UDR, INC. 5,400,000 Shares 6.75% Series G Cumulative Redeemable Preferred Stock without par value Underwriting Agreement
Exhibit 1.1
Execution Version
5,400,000 Shares
6.75% Series G Cumulative Redeemable
Preferred Stock without par value
6.75% Series G Cumulative Redeemable
Preferred Stock without par value
May 23, 2007
Wachovia Capital Markets, LLC
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Ladies and Gentlemen:
UDR, Inc., a corporation organized under the laws of Maryland (the “Company,” which term, as
used herein, includes its predecessor United Dominion Realty Trust, Inc., a Virginia corporation
(the “Predecessor”)), proposes to issue and sell to the several underwriters named in Schedule A
attached hereto (the “Underwriters”), for whom you (the “Representatives”) are acting as
representatives, 5,400,000 shares of 6.75% Series G Cumulative Redeemable Preferred Stock, no par
value (the “Preferred Stock”), of the Company (said shares to be issued and sold by the Company
being hereinafter called the “Firm Securities”), and for the purpose of covering over-allotments in
connection with the sale of the Firm Securities, at the option of the Representatives, up to an
additional 600,000 shares (the “Option Securities”) of Preferred Stock. The Firm Securities and the
Option Securities are referred to herein as the “Underwritten Securities” or the “Securities.” To
the extent there are no additional Underwriters listed on Schedule A other than you, the term
Representatives as used herein shall mean you, as Underwriter, and the terms Representatives and
Underwriters shall mean either the singular or plural as the context requires. To the extent that
there is only a single Underwriter listed on Schedule A, then references to the “several”
Underwriters shall be disregarded. Certain terms used, and not otherwise defined, herein are
defined in Section 17 hereof.
As used herein, the term “subsidiary” means a corporation, real estate investment trust,
partnership or limited liability company a majority of the outstanding voting stock or beneficial,
partnership or membership interests, as the case may be, of which is owned or controlled, directly
or indirectly, by the Company or by one or more other subsidiaries of the Company, including,
without limitation, United Dominion Realty L.P., a Delaware limited partnership (“UDR Operating
Partnership”), and Heritage Communities L.P., a Delaware limited partnership (“Heritage Operating
Partnership” and, together with UDR Operating Partnership, the “Operating Partnerships”).
The Company has prepared and filed with the Securities and Exchange Commission (the
“Commission”) an automatic shelf registration statement (file number 333-131278) on Form S-3,
covering the registration of certain securities, including the Securities, under the Securities Act
of 1933, as amended (the “1933 Act”), including the related preliminary prospectus, which
registration statement became effective upon filing under Rule 462(e) (“Rule 462(e)”) of the
rules and regulations of the Commission under the 1933 Act (the “1933 Act Regulations”). Such
registration statement, at each time of effectiveness under the 1933 Act and the 1933 Act
Regulations, including post-effective amendments thereto to such time, the exhibits and any
schedules thereto at such time, the documents incorporated or deemed to be incorporated by
reference therein pursuant to Item 12 of Form S-3 under the 1933 Act at such time and the documents
otherwise deemed to be a part thereof pursuant to Rule 430B of the 1933 Act Regulations (“Rule
430B”), excepting therefrom, for purposes of clarity, any free writing prospectus (as defined in
Rule 405 of the 1933 Act Regulations (“Rule 405”), a “free writing prospectus”), is referred to
herein as the “Registration Statement”; provided, however, that all references to
the “Registration Statement” shall be deemed to include information contained in a prospectus
supplement (whether in preliminary or final form) relating to the Securities that is deemed to be a
part of such Registration Statement as of the time specified in Rule 430B, excepting therefrom, for
purposes of clarity, any free writing prospectus. Any information relating to the offering of the
Securities that was omitted from such Registration Statement at the time it originally became
effective but that is deemed to be a part of and included in such registration statement pursuant
to Rule 430B is referred to herein as the “Rule 430B Information.” Each prospectus and prospectus
supplement used in connection with the offering of the Securities that omitted Rule 430B
Information, including the documents incorporated or deemed to be incorporated by reference therein
pursuant to Item 12 of Form S-3 under the 1933 Act, excepting therefrom, for purposes of clarity,
any free writing prospectus, are collectively referred to herein as the “preliminary prospectus.”
Promptly after execution and delivery of this Agreement, the Company will prepare and file a
prospectus supplement relating to the Securities in accordance with the provisions of Rule 430B and
Rule 424(b) of the 1933 Act Regulations (“Rule 424(b)”). The final prospectus and the final
prospectus supplement, in the form first furnished or made available to the Underwriters for use in
connection with the offering of the Securities, including the documents incorporated or deemed to
be incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act at the time
of the execution of this Agreement, excepting therefrom, for purposes of clarity, any free writing
prospectus, are collectively referred to herein as the “Prospectus.” For purposes of this
Agreement, all references to the Registration Statement, any preliminary prospectus or the
Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the
copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
system (“▇▇▇▇▇”).
All references in this Agreement to financial statements (including notes) and schedules and
other information which is “contained,” “included,” “disclosed” or “stated” (or other references of
like import) in the Registration Statement, any preliminary prospectus or the Prospectus shall be
deemed to include all such financial statements (including notes) and schedules and other
information which is incorporated by reference in the Registration Statement, any preliminary
prospectus or the Prospectus at the relevant time of effectiveness, issuance or execution of this
Agreement, as the case may be, pursuant to the Securities Exchange Act of 1934, as amended (the
“1934 Act”), and all references in this Agreement to amendments or supplements to the Registration
Statement, any preliminary prospectus or the Prospectus shall be deemed to include the information
which is incorporated by reference in the Registration Statement, such preliminary prospectus or
the Prospectus, as the case may be, after such time pursuant to the 1934 Act.
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1. Representations and Warranties. The Company represents and warrants to, and agrees
with, each Underwriter as set forth below in this Section 1.
(a) The Registration Statement became effective upon filing under Rule 462(e) on
January 25, 2006. No stop order suspending the effectiveness of the Registration Statement,
or notice objecting to its use, 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.
Any offer that is a written communication relating to the Securities made prior to the
original filing of the Registration Statement by the Company or any person acting on its
behalf (within the meaning, for this paragraph only, of Rule 163(c) of the 1933 Act
Regulations (“Rule 163(c)”)) has been filed with the Commission in accordance with the
exemption provided by Rule 163 of the 1933 Act Regulations (“Rule 163”) and otherwise
complied with the requirements of Rule 163, including, without limitation, the legending
requirement, to qualify such offer for the exemption from Section 5(c) of the 1933 Act
provided by Rule 163.
At the respective times the Registration Statement and each amendment thereto became
effective, at the date of this Agreement, at each “new effective date” within the meaning of
Rule 430B(f)(2) and at the Closing Date (and, if any Option Securities are purchased, at
each Option Closing Date), the Registration Statement and each amendment thereto complied,
comply and will comply in all material respects with the requirements of the 1933 Act and
the 1933 Act Regulations and did not, do 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.
None of any preliminary prospectus, the Prospectus or any amendment or supplement, to
any preliminary prospectus or the Prospectus, at the date of this Agreement, at the time
such preliminary prospectus, the Prospectus or any such amendment or supplement to any
preliminary prospectus or the Prospectus was, is or will be issued or at the Closing Date
(or, if any Option Securities are purchased, at any Option Closing Date), included, includes
or will include an untrue statement of a material fact or omitted, omits or will 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. Each preliminary prospectus and
the prospectus filed as part of the Registration Statement as originally filed or as part of
any amendment thereto, or filed pursuant to Rule 424 of the 1933 Act Regulations, complied
when so filed in all material respects with the 1933 Act Regulations and each preliminary
prospectus and the Prospectus delivered or made available to the Underwriters for use in
connection with this offering was identical to the electronically transmitted copies thereof
filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation
S-T.
At the Applicable Time (as defined below), (i) the Statutory Prospectus (as defined
below) (ii) any Issuer Free Writing Prospectus (as defined below) issued at or prior to the
Applicable Time and (iii) the information agreed to in writing by the
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Company and the Underwriters as the information to be conveyed orally by the
Underwriters to purchasers of Securities at the Applicable Time, all considered together
(collectively, the “Disclosure Package”), did 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.
As used in this subsection and elsewhere in this Agreement:
“Applicable Time” means 4:45 P.M. (New York City time) on May 23, 2007 or such other
time as agreed by the Company and the Underwriters.
“Issuer Free Writing Prospectus” means any “issuer free writing prospectus,” as defined
in Rule 433 (“Rule 433”), relating to the Securities that (i) is required to be filed with
the Commission by the Company, (ii) is a “road show that is a written communication” within
the meaning of Rule 433(d)(8)(i), whether or not required to be filed with the Commission,
or (iii) is exempt from filing pursuant to Rule 433(d)(5)(i) because it contains a
description of the Securities or of the offering thereof that does not reflect the final
terms, in each case in the form filed or required to be filed with the Commission or, if not
required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g).
“Statutory Prospectus” as of any time means the prospectus relating to the Securities
that is included in the Registration Statement immediately prior to such time, including the
documents incorporated by reference therein immediately prior to such time and any
preliminary prospectus relating to the Securities that is deemed to be a part of and
included in the Registration Statement pursuant to Rule 430B immediately prior to such time.
The representations and warranties in this subsection shall not apply to statements in
or omissions from the Registration Statement, the Prospectus or the Disclosure Package made
in reliance upon and in conformity with information furnished to the Company in writing by
any Underwriter through the Representatives expressly for use in the Registration Statement,
the Prospectus or the Disclosure Package.
(b) (A) At the time of the original filing of the Registration Statement, (B) at the
time of the most recent amendment thereto for the purposes of complying with Section
10(a)(3) of the 1933 Act (whether such amendment was by post-effective amendment,
incorporated report filed pursuant to Section 13 or 15(d) of the 1934 Act or form of
prospectus), (C) at the time the Company or any person acting on its behalf (within the
meaning, for this clause only, of Rule 163(c)) made any offer relating to the Securities in
reliance on the exemption of Rule 163 and (D) at the date hereof, the Company was and is a
“well-known seasoned issuer”, as defined in Rule 405, including not having been and not
being an “ineligible issuer”, as defined in Rule 405 (an “Ineligible Issuer”). The
Registration Statement is an “automatic shelf registration statement,” as defined in Rule
405, and the Securities, since their registration on the Registration Statement, have been
and remain eligible for registration by the Company on a Rule 405 “automatic shelf
registration statement”. The Company has not received from
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the Commission any notice pursuant to Rule 401(g)(2) of the 1933 Act Regulations
objecting to the use of the automatic shelf registration statement form.
At the time of the original filing of the Registration Statement, at the earliest time
thereafter that the Company or another offering participant made a bona fide offer (within
the meaning of Rule 164(h)(2) of the 1933 Act Regulations) of the Securities and at the date
of this Agreement, the Company was not and is not an Ineligible Issuer without taking
account of any determination by the Commission pursuant to Rule 405 that it is not necessary
that the Company be considered an Ineligible Issuer.
(c) No Issuer Free Writing Prospectus, if any, as of its issue date or at any time
prior to the completion of the offering and sale of the Securities, unless the Company has
notified the Underwriters pursuant to Section 5(e) hereof, included, includes or will
include any information that conflicted, conflicts or will conflict with the information
contained in the Registration Statement, the Prospectus or any preliminary prospectus,
including any document incorporated by reference therein that has not been superseded or
modified. The foregoing sentence does not apply to statements in or omissions from any such
Issuer Free Writing Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any Underwriter through the Representatives expressly
for use therein.
(d) The Company has not made, used, prepared, authorized, approved or referred to, and
will not make, use, prepare, approve or refer to, any “written communication” (as defined in
Rule 405) in connection with the offering and sale of the Securities other than (A) the
Registration Statement, (B) any preliminary prospectus, (C) the Prospectus, (D) any Issuer
Free Writing Prospectus that has been reviewed and consented to by the Representatives
pursuant to Section 5(f) hereof and attached hereto as Schedule B or (E) any communication
permitted under Rule 134 of the 1933 Act Regulations (“Rule 134”).
(e) The documents incorporated or deemed to be incorporated by reference in the
Registration Statement, the Prospectus or any preliminary 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 Statutory Prospectus, at the time the Registration Statement or any
amendment thereto became effective, at the earlier of the time the Prospectus was first used
or the date and time of the first contract of sale of Securities, and at the Closing Date
(and, if any Option Securities are purchased, at each Option Closing Date), did not, do 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.
(f) Each of the Company and its subsidiaries has been duly incorporated or formed, as
applicable, and is validly existing as a corporation, limited liability company, real estate
investment trust or partnership, as the case may be, in good standing under the laws of the
jurisdiction in which it is chartered or organized with full power and authority
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to own or lease, as the case may be, and to operate its properties and conduct its
business as described in the Registration Statement, the Prospectus or the Disclosure
Package, and is duly qualified to do business as a foreign corporation, limited liability
company, real estate investment trust or partnership, as the case may be, and is in good
standing under the laws of each jurisdiction which requires such qualification (except in
any case in which the failure to so qualify or to be in good standing would not have a
material adverse effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as set forth in or
contemplated in the Registration Statement, the Prospectus or the Disclosure Package
(exclusive of any supplement thereto)).
(g) All the outstanding partnership interests of each Operating Partnership have been
duly authorized and validly issued, are fully paid and (except in the case of general
partnership interests) non-assessable, and, except as otherwise disclosed in the
Registration Statement, the Prospectus and the Disclosure Package and except for minority
interests in the Operating Partnerships described in the Registration Statement, the
Prospectus and the Disclosure Package, are owned by the Company either directly or through
wholly owned subsidiaries free and clear of any perfected security interest or any other
security interests, claims, liens or encumbrances; and the Company and/or one or more
subsidiaries of the Company are the only members or general partners of the Company’s
limited liability company or limited partnership subsidiaries, as applicable, and own the
entire membership or general partnership interest in each such subsidiary free and clear of
any perfected security interest or any other security interests, claims, liens or
encumbrances.
(h) The Company’s authorized equity capitalization is as set forth in the Registration
Statement, the Prospectus and the Disclosure Package; the capital stock of the Company
conforms in all material respects to the description thereof contained in the Registration
Statement, the Prospectus and the Disclosure Package; the outstanding shares of the
Company’s common stock, par value $0.01 per share (the
“Common Stock”), and the outstanding shares of the Company’s preferred stock, no par value per share, have been duly and validly
authorized and issued and are fully paid and nonassessable; the Securities have been duly
and validly authorized for issuance and sale to the Underwriters pursuant to this Agreement
and, when issued and delivered to and paid for by the Underwriters pursuant to this
Agreement, will be validly issued, fully paid and nonassessable; no holder or beneficial
owner of shares of capital stock of the Company will be subject to personal liability by
reason of being such a holder or beneficial owner; the certificates for the Securities are
in valid and sufficient form; the Articles Supplementary relating to the Securities (the
“Articles Supplementary”) will be in full force and effect as of the Closing Date; and the
Securities conform to the provisions of the Articles Supplementary.
(i) Neither the holders of outstanding shares of capital stock of the Company nor the
holders of any of the Company’s other outstanding securities are entitled to preemptive or
other rights to subscribe for the Securities. Except as set forth in the Registration
Statement, the Prospectus and the Disclosure Package, no options, warrants
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or other rights to purchase, agreements or other obligations to issue, or rights to
convert any obligations into or exchange any securities for, shares of capital stock of or
ownership interests in the Company are outstanding.
(j) There is no franchise, contract or other document of a character required to be
described in the Registration Statement or the Prospectus or to be filed as an exhibit to
the Registration Statement or to any report filed with the Commission under the 1934 Act
which has not been so described or filed; and the statements in the Registration Statement,
the Prospectus and the Disclosure Package under the headings “Description of the Series G
Preferred Stock,” “Material U.S. Federal Income Tax Considerations” and “Description of
Preferred Stock”, insofar as such statements constitute matters of law or legal conclusions,
are correct in all material respects.
(k) This Agreement has been duly authorized, executed and delivered by the Company and
constitutes a valid and binding obligation of the Company enforceable in accordance with its
terms, except as enforceability may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium or other laws relating to or affecting enforcement of
creditors’ rights generally or by general equity principles (regardless of whether
enforcement is considered in a proceeding in equity or at law).
(l) The Company is not, and upon the issuance and sale of the Securities as herein
contemplated, the application of any net proceeds therefrom as described in the Registration
Statement, the Prospectus and the Disclosure Package will not be, an “investment company”
within the meaning of the Investment Company Act of 1940, as amended.
(m) No consent, approval, authorization, filing with or order of any court or
governmental agency or regulatory body is required in connection with the transactions
contemplated herein, except such as have been obtained under the 1933 Act or the 1933 Act
Regulations and such as may be required under the blue sky laws of any jurisdiction in
connection with the purchase and distribution of the Securities by the Underwriters in the
manner contemplated herein and in the Registration Statement and the Prospectus.
(n) Neither the issue and sale of the Securities nor the consummation of any other of
the transactions herein contemplated nor the fulfillment of the terms hereof will conflict
with, result in a breach or violation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its subsidiaries pursuant to, (i) the
charter or by-laws or other organizational documents of the Company or any of its
subsidiaries, (ii) the terms of any indenture, contract, lease, mortgage, deed of trust,
note agreement, loan agreement or other agreement, obligation, condition, covenant or
instrument to which the Company or any of its subsidiaries is a party or bound or to which
its or their property is subject (except in any case in which such would not have a material
adverse effect on the condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business, except as set forth in or contemplated
in the Registration Statement, the Prospectus or the Disclosure Package (exclusive of any
supplement thereto)), or (iii) any statute, law, rule, regulation,
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judgment, order or decree applicable to the Company or any of its subsidiaries of any
court, regulatory body, administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company or any of its subsidiaries or any of its or
their properties (except in any case in which such would not have a material adverse effect
on the condition (financial or otherwise), prospects, earnings, business or properties of
the Company and its subsidiaries, taken as a whole, whether or not arising from transactions
in the ordinary course of business, except as set forth in or contemplated in the
Registration Statement, the Prospectus and the Disclosure Package (exclusive of any
supplement thereto)).
(o) No holders of securities of the Company have rights to the registration of such
securities under the Registration Statement.
(p) The financial statements together with related notes and schedules of the Company
and its subsidiaries and of any companies, other entities or properties acquired or to be
acquired by the Company, as set forth or incorporated by reference in the Registration
Statement, the Prospectus or the Disclosure Package, present fairly the financial position,
results of operations and cash flows of the Company and its subsidiaries and of such
companies, entities and properties, as the case may be, at the indicated dates and for the
indicated periods. Such financial statements comply as to form with the applicable
accounting requirements of the 1933 Act and the 1933 Act Regulations and have been prepared
in accordance with United States generally accepted accounting principles (“GAAP”),
consistently applied throughout the periods involved, and all adjustments necessary for a
fair presentation of results for such periods have been made (except to the extent that, in
accordance with the 1934 Act and the 1934 Act Regulations, certain footnotes have been
omitted from the financial statements included in the Company’s Quarterly Reports on Form
10-Q incorporated by reference in the Registration Statement, the Prospectus and the
Disclosure Package). The summary financial and statistical data, if any, included in the
Registration Statement, the Prospectus or the Disclosure Package present fairly the
information shown therein and have been compiled on a basis consistent with the financial
statements presented in the Registration Statement, the Prospectus or the Disclosure
Package; the Company is not required to include any financial statements of any other entity
or business or any pro forma financial statements in the Registration Statement, the
Prospectus or the Disclosure Package under the 1933 Act or the 1933 Act Regulations or in
any document required to be filed with the Commission under the 1934 Act or the 1934 Act
Regulations.
(q) Neither the Company nor any of its subsidiaries has sustained since the date of the
latest audited financial statements included or incorporated by reference in the
Registration Statement, the Prospectus and the Disclosure Package, any material loss or
interference with its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental action, order or
degree, otherwise than as set forth or contemplated in the Registration Statement, the
Prospectus and the Disclosure Package.
(r) Since the respective dates as of which information is given in the Registration
Statement, the Prospectus and the Disclosure Package, there has not been
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any material change in the capital stock, total assets or material increase in the
long-term debt of the Company or any of its subsidiaries, or material change in any dividend
or distribution of any kind declared, set aside for payment, paid or made by the Company on
any class of capital stock, or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs, management,
financial position, shareholders’ equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the Registration Statement, the
Prospectus and the Disclosure Package. Neither the Company nor any of its subsidiaries has
entered into any transaction or agreement not in the ordinary course of business which is
material to the Company and its subsidiaries considered as a whole or incurred any liability
or obligation, direct or contingent, which is material to the Company and its subsidiaries
considered as a whole.
(s) No action, suit or proceeding by or before any court or governmental agency,
authority or regulatory body or any arbitrator involving the Company or any of its
subsidiaries or its or their property is pending or, to the best knowledge of the Company,
threatened that (i) could reasonably be expected to have a material adverse effect on the
performance of this Agreement or the consummation of any of the transactions contemplated
hereby or (ii) could reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in the Registration
Statement, the Prospectus and the Disclosure Package (exclusive of any supplement thereto).
(t) Each of the Company and each of its subsidiaries owns or leases all such properties
as are necessary to the conduct of its operations as presently conducted (except in any case
in which the failure to own or lease any such properties would not have a material adverse
effect on the condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business).
(u) Neither the Company nor any subsidiary is in violation or default of (i) any
provision of its charter or bylaws or other organizational documents, (ii) the terms of any
indenture, contract, lease, mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument to which it is a party or bound or
to which its property is subject (except in any case in which such would not have a material
adverse effect on the condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business, except as set forth in or contemplated
in the Registration Statement, the Prospectus and the Disclosure Package (exclusive of any
supplement thereto)), or (iii) any statute, law, rule, regulation, judgment, order or decree
of any court, governmental agency, regulatory body, administrative agency, arbitrator or
other authority having jurisdiction over the Company or such subsidiary or any of its
properties (except in any case in which such would not have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole,
9
whether or not arising from transactions in the ordinary course of business, except as
set forth in or contemplated in the Registration Statement, the Prospectus and the
Disclosure Package (exclusive of any supplement thereto)), as applicable.
(v) Ernst & Young LLP, who have certified certain financial statements of the Company
and its consolidated subsidiaries and delivered their report with respect to the audited
consolidated financial statements and schedules included in the Registration Statement, the
Prospectus or the Disclosure Package, are independent public accountants with respect to the
Company within the meaning of Rule 101 of the Code of Professional Conduct of the American
Institute of Certified Public Accountants and its interpretations and rulings thereunder,
and to the Company’s knowledge, Ernst & Young LLP has not engaged in any activity with
respect to the Company that is prohibited by any of the subsections (g) through (l) of
Section 10A of the 1934 Act.
(w) There are no transfer taxes or other similar fees or charges under Federal law or
the laws of any state, or any political subdivision thereof, required to be paid in
connection with the execution and delivery of this Agreement or the issuance by the Company
or sale by the Company of the Securities hereunder.
(x) Each of the Company and its subsidiaries has filed all foreign, federal, state and
local tax returns that are required to be filed or has requested extensions thereof (except
in any case in which the failure so to file would not have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in the Registration
Statement, the Prospectus and the Disclosure Package (exclusive of any supplement thereto))
and has paid all taxes required to be paid and any other assessment, fine or penalty levied
against it, to the extent that any of the foregoing is due and payable, except for any such
assessment, fine or penalty that is currently being contested in good faith or as would not
have a material adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Registration Statement, the Prospectus and the Disclosure
Package (exclusive of any supplement thereto).
(y) No labor problem or dispute with the employees of the Company or any of its
subsidiaries exists or, to the Company’s knowledge, is threatened or imminent, that could
have a material adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business, and the Company
is not aware of any existing or imminent labor disturbance by the employees of any of its or
its subsidiaries’ principal suppliers, contractors or customers, that could have a material
adverse effect on the condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business, except as set forth in or contemplated
in the Registration Statement, the Prospectus and the Disclosure Package (exclusive of any
supplement thereto).
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(z) The Company and each of its subsidiaries are adequately insured by insurers of
recognized financial responsibility against all losses and risks (except in any case in
which such would not have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and its subsidiaries,
taken as a whole, whether or not arising from transactions in the ordinary course of
business); all policies of insurance and fidelity or surety bonds insuring the Company or
any of its subsidiaries or their respective businesses, assets, employees, officers and
directors are in full force and effect; the Company and its subsidiaries are in compliance
with the terms of such policies and instruments in all material respects; and there are no
claims by the Company or any of its subsidiaries under any such policy or instrument as to
which any insurance company is denying liability or defending under a reservation of rights
clause (except in any case in which such would not have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in the Registration
Statement, the Prospectus and the Disclosure Package (exclusive of any supplement thereto));
and neither the Company nor any such subsidiary has any reason to believe that it will not
be able to renew its existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary to continue its business
at a cost that would not have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and its subsidiaries,
taken as a whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Registration Statement, the
Prospectus and the Disclosure Package (exclusive of any supplement thereto).
(aa) Except as described in the Registration Statement, the Prospectus and the
Disclosure Package, the Company and its subsidiaries have good and marketable title to all
real properties owned by them (each, a “Property” and collectively, the “Properties”), in
each case free from liens, encumbrances and defects that would materially affect the value
thereof or materially interfere with the use made or to be made thereof by them; the Company
or its subsidiaries have obtained an owner’s title insurance policy in an amount at least
equal to the cost of acquisition from a title insurance company with respect to each of its
real estate properties; except as disclosed in the Registration Statement, the Prospectus
and the Disclosure Package, the Company and its subsidiaries hold any leased real or
personal property under valid and enforceable leases, with no exceptions that would
materially interfere with the value thereof or materially interfere with the use made or to
be made thereof by them; neither the Company nor its subsidiaries has knowledge of any
pending or threatened condemnation proceeding, zoning change, or other proceeding or action
that will in any manner affect the size of, use of, improvements on, construction on or
access to any of the Properties (except in any case in which such would not have a material
adverse effect on the condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business).
11
(bb) No subsidiary of the Company is currently prohibited, directly or indirectly, from
paying any dividends to the Company, from making any other distribution on such subsidiary’s
capital stock, from repaying to the Company any loans or advances to such subsidiary from
the Company or from transferring any of such subsidiary’s property or assets to the Company
or any other subsidiary of the Company, except as required by the terms of the Company’s
indebtedness described in the Registration Statement, the Prospectus and the Disclosure
Package.
(cc) The Company and its subsidiaries possess all licenses, certificates, permits and
other authorizations issued by the appropriate federal, state or foreign regulatory
authorities necessary to conduct their respective businesses (except in any case in which
failure to possess such would not have a material adverse effect on the condition (financial
or otherwise), prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the Registration Statement,
the Prospectus and the Disclosure Package (exclusive of any supplement thereto)), and
neither the Company nor any such subsidiary has received any notice of proceedings relating
to the revocation or modification of any such certificate, authorization or permit which,
singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding,
would have a material adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Registration Statement, the Prospectus and the Disclosure
Package (exclusive of any supplement thereto).
(dd) The Company maintains a system of internal accounting and other controls
sufficient to provide reasonable assurances that (i) transactions are executed in accordance
with management’s general or specific authorizations, (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity with GAAP and to
maintain accountability for assets, (iii) access to assets is permitted only in accordance
with management’s general or specific authorization, (iv) the recorded accounting for assets
is compared with existing assets at reasonable intervals and appropriate action is taken
with respect to any differences and (v) the principal executive officers (or their
equivalents) and principal financial officers (or their equivalents) of the Company have
made all certifications required by Sections 302 and 906 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002
(the “▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act”) and any related rules and regulations promulgated by the
Commission, and the statements contained in any such certification are complete and correct.
Except as described in the Registration Statement, the Prospectus and the Disclosure
Package, with respect to stock options or other equity incentive grants granted subsequent
to the adoption of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act on July 31, 2002 pursuant to the equity-based
compensation plans of the Company and its subsidiaries (the “Equity Plans”), (i) no stock
options have been granted with an exercise price based upon a price of the Common Stock on a
date occurring prior to the date of approval of such grant, (ii) each such grant was made in
accordance with the material terms of the Equity Plans, the 1934 Act, the 1934 Act
Regulations and all other applicable laws and regulatory rules or requirements, including
the rules of the New York Stock Exchange (the “NYSE”), and (iii) each such grant has been
properly accounted for
12
in accordance with GAAP in the financial statements (including the related notes) of
the Company and disclosed in the Company’s filings with the Commission.
(ee) Except as disclosed in the Registration Statement, the Prospectus and the
Disclosure Package, since the end of the Company’s most recent audited fiscal year, there
has been no change in the Company’s internal control over financial reporting that has
materially affected, or is reasonably likely to materially affect, the Company’s internal
control over financial reporting. The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-15 and 15d-15 under the 1934
Act Regulations) in accordance with the rules and regulations under the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act,
the 1933 Act and the 1934 Act.
(ff) Since July 30, 2002, the Company has not, in violation of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act,
directly or indirectly, including through a subsidiary, extended or maintained credit,
arranged for the extension of credit, or renewed an extension of credit, in the form of a
personal loan to or for any executive officer or director of the Company.
(gg) The Company acknowledges and agrees that (i) the purchase and sale of the
Securities pursuant to this Agreement is an arm’s-length commercial transaction between the
Company, on the one hand, and the several Underwriters, on the other, (ii) in connection
therewith and with the process leading to such transaction each Underwriter is acting solely
as principal and not the agent or fiduciary of the Company, (iii) no Underwriter has assumed
an advisory or fiduciary responsibility in favor of the Company with respect to the offering
contemplated hereby or the process leading thereto (irrespective of whether such Underwriter
has advised or is currently advising the Company on other matters) or any other obligations
of the Company except the obligations expressly set forth in this Agreement and (iv) the
Company has consulted its own legal and financial advisors to the extent it deemed
appropriate. The Company agrees that it will not claim that the Underwriters have rendered
advisory services of any nature or respect, or owe a fiduciary or similar duty to the
Company, in connection with the offering of the Securities or the process leading thereto.
(hh) Neither the Company nor any affiliate of the Company has taken or will take,
directly or indirectly, any action designed to or that would constitute or that might
reasonably be expected to cause or result in, under the 1934 Act or otherwise, stabilization
or manipulation of the price of any security of the Company to facilitate the sale or resale
of the Securities.
(ii) Except pursuant to this Agreement and as described in the Registration Statement,
the Prospectus and the Disclosure Package, there are no contracts, agreements or
understandings between the Company, the Operating Partnerships or any subsidiaries and any
person relating to a brokerage commission, finder’s fee or other like payment in connection
with the offering, issuance and sale of the Securities.
(jj) The Company and its subsidiaries (i) are in compliance with any and all applicable
Environmental Laws, (ii) have received and are in compliance with all permits, licenses or
other approvals required of them under applicable Environmental
13
Laws to conduct their respective businesses and all such permits, licenses and
approvals remain in full force and effect, and (iii) have not received and are not aware of
any pending or threatened notice of any actual or potential liability for the investigation
or remediation or any disposal or release of Hazardous Substances or for any other
non-compliance with Environmental Laws, except where such non-compliance with Environmental
Laws, failure to receive required permits, licenses or other approvals, or any such actual
or potential liability would not, individually or in the aggregate, result in a material
adverse change in the condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business, except as set forth in or contemplated
in the Registration Statement, the Prospectus and the Disclosure Package (exclusive of any
supplement thereto). Except as set forth in the Registration Statement, the Prospectus and
the Disclosure Package, (i) neither the Company nor any of its subsidiaries has been named
as a “potentially responsible party” under the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, and (ii) to the Company’s knowledge,
Hazardous Substances have not been released or disposed in, on, under or near the
Properties.
(kk) Each of the Company and its subsidiaries has fulfilled its obligations, if any,
under the minimum funding standards of ▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Employee Retirement
Income Security Act of 1974 (“ERISA”) and the regulations and published interpretations
thereunder with respect to each “plan” (as defined in Section 3(3) of ERISA and such
regulations and published interpretations) in which employees of the Company and its
subsidiaries are eligible to participate and each such plan is in compliance in all material
respects with the presently applicable provisions of ERISA and such regulations and
published interpretations (except in any case in which failure to do such would not have a
material adverse effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as set forth in or
contemplated in the Registration Statement, the Prospectus and the Disclosure Package
(exclusive of any supplement thereto)). The Company and its subsidiaries have not incurred
any unpaid liability to the Pension Benefit Guaranty Corporation (other than for the payment
of premiums in the ordinary course) or to any such plan under Title IV of ERISA (except in
any case in which such would not have a material adverse effect on the condition (financial
or otherwise), prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the Registration Statement,
the Prospectus and the Disclosure Package (exclusive of any supplement thereto)).
(ll) The subsidiaries listed on Schedule C attached hereto are the only significant
subsidiaries of the Company as defined by Rule 1-02 of Regulation S-X.
(mm) The Company and its subsidiaries own, possess, license or have other rights to
use, on reasonable terms, all patents, patent applications, trade and service marks, trade
and service ▇▇▇▇ registrations, trade names, copyrights, licenses, inventions, trade
secrets, technology, know-how and other intellectual property (collectively, the
14
“Intellectual Property”) used in the conduct of the Company’s business as now conducted
or as proposed in the Registration Statement, the Prospectus and the Disclosure Package to
be conducted (except in any case in which such would not have a material adverse effect on
the condition (financial or otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business). To the Company’s knowledge, (a) there is no material
infringement by third parties of any such Intellectual Property; (b) there is no pending or
threatened action, suit, proceeding or claim by others challenging the Company’s rights in
or to any such Intellectual Property, and the Company is unaware of any facts which would
form a reasonable basis for any such claim; (c) there is no pending or threatened action,
suit, proceeding or claim by others challenging the validity or scope of any such
Intellectual Property, and the Company is unaware of any facts which would form a reasonable
basis for any such claim; and (d) there is no pending or threatened action, suit, proceeding
or claim by others that the Company infringes or otherwise violates any patent, trademark,
copyright, trade secret or other proprietary rights of others, and the Company is unaware of
any other fact which would form a reasonable basis for any such claim.
(nn) The Company has been and is organized and has operated in conformity with the
requirements for qualification and taxation as a real estate investment trust (a “REIT”) for
each of its taxable years beginning with the taxable year ended December 31, 2003 through
its taxable year ended December 31, 2006, or any prior year where the Company’s failure to
so qualify could cause the Company to have a liability for taxes (whether in that year or
any subsequent year) for which the Internal Revenue Service is or will be entitled to assert
a claim, and its current organization and current and proposed method of operation will
enable it to continue to meet the requirements for qualification and taxation as a REIT for
the taxable year ending December 31, 2007 and thereafter. No transaction event has occurred
which could cause the Company not to be able to qualify as a REIT for its current taxable
year or any future taxable year. The Company currently intends to continue to qualify as a
REIT under the Internal Revenue Code of 1986, as amended.
(oo) Each of the Operating Partnerships is properly classified as a partnership, and
not as a corporation or as a publicly traded partnership taxable as a corporation, for
Federal income tax purposes throughout the period from its formation through the date
hereof.
(pp) Each of the subsidiaries that is a partnership or a limited liability company
(other than an entity for which a taxable REIT subsidiary election has been made)
(“Subsidiary Partnerships”) is properly classified either as a disregarded entity or as a
partnership, and not as a corporation or as a publicly traded partnership taxable as a
corporation, for Federal income tax purposes throughout the period from its formation
through the date hereof, or, in the case of any Subsidiary Partnerships that have
terminated, through the date of termination of such Subsidiary Partnerships.
(qq) The Company has made adequate charges, accruals and reserves in the applicable
financial statements referred to in Section 1(p) hereof in respect of all federal,
15
state, local and foreign income and franchise taxes for all periods as to which the tax
liability of the Company or any of the subsidiaries has not been finally determined.
(rr) Neither the issuance, sale and delivery of the Securities nor the application of
the proceeds thereof by the Company as described in the Registration Statement, the
Prospectus or the Disclosure Package will violate Regulation T, U or X of the Board of
Governors of the Federal Reserve System or any other regulation of such Board of Governors.
(ss) No forward-looking statement (within the meaning of Section 27A of the 1933 Act
and Section 21E of the ▇▇▇▇ ▇▇▇) contained in the Registration Statement, the Prospectus or
the Disclosure Package has been made or reaffirmed without a reasonable basis or has been
disclosed other than in good faith.
(tt) The Registration Statement is not the subject of a pending proceeding or
examination under Section 8(d) or 8(e) of the 1933 Act, and the Company is not the subject
of a pending proceeding under Section 8A of the 1933 Act in connection with the offering of
the Securities.
(uu) Nothing has come to the attention of the Company that has caused the Company to
believe that the statistical or other market-related data included in the Registration
Statement, the Prospectus or the Disclosure Package is not based on or derived from sources
that are reliable and accurate in all material respects.
Any certificate signed by any officer of the Company and delivered to the Representatives or
counsel for the Underwriters in connection with the offering of the Securities shall be deemed a
representation and warranty by the Company, as to matters covered thereby, to each Underwriter.
2. Purchase and Sale. Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company agrees to sell to each Underwriter,
severally and not jointly, and each Underwriter, severally and not jointly, agrees to purchase from
the Company, at the price per share set forth on the cover page of the final prospectus supplement,
the number the Firm Securities set forth opposite such Underwriter’s name in Schedule A attached
hereto, plus any additional number of Firm Securities which such Underwriter may become obligated
to purchase pursuant to the provisions of Section 9 hereof.
In addition, the Company hereby grants to the Underwriters the option to purchase up to
600,000 Option Securities at the same purchase price per share to be paid by the Underwriters to
the Company for the Firm Securities as set forth on the cover page of the final prospectus
supplement, for the sole purpose of covering over-allotments in the sale of Firm Securities by the
Underwriters. This option may be exercised at any time and from time to time, in whole or in part,
on or before the thirtieth (30th) day following the date of the final prospectus
supplement, by written notice by you to the Company. Such notice shall set forth the aggregate
number of Option Securities as to which the option is being exercised and the date and time, as
reasonably determined by you, when the Option Securities are to be delivered (such date and time
being herein sometimes referred to as the “Option Closing Date”); provided,
however, that the Option
16
Closing Date shall not be earlier than the Closing Date or earlier than the second full New
York business day after the date on which the option shall have been exercised nor later than the
eighth full New York business day after the date on which the option shall have been exercised
(unless such time and date are postponed in accordance with the provisions of Section 9 hereof).
The number of Option Securities to be sold to each Underwriter shall be the number which bears
the same ratio to the aggregate number of Option Securities being purchased as the number of Firm
Securities set forth opposite the name of such Underwriter in Schedule A attached hereto (or such
number increased as set forth in Section 9 hereof) bears to the total number of Firm Securities
being purchased from the Company, subject, however, to such adjustments to eliminate any fractional
shares as the Representatives in their sole discretion shall make.
3. Delivery and Payment. Delivery of and payment for the Firm Securities shall be made
at 9:00 AM, New York City time, on May 31, 2007, or at such time on such later date not more than
three (four, if the pricing occurs after 4:30 P.M. (New York City time) on any given day) New York
business days after the foregoing date as the Representatives shall designate, which date and time
may be postponed by agreement between the Representatives and the Company or as provided in Section
9 hereof (such date and time of delivery and payment for the Firm Securities being herein called
the “Closing Date”). Delivery of the Firm Securities and the Option Securities shall be made to the
Representatives for the respective accounts of the several Underwriters against payment by the
several Underwriters through the Representatives of the purchase price thereof to or upon the order
of the Company by wire transfer payable in same-day funds to an account specified by the Company.
Delivery of the Firm Securities and the Option Securities shall be made through the facilities of
The Depository Trust Company unless the Representatives shall otherwise instruct.
Certificates for the Firm Securities and the Option Securities, if any, shall be in such
denominations and registered in such names as the Representatives may request in writing at least
one full New York business day before the Closing Date or the relevant Option Closing Date, as the
case may be. The certificates for the Firm Securities and the Option Securities, if any, will be
made available for examination and packaging by the Representatives in The City of New York not
later than 10:00 A.M. (New York City time) on the New York business day prior to the Closing Date
or the relevant Option Closing Date, as the case may be.
4. Offering by Underwriters. It is understood that the several Underwriters propose to
offer the Securities for sale to the public as set forth in the Prospectus and the Disclosure
Package.
5. Agreements. The Company agrees with the several Underwriters that:
(a) The Company, subject to Section 5(b), will comply with the requirements of Rule
430B and will notify the Representatives promptly, and confirm the notice in writing, of (i)
when any post-effective amendment to the Registration Statement or a new registration
statement relating to the Securities shall become effective, or any preliminary prospectus,
the Prospectus or any amendment or supplement to any preliminary prospectus or the
Prospectus shall have been filed with the Commission, (ii) the receipt of
17
any comments from the Commission with respect to the Registration Statement, the
documents incorporated or deemed to be incorporated therein or the Prospectus, (iii) any
request by the Commission for any amendment to the Registration Statement or a new
registration statement relating to the Securities or any amendment or supplement to any
preliminary prospectus or the Prospectus or for additional information, (iv) the issuance by
the Commission of any stop order suspending the effectiveness of the Registration Statement
or such new registration statement, or any notice objecting to its use, or of any order
preventing, suspending or objecting to the use of any preliminary prospectus or the
Prospectus, or of the suspension of the qualification of the Securities for offering or sale
in any jurisdiction, or of the initiation or threatening of any proceedings for any of such
purposes or of any examination pursuant to Section 8(e) of the 1933 Act concerning the
Registration Statement or (v) the Company becoming the subject of a proceeding under Section
8A of the 1933 Act in connection with the offering of the Securities. The Company will
promptly effect the filings necessary pursuant to Rule 424(b) and will take such steps as it
deems necessary to ascertain promptly whether the form of prospectus transmitted for filing
under Rule 424(b) was received for filing by the Commission and, in the event that it was
not, it will promptly file such prospectus. The Company will use its best efforts to
prevent the issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof as soon as practicable. The Company shall pay the required Commission
filing fees relating to the Securities within the time required by Rule 456(b)(1)(i) of the
1933 Act Regulations without regard to the proviso therein and otherwise in accordance with
Rules 456(b) and 457(r) of the 1933 Act Regulations (including, if applicable, by updating
the “Calculation of Registration Fee” table in accordance with Rule 456(b)(1)(ii) either in
a post-effective amendment to the Registration Statement or on the cover page of a
prospectus filed pursuant to Rule 424(b)).
(b) The Company will give the Representatives notice of its intention to file or
prepare any amendment to the Registration Statement or a new registration statement relating
to the Securities or any amendment, supplement or revision to either any preliminary
prospectus (including the prospectus included in the Registration Statement at the time it
originally became effective) or to the Prospectus, whether pursuant to the 1933 Act, the
1934 Act or otherwise, will furnish the Representatives with copies of any such document 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 the Representatives or counsel for the
Underwriters shall reasonably object.
(c) The Company has furnished or will deliver to the Representatives and counsel for
the Underwriters, without charge, signed copies of the Registration Statement as originally
filed and any new registration statement relating to the Securities and, in each case, any
amendment thereto (including exhibits filed therewith or incorporated by reference therein
and documents incorporated or deemed to be incorporated by reference therein) and signed
copies of all consents and certificates of experts, and will also deliver to the
Representatives, without charge, a conformed copy thereof (without exhibits) for each of the
Underwriters. Copies of the Registration Statement and any new registration statement
relating to the Securities and, in each case, any amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies thereof filed
18
with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation
S-T.
(d) The Company has delivered to each Underwriter, without charge, as many copies of
each preliminary prospectus and any amendment or supplement thereto as such Underwriter may
reasonably request, and the Company hereby consents to the use of such copies for purposes
permitted by the 1933 Act. The Company will furnish or make available to each Underwriter,
without charge, during the period when a prospectus is required under the 1933 Act or 1934
Act to be delivered (or but for the exemption afforded by Rule 172 of the 1933 Act
Regulations (“Rule 172”) would be required to be delivered) to investors in connection with
sales of the Securities, such number of copies of the Prospectus and any amendment or
supplement thereto as such Underwriter may reasonably request. Each preliminary prospectus
and the Prospectus and, in each case, any amendment or supplement thereto furnished or made
available to the Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T. The Company will prepare a final term sheet (the “Final Term Sheet”)
reflecting the final terms of the Securities, in form and substance satisfactory to the
Representatives, and shall file such Final Term Sheet as an “issuer free writing prospectus”
pursuant to Rule 433 prior to the close of business two business days after the date hereof;
provided that the Company shall furnish the Representatives with copies of any such Final
Term Sheet a reasonable amount of time prior to such proposed filing and will not use or
file any such document to which the Representatives or counsel for the Underwriters shall
reasonably object.
(e) The Company will comply with the 1933 Act, the 1933 Act Regulations, the 1934 Act
and the 1934 Act Regulations so as to permit the completion of the distribution of the
Securities as contemplated in this Agreement and in the Registration Statement, the
Prospectus and the Disclosure Package. If, at any time when a prospectus is required under
the 1933 Act or the 1934 Act to be delivered (or but for the exemption afforded by Rule 172
would be required to be delivered) to investors in connection with sales of the 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 or the
Disclosure Package, as the case may be, in order that the Prospectus or the Disclosure
Package, as the case may be, 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 or the circumstances then prevailing, not
misleading, or if it shall be necessary, in the opinion of such counsel, at any such time to
amend the Registration Statement, amend or supplement the Prospectus or the Disclosure
Package or file a new registration statement relating to the Securities in order to comply
with law, including the requirements of the 1933 Act or the 1933 Act Regulations, the
Company will promptly notify the Representatives of any such event or condition and prepare
and file with the Commission (and use its best efforts to have any amendment to the
Registration Statement or any new
19
registration statement containing the Prospectus to be declared effective immediately
(if it is not an automatic shelf registration statement)), subject to Section 5(b) and 5(f)
hereof, such new registration statement or amendment or supplement, at its own expense, as
may be necessary to correct such statement or omission or to comply with law. If at any
time following issuance of an Issuer Free Writing Prospectus there occurred or occurs an
event or development as a result of which such Issuer Free Writing Prospectus conflicted or
would conflict with the information contained in the Registration Statement (or any other
registration statement relating to the Securities), the Prospectus or any preliminary
prospectus, including the documents incorporated by reference therein, the Company will
promptly notify the Representatives and will promptly amend or supplement such Issuer Free
Writing Prospectus, at its own expense, to eliminate or correct such conflict.
(f) The Company represents that neither it nor anyone acting on its behalf has made,
and agrees that, unless it obtains the prior written consent of the Representatives, neither
it nor anyone acting on its behalf will make, any offer relating to the Securities that
would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a free
writing prospectus required to be filed by the Company with the Commission or retained by
the Company under Rule 433; provided that the prior written consent of the Representatives
shall be deemed to have been given in respect of each free writing prospectus (as defined in
Rule 405), if any, that is attached hereto as Schedule B. Any such free writing prospectus
that is consented to, or is deemed to have been consented to, by the Representatives is
referred to herein as a “Permitted Free Writing Prospectus”. The Company agrees that (i) it
has treated and will treat, as the case may be, each Permitted Free Writing Prospectus as an
Issuer Free Writing Prospectus, and (ii) it has complied and will comply, as the case may
be, with the requirements of Rules 164 and 433 of the 1933 Act Regulations applicable to any
Permitted Free Writing Prospectus, including in respect of timely filing with the
Commission, legending and record keeping. The Underwriters agree that, unless they obtain
the prior written consent of the Company and, in the case of the Underwriters other than the
Representatives, the Representatives, they will not make any offer relating to the
Securities that constitutes or would constitute a free writing prospectus required to be
filed with the Commission under Rule 433; provided, however, that prior to
the preparation of the Final Term Sheet in accordance with Section 3(d), the Underwriters
are authorized to use the information with respect to the final terms of the Securities in
communications conveying information relating to the offering to investors.
(g) If immediately prior to the third anniversary (the “Renewal Deadline”) of January
25, 2006, any of the Securities remain unsold by the Underwriters, the Company will, prior
to the Renewal Deadline, file, if they have not already done so, a new shelf registration
statement relating to the Securities in a form satisfactory to the Representatives, and will
use its best efforts to cause such registration statement to be declared effective within 60
days after the Renewal Deadline. The Company will take all other action necessary or
appropriate to permit the public offering and sale of the Securities to continue as
contemplated in the expired registration statement relating thereto. References herein to
the “Registration Statement” shall include such new shelf registration statement.
20
(h) 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 to the Underwriters the benefits
contemplated by, the last paragraph of Section 11(a) of the 1933 Act.
(i) The Company will arrange, if necessary, for the qualification of the Securities for
sale under the laws of such jurisdictions as the Representatives may designate, will
maintain such qualifications in effect so long as required for the distribution of the
Securities and will pay any fee of the NASD, Inc., in connection with its review of the
offering; provided that in no event shall the Company be obligated to qualify to do business
in any jurisdiction where it is not now so qualified or to take any action that would
subject it to service of process in suits, other than those arising out of the offering or
sale of the Securities, in any jurisdiction where it is not now so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will file such
statements and reports as may be required by the laws of such jurisdiction.
(j) The Company will use any net proceeds received by it from the sale of the
Securities in the manner specified in the Registration Statement, the Prospectus and the
Disclosure Package under “Use of Proceeds”.
(k) The Company will use its best efforts to effect the listing of the Securities on
the NYSE and to maintain such listing for as long as the Securities are outstanding and to
pay all fees and supply all further documents, information and undertakings as may be
necessary or advisable to maintain such listing. In addition, on or before completion of
this offering, the Company shall make all filings required under applicable securities laws
and by the NYSE.
(l) The Company will not take, directly or indirectly, any action designed to or that
would constitute or that might reasonably be expected to cause or result in, under the 1934
Act or otherwise, stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Securities.
(m) The Company, during the period when a prospectus is required under the 1933 Act or
the 1934 Act to be delivered (or but for the exemption afforded by Rule 172 would be
required to be delivered) to investors in connection with sales of the Securities, 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.
(n) The Company will comply in all material respects with all applicable securities and
other laws, rules and regulations, including, without limitation, the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act,
and use its best efforts to cause the Company’s directors and officers, in their capacities
as such, to comply in all material respects with such laws, rules and regulations,
including, without limitation, the provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act.
(o) The Company will use its efforts to obtain a rating of “Baa3” or higher on the
Securities from ▇▇▇▇▇’▇ Investors Service, Inc. (“Moody’s”) and “BBB-” or higher
21
from Standard & Poor’s Ratings Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
(“S&P”). In addition, until 14 days after the date of this Agreement, in the event the
Company receives notice from any nationally recognized statistical rating organization, or
otherwise acquires knowledge, of any actual or potential downgrading in the rating of the
Securities, the Company shall promptly (and in no event later than five (5) days after
receiving notice or otherwise learning of such actual or potential downgrade) notify the
Underwriters of such event and shall provide the Underwriters, upon request, with any
information as to the circumstances giving rise to such actual or potential downgrade.
(p) The Company will not, without the prior written consent of Wachovia Capital
Markets, LLC, sell, offer or contract to sell, solicit offers to purchase, pledge or
otherwise dispose of, (or enter into any transaction which is designed to, or might
reasonably be expected to, result in the disposition (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise) by the Company or any
affiliate of the Company or any person in privity with the Company or any affiliate of the
Company) directly or indirectly, including the filing (or participation in the filing) of a
registration statement with the Commission in respect of, or establish or increase a put
equivalent position or liquidate or decrease a call equivalent position within the meaning
of Section 16 of the Exchange Act, any shares of Preferred Stock (other than the Securities
sold to the Underwriters) or any securities that are substantially similar to the Preferred
Stock or any securities that rank pari passu with the Preferred Stock, or, in each case,
any securities convertible into, or exercisable or exchangeable for, such shares, or
publicly announce an intention to effect any such transaction, for a period beginning on and
including the date of this Agreement through and including the date which is 60 days after
the date of this Agreement, provided, however, that the Company may issue
and sell securities that are substantially similar to the Preferred Stock or securities that
rank pari passu with the Preferred Stock (and, in the case of proviso (iii) below,
securities convertible into securities that are substantially similar to the Preferred Stock
or securities that rank pari passu with the Preferred Stock) (i) pursuant to any employee
stock option plan, employee stock ownership plan or dividend reinvestment plan of the
Company in effect at the time of the execution of this Agreement; (ii) issuable upon the
conversion of securities or the exercise of warrants outstanding at the time of the
execution of this Agreement; and (iii) as consideration for the acquisition by the Company
or one of its subsidiaries from a third party of assets or of equity interests of any other
entity which entity would, after giving effect to the acquisition of such equity interests,
be a subsidiary of the Company. It is acknowledged and agreed that the foregoing
restrictions do not apply to the Company’s redemption of its 8.60% Series B Cumulative
Redeemable Preferred Stock.
6. Conditions to the Obligations of the Underwriters. The obligations of the
Underwriters to purchase the Underwritten Securities shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein as of the date hereof
and the Closing Date (for purposes of this Section 6 “Closing Date” shall refer to the Closing Date
for the Firm Securities and any Option Closing Date, if different, for the Option Securities), to
the accuracy of the statements of the Company made in any certificates pursuant to the provisions
hereof, to the performance by the Company of its obligations hereunder and to the following
additional conditions:
22
(a) No stop order suspending the effectiveness of the Registration Statement, or notice
objecting to its use, shall have been issued by the Commission and no proceedings for that
purpose shall have been instituted or threatened. The Prospectus containing the Rule 430B
Information shall have been filed with the Commission in the manner and within the time
period required by Rule 424(b) without reliance on Rule 424(b)(8) (or a post-effective
amendment providing such information shall have been filed and become effective in
accordance with the requirements of Rule 430B). All material required to be filed by the
Company pursuant to Rule 433(d) shall have been filed with the Commission within the
applicable time periods presented for such filings under Rule 433. The Company shall have
paid the required Commission filing fees relating to the Securities within the time period
required by Rule 456(1)(i) of the 1933 Act Regulations without regard to the proviso therein
and otherwise in accordance with Rules 456(b) and 457(r) of the 1933 Act Regulations and, if
applicable, shall have updated the “Calculation of Registration Fee” table in accordance
with Rule 456(b)(1)(ii) either in a post-effective amendment to the Registration Statement
or on the cover page of a prospectus filed pursuant to Rule 424(b).
(b) The Company shall have requested and caused ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel for
the Company, to have furnished to the Representatives their opinion to the effect set forth
in Exhibit A attached hereto, dated the Closing Date and addressed to the Representatives,
in form and substance reasonably satisfactory to the Representatives. In rendering such
opinion, such counsel may rely as to matters of fact, to the extent they deem proper, on
certificates of responsible officers of the Company and public officials.
(c) The Representatives shall have received from Sidley Austin llp, counsel
for the Underwriters, such opinion or opinions, dated the Closing Date and addressed to the
Representatives, with respect to this Agreement, the Registration Statement, the Prospectus
and the Disclosure Package and other related matters as the Representatives may reasonably
require, and the Company shall have furnished to such counsel such documents as they request
for the purpose of enabling them to pass upon such matters.
(d) The Company shall have furnished to the Representatives a certificate of the
Company, signed by the Chairman of the Board or the President and the principal financial or
accounting officer of the Company, dated the Closing Date, to the effect that the signers of
such certificate have carefully examined the Registration Statement, the Prospectus, any
supplements to the Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in this Agreement are
true and correct as of the date hereof and on and as of the Closing Date with the
same effect as if made on the Closing Date and the Company has complied with all the
agreements and satisfied all the conditions on its part to be performed or satisfied
at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the Registration Statement,
or notice objecting to its use, has been issued and no proceedings for that purpose
have been instituted or, to the Company’s knowledge, threatened; and
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(iii) since the date of the most recent financial statements included or
incorporated by reference in the Registration Statement, the Prospectus or the
Disclosure Package (exclusive of any amendment or supplement thereto), there has
been no material adverse change in the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its subsidiaries,
taken as a whole, whether or not arising from transactions in the ordinary course of
business.
(e) At the time of the execution of this Agreement, the Representatives shall have
received from Ernst & Young LLP a letter, dated such date, in form and substance
satisfactory to the Representatives, 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 or incorporated by
reference or deemed to be incorporated by reference in the Registration Statement, the
Prospectus or the Disclosure Package.
(f) At Closing Date, the Representatives shall have received from Ernst & Young LLP a
letter, dated the Closing Date, to the effect that they reaffirm the statements made in the
letter furnished pursuant to Section 6(e) hereof, except that the specified date referred
therein to shall be a date not more than three New York business days prior to the Closing
Date.
(g) Subsequent to the date hereof or, if earlier, the dates as of which information is
given in the Registration Statement, the Prospectus or the Disclosure Package, there shall
not have been (i) any change or decrease specified in the letter or letters referred to in
paragraph (e) of this Section 6 or (ii) any change, or any development involving a
prospective change, in or affecting the condition (financial or otherwise), earnings,
business or properties of the Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as set forth in or
contemplated in the Registration Statement, the Prospectus and the Disclosure Package, the
effect of which, in any case referred to in clause (i) or (ii) above, is, in the sole
judgment of the Representatives, so material and adverse as to make it impractical or
inadvisable to proceed with the offering or delivery of the Securities as contemplated by
the Registration Statement, the Prospectus and the Disclosure Package.
(h) Prior to the Closing Date, the Company shall have furnished to the Representatives
such further information, certificates and documents as the Representatives may reasonably
request.
(i) Notwithstanding Section 5(o) hereof, on the Closing Date, the Securities shall have
been rated “Baa3” or higher by Moody’s and “BBB-” or higher by S&P. In addition, subsequent
to the date hereof, there shall not have been any decrease in the rating of any of the
Company’s debt securities or preferred stock by any “nationally recognized statistical
rating organization” (as defined for purposes of Rule 436(g) under the ▇▇▇▇ ▇▇▇) or any
notice given of any intended or potential decrease in any such rating or of a possible
change in any such rating that does not indicate the direction of the
24
possible change. Nor shall any such rating organization have publicly announced that
it has placed any of the Company’s debt securities or preferred stock on what is commonly
termed a “watch list” for possible downgrading.
(j) Notwithstanding Section 5(k) hereof, on the Closing Date, the Securities shall have
been listed and admitted and authorized for trading on the NYSE, and satisfactory evidence
of such actions shall have been provided to the Representatives.
(k) The NASD has confirmed that it has not raised any objection with respect to the
fairness and reasonableness of the underwriting terms and arrangements.
If any of the conditions specified in this Section 6 shall not have been fulfilled in all
material respects when and as provided in this Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not be in all material respects
reasonably satisfactory in form and substance to the Representatives and counsel for the
Underwriters, this Agreement and all obligations of the Underwriters hereunder may be cancelled at,
or at any time prior to, the Closing Date by the Representatives, and the obligations of the
Underwriters to purchase the Option Securities may be cancelled at, or at any time prior to, the
Option Closing Date by the Representatives. Notice of such cancellation shall be given to the
Company in writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall be delivered at the office of
Sidley Austin llp, counsel for the Underwriters, at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, on the Closing Date.
The obligations of the Underwriters to purchase Option Securities hereunder are subject to the
delivery to you on the applicable Option Closing Date of such documents as you may reasonably
request with respect to the good standing of the Company, the due authorization, execution,
authentication and issuance of the Option Securities and other matters related to the execution,
authentication and issuance of the Option Securities.
7. Reimbursement of Underwriters’ Expenses. If (a) the sale of the Securities provided
for herein is not consummated because any condition to the obligations of the Underwriters set
forth in Section 6 hereof is not satisfied because of any refusal, inability or failure on the part
of the Company to perform any agreement herein or comply with any provision hereof other than by
reason of a default by any of the Underwriters or (b) this Agreement is terminated due to a
suspension by the Commission or the NYSE of trading in the Company’s Common Stock, the Company will
reimburse the Underwriters severally through Wachovia Capital Markets, LLC on demand for all
reasonable documented out-of-pocket expenses (including reasonable fees and disbursements of
counsel) that shall have been incurred by them in connection with the proposed purchase and sale of
the Securities.
8. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each Underwriter, the directors,
officers, employees and agents of each Underwriter and each person who controls any
Underwriter within the meaning of either the 1933 Act or the 1934 Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or
25
any of them may become subject under the 1933 Act, the 1934 Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule 430B Information, 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, any Issuer Free Writing Prospectus, the Disclosure Package 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, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Company will not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of or is based
upon any such untrue statement or alleged untrue statement made therein in reliance upon and
in conformity with written information furnished to the Company by or on behalf of any
Underwriter through the Representatives expressly for use in the Registration Statement (or
any amendment thereto), including the Rule 430B Information, or any preliminary prospectus,
any Issuer Free Writing Prospectus, the Disclosure Package or the Prospectus (or any
amendment or supplement thereto) as described in Section 8(b) hereof. This indemnity
agreement will be in addition to any liability which the Company may otherwise have.
(b) Each Underwriter severally and not jointly agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers who signed the Registration
Statement, and each person who controls the Company within the meaning of either the 1933
Act or the 1934 Act, to the same extent as the foregoing indemnity from the Company to each
Underwriter 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 430B Information, or any preliminary prospectus, any Issuer Free Writing
Prospectus, the Disclosure Package 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 the Representatives expressly for use therein. This
indemnity agreement will be in addition to any liability which any Underwriter may otherwise
have. The Company acknowledges that the statements set forth in the third and tenth
paragraphs, and the third and fourth sentences of the seventh paragraph, under the heading
“Underwriting,” in the Prospectus constitute the only information furnished in writing by or
on behalf of the several Underwriters for inclusion in the Registration Statement, the
Prospectus and the Disclosure Package or any of the other documents referred to in the
foregoing indemnity.
(c) Promptly after receipt by an indemnified party under this Section 8 of notice of
the commencement of any action, such indemnified party will, if a claim in respect thereof
is to be made against the indemnifying party under this Section 8, notify the indemnifying
party in writing of the commencement thereof; but the failure to so
26
notify the indemnifying party (i) will not relieve the indemnifying party from
liability under paragraph (a) or (b) of this Section 8 unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) will not, in any event,
relieve the indemnifying party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraph (a) or (b) of this Section 8. The
indemnifying party shall be entitled to appoint counsel of the indemnifying party’s choice
at the indemnifying party’s expense to represent the indemnified party in any action for
which indemnification is sought (in which case the indemnifying party shall not thereafter
be responsible for the fees and expenses of any separate counsel retained by the indemnified
party or parties except as set forth below); provided, however, that such
counsel shall be satisfactory to the indemnified party. Notwithstanding the indemnifying
party’s election to appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel (including local counsel),
and the indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to represent the
indemnified party would present such counsel with a conflict of interest, (ii) the actual or
potential defendants in, or targets of, any such action include both the indemnified party
and the indemnifying party and the indemnified party shall have reasonably concluded that
there may be legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of the institution of
such action or (iv) the indemnifying party shall authorize the indemnified party to employ
separate counsel at the expense of the indemnifying party. It is understood, however, that
the indemnifying party shall, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for all such
indemnified parties, which firm shall be designated in writing by the Representatives. An
indemnifying party will not, without the prior written consent of the indemnified parties,
settle or compromise or consent to the entry of any judgment with respect to any pending or
threatened claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or (b) of this Section 8
is unavailable to or insufficient to hold harmless an indemnified party for any reason, the
Company and the Underwriters severally agree to contribute to the aggregate losses, claims,
damages and liabilities (including legal or other expenses reasonably incurred in connection
with investigating or defending same) (collectively “Losses”) to which the Company and one
or more of the Underwriters may be subject in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and by the Underwriters on the
other from the offering of the Securities; provided, however, that in no
case shall any Underwriter (except as may be provided in
27
any agreement among underwriters relating to the offering of the Securities) be
responsible for any amount in excess of the underwriting discount or commission applicable
to the Securities purchased by such Underwriter hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the Company and the
Underwriters severally shall contribute in such proportion as is appropriate to reflect not
only such relative benefits but also the relative fault of the Company on the one hand and
of the Underwriters on the other in connection with the statements or omissions which
resulted in such Losses as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds from the
offering (before deducting expenses) received by it, and benefits received by the
Underwriters shall be deemed to be equal to the total underwriting discounts and commissions
received by the Underwriters pursuant to this Agreement. Relative fault shall be determined
by reference to, among other things, whether any untrue or any alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact relates to
information provided by the Company on the one hand or the Underwriters on the other, the
intent of the parties and their relative knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The Company and the Underwriters agree
that it would not be just and equitable if contribution were determined by pro rata
allocation or any other method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this paragraph (d), no
person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the
▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person who controls an
Underwriter within the meaning of either the 1933 Act or the 1934 Act and each director,
officer, employee and agent of an Underwriter shall have the same rights to contribution as
such Underwriter, and each person who controls the Company within the meaning of either the
1933 Act or the 1934 Act, each officer of the Company who shall have signed the Registration
Statement and each director of the Company shall have the same rights to contribution as the
Company, subject in each case to the applicable terms and conditions of this paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters shall fail to purchase
and pay for any of the Securities agreed to be purchased by such Underwriter or Underwriters
hereunder and such failure to purchase shall constitute a default in the performance of its or
their obligations under this Agreement, the remaining Underwriters shall be obligated severally to
take up and pay for (in the respective proportions which the amount of Securities set forth
opposite their names in Schedule A attached hereto bears to the aggregate amount of Securities set
forth opposite the names of all the remaining Underwriters) the Securities which the defaulting
Underwriter or Underwriters agreed but failed to purchase; provided, however, that
in the event that the aggregate amount of Securities which the defaulting Underwriter or
Underwriters agreed but failed to purchase shall exceed 10% of the aggregate amount of Securities
set forth in Schedule A attached hereto, the remaining Underwriters shall have the right to
purchase all, but shall not be under any obligation to purchase any, of the Securities, and if such
nondefaulting Underwriters do not purchase all the Securities, this Agreement will terminate
without liability to any nondefaulting Underwriter or the Company. In the event of a default by any
Underwriter as set forth in this Section 9, the Closing Date or the Option Closing
28
Date, as applicable, shall be postponed for such period, not exceeding five New York business
days, as the Representatives shall determine in order that the required changes in the Registration
Statement, the Prospectus, the Disclosure Package or in any other documents or arrangements may be
effected. Nothing contained in this Agreement shall relieve any defaulting Underwriter of its
liability, if any, to the Company and any nondefaulting Underwriter for damages occasioned by its
default hereunder.
10. Termination. This Agreement shall be subject to termination (or, in the case of
an Option Closing Date that is subsequent to the Closing Date for the Firm Securities, the
obligations of the Underwriters to purchase the applicable Option Securities on such Option Closing
Date shall be subject to termination), in the absolute discretion of the Representatives, by notice
given to the Company prior to delivery of and payment for the Firm Securities (or such Option
Securities, as the case may be), if at any time prior to such time (i) trading in the Company’s
Common Stock shall have been suspended by the Commission or the NYSE or trading in securities
generally on either the NYSE or the NASDAQ Stock Market shall have been suspended or limited or
minimum prices shall have been established on either of said exchanges, (ii) a banking moratorium
shall have been declared either by Federal or New York State authorities or a material disruption
in commercial banking or securities settlement or clearance services in the United States shall
have occurred, (iii) there shall have occurred any outbreak or escalation of hostilities,
declaration by the United States of a national emergency or war, or other calamity or crisis the
effect of which on financial markets is such as to make it, in the sole judgment of the
Representatives, impractical or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by the Prospectus (exclusive of any supplement thereto) or (iv) if the
ratings assigned to debt securities or preferred stock of the Company by any “nationally recognized
statistical rating organization” (as defined for purposes of Rule 436(g) under the 1933 Act), as of
the date hereof shall have been decreased since such date or if such rating organization shall have
publicly announced or given notice of any intended or potential decrease in any such rating or of a
possible change in any such rating that does not indicate the direction of the possible change or
if any such rating organization shall have publicly announced that it has placed any of the
Company’s debt securities or preferred stock on what is commonly termed a “watch list” for possible
downgrading.
11. Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company or its officers and of
the Underwriters set forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of any Underwriter or the Company or
any of the officers, directors, employees, agents or controlling persons referred to in Section 8
hereof, and will survive delivery of and payment for the Securities. The provisions of Sections 7
and 8 hereof shall survive the termination or cancellation of this Agreement.
12. 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 Wachovia Capital Markets, LLC,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Debt Capital Markets (fax no.:
▇▇▇-▇▇▇-▇▇▇▇) (with a copy to Sidley Austin llp, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇). Notices sent to the Company, shall be mailed, delivered or
telefaxed to (▇▇▇) ▇▇▇-▇▇▇▇ and confirmed to it at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: President (with a copy to ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
LLP, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇).
13. Successors. This Agreement will inure to the benefit of and be binding upon the
parties hereto and their respective successors and the officers, directors, employees, agents and
controlling persons referred to in Section 8 hereof, and no other person will have any right or
obligation hereunder.
14. Applicable Law. This Agreement will be governed by and construed in accordance
with the laws of the State of New York applicable to contracts made and to be performed within the
State of New York.
15. Counterparts. This Agreement may be signed in one or more counterparts, each of
which shall constitute an original and all of which together shall constitute one and the same
agreement.
16. Headings. The section headings used herein are for convenience only and shall not
affect the construction hereof.
17. Definitions. The terms which follow, when used in this Agreement, shall have the
meanings indicated.
“Environmental Laws” shall mean any and all federal, state, local or municipal laws,
rules, orders, regulations, statutes, ordinances, codes, decrees or requirements of any
Governmental Authority regulating, relating to or imposing liability or standards of conduct
concerning any Hazardous Substances, public health or environmental protection, together
with any amendment or a re-authorization thereof or thereto.
“Governmental Authority” shall mean any federal, state, local or municipal governmental
body, department, agency or subdivision responsible for the due administration and/or
enforcement of any Environmental Law.
“Hazardous Substances” shall mean any pollutant, contaminant, hazardous material,
hazardous waste, infectious medical waste, hazardous or toxic substance defined or regulated
as such in or under any Environmental Law.
30
If the foregoing is in accordance with your understanding of our agreement, please sign and
return to us the enclosed duplicate hereof, whereupon this letter and your acceptance shall
represent a binding agreement among the Company and the several Underwriters.
| Very truly yours, UDR, INC. |
||||
| By: | /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | |||
| Title: | Executive Vice President and Chief Financial Officer | |||
| The foregoing Agreement is hereby confirmed and accepted as of the date first above written. | ||||
| Wachovia Capital Markets, LLC | ||||
By:
|
/s/ ▇▇▇▇▇▇ ▇▇▇ | |||
| Title: Managing Director | ||||
For itself and as Representative of the other
Underwriters, if any, named in
Schedule A attached hereto.
Underwriters, if any, named in
Schedule A attached hereto.
31
SCHEDULE A
| Number of | ||||
| Name of Underwriter | Firm Securities | |||
Wachovia Capital Markets, LLC |
3,672,000 | |||
Banc of America Securities LLC |
378,000 | |||
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. |
378,000 | |||
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Company, Incorporated |
378,000 | |||
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc. |
162,000 | |||
▇▇▇▇▇ Fargo Securities, LLC |
162,000 | |||
BB&T Capital Markets, a division of
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, Inc. |
27,000 | |||
Bear, ▇▇▇▇▇▇▇ & Co. Inc. |
27,000 | |||
▇▇▇▇▇▇▇▇▇ & Company LLC |
27,000 | |||
H&R Block Financial Advisors, Inc. |
27,000 | |||
J.J.B. ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, Inc. |
27,000 | |||
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC |
27,000 | |||
▇▇▇▇▇▇▇▇▇▇▇ & Co., Inc. |
27,000 | |||
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated |
27,000 | |||
▇▇▇▇ ▇▇▇▇ & Co., Inc. |
27,000 | |||
Wedbush ▇▇▇▇▇▇ Securities Inc. |
27,000 | |||
| 5,400,000 | ||||
SCHEDULE B
List of Issuer Free Writing Prospectuses
1. Final Term Sheet, attached hereto as Annex A to this Schedule B.
Annex A to Schedule B
| Issuer Free Writing Prospectus | ||
| Filed Pursuant to Rule 433 | ||
| Registration Statement No. 333-131278 | ||
| May 23, 2007 |
6.75% SERIES G CUMULATIVE REDEEMABLE PREFERRED STOCK
Final Term Sheet
Issuer: UDR, Inc.
Security: 6.75% Series G Cumulative Redeemable Preferred Stock
CUSIP: ▇▇▇▇▇▇▇▇▇
Size: 5,400,000 shares Over-allotment option: 600,000 shares
Type of security: SEC Registered—Registration Statement No. 333-131278; preliminary prospectus
supplement dated May 22, 2007
Public offering price: $25.00 per share; $135,000,000
Underwriting discounts and commissions: $0.7875 per share; $4,252,500 total ($4,725,000 if
over-allotment option is exercised in full)
Proceeds to the Company, before expenses: $24.2125 per share; $130,747,500 total ($145,275,000 if
over-allotment option is exercised in full)
Expected net proceeds after deducting underwriting discounts and commissions and estimated
transaction expenses payable by the Company: $130,497,500 ($145,025,000 if over-allotment option is
exercised in full).
| Sole Book-Running Manager: | Wachovia Capital Markets, LLC | |||||
| Co-Managers: | Banc of America Securities LLC, RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc., ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Company, Incorporated, ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc., ▇▇▇▇▇ Fargo Securities, LLC | |||||
Underwriting: |
Wachovia Capital Markets, LLC | 3,672,000 shares | ||||
| Banc of America Securities LLC | 378,000 shares | |||||
| RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. | 378,000 shares | |||||
| ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Company, Incorporated | 378,000 shares | |||||
| ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc. | 162,000 shares | |||||
| ▇▇▇▇▇ Fargo Securities, LLC | 162,000 shares | |||||
| BB&T Capital Markets, a division of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, Inc. | 27,000 shares | |||||
| Bear, ▇▇▇▇▇▇▇ & Co. Inc. | 27,000 shares | |||||
| ▇▇▇▇▇▇▇▇▇ & Company LLC | 27,000 shares | |||||
| H&R Block Financial Advisors, Inc. | 27,000 shares | |||||
| J.J.B. ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, Inc. | 27,000 shares | |||||
| ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC | 27,000 shares | |||||
| ▇▇▇▇▇▇▇▇▇▇▇ & Co., Inc. | 27,000 shares | |||||
| ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated | 27,000 shares | |||||
| ▇▇▇▇ ▇▇▇▇ & Co., Inc. | 27,000 shares | |||||
| Wedbush ▇▇▇▇▇▇ Securities Inc. | 27,000 shares | |||||
Dividend rate: 6.75% per annum of the liquidation preference per annum; $1.6875 per annum per
share, cumulative from May 31, 2007 (subject to the dividend rate step-up to 7.75% per annum as
described in the prospectus supplement)
Optional redemption: On or after May 31, 2012 (subject to the special optional redemption right
described in the prospectus supplement)
Settlement and delivery date: May 31, 2007
Selling concession: Not to exceed $0.50 per share
Reallowance to other dealers: Not to exceed $0.45 per share
The issuer has filed a registration statement (including a prospectus and a preliminary prospectus
supplement dated May 22, 2007) with the SEC for the offering to which this communication relates.
Before you invest, you should read the prospectus and preliminary prospectus supplement in that
registration statement and other documents the issuer has filed with the SEC for more complete
information about the issuer and this offering. You may get these documents for free by visiting
▇▇▇▇▇ on the SEC’s Web site at ▇▇▇.▇▇▇.▇▇▇. Alternatively, the issuer, any underwriter or
any dealer participating in the offering will arrange to send you the prospectus if you request it
from Wachovia Capital Markets, LLC by calling toll-free ▇▇▇-▇▇▇-▇▇▇▇.
SCHEDULE C
List of Significant Subsidiaries
United Dominion Realty L.P.
Heritage Communities L.P.
EXHIBIT A
FORM OF OPINION OF ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
(a) Each of the Company and United Dominion Realty, L.P. and Heritage Communities L.P. (the
“Operating Entities”) has been duly incorporated or formed, as applicable, and is validly existing
as a corporation or limited partnership, as the case may be, in good standing under the laws of the
jurisdiction in which it is incorporated or formed, as applicable, with full corporate or
partnership, as applicable, power and authority to own or lease, as the case may be, and to operate
its properties and conduct its business as described in the Prospectus as amended or supplemented.
(b) The Company is duly qualified to transact business as a foreign corporation in the States
of Arizona, Colorado, Delaware, Florida, Georgia, North Carolina, Ohio, Oregon, South Carolina,
Tennessee and Virginia. United Dominion Realty, L.P. is duly qualified and authorized to transact
business as a foreign limited partnership in the States of Arizona, California, Florida, Georgia,
Maryland, Ohio, Oregon, Tennessee, Virginia and Washington. Heritage Communities L.P. is duly
qualified and authorized to transact business as a foreign limited partnership in the States of
Arizona, California, Texas and Washington.
(c) The Company owns a general partnership interest in each Operating Entity. As of March 31,
2007 the Company had approximately a 94% limited partnership interest in United Dominion Realty,
L.P. and approximately a 94% limited partnership interest in Heritage Communities L.P.
(d) The Company’s authorized equity capitalization is as set forth in the Prospectus; the
capital stock of the Company conforms in all material respects to the description thereof contained
in the Prospectus; all of the outstanding shares of the Company’s Common Stock and Preferred Stock
have been duly authorized and validly issued and are fully paid and non-assessable, and none of
such shares was issued in violation of any preemptive rights; the Securities have been duly
authorized for issuance and sale to the Underwriters pursuant to the Underwriting Agreement and,
upon delivery to the Underwriters against payment therefor in accordance with the terms of the
Underwriting Agreement, will be validly issued, fully paid and nonassessable; the Securities are
duly listed, and admitted and authorized for trading, subject to official notice of issuance, on
the New York Stock Exchange; the certificates for the Securities are in valid and sufficient form;
and the issuance of the Securities is not subject to preemptive rights.
(e) The preferences and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption of the Securities as set forth in
the Articles Supplementary are permitted by Maryland law.
(f) The Articles Supplementary have been filed for record with the State Department of
Assessments and Taxation of the State of Maryland pursuant to Maryland law.
(g) None of the issue and sale of the Securities, the compliance by the Company with all of
the provisions of the Underwriting Agreement, nor the consummation of any other of the
transactions herein or therein contemplated will (i) result in a violation of the Articles of
Restatement, as amended, or Amended and Restated Bylaws of the Company, (ii) to our knowledge,
constitute a material breach of the terms of any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Company is a party or by which it is bound or to
which its property or assets of the Company is subject and which has been filed as an exhibit to
any of the Company’s filings made pursuant to the Exchange Act and incorporated by reference into
the Registration Statement and the Prospectus, or (iii) to our knowledge, violate any statute, law,
order, rule or regulation of any court, regulatory body, administrative agency, governmental body,
arbitrator or other authority of the State of Maryland or the United States of America having
jurisdiction over the Company or any of its properties.
(h) The Registration Statement has become effective under the Act; any required filing of the
Prospectus, and any supplements thereto, 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, or notice objecting to its use, has been issued and no
proceedings for that purpose have been instituted or threatened by the Commission.
(i) The Registration Statement and the Prospectus (other than the financial statements, the
related notes and schedules thereto and other financial and statistical information included or
incorporated by reference therein), excluding the documents incorporated by reference therein, as
of their respective effective or issue dates, as the case may be, complied as to form in all
material respects with the applicable requirements of the 1933 Act and the 1933 Act Regulations of
the Commission thereunder.
(j) No authorization, approval or consent of any governmental authority or agency is required
in connection with the transactions contemplated in the Underwriting Agreement, except such as have
been obtained under the Act and such as may be required under state securities or Blue Sky laws of
any jurisdiction in connection with the purchase and distribution of the Securities by the
Underwriters in the manner contemplated in the Underwriting Agreement and in the Prospectus and
such other approvals as have been obtained.
(k) Each document filed pursuant to the Exchange Act (other than the financial statements,
supporting schedules, footnotes and other statistical and financial information contained therein,
as to which we express no opinion) and incorporated or deemed to be incorporated by reference in
the Registration Statement and Prospectus complied when so filed as to form in all material
respects with the Exchange Act and the rules thereunder.
(l) The statements set forth in the Prospectus under the captions “Description Preferred
Stock,” “Description of the Series G Preferred Stock” and “Material U.S. Federal Income Tax
Considerations”, insofar as they constitute a summary of documents referred to therein or matters
of law are correct in all material respects.
(m) The Underwriting Agreement has been duly authorized, executed and delivered by the
Company.
(n) To our knowledge, there is no pending or threatened action, suit or proceeding by or
before any court or governmental agency, authority or body or any arbitrator involving the Company
or any of the Operating Entities or its or their property which, if determined adversely to the
Company or any of the Operating Entities, would individually or in the aggregate have a material
adverse effect on the current or future consolidated financial position, shareholders’ equity or
results of operations of the Company and its subsidiaries, taken as a whole.
(o) The Company has been organized and has operated in conformity with the requirements for
qualification and taxation as a REIT under the Code for each of its taxable years beginning with
the taxable year ended December 31, 2003 through its taxable year ended December 31, 2006, and if
it continues to be organized and operated after December 31, 2006 in the same manner as it has
prior to that date, it will continue to qualify as a REIT.
(p) Neither the Company nor either of the Operating Entities is an “investment company” as
defined in the Investment Company Act of 1940, as amended.
In addition, we have participated in conferences with your representatives and with
representatives of the Company and its accountants concerning the Registration Statement, the
Prospectus and the General Disclosure Package and have considered the matters required to be stated
therein and the statements contained therein, although we have not independently verified the
accuracy, completeness or fairness of such statements. Based upon and subject to the foregoing, no
facts have come to our attention that lead us to believe that (A) the Registration Statement, at
the later of the time of the filing of the Annual Report on Form 10-K or as of the “new effective
date” with respect to the Underwriters pursuant to, and within the meaning of, Rule 430B(f)(2)
under the 1933 Act, contained an untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements therein not
misleading, or (B) (1) the General Disclosure Package, as of the Applicable Time specified in the
Underwriting Agreement and (2) the Prospectus, as of its date and the date hereof, in each case,
contained an untrue statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading (it being understood that we have not been requested to and do
not make any comment in this paragraph with respect to the financial statements, supporting
schedules, footnotes, and other financial and statistical information contained in the Registration
Statement, the Prospectus or the General Disclosure Package).