Up to 8,000,000 Shares WEINGARTEN REALTY INVESTORS Series G Depositary Shares PURCHASE AGREEMENT
EXHIBIT
10.1
Up
to 8,000,000 Shares
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REALTY INVESTORS
Series
G Depositary Shares
September
24, 2007
Wachovia
Investment Holdings, LLC
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Ladies
and Gentlemen:
▇▇▇▇▇▇▇▇▇▇
Realty Investors, a Texas real estate investment trust (the “Company”),
proposes to issue and sell to Wachovia Investment Holdings, LLC, a Delaware
limited liability company (the “Initial Purchaser”), up to 8,000,000
Series G Depositary Shares, liquidation preference $25.00 per share (the
“Shares” or the “Series G Depositary Shares”). Subject
to the terms and conditions, representations and warranties set forth in this
Purchase Agreement (this “Agreement”), Wachovia Investment Holdings, LLC
has agreed to act as the Initial Purchaser in connection with the potential
offering and sale of the Shares (as defined in Section
1(a)).
As
provided in Section 7 of this Agreement, if the
Company has not issued an irrevocable notice of redemption of the Shares by
August 25, 2008, the Company shall be obligated to deliver to the Initial
Purchaser by September 25, 2008 copies of an Offering Memorandum (the
“Offering Memorandum”) describing the Company and the terms of an
offering of the Shares. The Offering Memorandum shall be for the use
of the Initial Purchaser in connection with its solicitation of offers to
purchase the Shares, including purchases made pursuant to Rule 144A (“Rule
144A”) under the Securities Act of 1933, as amended (the “Securities
Act,” which term, as used in this Agreement, includes the rules and
regulations of the Securities and Exchange Commission (the “Commission”)
promulgated thereunder). As used in this Agreement, the term
“Offering Memorandum” shall mean, with respect to any date or time referred to
in this Agreement, any such Offering Memorandum, as amended or supplemented
through such date and the Incorporated Documents (as defined in Section 2(B)(f)) in the then-most-recent form
delivered by the Company to the Initial Purchaser in connection with its
solicitation of offers to purchase the Shares. Further, any reference
to the Offering Memorandum shall be deemed to refer to and include any
Additional Issuer Information (defined in Section
7(A)(a)) furnished by the Company prior to the completion of the Initial
Purchaser’s placement of the Shares to the Subsequent Purchasers (as defined
below).
As
provided in Section 7(A) of this Agreement, the
Company might become obligated to file with the Commission not later than
September 25, 2008, and have declared
effective
not later than October 27, 2008, a registration statement (the “Resale Shelf
Registration Statement”) registering the resale of the Shares under the
Securities Act by the holders, and the holders of the Shares might become
entitled to the benefits of a related registration rights agreement (the
“Registration Rights Agreement”) to be negotiated between the Company and
the Initial Purchaser.
All
references in this Agreement to financial statements and schedules and other
information which is “contained,” “included” or “stated” in the Offering
Memorandum (or other references of like import) shall be deemed also to refer
to
and include all such financial statements and schedules and other information
which are incorporated by reference in the Offering Memorandum; and all
references in this Agreement to amendments or supplements to the Offering
Memorandum shall be deemed to mean and include the filing of any document under
the Securities Exchange Act of 1934, as amended (the “Exchange Act,”
which term, as used in this Agreement, includes the rules and regulations
of the
Commission promulgated thereunder), which is incorporated by reference in the
Offering Memorandum.
The
Shares are being offered and sold to the Initial Purchaser without being
registered with the Commission under the Securities Act, in reliance upon the
Section 4(2) private placement exemption therefrom. The Company
understands that, at any time on or after March 25, 2008, the Initial Purchaser
might, but is under no obligation to, make an offering of the Shares on the
terms and in the manner set forth in this Agreement and agrees that from and
after such date the Initial Purchaser may resell, subject to the conditions
set
forth in this Agreement, all or a portion of the Shares to purchasers as
described in this Agreement (the “Subsequent Purchasers”). In
that case, the Shares may be offered and sold to the Subsequent Purchasers
without being registered with the Commission under the Securities Act in
reliance upon exemptions therefrom, including sales to “qualified institutional
buyers” under Rule 144A, or in transactions not subject
thereto. Further, the Company understands that, with respect to an
offering of Shares at any time on or after March 25, 2008, the Initial Purchaser
shall be permitted to transfer without restriction the Shares to Wachovia
Capital Markets, LLC, or another affiliate for the purposes of offering such
Shares. From and after any such transfer, references herein to the
“Initial Purchaser” shall be deemed to refer to the Initial Purchaser and/or the
Initial Purchaser’s transferee as applicable.
The
Company hereby confirms its agreement with the Initial Purchaser as
follows:
Section
1. Purchase,
Sale and Delivery of the Shares.
(a) Purchase
and Sale. On the basis of the representations, warranties and
agreements contained in this Agreement, and upon the terms but subject to the
conditions set forth in this Agreement, the Initial Purchaser shall purchase
from the Company, and the Company shall sell to the Initial Purchaser, 8,000,000
Series G Depositary Shares (the “Shares”) each representing 1/100 of an
Adjustable Rate Series G Cumulative Redeemable Preferred Share of the Company
(the “Series G Preferred Shares”) pursuant to a Deposit Agreement in form
and substance satisfactory to the Initial Purchaser (the “Deposit
Agreement”) on the Closing Date (as defined in Section 1(c)(i) of this
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Agreement),
for the consideration specified in Section
1(b). On or before the Closing (as defined in Section 1(b)), the Company shall file with the County
Clerk of ▇▇▇▇▇▇ County, Texas, the Statement of Designation in the form attached
hereto as Exhibit A (except for any changes proposed by the Company as
are approved by the Initial Purchaser in its sole and absolute discretion)
(the
“Statement”).
(b) Payment
of Purchase Price and Delivery of Shares. The purchase and sale
of the Shares contemplated by this Agreement shall take place as set forth
in
Section 1(b)(i).
(i) At
the closing (the “Closing”)
on the Closing Date (as defined below), in addition to the other deliveries
required by this Agreement, (x) the Initial Purchaser shall pay to the Company,
by wire transfer of immediately available funds, $200,000,000.00 (the
“Purchase Price”), and (ii) the Company shall deposit with Mellon
Investor Services, LLC, as depositary (the “Depositary”), a certificate
representing 80,000 Series G Preferred Shares and shall deliver to the Initial
Purchaser Series G Depositary Receipts (the “Depositary Receipts”)
evidencing 8,000,000 Shares, registered in the name of Wachovia Investment
Holdings, LLC or such other name(s) as the Initial Purchaser shall have
specified no less than two business days prior to the Closing.
(c) Closing
Date.
(i) The
Closing shall take place at the
offices of ▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, Dallas, Texas, on September 25, 2007
at 9:00 a.m. Dallas, Texas time, or such other date and time as is mutually
agreeable to the Company and the Initial Purchaser (the “Closing
Date”).
(d) Fee.
(i) At
the Closing, the Company shall pay
the Initial Purchaser by wire transfer of immediately available funds a fee
equal to $6,300,000.00, which fee shall be paid other than from the proceeds
of
the sale of the Shares.
(e) Restriction
on Transfer of Shares.
(i) Basic
Restriction. Until March 25, 2008, the Initial Purchaser shall
not transfer any of the Shares without the prior written approval of the
Company, which approval may be withheld in the Company’s sole and absolute
discretion. Thereafter, the Initial Purchaser may transfer any or all
of the Shares without any approval from the Company, subject to the requirements
of Rule 144A and any other applicable securities laws.
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(ii) REIT-Related
Transfer Restrictions. The Initial Purchaser acknowledges that
Article XVIII of the Company’s Restated Declaration of Trust (the “Declaration”)
prohibits certain transfers of Shares in order to preserve the Company’s status
as a real estate investment trust (“REIT”) under the Internal
Revenue Code of 1986, as amended (the “Code”), and that the Company
intends to disclose such transfer restrictions in the Offering
Memorandum.
Section
2. Representations
and Warranties.
(A) Representations
and Warranties of the Initial Purchaser. The Initial Purchaser
represents and warrants to and agrees with the Company as of the date hereof
and
as of the Closing Date as follows:
(a) Organization
of the Initial Purchaser. The Initial Purchaser has been
incorporated and is validly existing as a limited liability company in good
standing under the laws of Delaware.
(b) Authorization
of Transaction. The Initial Purchaser has, and at the Closing
Date will have, full entity power to execute and deliver this Agreement and
to
perform its obligations hereunder. This Agreement constitutes the
valid and legally binding obligation of the Initial Purchaser, enforceable
in
accordance with its terms and conditions, subject to (i) the effect of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
other similar laws now or hereafter in effect relating to or affecting the
rights and remedies of creditors and (ii) the effect of general principles
of
equity, whether enforcement is considered in a proceeding in equity or at law,
and the discretion of the court before which any proceeding therefor may be
brought. The Initial Purchaser need not give any notice to, make any
filing with, or obtain any authorization, consent, or approval of any government
or governmental agency in order to consummate the transactions contemplated
by
this Agreement, except for such as have been obtained and except for such as
would not materially impede the transactions contemplated by this
Agreement.
(c) Noncontravention. Neither
the execution and the delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, will violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
restriction of any government, governmental agency, or court to which the
Initial Purchaser is subject or any provision of its organizational documents,
except for such violations as would not materially impede the transactions
contemplated by this Agreement.
(d) Disclosure
of Information. The Initial Purchaser represents that it and its
representatives have (i) had an opportunity to ask questions and receive answers
from the Company regarding the terms and conditions of the sale of the Shares
and the business, properties, prospects and financial condition of the
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Company
and (ii) reviewed copies of the SEC Filings (as defined in Section 2(B)(d)).
(e) Investment
Experience. The Initial Purchaser has substantial experience as
a purchaser of shares of companies similar to the Company and acknowledges
that
it is able to fend for itself, can bear the economic risk of its investment
and
could afford a complete loss of such investment, and has such knowledge and
experience in financial or business matters that it is capable of evaluating
the
merits and risks of the investment in the Shares. The Initial
Purchaser acknowledges that in purchasing the Shares it must be prepared to
continue to bear the economic risk of such investment for an indefinite period
of time because (i) the Shares have not been registered under the Securities
Act
and cannot be sold unless they are subsequently registered under the Securities
Act and applicable state securities laws, or unless exemptions from such
registrations are available, and (ii) the Shares are subject to the restrictions
on transfer set forth in Section 1(e) above and in
Article XVIII of the Declaration.
(f) Initial
Purchaser as Qualified Institutional Buyer. The Initial
Purchaser represents and warrants to the Company that it is a “qualified
institutional buyer” within the meaning of Rule 144A under the Securities Act (a
“Qualified Institutional Buyer”) and an “accredited investor” within the
meaning of Rule 501(a) under the Securities Act (an “Accredited
Investor”).
(g) Restricted
Shares. The Initial Purchaser understands that the Shares are
characterized as “restricted shares” under the federal securities laws inasmuch
as they are being acquired from the Company in a transaction not involving
a
public offering and that under such laws and applicable regulations such shares
may be resold without registration under the Securities Act only in certain
limited circumstances.
(h) Legends. It
is understood that the certificates evidencing the Shares shall initially bear
substantially the following legend (in addition to any legend otherwise required
under applicable federal or state securities laws):
“THE
SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES
LAWS OF ANY STATE, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED UNLESS AND UNTIL REGISTERED IN THE ABSENCE OF SUCH REGISTRATION
OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM OR NOT SUBJECT TO SUCH REGISTRATION
REQUIREMENTS.
THE
HOLDER OF THIS SECURITY, BY ITS ACQUISITION HEREOF, AGREES THAT IT WILL NOT,
PRIOR TO THE DATE THAT IS TWO YEARS AFTER THE LATER OF THE
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ORIGINAL
ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF
THE
COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY),
RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY EXCEPT (a) TO THE
COMPANY; (b) TO A PERSON THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER, AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT (A “QIB”),
IN COMPLIANCE WITH RULE 144A, (c) PURSUANT TO THE EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE AND
ON
THE UNDERSTANDING THAT THE COMPANY MAY REQUIRE AN OPINION OF COUNSEL BEFORE
REGISTERING ANY SUCH TRANSFER ON ITS SHARE TRANSFER RECORDS), (d) PURSUANT
TO A
SECURITIES ACT REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE AND
THAT
CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER, OR (e) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION, IF ANY, FROM SUCH REGISTRATION REQUIREMENTS OR
IN A
TRANSACTION NOT SUBJECT TO SUCH REGISTRATION REQUIREMENTS; AND AGREES THAT
IT
SHALL DELIVER TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.”
(B) Representations
and Warranties of the Company. The Company represents and warrants to
and agrees with the Initial Purchaser as of the date hereof and as of the
Closing Date (it being understood that such representations, warranties and
agreements at the Closing Date shall be deemed to relate to the SEC Filings
as
amended or supplemented to such time) as follows:
(a) No
Registration Required. Subject to compliance by the Initial
Purchaser with the representations and warranties set forth in Section 2(A)(e) and (f)
and Section 8 of this Agreement and with the
procedures set forth in Section 8 of this Agreement,
it is not necessary in connection with the offer, sale and delivery of the
Shares to the Initial Purchaser and to each Subsequent Purchaser in the manner
contemplated by this Agreement to register the Shares under the Securities
Act.
(b) No
Integration of Offerings or General Solicitation. The Company
has not, directly or indirectly, solicited any offer to buy or offered to sell,
and will not, directly or indirectly, solicit any offer to buy or offer to
sell,
in the United States or to any United States citizen or resident, any security
which is or would be integrated with the sale of the Shares in a manner that
would require the Shares to be registered under the Securities
Act. None of the Company, its affiliates (as
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such
term
is defined in Rule 501(b) under the Securities Act (each, an
“Affiliate”), or any person acting on its or any of their behalf (other
than the Initial Purchaser, as to whom the Company makes no representation
or
warranty) has engaged or will engage, in connection with the offering of the
Shares, in any form of general solicitation or general advertising within the
meaning of Rule 502(c) under the Securities Act with respect to the Shares,
other than maintaining the effectiveness of the Company’s current shelf
registration statements.
(c) Eligibility
for Resale. The Shares are eligible for resale pursuant to Rule
144A and are not of the same class as shares listed on a national securities
exchange registered under Section 6 of the Exchange Act or quoted in a United
States automated interdealer quotation system or shares of an open-end
investment company, unit investment trust or face-amount certificate company
that is or is required to be registered under Section 8 of the Investment
Company Act of 1940 (the “Investment Company Act,” which term, as used in
this Agreement, includes the rules and regulations of the Commission promulgated
thereunder).
(d) SEC
Filings. The Annual Report of the Company on Form 10-K for the
year ended December 31, 2006 filed by the Company with the Commission (including
the portions of the Company’s proxy statement incorporated by reference therein)
as supplemented by each Quarterly Report of the Company on Form 10-Q, each
Current Report of the Company on Form 8-K filed or to be filed by the Company
with the Commission since January 1, 2007, but not including any Current Reports
on Form 8-K furnished to the Commission pursuant to Item 7.01 or Item 2.02
(or
any comparable provisions adopted by the Commission) of Form 8-K (collectively,
the “SEC Filings”), do not include an untrue statement of any 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.
(e) The
Offering Memorandum. If delivered by the Company to the Initial
Purchaser, the Offering Memorandum shall not, on the date of its delivery or
thereafter through the completion of the Initial Purchaser’s placement of the
Shares, 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 this representation, warranty and
agreement shall not apply to any statements in, or omissions from, the Offering
Memorandum made in reliance upon and in conformity with information furnished
in
writing to the Company by the Initial Purchaser expressly for inclusion in
the
Offering Memorandum or any amendment or supplement thereto. The
Company has not distributed and will not distribute, prior to the earlier of
the
Redemption Date (as defined in the Statement) and the completion of the Initial
Purchaser’s placement of the Shares, any offering material in connection with
the offering and sale of the Shares other than the Offering
Memorandum.
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(f) Incorporated
Documents. If delivered by the Company to the Initial Purchaser,
the Offering Memorandum shall incorporate by reference those filings by the
Company pursuant to the Exchange Act that would be permitted to be incorporated
by reference in a Registration Statement on Form S-3 filed by the Company
pursuant to the Securities Act. Any documents that are incorporated
or deemed to be incorporated by reference in the Offering Memorandum at the
time
they were or hereafter are filed with the Commission (collectively, the
“Incorporated Documents”) complied and will comply in all material
respects with the requirements of the Exchange Act and, when read together
with
the other information in the Offering Memorandum, do not and will not include
an
untrue statement of a material fact or omit to state a material fact required
to
be stated therein or necessary to make the statements therein, in the light
of
the circumstances under which they were made, not misleading. The
foregoing representation and warranties in this Section
2(B)(f) shall not apply to any statements or omissions made in reliance on
and in conformity with information relating to the Initial Purchaser furnished
in writing to the Company by the Initial Purchaser expressly for inclusion
in
the Offering Memorandum or any amendment or supplement thereto;
(g) The
Company is a real estate investment trust duly formed and validly existing
under
the laws of the State of Texas, with full power and authority to own, lease
and
operate its properties and to conduct its business as described in the SEC
Filings; the Company is duly qualified to transact business and is in good
standing in each other jurisdiction in which it owns or leases properties,
or
conducts any business, so as to require such qualification, or is subject to
no
material liability or disability by reason of the failure to be so qualified
in
any such jurisdiction, and holds all authorizations, approvals, orders,
licenses, certificates and permits from all governmental authorities which
are
material to the conduct of its business.
(h) Each
subsidiary of the Company has been duly formed and is validly existing as a
corporation, trust, partnership, limited partnership or limited liability
company, as the case may be, in good standing under the laws of the jurisdiction
of its formation, has full power and authority to own, lease and operate its
properties and to conduct its business as described in the SEC Filings and
is
duly qualified to transact business and is in good standing in each jurisdiction
in which such qualification is required, whether by reason of the ownership
or
leasing of property or the conduct of business, except where the failure to
so
qualify would not have a material adverse effect or a prospective material
adverse effect, on the condition, financial or otherwise, or the earnings or
business affairs of the Company and its subsidiaries considered as one
enterprise; all of the issued and outstanding capital stock or other ownership
interests of each such subsidiary has been duly authorized and validly issued,
is fully paid and non-assessable and is owned by the Company, directly or
through subsidiaries, free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity.
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(i) Neither
the Company nor any of its subsidiaries has sustained since the date of the
latest audited financial statements included or incorporated by reference in
the
SEC Filings 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, otherwise
than as set forth or contemplated in the SEC Filings; and, since the respective
dates as of which information is given in the SEC Filings, there has not been
any change in the consolidated capital shares of the Company (except for
issuances of the Company’s common shares of beneficial interest pursuant to the
Company’s employee benefit and shares option plans, the Company’s Dividend
Reinvestment and Share Purchase Plan and exchanges of operating partnership
units) or any material change in the consolidated debt of the Company or any
of
its subsidiaries or any material decrease in consolidated net current assets
or
net assets or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position, shareholders’ equity or results of operations of
the Company and its subsidiaries, otherwise than as set forth or contemplated
in
the SEC Filings, and there has been no material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business.
(j) This
Agreement has been duly and validly authorized, executed and delivered by the
Company.
(k) The
Company has an authorized capitalization as set forth in or incorporated by
reference in the SEC Filings, and all of the issued capital shares of the
Company have been duly and validly authorized and issued and are fully paid
and
non-assessable.
(l) The
Series G Preferred Shares and the Shares have been duly and validly authorized,
and, when the Series G Preferred Shares are issued and delivered pursuant to
this Agreement, and when the Series G Preferred Shares have been deposited
by
the Company with the Depositary in accordance with the provisions of the Deposit
Agreement, and the Depositary Receipts have been issued and delivered by the
Depositary and paid for by the Initial Purchaser pursuant to this Agreement,
such Series G Preferred Shares will be duly and validly issued and fully paid
and non-assessable.
(m) If
applicable, upon execution and delivery thereof pursuant to the terms of the
Deposit Agreement, the persons in whose names the Depositary Receipts are
registered will be entitled to the rights specified therein and in the Deposit
Agreement, subject to (i) the effect of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar laws now or hereafter
in
effect relating to or affecting the rights and remedies of creditors and (ii)
the effect of general principles of equity, whether enforcement is considered
in
a
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proceeding
in equity or at law, and the discretion of the court before which any proceeding
therefor may be brought.
(n) The
issue
and sale of the Series G Preferred Shares and the compliance by the Company
with
all of the provisions of this Agreement and the Deposit Agreement, and the
consummation of the transactions herein and therein contemplated 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 indenture, mortgage, deed
of
trust, loan agreement or other agreement or instrument to which the Company
or
any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, nor will such action result in any
violation of the provisions of the declaration of trust or by-laws of the
Company or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of
its
subsidiaries or any of their respective properties; and no consent, approval,
authorization, order, registration or qualification of or with any such court
or
governmental agency or body is required for the issue and sale of the Series
G
Preferred Shares or the consummation by the Company of the transactions
contemplated by this Agreement or the Deposit Agreement, except such as have
been, or will have been prior to the Closing Date, obtained under the Securities
Act.
(o) Neither
the Company nor any of its subsidiaries is in violation of its declaration
of
trust, charter or other governing instrument, as applicable, or by-laws or
in
default in the performance or observance of any material obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of trust,
loan
agreement, lease or other agreement or instrument to which it is a party or
by
which it or its properties may be bound.
(p) Other
than as set forth in the SEC Filings, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is a party
or of which any property of the Company or any of its subsidiaries is the
subject which, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a material adverse
effect on the current or future consolidated financial position, shareholders’
equity or results of operations of the Company and its subsidiaries; and, to
the
best of the Company’s knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others.
(q) The
consolidated financial statements together with related notes and schedules
as
set forth or incorporated by reference in the SEC Filings present fairly the
financial position and the results of operations of the Company and its
subsidiaries at the indicated dates and for the indicated
periods. Except as otherwise stated in the SEC Filings, such
financial statements have been prepared in accordance with generally accepted
accounting principles, applied on a consistent basis; and the supporting
schedules included in the SEC Filings present fairly the information required
to
be stated therein.
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(r) The
Company and its subsidiaries have good and marketable title to all real property
and interests in its real property and good and marketable title to all its
personal property, in each case free and clear of all pledges, liens,
encumbrances, claims, security interests and defects, except as are described
in
the SEC Filings and except for property owned in the joint ventures,
partnerships and bankruptcy-remote subsidiaries set forth in Exhibit B
hereto or such as do not materially affect the value of such property and
interests in the aggregate and do not interfere with the use made and proposed
to be made of such property and interests by the Company and its subsidiaries
taken as a whole; in the case of real property and interests in real property,
the Company and its subsidiaries have obtained satisfactory confirmation
(consisting of policies of title insurance or binders therefor or opinions
of
counsel based upon the examination of abstracts) confirming, except as is
otherwise described in the SEC Filings, (a) that the Company and its
subsidiaries have the foregoing title to such real property and interests in
real property; provided, however, that in those cases in which such information
is not current, the Company and its subsidiaries do not have notice of any
material claim of any sort which has been asserted by anyone adverse to the
Company’s or its subsidiaries challenging the Company’s or its subsidiaries’
title to such real property and interests in real property, and (b) that the
instruments securing the indebtedness of third parties to the Company or its
subsidiaries create valid liens upon the real properties described in such
instruments enjoying the priorities intended, subject only to exceptions to
title which have no materially adverse effect on the value of such real
properties and interests; and any real property and buildings held under lease
by the Company or its subsidiaries or leased by the Company or its subsidiaries
to a third party are held or leased by them under valid, binding and enforceable
leases conforming to the description thereof set forth in the SEC Filings,
with
such exceptions as are not material and do not interfere with the use made
and
proposed to be made of such property and buildings by the Company or its
subsidiaries or such third party.
(s) The
Company and its subsidiaries have filed all federal, state, local and foreign
income tax returns which have been required to be filed on or before the due
date (taking into account all extensions of time to file) and have paid or
provided for all taxes indicated by said returns and all assessments received
by
them to the extent that taxes have become due.
(t) With
respect to all tax periods regarding which the Internal Revenue Service is
or
will be entitled to assert any claim, the Company has met the requirements
for
qualification as a real estate investment trust under Sections 856 through
860
of the Internal Revenue Code of 1986, as amended (the “Code”), and the Company’s
present and contemplated operations, assets and income continue to meet such
requirements.
(u) The
Company is not and, after giving effect to the offering and sale of the Series
G
Preferred Shares, will not be an “investment company” or an entity “controlled”
by an “investment company,” as such terms are defined in the Investment Company
Act.
-11-
(v) Deloitte
& Touche llp (the “Accountants”), who have audited certain financial
statements of the Company and its subsidiaries filed with the Commission as
part
of, or incorporated by reference in, the SEC Filings, and have audited the
Company’s internal control over financial reporting and management’s assessment
thereof are independent public accountants as required by the Securities Act
and
the rules and regulations of the Commission promulgated thereunder and the
Public Company Accounting Oversight Board (United States).
(w) Although
the Company is aware of the presence of hazardous substances, hazardous
materials, toxic substances or waste materials (“Hazardous Materials”) on
certain of its properties, nothing has come to the attention of the Company
which, at this time, would lead the Company to believe that the presence of
such
Hazardous Materials, when considered in the aggregate, would materially and
adversely affect the financial condition of the Company. In
connection with the construction on or operation and use of the properties
owned
or leased by the Company or any of its subsidiaries, the Company represents
that, as of the date of this Agreement, it has no knowledge of any material
failure by the Company or any of its subsidiaries to comply with all applicable
local, state and federal environmental laws, regulations, ordinances and
administrative and judicial orders relating to the generation, recycling, reuse,
sale, storage, handling, transport and disposal of any Hazardous
Materials.
(x) The
Company and its subsidiaries carry or are entitled to the benefits of insurance,
with financially sound and reputable insurers, in such amounts and covering
such
risks as is generally maintained by companies of established repute engaged
in
the same or similar business, and all such insurance is in full force and
effect.
(y) The
Company has established and maintains “disclosure controls and procedures” (as
such term is defined in Rules 13a-15 and 15d-15 under the Exchange Act) that
(A)
are designed to ensure that material information relating to the Company,
including its subsidiaries, is made known to the Company’s Chief Executive
Officer and its Chief Financial Officer by others within those entities,
particularly during the periods in which the filings made by the Company with
the Commission which it may make under Section 13(a), 13(c), 14 or 15(d) of
the
Exchange Act are being prepared, (B) have been evaluated by the Chief Executive
Officer and Chief Financial Officer for effectiveness as of a date within 90
days prior to the filing of the Company’s most recent annual report filed with
the Commission, and (C) are effective to perform the functions for which they
were established. The Company’s independent accountants and the audit
committee of the board of trust managers of the Company have been advised of
(x)
any significant deficiencies in the design or operation of internal controls
which could adversely affect the Company’s ability to record, process,
summarize, and report financial data and (y) any fraud, whether or not material,
that involves management or other employees who have a role in the Company’s
internal controls. Any material weaknesses in internal controls has
been
-12-
identified
for the Company’s independent accountants. Since the date of the most
recent evaluation of such disclosure controls and procedures, there have been
no
significant changes in internal controls or in other factors that could
significantly affect internal controls, including any corrective actions with
regard to significant deficiencies and material weaknesses.
(z) No
Limits on Redemption of Shares. The redemption by the Company of
the Shares in accordance with the Declaration would not constitute a breach
or
violation of, or a default under, or conflict with, or give any other party
a
right to terminate any of its obligations under, or result in the acceleration
of any obligation under, or result in the creation or imposition of any lien,
charge or encumbrance upon any assets of the Company or any of its subsidiaries
pursuant to the terms or provisions of the Declaration or Bylaws of the Company,
the declaration or certificate of incorporation or bylaws or partnership
agreement or operating agreement of any of the subsidiaries or any material
contract, lease or other instrument to which the Company or any of the
subsidiaries is a party or by which any of their property may be bound or any
judgment, ruling, decree, order, law, statute, rule or regulation of any court
or other governmental agency or body applicable to the business or properties
of
the Company or any of the subsidiaries.
(aa) Certificates
and Documents. Any certificate or other document signed by any
officer or authorized representative of the Company or any subsidiary, and
delivered to the Initial Purchaser or to counsel for the Initial Purchaser
in
connection with the sale of the Shares shall be deemed a representation and
warranty by such entity, as the case may be, to the Initial Purchaser as to
the
matters covered thereby.
(bb) No
Brokers. There are no contracts, agreements or understandings
between the Company or any of its subsidiaries and any person that would give
rise to a valid claim against the Company or the Initial Purchaser for a
brokerage commission, finder’s fee or other like payment in connection with the
offering, issuance and sale of the Shares, other than the fee payable to the
Initial Purchaser pursuant to this Agreement.
Section
3. Additional
Covenants of the Company. The Company further covenants and agrees
with the Initial Purchaser as follows:
(a) Future
Reports to the Initial Purchaser. For so long as the Shares are
outstanding and are held by the Initial Purchaser, the Company shall furnish
to
Wachovia Investment Holdings, LLC at the address set forth below as soon as
available, copies of any report or communication of the Company mailed generally
to holders of its capital shares or debt instruments, except for any such
reports or communications available through the Commission’s ▇▇▇▇▇
system.
(b) No
Integration. The Company agrees that it shall not make any offer
or sale of securities if, as a result of the doctrine of “integration” referred
to in Rule 502 under the Securities Act, such offer or sale would render
unavailable
-13-
(for
the
purpose of (i) the sale of the Shares by the Company to the Initial Purchaser
or
(ii) the resale of the Shares by the Initial Purchaser to Subsequent Purchasers)
the exemption from the registration requirements of the Securities Act provided
by Section 4(2) thereof, including the provisions of Regulation D under the
Securities Act, or by Rule 144A thereunder or otherwise.
(c) Due
Diligence. In connection with the original placement of the
Shares, from the date hereof to the Closing Date, the Company agrees that the
Initial Purchaser and counsel for the Initial Purchaser shall have the right
to
make reasonable inquiries into the business of the Company, and the Company
also
agrees to provide answers to such inquiries (to the extent that such information
is available or can be acquired and made available without extraordinary effort
or expense and to the extent the provision thereof is not prohibited by
applicable law).
(d) Investment
Company Act. The Company agrees to take such steps as shall be
necessary to ensure that neither the Company nor any subsidiary shall become
an
“investment company” within the meaning of such term under the Investment
Company Act.
(e) Payment
of Company Expenses. The Company agrees to pay all costs, fees
and expenses incurred in connection with the performance of its obligations
under this Agreement and in connection with the transactions contemplated by
this Agreement and by the Offering Memorandum, including, without limitation,
(i) all expenses incident to the issuance and delivery of the Shares (including
all printing and engraving costs), (ii) all fees and expenses of the registrar
and transfer agent of the Shares, (iii) all necessary issue, transfer and other
stamp taxes in connection with the issuance and sale of the Shares to the
Initial Purchaser, (iv) all fees and expenses of the Company’s counsel,
independent public or certified public accountants and other advisors, (v)
all
costs and expenses incurred in connection with the preparation, printing,
filing, shipping and distribution of the Offering Memorandum (including
financial statements), and all amendments and supplements thereto, (vi) all
filing fees, attorneys’ fees and expenses reasonably incurred by the Company or
the Initial Purchaser in connection with qualifying or registering (or obtaining
exemptions from the qualification or registration of) all or any part of the
Shares for offer and sale or placement, as the case may be, under the Blue
Sky
laws and, if requested by the Initial Purchaser, preparing and printing a “Blue
Sky Survey” or memorandum, and any supplements thereto, provided that
in the case of the Initial Purchaser, such filing fees, attorneys’ fees and
expenses shall not exceed $10,000, and (vii) the fees payable in connection
with
the inclusion of the Shares in The PORTAL Market (as hereinafter
defined). Except as provided in this Section
3(e), Section 6 and Section 9 of this Agreement,
the Initial Purchaser
shall pay its own expenses.
(f) Registration
Rights Agreement. Unless the Shares have been redeemed, no later
than September 25, 2008, the Company shall authorize the
-14-
execution,
delivery and performance of the Registration Rights Agreement (including
provisions for Registration Default liquidated damages similar to those set
forth in Section 7(A)(e) of this
Agreement).
(g) No
Limits on Redemption of Shares. The Company will not, and will
cause its subsidiaries not to, amend the Declaration or Bylaws of the Company,
the declaration of trust or certificate of incorporation or bylaws or
partnership agreement or operating agreement of any of the subsidiaries or
amend
or enter into any contract, lease or other instrument or suffer to exist any
judgment, ruling, decree, or order of any court or other governmental agency
or
body applicable to the Company or any of its subsidiaries that would prohibit
or
restrict in any material manner the ability of the Company to redeem the
Shares.
The
Initial Purchaser may, in its sole discretion, but shall not be required to,
waive in writing the performance by the Company of any one or more of the
foregoing covenants or extend the time for their performance.
Section
4. Appointment
of Wachovia Investment Holdings, LLC, as Initial Dividend Rate Calculation
Agent. The initial Dividend Rate Calculation Agent under the
Statement of Designation for the Company is appointed as follows:
(a) Appointment
of Calculation Agent. Upon the terms and subject to the
conditions set forth in this Section 4, effective
from and after each Closing, the Company hereby appoints Wachovia Investment
Holdings, LLC as its Dividend Rate Calculation Agent under the Statement (in
such capacity, the “Calculation Agent”), and Wachovia Investment
Holdings, LLC hereby accepts such appointment.
(b) Duties
of Calculation Agent. In acting under this Section 4, the Calculation Agent shall be obligated
to
perform only such duties as are set forth specifically herein and in the
Statement as duties of the Dividend Rate Calculation Agent. In acting
under this Agreement, the Calculation Agent (in its capacity as such) assumes
no
obligation towards, or any relationship of agency or trust for or with, the
holders of the Shares.
(c) Expenses. The
Company shall reimburse the Calculation Agent for all reasonable expenses,
disbursements and advances incurred or made by the Calculation Agent in
connection with the services rendered by it as Calculation Agent under this
Agreement (including reasonable legal fees and expenses) upon receiving an
accounting therefor from the Calculation Agent; provided,
however, until March 25, 2008, the Calculation Agent shall pay its expenses
incurred in its role as Calculation Agent.
(d) Rights
and Liabilities of Calculation Agent. The Calculation Agent
shall incur no liability for, or in respect of, any action taken, omitted to
be
taken or suffered by it in reliance upon any certificate, affidavit,
instruction, notice, request, direction, order, statement or other paper,
document or
-15-
communication
reasonably believed by it to be genuine and correct. Any certificate,
affidavit, instruction, notice, request, direction, order, statement or other
paper, document or communication from the Company made or given by it and sent,
delivered or directed to the Calculation Agent under, pursuant to or as
permitted by any provision of this Agreement shall be sufficient for purposes
of
this Agreement if such communication is in writing and signed by any officer
of
the Company. The Calculation Agent may consult with counsel
satisfactory to it and, as to legal matters, the opinion of such
counsel shall constitute full and complete authorization and protection of
the
Calculation Agent with respect to any action taken, omitted to be taken or
suffered by it hereunder in good faith and in accordance with and in reliance
upon the opinion of such counsel.
(e) Right
of Calculation Agent to Own Shares. The Calculation Agent may
act as Calculation Agent and it and its officers, employees and shareholders
may
become owners of, or acquire any interest in, Series G Preferred Shares, with
the same rights as if the Calculation Agent were not the Calculation Agent,
and
may engage in, or have an interest in, any financial or other transaction with
the Company or any of its affiliates as if the Calculation Agent were not the
Calculation Agent hereunder.
(f) Termination,
Resignation or Removal of Calculation Agent. Wachovia Investment
Holdings, LLC may at any time terminate its agreement to act as Calculation
Agent by giving no less than 90 days’ written notice to the Company (which
notice shall specify the date or event upon which such termination is to become
effective) unless (i) the Company consents in writing to a shorter time or
(ii)
such termination is in connection with the sale of the Shares to a party not
affiliated with the Initial Purchaser, in which case only 30 days’ prior written
notice shall be required. The Company may terminate its appointment
of Wachovia Investment Holdings, LLC as Calculation Agent at any time by giving
written notice to Wachovia Investment Holdings, LLC and specifying the date
on
which the termination shall become effective; provided,
however, that no termination by the Calculation Agent or by the Company
shall become effective prior to the date of the appointment of a successor
Calculation Agent by the Company as provided in Section
4(g) hereof and the acceptance of such appointment by such successor
Calculation Agent. Upon the receipt of written notice from Wachovia
Investment Holdings, LLC that it will terminate its agreement to act as
Calculation Agent, the Company shall use its reasonable best efforts to appoint
a successor Calculation Agent within fifteen (15) days. If an
instrument of acceptance by a successor Calculation Agent shall not have been
delivered to the resigning or terminated Calculation Agent within 30 days after
the giving of such notice of resignation and the Company shall not have informed
the Calculation Agent that it does not intend to appoint a successor Calculation
Agent, the resigning Calculation Agent may petition any court of competent
jurisdiction for the appointment of a successor Calculation
Agent. Upon termination by either party pursuant to the provisions of
this Section 4(f), the Calculation Agent with
respect to which this Agreement has been terminated shall be entitled to the
reimbursement of all reasonable expenses, disbursements and
-16-
advances
incurred in connection with the services rendered by it hereunder, as provided
by Section 4(c) hereof.
(g) Appointment
of Successor Calculation Agent. Any successor Calculation Agent
appointed by the Company shall execute and deliver to the Calculation Agent
and
to the Company an instrument accepting such appointment, and thereupon such
successor Calculation Agent shall, without any further act or instrument, become
vested with all the rights, immunities, duties and obligations of the
Calculation Agent, with like effect as if originally named as Calculation Agent
hereunder, and the Calculation Agent shall thereupon be obligated to transfer
and deliver, and such successor Calculation Agent shall be entitled to receive
and accept copies of any available records maintained by the Calculation Agent
in connection with the performance of its obligations hereunder.
(h) Indemnification. The
Company shall indemnify and hold harmless the Calculation Agent and its officers
and employees from and against all actions claims, damages, liabilities, losses
and expenses (including reasonable legal fees and expenses) relating to or
arising out of actions or omissions in its capacity as Calculation Agent, except
actions, claims, damages, liabilities, losses and expenses caused by the gross
negligence or willful misconduct of the Calculation Agent or its officers or
employees. The indemnification provided by this Section 4(g) shall survive the redemption or exchange
of the Shares and the termination of this Agreement. The Company will
not be liable for any settlement of any action or claim effected without its
written consent.
(i) Merger,
Consolidation or Sale of Business by Calculation Agent. Any
corporation into which the Calculation Agent may be merged, converted or
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Calculation Agent may be a party, or any corporation
to which the Calculation Agent may sell or otherwise transfer all or
substantially all of its corporate trust business shall, to the extent permitted
by applicable law, become the Calculation Agent under this Agreement without
the
execution of any document or any further act by the parties hereto.
(j) Consequential
Damages. In no event shall the Calculation Agent be liable for
special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits), even if the Calculation Agent
has
been advised of the likelihood of such loss or damage and regardless of the
form
of action.
Section
5. Conditions
to Closing
(A) Conditions
to the Obligations of the Initial Purchaser. The obligations of the
Initial Purchaser to purchase and pay for the Shares as provided in this
Agreement on the Closing Date shall be subject to the accuracy of the
representations and warranties on the part of the Company as of the date of
this
Agreement and the Closing Date, as though then made, and to
-17-
the
timely performance by the Company of its covenants and other obligations under
this Agreement to be performed at or prior to such date, and to each of the
following additional conditions:
(a) Opinions
of Company Counsel. On the Closing Date, the Initial Purchaser
shall have received the opinion of ▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇ PLLC, securities and
tax counsel for the Company, dated the Closing Date, in form and substance
satisfactory to the Initial Purchaser.
(b) Company
Certificate. On the Closing Date the Initial Purchaser shall
have received from the Company a certificate, dated the date of its delivery,
signed by two officers of the Company holding the offices of (x) Chief Executive
Officer and (y) Chief Financial Officer, or superior officers, in form and
substance satisfactory to the Initial Purchaser, to the effect
that:
(i) Either
no request for information
regarding the Shares or this private placement on the part of the staff of
the
Commission or any state “Blue Sky” authorities has been received, or if any such
request has been received, it has been complied with to the satisfaction of
the
staff of the Commission or such authorities;
(ii) Each
signer of such certificate has carefully examined the SEC Filings and, as of
the
date of such certificate, the SEC Filings do not contain any untrue statement
of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
in which they were made, not misleading. All documents required to be
filed under the Exchange Act since January 1, 2007 have been filed as
required;
(iii) Each
of
the representations and warranties of the Company contained in this Agreement
was, when originally made, and is, at the time such certificate is delivered,
true and correct;
(iv) Each
of
the covenants required to be performed by the Company herein on or prior to
the
delivery of such certificate has been duly, timely and fully performed in all
material respects, and each condition herein required to be complied with by
the
Company on or prior to the date of such certificate has been duly, timely and
fully complied with;
(v) Except
as
set forth in the SEC Filings, as contemplated by this Agreement and the
transactions referred to herein and as relating to or resulting from the
issuance of the Company’s Series G Preferred Shares for the period from and
after the date of this Agreement through the date of such certificate, (A)
the
Company and its subsidiaries, taken as a whole, have not incurred
-18-
any
liabilities or obligations, direct or contingent, or entered into any
transactions (other than, in each case, in the ordinary course of business
consistent with past practice), that are material to the Company and its
subsidiaries, taken as a whole, (B) there has not been any material change
in the shares of beneficial interest, total debt of the Company and
(C) there has not been any material adverse change, or any development
involving a prospective material adverse change, in the financial condition,
business, prospects, net worth or results of operations of the Company and
its
subsidiaries, taken as a whole.
(c) Other
Documents. At the Closing, counsel to the Initial Purchaser
shall have been furnished with such other documents as such counsel may
reasonably require in order to evidence the accuracy and completeness of any
of
the representations and warranties, or the fulfillment of any of the conditions,
contained in this Agreement; and all proceedings taken by the Company in
connection with the issuance and sale of the Shares as contemplated in this
Agreement shall be satisfactory in form and substance to the Initial Purchaser
and to counsel to the Initial Purchaser.
(d) No
Unmet Commission Requests. Any request for additional
information on the part of the staff of the Commission or any state securities
authorities regarding the Shares or this private placement shall have been
complied with to the satisfaction of the staff of the Commission or such
authorities.
(e) No
Material Adverse Change. Except as set forth in the SEC Filings,
as contemplated by this Agreement and the transactions referred to herein and
as
relating to or resulting from the issuance of the Company’s Series G Preferred
Shares since the date of this Agreement, (i) the Company and its subsidiaries,
taken as a whole, shall not have incurred any liabilities or obligations, direct
or contingent, or entered into any transactions (other than, in each case,
in
the ordinary course of business consistent with past practice), that are
material to the Company and its subsidiaries taken as a whole, and (ii) there
shall not have occurred any material change in the shares of beneficial
interest, total debt of the Company, (iii) there shall not have occurred any
material adverse change, or any development involving a prospective material
adverse change, in the financial condition, business, prospects, net worth
or
results of operations of the Company and its subsidiaries, taken as a whole,
and
(iv) neither the Company nor any of its subsidiaries shall have sustained any
material loss or interference with its business or properties from fire,
explosion, flood or other casualty not covered by insurance if, in the
reasonable judgment of the Initial Purchaser, any such loss or interference
causes a material adverse effect.
(f) No
Material Litigation Commenced. Since the respective dates as of
which information is given in the SEC Filings, there shall have been no
litigation or other proceeding instituted against the Company or any of its
-19-
subsidiaries
or any of their respective officers, directors or trust managers in their
capacities as such, before or by any Federal, state or local court, commission,
regulatory body, administrative agency or other governmental body, domestic
or
foreign, in which litigation or proceeding an unfavorable ruling, decision
or
finding would be reasonably expected to result in a material adverse
effect.
All
such
opinions, certificates, letters and other documents will be in compliance with
the provisions hereof only if they are reasonably satisfactory in form and
substance to the Initial Purchaser and its counsel. If any condition
specified in this Section 5(A) shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Initial Purchaser by notice to the Company at any time, and any such
termination shall be without liability of any party to any other party, except
that the indemnity and contribution agreements set forth in Section 4(h) and Section
9 hereof, the provisions concerning payment of expenses under Section 3(e), and Section 6
and the provisions relating to governing law shall remain in
effect.
(B) Conditions
to the Obligations of the Company.
(a) The
obligations of the Company to sell the Shares as provided in this Agreement
on
the Closing Date shall be subject to the accuracy of the representations and
warranties on the part of the Initial Purchaser as of the date of this Agreement
and as of such Closing Date, as though then made, and to the timely performance
by the Initial Purchaser of its covenants and other obligations under this
Agreement to be performed at or prior to such date, and to the condition that
there shall not be any injunction, judgment, order, decree, ruling or charge
in
effect preventing, or any litigation seeking to prevent or interfere with,
the
consummation of any of the transactions contemplated by this
Agreement.
(b) If
any
condition specified in this Section 5(B) shall not
have been fulfilled when and as required to be fulfilled, this Agreement may
be
terminated by the Company by notice to the Initial Purchaser at any time and
any
such termination shall be without liability of any party to any other party,
except that the indemnity and contribution agreements set forth in Section 4(h) and Section
9 hereof, the provisions concerning payment of expenses under Section 3(e) and Section 6
and the provisions relating to governing law shall remain in
effect.
Section
6. Reimbursement
of Initial Purchaser’s Expenses. The Company agrees to pay the
reasonable fees and expenses of counsel to the Initial Purchaser in connection
with all of the transactions contemplated herein. In addition, if the
sale to the Initial Purchaser of the Shares on the Closing Date is not
consummated because of any refusal, inability or failure on the part of the
Company to perform any agreement herein or to comply with any provision of
this
Agreement, the Company agrees to reimburse the Initial Purchaser upon demand
for
all reasonable out-of-pocket expenses that shall have been incurred by the
Initial Purchaser in connection with the proposed purchase and the offering
and
sale of the Shares to have been delivered at such Closing Date, including,
but
not limited to, fees and disbursements of advisors, travel expenses, postage,
facsimile and telephone charges.
-20-
Section
7. Contingent
Obligations of the Company if the Company Fails to Issue a Redemption Notice
for
the Shares by August 25, 2008. If by 5:00 p.m. New York time on
August 25, 2008 the Company has not delivered to the Initial Purchaser an
irrevocable notice of redemption of all of the Shares with a Redemption Date
on
or before September 25, 2008, then the Company shall be obligated as set forth
below in this Section 7; provided,
however, that each and every such obligation shall terminate upon the
redemption of all the Series G Preferred Shares by the Company; provided
further, however, that such termination shall not relieve the
Company from any liability for damages suffered by the Initial Purchaser as
a
result of any breach of such obligations by the Company prior to such
termination. Time shall be of the essence with respect to the
Company’s compliance with the deadlines set forth in this Section 7.
(A) Creating
a Marketable Security.
(a) Additional
Issuer Information. In order to render the Shares eligible for
resale pursuant to Rule 144A under the Securities Act for the benefit of holders
and beneficial owners from time to time of the Shares, the Company shall furnish
at its expense upon request, while any of the Shares remain outstanding, to
any
holder of Shares or prospective purchasers of Shares the information specified
in Rule 144A(d)(4) (such information, whether made available to holders or
prospective purchasers or furnished to the Commission, is herein referred to
as
“Additional Issuer Information”), unless the Company is then subject to
Section 13 or 15(d) of the Exchange Act or exempt from reporting pursuant to
Rule 12g3-2(b) of the Exchange Act.
(b) Offering
Memorandum. The Company shall prepare an Offering Memorandum of
the sort customary in Rule 144A offerings (including all disclosures required
by
Rule 144A) for use by the Initial Purchaser in connection with resale of the
Shares to Subsequent Purchasers, which shall be in final form no later than
September 25, 2008. The Offering Memorandum shall also disclose the
REIT-related transfer limitations referred to in Section
1(e) of this Agreement and other restrictions on transfer contained in the
Declaration. The Company agrees to furnish to the Initial Purchaser,
without charge, as many copies of the Offering Memorandum and any amendments
and
supplements thereto as the Initial Purchaser shall reasonably request from
time
to time for use in connection with resales of the Shares.
(c) Resale
Shelf Registration Statement. If the Shares have not been
redeemed, the Company shall, no later than September 25, 2008, file with the
Commission the Resale Shelf Registration Statement, including a prospectus
for
use by the holders of the Shares, as selling shareholders of their Shares,
and
shall use its reasonable best efforts to have the Resale Shelf Registration
Statement and a companion Form 8-A registration statement, if any, for the
Shares declared effective no later October 27, 2008 and thereafter to keep
such
registrations continuously effective with respect to the Shares other than
(i) Shares that have been exchanged or disposed of pursuant to the Resale
Shelf Registration Statement, (ii) Shares that are eligible to be sold
pursuant to Rule 144(k) (or any similar provision then in force, but not Rule
144A) under the Securities Act and
-21-
(iii)
Shares that have ceased to be outstanding. To the extent they are
eligible, the Company shall use its reasonable best efforts to list the Shares
on the New York Stock Exchange (“NYSE”) commencing upon the effective
date of such Form 8-A.
(d) Registration
Rights Agreement. The Company shall in good faith negotiate with
the Initial Purchaser and no later than September 25, 2008 shall sign the
Registration Rights Agreement for the benefit of the holders of the Shares
from
time to time. The Registration Rights Agreement may provide
additional terms regarding the Resale Shelf Registration
Statement. The Registration Rights Agreement shall require the
Company, upon the request of 20% in interest of the holders of the Shares,
to
file a demand registration statement (the “Demand Registration Statement”
and, together with the Resale Registration Statement, the “Registration
Statements”) in connection with an underwritten offering of the Shares,
provided that the Company shall not be required to file more than one
such demand registration. In such underwritten offering, the Company
and the Initial Purchaser shall cause its officers, attorneys and auditors
to
supply customary certificates, opinions and comfort letters at the
closing. The Registration Rights Agreement shall include customary
indemnification and contribution agreements by each the Company and the Initial
Purchaser for the benefit of each other under both Registration
Statements.
(e) Liquidated
Damages. If the Shares have not been redeemed and (i) the Resale
Shelf Registration Statement has not been filed with the Commission by September
25, 2008, (ii) by October 27, 2008 such Resale Shelf Registration Statement
has
not been declared effective by the Commission, or (iii) after the Resale Shelf
Registration Statement has been declared effective, it ceases to be effective
or
otherwise becomes unusable by the holders of Shares who are selling shareholders
thereunder for any reason, and the aggregate number of calendar days in any
consecutive twelve (12) month period for which the Resale Shelf Registration
Statement shall not be usable exceeds 30 days in the aggregate (each such event
referred to in clauses (i) through (iii), inclusive, a “Registration
Default”), a cash payment which the Company acknowledges shall constitute
liquidated damages for any such Registration Default (a “Default
Payment”) shall be payable quarterly in arrears on each Dividend Payment
Date (as defined in the Statement) to all record holders of the Shares other
than (i) shares that have been exchanged or disposed of pursuant to the
Resale Shelf Registration Statement, (ii) Shares that are eligible to be
sold pursuant to Rule 144(k) (or any similar provision then in force, but not
Rule 144A) under the Securities Act and (iii) Shares that have ceased to
be outstanding (in addition to any regular distribution accruing or payable
on
such Shares) and will accrue beginning on (and including) the date on which
any
such Registration Default shall occur and ending on (but excluding) the date
on
which all Registration Defaults have been cured. Default Payments
shall accrue at a rate of $0.25 (equivalent to 1.00% of the $25.00 liquidation
preference) per annum per Share. The Company shall cause the Default
Payments to be paid on the regular Dividend Payment Date, whether or
-22-
not
the
Company shall have declared a dividend or other distribution on the Shares
for
such quarter.
The
parties to this Agreement agree that the record holders of the Shares may suffer
damages in the event that a Registration Default has occurred and is continuing,
and that it would not be possible to ascertain the amount of such
damages. The parties to this Agreement further agree that the Default
Payments shall be liquidated damages provided for in this Section 7(A)(e) of this Agreement and constitute a
reasonable estimate of the damages that may be incurred by the holders by reason
of a Registration Default.
(f) DTC
Eligibility. No later than September 25, 2008, the Company shall
cause the Shares to be eligible for clearance and settlement through the
facilities of The Depository Trust Company, including, if necessary and to
the
extent appropriate for a security intended to be traded under Rule 144A and
to
the extent allowed by applicable law, removal of the legends referred to in
Section 2(A)(h).
(g) PORTAL
Market Inclusion. Upon the request of the Initial Purchaser, the
Company shall use its reasonable best efforts to cause the Shares to be eligible
for trading in the Private Offering, Resales and Trading through Automated
Linkages Market of the National Association of Securities Dealers, Inc. (the
“PORTAL Market”).
(h) Ratings. The
Company shall use its commercially reasonable efforts to cause the Rating
Agencies to issue ratings with respect to the Shares not later than September
25, 2008, or as soon thereafter as practicable.
(i) Initial
Purchaser’s Review of Final Offering Memorandum and Proposed Amendments and
Supplements. Prior to the delivery of any proposed Offering
Memorandum or any proposed amendment or supplement thereto by the Company to
the
Initial Purchaser, the Company shall furnish to the Initial Purchaser for review
a copy of such proposed Offering Memorandum or proposed amendment or supplement
thereto, as the case may be, prior to printing such Offering Memorandum or
any
such amendment or supplement thereto, and the Company shall not print the
Offering Memorandum or issue any proposed amendment or supplement containing
any
provision to which the Initial Purchaser or its counsel reasonably objects
(with
reasonable prior notice in writing to the Company).
(j) Amendments
and Supplements to the Offering Memorandum, Registration Statements and Other
Securities Law Matters.
(i) If,
prior to the completion of the
placement of the Shares by the Initial Purchaser with the Subsequent Purchasers,
any event shall have occurred or condition exists as a result of which the
Offering Memorandum or either Registration Statement, in each case
-23-
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
document is delivered, not misleading, or if in the reasonable opinion of
counsel for the Initial Purchaser it is otherwise necessary to amend or
supplement the Offering Memorandum or either Registration Statement to comply
with applicable law, the Company agrees promptly to prepare (subject to this
Section 7(A)), file with the Commission (with respect
to any Registration Statement amendment or any documents incorporated by
reference) and furnish at its own expense to the Initial Purchaser, such number
of copies of amendments or supplements to the Offering Memorandum or a
Registration Statement, as the case may be, as are reasonably requested by
the
Initial Purchaser containing such information as is necessary so that the
statements therein as so amended or supplemented will not, in the light of
the
circumstances when such document is delivered to a purchaser, be misleading
or
so that such document, as amended or supplemented, will comply with applicable
law.
(ii) Following
the effectiveness of either Registration Statement and for so long as the Shares
are outstanding if, in the judgment of the Initial Purchaser, the Initial
Purchaser or any of its Affiliates is required to deliver a prospectus in
connection with sales of, or market-making activities with respect to, the
Shares, the Company agrees (A) periodically to amend the applicable Registration
Statement so that the information contained therein complies with the
requirements of Section 10(a) of the Securities Act, (B) to amend the applicable
registration statement or supplement the related prospectus or the documents
incorporated therein when necessary to reflect any material changes in the
information provided therein so that the registration statement and the
prospectus will not contain any untrue statement of a material fact or omit
to
state any material fact necessary in order to make the statements therein,
in
the light of the circumstances existing as of the date the prospectus is so
delivered, not misleading and (C) to provide the Initial Purchaser with copies
of each amendment or supplement filed and such other documents as the Initial
Purchaser may reasonably request.
(iii) The
Company hereby expressly acknowledges that the indemnification and contribution
provisions of Section 9 of this Agreement are
specifically applicable and relate to each offering memorandum, registration
statement, prospectus, amendment or supplement referred to in this Section 7(A).
(k) Blue
Sky Compliance. The Company (i) shall cooperate with the Initial
Purchaser and counsel for the Initial Purchaser to qualify or register the
-24-
Shares
for sale under (or obtain exemptions from the application of) the Blue Sky
or
state or other securities laws of those jurisdictions (both domestic and
foreign) as may be designated by the Initial Purchaser or its counsel, (ii)
shall comply with such laws and (iii) shall continue such qualifications,
registrations and exemptions in effect so long as required for the Initial
Purchaser’s placement of the Shares to the Subsequent Purchasers;
provided, however, that the Company shall not be required to
qualify as a foreign corporation or to take any action that would subject it
to
general service of process in any such jurisdiction where it is not presently
qualified or where it would be subject to taxation as a foreign corporation;
and
provided, further, that the Company may require that offers
and sales in one or more jurisdictions must be made through brokers licensed
in
that jurisdiction. The Company will advise the Initial Purchaser
promptly of its knowledge of the suspension of the qualification or registration
of (or any such exemption relating to) the Shares for offering, sale or trading
in any jurisdiction or any initiation or threat of any proceeding for any such
purpose, and, in the event of the issuance of any order suspending such
qualification, registration or exemption, the Company shall use its best efforts
to obtain the withdrawal thereof at the earliest possible moment.
(l) Exchange
Act Filings. Prior to the completion of the placement of the
Shares by the Initial Purchaser with the Subsequent Purchasers, the Company
shall file, on a timely basis, with the Commission and the NYSE all reports
and
documents required to be filed under Section 13 or 15(d) of the Exchange
Act.
(B) Offering
Commencement Date/Customary Rule 144A Deliveries. If the Company
fails to redeem all the Shares on or before September 25, 2008, then the Company
shall deliver, and shall cause its attorneys, accountants and officers, as
applicable, to deliver the following documents to the Initial Purchaser at
the
offices of Hunton & ▇▇▇▇▇▇▇▇ LLP, Richmond, Virginia no later than 5:00 p.m.
New York time on September 25, 2008, (the “Offering Commencement
Date”).
(a) Opinions
of Counsel. On the Offering Commencement Date, the Initial
Purchaser shall receive the corporate and federal income tax opinions of ▇▇▇▇▇
Liddell & ▇▇▇▇, securities and tax counsel for the Company, each dated the
date of its delivery, in substantially the form set forth in Exhibit
C.
(b) Accountant’s
Comfort Letter. On the Offering Commencement Date, the Initial
Purchaser shall receive from the Accountants (who shall be independent public
accountants within the meaning of Regulation S-X under the Securities Act and
the Exchange Act) a letter dated as of such date addressed to the Initial
Purchaser, containing statements and information of the type ordinarily included
in an accountants’ “comfort letter” to underwriters of public offerings,
delivered according to Statement of Auditing Standards No. 72 (or any successor
bulletin), with respect to the audited, unaudited and pro forma, if any,
financial statements and certain financial information contained, or
incorporated by reference, in the Offering Memorandum in form and substance
reasonably satisfactory to the Initial Purchaser.
-25-
(c) Officers’
Certificate. On the Offering Commencement Date, the Initial
Purchaser shall receive from the Company a certificate, dated the date of its
delivery, signed by each of the Chief Executive Officer and the Chief Financial
Officer of the Company, in form and substance satisfactory to the Initial
Purchaser, to the effect that:
(i) Any
request for information regarding
the Shares or the Rule 144A offering on the part of the staff of the Commission
or any such authorities has been complied with to the satisfaction of the staff
of the Commission or such authorities;
(ii) Each
signer of such certificate has carefully examined the Offering Memorandum (which
term includes the Incorporated Documents) and (A) as of the date of such
certificate, such documents, taken together, do not include an untrue statement
of any 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 and (B) no event has occurred as a result of which it
would
be necessary to amend or supplement the Offering Memorandum in order to make
the
statements therein not untrue or misleading in any material
respect. All documents required to be filed under the Exchange Act
since January 1, 2007 have been filed as required;
(iii) Each
of
the representations and warranties of the Company contained in this Agreement
was, when originally made, and is, at the time such certificate is delivered,
true and correct in all material respects;
(iv) Each
of
the covenants required to be performed by the Company herein on or prior to
the
delivery of such certificate has been duly, timely and fully performed in all
material respects, and each condition herein required to be complied with by
the
Company on or prior to the date of such certificate has been duly, timely and
fully complied with;
(v) Except
as
set forth in the SEC Filings, as contemplated by this Agreement and the
transactions referred to herein and as relating to or resulting from the
issuance of the Company’s Series G Preferred Shares for the period from and
after the date of this Agreement through the date of such certificate, (A)
the
Company and its subsidiaries, taken as a whole, have not incurred any
liabilities or obligations, direct or contingent, or entered into any
transactions (other than, in each case, in the ordinary course of business
consistent with past practice), that are material to the Company and its
subsidiaries, taken as a whole, (B) there has not occurred any material
change in the shares of beneficial interest, total
-26-
debt
of
the Company and (C) there has not occurred any material adverse change, or
any development involving a prospective material adverse change, in the
financial condition, business, prospects, net worth or results of operations
of
the Company and its subsidiaries, taken as a whole.
(vi) Other
Documents. On the Offering Commencement Date, counsel to the
Initial Purchaser shall be furnished with such other documents as such counsel
may reasonably require in order to evidence the accuracy and completeness of
any
of the representations and warranties, or the fulfillment of any of the
conditions, contained in this Agreement.
All
such
opinions, certificates, letters and other documents will be in compliance with
the provisions hereof only if they are reasonably satisfactory in form and
substance to the Initial Purchaser and its counsel. The Initial
Purchaser may, in its sole discretion, but shall not be required to, waive
in
writing the performance by the Company of any one or more of the foregoing
covenants or extend the time for their performance.
Section
8. Offer,
Sale and Resale Procedures. The Initial Purchaser and the Company
hereby establish and agree to observe the following procedures in connection
with the offer and sale of the Shares:
(a) Offers
and Sales only to Qualified Institutional Buyers or Institutional Accredited
Investors. Offers and sales of the Shares will be made only by
the Initial Purchaser or Affiliates thereof qualified or registered to do so
in
the jurisdictions in which such offers or sales are made. Each such
offer or sale shall be made only:
(i) to
persons whom the offeror or seller,
or any person acting on behalf of them, reasonably believes to be qualified
institutional buyers (as defined in Rule 144A under the Securities Act);
or
(ii) to
a
limited number of other institutional accredited investors (as such term is
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) that the offeror or seller reasonably believes to be and, with respect
to
sales and deliveries, that are Accredited Investors (“Institutional
Accredited Investors”).
(b) No
General Solicitation. The Shares will be offered by approaching
prospective Subsequent Purchasers on an individual basis. No general
solicitation or general advertising (within the meaning of Rule 502(c) under
the
Securities Act) will be used in connection with the offering of the
Shares.
(c) Purchases
by Non-Bank Fiduciaries. In the case of a non-bank Subsequent
Purchaser of Shares acting as a fiduciary for one or more third parties,
-27-
in
connection with an offer and sale to such purchaser pursuant to Section 8(a) above, each third party shall, in the
reasonable judgment of the Initial Purchaser, be a Qualified Institutional
Buyer.
(d) Rule
144A Reliance and Restrictions on Transfer. The Offering
Memorandum shall make prospective offerees aware of the reliance by the offeror
and/or seller on the exemption provided by Rule 144A and shall provide that
investors that acquire any Shares shall be deemed to have agreed that such
Shares may only be resold or otherwise transferred if such Shares are registered
for sale under the Securities Act, or pursuant to an available exemption from
the registration requirements of the Securities Act (including Rule 144A),
or in
a transaction not otherwise subject to the Securities Act.
(e) No
Liability of Initial Purchaser Following the Sale of the
Shares. Following the sale of the Shares by the Initial
Purchaser to Subsequent Purchasers pursuant to the terms of this Agreement,
the
Initial Purchaser shall not be liable or responsible to the Company for any
losses, damages or liabilities suffered or incurred by the Company including
any
losses, damages or liabilities under the Securities Act, arising from or
relating to any subsequent resale or transfer of any Shares other than by the
Initial Purchaser.
Section
9. Indemnification
and Contribution.
The
Company agrees to indemnify and hold harmless the Initial Purchaser, its
officers and directors, and each person, if any, who controls the Initial
Purchaser within the meaning or 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 the legal fees and other
expenses incurred in connection with any suit, action or proceeding or any
claim
asserted) caused by any untrue statement or alleged untrue statement of a
material fact contained in any Offering Memorandum (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,
in
light of the circumstances under which they were made, not misleading except
insofar as such losses, claims, damages or liabilities are caused by any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with information relating to the Initial Purchaser
furnished to the Company in writing by the Initial Purchaser expressly for
use
therein. The foregoing indemnity agreement shall be in addition to
any liability which the Company may otherwise have.
The
Initial Purchaser agrees to indemnify and hold harmless the Company and the
Company’s officers and trust managers and each person who controls the Company
within the meaning of Section 15 of the Securities Act and Section 20 of the
Exchange Act, to the same extent as the foregoing indemnity from the Company
to
the Initial Purchaser, but only with reference to information relating to the
Initial Purchaser furnished to the Company in writing by the Initial Purchaser
expressly for use in the Offering Memorandum or any amendment or supplement
thereto. Notwithstanding the preceding, in no case shall the Initial
Purchaser be
-28-
liable
or
responsible for any amount in excess of the fee specified in Section 1(d) received by such Initial Purchaser in
connection with the purchase of the Shares pursuant to this
Agreement.
If
any
suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any person
in respect of which indemnity may be sought pursuant to either of the two
preceding paragraphs, such person (the “Indemnified Person”) shall
promptly notify the person against whom such indemnity may be sought (the
“Indemnifying Person”) in writing, and the Indemnifying Person, upon
request of the Indemnified Person, shall retain counsel reasonably satisfactory
to the Indemnified Person to represent the Indemnified Person and any others
the
Indemnifying Person may designate in such proceeding and shall pay the fees
and
expenses of such counsel related to such proceeding. In any such
proceeding, any Indemnified Person 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 Person unless (i) the Indemnifying Person and the Indemnified
Person shall have mutually agreed to the contrary, (ii) the Indemnifying Person
has failed within a reasonable time to retain counsel reasonably satisfactory
to
the Indemnified Person or (iii) the named parties in any such proceeding
(including any impleaded parties) include both the Indemnifying Person and
the
Indemnified Person 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 Person shall not, in
connection with any proceeding or related proceeding in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all Indemnified Persons, and that all such fees and
expenses shall be reimbursed as they are incurred. Any such separate
firm for the Initial Purchaser and such control persons of Initial Purchaser
shall be designated in writing by Wachovia Capital Markets, LLC and any such
separate firm for the Company, their directors, their officers and such control
persons of the Company or authorized representatives shall be designated in
writing by the Company. The Indemnifying Person 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 Person agrees to indemnify any Indemnified Person from and
against any loss or liability by reason of such settlement or
judgment. Notwithstanding the foregoing sentence, if at any time an
Indemnified Person shall have requested an Indemnifying Person to reimburse
the
Indemnified Person for fees and expenses of counsel as contemplated by the
third
sentence of this paragraph, the Indemnifying Person 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 Person of the aforesaid request and (ii) such Indemnifying
Person shall not have reimbursed the Indemnified Person in accordance with
such
request prior to the date of such settlement. If it is ultimately
determined that an Indemnified Person was not entitled to indemnification
hereunder, such Indemnified Person shall be responsible for repaying or
reimbursing the Indemnifying Person for any amounts so paid or incurred by
such
Indemnifying Person pursuant to this paragraph. No Indemnifying
Person shall, without the prior written consent of the Indemnified Person,
effect any settlement of any pending or threatened proceeding in respect of
which any Indemnified Person is or could have been a party and indemnity could
have been sought hereunder by such Indemnified Person, unless such settlement
(i) includes an unconditional release of such Indemnified Person from all
liability on claims that are the subject matter of such proceeding and (ii)
does
not include a statement as to, or an admission of, fault, culpability or a
failure to act by or on behalf of an Indemnified Person. In no event
shall any Indemnifying Person have any
-29-
liability
or responsibility in respect of the settlement or compromise of, or consent
to
the entry of any judgment with respect to any pending or threatened action
or
claim effected without its prior written consent.
If
the
indemnification provided for in the first and second paragraphs of this Section 9 is unavailable or insufficient to hold
harmless an Indemnified Person in respect of any losses, claims, damages or
liabilities referred to therein, then each Indemnifying Person under such
paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall
contribute to the amount paid or payable by such Indemnified Person as a result
of such losses, claims, damages or liabilities (a) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the
one
hand and the Initial Purchaser on the other hand from the offering of the Shares
or (b) if the allocation provided by clause (a) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (a) above but also the relative fault
of
the Company on the one hand and the Initial Purchaser on the other 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 on the
one hand and the Initial Purchaser on the other shall be deemed to be in the
same respective proportions as the net proceeds from the offering of such Shares
(before deducting expenses other than fees payable pursuant to Section 1(d) herein) received by the Company and the
total underwriting discounts and the commissions received by the Initial
Purchaser bear to the aggregate public offering price of the
Shares. The relative fault of the Company on the one hand and the
Initial Purchaser on the other 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 on the one hand or by the Initial Purchaser on the
other
and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The
Company and the Initial Purchaser agree that it would not be just and equitable
if contribution pursuant to this Section
9 were determined by pro rata allocation or by any other method of
allocation that does not take account of the equitable considerations referred
to in the immediately preceding paragraph. The amount paid or payable
by an Indemnified Person 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 incurred by such Indemnified Person in connection with investigating
or
defending any such action or claim. Notwithstanding the provisions of
this Section 9, in no event shall the Initial
Purchaser be required to contribute any amount in excess of the fee, specified
in Section 1(d), received by the Initial Purchaser
in connection with the purchase of the Shares pursuant to this
Agreement. 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 9 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.
-30-
The
indemnity and contribution agreements contained in this Section 9 and the representations, warranties and
covenants of the Company and the Initial Purchaser set forth in this Agreement
shall remain operative and in full force and effect regardless of (a) any
termination of this Agreement, (b) any investigation made by or on behalf of
the
Initial Purchaser or any person controlling the Initial Purchaser or by or
on
behalf of the Company, its officers or directors or any other person controlling
the Company and (c) acceptance of and payment for any of the
Shares.
Section
10. Representations
and Agreements to Survive Delivery. The agreements set forth in Section 6, Section 7, Section
8 and Section 9
shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of the Initial Purchasers or any controlling
person of the Initial Purchaser, or by or on behalf of the Company or of any
of
its subsidiaries, and shall survive delivery of and payment for the
Shares.
Section
11. Notices. All
notices or communications hereunder shall be in writing and shall be mailed,
delivered or telecopied and confirmed (including confirmation by email if so
indicated):
(a) if
to the
Company, to:
▇▇▇▇▇▇▇▇▇▇
Realty Investors
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇.▇.
▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Chief
Executive Officer
Telecopy: (▇▇▇)
▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
with
a copy to:
▇▇▇▇▇
Liddell & ▇▇▇▇
▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇
Belts, Esq.
Telecopy: (▇▇▇)
▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
(b) and
if to
the Initial Purchaser to:
Wachovia
Investment Holdings, LLC
▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇
▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇.
▇▇▇▇▇▇ ▇▇▇
Telecopy: (▇▇▇)
▇▇▇-▇▇▇▇
E-Mail: ▇▇▇▇▇▇.▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
-31-
with
a copy to:
Hunton
& ▇▇▇▇▇▇▇▇ LLP
Riverfront
Plaza, East Tower
▇▇▇
▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇, ▇▇., Esq.
Telecopy: (▇▇▇)
▇▇▇-▇▇▇▇
E-Mail:
▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
Any
party
to this Agreement may change such address for notices by sending to the other
parties to this Agreement written notice of a new address for such
purpose.
-32-
Section
12. Parties. This
Agreement shall inure to the benefit of and be binding upon the Initial
Purchaser and the Company and their respective successors. Nothing
expressed or mentioned in this Agreement is intended, or shall be construed,
to
give any person, firm or corporation, other than the parties hereto and their
respective successors and the controlling persons and officers, trust managers
and directors referred to in Section 4(h) and Section 9 hereof and their
heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the parties hereto and respective successors
and
said controlling persons and officers, trust managers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm
or
corporation. No purchaser of Shares shall be deemed to be a successor
by reason merely of such purchase.
Section
13. Governing
Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
Section
14. Counterparts. This
Agreement may be executed in one or more counterparts, signature pages may
be
detached from such separately executed counterparts and reattached to other
counterparts and, in each such case, the executed counterparts hereof shall
constitute a single instrument. Signature pages may be delivered by
telecopy.
Section
15. Enforceability. In
case any provision of this Agreement shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall
not
in any way be affected or impaired thereby.
Section
16. Waiver
of
Rights to Trial by Jury. The Company and the Initial Purchaser each
hereby irrevocably waive any right they may have to a trial by jury in respect
of any claim based upon or arising out of this Agreement or the transactions
contemplated hereby.
Section
17. Amendments
and Modifications. This Agreement may not be amended or otherwise
modified or any provision hereof waived except by an instrument in writing
signed by the Initial Purchaser and the Company.
[SIGNATURE
PAGE FOLLOWS.]
-33-
If
the
foregoing correctly sets forth the understanding between the Company and the
Initial Purchaser, please so indicate in the space provided below for that
purpose, whereupon this letter shall constitute a binding agreement between
the
Initial Purchaser and the Company.
|
▇▇▇▇▇▇▇▇▇▇
REALTY INVESTORS
|
||
|
By:
|
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |
|
Name:
|
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |
|
Title:
|
Executive VP/CFO | |
|
ACCEPTED
as of the date first written above:
|
|
|
WACHOVIA
INVESTMENT HOLDINGS, LLC
|
|
|
By:
|
/s/ ▇▇▇▇▇ ▇▇▇▇▇ |
|
Name:
|
▇▇▇▇▇ ▇▇▇▇▇ |
|
Title
|
Managing Director |
-34-
EXHIBIT
A
State
of
Designations
[attached]
EXHIBIT
B
|
Entity
|
Type
|
Ownership
|
||
|
AN/WRI
DEVCO #1, Ltd. (3)
|
Limited
Partnership
|
20%
|
||
|
AN/WRI
Partnership, Ltd. (2)
|
Limited
Partnership
|
20%
|
||
|
Cumberland
Potranco Joint Venture (1)
|
Joint
Venture
|
50%
|
||
|
Eastex
Venture (1)
|
Joint
Venture
|
50%
|
||
|
▇▇▇▇▇▇
Market Place Venture (3)
|
Joint
Venture
|
50%
|
||
|
GDC
River Hill Tower, LLC (15)
|
Limited
Liability Company
|
51%
|
||
|
GVR
SPE I LLC (18)
|
Limited
Liability Company
|
100%
|
||
|
Heritage
HT #1, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
Jacinto
City, Ltd. (1)
|
Limited
Partnership
|
50%
|
||
|
Main/O.S.T.,
Ltd. (1)
|
Limited
Partnership
|
70%
|
||
|
Markham
West Shopping Center, L.P. (1)
|
Limited
Partnership
|
99.5%
|
||
|
NOBSIL,
L.L.C. (3)
|
Limited
Liability Company
|
75%
|
||
|
North
Towne Plaza Joint Venture (1)
|
Joint
Venture
|
75%
|
||
|
Northwest
Hollister Venture (1)
|
Joint
Venture
|
75%
|
||
|
Palm
Coast Center, LLC (1)
|
Limited
Liability Company
|
50%
|
||
|
▇▇▇▇▇▇
Boulevard Venture (1)
|
Joint
Venture
|
67%
|
||
|
RGC
Starr Retail, Ltd. (3)
|
Limited
Partnership
|
45%
|
||
|
▇▇▇▇▇▇▇
Center, Ltd. (1)
|
Limited
Partnership
|
50%
|
||
|
South
Loop-Long Wayside Company (1)
|
Joint
Venture
|
50%
|
||
|
Strategic
Retail Partners, L.L.C. (3)
|
Limited
Liability Company
|
40%
|
||
|
Strategic
Retail Partners II, L.L.C. (16)
|
Limited
Liability Company
|
25%
|
||
|
SPM/WRI
College Station, L.P. (3)
|
Limited
Partnership
|
100%
|
||
|
SPM/WRI
Rockwall, L.P. (3)
|
Limited
Partnership
|
100%
|
||
|
S/W
Albuquerque, L.P. (3)
|
Limited
Partnership
|
100%
|
||
|
Utah-WRI
Holdings, L.L.C. (12)
|
Limited
Liability Company
|
20%
|
||
|
Weingarten
– ▇▇▇▇▇▇, LLC (1)
|
Limited
Liability Company
|
81.3%
|
||
|
Weingarten
1815 S. 10th JV (1)
|
Joint
Venture
|
50%
|
||
|
Weingarten
▇▇▇▇▇▇▇ Plaza JV (1)
|
Joint
Venture
|
50%
|
||
|
Weingarten
▇▇▇▇▇▇ Waterford Venture (1)
|
Joint
Venture
|
75%
|
||
|
Weingarten
I-4 Clermont Landing TRS, LLC (1)
|
Limited
Liability Company
|
55%
|
||
|
Weingarten
I-4 Clermont Landing, LLC (1)
|
Limited
Liability Company
|
55%
|
||
|
Weingarten
Las Tiendas Joint Venture (1)
|
Joint
Venture
|
50%
|
||
|
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ Tropicana, LLC (3)
|
Limited
Liability Company
|
50%
|
||
|
Weingarten
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLC (1)
|
Limited
Liability Company
|
50%
|
||
|
Weingarten
▇▇▇▇▇▇ ▇▇▇▇▇▇ II, LLC (18)
|
Limited
Liability Company
|
100%
|
||
|
Weingarten
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLC (3)
|
Limited
Liability Company
|
41%
|
||
|
Weingarten
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLC (1)
|
Limited
Liability Company
|
50%
|
||
|
Weingarten
▇▇▇▇▇▇▇▇, LLC (1)
|
Limited
Liability Company
|
50%
|
||
|
Weingarten
▇▇▇▇▇▇ ▇▇▇▇▇ II, LLC (18)
|
Limited
Liability Company
|
100%
|
||
|
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ JV (1)
|
Joint
Venture
|
50%
|
||
|
Weingarten
▇▇▇▇▇▇▇▇▇▇ Joint Venture (1)
|
Joint
Venture
|
50%
|
||
|
Weingarten
Nostat, Inc. (10)
|
Corporate
Subsidiary
|
100%
|
||
|
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ Crossing JV (1)
|
Joint
Venture
|
50%
|
||
|
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ North JV (1)
|
Joint
Venture
|
50%
|
||
|
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ South JV (1)
|
Joint
Venture
|
50%
|
||
|
Weingarten
Tenth-▇▇▇▇▇▇▇ West Joint Venture (1)
|
Joint
Venture
|
50%
|
||
|
Weingarten/Bridges
at Smoky Hill (1)
|
Joint
Venture
|
50%
|
||
|
Weingarten/Finger
Venture (1)
|
Joint
Venture
|
50%
|
||
|
Weingarten/▇▇▇▇▇▇/American
Fork LLC (3)
|
Limited
Liability Company
|
33%
|
||
|
Weingarten/▇▇▇▇▇▇/GVR
LLC (1)
|
Limited
Liability Company
|
36.9%
|
||
|
Weingarten/Monvis
LLC (1)
|
Limited
Liability Company
|
70%
|
||
|
WNI/Tennessee,
L.P. (8)
|
Limited
Partnership
|
100%
|
|
Entity
|
Type
|
Ownership
|
||
|
WRI
151 ▇▇▇▇▇▇ ▇▇ (1)
|
Limited
Partnership
|
66.7%
|
||
|
WRI
Alliance ▇▇▇▇▇ Venture (1)
|
Joint
Venture
|
50%
|
||
|
WRI
Alliance ▇▇▇▇▇ Venture III (1)
|
Joint
Venture
|
50%
|
||
|
WRI
Best in the West, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Brookwood Square, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Charleston Commons, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Cottonwood, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Countryside Centre, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
El Camino, LP (3)
|
Limited
Partnership
|
100%
|
||
|
WRI
Fiesta Trails, LP (3)
|
Limited
Partnership
|
100%
|
||
|
WRI
Flamingo Pines, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Freedom Centre, L.P. (3)
|
Limited
Partnership
|
100%
|
||
|
WRI
Galleria, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Gateway Station, LP (1)
|
Limited
Partnership
|
70%
|
||
|
WRI
Golden State, LLC (4)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Greenhouse LP (3)
|
Limited
Partnership
|
99%
|
||
|
WRI
Hopewell, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
▇▇▇▇▇▇▇▇ Road Plaza, LLC (3)
|
Limited
Liability Company
|
99%
|
||
|
WRI
Kennesaw, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Laguna Isles, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Lakeland, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
LLA Venture (1)
|
Joint
Venture
|
50%
|
||
|
WRI
Madera Village, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Marshalls Plaza, LP (3)
|
Limited
Partnership
|
100%
|
||
|
WRI
North American Properties, L.P (17)
|
Limited
Partnership
|
98%
|
||
|
WRI
Northtown I, LP (3)
|
Limited
Partnership
|
100%
|
||
|
WRI
Northtown II, LP (3)
|
Limited
Partnership
|
100%
|
||
|
WRI
Oak Grove Market Center, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
▇▇▇▇▇▇▇ Plaza, LP (3)
|
Limited
Partnership
|
100%
|
||
|
WRI
Parkland, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Pinecrest Plaza, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Ravenstone, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Regency Centre, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
River Marketplace, LLC (9)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Roswell Corners LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
▇▇▇▇▇ Plains, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Shoppes at Bears Path, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
Shoppes of South Semoran, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
▇▇▇▇▇▇ Creek, LLC (3)
|
Limited
Liability Company
|
99%
|
||
|
WRI
▇▇▇▇▇, ▇.▇. (1)
|
Limited
Partnership
|
100%
|
||
|
WRI
▇▇▇▇▇▇▇▇ Bridge, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
▇▇▇▇▇▇▇▇▇, ▇.▇. (7)
|
Limited
Partnership
|
99%
|
||
|
WRI
Uintah Gardens, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI
University Place, LLC (9)
|
Limited
Liability Company
|
100%
|
||
|
WRI
West Jordan LLC (3)
|
Limited
Liability Company
|
99%
|
||
|
WRIJV,
LP (14)
|
Limited
Partnership
|
20%
|
||
|
WRI/Atlanta
Park, L.P. (3)
|
Limited
Partnership
|
99%
|
||
|
WRI/BIT
Retail JV, LP (13)
|
Limited
Partnership
|
20%
|
||
|
WRI/Chino
Hills, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI/Falls
Pointe, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI/High
House LLC (3)
|
Limited
Liability Company
|
68%
|
||
|
WRI/Hollywood
Hills, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI/▇▇▇▇▇▇
Westminster I, LLC (3)
|
Limited
Liability Company
|
50%
|
||
|
WRI/▇▇▇▇▇▇
Corners, Inc. (5)
|
Corporate
Subsidiary
|
100%
|
||
|
WRI/Raleigh
L.P. (6)
|
Limited
Partnership
|
68%
|
|
Entity
|
Type
|
Ownership
|
||
|
WRI/Rancho
San Marcos, LLC (3)
|
Limited
Liability Company
|
100%
|
||
|
WRI/Utah
Properties L.P. (3)
|
Limited
Partnership
|
99%
|
||
|
WT
Florida Ventures, LLC (11)
|
Limited
Liability Company
|
20%
|
||
|
|
Footnotes:
|
|
(1)
|
Entity
is a joint venture, limited partnership or limited liability company
that
owns a single real estate asset.
|
|
(2)
|
Entity
is a limited partnership that owns seven industrial properties, which
are
collateral for borrowings from a third
party.
|
|
(3)
|
Entity
is a joint venture, limited partnership or limited liability company
that
owns a single real estate asset that is collateral for borrowings
from a
third party.
|
|
(4)
|
Entity
is a limited liability company that owns 19 retail properties, which
are
collateral for borrowings from a third
party.
|
|
(5)
|
Entity
is a corporate subsidiary that owns a single real estate asset, which
is
collateral for borrowings from a third
party.
|
|
(6)
|
Entity
is a limited partnership that owns nine properties of which three
properties serve as collateral for borrowings from a third
party.
|
|
(7)
|
Entity
is a limited partnership that owns two properties that serve as collateral
for borrowings from a third party.
|
|
(8)
|
Entity
is a limited partnership that owns six properties of which one serves
as
collateral for borrowings from a third
party.
|
|
(9)
|
Entity
is a limited liability company with a 20% interest in a tenancy-in-common
arrangement which holds a property that serves as collateral for
a
borrowing from a third party.
|
|
(10)
|
Entity
is a corporate subsidiary that owns 54 properties of which four properties
serve as collateral for borrowings from a third
party.
|
|
(11)
|
Entity
is a limited liability company that owns seven
properties.
|
|
(12)
|
Entity
is a limited liability company that owns six properties, which serve
as
collateral for borrowings from a third
party.
|
|
(13)
|
Entity
is a limited partnership that owns three
properties.
|
|
(14)
|
Entity
is a limited partnership that owns 12 properties of which four properties
serve as collateral for borrowings from a third
party.
|
|
(15)
|
Entity
is a limited liability company that owns three properties, which
serve as
collateral for borrowings from a third
party.
|
|
(16)
|
Entity
is a limited liability company that owns nine properties of which
eight
properties serve as collateral for borrowings from a third
party.
|
|
(17)
|
Entity
is a limited partnership that owns six properties of which five properties
serve as collateral for borrowings from a third
party.
|
|
(18)
|
Entity
is a limited liability company with a 50% interest in a tenancy-in-common
arrangement which holds a property that serves as collateral for
a
borrowing from a third party.
|
EXHIBIT
C
Form
of
Legal Opinion
[attached]