August 28, 1998
Highwoods Properties, Inc.
0000 Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attn.: Xxxxxx Xxxxxx
Ladies and Gentlemen:
This letter agreement between Highwoods Properties, Inc. (the "Company")
and UBS AG, London Branch ("UB-LB"), as successor to UBS (as defined), acting
through its agent Xxxxxxx Xxxxxx Read LLC, modifies and amends, in part, certain
of the terms and conditions of that certain Forward Stock Purchase Confirmation,
dated August 25, 1997 (the "Forward Agreement") between the Company and Union
Bank of Switzerland, London Branch ("UBS"), as such may have been amended
through the date hereof. Defined terms not otherwise defined herein shall have
the meanings ascribed to them under the Forward Agreement.
Notwithstanding the terms and conditions of the Forward Agreement, the
Company and UB-LB agree as follows:
1. The "Maturity Date" of the Transaction shall be February 28, 1999.
2. In consideration of the agreement to extend the Maturity Date, the Company
shall pay to UB-LB on or before August 28, 1998, a commitment fee of 0.50%
($289,125) of the product obtained by multiplying the Initial Price by the
number of Underlying Shares, plus reasonable legal fees.
3. For the avoidance of doubt:
a) In the definition of "Initial Price" in Section IV of the Forward
Agreement, the term "[closing price]" shall be deleted and replaced by
"$32.125".
b) In the definition of "Mandatory Unwind Thresholds" in Section IV of the
Forward Agreement, the term "Current Price" shall be deleted and replaced by
"Initial Price", and
c) The day of the month referred to in the definitions of "Trade Date",
"Effective Date", and "Reset Dates" shall be the 28th, not the 25th.
4. Notwithstanding any provision of the Forward Agreement to the contrary, under
no circumstances shall the Company be permitted to use common shares to fulfill
any of its obligations under the Forward Agreement after October 12, 1998
(including without limitation, Settlement or Interim Settlement obligations),
unless a registration statement contemplated by Section II.A.5. of the Forward
Agreement is effective with respect to such shares.
5. Effective August 28, 1998, Exhibit A to the Forward Agreement (which contains
financial covenants of the Company, the breach of any of which constitutes a
Mandatory Unwind Event under Section V of the Forward Agreement) shall be
replaced in its entirety by the new Exhibit A that is attached to this letter.
6. a) Before "Mandatory Unwind Event" in Section V, the following provision
shall be added:
Early Settlements
with respect
to Other
Substantially Similar
Transactions: The Company agrees that (i) prior to the early
settlement, unwind or liquidation of any
transaction that is substantially similar to the
transaction contemplated by this Forward Stock
Contract (an "Other Transaction"), the Company
shall promptly, after learning that any such event
may occur, give telephone notice to no less than
two (2) UB-LB officers, one of which must be an
officer of the Real Estate Finance Group
(confirmed in writing by both fax and next day
mail) of such upcoming settlement, unwind or
liquidation, (ii) any such settlement, unwind or
liquidation shall constitute a Mandatory Unwind
Event under clause (ii) of "Mandatory Unwind
Event" in this Section V, and (iii) UBS may
require all or part of the Transaction to be
settled prior to or coincident with such other
Transaction.
b) Subclause (5) of clause (ii) under "Mandatory Unwind Event" in Section V
shall be deleted in its entirety and replaced as follows:
(5) any failure of the Company to post collateral pursuant to Section III
herein,
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c) To clause (ii) under "Mandatory Unwind Event" in Section V, the following
shall be added:
(6) the Company settles, unwinds or liquidates any transaction that is
substantially similar to this Transaction, thus giving rise to a
Mandatory Unwind Event under "Early Settlements with respect to Other
Substantially Similar Transactions" of this Section V, and/or
(7) failure to deliver to UBS on or before October 12, 1998, an effective
registration statement as contemplated by Section II.A.5. above.
7. The agreement of UBS of the modifications and amendments provided for herein
shall not constitute or imply any agreement or undertaking to agree to any other
modification or amendment with respect to the Forward Agreement.
Sincerely,
UBS AG, London Branch:
By:________________________________ By:________________________________
Name: Name:
Title: Title:
Date: Date:
AGREED TO AND ACCEPTED
Highwoods Properties, Inc.
By:_______________________________ By:_________________________________
Name: Name:
Title: Title:
Date: Date:
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UBS, AG London Branch has verbally agreed to extend the deadline for an
effective registration statement relating to the sale of the Shares from October
12, 1998 to November 2, 1998. Such deadline is set forth in Paragraph 4 of the
August 28, 1998 Letter Agreement between the Company and UBS, AG London Branch
