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EXHIBIT 1.1
EQUITY OFFICE PROPERTIES TRUST
(A MARYLAND REAL ESTATE INVESTMENT TRUST)
4,000,000 8 5/8% SERIES C CUMULATIVE REDEEMABLE PREFERRED SHARES
OF BENEFICIAL INTEREST
(PAR VALUE $0.01 PER SHARE) (LIQUIDATION PREFERENCE $25.00 PER SHARE)
UNDERWRITING AGREEMENT
December 1, 1998
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December 1, 1998
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
PaineWebber Incorporated
Prudential Securities Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs and Mesdames:
Equity Office Properties Trust, a Maryland real estate investment trust
(the "Company"), proposes to issue and sell to the several Underwriters named in
Schedule I hereto (the "Underwriters") 4,000,000 of its 8 5/8% Series C
Cumulative Redeemable Preferred Shares of Beneficial Interest, par value $0.01
per share, liquidation preference $25.00 per share (the "Firm Shares"). The
Company also proposes to issue and sell to the several Underwriters not more
than an additional 600,000 of its 8 5/8% Series C Cumulative Redeemable
Preferred Shares of Beneficial Interest, par value $0.01 per share, liquidation
preference $25.00 per share (the "Additional Shares") if and to the extent that
you, as Managers of the offering, shall have determined to exercise, on behalf
of the Underwriters, the right to purchase such Additional Shares granted to the
Underwriters in Section 2 hereof. The Firm Shares and the Additional Shares are
hereinafter collectively referred to as the "Shares".
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 under the Securities Act of
1933, as amended (the "Securities Act") (No. 333-58729), including a prospectus,
relating, in part, to the Shares. Such registration statement (as amended),
including the information incorporated by reference therein, in the form in
which it became effective, is hereinafter collectively referred to as the
"Registration Statement"; and the base prospectus and prospectus supplement
relating to the Shares, including the information incorporated by reference
therein, in the form first delivered to the Underwriters for use in confirming
sales of Shares, is hereinafter collectively referred to as the "Prospectus".
The Company is the managing general partner of EOP Operating Limited
Partnership, a Delaware limited partnership (the "Operating Partnership"). The
Company owns all of its assets and conducts substantially all of its business
through the Operating Partnership and its subsidiaries.
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1. Representations and Warranties of the Company and the Operating
Partnership. The Company and the Operating Partnership represent and warrant,
jointly and severally, to the Underwriters, as of the date hereof, as of the
Closing Date (as defined below), and as of the Option Closing Date (as defined
below) (each, a "Representation Date"), as follows:
(a) Compliance with Registration Requirements. At the time the
Registration Statement became effective and at each Representation Date, the
Registration Statement (and any amendment thereto) complied, complies and will
comply in all material respects with the requirements of the Securities Act and
did not, does not and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading, and the Prospectus (and any amendment or
supplement thereto), at each Representation Date, complied, complies and will
comply in all material respects with the requirements of the Securities Act and
did not, does not and will not include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
provided, however, that the representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration Statement or
the Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any Underwriter through ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
Co. Incorporated expressly for use in the Registration Statement or the
Prospectus.
Each of the preliminary prospectus and the prospectus filed as part of
the Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act, complied when
so filed in all material respects with the Securities Act and each preliminary
prospectus and the prospectus delivered to the Underwriters for use in
connection with the offering of the Shares was identical to the electronically
transmitted copies thereof filed with the Commission pursuant ▇▇▇▇▇, except to
the extent permitted by Regulation S-T.
The documents incorporated or deemed to be incorporated by reference in
the Registration Statement and the Prospectus, at the time they were or
hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the Securities Exchange Act of 1934,
as amended (the "1934 Act"), and the rules and regulations of the Commission
thereunder.
(b) No Stop Order or Proceedings. No stop order suspending the
effectiveness of the Registration Statement or any part thereof has been issued
and no proceeding for that purpose has been instituted or, to the knowledge of
the Company, is contemplated by the Commission or by the state securities
authority of any jurisdiction. No order preventing or suspending the use of the
Prospectus has been issued and no proceeding for that purpose has been
instituted or, to the knowledge of the Company, is contemplated by the
Commission or by the state securities authority of any jurisdiction.
(c) Independent Accountants. Each of Ernst & Young LLP and
PricewaterhouseCoopers LLP, the accounting firms that certified the financial
statements and supporting schedules included in the Prospectus, is an
independent public accountant as required
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by the Securities Act and the applicable rules and regulations thereunder (the
"Securities Act Regulations").
(d) Financial Statements. The financial statements (including the notes
thereto) included in the Registration Statement and the Prospectus present
fairly the financial position of the respective entity or entities presented
therein at the respective dates indicated and the results of their operations
for the respective periods specified, and except as otherwise stated therein,
said financial statements have been prepared in conformity with generally
accepted accounting principles ("GAAP") applied on a consistent basis. The
supporting schedules included in the Registration Statement and the Prospectus
present fairly the information required to be stated therein. The financial
information and data included in the Registration Statement and the Prospectus
present fairly the information included therein and have been prepared on a
basis consistent with that of the books and records of the respective entities
presented therein. The Statements of Revenues and Certain Operating Expenses, if
any, included in the Registration Statement and the Prospectus for certain of
the Properties (as defined below) present fairly the information included
therein and have been prepared on a basis consistent with that of the books and
records of the respective entities presented therein. The pro forma financial
information included in the Registration Statement and the Prospectus has been
prepared in accordance with the applicable requirements of Rules 11-01 and 11-02
of Regulation S-X under the Securities Act, and the necessary pro forma
adjustments have been properly applied to the historical amounts in the
compilation of such information, and, in the opinion of the Company, the
assumptions used in the preparation thereof are reasonable and the adjustments
used therein are appropriate to give effect to the transactions and
circumstances referred to therein.
(e) No Material Adverse Change. Since the respective dates as of which
information is given in the Registration Statement and the Prospectus, except as
otherwise stated therein, (A) there has been no material adverse change in the
condition, financial or otherwise, or in the earnings, assets, or business
affairs of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business (a "Material Adverse
Change"), (B) no casualty loss or condemnation or other adverse event with
respect to any Property has occurred that would result in a Material Adverse
Effect (as defined below), (C) there have been no transactions or acquisitions
entered into by the Company or any of its subsidiaries, other than those arising
in the ordinary course of business, which are material with respect to the
Company and its subsidiaries considered as one enterprise, (D) except as
described in the Registration Statement and the Prospectus and except for
regular quarterly distributions of the Company (and corresponding distributions
of the Operating Partnership), there has been no distribution of any kind
declared, paid or made by the Company or the Operating Partnership with respect
to its partnership interests, and (E) there has been no material change in the
partnership interests of the Operating Partnership or any material increase in
the indebtedness of the Company.
(f) Good Standing of the Company. The Company has been duly formed and
is validly existing as a real estate investment trust in good standing under the
Maryland General Corporation Law (the "MGCL") with trust power and authority to
own, lease and operate any real property or improvements thereon owned or leased
by the Company or its subsidiaries (each, a "Property" and, collectively, the
"Properties"), to conduct the business in which it is engaged or proposes to
engage as described in the Registration Statement and the Prospectus and to
enter
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into and perform its obligations under or contemplated under this Agreement. The
Company is duly qualified or registered as a foreign real estate investment
trust and is in good standing in each jurisdiction in which such qualification
or registration is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to so qualify,
register or be in good standing would not result in a material adverse effect on
the condition, financial or otherwise, or the earnings, assets, business affairs
or business prospects of the Company and its subsidiaries considered as one
enterprise (a "Material Adverse Effect").
(g) Good Standing of the Subsidiaries. Each of the "significant
subsidiaries" of the Company listed on Schedule II to this Agreement
(collectively, the "Significant Subsidiaries") has been duly organized and is
validly existing as a partnership, corporation, limited liability company or
real estate investment trust in good standing under the laws of its respective
jurisdiction of organization, with all power and authority to own, lease and
operate its Properties, and to conduct the business in which it is engaged or
proposes to engage as described in the Registration Statement and the
Prospectus. Each Significant Subsidiary is duly qualified or registered as a
foreign partnership, corporation, limited liability company, or real estate
investment trust, and is in good standing in each jurisdiction in which the
business conducted by such subsidiary is required and permitted, whether by
reason of the ownership or leasing of property or the conduct of business,
except where the failure, singly or in the aggregate, to so qualify would not
result in a Material Adverse Effect. Each of the partnership or operating
agreements of the Significant Subsidiaries is in full force and effect.
(h) Capitalization of Company. The capitalization of the Company is as
set forth in the Registration Statement and the Prospectus as of the date
referenced therein. All of the Company's common and preferred shares of
beneficial interest outstanding at the date hereof were duly authorized for
issuance by the Company and are validly issued and fully paid. None of such
shares of beneficial interest were issued in violation of preemptive or other
similar rights of any security holder of the Company. Such outstanding shares of
beneficial interest were offered and sold in compliance with all applicable laws
(including, without limitation, federal and state securities laws).
(i) Authorization of the Shares. The Shares have been duly authorized
and classified for issuance and sale to the Underwriters pursuant to this
Agreement. At or prior to the Closing Date, the Company will have executed and
filed Articles Supplementary ("Articles Supplementary") to its Amendment and
Restatement of Declaration of Trust ("Declaration of Trust") establishing the
terms of the Shares with the State Department of Assessments and Taxation of
Maryland (the "SDAT") and, when the Shares are duly paid for and certificates
therefor are duly countersigned and delivered as provided herein, the Shares
will be validly issued, fully paid and nonassessable. The issuance of the Shares
is not subject to preemptive or similar rights. The Shares conform and will in
all material respects conform to the Articles Supplementary and the description
thereof contained in the Registration Statement and the Prospectus.
(j) Absence of Defaults. Neither the Company nor any Significant
Subsidiary is in violation of its declaration of trust, charter, by-laws,
limited liability company agreement, certificate of limited partnership or
partnership agreement, as the case may be, and neither the Company nor any of
its subsidiaries is in default in the performance or observance of
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any obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other instrument to which
such entity is a party or by which such entity may be bound, or to which any of
the property or assets of such entity is subject, except where a default
thereunder would not result in a Material Adverse Effect.
(k) Absence of Conflicts. The execution and delivery of this Agreement,
the performance of the obligations set forth herein, and the consummation of the
transactions contemplated hereby or in the Prospectus, including the issuance
and sale of the Shares to the Underwriters, by the Company and the Operating
Partnership will not result in the creation of any lien, charge or encumbrance
upon the Properties or conflict with or constitute a breach or violation by the
Company or any of its subsidiaries, or default under, (A) any material contract,
indenture, mortgage, loan agreement, note, lease, joint venture or partnership
agreement or other instrument or agreement to which such entity is a party or by
which they, any of them, any of their respective assets or any Property may be
bound or subject, (B) the declaration of trust, charter, by-laws, certificate of
limited partnership, partnership agreement, or limited liability company
agreement, as the case may be, of such entity or (C) any applicable law, rule,
order, administrative regulation or administrative or court decree, except in
the cases of clauses (A) and (C) for such liens, charges, encumbrances,
conflicts, breaches, violations or defaults as would not result in a Material
Adverse Effect.
(l) Authorization of Agreement. Each of the Company and the Operating
Partnership has the requisite power and authority under its organizational
documents to enter into this Agreement, and this Agreement has been duly
authorized, executed and delivered by each of the Company and the Operating
Partnership.
(m) Absence of Proceedings. There is no action, suit or proceeding
before or brought by any court or governmental agency or body, domestic or
foreign, now pending, or, to the knowledge of the Company, threatened against or
affecting the Company, any Significant Subsidiary, any Property or any officer
or trustee of the Company that, if determined adversely to the Company, any
Significant Subsidiary, any Property or any such officer or trustee, might (A)
result in any Material Adverse Effect or (B) materially and adversely affect the
consummation of the transactions contemplated by this Agreement. There are no
legal or governmental proceedings pending or, to the knowledge of the Company,
threatened to which the Company or any Significant Subsidiary is a party or to
which any of their respective assets, properties or operations is the subject
that are required to be described in the Registration Statement and the
Prospectus that are not so described. The aggregate of all pending legal or
governmental proceedings to which the Company or any subsidiary of the Company
is a party or of which any of their respective assets, properties or operations
is the subject which are not described in the Registration Statement and the
Prospectus, including ordinary routine litigation incidental to the business,
could not reasonably be expected to result in a Material Adverse Effect.
(n) Investment Company Act. Neither the Company nor any Significant
Subsidiary is, or as of the Closing Date or the Option Closing Date will be,
required to be registered under the Investment Company Act of 1940, as amended
(the "1940 Act").
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(o) Possession of Intellectual Property. The Company and its
subsidiaries own or possess, or can acquire on reasonable terms, the trademarks,
service marks, trade names, or other intellectual property (collectively,
"Intellectual Property") necessary to carry on the business now operated by
them, and no such entity has received any notice or is otherwise aware of any
infringement of or conflict with asserted rights of others with respect to any
Intellectual Property or of any facts or circumstances which would render
Intellectual Property invalid or inadequate to protect the interest of such
entities therein, and which infringement or conflict (if the subject of any
unfavorable decision, ruling or finding) or invalidity or inadequacy, singly or
in the aggregate, would result in a Material Adverse Effect.
(p) Absence of Further Requirements. All authorizations, approvals and
consents of any court or governmental authority or agency that are necessary in
connection with the offering, issuance or sale of the Shares hereunder or the
consummation of the other transactions contemplated by this Agreement have been
obtained, except such as may be required under the securities, blue sky or real
estate syndication laws of various states in connection with such offer,
issuance and sale.
(q) Possession of Licenses and Permits. The Company and its
subsidiaries possess such permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the appropriate
federal, state, or local regulatory agencies or bodies necessary to conduct the
business now conducted by them, or proposed to be conducted by them, as
described in the Registration Statement and the Prospectus, except where the
failure to possess any such Governmental Licenses would not have a Material
Adverse Effect. The Company and its subsidiaries are in compliance with the
terms and conditions of all such Governmental Licenses, except where the failure
so to comply would not, singly or in the aggregate, result in a Material Adverse
Effect. All of the Governmental Licenses are valid and in full force and effect,
except where the invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not result in a
Material Adverse Effect. Neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or modification of
any such Governmental Licenses which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would result in a Material
Adverse Effect.
(r) Absence of Labor Dispute. No labor dispute with the employees of
the Company or any of its subsidiaries exists or, to the knowledge of the
Company, is imminent, which may reasonably be expected to result in a Material
Adverse Effect.
(s) Title to Property. (A) With respect to the Properties in which the
Operating Partnership owns, directly or indirectly, all of the ownership
interests therein, the Operating Partnership or its subsidiaries have good and
marketable fee simple title to the land underlying such Properties (or, to the
extent described in the Registration Statement and the Prospectus, a valid
leasehold estate in such land) and (except for the Property known as "500
Orange") good and marketable title to the improvements thereon and all other
assets that are required for the effective operation of such Properties in the
manner in which they currently are operated, subject, however, to existing
mortgages on such Properties, to utility easements serving such Properties, to
liens of ad valorem taxes not due and payable as of the Closing Date (or which
are being contested pursuant to applicable law), to zoning and similar
governmental land use matters
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affecting such Properties that are consistent with (or, in the case of
grandfathered non-conforming uses, permit) the current uses of such Properties,
to matters of title not adversely affecting marketability of title to such
Properties, other statutory liens not due and payable as of the Closing Date,
title matters that may be material in character, amount or extent but which do
not materially detract from the value, or interfere with the use of, the
Properties or otherwise materially impair the business operations being
conducted or proposed to be conducted thereon, tenant leases, service marks and
trade names used in connection with such Properties, ground leases and ownership
by others of certain items of equipment and other items of personal property
that are not material to the conduct of business operations at such Properties;
(B) with respect to the Properties in which the Operating Partnership owns,
directly or indirectly, less than all of the ownership interest (the "Joint
Venture Properties"), the Company or its subsidiaries have good and marketable
title to such ownership interests and the respective entities owning the Joint
Venture Properties have good and marketable title to such interests in the Joint
Venture Properties and good and marketable title to the improvements thereon and
all other assets that are required for the effective operation of such
Properties in the manner in which they currently are operated, subject to the
exceptions set forth in clause (A) above; (C) except as disclosed in the
Registration Statement and the Prospectus or would not individually or in the
aggregate result in a Material Adverse Effect, the ground leases under which the
applicable subsidiaries of the Operating Partnership lease the land on which
certain Properties are located are in full force and effect, and each of such
subsidiaries is not in default in respect of any of the terms or provisions of
such leases and neither the Company nor any such subsidiary has received notice
of the assertion of any claim by anyone adverse to such subsidiaries' rights as
lessees under such leases, or affecting or questioning such subsidiaries' right
to the continued possession or use of the Property under such leases or of a
default under such leases; (D) all liens, charges, encumbrances, claims, or
restrictions on or affecting any of the Properties and the assets of the Company
or any of its subsidiaries are disclosed in the Registration Statement and the
Prospectus, subject to the exceptions set forth in clause (A) above; (E) neither
any subsidiary of the Company nor any tenant of any of the Properties is in
default under any of the leases pursuant to which the Operating Partnership or
any of its subsidiaries, as lessor, leases its Property (and the Company does
not know 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 leases) other than
such defaults and unmatured events of default that would not result in a
Material Adverse Effect; (F) except for such rights of first refusal as may be
contained in the agreements related to the Joint Venture Properties, no person
has an option or right of first refusal to purchase all or part of any Property
or any interest therein; (G) each of the Properties complies with all applicable
codes, laws and regulations (including, without limitation, building and zoning
codes, laws and regulations and laws relating to access to the Properties),
except if and to the extent disclosed in the Registration Statement and the
Prospectus and except for such failures to comply that would not individually or
in the aggregate result in a Material Adverse Effect; (H) there is in full force
and effect insurance coverage for the assets of the Properties that is
commercially reasonable for such types of assets, and neither the Company nor
any of its subsidiaries has received from any insurance company notice of any
material defects or deficiencies affecting the insurability of any such assets
(including the Properties); and (I) neither the Company nor any of its
subsidiaries has any knowledge of any pending or threatened condemnation
proceedings, zoning change, or other similar proceeding or action that will in
any manner affect the size of, use of, improvements on,
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construction on or access to the Properties, except such proceedings or actions
as are disclosed in the Registration Statement and the Prospectus or that would
not have a Material Adverse Effect.
(t) Environmental Laws. Except as disclosed in the Registration
Statement and the Prospectus or as would not have a Material Adverse Effect, (A)
each Property, including, without limitation, the Environment (as defined below)
associated with such Property, is free of any Hazardous Substance (as defined
below) in violation of any Environmental Law (as defined below) applicable to
such Property, except for Hazardous Substances that would not result in a
Material Adverse Effect; (B) neither the Company nor any of its subsidiaries has
during the period of its ownership caused or suffered to occur any Release (as
defined below) of any Hazardous Substance into the Environment on, in, under or
from any Property in violation of any Environmental Law applicable to such
Property, and no condition exists on, in, under or, to the knowledge of the
Company or any of its subsidiaries, adjacent to, any Property that could result
in the incurrence of material liabilities or any material violations of any
Environmental Law applicable to such Property, or give rise to the imposition of
any Lien (as defined below) under any Environmental Law; (C) neither the Company
nor any of its subsidiaries is engaged in or intends to engage in any
manufacturing at the Properties that (1) requires the use, handling,
transportation, storage, treatment or disposal of any Hazardous Substance (other
than cleaning solvents and similar materials and other than insecticides and
herbicides that are used in the ordinary course of operating the Properties and
in compliance with all applicable Environmental Laws) or (2) requires permits or
is otherwise regulated pursuant to any Environmental Law; (D) neither the
Company nor any of its subsidiaries has received any notice of a claim under or
pursuant to any Environmental Law applicable to a Property or under common law
pertaining to Hazardous Substances on or originating from any Property; (E)
neither the Company nor any of its subsidiaries has received any notice from any
Governmental Authority (as defined below) claiming any violation of any
Environmental Law that is uncured or unremediated as of the date hereof; (F) no
Property is included or, to the knowledge of the Company or any of its
subsidiaries, 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,
Compensation, and Liability Information System database maintained by the EPA,
and has not otherwise been identified by the EPA as a potential CERCLA removal,
remedial or response site or included or, to the knowledge of the Company or any
of its subsidiaries, proposed for inclusion on, any similar list of potentially
contaminated sites pursuant to any other applicable Environmental Law nor has
the Company or any of its subsidiaries received any written notice from the EPA
or any other Governmental Authority proposing the inclusion of any Property on
such list; and (G) there are no underground storage tanks located on or in any
Property which do not conform to all legal requirements in effect as of January
1, 1999 and which have not been disclosed to the Underwriters.
As used herein, the term "Hazardous Substance" shall include, without
limitation, any hazardous substance, hazardous waste, toxic or dangerous
substance, pollutant, solid waste or similarly designated materials, 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, including any such substance,
pollutant or waste identified or regulated under any Environmental Law
(including, without limitation, materials listed in the United States Department
of Transportation Optional Hazardous Material Table, 49 C.F.R.
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Section 172.101, as heretofore amended, or in the EPA's List of Hazardous
Substances and Reportable Quantities, 40 C.F.R. Part 302, as heretofore
amended); "Environment" shall mean any surface water, drinking water, ground
water, land surface, subsurface strata, river sediment, buildings, structures,
and ambient workplace and indoor 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, orders,
decisions and permits relating to the protection of the environment 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 or any release, emission,
discharge or similar term, as those terms are defined or used in any
Environmental Law.
(u) Tax Compliance. Each of the Company and its subsidiaries has filed
all federal, state, and local income tax returns which have been required to be
filed and has paid all taxes required to be paid and any other assessment, fine
or penalty levied against it, to the extent that any of the foregoing is due and
payable, except, in all cases, for any such tax, assessment, fine or penalty
that is being contested in good faith, and except in any case in which the
failure to so file or pay would not have a Material Adverse Effect.
(v) Taxation as an REIT. The Company has operated since its initial
public offering and intends to continue to operate in such a manner as to
qualify to be taxed as a "real estate investment trust" under the Internal
Revenue Code of 1986, as amended (the "Code").
(w) No Price Manipulation. Neither the Company nor any of its
Significant Subsidiaries, nor any of their trustees, directors, officers or
controlling persons, has taken or will take, directly or indirectly, any action
designed to cause or result under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), or otherwise in, or which has constituted or which
reasonably might be expected to constitute, the unlawful stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Shares.
(x) Plan Assets. The assets of the Company and its subsidiaries do not
constitute "plan assets" under the Employee Retirement Income Security Act of
1974, as amended, including the regulations and published interpretations
thereof.
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(y) Cross Defaults. The mortgages and deeds of trust encumbering the
properties and assets described in general in the Registration Statement and the
Prospectus are not convertible and are not cross-defaulted or
cross-collateralized to any property not owned by the Company or any of its
subsidiaries, and, except as disclosed in the Registration Statement and the
Prospectus, neither the Company nor any of its subsidiaries holds participating
interests in such mortgages and deeds of trust.
2. Agreements to Sell and Purchase. The Company hereby agrees to sell
to the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company the respective numbers of Firm Shares set forth in Schedule I hereto
opposite its name at $24.2125 per share (the "Purchase Price") plus accumulated
dividends, if any, to the Closing Date.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Underwriters the Additional Shares, and the Underwriters shall have a
one-time right to purchase, severally and not jointly, up to 600,000 Additional
Shares at the Purchase Price plus accumulated dividends, if any, to the Closing
Date. If you, on behalf of the Underwriters, elect to exercise such option, you
shall so notify the Company in writing not later than 30 days after the date of
this Agreement, which notice shall specify the number of Additional Shares to be
purchased by the Underwriters and the date on which such shares are to be
purchased. Such date may be the same as the Closing Date but not earlier than
the Closing Date nor later than ten business days after the date of such notice.
Additional Shares may be purchased as provided in Section 4 hereof solely for
the purpose of covering over-allotments made in connection with the offering of
the Firm Shares. If any Additional Shares are to be purchased, each Underwriter
agrees, severally and not jointly, to purchase the number of Additional Shares
(subject to such adjustments to eliminate fractional shares as you may
determine) that bears the same proportion to the total number of Additional
Shares to be purchased as the number of Firm Shares set forth in Schedule I
hereto opposite the name of such Underwriter bears to the total number of Firm
Shares.
The Company hereby agrees that, during the period beginning on the date
hereof and continuing to and including 30 days from the date hereof, it will
not, without the prior written consent of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, (i)
offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, lend or otherwise transfer or dispose of, directly or indirectly, any
Shares, any other equity securities of the Company which are substantially
similar to the Shares (other than any securities of the Company which are
convertible into common shares of beneficial interest of the Company) or any
securities convertible into or exercisable or exchangeable for Shares or any
other equity securities of the Company which are substantially similar to the
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Shares (other than any securities of the Company which are convertible into
common shares of beneficial interest of the Company) or (ii) enter into any swap
or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of any Shares, any other equity securities of
the Company which are substantially similar to the Shares (other than any
securities of the Company which are convertible into common shares of beneficial
interest of the Company) or any securities convertible into or exercisable or
exchangeable for Shares or any other equity securities of the Company which are
substantially similar to the Shares (other than any securities of the Company
which are convertible into common shares of beneficial interest of the Company),
whether any such transaction described in clause (i) or (ii) above is to be
settled by delivery of Shares, other securities, in cash or otherwise. The
restrictions described in the previous sentence do not apply to the sale of
Shares to the Underwriters.
3. Terms of Public Offering. The Company is advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable. The Company is further
advised by you that the Shares are to be offered to the public initially at
$25.00 per share (the "Public Offering Price") plus accumulated dividends, if
any, to the Closing Date and to certain dealers selected by you at a price that
represents a concession not in excess of $.50 per share under the Public
Offering Price, and that any Underwriter may allow, and such dealers may
reallow, a concession, not in excess of $.45 per share, to any Underwriter or to
certain other dealers.
4. Payment and Delivery. Payment for the Firm Shares shall be made to
the Company in Federal or other funds immediately available in New York City
against delivery of such Firm Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on December 8, 1998, or at such
other time on the same or such other date, not later than December 15, 1998, as
shall be designated in writing by you. The time and date of such payment are
hereinafter referred to as the "Closing Date".
Payment for any Additional Shares shall be made to the Company in
Federal or other funds immediately available in New York City against delivery
of such Additional Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on the date specified in the
notice described in Section 2 or on such other date, in any event not later than
January 22, 1999, as shall be designated in writing by you. The time and date of
such payment are hereinafter referred to as the "Option Closing Date".
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than one full business day prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the Purchase Price therefor.
5. Conditions to the Underwriters' Obligations. The obligations of the
Company to sell the Firm Shares to the Underwriters and the several obligations
of the Underwriters to purchase and pay for the Firm Shares on the Closing Date
are subject to the condition that the Registration Statement shall have been
declared effective prior to the date hereof, and no stop order suspending the
effectiveness of the Registration Statement or any part thereof has been issued
and no proceeding for that purpose has been instituted or, to the knowledge of
the Company, is contemplated by the Commission or by the state securities
authority of any jurisdiction. In addition, the price and other specific terms
of the Shares shall have been included in the Prospectus and the Prospectus
shall have been transmitted to the Commission for
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filing pursuant to Rule 424(b) of the Securities Act Regulations within the
prescribed time period, and prior to the Closing Date the Company shall have
provided evidence satisfactory to the Underwriters of such timely filing.
The several obligations of the Underwriters are subject to the
following further conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i.) there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not
indicate the direction of the possible change, in the rating
accorded any securities of the Company or the Operating
Partnership by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule
436(g)(2) under the Securities Act; and
(ii.) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, assets or business
affairs of the Company and its subsidiaries considered as one
enterprise from that set forth in the Prospectus (exclusive of
any amendments or supplements thereto subsequent to the date of
this Agreement) that, in your judgment, is material and adverse
and that makes it, in your judgment, impracticable to market the
Shares on the terms and in the manner contemplated in the
Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of the
Company, to the effect set forth in Section 5(a) above and to the effect that
the representations and warranties of the Company and the Operating Partnership
contained in this Agreement are true and correct as of the Closing Date and that
each of the Company and the Operating Partnership has complied with all of the
agreements and satisfied all of the conditions on their respective parts to be
performed or satisfied hereunder on or before the Closing Date.
The officer signing and delivering such certificate may rely upon the
best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an opinion
of ▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P., outside counsel for the Company, dated the Closing
Date, in form and substance satisfactory to you, to the effect that is set forth
in Exhibit A hereto. The opinion of ▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P. described in Section
5(c) above shall be rendered to the Underwriters at the request of the Company
and shall so state therein.
(d) The Underwriters shall have received on the Closing Date an opinion
of ▇▇▇▇▇ & Wood LLP, counsel for the Underwriters, dated the Closing Date,
covering the matters referred to in items (1) (first sentence only), (2) (first
sentence only), (4), (5), (8), (9) and (13) of Exhibit A hereto and a statement
similar to the statement referred to in clauses (i) and (ii) of the last
paragraph of Exhibit A hereto.
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(e) The Underwriters shall have received, on each of the date hereof
and on the Closing Date, a letter dated the date hereof or the Closing Date, as
the case may be, in form and substance satisfactory to the Underwriters, from
Ernst & Young LLP and PricewaterhouseCoopers L.L.P., independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in the
Registration Statement and the Prospectus; provided that the letter delivered on
the Closing Date shall use a "cut-off date" not earlier than the date hereof.
The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the delivery to you on the Option Closing Date
of such documents as you may reasonably request with respect to the good
standing of the Company, the due authorization and issuance of the Additional
Shares and other matters related to the issuance of the Additional Shares.
6. Covenants of the Company and the Operating Partnership. Each of the
Company and the Operating Partnership covenants with each Underwriter as
follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company will notify the Underwriters immediately, and confirm the notice in
writing, (i) when any post-effective amendment to the Registration Statement
shall become effective or any amendment or supplement to the Prospectus shall
have been filed, (ii) of the receipt of any comments from the Commission, (iii)
of any request by the Commission for any amendment to the Registration Statement
or any amendment or supplement to the Prospectus or for additional information,
and (iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any proceedings
for that purpose. The Company will make every reasonable effort to prevent the
issuance of any such stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give each Underwriter notice
of its intention to file or prepare any amendment to the Registration Statement
(including any post-effective amendment) or any amendment or supplement to the
Prospectus, will furnish the Underwriters with copies of any such amendment or
supplement a reasonable amount of time prior to such proposed filing or use, as
the case may be, and will not file any such amendment or supplement or use any
such prospectus to which the Underwriters or counsel for the Underwriters shall
reasonably object.
(c) Delivery of Registration Statements. The Company will deliver to
each Underwriter, as soon as available, one conformed copy of the Registration
Statement as originally filed and of each amendment thereto (including exhibits
filed therewith or incorporated by reference therein) and will also deliver to
the Underwriters as many conformed copies of the Registration Statement as
originally filed and of each amendment thereto (excluding exhibits) as the
Underwriters may reasonably request.
(d) Delivery of Prospectus. The Company will deliver to each
Underwriter, from time to time during the period when the Prospectus is required
to be delivered under the Securities Act
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or the Exchange Act, such number of copies of the Prospectus (as amended or
supplemented) as such Underwriter may reasonably request.
(e) Continued Compliance with Securities Laws. If any event shall occur
or condition exist as a result of which it is necessary, in the opinion of
counsel for the Underwriters, to amend or supplement the Prospectus in order to
make the Prospectus not include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements therein, in
the light of the circumstances existing at the time it is delivered to a
purchaser, not misleading, or in order to otherwise comply with the applicable
law, the Company will forthwith prepare an amendment of or supplement to the
Prospectus (in form and substance reasonably satisfactory to counsel for the
Underwriters) so that the Prospectus will not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances existing at the time it is
delivered to a purchaser, not misleading, or so that the Prospectus will comply
with applicable laws.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Shares for offering and sale
under the applicable securities laws and real estate syndication laws of such
states and other jurisdictions of the United States as the Underwriters may
designate; provided, however, that the Company shall not be obligated to (i)
file any general consent to service of process, (ii) qualify as a foreign
corporation in any jurisdiction in which it is not so qualified or (iii) take
any action that would subject it to income taxation in any such jurisdiction. In
each jurisdiction in which the Shares have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration Statement.
(g) Earnings Statement. The Company will file such reports pursuant to
the 1934 Act as are necessary in order to make generally available to its
security holders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the Securities Act.
(h) Use of Proceeds. The Company will use the net proceeds received by
it from the sale of the Shares in the manner specified in the Prospectus under
the caption "Use of Proceeds."
(i) Listing. The Company will use its best efforts to effect the
listing of the Shares on the NYSE.
(j) Filing of Prospectus. Following the execution of this Agreement,
the Company will prepare and file or transmit for filing with the Commission the
Prospectus in accordance with Rule 424(b) under the Securities Act.
(k) Price Stabilization or Manipulation. Except for the authorization
of actions permitted to be taken by the Underwriters as contemplated herein or
in the Prospectus, neither the Company nor the Operating Partnership will (i)
take, directly or indirectly, any action designed to cause or to result in, or
that might reasonably be expected to constitute, the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Shares, (ii) sell, bid for or purchase the Shares or pay any
person any compensation for soliciting
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purchases of the Shares or (iii) pay or agree to pay to any person any
compensation for soliciting another to purchase any other securities of the
Company.
(l) Reports to Representatives. During the period from the Closing Date
until five years after the Closing Date, the Company will deliver to ▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated, on behalf of the Underwriters, (i) promptly upon
their becoming available, copies of all current, regular and periodic reports of
the Company mailed to its shareholders or filed with any securities exchange or
with the Commission or any governmental authority succeeding to any of the
Commission's functions, and (ii) such other information concerning the Company
or any of its subsidiaries as ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, on behalf of
the Underwriters, may reasonably request.
(m) Accuracy of Representations. Prior to the Closing Date, the Company
and the Operating Partnership will notify ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, on
behalf of the Underwriters, in writing immediately if any event occurs that
renders any of the representations and warranties of the Company and the
Operating Partnership contained herein inaccurate or incomplete in any respect.
(n) Expenses. Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, the Company will pay
or cause to be paid all expenses incident to the performance of its obligations
under this Agreement, including: (i) the fees, disbursements and expenses of the
Company's counsel and the Company's accountants in connection with the
registration and delivery of the Shares under the Securities Act and all other
fees or expenses in connection with the preparation and filing of the
Registration Statement, any preliminary prospectus, the Prospectus and
amendments and supplements to any of the foregoing, including all printing costs
associated therewith, and the mailing and delivering of copies thereof to the
Underwriters and dealers, in the quantities hereinabove specified, (ii) all
costs and expenses related to the transfer and delivery of the Shares to the
Underwriters, including any transfer or other taxes payable thereon, (iii) the
cost of printing or producing any Blue Sky or Legal Investment memorandum in
connection with the offer and sale of the Shares under state securities laws and
all expenses in connection with the qualification of the Shares for offer and
sale under state securities laws as provided in Section 6(f) hereof, including
filing fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky or Legal Investment memorandum, (iv) all fees and expenses in
connection with the preparation and filing of the registration statement on Form
8-A relating to the Shares and all costs and expenses incident to listing the
Shares on the NYSE, (v) the cost of printing certificates representing the
Shares, (vi) the costs and charges of any transfer agent, registrar or
depositary, (vii) the costs and expenses of the Company relating to investor
presentations on any "road show" undertaken in connection with the marketing of
the offering of the Shares, including, without limitation, expenses associated
with the production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations with the
prior approval of the Company, travel and lodging expenses of the
representatives and officers of the Company and any such consultants, and the
cost of any aircraft chartered in connection with the road show, and (viii) all
other costs and expenses incident to the performance of the obligations of the
Company hereunder for which provision is not otherwise made in this Section. It
is understood, however, that except as provided in this Section, Section 7
entitled "Indemnity and Contribution", and the last paragraph
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of Section 9 below, the Underwriters will pay all of their costs and expenses,
including fees and disbursements of their counsel, stock transfer taxes payable
on resale of any of the Shares by them and any advertising expenses connected
with any offers they may make.
7. Indemnity and Contribution. (a) The Company and the Operating
Partnership, jointly and severally, agree to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act, from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably incurred
in connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement or any amendment thereto, any preliminary
prospectus or the Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto), or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages or liabilities are caused by any such
untrue statement or omission or alleged untrue statement or omission based upon
information relating to any Underwriter furnished to the Company in writing by
such Underwriter through ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated expressly for use
therein.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company and the Operating Partnership, and each person, if
any, who controls the Company or the Operating Partnership within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act, and
any trustee of the Company and any officer of the Company who signed the
Registration Statement, to the same extent as the foregoing indemnity from the
Company and the Operating Partnership to such Underwriter, but only with
reference to information relating to such Underwriter furnished to the Company
in writing by such Underwriter through ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
expressly for use in the Registration Statement or any amendment thereto, any
preliminary prospectus, the Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 7(a) or 7(b), such person (the "indemnified party")
shall promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for (a) the fees and expenses of more than
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one separate firm (in addition to any local counsel) for all such indemnified
parties and that all such fees and expenses shall be reimbursed as they are
incurred. Such firm shall be designated in writing by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated, in the case of parties indemnified pursuant to Section 7(a), and
by the Company, in the case of parties indemnified pursuant to Section 7(b). The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second and third sentences of this paragraph, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in Section 7(a) or
7(b) is unavailable to an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Operating Partnership on the one hand
and the Underwriters on the other hand from the offering of the Shares or (ii)
if the allocation provided by clause 7(d)(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 7(d)(i) above but also the relative
fault of the Company and the Operating Partnership on the one hand and of the
Underwriters on the other hand in connection with the statements or omissions
that resulted in such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations. The relative benefits received by the
Company and the Operating Partnership on the one hand and the Underwriters on
the other hand in connection with the offering of the Shares shall be deemed to
be in the same respective proportions as the net proceeds from the offering of
the Shares (before deducting expenses) received by the Company and the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover of the Prospectus, bear to the
aggregate Public Offering Price of the Shares. The relative fault of the Company
and the Operating Partnership on the one hand and the Underwriters on the other
hand shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
or the Operating Partnership or by the Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Underwriters' respective obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective number of Shares they have purchased hereunder, and not joint. For
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purposes of this Section 7, the Company and the Operating Partnership shall be
deemed one party and jointly and severally liable for any obligations under such
Section 7.
(e) The Company, the Operating Partnership and the Underwriters agree
that it would not be just or equitable if contribution pursuant to this Section
7 were determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation that does
not take account of the equitable considerations referred to in Section 7(d).
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, 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 7, 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 were
offered to the public exceeds the amount of any damages that such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The remedies provided for in this Section 7 are
not exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this Section
7 and the representations, warranties and other statements of the Company and
the Operating Partnership contained in this Agreement shall remain operative and
in full force and effect regardless of (i) any termination of this Agreement,
(ii) any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter or by or on behalf of the Company or the Operating
Partnership or any person controlling the Company or the Operating Partnership
or any trustee of the Company or any officer of the Company who signed the
Registration Statement and (iii) acceptance of and payment for any of the
Shares.
8. Termination. This Agreement shall be subject to termination by
notice given by you to the Company, if (a) after the execution and delivery of
this Agreement and prior to the Closing Date (i) trading generally shall have
been suspended or materially limited on or by, as the case may be, any of the
NYSE, the American Stock Exchange, the Nasdaq National Market, (ii) trading of
any securities of the Company or the Operating Partnership shall have been
suspended on any exchange or in any over-the-counter market, (iii) a general
moratorium on commercial banking activities in New York shall have been declared
by either Federal or New York State authorities or (iv) there shall have
occurred any outbreak or escalation of hostilities or any change in financial
markets or any calamity or crisis that, in your judgment, is material and
adverse and (b) in the case of any of the events specified in clauses 8(a)(i)
through 8(a)(iv), such event, singly or together with any other such event,
makes it, in your judgment, impracticable to market the Shares on the terms and
in the manner contemplated in the Prospectus.
9. Effectiveness; Defaulting Underwriters. This Agreement shall become
effective upon the execution and delivery hereof by the parties hereto.
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If, on the Closing Date or the Option Closing Date, as the case may be,
any one or more of the Underwriters shall fail or refuse to purchase Shares that
it has or they have agreed to purchase hereunder on such date, and the aggregate
number of Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Shares to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions that the number of Firm Shares set forth
opposite their respective names in Schedule I bears to the aggregate number of
Firm Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you may specify, to purchase the
Shares which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on such date; provided that in no event shall the number of
Shares that any Underwriter has agreed to purchase pursuant to this Agreement be
increased pursuant to this Section 9 by an amount in excess of one-ninth of such
number of Shares without the written consent of such Underwriter. If, on the
Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase
Firm Shares and the aggregate number of Firm Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Firm Shares to
be purchased, and arrangements satisfactory to you and the Company for the
purchase of such Firm Shares are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or the Company. In any such case, either you or the
Company shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. If, on the Option Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Additional Shares and the
aggregate number of Additional Shares with respect to which such default occurs
is more than one-tenth of the aggregate number of Additional Shares to be
purchased, the non-defaulting Underwriters shall have the option to (i)
terminate their obligation hereunder to purchase Additional Shares or (ii)
purchase not less than the number of Additional Shares that such non-defaulting
Underwriters would have been obligated to purchase in the absence of such
default. Any action taken under this paragraph shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
10. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
11. Applicable Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York.
20
21
12. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
EQUITY OFFICE PROPERTIES TRUST
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: President
EOP OPERATING LIMITED PARTNERSHIP
By: EQUITY OFFICE PROPERTIES TRUST
As its Managing General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: President
Accepted as of the date hereof
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
PaineWebber Incorporated
Prudential Securities Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
Acting severally on behalf of
themselves and as Representatives of
the several Underwriters named
in Schedule I hereto.
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
21
22
SCHEDULE I
Number of
Firm Shares
Underwriter To Be Purchased
----------- ---------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated 570,400
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated 570,400
PaineWebber Incorporated 570,400
Prudential Securities Incorporated 570,400
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. 570,400
ABN AMRO Incorporated 46,000
Bear, ▇▇▇▇▇▇▇ & Co. Inc. 46,000
BT Alex. ▇▇▇▇▇ Incorporated 46,000
CIBC ▇▇▇▇▇▇▇▇▇▇▇ Corp. 46,000
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. 46,000
▇▇▇▇▇▇▇, Sachs & Co. 46,000
▇▇▇▇▇▇▇▇ & Co. Inc. 46,000
▇▇ ▇▇▇▇▇ Securities Corporation 46,000
Advest, Inc. 20,000
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated 20,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C. 20,000
▇.▇. ▇▇▇▇▇▇▇▇ & Co. 20,000
Craigie Incorporated 20,000
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Co 20,000
▇.▇. ▇▇▇▇▇▇▇▇ & Co. Incorporated 20,000
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 20,000
▇▇▇▇▇▇▇▇▇ & Company LLC 20,000
▇▇▇▇▇▇▇▇▇▇ & Co., Inc. 20,000
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Inc. 20,000
Fidelity Capital Markets, A Division of National Financial Services Corp. 20,000
Fifth Third/The Ohio Company 20,000
First Albany Corporation 20,000
First of Michigan Corporation 20,000
Fleet Securities, Inc. 20,000
Gibraltar Securities Co. 20,000
J.J.B. ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, Inc. 20,000
Interstate/▇▇▇▇▇▇▇ Lane Corporation 20,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Inc. 20,000
23
▇▇▇▇▇▇▇▇▇▇▇, Pettis, Smith, Polian Inc. 20,000
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated 20,000
McDonald Investments Inc., A Keycorp Company 20,000
Mesirow Financial, Inc. 20,000
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc. 20,000
Olde Discount Corporation 20,000
Pershing/Division of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Corporation 20,000
▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc. 20,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc. 20,000
The ▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Company, LLC 20,000
▇▇▇▇▇ Capital Markets, a Division of First Chicago Capital Markets, Inc. 20,000
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co., Inc. 20,000
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, Inc. 20,000
Southwest Securities, Inc. 20,000
Sterne, Agee & ▇▇▇▇▇, Inc. 20,000
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Company, Incorporated 20,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Incorporated 20,000
Wedbush ▇▇▇▇▇▇ Securities 20,000
Wheat First Securities, Inc. 20,000
---------
Total .................................................. 4,000,000
=========
24
SCHEDULE II
Significant Subsidiaries
EOP Operating Limited Partnership
25
Exhibit A
(1) The Company has been duly formed as a real estate
investment trust under the Maryland REIT law and is existing in
good standing as of ______________ with the Maryland SDAT. The
Company has the trust power and trust authority under the
Maryland REIT Law and the Company's Declaration of Trust and the
Bylaws to own, lease and operate its properties and conduct its
business as described in the Registration Statement and the
Prospectus.
(2) The Operating Partnership is a limited partnership duly
formed and validly existing and in good standing under the laws
of the State of Delaware. The Operating Partnership has the
partnership power and partnership authority under its Agreement
of Limited Partnership and the Delaware Revised Uniform Limited
Partnership Act to own, lease and operate its current properties
and to conduct the business in which it is engaged or proposes to
engage as described in the Registration Statement and the
Prospectus. The Operating Partnership is qualified or registered
as a foreign limited partnership and is in good standing under
the laws of the states listed on Appendix A as of the respective
dates of the certificates received from such states. The Company
is the managing general partner of the Operating Partnership.
(3) The authorized, issued and outstanding capital shares of
the Company, as of September 30, 1998, is set forth under the
caption "Capitalization" in the Prospectus. All shares of
beneficial interest of the Company shown as issued and
outstanding under said caption are duly authorized and, assuming
the receipt of consideration therefor as provided in resolutions
of the Company's Board of Trustees authorizing issuances thereof,
are validly issued, fully paid and nonassessable. To our
knowledge, the Company has not issued any outstanding securities
convertible into or exchangeable for, or outstanding options,
warrants or other rights to purchase or subscribe for, any shares
of beneficial interest of the Company, except as described in the
Registration Statement and the Prospectus. No holder of
outstanding shares of beneficial interest of the Company has any
preemptive rights under the Maryland REIT Law or the Declaration
of Trust or the Bylaws of the Company or, to our knowledge, any
contractual right to subscribe for any of such shares.
(4) The Shares have been duly authorized by the Company for
issuance and sale pursuant to the Underwriting Agreement. When
issued and sold to the Underwriters in accordance with the
provisions of the Underwriting Agreement, the Shares will be
validly issued, fully paid and nonassessable under the Maryland
REIT Law. The form of share certificate evidencing the Shares
complies with the applicable
26
requirements of the Maryland REIT Law. The terms of the Shares
conform in all material respects to the description thereof set
forth in the Registration Statement and the Prospectus. The
issuance of the Shares is not subject to any preemptive rights
under the Maryland REIT Law or the Declaration of Trust or the
Bylaws of the Company or, to our knowledge, any contractual right
to subscribe for any Shares.
(5) The Underwriting Agreement has been duly authorized,
executed and delivered by the Company and the Operating
Partnership, and the Company has the trust power and trust
authority under the Maryland REIT Law and the Operating
Partnership has the partnership power and partnership authority
under the Delaware Revised Uniform Limited Partnership Act to
perform their respective obligations thereunder.
(6) The execution and delivery of the Underwriting Agreement
and the performance as of the date hereof by the Company and the
Operating Partnership of their respective obligations thereunder
and the consummation as of the date hereof of the transactions
contemplated thereby do not result in a violation of (i) in the
case of the Company, the Maryland REIT Law or its Declaration of
Trust or Bylaws, (ii) in the case of the Operating Partnership,
the Delaware Revised Uniform Limited Partnership Act, or its
Agreement of Limited Partnership, (iii) any agreement or contract
filed as an exhibit to the Company's Annual Report on Form 10-K
for the year ended December 31, 1997, as amended, or any other
reports filed subsequent to March 31, 1998 under the 1934 Act or
(iv) any applicable law, rule, regulation, order, judgment or
decree known to us of any Maryland or Delaware agency or court.
(7) The Articles Supplementary relating to the Shares have
been filed for record with the Maryland SDAT pursuant to the
Maryland REIT Law, and the number of and the title, par value,
liquidation preference, ranking, distribution rate, distribution
payment dates, redemption provisions and other terms of the
Shares have been set forth therein.
(8) The Registration Statement has become effective under
the Securities Act and, to our knowledge, no stop order
suspending the effectiveness of the Registration Statement or
suspending or preventing the use of the Prospectus has been
issued and no proceedings for that purpose have been instituted
or are threatened by the Commission.
(9) As of their respective effective or issue dates, the
Registration Statement (and any amendment thereto) and the
Prospectus (and any amendment or supplement thereto) (other than
the financial statements and schedules and other financial data
included therein or omitted therefrom as to which we express no
opinion) complied as to form
27
in all material respects with the requirements of the Securities
Act and the Securities Act Regulations.
(10) The documents incorporated or deemed incorporated by
reference in the Registration Statement and the Prospectus (other
than the financial statements and supporting schedules and other
financial information and data included therein), at the time
they were filed with the Commission, complied in all material
respects with the 1934 Act and the rules and regulations of the
Commission thereunder.
(11) Neither the Company nor the Operating Partnership is,
or upon consummation of the transactions contemplated by the
Underwriting Agreement will be, an "investment company", as
defined in the Investment Company Act of 1940, as amended.
(12) All filings with, or authorizations, approvals,
consents, licenses, orders, registrations, qualifications or
decrees of, the Securities and Exchange Commission or any
Maryland or Delaware State governmental body or agency in
connection with the offering, issuance or sale of the Shares
under the Underwriting Agreement or the performance as of the
date hereof by the Company and the Operating Partnership of their
respective obligations under the Underwriting Agreement have been
obtained, except such as may be required under state securities
or real estate syndication laws.
(13) The statements in the Prospectus under the captions
"Description of Series C Preferred Shares" and "Description of
Preferred Shares", to the extent that such information
constitutes matters of law or legal conclusions, has been
reviewed by us, and is correct in all material respects.
(14) The discussion in the Prospectus under the caption
"Federal Income Tax Consequences," to the extent that it
discusses matters of law or legal conclusions, is a correct
summary of the matters discussed therein as of the date hereof.
In giving its opinion, such counsel shall additionally state
that no facts have come to their attention which cause such
counsel to believe that (i) the Registration Statement or any
amendments thereto, as of their respective effective dates or as
of the date of the Underwriting Agreement, contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, (ii) the Prospectus, nor any amendments
or supplements thereto, as of their respective issue dates or as
of the Closing Date, included or includes an untrue statement of
a material fact or omitted or, omits to state a material fact
necessary in order to make the statements therein, in the light
of the circumstances under which they
28
were made, not misleading, (iii) there are any legal or
governmental proceedings pending or threatened against the
Company or any of its subsidiaries that are required to be
disclosed in the Registration Statement and the Prospectus, other
than those disclosed therein, or (iv) there are any contracts or
documents of a character required to be described in the
Registration Statement and the Prospectus that are not described
or referred to therein; provided that in making the foregoing
statements (which shall not constitute an opinion) such counsel
need not express any views as to the financial statements and
supporting schedules and other financial information and data
included in or omitted from the Registration Statement or the
Prospectus. In making the foregoing statement, such counsel may
state that such statement is based upon such counsel's
participation in conferences with officers and other
representatives of the Company, representatives of the
independent public accountants for the Company and with you and
your representatives during the course of the preparation of the
Registration Statement and the Prospectus.
