Cogdell Spencer Inc. Common Stock UNDERWRITING AGREEMENT May 27, 2009 Citigroup Global Markets Inc. KeyBanc Capital Markets Inc.
Exhibit 1.1
Execution Copy
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc.
Common Stock
May 27, 2009
Citigroup Global Markets Inc.
KeyBanc Capital Markets Inc.
KeyBanc Capital Markets Inc.
May 27, 2009
Citigroup Global Markets Inc.
KeyBanc Capital Markets Inc.
As Representatives of the several Underwriters,
c/o Citigroup Global Markets Inc.
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▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
KeyBanc Capital Markets Inc.
As Representatives of the several Underwriters,
c/o Citigroup Global Markets Inc.
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▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc., a corporation organized under the laws of the State of Maryland (the
’Company”), proposes to issue and sell to the several underwriters named in Schedule I hereto (the
’Underwriters”), for whom you (the “Representatives”) are acting as representatives, 20,000,000
shares of its common stock, $0.01 par value (“Common Stock”) (said shares to be issued and sold by
the Company being hereinafter called the “Underwritten Securities”). The Company also proposes to
grant to the Underwriters an option to purchase up to 3,000,000 additional shares of Common Stock
(the “Option Securities”; the Option Securities, together with the Underwritten Securities, being
hereinafter called the “Securities”). Certain terms used herein are defined in Section 19 hereof.
The Company is the sole general partner of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇, a Delaware limited partnership
(the “Operating Partnership”), the Company’s operating partnership subsidiary.
1. Representations and Warranties. Each of the Company and the Operating Partnership,
jointly and severally, represents and warrants to, and agrees with, each Underwriter as set forth
below in this Section 1.
(a) The Company has prepared and filed with the Commission a registration statement on
Form S-3 (File No. 333-138426), which contains a base prospectus (the “Base Prospectus”), to
be used in connection with the public offering and sale of the Securities. Such
registration statement, as amended, including the financial statements, exhibits and
schedules thereto, at each time of effectiveness under the Securities Act, including any
required information deemed to be a part thereof at the time of effectiveness pursuant to
Rule 430B under the Securities Act or the Exchange Act, is called the “Registration
Statement.” Any registration statement filed by the Company pursuant to Rule 462(b) under
the Securities Act is called the “Rule 462(b) Registration Statement,” and from and after
the date and time of filing of the Rule 462(b) Registration Statement the term “Registration
Statement” shall include the Rule 462(b)
Registration Statement. Any preliminary prospectus supplement to the Base Prospectus
that describes the Securities and the offering thereof and is used prior to filing of the
final prospectus is called, together with the Base Prospectus, a “preliminary prospectus.”
The term “Prospectus” shall mean the final prospectus relating to the Securities that is
first filed pursuant to Rule 424(b) after the date and time that this Agreement is executed
and delivered by the parties hereto (the “Execution Time”). Any reference herein to the
Registration Statement, any preliminary prospectus or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein pursuant to Item 12 of
Form S-3 under the Securities Act; any reference to any amendment or supplement to any
preliminary prospectus or the Prospectus shall be deemed to refer to and include any
documents filed after the date of such preliminary prospectus or Prospectus, as the case may
be, under the Exchange Act, and incorporated by reference in such preliminary prospectus or
Prospectus, as the case may be; and any reference to any amendment to the Registration
Statement shall be deemed to refer to and include any annual report of the Company filed
pursuant to Section 13(a) or 15(d) of the Exchange Act after the effective date of the
Registration Statement that is incorporated by reference in the Registration Statement.
(b) On the Effective Date, the Registration Statement did or will, and when the
Prospectus is first filed (if required) in accordance with Rule 424(b) and on the Closing
Date (as defined herein) and on any date on which Option Securities are purchased, if such
date is not the Closing Date (a “settlement date”), the Prospectus (and any supplements
thereto) will, comply in all material respects with the applicable requirements of the
Securities Act; each preliminary prospectus and the Prospectus when filed was identical to
the copy thereof delivered to the Underwriters for use in connection with the offer and sale
of the Securities; on the Effective Date and at the Execution Time, the Registration
Statement did not or will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to make the
statements therein not misleading; and, on the Effective Date, the Prospectus, if not filed
pursuant to Rule 424(b), will not, and on the date of any filing pursuant to Rule 424(b) and
on the Closing Date and any settlement date, the Prospectus (together with any supplement
thereto) will not, include any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the Company makes no representations or warranties as to the information contained in
or omitted from the Registration Statement, or the Prospectus (or any supplement thereto) in
reliance upon and in conformity with information furnished in writing to the Company by or
on behalf of any Underwriter through the Representatives specifically for inclusion in the
Registration Statement or the Prospectus (or any supplement thereto), it being understood
and agreed that the only such information furnished by or on behalf of any Underwriter
consists of the information described as such in Section 8 hereof. The Company has complied
to the Commission’s satisfaction with all requests of the Commission for additional or
supplemental information. No stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued and no proceeding for that purpose has been
instituted or, to the knowledge of the Company, threatened by the Commission or by the state
securities authority of any jurisdiction. No order preventing or suspending the use of the
Prospectus has been issued and no
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proceeding for that purpose has been instituted by the Commission or by the state
securities authority of any jurisdiction.
(c) All documents filed by the Company pursuant to Sections 12, 13, 14 or 15 of the
Exchange Act and incorporated by reference into the Prospectus, when they became effective
or were filed with the Commission, as the case may be, complied in all material respects
with the requirements of the Securities Act and the rules thereunder or the Exchange Act and
the rules thereunder, as applicable. Any further documents so filed and incorporated by
reference in the Prospectus or any further amendment or supplement thereto, when such
documents become effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Securities Act or the Exchange
Act, as applicable, and the rules and regulations of the Commission thereunder.
(d) As of 8:30 a.m. (Eastern time) on the date of execution and delivery of this
Agreement (the “Applicable Time”), the Disclosure Package did not contain any untrue
statement of a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not
misleading. The preceding sentence does not apply to statements in or omissions from the
Disclosure Package based upon and in conformity with written information furnished to the
Company by the Representatives specifically for use therein, it being understood and agreed
that the only such information furnished by or on behalf of any Underwriter consists of the
information described as such in Section 8 hereof.
(e) (i) At the time of filing the Registration Statement and (ii) as of the Execution
Time (with such date being used as the determination date for purposes of this clause (ii)),
the Company was not and is not an Ineligible Issuer (as defined in Rule 405), without taking
account of any determination by the Commission pursuant to Rule 405 that it is not necessary
that the Company be considered an Ineligible Issuer.
(f) Each Issuer Free Writing Prospectus, if any, as of its issue date and at all
subsequent times through the completion of the offering of Securities under this Agreement
or until any earlier date that the Company notified or notifies the Representatives as
described in the next sentence, did not, does not and will not include any information that
conflicted, conflicts or will conflict with the information contained in the Registration
Statement, including any prospectus or prospectus supplement that is or becomes part of the
Registration Statement. If at any time following issuance of an Issuer Free Writing
Prospectus there occurred or occurs an event or development as a result of which such Issuer
Free Writing Prospectus conflicted or would conflict with the information contained in the
Registration Statement, the Company has promptly notified or will promptly notify the
Representatives and has promptly amended or supplemented or will promptly amend or
supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate or correct
such conflict. The foregoing two sentences do not apply to statements in or omissions from
any Issuer Free Writing Prospectus based upon and in conformity with written information
furnished to the Company by the Representatives specifically for use therein, it being
understood and agreed that the only
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such information furnished by the Representatives consists of the information described
as such in Section 8 hereof.
(g) (i) The Company (x) has been duly incorporated and is, or will be as of the Closing
Date, validly existing as a corporation in good standing under the laws of the State of
Maryland with full corporate power and authority to own or lease, as the case may be, and to
operate its properties and conduct its business as described in the Disclosure Package and
the Prospectus, and to enter into and perform its obligations under this Agreement and, as
general partner of the Operating Partnership, through its wholly-owned Maryland business
trust, to cause the Operating Partnership to enter into and perform the Operating
Partnership’s obligations under this Agreement and (y) is duly qualified to do business as a
foreign corporation and is in good standing under the laws of each jurisdiction which
requires such qualification, except where the failure to be so qualified and in good
standing would not reasonably be expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or properties of the Company and its
Subsidiaries (as defined below) taken as a whole.
(ii) The Operating Partnership has been duly formed and is validly existing as a
limited partnership in good standing under the laws of the State of Delaware with full power
and authority to own or lease, as the case may be, and to operate its properties and conduct
its business as described in the Disclosure Package and the Prospectus and to enter into and
perform its obligations under this Agreement, and is duly qualified to do business and is in
good standing as a foreign limited partnership under the laws of each jurisdiction which
requires such qualification, except where the failure to be so qualified and in good
standing would not reasonably be expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or properties of the Company and its
Subsidiaries. At the Closing Date, the aggregate percentage interests of the Company and
the limited partners in the Operating Partnership will be as set forth in the Prospectus;
provided, that to the extent any portion of the option to purchase additional shares
described in Section 2(b) hereof is exercised at the Closing Date, the percentage interest
of the Company and of such limited partners in the Operating Partnership will be adjusted
accordingly.
(iii) Each Subsidiary of the Company listed on Schedule 1(c) hereto (each a
“Subsidiary” and together, the “Subsidiaries”) has been duly formed and is, or will be as of
the Closing Date, validly existing as a corporation, business trust, limited liability
company or limited partnership, as the case may be, in good standing under the laws of the
jurisdiction in which it is chartered or organized with full power and authority (corporate
and other) to own or lease, as the case may be, and to operate its properties and conduct
its business as described in the Disclosure Package and the Prospectus, and is duly
qualified to do business as a foreign corporation, business trust, limited liability company
or limited partnership, as the case may be, and is in good standing under the laws of each
jurisdiction which requires such qualification.
(h) The statements in the Disclosure Package and the Prospectus under the headings
“Material U.S. Federal Income Tax Considerations” and “U.S. Federal Income Tax
Considerations” insofar as such statements summarize legal matters, agreements,
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documents or proceedings discussed therein, are accurate and fair summaries of such
legal matters, agreements, documents or proceedings.
(i) All the outstanding shares of capital stock or other ownership interests of each
Subsidiary of the Company have been duly and validly authorized and issued and are fully
paid and nonassessable, and, except as otherwise set forth in the Disclosure Package and the
Prospectus, all outstanding shares of capital stock or other ownership interests of the
Subsidiaries are owned by the Company either directly or through wholly owned Subsidiaries
free and clear of any perfected security interest or any other security interests, claims,
mortgages, pledges, liens, encumbrances or other restrictions of any kind (collectively,
“Liens”), except for Liens securing indebtedness as described in the Disclosure Package and
the Prospectus. Except as set forth in the Disclosure Package and the Prospectus, there are
no outstanding options, warrants or other rights to purchase, agreements or other
obligations to issue, or rights to convert any obligations into or exchange any securities
or interests for capital stock or other ownership interests of any Subsidiary of the
Company.
(j) The Company’s authorized equity capitalization is as set forth in the Disclosure
Package and the Prospectus under the caption “Capitalization”; the capital stock of the
Company conforms in all material respects to the description thereof contained in the
Disclosure Package and the Prospectus; the outstanding shares of Common Stock have been duly
and validly authorized and issued and are fully paid and nonassessable; the Securities have
been duly and validly authorized, and, when issued and delivered to and paid for by the
Underwriters pursuant to this Agreement, will be fully paid and nonassessable; the
Securities are duly listed, and admitted and authorized for trading, subject to official
notice of issuance and evidence of satisfactory distribution, on the New York Stock
Exchange; the certificates for the Securities are in valid and sufficient form; the holders
of outstanding shares of capital stock of the Company are not entitled to preemptive or
other rights to subscribe for the Securities; and, except as set forth in the Disclosure
Package and the Prospectus, no options, warrants or other rights to purchase, agreements or
other obligations to issue, or rights to convert any obligations into or exchange any
securities for, shares of Common Stock of or ownership interests in the Company are
outstanding; all offers and sales of the Company’s shares of Common Stock prior to the date
hereof were at all relevant times duly registered under the Securities Act or were exempt
from the registration requirements of the Securities Act and were duly registered or the
subject of an available exemption from the registration requirements of the applicable state
securities or blue sky laws.
(k) The outstanding units of limited partnership (“Units”) of the Operating Partnership
have been duly authorized for issuance by the Operating Partnership and are validly issued
and fully paid. None of the Units were issued in violation of the preemptive or other
similar rights of any security holder of the Operating Partnership or any other person or
entity. Except as set forth in the Disclosure Package and the Prospectus, there are no
outstanding options, warrants or other rights to purchase, agreements or other obligations
to issue, or rights to convert any obligations into or exchange any securities or interests
for, Units or other ownership interests of the Operating Partnership. All offers and sales
of the Company’s Units prior to the date
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hereof were at all relevant times duly registered under the Securities Act or were
exempt from the registration requirements of the Securities Act and were duly registered or
the subject of an available exemption from the registration requirements of the applicable
state securities or blue sky laws.
(l) There is no agreement, contract or other document of a character required to be
described in the Registration Statement or Prospectus, or to be filed as an exhibit thereto,
which is not described or filed as required; and the statements in the Prospectus and any
document that is incorporated by reference therein under the headings “Management’s
Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and
Capital Resources,” “▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ Partnership Agreement,” “Description of Common
Stock,” “Description of Preferred Stock,” “Description of Depositary Shares,” “Description
of Warrants,” “Description of Rights,” and “Certain Provisions of Maryland Law and of our
Charter and Bylaws,” and insofar as such statements summarize legal matters, agreements,
documents or proceedings discussed therein, are accurate and fair summaries of such legal
matters, agreements, documents or proceedings.
(m) There are no material transfer taxes or other similar fees or charges under federal
law or the laws of any state, or any political subdivision thereof, required to be paid by
the Company, the Operating Partnership, or their Subsidiaries in connection with the
execution and delivery of this Agreement or the issuance by the Company or sale and delivery
by the Company of the Securities.
(n) This Agreement has been duly authorized, executed and delivered by the Company and
the Operating Partnership; this Agreement constitutes a legally valid and binding obligation
of each of the Company and the Operating Partnership, enforceable against each of the
Company and the Operating Partnership in accordance with its terms, except to the extent
that such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, moratorium and other similar laws affecting creditors’ rights
and general principles of equity, and except as to rights to indemnity and contribution
thereunder may be limited by applicable law or policies underlying such law.
(o) Each of the Company and the Operating Partnership is not and, after giving effect
to the offering and sale of the Securities and the application of the proceeds thereof as
described in the Prospectus, will not be an “investment company” as defined in the
Investment Company Act of 1940, as amended (the “Investment Company Act”).
(p) There are no persons with registration or other similar rights to have any equity
or debt securities registered for sale under the Registration Statement or included in the
offering contemplated by this Agreement.
(q) No consent, approval, authorization, filing with or order of any court or
governmental agency or body is required in connection with the transactions contemplated
herein, except such as have been obtained under the Securities Act, such as may be required
under the blue sky laws of any jurisdiction in connection with the
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purchase and distribution of the Securities by the Underwriters in the manner
contemplated herein and in the Prospectus or the absence of which, individually or in the
aggregate, would not reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or properties of the
Company and its Subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business.
(r) Neither the issuance and sale of the Securities nor the consummation of any other
of the transactions herein contemplated nor the fulfillment of the terms hereof will
conflict with, result in a breach or violation of, or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its Subsidiaries pursuant
to, (i) the charter or bylaws of the Company or the organizational or other governing
documents of any of its Subsidiaries, (ii) the terms of any indenture, contract, lease,
mortgage, deed of trust, franchise, note, loan agreement or other agreement, obligation,
condition, covenant or instrument to which the Company or any of its Subsidiaries is a party
or bound or to which its or their property is subject, or (iii) any statute, law, rule,
regulation, judgment, order or decree applicable to the Company or any of its Subsidiaries
of any court, regulatory body, administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company or any of its Subsidiaries or any of its or
their properties, except, in the case of clauses (ii) or (iii) above, for such conflicts,
breaches, violations, liens, charges or encumbrances that, individually or in the aggregate,
would not reasonably be expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or properties of the Company and its
Subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary
course of business.
(s) Except as set forth in the Disclosure Package and the Prospectus, and any document
that is incorporated by reference therein, there are no contracts, agreements or
understandings between the Company or the Operating Partnership and any person granting such
person the right to require the Company or the Operating Partnership to file a registration
statement under the Securities Act with respect to any securities of the Company or the
Operating Partnership owned or to be owned by such person or to require the Company or the
Operating Partnership to include such securities in any securities being registered pursuant
to any other registration statement filed by the Company or the Operating Partnership under
the Securities Act.
(t) The financial statements and schedules of the Company, including the notes thereto,
included or incorporated by reference in the Prospectus and the Registration Statement
present fairly in all material respects the financial condition, results of operations and
cash flows of the Company as of the dates and for the periods indicated, comply as to form
in all material respects with the applicable accounting requirements of the Securities Act
and have been prepared in conformity with generally accepted accounting principles applied
on a consistent basis throughout the periods involved (except as otherwise noted therein).
The summary financial data set forth under the captions “Selected Financial Data” and
“Capitalization” included or incorporated by reference in the Prospectus and Registration
Statement fairly present, on the basis stated therein, the information included therein.
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(u) No action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its Subsidiaries or its
or their property is pending or, to the best knowledge of the Company, threatened that (i)
could reasonably be expected to have a material adverse effect on the performance of this
Agreement or the consummation of any of the transactions contemplated hereby or (ii) could
reasonably be expected to have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and its Subsidiaries,
taken as a whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Prospectus (exclusive of any
supplement thereto).
(v) (i) The Company or its Subsidiaries have fee simple title or insurable leasehold
title to all of the properties described in the Disclosure Package and the Prospectus, and
any document that is incorporated by reference therein, as owned or leased by them and the
improvements (exclusive of improvements owned by tenants) located thereon (the “Properties”
and individually, a “Property”), in each case, free and clear of all liens, encumbrances,
claims, security interests, restrictions and defects, except those that are disclosed in the
Disclosure Package and the Prospectus or that do not materially and adversely affect the
value of such Property and do not materially and adversely interfere with the use made and
proposed to be made of such Property by the Company and any Subsidiary; (ii) except as
otherwise set forth in the Disclosure Package and the Prospectus, the mortgages and deeds of
trust encumbering the Properties described in the Disclosure Package and the Prospectus are
not convertible into debt or equity securities of the Company or the Operating Partnership
and such mortgages and deeds of trust are not cross-defaulted or cross-collateralized to any
property not owned directly or indirectly by the Company or its Subsidiaries; (iii) the
Company has provided true and complete copies of the mortgages and deeds of trust to the
Representatives, and neither the Company nor any of its Subsidiaries is in default under any
of the mortgages or deeds of trust, nor has an event occurred which with the delivery of
notice and passing of a cure period would become a default under any mortgage or deed of
trust; (iv) neither the Company nor any of its Subsidiaries has received from any
governmental authority any written notice of any condemnation of or zoning change affecting
the Properties or any part thereof, and none of the Company or any Subsidiary knows of any
such condemnation or zoning change which is threatened and which if consummated would
reasonably be expected to have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and its Subsidiaries,
taken as a whole, whether or not arising from transactions in the ordinary course of
business; (v) 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
Disclosure Package and the Prospectus and except for such failures to comply that would not
individually or in the aggregate reasonably be expected to materially affect the value of
such Property or interfere in any material respect with the use made and proposed to be made
of such Property by the Company or any Subsidiary; (vi) a Subsidiary holds a valid owner’s
policy of title insurance for each Property insuring such Subsidiary as the fee title owner
or the leasehold titleholder, and the Company and/or its Subsidiaries has the benefit of
such title insurance policies; (vii) true, correct
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and complete copies of the leases, exhibits, schedules or other documents that comprise
the leases described in the “Properties” section of the Disclosure Package and Prospectus,
and any document that is incorporated by reference therein, where the tenant has been
specifically identified have been provided to the Underwriters or their counsel; and (viii)
the Company has fully disclosed in the Disclosure Package and the Prospectus which
Properties are held by the Company under a ground lease; the Company has supplied true and
complete copies of the ground leases to the Representatives; and neither the Company nor any
of its Subsidiaries is in default under any ground lease, nor has an event occurred which
with delivery of notice and passing of a cure period would become a default under any ground
lease.
(w) Neither the Company nor any Subsidiary is in violation or default of (i) any
provision of its charter, bylaws or other organizational or governing documents, (ii) the
terms of any indenture, contract, lease, mortgage, deed of trust, note agreement, loan
agreement or other agreement, obligation, condition, covenant or instrument to which it is a
party or bound or to which its property is subject, except as otherwise set forth in the
Disclosure Package and the Prospectus, or (iii) any statute, law, rule, regulation,
judgment, order or decree of any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over the Company or such Subsidiary
or any of its properties, as applicable.
(x) Deloitte & Touche LLP, who have certified the Company’s financial statements and
supporting schedules included in the Prospectus, and any document that is incorporated by
reference therein, and delivered their reports with respect to the audited financial
statements and schedules included in the Prospectus, are independent registered public
accountants within the meaning of the Securities Act and the applicable published rules and
regulations thereunder.
(y) The Company and each of its Subsidiaries has filed all foreign, federal, state and
local tax returns that are required to be filed or has requested extensions thereof, except
in any case in which the failure so to file would not have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or properties of the
Company and its Subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in the Prospectus
(exclusive of any supplement thereto), and has paid all taxes required to be paid by it and
any other assessment, fine or penalty levied against it, to the extent that any of the
foregoing is due and payable, except for any such tax, assessment, fine or penalty that is
currently being contested in good faith or as would not have a material adverse effect on
the condition (financial or otherwise), prospects, earnings, business or properties of the
Company and its Subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in the Prospectus
(exclusive of any supplement thereto).
(z) No material labor problem or dispute with the employees of the Company or any of
its Subsidiaries exists or, to the Company’s knowledge, is threatened or imminent.
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(aa) The Company and each of its Subsidiaries are insured by insurers of recognized
financial responsibility against such losses and risks and in such amounts as are prudent
and customary in the businesses in which they are engaged; all policies of insurance and
fidelity or surety bonds insuring the Company or any of its Subsidiaries or their respective
businesses, assets, employees, officers and directors are in full force and effect; the
Company and its Subsidiaries are in compliance with the terms of such policies and
instruments in all material respects; and there are no claims by the Company or any of its
Subsidiaries under any such policy or instrument as to which any insurance company is
denying liability or defending under a reservation of rights clause; neither the Company nor
any such Subsidiary has been refused any insurance coverage sought or applied for; and
neither the Company nor any such Subsidiary has any reason to believe that it will not be
able to renew its existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its business at a
cost that would not have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and its Subsidiaries,
taken as a whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Prospectus (exclusive of any
supplement thereto).
(bb) No Subsidiary of the Company is currently prohibited, directly or indirectly, from
paying any dividends or distributions to the Company, from making any other distribution on
such Subsidiary’s capital stock or equity interests, from repaying to the Company any loans
or advances to such Subsidiary from the Company or from transferring any of such
Subsidiary’s property or assets to the Company or any other Subsidiary of the Company except
pursuant to the terms of any indebtedness set forth in or contemplated in the Prospectus
(exclusive of any supplement thereto).
(cc) The Company and its Subsidiaries possess all valid and current licenses,
certificates, permits and other authorizations issued by the appropriate federal or state
regulatory authorities necessary to conduct their respective businesses; and neither the
Company nor any such Subsidiary has received any written notice of proceedings relating to
the revocation or modification of any such certificate, authorization or permit which,
singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding,
would have a material adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its Subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus (exclusive of any supplement thereto).
(dd) The Company and each of its Subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management’s general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain asset accountability; (iii) access
to assets is permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with respect to any
differences. Except as disclosed in the Prospectus, since the date of
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the Company’s most recent audited balance sheet, there has been (i) no material
weakness in the Company’s internal control over financial reporting (whether or not
remediated) and (ii) no change in the Company’s internal control over financial reporting
that has materially and adversely affected, or is reasonably likely to materially and
adversely affect, the Company’s internal control over financial reporting.
(ee) The Company has not taken, directly or indirectly, any action designed to or that
would constitute or that would reasonably be expected to cause or result in, under the
Exchange Act or otherwise, stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
(ff) The Company and its Subsidiaries are (i) in compliance with any and all applicable
federal, state and local laws and regulations relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants or
contaminants (“Environmental Laws”), (ii) have received and are in compliance with all
permits, licenses or other approvals required of them under applicable Environmental Laws to
conduct their respective businesses and (iii) have not received notice of any actual or
potential liability under any Environmental Laws, except where such non-compliance with
Environmental Laws, failure to receive required permits, licenses or other approvals, or
liability would not, individually or in the aggregate, have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or properties of the
Company and its Subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in the Prospectus
(exclusive of any supplement thereto). Neither the Company nor any of the Subsidiaries has
been named as a “potentially responsible party” under the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended. Except as otherwise set
forth in the Prospectus, to the knowledge of the Company and the Operating Partnership,
there have been no and are no (i) aboveground or underground storage tanks; (ii)
polychlorinated biphenyls (“PCBs”) or PCB-containing equipment; (iii) asbestos or asbestos
containing materials; (iv) lead based paints; (v) mold or other airborne contaminants; or
(vi) dry-cleaning facilities in, on, under, or about any property owned by the Company, the
Operating Partnership or their Subsidiaries.
(gg) In the ordinary course of its business, the Company periodically reviews the
effect of Environmental Laws on the business, operations and properties of the Company and
its Subsidiaries, in the course of which it identifies and evaluates associated costs and
liabilities (including, without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with Environmental Laws, or any permit,
license or approval, any related constraints on operating activities and any potential
liabilities to third parties). On the basis of such review, the Company has reasonably
concluded that such associated costs and liabilities would not, singly or in the aggregate,
have a material adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its Subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus (exclusive of any supplement thereto).
11
(hh) The minimum funding standard under Section 302 of the Employee Retirement Income
Security Act of 1974, as amended, and the regulations and published interpretations
thereunder (“ERISA”) has been satisfied by each “pension plan” (within the meaning of
Section 3(2) of ERISA) which has been established or maintained by the Company or any of its
Subsidiaries, and each such plan which is intended to be qualified under Section 401 of the
Internal Revenue Code 1986, as amended (the “Code”) is so qualified and, to the knowledge of
the Company, no fact exists that would adversely affect such qualification. Neither the
Company nor any of its Subsidiaries maintains or is required to contribute to a “welfare
plan” (as defined in Section 3(1) of ERISA) which provides retiree or other post-employment
welfare benefits or insurance coverage (other than “continuation coverage” (as defined in
Section 602 of ERISA) or as otherwise required by applicable law). Each “employee benefit
plan” (within the meaning of Section 3(3) of ERISA) established or maintained by the Company
and/or one or more of its Subsidiaries is in compliance with the currently applicable
provisions of ERISA, except as would not reasonably be expected to have a material adverse
effect on the condition (financial or otherwise), prospects, earnings, business or
properties of the Company or its Subsidiary that sponsors such “employee benefit plan.”
(ii) There is and has been no failure on the part of the Company and any of the
Company’s directors or officers, in their capacities as such, to comply with any applicable
provision of the Sarbanes Oxley Act of 2002 and the rules and regulations promulgated in
connection therewith (the “Sarbanes Oxley Act”), including, without limitation, Section 402
related to loans.
(jj) Neither the Company nor any of its Subsidiaries nor, to the knowledge of the
Company, any director, officer, agent, employee or affiliate of the Company or any of its
Subsidiaries is aware of or has taken any action, directly or indirectly, that would result
in a violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and
the rules and regulations thereunder (“FCPA”), including, without limitation, making use of
the mails or any means or instrumentality of interstate commerce corruptly in furtherance of
an offer, payment, promise to pay or authorization of the payment of any money, or other
property, gift, promise to give, or authorization of the giving of anything of value to any
“foreign official” (as such term is defined in the FCPA) or any foreign political party or
official thereof or any candidate for foreign political office, in contravention of the FCPA
and the Company, its Subsidiaries and, to the knowledge of the Company and the Operating
Partnership, its affiliates have conducted their businesses in compliance with the FCPA and
have instituted and maintain policies and procedures designed to ensure, and which are
reasonably expected to continue to ensure, continued compliance therewith.
(kk) The operations of the Company and its Subsidiaries are and have been conducted at
all times in compliance with applicable financial recordkeeping and reporting requirements
of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money
laundering statutes of all jurisdictions, the rules and regulations thereunder and any
related or similar rules, regulations or guidelines, issued, administered or enforced by any
governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or
proceeding by or before any court or governmental agency,
12
authority or body or any arbitrator involving the Company or any of its Subsidiaries
with respect to the Money Laundering Laws is pending or, to the best knowledge of the
Company, threatened.
(ll) Neither the Company nor any of its Subsidiaries nor, to the knowledge of the
Company, any director, officer, agent, employee or affiliate of the Company or any of its
Subsidiaries is currently subject to any U.S. sanctions administered by the Office of
Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company will not
directly or indirectly use the proceeds of the offering, or lend, contribute or otherwise
make available such proceeds to any Subsidiary, joint venture partner or other person or
entity, for the purpose of financing the activities of any person currently subject to any
U.S. sanctions administered by OFAC.
(mm) The Company and its Subsidiaries have good and marketable title to all personal
property owned by them, free and clear of all encumbrances and defects; and all personal
property held under lease by the Company or any Subsidiary are held by it under valid,
subsisting and enforceable leases, in each case, with such exceptions as are not material
and do not interfere with the use made and proposed to be made of such property by the
Company or the Subsidiary.
(nn) There are no business relationships or related-party transactions involving the
Company or any Subsidiary or any other person required to be described in the Prospectus
which have not been described as required.
(oo) Except as disclosed in the Disclosure Package and the Prospectus, the Company (i)
does not have any material lending or other relationship with any bank or lending affiliate
of any Underwriter and (ii) does not intend to use any of the proceeds from the sale of the
Common Stock hereunder to repay any outstanding debt owed to any affiliate of any
Underwriter.
(pp) The statistical and market-related data included in the Disclosure Package and the
Prospectus and the Registration Statement are based on or derived from sources that the
Company believes to be reliable and accurate.
(qq) Commencing with its taxable year ended December 31, 2005, the Company has been
organized and operated in conformity with the requirements for qualification and taxation as
a real estate investment trust (a “REIT”) under the Code, and its proposed method of
operation will enable it to meet the requirements for qualification and taxation as a REIT
under the Code for the Company’s taxable years ending December 31, 2009 and thereafter.
Each of the Company’s corporate subsidiaries that has elected, together with the Company, to
be a taxable REIT subsidiary is in compliance with all requirements applicable to a “taxable
REIT subsidiary” within the meaning of Section 856(l) of the Code and all applicable
regulations under the Code, and the Company is not aware of any fact that would negatively
impact such qualification. Each of the Company’s corporate subsidiaries (or subsidiaries
taxable as corporations for United States federal income tax purposes) that is not a taxable
REIT subsidiary is a
13
“qualified REIT subsidiary” within the meaning of Section 856(i) of the Code and the
regulations thereunder.
(rr) The Company, the Operating Partnership and each of their Subsidiaries (including
any predecessor entities) have not distributed, and prior to the later of the Closing Date
and the completion of the distribution of the Underwritten Securities, will not distribute,
any offering material in connection with the offering or sale of the Underwritten Securities
other than the Registration Statement, the Prospectus or any other materials, if any,
permitted by the Securities Act.
(ss) Except as described in each of the Registration Statement and the Prospectus, as
of the date hereof, with respect to stock options (the “Stock Options”) granted pursuant to
the stock-based compensation plans of the Company and its Subsidiaries (the “Company Stock
Plans”), (i) each Stock Option designated by the Company at the time of grant as an
“incentive stock option” under Section 422 of the Code, so qualifies, (ii) each grant of a
Stock Option was duly authorized no later than the date on which the grant of such Stock
Option was by its terms to be effective (the “Grant Date”) by all necessary corporate
action, including, as applicable, approval by the board of directors of the Company (or a
duly constituted and authorized committee thereof) and any required stockholder approval by
the necessary number of votes or written consents, and the award agreement governing such
grant (if any) was duly executed and delivered by each party thereto, (iii) each such grant
was made in accordance with the terms of the Company Stock Plans, the Exchange Act and all
other applicable laws and regulatory rules or requirements, including the rules of the New
York Stock Exchange and any other exchange on which Company securities are traded, (iv) the
per share exercise price of each Stock Option was equal to or greater than the fair market
value of a share of Common Stock on the applicable Grant Date and (v) each such grant was
properly accounted for in accordance with GAAP in the financial statements (including the
related notes) of the Company and disclosed in the Company’s filings with the Commission in
accordance with the Exchange Act and all other applicable laws. The Company has not
knowingly granted, and there is no and has been no policy or practice of the Company of
granting, Stock Options prior to, or otherwise coordinating the grant of Stock Options with,
the release or other public announcement of material information regarding the Company or
its Subsidiaries or their results of operations or prospects.
Any certificate signed by any officer of the Company and delivered to the Representatives or
counsel for the Underwriters in connection with the offering of the Securities pursuant to this
Agreement shall be deemed a representation and warranty by the Company, as to matters covered
thereby, to each Underwriter.
2. Purchase and Sale
(a) Subject to the terms and conditions and in reliance
upon the representations and warranties herein set forth, the Company agrees to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to purchase from the
Company (i) at a purchase price of $3.3425 per share, the amount of the Underwritten
Securities set forth opposite such Underwriter’s name in Schedule I hereto and (ii) at a
purchase price of $3.50 per share, the amount of the Underwritten Securities set forth
14
opposite such Underwriter’s name in Schedule II hereto, such number of underwritten
securities allocated to the persons listed in Schedule II hereto.
(b) Subject to the terms and conditions and in reliance upon the representations and
warranties herein set forth, the Company hereby grants an option to the several Underwriters
to purchase, severally and not jointly, up to 3,000,000 Option Securities at the same
purchase price per share as the Underwriters shall pay for the Underwritten Securities.
Said option may be exercised in whole or in part at any time on or before the 30th day after
the date of the Prospectus upon written or telegraphic notice by the Representatives to the
Company setting forth the number of shares of the Option Securities as to which the several
Underwriters are exercising the option and the settlement date. The number of Option
Securities to be purchased by each Underwriter shall be the same percentage of the total
number of shares of the Option Securities to be purchased by the several Underwriters as
such Underwriter is purchasing of the Underwritten Securities, subject to such adjustments
as the Representatives in its absolute discretion shall make to eliminate any fractional
shares.
3. Delivery and Payment. Delivery of and payment for the Underwritten Securities and the
Option Securities (if the option provided for in Section 2(b) hereof shall have been exercised on
or before the third Business Day prior to the Closing Date) shall be made at 10:00 A.M., New York
City time, on June 1, 2009, or at such time on such later date not more than three Business Days
after the foregoing date as the Representatives shall designate, which date and time may be
postponed by agreement between the Representatives and the Company or as provided in Section 9
hereof (such date and time of delivery and payment for the Securities being herein called the
“Closing Date”). Delivery of the Securities shall be made to the Representatives for the
respective accounts of the several Underwriters against payment by the several Underwriters through
the Representatives of the purchase price thereof to or upon the order of the Company by wire
transfer payable in same-day funds to an account specified by the Company. Delivery of the
Underwritten Securities and the Option Securities shall be made through the facilities of The
Depository Trust Company unless the Representatives shall otherwise instruct.
If the option provided for in Section 2(b) hereof is exercised after the third Business Day
prior to the Closing Date, the Company will deliver the Option Securities (at the expense of the
Company) to the Representatives, at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, on the
date specified by the Representatives (which shall be within three Business Days after exercise of
said option) for the respective accounts of the several Underwriters, against payment by the
several Underwriters through the Representatives of the purchase price thereof to or upon the order
of the Company by wire transfer payable in same-day funds to an account specified by the Company.
If settlement for the Option Securities occurs after the Closing Date, the Company will deliver to
the Representatives on the settlement date for the Option Securities, and the obligation of the
Underwriters to purchase the Option Securities shall be conditioned upon receipt of, supplemental
opinions, certificates and letters confirming as of such date the opinions, certificates and
letters delivered on the Closing Date pursuant to Section 6 hereof.
4. Offering by the Underwriters. It is understood that the several Underwriters propose to
offer the Securities for sale to the public as set forth in the Prospectus.
15
5. Agreements. The Company and the Operating Partnership agree with the several
Underwriters that:
(a) The Company will use its best efforts to cause the Registration Statement, if not
effective at the Execution Time, and any amendment thereof, to become effective. Prior to
the termination of the offering of the Securities, the Company will not file any amendment
of the Registration Statement or supplement to the Prospectus or any Rule 462(b)
Registration Statement unless the Company has furnished the Representatives a copy for the
Representatives’ review prior to filing and will not file any such proposed amendment or
supplement to which the Representatives reasonably objects. Subject to the foregoing
sentence, if the Registration Statement has become or becomes effective pursuant to Rule
430B, or filing of the Prospectus is otherwise required under Rule 424(b), the Company will
cause the Prospectus, properly completed, and any supplement thereto to be filed in a form
approved by the Representatives with the Commission pursuant to the applicable paragraph of
Rule 424(b) within the time period prescribed and will provide evidence satisfactory to the
Representatives of such timely filing. The Company will promptly advise the Representatives
(1) when the Registration Statement, if not effective at the Execution Time, shall have
become effective, (2) when the Prospectus, and any supplement thereto, shall have been filed
(if required) with the Commission pursuant to Rule 424(b) or when any Rule 462(b)
Registration Statement shall have been filed with the Commission, (3) when, prior to
termination of the offering of the Securities, any amendment to the Registration Statement
shall have been filed or become effective, (4) of any request by the Commission or its staff
for any amendment of the Registration Statement, or any Rule 462(b) Registration Statement,
or for any supplement to the Prospectus or for any additional information, (5) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any proceeding for that purpose
and (6) of the receipt by the Company of any notification with respect to the suspension of
the qualification of the Securities for sale in any jurisdiction or the institution or
threatening of any proceeding for such purpose. The Company will use its best efforts to
prevent the issuance of any such stop order or the suspension of any such qualification and,
if issued, to obtain as soon as possible the withdrawal thereof.
(b) If, at any time prior to the filing of the Prospectus pursuant to Rule 424(b), any
event occurs as a result of which the Disclosure Package would include any untrue statement
of a material fact or omit to state any material fact necessary to make the statements
therein in the light of the circumstances under which they were made at such time not
misleading, the Company will (i) notify promptly the Representatives so that any use of the
Disclosure Package may cease until it is amended or supplemented; (ii) amend or supplement
the Disclosure Package to correct such statement or omission; and (iii)
supply any amendment or supplement to the Representatives in such quantities as the
Representatives may reasonably request.
(c) If, at any time when a prospectus relating to the Securities is required to be
delivered under the Securities Act, any event occurs as a result of which the Prospectus as
then supplemented would include any untrue statement of a material fact or omit to state
16
any
material fact necessary to make the statements therein in the light of the circumstances
under which they were made not misleading, or if it shall be necessary to amend the
Registration Statement or supplement the Prospectus to comply with the Securities Act or the
rules thereunder, the Company promptly will (1) notify the Representatives of any such
event, (2) subject to the second sentence of paragraph (a) of this Section 5, prepare an
amendment or supplement that will correct such statement or omission or effect such
compliance and (3) supply any supplemented Prospectus to the Representatives and counsel to
the Representatives in such quantities as they may reasonably request.
(d) The Company represents that it has not made, and agrees that, unless it obtains the
prior written consent of the Representatives, which consent will not be unreasonably
withheld, it will not make, any offer relating to the Securities that constitutes or would
constitute an Issuer Free Writing Prospectus or that otherwise constitutes or would
constitute a “free writing prospectus” (as defined in Rule 405 of the Securities Act) or a
portion thereof required to be filed by the Company with the Commission or retained by the
Company under Rule 433 of the Securities Act; provided that the prior written consent of the
Representatives hereto shall be deemed to have been given in respect of the Free Writing
Prospectuses included in Schedule III hereto and any electronic road show. Any such free
writing prospectus consented to by the Representatives is hereinafter referred to as a
“Permitted Free Writing Prospectus.” The Company agrees that (i) it has treated and will
treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing
Prospectus, and (ii) has complied and will comply, as the case may be, with the requirements
of Rules 164 and 433 of the Securities Act applicable to any Permitted Free Writing
Prospectus, including in respect of timely filing with the Commission, legending and record
keeping.
(e) The Company will use its best efforts to list, subject to notice of issuance, the
Securities on the New York Stock Exchange.
(f) As soon as practicable, the Company will make generally available to its security
holders and to the Representatives an earnings statement or statements of the Company and
its Subsidiaries which will satisfy the provisions of Section 11(a) of the Securities Act
and Rule 158 under the Securities Act.
(g) The Company shall not invest, or otherwise use the proceeds received by the Company
from its sale of the Securities in such a manner as would require the Company or any of its
Subsidiaries to register as an investment company under the Investment Company Act.
(h) During the time when a prospectus relating to the Securities is required to be
delivered under the Securities Act the Company shall file, on a timely basis, with the
Commission and the New York Stock Exchange all reports and documents required to be filed
under the Exchange Act. Additionally, the Company shall report the use of proceeds from the
issuance of the Securities as may be required under Rule 463 under the Securities Act.
17
(i) The Company will furnish to the Representatives and counsel for the Underwriters
signed copies of the Registration Statement (including exhibits thereto) and to each other
Underwriter a copy of the Registration Statement (without exhibits thereto) and, so long as
delivery of a prospectus by an Underwriter or dealer may be required by the Securities Act,
as many copies of each Preliminary Prospectus, the Prospectus and each Issuer Free Writing
Prospectus and any supplement thereto as the Representatives may reasonably request.
(j) The Company will arrange, if necessary, for the qualification of the Securities for
sale under the laws of such jurisdictions as the Representatives may designate, and will
maintain such qualifications in effect so long as required for the distribution of the
Securities; provided that in no event shall the Company be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take any action that
would subject it to service of process in suits, other than those arising out of the
offering or sale of the Securities, in any jurisdiction where it is not now so subject.
(k) The Company will not, without the prior written consent of the Representatives, for
a period of 60 days after the date of this Agreement, offer, sell, contract to sell, pledge,
or otherwise dispose of, (or enter into any transaction which is designed to, or would
reasonably be expected to, result in the disposition (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise) by the Company or any
affiliate of the Company or any person in privity with the Company) directly or indirectly,
including the filing (or participation in the filing) of a registration statement (except
for amendments or supplements to the registration statement on Form S-8 relating to the 2005
Equity Incentive Plan, registration statements on Form S-3 (File Nos. 333-139706 and
333-151496) relating to the sale of common stock from time to time by the selling
stockholders specified therein and any amendments or supplements thereto, or a registration
statement on Form S-4 relating to the acquisition of real property, another real property
company or a property management company) with the Commission in respect of, or establish or
increase a put equivalent position or liquidate or decrease a call equivalent position
within the meaning of Section 16 of the Exchange Act, with respect to, any other shares of
Common Stock or any securities convertible into, or exercisable, or exchangeable for, shares
of Common Stock, or publicly disclose an intention to effect any such transaction,
provided, however, that the Company may (i) grant stock options, restricted
stock or long-term incentive units to employees, consultants or directors pursuant to the
terms of a plan in effect at the Execution Time, (ii) issue Common Stock pursuant to: (A)
the exercise of such options; (B) the redemption of Units issued upon conversion of such
long-term incentive plan units; (C) the exercise of any employee stock options outstanding
at the Execution Time; (D) the redemption of Units issued upon conversion of long-term
incentive plan units
outstanding at the Execution Time; (E) the redemption of any Units outstanding at the
Execution Time, (iii) issue Common Stock pursuant to the Company’s dividend reinvestment
plan (if any), and (iv) issue Common Stock or securities convertible into or exchangeable or
exercisable for shares of Common Stock in connection with acquisitions of real property,
real property companies or property management companies.
18
Notwithstanding the foregoing, if: (x) during the last 17 days of the 60-day lock-up
period the Company issues an earnings release or material news or a material event relating
to the Company occurs; or (y) prior to the expiration of the 60-day lock-up period, the
Company announces that it will release earnings results during the 16-day period beginning
on the last day of the 60-day lock-up period, the restrictions described above shall
continue to apply until the expiration of the 18-day period beginning on the date of the
issuance of the earnings release or the occurrence of the material news or material event.
(l) The Company will comply in all material respects with all applicable securities and
other applicable laws, rules and regulations, including, without limitation, the Sarbanes
Oxley Act, and will use its best efforts to cause the Company’s directors and officers, in
their capacities as such, to comply with such laws, rules and regulations, including,
without limitation, the provisions of the Sarbanes Oxley Act, except where the failure to
comply or to cause the Company’s directors and officers to comply with such laws would not
reasonably be expected to have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and its Subsidiaries
taken as a whole.
(m) Neither the Company nor the Operating Partnership will take, directly or
indirectly, any action designed to or that would constitute or that might reasonably be
expected to cause or result in, under the Exchange Act or otherwise, stabilization or
manipulation of the price of any security of the Company or the Operating Partnership to
facilitate the sale or resale of the Securities.
(n) The Company agrees to pay the costs and expenses relating to the following matters:
(i) the preparation, printing or reproduction and filing with the Commission of the
Registration Statement (including financial statements and exhibits thereto), each
Preliminary Prospectus, the Prospectus and each Issuer Free Writing Prospectus, and each
amendment or supplement to any of them; (ii) the printing (or reproduction) and delivery
(including postage, air freight charges and charges for counting and packaging) of such
copies of the Registration Statement, each Preliminary Prospectus, the Prospectus and each
Issuer Free Writing Prospectus, and all amendments or supplements to any of them, as may, in
each case, be reasonably requested for use in connection with the offering and sale of the
Securities; (iii) the preparation, printing, authentication, issuance and delivery of
certificates for the Securities, including any stamp or transfer taxes in connection with
the original issuance and sale of the Securities; (iv) the printing (or reproduction) and
delivery of this Agreement, any blue sky memorandum and all other agreements or documents
printed (or reproduced) and delivered in connection with the offering of the Securities; (v)
the listing of the Securities on the New York Stock Exchange; (vi) any registration or
qualification of the Securities
for offer and sale under the securities or blue sky laws of the several states
(including filing fees and the reasonable fees and expenses of counsel for the Underwriters
relating to such registration and qualification); (vii) any filings required to be made with
the Financial Industry Regulatory Authority (“FINRA”) (including filing fees and the
reasonable fees and expenses of counsel for the Underwriters relating to such filings);
(viii) the fees and expenses of the Company’s accountants and the fees and expenses of
19
counsel (including local and special counsel) for the Company; and (ix) all other costs and
expenses incident to the performance by the Company of its obligations hereunder.
(o) The Company and the Operating Partnership will use the net proceeds received by the
Company from the sale of the Securities in the manner specified in the Prospectus under the
caption “Use of Proceeds.”
(p) The Company will use its best efforts to meet the requirements to qualify, for the
taxable year ending December 31, 2009, for taxation as a REIT under the Code.
6. Conditions to the Obligations of the Underwriters. The obligations of the Underwriters
to purchase the Underwritten Securities and the Option Securities, as the case may be, shall be
subject to the accuracy of the representations and warranties on the part of the Company and the
Operating Partnership contained herein as of the Execution Time, the Closing Date and any
settlement date pursuant to Section 3 hereof, to the accuracy of the statements of the Company and
the Operating Partnership made in any certificates pursuant to the provisions hereof, to the
performance by the Company and the Operating Partnership of their obligations hereunder and to the
following additional conditions:
(a) If filing of the Prospectus, or any supplement thereto, is required pursuant to
Rule 424(b), the Prospectus, and any such supplement, will be filed in the manner and within
the time period required by Rule 424(b); and no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceedings for that purpose shall
have been instituted or threatened.
(b) The Company shall have requested and caused ▇▇▇▇▇▇▇▇ Chance US LLP, counsel for the
Company, to have furnished to the Representatives their opinion, dated the Closing Date and
addressed to the Representatives, in the form attached hereto as Exhibit A.
(c) The Company shall have requested and caused ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC, local counsel
for the Company, to have furnished to the Representatives their opinion, dated the Closing
Date and addressed to the Representatives, in the form attached hereto as Exhibit B.
(d) The Company shall have requested and caused ▇▇▇▇▇▇▇▇ Chance US LLP, tax counsel for
the Company, to have furnished to the Representatives their opinion, dated the Closing Date
and addressed to the Representatives, in the form attached hereto as Exhibit C.
(e) The Company shall have requested and caused ▇▇▇▇▇▇▇ LLP, Maryland counsel for the
Company, to have furnished to the Representatives their opinion, dated the Closing Date and
addressed to the Representatives, in the form attached hereto as Exhibit D.
(f) The Representatives shall have received from ▇▇▇▇▇▇▇ Procter LLP, counsel for the
Underwriters, such opinion or opinions, dated the Closing Date and addressed to the
Representatives, with respect to such matters as the Representatives may
20
reasonably require,
and the Company shall have furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.
(g) The Company shall have furnished to the Representatives a certificate of the
Company, signed by the Chairman of the Board or the President and the principal financial or
accounting officer of the Company, on behalf of the Company and as the indirect general
partner of the Operating Partnership, dated the Closing Date, to the effect that the signers
of such certificate have examined the Registration Statement, the Prospectus, any
supplements to the Prospectus, the Disclosure Package and this Agreement and that:
(i) the representations and warranties of the Company and the Operating Partnership in
this Agreement are true and correct on and as of the Closing Date with the same effect as if
made on the Closing Date and the Company and the Operating Partnership have complied with
all the agreements and satisfied all the conditions on their part to be performed or
satisfied at or prior to the Closing Date;
(ii) the Registration Statement has become effective under the Securities Act and no
stop order suspending the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or, to the Company’s knowledge,
threatened; and
(iii) since the date of the most recent financial statements included in the
Prospectus, and any document that is incorporated by reference therein, there has been no
material adverse effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company and its Subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as set forth in or
contemplated in the Disclosure Package and the Prospectus (exclusive of any supplement
thereto).
(h) The Company shall have requested and caused Deloitte & Touche LLP to have furnished
to the Representatives, at the Execution Time and at the Closing Date, a letter, dated as of
the Execution Time and as of the Closing Date, in form and substance satisfactory to the
Representatives, confirming that they are independent registered public accountants within
the meaning of the Securities Act and the applicable rules and regulations adopted by the
Commission thereunder and stating in effect that:
(i) in their opinion the audited financial statements, financial statement schedules
and pro forma financial statements included or incorporated by
reference in the Registration Statement and the Prospectus and reported on by them
comply as to form in all material respects with the applicable accounting requirements of
the Securities Act and the Exchange Act and the related rules and regulations adopted by the
Commission;
(ii) on the basis of a reading of the latest unaudited financial statements made
available by the Company and its Subsidiaries; their limited review, in accordance with
standards established under Statement on Auditing Standards No. 100,
21
of the unaudited
interim financial information for the three-month periods ended
March 31, 2008 and 2009, and as at March 31, 2009, included or incorporated by
reference in the Registration Statement and the Prospectus; carrying out certain specified
procedures (but not an examination in accordance with generally accepted auditing standards)
which would not necessarily reveal matters of significance with respect to the comments set
forth in such letter; a reading of the minutes of the meetings of the stockholders,
directors and committees of the Company and the Subsidiaries; and inquiries of certain
officials of the Company who have responsibility for financial and accounting matters of the
Company and its Subsidiaries as to transactions and events subsequent to December 31, 2008,
nothing came to their attention which caused them to believe that:
| (A) | any unaudited financial statements included or incorporated by reference in the Registration Statement and the Prospectus do not comply as to form in all material respects with applicable accounting requirements of the Securities Act and with the related rules and regulations adopted by the Commission with respect to financial statements included or incorporated by reference in quarterly reports on Form 10-Q under the Exchange Act; and said unaudited financial statements are not in conformity with generally accepted accounting principles applied on a basis substantially consistent with that of the audited financial statements included or incorporated by reference in the Registration Statement and the Prospectus; | ||
| (B) | with respect to the period subsequent to March 31, 2009, there were any increases, at a specified date not more than five days prior to the date of the letter, in the term loan, revolving credit facility and mortgage notes payable of the Company and its Subsidiaries or capital stock of the Company or decreases in the stockholders’ equity of the Company as compared with the amounts shown on the March 31, 2009 consolidated balance sheet included or incorporated by reference in the Registration Statement and the Prospectus, or for the period from April 1, 2009 to such specified date there were any decreases, as compared the corresponding period in the preceding year in revenues or increase in net loss of the Company and its Subsidiaries, except in all instances for changes or decreases set forth in such letter, in which case the letter shall be accompanied by an explanation by the Company as to the significance thereof unless said explanation is not deemed necessary by the Representatives; and | ||
| (C) | the information included or incorporated by reference in the Registration Statement and the Prospectus in response to |
22
| Regulation S-K, Item 301 (Selected Financial Data), Item 302 (Supplementary Financial Information) and Item 402 (Executive Compensation) is not in conformity with the applicable disclosure requirements of Regulation S-K. |
(iii) they have performed certain other specified procedures as a result of which they
determined that certain information of an accounting, financial or statistical nature (which
is limited to accounting, financial or statistical information derived from the general
accounting records of the Company and its Subsidiaries) set forth or incorporated by
reference in the Registration Statement and the Prospectus and in Exhibit 12 to the
Company’s Annual Report on Form 10-K, the information included or incorporated by reference
in Items 1, 1A, 2, 5, 6, 7, 7A, 9A, 11 and 12 of the Company’s Annual Report on Form 10-K,
incorporated by reference in the Registration Statement and the Prospectus, the information
under the captions “Management’s Discussion and Analysis of Financial Condition and Results
of Operations,” “Quantitative and Qualitative Disclosure About Market Risk” and
“Unregistered Sales of Equity Securities and Use of Proceeds” included or incorporated by
reference in the Company’s Quarterly Reports on Form 10-Q, incorporated by reference in the
Registration Statement and the Prospectus, and any information appearing in a Current Report
on Form 8-K incorporated by reference in the Registration Statement and the Prospectus
agrees with the accounting records of the Company and its Subsidiaries, excluding any
questions of legal interpretation.
(iv) on the basis of a reading of the unaudited pro forma financial statements
incorporated by reference in the Registration Statement, and incorporated by reference in
the Disclosure Package and the Prospectus (the “pro forma financial statements”); carrying
out certain specified procedures; inquiries of certain officials of the Company who have
responsibility for financial and accounting matters; and proving the arithmetic accuracy of
the application of the pro forma adjustments to the historical amounts in the pro forma
financial statements, nothing came to their attention which caused them to believe that the
pro forma financial statements do not comply as to form in all material respects with the
applicable accounting 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
such statements.
References to the Prospectus in this paragraph (h) include any supplement thereto at
the date of the letter.
(i) Subsequent to the Execution Time or, if earlier, the dates as of which information
is given or incorporated by reference in the Registration Statement (exclusive of any
amendment thereof) and the Prospectus (exclusive of any supplement thereto), there shall not
have been (i) any change or decrease specified in the letter or letters referred to in
paragraph (h) of this Section 6 or (ii) any change, or any development involving a
prospective change, in or affecting the condition (financial or otherwise), earnings,
business or properties of the Company and its Subsidiaries taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as set forth in or
contemplated in the Prospectus (exclusive of any supplement thereto) the
23
effect of which, in
any case referred to in clause (i) or (ii) above, is, in the sole judgment of the
Representatives, so material and adverse as to make it impractical or inadvisable to proceed
with the offering or delivery of the Securities as contemplated by the Registration
Statement (exclusive of any amendment thereof) and the Prospectus (exclusive of any
supplement thereto).
(j) Prior to the Closing Date, the Company shall have furnished to the Representatives
such further information, certificates and documents as the Representatives may reasonably
request.
(k) Prior to the Execution Time, there shall not have been any decrease in the rating
of any of the Company’s debt securities by any “nationally recognized statistical rating
organization” (as defined for purposes of Rule 436(g) under the Securities Act) or any
notice given of any intended or potential decrease in any such rating or of a possible
change in any such rating that does not indicate the direction of the possible change.
(l) The Securities shall have been listed and admitted and authorized for trading on
the New York Stock Exchange, and satisfactory evidence of such actions shall have been
provided to the Representatives.
(m) The FINRA, upon review of the terms of the public offering of the Securities, shall
not have objected to such offering, such terms or the Underwriters’ participation in same.
(n) The Company shall have furnished to the Representatives a letter in the form of
Exhibit E hereto from each director and executive officer of the Company named in
the Registration Statement and the Prospectus.
If any of the conditions specified in this Section 6 shall not have been fulfilled when and as
provided in this Agreement, or if any of the opinions and certificates mentioned above or elsewhere
in this Agreement shall not be reasonably satisfactory in form and substance to the Representatives
and counsel for the Underwriters, this Agreement and all obligations of the Underwriters hereunder
may be canceled at, or at any time prior to, the Closing Date by the Representatives. Notice of
such cancellation shall be given to the Company in writing or by telephone or facsimile confirmed
in writing.
The documents required to be delivered by this Section 6 shall be delivered at the office of
▇▇▇▇▇▇▇▇ Chance US LLP, counsel for the Company, at ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇
▇▇▇▇▇-▇▇▇▇, on the Closing Date.
7. Reimbursement of Underwriters’ Expenses. If the sale of the Securities provided for
herein is not consummated because any condition to the obligations of the Underwriters set forth in
Section 6 hereof is not satisfied, because of any termination pursuant to Section 9 or Section 10
hereof or because of any refusal, inability or failure on the part of the Company or the Operating
Partnership to perform any agreement herein or comply with any provision hereof other than by
reason of a default by any of the Underwriters, the Company will reimburse the Underwriters
severally through Citigroup Global Markets Inc. on demand for all out-of-pocket
24
expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred by them in connection
with the proposed purchase and sale of the Securities.
8. Indemnification and Contribution.
(a) The Company and the Operating Partnership, jointly and severally, agree to
indemnify and hold harmless each Underwriter, the directors, officers, employees and agents
of each Underwriter and each person who controls any Underwriter within the meaning of
either the Securities Act or the Exchange Act against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them may become subject under the
Securities Act, the Exchange Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement for the registration of
the Securities as originally filed or in any amendment thereof, or in any Preliminary
Prospectus the Prospectus, or any Issuer Free Writing Prospectus or in any amendment thereof
or supplement thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company and the Operating Partnership will not
be liable in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Underwriter through the
Representatives specifically for inclusion therein. This indemnity agreement will be in
addition to any liability which the Company and the Operating Partnership may otherwise
have.
(b) Each Underwriter severally and not jointly agrees to indemnify and hold harmless
the Company and the Operating Partnership, each of the Company’s directors,
each of the Company’s officers who signs the Registration Statement, and each person
who controls the Company and the Operating Partnership within the meaning of either the
Securities Act or the Exchange Act, to the same extent as the foregoing indemnity from the
Company and the Operating Partnership to each Underwriter, but only with reference to
written information relating to such Underwriter furnished to the Company by or on behalf of
such Underwriter through the Representatives specifically for inclusion in the documents
referred to in the foregoing indemnity. This indemnity agreement will be in addition to any
liability which any Underwriter may otherwise have. The Company and the Operating
Partnership acknowledge that the statements set forth in (i) the last sentence of the last
paragraph of the cover page regarding delivery of the Securities, (ii) the list of
Underwriters and their respective participation in the sale of the Securities under the
caption “Underwriting” and (iii) the seven bullet-points in the twelfth paragraph under the
caption “Underwriting” related to stabilization activities in any Preliminary Prospectus,
the Prospectus and any Issuer Free Writing Prospectus constitute the only information
furnished in writing by or on behalf of the several Underwriters for
25
inclusion in any
Preliminary Prospectus, the Prospectus and any Issuer Free Writing Prospectus.
(c) Promptly after receipt by an indemnified party under this Section 8 of notice of
the commencement of any action, such indemnified party will, if a claim in respect thereof
is to be made against the indemnifying party under this Section 8, notify the indemnifying
party in writing of the commencement thereof; but the failure so to notify the indemnifying
party (i) will not relieve it from liability under paragraph (a) or (b) above unless and to
the extent it did not otherwise learn of such action and such failure results in the
forfeiture by the indemnifying party of substantial rights and defenses and (ii) will not,
in any event, relieve the indemnifying party from any obligations to any indemnified party
other than the indemnification obligation provided in paragraph (a) or (b) above. The
indemnifying party shall be entitled to appoint counsel of the indemnifying party’s choice
at the indemnifying party’s expense to represent the indemnified party in any action for
which indemnification is sought (in which case the indemnifying party shall not thereafter
be responsible for the fees and expenses of any separate counsel retained by the indemnified
party or parties except as set forth below); provided, however, that such
counsel shall be satisfactory to the indemnified party. Notwithstanding the indemnifying
party’s election to appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel (including local counsel),
and the indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to represent the
indemnified party would present such counsel with a conflict of interest, (ii) the actual or
potential defendants in, or targets of, any such action include both the indemnified party
and the indemnifying party and the indemnified party shall have reasonably concluded that
there may be legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of the institution of
such action or (iv) the indemnifying party shall authorize the indemnified party to employ
separate counsel at the expense of the indemnifying party. An indemnifying party will not,
without the prior
written consent of the indemnified parties, settle or compromise or consent to the
entry of any judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such claim or
action) unless such settlement, compromise or consent (A) includes an unconditional release
of each indemnified party from all liability arising out of such claim, action, suit or
proceeding and (B) does not include a statement as to, or an admission of, fault,
culpability or a failure to act by or on behalf of an indemnified party.
(d) In the event that the indemnity provided in paragraph (a) or (b) of this Section 8
is unavailable to or insufficient to hold harmless an indemnified party for any reason, the
Company, the Operating Partnership and the Underwriters severally agree to contribute to the
aggregate losses, claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same) (collectively
“Losses”) to which the Company, the Operating Partnership and one or
26
more of the
Underwriters may be subject in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and by the Underwriters on the other from
the offering of the Securities; provided, however, that in no case shall any
Underwriter (except as may be provided in any agreement among underwriters relating to the
offering of the Securities) be responsible for any amount in excess of the underwriting
discount or commission applicable to the Securities purchased by such Underwriter hereunder.
If the allocation provided by the immediately preceding sentence is unavailable for any
reason, the Company, the Operating Partnership and the Underwriters severally shall
contribute in such proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the Company and the Operating Partnership on the one hand and
of the Underwriters on the other in connection with the statements or omissions which
resulted in such Losses as well as any other relevant equitable considerations. Benefits
received by the Company and the Operating Partnership shall be deemed to be equal to the
total net proceeds from the offering (before deducting expenses) received by it, and
benefits received by the Underwriters shall be deemed to be equal to the total underwriting
discounts and commissions, in each case as set forth on the cover page of the Prospectus.
Relative fault shall be determined by reference to, among other things, whether any untrue
or any alleged untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information provided by the Company or by the Operating
Partnership on the one hand or the Underwriters on the other, the intent of the parties and
their relative knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Company, the Operating Partnership and the Underwriters
agree that it would not be just and equitable if contribution were determined by pro rata
allocation or any other method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this paragraph (d), no
person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person who controls an
Underwriter within the meaning of either the Securities Act or the Exchange Act and each
director, officer, employee and agent of an Underwriter shall have the same rights to
contribution as such Underwriter, and each person who controls the Company or
the Operating Partnership within the meaning of either the Securities Act or the
Exchange Act, each officer of the Company who shall have signed the Registration Statement
and director of the Company shall have the same rights to contribution as the Company and
the Operating Partnership, subject in each case to the applicable terms and conditions of
this paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters shall fail to purchase and
pay for any of the Securities agreed to be purchased by such Underwriter or Underwriters hereunder
and such failure to purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Underwriters shall be obligated severally to take
up and pay for (in the respective proportions which the amount of Securities set forth opposite
their names in Schedule I hereto bears to the aggregate amount of Securities set forth opposite the
names of all the remaining Underwriters) the Securities which the defaulting Underwriter or
Underwriters agreed but failed to purchase; provided, however, that in the event
that the aggregate amount of Securities which the defaulting Underwriter or Underwriters agreed
27
but failed to purchase shall exceed 10% of the aggregate amount of Securities set forth in Schedule I
hereto, the remaining Underwriters shall have the right to purchase all, but shall not be under any
obligation to purchase any, of the Securities, and if such nondefaulting Underwriters do not
purchase all the Securities, this Agreement will terminate without liability to any nondefaulting
Underwriter, the Company or the Operating Partnership. In the event of a default by any
Underwriter as set forth in this Section 9, the Closing Date shall be postponed for such period,
not exceeding five Business Days, as the Representatives shall determine in order that the required
changes in the Registration Statement and the Prospectus or in any other documents or arrangements
may be effected. Nothing contained in this Agreement shall relieve any defaulting Underwriter of
its liability, if any, to the Company and any nondefaulting Underwriter for damages occasioned by
its default hereunder.
10. Termination. This Agreement shall be subject to termination in the absolute discretion
of the Representatives, by notice given to the Company prior to delivery of and payment for the
Securities, if at any time prior to such time (i) trading in the Company’s Common Stock shall have
been suspended by the Commission or the New York Stock Exchange or trading in securities generally
on the New York Stock Exchange shall have been suspended or limited or minimum prices shall have
been established on such Exchange, (ii) a banking moratorium shall have been declared either by
Federal or New York State authorities or (iii) there shall have occurred any outbreak or escalation
of hostilities, declaration by the United States of a national emergency or war, or other calamity
or crisis the effect of which on financial markets is such as to make it, in the sole judgment of
the Representatives, impractical or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by the Prospectus (exclusive of any supplement thereto).
11. No Advisor of Fiduciary Relationship The Company acknowledges and agrees that: (i) the purchase and sale of the Securities pursuant
to this Agreement, including the determination of the public offering price of the Securities and
any related discounts and commissions, is an arm’s-length commercial transaction between the
Company, on the one hand, and the several Underwriters, on the other hand, and the Company is
capable of evaluating and understanding and understands and accepts the terms, risks and conditions
of the transactions contemplated by this Agreement; (ii) in connection with each transaction
contemplated hereby and the process leading to such transaction each Underwriter is and has been
acting solely as a principal and is not the financial advisor, agent or fiduciary of the Company or
its affiliates, stockholders, creditors or employees or any other party; (iii) no Underwriter has
assumed or will assume an advisory, agency or fiduciary responsibility in favor of the Company with
respect to any of the transactions contemplated hereby or the process leading thereto (irrespective
of whether such Underwriter has advised or is currently advising the Company on other matters) and
no Underwriter has any obligation to the Company with respect to the offering contemplated hereby
except the obligations expressly set forth in this Agreement; (iv) the several Underwriters and
their respective affiliates may be engaged in a broad range of transactions that involve interests
that differ from those of the Company and that the several Underwriters have no obligation to
disclose any of such interests by virtue of any advisory, agency or fiduciary relationship; and (v)
the Underwriters have not provided any legal, accounting, regulatory or tax advice with respect to
the offering contemplated hereby and the Company has consulted its own legal, accounting,
regulatory and tax advisors to the extent it deemed appropriate.
28
This Agreement supersedes all prior agreements and understandings (whether written or oral)
between the Company and the several Underwriters, or any of them, with respect to the subject
matter hereof. The Company hereby waives and releases, to the fullest extent permitted by law, any
claims that the Company may have against the several Underwriters with respect to any breach or
alleged breach of agency or fiduciary duty.
12. Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company, the Operating
Partnership or the officers of the Company and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any investigation made by or on
behalf of any Underwriter or the Company, the Operating Partnership or any of the officers,
directors, employees, agents or controlling persons referred to in Section 8 hereof, and will
survive delivery of and payment for the Securities. The provisions of Sections 7 and 8 hereof
shall survive the termination or cancellation of this Agreement.
13. Notices. All communications hereunder will be in writing and effective only on receipt,
and, if sent to the Representatives, will be mailed, delivered or telefaxed to Citigroup Global
Markets Inc. General Counsel (fax no.: (▇▇▇) ▇▇▇-▇▇▇▇), and confirmed to General Counsel, Citigroup
Global Markets Inc. at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: General Counsel, will
be mailed, delivered or telefaxed to KeyBanc Capital Markets Inc., Attention: Equity Capital
Markets (fax no.: (▇▇▇) ▇▇▇-▇▇▇▇), and confirmed to KeyBanc Capital Markets Inc. at ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: Equity Capital Markets, with a copy to
▇▇▇▇▇▇▇ Procter LLP, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇ (fax no.: (▇▇▇) ▇▇▇-▇▇▇▇) and confirmed to ▇▇▇▇▇▇▇
Procter LLP at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇; or, if
sent to the Company or the Operating Partnership, will be mailed, delivered or telefaxed to ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ Inc., Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (fax no.: (▇▇▇) ▇▇▇-▇▇▇▇) and confirmed to ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ Inc. at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, with a copy to ▇▇▇▇▇▇▇▇ Chance US LLP, Attention: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
(fax no.: (▇▇▇) ▇▇▇-▇▇▇▇) and confirmed to ▇▇▇▇▇▇▇▇ Chance US LLP at ▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇.
▇▇. Successors. This Agreement will inure to the benefit of and be binding upon the
parties hereto and their respective successors and the officers, directors, employees, agents and
controlling persons referred to in Section 8 hereof, and no other person will have any right or
obligation hereunder.
15. Applicable Law. This Agreement will be governed by and construed in accordance with
the laws of the State of New York applicable to contracts made and to be performed within the State
of New York.
16. Partial Enforceability. The invalidity or unenforceability of any Section,
paragraph or provision of this Agreement shall not affect the validity or enforceability of any
other Section, paragraph or provision hereof. If any Section, paragraph or provision of this
Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be
made such minor changes (and only such minor changes) as are necessary to make it valid and
enforceable.
29
17. Counterparts. This Agreement may be signed in one or more counterparts, each of which
shall constitute an original and all of which together shall constitute one and the same agreement.
18. Headings. The section headings used herein are for convenience only and shall not
affect the construction hereof.
19. Definitions. The terms which follow, when used in this Agreement, shall have the
meanings indicated.
“Business Day” shall mean any day other than a Saturday, a Sunday or a legal holiday or
a day on which banking institutions or trust companies are authorized or obligated by law to
close in New York City.
“Commission” shall mean the Securities and Exchange Commission.
“Disclosure Package” shall mean (i) the Base Prospectus, if any, as amended or
supplemented, (ii) the Issuer Free Writing Prospectuses, if any, identified in Schedule III
hereto, (iii) any other free writing prospectus that the parties hereto shall hereafter
expressly agree in writing to treat as part of the Disclosure Package and (iv) a schedule
indicating the number of Securities being sold and the price at which the Securities will be
sold to the public.
“Effective Date” shall mean each date and time that the Registration Statement, any
post-effective amendment or amendments thereto and any Rule 462(b) Registration Statement
became or become effective.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission promulgated thereunder.
“Execution Time” shall mean the date and time that this Agreement is executed and
delivered by the parties hereto.
“Free Writing Prospectus” shall mean a free writing prospectus, as defined in Rule 405.
“Issuer Free Writing Prospectus” shall mean an issuer free writing prospectus, as
defined in Rule 433.
“Rule 424”, “Rule 430B” and “Rule 462” refer to such rules under the Securities Act.
“Rule 430B Information” shall mean information with respect to the Securities and the
offering thereof permitted to be omitted from the Registration Statement when it becomes
effective pursuant to Rule 430B.
“Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.
30
If the foregoing is in accordance with your understanding of our agreement, please sign and
return to us the enclosed duplicate hereof, whereupon and your acceptance shall represent a binding
agreement among the Company, the Operating Partnership and the several Underwriters.
| Very truly yours, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ INC. |
||||
| By: | /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||
| Title: | Chief Executive Officer and President | |||
| ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ By: CS Business Trust I, its General Partner |
||||
| By: | /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||
| Title: | Trustee | |||
31
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
confirmed and accepted as of the
date first above written.
| By: Citigroup Global Markets Inc. |
||||
| By: | /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ | |||
| Title: | Director | |||
| By: KeyBanc Capital Markets Inc. |
||||
| By: | /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇ ▇. ▇▇▇▇▇▇ | |||
| Title: | Managing Director | |||
For themselves and the other several Underwriters named in
Schedule I to the foregoing Agreement.
Schedule I to the foregoing Agreement.
32
SCHEDULE I
| Number of Underwritten Securities | ||||
| Underwriters | to be Purchased | |||
Citigroup Global Markets Inc. |
8,075,000 | |||
KeyBanc Capital Markets Inc. |
8,075,000 | |||
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc. |
1,900,000 | |||
BB&T Capital Markets, a division of
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, LLC |
475,000 | |||
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc. |
475,000 | |||
Total |
19,000,000 | |||
SCHEDULE II
| Number of Underwritten Securities | ||||
| Underwriters | to be Purchased | |||
Citigroup Global Markets Inc. |
425,000 | |||
KeyBanc Capital Markets Inc. |
425,000 | |||
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc. |
100,000 | |||
BB&T Capital Markets, a division of
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, LLC |
25,000 | |||
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc. |
25,000 | |||
Total |
1,000,000 | |||
The above 1,000,000 shares of common stock will be allocated to ▇▇▇▇▇ ▇. ▇▇▇▇▇.
SCHEDULE III
Issuer Free Writing Prospectuses
None.
SCHEDULE 1(c)
Subsidiaries
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
CS Business Trust I
CS Business Trust II
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Advisors, LLC
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Advisors Management, LLC
▇▇▇▇▇▇ Company
EXHIBIT A
Form of Opinion of Counsel for the Company
EXHIBIT B
Form of Opinion of Local Counsel for the Company
EXHIBIT C
Form of Opinion of Tax Counsel for the Company
EXHIBIT D
Form of Opinion of Maryland Counsel for the Company
EXHIBIT E
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc.
Public Offering of Common Stock
Public Offering of Common Stock
May , 2009
Citigroup Global Markets Inc.
KeyBanc Capital Markets Inc.
As Representatives of the several Underwriters,
c/o Citigroup Global Markets Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
KeyBanc Capital Markets Inc.
As Representatives of the several Underwriters,
c/o Citigroup Global Markets Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
This letter is being delivered to you in connection with the proposed Underwriting Agreement
(the “Underwriting Agreement”), among ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc., a Maryland corporation (the “Company”),
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇, a Delaware limited partnership, and each of you as Representatives of a group
of Underwriters named therein, relating to an underwritten public offering of common stock, $0.01
par value (the “Common Stock”), of the Company.
In order to induce you and the other Underwriters to enter into the Underwriting Agreement,
the undersigned will not, without the prior written consent of each of you, offer, sell, contract
to sell, pledge or otherwise dispose of (or enter into any transaction which is designed to, or
might reasonably be expected to, result in the disposition (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise) by the undersigned or any
affiliate of the undersigned or any person in privity with the undersigned or any affiliate of the
undersigned), directly or indirectly, including the filing (or participation in the filing) of a
registration statement with the U.S. Securities and Exchange Commission (the “Commission”) in
respect of, or establish or increase a put equivalent position or liquidate or decrease a call
equivalent position within the meaning of Section 16 of the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated thereunder with respect to,
any shares of Common Stock of the Company or any securities convertible into, or exercisable or
exchangeable for such Common Stock, enter into any swap, hedge or other arrangement that transfers,
in whole or in part, any of the economic consequences of ownership of Common Stock, whether settled
by delivery of Common Stock or other securities, or publicly disclose an intention to effect any
such transaction, for a period of 60 days after the date of the Underwriting Agreement.
Notwithstanding the foregoing, the undersigned may transfer shares of Common Stock of the Company
or any securities convertible into, or exercisable or exchangeable for such Common Stock (1) to
make a bona fide gift, (2) to make a charitable contribution for estate planning purposes, or (3) a
transfer for the benefit of an immediate family member, provided that in each case, prior to any
such bona fide gift, charitable contribution or other transfer, the donee or transferee has agreed
in writing to be bound by this letter agreement.
Notwithstanding the foregoing, if: (1) during the last 17 days of the 60-day lock-up period
the Company issues an earnings release or material news or a material event relating to the Company
occurs; or (2) prior to the expiration of the 60-day lock-up period, the Company announces that it
will release earnings results during the 16-day period beginning on the last day of the 60-day
lock-up period, the restrictions imposed by this letter shall continue to apply until the
expiration of the 18-day period beginning on the date of the issuance of the earnings release or
the occurrence of the material news or material event.
[Remainder of Page Intentionally Left Blank]
If for any reason the Underwriting Agreement shall be terminated prior to the Closing Date (as
defined in the Underwriting Agreement), this letter agreement shall likewise be terminated.
| Yours very truly, |
||||
| Name: | ||||
| Title: | ||||