CRIIMI MAE INC.
(a Maryland corporation)
Common Stock, Preferred Stock and
Debt Securities
UNDERWRITING AGREEMENT
March 24, 1997
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
CRIIMI MAE INC., a Maryland corporation (the "Company"), proposes to
issue and sell up to $106,558,125 aggregate initial public offering price of
its (i) shares of common stock, par value $.01 per share (the "Common Stock"),
(ii) shares of preferred stock, par value $.01 per share (the "Preferred
Stock"), (iii) subordinated debt securities (the "Debt Securities"), or any
combination thereof, from time to time, in or pursuant to one or more
offerings on terms to be determined at the time of sale.
The Preferred Stock will be issued in one or more series and each series
of Preferred Stock may vary, as applicable, as to the title, specific number
of shares, rank, stated value, liquidation preference, dividend rate or rates
(or method of calculation), dividend payment dates, redemption provisions,
sinking fund requirements, conversion provisions (and terms of the related
Underlying Securities (as defined below)) and any other variable terms as set
forth in the applicable articles supplementary (each, the "Articles
Supplementary") relating to such series of Preferred Stock.
The Debt Securities will be issued in one or more series as subordinated
indebtedness (the "Subordinated Debt Securities") under an indenture, between
the Company and one or more trustees, (each a "Trustee") to be negotiated by
the Company and such Trustee (the "Indenture"). Each series of Debt
Securities may vary, as applicable, as to title, aggregate principal amount,
rank, interest rate or formula and timing of payments thereof, stated maturity
date, redemption and/or repayment provisions, sinking fund requirements,
conversion provisions (and terms
of the related Underlying Securities) and any other variable terms established
by or pursuant to the applicable Indenture.
As used herein, "Securities" shall mean the Common Stock, Preferred
Stock, or Subordinated Debt Securities, or any combination thereof, initially
issuable by the Company and "Underlying Securities" shall mean the Common
Stock, Preferred Stock, or Subordinated Debt Securities issuable upon
conversion of the Preferred Stock or Subordinated Debt Securities, as appli
cable.
Whenever the Company determines to make an offering of Securities through
Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
("Xxxxxxx Xxxxx"), or through an underwriting syndicate managed by Xxxxxxx
Xxxxx, the Company will enter into an agreement (each, "Terms Agreement")
providing for the sale of such Securities to, and the purchase and offering
thereof by, Xxxxxxx Xxxxx and such other underwriters, if any, selected by
Xxxxxxx Xxxxx (the "Underwriters," which term shall include Xxxxxxx Xxxxx,
whether acting as sole Underwriter or as a member of an underwriting
syndicate, as well as any Underwriter substituted pursuant to Section 10
hereof). The Terms Agreement relating to the offering of Securities shall
specify the number or aggregate principal amount, as the case may be, of
Securities to be initially issued (the "Initial Underwritten Securities"), the
name of each Underwriter participating in such offering (subject to
substitution as provided in Section 10 hereof) and the name of any Underwriter
other xxxx Xxxxxxx Xxxxx acting as co-manager in connection with such
offering, the number or aggregate principal amount, as the case may be, of
Initial Underwritten Securities which each such Underwriter severally agrees
to purchase, whether such offering is on a fixed or variable price basis and,
if on a fixed price basis, the initial offering price, the price at which the
Initial Underwritten Securities are to be purchased by the Underwriters, the
form, time, date and place of delivery and payment of the Initial Underwritten
Securities and any other material variable terms of the Initial Underwritten
Securities, as well as the material variable terms of any related Underlying
Securities. In addition, if applicable, such Terms Agreement shall specify
whether the Company has agreed to grant to the Underwriters an option to
purchase additional Securities to cover over-allotments, if any, and the
number or aggregate principal amount, as the case may be, of Securities
subject to such option (the "Option Underwritten Securities"). As used
herein, the term "Underwritten Securities" shall include the Initial
Underwritten Securities and all or any portion of any Option Underwritten
Securities. The Terms Agreement, which shall be substantially in the form of
Exhibit A hereto, may take the form of an exchange of any standard form of
written telecommunication between the Company and Xxxxxxx Xxxxx, acting for
itself and, if applicable, as representative of any other
Underwriters. Each offering of Underwritten Securities through Xxxxxxx Xxxxx
as sole Underwriter or through an underwriting syndicate managed by Xxxxxxx
Xxxxx will be governed by this Underwriting Agreement, as supplemented by the
applicable Terms Agreement.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 33-54267) for the
registration of the Securities and the Underlying Securities under the
Securities Act of 1933, as amended (the "1933 Act"), and the offering thereof
from time to time in accordance with Rule 415 of the rules and regulations of
the Commission under the 1933 Act (the "1933 Act Regulations"), and the
Company has filed such post-effective amendments thereto as may be required
prior to the execution of the applicable Terms Agreement. Such registration
statement (as so amended, if applicable) has been declared effective by the
Commission and each Indenture (if applicable) has been duly qualified under
the Trust Indenture Act of 1939, as amended (the "1939 Act"). Such
registration statement (as so amended, if applicable), including the
information, if any, deemed to be a part thereof pursuant to Rule 430A(b) of
the 1933 Act Regulations (the "Rule 430A Information") or Rule 434(d) of the
1933 Xxx 0000 Act Regulations (the "Rule 434 Information"), is referred to
herein as the "Registration Statement"; and the final prospectus and the
prospectus supplement relating to the offering of the Underwritten Securities,
in the form first furnished to the Underwriters by the Company for use in
connection with the offering of the Underwritten Securities, are collectively
referred to herein as the "Prospectus"; provided, however, that all references
to the "Registration Statement" and the "Prospectus" shall be deemed to
include all documents incorporated therein by reference pursuant to the
Securities Exchange Act of 1934, as amended (the "1934 Act"), prior to the
execution of the applicable Terms Agreement; provided, further, that if the
Company files a registration statement with the Commission pursuant to
Section 462(b) of the 1933 Act Regulations (the "Rule 462 Registration
Statement"), then, after such filing, all references to "Registration
Statement" shall be deemed to include the Rule 462 Registration Statement; and
provided, further, that if the Company elects to rely upon Rule 434 of the
1933 Act Regulations, then all references to "Prospectus" shall be deemed to
include the final or preliminary prospectus and the applicable term sheet or
abbreviated term sheet (the "Term Sheet"), as the case may be, in the form
first furnished to the Underwriters by the Company in reliance upon Rule 434
of the 1933 Act Regulations, and all references in this Underwriting Agreement
to the date of the Prospectus shall mean the date of the Term Sheet. A
"preliminary prospectus" shall be deemed to refer to any prospectus used
before the registration statement became effective and any prospectus that
omitted, as applicable, the Rule 430A Information, the Rule 434 Information or
other information to be included upon pricing in a form of prospectus
filed with the Commission pursuant to Rule 424(b) of the 1933 Act Regulations,
that was used after such effectiveness and prior to the execution and delivery
of the applicable Terms Agreement. For purposes of this Underwriting
Agreement, all references to the Registration Statement, Prospectus, Term
Sheet or preliminary prospectus or to any amendment or supplement to any of
the foregoing shall be deemed to include the copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval system
("XXXXX").
All references in this Underwriting Agreement to financial statements and
schedules and other information which is "contained," "included" or "stated"
(or other references of like import) in the Registration Statement, Prospectus
or preliminary prospectus shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, Prospectus or preliminary
prospectus, as the case may be; and all references in this Underwriting
Agreement to amendments or supplements to the Registration Statement,
Prospectus or preliminary prospectus shall be deemed to mean and include the
filing of any document under the 1934 Act which is incorporated by reference
in the Registration Statement, Prospectus or preliminary prospectus, as the
case may be.
SECTION 1. REPRESENTATIONS AND WARRANTIES
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY.
The Company represents and warrants to Xxxxxxx Xxxxx, as of the date
hereof, and to each Underwriter named in the applicable Terms Agreement, as of
the date thereof, as of the Closing Time (as defined below) and, if
applicable, as of each Date of Delivery (as defined below) (in each case, a
"Representation Date"), as follows:
(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS.
The Company meets the requirements for use of Form S-3 under the
1933 Act. Each of the Registration Statement and any Rule 462(b)
Registration Statement has become effective under the 1933 Act and no
stop order suspending the effectiveness of the Registration Statement or
any Rule 462(b) Registration Statement has been issued under the 1933 Act
and no proceedings for that purpose have been instituted or are pending
or, to the knowledge of the Company, are contemplated by the Commission,
and any request on the part of the Commission for additional information
has been complied with. In addition, each Indenture has been duly
qualified under the 1939 Act.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto (including
the filing of the Company's most recent Annual Report on Form 10-K with the
Commission (the "Annual Report on Form 10-K")) became effective and at each
Representation Date, the Registration Statement, any Rule 462(b) Registration
Statement and any amendments and supplements thereto complied and will comply
in all material respects with the requirements of the 1933 Act and the 1933
Act Regulations and the 1939 Act and the rules and regulations of the
Commission under the 1939 Act (the "1939 Act Regulations") and did not and
will 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. At the date of the Prospectus, at the
Closing Time and at each Date of Delivery, if any, the Prospectus and any
amendments and supplements thereto did not and will not include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. If the Company elects to rely upon
Rule 434 of the 1933 Act Regulations, the Company will comply with the
requirements of Rule 434.
Each preliminary prospectus and prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriters for
use in connection with the offering of Underwritten Securities will, at the
time of such delivery, be identical to any electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T. Notwithstanding the foregoing, the
representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or the Prospectus
made in reliance upon and in conformity with information furnished to the
Company in writing by any Underwriter through Xxxxxxx Xxxxx expressly for use
in the Registration Statement or the Prospectus.
(ii) INCORPORATED DOCUMENTS.
The documents incorporated or deemed to be incorporated by reference in
the Registration Statement and the Prospectus, at the time they were or
hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the Commission thereunder (the "1934 Act Regulations") and,
when read together with the other information in the Prospectus (as the same
may be supplemented, updated or superseded by such incorporated documents), at
the date of the Prospectus, at the Closing Time and at each Date of Delivery,
if any, did not and will not include an untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(iii) INDEPENDENT ACCOUNTANTS.
The accountants who certified the financial statements and supporting
schedules included in the Registration Statement and the Prospectus are
independent public accountants as required by the 1933 Act and the 1933 Act
Regulations.
(iv) FINANCIAL STATEMENTS.
The financial statements of the Company included in the Registration
Statement and the Prospectus, together with the related schedules and notes,
as well as those financial statements, schedules and notes of any other entity
included therein, present fairly the financial position of the Company and its
consolidated subsidiaries, or such other entity, as the case may be, at the
dates indicated and the statement of operations, stockholders' equity and cash
flows of the Company and its consolidated subsidiaries, or such other entity,
as the case may be, for the periods specified. Such financial statements have
been prepared in conformity with generally accepted accounting principles
("GAAP") applied on a consistent basis throughout the periods involved. The
supporting schedules, if any, included in the Registration Statement and the
Prospectus present fairly in accordance with GAAP the information required to
be stated therein. The selected financial data and the summary financial
information included in the Prospectus present fairly the information shown
therein and have been compiled on a basis consistent with that of the audited
financial statements included in the Registration Statement and the
Prospectus. In addition, any pro forma financial statements of the Company
and its subsidiaries and the related notes thereto included in the
Registration Statement and the Prospectus present fairly the information shown
therein, have been prepared in all material respects 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 assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the transactions
and circumstances referred to therein.
(v) NO MATERIAL ADVERSE CHANGE IN BUSINESS.
Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as otherwise stated therein,
(A) there has been no material adverse change in the condition, financial or
otherwise, or in the earnings, or business affairs of the Company and its
subsidiaries considered as one enterprise (a "Material Adverse Effect"),
whether or not arising in the ordinary course of business, (B) there have been
no transactions entered into by the Company or any of its subsidiaries, other
than those arising in the ordinary course of business, which are material with
respect to the Company and its subsidiaries considered as one enterprise and
(C) except for regular dividends on the Company's common stock or preferred
stock, in amounts per share that are consistent with past practice or the
applicable charter document or supplement thereto, respectively, there has
been no dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(vi) GOOD STANDING OF THE COMPANY.
The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Maryland and has
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and to enter into and
perform its obligations under, or as contemplated under, this Underwriting
Agreement and the applicable Terms Agreement. The Company is duly qualified
as a foreign corporation to transact business and is in good standing in each
other jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business, except
where the failure to so qualify or be in good standing would not result in a
Material Adverse Effect.
(vii) GOOD STANDING OF SUBSIDIARIES.
Each "significant subsidiary" of the Company (as such term is defined in
Rule 1-02 of Regulation S-X promulgated under the 1933 Act ) each, a
"Subsidiary" and, collectively, the "Subsidiaries"), if any, has been duly
organized and is validly existing as a corporation or limited partnership in
good standing under the laws of the jurisdiction of its incorporation or
formation, has corporate or limited partnership 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
partnership to transact business and is in good standing in each jurisdiction
in which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure to so
qualify or be in good standing would not result in a Material Adverse Effect.
Except as otherwise stated in the Registration Statement and the Prospectus,
all of the issued and outstanding capital stock of each Subsidiary has been
duly authorized and is validly issued, fully paid and non-assessable and is
owned by the Company, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity. None
of the outstanding shares of capital stock of any Subsidiary was issued in
violation of preemptive or other similar rights of any securityholder of such
Subsidiary.
(viii) Capitalization.
If the Prospectus contains a "Capitalization" section, the authorized,
issued and outstanding shares of capital stock of the Company is as set forth
in the column entitled "Actual" under such section (except for subsequent
issuances thereof, if any, contemplated under this Underwriting Agreement,
pursuant to reservations, agreements or employee benefit plans referred to in
the Prospectus or pursuant to the exercise of convertible securities or
options referred to in the Prospectus). Such shares of capital stock have
been duly authorized and validly issued by the Company and are fully paid and
non-assessable, and none of such shares of capital stock were issued in
violation of preemptive or other similar rights of any securityholder of the
Company.
(ix) QUALIFICATION AS A REIT.
CRIIMI MAE Inc. and CRI Liquidating REIT, Inc., each, were organized and
have operated in conformity with the requirements for qualification and
taxation as real estate investment trusts ("REIT") under the Internal Revenue
Code of 1986, as amended (the "Code"), for each of their taxable years
beginning with their taxable year ended December 31, 1989 and their current
organization and method of operation will enable them to continue to meet the
requirements for qualification as a REIT.
(x) AUTHORIZATION OF THIS UNDERWRITING AGREEMENT AND TERMS AGREEMENT.
This Underwriting Agreement has been, and the applicable Terms Agreement
as of the date thereof will have been, duly authorized, executed and delivered
by the Company.
(xi) AUTHORIZATION OF COMMON STOCK.
If the Underwritten Securities being sold pursuant to the applicable
Terms Agreement include Common Stock, such Underwritten Securities have
been, or as of the date of such Terms Agreement will have been, duly
authorized by the Company for issuance and sale pursuant to this Underwriting
Agreement and such Terms Agreement. Such Underwritten Securities, when issued
and delivered by the Company pursuant to this Underwriting Agreement and such
Terms Agreement against payment of the consideration therefor specified in
such Terms Agreement, will be validly issued, fully paid and non-assessable
and will not be subject to preemptive or other similar rights of any
securityholder of the Company. No holder of such Underwritten Securities will
be subject to personal liability by reason of being such a holder.
(xii) AUTHORIZATION OF PREFERRED STOCK.
If the Underwritten Securities being sold pursuant to the applicable
Terms Agreement include Preferred Stock such Underwritten Securities have
been, or as of the date of such Terms Agreement will have been, duly
authorized by the Company for issuance and sale pursuant to this Underwriting
Agreement and such Terms Agreement. The applicable Preferred Stock, when
issued and delivered by the Company pursuant to this Underwriting Agreement
and such Terms Agreement against payment of the consideration therefor, will
be validly issued, fully paid and non-assessable and will not be subject to
preemptive or other similar rights of any securityholder of the Company. No
holder of Preferred Stock will be subject to personal liability by reason of
being such a holder. The applicable Articles Supplementary for such Preferred
Stock will be in full force and effect prior to the Closing Time.
(xiii) AUTHORIZATION OF SUBORDINATED DEBT SECURITIES.
If the Underwritten Securities being sold pursuant to the applicable
Terms Agreement include Subordinated Debt Securities, such Underwritten
Securities have been, or as of the dates of such Terms Agreement will have
been, duly authorized by the Company for issuance and sale pursuant to this
Underwriting Agreement and such Terms Agreement. Such Underwritten
Securities, when issued and authenticated in the manner provided for in the
applicable Indenture and delivered against payment of the consideration
therefor specified in such Terms Agreement, will constitute valid and legally
binding obligations of the Company, enforceable against the Company in
accordance with their terms, except as the enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium
or other similar laws relating to or affecting rights of creditors generally
or by general equitable principles, and except further as enforcement thereof
may be limited by (A) requirements that a claim with respect to any
Debt Securities denominated other than in U.S. dollars (or a foreign or
composite currency judgment in respect of such claim) be converted into U.S.
dollars at a rate of exchange prevailing on a date determined pursuant to
applicable law or (B) governmental authority to limit, delay or prohibit the
making of payments outside the United States. Such Underwritten Securities
will be in the form contemplated by, and each registered holder thereof is
entitled to the benefits of, the applicable Indenture.
(xiv) AUTHORIZATION OF THE INDENTURES.
If the Underwritten Securities being sold pursuant to the applicable
Terms Agreement include Subordinated Debt Securities or if Preferred Stock is
convertible into Debt Securities, each applicable Indenture has been, or prior
to the issuance of the Debt Securities thereunder will have been, duly
authorized, executed and delivered by the Company and, upon such
authorization, execution and delivery, will constitute a valid and legally
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws relating to or affecting rights of creditors generally or
by general equitable principles.
(xv) DESCRIPTIONS OF THE UNDERWRITTEN SECURITIES, UNDERLYING
SECURITIES AND INDENTURES.
The Underwritten Securities being sold pursuant to the applicable Terms
Agreement and each applicable Indenture, as of the date of the Prospectus, and
any Underlying Securities, when issued and delivered in accordance with the
terms of the related Underwritten Securities, will conform in all material
respects to the statements relating thereto contained in the Prospectus and
will be in substantially the form filed or incorporated by reference, as the
case may be, as an exhibit to the Registration Statement.
(xvi) ABSENCE OF DEFAULTS AND CONFLICTS.
Neither the Company nor any of its subsidiaries is in violation of its
charter or by-laws or other organizational documents or in default in the
performance or observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which the Company or any of its
subsidiaries may be bound, or to which any of the property or assets of the
Company or any subsidiary is subject (collectively, "Agreements and
Instruments") except for such defaults that would not result in a Material
Adverse Effect. The execution, delivery and performance of this Underwriting
Agreement, the applicable Terms Agreement and each applicable Indenture,
and any other agreement or instrument entered into or issued or to be entered
into or issued by the Company in connection with the transactions contemplated
hereby or thereby or in the Registration Statement and the Prospectus and the
consummation of the transactions contemplated herein and in the Registration
Statement and the Prospectus (including the issuance and sale of the
Underwritten Securities and the use of the proceeds from the sale of the
Underwritten Securities as described under the caption "Use of Proceeds") and
compliance by the Company with its obligations hereunder and thereunder have
been duly authorized by all necessary corporate action and do not and will
not, whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any assets, properties or operations of the Company
or any subsidiary pursuant to any Agreements and Instruments except for such
conflicts, breaches, defaults, events or liens, charges or encumbrances that
would not result in a Material Adverse Effect nor will such action result in
any violation of the provisions of the charter, by-laws or other
organizational documents of the Company or any of its subsidiaries or any
applicable law, statute, rule, regulation, judgment, order, writ or decree of
any government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any of its subsidiaries or any of
their assets, properties or operations except for such violations of any
applicable law, statute, rule, regulation, judgment, order, writ or decree of
any government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any of its subsidiaries or any of
their assets, properties or operations that would not result in a Material
Adverse Effect. As used herein, a "Repayment Event" means any event or
condition which gives the holder of any note, debenture or other evidence of
indebtedness (or any person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any subsidiary.
(vxii) ABSENCE OF LABOR DISPUTE.
No labor dispute with the employees of the Company or any subsidiary
exists or, to the knowledge of the Company, is imminent, and the Company is
not aware of any existing or imminent labor disturbance by the employees of
any of its or any subsidiary's principal customers or contractors, which, in
either case, may reasonably be expected to result in a Material Adverse
Effect.
(xviii) ABSENCE OF PROCEEDINGS.
There is no action, suit, proceeding, inquiry or investigation before or
brought by any court or governmental agency or body, domestic or foreign, now
pending, or to the knowledge of the Company threatened, against or affecting
the Company or any subsidiary thereof which is required to be disclosed in the
Registration Statement and the Prospectus (other than as stated therein), or
which might reasonably be expected to result in a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect the
assets, properties or operations thereof or the consummation of the
transactions contemplated under this Underwriting Agreement, the applicable
Terms Agreement or any applicable Indenture, or the performance by the Company
of its obligations hereunder and thereunder. The aggregate of all pending
legal or governmental proceedings to which the Company or any subsidiary
thereof is a party or of which any of their respective assets, properties or
operations is the subject which are not described in the Registration
Statement and the Prospectus, including ordinary routine litigation incidental
to the business, could not reasonably be expected to result in a Material
Adverse Effect.
(xix) ACCURACY OF EXHIBITS.
There are no contracts or documents which are required to be described in
the Registration Statement, the Prospectus or the documents incorporated by
reference therein or to be filed as exhibits thereto which have not been so
described and/or filed as required.
(xx) ABSENCE OF FURTHER REQUIREMENTS.
No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental authority
or agency is necessary or required for the performance by the Company of its
obligations under this Underwriting Agreement or the applicable Terms
Agreement or in connection with the transactions contemplated under this
Underwriting Agreement, such Terms Agreement or any applicable Indenture
except such as have been already obtained or as may be required under state
securities laws.
(xxi) POSSESSION OF INTELLECTUAL PROPERTY.
The Company and its subsidiaries own or possess, or can acquire on
reasonable terms, adequate trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary to
carry on the business now operated by them, and neither the Company nor any of
its subsidiaries has received any notice or otherwise has knowledge of any
infringement of or conflict with asserted rights of others with respect to any
Intellectual Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of the
Company or any of its subsidiaries therein, and which infringement or conflict
(if the subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would result in a Material Adverse
Effect.
(xxii) POSSESSION OF LICENSES AND PERMITS.
The Company and its subsidiaries possess such permits, licenses,
approvals, consents and other authorizations (collectively, "Governmental
Licenses") issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to conduct the business now operated
by them, except where the failure to possess any such Governmental License
would not have a Material Adverse Effect. The Company and its subsidiaries
are in compliance with the terms and conditions of all such Governmental
Licenses, except where the failure so to comply would not, singly or in the
aggregate, result in a Material Adverse Effect. All of the Governmental
Licenses are valid and in full force and effect, except where the invalidity
of such Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not result in a Material Adverse Effect.
Neither the Company nor any of its subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such
Governmental Licenses which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a Material Adverse
Effect.
(xxiii) TITLE TO PROPERTY.
The Company and its subsidiaries have good and marketable title to all
real property owned by the Company and its subsidiaries and good title to all
other properties owned by them, in each case, free and clear of all mortgages,
pledges, liens, security interests, claims, restrictions or encumbrances of
any kind except (A) as otherwise stated in the Registration Statement and the
Prospectus or (B) those which do not, singly or in the aggregate, materially
affect the value of such property and do not interfere with the use made and
proposed to be made of such property by the Company or any of its
subsidiaries. All of the leases and subleases material to the business of the
Company and its subsidiaries considered as one enterprise, and under which the
Company or any subsidiary holds properties described in the Prospectus, are in
full force and effect, and neither the Company nor any of its subsidiaries has
received any notice of any material claim of any sort that has been asserted
by anyone adverse to the rights of the Company or any of its
subsidiaries under any of the leases or subleases mentioned above, or
affecting or questioning the rights of the Company or such subsidiary of the
continued possession of the leased or subleased premises under any such lease
or sublease.
(xxiv) COMMODITY EXCHANGE ACT.
If the Underwritten Securities being sold pursuant to the applicable
Terms Agreement include Debt Securities or if any related Underlying
Securities include Debt Securities, as the case may be, such Debt Securities,
upon issuance, will be excluded or exempted under, or beyond the purview of,
the Commodity Exchange Act, as amended (the "Commodity Exchange Act"), and the
rules and regulations of the Commodity Futures Trading Commission under the
Commodity Exchange Act (the "Commodity Exchange Act Regulations").
(xxv) INVESTMENT COMPANY ACT.
The Company is not, and upon the issuance and sale of the Underwritten
Securities as herein contemplated and the application of the net proceeds
therefrom as described in the Prospectus will not be, an "investment company"
within the meaning of the Investment Company Act of 1940, as amended (the
"1940 Act").
(xxvi) ENVIRONMENTAL LAWS.
Except as otherwise stated in the Registration Statement and the
Prospectus and except such violations or other matters as described in this
paragraph as would not, singly or in the aggregate, result in a Material
Adverse Effect, (A) neither the Company nor any of its subsidiaries is in
violation of any federal, state, local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law and any judicial or
administrative interpretation thereof including any judicial or administrative
order, consent, decree or judgment, relating to pollution or protection of
human health, the environment (including, without limitation, ambient air,
surface water, groundwater, land surface or subsurface strata) or wildlife,
including, without limitation, laws and regulations relating to the release or
threatened release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products, asbestos,
PCBs, radioactive materials, or infectious, carcinogenic or mutagenic
materials (collectively, "Hazardous Materials") or to the generation,
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials (collectively, "Environmental
Laws"), (B) the
Company and its subsidiaries have all permits, authorizations and approvals
required under any applicable Environmental Laws and are each in compliance
with their requirements, (C) there are no pending or, to the Company's
knowledge, threatened administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, notices of noncompliance or violation,
proceedings or, to the Company's knowledge, investigations relating to any
Environmental Law against the Company or any of its subsidiaries, and (D)
there are no events or circumstances that might reasonably be expected to form
the basis of an order for clean-up or remediation, or an action, suit or
proceeding by any private party or governmental body or agency, against or
affecting the Company or any of its subsidiaries relating to any Hazardous
Materials or the violation of any Environmental Laws.
(xxvii) TAX COMPLIANCE.
The Company has filed or caused to be filed all federal, state, local and
foreign income tax returns which have been required to be filed (except in any
case in which the failure to so file would not have a Material Adverse Effect)
and has paid all taxes required to be paid for any other assessment, fine or
penalty levied against it, to the extent that any of the foregoing is due and
payable, except, in all cases, for any such tax, assessment, fine or penalty
that is being contested in good faith.
(xxviii) ABSENCE OF PRICE MANIPULATION.
Neither the Company nor any of its directors, officers or controlling
persons, has taken or will take, directly or indirectly, any action resulting
in a violation of Regulation M or designed to cause or result in, or that has
constituted or that reasonably might be expected to constitute, the
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Underwritten Securities.
(xxix) COMPLIANCE WITH CUBA ACT.
The Company has complied with, and is and will be in compliance with, the
provisions of that certain Florida act relating to disclosure of doing
business with Cuba, codified as Section 517.075 of the Florida statutes, and
the rules and regulations thereunder or is exempt therefrom.
(xxx) INSURANCE.
The Company maintains insurance of the types and in the amounts generally
deemed adequate for its business, including, but not limited to, insurance
covering real and personal property owned or leased by the
Company against theft, forgery, damage, destruction, acts of vandalism and all
other risks customarily insured against, all of which insurance is in full
force and effect, except where the failure to maintain such insurance or have
such insurance in full force and effect would not have a Material Adverse
Effect.
(xxxi) ABSENCE OF UNLAWFUL CONTRIBUTIONS.
The Company has not at any time during the last five years (i) made any
unlawful contribution to any candidate for foreign office, or failed to
disclose fully any contribution in violation of law, or (ii) made any payment
to any federal or state governmental officer or official, or other person
charged with similar public or quasi-public duties, other than payments
required or permitted by the laws of the United States or any jurisdiction
thereof.
(xxxii) TRANSACTIONS BETWEEN COMPANY AND OFFICERS AND DIRECTORS.
All material transactions between the Company and the officers and directors
of the Company and its affiliates required to be disclosed in the Registration
Statement and Prospectus have been accurately disclosed in all material
respects in the Registration Statement and Prospectus and the documents
incorporated therein by reference.
(xxxiii) ERISA UNDERWRITTEN SECURITIES.
None of the assets of the Company are, nor will such assets, as of the
Closing Date, constitute, "plan assets" under the Employee Retirement Income
Security Act of 1974, as amended ("ERISA").
(b) OFFICERS' CERTIFICATES.
Any certificate signed by any officer of the Company or any subsidiary
and delivered to any Underwriter or to counsel for the Underwriters in
connection with the offering of the Underwritten Securities shall be deemed a
representation and warranty by the Company to each Underwriter as to the
matters covered thereby on the date of such certificate and, unless
subsequently amended or supplemented, at each Representation Date subsequent
thereto.
SECTION 2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING
(a) UNDERWRITTEN SECURITIES.
The several commitments of the Underwriters to purchase the Underwritten
Securities pursuant to the applicable Terms Agreement shall be deemed to have
been made on the basis of the representations and warranties herein contained
and shall be subject to the terms and conditions herein set forth.
(b) OPTION UNDERWRITTEN SECURITIES.
In addition, subject to the terms and conditions herein set forth, the
Company may grant, if so provided in the applicable Terms Agreement, an option
to the Underwriters, severally and not jointly, to purchase up to the number
or aggregate principal amount, as the case may be, of the Option Underwritten
Securities set forth therein at a price per Option Underwritten Security equal
to the price per Initial Underwritten Security, less an amount equal to any
dividends or distributions declared by the Company and paid or payable on the
Initial Underwritten Securities but not payable on the Option Underwritten
Securities. Such option, if granted, will expire 30 days after the date of
such Terms Agreement, and may be exercised in whole or in part from time to
time only for the purpose of covering over-allotments which may be made in
connection with the offering and distribution of the Initial Underwritten
Securities upon notice by Xxxxxxx Xxxxx to the Company setting forth the
number or aggregate principal amount, as the case may be, of Option
Underwritten Securities as to which the several Underwriters are then
exercising the option and the time, date and place of payment and delivery for
such Option Underwritten Securities. Any such time and date of payment and
delivery (each, a "Date of Delivery") shall be mutually agreed upon by the
Company and by Xxxxxxx Xxxxx, but shall not be later than seven full business
days after the exercise of said option, nor in any event prior to the Closing
Time, unless otherwise agreed upon by Xxxxxxx Xxxxx and the Company. If the
option is exercised as to all or any portion of the Option Underwritten
Securities, each of the Underwriters, severally and not jointly, will purchase
that proportion of the total number or aggregate principal amount, as the case
may be, of Option Underwritten Securities then being purchased which the
number or aggregate principal amount, as the case may be, of Initial
Underwritten Securities each such Underwriter has severally agreed to purchase
as set forth in such Terms Agreement bears to the total number or aggregate
principal amount, as the case may be, of Initial Underwritten Securities,
subject to such adjustments as Xxxxxxx Xxxxx in its discretion shall make to
eliminate any sales or purchases of a fractional number or aggregate principal
amount, as the case may be, of Option Underwritten Securities.
(c) PAYMENT.
Payment of the purchase price for, and delivery of the Initial
Underwritten Securities shall be made at the office of Xxxxx & Xxxxxxx L.L.P.,
000 Xxxxxxxxxx Xxxxxx, X.X., or at such other place as shall be agreed upon by
Xxxxxxx Xxxxx and the Company, at 10:00 A.M. (Eastern time) on the third
(fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any given
day) business day after the date hereof (unless postponed in accordance with
the provisions of Section 10 hereof), or such other time not later than ten
business days after such date as shall be agreed upon
by Xxxxxxx Xxxxx and the Company (such time and date of payment and delivery
being herein called "Closing Time"). In addition, in the event that the
Underwriters have exercised their option, if any, to purchase any or all of
the Option Underwritten Securities, payment of the purchase price for, and
delivery of such Option Underwritten Securities, shall be made at the above-
mentioned offices of Xxxxx & Xxxxxxx L.L.P., or at such other place as shall
be agreed upon by Xxxxxxx Xxxxx and the Company, on the relevant Date of
Delivery as specified in the notice from Xxxxxxx Xxxxx to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company against delivery
to Xxxxxxx Xxxxx for the respective accounts of the Underwriters of the
Underwritten Securities to be purchased by them. It is understood that each
Underwriter has authorized Xxxxxxx Xxxxx, for its account, to accept delivery
of, receipt for, and make payment of the purchase price for, the Underwritten
Securities which it has severally agreed to purchase. Xxxxxxx Xxxxx,
individually and not as representative of the Underwriters, may (but shall not
be obligated to) make payment of the purchase price for the Underwritten
Securities to be purchased by any Underwriter whose check has not been
received by the Closing Time or the relevant Date of Delivery, as the case may
be, but such payment shall not relieve such Underwriter from its obligations
hereunder.
(d) DENOMINATIONS; REGISTRATION.
The Underwritten Securities or certificates for the Underwritten
Securities, as applicable, shall be in such denominations and registered in
such names as Xxxxxxx Xxxxx may request in writing at least one full business
day prior to the Closing Time or the relevant Date of Delivery, as the case
may be. The Underwritten Securities or certificates for the Underwritten
Securities, as applicable, will be made available for examination and
packaging by Xxxxxxx Xxxxx in The City of New York not later than 10:00 A.M.
(Eastern time) on the business day prior to the Closing Time or the relevant
Date of Delivery, as the case may be.
SECTION 3. COVENANTS OF THE COMPANY
The Company covenants with Xxxxxxx Xxxxx and with each Underwriter
participating in the offering of Underwritten Securities, as follows:
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS.
The Company, subject to Section 3(b), will comply with the requirements of
Rule 430A of the 1933 Act Regulations and/or Rule 434 of the 1933 Act
Regulations, if and as applicable, and will notify the Underwriters
immediately, and confirm the notice in writing, of (i) the effectiveness of
any post-effective amendment to the Registration Statement or the filing of
any supplement or amendment to the Prospectus, (ii) the receipt of any
comments from the Commission, (iii) any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to the
Prospectus or for additional information, and (iv) the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of any order preventing or suspending the use of any preliminary
prospectus, or of the suspension of the qualification of the Underwritten
Securities for offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes. The Company will
promptly effect the filings necessary pursuant to Rule 424 within the period
specified therein and will take such steps as it deems necessary to ascertain
promptly whether the prospectus transmitted for filing under Rule 424 was
received for filing by the Commission and, in the event that it was not, it
will promptly file the Prospectus. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) FILING OF AMENDMENTS.
The Company will give Xxxxxxx Xxxxx notice of its intention to file or
prepare any amendment to the Registration Statement (including any filing
under Rule 462(b) of the 1933 Act Regulations), any Term Sheet or any
amendment, supplement or revision to either the prospectus included in the
Registration Statement at the time it became effective or to the Prospectus,
whether pursuant to the 1933 Act, the 1934 Act or otherwise, will xxxxxxx
Xxxxxxx Xxxxx with copies of any such documents a reasonable amount of time
prior to such proposed filing or use, as the case may be, and will not file or
use any such document to which Xxxxxxx Xxxxx or counsel for the Underwriters
shall reasonably object by notice to the Company.
(c) DELIVERY OF REGISTRATION STATEMENTS.
The Company has furnished or will deliver to Xxxxxxx Xxxxx and counsel
for the Underwriters, without charge, conformed copies of the Registration
Statement as originally filed and of each amendment thereto (including
exhibits filed therewith or incorporated by reference therein and documents
incorporated or deemed to be incorporated by reference therein) and conformed
copies of all consents and certificates of experts, and will also deliver to
Xxxxxxx Xxxxx, without charge, a conformed copy of the Registration Statement,
as amended, (without exhibits) for each of the Underwriters. The copies of
the Registration Statement and each amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(d) DELIVERY OF PROSPECTUSES.
The Company will deliver to each Underwriter, without charge, as many
copies of each preliminary prospectus as such Underwriter may reasonably
request, and the Company hereby consents to the use of such copies for
purposes permitted by the 1933 Act and this Agreement. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
such number of copies of the Prospectus as such Underwriter may reasonably
request. If applicable, the Prospectus and any amendments or supplements
thereto furnished to the Underwriters will be identical to any electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX, except
to the extent permitted by Regulation S-T.
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS.
The Company will comply with the 1933 Act and the 1933 Act Regulations
and the 1934 Act and the 1934 Act Regulations so as to permit the completion
of the
distribution of the Underwritten Securities as contemplated in this
Underwriting Agreement and the applicable Terms Agreement and in the
Registration Statement and the Prospectus. If at any time when the Prospectus
is required by the 1933 Act or the 1934 Act to be delivered in connection with
sales of the Underwritten Securities, any event shall occur or condition shall
exist as a result of which it is necessary, in the opinion of counsel for the
Underwriters or for the Company, to amend the Registration Statement in order
that the Registration Statement will 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 or to amend or
supplement the Prospectus in order that the Prospectus will not include an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the opinion of such counsel, at any such time to amend
the Registration Statement or amend or supplement the Prospectus in order to
comply with the requirements of the 1933 Act or the 1933 Act Regulations, the
Company will promptly prepare and file with the Commission, subject to Section
3(b), such amendment or supplement as may be necessary to correct such
statement or omission or to make the Registration Statement or the Prospectus
comply with such requirements, and the Company will furnish to the
Underwriters, without charge, such number of copies of such amendment or
supplement as the Underwriters may reasonably request.
(f) BLUE SKY QUALIFICATIONS.
The Company will use its best efforts, in cooperation with the
Underwriters, to qualify the Underwritten Securities and any related
Underlying Securities for offering and sale under the applicable securities
laws of such states and other jurisdictions (domestic or foreign) as Xxxxxxx
Xxxxx may reasonably designate and to maintain such qualifications in effect
for a period of not less than one year from the date of the applicable Terms
Agreement; provided, however, that the Company shall not be obligated to file
any general consent to service of process or to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which it is
not so qualified or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Underwritten Securities or any related Underlying
Securities have been so qualified, the Company will file such statements and
reports as may be required by the laws of such jurisdiction to continue such
qualification in effect for a period of not less than one year from the date
of such Terms Agreement.
(g) EARNINGS STATEMENT.
The Company will timely file such reports pursuant to the 1934 Act as are
necessary in order to make generally available to its securityholders as soon
as practicable an earnings statement for the purposes of, and to provide the
benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act.
(h) RESERVATION OF SECURITIES.
If the applicable Terms Agreement specifies that any related Underlying
Securities include Common Stock or Preferred Stock, the Company will reserve
and keep available at all times, free of preemptive or other similar rights, a
sufficient number of shares of Common Stock and/or Preferred Stock, as
applicable, for the purpose of enabling the Company to satisfy any obligations
to issue such Underlying Securities upon conversion of the Preferred Stock or
Subordinated Debt Securities, as applicable.
(i) USE OF PROCEEDS.
The Company will use the net proceeds received by it from the sale of the
Underwritten Securities in the manner specified in the Prospectus under "Use
of Proceeds."
(j) LISTING.
The Company will use its best efforts to effect the listing of the
Underwritten Securities and any related Underlying Securities, prior to the
Closing Time, on any national securities exchange or quotation system if and
as specified in the applicable Terms Agreement.
(k) RESTRICTION ON SALE OF SECURITIES.
Between the date of the applicable Terms Agreement and the Closing Time
or such other date specified in such Terms Agreement, the Company will not,
without the prior written consent of Xxxxxxx Xxxxx, directly or indirectly,
issue, sell, offer to sell, grant any option for the sale of, or otherwise
dispose of the securities specified in such Terms Agreement, except as
specified in such Terms Agreement.
(l) REPORTING REQUIREMENTS.
The Company, during the period when the Prospectus is required to be
delivered under the 1933 Act or the 1934 Act, will file all documents required
to be filed with the Commission pursuant to the 1934 Act within the time
periods required by the 1934 Act and the 1934 Act Regulations.
SECTION 4. PAYMENT OF EXPENSES
(a) EXPENSES.
The Company will pay all expenses incident to the performance of its
obligations under this Underwriting Agreement or the applicable Terms
Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of this Underwriting Agreement, any Terms
Agreement, any Agreement among Underwriters, the Indentures and such other
documents as may be required in connection with the offering, purchase, sale
and delivery of the Underwritten Securities or any related Underlying
Securities, (iii) the preparation, issuance and delivery of the Underwritten
Securities and any related Underlying Securities, any certificates for the
Underwritten Securities or such Underlying Securities, as applicable, to the
Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors or agents (including transfer agents and
registrars), as well as the fees and disbursements of the Trustees, and their
respective counsel, (v) the qualification of the Underwritten Securities and
any related Underlying Securities under state securities laws in accordance
with the provisions of Section 3(f) hereof, including filing fees and the
reasonable fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation, printing and
delivery of the Blue Sky Survey and any Legal Investment Survey, and any
amendment thereto (subject to any limitation on such fees and expenses set
forth in the applicable Terms Agreement), (vi) the printing and delivery to
the Underwriters of copies of each preliminary prospectus, any Term Sheet, and
the Prospectus and any amendments or supplements thereto, (vii) the fees
charged by nationally recognized statistical rating organizations for the
rating of the Underwritten Securities and any related Underlying Securities,
if applicable, (viii) the fees and expenses incurred with respect to the
listing of the Underwritten Securities and any related Underlying Securities,
if applicable, (ix) the filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review,
if any, by the National Association of Securities Dealers, Inc. (the "NASD")
of the terms of the sale of the Underwritten Securities and any related
Underlying Securities, and (x) the fees and expenses of any Underwriter acting
in the capacity of a "qualified independent underwriter" as defined in Rule
2720(b)(15) of the NASD's Conduct Rules, if applicable.
(b) TERMINATION OF AGREEMENT.
If the applicable Terms Agreement is terminated by Xxxxxxx Xxxxx in
accordance with the provisions of Section 5 or Section 9(b)(i) hereof, the
Company
shall reimburse the Underwriters for all of their reasonable out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the
Underwriters.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS
The obligations of the Underwriters to purchase and pay for the
Underwritten Securities pursuant to the applicable Terms Agreement are subject
to the accuracy of the representations and warranties of the Company contained
in Section 1 hereof or in certificates of any officer of the Company or any of
its subsidiaries delivered pursuant to the provisions hereof, to the
performance by the Company of its covenants and other obligations hereunder,
and to the following further conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT.
The Registration Statement, including any Rule 462(b) Registration
Statement, has become effective under the 1933 Act and no stop order
suspending the effectiveness of the Registration Statement shall have been
issued under the 1933 Act or proceedings therefor initiated or threatened by
the Commission, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of
counsel to the Underwriters. A prospectus containing information relating to
the description of the Underwritten Securities and any related Underlying
Securities, the specific method of distribution and similar matters shall have
been filed with the Commission in accordance with Rule 424(b)(1), (2), (3),
(4) or (5), as applicable (or any required post-effective amendment providing
such information shall have been filed and declared effective in accordance
with the requirements of Rule 430A) or, if the Company has elected to rely
upon Rule 434 of the 1933 Act Regulations, a Term Sheet including the Rule 434
Information shall have been filed with the Commission in accordance with Rule
424(b)(7).
(b) OPINION OF COUNSEL FOR COMPANY.
At Closing Time, Xxxxxxx Xxxxx shall have received the opinion, dated as
of Closing Time, of Xxxxxxx & Berlin, Chartered, Washington, D.C., counsel for
the Company, in form and substance satisfactory to counsel for the
Underwriters, together with signed or reproduced copies of such letter for
each of the other Underwriters, to the effect set forth in Exhibit B hereto
and to such further effect as counsel to the Underwriters may reasonably
request. In giving such opinion, such counsel may rely, as to all matters
governed by the laws of jurisdictions other than the law of the District of
Columbia, the federal law of the United States and the
General Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to the Underwriters. Such counsel may also state that, insofar
as such opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and its subsidiaries
and certificates of public officials.
(c) OPINION OF COUNSEL FOR UNDERWRITERS.
At Closing Time, Xxxxxxx Xxxxx shall have received the favorable opinion,
dated as of Closing Time, of Xxxxx & Xxxxxxx L.L.P., counsel for the
Underwriters, together with signed or reproduced copies of such letter for
each of the other Underwriters, with respect to the matters set forth in (1),
(6), (7) to (11), as applicable, (12), (13) (solely as to the information in
the Prospectus under "Description of the Underwritten Securities" and
"Description of the Underlying Securities", if any, or any caption purporting
to describe any such Securities), (18), (19) and the penultimate paragraph of
Exhibit B hereto. In giving such opinion, such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the law of the
District of Columbia, the federal law of the United States and the General
Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to Xxxxxxx Xxxxx. Such counsel may also state that, insofar as
such opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and its subsidiaries
and certificates of public officials.
(d) OFFICERS' CERTIFICATE.
At Closing Time, there shall not have been, since the date of the
applicable Terms Agreement or since the respective dates as of which
information is given in the Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings, or business affairs of
the Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and Xxxxxxx Xxxxx shall have
received a certificate of the President or a Vice President of the Company and
of the chief financial officer or chief accounting officer of the Company,
dated as of Closing Time, to the effect that (i) there has been no such
material adverse change, (ii) the representations and warranties in Section 1
are true and correct with the same force and effect as though expressly made
at and as of the Closing Time, (iii) the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the Closing Time, and (iv) no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been initiated or threatened by the
Commission.
(e) ACCOUNTANT'S COMFORT LETTER.
At the time of the execution of the applicable Terms Agreement, Xxxxxxx
Xxxxx shall have received from Xxxxxx Xxxxxxxx LLP a letter dated such date,
in form and substance satisfactory to Xxxxxxx Xxxxx, together with signed or
reproduced copies of such letter for each of the other Underwriters,
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
Statement and the Prospectus.
(f) BRING-DOWN COMFORT LETTER.
At Closing Time, Xxxxxxx Xxxxx shall have received from Xxxxxx Xxxxxxxx
LLP a letter, dated as of Closing Time, to the effect that they reaffirmed the
statements made in the letter furnished pursuant to subsection (e) of this
Section 5, except that the specified date referred to shall be a date not more
than three business days prior to the Closing Time.
(g) RATINGS.
At Closing Time and at any relevant Date of Delivery, the Underwritten
Securities shall have the rating accorded by any "nationally recognized
statistical rating organization", as defined by the Commission for purposes of
Rule 436(g)(2) of the 1933 Act Regulations, if and as specified in the
applicable Terms Agreement, and the Company shall have delivered to Xxxxxxx
Xxxxx a letter, dated as of such date, from each such rating organization, or
other evidence reasonably satisfactory to Xxxxxxx Xxxxx, confirming that the
Underwritten Securities have such ratings. Since the time of execution of
such Terms Agreement, there shall not have occurred a downgrading in the
rating assigned to the Underwritten Securities or any of the Company's other
securities by any such rating organization, and no such rating organization
shall have publicly announced that it has under surveillance or review, with
possible negative implications, its rating of the Underwritten Securities or
any of the Company's other securities.
(h) APPROVAL OF LISTING.
At Closing Time, the Underwritten Securities shall have been approved for
listing, subject only to official notice of issuance, if and as specified in
the applicable Terms Agreement.
(i) NO OBJECTION.
If the Registration Statement or an offering of Underwritten Securities
has been filed with the NASD for review, the NASD shall not have raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(j) LOCK-UP AGREEMENTS.
On the date of the applicable Terms Agreement, Xxxxxxx Xxxxx shall have
received, in form and substance satisfactory to it, each lock-up agreement, if
any, specified in such Terms Agreement as being required to be delivered by
the persons listed therein.
(k) OVER-ALLOTMENT OPTION.
In the event that the Underwriters are granted an over-allotment option
by the Company in the applicable Terms Agreement and the Underwriters exercise
their Option to purchase all or any portion of the Option Underwritten
Securities, the representations and warranties of the Company contained herein
and the statements in any certificates furnished by the Company or any of its
subsidiaries hereunder shall be true and correct as of each Date of Delivery,
and, at the relevant Date of Delivery, Xxxxxxx Xxxxx shall have received:
(1) A certificate, dated such Date of Delivery, of the President
or a Vice President of the Company and the chief financial officer or
chief accounting officer of the Company, confirming that the certificate
delivered at the Closing Time pursuant to Section 5(d) hereof remains
true and correct as of such Date of Delivery.
(2) The favorable opinion of Xxxxxxx & Berlin, Chartered,
Washington, D.C., counsel for the Company, in form and substance
satisfactory to counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Underwritten Securities and otherwise to
the same effect as the Opinion required by Section 5(b) hereof.
(3) The favorable Opinion of Xxxxx & Xxxxxxx L.L.P., counsel for
the Underwriters, dated such Date of Delivery, relating to the Option
Underwritten Securities and otherwise to the same effect as the opinion
required by Section 5(c) hereof.
(4) A letter from Xxxxxx Xxxxxxxx LLP, in form and substance
satisfactory to Xxxxxxx Xxxxx and dated such Date of Delivery,
substantially in the same form and substance as the letter furnished to
Xxxxxxx Xxxxx
pursuant to Section 5(f) hereof, except that the "specified
date" on the letter furnished pursuant to this paragraph shall be a date
not more than three business days prior to such Date of Delivery.
(l) ADDITIONAL DOCUMENTS.
At Closing Time and at each Date of Delivery, counsel for the
Underwriters shall have been furnished with such documents and opinions as
they may reasonably require for the purpose of enabling them to pass upon the
issuance and sale of the Underwritten Securities as herein contemplated, or in
order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company in connection with the issuance and sale of
the Underwritten Securities as herein contemplated shall be reasonably
satisfactory in form and substance to Xxxxxxx Xxxxx and counsel for the
Underwriters.
(m) Termination of Terms Agreement.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, the applicable Terms Agreement
(or, with respect to the Underwriters' exercise of any applicable over-
allotment option for the purchase of Option Underwritten Securities on a Date
of Delivery after the Closing Time, the obligations of the Underwriters to
purchase the Option Underwritten Securities on such Date of Delivery) may be
terminated by Xxxxxxx Xxxxx by notice to the Company at any time at or prior
to the Closing Time (or such Date of Delivery, as applicable), and such
termination shall be without liability of any party to any other party except
as provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive
any such termination and remain in full force and effect.
SECTION 6. INDEMNIFICATION
(a) INDEMNIFICATION OF UNDERWRITERS.
The Company agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(1) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information and the Rule 434 Information deemed to be a part
thereof, if applicable, or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(2) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission; provided that (subject to
Section 6(d) below) any such settlement is effected with the written
consent of the Company; and
(3) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Xxxxxxx
Xxxxx), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such
expense is not paid under (1) or (2) above;
provided, however, that this indemnity agreement shall not apply to
-------- -------
any loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through Xxxxxxx Xxxxx expressly for use in the
Registration Statement (or any amendment thereto), including the 430A
Information and the Rule 434 Information deemed to be a part thereof, if
applicable, or any preliminary prospectus or the Prospectus (or any amendment
or supplement thereto); provided, further, that the foregoing indemnity with
respect to the preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) shall not inure to the benefit of any Underwriter from
whom the person asserting any such loss, claim, damage or liability purchased
the Underwritten Securities or any Underlying Securities, if applicable, that
are the subject thereof if such person did not receive a copy of the
preliminary prospectus or Prospectus (or any amendment or supplement thereto)
at, or prior to, the confirmation of the sale to such person in any case where
such delivery is required by the 1933 Act or any Blue Sky or other state
securities act, and
the untrue statement or omission, or alleged untrue statement or omission, of
a material fact contained in such preliminary prospectus or Prospectus (or any
amendment or supplement thereto) was corrected in the document the Underwriter
did not deliver.
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS.
Each Underwriter severally agrees to indemnify and hold harmless the
Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act against
any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements
or omissions, made in the Registration Statement (or any amendment thereto),
including the Rule 430A Information and the Rule 434 Information deemed to be
a part thereof, if applicable, or any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity
with written information furnished to the Company by such Underwriter through
Xxxxxxx Xxxxx expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION.
Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify
an indemnifying party shall not relieve such indemnifying party from any
liability hereunder to the extent it is not materially prejudiced as a result
thereof and in any event shall not relieve it from any liability which it may
have otherwise than on account of this indemnity agreement. In the case of
parties indemnified pursuant to Section 6(a) above, counsel to the indemnified
parties shall be selected by Xxxxxxx Xxxxx, and, in the case of parties
indemnified pursuant to Section 6(b) above, counsel to the indemnified parties
shall be selected by the Company. An indemnifying party may participate at
its own expense in the defense of any such action; provided, however, that
counsel to the indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party. In no event
shall the indemnifying parties be liable for fees and expenses of more than
one counsel (in addition to any local counsel) separate from their own counsel
for all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances. No indemnifying party
shall, without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or
Section 7 hereof (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim 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 any indemnified party.
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE.
If at any time an indemnified party shall have requested an indemnifying
party to reimburse the indemnified party for fees and expenses of counsel,
such indemnifying party agrees that it shall be liable for any settlement of
the nature contemplated by Section 6(a)(2) effected without its written
consent if (i) such settlement is entered into more than 45 days after receipt
by such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall have received notice of the terms of such settlement at least 30
days prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with such
request prior to the date of such settlement.
SECTION 7. CONTRIBUTION
If the indemnification provided for in Section 6 hereof is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company, on the one hand, and
the Underwriters, on the other hand, from the offering of the Underwritten
Securities pursuant to the applicable Terms Agreement or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company, on
the one hand, and of the Underwriters, on the other hand, in connection with
the statements or omissions which resulted in such losses, liabilities,
claims, damages or expenses, as well as any other relevant equitable
considerations.
The relative benefits received by the Company, on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of such Underwritten Securities (before deducting expenses)
received by the Company and the total underwriting discount received by the
Underwriters, in each case as set forth on the cover of the Prospectus, or, if
Rule 434 is used, the corresponding location on the Term Sheet bear to the
aggregate initial public offering price of such Underwritten Securities as set
forth on such cover.
The relative fault of the Company, on the one hand, and the Underwriters,
on the other hand, shall be determined by reference to, among other things,
whether 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 or by the Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 7. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 7 shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Underwritten 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 0000 Xxx) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter,
and each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
shall have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the number or aggregate principal amount, as the case may be, of
Initial Underwritten Securities set forth opposite their respective names in
the applicable Terms Agreement, and not joint.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY
All representations, warranties and agreements contained in this
Underwriting Agreement or the applicable Terms Agreement or in certificates of
officers of the Company submitted pursuant hereto or thereto shall remain
operative and in full force and effect, regardless of any investigation made
by or on behalf of any Underwriter or controlling person, or by or on behalf
of the Company, and shall survive delivery of and payment for the Underwritten
Securities.
SECTION 9. TERMINATION
(a) UNDERWRITING AGREEMENT.
This Underwriting Agreement (excluding the applicable Terms Agreement)
may be terminated for any reason at any time by the Company or by Xxxxxxx
Xxxxx upon the giving of 30 days' prior written notice of such termination to
the other party hereto.
(b) TERMS AGREEMENT.
Xxxxxxx Xxxxx may terminate the applicable Terms Agreement, by notice to
the Company, at any time at or prior to the Closing Time or any relevant Date
of Delivery, if (i) there has been, since the time of execution of such Terms
Agreement or since the respective dates as of which information is given in
the Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings,
or business affairs of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii)
there has occurred any material adverse change in the financial markets in the
United States or, if the Underwritten Securities or any related Underlying
Securities include Debt Securities denominated or payable in, or indexed to,
one or more foreign or composite currencies, in the international financial
markets, or any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development involving a prospective change
in national or international political, financial or economic conditions, in
each case the effect of which is such as to make it, in the judgment of
Xxxxxxx Xxxxx, impracticable to market the Underwritten Securities or to
enforce contracts for the sale of the Underwritten Securities, or (iii)
trading in any securities of the Company has been suspended or limited by the
Commission or the New York Stock Exchange or, if trading generally on the New
York Stock Exchange or the American Stock Exchange or in the Nasdaq National
Market has been suspended or limited, or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices have been required, by either of
said exchanges or by such system or by order of the Commission, the NASD or
any other governmental authority, or (iv) a banking moratorium has been
declared by either Federal or New York authorities or, if the Underwritten
Securities or any related Underlying Securities include Debt Securities
denominated or payable in, or indexed to, one or more foreign or composite
currencies, by the relevant authorities in the related foreign country or
countries.
(c) LIABILITIES.
If this Underwriting Agreement or the applicable Terms Agreement is
terminated pursuant to this Section 9, such termination shall be without
liability of any party to any other party except as provided in Section 4
hereof, and provided further that Sections 1, 6, 7 and 8 shall survive such
termination and remain in full force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS
If one or more of the Underwriters shall fail at the Closing Time or
the relevant Date of Delivery, as the case may be, to purchase the
Underwritten Securities which it or they are obligated to purchase under the
applicable Terms Agreement (the "Defaulted Securities"), then Xxxxxxx Xxxxx
shall have the right, within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Securities in such
amounts as may be agreed upon and
upon the terms herein set forth; if, however, Xxxxxxx Xxxxx shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number or aggregate principal amount, as the case may
be, of Defaulted Securities does not exceed 10% of the number or
aggregate principal amount, as the case may be, of Underwritten
Securities to be purchased on such date pursuant to such Terms
Agreement, the non-defaulting Underwriters shall be obligated, severally
and not jointly, to purchase the full amount thereof in the proportions
that their respective underwriting obligations under such Terms
Agreement bear to the underwriting obligations of all non-defaulting
Underwriters, or
(b) if the number or aggregate principal amount, as the case may
be, of Defaulted Securities exceeds 10% of the number or aggregate
principal amount, as the case may be, of Underwritten Securities to be
purchased on such date pursuant to such Terms Agreement, such Terms
Agreement (or, with respect to the Underwriters' exercise of any
applicable over-allotment option for the purchase of Option Underwritten
Securities on a Date of Delivery after the Closing Time, the obligations
of the Underwriters to purchase, and the Company to sell, such Option
Underwritten Securities on such Date of Delivery) shall terminate
without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in (i) a
termination of the applicable Terms Agreement or (ii) in the case of a Date of
Delivery after the Closing Time, a termination of the obligations of the
Underwriters and the Company with respect to the related Option Underwritten
Securities, as the case may be, either Xxxxxxx Xxxxx or the Company shall have
the right to postpone the Closing Time or the relevant Date of Delivery, as
the case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or the Prospectus or in any
other documents or arrangements.
SECTION 11. NOTICES
All notices and other communications hereunder shall be in writing
and shall be deemed to have been duly given if mailed or transmitted by any
standard form of telecommunication. Notices to the Underwriters shall be
directed to Xxxxxxx Xxxxx at World Financial Center, Xxxxx Xxxxx, Xxx Xxxx,
Xxx Xxxx 00000-0000
attention of: Xxxx Xxxxx, Director, with a copy to Xxxxx & Xxxxxxx L.L.P., 000
Xxxxxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000-0000, Attention: J. Xxxxxx
Xxxxxxx, Xx., and notices to the Company shall be directed to it at: The CRI
Building, 00000 Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention:
Xxxxxxx X. Xxxxxx, Senior Vice President, with a copy to Xxxxxxx & Berlin,
Chartered, 0000 X Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000, Attention: Xxxxxx X.
XxXxx, Xx.
SECTION 12. PARTIES
This Underwriting Agreement and the applicable Terms Agreement shall
each inure to the benefit of and be binding upon the Company, Xxxxxxx Xxxxx
and, upon execution of such Terms Agreement, any other Underwriters and their
respective successors. Nothing expressed or mentioned in this Underwriting
Agreement or such Terms Agreement is intended or shall be construed to give
any person, firm or corporation, other than the Underwriters and the Company
and their respective successors and the controlling persons and officers and
directors referred to in Sections 6 and 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Underwriting Agreement or such Terms Agreement or any
provision herein or therein contained. This Underwriting Agreement and such
Terms Agreement and all conditions and provisions hereof and thereof are
intended to be for the sole and exclusive benefit of the parties hereto and
thereto and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Underwritten
Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME
THIS UNDERWRITING AGREEMENT AND ANY APPLICABLE TERMS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. EFFECT OF HEADINGS
The Article and Section headings herein and the Table of Contents
are for convenience only and shall not affect the construction hereof.
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
Underwriting Agreement, along with all counterparts, will become a binding
agreement between Xxxxxxx Xxxxx and the Company in accordance with its terms.
Very truly yours,
CRIIMI MAE Inc.
By:
----------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first
above written:
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By:
---------------------------------
Authorized Signatory
TABLE OF CONTENTS
Page
SECTION 1. Representations and Warranties.......................4
(a) Representations and Warranties by the Company............4
(i) Compliance with Registration Requirements............4
(ii) Incorporated Documents...............................5
(iii) Independent Accountants..............................6
(iv) Financial Statements.................................6
(v) No Material Adverse Change in Business...............6
(vi) Good Standing of the Company.........................7
(vii) Good Standing of Subsidiaries........................7
(viii) Capitalization.......................................8
(ix) Qualification as a REIT..............................8
(x) Authorization of this Underwriting Agreement
and Terms Agreement................................8
(xi) Authorization of Common Stock........................8
(xii) Authorization of Preferred Stock.....................9
(xiii) Authorization of Subordinated Debt Securities........9
(xiv) Authorization of the Indentures......................9
(xv) Descriptions of the Underwritten Securities,
Underlying Securities and Indentures...............10
(xvi) Absence of Defaults and Conflicts...................10
(xvii) Absence of Labor Dispute............................11
(xviii) Absence of Proceedings..............................11
(xix) Accuracy of Exhibits................................12
(xx) Absence of Further Requirements.....................12
(xxi) Possession of Intellectual Property.................12
(xxii) Possession of Licenses and Permits..................12
(xxiii) Title to Property...................................13
(xxiv) Commodity Exchange Act..............................13
(xxv) Investment Company Act..............................14
(xxvi) Environmental Laws..................................14
(xxvii) Tax Compliance......................................14
(xxviii) Absence of Price Manipulation.......................15
(xxix) Compliance with Cuba Act............................15
(xxx) Insurance...........................................15
(xxxi) Absence of Unlawful Contributions...................15
(xxxii) Transactions Between Company and Officers
and Directors....................................15
(xxxiii) ERISA Underwritten Securities.......................16
(b) Officers' Certificates....................................16
SECTION 2. Sale and Delivery to Underwriters; Closing..........16
(a) Underwritten Securities...................................16
(b) Option Underwritten Securities............................16
(c) Payment...................................................17
(d) Denominations; Registration...............................18
SECTION 3. Covenants of the Company............................18
(a) Compliance with Securities Regulations and
Commission Requests....................................18
(b) Filing of Amendments......................................19
(c) Delivery of Registration Statements.......................19
(d) Delivery of Prospectuses..................................19
(e) Continued Compliance with Securities Laws.................19
(f) Blue Sky Qualifications...................................20
(g) Earnings Statement........................................20
(h) Reservation of Securities.................................21
(i) Use of Proceeds...........................................21
(j) Listing...................................................21
(k) Restriction on Sale of Securities.........................21
(l) Reporting Requirements....................................21
SECTION 4. Payment of Expenses.................................22
(a) Expenses..................................................22
(b) Termination of Agreement..................................22
SECTION 5. Conditions of Underwriters' Obligations.............23
(a) Effectiveness of Registration Statement...................23
(b) Opinion of Counsel for Company............................23
(c) Opinion of Counsel for Underwriters.......................24
(d) Officers' Certificate.....................................24
(e) Accountant's Comfort Letter...............................24
(f) Bring-down Comfort Letter.................................25
(g) Ratings...................................................25
(h) Approval of Listing.......................................25
(i) No Objection..............................................25
(j) Lock-up Agreements........................................26
(k) Over-Allotment Option.....................................26
(l) Additional Documents......................................26
(m) Termination of Terms Agreement............................27
SECTION 6. Indemnification.....................................27
(a) Indemnification of Underwriters...........................27
(b) Indemnification of Company, Directors and Officers........28
(c) Actions against Parties; Notification.....................29
(d) Settlement without Consent if Failure to Reimburse........29
SECTION 7. Contribution........................................30
SECTION 8. Representations, Warranties and Agreements to
Survive Delivery.................................31
SECTION 9. Termination.........................................32
(a) Underwriting Agreement....................................32
(b) Terms Agreement...........................................32
(c) Liabilities...............................................32
SECTION 10. Default by One or More of the Underwriters.........33
SECTION 11. Notices............................................34
SECTION 12. Parties............................................34
SECTION 13. Governing Law and Time.............................34
SECTION 14. Effect of Headings.................................35
Exhibit A
CRIIMI MAE INC.
(a Maryland corporation)
Common Stock, Preferred Stock, and Debt Securities
[FORM OF TERMS AGREEMENT]
March ___, 1997
To: CRIIMI MAE INC.
00000 Xxxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
We understand that CRIIMI MAE Inc., a Maryland corporation (the
"Company"), proposes to issue and sell 4,500,000 shares of its common stock,
par value $.01 per share (the "Common Stock") such securities also being
hereinafter referred to as the "Underwritten Securities"). Subject to the
terms and conditions set forth or incorporated by reference herein, we the
underwriters named below (the "Underwriters") offer to purchase, severally and
not jointly, the 4,500,000 shares of Underwritten Securities opposite our
names set forth below at the purchase price set forth below, and a
proportionate share of Option Underwritten Securities set forth below, to the
extent any are purchased.
Number of
Underwriter Common Shares
----------- -------------
Merrill, Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated
Friedman, Billngs, Xxxxxx & Co., Inc.
Xxxxxx Brothers Inc.
BT Securities Corporation
Total 4,500,000
---------
The Underwritten Securities shall have the following terms:
Title: Common Stock
Number of shares: 4,500,000
Number of Option Underwritten Securities: 675,000
Initial public offering price per share: $
Purchase price per share: $
Listing requirements: NYSE
Lock-up provisions: 90 days (except for issuances by CRIIMI MAE
pursuant to stock option (including stock option
grants) or dividend reinvestment plans in effect
on the date hereof, upon conversion of CRIIMI MAE
preferred stock outstanding on the date hereof,
or issuances pursuant to the Preferred Stock
Purchase Agreement between CRIIMI MAE Inc. and
MeesPierson Clearing Services, B.V. dated as
of _____________, 1997).
Other terms and conditions:
Closing date and location: March 27, 1997, Xxxxx & Xxxxxxx, L.L.P.
Please accept this offer no later than 5:00 o'clock P.M. (New York City time)
on March 24, 1997 by signing a copy of this Terms Agreement in the space set
forth below and returning the signed copy to us.
Very truly yours,
XXXXXXX LYNCH, PIERCE, XXXXXX &
XXXXX INCORPORATED
By:
-----------------------------
Authorized Signatory
Acting on behalf of itself and the
other named Underwriters.
Accepted:
CRIIMI MAE INC.
By:
---------------------
Name:
Title:
Exhibit B
[FORM OF OPINION OF COUNSEL TO THE COMPANY]
Draft Dated
March 25, 1997
March ____, 1997
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
XXXXXX BROTHERS INC.
BT SECURITIES CORPORATION
c/o Merrill Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Re: CRIIMI MAE Inc. Offering of Common Stock
Ladies and Gentlemen:
We have acted as counsel to CRIIMI MAE Inc., a Maryland corporation (the
"Company"), in connection with the sale by the Company of up to 5,175,000
shares (including 675,000 shares subject to the Underwriters' over-allotment
option) of Common Stock of the Company, par value $.01 per share (the "Common
Shares"), and in connection with the registration under the Securities Act of
1933, as amended (the "Securities Act"), of the Common Shares. The Common
Shares are being sold by the Company pursuant to the Underwriting Agreement,
dated March ___, 1997 (the "Underwriting Agreement"), among the Company,
Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated,
Friedman, Billings, Xxxxxx & Co., Inc., Xxxxxx Brothers Inc. and BT Securities
Corporation. All capitalized terms used herein which are not otherwise
defined shall have the meanings given to them in the Underwriting Agreement.
This opinion is furnished to you pursuant to Section 5(b) of the Underwriting
Agreement.
In rendering this opinion, we have examined and relied upon the
originals, or copies certified or otherwise identified to our satisfaction,
of: (i) the Company's Registration Statement, Prospectus and Prospectus
Supplement; (ii) the Underwriting Agreement; and (iii) such corporate records,
certificates, documents and other instruments, and such certificates or
comparable documents of public officials and of officers and other
representatives of the Company as we have deemed relevant and necessary as a
basis for the opinions hereinafter set forth.
In such examination, we have assumed, without independent investigation
or verification, the legal capacity of all natural persons, the genuineness of
all signatures, the authenticity of all documents submitted to us as
originals, the conformity to original documents of documents submitted to us
as certified or photostatic copies and the authenticity of the originals of
such latter documents, and the conformity of final documents to the forms
submitted to us for review. In making our examination of documents executed
by parties other than the Company, we have assumed that such parties thereto
had the power and authority, corporate, partnership or other, to enter into
and perform all obligations thereunder and have also assumed the due
authorization, execution and delivery by such parties of such documents and
the validity, binding effect and enforceability thereof. We have relied upon
the representations and statements of officers and other representatives of
the Company with respect to the factual determinations underlying the legal
conclusions set forth herein. We have made no independent investigation of
any such representations and statements.
The opinions expressed in numbered paragraphs 1, 2, 3 and 4 below
concerning the qualification to do business and the good standing of the
Company and each of CRI Liquidating REIT, Inc., CRIIMI, Inc., CRIIMI MAE
Management, Inc., CRIIMI MAE Financial Corporation, CRIIMI MAE Financial
Corporation II, CRIIMI MAE Financial Corporation III, CRIIMI MAE Services
Corporation and CRIIMI MAE Services Limited Partnership (each, a "Subsidiary")
are based solely on our review of good standing certificates issued by the
applicable state governmental authorities, copies of which are attached hereto
as Exhibit A.
Whenever our opinion herein is indicated to be based on our knowledge, or
on information known to us, and subject to the further limitations expressly
referred to in numbered paragraph 14 below, we intend to signify that during
the course of our representation of the Company in connection with the
offering of the Common Shares, no information has come to the attention of the
attorneys in this firm who have had significant involvement in such
transaction, Xxxxxx X. XxXxx, Xx., Xxxxxx X. Xxxxxx, Xxxx X. Xxxxxxxx, Xxxx X.
Xxxxxxxxx and Xxxxx X. Xxxxxx, which has given any of them current, actual
knowledge inconsistent with such opinion, and that we have undertaken no
independent investigation to determine facts bearing on such opinion, and no
inference as to our knowledge of facts should be drawn from such
representation.
This opinion does not relate to any law other than the laws of the State
of Maryland (excluding choice of law principles) and the federal laws of the
United States of America as currently in effect. To the extent that laws
other than the foregoing are applicable with respect to matters set forth in
this opinion, we have assumed that such laws are either identical to, or would
be applied in a manner consistent with, the laws of the State of Maryland. We
assume no obligation to supplement or modify this letter if any applicable law
changes in any manner. We express no opinion with respect to the compliance
or noncompliance with state securities laws, rules and regulations or with the
antifraud provisions of state and federal securities laws, rules and
regulations.
Based on the foregoing, and subject to the assumptions and qualifications
set forth herein, it is our opinion that:
(1) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Maryland.
(2) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under, or as
contemplated under, the Underwriting Agreement and the applicable Terms
Agreement.
(3) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction identified on
Exhibit ____.
(4) Each Subsidiary has been duly incorporated or formed and is
validly existing as a corporation or limited partnership in good standing
under the laws of the jurisdiction of its incorporation or formation, has
corporate or limited partnership 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 partnership to transact
business and is in good standing in each jurisdiction identified on Exhibit
___ hereto. Except as otherwise stated in the Registration Statement and the
Prospectus, all of the issued and outstanding capital stock or partnership
interest of each Subsidiary has been duly authorized and is validly issued,
fully paid and non-assessable and, to the best of our knowledge, is owned by
the Company, directly or through subsidiaries, free and clear of any perfected
security interest, mortgage, pledge, lien, encumbrance, claim or equity. None
of the outstanding shares of capital stock or partnership interest of any
Subsidiary was issued in violation of any statutory preemptive or, to our
knowledge, any other similar rights of any securityholder of such Subsidiary.
(5) The authorized, issued and outstanding shares of capital stock of
the Company is as set forth in the column entitled "Actual" under the caption
"Capitalization" (except for subsequent issuances thereof, if any,
contemplated under the Underwriting Agreement, pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectus or pursuant
to the exercise of convertible securities or options referred to in the
Prospectus). Such shares of capital stock have been duly authorized and
validly issued by the Company and are fully paid and non-assessable, and none
of such shares of capital stock were issued in violation of any statutory
preemptive or, to our knowledge, any other similar rights of any
securityholder of the Company.
(6) The Underwriting Agreement and the applicable Terms Agreement
have been duly authorized, executed and delivered by the Company.
(7) The Underwritten Securities have been duly authorized by the
Company for issuance and sale pursuant to the Underwriting Agreement and the
applicable Terms Agreement. The Underwritten Securities, when issued and
delivered by the Company pursuant to the Underwriting Agreement and such Terms
Agreement against payment of the consideration therefor specified in such
Terms Agreement, will be validly issued, fully paid and non-assessable and
will not be subject to any statutory preemptive or, to our knowledge, any
other similar rights of any securityholder of the Company. No holder of the
Underwritten Securities is or will be subject to personal liability by reason
of being such a holder. The form of certificate used to evidence the
Underwritten Securities is in valid form and complies with the applicable
requirements of the Maryland General Corporation Law, with any applicable
requirements of the charter or by-laws of the Company and with the
requirements of the New York Stock Exchange.
[(8) The Underwritten Securities have been duly authorized by the
Company for issuance and sale pursuant to the Underwriting Agreement and the
applicable Terms Agreement. The applicable Preferred Stock, when issued and
delivered by the Company pursuant to the Underwriting Agreement and such Terms
Agreement against payment of the consideration specified in such Terms
Agreement, will be validly issued, fully paid and non-assessable and will not
be subject to any statutory preemptive or, to our knowledge, any other similar
rights of any securityholder of the Company. No holder of such Preferred
Stock is or will be subject to personal liability by reason of being such a
holder. The form of certificate used to evidence the Preferred Stock is in
valid form and complies with the applicable requirements of the Maryland
General Corporation Law, with any applicable requirements of the charter or
by-laws of the Company and with the requirements of the New York Stock
Exchange. The applicable Articles Supplementary are in full force and
effect.]
[(9) The Underwritten Securities have been duly authorized by the
Company for issuance and sale pursuant to the Underwriting Agreement and the
applicable Terms Agreement. The Underwritten Securities, when issued and
authenticated in the manner provided for in the applicable Indenture and
delivered against payment of the consideration therefor specified in such
Terms Agreement, will constitute valid and legally binding obligations of the
Company, enforceable against the Company in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance moratorium or other similar laws
relating to or affecting rights or remedies of creditors and other obligees
generally or by general equitable principles, and except further as
enforcement thereof may be limited by (A) requirements that a claim with
respect to any subordinated Debt Securities denominated other than in U.S.
dollars (or a foreign or composite currency judgment in respect of such claim)
be converted into U.S. dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law or (B) governmental authority to limit,
delay or prohibit the making of payments outside the United States. The
Underwritten Securities are in the form contemplated by, and each registered
holder thereof is entitled to the benefits of, the applicable Indenture.]
[(10) The applicable Indenture has been duly authorized, executed and
delivered by the Company and (assuming due authorization, execution and
delivery thereof by the applicable Trustee) constitutes a valid and legally
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance moratorium or
other similar laws relating to or affecting rights or remedies of creditors
and other obligees generally or by general equitable principles.]
[(11) The Underlying Securities have been duly authorized and
reserved for issuance by the Company upon exercise of the Preferred Stock or
Subordinated Debt Securities. The Underlying Securities, when issued upon
such conversion, will be validly issued, fully paid and non-assessable and
will not be subject to preemptive or other similar rights of any
securityholder of the Company. No holder of the Underlying Securities is or
will be subject to personal liability by reason of being such a holder. The
Underlying Securities have been duly authorized for issuance by the Company
upon conversion of the related Preferred Stock. The Underlying Securities,
when issued and authenticated in the manner provided for in the applicable
Indenture and delivered in accordance with the terms of the related Preferred
Stock will constitute valid and legally binding obligations of the Company,
enforceable against the Company in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance moratorium or other similar laws relating to or
affecting rights or remedies of creditors and other obligees generally or by
general equitable principles, and except further as enforcement thereof may be
limited by (A) requirements that a claim with respect to any Debt Securities
denominated other than in U.S. dollars (or a foreign or composite currency
judgment in respect of such claim) be converted into U.S. dollars at a rate of
exchange prevailing on a date determined pursuant to applicable law or (B)
governmental authority to limit, delay or prohibit the making of payments
outside the United States.]
(12) The Underwritten Securities being sold pursuant to the
applicable Terms Agreement [and the each applicable Indenture] conform [, and
any Underlying Securities, when issued and delivered in accordance with the
terms of the related Underwritten Securities, will conform,] in all material
respects to the legal description thereof contained in the Prospectus and are
in substantially the form filed or incorporated by reference, as the case may
be, as an exhibit to the Registration Statement.
(13) The information in the Prospectus under "Description of Capital
Stock - Common Shares" [and "Description of Underlying Securities," if any, or
any caption purporting to describe any such Securities,] "Certain United
States Federal Income Tax Considerations" and in the Annual Report on Form
10-K under "Legal Proceedings" and in the Registration Statement under Item
15, to the extent that it constitutes matters of law, summaries of legal
matters, the Company's charter and bylaws or legal proceedings, has been
reviewed by us and is correct in all material respects and our opinion set
forth under "Certain United States Federal Income Tax Considerations" is
confirmed.
(14) To our knowledge, (a) neither the Company nor any of the
Subsidiaries is in violation of its charter, by-laws or partnership agreement
and (b) no default by the Company or any of the Subsidiaries exists in the due
performance or observance of any material obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan agreement,
note, lease or other agreement or instrument that is described or referred to
in the Registration Statement or the Prospectus or filed or incorporated by
reference as an exhibit to the Registration Statement.
(15) The execution, delivery and performance of the Underwriting
Agreement and the applicable Terms Agreement [and the applicable Indenture]
and the consummation of the transactions contemplated in the Underwriting
Agreement and such Terms Agreement (including the issuance and sale of the
Underwritten Securities and the use of the proceeds from the sale of the
Underwritten Securities as described under the caption "Use of Proceeds") and
compliance by the Company with its obligations thereunder (i) to our
knowledge, do not and will not, whether with or without the giving of notice
or passage of time or both, violate or constitute a breach of, or default or
Repayment Event under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of its
Subsidiaries pursuant to, any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or any other agreement or instrument
identified on Exhibit B hereto, which Exhibit includes all material agreements
and instruments of the Company and its Subsidiaries known to us, to which the
Company or any of its Subsidiaries is a party or by which it or any of them
may be bound, or to which any of the assets, properties or operations of the
Company or any of its Subsidiaries is subject, except for such conflicts,
breaches, defaults, events or liens, charges or encumbrances that would not
result in a Material Adverse Effect, (ii) do not and will not result in any
violation of the provisions of the charter, by-laws or partnership agreement
of the Company or any of its Subsidiaries and (iii to our knowledge, based
upon our review of those United States and Maryland laws, rules and
regulations which, in our experience, are normally applicable to transactions
of the type contemplated by the Underwriting Agreement and the applicable
Terms Agreement, do not and will not result in any violation of any applicable
law, statute, rule, regulation, judgment, order, writ or decree, of any United
States or Maryland government, government instrumentality or court, domestic
or foreign, having jurisdiction over the Company or any of its subsidiaries or
any of their assets, properties or operations, except for such violations that
would not result in a Material Adverse Effect.
(16) To our knowledge, there is not pending or threatened any action,
suit, proceeding, inquiry or investigation to which the Company or any of its
Subsidiaries is a party or to which the assets, properties or operations of
the Company or any of its Subsidiaries is subject, before or by any court or
governmental agency or body, domestic or foreign, which might reasonably be
expected to result in a Material Adverse Effect or which might reasonably be
expected to materially and adversely affect the consummation of the
transactions contemplated under the Underwriting Agreement, the applicable
Terms Agreement or the performance by the Company of its obligations
thereunder.
(17) To our knowledge, there are no franchises, contracts,
indentures, mortgages, loan agreements, notes, leases or other instruments
required to be described or referred to in the Registration Statement or to be
filed as exhibits thereto other than those described or referred to therein or
filed or incorporated by reference as exhibits thereto, and the descriptions
thereof or references thereto are correct in all material respects.
(18) The Registration Statement has been declared effective under the
1933 Act. Any required filing of the Prospectus pursuant to Rule 424(b) has
been made in the manner and within the time period required by Rule 424(b).
To our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933 Act and no proceedings
for that purpose have been initiated or are pending or threatened by the
Commission.
(19) The Registration Statement and the Prospectus, excluding the
documents incorporated by reference therein, and each amendment or supplement
to the Registration Statement and Prospectus, excluding the documents
incorporated by reference therein, as of their respective effective or issue
dates complied as to form in all material respects with the applicable
requirements of the 1933 Act and the 1933 Act Regulations, as applicable, and
the rules and regulations of the Commission thereunder; provided, however,
that we express no view as to (i) the financial statements and the financial
statement schedules contained or incorporated by reference therein or omitted
therefrom (including the notes to the financial statements and the auditors'
reports on the financial statements) and (ii) the other financial or
statistical information contained or incorporated by reference therein or
omitted therefrom (including the information set forth under "Price Range of
Common Shares and Dividends -- Historical Return" and the estimated weighted
average unleveraged yield).
(20) The documents incorporated by reference in the Prospectus when
they became effective or were filed with the Commission, as the case may be,
complied as to form in all material respects with the requirements of the 1933
Act or the 1934 Act, as applicable, and the rules and regulations of the
Commission thereunder provided, however, that we express no view as to (i) the
financial statements and the financial statement schedules contained or
incorporated by reference therein or omitted therefrom (including the notes to
the financial statements and the auditors' reports on the financial
statements) and (ii) the other financial or statistical information contained
or incorporated by reference therein or omitted therefrom (including the
information set forth under "Price Range of Common Shares and Dividends --
Historical Return" and the estimated weighted average unleveraged yield).
(21) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any United States or Maryland
court or governmental authority or agency, domestic or foreign, is necessary
or required for the performance by the Company of its obligations under the
Underwriting Agreement or the applicable Terms Agreement or in connection with
the transactions contemplated under the Underwriting Agreement, or such Terms
Agreement other than under the 1933 Act, the 1933 Act Regulations, the 1934
Act and the 1934 Act Regulations, which have been obtained, or as may be
required under state securities or blue sky laws or regulations.
(22) Neither the Company nor any of its Subsidiaries is required to
register as an "investment company" within the meaning of the Investment
Company Act of 1940, as amended. In rendering this opinion, we note the
following: a substantial portion of the Company's assets comprise Subordinated
CMBS. Under current interpretation by the staff of the Commission, in order
to qualify for an exemption for entities that are "primarily engaged in the
business of purchasing or otherwise acquiring mortgages and other liens on and
interests in real estate" ("Qualifying Interests"), the Company, among other
things, must maintain at least 55% of its assets in Qualifying Interests.
Although there is no specific authority on this point of which we are aware,
based on the control, work-out, foreclosure and other rights and arrangements
associated with the Company's Subordinated CMBS as well as the attributes of
such mortgage assets, we believe that such Subordinated CMBS constitute
"Qualifying Interests" for purposes of such exemption.
(23) The Company has been organized and, based solely on the
description of the Company's operations contained in the Registration
Statement, as supplemented by the Prospectus Supplement, and on
representations of officers of the Company, is operating in conformity with
the requirements for qualification as a REIT under the Code. If the Company
continues to operate in the manner in which it has to date, and if the Company
is operated according to the policies and in the manner stated in the
Prospectus (included in the Registration Statement) and the Prospectus
Supplement, the Company will continue to qualify as a REIT pursuant to the
Code.
In addition to the foregoing opinions, no facts have come to our
attention which lead us to believe that the registration Statement, or any
amendment thereof, as of the time it became effective under the 1933 Act and
at the Closing Time, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, or that the Prospectus, as amended
or supplemented, as of its date and at the Closing Time, included or includes
an untrue statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading except that we express no view as
to (i) the financial statements and the financial statement schedules
contained or incorporated by reference therein or omitted therefrom (including
the information set forth under "Price Range of Common Shares and Dividends --
Historical Return" and the estimated weighted average unleveraged yield) and
(ii) the other financial or statistical information contained or incorporated
by reference therein or omitted therefrom (including the projected annualized
total returns and the assumptions described therein). We do not, however,
assume any responsibility for the accuracy, completeness or fairness of the
statements made in the registration Statement, the Prospectus or any amendment
or supplement or supplement thereof and we make no representation that we have
independently verified the accuracy, completeness or fairness of such
statements, except to the extent expressly set forth in numbered paragraph 13.
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials.
Such opinion shall not state that it is to be governed or qualified by, or
that it is otherwise subject to, any treatise, written policy or other
document relating to legal opinions, including, without limitation, the Legal
Opinion Accord of the ABA Section of Business Law (1991).
