underwriter through the
Representatives specifically for use therein, it being understood and agreed
that the only such information furnished by any Underwriter consists of the
information described as such in subsection (c) below.
(c) Each Underwriter will severally and not jointly indemnify and
hold harmless the Company and the Manager, and their directors and officers and
each person, if any, who controls the Company and the Manager within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, and each Selling
Stockholder against any losses, claims, damages or liabilities to which the
Company, the Manager or such Selling Stockholder may become subject, under the
Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact contained in any Registration
Statement, each Statutory Prospectus, the Prospectus, any Issuer Free Writing
Prospectus, or any amendment or supplement thereto, or any related preliminary
prospectus, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through the Representatives specifically for use therein, and will reimburse any
legal or other expenses reasonably incurred by the Company, the Manager, and
each Selling Stockholder in connection with investigating or defending any such
loss, claim, damage, liability or action as such expenses are incurred, it being
understood and agreed that the only such information furnished by any
Underwriter consists of the following information in the Prospectus furnished on
behalf of each Underwriter: the information contained in the fourth, fifteenth
and sixteenth paragraphs under the caption "Underwriting."
(d) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying party
under subsection (a), (b) or (c) above, notify the indemnifying party of the
commencement thereof; but the failure to notify the indemnifying party shall not
relieve it from any liability that it may have under subsection (a), (b) or (c)
above except to the extent that it has been materially prejudiced by such
failure; and provided further that the failure to notify the indemnifying party
shall not relieve it from any liability that it may have to an indemnified party
otherwise than under subsection (a), (b) or (c) above. In case any such action
is brought against any indemnified party and it notifies an indemnifying party
of the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under this Section, as the case may be, for any
legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation. Notwithstanding anything contained herein to the contrary, if
indemnity may be sought pursuant to the second paragraph of Section 8(a) above
in respect of such proceeding, then in addition to such separate firm of the
Underwriters, their affiliates and such control persons of the Underwriters the
indemnifying party shall be liable for the fees and expenses of not more than
28
one separate firm (in addition to any local counsel) for JPMorgan in its
capacity as a as a "qualified independent underwriter," its affiliates and all
persons, if any, who control JPMorgan within the meaning of either Section 15 of
the Act or Section 20 of the Exchange Act. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement of any
pending or threatened action 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 (i) settlement includes an unconditional release
of such indemnified party from all liability on any claims that are the subject
matter of such action and (ii) does not include a statement as to, or an
admission of, fault, culpability or a failure to act by or on behalf of an
indemnified party.
(e) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) above, then each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a), (b) or (c)
above (i) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Selling Stockholders on the one hand and the
Underwriters or JPMorgan in its capacity as a "qualified independent
underwriter," as the case may be, on the other from the offering of the
Securities 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 and the Selling Stockholders on the one hand and the
Underwriters or JPMorgan in its capacity as a "qualified independent
underwriter," as the case may be, on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities as
well as any other relevant equitable considerations. The relative benefits
received by the Company and the Selling Stockholders on the one hand and the
Underwriters or JPMorgan in its capacity as a "qualified independent
underwriter," as the case may be, on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company and the Selling Stockholders bear to the total
underwriting discounts and commissions received by the Underwriters. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company, the Selling Stockholders or the Underwriters or JPMorgan in its
capacity as a "qualified independent underwriter," as the case may be, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid by an
indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (e) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any action or claim which is
the subject of this subsection (e). Notwithstanding the provisions of this
subsection (e), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations in this subsection (e) to contribute are several in
proportion to their respective underwriting obligations and not joint.
(f) The obligations of the Company, the Manager and the Selling
Stockholders under this Section shall be in addition to any liability which the
Company, the Manager and the Selling Stockholders may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Underwriter or JPMorgan in its capacity as a "qualified independent
underwriter," as the case may be, within the meaning of the Act; and the
obligations of the Underwriters under this Section shall be in addition to any
liability which the respective Underwriters may otherwise have and shall extend,
upon the same terms and conditions, to each director of the Company, to each
29
officer of the Company who has signed a Registration Statement and to each
person, if any, who controls the Company within the meaning of the Act or the
Exchange Act. The liability under this Section 8 of each Selling Stockholder
shall be limited to an amount equal to the aggregate gross proceeds to such
Selling Stockholder from the sale of Securities sold by such Selling Stockholder
hereunder.
9. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase Offered Securities hereunder on either the
First or any Optional Closing Date and the aggregate number of shares of Offered
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed 10% of the total number of shares of Offered Securities
that the Underwriters are obligated to purchase on such Closing Date, the
Representatives may make arrangements satisfactory to the Company and the
Selling Stockholders for the purchase of such Offered Securities by other
persons, including any of the Underwriters, but if no such arrangements are made
by such Closing Date, the non-defaulting Underwriters shall be obligated
severally, in proportion to their respective commitments hereunder, to purchase
the Offered Securities that such defaulting Underwriters agreed but failed to
purchase on such Closing Date. If any Underwriter or Underwriters so default and
the aggregate number of shares of Offered Securities with respect to which such
default or defaults occur exceeds 10% of the total number of shares of Offered
Securities that the Underwriters are obligated to purchase on such Closing Date
and arrangements satisfactory to the Representatives, the Company and the
Selling Stockholders for the purchase of such Offered Securities by other
persons are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Underwriter, the
Company or the Selling Stockholders, except as provided in Section 10 (provided
that if such default occurs with respect to Optional Securities after the First
Closing Date, this Agreement will not terminate as to the Firm Securities or any
Optional Securities purchased prior to such termination). As used in this
Agreement, the term "Underwriter" includes any person substituted for an
Underwriter under this Section 9. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
10. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Selling Stockholders, of the Company or its officers, of the Manager and of the
several Underwriters (including XX Xxxxxx in its capacity as a "qualified
independent underwriter") set forth in or made pursuant to this Agreement will
remain in full force and effect, regardless of any investigation, or statement
as to the results thereof, made by or on behalf of any Underwriter (including XX
Xxxxxx in its capacity as a "qualified independent underwriter"), any Selling
Stockholder, the Company, the Manager or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the Offered Securities. If this Agreement is
terminated pursuant to Section 9 or if for any reason the purchase of the
Offered Securities by the Underwriters is not consummated, the Company and the
Selling Stockholders shall remain responsible for the expenses to be paid or
reimbursed by them pursuant to Section 5(h) and the respective obligations of
the Company and the Selling Stockholders, and the Underwriters pursuant to
Section 8 shall remain in effect, and if any Offered Securities have been
purchased hereunder the representations and warranties in Section 2 and all
obligations under Section 5 shall also remain in effect. If the purchase of the
Offered Securities by the Underwriters is not consummated as a result of the
failure of any condition specified in Section 7 hereof, the Company and the
Selling Stockholders will, jointly and severally, reimburse the Underwriters for
all out-of-pocket expenses (including fees and disbursements of counsel)
reasonably incurred by them in connection with the offering of the Offered
Securities.
11. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to the Representatives, c/o Credit Suisse Securities (USA) LLC, Eleven Madison
Avenue, New York, N.Y. 10010-3629, Attention: Transactions Advisory Group, or,
if sent to the Company, will be mailed, delivered or telegraphed and confirmed
to it at 000 Xxxxx Xxxxxx, 00xx xxxxx, Xxx Xxxx, XX 00000, Attention: General
30
Counsel, or, if sent to the Selling Stockholders or any of them, will be mailed,
delivered or telegraphed and confirmed to Xxxxxxxx X. Xxxxx at Xxxxxx X.
Xxxxxxx; provided, however, that any notice to an Underwriter pursuant to
Section 8 will be mailed, delivered or telegraphed and confirmed to such
Underwriter.
12. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective personal representatives
and successors and the officers and directors and controlling persons referred
to in Section 8, and no other person will have any right or obligation
hereunder.
13. Representation. The Representatives will act for the several
Underwriters in connection with the transactions contemplated by this Agreement,
and any action under this Agreement taken by the Representatives jointly or by
CSS will be binding upon all the Underwriters. Xxxxxxxx X. Xxxxx/Xxxxxx X.
Xxxxxxx will act for the Selling Stockholders in connection with such
transactions, and any action under or in respect of this Agreement taken by
Xxxxxxxx X. Xxxxx/Xxxxxx X. Xxxxxxx will be binding upon all the Selling
Stockholders.
14. Absence of Fiduciary Relationship. The Company and the Selling
Stockholders acknowledge and agree that:
(a) the Representatives (including for all purposes in this Section
14 JPMorgan in its capacity as a "qualified independent underwriter"), on behalf
of the Underwriters, have been retained solely to act as underwriters in
connection with the sale of the Offered Securities and that no fiduciary,
advisory or agency relationship between the Company, the Selling Stockholders
and the Representatives have been created in respect of any of the transactions
contemplated by this Agreement, irrespective of whether the Representatives have
advised or are advising the Company and the Selling Stockholders on other
matters;
(b) the price of the Offered Securities set forth in this Agreement
was established by the Company and the Selling Stockholders following
discussions and arms-length negotiations with the Representatives, and the
Company and the Selling Stockholders are capable of evaluating and understanding
and understand and accept the terms, risks and conditions of the transactions
contemplated by this Agreement;
(c) they have been advised that the Representatives and their
affiliates are engaged in a broad range of transactions which may involve
interests that differ from those of the Company and the Selling Stockholders and
that the Representatives have no obligation to disclose such interests and
transactions to the Company and the Selling Stockholders by virtue of any
fiduciary, advisory or agency relationship; and
(d) they waive, to the fullest extent permitted by law, any claims
they may have against the Representatives, on behalf of themselves and the other
Underwriters, for breach of fiduciary duty or alleged breach of fiduciary duty
and agree that the Representatives, on behalf of themselves and the other
Underwriters, shall have no liability (whether direct or indirect) to the
Company and the Selling Stockholders in respect of such a fiduciary duty claim
or to any person asserting a fiduciary duty claim on behalf of or in right of
the Company, including stockholders, employees or creditors of the Company, and
the Selling Stockholders.
15. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
31
16. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
32
If the foregoing is in accordance with the Representatives'
understanding of our agreement, kindly sign and return to the Company and the
Manager, one of the counterparts hereof, whereupon it will become a binding
agreement among the Selling Stockholders, the Company and the several
Underwriters in accordance with its terms.
Very truly yours,
RESOURCE CAPITAL CORP.
By:
--------------------------------------------
Name:
Title:
RESOURCE CAPITAL MANAGER, INC.
By:
--------------------------------------------
Name:
Title:
Xxxxxxxx X. Xxxxx/Xxxxxx X. Xxxxxxx, as
attorney-in-fact for the Selling Stockholders
listed on Schedule A hereto
By:
--------------------------------------------
Name:
Title:
The foregoing Underwriting Agreement is
hereby confirmed and accepted as of the
date first above written.
CREDIT SUISSE SECURITIES (USA) LLC
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
CITIGROUP GLOBAL MARKETS INC.
X.X. XXXXXX SECURITIES INC.,
Acting on behalf of themselves and as
the Representatives of the several
Underwriters.
By: CREDIT SUISSE SECURITIES (USA) LLC
By:
--------------------------------
Name:
Title:
SCHEDULE A
NUMBER OF
NUMBER OF FIRM OPTIONAL
SECURITIES TO SECURITIES TO
SELLING STOCKHOLDER BE SOLD BE SOLD
---------------------------------- --------------- -----------------
--------------- -----------------
Total..........................
=============== =================
Sch. A-1
SCHEDULE B
NUMBER OF FIRM
SECURITIES TO BE
UNDERWRITER PURCHASED
---------------------------------------------------------------------------- -----------------
Credit Suisse Securities (USA) LLC..........................................
Friedman, Billings, Xxxxxx & Co., Inc. .....................................
Citigroup Global Markets Inc................................................
X.X. Xxxxxx Securities Inc..................................................
Bear, Xxxxxxx & Co. Inc.....................................................
Xxxxx Xxxxxxx & Co..........................................................
Flagstone Securities LLC....................................................
-----------------
Total..............................................................
=================
Sch. B-1
[FORM OF OPINION OF LEDGEWOOD LAW FIRM, P.C.]
EXHIBIT A
1. The Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction set forth on a schedule to
this opinion letter.
2. Each subsidiary set forth on a schedule to this opinion letter (each
a "Subsidiary") has been duly incorporated or formed and is validly existing as
a corporation or limited liability company in good standing under the laws of
the jurisdiction of its incorporation or formation, has corporate or other
requisite power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and is duly qualified as a
foreign corporation or limited liability company to transact business and is in
good standing in each jurisdiction set forth opposite their respective names on
a schedule to this opinion letter; all of the issued and outstanding capital
stock of each Subsidiary has been duly authorized and validly issued, is fully
paid and non-assessable and, to the best of such counsel's knowledge and
information, is owned by the Company, directly or through subsidiaries, free and
clear of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity and, to such counsel's knowledge, no options, warrants or other rights to
purchase, agreements or other obligations to issue or other rights to convert
any obligation into shares of capital stock or ownership interests in the
Subsidiaries are outstanding.
3. The Manager has been duly formed and is validly existing and in good
standing as a corporation under the laws of the State of Delaware and has full
corporate power and authority to conduct its business as described in the
Prospectus.
4. The Initial Registration Statement was declared effective under the
Act as of the date and time specified in such opinion, the Additional
Registration Statement (if any) was filed and became effective under the Act as
of the date and time (if determinable) specified in such opinion, the Prospectus
either was filed with the Commission pursuant to the subparagraph of Rule 424(b)
specified in such opinion on the date specified therein or was included in the
Initial Registration Statement or the Additional Registration Statement (as the
case may be), and, to the best of the knowledge of such counsel, no stop order
suspending the effectiveness of a Registration Statement or any part thereof has
been issued and no proceedings for that purpose have been instituted or are
pending or contemplated under the Act, and each Registration Statement and the
Prospectus (including the preliminary prospectus), and each amendment or
supplement thereto, as of their respective effective or issue dates, complied as
to form in all material respects with the requirements of the Act and the Rules
and Regulations.
5. Each of this Agreement, the Registration Rights Agreement and the
Management Agreement has been duly authorized, executed and delivered by the
Company and the Manager, as applicable, and constitute valid and legally binding
obligations of the Company and the Manager, as applicable, enforceable against
the Company and the Manager, as applicable, in accordance with their terms,
subject to the effect of bankruptcy, insolvency, reorganization, arrangement,
moratorium, preferential or fraudulent conveyance, or other similar laws or
equitable principles (regardless of whether enforcement is sought in a
proceeding at law or in equity) relating to or affecting the rights and remedies
of creditors generally and by general principles of equity.
6. The issue and sale of the Original Issue Securities by the Company
and the execution, delivery and performance by the Company and the Manager of
this Agreement and the consummation of the transactions contemplated herein
Exh. A-1
(including the use of the proceeds from the sale of the Original Issue
Securities as described in the Prospectus under the caption "Use of Proceeds")
and compliance by the Company and the Manager with its obligations under this
Agreement do not and will not, whether with or without the giving of notice of
lapse of time or both (i) breach or result in a default under any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument
identified on the annexed schedule furnished to us by the Company and the
Manager, (ii) violate any federal or Pennsylvania or Delaware statute or any
rule or regulation that has been issued pursuant to any federal or Pennsylvania
or Delaware statute or any order known to us issued pursuant to any federal or
Pennsylvania or Delaware statute by any court or governmental agency or body
having jurisdiction over the Company and the Manager or any of its subsidiaries
or any of their properties or (iii) result in the creation or imposition of any
lien, encumbrance, charge or claim upon any property or assets of the Company
and the Manager under any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument identified on the annexed schedule furnished to us
by the Company and the Manager.
7. No order, consent, permit, approval, authorization, registration or
qualification of or filing with any federal or governmental agency or body or,
to our knowledge, any federal or state court is required on the part of the
Company and the Manager for the execution, delivery and performance by the
Company and the Manager of their obligations under this Agreement and the Power
of Attorney and Custody Agreement, as applicable, or the consummation by the
Company and the Manager of the transactions contemplated thereby, including
without limitation, the issuance, sale and delivery of Original Issue Securities
by the Company, other than (a) any regulatory filings, consents or approvals
made, required to be made, obtained or required to be obtained so that the
Company, the Subsidiaries and the Manager will be duly licensed to conduct their
business as described in the Prospectus and (b) those that have been obtained
and made under the Act and those as may be required under state securities laws.
8. To the best of our knowledge, neither the Company, the Subsidiaries,
nor the Manager is in breach or violation of or in default under (nor has any
event occurred which with notice, lapse of time, or both would result in any
breach of, or constitute a default under, or give the holder of any indebtedness
(or a person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a part of such indebtedness under)
(1) its respective charter or by-laws, (2) any provisions of any agreement
attached on a schedule to this opinion letter, or (3) any federal, state, local
or foreign law, regulation or rule or any decree, judgment or order applicable
to the Company, the Subsidiaries or the Manager.
9. The statements under the captions "Management's Discussion and
Analysis of Financial Condition and Results of Operations - Contractual
Obligations and Commitments and - Off-Balance Sheet Arrangements," "Business -
Our Financing Strategy and - Legal Proceedings," "Management - Management
Agreement, - 2005 Stock Incentive Plan, - Conflicts of Interest in Our
Relationship with Resource Capital and Resource America and - Resolution of
Potential Conflicts of Interest in Allocation of Investment Opportunities"
"Certain Relationships and Related Transactions" and "Description of Capital
Stock - Registration Rights" in the Prospectus, insofar as such statements
constitute summaries of certain terms and documents referred to therein,
constitute fair summaries thereof in all material respects.
10. To the best of our knowledge, there are no contracts or agreements
between the Company and any person granting such person the right to require the
Company or the Subsidiaries to include any securities of the Company owned or to
be owned by such person in the securities registered pursuant to a registration
statement, except such rights as are provided under the Registration Rights
Agreement and the Management Agreement.
11. The Company is not required, and upon the issuance and sale of the
Original Issue Securities as herein contemplated and the application of the net
proceeds therefrom as described in the Prospectus will not be required to,
register as "investment company" or an "entity controlled" by an "investment
company" under the 1940 Act.
Exh. A-2
12. To the best of our knowledge, there is not pending or, to the best
of our knowledge, threatened any action, suit, proceeding, inquiry or
investigation, to which the Company, the Manager or any Subsidiary or any of
their respective officers or directors is a party, or to which the property of
the Company, the Manager or any Subsidiary thereof is subject, before or brought
by any court or governmental agency or body, which would reasonably be expected
to result in a Material Adverse Effect, or which would reasonably be expected to
materially and adversely affect the properties or assets thereof or the
consummation of the transactions contemplated in this Agreement or the
performance by the Company or the Manager of its obligations thereunder or the
transactions contemplated by the Prospectus.
13. All descriptions in the Prospectus of contracts and other documents
to which the Company, the Manager or any Subsidiary are a party are accurate in
all material respects; to the best of our knowledge, there are no affiliate
transactions, off-balance sheet transactions, franchises, contracts, licenses,
leases, indentures, mortgages, loan agreements, notes, leases or other
instruments that would be required to be described or referred to in the
Prospectus that are not described or referred to in the Prospectus other than
those described or referred to therein or incorporated by reference thereto, and
the descriptions thereof or references thereto are correct in all material
respects.
Such counsel shall state that such counsel has participated in
conferences with officers and other representatives of the Company,
representatives of the Underwriters and representatives of the independent
certified public accountants of the Company, at which conferences the contents
of the Registration Statement, the Prospectus and the General Disclosure Package
and related matters were discussed and, although such counsel is not passing
upon and does not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement, the
Prospectus and the General Disclosure Package, such counsel shall advise you
that no facts have come to its attention which lead such counsel to believe that
(i) on the Effective Date and as of the date of this Agreement, the Registration
Statement or the General Disclosure Package or any amendment thereto (except
with respect to the financial statements and related notes and schedules and
other financial data derived therefrom included therein or omitted therefrom, as
to which such counsel need not express any belief), contained any 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, (ii)
at the date of the Prospectus, at the date of any amended or supplemented
Prospectus, as of the date of this Agreement or at the Closing Date, the
Prospectus or any amendment or supplement thereto (except with respect to the
financial statements and related notes and schedules and other financial data
derived therefrom included therein or omitted therefrom, as to which such
counsel need not express any belief), contained or contains any untrue statement
of a material fact or omitted or omits to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading or (iii) the General Disclosure Package, as
of the Applicable Time (except with respect to the financial statements and
related notes and schedules and other financial data derived therefrom included
therein or omitted therefrom, as to which such counsel need not express any
belief), contained or contains any untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
Exh. A-3
[FORM OF OPINION OF INDIVIDUAL SELLING STOCKHOLDER]
EXHIBIT B-1
Assuming (a) the Underwriters do not have notice of any "adverse claim"
(within the meaning of the NYUCC) with respect to the Selling Stockholder Shares
and (b) payment is made for the Selling Stockholder Shares by the Underwriters
in accordance with the Underwriting Agreement, then, upon indication by book
entry that the Selling Stockholder Shares have been credited by the Securities
Intermediary to a Securities Account of the Lead Underwriter at DTC, then the
Lead Underwriter will acquire a "securities entitlement" (within the meaning of
the NYUCC) in the Selling Stockholder Shares (the "Security Entitlement"), free
from any "adverse claim" (within the meaning of the NYUCC) against such Security
Entitlement, whether framed in conversion, replevin, constructive trust,
equitable lien or other theory.
Xxx. X-0-0
[FORM OF OPINION OF INSTITUTIONAL SELLING STOCKHOLDER]
EXHIBIT B-2
1. Each Selling Stockholder had valid and unencumbered title to the
Firm Securities delivered by such Selling Stockholder on such Closing Date and
had full right, power and authority to sell, assign, transfer and deliver the
Firm Securities delivered by such Selling Stockholder on such Closing Date
hereunder; and the several Underwriters have acquired valid and unencumbered
title to the Firm Securities purchased by them from the Selling Stockholders on
such Closing Date hereunder.
2. No consent, approval, authorization or order of, or filing with, any
governmental agency or body or any court is required to be obtained or made by
any Selling Stockholder for the consummation of the transactions contemplated by
the Power of Attorney and Custody Agreement or this Agreement in connection with
the sale of the Firm Securities sold by the Selling Stockholders, except such as
have been obtained and made under the Act and such as may be required under
state securities laws.
3. The execution, delivery and performance of the Power of Attorney and
Custody Agreement and this Agreement and the consummation of the transactions
therein and herein contemplated will not result in a breach or violation of any
of the terms and provisions of, or constitute a default under, any statute, any
rule, regulation or order of any governmental agency or body or any court having
jurisdiction over any Selling Stockholder or any of their properties or any
agreement or instrument to which any Selling Stockholder is a party or by which
any Selling Stockholder is bound or to which any of the properties of any
Selling Stockholder is subject, or the charter or by-laws of any Selling
Stockholder which is a corporation.
4. The Power of Attorney and Custody Agreement with respect to each
Selling Stockholder have been duly authorized, executed and delivered by such
Selling Stockholder and constitute valid and legally binding obligations of such
Selling Stockholder enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general equity principles.
5. This Agreement has been duly authorized, executed and delivered by
each Selling Stockholder.
Xxx. X-0-0
[FORM OF OPINION OF DLA XXXXX XXXXXXX XXXX XXXX US LLP]
EXHIBIT C
1. The Company is a corporation duly incorporated and existing under
and by virtue of the laws of the State of Maryland and is in good standing with
the State Department of Assessments and Taxation of Maryland.
2. The Company has the corporate power to own, lease or operate its
properties and to conduct its business substantially as described in the
Prospectus under the caption "Business." The Company has the corporate power to
execute and deliver this Agreement and to perform its obligations thereunder.
3. The Company has the number of authorized and, prior to issuance of
Original Issue Securities, issued and outstanding shares of stock as set forth
in the Prospectus under the caption "Capitalization." The outstanding shares of
stock of the Company (immediately prior to the issuance of the Original Issue
Securities) have been duly authorized and are validly issued, fully paid and
nonassessable and are not subject to any statutory preemptive rights under the
Maryland General Corporation Law (the "MGCL"), or the charter or bylaws of the
Company (the "Company Charter Documents").
4. The Original Issue Securities have been duly authorized for issuance
and sale to the Underwriters pursuant to the Underwriting Agreement and, when
issued and delivered by the Company, in the manner provided for in the
resolutions of the Board of Directors authorizing the sale and issuance of the
Original Issue Securities and in the Underwriting Agreement and against payment
of the purchase price set forth therein, the Original Issue Securities will be
validly issued, fully paid and nonassessable and will not be subject to any
statutory preemptive rights arising under the MGCL or the Company Charter
Documents.
5. The statements under the captions "Risk Factors - Risks Related to
our Organization and Structure," "Management - Indemnification and Limitation of
Liability; Insurance," "Description of Capital Stock" and "Certain Provisions of
the Maryland General Corporation Law and Our Charter and Bylaws" in the
Prospectus, insofar as such statements constitute summaries of the Company
Charter Documents or of Maryland law, constitute fair summaries thereof in all
material respects.
6. This Agreement has been duly authorized, executed and, so far as is
known to such counsel, delivered by the Company.
7. The form of certificate representing the Offered Securities complies
in all material respects with the applicable requirements of the MGCL, the
Company Charter Documents and no personal liability will attach to the holders
of the Offered Securities for any debt or obligation of the Company solely as a
result of their status as stockholders of the Company. The Offered Securities
conform in all material respects to the description thereof contained in the
Prospectus under the caption "Description of Capital Stock."
Exh. C-1
8. No consent, approval, authorization or order of, or qualification or
filing with, any governmental agency or authority of the State of Maryland
(other than as may be required under the securities laws of the State of
Maryland, as to which no opinion is hereby expressed) is required to be obtained
or made by the Company in connection with the transactions contemplated under
this Agreement, except for such as have been obtained or waived, if any.
9. The execution, delivery and performance of this Agreement, and the
consummation of the transactions contemplated thereunder, do not and will not
result in any breach of (i) any provisions of the Company Charter Documents or
(ii) any Maryland law or regulation or, so far as is known to such counsel, any
order, judgment, writ or decree of any Maryland governmental authority (other
than any order, judgment, writ or decree in connection with the securities laws
of the State of Maryland, as to which no opinion is hereby expressed) applicable
to the Company.
Exh. C-2
[FORM OF TAX OPINION OF LEDGEWOOD LAW FIRM, P.C.]
EXHIBIT D
1. Commencing with the Company's taxable year ending December 31, 2005,
the Company has been organized and operated in conformity with the requirements
for qualification and taxation as a REIT pursuant to sections 856 through 860 of
the Internal Revenue Code of 1986, as amended (the "Code"), and the Company's
current and proposed method of operation will enable it to continue to meet the
requirements for qualification and taxation as a REIT under the Code for its
taxable year ending December 31, 2005 and thereafter.
2. The descriptions of the law and the legal conclusions contained in
the Prospectus under the caption "Federal Income Tax Consequences of Our
Qualification As A REIT" are correct in all material respects and the
discussions thereunder fairly summarize the federal income tax considerations
that are likely to be material to a holder of the Common Stock.
Exh. D-1
[FORM OF LOCK-UP AGREEMENT]
EXHIBIT E
, 2006
Credit Suisse Securities (USA) LLC
Friedman, Billings, Xxxxxx & Co., Inc.
Citigroup Global Markets Inc.
X.X. Xxxxxx Securities Inc.,
c/o Credit Suisse Securities (USA) LLC
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Dear Sirs:
As an inducement to the Underwriters to execute the Underwriting
Agreement, pursuant to which an offering will be made that is intended to result
in the establishment of a public an orderly market for the common stock (the
"SECURITIES") of Resource Capital Corp., and any successor (by merger or
otherwise) thereto, (the "COMPANY"), the undersigned hereby agrees that during
the period specified in the following paragraph (the "LOCK-UP PERIOD"), the
undersigned will not offer, sell, contract to sell, pledge or otherwise dispose
of, directly or indirectly, any shares of Securities or securities convertible
into or exchangeable or exercisable for any shares of Securities, enter into a
transaction which would have the same effect, or enter into any swap, hedge or
other arrangement that transfers, in whole or in part, any of the economic
consequences of ownership of the Securities, whether any such aforementioned
transaction is to be settled by delivery of the Securities or such other
securities, in cash or otherwise, or publicly disclose the intention to make any
such offer, sale, pledge or disposition, or to enter into any such transaction,
swap, hedge or other arrangement, without, in each case, the prior written
consent of Credit Suisse Securities (USA) LLC ("CSS"). In addition, the
undersigned agrees that, without the prior written consent of CSS, it will not,
during the Lock-Up Period, make any demand for or exercise any right with
respect to, the registration of any Securities or any security convertible into
or exercisable or exchangeable for the Securities.
The initial Lock-Up Period will commence on the date of this Lock-Up
Agreement and continue and include the date 180 days after the public offering
date set forth on the final prospectus used to sell the Securities (the "PUBLIC
OFFERING DATE") pursuant to the Underwriting Agreement, to which you are or
expect to become parties; provided, however, that if (1) during the last 17 days
of the initial Lock-Up Period, the Company releases earnings results or material
news or a material event relating to the Company occurs or (2) prior to the
expiration of the initial Lock-Up Period, the Company announces that it will
release earnings results during the 16-day period beginning on the last day of
the initial Lock-Up Period, then in each case the Lock-Up Period will be
extended until the expiration of the 18-day period beginning on the date of
release of the earnings results or the occurrence of the material news or
material event, as applicable, unless CSS waives, in writing, such extension.
The undersigned hereby acknowledges and agrees that written notice of
any extension of the Lock-Up Period pursuant to the previous paragraph will be
delivered by CSS to the Company (in accordance with Section 11 of the
Underwriting Agreement) and that any such notice properly delivered will be
Exh. E-1
deemed to have been given to, and received by, the undersigned. The undersigned
further agrees that, prior to engaging in any transaction or taking any other
action that is subject to the terms of this Lock-Up Agreement during the period
from the date of this Lock-Up Agreement to an including the 34th day following
the expiration of the initial Lock-Up Period, it will give notice thereof to the
Company and will not consummate such transaction or take any such action unless
it has received written confirmation from the Company that the Lock-Up Period
(as may have been extended pursuant to the previous paragraph) has expired.
Any Securities received upon exercise of options granted to the
undersigned will also be subject to this Agreement. Any Securities acquired by
the undersigned in the open market will not be subject to this Agreement. A
transfer of Securities to a family member or trust may be made, provided the
transferee agrees to be bound in writing by the terms of this Agreement prior to
such transfer and no filing by any party (donor, donee, transferor or
transferee) under the Securities Exchange Act of 1934 shall be required or shall
be voluntarily made in connection with such transfer (other than a filing on a
Form 5 made after the expiration of the Lock-Up Period).
In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby authorized to decline to make any transfer of shares of
Securities if such transfer would constitute a violation or breach of this
Agreement
This Agreement shall be binding on the undersigned and the successors,
heirs, personal representatives and assigns of the undersigned. THIS AGREEMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.
Very truly yours,
---------------------------------
[Name of stockholder]
Exh. E-2
