Exhibit 1.1
R&W DRAFT
July 24, 1997
10,100,000 SHARES
▇▇ ▇▇▇▇▇ REALTY CORP.
Common Shares of Beneficial Interest
UNDERWRITING AGREEMENT
August __, 1997
▇▇▇▇▇▇ BROTHERS INC.
PRUDENTIAL SECURITIES INCORPORATED
As Representatives of the several
Underwriters named in Schedule 1,
c/▇ ▇▇▇▇▇▇ Brothers Inc.
Three World ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
▇▇ ▇▇▇▇▇ Realty Corp. a Maryland corporation (the "Company"),
intending to qualify for federal income tax purposes as a real estate investment
trust pursuant to Sections 856 through 860 of the Internal Revenue Code of 1986,
as amended, including the regulations and published interpretations thereunder
(the "Code"), ▇▇ ▇▇▇▇▇ Operating Partnership, L.P., a Delaware limited
partnership and the sole general partner of which is the Company (the "Operating
Partnership"), ▇▇ ▇▇▇▇▇ Management LLC, a Delaware limited liability company and
a wholly owned subsidiary of the Operating Partnership (the "Management LLC"),
▇.▇. ▇▇▇▇▇ Management Corp., a New York corporation and in which the Operating
Partnership will own, upon completion of the Formation Transactions (as defined
below), 100% of the non-voting common stock (which represents 95% of the
economic interest therein) (the "Management Corporation"), ▇.▇. ▇▇▇▇▇ Realty,
Inc., a New York corporation and in which the Operating Partnership will own,
upon completion of the Formation Transactions, 100% of the non-voting common
stock (which represents 95% of the economic interest therein) (the "Leasing
Corporation") and Emerald City Construction Corp., a New York corporation and in
which the Operating Partnership will own, upon completion of the Formation
Transactions, 100% of the non-voting common stock (which represents 95% of the
economic interest therein) (the "Construction Corporation," and together with
the Management Corporation and the Leasing Corporation, the "Service
Corporations", and the Service Corporations collectively with the
Company, Operating Partnership and the Management LLC, the "Transaction
Entities") each wish to confirm as follows its agreement with the Underwriters
named in Schedule 1 hereto (the "Underwriters," which term shall also include
any underwriter substituted as hereinafter provided in Section 9 of this
Agreement) for whom ▇▇▇▇▇▇ Brothers Inc. and Prudential Securities Incorporated
are acting as representatives (the "Representatives"), with respect to the sale
by the Company and the purchase by the Underwriters, acting severally and not
jointly (the "Offering"), of an aggregate of 10,100,000 shares (the "Firm
Shares") of the Company's common stock, par value $.01 per share (the "Common
Shares"). In addition, the Company proposes to grant to the Underwriters an
option to purchase up to an additional 1,515,000 Common Shares on the terms and
for the purposes set forth in Section 2 (the "Option Shares"). The Firm Shares
and the Option Shares, if purchased, are hereinafter collectively called the
"Shares."
Capitalized terms used but not otherwise defined herein shall have the
meanings given to those terms in the Prospectus (as herein defined).
The Transaction Entities understand that the Underwriters propose to
make a public offering of the Shares as soon as the Representatives deem
advisable after the Registration Statement becomes effective and this Agreement
has been executed and delivered.
At or prior to the First Delivery Date (as hereinafter defined), the
Company will have completed the Formation Transactions, described in the
Prospectus under the heading "Structure and Formation of the Company --
Formation Transactions." As part of these transactions, (i) the Underwriters
will purchase the Shares and offer them in a public offering as contemplated
hereunder, (ii) Green Realty LLC one of the Company's predecessor entities
entered into a loan with ▇▇▇▇▇▇ Brothers Holdings Inc., an affiliate of ▇▇▇▇▇▇
Brothers Inc., for the amount of up to $40 million (the "LBHI Loan"), (iii) the
Company will contribute a portion of the net proceeds of the Offering to the
Operating Partnership in exchange for equity interests in the Operating
Partnership ("Units"), which are exchangeable for cash or, at the option of the
Company, Common Shares, (iv) certain executive officers and directors of the
Company were issued 383,110 shares of restricted Common Shares, (v) the
Operating Partnership will receive a contribution of its interests in the Core
Portfolio, the option to acquire the Option Property as well as all of the
non-voting common stock (representing 95% of the economic interest) in each of
the Service Corporations from the Property-owning entities, the partners or
members of such entities and the holders of the remaining interest in the
Service Corporations (the "▇.▇. ▇▇▇▇▇ Group") in exchange for Units, (vi) the
management and leasing business previously conducted by the Management
Corporation, with respect to the Properties, will be transferred to the
Management LLC, (vii) the Operating Partnership will acquire interests in the
Acquisition Properties to be funded with mortgage financing and a portion of the
net proceeds from the Offering, (viii) the Operating Partnership will use the
net proceeds of the sale of Shares hereunder as described in the Prospectus
under the heading "Use of Proceeds," and (ix) the Company will issue to ▇▇▇▇▇▇
Capital 45,495 shares of restricted Common Shares and the Operating Partnership
will pay $900,000 to ▇▇▇▇▇▇ Capital (the foregoing transactions, as more
particularly described in the Prospectus, are referred to herein as the
"Formation Transactions").
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1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE TRANSACTION
ENTITIES. Each of the Transaction Entities, jointly and severally, represents,
warrants and agrees that, as of the date hereof:
(a) A registration statement on Form S-11 (No. 333-29329), and
any amendments thereto, with respect to the Shares has (i) been
prepared by the Company in conformity with the requirements of the
United States Securities Act of 1933, as amended (the "Securities
Act") and the rules and regulations (the "Rules and Regulations") of
the United States Securities and Exchange Commission (the
"Commission") thereunder, (ii) been filed with the Commission under
the Securities Act and (iii) become effective under the Securities
Act. Copies of such registration statement and any amendments thereto
have been delivered by the Company to you as the Representatives of
the Underwriters. As used in this Agreement, "Effective Time" means
the date and the time as of which such registration statement, or the
most recent post-effective amendment thereto, if any, was declared
effective by the Commission; "Effective Date" means the date of the
Effective Time; "Preliminary Prospectus" means each prospectus
included in such registration statement, or amendments thereto, before
it became effective under the Securities Act and any prospectus filed
with the Commission by the Company with the consent of the
Representatives pursuant to Rule 424(a) of the Rules and Regulations;
"Registration Statement" means such registration statement, as amended
at the Effective Time, including all information contained in the
final prospectus filed with the Commission pursuant to Rule 424(b) of
the Rules and Regulations and deemed to be a part of the registration
statement as of the Effective Time pursuant to paragraph (b) of
Rule 430A of the Rules and Regulations; and "Prospectus" means such
final prospectus, as first filed with the Commission pursuant to
paragraph (1) or (4) of Rule 424(b) of the Rules and Regulations.
Any registration statement (including any amendment or supplement
thereto or information which is deemed to be a part thereof) filed by
the Company to register additional Common Shares under Rule 462(b) of
the Rules and Regulations ("Rule 462(b) Registration Statement") shall
be deemed a part of the Registration Statement. Any prospectus
(including any amendment or supplement thereto or information which is
deemed to be a part thereof) included in a Rule 462(b) Registration
Statement shall be deemed to be part of the Prospectus. If a Rule
462(b) Registration Statement is filed in connection with the offering
and sale of the Shares, the Company will have complied or will comply
with the requirements of Rule 111 under the Securities Act relating to
the payment of filing fees therefor. The Company has not distributed,
and prior to the later of the Closing Date and the completion of the
distribution of the Shares, will not distribute, any offering material
in connection with the offering or sale of the Shares other than the
Registration Statement, the Preliminary Prospectus (as hereinafter
defined), the Prospectus or any other materials, if any, permitted by
the Act (which were disclosed to the Underwriters and Underwriters'
counsel).
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(b) Each Preliminary Prospectus included as part of the
Registration Statement as originally filed or as part of any amendment
or supplement thereto, or filed pursuant to Rule 424 under the
Securities Act and the Rules and Regulations, complied when so filed
in all material respects with the provisions of the Securities Act.
The Commission has not issued any order preventing or suspending the
use of any Preliminary Prospectus.
(c) The Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement or
the Prospectus will, when they become effective or are filed with the
Commission, as the case may be, conform in all material respects to
the requirements of the Securities Act and the Rules and Regulations
and do not and will not, as of the applicable Effective Date (as to
the Registration Statement and any amendment thereto) and as of the
applicable filing date and at the First Delivery Date (as to the
Prospectus and any amendment or supplement thereto) contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading (with respect to the Prospectus, in light of the
circumstances under which they were made); PROVIDED that no
representation or warranty is made as to information contained in or
omitted from the Registration Statement or the Prospectus in reliance
upon and in conformity with written information furnished to the
Company through the Representatives by or on behalf of any Underwriter
specifically for inclusion therein. The Prospectus delivered to the
Underwriters for use in connection with the offering of Shares will,
at the time of such delivery, be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to
▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(d) 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 any of the Transaction Entities, threatened by the Commission or by
the state securities authority of any jurisdiction. No order
preventing or suspending the use of any Preliminary Prospectus or the
Prospectus has been issued and no proceeding for that purpose has been
instituted or, to the knowledge of any of the Transaction Entities,
threatened by the Commission or by the state securities authority of
any jurisdiction.
(e) The Company has been duly formed and is validly existing as
a corporation in good standing under the laws of the State of
Maryland, is duly qualified to do business and is in good standing as
a foreign corporation in each jurisdiction in which its ownership or
lease of property and other assets or the conduct of its business
requires such qualification, except where the failure to so qualify
will not have a material adverse effect on the business, prospects,
operations, management, consolidated financial position, net worth,
stockholders'
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equity or results of operations of the Transaction Entities considered
as one enterprise or on the use or value of the Properties,
collectively (a "Material Adverse Effect"), and has all power and
authority necessary to own or hold its properties and other assets, to
conduct the business in which it is engaged and to enter into and
perform its obligations under this Agreement and the other Operative
Documents (as herein defined) to which it is a party and in connection
with the Formation Transactions. None of the subsidiaries of the
Company (other than the Operating Partnership, the Management
Corporation, the Management LLC, the Leasing Corporation and
Construction Corporation) is a "significant subsidiary," as such term
is defined in Rule 405 of the Rules and Regulations. Except as
described in the Prospectus, the Company owns no direct or indirect
equity interest in any entity other than the Transaction Entities.
(f) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued Common Shares (other than the
Shares) have been duly and validly authorized and issued, are fully
paid and non-assessable, have been offered and sold in compliance with
all applicable laws (including, without limitation, federal or state
securities laws), and conform to the description thereof contained in
the Prospectus. Except as disclosed in the Prospectus, (i) no Common
Shares are reserved for any purpose, (ii) except for the Units, there
are no outstanding securities convertible into or exchangeable for any
Common Shares, and (iii) there are no outstanding options, rights
(preemptive or otherwise) or warrants to purchase or subscribe for
Common Shares or any other securities of the Company.
(g) 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, is duly qualified to do business and is
in good standing as a foreign limited partnership in each jurisdiction
in which its ownership or lease of property and other assets or the
conduct of its business requires such qualification, except where the
failure to so qualify will not have a Material Adverse Effect, and has
all power and authority necessary to own or hold its properties and
other assets, to conduct the business in which it is engaged and to
enter into and perform its obligations under this Agreement and the
other Operative Documents to which it is a party and in connection
with the Formation Transactions. The Company is the sole general
partner of the Operating Partnership. At the First Delivery Date, the
Agreement of Limited Partnership of the Operating Partnership, as
amended (the "Operating Partnership Agreement") will be in full force
and effect, and 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
over-allotment option described in Section 2 hereof is exercised at
the First Delivery Date, the percentage interest of such partners in
the Operating Partnership will be adjusted accordingly. Additionally,
to the extent any portion of such over-allotment option is exercised
subsequent to the First Delivery
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Date, the Company will contribute the proceeds from the sale of the
Option Shares to the Operating Partnership in exchange for a number of
Units equal to the number of Option Shares issued.
(h) Each of the Service Corporations has been duly formed and is
validly existing as a corporation in good standing under the laws of
the State of New York, is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which its
ownership or lease of property and other assets or the conduct of its
business requires such qualification, except where the failure to so
qualify would not have a Material Adverse Effect, and has all power
and authority necessary to own or hold its properties and other
assets, to conduct the business in which it is engaged and to enter
into and perform its obligations under this Agreement and the other
Operative Documents to which it is a party and in connection with the
Formation Transactions. All of the issued and outstanding capital
stock of each Service Corporation has been duly authorized and validly
issued, is fully paid and non-assessable, has been offered and sold in
compliance with all applicable laws (including, without limitation,
federal or state securities laws) and, all of such capital stock owned
by the Operating Partnership (100% of the nonvoting common stock) is
owned free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim, restriction or equities. No shares of capital
stock of any Service Corporation are reserved for any purpose, and
there are no outstanding securities convertible into or exchangeable
for any capital stock of any Service Corporation and no outstanding
options, rights (preemptive or otherwise) or warrants to purchase or
to subscribe for shares of such capital stock or any other securities
of any Service Corporation.
(i) The Management LLC has been duly formed and is validly
existing as a limited liability company in good standing under the
laws of the State of Delaware, is duly qualified to do business and is
in good standing as a foreign limited liability company in each
jurisdiction in which its ownership or lease of property and other
assets or the conduct of its business requires such qualification,
except where the failure to so qualify would not have a Material
Adverse Effect, and has all power and authority necessary to own or
hold its properties and other assets, to conduct the business in which
it is engaged and to enter into and perform its obligations under this
Agreement and the other Operative Documents to which it is a party.
All of the issued and outstanding membership interests of the
Management LLC has been duly authorized and validly issued, are fully
paid and non-assessable, has been offered and sold in compliance with
all applicable laws (including, without limitation, federal or state
securities laws) and, 100% of the membership interests are owned by
the Operating Partnership free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim, restriction or equities.
No membership interests of the Management LLC are reserved for any
purpose, and there are no outstanding securities convertible into or
exchangeable for any membership interests of the Management LLC and no
outstanding options,
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rights (preemptive or otherwise) or warrants to purchase or to
subscribe for membership interests or any other securities of the
Management LLC.
(j) The Shares have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will
be duly and validly issued, fully paid and non-assessable. The
issuance and sale by the Company of the Common Shares (other than the
Shares) in connection with the Formation Transactions at or prior to
the First Delivery Date are exempt from the registration requirements
of the Securities Act and applicable state securities, real estate
syndication and blue sky laws. The terms of the Common Shares conform
in substance to all statements and descriptions related thereto
contained in the Prospectus. The form of the certificates to be used
to evidence the Common Shares will, at the First Delivery Date, be in
due and proper form and will comply with all applicable legal
requirements. The issuance of the Shares is not subject to any
preemptive or other similar rights.
(k) The [887,895] Units have been duly authorized for issuance
by the Operating Partnership to the continuing investors and, assuming
that the continuing investors, as limited partners of the Operating
Partnership, do not participate in the control of the business of the
Operating Partnership, upon issuance of and payment for the Units as
contemplated by the Operating Partnership Agreement, the Units will
represent valid and, subject to the qualifications set forth herein,
will be fully paid and nonassessable limited partner interests in the
Operating Partnership as to which the continuing investors, in their
capacity as limited partners of the Operating Partnership, will have
no liability in excess of their obligations to make contributions to
the Operating Partnership, their obligations to make other payments
provided for in the Operating Partnership Agreement and their share of
the Operating Partnership's assets and undistributed profits (subject
to the obligation of a limited partner of the Operating Partnership to
repay any funds wrongfully distributed to it). The terms of the Units
conform in all material respects to statements and descriptions
related thereto contained in the Prospectus.
(l) (A) This Agreement has been duly and validly authorized,
executed and delivered by each of the Transaction Entities, and
assuming due authorization, execution and delivery by the
Representatives, is a valid and binding agreement of each of the
Transaction Entities, enforceable against the Transaction Entities in
accordance with its terms, except to the extent that such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws relating to or affecting
creditors' rights and general principles of equity and except as
rights to indemnity and contribution thereunder may be limited by
applicable law or policies underlying such law; (B) at the First
Delivery Date, the Operating Partnership Agreement and the members
agreement of the Management LLC will have been duly and validly
authorized, executed and delivered by the parties thereto and will be
a valid and binding agreement of the parties thereto,
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enforceable against such parties in accordance with its terms, except
to the extent that such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws relating
to or affecting creditors' rights and general principles of equity and
except as rights to indemnity and contribution thereunder may be
limited by applicable law or policies underlying such law; (C) (i) the
omnibus contribution agreement by and among the Operating Partnership
and the ▇▇ ▇▇▇▇▇ Group members named therein, and (ii) the
supplemental representations and warranties agreement by and among the
Company, the Operating Partnership and the Indemnitors named therein
(collectively the "Contribution Agreements"), have been duly and
validly authorized, executed and delivered by each Transaction Entity
that is a party thereto, and is a valid and binding agreement,
enforceable against such Transaction Entity, in accordance with their
terms, except to the extent that such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or other similar
laws relating to or affecting creditors' rights and general principles
of equity and except as rights to indemnity and contribution
thereunder may be limited by applicable law or policies underlying
such law and, at the First Delivery Date, none of the Transaction
Entities has any reason to believe that the Contribution Agreements
have not been duly and validly authorized by all other parties
thereto; (D) at the First Delivery Date, any agreement by and between
the Service Corporations and/or the Management LLC and the Company
(the "Management Agreements") will have been duly and validly
authorized, executed and delivered by the parties thereto and will be
a valid and binding agreement, enforceable against the parties thereto
in accordance with its terms, except to the extent that such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws relating to or affecting
creditors' rights and general principles of equity and except as
rights to indemnity and contribution thereunder may be limited by
applicable law or policies underlying such law; (E) the employment and
noncompetition agreements between the Company and each of ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇ (the "Employment Agreements") will have been
duly and validly authorized, executed and delivered by the parties
thereto and will each be a valid and binding agreement, enforceable
against the parties thereto in accordance with its terms, except to
the extent that such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws relating
to or affecting creditors' rights and general principles of equity and
except as rights to indemnity and contribution thereunder may be
limited by applicable law or policies underlying such law; (F) the
agreements pursuant to which the Company will acquire the Acquisition
Properties (the "Acquisition Agreements") will have been duly and
validly authorized, executed and delivered by each Transaction Entity
that is a party thereto, and are valid and binding agreements,
enforceable against such Transaction Entity in accordance with its
terms, except to the extent that such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization
8
or other similar laws relating to or affecting creditors' rights and
general principles of equity and except as rights to indemnity and
contribution thereunder may be limited by applicable law or policies
underlying such law; (G) the agreement pursuant to which the Company
has the option to acquire the Option Property (the "Option Agreement")
has been duly and validly authorized, executed and delivered by each
Transaction Entity that is a party thereto, and is a valid and binding
agreement, enforceable against such Transaction Entity in accordance
with its terms, except to the extent that such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or other
similar laws relating to or affecting creditors' rights and general
principles of equity and except as rights to indemnity and
contribution thereunder may be limited by applicable law or policies
underlying such law; and (H) at the First Delivery Date, the lockup
agreements by each of the Company, the Operating Partnership and
certain executive officers and directors of the Company (the "Lock-up
Agreements") will have been duly and validly authorized, executed and
delivered by such parties and will be a valid and binding agreement of
such parties, enforceable against such parties in accordance with
their terms except to the extent that such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or other
similar laws relating to or affecting creditors' rights and general
principles of equity and except as rights to indemnity and
contribution thereunder may be limited by applicable law or policies
underlying such law. This Agreement, the Operating Partnership
Agreement, the Contribution Agreements, the Employment Agreements, the
Option Agreement, the Acquisition Agreements and the Lock-Up
Agreements are sometimes hereinafter collectively called the
"Operative Documents."
(m) The execution, delivery and performance of each Operative
Document by each of the Transaction Entities and the consummation of
the transactions contemplated hereby and thereby will not conflict
with or result in a breach or violation of any of the terms or
provisions of, or constitute (with or without the giving of notice or
the passage of time, or both) a default (or give rise to any right of
termination, cancellation or acceleration) under any of the terms,
conditions or provisions of any note, bond, indenture, mortgage, deed
of trust, lease, license, contract, loan agreement or other agreement
or instrument to which any of the Transaction Entities is a party or
by which any of the Transaction Entities is bound or to which any of
the Properties or other assets of any of the Transaction Entities is
subject, nor will such actions result in any violation of any of the
provisions of the charter, by-laws, certificate of limited
partnership, agreement of limited partnership or other organizational
document of any of the Transaction Entities, or any statute or any
order, writ, injunction, decree, rule or regulation of any court or
governmental agency or body having jurisdiction over any of the
Transaction Entities or any of their properties or assets, except for
any such breach or violation that would not have a Material Adverse
Effect; and except for the registration of the Shares under the
Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under
9
the Exchange Act by the New York Stock Exchange, Inc. ("NYSE"), or the
National Association of Securities Dealers, Inc. ("NASD"), and
applicable state securities laws in connection with the purchase and
distribution of the Shares by the Underwriters, issuance of Common
Shares to certain executive officers and directors of the Company and
the issuance of Units in connection with the Formation Transactions,
no consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or body is
required for the execution, delivery and performance of the Operative
Documents by the Transaction Entities and the consummation of the
transactions contemplated hereby and thereby.
(n) Except as described or referred to in the Registration
Statement, there are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company to file a registration statement under the
Securities Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
(o) Except as described in the Registration Statement, no
Transaction Entity has sold or issued any securities during the
six-month period preceding the date of the Prospectus, including any
sales pursuant to Rule 144A under, or Regulations D or S of, the
Securities Act.
(p) None of the Transaction Entities nor any of the Properties
has sustained, since the date of the latest audited financial
statements included in the Prospectus, any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, other than
as set forth or contemplated in the Prospectus; and, since such date,
there has not been any change in the capital stock or long-term debt
of any of the Transaction Entities or any material adverse change, or
any development involving a prospective material adverse change, in or
affecting any of the Properties or the business, prospects,
operations, management, financial position, net worth, stockholders'
equity or results of operations of any of the Transaction Entities or
use or value of the Properties, other than as set forth or
contemplated in the Formation Transactions.
(q) The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement or
included in the Prospectus present fairly the financial condition, the
results of operations, the statements of cash flows and the statements
of stockholders' equity and other information purported to be shown
thereby of the Company and its consolidated subsidiaries, at the dates
and for the periods indicated, have been prepared in conformity with
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generally accepted accounting principles applied on a consistent basis
throughout the periods involved and are correct and complete and are
in accordance with the books and records of the Company and its
consolidated subsidiaries. The summary and selected financial data
included in the Prospectus present fairly the information shown
therein as at the respective dates and for the respective periods
specified, and the summary and selected financial data have been
presented on a basis consistent with the financial statements so set
forth in the Prospectus and other financial information. Pro forma
financial information included in the Prospectus has been prepared in
accordance with the applicable requirements of the Securities Act and
the Regulations with respect to pro forma financial information and
includes all adjustments necessary to present fairly the pro forma
financial position of the Company at the respective dates indicated
and the results of operations for the respective periods specified.
No other financial statements (or schedules) of the Company, or any
predecessor of the Company are required by the Securities Act to be
included in the Registration Statement or the Prospectus.
(r) Ernst & Young LLP, who have certified certain financial
statements of the Company, whose reports appear in the Prospectus and
who have delivered the initial letter referred to in Section 7(f)
hereof, are, and during the periods covered by such reports were,
independent public accountants as required by the Securities Act and
the Rules and Regulations.
(s) (A) At the First Delivery Date, the Operating Partnership or
a subsidiary thereof will have good and marketable title to each of
the interests in the Properties and the other assets being contributed
as part of the Formation Transactions, in each case free and clear of
all liens, encumbrances, claims, security interests and defects, other
than those referred to in the Prospectus or those which would not have
a Material Adverse Effect and all material consents or approvals with
respect to any such transfer shall have been received; (B) all liens,
charges, encumbrances, claims or restrictions on or affecting any of
the Properties and the assets of any Transaction Entity which are
required to be disclosed in the Prospectus are disclosed therein;
(C) except as otherwise described in the Prospectus, neither any
Transaction Entity nor any tenant of any of the Properties is in
default under (i) any space leases (as lessor or lessee, as the case
may be) relating to the Properties, or (ii) any of the mortgages or
other security documents or other agreements encumbering or otherwise
recorded against the Properties, and no Transaction Entity knows of
any event which, but for the passage of time or the giving of notice,
or both, would constitute a default under any of such documents or
agreements except with respect to (i) and (ii) immediately above any
such default that would not have a Material Adverse Effect; (D) no
tenant under any of the leases at the Properties has a right of first
refusal to purchase the premises demised under such lease which has
not been waived with respect to the Formation Transactions; (E) to the
best knowledge of the Company, each of the Properties complies with
all applicable codes, laws and regulations (including, without
11
limitation, building and zoning codes, laws and regulations and laws
relating to access to the Properties), except for such failures to
comply that would not have a Material Adverse Effect; and (F) no
Transaction Entity has knowledge of any pending or threatened
condemnation proceedings, zoning change or other proceeding or action
that will in any material manner affect the size of, use of,
improvements on, construction on or access to the Properties.
(t) Immediately following the application of the net proceeds of
the sale of the Firm Shares to repay mortgage debt encumbering the
Core Portfolio and the LBHI Loan in the manner set forth in the
Prospectus, the mortgages which will encumber the Properties will not
be convertible into equity securities of the entity owning such
Property and said mortgages and deeds of trust will not be
cross-defaulted or cross-collateralized with any property other than
other Properties.
(u) Except as described or referred to in the Prospectus, at the
First Delivery Date, the Operating Partnership or a subsidiary thereof
will have obtained title insurance on the fee interests in each of the
Properties, in an amount at least equal to the greater of (a) the
mortgage indebtedness of each such Property or (b) the purchase price
of each such Property.
(v) Except as disclosed in the Prospectus; (A) to the knowledge
of the Transaction Entities, after due inquiry, the operations of the
Transaction Entities and the Properties are in compliance with all
Environmental Laws (as defined below) and all requirements of
applicable permits, licenses, approvals and other authorizations
issued pursuant to Environmental Laws; (B) to the knowledge of the
Transaction Entities, after due inquiry, none of the Transaction
Entities or any Property has caused or suffered to occur any Release
(as defined below) of any Hazardous Substance (as defined below) into
the Environment (as defined below) on, in, under or from any Property,
and no condition exists on, in, under or adjacent to any Property that
could result in the incurrence of liabilities under, or any violations
of, any Environmental Law or give rise to the imposition of any Lien
(as defined below), under any Environmental Law; (C) none of the
Transaction Entities has received any written notice of a claim under
or pursuant to any Environmental Law or under common law pertaining to
Hazardous Substances on, in, under or originating from any Property;
(D) none of the Transaction Entities has actual knowledge of, or
received any written notice from any Governmental Authority (as
defined below) claiming any violation of any Environmental Law or a
determination to undertake and/or request the investigation,
remediation, clean-up or removal of any Hazardous Substance released
into the Environment on, in, under or from any Property; and (E) no
Property is included or, to the knowledge of the Transaction Entities,
after due inquiry, proposed for inclusion on the National Priorities
List issued pursuant to CERCLA (as defined below) by the United States
Environmental Protection Agency (the "EPA") or on the Comprehensive
Environmental Response,
12
Compensation, and Liability Information System database maintained by
the EPA, and none of the Transaction Entities has actual knowledge
that any Property has otherwise been identified in a published writing
by the EPA as a potential CERCLA removal, remedial or response site
or, to the knowledge of the Transaction Entities, is included on any
similar list of potentially contaminated sites pursuant to any other
Environmental Law.
As used herein, "Hazardous Substance" shall include any hazardous
substance, hazardous waste, toxic substance, pollutant or hazardous
material, including, without limitation, oil, petroleum or any
petroleum-derived substance or waste, asbestos or asbestos-containing
materials, PCBs, pesticides, explosives, radioactive materials,
dioxins, urea formaldehyde insulation or any constituent of any such
substance, pollutant or waste which is subject to regulation under any
Environmental Law (including, without limitation, materials listed in
the United States Department of Transportation Optional Hazardous
Material Table, 49 C.F.R. Section 172.101, or in the EPA's List of
Hazardous Substances and Reportable Quantities, 40 C.F.R. Part 302);
"Environment" shall mean any surface water, drinking water, ground
water, land surface, subsurface strata, river sediment, buildings,
structures, and ambient, workplace and indoor and outdoor air;
"Environmental Law" shall mean the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended (42
U.S.C. Section 9601 et seq.) ("CERCLA"), the Resource Conservation
and Recovery Act of 1976, as amended (42 U.S.C. Section 6901, et
seq.), the Clean Air Act, as amended (42 U.S.C. Section 7401, et
seq.), the Clean Water Act, as amended (33 U.S.C. Section 1251, et
seq.), the Toxic Substances Control Act, as amended (15 U.S.C. Section
2601, et seq.), the Occupational Safety and Health Act of 1970, as
amended (29 U.S.C. Section 651, et seq.), the Hazardous Materials
Transportation Act, as amended (49 U.S.C. Section 1801, et seq.), and
all other federal, state and local laws, ordinances, regulations,
rules and orders relating to the protection of the environments or of
human health from environmental effects; "Governmental Authority"
shall mean any federal, state or local governmental office, agency or
authority having the duty or authority to promulgate, implement or
enforce any Environmental Law; "Lien" shall mean, with respect to any
Property, any mortgage, deed of trust, pledge, security interest,
lien, encumbrance, penalty, fine, charge, assessment, judgment or
other liability in, on or affecting such Property; and "Release" shall
mean any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping, emanating or
disposing of any Hazardous Substance into the Environment, including,
without limitation, the abandonment or discard of barrels, containers,
tanks (including, without limitation, underground storage tanks) or
other receptacles containing or previously containing any Hazardous
Substance.
None of the environmental consultants which prepared environmental and
asbestos inspection reports with respect to any of the Properties was
employed for such purpose on a contingent basis or has any substantial
interest in the Company or any
13
of its Subsidiaries, and none of them nor any of their directors,
officers or employees is connected with the Company or any of its
subsidiaries as a promoter, selling agent, voting trustee, director,
officer or employee.
(w) Except as described or referred to in the Registration
Statement, the Transaction Entities are insured by insurers of
recognized financial responsibility against such losses and risks and
in such amounts and covering such risks as are customary in the
businesses in which they are engaged or propose to engage after giving
effect to the transactions described in the Prospectus; and neither
the Company nor any other Transaction Entity 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 their business at a
cost that would not have a Material Adverse Effect.
(x) Each Transaction Entity owns or possesses adequate rights to
use all material patents, patent applications, trademarks, service
marks, trade names, trademark registrations, service ▇▇▇▇
registrations, copyrights and licenses necessary for the conduct of
its business and has no reason to believe that the conduct of its
business will conflict with, and has not received any notice of any
claim of conflict with, any such rights of others.
(y) Except as described in the Prospectus, there are no legal or
governmental proceedings pending to which any Transaction Entity or
▇.▇. ▇▇▇▇▇ Group member is a party or of which any property or assets
of any Transaction Entity is the subject which, if determined
adversely to such Transaction Entity or ▇.▇. ▇▇▇▇▇ Group member, might
have a Material Adverse Effect; and to the best knowledge of the
Transaction Entities, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others.
(z) There are no contracts or other documents which are required
to be described in the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act or by the Rules and
Regulations which have not been described in the Prospectus or filed
as exhibits to the Registration Statement or incorporated therein by
reference as permitted by the Rules and Regulations. Neither the
Company, nor to the Company's knowledge, any other party is in default
in the observance or performance of any term or obligation to be
performed by it under any agreement listed in the exhibits to the
Registration Statement, and no event has occurred which with notice or
lapse of time or both would constitute such a default, in any such
case which default or event would have a Material Adverse Effect. No
default exists, and no event has occurred which with notice or lapse
of time or both would constitute a default, in the due performance and
observance of any term, covenant or condition, by the Company or any
of its subsidiaries of any other agreement or instrument to which the
Company or any of its subsidiaries is
14
a party or by which any of them or their respective properties or
businesses may be bound or affected which default or event would have
a Material Adverse Effect.
(aa) No relationship, direct or indirect, exists between or among
any of the Transaction Entities on the one hand, and the directors,
officers, stockholders, customers or suppliers of the Transaction
Entities on the other hand, which is required to be described in the
Prospectus which is not so described.
(bb) No labor disturbance by the employees of any Transaction
Entity exists or, to the knowledge of the Transaction Entities, is
imminent which might be expected to have a Material Adverse Effect.
(cc) Each Transaction Entity is in compliance in all material
respects with all presently applicable provisions of the Employee
Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"); no
"reportable event" (as defined in ERISA) has occurred with respect to
any "pension plan" (as defined in ERISA) for which any Transaction
Entity would have any liability; no Transaction Entity has incurred or
expects to incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (ii)
Sections 412 or 4971 of the Code; and each "pension plan" for which
any Transaction Entity would have any liability that is intended to be
qualified under Section 401(a) of the Code is so qualified in all
material respects and nothing has occurred, whether by action or by
failure to act, which would cause the loss of such qualification,
except where the failure to be so qualified would not have a Material
Adverse Effect.
(dd) Each Transaction Entity has filed all federal, state and
local income and franchise tax returns required to be filed through
the date hereof and has paid all taxes due thereon, and no tax
deficiency has been determined adversely to any Transaction Entity
which has had (nor does any Transaction Entity have any knowledge of
any tax deficiency which, if determined adversely to it might have) a
Material Adverse Effect.
(ee) Upon completion of the transactions described in the
Prospectus and the sale of the Shares hereunder, the Company, the
Operating Partnership, the Management LLC and the Service Corporations
will be organized and operated in conformity with the requirements for
qualification of the Company as a real estate investment trust
("REIT") under the Code commencing with the Company's taxable year
ending December 31, 1997, and the proposed method of operation of the
Company, the Operating Partnership, the Management LLC and the Service
Corporations will enable the Company to meet the requirements for
qualification and taxation as a REIT under the Code.
15
(ff) Since the date as of which information is given in the
Prospectus through the date hereof, and except in connection with the
Formation Transactions and as may otherwise be disclosed in the
Prospectus, (i) no Transaction Entity has (a) issued or granted any
securities, (b) incurred any liability or obligation, direct or
contingent, other than liabilities and obligations which were incurred
in the ordinary course of business, (c) entered into any transaction
not in the ordinary course of business or (d) declared or paid any
dividend on its capital stock; and (ii) there has been no Material
Adverse Effect.
(gg) Each Transaction Entity (i) makes and keeps accurate books
and records and (ii) maintains internal accounting controls which
provide reasonable assurance that (A) transactions are executed in
accordance with management's authorization, (B) transactions are
recorded as necessary to permit preparation of its financial
statements and to maintain accountability for its assets, (C) access
to its assets is permitted only in accordance with management's
authorization and (D) the reported accountability for its assets is
compared with existing assets at reasonable intervals.
(hh) No Transaction Entity (i) is in violation of its charter,
by-laws, certificate of limited partnership, agreement of limited
partnership or other similar organizational document except for any
such violation which would not have a Material Adverse Effect, (ii) is
in default, and no event has occurred which, with notice or lapse of
time or both, would constitute a default, in the due performance or
observance of any term, covenant or condition contained in any
material indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it is bound
or to which any of the Properties or any of its other properties or
assets is subject, except for any such default which would not have a
Material Adverse Effect or (iii) is in violation of any law,
ordinance, governmental rule, regulation or court decree to which it
or the Properties or any of its other properties or assets may be
subject or has failed to obtain any material license, permit,
certificate, franchise or other governmental authorization or permit
necessary to the ownership of the Properties or any of its other
properties or assets or to the conduct of its business except for any
such violation which would not have a Material Adverse Effect.
(ii) No Transaction Entity, nor any director, officer, agent,
employee or other person associated with or acting on behalf of any
Transaction Entity, has used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expense relating
to political activity; made any direct or indirect unlawful payment to
any foreign or domestic government official or employee from corporate
funds; violated or is in violation of any provision of the Foreign
Corrupt Practices Act of 1977; or made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment.
16
(jj) No Transaction Entity is an "investment company" within the
meaning of such term under the Investment Company Act of 1940, as
amended, and the rules and regulations of the Commission thereunder.
(kk) The Common Shares have been approved for listing on the NYSE
upon official notice of issuance.
(ll) At or prior to the Closing Time, each of the Formation
Transactions will have occurred in the manner described in the
Prospectus.
(mm) Other than this Agreement and as set forth in the Prospectus
under the heading "Underwriting," there are no contracts, agreements
or understandings between any Transaction Entity and any person that
would give rise to a valid claim against any Transaction Entity or any
Underwriter for a brokerage commission, finder's fee or other like
payment with respect to the consummation of the transactions
contemplated by this Agreement.
(nn) To apply the net proceeds from the sale of the Shares being
sold by the Company in accordance with the description set forth in
the Prospectus under the caption "Use of Proceeds."
(oo) Except as stated in this Agreement and in the Prospectus, no
Transaction Entity has taken, nor will it take, directly or
indirectly, any action designed to or that might reasonably be
expected to cause or result in stabilization or manipulation of the
price of the Common Shares to facilitate the sale or resale of the
Shares.
2. PURCHASE OF THE SHARES BY THE UNDERWRITERS. On the basis of
the representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to sell 10,100,000 Firm
Shares, severally and not jointly, to the several Underwriters and each of
the Underwriters, severally and not jointly, agrees to purchase the number of
Firm Shares set forth opposite that Underwriter's name in Schedule 1 hereto.
The respective purchase obligations of the Underwriters with respect to the
Firm Shares shall be rounded among the Underwriters to avoid fractional
shares, as the Representatives may determine.
In addition, the Company grants to the Underwriters an option to
purchase up to 1,515,000 Option Shares. Such option is granted solely for the
purpose of covering over-allotments in the sale of Firm Shares and is
exercisable as provided in Section 4 hereof. Option Shares shall be purchased
severally for the account of the Underwriters in proportion to the number of
Firm Shares set forth opposite the name of such Underwriters in Schedule 1
hereto. The respective purchase obligations of each Underwriter with respect to
the Option Shares shall be adjusted by the Representatives so that no
Underwriter shall be obligated to purchase Option Shares other than in 100-share
amounts. The price of both the Firm Shares and any Option Shares shall be
$_____ per share.
17
The Company shall not be obligated to deliver any of the Shares to be
delivered on the First Delivery Date or the Second Delivery Date (as hereinafter
defined), as the case may be, except upon payment for all the Shares to be
purchased on such Delivery Date as provided herein.
3. OFFERING OF SHARES BY THE UNDERWRITERS.
Upon authorization by the Representatives of the release of the Firm
Shares, the several Underwriters propose to offer the Firm Shares for sale upon
the terms and conditions set forth in the Prospectus.
It is understood that _______ shares of the Firm Shares will initially
be reserved by the several Underwriters for offer and sale upon the terms and
conditions set forth in the Prospectus and in accordance with the rules and
regulations of the NASD to employees and persons having business relationships
with the Company and its subsidiaries who have heretofore delivered to the
Representatives offers to purchase shares of Firm Shares in form satisfactory to
the Representatives, and that any allocation of such Firm Shares among such
persons will be made in accordance with timely directions received by the
Representatives from the Company; PROVIDED, that under no circumstances will the
Representatives or any Underwriter be liable to the Company or to any such
person for any action taken or omitted in good faith in connection with such
offering to employees and persons having business relationships with the Company
and its subsidiaries. It is further understood that any shares of such Firm
Shares which are not purchased by such persons will be offered by the
Underwriters to the public upon the terms and conditions set forth in the
Prospectus.
4. DELIVERY OF AND PAYMENT FOR THE SHARES. Delivery of and payment
for the Firm Shares shall be made at the office of ▇▇▇▇▇▇ & ▇▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such other date or place as shall be
determined by agreement between the Representatives and the Company, at 10:00
A.M., New York City time, on the third full business day following the date of
this Agreement or on the fourth full business day if the Agreement is executed
after the daily closing time of the New York Stock Exchange (unless postponed in
accordance with the provisions of Section 9 hereof). This date and time are
sometimes referred to as the "First Delivery Date." On the First Delivery Date,
the Company shall deliver or cause to be delivered certificates representing the
Firm Shares to the Representatives for the account of each Underwriter against
payment to or upon the order of the Company of the purchase price by wire
transfer of same-day funds. Time shall be of the essence, and delivery at the
time and place specified pursuant to this Agreement is a further condition of
the obligation of each Underwriter hereunder. Upon delivery, the Firm Shares
shall be registered in such names and in such denominations as the
Representatives shall request in writing not less than two full business days
prior to the First Delivery Date. For the purpose of expediting the checking
and packaging of the certificates for the Firm Shares, the Company shall make
the certificates representing the Firm Shares available for inspection by the
Representatives in New York, New York, not later than 2:00 P.M., New York City
time, on the business day prior to the First Delivery Date.
18
At any time on or before the thirtieth day after the date of this
Agreement, the option granted in Section 2 may be exercised, in whole or in
part, from time to time, by written notice being given to the Company by the
Representatives. Such notice shall set forth the aggregate number of Option
Shares as to which the option is being exercised, the names in which the Option
Shares are to be registered, the denominations in which the Option Shares are to
be issued and the date and time, as determined by the Representatives, when the
Option Shares are to be delivered; PROVIDED, HOWEVER, that this date and time
shall not be earlier than the First Delivery Date nor earlier than the second
business day after the date on which the option shall have been exercised nor
later than the fifth business day after the date on which the option shall have
been exercised. The date and time the Option Shares are delivered are sometimes
referred to as the "Second Delivery Date" and the First Delivery Date and the
Second Delivery Date are sometimes each referred to as a "Delivery Date."
Delivery of and payment for the Option Shares shall be made at the
place specified in the first sentence of the first paragraph of this Section 4
(or at such other place as shall be determined by agreement between the
Representatives and the Company) at 10:00 A.M., New York City time, on the
Second Delivery Date. On the Second Delivery Date, the Company shall deliver or
cause to be delivered the certificates representing the Option Shares to the
Representative for the account of each Underwriter against payment to or upon
the order of the Company of the purchase price by wire transfer of same-day
funds. Time shall be of the essence, and delivery at the time and place
specified pursuant to this Agreement is a further condition of the obligation of
each Underwriter hereunder. Upon delivery, the Option Shares shall be
registered in such names and in such denominations as the Representatives shall
request in the aforesaid written notice. For the purpose of expediting the
checking and packaging of the certificates for the Option Shares, the Company
shall make the certificates representing the Option Shares available for
inspection by the Representatives in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to the Second Delivery Date.
5. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees:
(a) To prepare the Prospectus in a form approved by the
Representatives and to file such Prospectus pursuant to
Rule 424(b) under the Securities Act not later than the Commission's
close of business on the second business day following the execution
and delivery of this Agreement or, if applicable, such earlier time as
may be required by Rule 430A(a)(3) under the Securities Act; to make
no further amendment or any supplement to the Registration Statement
or to the Prospectus except as permitted herein; to advise the
Representatives, promptly after it receives notice thereof, of the
time when any amendment to the Registration Statement has been filed
or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed and to furnish the Representatives
with copies thereof; to advise the Representatives, promptly after it
receives notice thereof, of the issuance by the Commission of any stop
order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus, of the suspension of the
qualification of the Shares for offering or sale in any jurisdiction,
19
of the initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or the Prospectus or for
additional information; and, in the event of the issuance of any stop
order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or suspending any such
qualification, to use promptly its best efforts to obtain its
withdrawal;
(b) To furnish promptly to each of the Representatives and to
counsel for the Underwriters a signed copy of the Registration
Statement as originally filed with the Commission, and each amendment
thereto filed with the Commission, including all consents and exhibits
filed therewith;
(c) To deliver promptly to the Representatives such number of
the following documents as the Representatives shall reasonably
request: (i) conformed copies of the Registration Statement as
originally filed with the Commission and each amendment thereto (in
each case including consents and exhibits other than this Agreement
and the computation of per share earnings) and (ii) each Preliminary
Prospectus, the Prospectus and any amended or supplemented Prospectus;
and, if the delivery of a prospectus is required at any time after the
Effective Time in connection with the offering or sale of the Shares
or any other securities relating thereto and if at such time any
events shall have occurred as a result of which the Preliminary
Prospectus or the Prospectus as then amended or supplemented would
include an 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 when such
Preliminary Prospectus or the Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary to amend or
supplement the Preliminary Prospectus or the Prospectus in order to
comply with the Securities Act or the Exchange Act, to notify the
Representatives and, upon its request, to file such document and to
prepare and furnish without charge to each Underwriter and to any
dealer in securities as many copies as the Representatives may from
time to time reasonably request of an amended or supplemented
Preliminary Prospectus or the Prospectus which will correct such
statement or omission or effect such compliance;
(d) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the
Prospectus that may, in the judgment of the Representatives or Counsel
to the Underwriters, be required by the Securities Act or requested by
the Commission;
(e) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus or any
Prospectus pursuant to Rule 424 of the Rules and Regulations, to
furnish a copy thereof to the Representatives and counsel for the
Underwriters and obtain the consent of the Representatives to the
filing;
20
(f) The Company will make generally available to its security
holders as soon as practicable but no later than 60 days after the
close of the period covered thereby an earnings statement (in form
complying with the provisions of Section 11(a) of the Securities Act
and Rule 158 of the Rules and Regulations), which need not be
certified by independent certified public accountants unless required
by the Securities Act or the Rules and Regulations, covering a
twelve-month period commencing after the "effective date" (as defined
in said Rule 158) of the Registration Statement;
(g) The Company will furnish to each Underwriter, from time to
time during the period when the Prospectus is required to be delivered
under the Securities Act or the Exchange Act of such number of copies
of the Prospectus (as amended or supplemented) as such Underwriter may
reasonably request for the purposes contemplated by the Securities Act
or the Exchange Act or the respective applicable rules and regulations
of the Commission thereunder;
(h) For a period of five years following the Effective Date, to
furnish to the Representatives copies of all materials furnished by
the Company to its stockholders and all public reports and all reports
and financial statements furnished by the Company to the principal
national securities exchange upon which the Common Shares may be
listed pursuant to requirements of or agreements with such exchange or
to the Commission pursuant to the Exchange Act or any rule or
regulation of the Commission thereunder;
(i) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify the Shares for
offering and sale under the securities, real estate syndication or
Blue Sky laws of such jurisdictions as the Representatives may request
and to comply with such laws so as to permit the continuance of sales
and dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Shares;
(j) For a period of 180 days from the date of the Prospectus,
the Company (i) will not, directly or indirectly, offer for sale,
sell, contract to sell, pledge or otherwise dispose of (or enter into
any transaction or device which is designed to, or could be expected
to, result in the disposition by any person at any time in the future
of) any Common Shares or securities convertible into or exercisable or
exchangeable for Common Shares (other than the Shares, shares issued
pursuant to employee benefit plans, qualified stock option plans or
other employee compensation plans existing on the date hereof), or
sell or grant options, rights or warrants with respect to any Common
Shares (other than the grant of options pursuant to option plans
existing on the date hereof), without the prior written consent of
▇▇▇▇▇▇ Brothers Inc.; (ii) will cause each officer, director and
affiliate of the Company who will acquire Units or restricted Common
Shares in the Formation Transactions to furnish to the
Representatives, prior to the First
21
Delivery Date, a letter or letters, in form and substance satisfactory
to counsel for the Underwriters, pursuant to which each such person
shall agree not to, directly or indirectly, offer for sale, sell,
contract to sell, pledge or otherwise dispose of (or enter into any
transaction or device which is designed to, or could be expected to,
result in the disposition by any person at any time in the future of)
any such Units or restricted Common Shares for a period of one year
from the date of the Prospectus, after which time one-third of such
Common Shares or Units held by each such entity or person shall no
longer be subject to such restrictions and an additional one-third
thereof shall be released from such restrictions on each of the second
and third anniversaries of the date of the Prospectus without the
prior written consent of ▇▇▇▇▇▇ Brothers Inc. and the Company; and
(iii) will cause ▇▇▇▇▇▇ Capital to enter into a similar letter for a
period one year after the date of the Prospectus, with respect to the
restricted Common Shares it will receive in connection with the
Formation Transactions without the prior written consent of ▇▇▇▇▇▇
Brothers Inc. and the Company;
(k) Prior to the Effective Date, to apply for the listing of the
Shares on the NYSE, and to use its best efforts to complete that
listing, subject only to official notice of issuance, prior to the
First Delivery Date;
(l) To file with the Commission a report on Form SR pursuant to
Rule 463 of the Rules and Regulations and to deliver promptly to the
Representatives a copy of the report on Form SR filed by it with the
Commission;
(m) To take such steps as shall be necessary to ensure that none
of the Transaction Entities shall become an "investment company"
within the meaning of such term under the Investment Company Act of
1940, as amended, and the rules and regulations of the Commission
thereunder;
(n) The Company will use its best efforts to meet the
requirements to qualify, commencing with its taxable year ending
December 31, 1997, as a REIT under the Code; and
(o) If at any time during the 25-day period after the
Registration Statement becomes effective, any rumor, publication or
event relating to or affecting the Company shall occur as a result of
which in your and the Company's opinion the market price of the Common
Shares has been or is likely to be materially affected (regardless of
whether such rumor, publication or event necessitates a supplement to
or amendment of the Prospectus), the Company will consult with you
concerning the substance of and the advisability of disseminating a
press release or other public statement responding to or commenting on
such rumor, publication or event.
22
6. EXPENSES. The Transaction Entities jointly and severally agree
to pay (a) the costs incident to the authorization, issuance, sale and delivery
of the Shares and any taxes payable in that connection; (b) the costs incident
to the preparation, printing, filing and distribution under the Securities Act
of the Registration Statement and any amendments and exhibits thereto; (c) the
costs of distributing the Registration Statement as originally filed and each
amendment thereto and any post-effective amendments thereof (including, in each
case, exhibits), any Preliminary Prospectus, the Prospectus and any amendment or
supplement to the Prospectus, all as provided in this Agreement; (d) the costs
of producing and distributing this Agreement and any other related documents in
connection with the offering, purchase, sale and delivery of the Shares; (f) the
filing fees incident to securing any required review by the NASD of the terms of
sale of the Shares; (g) any applicable listing or other fees; (h) the fees and
expenses of qualifying the Shares under the securities laws of the several
jurisdictions as provided in Section 5(i) and of preparing, printing and
distributing a Blue Sky Memorandum (including related reasonable fees and
expenses of counsel to the Underwriters); (j) all costs and expenses of the
Underwriters, including the reasonable fees and disbursements of counsel for the
Underwriters, incident to the offer and sale of the Common Shares by the
Underwriters to employees and persons having business relationships with the
Company and its subsidiaries, as described in Section 4; (k) all other costs and
expenses incident to the performance of the obligations of the Transaction
Entities under this Agreement; (l) the costs and charges of any transfer agent
and registrar; (m) any expenses incurred by the Company in connection with a
"road show" presentation to potential investors; and (n) the fees and
disbursements of the Company's counsel and accountants; PROVIDED that, except as
provided in this Section 6 and in Section 12 the Underwriters shall pay their
own costs and expenses, including the costs and expenses of their counsel, any
transfer taxes on the Shares which they may sell and the expenses of advertising
any offering of the Shares made by the Underwriters.
7. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective
obligations of the Underwriters hereunder are subject to the accuracy, when made
and on each Delivery Date, of the representations and warranties of the
Transaction Entities contained herein, to the performance by each Transaction
Entity and of its obligations hereunder, and to each of the following additional
terms and conditions:
(a) If, at the time this Agreement is executed and delivered, it
is necessary for the Registration Statement or a post-effective
amendment thereto to be declared effective before the offering of the
Shares may commence, the Registration Statement or such post-effective
amendment shall have become effective not later than 5:30 P.M.,
New York City time, on the date hereof, or at such later date and time
as shall be consented to in writing by you, and all filings, if any,
required by Rules 424 and 430A under the Rules and Regulations shall
have been timely made; no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceeding
for that purpose shall have been instituted or, to the knowledge of
the Transaction Entities, or any Underwriter, threatened by the
Commission, and any request of the Commission for additional
information (to be included in the Registration Statement or the
23
Prospectus or otherwise) shall have been complied with to the
satisfaction of the Representatives.
(b) Subsequent to the effective date of this Agreement, there
shall not have occurred (i) any Material Adverse Effect, or (ii) any
event or development relating to or involving any Transaction Entity,
or any partner, officer, director or trustee of any Transaction
Entity, which makes any statement of a material fact made in the
Prospectus untrue or which, in the opinion of the Company and its
counsel or the Underwriters and their counsel, requires the making of
any addition to or change in the Prospectus in order to state a
material fact required by the Securities Act or any other law to be
stated therein or necessary in order to make the statements therein
not misleading, if amending or supplementing the Prospectus to reflect
such event or development would, in your opinion, adversely affect the
market for the Shares.
(c) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the Shares,
the Registration Statement and the Prospectus, and all other legal
matters relating to this Agreement and the transactions contemplated
hereby shall be reasonably satisfactory in all material respects to
counsel for the Underwriters, and the Company shall have furnished to
such counsel all documents and information that they may reasonably
request to enable them to pass upon such matters.
(d) ▇▇▇▇▇ & ▇▇▇▇ LLP shall have furnished to the Representatives
its written opinion, as counsel to the Company, addressed to the
Underwriters and dated such Delivery Date, in form and substance
reasonably satisfactory to the Representatives and counsel to the
Underwriters, to the effect that:
(i) The Company has been duly formed and is validly
existing as a corporation in good standing under the laws of the
State of Maryland, is duly qualified to do business and is in
good standing as a foreign corporation in each jurisdiction in
which its ownership or lease of property or other assets or the
conduct of its business requires such qualification, except where
the failure to so qualify would not have a Material Adverse
Effect, and has all power and authority necessary to own or hold
its properties or other assets, to conduct the business in which
it is engaged as described in the Registration Statement and the
Prospectus, and to enter into and perform its obligations under
this Agreement and the other Operative Documents to which it is a
party and in connection with the Formation Transactions.
(ii) The Company has an authorized capitalization as
set forth in the Prospectus, and all of the issued Common Shares
(other than the Shares) have been duly and validly authorized and
issued, are fully paid
24
and non-assessable, have been offered and sold in compliance with
all applicable laws (including, without limitation, federal and
state securities laws) and conform to the description thereof
contained in the Prospectus. Except as disclosed in the
Prospectus, no Common Shares are reserved for any purpose and
except for the Units, there are no outstanding securities
convertible into or exchangeable for any Common Shares, and no
outstanding options, rights (preemptive or otherwise) or warrants
to purchase or subscribe for Common Shares or any other
securities of the Company.
(iii) 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, is duly qualified to do
business and is in good standing as a foreign limited partnership
in each jurisdiction in which its ownership or lease of property
and other assets or the conduct of its business requires such
qualification, except where the failure to so qualify would not
have a Material Adverse Effect, and has all power and authority
necessary to own or hold its properties and other assets, to
conduct the business in which it is engaged as described in the
Registration Statement and the Prospectus, and to enter into and
perform its obligations under this Agreement and the other
Operative Documents to which it is a party and in connection with
the Formation Transactions. The Company is the sole general
partner of the Operating Partnership. The Operating Partnership
Agreement is in full force and effect, and the aggregate
percentage interests of the Company and the limited partners in
the Operating Partnership are as set forth in the Prospectus.
(iv) The Management LLC has been duly formed and is
validly existing as a limited liability company in good standing
under the laws of the State of Delaware, is duly qualified to do
business and is in good standing as a foreign limited liability
company in each jurisdiction in which its ownership or lease of
property and other assets or the conduct of its business requires
such qualification, except where the failure to so qualify would
not have a Material Adverse Effect, and has all power and
authority necessary to own or hold its properties and other
assets, to conduct the business in which it is engaged as
described in the Registration Statement and the Prospectus and to
enter into and perform its obligations under this Agreement and
the other Operative Documents to which it is a party. All of the
issued and outstanding membership interests of the Management LLC
have been duly authorized and validly issued, and 100% of the
membership interest is owned by the Operating Partnership. No
membership interests of the Management LLC are reserved for any
purpose, and there are no outstanding securities convertible into
or exchangeable for any membership interests of the Management
LLC and
25
no outstanding options, rights (preemptive or otherwise) or
warrants to purchase or to subscribe for membership interests or
any other securities of the Management LLC.
(v) Each of the Service Corporations has been duly
formed and is validly existing as a corporation in good standing
under the laws of the State of New York, is duly qualified to do
business and is in good standing as a foreign corporation in each
jurisdiction in which its ownership or lease of property and
other assets or the conduct of its business requires such
qualification, and has all power and authority necessary to own
or hold its properties and other assets, to conduct the business
in which it is engaged as described in the Registration Statement
and the Prospectus, and to enter into and perform its obligations
under this Agreement and the other Operative Documents to which
it is a party and in connection with the Formation Transactions.
All of the issued and outstanding capital stock of each Service
Corporation has been duly authorized and validly issued and is
fully paid and non-assessable, has been offered and sold in
compliance with all applicable laws (including, without
limitation, federal or state securities laws) and, all of such
capital stock is owned by the Operating Partnership (100% of the
nonvoting common stock). No shares of capital stock of any
Service Corporation are reserved for any purpose, and there are
no outstanding securities convertible into or exchangeable for
any capital stock of any Service Corporation and no outstanding
options, rights (preemptive or otherwise) or warrants to purchase
or to subscribe for shares of such capital stock or any other
securities of any Service Corporation.
(vi) The Shares have been duly and validly authorized
and, when issued and delivered against payment therefor as
provided herein, will be duly and validly issued, fully paid and
non-assessable. The issuance and sale by the Company of the
[383,110] Common Shares to certain executive officers of the
Company in connection with the Formation Transactions prior to
the First Delivery Date was exempt from the registration
requirements of the Securities Act and applicable state
securities, real estate syndication and blue sky laws. The terms
of the Common Shares conform in substance to all statements and
descriptions related thereto contained in the Prospectus. The
form of the certificate to be used to evidence the Common Shares
is in due and proper form and comply with all applicable legal
requirements. The issuance of the Shares is not subject to any
preemptive or other similar rights arising under the Articles of
Incorporation or by-laws of the Company, Title 8 of the
Corporations and Associations Article of the Annotated Code of
Maryland, as amended, or any agreement or other instrument to
which the Company is a party known to such counsel.
26
(vii) The [887,895] Units have been duly authorized for
issuance by the Operating Partnership to the continuing investors
and, assuming that the continuing investors, as limited partners
of the Operating Partnership, do not participate in the control
of the business of the Operating Partnership, upon issuance of
and payment for the Units as contemplated by the Operating
Partnership Agreement, the Units will represent valid and,
subject to the qualifications set forth herein, will be fully
paid and nonassessable limited partner interests in the Operating
Partnership, as to which the continuing investors, in their
capacity as limited partners of the Operating Partnership, will
have no liability in excess of their obligations to make
contributions to the Operating Partnership, their obligations to
make other payments provided for in the Operating Partnership
Agreement and their share of the Operating Partnership's assets
and undistributed profits (subject to the obligation of a limited
partner of the Operating Partnership to repay any funds
wrongfully distributed to it). The terms of the Units conform in
all material respects to the statements and descriptions related
thereto contained in the Prospectus.
(viii) (A) This Agreement has been duly and validly
authorized, executed and delivered by the each of the Transaction
Entities and, and assuming due authorization, execution and
delivery by the Representatives, is a valid and binding agreement
of each of the Transaction Entities, enforceable against such
parties in accordance with its terms, except to the extent that
such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws relating to or
affecting creditors' rights and general principles of equity and
except as rights to indemnity and contribution thereunder may be
limited by applicable law or policies underlying such law;
(B) the Operating Partnership Agreement has been duly and validly
authorized, executed and delivered by each Transaction Entity
which is a party thereto and is a valid and binding agreement of
such parties, enforceable against such parties in accordance with
their respective terms, except to the extent that such
enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws relating to or
affecting creditors' rights and general principles of equity and
except as rights to indemnity and contribution thereunder may be
limited by applicable law or policies underlying such law;
(C) each Contribution Agreement has been duly and validly
authorized, executed and delivered by each Transaction Entity
that is a party thereto, and is a valid and binding agreement,
enforceable against such Transaction Entity in accordance with
its terms, except to the extent that such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or
other similar laws relating to or affecting creditors' rights and
general principles of equity and except as rights to
27
indemnity and contribution thereunder may be limited by
applicable law or policies underlying such law; (D) the
Employment Agreements have been duly and validly authorized,
executed and delivered by the Company and are valid and binding
agreements, enforceable against the Company, in accordance with
their respective terms, except to the extent that such
enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws relating to or
affecting creditors' rights and general principles of equity and
except as rights to indemnity and contribution thereunder may be
limited by applicable law or policies underlying such law; (E)
the Acquisition Agreements have been duly and validly authorized,
executed and delivered by each Transaction Entity that is a party
thereto and are valid and binding agreements, enforceable against
such parties, in accordance with their respective terms, except
to the extent that such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or other
similar laws relating to or affecting creditors' rights and
general principles of equity and except as rights to indemnity
and contribution thereunder may be limited by applicable law or
policies underlying such law; (F) the Option Agreement has been
duly and validly authorized, executed and delivered by each
Transaction Entity that is a party thereto and is a valid and
binding agreement, enforceable against such parties, in
accordance with its terms, except to the extent that such
enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws relating to or
affecting creditors' rights and general principles of equity and
except as rights to indemnity and contribution thereunder may be
limited by applicable law or policies underlying such law; and
(G) the Lock-up Agreements of the Company and the Operating
Partnership have been duly and validly authorized, executed and
delivered by the Company or the Operating Partnership, as
applicable, and are valid and binding agreements, enforceable
against such parties in accordance with their terms, except to
the extent that such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws
relating to or affecting creditors' rights and general principles
of equity and except as rights to indemnity and contribution
thereunder may be limited by applicable law or policies
underlying such law.
(ix) The execution, delivery and performance of each
Operative Document by each of the Transaction Entities and the
consummation of the transactions contemplated hereby and thereby
will not conflict with or result in a breach or violation of any
of the terms or provisions of, or constitute a default under any
of the terms, conditions or provisions of, any note, bond,
indenture, mortgage, deed of trust, lease, license, contract,
loan agreement or other agreement or instrument to which any of
the Transaction Entities is a party or by which any of the
28
Transaction Entities is bound or to which any of the Properties
or other assets of any of the Transaction Entities is subject,
nor will such actions result in any violation of the provisions
of the charter, by-laws, certificate of limited partnership,
agreement of limited partnership, or other organizational
documents of any of the Transaction Entities, or any statute or
any order, writ, injunction, decree, rule or regulation of any
court or governmental agency or body having jurisdiction over any
of the Transaction Entities or any of their properties or assets,
except for any such breach or violation that would not have a
Material Adverse Effect; and except for the registration of the
Shares under the Securities Act and such consents, approvals,
authorizations, registrations or qualifications as may be
required under the Exchange Act, by the NYSE or the NASD and
applicable state securities or real estate syndication laws in
connection with the purchase and distribution of the Shares by
the Underwriters, no consent, approval, authorization or order
of, or filing or registration with, any such court or
governmental agency or body is required for the execution,
delivery and performance of the Operative Documents by the
Transaction Entities and the consummation of the transactions
contemplated hereby and thereby.
(x) To such counsel's knowledge, other than as set
forth or referred to in the Registration Statement, there are no
contracts, agreements or understandings between the Company and
any person granting such person the right to require the Company
to file a registration statement under the Securities Act with
respect to any securities of the Company owned or to be owned by
such person or to require the Company to include such securities
in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any
other registration statement filed by the Company under the
Securities Act.
(xi) To such counsel's knowledge, other than as set
forth in the Prospectus, there are no legal or governmental
proceedings pending to which any Transaction Entity is a party or
of which any property or assets of any Transaction Entity is the
subject which, if determined adversely to such Transaction
Entity, might reasonably be expected to have a Material Adverse
Effect; and to the best knowledge of such counsel no such
proceedings are threatened or contemplated by governmental
authorities or threatened by others.
(xii) To the best knowledge of such counsel, there are
no contracts or other documents which are required to be
described in the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act or by the Rules and
Regulations which have not been described in the Prospectus or
filed as exhibits to the Registration Statement
29
or incorporated therein by reference as permitted by the Rules
and Regulations.
(xiii) To the best knowledge of such counsel, no
relationship, direct or indirect, exists between or among any of
the Transaction Entities on the one hand, and the directors,
officers, stockholders, customers or suppliers of the Transaction
Entities on the other hand, which is required to be described in
the Prospectus which is not so described.
(xiv) To the best knowledge of such counsel and other
than as described in the Prospectus, no Transaction Entity (i) is
in violation of its charter, by-laws, certificate of limited
partnership, agreement of limited partnership or other similar
organizational document, (ii) is in default, and no event has
occurred which, with notice or lapse of time or both, would
constitute a default, in the due performance or observance of any
term, covenant or condition contained in any material indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which it is a party or by which it is bound or to
which any of the Properties or any of its other properties or
assets is subject or (iii) is in violation of any law, ordinance,
governmental rule, regulation or court decree to which it or the
Properties or any of its other properties or assets may be
subject or has failed to obtain any material license, permit,
certificate, franchise or other governmental authorization or
permit necessary to the ownership of the Properties or any of its
other properties or assets or to the conduct of its business,
except, in the case of each of (i), (ii) and (iii) immediately
above, any such violation or default that would not have a
Material Adverse Effect.
(xv) The Company is organized in conformity with the
requirements for qualification and taxation as a REIT under the
Code and the Operating Partnership, as constituted after the
Formation Transactions, will be classified as a partnership and
not as (a) an association taxable as a corporation or (b) a
"publicly traded partnership" taxable as a corporation under
Section 7704(a) of the Code.
(xvi) No Transaction Entity is an "investment company"
within the meaning of such term under the Investment Company Act
of 1940, as amended and the rules and regulations of the
Commission thereunder. The Common Shares have been approved for
listing on the New York Stock Exchange upon notice of issuance.
(xvii) The Registration Statement was declared effective
under the Securities Act as of the date and time specified in
such opinion,
30
the Prospectus was filed with the Commission pursuant to the
subparagraph of Rule 424(b) of the Rules and Regulations
specified in such opinion on the date specified therein and, to
the best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and,
to the best knowledge of such counsel, no proceeding for that
purpose is pending or threatened by the Commission.
(xviii) The Registration Statement and the Prospectus and
any further amendments or supplements thereto made by the Company
prior to such Delivery Date (other than the financial statements
and related schedules and other financial and statistical data
included therein, as to which such counsel need express no
opinion) comply as to form in all material respects with the
requirements of the Securities Act and the Rules and Regulations.
(xix) The statements contained in the Prospectus under
the captions "Capital Stock," "Certain Provisions of Maryland Law
and of the Company's Charter and Bylaws," "Shares Available for
Future Sale," "Partnership Agreement," and "Federal Income Tax
Consequences," insofar as those statements are descriptions of
contracts, agreements or other legal documents, or they describe
federal statutes, rules and regulations or legal conclusions,
constitute a fair summary thereof, and the opinion of such
counsel filed as Exhibit 8 to the Registration Statement is
confirmed and the Underwriters may rely upon such opinion as if
it were addressed to them.
In rendering such opinion, such counsel may (i) state that its opinion
is limited to matters governed by the Federal laws of the United
States of America and the States of Delaware, Maryland and New York;
(ii) rely (to the extent such counsel deems proper and specifies in
their opinion), as to matters involving the application of the laws of
the States of Maryland and Delaware upon the opinion of other counsel
of good standing, PROVIDED that such other counsel is reasonably
satisfactory to counsel for the Underwriters and furnishes a copy of
its opinion to the Representatives; (iii) in respect of matters of
fact, upon certificates of officers of the Company or its
subsidiaries, PROVIDED that such counsel shall state that it believes
that both the Underwriters and it are justified in relying upon such
opinions, of local counsel. Such counsel shall also have furnished to
the Representatives a written statement, addressed to the Underwriters
and dated such Delivery Date, in form and substance satisfactory to
the Representatives and counsel to the Underwriters, to the effect
that (x) such counsel has acted as counsel to the Company in
connection with the preparation of the Registration Statement and the
Prospectus, and (y) based on the foregoing, no facts have come to the
attention of such counsel which lead it to believe that the
Registration Statement, as of the Effective Date, contained any untrue
statement of a material
31
fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading,
or that the Prospectus contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading. The foregoing opinion and statement may be
qualified by a statement to the effect that such counsel does not
assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the Registration Statement or the
Prospectus and may state that such counsel expresses no belief with
respect to the financial statements and notes thereto and other
financial and statistical data included in the Registration Statement
or the Prospectus.
(e) The Representatives shall have received from ▇▇▇▇▇▇ & ▇▇▇▇▇,
counsel for the Underwriters, such opinion or opinions, dated such
Delivery Date, with respect to the issuance and sale of the Shares,
the Registration Statement, the Prospectus and other related matters
as the Representatives may reasonably require, and the Company shall
have furnished to such counsel such documents as they reasonably
request for the purpose of enabling them to pass upon such matters.
(f) At the time of execution of this Agreement, the
Representatives shall have received from Ernst & Young LLP a letter,
in form and substance satisfactory to the Representatives, addressed
to the Underwriters and dated the date hereof (i) confirming that they
are independent public accountants within the meaning of the
Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of
Regulation S-X of the Commission, and (ii) stating, as of the date
hereof (or, with respect to matters involving changes or developments
since the respective dates as of which specified financial information
is given in the Prospectus, as of a date not more than five days prior
to the date hereof), the conclusions and findings of such firm with
respect to the financial information and other matters ordinarily
covered by accountants' "comfort letters" to underwriters in
connection with registered public offerings as contemplated in the
Statement on Auditing Standards No. 72.
(g) With respect to the letter of Ernst & Young LLP referred to
in the preceding paragraph and delivered to the Representatives
concurrently with the execution of this Agreement (the "initial
letter"), the Company shall have furnished to the Representatives a
letter (the "bring-down letter") of such accountants, addressed to the
Underwriters and dated such Delivery Date (i) confirming that they are
independent public accountants within the meaning of the Securities
Act and are in compliance with the applicable requirements relating to
the qualification of accountants under Rule 2-01 of Regulation S-X of
the Commission, (ii) stating, as of the date of the bring-down letter
(or, with respect to matters involving changes or developments since
the respective dates as of which specified financial
32
information is given in the Prospectus, as of a date not more than
five days prior to the date of the bring-down letter), the conclusions
and findings of such firm with respect to the financial information
and other matters covered by the initial letter and (iii) confirming
in all material respects the conclusions and findings set forth in the
initial letter.
(h) Each Transaction Entity shall have furnished to the
Representatives a certificate, dated such Delivery Date, of its, or
its general partner's or managing member's Chairman of the Board, its
President or a Vice President and its chief financial officer stating
that:
(i) The representations, warranties and agreements of
the Transaction Entities in Section 1 are true and correct as of
such Delivery Date; the Company has complied with all its
agreements contained herein; and the conditions set forth in
Sections 7(a) and (b) have been fulfilled; and
(ii) They have carefully examined the Registration
Statement and the Prospectus and, in their opinion (A) as of the
Effective Date, the Registration Statement and Prospectus did not
include any untrue statement of a material fact and did not omit
to state a material fact required to be stated therein or
necessary to make the statements therein not misleading (with
respect to the Prospectus, in light of the circumstances under
which they were made), and (B) since the Effective Date no event
has occurred which should have been set forth in a supplement or
amendment to the Registration Statement or the Prospectus.
(i) The NYSE shall have approved the Shares for listing, subject
only to official notice of issuance.
(j) All of the transactions which are to occur in order to
consummate the Formation Transactions shall have been consummated on
terms satisfactory to the Representatives.
(k) On the First Delivery Date, counsel for the Underwriters
shall have been furnished with such documents and opinions as they may
require for the purpose of enabling them to pass upon the issuance and
sale of the Shares as herein contemplated and related proceedings, or
in order to evidence the accuracy of any of the representations or
warranties, or the fulfillment of any of the conditions, herein
contained; and all proceedings taken by the Transaction Entities in
connection with the issuance and sale of the Shares as herein
contemplated shall be satisfactory in form and substance to the
Representatives and counsel for the Underwriters.
33
(l) You shall have been furnished with the written agreements
referred to in Section 5(j) hereof.
(m) The Company shall have furnished or caused to be furnished
to you such further certificates and documents as the Representatives
or counsel to the Underwriters shall have reasonably requested.
(n) In the event that the Underwriters exercise their option
provided in Section 2(b) hereof to purchase all or any portion of the
Option Shares, the representations and warranties of the Transaction
Entities contained herein and the statements in any certificates
furnished by the Transaction Entities hereunder shall be true and
correct as of each Date of Delivery and, at the relevant Date of
Delivery, the Representatives shall have received:
(i) A certificate, dated such Date of Delivery, of the
President or a Vice President of each Transaction Entity or of
its general partner or managing member and of the chief financial
or chief accounting officer of each Transaction Entity or of its
general partner or managing member, and confirming that the
certificate delivered on the First Delivery Date pursuant to
Section 7(h) hereof remains true and correct as of such Date of
Delivery.
(ii) The favorable opinion of ▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for
the Transaction Entities, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Shares to be purchased on such Date of
Delivery and otherwise to the same effect as the opinions
required by Section 7(d) hereof.
(iii) The favorable opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇, counsel
for the Underwriters, dated such Date of Delivery, relating to
the Option Shares to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by
Section 7(e) hereof.
(iv) A letter from Ernst & Young LLP, in form and substance
satisfactory to the Representatives and dated such Date of
Delivery, substantially the same in form and substance as the
letters furnished to the Representatives pursuant to
Sections 7(f) and (g) hereof.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
34
Any certificate or document signed by any officer of the Transaction
Entities and delivered to the Underwriters, or to counsel for the Underwriters,
shall be deemed a representation and warranty by the Transaction Entities to
each Underwriter as to the statements made therein.
The several obligations of the Underwriters to purchase Option Shares
hereunder are subject to the satisfaction on and as of any Date of Delivery of
the conditions set forth in this Section 7, except that, if any Date of Delivery
is other than the First Delivery Date, the certificates, opinions and letters
referred to in Sections 7(d) through 7(i) hereof shall be dated the Date of
Delivery in question and the opinions called for by Sections 7(d) and
7(e) hereof shall be revised to reflect the sale of Option Shares.
8. EFFECTIVE DATE OF AGREEMENT.
This Agreement shall become effective: (i) upon the execution hereof
by the parties hereto; or (ii) if, at the time this Agreement is executed and
delivered, it is necessary for the Registration Statement or a post-effective
amendment thereto to be declared effective before the offering of the Shares may
commence, when notification of the effectiveness of the Registration Statement
or such post-effective amendment has been released by the Commission.
9. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS.
If, on either Delivery Date, any Underwriter defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting Underwriters shall be obligated to purchase the Shares which the
defaulting Underwriter agreed but failed to purchase on such Delivery Date in
the respective proportions which the number of Firm Shares set forth opposite
the name of each remaining non-defaulting Underwriter in Schedule 1 hereto bears
to the total number of Firm Shares set forth opposite the names of all the
remaining non-defaulting Underwriters in Schedule 1 hereto; PROVIDED, HOWEVER,
that the remaining non-defaulting Underwriters shall not be obligated to
purchase any of the Shares on such Delivery Date if the total number of Shares
which the defaulting Underwriter or Underwriters agreed but failed to purchase
on such date exceeds 9.09% of the total number of Shares to be purchased on such
Delivery Date, and any remaining non-defaulting Underwriter shall not be
obligated to purchase more than 110% of the number of Shares which it agreed to
purchase on such Delivery Date pursuant to the terms of Section 2. If the
foregoing maximums are exceeded, the remaining non-defaulting Underwriters, or
those other underwriters satisfactory to the Representatives who so agree, shall
have the right, but shall not be obligated, to purchase, in such proportion as
may be agreed upon among them, all the Shares to be purchased on such Delivery
Date. If the remaining Underwriters or other underwriters satisfactory to the
Representatives do not elect to purchase the Shares which the defaulting
Underwriter or Underwriters agreed but failed to purchase on such Delivery Date,
this Agreement (or, with respect to the Second Delivery Date, the obligation of
the Underwriters to purchase, and of the Company to sell, the Option Shares)
shall terminate without liability on the part of any non-defaulting Underwriter
or the Transaction Entities, except that the Transaction Entities will continue
to be liable for the payment of expenses to the extent
35
set forth in Sections 6 and 12. As used in this Agreement, the term
"Underwriter" includes, for all purposes of this Agreement unless the context
requires otherwise, any party not listed in Schedule 1 hereto who, pursuant to
this Section 9, purchases Initial Shares which a defaulting Underwriter agreed
but failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Transaction Entities for damages caused by its
default. If other underwriters are obligated or agree to purchase the Shares of
a defaulting or withdrawing Underwriter, either the Representatives or the
Company may postpone the Delivery Date for up to seven full business days in
order to effect any changes that in the opinion of counsel for the Company or
counsel for the Underwriters may be necessary in the Registration Statement, the
Prospectus or in any other document or arrangement.
10. INDEMNIFICATION AND CONTRIBUTION.
(a) The Transaction Entities jointly and severally, shall indemnify
and hold harmless each Underwriter, its officers and employees and each person,
if any, who controls any Underwriter within the meaning of the Securities Act,
from and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof (including, but not limited to, any loss, claim,
damage, liability or action relating to purchases and sales of Shares), to which
that Underwriter, officer, employee or controlling person may become subject,
under the Securities Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained (a) in any Preliminary
Prospectus, the Registration Statement or the Prospectus or in any amendment or
supplement thereto or (b) in any blue sky application or other document prepared
or executed by the Company (or based upon any written information furnished by
the Company) specifically for the purpose of qualifying any or all of the Shares
under the securities laws of any state or other jurisdiction (any such
application, document or information being hereinafter called a "Blue Sky
Application"), (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any material fact required to
be stated therein or necessary to make the statements therein not misleading
(with respect to the Prospectus, in light of the circumstances under which they
were made) or (iii) any act or failure to act or any alleged act or failure to
act by any Underwriter in connection with, or relating in any manner to, the
Shares or the offering contemplated hereby, and which is included as part of or
referred to in any loss, claim, damage, liability or action arising out of or
based upon matters covered by clause (i) or (ii) above (PROVIDED that the
Transaction Entities shall not be liable under this clause (iii) to the extent
that it is determined in a final judgment by a court of competent jurisdiction
that such loss, claim, damage, liability or action resulted directly from any
such acts or failures to act undertaken or omitted to be taken by such
Underwriter through its gross negligence or willful misconduct), and shall
reimburse each Underwriter and each such officer, employee or controlling person
promptly upon demand for any legal or other expenses reasonably incurred by that
Underwriter, officer, employee or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred;
36
PROVIDED, HOWEVER, that the Transaction Entities shall not be liable in any such
case to the extent that any such loss, claim, damage, liability or action arises
out of, or is based upon, any untrue statement or alleged untrue statement or
omission or alleged omission made in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any such amendment or
supplement, or in any Blue Sky Application, in reliance upon and in conformity
with written information concerning such Underwriter furnished to the Company
through the Representatives by or on behalf of any Underwriter specifically for
inclusion therein. The foregoing indemnity agreement is in addition to any
liability which the Transaction Entities may otherwise have to any Underwriter
or to any officer, employee or controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless each Transaction Entity, its officers and employees, each of its
directors (including any person who, with his consent, is named in the
Registration Statement as about to become a director of the Company), and each
person, if any, who controls each Transaction Entity within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which each Transaction Entity or
any such director, officer or controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in any Preliminary Prospectus,
the Registration Statement or the Prospectus or in any amendment or supplement
thereto, or (B) in any Blue Sky Application or (ii) the omission or alleged
omission to state in any Preliminary Prospectus, the Registration Statement or
the Prospectus, or in any amendment or supplement thereto, or in any Blue Sky
Application any material fact required to be stated therein or necessary to make
the statements therein not misleading, but in each case only to the extent that
the untrue statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information concerning
such Underwriter furnished to the Company through the Representatives by or on
behalf of that Underwriter specifically for inclusion therein, and shall
reimburse each Transaction Entity and any such director, officer or controlling
person for any legal or other expenses reasonably incurred by each Transaction
Entity or any such director, officer or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred. The foregoing
indemnity agreement is in addition to any liability which any Underwriter may
otherwise have to each Transaction Entity or any such director, officer,
employee or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 10 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 10, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 10 except to the extent it has
been materially prejudiced by such failure and, PROVIDED FURTHER, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 10.
If any such claim or action shall be brought against an indemnified party, and
it shall
37
notify the indemnifying party thereof, the indemnifying party shall be entitled
to participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 10 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; PROVIDED, HOWEVER, that
the Representatives shall have the right to employ counsel to represent jointly
the Representatives and those other Underwriters and their respective officers,
employees and controlling persons who may be subject to liability arising out of
any claim in respect of which indemnity may be sought by the Underwriters
against the Transaction Entities under this Section 10 if, in the reasonable
judgment of the Representatives, it is advisable for the Representatives and
those Underwriters, officers, employees and controlling persons to be jointly
represented by separate counsel, and in that event the fees and expenses of such
separate counsel shall be paid by the indemnifying party. No indemnifying party
shall (i) without the prior written consent of the indemnified parties (which
consent shall not be unreasonably withheld), settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding, or (ii) be
liable for any settlement of any such action effected without its written
consent (which consent shall not be unreasonably withheld), but if settled with
the consent of the indemnifying party or if there be a final judgment of the
plaintiff in any such action, the indemnifying party agrees to indemnify and
hold harmless any indemnified party from and against any loss or liability by
reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 10 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section 10(a) or 10(c) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Transaction Entities on the one hand and the Underwriters on the
other from the offering of the Shares or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Transaction Entities on the one hand
and the Underwriters on the other with respect to the statements or omissions
which resulted in such loss, claim, damage or liability, or action in respect
thereof, as well as any other relevant equitable considerations. The relative
benefits received by the Transaction Entities on the one hand and the
Underwriters on the other with respect to such offering shall be deemed to be in
the same proportion as the total net proceeds from the offering of the Shares
purchased under this Agreement (before deducting expenses) received by the
Transaction Entities, on the one hand, and the total underwriting discounts and
38
commissions received by the Underwriters with respect to the Shares purchased
under this Agreement, on the other hand, bear to the total gross proceeds from
the offering of the Shares under this Agreement, in each case as set forth in
the table on the cover page of the Prospectus. The relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Transaction Entities or the Underwriters, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Transaction
Entities and the Underwriters agree that it would not be just and equitable if
contributions pursuant to this Section were to be determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section shall be deemed to
include, for purposes of this Section 10(d), any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 10(d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares underwritten
by it and distributed to the public was offered to the public exceeds the amount
of any damages which such Underwriter has otherwise paid or become liable to pay
by reason of any untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute as provided in this Section 10(d) are
several in proportion to their respective underwriting obligations and not
joint.
(e) The Underwriters severally confirm and each Transaction Entity
acknowledges that (i) the statements with respect to the public offering of the
Shares by the Underwriters set forth on the cover page of, (ii) the legend
concerning over-allotments on the inside front cover page of and (iii) the names
of the Underwriters and the number of Shares which they are each purchasing, the
concession and reallowance figures and the information contained in the third,
eighth, eleventh, twelfth, thirteenth, fourteenth, fifteenth, sixteenth and the
seventeenth paragraphs, in each case appearing under the caption "Underwriting"
in, the Prospectus are correct and constitute the only information concerning
such Underwriters furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statement and the
Prospectus.
11. TERMINATION. The obligations of the Underwriters hereunder may
be terminated by the Representatives by notice given to and received by the
Company prior to delivery of and payment for the Firm Shares if, prior to that
time, any of the following events shall have occurred or if the Underwriters
shall decline to purchase the Shares for any reason permitted under this
Agreement:
(a)(i) Any of the Transaction Entities or any Property shall have
sustained since the date of the latest audited financial statements
included in the Prospectus
39
any loss or interference with its business from fire, explosion, flood
or other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus or (ii)
since such date there shall have been any change in the capital stock
or long-term debt of any Transaction Entity or any change, or any
development involving a prospective change, in or affecting any
Property or the general affairs, management, financial position,
stockholders' equity or results of operations of any Transaction
Entity, otherwise than as set forth or contemplated in the Prospectus,
the effect of which, in any such case described in clause (i) or (ii),
is, in the judgment of the Representatives, so material and adverse as
to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Shares being delivered on such
Delivery Date on the terms and in the manner contemplated in the
Prospectus;
(b) Subsequent to the execution and delivery of this Agreement
there shall have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange or the American
Stock Exchange or in the over-the-counter market, or trading in any
securities of the Company on any exchange or in the over-the-counter
market, shall have been suspended or minimum prices shall have been
established on any such exchange or such market by the Commission, by
such exchange or by any other regulatory body or governmental
authority having jurisdiction, (ii) a banking moratorium shall have
been declared by Federal or state authorities, (iii) the United States
shall have become engaged in hostilities, there shall have been an
escalation in hostilities involving the United States or there shall
have been a declaration of a national emergency or war by the United
States or (iv) there shall have occurred such a material adverse
change in general economic, political or financial conditions (or the
effect of international conditions on the financial markets in the
United States shall be such) as to make it, in the judgment of a
majority in interest of the several Underwriters, impracticable or
inadvisable to proceed with the public offering or delivery of the
Shares being delivered on such Delivery Date on the terms and in the
manner contemplated in the Prospectus; or
(c) The Transaction Entities shall have failed at or prior to
such Delivery Date to have performed or complied with any of their
agreements herein contained and required to be performed or complied
with by them hereunder at or prior to such Delivery Date.
12. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If (a) the Company
shall fail to tender the Shares for delivery to the Underwriters by reason of
any failure, refusal or inability on the part of the Transaction Entities to
perform any agreement on their part to be performed, or because any condition
specified in Sections 11(a) and (c) hereof required to be fulfilled by the
Transaction Entities is not fulfilled, the Transaction Entities will reimburse
the Underwriters for all reasonable out-of-pocket expenses (including fees and
disbursements of counsel) incurred by
40
the Underwriters in connection with this Agreement and the proposed purchase of
the Shares, and upon demand the Transaction Entities shall pay the full amount
thereof to the Representatives. If this Agreement is terminated pursuant to
Section 11(b) or pursuant to Section 9 by reason of the default of one or more
Underwriters, the Transaction Entities shall not be obligated to reimburse any
defaulting Underwriter on account of those expenses.
13. NOTICES, ETC. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail,
telex or facsimile transmission to ▇▇▇▇▇▇ Brothers Inc., Three World
Financial Center, New York, New York 10285, Attention: Syndicate
Department (Fax: ▇▇▇-▇▇▇-▇▇▇▇), with a copy, in the case of any notice
pursuant to Section 8(c), to the Director of Litigation, Office of the
General Counsel, ▇▇▇▇▇▇ Brothers Inc., ▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇;
(b) if to the Transaction Entities shall be delivered or sent by
mail, telex or facsimile transmission to the Company, ▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (Fax:
(▇▇▇) ▇▇▇-▇▇▇▇);
PROVIDED, HOWEVER, that any notice to an Underwriter pursuant to
Section 10(c) shall be delivered or sent by mail, telex or facsimile
transmission to such Underwriter at its address set forth in its acceptance
telex to the Representatives, which address will be supplied to any other party
hereto by the Representatives upon request. Any such statements, requests,
notices or agreements shall take effect at the time of receipt thereof. The
Transaction Entities shall be entitled to act and rely upon any request,
consent, notice or agreement given or made on behalf of the Underwriters by
▇▇▇▇▇▇ Brothers Inc.
14. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall
inure to the benefit of and be binding upon the Underwriters, the Transaction
Entities, and their respective personal representatives and successors. This
Agreement and the terms and provisions hereof are for the sole benefit of only
those persons, except that (a) the representations, warranties, indemnities and
agreements of the Transaction Entities contained in this Agreement shall also be
deemed to be for the benefit of the person or persons, if any, who control any
Underwriter within the meaning of Section 15 of the Securities Act and (b) the
indemnity agreement of the Underwriters contained in Section 10(b) of this
Agreement shall be deemed to be for the benefit of directors of the Transaction
Entities, officers of the Company who have signed the Registration Statement and
any person controlling the Transaction Entities within the meaning of Section 15
of the Securities Act. Nothing in this Agreement is intended or shall be
construed to give any person, other than the persons referred to in this
Section 14, any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision contained herein.
15. SURVIVAL. The respective indemnities, representations,
warranties and agreements of the Transaction Entities, and the Underwriters
contained in this Agreement or made
41
by or on behalf on them, respectively, pursuant to this Agreement, shall survive
the delivery of and payment for the Shares and shall remain in full force and
effect, regardless of any investigation made by or on behalf of any of them or
any person controlling any of them.
16. DEFINITION OF THE TERMS "BUSINESS DAY" AND "SUBSIDIARY". For
purposes of this Agreement, (a) "business day" means any day on which the
New York Stock Exchange, Inc. is open for trading and (b) "subsidiary" has the
meaning set forth in Rule 405 of the Rules and Regulations.
17. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of New York.
18. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
19. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
42
If the foregoing correctly sets forth the agreement between the
Company and the Underwriters, please indicate your acceptance in the space
provided for that purpose below.
Very truly yours,
▇▇ ▇▇▇▇▇ REALTY CORP.
By: _________________________________________
Name:
Title:
▇▇ ▇▇▇▇▇ OPERATING PARTNERSHIP, L.P.
By: ▇▇ ▇▇▇▇▇ Realty Corp.,
its general partner
By:_____________________________________
Name:
Title:
▇▇ ▇▇▇▇▇ MANAGEMENT LLC
By: ▇▇ ▇▇▇▇▇ Operating Partnership, L.P.,
its managing member
By: _________________________________________
Name:
Title:
▇.▇. ▇▇▇▇▇ MANAGEMENT CORP.
43
By:_____________________________________
Name:
Title:
▇.▇. ▇▇▇▇▇ REALTY, INC.
By:_____________________________________
Name:
Title:
EMERALD CITY CONSTRUCTION CORP.
By:_____________________________________
Name:
Title:
Accepted:
▇▇▇▇▇▇ BROTHERS INC.
PRUDENTIAL SECURITIES INCORPORATED
BY: ▇▇▇▇▇▇ BROTHERS INC.
By:_____________________________________
Name:
Title:
For itself and as Representatives
of the several Underwriters named
in Schedule 1 hereto
44
Schedule 1
Number of
Underwriters Shares
------------ ---------
▇▇▇▇▇▇ Brothers Inc. . . . . . . . . . . . . . .
Prudential Securities Incorporated . . . . . . .
----------
Total 10,100,000
===========
S-1