EXHIBIT 1.1
KEYSTONE PROPERTY TRUST
(a Maryland real estate investment trust)
7,500,000 Common Shares of Beneficial Interest
(Par Value $.001 Per Share)
PURCHASE AGREEMENT
April 24, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Credit Suisse First Boston Corporation
First Union Securities, Inc.
c/o Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
Keystone Property Trust, a Maryland statutory real estate investment trust
(including its predecessor the "Company"), confirms its agreement with ▇▇▇▇▇▇▇
▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇
▇▇▇▇▇"), Credit Suisse First Boston Corporation and First Union Securities, Inc.
(collectively, the "Underwriters," which term shall also include any underwriter
substituted as hereinafter provided in Section 10 hereof), for whom ▇▇▇▇▇▇▇
▇▇▇▇▇, Credit Suisse First Boston Corporation and First Union Securities, Inc.
are acting as representative(s) (in such capacity, the "Representative(s)"),
with respect to the issue and sale by the Company and the purchase by the
Underwriters, acting severally and not jointly, of the respective number of
common shares of beneficial interest, par value $.001 per share, of the Company
(the "Common Shares") set forth in SCHEDULE A hereto, and with respect to the
grant by the Company to the Underwriters, acting severally and not jointly, of
the option described in Section 2(b) hereof to purchase all or any part of
1,125,000 additional Common Shares to cover over-allotments, if any. The
aforesaid 7,500,000 Common Shares (the "Initial Securities") to be purchased by
the Underwriters and all or any part of the 1,125,000 Common Shares subject to
the option described in Section 2(b) hereof (the "Option Securities") are
hereinafter called, collectively, the "Securities."
The Company understands that the Underwriters propose to make a public
offering of the Securities as soon as the Representative(s) deem(s) advisable
after this Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-58971) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this Agreement, the Company will either
(i) prepare and file a prospectus in accordance with the provisions of Rule 430A
("Rule 430A") of the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations"), if applicable, and paragraph (b) of Rule 424
("Rule 424(b)") of the 1933 Act Regulations or (ii) if the Company has elected
to rely upon Rule 434 ("Rule 434") of the 1933 Act Regulations, prepare and file
a term sheet (a "Term Sheet") in accordance with the provisions of Rule 434 and
Rule 424(b). The information included in any such prospectus or in any such Term
Sheet, as the case may be, that was omitted from such registration statement at
the time it became effective but that is deemed to be part of such registration
statement at the time it became effective, if applicable, (a) pursuant to
paragraph (b) of Rule 430A is referred to as "Rule 430A Information" or (b)
pursuant to paragraph (d) of Rule 434 is referred to as "Rule 434 Information."
Each prospectus used before such registration statement became effective, and
any prospectus that omitted, as applicable, the Rule 430A Information or the
Rule 434 Information, that was used after such effectiveness and prior to the
execution and delivery of this Agreement, is herein called a "preliminary
prospectus." Such registration statement, including the exhibits thereto,
schedules thereto, if any, and the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the 1933 Act, at the time it became
effective and including the Rule 430A Information and the Rule 434 Information,
as applicable, is herein called the "Registration Statement." Any registration
statement filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein
referred to as the "Rule 462(b) Registration Statement," and after such filing
the term "Registration Statement" shall include the Rule 462(b) Registration
Statement. The final prospectus, including the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the 1933 Act, in the
form first furnished to the Underwriters for use in connection with the offering
of the Securities is herein called the "Prospectus." If Rule 434 is relied on,
the term "Prospectus" shall refer to the preliminary prospectus together with
the Term Sheet and all references in this Agreement to the date of the
Prospectus shall mean the date of the Term Sheet. For purposes of this
Agreement, all references to the Registration Statement, any preliminary
prospectus, the Prospectus or any Term Sheet 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 and schedules and
other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of
1934, as amended (the "1934 Act"), which is incorporated by reference in the
Registration Statement, such preliminary prospectus or the Prospectus, as the
case may be.
The term "Subsidiary" means a corporation or a partnership a majority of
the outstanding voting stock, partnership or membership interests, as the case
may be, of which is owned or controlled, directly or indirectly, by the Company,
Keystone Operating Partnership, L.P., a Delaware limited partnership (the
"Operating Partnership"), or by one or more other Subsidiaries of the Company or
the Operating Partnership.
SECTION 1. Representations and Warranties.
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY AND THE OPERATING
PARTNERSHIP. Each of the Company and the Operating Partnership represents and
warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with each Underwriter, as
follows:
(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. The Company meets the
requirements for use of Form S-3 under the 1933 Act. Each of the
Registration Statement, including any Rule 462(b) Registration Statement,
has become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto
(including the filing of the Company's most recent Annual Report on Form
10-K with the Commission) became effective, at the date of this Agreement
and at the Closing Time (and, if any Option Securities are purchased, at
the Date of Delivery), the Registration Statement, the Rule 462(b)
Registration Statement and any amendments and supplements thereto complied
and will comply in all material respects with the requirements of the 1933
Act and the 1933 Act Regulations and did not and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading. Neither the Prospectus nor any amendments or supplements
thereto at the time the Prospectus or any such amendment or supplement was
issued and at the Closing Time (and, if any Option Securities are
purchased, at the Date of Delivery), included or will include an untrue
statement of a material fact or omitted 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. If Rule 434
is used, the Company will comply with the requirements of Rule 434. The
representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any Underwriter through ▇▇▇▇▇▇▇
▇▇▇▇▇ expressly for use in the Registration Statement or Prospectus.
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 under the 1933 Act, complied when
so filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriters
for use in connection with 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.
If a Rule 462(b) Registration Statement is required in connection
with the offering and sale of the Securities, the Company has complied or
will comply with the requirements of Rule 111 under the 1933 Act
Regulations relating to the payment of filing fees thereof.
(ii) INCORPORATED DOCUMENTS. The documents incorporated or deemed to
be incorporated by reference in the Registration Statement and the
Prospectus, when they became effective or 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 1933 Act and the 1933 Act
Regulations or 1934 Act and the rules and regulations of the Commission
thereunder (the "1934 Act Regulations"), as applicable, and, when read
together with the other information in the Prospectus, at the time the
Registration Statement became effective, at the time the Prospectus was
issued and at the Closing Time (and, if any Option Securities are
purchased, at the Date of Delivery), did not and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.
(iii) INDEPENDENT ACCOUNTANTS. The accountants who certified the
financial statements and supporting schedules included in the Registration
Statement are independent public accountants as required by the 1933 Act
and the 1933 Act Regulations.
(iv) FINANCIAL STATEMENTS. The financial statements included in the
Registration Statement and the Prospectus, together with the related
schedules and notes, present fairly the financial position of the Company
and its consolidated subsidiaries at the dates indicated and the statement
of operations, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout
the periods involved. The supporting schedules, if any, included in the
Registration Statement and Prospectus present fairly in accordance with
GAAP the information required to be stated therein. The selected financial
data and the summary financial information included in the Registration
Statement and Prospectus present fairly the information shown therein and
have been compiled on a basis consistent with that of the audited
financial statements included in the Registration Statement and
Prospectus. In addition, any pro forma financial information included in
the Registration Statement and the Prospectus present fairly the
information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements and
have been properly compiled on the bases described therein, and the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein. All historical
financial statements and information and all pro forma financial
statements and information relating to the Company or any entity acquired
or to be acquired by the Company required by the 1933 Act, the 1933 Act
Regulations, the 1934 Act and the 1934 Act Regulations are included, or
incorporated by reference, in the Registration Statement and Prospectus.
(v) NO MATERIAL ADVERSE CHANGE IN BUSINESS. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Company, the
Operating Partnership and the Subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business (a "Material
Adverse Effect"), (B) no casualty loss or condemnation or other adverse
event with respect to any of the interests held directly or indirectly in
any of the real properties or real property interests, including without
limitation, any interest or participation, direct or indirect, in any
mortgage obligation owned, directly or indirectly, by the Company, the
Operating Partnership or any Subsidiary (the "Properties") has occurred
which would be material with respect to the Company, the Operating
Partnership and the Subsidiaries considered as one enterprise, (C) there
have been no transactions entered into by the Company, the Operating
Partnership or any Subsidiary, other than those in the ordinary course of
business, which are material with respect to the Company, the Operating
Partnership and the Subsidiaries considered as one enterprise, (D) except
for the Crescent purchase as described in the Prospectus, regular
quarterly dividends on the Common Shares in amounts per share that are
consistent with past practice and regular quarterly distributions on the
Company's Series A, Series B and Series C Convertible Preferred Stock
(collectively, the "Preferred Stock"), and regular quarterly distributions
on the common and preferred units of the Operating Partnership (the
"Units"), there has been no dividend or distribution of any kind declared,
paid or made by the Company on any class of its capital stock or any
distribution by the Operating Partnership with respect to its Units, and
(E) there has been no increase in long-term debt or decrease in the
capital of the Company, the Operating Partnership or any Subsidiary.
(vi) GOOD STANDING OF THE COMPANY. The Company has been duly formed
and is validly existing as a statutory real estate investment trust in
good standing under Title 8 of the Corporations and Associations Article
of the Annotated Code of Maryland (the "Maryland REIT law") and has trust
power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and to enter into and
perform its obligations under this Agreement; and the Company is duly
qualified and registered as a foreign real estate investment trust and is
in good standing in each jurisdiction in which such qualification or
registration is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to
qualify or to be in good standing would not result in a Material Adverse
Effect.
(vii) GOOD STANDING OF THE OPERATING PARTNERSHIP. The Operating
Partnership is duly organized and validly existing as a limited
partnership in good standing under the laws of the State of Delaware, with
partnership power and authority to own, lease and operate its properties,
to conduct the business in which it is engaged and proposes to engage as
described in the Prospectus and to enter into and perform its obligations
under this Agreement. The Operating Partnership is duly qualified or
registered as a foreign partnership and is in good standing in each
jurisdiction in which such qualification or registration is required,
whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure to so qualify or register would not
result in a Material Adverse Effect. The Company is the sole general
partner of the Operating Partnership. The Amended and Restated Agreement
of Limited Partnership of the Operating Partnership, dated as of October
13, 1999, as amended through March 6, 2001 (the "Operating Partnership
Agreement"), is in full force and effect.
(viii) GOOD STANDING OF SUBSIDIARIES. The Operating Partnership is
the only Subsidiary that is a "significant subsidiary" of the Company (as
such term is defined in Rule 1-02 of Regulation S-X). The only
Subsidiaries of the Company are (a) the Subsidiaries listed on Exhibit 21
to the Registration Statement and (b) certain other Subsidiaries which,
considered in the aggregate as a single Subsidiary, do not constitute a
"significant subsidiary" as defined in Rule 1-02 of Regulation S-X.
(ix) CAPITALIZATION. As of the date of this Agreement, the
authorized capital stock of the Company consists of 65,000,000 Common
Shares and 5,800,000 preferred shares, par value $.001 per share, of which
9,715,011 Common Shares and 800,000 shares of Series A Convertible
Preferred Stock, 803,871 shares of Series B Convertible Preferred Stock
and 800,000 shares of Series C Convertible Preferred Stock are issued and
outstanding on the date hereof. All issued and outstanding shares of
beneficial interest of the Company have been duly authorized and validly
issued and are fully paid and non-assessable and have been offered and
sold or exchanged by the Company in compliance with all applicable laws
(including, without limitation, federal and state securities laws); none
of the outstanding shares of beneficial interest of the Company were
issued in violation of the preemptive or other similar rights of any
securityholder of the Company.
(x) AUTHORIZATION OF UNITS. All issued and outstanding Units have
been duly authorized and are validly issued, fully paid and non-assessable
and have been offered and sold or exchanged by the Operating Partnership
in compliance with all applicable laws (including, without limitation,
federal and state securities laws). Except for (i) any outstanding
convertible preferred units, (ii) a third party interest in Keystone
Cranberry West, LLC that can be exchanged for Units (the "Cranberry
Interest") and (iii) units that may be issued pursuant to the option
agreement between the Operating Partnership and ▇▇▇▇▇▇▇▇ Investments,
Inc., dated as of December 14, 1998 (the "▇▇▇▇▇▇▇▇ Agreement"), there are
no Units reserved for any purpose and there are no outstanding securities
convertible into or exchangeable for any Units and no outstanding options,
rights (preemptive or otherwise) or warrants to purchase or to subscribe
for Units.
(xi) AUTHORIZATION AND DESCRIPTION OF SECURITIES. The Securities to
be purchased by the Underwriters from the Company have been duly
authorized for issuance and sale to the Underwriters pursuant to this
Agreement and, when issued and delivered by the Company pursuant to this
Agreement against payment of the consideration set forth herein, will be
validly issued, fully paid and non-assessable. The Common Shares conform
to all statements relating thereto contained in the Prospectus and such
description conforms to the rights set forth in the instruments defining
the same; no holder of the Securities will be subject to personal
liability by reason of being such a holder; and except for the preemptive
purchase right of certain holders of Common Shares under the Subscription
Agreement, dated July 7, 1998 (the "Common Shares Purchase Rights") and
the preemptive purchase right of the holders of the Company's Series A
Preferred Stock (the "Series A Purchase Rights"), the issuance of the
Securities is not subject to the preemptive or other similar rights of any
securityholder of the Company.
(xii) AUTHORIZATION OF AGREEMENT. This Agreement has been duly
authorized, executed and delivered by the Company and the Operating
Partnership.
(xiii) ABSENCE OF DEFAULTS AND CONFLICTS. None of the Company, the
Operating Partnership or any Subsidiary is in violation of its declaration
of trust, partnership agreement, charter, by-laws or other governing
instrument ("Governing Instruments") or in default in the performance or
observance of any obligation, agreement, covenant or condition contained
in any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or other agreement or instrument to which the
Company, the Operating Partnership or any Subsidiary is a party or by
which it or any of them may be bound, or to which any of the property or
assets of the Company, the Operating Partnership or any Subsidiary is
subject (collectively, "Agreements and Instruments") except for such
violations or defaults that would not result in a Material Adverse Effect;
and the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated herein and in the Prospectus
(including the issuance and sale of the Securities and the use of the
proceeds from the sale of the Securities as described in the Prospectus
under the caption "Use of Proceeds") and compliance by the Company and the
Operating Partnership with their respective obligations hereunder have
been duly authorized by all necessary requisite action and do not and will
not, whether with or without the giving of notice or passage of time or
both, conflict with or constitute a breach of, or default or Repayment
Event (as defined below) under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the
Company, the Operating Partnership or any Subsidiary pursuant to, the
Agreements and Instruments (except for such conflicts, breaches, defaults
or Repayment Events or liens, charges or encumbrances that would not
result in a Material Adverse Effect), nor will such action result in any
violation of the provisions of the Governing Instruments of the Company,
the Operating Partnership or any Subsidiary or any applicable law,
statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company, the Operating Partnership or any
Subsidiary or any of their assets, properties or operations, except for
such violations that would not have a Material Adverse Effect. As used
herein, a "Repayment Event" means any event or condition which gives the
holder of any
note, debenture or other evidence of indebtedness (or any person acting on
such holder's behalf) the right to require the repurchase, redemption or
repayment of all or a material portion of such indebtedness by the
Company, the Operating Partnership or any Subsidiary.
(xiv) ABSENCE OF LABOR DISPUTE. No labor dispute with the employees
of the Company, the Operating Partnership or any Subsidiary exists or, to
the knowledge of the Company or the Operating Partnership, is imminent,
and the Company and the Operating Partnership are not aware of any
existing or imminent labor disturbance by the employees of any of its or
any Subsidiary's principal suppliers, manufacturers, customers or
contractors, which, in either case, may reasonably be expected to result
in a Material Adverse Effect.
(xv) ABSENCE OF PROCEEDINGS. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Company or the Operating Partnership, threatened, against or affecting
the Company, the Operating Partnership or any Subsidiary, which is
required to be disclosed in the Registration Statement (other than as
disclosed therein), or which might reasonably be expected to result in a
Material Adverse Effect or the consummation of the transactions
contemplated in this Agreement or the performance by the Company or the
Operating Partnership of their respective obligations hereunder. The
aggregate of all pending legal or governmental proceedings to which the
Company, the Operating Partnership or any Subsidiary is a party or of
which any of their respective properties or assets is the subject which
are not described in the Registration Statement, including ordinary
routine litigation could not reasonably be expected to result in a
Material Adverse Effect.
(xvi) ACCURACY OF EXHIBITS. Except for the 1994 Non-Employee Stock
Option Plan (the "1994 Plan") which was not filed as an exhibit to the
Company's Annual Report on Form 10-K for the year ended December 31, 2000
(the "10-K"), there are no contracts or documents which are required to be
described in the Registration Statement, the Prospectus or the documents
incorporated by reference therein or to be filed as exhibits thereto which
have not been so described and filed as required.
(xvii) REIT QUALIFICATION. Commencing with its taxable year ended
December 31, 1993, the Company has been, and upon the sale of the
Securities, the Company will continue to be organized and operated in
conformity with the requirements for qualification and taxation as a real
estate investment trust (a "REIT") under the Internal Revenue Code of
1986, as amended (the "Code"), and the Company's proposed method of
operation as described in the Prospectus will enable it to continue to
meet the requirements for qualification and taxation as a REIT under the
Code, and no actions have been taken (or not taken which are required to
be taken) which would cause such qualification to be lost.
(xviii) INVESTMENT COMPANY ACT. Each of the Company, the Operating
Partnership and any Subsidiary is not, and upon the issuance and sale of
the Securities as herein contemplated and the application of the net
proceeds therefrom as described in the
Prospectus will not be, an "investment company" or an entity "controlled"
by an "investment company" as such terms are defined in the Investment
Company Act of 1940, as amended (the "1940 Act").
(xix) POSSESSION OF INTELLECTUAL PROPERTY. The Company, the
Operating Partnership and any Subsidiary own or possess, or can acquire on
reasonable terms, adequate patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other intellectual
property (collectively, "Intellectual Property") necessary to carry on the
business now operated by them, and neither the Company, the Operating
Partnership or any Subsidiary has received any written notice or is
otherwise aware of any infringement of or conflict with asserted rights of
others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company, the Operating
Partnership or any Subsidiary therein, and which infringement or conflict
(if the subject of any unfavorable decision, ruling or finding) or
invalidity or inadequacy, singly or in the aggregate, would result in a
Material Adverse Effect.
(xx) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company or the
Operating Partnership of their respective obligations hereunder, in
connection with the offering, issuance or sale of the Securities hereunder
or the consummation of the transactions contemplated by this Agreement,
except as such as has already been obtained or as required under such
securities laws or under the rules of the National Association of
Securities Dealers, Inc.
(xxi) POSSESSION OF LICENSES AND PERMITS. Each of the Company, the
Operating Partnership and the Subsidiaries possess such permits, licenses,
approvals, consents and other authorizations (collectively, "Governmental
Licenses") issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to conduct the business now
operated by them except where failure to possess any such Governmental
Licenses would not result in a Material Adverse Event; the Company, the
Operating Partnership and their Subsidiaries are in compliance with the
terms and conditions of all such Governmental Licenses, except where the
failure so to comply would not, singly or in the aggregate, result in a
Material Adverse Effect; all of the Governmental Licenses are valid and in
full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force
and effect would not result in a Material Adverse Effect; and none of the
Company, the Operating Partnership or any of the Subsidiaries has received
any notice of proceedings relating to the revocation or modification of
any such Governmental Licenses which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in a
Material Adverse Effect.
(xxii) TITLE TO PROPERTY. (A) The Company, the Operating
Partnership, the Subsidiaries or any joint venture partnership in which
the Company, the Operating
Partnership or any Subsidiary owns an interest, as the case may be, have
good and marketable fee simple title or leasehold title, as the case may
be, to all real property owned or leased, as applicable, by the Company,
the Operating Partnership, the Subsidiaries or the applicable joint
venture partnership, respectively, and good title to all other properties
owned by them, and any improvements thereon and all other assets that are
required for the operation of such properties in the manner in which they
currently are operated, free and clear of all liens, encumbrances, claims,
security interests and defects, except such as are Permitted Encumbrances
(as defined below); (B) all liens, charges, encumbrances, claims or
restrictions on or affecting any of the Properties and the assets of any
of the Company, the Operating Partnership, the Subsidiaries or any joint
venture partnership in which the Company, the Operating Partnership or any
Subsidiary owns an interest that are required to be disclosed in the
Prospectus are disclosed therein; (C) each of the Properties complies with
all applicable codes, laws and regulations (including, without limitation,
building and zoning codes, laws and regulations and laws relating to
access to the Properties), except if and to the extent disclosed in the
Prospectus and except for such failures to comply that would not in the
aggregate have a Material Adverse Effect; (D) there are in effect for the
assets of each of the Company, the Operating Partnership, the Subsidiaries
or any joint venture partnership in which the Company, the Operating
Partnership or any Subsidiary owns an interest, insurance policies
covering the risks and in amounts that are commercially reasonable for the
types of assets owned by them and that are consistent with the types and
amounts of insurance typically maintained by prudent owners of properties
similar to such assets in the markets in which such assets are located,
and none of the Company, the Operating Partnership, the Subsidiaries or
any joint venture partnership in which the Company, the Operating
Partnership or any Subsidiary owns an interest has received from any
insurance company notice of any material defects or deficiencies affecting
the insurability of any such assets or any notices of cancellation or
intent to cancel any such policies; and (E) neither the Company nor the
Operating Partnership has any knowledge of any pending or threatened,
litigation, moratorium, condemnation proceedings, zoning change, or other
similar proceeding or action that could in any manner affect the size of,
use of, improvements on, construction on, access to or availability of
utilities or other necessary services to the Properties, except such
proceedings or actions that would not have a Material Adverse Effect. All
of the leases and subleases material to the business of the Company, the
Operating Partnership and the Subsidiaries considered as one enterprise,
and under which the Company, the Operating Partnership or any Subsidiary
holds Properties described in the Prospectus, are in full force and
effect, and none of the Company, the Operating Partnership or any
Subsidiary has received any notice of any material claim of any sort that
has been asserted by anyone adverse to the rights of the Company, the
Operating Partnership or any Subsidiary under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the
Company, the Operating Partnership or any Subsidiary of the continued
possession of the leased or subleased premises under any such lease or
sublease. "Permitted Encumbrance" shall mean (a) liens on Properties
securing any of the Company, the Operating Partnership, any Subsidiary or
joint venture partnership obligations, (b) other liens which are expressly
described in, or which are incorporated by reference into, the Prospectus
and (c) customary easements and encumbrances and other exceptions to title
which do not materially impair the operation,
development or use of the Properties for the purposes intended therefor as
contemplated in the Prospectus.
(xxiii) ENVIRONMENTAL LAWS. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, result in a
Material Adverse Effect, to the knowledge of the Company, the Operating
Partnership and any Subsidiary, as the case may be (A) none of the
Company, the Operating Partnership or any of the Subsidiaries is in
violation of any federal, state, local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law or any judicial
or administrative interpretation thereof, including any judicial or
administrative order, consent, decree or judgment, relating to pollution
or protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, "Hazardous Materials") or
to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (B) the Company, the Operating Partnership and the
Subsidiaries have all permits, authorizations and approvals required under
any applicable Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or threatened administrative,
regulatory or judicial actions, suits, demands, demand letters, claims,
liens, notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company, the Operating
Partnership or any of the Subsidiaries and (D) there are no events or
circumstances that might reasonably be expected to form the basis of an
order for clean-up or remediation, or an action, suit or proceeding by any
private party or governmental body or agency, against or affecting the
Company, the Operating Partnership or any of the Subsidiaries relating to
Hazardous Materials or any Environmental Laws.
(xxiv) TAX RETURNS. The Company, the Operating Partnership and any
Subsidiary, as the case may be, have filed all federal, state, local and
foreign income tax returns which have been required to be filed (except in
any case in which an extension has been granted or the failure to so file
would not result in a Material Adverse Effect) 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, in all cases, for any such tax, assessment, fine or penalty that
is being contested in good faith.
(xxv) ENVIRONMENTAL CONSULTANTS. None of the environmental
consultants which prepared environmental and asbestos inspection reports
with respect to the Properties was employed for such purpose on a
contingent basis or has any substantial interest in the Company, the
Operating Partnership or any Subsidiary and none of them nor any of their
directors, officers or employees is connected with the Company, the
Operating Partnership or any Subsidiary as a promoter, selling agent,
trustee, director, officer or employee.
(xxvi) TITLE INSURANCE. The Company, the Operating Partnership and
any Subsidiary, as the case may be, have obtained, title insurance on the
fee interests and leasehold interests in each of the Properties in an
amount at least equal to the greater of (A) the mortgage indebtedness on
each such Property or (B) the purchase price paid for
each such Property (in the case of any Property having been acquired by
the Operating Partnership via an exchange of Units for ownership interests
in the entity holding such property, the "purchase price" of such Property
being deemed to be the sum of (i) the per-share price of the Common Shares
of the Company on the date such interests were exchanged for Units
multiplied by the number of Units exchanged for such interests in the
entity holding such Property and (ii) the amount of any assumed
indebtedness secured by such Property).
(xxvii) ABSENCE OF REGULATION M VIOLATION. None of the Company, the
Operating Partnership, the Subsidiaries, nor any of their respective
trustees, directors, officers, members or controlling persons, has taken
or will take, directly or indirectly, any action resulting in a violation
of Regulation M under the 1934 Act, or designed to cause or result in, or
that has constituted or that reasonably might be expected to constitute,
the stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
(xxviii) REGISTRATION RIGHTS. There are no persons with registration
rights or other similar rights to have any securities registered pursuant
to the Registration Statement.
(b) OFFICER'S CERTIFICATES. Any certificate signed by any officer of the
Company, or any authorized representative of the Operating Partnership or any of
their subsidiaries delivered to the Representative(s) or to counsel for the
Underwriters shall be deemed a representation and warranty by such person or
entity, as the case may be, to each Underwriter as to the matters covered
thereby.
SECTION 2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING.
(a) INITIAL SECURITIES. On the basis of the representations and warranties
herein contained and subject to the terms and conditions 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 in SCHEDULE B, the number of Initial Securities
set forth in SCHEDULE A opposite the name of such Underwriter, plus any
additional number of Initial Securities which such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof.
(b) OPTION SECURITIES. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the Underwriters, severally
and not jointly, to purchase up to an additional 1,125,000 Common Shares in the
aggregate at the price per share set forth in SCHEDULE B, less an amount per
share equal to any dividends or distributions declared by the Company and
payable on the Initial Securities but not payable on the Option Securities. The
option hereby granted will expire 30 days after the date hereof and may be
exercised in whole or in part from time to time only for the purpose of covering
over-allotments which may be made in connection with the offering and
distribution of the Initial Securities upon notice by the Representative(s) to
the Company setting forth the number of Option Securities as to which the
several Underwriters are then exercising the option and the time and date of
payment and delivery for such Option Securities. Any such time and date of
delivery (a "Date of Delivery") shall be determined by the
Representative(s), but shall not be later than seven full business days after
the exercise of said option, nor in any event prior to the Closing Time, as
hereinafter defined. If the option is exercised as to all or any portion of the
Option Securities, each of the Underwriters, severally and not jointly, will
purchase that proportion of the total number of Option Securities then being
purchased which the number of Initial Securities each such Underwriter has
severally agreed to purchase as set forth in SCHEDULE A bears to the total
number of Initial Securities, subject to such adjustments as ▇▇▇▇▇▇▇ ▇▇▇▇▇ in
its discretion shall make to eliminate any sales or purchases of a fractional
number of Option Securities.
(c) PAYMENT. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
▇▇▇▇▇▇▇▇ Chance ▇▇▇▇▇▇ & ▇▇▇▇▇ LLP, or at such other place as shall be agreed
upon by the Representative(s) and the Company, at 10:00 A.M. (Eastern time) on
the third (fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any
given day) business day after the date hereof (unless postponed in accordance
with the provisions of Section 10), or such other time not later than ten
business days after such date as shall be agreed upon by the Representative(s)
and the Company (such time and date of payment and delivery being herein called
"Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Representative(s)
and the Company, on each Date of Delivery as specified in the notice from the
Representative(s) to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank accounts designated by the Company, against delivery
to the Representative(s) for the respective accounts of the Underwriters of
certificates for the Securities to be purchased by them. It is understood that
each Underwriter has authorized the Representative(s), for its account, to
accept delivery of, receipt for, and make payment of the purchase price for, the
Initial Securities and the Option Securities, if any, which it has agreed to
purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Initial Securities or the Option Securities, if any, to be
purchased by any Underwriter whose funds have not been received by the Closing
Time or the relevant Date of Delivery, as the case may be, but such payment
shall not relieve such Underwriter from its obligations hereunder.
(d) DENOMINATIONS; REGISTRATION. Certificates for the Initial Securities
and the Option Securities, if any, shall be in such denominations and registered
in such names as the Representative(s) may request in writing at least one full
business day before the Closing Time or the relevant Date of Delivery, as the
case may be. The certificates for the Initial Securities and the Option
Securities, if any, will be made available for examination and packaging by the
Representative(s) in The City of New York not later than 10:00 A.M. (Eastern
time) on the business day prior to the Closing Time or the relevant Date of
Delivery, as the case may be.
SECTION 3. COVENANTS OF THE COMPANY. Each of the Company and the Operating
Partnership covenants with each Underwriter as follows:
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
or Rule 434, as applicable, and will notify the Representative(s) immediately,
and confirm the notice in writing, (i) when any post-effective amendment to the
Registration Statement shall become effective, or any supplement to the
Prospectus or any amended Prospectus shall have been filed, (ii) of the receipt
of any comments from the Commission, (iii) of any request by the Commission for
any amendment to the Registration Statement or any amendment or supplement to
the Prospectus or for additional information, and (iv) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of any order preventing or suspending the use of any preliminary
prospectus, or of the suspension of the qualification of the Securities for
offering or sale in any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes. The Company will promptly effect the
filings necessary pursuant to Rule 424(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
make every reasonable effort to prevent the issuance of any stop order and, if
any stop order is issued, to obtain the lifting thereof at the earliest possible
moment.
(b) FILING OF AMENDMENTS. During the period a Prospectus is required to be
delivered under the 1933 Act, the Company will give the Representative(s) notice
of its intention to file or prepare any amendment to the Registration Statement
(including any filing under Rule 462(b)), any Term Sheet or any amendment,
supplement or revision to either the prospectus included in the Registration
Statement at the time it became effective or to the Prospectus, whether pursuant
to the 1933 Act, the 1934 Act or otherwise, will furnish the Representative(s)
with copies of any such documents a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file or use any such
document to which the Representative(s) or counsel for the Underwriters shall
object.
(c) DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished or will
deliver to the Representative(s) and counsel for the Underwriters, without
charge, one signed copy of the Registration Statement as originally filed and of
each amendment thereto (including conformed copies of 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 Representative(s), without
charge, a conformed copy of the Registration Statement as originally filed and
of each amendment thereto (without exhibits) for each of the Underwriters. The
copies of the Registration Statement and each amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
(d) DELIVERY OF PROSPECTUSES. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period
when the Prospectus is required to be delivered under the 1933 Act or the 1934
Act, such number of copies of the Prospectus (as amended or supplemented) as
such Underwriter may reasonably request. The Prospectus and any amendments or
supplements thereto furnished 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.
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the Securities
as contemplated in this Agreement and in the Prospectus. If at any time when a
prospectus is required by the 1933 Act to be delivered 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 or amend or supplement the
Prospectus in order that the Prospectus will not include any untrue statements
of a material fact or omit to state a material fact necessary in order to make
the statements therein not misleading in the light of the circumstances existing
at the time it is delivered to a purchaser, or if it shall be necessary, in the
opinion of such counsel, at any such time to amend the Registration Statement or
amend or supplement the Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and
file with the Commission, subject to Section 3(b), such amendment or supplement
as may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements, and the
Company will furnish to the Underwriters such number of copies of such amendment
or supplement as the Underwriters may reasonably request.
(f) BLUE SKY QUALIFICATIONS. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Securities for offering and
sale under the applicable securities laws of such states and other jurisdictions
(domestic or foreign) as the Representative(s) may designate and to maintain
such qualifications in effect for a period of not less than one year from the
later of the effective date of the Registration Statement and any Rule 462(b)
Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration Statement and any Rule
462(b) Registration Statement.
(g) RULE 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) REPORTING REQUIREMENTS. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
(i) USE OF PROCEEDS. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus under
"Use of Proceeds."
(j) REIT QUALIFICATION. The Company will use its best efforts to continue
to meet the requirement to qualify as a "real estate investment trust" under the
Code for each of its taxable years for so long as the board of trustees deems it
in the best interests of the Company's shareholders to remain so qualified.
(k) LISTING. The Company will use its best efforts to effect the listing
of the Securities on the American Stock Exchange.
(l) RESTRICTION ON SALE OF SECURITIES. During a period of 180 days from
the date of the Prospectus, neither the Company nor the Operating Partnership
will, without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, (i) directly or
indirectly, offer, pledge, sell, contract to sell, sell any option or contract
to purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase or otherwise transfer or dispose of any Common Shares or any
securities convertible into or exercisable or exchangeable for Common Shares or
file any registration statement under the 1933 Act with respect to any of the
foregoing or (ii) enter into any swap or any other agreement or any transaction
that transfers, in whole or in part, directly or indirectly, the economic
consequence of ownership of the Common Shares, whether any such swap or
transaction described in clause (i) or (ii) above is to be settled by delivery
of Common Shares or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to (A) the Securities to be sold hereunder, (B) any
Common Shares issued by the Company upon the exercise of an option or warrant or
the conversion of a security outstanding on the date hereof and referred to in
the Prospectus, (C) any Common Shares issued or options to purchase Common
Shares granted pursuant to existing employee benefit plans of the Company
referred to in the Prospectus, (D) any Common Shares issued pursuant to any
non-employee director stock plan or dividend reinvestment plan, (E) any Common
Shares issued pursuant to the Series A Purchase Rights and the Common Share
Purchase Rights and any Common Shares purchased pursuant to the Crescent
purchase as described in the Prospectus and (F) the filing of a resale shelf
registration statement pursuant to the terms of the registration rights
agreements, each dated as of September 27, 1999, between the Company and the
holders of securities listed therein; provided however, that the filing of any
such shelf registration statement shall not occur prior to September 27, 2001.
(m) NO MANIPULATION OF MARKET FOR SECURITIES. Except for the authorization
of actions permitted to be taken by the Underwriters as contemplated herein or
in the Prospectus, neither the Company nor the Operating Partnership will (a)
take, directly or indirectly, any action designed to cause or to result in, or
that might reasonably be expected to constitute, the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Securities, and (b) until the Closing Date, or the Date of
Delivery, if any, (i) sell, bid for or purchase the Securities or pay any person
any compensation for soliciting purchases of the Securities or (ii) pay or agree
to pay to any person any compensation for soliciting another to purchase any
other securities of the Company, except in each case for the Crescent purchase
as described in the Prospectus.
(n) RULE 462(B) REGISTRATION STATEMENT. If the Company elects to rely upon
Rule 462(b), the Company shall file a Rule 462(b) Registration Statement with
the Commission in compliance with Rule 462(b) by 10:00 P.M., Washington, D.C.
time, on the date of this Agreement, and the Company shall at the time of filing
either pay to the Commission the filing fee for the Rule 462(b) Registration
Statement or give irrevocable instructions for the payment of such fee pursuant
to Rule 111(b) under the ▇▇▇▇ ▇▇▇.
(o) PURCHASE RIGHTS. In the event the Company is obligated to issue Common
Shares pursuant to the Common Share Purchase Rights or the Series A Purchase
Rights, the Company shall enter into one or more purchase agreements with
▇▇▇▇▇▇▇ ▇▇▇▇▇ substantially in the form of this Agreement with respect to the
issuance and sale of the Common Shares to be issued pursuant to such purchase
rights.
SECTION 4. PAYMENT OF EXPENSES.
(a) EXPENSES. The Company will pay or cause to be paid all expenses
incident to the performance of their obligations under this Agreement, including
(i) the preparation, printing and filing of the Registration Statement
(including financial statements and exhibits) as originally filed and of each
amendment thereto, (ii) the preparation, printing and delivery to the
Underwriters of this Agreement, any Agreement among Underwriters and such other
documents as may be required in connection with the offering, purchase, sale,
issuance or delivery of the Securities, (iii) the preparation, issuance and
delivery of the certificates for the Securities to the Underwriters, including
any stock or other transfer taxes and any stamp or other duties payable upon the
sale, issuance or delivery of the Securities to the Underwriters, (iv) the fees
and disbursements of the Company's counsel, accountants and other advisors, (v)
the qualification of the Securities under securities laws in accordance with the
provisions of Section 3(f) hereof, including filing fees and the reasonable fees
and disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of the Blue Sky Survey and any supplement
thereto, (vi) the printing and delivery to the Underwriters of copies of each of
the preliminary prospectus, Prospectus and any amendments or supplements
thereto, (vii) the fees and expenses of any transfer agent or registrar for the
Securities, (ix) the filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review by
the National Association of Securities Dealers, Inc. (the "NASD") of the terms
of the sale of the Securities and (x) the fees and expenses incurred in
connection with the listing of the Securities on the American Stock Exchange.
(b) TERMINATION OF AGREEMENT. If this Agreement is terminated by the
Representative(s) in accordance with the provisions of Section 5 or Section
9(a), the Company shall reimburse the Underwriters for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the
several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Operating Partnership
contained in Section 1 hereof or in certificates of any officer or authorized
representative of the Company or the Operating Partnership delivered pursuant to
the provisions hereof, to the performance by the Company or the Operating
Partnership of its covenants and other obligations hereunder, and to the
following further conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the Underwriters. A prospectus containing
the Rule 430A Information shall have been filed with the Commission in
accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon Rule 434,
a Term Sheet shall have been filed with the Commission in accordance with Rule
424(b).
(b) OPINION OF COUNSEL FOR COMPANY. At Closing Time, the Representative(s)
shall have received the favorable opinions, dated as of Closing Time, of
▇▇▇▇▇▇▇▇ Chance ▇▇▇▇▇▇ & ▇▇▇▇▇ LLP, ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP, ▇▇▇▇,
Block, ▇▇▇▇▇▇ and ▇▇▇▇▇-▇▇▇▇▇ LLP, each counsel for the Company and the
Operating Partnership, in form and SUBSTANCE satisfactory to counsel for the
Underwriters, together with signed or reproduced copies of such letters for each
of the other Underwriters to the effect set forth in EXHIBIT A hereto and to
such further effect as counsel to the Underwriters may reasonably request.
(c) OPINION OF COUNSEL FOR UNDERWRITERS. At Closing Time, the
Representative(s) shall have received the favorable opinion, dated as of Closing
Time, of ▇▇▇▇▇ & Wood LLP, counsel for the Underwriters, together with signed or
reproduced copies of such letter for each of the other Underwriters with respect
to the matters set forth in clauses (i) (with respect to the first sentence
only), (iv) (with respect to the second sentence solely as to preemptive or
other similar rights arising by operation of law or under the charter or by-laws
of the Company), (vi), (vii), (xi) (SOLELY as to the information in the
Prospectus under "Description of Capital Stock--Common Shares"), the first
paragraph following (xviii) and the last paragraph of EXHIBIT A hereto. In
giving such opinion such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the law of the State of New York and the
federal law of the United States, upon the opinions of counsel satisfactory to
the Representative(s). Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company, the Operating Partnership and the
Subsidiaries and certificates of public officials.
(d) OFFICERS' CERTIFICATE. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of the
Company, the Operating Partnership, and the Subsidiaries considered as one
enterprise, WHETHER or not arising in the ordinary course of business, and the
Representative(s) shall have received a certificate of the President or a Vice
President of the Company, on behalf of the Company and as general partner of the
Operating Partnership, and of the chief financial or chief accounting officer of
the Company, on behalf of the Company and as general partner of the Operating
Partnership, dated as of Closing Time, to the effect that (i) there
has been no such material adverse change, (ii) the representations and
warranties in Section 1(a) hereof are true and correct with the same force and
effect as though expressly made at and as of Closing Time, (iii) each of the
Company and the Operating Partnership has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or prior to
Closing Time, and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been instituted or are pending or are contemplated by the Commission.
(e) ACCOUNTANT'S COMFORT LETTER. At the time of the execution of this
Agreement, the Representative(s) shall have received from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP a
letter dated such date, in form and substance satisfactory to the
Representative(s), together with signed or reproduced copies of such letter for
each of the other Underwriters containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.
(f) BRING-DOWN COMFORT LETTER. At Closing Time, the Representative(s)
shall have received from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP a letter, dated as of Closing Time,
to the effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (e) of this Section, except that the specified date
referred to shall be a date not more than three business days prior to Closing
Time.
(g) APPROVAL OF LISTING. At Closing Time, the Securities shall have been
approved for listing on the American Stock Exchange, subject only to official
notice of issuance.
(h) LOCK-UP AGREEMENTS. At the date of this Agreement, the
Representative(s) shall have received an agreement substantially in the form of
EXHIBIT B hereto signed by the persons listed on SCHEDULE C hereto.
(i) CONDITIONS TO PURCHASE OF OPTION SECURITIES. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to purchase
all or any portion of the Option Securities, the representations and warranties
of the Company and the Operating Partnership contained herein and the statements
in any certificates furnished by the Company, the Operating Partnership and any
Subsidiary shall be true and correct as of each Date of Delivery and, at the
relevant Date of Delivery, the Representative(s) shall have received:
(i) OFFICERS' CERTIFICATE. A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company, and of the
chief financial or chief accounting officer of the Company, confirming
that the certificate delivered at the Closing Time pursuant to Section
5(d) hereof remains true and correct as of such Date of Delivery.
(ii) OPINION OF COUNSEL FOR COMPANY. The favorable opinions of
▇▇▇▇▇▇▇▇ Chance ▇▇▇▇▇▇ & ▇▇▇▇▇ LLP, ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP,
Wolf, Block, ▇▇▇▇▇▇ and ▇▇▇▇▇-▇▇▇▇▇ LLP, each counsel for the Company and
the Operating Partnership, in form and substance satisfactory to counsel
for the Underwriters, dated
such Date of Delivery, relating to the Option Securities to be purchased
on such Date of Delivery and otherwise to the same effect as the opinions
required by Section 5(b) hereof.
(iii) OPINION OF COUNSEL FOR UNDERWRITERS. The favorable opinion of
▇▇▇▇▇ & Wood LLP, counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Securities to be purchased on such Date
of Delivery and otherwise to the same effect as the opinion required by
Section 5(c) hereof.
(iv) BRING-DOWN COMFORT LETTER. A letter from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP,
in form and substance satisfactory to the Representative(s) and dated such
Date of Delivery, substantially in the same form and substance as the
letter furnished to the Representative(s) pursuant to Section 5(f) hereof,
except that the "specified date" in the letter furnished pursuant to this
paragraph shall be a date not more than five days prior to such Date of
Delivery.
(j) ADDITIONAL DOCUMENTS. At Closing Time and at each Date of Delivery
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may require for the purpose of enabling them to pass upon the
issuance and sale of the Securities as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Securities
as herein contemplated shall be reasonably satisfactory in form and substance to
the Representative(s) and counsel for the Underwriters.
(k) TERMINATION OF AGREEMENT. If any condition specified in this Section 5
shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option Securities
on a Date of Delivery which is after the Closing Time, the obligations of the
several Underwriters to purchase the relevant Option Securities, may be
terminated by the Representative(s) by notice to the Company at any time at or
prior to Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party except as
provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any
such termination and remain in full force and effect.
SECTION 6. INDEMNIFICATION.
(a) INDEMNIFICATION OF UNDERWRITERS. Each of the Company and the Operating
Partnership agrees, jointly and severally, to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, and any
director, officer, employee or affiliate thereof as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A Information
and the Rule 434 Information, if applicable, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of
any untrue statement or
alleged untrue statement of a material fact included in any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), or
the omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; PROVIDED, HOWEVER, that
neither the Company nor the Operating Partnership shall be required under
this subsection (a)(i) to indemnify any Underwriter with respect to any
preliminary prospectus to the extent that any loss, claim, damage or
expense of such Underwriter results solely from an untrue statement of a
material fact contained in, or the omission of a material fact from, such
preliminary prospectus which untrue statement or omission was corrected in
the Prospectus and which corrected Prospectus was furnished by the Company
to such Underwriter pursuant to Section 3(d) hereof but was not sent or
given by such Underwriter to the purchaser of the Securities at or prior
to the written confirmation of such sale.
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided any such settlement is
effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by ▇▇▇▇▇▇▇ ▇▇▇▇▇), reasonably
incurred in investigating, preparing or defending against any litigation,
or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (i) or
(ii) above;
PROVIDED, HOWEVER, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS. Each Underwriter
severally agrees to indemnify and hold harmless the Company and the Operating
Partnership, each person, if any, who controls the Company within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act, and any officer,
director, trustee, employee or affiliate thereof, against any and all loss,
liability, claim, damage and expense described in the indemnity contained in
subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company
by such Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in the Registration
Statement (or any amendment thereto) or such preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by ▇▇▇▇▇▇▇ ▇▇▇▇▇, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
SECTION 7. CONTRIBUTION. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Operating Partnership on the one hand and the Underwriters on the other hand
from the offering of the Securities pursuant to this Agreement or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company and the
Operating Partnership on the one hand and of the Underwriters on the other hand
in connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company and the Operating
Partnership on the one hand and the Underwriters on the other hand in connection
with the offering of the Securities pursuant to this Agreement shall be deemed
to be in the same respective proportions as the total
net proceeds from the offering of the Securities pursuant to this Agreement
(before deducting expenses) received by the Company and the total underwriting
discount received by the Underwriters, in each case as set forth on the cover of
the Prospectus, or, if Rule 434 is used, the corresponding location on the Term
Sheet bear to the aggregate initial public offering price of the Securities as
set forth on such cover.
The relative fault of the Company and the Operating Partnership on the one
hand and the Underwriters on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or the Operating Partnership or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The Company, the Operating Partnership and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this Section
7. The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 7 shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each trustee of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the number of Initial Securities set forth opposite their
respective names in SCHEDULE A hereto and not joint. For purposes of this
Section 7, the Company and the Operating Partnership shall be deemed one party,
jointly and severally liable for any obligations hereunder.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
All representations, warranties and agreements contained in this Agreement or in
certificates of
officers of the Company or the Operating Partnership submitted pursuant hereto,
shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or controlling person, or
by or on behalf of the Company or the Operating Partnership, and shall survive
delivery of the Securities to the Underwriters.
SECTION 9. TERMINATION OF AGREEMENT.
(a) TERMINATION; GENERAL. The Representative(s) may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company, the Operating
Partnership and any of the Subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business, or (ii) if there has occurred
any material adverse change in the financial markets in the United States, any
outbreak of hostilities or escalation thereof or other calamity or crisis or any
change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Representative(s),
impracticable to market the Securities or to enforce contracts for the sale of
the Securities, or (iii) if trading in any securities of the Company has been
suspended or materially limited by the Commission or the American Stock
Exchange, or if trading generally on the American Stock Exchange or the New York
Stock Exchange or in the Nasdaq National Market has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system
or by order of the Commission, the National Association of Securities Dealers,
Inc. or any other governmental authority, or (iv) if a banking moratorium has
been declared by either Federal or New York authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7, 8 and 13 shall survive such termination and remain in full force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one or more of
the Underwriters shall fail at Closing Time or a Date of Delivery to purchase
the Securities which it or they are obligated to purchase under this Agreement
(the "Defaulted Securities"), the Representative(s) shall have the right, within
24 hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representative(s) shall not have
completed such arrangements within such 24-hour period, then:
(i) if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not jointly,
to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(ii) if the number of Defaulted Securities exceeds 10% of the number
of Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the Underwriters to purchase and of the Company to sell the
Option Securities to be purchased and sold on such Date of Delivery, shall
terminate without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after the Closing
Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Company to sell the relevant Option Securities,
as the case may be, either the (i) Representative(s) or (ii) the Company shall
have the right to postpone Closing Time or the relevant Date of Delivery, as the
case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or Prospectus or in any other
documents or arrangements. As used herein, the term "Underwriter" includes any
person substituted for an Underwriter under this Section 10.
SECTION 11. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representative(s) at North Tower, World
Financial Center, New York, New York 10281-1201, attention of ▇▇▇▇ ▇. Case III;
notices to the Company and the Operating Partnership shall be directed to it at
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
attention of General Counsel.
SECTION 12. PARTIES. This Agreement shall each inure to the benefit of and
be binding upon the Underwriters, the Company and the Operating Partnership and
their respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriters, the Company and the Operating Partnership and their
respective successors and the controlling persons and officers and directors
referred to in Sections 6 and 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
Underwriters and the Company and their respective successors, and said
controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Securities from any Underwriter shall be deemed to be a successor
by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE. UNLESS OTHERWISE EXPLICITLY
PROVIDED, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. EFFECT OF HEADINGS. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
among the Underwriters, the Company and the Operating Partnership in accordance
with its terms.
Very truly yours,
KEYSTONE PROPERTY TRUST
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Executive Vice President and Chief
Financial Officer
KEYSTONE OPERATING PARTNERSHIP, L.P.
By: Keystone Property Trust, its general partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Executive Vice President and Chief
Financial Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
CREDIT SUISSE FIRST BOSTON CORPORATION
FIRST UNION SECURITIES, INC.
By: ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
By: /s/ ▇▇▇▇ ▇. Case
---------------------------
Name: ▇▇▇▇ ▇. Case
Title: Authorized Signatory
SCHEDULE A
NUMBER OF
NAME OF UNDERWRITER INITIAL SECURITIES
------------------- ------------------
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ 4,500,000
Incorporated.............................................
Credit Suisse First Boston Corporation...................... 1,875,000
First Union Securities, Inc................................. 1,125,000
---------
Total.................................................... 7,500,000
=========
Sch A-1
SCHEDULE B
KEYSTONE PROPERTY TRUST
7,500,000 Common Shares of Beneficial Interest
(Par Value $.001 Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $12.20.
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be $11.575, being an amount equal to the initial
public offering price set forth above less $0.625 per share; provided that the
purchase price per share for any Option Securities purchased upon the exercise
of the over-allotment option described in Section 2(b) shall be reduced by an
amount per share equal to any dividends or distributions declared by the Company
and payable on the Initial Securities but not payable on the Option Securities.
Sch B-1
SCHEDULE C
1. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
2. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
3. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
4. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
5. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
6. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
7. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
8. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
9. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
10. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
11. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
12. ▇▇▇▇ ▇. ▇▇▇▇▇▇
13. ▇▇▇▇▇▇▇ ▇. Butte
14. ▇▇▇▇▇▇▇ ▇. ▇▇▇, ▇▇.
15. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
16. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
17. ▇▇▇▇ ▇. ▇▇▇▇▇
Sch C-1
EXHIBIT A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
(i) The Company has been duly organized and is validly existing as a
statutory real estate investment trust under Maryland REIT Law and is in good
standing with the State Department of Assessment and Taxation of Maryland. The
Company has the trust power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus and the
Company's declaration of trust and to enter into and perform its obligations
under the Purchase Agreement, and is duly qualified or registered as a foreign
real estate investment trust to transact business and is in good standing in
each jurisdiction identified in SCHEDULE 1 to our opinion, except where the
failure to so qualify or register or be in good standing would not result in a
Material Adverse Effect.
(ii) The issued and outstanding shares of beneficial interest of the
Company as set forth under the caption "Capitalization" in the Prospectus have
been duly authorized; all such issued and outstanding shares of beneficial
interest of the Company are validly issued, fully-paid and non-assessable and
conform, in all material respects, to the description thereof contained in the
Prospectus; to our knowledge, no shares of beneficial interest of the Company
are reserved for any purpose except as described in the Prospectus and for
common shares of beneficial interest reserved for issuance in connection with
the (i) conversion of the Preferred Stock, (ii) the conversion or exchange of
Units and (iii) the exercise of Options issued under the Plans. To our knowledge
and except for the Company's outstanding series of Preferred Stock, the Units or
Options issued under the Plans, there are no outstanding securities convertible
into or exchangeable for any shares of beneficial interest of the Company and no
outstanding preemptive or other similar rights (except for the Common Share
Purchase Rights or the Series A Purchase Rights) to purchase or subscribe for
such shares of beneficial interest or any other securities of the Company
arising under Maryland REIT Law or under the declaration of trust or by-laws of
the Company or any contracts to which the Company is a party of which we are
aware.
(iii) All of the outstanding 17,170,531 common units, 800,000 Series A
Convertible Preferred Units, 300,000 Series B Convertible Preferred Units,
2,461,094 Series C Convertible Preferred Units, 450,700 Series D Convertible
Preferred Units, 803,871 Series E Convertible Preferred Units and 800,000 Series
F Convertible Preferred Units have been duly authorized by the Operating
Partnership and, assuming that the holders of Units, as limited partners of the
Operating Partnership, do not participate in the control of the business of the
Operating Partnership, the Units represent valid and, subject to the
qualifications set forth herein, fully paid and nonassessable limited partner
interests in the Operating Partnership as to which the limited partners holding
Units, in their capacity as limited partners of the Operating Partnership, have
no liability in excess of their obligations to make contributions to the
Operating Partnership, their obligations to make other payments provided for in
the Operating Partnership Agreement and their share of the Operating
Partnership's assets and undistributed profits (subject to the obligation of a
limited partner of the Operating Partnership to repay any funds wrongfully
distributed to it). To our knowledge, except as described in the Prospectus and
except for common units exchangeable or convertible for preferred units and the
Cranbury Interest, no
A-1
Units are reserved for any purpose, there are no outstanding securities
convertible into or exchangeable for any Units and there are no preemptive or
other similar rights purchase or subscribe for Units or any other securities of
the Operating Partnership arising under the DRULPA (as defined below) or under
the Operating Partnership Agreement or any contracts to which the Operating
Partnership is a party of which we are aware.
(iv) The Securities to be purchased by the Underwriters from the Company
have been duly authorized for issuance and sale to the Underwriters pursuant to,
and in accordance with the terms of, the Purchase Agreement and, when issued and
delivered by the Company pursuant to the Purchase Agreement against payment of
the consideration set forth in the Purchase Agreement, will be validly issued
and, subject to the qualifications set forth herein, fully paid and
nonassessable and, except for the Series A Purchase Rights and the Common Share
Purchase Rights, the issuance and sale of the Securities by the Company is not
subject to any preemptive or other similar rights to purchase or subscribe for
shares of beneficial interest of the Company arising under Maryland REIT Law or
the declaration of trust and by-laws of the Company.
(v) The Operating Partnership has been duly organized and is validly
existing as a limited partnership in good standing under the laws of the State
of Delaware and has the requisite power and authority to own, lease and operate
its properties and to conduct the business in which it is engaged as described
in the Operating Partnership Agreement and the Prospectus and is duly qualified
or registered as a foreign limited partnership to transact business and is in
good standing in each jurisdiction listed in SCHEDULE 1 to our opinion, except
where the failure to so qualify or register or to be in good standing would not
result in a Material Adverse Effect.
(vi) The execution and delivery of the Purchase Agreement have been duly
authorized by all necessary action of the Company and the Operating Partnership,
and the Purchase Agreement has been duly executed and delivered by the Company
and the Operating Partnership.
(vii) The Registration Statement, at the time that it became effective, and
the Prospectus, as of its date and as of the date hereof (in each case, other
than documents incorporated by reference therein and the financial statements,
supporting schedules and other financial data included or incorporated by
reference therein or omitted therefrom and for statistical information derived
from such financial statements, supporting schedules or other financial data, as
to which no opinion is rendered), complied as to form, in all material respects,
with the applicable requirements of the Securities Act and the Regulations.
(viii) The documents incorporated by reference in the Prospectus (other
than the financial statements, supporting schedules and other financial data
included or incorporated by reference therein or omitted therefrom and for
statistical information derived from such financial statements, supporting
schedules or other financial data, as to which no opinion is rendered), when
they became effective or were filed with the Commission, as the case may be,
complied as to form, in all material respects, with the requirements of the 1933
Act, the Regulations, the Securities and Exchange Act of 1934, as amended, and
the rules and regulations of the Commission thereunder, as applicable.
A-2
(ix) The form of certificate used to evidence the common shares of
beneficial interest of the Company complies, in all material respects, with all
applicable Maryland REIT Law requirements, with any applicable requirements of
the declaration of trust and by-laws of the Company and the requirements of the
American Stock Exchange.
(x) To our knowledge and except as described or incorporated by reference
in the Prospectus, there is not pending or threatened any action, suit,
proceeding, inquiry or investigation, to which the Company, the Operating
Partnership or any Subsidiary is a party, or to which the property of the
Company, the Operating Partnership or any Subsidiary is subject, before or
brought by any court or governmental agency or body, domestic or foreign, which
might reasonably be expected to result in a Material Adverse Effect or to affect
the consummation of the transactions contemplated in the Purchase Agreement or
the performance by the Company or the Operating Partnership of their respective
obligations thereunder.
(xi) The information in the Base Prospectus under "Description of Shares of
Beneficial Interest --Common Shares," "Description of Shares of Beneficial
Interest --Preferred Shares," and "Certain Federal Income Tax Considerations" to
the extent that it constitutes matters of law, summaries of legal matters, the
Company's declaration of trust and by-laws, legal proceedings or legal
conclusions, has been reviewed by us and is correct in all material respects.
(xii) To our knowledge, there are no Maryland, New York, DRULPA or U.S.
federal securities statutes or regulations that are required to be described in
the Prospectus that are not described as required.
(xiii) Commencing with its taxable year ended December 31, 1993, the
Company was organized and has been operated in conformity with the requirements
for qualification as a real estate investment trust under the Internal Revenue
Code of 1986, as amended (the "Code") and the proposed method of operation of
the Company and the Operating Partnership, as described in the Prospectus and as
represented by the Company and the Operating Partnership, will permit the
Company to continue to so qualify.
(xiv) All descriptions in the Registration Statement of contracts and other
documents which are filed as exhibits to the 10-K and to the Current Reports on
Form 8-K of the Company filed with the Commission on April 5, 2001 and April 19,
2001 (the "8-Ks") to which the Company, the Operating Partnership or any
Subsidiary is a party are accurate in all material respects. To our knowledge,
there are no franchises, contracts, indentures, mortgages, loan agreements,
notes, leases or other instruments required to be described or referred to
therein or filed or incorporated by reference as exhibits thereto that were not
so filed, incorporated by reference or described as required (except that the
1994 Plan was not filed as an exhibit to the 10-K). To our knowledge, (i)
neither the Company nor the Operating Partnership is in violation of its
Governing Instruments and (ii) except that the Company did not provide the
notice required by the Common Share Rights or the Series A Rights on a timely
basis, no default by the Company or the Operating Partnership exists in the due
performance or observance of any material obligation, agreement, covenant or
condition contained in any agreement filed as an exhibit to the 10-K or the
8-Ks, except for such defaults that would not result in a Material Adverse
Effect.
A-3
(xv) No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any U.S. federal, Maryland, Delaware
or New York State court or governmental authority or agency, domestic or foreign
(other than under the Securities Act and the Regulations, which have been
obtained, or as may be required under the securities or blue sky laws of the
various states or the rules and regulations of the NASD, as to which we express
no opinion) is necessary or required in connection with the due authorization,
execution and delivery of the Purchase Agreement or for the offering, issuance,
sale or delivery of the Securities.
(xvi) The execution, delivery and performance of the Purchase Agreement by
the Company and the consummation of the transactions contemplated in the
Purchase Agreement and in the Prospectus (including the issuance and sale of the
Securities and the use of the proceeds from the sale of the Securities as
described in the Prospectus under the caption "Use of Proceeds") and compliance
by the Company with its obligations under the Purchase Agreement does not and
will not (i) whether with or without the giving of notice or lapse of time or
both, conflict with or constitute a breach of, or default or Repayment Event
under, or result in the creation or imposition of any material lien, charge or
encumbrance upon any material property or assets of the Company or the Operating
Partnership pursuant to any contract listed as an exhibit to the 10-K or the 8-K
to which the Company or the Operating Partnership is a party or by which it or
any of them may be bound or to which any of the property or assets of the
Company or the Operating Partnership is subject, (ii) result in any violation of
the provisions of the Governing Instruments of the Company or the Operating
Partnership, or (iii) result in any violation of any applicable Maryland, New
York, DRULPA or U.S. federal securities law, statute, rule, regulation,
judgement, order, writ or decree, known to us, of any Maryland, Delaware, New
York or U.S. federal government, government instrumentality or court, domestic
or foreign, having jurisdiction over the Company or the Operating Partnership or
any of their respective assets or properties, except in the case of clauses (i)
and (iii) above, for such conflicts, breaches or defaults or liens, charges,
encumbrances or Repayment Events that would not result in a Material Adverse
Effect.
(xvii) To our knowledge, there are no persons with registration rights (or
other similar rights)to have any securities of the Company registered pursuant
to the Registration Statement or otherwise registered by the Company under the
Securities Act in connection with the issuance and sale of the Securities.
(xviii) Neither the Company nor the Operating Partnership is an "investment
company" or an entity "controlled" by an "investment company," as such terms are
defined in the 1940 Act.
In addition, we have participated in the preparation of the Registration
Statement and the Prospectus and participated in discussions with certain
officers, trustees and employees of the Company, representatives of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP, the independent accountants who examined the financial statements
of the Company included or incorporated by reference in the Registration
Statement and the Prospectus, and you and your representatives and we have
reviewed certain trust and partnership records and documents. While we have not
independently verified and are not passing upon, and do not assume any
responsibility for, the accuracy, completeness or fairness of the information
contained in the Registration Statement and the Prospectus (including any of the
documents incorporated by reference therein except as set forth
A-4
in opinion (xi) above), on the basis of such participation and review,
nothing has come to our attention that would lead us to believe that the
Registration Statement (except for financial statements, supporting schedules
and other financial data included or incorporated by reference therein or
omitted therefrom and for statistical information derived from such financial
statements, supporting schedules or other financial data, as to which we do not
express any belief), at the time such Registration Statement became effective,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus (except for financial statements,
supporting schedules and other financial data included or incorporated by
reference therein or omitted therefrom and for statistical information derived
from such financial statements, supporting schedules or other financial data, as
to which we do not express any belief), at the time the Prospectus was issued,
or at the Closing Time, included or includes an untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
The opinions set forth in this letter relate only to the federal securities
laws of the United States, and the laws of the State of New York, the Maryland
REIT Law and the Revised Uniform Limited Partnership Act of Delaware ("DRULPA").
With respect to matters concerning the DRULPA involved in the opinions set forth
above, we draw to your attention that the members of our firm are not admitted
to practice law in the State of Delaware. To the extent that any opinions stated
herein relate to the laws of the State of Maryland, with your permission and
without independent investigation, we have relied upon the opinion of ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP, dated the date hereof, a copy of which has been
delivered to you. Our opinion, to the extent based upon such reliance, is
limited by the qualifications, assumptions and conditions set forth in such
opinion in addition to those set forth herein. We express no opinion (A) as to
the enforceability of forum selection clauses in the federal courts or (B) with
respect to the requirements of, or compliance with, any state securities or blue
sky or real estate syndication laws.
We have been informed by the Staff of the Commission that the Registration
Statement is effective under the Securities Act and, to our knowledge, no stop
order suspending the effectiveness of the Registration Statement has been issued
under the Securities Act or proceedings therefor initiated or threatened by the
Commission.
A-5
EXHIBIT B
[FORM OF LOCK-UP FROM DIRECTORS, OFFICERS OR OTHER STOCKHOLDERS
PURSUANT TO SECTION 5(k)]
April __, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated,
as Representative(s) of the several
Underwriters to be named in the
within-mentioned Purchase Agreement
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: PROPOSED PUBLIC OFFERING BY KEYSTONE PROPERTY TRUST
Dear Sirs:
The undersigned, a stockholder [and an officer and/or director] of Keystone
Property Trust, a Maryland real estate investment trust (the "Company"),
understands that ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") propose(s) to enter into a Purchase Agreement
(the "Purchase Agreement") with the Company providing for the public offering of
shares (the "Securities") of the Company's common shares of beneficial interest,
par value $.001 per share (the "Common Shares"). In recognition of the benefit
that such an offering will confer upon the undersigned as a stockholder [and an
officer and/or director] of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with each underwriter to be named in the Purchase Agreement
that, during a period of 180 days from the date of the Purchase Agreement, the
undersigned will not, without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇,
directly or indirectly, (i) offer, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant for the sale of, or otherwise dispose of or transfer any of the
Company's Common Shares or any securities convertible into or exchangeable or
exercisable for Common Shares, whether now owned or hereafter acquired by the
undersigned or with respect to which the undersigned has or hereafter acquires
the power of disposition, (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or indirectly, the
economic consequence of ownership of the Common Shares, whether any such swap or
transaction is to be settled by delivery of Common Shares or other securities,
in cash or otherwise, except that the undersigned shall be permitted to pledge
his or her Common Shares or securities convertible into or exchangeable or
exercisable for Common Shares.
Very truly yours,
Signature:
------------------------
Print Name:
----------------------
B-1
ANNEX A
[FORM OF ACCOUNTANTS' COMFORT LETTER PURSUANT TO SECTION 5(g)]
[We are independent public accountants with respect to the Company within the
meaning of the 1933 Act and the applicable published 1933 Act Regulations]
(i) in our opinion, the audited financial statements [and the related
financial statement schedules] included in the Registration Statement and
the Prospectus comply as to form in all material respects with the
applicable accounting requirements of the 1933 Act and the published rules
and regulations thereunder;
(ii) on the basis of procedures (but not an examination in accordance
with generally accepted auditing standards) consisting of a reading of the
latest available unaudited interim [consolidated] financial statements of
the Company], a reading of the minutes of all meetings of the stockholders
and directors of the Company and its subsidiaries and Committees of the
Company's Board of Directors since [day after end of last audited period],
inquiries of certain officials of the Company and its subsidiaries
responsible for financial and accounting matters, a review of interim
financial information in accordance with standards established by the
American Institute of Certified Public Accountants in Statement on Auditing
Standards No. 71, Interim Financial Information ("SAS 71"), with respect to
the [description of relevant periods] and such other inquiries and
procedures as may be specified in such letter, nothing came to our
attention that caused us to believe that:
( ) at _________, 2001 and at a specified date not more than five
days prior to the date of this Agreement, there was any change in the
___________ of the Company [and its subsidiaries] or any decrease in
the __________ of the Company [and its subsidiaries] or any increase
in the __________ of the Company [and its subsidiaries,]/1 in each
case as compared with amounts shown in the latest balance sheet
included in the Registration Statement, except in each case for
changes, decreases or increases that the Registration Statement
discloses have occurred or may occur; or
( ) [for the period from _________, 2001 to _________, 2001 and]
for the period from _________, 2001 to a specified date not more than
five days prior to the date of this Agreement, there was any decrease
in _________, __________ or ___________, in each case as compared with
the comparable
-------------------
/1 The blanks should be filled in with significant balance sheet items,
selected by the banker and tailored to the issuer's industry in general and
operations in particular. While the ultimate decision of which items should
be included rests with the banker, comfort is routinely requested for
certain balance sheet items, including long-term debt, stockholders'
equity, capital stock and net current assets.
Annex
period in the preceding year, except in each case for any decreases
that the Registration Statement discloses have occurred or may occur;
(iii) based upon the procedures set forth in clause (ii) above
and a reading of the Selected Financial Data included in the
Registration Statement and a reading of the financial statements from
which such data were derived, nothing came to our attention that
caused us to believe that the Selected Financial Data included in the
Registration Statement do not comply as to form in all material
respects with the disclosure requirements of Item 301 of Regulation
S-K of the 1933 Act, that the amounts included in the Selected
Financial Data are not in agreement with the corresponding amounts in
the audited [consolidated] financial statements for the respective
periods or that the financial statements not included in the
Registration Statement from which certain of such data were derived
are not in conformity with generally accepted accounting principles;
(iv) we have compared the information in the Registration
Statement under selected captions with the disclosure requirements of
Regulation S-K of the 1933 Act and on the basis of limited procedures
specified herein. nothing came to our attention that caused us to
believe that this information does not comply as to form in all
material respects with the disclosure requirements of Items 302, 402
and 503(d), respectively, of Regulation S-K;
(v) based upon the procedures set forth in clause (ii) above, a
reading of the unaudited financial statements of the Company for
[identify the most recent period] that have not been included in the
Registration Statement and a review of such financial statements in
accordance with SAS 71, nothing came to our attention that caused us
to believe that the unaudited amounts for _____________ for the
[identify the most recent period] do not agree with the amounts set
forth in the unaudited consolidated financial statements for those
periods or that such unaudited amounts were not determined on a basis
substantially consistent with that of the corresponding amounts in the
audited consolidated financial statements;
(vi) we are unable to and do not express any opinion on the [Pro
Forma Combining Statement of Operations] (the "Pro Forma Statement")
included in the Registration Statement or on the pro forma adjustments
applied to the historical amounts included in the Pro Forma Statement;
however, for purposes of this letter we have:
(A) read the Pro Forma Statement;
(B) performed a review in accordance with SAS 71 of the
financial statements to which the pro forma adjustments were
applied;
(C) made inquiries of certain officials of the Company who
have responsibility for financial and accounting matters about
the basis for their
Annex
determination of the pro forma adjustments and whether the Pro
Forma Statement complies as to form in all material respects with
the applicable accounting requirements of Rule 11-02 of
Regulation S-X; and
(D) proved the arithmetic accuracy of the application of the
pro forma adjustments to the historical amounts in the Pro Forma
Statement; and
on the basis of such procedures and such other inquiries and
procedures as specified herein, nothing came to our attention that
caused us to believe that the Pro Forma Statement included in the
Registration Statement does not comply as to form in all material
respects with the applicable requirements of Rule 11-02 of Regulation
S-X or that the pro forma adjustments have not been properly applied
to the historical amounts in the compilation of those statements; and
(vii) in addition to the procedures referred to in clause (ii)
above, we have performed other procedures, not constituting an audit,
with respect to certain amounts, percentages, numerical data and
financial information appearing in the Registration Statement, which
are specified herein, and have compared certain of such items with,
and have found such items to be in agreement with, the accounting and
financial records of the Company.
Annex