MID-AMERICA APARTMENT COMMUNITIES, INC. 4,000,000 SHARES CONTROLLED EQUITY OFFERINGSM SALES AGREEMENT
MID-AMERICA
APARTMENT COMMUNITIES, INC.
4,000,000
SHARES
CONTROLLED EQUITY
OFFERINGSM
November
5, 2009
CANTOR
▇▇▇▇▇▇▇▇▇▇ & CO.
▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇,
▇▇ ▇▇▇▇▇
Ladies
and Gentlemen:
MID-AMERICA
APARTMENT COMMUNITIES, INC., a Tennessee corporation (the “Company”),
and MID-AMERICA APARTMENTS, L.P., a Tennessee limited partnership, the sole
general partner of which is the Company (the “Operating
Partnership”), confirm their agreement
(this “Agreement”)
with Cantor ▇▇▇▇▇▇▇▇▇▇ & Co. (“CF&Co”),
as follows:
1. Issuance and Sale of
Shares. The Company agrees that, from time to time during the
term of this Agreement, on the terms and subject to the conditions set forth
herein, it may issue and sell through CF&Co, acting as agent and/or
principal, up to 4,000,000 shares (the “Shares”)
of the Company’s common stock, par value $0.01 per share (the “Common
Stock”). Notwithstanding anything to the contrary contained
herein, the parties hereto agree that compliance with the limitation set forth
in this Section
1 on the number of Shares issued and sold under this Agreement shall be
the sole responsibility of the Company, and CF&Co shall have no obligation
in connection with such compliance. The issuance and sale of Shares
through CF&Co will be effected pursuant to the Registration Statement (as
defined below) filed by the Company and declared effective by the Securities and
Exchange Commission (the “Commission”),
although nothing in this Agreement shall be construed as requiring the Company
to use the Registration Statement to issue Shares.
The
Company has filed, in accordance with the provisions of the Securities Act of
1933, as amended, and the rules and regulations thereunder (collectively, the
“Securities
Act”), with the Commission a registration statement on Form S-3 (File No.
333-159595), including a base prospectus, relating to certain securities,
including the Shares to be issued from time to time by the Company, and which
incorporates by reference documents that the Company has filed or will file in
accordance with the provisions of the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder (collectively, the “Exchange
Act”). The Company has prepared a prospectus supplement specifically
relating to the Shares (the “Prospectus
Supplement”) to the base prospectus included as part of such registration
statement. The Company will furnish to CF&Co, for use by
CF&Co, copies of the prospectus included as part of such registration
statement, as supplemented by the Prospectus Supplement, relating to the
Shares. Except where the context otherwise requires, such
registration statement, as amended when it became effective, including all
documents filed as part thereof or incorporated by reference therein, and
including any information contained in a Prospectus (as defined below)
subsequently filed with the Commission pursuant to Rule 424(b) under the
Securities Act or deemed to be a part of such registration statement pursuant to
Rule 430B of the Securities Act, is herein called the “Registration
Statement.” The base prospectus, including all documents incorporated
therein by reference, included in the Registration Statement, as it may be
supplemented by the Prospectus Supplement, in the form in which such prospectus
and/or Prospectus Supplement have most recently been filed by the Company with
the Commission pursuant to Rule 424(b) under the Securities Act, together with
any “issuer free writing prospectus”, as defined in Rule 433 of the Securities
Act Regulations (“Rule
433”), relating to the shares that (i) is required to be filed with the
Commission by the Company or (ii) is exempt from filing pursuant to Rule
433(d)(5)(i) in each case in the form filed or required to be filed with the
Commission or, if not required to be filed, in the form retained in the
Company’s records pursuant to Rule 433(g), is herein called the “Prospectus.”
Any reference herein to the Registration Statement, the Prospectus or any
amendment or supplement thereto shall be deemed to refer to and include the
documents incorporated by reference therein, and any reference herein to the
terms “amend,” “amendment” or “supplement” with respect to the Registration
Statement or the Prospectus shall be deemed to refer to and include the filing
after the execution hereof of any document with the Commission deemed to be
incorporated by reference therein. For purposes of this Agreement, all
references to the Registration Statement, the Prospectus or to any amendment or
supplement thereto shall be deemed to include any copy filed with the Commission
pursuant to its Electronic Data Gathering Analysis and Retrieval System (“▇▇▇▇▇”).
2. Placements. Each
time that the Company wishes to issue and sell the Shares hereunder (each, a
“Placement”),
it will notify CF&Co by email notice (or other method mutually agreed to in
writing by the parties) containing the parameters in accordance with which it
desires the Shares to be sold, which shall at a minimum include the number of
Shares to be issued (the “Placement
Shares”), the time period during which sales are requested to be made,
any limitation on the number of Shares that may be sold in any one day and any
minimum price below which sales may not be made (a “Placement
Notice”), a form of which containing such minimum sales parameters
necessary is attached hereto as Schedule
1. The Placement Notice shall originate from any of the
individuals from the Company set forth on Schedule
2 (with a
copy to each of the other individuals from the Company listed on such schedule),
and shall be addressed to each of the individuals from CF&Co set forth on
Schedule
2, as such Schedule
2 may be amended from time to time. The Placement Notice shall be
effective upon receipt by CF&Co unless and until (i) in accordance with the
notice requirements set forth in Section 4, CF&Co
declines to accept the terms contained therein for any reason, in its sole
discretion, (ii) the entire amount of the Placement Shares have been sold, (iii)
in accordance with the notice requirements set forth in Section 4, the
Company suspends or terminates the Placement Notice, (iv) the Company issues a
subsequent Placement Notice with parameters superseding those on the earlier
dated Placement Notice, or (iv) the Agreement has been terminated under the
provisions of Section
11. The amount of any discount, commission or other
compensation to be paid by the Company to CF&Co in connection with the sale
of the Placement Shares shall be calculated in accordance with the terms set
forth in Schedule
3. It
is expressly acknowledged and agreed that neither the Company nor CF&Co will
have any obligation whatsoever with respect to a Placement or any Placement
Shares unless and until the Company delivers a Placement Notice to CF&Co and
CF&Co does not decline such Placement Notice pursuant to the terms set forth
above, and then only upon the terms specified therein and herein. In
the event of a conflict between the terms of this Agreement and the terms of a
Placement Notice, the terms of the Placement Notice will control.
3. Sale of Placement Shares by
CF&Co. Subject to the terms and conditions herein set
forth, upon the Company’s issuance of a Placement Notice, and unless the sale of
the Placement Shares described therein has been declined, suspended, or
otherwise terminated in accordance with the terms of this Agreement, CF&Co,
for the period specified in the Placement Notice, will use its commercially
reasonable efforts consistent with its normal trading and sales practices and
applicable state and federal laws, rules and regulations and the rules of the
New York Stock Exchange (the “Exchange”), to sell such Placement
Shares up to the amount specified, and otherwise in accordance with the terms of
such Placement Notice. CF&Co will provide written confirmation to
the Company no later than the opening of the Trading Day (as defined below)
immediately following the Trading Day on which it has made sales of Placement
Shares hereunder setting forth the number of Placement Shares sold on such day,
the compensation payable by the Company to CF&Co pursuant to Section 2 with
respect to such sales, and the Net Proceeds (as defined below) payable to the
Company, with an itemization of the deductions made by CF&Co (as set forth
in Section
5(a)) from the gross proceeds that it receives from such
sales. After consultation to the Company and subject to the terms of
the Placement Notice, CF&Co may sell Placement Shares by any method
permitted by law deemed to be an “at the market” offering as defined in Rule 415
of the Securities Act, including without limitation sales made directly on the
Exchange, on any other existing trading market for the Common Stock or to or
through a market maker. After consultation with the Company and
subject to the terms of the Placement Notice, CF&Co may also sell Placement
Shares in privately negotiated transactions. The Company acknowledges
and agrees that (i) there can be no assurance that CF&Co will be successful
in selling Placement Shares, and (ii) CF&Co will incur no liability or
obligation to the Company or any other person or entity if it does not sell
Placement Shares for any reason other than a failure by CF&Co to use its
commercially reasonable efforts consistent with its normal trading and sales
practices to sell such Placement Shares as required under this Section
3. For the purposes hereof, “Trading
Day” means any day on which shares of Common Stock are purchased and sold
on the principal market on which the Common Stock is listed or
quoted.
4. Suspension of
Sales. The Company or CF&Co may, upon notice to the other
party in writing (including by email correspondence to each of the individuals
of the other Party set forth on Schedule
2, if receipt of such correspondence is actually acknowledged by any of
the individuals to whom the notice is sent, other than via auto-reply) or by
telephone (confirmed immediately by verifiable facsimile transmission or email
correspondence to each of the individuals of the other Party set forth on Schedule
2), suspend any sale of Placement Shares; provided, however, that such
suspension shall not affect or impair either party’s obligations with respect to
any Placement Shares sold hereunder prior to the receipt of such
notice. Each of the Parties agrees that no such notice under this
Section 4 shall
be effective against the other unless it is made to one of the individuals named
on Schedule
2 hereto, as such Schedule may be amended from time to time.
5. Settlement.
(a) Settlement of Placement
Shares. Unless otherwise specified in the applicable Placement
Notice, settlement for sales of Placement Shares will occur on the third (3rd)
Trading Day (or such earlier day as is industry practice for regular-way
trading) following the date on which such sales are made (each, a “Settlement
Date”). The amount of proceeds to be delivered to the Company
on a Settlement Date against receipt of the Placement Shares sold (the “Net
Proceeds”) will be equal to the aggregate sales price received by
CF&Co at which such Placement Shares were sold, after deduction for
(i) CF&Co’s commission, discount or other compensation for such sales
payable by the Company pursuant to Section 2 hereof,
(ii) any other amounts due and payable by the Company to CF&Co hereunder
pursuant to Section
7(h) (Expenses) hereof, and (iii) any transaction fees imposed by any
governmental or self-regulatory organization in respect of such
sales.
(b) Delivery of Placement
Shares. On or before each Settlement Date, the Company will,
or will cause its transfer agent to, electronically transfer the Placement
Shares being sold by crediting CF&Co’s or its designee’s account (provided
CF&Co shall have given the Company written notice of such designee prior to
the Settlement Date) at The Depository Trust Company through its Deposit and
Withdrawal at Custodian System or by such other means of delivery as may be
mutually agreed upon by the parties hereto which in all cases shall be freely
tradeable, transferable, registered shares in good deliverable
form. On each Settlement Date, CF&Co will deliver the related Net
Proceeds in same day funds to an account designated by the Company on, or prior
to, the Settlement Date. The Company agrees that if the Company, or
its transfer agent (if applicable), defaults in its obligation to deliver
Placement Shares on a Settlement Date, the Company agrees that in addition to
and in no way limiting the rights and obligations set forth in Section 9(a)
(Indemnification and Contribution) hereto, it will (i) hold CF&Co
harmless against any loss, claim, damage, or expense (including reasonable legal
fees and expenses), as incurred, arising out of or in connection with such
default by the Company and (ii) pay to CF&Co any commission, discount, or
other compensation to which it would otherwise have been entitled absent such
default.
6. Representations and
Warranties of the Company and the Operating Partnership. The Company and
the Operating Partnership jointly and severally represent and warrant to, and
agree with, CF&Co that as of the date of this Agreement and as of each
Representation Date (as defined in Section 7(n) below)
on which a certificate is required to be delivered pursuant to Section 7(n) of this
Agreement and as of each Applicable Time (as defined in Section 20(a)) as the
case may be:
(a) The Company satisfies all of the
requirements of the Securities Act for use of Form S-3 for the offering of the
Shares contemplated hereby. At the time of the initial filing of the
Registration Statement, at the time of the most recent amendment thereto for the
purposes of complying with Section 10(a)(3) of the Securities Act (whether such
amendment was by post-effective amendment, incorporated report filed pursuant to
Section 13 or 15(d) of the Exchange Act or form of prospectus), at the time the
Company or any person acting on its behalf (within the meaning, for this clause
only, of Rule 163(c) of the Securities Act) made any offer relating to the
Shares in reliance on the exemption of Rule 163 of the Securities Act and at the
date hereof, the Company was and is a “well-known seasoned issuer” as defined in
Rule 405 of the Securities Act, including not having been and not being an
“ineligible issuer,” as defined in Rule 405 of the Securities Act. The
Registration Statement is an “automatic shelf registration statement,” as
defined in Rule 405 of the Securities Act, and the Shares, since their
registration on the Registration Statement, have been and remain eligible for
registration by the Company on a Rule 405 “automatic shelf registration
statement.” The Company has not received from the Commission any notice pursuant
to Rule 401(g)(2) of the Securities Act objecting to the use of the automatic
shelf registration statement form. The Company has paid or will pay
the required Commission filing fees relating to the Shares within the time
required by Rule 456(b)(1)(i) of the Securities Act without regard to the
proviso therein and otherwise in accordance with Rules 456(b) and 457(r) of the
Securities Act (including, if applicable, by updating the “Calculation of
Registration Fee” table in accordance with Rule 456(b)(1)(ii) of the Securities
Act either in a post-effective amendment to the Registration Statement or on the
cover page of the Prospectus).
(b) The
Registration Statement became effective upon filing under Rule 462(e) of the
Securities Act on May 29, 2009, and any post-effective amendment thereto also
became effective upon filing under Rule 462(e). No stop order suspending the
effectiveness of the Registration Statement has been issued under the Securities
Act and no proceedings for that purpose have been instituted or are pending or,
to the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
(c) Any
offer that is a written communication relating to the Shares made prior to the
initial filing of the Registration Statement by the Company or any person acting
on its behalf (within the meaning, for this paragraph only, of Rule 163(c) of
the Securities Act) has been filed with the Commission in accordance with the
exemption provided by Rule 163 of the Securities Act and otherwise complied with
the requirements of Rule 163 of the Securities Act, including without limitation
the legending requirement.
(d) The
Company has delivered to CF&Co one complete copy of the Registration
Statement and a copy of each consent and certificate of experts filed as a part
thereof, and conformed copies of the Registration Statement (without exhibits)
and the Prospectus, as amended or supplemented, in such quantities and at such
places as CF&Co has reasonably requested. The Prospectus
delivered to CF&Co for use in connection with the offering of Shares will,
at the time of such delivery, be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the extent
permitted by Regulation S-T.
(e) At
the respective times the Registration Statement and each amendment thereto
became effective, at each deemed effective date with respect to CF&Co
pursuant to Rule 430B(f)(2) of the Securities Act, as the case may be, the
Registration Statement complied and will comply as to form in all material
respects with the requirements of the Securities Act, and did not and will not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading. The preceding sentence does not apply to statements in or omissions
from the Registration Statement or any amendment thereto in reliance upon and in
conformity with written information relating to CF&Co furnished to the
Company in writing by CF&Co expressly for inclusion in any of the
aforementioned documents.
(f) Neither
the Prospectus nor any amendments or supplements thereto, at the time the
Prospectus or any such amendment or supplement was issued, as of the date
hereof, and at each Representation Date, as the case may be, included or will
include an untrue statement of a material fact or omitted or will omit to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading. The preceding
sentence does not apply to statements in or omissions from the Prospectus, as
amended or supplemented, in reliance upon and in conformity with written
information relating to CF&Co furnished to the Company in writing by
CF&Co expressly for inclusion in any of the aforementioned
documents.
(g) Each
document incorporated by reference in the Registration Statement or the
Prospectus heretofore filed, when it was filed (or, if any amendment with
respect to any such document was filed, when such amendment was filed),
conformed in all material respects with the requirements of the Exchange Act and
the rules and regulations thereunder, and any further documents so filed and
incorporated after the date of this Agreement will, when they are filed, conform
in all material respects with the requirements of the Exchange Act and the rules
and regulations thereunder; no such document when it was filed (or, if an
amendment with respect to any such document was filed, when such amendment was
filed), contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading; and no such document, when it is filed, will
contain an untrue statement of a material fact or will omit to state a material
fact required to be stated therein or necessary in order to make the statements
therein not misleading.
(h) Each
issuer free writing prospectus (as defined in Rule 433), as of its issue date
and as of each Applicable Time (as defined in Section 20 below),
did not, does not and will not include any information that conflicted,
conflicts or will conflict with the information contained in the Registration
Statement or the Prospectus, including any incorporated document deemed to be a
part thereof that has not been superseded or modified. The foregoing sentence
does not apply to statements in or omissions from any issuer free writing
prospectus based upon and in conformity with written information furnished to
the Company by CF&Co specifically for use therein.
(i) All
of the issued and outstanding shares of capital stock of the Company have been
duly authorized and validly issued, are fully paid and nonassessable and have
been issued in compliance with applicable federal and state securities
laws. None of the Company’s outstanding shares of Common Stock or
preferred stock (the “Preferred
Stock”) were issued in violation of any preemptive rights, rights of
first refusal or other similar rights; except as set forth in the Prospectus,
the Company is not a party to or bound by any outstanding options, warrants or
similar rights to subscribe for, or contractual obligations to issue, sell,
transfer or acquire, any of its capital stock or any securities convertible into
or exchangeable for any of such capital stock; the Shares to be issued and sold
by the Company hereunder have been duly authorized and, when issued and
delivered against full payment therefor in accordance with the terms hereof will
be validly issued, fully paid and nonassessable and free of any preemptive
rights, rights of first refusal or other or similar rights; the capital stock
(including the Shares) of the Company conforms to the description thereof
contained in the Prospectus; and the delivery of the Shares being sold by the
Company against payment therefor pursuant to the terms of this Agreement will
pass valid title to the Shares being sold by the Company, free and clear of any
claim, encumbrance or defect in title, and without notice of any lien, claim or
encumbrance. The certificates used by the Company to evidence the Common Stock
or the Preferred Stock are in valid and sufficient form.
(j) Immediately after the transactions
contemplated by this Agreement, all of the issued and outstanding Common Units
(as defined below) will be validly issued, fully paid and nonassessable.
Immediately after the transactions contemplated by this Agreement, none of the
outstanding common units of limited partnership interest in the Operating
Partnership (“Common
Units”) or
preferred units of limited partnership interest in the Operating Partnership
(“Preferred
Units”) has been
or will be issued or is owned or held in violation of any preemptive right,
right of first refusal or other similar right; and the outstanding Common Units
and Preferred Units have been or will be offered, sold and issued by the
Operating Partnership in compliance with applicable federal and state securities
laws.
(k) Each of the Company and its
subsidiaries is duly organized and validly existing in good standing under the
laws of the state of its incorporation or organization with full corporate,
partnership or entity power and authority, as the case may be, to own, lease and
operate its properties and to conduct its business as presently conducted and as
described in the Prospectus and is duly registered and qualified to conduct its
business and is in good standing in each jurisdiction or place where the nature
of its properties or the conduct of its business requires such registration or
qualification, except where the failure to so register or qualify has not had or
will not have a material adverse effect on the condition (financial or other),
business, properties, or results of operations of the Company and its
subsidiaries, taken as a whole (a “Material
Adverse Effect”). The Company is the sole general partner of the
Operating Partnership, and the Company and MAC II of Delaware, L.P. (“MAC
II”) collectively
own a percentage interest in the Operating Partnership disclosed in the
Prospectus. Except as disclosed in the Prospectus, the Company and MAC II own
all of the outstanding Preferred Units. Except as described above, the Company
or the Operating Partnership is the sole direct or indirect owner of all of the
equity interests in each of the subsidiaries other than the Operating
Partnership, Mid-America Multifamily Fund I, LLC and Mid-America Multifamily
Fund II, LLC.
(l) The
outstanding equity interests of each of the Company’s subsidiaries have been
duly authorized and validly issued, are fully paid and nonassessable and are
owned by the Company, directly or through subsidiaries, free and clear of any
security interests, liens, encumbrances, equities or claims. The Company does
not have any subsidiaries and does not own a material interest in or control,
directly or indirectly, any other corporation, partnership, joint venture (other
than Mid-America Multifamily Fund II, LLC in which the Company owns a 33.33%
ownership interest), association, trust or other business organization, except
as set forth in Exhibit 21 to the Company’s most recent Annual Report on Form
10-K incorporated by reference into the Registration Statement. As used in this
Agreement, subsidiaries shall mean direct and indirect subsidiaries of the
Company.
(m) Except
as described in the Prospectus, there is no action, suit, inquiry, proceeding or
investigation by or before any court or governmental or other regulatory or
administrative agency or commission pending or, to the best knowledge of the
Company, threatened, against or involving the Company or its subsidiaries, which
might individually or in the aggregate prevent or adversely affect the
transactions contemplated by this Agreement or result in a Material Adverse
Effect, nor to the Company’s knowledge, is there any basis for any such action,
suit, inquiry, proceeding or investigation. There are no agreements, contracts,
indentures, leases or other instruments that are required to be described in the
Prospectus or to be filed as an exhibit to the Registration Statement that are
not described, filed or incorporated by reference in the Registration Statement
and the Prospectus as required by the Securities Act. All such contracts to
which the Company or any of its subsidiaries is a party have been duly
authorized, executed and delivered by the Company or the applicable subsidiary,
constitute valid and binding agreements of the Company or the applicable
subsidiary and are enforceable against the Company or the applicable subsidiary
in accordance with the terms thereof, except as enforceability thereof may be
limited by (i) the application of bankruptcy, reorganization, insolvency and
other laws affecting creditors’ rights generally and (ii) equitable principles
being applied at the discretion of a court before which any proceeding may be
brought. Neither the Company nor the applicable subsidiary has received notice
or been made aware that any other party is in breach of or default to the
Company or its subsidiaries under any of such contracts.
(n) Neither
the Company nor any of its subsidiaries is (i) in violation of (A) its
Organizational Documents, (B) to the Company’s knowledge any law, ordinance,
administrative or governmental rule or regulation applicable to the Company or
any of its subsidiaries, the violation of which would have a Material Adverse
Effect or (C) any decree of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries; or (ii) in default in
any material respect in the performance of any obligation, agreement or
condition contained in (A) any bond, debenture, note or any other evidence of
indebtedness or (B) any agreement, indenture, lease or other instrument (each of
(A) and (B), an “Existing
Instrument”) to
which the Company or any of its subsidiaries is a party or by which any of their
properties may be bound, which default would have a Material Adverse Effect;
and, to the Company’s knowledge, there does not exist any state of facts that
constitutes a default or an event of default on the part of the Company or any
of its subsidiaries as defined in such documents or that, with notice or lapse
of time or both, would constitute such a default or event of default which would
have a Material Adverse Effect.
(o) The
Company and the Operating Partnership have full legal right, power and authority
to enter into and perform this Agreement and to consummate the transactions
contemplated herein, including the issuance, sale and delivery of the Shares as
provided herein and the Operating Partnership’s issuance of the Common Units to
the Company. The Company’s and the Operating Partnership’s execution and
delivery of this Agreement and the performance by the Company and the Operating
Partnership of their obligations under this Agreement have been duly and validly
authorized by the Company and the Operating Partnership and this Agreement has
been duly executed and delivered by the Company and the Operating Partnership,
and constitutes a valid and legally binding agreement of the Company and the
Operating Partnership, enforceable against the Company and the Operating
Partnership in accordance with its terms, except to the extent enforceability
may be limited by (i) the application of bankruptcy, reorganization, insolvency
and other laws affecting creditors’ rights generally and (ii) equitable
principles being applied at the discretion of a court before which any
proceeding may be brought, and except as rights to indemnity and contribution
hereunder may be limited by federal or state securities laws.
(p) The
Second Amended and Restated Agreement of Limited Partnership of the Operating
Partnership, including all amendments thereto (the “Partnership
Agreement”), has been duly and validly authorized, executed and delivered
by or on behalf of the partners of the Operating Partnership and constitutes a
valid and binding agreement of the parties thereto, enforceable in accordance
with its terms, except to the extent that enforceability may be limited by
bankruptcy, insolvency, reorganization or other laws of general applicability
relating to or affecting creditors’ rights or by general equity
principles.
(q) No
consent, approval, authorization, order, license, certificate, permit,
registration, designation or filing by or with any governmental agency or body
is required for the execution, delivery and performance by the Company and the
Operating Partnership of their respective obligations under this Agreement and
the consummation by the Company and the Operating Partnership of the
transactions contemplated hereby, including the valid authorization, issuance,
sale and delivery of the Shares, except such as may be required by the federal
securities laws, the Exchange and the securities or Blue Sky laws of the various
states in connection with the offer and sale of the Shares, all of which will
be, or have been effected, in accordance with this Agreement.
(r) Neither
the issuance and sale of the Shares by the Company, the execution, delivery or
performance of this Agreement by the Company and the Operating Partnership nor
the consummation by the Company and the Operating Partnership of the
transactions contemplated hereby (i) conflicts with or will conflict with or
constitutes or will constitute a breach of, or a default under, the Company’s
charter or bylaws, the Operating Partnership’s certificate of limited
partnership or the Partnership Agreement, or any Existing Instrument to which
the Company or any of its subsidiaries is a party or by which any of its or
their properties may be bound, (iii) violates any statute, law, regulation,
ruling, filing, judgment, injunction, order or decree applicable to the Company
or any of its subsidiaries or any of their properties, or (iv) results in a
breach of, or default or Debt Repayment Triggering Event (as defined below)
under, or results in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, or requires the consent of any other party to, any
Existing Instrument, except for such conflicts, breaches, defaults, liens,
charges or encumbrances that will not, individually or in the aggregate, result
in a Material Adverse Effect. As used herein, a “Debt
Repayment Triggering Event” means any event or condition that gives, or
with the giving of notice or lapse of time would give, the holder of any note,
debenture or other evidence of indebtedness (or any person acting on such
holder’s behalf) the right to require the repurchase, redemption or repayment of
all or a portion of such indebtedness by the Company or any of its
subsidiaries.
(s) No
holder of any securities of the Company has rights to the registration of any
securities of the Company or other similar rights as a result of or in
connection with the filing of the Registration Statement or the consummation of
the transactions contemplated hereby that have not been satisfied or heretofore
waived in writing. No person or entity has a right of participation or first
refusal with respect to the sale of the Shares by the Company.
(t) Ernst & Young LLP, who have audited
the financial statements (including the related notes thereto and supporting
schedules) incorporated by reference in the Registration Statement and the
Prospectus, are and were, during the periods covered by their reports
incorporated by reference in the Registration Statement and the Prospectus,
independent registered public accountants as required by the Securities Act, the
Exchange Act and the Public Company Accounting Oversight Board (“PCAOB”); any other public
accountants who have audited the financial statements incorporated by reference
in the Registration Statement and the Prospectus, are and were, during the
periods covered by their reports incorporated by reference in the Registration
Statement and the Prospectus, independent registered public accountants as
required by the Securities Act, the Exchange Act and the PCAOB.
(u) The
financial statements, together with related schedules and notes, included or
incorporated by reference in the Registration Statement and the Prospectus,
present fairly the financial condition, results of operations, cash flows and
changes in financial position of the Company on the basis stated in the
Registration Statement at the respective dates or for the respective periods to
which they apply; except as disclosed therein, such statements and related
schedules and notes have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods involved and
the other financial and statistical information and data set forth in the
Registration Statement and Prospectus is accurately presented and prepared on a
basis consistent with such financial statements and the books and records of the
Company, except for the financial statements that have not been restated for
prior periods to reflect the reclassification of assets held for sale as
discontinued operations in accordance with Statement of Financial Accounting
Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived
Assets.” No other financial statements or schedules are required by
Form S-3 or otherwise to be included in the Registration Statement or the
Prospectus. The Company’s consolidated ratio of combined fixed charges and
preferred stock distributions and consolidated ratio of earnings to fixed
charges set forth in the Registration Statement and the Prospectus and Exhibit
12.1 to the Registration Statement have been calculated in compliance with Item
503(d) of Regulation S-K under the Securities Act.
(v) Except
as disclosed in the Registration Statement and the Prospectus, subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus, (i) neither the Company nor any of its
subsidiaries has incurred any material liabilities or obligations, indirect,
direct or contingent, or entered into any transaction that is not in the
ordinary course of business, (ii) neither the Company nor any of its
subsidiaries has sustained any material loss or interference with its business
or properties from fire, flood, windstorm, accident or other calamity, whether
or not covered by insurance, (iii) neither the Company nor any of its
subsidiaries has paid or declared any dividends or other distributions with
respect to its capital stock and the Company is not in default under the terms
of any class of capital stock of the Company or any outstanding debt
obligations, (iv) there has not been any change in the authorized or outstanding
capital stock of the Company or any material change in the indebtedness of the
Company (other than in the ordinary course of business) and (v) there has not
been any material adverse change, or any development involving or that may
reasonably be expected to result in a Material Adverse Effect.
(w) The
Shares to be sold under this Agreement have been approved for trading and
listing on the Exchange, subject to official notice of issuance, and are
registered pursuant to Section 12(b) of the Exchange Act, and the Company has
taken no action designed to, or likely to have the effect of, terminating the
registration of the Shares under the Exchange Act or delisting any such
securities from the Exchange, nor has the Company received any notification that
the Commission or the Exchange is contemplating terminating such registration or
listing.
(x) The Company has not distributed and
will not distribute, and has not authorized CF&Co. to distribute, any
offering material in connection with the offering and sale of the Shares to be
sold hereunder by CF&Co. as principal or agent for the Company, other than
the Prospectus and any Issuer Free Writing Prospectus (as defined in Rule 433)
reviewed and consented to by CF&Co. or identified in Schedule
3 hereto. The common stock is currently listed on the Exchange under the
trading symbol “MAA”
(y) Other than excepted activity pursuant
to Regulation M under the Exchange Act, the Company has not taken and will not
take, directly or indirectly, any action that constituted, or any action
designed to, or that might reasonably be expected to cause or result in or
constitute stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares or for any other
purpose.
(z) The Company and each of its
subsidiaries have filed all tax returns required to be filed (other than certain
state or local tax returns, as to which the failure to file, individually or in
the aggregate, would not have a Material Adverse Effect), which returns are
complete and correct in all material respects, and neither the Company nor any
subsidiary is in default in the payment of any taxes that were payable pursuant
to said returns or any assessments with respect thereto. Except as disclosed in
the Prospectus (as amended or supplemented), all deficiencies asserted as a
result of any federal, state, local or foreign tax audits have been paid or
finally settled and no issue has been raised in any such audit that, by
application of the same or similar principles, reasonably could be expected to
result in a proposed deficiency for any other period not so audited. There are
no outstanding agreements or waivers extending the statutory period of
limitation applicable to any federal, state, local or foreign tax return for any
period. On each Settlement Date, all stock transfer and other taxes that are
required to be paid in connection with the sale of the Shares will have been
fully paid by the Company and all laws imposing such taxes will have been
complied with.
(aa) Except
as set forth in the Prospectus (as amended or supplemented), there are no
transactions with “affiliates” (as defined in Rule 405 promulgated under the
Securities Act) or any officer, director or security holder of the Company
(whether or not an affiliate) that are required by the Securities Act to be
disclosed in the Prospectus that have not been disclosed as required.
Additionally, no relationship, direct or indirect, exists between the Company or
any of its subsidiaries on the one hand, and the directors, officers,
stockholders, customers or suppliers of the Company or any subsidiary on the
other hand that is required by the Securities Act to be disclosed in the
Prospectus that is not so disclosed.
(bb) None
of the Company nor any of its subsidiaries is an “investment company”, a company
“controlled” by an “investment company” or an “affiliated person” of, or
“promoter” or “principal underwriter” for, an investment company within the
meaning of the Investment Company Act of 1940, as amended.
(cc) Each
of the Company and its subsidiaries has good and valid title to all property
(real and personal) described in the Prospectus as being owned by it, free and
clear of all liens, claims, security interests or other encumbrances except (i)
such as are described in the Prospectus or (ii) such as are not materially
burdensome and do not have or will not adversely affect the Company’s or
subsidiaries’ use of the property or the conduct of the business of the Company.
All property (real and personal) leased by the Company and its subsidiaries is
held under valid, subsisting and enforceable leases with only such exceptions as
in the aggregate are not materially burdensome and do not or will not adversely
affect the use of the property or the conduct of the business of the
Company.
(dd) The
Company and its subsidiaries have all permits, licenses, franchises, approvals,
consents and authorizations of governmental or regulatory authorities
(hereinafter “permit” or “permits”) as are
necessary to own their properties and to conduct their business in the manner
described in the Prospectus, subject to such qualifications as may be set forth
in the Prospectus, except where the failure to have obtained any such permit has
not had and will not have a Material Adverse Effect; each of the Company and its
subsidiaries has operated and is operating its business in material compliance
with all of its obligations with respect to each such permit and no event has
occurred that allows, or after notice or lapse of time would allow, revocation
or termination of any such permit and except where such revocation or
termination would not have a Material Adverse Effect or result in any other
material impairment of the rights of any such permit, subject in each case to
such qualification as may be set forth in the Prospectus; and, except as
described in the Prospectus, such permits contain no restrictions that are
materially burdensome to the Company or any of its subsidiaries.
(ee) The
Company and its subsidiaries have implemented controls and other procedures that
are designed to ensure that information required to be disclosed by the Company
in the reports that it files or submits under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the
Commission’s rules and forms and is accumulated and communicated to the
Company’s management, including its chief executive officer and chief financial
officer, or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure; and the Company makes and keeps books,
records, and accounts which, in reasonable detail, accurately and fairly reflect
the transactions and dispositions of the assets of the Company and its
subsidiaries; and the Company and its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management’s general or
specific authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management’s
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences; and, to the Company’s and the
Operating Partnership’s knowledge, neither the Company, the Operating
Partnership nor any subsidiary, nor any employee or agent thereof, has made any
payment of funds of the Company, the Operating Partnership or any of the
subsidiaries, as the case may be, or received or retained any funds, and no
funds of the Company, the Operating Partnership or any of the subsidiaries, as
the case may be, have been set aside to be used for any payment, in each case in
violation of any law, rule or regulation.
(ff) Neither
the Company nor any of its subsidiaries, since each has been a subsidiary of the
Company, nor, to the Company’s knowledge, any employee or agent of the Company
or any of its subsidiaries, has, directly or indirectly, (i) made any unlawful
contribution to any candidate for political office, or failed to disclose fully
any contribution in violation of law or (ii) made any payment to any federal,
state, local or foreign governmental official, or other person charged with
similar public or quasi-public duties, other than payments required or permitted
by the laws of the United States or any jurisdiction thereof or applicable
foreign jurisdictions.
(gg) The
Company and its subsidiaries are (i) in compliance with any and all applicable
federal, state, local and foreign laws and regulations relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (“Environmental
Laws”), (ii) have received all permits, licenses or other approvals
required of them under applicable Environmental Laws to conduct their respective
businesses and (iii) are in compliance with all terms and conditions of any such
permit, license or approval, except where such noncompliance with Environmental
Laws, failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits, licenses or
other approvals would not, individually or in the aggregate, have a Material
Adverse Effect. Neither the Company nor any of its subsidiaries has been named
as a “potentially responsible party” under the Comprehensive Environmental
Response Compensation and Liability Act of 1980, as amended. Neither the Company
nor any of its subsidiaries owns, leases or occupies any property that appears
on any list of hazardous sites compiled by any state or local governmental
agency.
(hh) There
are no costs or liabilities associated with Environmental Laws (including,
without limitation, any capital or operating expenditures required for clean-up,
closure of properties or compliance with Environmental Laws or any permit,
license or approval, any related constraints on operating activities and any
potential liabilities to third parties) that would, singly or in the aggregate,
have a Material Adverse Effect.
(ii) The
Company has been organized and has operated in conformity with the requirements
for qualification and taxation as a real estate investment trust under the
Internal Revenue Code of 1986, as amended (the “Code”) for its taxable years ended
December 31, 1994 through December 31, 2008, and the Company’s current and
proposed method of operation will enable it to continue to meet the requirements
for taxation as a real estate investment trust under the Code for its taxable
year ending December 31, 2009 and in the future. The subsidiaries of the Company
that are partnerships have been and will continue to be treated as partnerships
for federal income tax purposes and not as corporations, associations taxable as
corporations or as publicly traded partnerships.
(jj) The
Company will use its best efforts to monitor the ownership of the Company’s
capital stock to ensure that (i) the Limited Waiver of Excess Share Limitation
(the “C&S
Limited Waiver”), by and between the Company and ▇▇▇▇▇ & Steers
Capital Management, Inc. (“▇▇▇▇▇
& Steers”), dated January 2005, and (ii) the Limited Waiver of Excess
Share Limitation (the “MS
Limited Waiver”), by and between the Company and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Investment Management Inc. (“▇▇▇▇▇▇
▇▇▇▇▇▇▇”), dated March 22, 2007, will not cause the Company to fail to
satisfy the requirements of section 856(a)(6) of the Code, including, without
limitation, making periodic inquiries regarding the ownership of the capital
stock of the Company by ▇▇▇▇▇ & Steers and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and making
periodic reviews of the ownership of the capital stock of the Company by other
stockholders; the Company will, if necessary to prevent a violation of the
requirements of section 856(a)(6) of the Code, promptly exercise the power in
section 1(c) of the C&S Limited Waiver or Section 3 of the MS Limited Waiver
to revoke the excess share limitation granted to ▇▇▇▇▇ & Steers pursuant to
the C&S Limited Waiver and/or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ pursuant to the MS Limited
Waiver.
(kk) The
Company and its subsidiaries own and have full right, title and interest in and
to, or has valid licenses to use, each material trade name, trademark, service
▇▇▇▇, patent, copyright, approval, trade secret and other similar rights
(collectively “Intellectual
Property”) under which the Company and its subsidiaries conduct all or
any material part of their business, and none of the Company and its
subsidiaries has created any lien or encumbrance on, or granted any right or
license with respect to, any such Intellectual Property except where the failure
to own or obtain a license or right to use any such Intellectual Property has
not and will not have a Material Adverse Effect; there is no claim pending
against the Company or any of its subsidiaries with respect to any Intellectual
Property, and none of the Company and its subsidiaries has received notice or
otherwise become aware that any Intellectual Property that it uses or has used
in the conduct of its business infringes upon or conflicts with the rights of
any third party. Neither the Company nor any of its subsidiaries has become
aware that any material Intellectual Property that it uses or has used in the
conduct of its business infringes upon or conflicts with the rights of any third
party.
(ll) Title
insurance in favor of the Company, the Operating Partnership and the
subsidiaries has been obtained with respect to each property owned by any such
entity in an amount at least equal to (A) the cost of acquisition of such
property or (B) the cost of construction of such property (measured at the
time of such construction), except where the failure to maintain such title
insurance would not have a Material Adverse Effect.
(mm) In
the ordinary course of its business, the Company conducts a periodic review of
the effect of Environmental Laws on the business, operations and properties of
the Company and its subsidiaries, in the course of which it identifies and
evaluates associated costs and liabilities (including any capital or operating
expenditures required for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related constraints
on operating activities and any potential liabilities to third parties). On the
basis of such review and amount of its established reserves, the Company has
reasonably concluded that such associated costs and liabilities would not,
individually or in the aggregate, result in a Material Adverse
Effect.
(nn) The
Company and its subsidiaries and any “employee benefit plan” (as defined under
the Employee Retirement Income Security Act of 1974, as amended, and the
regulations and published interpretations thereunder (collectively, “ERISA”))
established or maintained by the Company, its subsidiaries or their ERISA
Affiliates (as defined below) are in compliance in all material respects with
ERISA and all other applicable state and federal laws. “ERISA
Affiliate” means, with respect to the Company or a subsidiary, any member
of any group or organization described in Sections 414(b), (c), (m) or (o) of
the Code of which the Company or such subsidiary is a member. No “reportable
event” (as defined in ERISA) has occurred or is reasonably expected to occur
with respect to any “employee benefit plan” established or maintained by the
Company, its subsidiaries or any of their ERISA Affiliates. No “employee benefit
plan” established or maintained by the Company, its subsidiaries or any of their
ERISA Affiliates, if such “employee benefit plan” were terminated, would have
any “amount of unfunded benefit liabilities” (as defined in ERISA). Neither the
Company, its subsidiaries nor any of their ERISA Affiliates has incurred or
reasonably expects to incur any liability under (i) Title IV of ERISA with
respect to termination of, or withdrawal from, any “employee benefit plan” or
(ii) Sections 412, 4971, 4975 or 4980B of the Code. Each “employee benefit plan”
established or maintained by the Company, its subsidiaries or any of their ERISA
Affiliates that is intended to be qualified under Section 401(a) of the Code is
so qualified and nothing has occurred, whether by action or failure to act, that
would cause the loss of such qualification.
(oo) The
Company and its subsidiaries have complied and will comply in all material
respects with wage and hour determinations issued by the U.S. Department of
Labor under the Service Contract Act of 1965 and the Fair Labor Standards Act in
paying its employees’ salaries, fringe benefits and other compensation for the
performance of work or other duties in connection with contracts with the U.S.
government, except where the failure to do so would not have a Material Adverse
Effect, and have complied and will comply in all material respects with the
requirements of the Americans with Disabilities Act of 1990, the Family and
Medical Leave Act of 1993, the Civil Rights Act of 1964 (Title VII), the
National Labor Relations Act, the Vietnam Era Veteran’s Readjustment Act, the
Age Discrimination in Employment Act, as amended by the Older Workers’ Benefit
Protection Act, and federal, state and local labor laws, each as amended except
where the failure to comply with any such requirements has not, and will not,
have a Material Adverse Effect.
(pp) Except
with respect to the non-timely filings of reports pursuant to Section 16(a) of
the Exchange Act by certain of the Company’s officers as described in the
Company’s most recently filed Definitive Proxy Statement under the caption
“Section 16(a) Beneficial Ownership Reporting Compliance,” there is and has been
no failure on the part of the Company, the Operating Partnership and the
subsidiaries and any of the officers and directors of the Company, the Operating
Partnership and any of the subsidiaries, in their capacities as such, to comply
in all material respects with the provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002
and the rules and regulations promulgated thereunder.
(qq) The
principal executive officer and principal financial officer of the Company have
made all certifications required by Sections 302 and 906 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act of 2002 and the rules and regulations promulgated in connection therewith
(the “▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act”) with respect to all reports, schedules, forms,
statements and other documents required to be filed by it with the Commission,
and the statements contained in any such certification are complete and correct.
The Company is in compliance in all material respects with all applicable
effective provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act (and intends to comply with all
applicable provisions that are not yet effective upon
effectiveness).
(rr) Other than this Agreement, 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 any of its subsidiaries or CF&Co for a brokerage commission,
finder’s fee or other like payment with respect to the consummation of the
transactions contemplated by this Agreement.
(ss) The Company acknowledges and agrees
that CF&Co has informed the Company that CF&Co may, to the extent
permitted under the Securities Act and the Exchange Act, purchase and sell
shares of Common Stock for its own account while this Agreement is in effect;
provided, that (i) no
such purchase or sales shall take place while a Placement Notice is in effect
(except to the extent CF&Co may engage in sales of Placement Shares
purchased or deemed purchased from the Company as a “riskless principal” or in a
similar capacity) and (ii) the Company shall not be deemed to have authorized or
consented to any such purchases or sales by CF&Co.
(tt) Any certificate signed by an officer of
the Company and delivered to CF&Co or to counsel for CF&Co shall be
deemed to be a representation and warranty by the Company and/or the Operating
Partnership, as applicable, to CF&Co as to the matters set forth
therein.
(uu) The Company and the Operating
Partnership acknowledge that CF&Co and, for purposes of the opinions to be
delivered pursuant to Section 7 hereof,
counsel to the Company and counsel to CF&Co, will rely upon the accuracy and
truthfulness of the foregoing representations and hereby consents to such
reliance.
(vv) The Company has established,
maintained, and evaluated “disclosure controls and procedures” (as such term is
defined in Rule 13a-15 and 15d-15 under the Exchange Act). Such disclosure
controls and procedures 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, and such disclosure controls and procedures are
believed to be effective to perform the functions for which they were
established. The Company’s auditors have been advised of (i) any significant
deficiencies and material weaknesses known to management in the design or
operation of internal controls over financial reporting that are reasonably
likely to adversely affect the Company’s ability to record, process, summarize,
and report financial data; and (ii) any fraud, whether or not material, known to
management that involves management or other employees who have a role in the
Company’s internal controls over financial reporting. Except as set
forth in the Prospectus, since the date of the most recent evaluation of such
disclosure controls or procedures, there have been no changes in the internal
controls over financial reporting that have materially affected or are
reasonably likely to materially affect internal controls over financial
reporting, including any corrective actions with regard to significant
deficiencies and material weaknesses.
(ww) Forward Looking
Statements. No forward looking statement within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act contained
in the Prospectus, the Registration Statement, or any other document filed with
the Commission has been made or reaffirmed without a reasonable basis or has
been disclosed other than in good faith.
7. Covenants of the
Company. The Company and the Operating Partnership, jointly
and severally, covenant and agree with CF&Co that:
(a) Registration Statement
Amendments; Payment of Fees. After the date of this Agreement
and during any period in which a Prospectus relating to any Placement Shares is
required to be delivered by CF&Co under the Securities Act (including in
circumstances where such requirement may be satisfied pursuant to Rule 172
under the Securities Act), (i) the Company will notify CF&Co promptly
of the time when any subsequent amendment to the Registration Statement, other
than documents incorporated by reference, has been filed with the Commission
and/or has become effective or any subsequent supplement to the Prospectus has
been filed and of any comment letter from the Commission or any request by the
Commission for any amendment or supplement to the Registration Statement or
Prospectus or for additional information, (ii) the Company will prepare and file
with the Commission, promptly upon CF&Co’s request, any amendments or
supplements to the Registration Statement or Prospectus that, in CF&Co’s
reasonable opinion, may be necessary or advisable in connection with the
distribution of the Placement Shares by CF&Co (provided, however, that the
failure of CF&Co to make such request shall not relieve the Company of any
obligation or liability hereunder, or affect CF&Co’s right to rely on the
representations and warranties made by the Company in this Agreement); (iii) the
Company will not file any amendment or supplement to the Registration Statement
or Prospectus, other than documents incorporated by reference, relating to the
Placement Shares or a security convertible into the Placement Shares unless a
copy thereof has been submitted to CF&Co within a reasonable period of time
before the filing and CF&Co has not reasonably objected thereto (provided, however, that the
failure of CF&Co to make such objection shall not relieve the Company of any
obligation or liability hereunder, or affect CF&Co’s right to rely on the
representations and warranties made by the Company in this Agreement) and the
Company will furnish to CF&Co at the time of filing thereof a copy of any
document that upon filing is deemed to be incorporated by reference into the
Registration Statement or Prospectus, except for those documents available via
▇▇▇▇▇; and (iv) the Company will cause each amendment or supplement to the
Prospectus, other than documents incorporated by reference, to be filed with the
Commission as required pursuant to the applicable paragraph of Rule 424(b) of
the Securities Act (without reliance on Rule 424(b)(8) of the Securities
Act.
(b) Notice of Commission Stop
Orders. The Company will advise CF&Co, promptly after it
receives notice or obtains knowledge thereof, of the issuance or threatened
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or any other order preventing or suspending the use of
the Prospectus, of the suspension of the qualification of the Placement Shares
for offering or sale in any jurisdiction, or of the initiation or threatening of
any proceeding for any such purpose or any examination pursuant to Section 8(e)
of the Securities Act, or if the Company becomes the subject of a proceeding
under Section 8A of the Securities Act in connection with the offering of the
Shares; and it will promptly use its commercially reasonable efforts to prevent
the issuance of any stop or other order or to obtain its withdrawal if such a
stop or other order should be issued.
(c) Delivery of Prospectus;
Subsequent Changes. During any period in which a Prospectus
relating to the Placement Shares is required to be delivered by CF&Co under
the Securities Act with respect to a pending sale of the Placement Shares,
(including in circumstances where such requirement may be satisfied pursuant to
Rule 172 under the Securities Act), the Company will comply with all
requirements imposed upon it by the Securities Act, as from time to time in
force, and to file on or before their respective due dates all reports and any
definitive proxy or information statements required to be filed by the Company
with the Commission pursuant to Sections 13(a), 13(c), 14, 15(d) or any other
provision of or under the Exchange Act. If during such period any
event occurs as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
then existing, not misleading, or if during such period it is necessary to amend
or supplement the Registration Statement or Prospectus to comply with the
Securities Act, the Company will promptly notify CF&Co to suspend the
offering of Placement Shares during such period and the Company will promptly
amend or supplement the Registration Statement or Prospectus (at the expense of
the Company) so as to correct such statement or omission or effect such
compliance.
(d) Listing of Placement
Shares. During any period in which the Prospectus relating to
the Placement Shares is required to be delivered by CF&Co under the
Securities Act with respect to a pending sale of the Placement Shares (including
in circumstances where such requirement may be satisfied pursuant to Rule 172
under the Securities Act), the Company will use its commercially reasonable
efforts to cause the Placement Shares to be listed on the Exchange and to
qualify the Placement Shares for sale under the securities laws of such
jurisdictions as CF&Co reasonably designates and to continue such
qualifications in effect so long as required for the distribution of the
Placement Shares; provided,
however, that the Company shall not be required in connection therewith
to qualify as a foreign entity or dealer in securities or file a general consent
to service of process in any jurisdiction.
(e) Filings with the
Exchange. The Company will timely file with the Exchange all
material documents and notices required by the Exchange of companies that have
or will issue securities that are traded on the Exchange.
(f) Delivery of Registration
Statement and Prospectus. The Company will furnish to
CF&Co and its counsel (at the expense of the Company) copies of the
Registration Statement, the Prospectus (including all documents incorporated by
reference therein) and all amendments and supplements to the Registration
Statement or Prospectus that are filed with the Commission during any period in
which a Prospectus relating to the Placement Shares is required to be delivered
under the Securities Act (including all documents filed with the Commission
during such period that are deemed to be incorporated by reference therein), in
each case as soon as reasonably practicable and in such quantities as CF&Co
may from time to time reasonably request and, at CF&Co’s request, will also
furnish copies of the Prospectus to each exchange or market on which sales of
the Placement Shares may be made. The copies of the Registration
Statement and the Prospectus and any supplements or amendments thereto furnished
to CF&Co will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
(g) Earnings
Statement. The Company will make generally available to its
security holders as soon as practicable, but in any event not later than 15
months after the end of the Company’s current fiscal quarter, an earnings
statement covering a 12-month period that satisfies the provisions of Section
11(a) and Rule 158 of the Securities Act. “Earnings statement” and
make “generally available to its security holders” will have the meanings
contained in Rule 158 under the Securities Act.
(h) Expenses. The
Company, whether or not the transactions contemplated hereunder are consummated
or this Agreement is terminated, in accordance with the provisions of Section 11
hereunder, will pay all expenses incident to the performance of its obligations
hereunder, including, but not limited to, expenses relating to (i) the
preparation, printing and filing of the Registration Statement and each
amendment and supplement thereto, of each Prospectus and of each amendment and
supplement thereto, (ii) the preparation, issuance and delivery of the Placement
Shares, (iii) the qualification of the Placement Shares under securities laws in
accordance with the provisions of Section 7(d) of this
Agreement, including filing fees, (iv) the printing and delivery to CF&Co of
copies of the Prospectus and any amendments or supplements thereto, and of this
Agreement, (v) the fees and expenses incurred in connection with the listing or
qualification of the Placement Shares for trading on the Exchange, and (vi)
filing fees and expenses, if any, of the Commission and the Financial Industry
Regulatory Authority (“FINRA”), Corporate Financing
Department.
(i) Use of
Proceeds. The Company will apply the net proceeds from the
sale of the Shares to be sold by it hereunder in accordance in all material
respects with the statements under the caption “Use of Proceeds” in the
Prospectus. The Company will effect the issuance to the Company by the Operating
Partnership of a number of Common Units equal to the number of Shares sold
pursuant to this Agreement upon the Company’s contribution to the Operating
Partnership of the proceeds from the sale of the Shares.
(j) Notice of Other
Sales. During the pendency of any Placement Notice given
hereunder, the Company shall provide CF&Co notice as promptly as reasonably
possible before it offers to sell, contracts to sell, sells, grants any option
to sell or otherwise disposes of any shares of Common Stock (other than
Placement Shares offered pursuant to the provisions of this Agreement) or
securities convertible into or exchangeable for Common Stock, warrants or any
rights to purchase or acquire Common Stock; provided, that such notice
shall not be required in connection with the (i) issuance, grant or sale of
Common Stock, options to purchase Common Stock or Common Stock issuable upon the
exercise of options or other equity awards pursuant to any stock option, stock
bonus or other stock or compensatory plan or arrangement described in the
Prospectus, (ii) the issuance of securities in connection with an acquisition,
merger or sale or purchase of assets described in the Prospectus, (iii) the
issuance or sale of Common Stock pursuant to any dividend reinvestment plan that
the Company may adopt from time to time provided the implementation of such is
disclosed to CF&Co in advance, (iv) any Common Stock issuable upon the
redemption of outstanding Common Units in accordance with the Operating
Partnership Agreement.
(k) Change of
Circumstances. The Company will, at any time during a fiscal
quarter in which the Company intends to tender a Placement Notice or sell
Placement Shares, advise CF&Co promptly after it shall have received notice
or obtained knowledge thereof, of any information or fact that would alter or
affect in any material respect any opinion, certificate, letter or other
document provided to CF&Co pursuant to this Agreement.
(l) Due Diligence
Cooperation. The Company and the Operating Partnership will
cooperate with any reasonable due diligence review conducted by CF&Co or its
agents in connection with the transactions contemplated hereby, including,
without limitation, providing information and making available documents and
senior officers, during regular business hours and at the Company’s principal
offices, as CF&Co may reasonably request.
(m) Required Filings Relating to
Placement of Placement Shares. The Company agrees that on such
dates as the Securities Act shall require, the Company will (i) file a
prospectus supplement with the Commission under the applicable paragraph of Rule
424(b) under the Securities Act, which prospectus supplement will set forth,
within the relevant period, the amount of Placement Shares sold through
CF&Co, the Net Proceeds to the Company and the compensation payable by the
Company to CF&Co with respect to such Placement Shares, and (ii) deliver
such number of copies of each such prospectus supplement to each exchange or
market on which such sales were effected as may be required by the rules or
regulations of such exchange or market.
(n) Representation Dates;
Certificate. On or prior to the date that the first Shares are
sold pursuant to the terms of this Agreement and each time the Company (i) files
the Prospectus relating to the Placement Shares or amends or supplements the
Registration Statement or the Prospectus relating to the Placement Shares (other
than a prospectus supplement filed in accordance with Section 7(m) of this
Agreement) by means of a post-effective amendment, sticker, or supplement but
not by means of incorporation of documents by reference into the Registration
Statement or the Prospectus relating to the Placement Shares; (ii) files an
annual report on Form 10-K under the Exchange Act; (iii) files its quarterly
reports on Form 10-Q under the Exchange Act; or (iv) files a report on Form 8-K
containing amended financial information (other than an earnings release, to
“furnish” information pursuant to Items 2.02 or 7.01 of Form 8-K or to provide
disclosure pursuant to Item 8.01 of Form 8-K relating to the reclassifications
of certain properties as discontinued operations in accordance with Statement of
Financial Accounting Standards No. 144) under the Exchange Act (each date of
filing of one or more of the documents referred to in clauses (i) through (iv)
shall be a “Representation
Date”); the
Company shall furnish CF&Co with a certificate, in the form attached hereto
as Exhibit 7(n)
within three (3) Trading Days of any Representation Date if requested by
CF&Co. The requirement to provide a certificate under this Section 7(n) shall be
waived for any Representation Date occurring at a time at which no Placement
Notice is pending, which waiver shall continue until the earlier to occur of the
date the Company delivers a Placement Notice hereunder (which for such calendar
quarter shall be considered a Representation Date) and the next occurring
Representation Date; provided, however, that such waiver
shall not apply for any Representation Date on which the Company files its
annual report on Form 10-K. Notwithstanding the foregoing, if the
Company subsequently decides to sell Placement Shares following a Representation
Date when the Company relied on such waiver and did not provide CF&Co with a
certificate under this Section 7(n), then
before the Company delivers the Placement Notice or CF&Co sells any
Placement Shares, the Company shall provide CF&Co with a certificate, in the
form attached hereto as Exhibit 7(n), dated
the date of the Placement Notice.
(o) Legal
Opinion. On or prior to the date that the first Shares are
sold pursuant to the terms of this Agreement and within three (3) Trading Days
of each Representation Date with respect to which the Company is obligated to
deliver a certificate in the form attached hereto as Exhibit 7(n) for
which no waiver is applicable, the Company shall cause to be furnished to
CF&Co a written opinion of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
PC (“Company
Counsel”), or other counsel satisfactory to CF&Co, in form and
substance satisfactory to CF&Co and its counsel, dated the date that the
opinion is required to be delivered, substantially similar to the form attached
hereto as Exhibit
7(o)(1)(a) and Exhibit 7(o)(1)(b),
respectively, modified, as necessary, to relate to the Registration Statement
and the Prospectus as then amended or supplemented; provided, however, that in lieu of such
opinions for subsequent Representation Dates, counsel may furnish CF&Co with
a letter (a “Reliance
Letter”) to the effect that CF&Co may rely on a prior opinion
delivered under this Section 7(o) to the
same extent as if it were dated the date of such letter (except that statements
in such prior opinion shall be deemed to relate to the Registration Statement
and the Prospectus as amended or supplemented at such Representation
Date).
(p) Comfort
Letter. On or prior to the date that the first Shares are sold
pursuant to the terms of this Agreement and within three (3) Trading Days of
each Representation Date with respect to which the Company is obligated to
deliver a certificate in the form attached hereto as Exhibit 7(n) for
which no waiver is applicable, the Company shall cause its independent
accountants (and any other independent accountants whose report is included in
the Registration Statement or the Prospectus) to furnish CF&Co letters (the
“Comfort
Letters”), dated
the date of the Comfort Letter is delivered, in form and substance satisfactory
to CF&Co, (i) confirming that they are an independent registered public
accounting firm within the meaning of the Securities Act, the Exchange Act and
the PCAOB, (ii) stating, as of such date, the conclusions and findings of such
firm with respect to the financial information and other matters ordinarily
covered by accountants’ “comfort letters” to underwriters in connection with
registered public offerings (the first such letter, the “Initial
Comfort Letter”)
and (iii) updating the Initial Comfort Letter with any information that would
have been included in the Initial Comfort Letter had it been given on such date
and modified as necessary to relate to the Registration Statement and the
Prospectus, as amended and supplemented to the date of such letter.
(q) Market
Activities. The Company will not, directly or indirectly, (i)
take any action designed to cause or result in, or that constitutes or might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
Shares or (ii) sell, bid for, or purchase the Shares to be issued and sold
pursuant to this Agreement, or pay anyone any compensation for soliciting
purchases of the Shares to be issued and sold pursuant to this Agreement other
than CF&Co; provided, however, that the Company may bid for and purchase its
Common Stock in accordance with Rule 10b-18 under the Exchange Act.
(r) Insurance. The
Company and its subsidiaries shall maintain, or caused to be maintained,
insurance in such amounts and covering such risks as is reasonable and customary
for companies engaged in similar businesses in similar industries.
(s) Compliance with
Laws. The Company and each of its subsidiaries shall maintain,
or cause to be maintained, all material environmental permits, licenses and
other authorizations required by federal, state and local law in order to
conduct their businesses as described in the Prospectus, and the Company and
each of its subsidiaries shall conduct their businesses, or cause their
businesses to be conducted, in substantial compliance with such permits,
licenses and authorizations and with applicable environmental laws, except where
the failure to maintain or be in compliance with such permits, licenses and
authorizations could not reasonably be expected to have a Material Adverse
Effect.
(t) REIT
Treatment. The Company currently intends to continue to elect
to qualify as a real estate investment trust under the Code and will use all
reasonable efforts to enable the Company to continue to meet the requirements
for qualification and taxation as a REIT under the Code for subsequent tax years
that include any portion of the term of this Agreement.
(u) Investment Company
Act. The Company will conduct its affairs in such a manner so
as to reasonably ensure that neither it nor its subsidiaries will be or become,
at any time prior to the termination of this Agreement, an “investment company,”
as such term is defined in the Investment Company Act, assuming no change in the
Commission’s current interpretation as to entities that are not considered an
investment company.
(v) Securities Act and Exchange
Act. The Company will use its best efforts to comply with all
requirements imposed upon it by the Securities Act and the Exchange Act as from
time to time in force, so far as necessary to permit the continuance of sales
of, or dealings in, the Placement Shares as contemplated by the provisions
hereof and the Prospectus.
(w) No Offer to
Sell. Other than a free writing prospectus (as defined in Rule
405 under the Securities Act) approved in advance in writing by the Company and
CF&Co in its capacity as principal or agent hereunder, neither CF&Co nor
the Company (including its agents and representatives, other than CF&Co in
its capacity as such) will, directly or indirectly, make, use, prepare,
authorize, approve or refer to any free writing prospectus relating to the
Shares to be sold by CF&Co as principal or agent hereunder.
(x) ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act. The Company and the Subsidiaries will maintain and keep
accurate books and records reflecting their assets and maintain internal
accounting controls in a manner designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted
accounting principles and including those policies and procedures that (i)
pertain to the maintenance of records that in reasonable detail accurately and
fairly reflect the transactions and dispositions of the assets of the Company,
(ii) provide reasonable assurance that transactions are recorded as necessary to
permit the preparation of the Company’s consolidated financial statements in
accordance with generally accepted accounting principals , (iii) that receipts
and expenditures of the Company are being made only in accordance with
management’s and the Company’s directors’ authorization, and (iv) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the Company’s assets that could have a
material effect on its financial statements. The Company and the
Subsidiaries will maintain such controls and other procedures, including,
without limitation, those required by Sections 302 and 906 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act, and the applicable regulations thereunder that are designed to ensure that
information required to be disclosed by the Company in the reports that it files
or submits under the Exchange Act is recorded, processed, summarized and
reported, within the time periods specified in the Commission’s rules and forms,
including, without limitation, controls and procedures designed to ensure that
information required to be disclosed by the Company in the reports that it files
or submits under the Exchange Act is accumulated and communicated to the
Company’s management, including its Chief Executive Officer and principal
financial officer, or persons performing similar functions, as appropriate to
allow timely decisions regarding required disclosure and to ensure that material
information relating to the Company or the Subsidiaries is made known to them by
others within those entities, particularly during the period in which such
periodic reports are being prepared. The Company and the Subsidiaries
will use their best efforts to comply with all effective applicable provisions
of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act.
8. Conditions to CF&Co’s
Obligations. The obligations of CF&Co hereunder with respect to a
Placement will be subject to the continuing accuracy and completeness of the
representations and warranties made by the Company and the Operating Partnership
herein, to the due performance by the Company and the Operating Partnership of
their respective obligations hereunder, to the completion by CF&Co of a due
diligence review satisfactory to CF&Co in its reasonable judgment, and to
the continuing satisfaction (or waiver by CF&Co in its sole discretion) of
the following additional conditions:
(a) Registration Statement
Effective. The Registration Statement shall be effective and
shall be available for (i) all sales of Placement Shares issued pursuant to all
prior Placement Notices and (ii) the sale of all Placement Shares contemplated
to be issued by any Placement Notice.
(b) No Material
Notices. None of the following events shall have occurred and
be continuing: (i) receipt by the Company or any of its subsidiaries
of any request for additional information from the Commission or any other
federal or state governmental authority during the period of effectiveness of
the Registration Statement, the response to which would require any
post-effective amendments or supplements to the Registration Statement or the
Prospectus; (ii) the issuance by the Commission or any other federal or
state governmental authority of any stop order suspending the effectiveness of
the Registration Statement or the initiation of any proceedings for that
purpose; (iii) receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of any of the
Placement Shares for sale in any jurisdiction or the initiation or threatening
of any proceeding for such purpose; (iv) the occurrence of any event that makes
any material statement made in the Registration Statement or the Prospectus or
any material document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires the making of any
changes in the Registration Statement, related Prospectus or such documents so
that, in the case of the Registration Statement, it will not contain any
materially 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
not misleading and, that in the case of the Prospectus, it will not contain any
materially 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 under which they were made, not
misleading.
(c) No Misstatement or Material
Omission. CF&Co shall not have advised the Company that
the Registration Statement or Prospectus, or any amendment or supplement
thereto, contains an untrue statement of fact that in CF&Co’s reasonable
opinion is material, or omits to state a fact that in CF&Co’s opinion is
material and is required to be stated therein or is necessary to make the
statements therein not misleading.
(d) Material
Changes. Except as contemplated in the Prospectus, or
disclosed in the Company’s reports filed with the Commission, there shall not
have been any material adverse change, on a consolidated basis, in the
authorized capital stock of the Company or the Operating Partnership or any
Material Adverse Effect, or any development that could reasonably be expected to
cause a Material Adverse Effect, or any downgrading in or withdrawal of the
rating assigned to any of the Company’s or the Operating Partnership’s
securities (other than asset backed securities) by any rating organization or a
public announcement by any rating organization that it has under surveillance or
review its rating of any of the Company’s or the Operating Partnership’s
securities (other than asset backed securities), the effect of which, in the
case of any such action by a rating organization described above, in the
reasonable judgment of CF&Co (without relieving the Company or the Operating
Partnership of any obligation or liability it may otherwise have), is so
material as to make it impracticable or inadvisable to proceed with the offering
of the Placement Shares on the terms and in the manner contemplated in the
Prospectus.
(e) Legal
Opinion. CF&Co shall have received the opinions of Company
Counsel required to be delivered pursuant Section 7(o) on or
before the date on which such delivery of such opinion is required pursuant to
Section
7(o).
(f) Comfort
Letter. CF&Co shall have received the Comfort Letter
required to be delivered pursuant Section 7(p) on or
before the date on which such delivery of such opinion is required pursuant to
Section
7(p).
(g) Representation
Certificate. CF&Co shall have received the certificate
required to be delivered pursuant to Section 7(n) on
or before the date on which delivery of such certificate is required pursuant to
Section
7(n).
(h) No
Suspension. Trading in the Shares shall not have been
suspended on the Exchange.
(i) Other
Materials. On each date on which the Company is required to
deliver a certificate pursuant to Section 7(n), the
Company and the Operating Partnership shall have furnished to CF&Co such
appropriate further information, certificates and documents as CF&Co may
have reasonably requested. All such opinions, certificates, letters and other
documents shall have been in compliance with the provisions hereof. The Company
and the Operating Partnership shall have furnished CF&Co with such conformed
copies of such opinions, certificates, letters and other documents as CF&Co
shall have reasonably requested.
(j) Securities Act Filings
Made. All filings with the Commission required by Rule 424
under the Securities Act to have been filed prior to the issuance of any
Placement Notice hereunder shall have been made within the applicable time
period prescribed for such filing by Rule 424.
(k) Approval for
Listing. The Placement Shares shall either have been (i)
approved for listing on the Exchange, subject only to notice of issuance, or
(ii) the Company shall have filed an application for listing of the Placement
Shares on the Exchange at, or prior to, the issuance of any Placement
Notice.
(l) No Termination
Event. There shall not have occurred any event that would
permit CF&Co to terminate this Agreement pursuant to Section
11(a).
9. Indemnification and
Contribution.
(a) Company and Operating
Partnership Indemnification. The Company and the Operating
Partnership, jointly and severally, agree to indemnify and hold harmless
CF&Co, the directors, officers, partners, employees and agents of CF&Co
and each person, if any, who (i) controls CF&Co within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, or (ii) is
controlled by or is under common control with CF&Co (a “CF&Co
Affiliate”) from and against any and all losses, claims, liabilities,
expenses and damages (including, but not limited to, any and all reasonable
investigative, legal and other expenses incurred in connection with,
and any and all amounts paid in settlement (in accordance with Section 9(c)) of, any
action, suit or proceeding between any of the indemnified parties and any
indemnifying parties or between any indemnified party and any third party, or
otherwise, or any claim asserted), as and when incurred, to which CF&Co, or
any such person, may become subject under the Securities Act, the Exchange Act
or other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, liabilities, expenses or damages
arise out of or are based, directly or indirectly, on (x) any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement or the Prospectus or any amendment or supplement to the Registration
Statement or the Prospectus or in any free writing prospectus approved by the
Company in accordance with Section 7(v) hereof,
or in any application or other document executed by or on behalf of the Company
or the Operating Partnership or based on written information furnished by or on
behalf of the Company or the Operating Partnership filed in any jurisdiction in
order to qualify the Shares under the securities laws thereof or filed with the
Commission, (y) the omission or alleged omission to state in any such document a
material fact required to be stated in it or necessary to make the statements in
it not misleading or (z) any breach by any of the indemnifying parties of any of
their respective representations, warranties and agreements contained in this
Agreement; provided,
however, that this
indemnity agreement shall not apply to the extent that such loss, claim,
liability, expense or damage arises from the sale of the Placement Shares
pursuant to this Agreement and is caused directly or indirectly by an untrue
statement or omission made in reliance upon and in conformity with written
information relating to CF&Co and furnished to the Company by CF&Co
expressly for inclusion in any document as described in clause (x) of this Section 9(a). This
indemnity agreement will be in addition to any liability that the Company or the
Operating Partnership might otherwise have.
(b) CF&Co
Indemnification. CF&Co agrees to indemnify and hold harmless the
Company, its directors, each officer of the Company that signed the Registration
Statement, the Operating Partnership and each person, if any, who
(i) controls the Company or the Operating Partnership within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act or (ii) is
controlled by or is under common control with the Company or the Operating
Partnership (a “Company
Affiliate”) against any and all loss, liability, claim, damage and
expense described in the indemnity contained in Section 9(a), as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendments thereto) or the Prospectus (or any amendment or supplement thereto)
in reliance upon and in conformity with written information relating to
CF&Co and furnished to the Company by CF&Co expressly for inclusion in
any document as described in clause (x) of Section 9(a) or with
respect to statements or omissions, or alleged untrue statements or omissions,
made in any free writing prospectus used by CF&Co and not previously
approved by the Company in accordance with Section 7(v)
hereof.
(c) Procedure. Any
party that proposes to assert the right to be indemnified under this Section 9 will,
promptly after receipt of notice of commencement of any action against such
party in respect of which a claim is to be made against an indemnifying party or
parties under this Section 9, notify
each such indemnifying party of the commencement of such action, enclosing a
copy of all papers served, but the omission so to notify such indemnifying party
will not relieve the indemnifying party from (i) any liability that it might
have to any indemnified party otherwise than under this Section 9 and (ii)
any liability that it may have to any indemnified party under the foregoing
provision of this Section 9 unless, and
only to the extent that, such omission results in the forfeiture of substantive
rights or defenses by the indemnifying party. If any such action is brought
against any indemnified party and it notifies the indemnifying party of its
commencement, the indemnifying party will be entitled to participate in and, to
the extent that it elects by delivering written notice to the indemnified party
promptly after receiving notice of the commencement of the action from the
indemnified party, jointly with any other indemnifying party similarly notified,
to assume the defense of the action, with counsel reasonably satisfactory to the
indemnified party, and after notice from the indemnifying party to the
indemnified party of its election to assume the defense, the indemnifying party
will not be liable to the indemnified party for any legal or other expenses
except as provided below and except for the reasonable costs of investigation
subsequently incurred by the indemnified party in connection with the defense.
The indemnified party will have the right to employ its own counsel in any such
action, but the fees, expenses and other charges of such counsel will be at the
expense of such indemnified party unless (i) the employment of counsel by the
indemnified party has been authorized in writing by the indemnifying party, (ii)
the indemnified party has reasonably concluded (based on advice of counsel) that
there may be legal defenses available to it or other indemnified parties that
are different from or in addition to those available to the indemnifying party,
(iii) a conflict or potential conflict exists (based on advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (iv) the indemnifying
party has not in fact employed counsel to assume the defense of such action
within a reasonable time after receiving notice of the commencement of the
action, in each of which cases the reasonable fees, disbursements and other
charges of counsel will be at the expense of the indemnifying party or parties.
It is understood that the indemnifying party or parties shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable
for the reasonable fees, disbursements and other charges of more than one
separate firm admitted to practice in such jurisdiction at any one time for all
such indemnified party or parties. All such fees, disbursements and other
charges will be reimbursed by the indemnifying party promptly as they are
incurred. An indemnifying party will not, in any event, be liable for any
settlement of any action or claim effected without its written
consent. No indemnifying party shall, without the prior written
consent of each indemnified party, settle or compromise or consent to the entry
of any judgment in any pending or threatened claim, action or proceeding
relating to the matters contemplated by this Section 9 (whether or
not any indemnified party is a party thereto), unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising or that may arise out of such claim, action or
proceeding.
(d) Contribution. In
order to provide for just and equitable contribution in circumstances in which
the indemnification provided for in the foregoing paragraphs of this Section 9 is
applicable in accordance with its terms but for any reason is held to be
unavailable from the Company, the Operating Partnership or CF&Co, the
Company and CF&Co will contribute to the total losses, claims, liabilities,
expenses and damages (including any investigative, legal and other expenses
reasonably incurred in connection with, and any amount paid in settlement of,
any action, suit or proceeding or any claim asserted, but after deducting any
contribution received by the Company or the Operating Partnership from persons
other than CF&Co, such as persons who control the Company or the Operating
Partnership within the meaning of the Securities Act, officers of the Company
who signed the Registration Statement and directors of the Company, who also may
be liable for contribution) to which the Company, the Operating Partnership and
CF&Co may be subject in such proportion as shall be appropriate to reflect
the relative benefits received by the Company and the Operating Partnership, on
the one hand, and CF&Co, on the other. The relative benefits received by the
Company and the Operating Partnership on the one hand and CF&Co on the other
hand shall be deemed to be in the same proportion as the total net proceeds from
the sale of the Placement Shares (before deducting expenses) received by the
Company bear to the total compensation received by CF&Co from the sale of
Placement Shares on behalf of the Company. If, but only if, the
allocation provided by the foregoing sentence is not permitted by applicable
law, the allocation of contribution shall be made in such proportion as is
appropriate to reflect not only the relative benefits referred to in the
foregoing sentence but also the relative fault of the Company and the Operating
Partnership, on the one hand, and CF&Co, on the other, with respect to the
statements or omission that resulted in such loss, claim, liability, expense or
damage, or action in respect thereof, as well as any other relevant equitable
considerations with respect to such offering. Such relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or the Operating
Partnership, on the one hand, or CF&Co, on the other, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the Operating
Partnership and CF&Co agree that it would not be just and equitable if
contributions pursuant to this Section 9(d) were to
be determined by pro rata allocation or by any other method of allocation that
does not take into account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of the loss, claim,
liability, expense, or damage, or action in respect thereof, referred to above
in this Section
9(d) shall be deemed to include, for the purpose of this Section 9(d), any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim to the
extent consistent with Section 9(c)
hereof. Notwithstanding the foregoing provisions of this Section 9(d),
CF&Co shall not be required to contribute any amount in excess of the
commissions received by it under this Agreement and no person found guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section 9(d), any
person who controls a party to this Agreement within the meaning of the
Securities Act, and any officers, directors, partners, employees or agents of
CF&Co, will have the same rights to contribution as that party, and each
officer of the Company who signed the Registration Statement will have the same
rights to contribution as the Company, subject in each case to the provisions
hereof. Any party entitled to contribution, promptly after receipt of notice of
commencement of any action against such party in respect of which a claim for
contribution may be made under this Section 9(d), will
notify any such party or parties from whom contribution may be sought, but the
omission to so notify will not relieve that party or parties from whom
contribution may be sought from any other obligation it or they may have under
this Section
9(d) except to the extent that the failure to so notify such other party
materially prejudiced the substantive rights or defenses of the party from whom
contribution is sought. Except for a settlement entered into pursuant to the
last sentence of Section 9(c) hereof,
no party will be liable for contribution with respect to any action or claim
settled without its written consent if such consent is required pursuant to
Section 9(c)
hereof.
10. Representations and
Agreements to Survive Delivery. The indemnity and contribution
agreements contained in Section 9 of this
Agreement and all representations and warranties of the Company and the
Operating Partnership herein or in certificates delivered pursuant hereto shall
survive, as of their respective dates, regardless of (i) any investigation made
by or on behalf of CF&Co, any controlling persons, or the Company or the
Operating Partnership (or any of their respective officers, directors or
controlling persons), (ii) delivery and acceptance of the Placement Shares and
payment therefor or (iii) any termination of this Agreement.
11. Termination.
(a) CF&Co shall have the right by
giving notice as hereinafter specified at any time to terminate this Agreement
if (i) any Material Adverse Effect, or any development that could reasonably be
expected to cause a Material Adverse Effect has occurred, that, in the
reasonable judgment of CF&Co, may materially impair the ability of CF&Co
to sell the Placement Shares hereunder; (ii) the Company or the Operating
Partnership shall have failed, refused or been unable to perform any agreement
on its part to be performed hereunder; provided, however, in the
case of any failure of the Company to deliver (or cause another person to
deliver) any certification, opinion, or letter required under Sections 7(n), 7(o), or 7(p), CF&Co’s
right to terminate shall not arise unless such failure to deliver (or cause to
be delivered) continues for more than thirty (30) days from the date such
delivery was required; or (iii) any other condition of CF&Co’s
obligations hereunder is not fulfilled; or (iv), any suspension or limitation of
trading in the Placement Shares or in securities generally on the Exchange shall
have occurred. Any such termination shall be without liability of any
party to any other party except that the provisions of Section 7(h)
(Expenses), Section
9 (Indemnification), Section 10 (Survival
of Representations), Section 16
(Applicable Law; Consent to Jurisdiction) and Section 17 (Waiver of
Jury Trial) hereof shall remain in full force and effect notwithstanding such
termination.
(b) The Company and the Operating
Partnership shall have the right, by giving ten (10) days notice as hereinafter
specified to terminate this Agreement in their sole discretion at any time after the date of this
Agreement. Any such termination shall be without liability of
any party to any other party except that the provisions of Section 7(h), Section 9, Section 10, Section 16 and Section 17 hereof
shall remain in full force and effect notwithstanding such
termination.
(c) CF&Co shall have the right, by
giving ten (10) days notice as hereinafter specified to terminate this Agreement
in its sole discretion at any time after the
date of this Agreement. Any such termination shall be without
liability of any party to any other party except that the provisions of Section 7(h), Section 9, Section 10, Section 16 and Section 17 hereof
shall remain in full force and effect notwithstanding such
termination.
(d) Unless earlier terminated pursuant to
this Section
11, this Agreement shall automatically terminate upon the issuance and
sale of all of the Placement Shares through CF&Co on the terms and subject
to the conditions set forth herein; provided that the provisions
of Section
7(h), Section
9, Section
10, Section
16 and Section
17 hereof shall remain in full force and effect notwithstanding such
termination.
(e) This Agreement shall remain in full
force and effect unless terminated pursuant to Sections 11(a), (b), (c), or (d) above or
otherwise by mutual agreement of the parties; provided, however, that any
such termination by mutual agreement shall in all cases be deemed to provide
that Section
7(h), Section
9, Section
10, Section
16 and Section
17 shall remain in full force and effect.
(f) Any termination of this Agreement shall
be effective on the date specified in such notice of termination; provided, however, that such
termination shall not be effective until the close of business on the date of
receipt of such notice by CF&Co or the Company, as the case may be. If such
termination shall occur prior to the Settlement Date for any sale of Placement
Shares, such Placement Shares shall settle in accordance with the provisions of
this Agreement.
12. Notices. All
notices or other communications required or permitted to be given by any party
to any other party pursuant to the terms of this Agreement shall be in writing,
unless otherwise specified in this Agreement, and if sent to CF&Co, shall be
delivered to CF&Co at Cantor ▇▇▇▇▇▇▇▇▇▇ & Co., ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, fax no. (▇▇▇) ▇▇▇-▇▇▇▇, Attention: Capital Markets/▇▇▇▇
▇▇▇▇▇, with copies to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, General Counsel, at the same address, and
DLA Piper US LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, fax no. (▇▇▇)
▇▇▇-▇▇▇▇, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇; or if sent to the Company or the Operating
Partnership, shall be delivered to Mid-America Apartment Communities, Inc., ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, fax no. (▇▇▇) ▇▇▇-▇▇▇▇, Attention:
Simon ▇. ▇. ▇▇▇▇▇▇▇▇▇, with a copy to ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇ PC, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, fax no. (▇▇▇) ▇▇▇-▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇. Each party to this Agreement may change such
address for notices by sending to the parties to this Agreement written notice
of a new address for such purpose. Each such notice or other
communication shall be deemed given (i) when delivered personally or by
verifiable facsimile transmission (with an original to follow) on or before 4:30
p.m., New York City time, on a Business Day or, if such day is not a Business
Day, on the next succeeding Business Day, (ii) on the next Business Day after
timely delivery to a nationally-recognized overnight courier and (iii) on the
Business Day
actually received if deposited in the U.S. mail (certified or registered mail,
return receipt requested, postage prepaid). For purposes of this Agreement,
“Business
Day” shall mean any day on which the Exchange and commercial banks in the
City of New York are open for business.
13. Successors and
Assigns. This Agreement shall inure to the benefit of and be
binding upon the Company, the Operating Partnership and CF&Co and their
respective successors and the affiliates, controlling persons, officers and
directors referred to in Section 9 hereof.
References to any of the parties contained in this Agreement shall be deemed to
include the successors and permitted assigns of such party. Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and permitted assigns any
rights, remedies, obligations or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement. Neither party may
assign its rights or obligations under this Agreement without the prior written
consent of the other party; provided, however, that CF&Co may
assign its rights and obligations hereunder to an affiliate of CF&Co without
obtaining the Company’s consent.
14. Adjustments for Stock
Splits. The parties acknowledge and agree that all
stock-related numbers contained in this Agreement shall be adjusted to take into
account any stock split, stock dividend or similar event effected with respect
to the Shares.
15. Entire Agreement; Amendment;
Severability. This Agreement (including all schedules and
exhibits attached hereto and Placement Notices issued pursuant hereto)
constitutes the entire agreement and supersedes all other prior and
contemporaneous agreements and undertakings, both written and oral, among the
parties hereto with regard to the subject matter hereof. Neither this Agreement
nor any term hereof may be amended except pursuant to a written instrument
executed by the Company and CF&Co. In the event that any one or
more of the provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable as written by a court of
competent jurisdiction, then such provision shall be given full force and effect
to the fullest possible extent that it is valid, legal and enforceable, and the
remainder of the terms and provisions herein shall be construed as if such
invalid, illegal or unenforceable term or provision was not contained herein,
but only to the extent that giving effect to such provision and the remainder of
the terms and provisions hereof shall be in accordance with the intent of the
parties as reflected in this Agreement.
16. Applicable Law; Consent to
Jurisdiction. This Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of New York without regard to
the principles of conflicts of laws. Each party hereby irrevocably submits to
the non-exclusive jurisdiction of the state and federal courts sitting in the
City of New York, borough of Manhattan, for the adjudication of any dispute
hereunder or in connection with any transaction contemplated hereby, and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such
court, that such suit, action or proceeding is brought in an inconvenient forum
or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of
process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof (certified or registered mail, return
receipt requested) to such party at the address in effect for notices to it
under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve process in any
manner permitted by law.
17. Waiver of Jury
Trial. The Company, the Operating Partnership and CF&Co
each hereby irrevocably waives any right it may have to a trial by jury in
respect of any claim based upon or arising out of this Agreement or any
transaction contemplated hereby.
18. Absence of Fiduciary
Relationship. The Company and
the Operating Partnership jointly and severally acknowledge and agree
that:
(a) CF&Co
has been retained solely to act as underwriter in connection with the sale of
the Shares that no fiduciary, advisory or agency relationship between the
Company and CF&Co has been created in respect of any of the transactions
contemplated by this Agreement, irrespective of whether CF&Co has advised or
is advising the Company on other matters;
(b) each of
the Company and the Operating Partnership is capable of evaluating and
understanding and understand and accept the terms, risks and conditions of the
transactions contemplated by this Agreement;
(c) each of
the Company and the Operating Partnership has been advised that CF&Co and
its affiliates are engaged in a broad range of transactions which may involve
interests that differ from those of the Company or the Operating Partnership and
that CF&Co has no obligation to disclose such interests and transactions to
the Company or the Operating Partnership by virtue of any fiduciary, advisory or
agency relationship; and
(d) each of
the Company and the Operating Partnership waives, to the fullest extent
permitted by law, any claims it may have against CF&Co, for breach of
fiduciary duty or alleged breach of fiduciary duty and agrees that CF&Co
shall have no liability (whether direct or indirect) to the Company or the
Operating Partnership in respect of such a fiduciary claim or to any person
asserting a fiduciary duty claim on behalf of or in right of the Company or the
Operating Partnership, including stockholders, partners, employees or creditors
of the Company or the Operating Partnership.
19. Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument. Delivery of an executed Agreement by one party to the other may be
made by facsimile transmission.
20. Definitions. As
used in this Agreement, the following terms have the respective meanings set
forth below:
(a) “Applicable
Time” means the time of each sale of any Shares or any securities
pursuant to this Agreement.
(b) “GAAP”
means United States generally accepted accounting principles.
(c) “Organizational
Documents” means (a) in the case of a corporation, its charter and
by-laws; (b) in the case of a limited or general partnership, its
partnership certificate, certificate of formation or similar organizational
document and its partnership agreement; (c) in the case of a limited
liability company, its articles of organization, certificate of formation or
similar organizational documents and its operating agreement, limited liability
company agreement, membership agreement or other similar agreement; (d) in
the case of a trust, its certificate of trust, certificate of formation or
similar organizational document and its trust agreement or other similar
agreement; and (e) in the case of any other entity, the organizational and
governing documents of such entity.
[Remainder
of Page Intentionally Blank]
If the
foregoing correctly sets forth the understanding among the Company, the
Operating Partnership and CF&Co, please so indicate in the space provided
below for that purpose, whereupon this letter shall constitute a binding
agreement between the Company, the Operating Partnership and
CF&Co.
Very
truly yours,
MID-AMERICA
APARTMENT COMMUNITIES, INC.
By: /s/▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
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|
Title: Vice
President, Director of External Reporting and Corporate
Secretary
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MID-AMERICA
APARTMENTS, L.P.
By: Mid-America
Apartment Communities, Inc.
its sole general partner
By: /s/▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
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Title: Vice
President, Director of External Reporting and Corporate
Secretary
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ACCEPTED
as of the date first-above written:
CANTOR
▇▇▇▇▇▇▇▇▇▇ & CO.
By: /s/▇▇▇▇▇▇▇
▇▇▇▇▇
Name:
▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Managing
Director
SCHEDULE
1
FORM OF PLACEMENT
NOTICE
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From:
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[
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]
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Cc:
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[
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]
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To:
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[
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]
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Subject: Controlled
Equity Offering—Placement Notice
Gentlemen:
Pursuant
to the terms and subject to the conditions contained in the Controlled Equity
OfferingSM
Sales Agreement between Mid-America Apartment Communities, Inc. (the “Company”),
Mid-America Apartments, L.P. and Cantor ▇▇▇▇▇▇▇▇▇▇ & Co. (“CF&Co”) dated
November 5, 2009 (the “Agreement”), I hereby
request on behalf of the Company that CF&Co sell up to [ ] shares of the
Company’s common stock, par value $0.01 per share, at a minimum market price of
$_______ per share.
SCHEDULE
2
CANTOR ▇▇▇▇▇▇▇▇▇▇ &
CO.
▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
MID-AMERICA APARTMENT
COMMUNITIES, INC.
▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇,
III ▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇
H. ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇.▇▇▇
Leslie
Wolfgang ▇▇▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇
SCHEDULE
3
Compensation
CF&Co
shall be paid compensation that will not exceed two percent (2%) on all gross
proceeds from the sales of the Shares pursuant to this Agreement.
Schedule
3
Free
Writing Prospectus
Exhibit
7(n)
OFFICER
CERTIFICATE
The
undersigned, the duly qualified and elected _______________________, of MID-AMERICA APARTMENT COMMUNITIES,
INC. (“Company”),
a Tennessee corporation, does hereby certify in such capacity and on behalf of
the Company, pursuant to Section 7(m) of the
Sales Agreement dated November 5, 2009 (the “Sales
Agreement”) between the Company, Mid-America Apartments, L.P.
(“Operating
Partnership”) and
Cantor ▇▇▇▇▇▇▇▇▇▇ & Co., that to the best of the knowledge of the
undersigned.
(i) The
representations and warranties of the Company and the Operating Partnership in
Section 6 of
the Sales Agreement (A) to the extent such representations and warranties are
subject to qualifications and exceptions contained therein relating to
materiality or Material Adverse Effect, are true and correct on and as of the
date hereof with the same force and effect as if expressly made on and as of the
date hereof, except for those representations and warranties that speak solely
as of a specific date and which were true and correct as of such date, and (B)
to the extent such representations and warranties are not subject to any
qualifications or exceptions, are true and correct in all material respects as
of the date hereof as if made on and as of the date hereof with the same force
and effect as if expressly made on and as of the date hereof except for those
representations and warranties that speak solely as of a specific date and which
were true and correct as of such date; and
(ii) The
Company and the Operating Partnership have complied with all agreements and
satisfied all conditions on their part to be performed or satisfied pursuant to
the Sales Agreement at or prior to the date hereof.
By: _________________________________________________
Name:
Title:
Date:_______________________
Exhibit
7(o)(1)(a)
MATTERS
TO BE COVERED BY INITIAL OPINION
OF
▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ PC
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(i)
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The
authorized capital stock of the Company conforms as to legal matters to
the description thereof contained in the Prospectus and meets the
requirements of Item 9 of Form S-3 under the Securities
Act.
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(ii)
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The
Company is a corporation duly incorporated and existing under and by
virtue of the laws of the State of Tennessee and is in good standing with
the Tennessee Secretary of State. The Company has the corporate
power to own, lease and operate its properties and conduct its business in
all material respects as described under the headings “Item 1 Business”
and “Item 2 Properties” in the Company’s Annual Report on Form 10-K for
the year ended December 31, 2008
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(iii)
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The
Company is duly qualified or registered to transact business in each
jurisdiction set forth on Schedule 1 hereto. To the knowledge
of such counsel, other than the Company’s interests in its subsidiaries
disclosed in Exhibit 21 to the Company’s Annual Report on Form 10-K for
the year ended December 31, 2008 or as disclosed in the Prospectus, the
Company does not own, directly or indirectly, any capital stock or other
equity securities of any corporation or any ownership interest in any
limited liability company, partnership, joint venture or other
association.
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(iv)
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The
Operating Partnership is a limited partnership duly formed and existing
under and by virtue of the laws of the State of Tennessee and is in good
standing with the Tennessee Secretary of State. The Operating
Partnership has the limited partnership power to own, lease and operate
its properties and conduct its business in all material respects as
described under the headings “Item 1 Business” and “Item 2 Properties” in
the Company’s Annual Report on Form 10-K for the year ended December 31,
2008. The Operating Partnership is duly qualified or registered
to transact business in each jurisdiction set forth on Schedule 1
hereto.
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(v)
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The
execution, delivery and performance of this Agreement by the Company and
the Operating Partnership and the consummation of the transactions
contemplated hereby do not conflict with, or result in any breach of, or
constitute a default under (nor constitute an event that with notice,
lapse of time or both would constitute a breach of or default under), (i)
any Organizational Document of the Company or any of its subsidiaries,
(ii) any material contract or agreement filed as an exhibit to the
Company’s Annual Report on Form 10-K for the year ended December 31, 2008
(each, a “Material Contract”); provided, however, that such counsel need
express no opinion (a) as to whether the execution, delivery or
performance of any contract, instrument or agreement will constitute a
violation of, or a default under, any covenant, restriction or provision
with respect to financial ratios or tests or any aspect of the financial
condition or results of operations of any person or entity or (b) with
respect to any matter which requires mathematical calculation or any
financial or accounting determination or (iii) to such counsel’s
knowledge, any law, decree, judgment or order applicable to the Company
(other than state and foreign securities or blue sky laws, as to which
such counsel need express no opinion), except in the case of clauses (ii)
and (iii) for such conflicts, breaches or defaults, which individually or
in the aggregate could not be reasonably expected to have a Material
Adverse Effect.
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(vi)
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Each
of the Company and the Operating Partnership has the corporate or limited
partnership power, as applicable, to execute and deliver this Agreement
and, in the case of the Company, to issue, sell and deliver the Shares as
contemplated in this Agreement. This Agreement has been duly
authorized, executed and, so far as is known to such counsel, delivered by
the Company and the Operating
Partnership.
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(vii)
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No
approval, authorization, consent or order of, or filing with, any federal
or state governmental or regulatory commission, board, body, authority or
agency is required under applicable law in connection with the execution,
delivery and performance of this Agreement, or the consummation of the
transactions contemplated hereby, by the Company or the Operating
Partnership, other than such as have been obtained or made under the
Securities Act or the Exchange Act and such approvals as have been
obtained, subject to official notice of issuance, in connection with the
listing of the Placement Shares on the Exchange, except such as may be
required by the securities or Blue Sky laws of the various states or by
FINRA, in connection with the offer and sale of the Placement Shares, as
to which we express no opinion.
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(viii)
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The
Shares, when issued and delivered by the Company pursuant to this
Agreement against payment of the consideration set forth therein, will be
duly authorized, validly issued, fully paid and
nonassessable.
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(ix)
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The
issuance and sale of the Placement Shares by the Company is not subject to
preemptive or other similar rights arising by operation of Tennessee law
under the Organizational Documents of the Company or any of its
subsidiaries or under any Material
Contract.
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(x)
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To
such counsel’s knowledge, except as otherwise described in the Prospectus,
there are no persons with registration or other similar rights to have any
securities registered pursuant to the Registration
Statement.
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(xi)
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At
the time the Registration Statement became effective (including each
deemed effective date with respect to CF&Co pursuant to Rule
430B(f)(2)), the Registration Statement and, as of its date and the date
of such opinion, the Prospectus (in each case, other than the financial
statements, financial schedules and other financial and statistical data
included or incorporated by reference in, or excluded from, the
Registration Statement and the Prospectus, as to which such counsel need
express no opinion) complied as to form in all material respects with the
requirements of the Securities Act.
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(xii)
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Each
document incorporated by reference in the Registration Statement or the
Prospectus (in each case, other than the financial statements, financial
schedules and other financial and statistical data included or
incorporated by reference in, or excluded from, such document, as to which
such counsel need express no opinion), when it was filed with the
Commission, complied as to form in all material respects to the
requirements of the Securities Act or the Exchange Act, as
applicable.
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(xiii)
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The
statements under the caption “Description of Stock” in the Prospectus,
insofar as such statements constitute a summary of the legal matters
referred to therein, constitute accurate summaries thereof in all material
respects as of the date of such
statements.
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(xiv)
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To
such counsel’s knowledge, there are no actions, suits or proceedings or
inquiries or investigations, pending or threatened, against the Company or
to which the Company’s assets (excluding the Company’s direct or indirect
interests in its subsidiaries) are subject, at law or in equity, before or
by any federal, state, local or foreign governmental or regulatory
commission, board, body, authority, arbitration panel or agency that are
required to be described in the Prospectus or the documents incorporated
therein by reference but are not so
described.
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(xv)
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The
Company is not an “investment company” required to register under the
Investment Company Act of 1940, as amended, (the “1940 Act”) or a company
“controlled” by an “investment company” within the meaning of the 1940
Act.
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(xvi)
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The
Shares to be issued and sold by the Company pursuant to the Sales
Agreement, are duly listed, and admitted and authorized for trading,
subject to official notice of issuance, on the
Exchange.
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(xvii)
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Commencing
with its taxable year ended December 31, 1994, the Company has been
organized and has operated in conformity with the requirements for
qualification and taxation as a REIT under the Code and its organization
and proposed method of operation will enable it to continue to meet the
requirements for qualification and taxation as a
REIT.
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(xviii)
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The
Registration Statement has been declared effective by the Commission under
the Securities Act. To the knowledge of such counsel, (a) no
stop order suspending the effectiveness of the Registration Statement has
been issued under the Securities Act and (b) no proceedings for such
purpose have been instituted or are pending or are contemplated or
threatened by the Commission. Any required filing of the
Prospectus and any supplement thereto pursuant to Rule 424(b) under the
Securities Act has been made in the manner and within the time period
required by such Rule 424(b).
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(xix)
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The
statements contained in the Prospectus under the caption “Certain Material
U.S. Federal Income Tax Considerations” insofar as such statements
constitute matters of law, summaries of legal matters, or legal
conclusions, have been reviewed by such counsel and fairly present and
summarize, in all material respects, the matters referred to
therein.
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In
addition, such opinion shall also contain a statement that such counsel has
participated in conferences with officers and other representatives of the
Company and representatives of the independent accountants at which the contents
of the Registration Statement* and the Prospectus* and related matters were
discussed, and although it does not pass upon, or assume any responsibility for,
the accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus and has made no independent check or
verification thereof (except to the extent referred to in paragraphs (xiii) and
(xix) of its opinion to the CF&Co dated the date hereof), on the basis of
the foregoing, no facts have come to such counsel’s attention that have caused
it to believe that the Registration Statement, at its effective date, including
each deemed effective date with respect to CF&Co pursuant to Rule
430B(f)(2), contained an untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus, as of its date or as
of the date of such opinion, contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading (except that in each case such counsel may state that it
does not express any view as to the financial statements, schedules and other
financial or statistical information derived from such financial statements or
schedules included or incorporated by reference therein).
* Note:
“Registration Statement” and “Prospectus” are defined to include documents
incorporated by reference therein.
Exhibit
7(o)(1)(b)
Matters to be covered by
subsequent Company Counsel Opinions
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(i)
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The
Registration Statement has been declared effective by the Commission under
the Securities Act. To the knowledge of such counsel, (a) no
stop order suspending the effectiveness of the Registration Statement has
been issued under the Securities Act and (b) no proceedings for such
purpose have been instituted or are pending or are contemplated or
threatened by the Commission.
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(ii)
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At
the time the Registration Statement became effective (including at each
deemed effective date with respect to CF&Co pursuant to Rule
430B(f)(2)), the Registration Statement and, as of the date of the most
recent Prospectus Supplement, the Prospectus (in each case, other than the
financial statements, financial schedules and other financial and
statistical data included or incorporated by reference in, or excluded
from, the Registration Statement and the Prospectus, as to which such
counsel need express no opinion) complied as to form in all material
respects with the requirements of the Securities
Act.
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(iii)
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Each
document incorporated by reference in the Registration Statement or the
Prospectus (in each case, other than the financial statements, financial
schedules and other financial and statistical data included or
incorporated by reference in, or excluded from, such document, as to which
such counsel need express no opinion), when it was filed with the
Commission, complied as to form in all material respects to the
requirements of the Securities Act or the Exchange Act, as
applicable.
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(iv)
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Commencing
with its taxable year ended December 31, 1994, the Company has been
organized and has operated in conformity with the requirements for
qualification and taxation as a REIT under the Code and its organization
and proposed method of operation will enable it to continue to meet the
requirements for qualification and taxation as a
REIT.
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In
addition, such opinion shall also contain a statement that such counsel has
participated in conferences with officers and other representatives of the
Company and representatives of the independent accountants at which the contents
of the Registration Statement* and the Prospectus* and related matters were
discussed, and although it does not pass upon, or assume any responsibility for,
the accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus and has made no independent check or
verification thereof, on the basis of the foregoing, no facts have come to such
counsel’s attention that have caused it to believe that the Registration
Statement, at its effective date, including each deemed effective date with
respect to CF&Co pursuant to Rule 430B(f)(2), contained an untrue statement
of a material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not misleading or that the
Prospectus, as of its date, as of each Applicable Time and as of the date of
such opinion, contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading (except that in each case such counsel may state that it does not
express any view as to the financial statements, schedules and other financial
or statistical information derived from such financial statements or schedules
included or incorporated by reference therein).
* Note:
“Registration Statement” and “Prospectus” will be defined to include documents
incorporated by reference therein.