EXHIBIT 1.1
1,000,000 SHARES
CORPORATE OFFICE PROPERTIES TRUST
10 1/4% SERIES E CUMULATIVE REDEEMABLE PREFERRED SHARES OF BENEFICIAL INTEREST
(LIQUIDATION PREFERENCE $25.00 PER SHARE)
UNDERWRITING AGREEMENT
MARCH 30, 2001
CREDIT SUISSE FIRST BOSTON CORPORATION
A.G. EDWARDS & SONS, INC.
As Representatives of the Several Underwriters (the "Representatives"),
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. INTRODUCTORY. Corporate Office Properties Trust, a Maryland real estate
investment trust ("COMPANY"), proposes to issue and sell 1,000,000 ("FIRM
SECURITIES") of its 10.25% Series E Cumulative Redeemable Preferred Shares of
Beneficial Interest (Liquidation Preference $25.00 Per Share), par value $.01
per share ("SECURITIES"), and also proposes to issue and sell to the
Underwriters, at the option of the Underwriters, an aggregate of not more than
150,000 additional shares ("OPTIONAL SECURITIES") of its Securities as set forth
below. The Firm Securities and the Optional Securities are herein collectively
called the "OFFERED SECURITIES." The Company and Corporate Office Properties,
L.P., a Delaware limited partnership ("OPERATING PARTNERSHIP"), hereby agree
with the several Underwriters named in Schedule I hereto ("UNDERWRITERS") as
follows:
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE OPERATING
PARTNERSHIP. The Company and the Operating Partnership represent and warrant to,
and agree with, the several Underwriters that:
(a) A registration statement (No. 333-71807) relating to the Offered
Securities, including a form of prospectus, has been filed with the
Securities and Exchange Commission (the "COMMISSION") under the Securities
Act of 1933, as amended ("ACT") and such registration statement ("INITIAL
REGISTRATION STATEMENT") has been declared effective. A post-effective
amendment to the initial registration statement has also been filed and
declared effective under the Act. For purposes of this Agreement,
"EFFECTIVE TIME" with respect to the initial registration statement means
the date and time as of which the most recent post-effective amendment
thereto filed prior to the execution and delivery of this Agreement, was
declared effective by the Commission. "EFFECTIVE DATE" with respect to the
initial registration statement means the date of the
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Effective Time thereof. The initial registration statement, as amended at
its Effective Time, including all material incorporated by reference
therein, pursuant to the General Instructions of the Form on which it is
filed and including all information (if any) deemed to be a part of the
initial registration statement as of its Effective Time pursuant to Rule
430A(b) ("RULE 430A(B)") under the Act, is hereinafter referred to as the
"REGISTRATION STATEMENT." The form of prospectus relating to the Offered
Securities, as first filed with the Commission pursuant to and in
accordance with Rule 424(b) ("RULE 424(B)") under the Act or (if no such
filing is required) as included in a Registration Statement, including all
material incorporated by reference in such prospectus, is hereinafter
referred to as the "PROSPECTUS." No document has been or will be prepared
or distributed in reliance on Rule 434 under the Act. The Company meets the
requirements for the use of Form S-3 under the Act and the Registration
Statement meets the requirements of, and complies in all material respects
with, Rule 415(a)(1)(x) under the Act.
(b) If the Effective Time of the Registration Statement is prior to
the execution and delivery of this Agreement: (i) on the Effective Date of
the Registration Statement, the Registration Statement conformed in all
respects to the requirements of the Act and the rules and regulations of
the Commission ("RULES AND REGULATIONS") and did not include any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein not
misleading and (ii) on the date of this Agreement, the Registration
Statement conforms, and at the time of filing of the Prospectus pursuant to
Rule 424(b) the Registration Statement and the Prospectus will conform, in
all respects, to the requirements of the Act and the Rules and Regulations,
and neither of such documents includes, or will include, any untrue
statement of a material fact or omits, or will omit, to state any material
fact required to be stated therein or necessary to make the statements
therein not misleading, and with respect to the Prospectus only, in light
of the circumstances in which they were made. The preceding sentence does
not apply to statements in or omissions from a Registration Statement or
the Prospectus based upon written information furnished to the Company by
any Underwriter through the Representatives specifically for use therein,
it being understood and agreed that the only such information is that
described as such in Section 7(b) hereof.
(c) No stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued and, to the knowledge of the
Company, no proceeding for that purpose has been instituted or threatened
by the Commission or by the state securities authority of any jurisdiction.
No order preventing or suspending the use of the Prospectus has been issued
and, to the knowledge of the Company, no proceeding for that purpose has
been instituted or threatened by the Commission or by the state securities
authority of any jurisdiction.
(d) The Company has been duly organized and is an existing real estate
investment trust in good standing under the laws of the State of Maryland,
with power and authority as a real estate investment trust to own its
properties and conduct its business as described in the Prospectus; and the
Company is duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions in which its ownership or lease of
property or the conduct of its business requires such qualification, except
where the failure to be so qualified would not reasonably be expected to
have a material
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adverse effect on (i) the condition (financial or other), business,
properties, prospects, net worth or results of operations of the Company
and its Subsidiaries (as hereinafter defined) taken as a whole, (ii) the
issuance, validity or enforceability of the Offered Securities or (iii) the
consummation of any of the transactions contemplated by this Agreement to
be performed by the Company and/or the Subsidiaries (individually or
collectively, a "MATERIAL ADVERSE EFFECT").
(e) Each subsidiary of the Company listed on Schedule II hereto
("SUBSIDIARIES") has been duly organized and is validly existing as a
corporation, limited partnership or other legal entity, as the case may be,
in good standing under the laws of its respective jurisdictions of
incorporation or formation, with power and authority (corporate and other)
to own its properties and conduct its business as described in the
Prospectus; and each Subsidiary is duly qualified to do business as a
foreign corporation, limited partnership or other legal entity, as the case
may be, in good standing in all other jurisdictions in which such
Subsidiary's ownership or lease of property or the conduct of such
Subsidiary's business requires such qualification, except where the failure
to be so qualified would not reasonably be expected to have a Material
Adverse Effect. The issued and outstanding common and preferred units of
limited partnership interest in the Operating Partnership ("UNITS") and
other equity interests, as the case may be, of each of the Company's other
Subsidiaries have been duly authorized and validly issued, are, with
respect to corporate Subsidiaries, fully paid and nonassessable and, except
as otherwise set forth in the Prospectus or reflected in the financial
statements contained in, or incorporated by reference in, the Prospectus,
are owned beneficially by the Company, directly or indirectly through one
or more Subsidiaries, free and clear of any security interests, liens,
encumbrances, equities or claims, except for security interests, liens,
encumbrances, equities or claims pursuant to the terms of a bona fide
financing transaction.
(f) Complete and correct copies of the declaration of trust and of the
bylaws of the Company, the certificate of limited partnership and agreement
of limited partnership of the Operating Partnership and the charter
documents, partnership agreements and other organizational documents of the
other Subsidiaries, as applicable, and all amendments thereto as have been
requested by the Underwriters or their counsel have been delivered to the
Underwriters or their counsel. As of the Closing Date (as hereinafter
defined), the partnership agreement of the Operating Partnership, as
amended, will have been duly authorized, executed and delivered by the
Company, as the general partner and as a limited partner and (assuming it
has been duly authorized, executed and delivered by each of the other
parties thereto, and is a legal, valid and binding agreement of each such
other party) in full force and effect, subject to (i) the effect of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
or other similar laws now or hereafter in effect relating to or affecting
the rights and remedies of creditors, (ii) the effect of general principles
of equity, whether enforcement is considered in a proceeding in equity or
at law, and the discretion of the court before which any proceeding
therefore may be brought and (iii) the provisions of the Delaware Revised
Uniform Limited Partnership Act.
(g) The Company has an authorized, issued and outstanding
capitalization as set forth in the Prospectus. All of the issued and
outstanding shares of beneficial interest of the Company have been duly
authorized and validly issued and are fully paid and
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nonassessable. The Offered Securities have been duly authorized and, when
the Offered Securities have been delivered and paid for in accordance with
this Agreement on each Closing Date (as hereinafter defined), such Offered
Securities will have been validly issued, fully paid and nonassessable and
will conform to the description thereof contained in the Prospectus and the
description contained in the articles supplementary determining the terms
of the Offered Securities ("ARTICLES SUPPLEMENTARY"), and at the First
Closing Date (as hereinafter defined) and Optional Closing Date (as
hereinafter defined), such descriptions will be, complete and accurate in
all material respects; the stockholders of the Company have no preemptive
rights with respect to the Offered Securities; and no holder of securities
of the Company has any right which has not been fully exercised or waived
to require the Company to register the offer or sale of any securities
owned by such holder under the Act in the public offering contemplated by
this Agreement.
(h) Except as disclosed in the Prospectus or not disclosed because not
material, the Company and its Subsidiaries do not have outstanding, and at
the First Closing Date and Optional Closing Date will not have outstanding
(A) securities or obligations of the Company or any of its Subsidiaries
convertible into or exchangeable for any shares of beneficial interest of
the Company or any such Subsidiary, (B) warrants, rights or options to
subscribe for or purchase from the Company or any such Subsidiary any such
shares of beneficial interest or any such convertible or exchangeable
securities or obligations, or (C) obligations of the Company or any such
Subsidiary to issue any shares of beneficial interest, any such convertible
or exchangeable securities or obligations, or any such warrants, rights or
options. Upon payment of the purchase price and delivery of certificates
evidencing the Offered Securities in accordance herewith, the Underwriters
will receive good, valid and marketable title to the Offered Securities,
free and clear of all security interests, mortgages, pledges, liens,
encumbrances, claims and equities. The form of share certificates to be
used to evidence the Offered Securities will be in due and proper form and
will comply, in all material respects, with all applicable legal
requirements. Other than shares of beneficial interest of the Company
issuable upon (i) exercise of share options pursuant to the Company's
stock-based plans for its employees and trustees, (ii) upon the redemption
of Units, (iii) in connection with certain limited partnership interests in
limited partnerships holding certain office properties retained by Shidler
Equities, L.P. and Clay W. Hamlin, III, or (iv) in connection with the
conversion of either of the 5.5% Series A Convertible Preferred Shares of
Beneficial Interest, or the 4% Series D Convertible Preferred Shares of
Beneficial Interest of the Company into Common Shares of Beneficial
Interest of the Company, no shares of beneficial interest of the Company
are reserved for any purpose, except as disclosed in the Prospectus.
(i) Prior to the First Closing Date (as hereinafter defined), the
Offered Securities have been approved for listing on the New York Stock
Exchange ("NYSE") subject to notice of issuance.
(j) The execution, delivery and performance of this Agreement by the
Company and the Operating Partnership, the issuance, offering and sale of
the Offered Securities to the Underwriters by the Company pursuant to this
Agreement, the execution and recording of the Articles Supplementary by the
Company and the compliance by the Company and the Operating Partnership
with the other provisions of this Agreement and the consummation of the
other transactions herein contemplated do not (i) require any
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material governmental license, permit, consent, approval, authorization or
other order of, registration, filing or qualification with, any court or
governmental body or agency (except for the filing of the Articles
Supplementary with the State Department of Assessments and Taxation of
Maryland ("SDAT"), which filing with the SDAT will be made prior to the
First Closing Date, and except such as have been obtained or may be
required under the Act and the Securities Exchange Act of 1934, as amended
(the "EXCHANGE ACT"), securities, blue sky or real estate syndication laws
of the various states, the bylaws and rules of the National Association of
Securities Dealers, Inc. ("NASD") or the requirements of the NYSE), (ii)
result in the creation or imposition of any lien, charge or encumbrance
upon any of the assets or properties of the Company or any of the
Subsidiaries pursuant to the terms or provisions of, or conflict with or
constitute a breach or violation of any of the terms or provisions of, or a
default under (and there is no event which, but for the passage of time or
the giving of notice, or both, would constitute a default under any of the
foregoing), or give any other party a right to terminate any of its
obligations under, or result in the acceleration of any obligation under,
the charter, declaration of trust, bylaws, partnership agreement or other
organizational document of the Company or any of the Subsidiaries or in the
performance or observance of any obligation, covenant, agreement or
condition contained in any indenture, loan agreement, mortgage, bond,
debenture, note agreement, joint venture or partnership agreement, lease or
other agreement or instrument that is material to the Company and the
Subsidiaries, taken as a whole, to which the Company or any of the
Subsidiaries is a party or by which the Company or any of the Subsidiaries
or their respective property is bound or, (iii) violate or conflict with
any applicable law or any rule, regulation, judgment, order, statute,
administrative regulation or decree of any court or any governmental body
or agency (foreign or domestic) having jurisdiction over the Company, any
of the Subsidiaries or their respective property, in each case except for
liens, charges, encumbrances, breaches, violations, defaults, rights to
terminate or accelerate obligations, or conflicts, the imposition or
occurrence of which would not have a Material Adverse Effect.
(k) Each of the Company and the Operating Partnership has full trust
or partnership power, as the case may be, to enter into this Agreement, and
to carry out all of the terms and provisions hereof to be carried out by
them. This Agreement has been duly and validly authorized, executed and
delivered by each of the Company and the Operating Partnership, and
constitutes a valid and binding agreement of each of the Company and the
Operating Partnership, and assuming due authorization, execution and
delivery by the Underwriters, is enforceable against the Company and the
Operating Partnership, in accordance with the terms hereof subject to (i)
the effect of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to or affecting the rights and remedies of creditors and (ii) the
effect of general principles of equity, whether enforcement is considered
in a proceeding in equity or at law, and the discretion of the court before
which any proceeding therefor may be brought. The Articles Supplementary
have been duly and validly authorized, executed and delivered by the
Company, and are in full force and effect, subject to (i) the effect of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
or other similar laws now or hereafter in effect relating to or affecting
the rights and remedies of creditors and (ii) the effect of general
principles of equity, whether enforcement is considered in a proceeding in
equity or at law, and the discretion of the court before which any
proceeding therefor may be brought.
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(l) When the Offered Securities are delivered and paid for pursuant to
this Agreement on each Closing Date, the Company and each of its
Subsidiaries will have good and marketable title in fee simple to all items
of real property and good and marketable title to all personal property and
assets owned by each of them, in each case free and clear of any security
interests, liens, encumbrances, equities, claims and other defects, except
such as where the failure to have such title would not result in a Material
Adverse Effect or do not materially and adversely affect the value of such
property or materially interfere with the use made or proposed to be made
of such property by the Company or such Subsidiary (except in each case
liens securing indebtedness of the Company or its Subsidiaries as reflected
in its financial statements included in the Prospectus), and any real
property and buildings held under lease by the Company or any such
Subsidiary are held under valid, subsisting and enforceable leases, except
which would not result in a Material Adverse Effect or do not materially
interfere with the use made or proposed to be made of such property and
buildings by the Company or such Subsidiary, in each case except as
described in or contemplated by the Prospectus. To the knowledge of the
Company and the Operating Partnership: (i) no lessee of any portion of the
properties is in material default under any of the leases governing such
properties and there is no event which, but for the passage of time or the
giving of notice, or both, would constitute a default under any of such
leases, except in each case such defaults that would not have a Material
Adverse Effect; (ii) the current use and occupancy of each of the
properties complies in all material respects with all applicable codes and
zoning laws and regulations, except for such failures to comply which would
not individually or in the aggregate have a Material Adverse Effect; and
(iii) there is no pending or threatened condemnation, zoning change,
environmental or other proceeding or action that will in any material
respect affect the size of, use of, improvements on, construction on, or
access to the properties except such proceedings or actions that would not
have a Material Adverse Effect.
(m) The Company and its Subsidiaries possess adequate certificates,
authorities, consents, authorizations or permits issued by appropriate
governmental agencies or bodies necessary to conduct the business now
operated by them, have complied, in all material respects, with the laws,
regulations and orders known by them to be applicable to them or their
respective businesses and properties and have not received any notice of
proceedings relating to the revocation or modification of any such
certificate, authority, consents, authorizations or permit that, if
determined adversely to the Company or any of its Subsidiaries, would
individually or in the aggregate have a Material Adverse Effect.
(n) No labor dispute with the employees of the Company or any
Subsidiary exists or, to the knowledge of the Company, is threatened or
imminent that might have a Material Adverse Effect.
(o) The Company and its Subsidiaries own, possess, license or can
acquire on reasonable terms, adequate trademarks, trade names, licenses,
and other rights to inventions, know-how, patents, copyrights, confidential
or proprietary information and other intellectual property (collectively,
"INTELLECTUAL PROPERTY RIGHTS") necessary to conduct the business now
operated by them, or presently employed by them, and have not received any
notice of infringement of or conflict with asserted rights of others with
respect to any intellectual property rights that, if determined adversely
to the Company or
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any of its Subsidiaries, would individually or in the aggregate have a
Material Adverse Effect.
(p) Except for activities, conditions, circumstances or matters that
would not have a Material Adverse Effect, (A) to the knowledge of the
Company, after due inquiry, neither the Company nor any of the Subsidiaries
has violated (i) any foreign, federal, state or local law or regulation
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("ENVIRONMENTAL LAWS") (and the Company and the Subsidiaries are in
compliance with all requirements of applicable permits, licenses, approvals
or other Authorizations issued pursuant to Environmental Laws), (ii) any
provisions of the Employee Retirement Income Security Act of 1974, as
amended or (iii) any provisions of the Foreign Corrupt Practices Act, or
the rules and regulations promulgated thereunder; (B) to the knowledge of
the Company and the Subsidiaries, after due inquiry, none of the Company or
the Subsidiaries has caused or suffered to occur any Release (as
hereinafter defined) of any Hazardous Substance (as hereinafter defined)
into the Environment (as hereinafter defined) on, in, under or from any
property, and no condition exists on, in, under or adjacent to any property
that would reasonably be expected to result in the incurrence of
liabilities under, or any violations of, any Environmental Law or give rise
to the imposition of any Lien (as hereinafter defined), under any
Environmental Law; (C) none of the Company or the Subsidiaries has received
any written notice of a material claim under or pursuant to any
Environmental Law or under common law pertaining to Hazardous Substances
on, in, under or originating from any property; (D) none of the Company or
any of the Subsidiaries has actual knowledge of, or received any written
notice from any Governmental Authority (as hereinafter defined) claiming,
any material violation of any Environmental Law or a determination to
undertake and/or request the investigation, remediation, clean-up or
removal of any Hazardous Substance released into the Environment on, in,
under or from any property; and (E) no property is included or, to the
knowledge of the Company and the Subsidiaries, after due inquiry, proposed
for inclusion on the National Priorities List issued pursuant to CERCLA (as
hereinafter defined) by the United States Environmental Protection Agency
(the "EPA"), or included on the Comprehensive Environmental Response,
Compensation, and Liability Information System database maintained by the
EPA, and none of the Company and the Subsidiaries has actual knowledge that
any property has otherwise been identified in a published writing by the
EPA as a potential CERCLA removal, remedial or response site or, to the
knowledge of the Company and the Subsidiaries, is included on any similar
list of potentially contaminated sites pursuant to any other Environmental
Law.
As used herein, "HAZARDOUS SUBSTANCE" shall include any hazardous
substance, hazardous waste, toxic substance, pollutant or hazardous
material, including, without limitation, oil, petroleum or any
petroleum-derived substance or waste, asbestos or asbestos-containing
materials, PCBs, pesticides, explosives, radioactive materials, dioxins,
urea formaldehyde insulation or any constituent of any such substance,
pollutant or waste which is subject to regulation under any Environmental
Law (including, without limitation, materials listed in the United States
Department of Transportation Optional Hazardous Material Table, 49 C.F.R.
ss. 172.101, or in the EPA's List of Hazardous Substances and Reportable
Quantities, 40 C.F.R. Part 302); "ENVIRONMENT" shall mean any surface
water, drinking water, ground water, land surface, subsurface strata, river
sediment, buildings, structures, and indoor and outdoor air; "ENVIRONMENTAL
LAW" shall
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mean the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended (42 U.S.C. ss. 9601 et seq.) ("CERCLA"), the
Resource Conservation and Recovery Act of 1976, as amended (42 U.S.C. ss.
6901, et seq.), the Clean Air Act, as amended (42 U.S.C. ss. 7401, et
seq.), the Clean Water Act, as amended (33 U.S.C. ss. 1251, et seq.), the
Toxic Substances Control Act, as amended (15 U.S.C. ss. 2601, et seq.), the
Occupational Safety and Health Act of 1970, as amended (29 U.S.C. ss. 651,
et seq.), the Hazardous Materials Transportation Act, as amended (49 U.S.C.
ss. 1801, et seq.), and all other federal, state and local laws,
ordinances, regulations, rules and orders relating to the protection of the
environment or of human health from environmental effects; "GOVERNMENTAL
AUTHORITY" shall mean any federal, state or local governmental office,
agency or authority having the duty or authority to promulgate, implement
or enforce any Environmental Law; "LIEN" shall mean, with respect to any
property, any mortgage, deed of trust, pledge, security interest, lien,
encumbrance, penalty, fine, charge, assessment, judgment or other liability
in, on or affecting such property; and "RELEASE" shall mean any spilling,
leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, dumping, emanating or disposing of any Hazardous
Substance into the Environment, including, without limitation, the
abandonment or discard of barrels, containers, tanks (including, without
limitation, underground storage tanks) or other receptacles containing or
previously containing and containing a residue of any Hazardous Substance.
(q) To the knowledge of the Company, none of the environmental
consultants which prepared environmental and asbestos inspection reports
with respect to any of the properties was employed for such purpose on a
contingent basis or has any substantial interest in the Company or any of
the Subsidiaries, and none of them nor any of their directors, officers or
employees is connected with the Company or any of the Subsidiaries as a
promoter, selling agent, voting trustee, director, officer or employee.
(r) Except as disclosed in the Prospectus, to the knowledge of the
Company, after due inquiry, there are no pending actions, suits or
proceedings against or affecting the Company, any of its Subsidiaries or
any of their respective properties or any of their respective officers or
trustees that, if determined adversely to the Company or any of its
Subsidiaries or any of their respective officers or trustees, would
individually or in the aggregate have a Material Adverse Effect, or would
materially and adversely affect the ability of the Company to perform its
obligations under this Agreement, or which are otherwise material in the
context of the sale of the Offered Securities and/or are required to be
described in the Registration Statement or Prospectus; and, to the
knowledge of the Company, no such actions, suits or proceedings are
threatened or contemplated, in each case, before or by any federal or state
court, commission, regulatory body, administrative agency or other
governmental body, domestic or foreign, having jurisdiction over the
Company, any of its Subsidiaries or assets; and no contract, statute,
regulation or other document is required to be described in the
Registration Statement or the Prospectus or to be filed as an exhibit to
the Registration Statement that is not described therein or filed as
required.
(s) The consolidated financial statements and schedules and notes
thereto of the Company and its consolidated Subsidiaries included in the
Registration Statement and the Prospectus comply in all material respects
with the requirements of the Act and the Exchange Act, as applicable, and
fairly present the financial position of the Company and
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its consolidated Subsidiaries and the results of operations and changes in
financial condition as of the dates and periods therein specified. Such
financial statements, schedules and notes have been prepared in accordance
with generally accepted accounting principles consistently applied
throughout the periods involved (except as otherwise noted therein). The
selected financial data set forth under the caption "Selected Financial
Information" in the Prospectus fairly present, on the basis stated in the
Prospectus, the information included therein. Except as otherwise noted in
the Prospectus, as adjusted financial information included in the
Prospectus has been prepared in accordance with the applicable requirements
of the Act and the American Institute of Certified Public Accountants
guidelines with respect to as adjusted financial information, and includes
where required all adjustments necessary to present fairly the as adjusted
financial condition of the Company and the Subsidiaries presented or
included at the respective dates indicated and the results of operations
and cash flows for the respective periods specified; and the assumptions
used in preparing the as adjusted financial statements included in the
Registration Statement and the Prospectus provide a reasonable basis for
presenting the significant effects directly attributable to the
transactions or events described therein, the related as adjusted
adjustments give appropriate effect to those assumptions, and the as
adjusted columns therein reflect the proper application of those
adjustments to the corresponding historical financial statement amounts. No
other financial statements (or schedules) of the Company or any predecessor
of the Company are required by the Act to be included in the Registration
Statement or the Prospectus.
(t) PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Company and its consolidated subsidiaries and delivered
their report with respect to the audited consolidated financial statements
and schedules included in the Registration Statement and the Prospectus,
are independent public accountants as required by the Act and the Exchange
Act.
(u) Subsequent to the respective dates as of which information is
given in the Registration Statement or the Prospectus and prior to the
First Closing Date, (i) neither the Company nor any of its Subsidiaries has
sustained any material casualty loss, condemnations or interference with
their respective businesses or properties from fire, flood, hurricane,
accident or other calamity, whether or not covered by insurance, or from
any labor dispute or any legal or governmental proceeding, (ii) there has
not been any material adverse change, or any development or event that
would be reasonably likely to result in a material adverse change, in the
condition (financial or otherwise), management, business, properties,
prospects, net worth, or results of operations of the Company or any of its
Subsidiaries, taken as a whole, except in each case as described in or
contemplated by the Prospectus and (iii) except as disclosed in or
contemplated by the Prospectus or otherwise consistent with past practice,
there has been no dividend or distribution of any kind declared, paid or
made by the Company on any class of its capital stock.
(v) The Company is not and, after giving effect to the offering and
sale of the Offered Securities and the application of the proceeds thereof
as described in the Prospectus, will not be an "investment company" as
defined in the Investment Company Act of 1940, as amended.
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(w) The Company has not, directly or indirectly, (i) taken any action
designed to cause or to result in, or that has constituted or which 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 Offered Securities or (ii) since the filing of the Registration
Statement (A) sold, bid for, purchased, or paid anyone any compensation for
soliciting purchases of, the Offered Securities or (B) paid or agreed to
pay to any person any compensation for soliciting another to purchase any
other securities of the Company.
(x) The Company has not distributed and, prior to the later of (i) the
First Closing Date and (ii) the completion of the distribution of the
Offered Securities, will not distribute any offering material in connection
with the offering and sale of the Offered Securities other than the
Registration Statement or any amendment thereto, or the Prospectus or any
amendment or supplement thereto, or other materials, if any permitted by
the Act.
(y) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, (1) the Company and
its Subsidiaries have not incurred any material liability or obligation,
direct or contingent, nor entered into any material transaction, in each
case, not in the ordinary course of business; (2) the Company has not
purchased any of its outstanding shares of beneficial interest, nor
declared, paid or otherwise made any dividend or distribution of any kind
on its shares of beneficial interest except in the ordinary course of
business consistent with past practices; and (3) there has not been any
material change in the capitalization, equity, short-term debt or long-term
debt of the Company and its consolidated Subsidiaries, except in each case
as described in or contemplated by the Prospectus.
(z) The Company and each of its Subsidiaries are insured by property,
title, casualty and liability insurers of recognized financial
responsibility against such losses and risks and in such amounts as are
prudent and customary in the businesses in which they are engaged; neither
the Company nor any such Subsidiary has been refused any insurance coverage
sought or applied for; and neither the Company nor any such Subsidiary has
any reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its business
at a cost that would not result in Material Adverse Effect, except in such
instances where the tenant is carrying such insurance or the tenant is
self-insuring such risks and except as described in or contemplated by the
Prospectus.
(aa) No Subsidiary of the Company is currently prohibited, directly or
indirectly, from paying any dividends to the Company, from making any other
distribution on the equity interest in such Subsidiary held by the Company,
from repaying to the Company any loans or advances to such Subsidiary from
the Company or from transferring any of such Subsidiary's property or
assets to the Company or any other Subsidiary of the Company, except as
described in or contemplated by the Prospectus or pursuant to the terms of
its outstanding securities or a bona fide financing transaction.
(bb) The Company and each of its Subsidiaries has filed all foreign,
federal, state and local income tax returns that are required to be filed
or has requested extensions thereof (except in any case in which the
failure so to file would not have a Material
15
Adverse Effect) and has paid all taxes required to be paid by it and any
other assessment, fine or penalty levied against it, to the extent that any
of the foregoing is due and payable, except for any such tax, assessment,
fine or penalty that is currently being contested in good faith or as
described in or contemplated by the Prospectus or which would not result in
a Material Adverse Effect.
(cc) Commencing with the Company's taxable year ended December 31,
1994, the Company was organized and has operated in conformity with the
requirements for qualification and taxation as a real estate investment
trust ("REIT") under Sections 856 through 860 of the Internal Revenue Code
of 1986, as amended (the "CODE"), and its proposed method of operations
will enable it to continue to meet the requirements for qualification and
taxation as a REIT. All statements in the Prospectus regarding the
Company's qualification as a REIT are true, complete and correct in all
material respects.
(dd) Each certificate signed by any officer or authorized
representative of the Company or any Subsidiary and delivered to the
Representatives or counsel for the Underwriters shall be deemed to be a
representation and warranty by the Company or any Subsidiary to each
Underwriter as to the matters covered thereby.
(ee) Except for the shares of capital stock or other equity interests
of each of the Subsidiaries owned by the Company and such Subsidiaries,
neither the Company nor any such Subsidiary owns any shares of stock or any
other equity securities of any corporation or has any equity interest in
any firm, partnership, association or other entity, except as described in
or contemplated by the Prospectus.
(ff) The Company and each of its Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance
that (1) transactions are executed in accordance with management's general
or specific authorizations; (2) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (3)
access to assets, financial and corporate books and records is permitted
only in accordance with management's general or specific authorization; and
(4) the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with respect
to any differences.
(gg) Neither the Company nor any of the Subsidiaries is in breach or
violation of its respective declaration of trust, charter, bylaws,
partnership agreement or other organizational document, as the case may be,
or in default in the performance of any obligation, agreement, covenant or
condition contained in any indenture, loan agreement, mortgage, bond,
debenture, note agreement, joint venture or partnership agreement, lease or
other agreement or instrument that is material to the Company and the
Subsidiaries, taken as a whole, and to which the Company or any of the
Subsidiaries is a party or by which the Company or any of the Subsidiaries
or their respective property is bound (and there is no event which, but for
the passage of time or the giving of notice, or both, would constitute a
default under any of foregoing), where such violation or default would have
a Material Adverse Effect.
(hh) Since January 1, 1998, the Company has timely filed all documents
required to be filed by it under the Exchange Act.
16
(ii) No relationship, direct or indirect, exists between or among the
Company or the Subsidiaries on the one hand, and the trustees,
directors, officers, shareholders, customers or suppliers of the
Company or the Subsidiaries on the other hand, which is required by the
Act or the rules of the NASD to be described in the Registration
Statement and the Prospectus which is not so described.
(jj) There are no contracts, agreements, letters of intent, understandings
or any other documents relating to the pending acquisition of any real
property by the Company or the Operating Partnership that are required
to be disclosed in the Prospectus and that are not so disclosed.
3. PURCHASE, SALE AND DELIVERY OF OFFERED SECURITIES. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to purchase
from the Company, at a purchase price of $24.0625 per share, the respective
numbers of shares of Firm Securities set forth opposite the names of the
Underwriters in Schedule I hereto. In order the meet the requirements for
listing the Offered Securities on the NYSE, the Underwriters undertake to sell
(i) the Offered Securities to ensure a minimum of 100 beneficial holders with a
minimum of 100,000 Offered Securities outstanding and (ii) sufficient Offered
Securities so that following the offering of the Offered Securities, the Offered
Securities have a minimum aggregate market value of at least $2.0 million.
The Company will deliver the Firm Securities, with transfer taxes thereon
duly paid, to the Representatives in book entry form through the facilities of
The Depository Trust Company ("DTC") for the respective accounts of the
Underwriters against payment of the purchase price in Federal (same day) funds
by wire transfer to an account of the Company, in connection with the closing of
such transactions, at the office of Morgan, Lewis & Bockius LLP, Philadelphia,
Pennsylvania, at 10:00 A.M., New York time, on April 6, 2001, or at such other
time not later than seven full business days thereafter as Credit Suisse First
Boston Corporation ("CSFBC") and the Company determine, such time being herein
referred to as the "FIRST CLOSING DATE". For purposes of Rule 15c6-1 under the
Exchange Act, the First Closing Date (if later than the otherwise applicable
settlement date) shall be the settlement date for payment of funds and delivery
of securities for all the Offered Securities sold pursuant to the offering.
Prior to the First Closing Date, the Company will also deliver the form of fully
registered global certificate that will be deposited with DTC for the Firm
Securities that the several Underwriters have agreed to purchase hereunder.
In addition, upon written notice from CSFBC given to the Company from time
to time not more than 30 days subsequent to the date of the Prospectus (or, if
such 30th day shall be a Saturday or Sunday or a holiday, on the next business
day thereafter when the NYSE is open for trading), the Underwriters may purchase
all or less than all of the Optional Securities at the per share purchase price
(including any accumulated dividends thereon to the related Optional Closing
Date (as hereinafter defined)) to be paid for the Firm Securities. The
Underwriters shall not be under any obligation to purchase any of the Optional
Securities prior to the exercise of such option. The Company agrees to sell to
the Underwriters the number of shares of Optional Securities specified in such
notice and the Underwriters agree, severally and not jointly, to purchase such
Optional Securities. Such Optional Securities shall be purchased for the account
of each Underwriter in the same proportion as the number of shares of Firm
Securities set forth opposite such Underwriter's name bears to the total number
of shares of Firm Securities (subject
17
to adjustment by CSFBC to eliminate fractions) and may be purchased by the
Underwriters only for the purpose of covering over-allotments made in connection
with the sale of the Firm Securities. No Optional Securities shall be sold or
delivered unless the Firm Securities previously have been, or simultaneously
are, sold and delivered. The right to purchase the Optional Securities or any
portion thereof may be exercised from time to time and to the extent not
previously exercised may be surrendered and terminated at any time upon notice
by CSFBC to the Company.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "OPTIONAL CLOSING Date," which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "CLOSING DATE"), shall be determined by CSFBC
but shall be not later than five (5) full business days after written notice of
election to purchase Optional Securities is given. The Company will deliver the
Optional Securities being purchased, with transfer taxes thereon duly paid, to
the Representatives in book entry form through the facilities of the DTC on each
Optional Closing Date for the accounts of the several Underwriters against
payment of the purchase price in Federal (same day) funds by wire transfer to an
account of the Company, in connection with the closing of the transactions, at
the above office. Prior to each Optional Closing Date, the Company will also
deliver the form of fully registered global certificate that will be deposited
with DTC for the Optional Securities that the several Underwriters have agreed
to purchase hereunder.
4. OFFERING BY UNDERWRITERS. It is understood that the several Underwriters
propose to offer the Offered Securities for sale to the public as set forth in
the Prospectus.
5. CERTAIN AGREEMENTS OF THE COMPANY AND THE OPERATING PARTNERSHIP. The
Company and the Operating Partnership agree with the several Underwriters that:
(a) The Company will file the final Prospectus with the Commission
pursuant to and in accordance Rule 424(b) not later than the second
business day following the execution and delivery of this Agreement). The
Company will advise CSFBC promptly of any such filing pursuant to Rule
424(b).
(b) The Company will advise CSFBC promptly of any proposal to amend or
supplement the Registration Statement as filed or the related Prospectus
and will not effect such amendment or supplementation without CSFBC's
consent which shall not be unreasonably withheld. The Company will prepare
and file with the Commission, in accordance with the rules and regulations
of the Commission, promptly upon request by the Representatives or counsel
for the Underwriters, any amendments to the Registration Statement or
amendments or supplements to the Prospectus that may be necessary or
advisable in connection with the distribution of the Offered Securities by
the several Underwriters, and will use its best efforts to cause any such
amendment to the Registration Statement to be declared effective by the
Commission as promptly as possible. The Company will also advise CSFBC
promptly of the effectiveness of each Registration Statement (if its
Effective Time is subsequent to the execution and delivery of this
Agreement) and of any amendment or supplementation of a Registration
Statement or the Prospectus and of the institution by the Commission of any
stop order proceedings in respect of a Registration Statement and of the
suspension of the qualification of the Offered Securities for offering or
sale in any jurisdiction and will use
18
its best efforts to prevent the issuance of any such stop order and to
obtain as soon as possible its lifting, if issued.
(c) The Company will advise CSFBC, promptly after receiving notice or
obtaining knowledge thereof and, if requested by the Underwriters, to
confirm such advice in writing, of (i) the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement
or any Registration Statement filed under Rule 462(b) ("RULE 462(B)") under
the Act or any post-effective amendment thereto or any order directed at
any document incorporated by reference in the Registration Statement or the
Prospectus or any amendment or supplement thereto or any order preventing
or suspending the use of any Prospectus or any amendment or supplement
thereto, (ii) the suspension of the qualification of the Offered Securities
for offering or sale in any jurisdiction, (iii) the institution,
threatening or contemplation of any proceeding for any such purpose, (iv)
the effectiveness of any amendment to the Registration Statement or any
Rule 462(b) Registration Statement, the transmittal to the Commission for
filing of any Prospectus or other supplement or amendment thereto to be
filed pursuant to the Act, any request made by the Commission for amending
the Registration Statement or any Rule 462(b) Registration Statement, for
amending or supplementing any preliminary Prospectus or the Prospectus or
for additional information or (v) the happening of any event during the
period referred to in Section 5(d) below which makes any statement of a
material fact made in the Registration Statement or Prospectus untrue or
which requires any additions to or changes in the foregoing in order to
make the statements therein not misleading. The Company will use its best
efforts to prevent the issuance of any such stop order and, if any such
stop order is issued, to obtain the withdrawal or lifting thereof as
promptly as possible.
(d) At any time when a prospectus relating to the Offered Securities
is required to be delivered under the Act in connection with sales by any
Underwriter or dealer, the Company (i) will comply with all requirements
imposed upon it by the Act and the Exchange Act to the extent necessary to
permit the continuance of sales of or dealings in the Offered Securities in
accordance with the provisions hereof and of the Prospectus, as then
amended or supplemented, (ii) will not file with the Commission the
Prospectus, any amendment or supplement thereto or any amendment to the
Registration Statement or any Rule 462(b) Registration Statement of which
the Representatives shall not previously have been advised and furnished
with a copy for a reasonable period of time prior to the proposed filing
and as to which filing the Representatives shall not have given their
consent which shall not be unreasonably withheld, and (iii) if 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 any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus to comply with the Act, will
promptly notify CSFBC of such event and will promptly prepare and file with
the Commission, at its own expense, an amendment or supplement which will
correct such statement or omission or an amendment which will effect such
compliance. Neither CSFBC's consent to, nor the Underwriters' delivery of,
any such amendment or supplement shall constitute a waiver of any of the
conditions set forth in Section 6.
(e) As soon as practicable, but not later than the Availability Date
(as hereinafter defined), the Company will make generally available to its
securityholders an
19
earnings statement covering a period of at least 12 months beginning after
the Effective Date of the Initial Registration Statement which will satisfy
the provisions of Section 11(a) of the Act. For the purpose of the
preceding sentence, "AVAILABILITY DATE" means the 45th day after the end of
the fourth fiscal quarter following the fiscal quarter that includes such
Effective Date, except that, if such fourth fiscal quarter is the last
quarter of the Company's fiscal year, "AVAILABILITY DATE" means the 90th
day after the end of such fourth fiscal quarter.
(f) The Company will furnish, without charge, to the Representatives
copies of each preliminary Prospectus included in the Registration
Statement, and, so long as a prospectus relating to the Offered Securities
is required to be delivered under the Act in connection with sales by any
Underwriter or dealer, the Prospectus and all amendments and supplements to
such documents (in each case including exhibits thereto), in each case in
such quantities as CSFBC requests. The Prospectus shall be so furnished on
or prior to 3:00 P.M., New York time, on the business day following the
later of the execution and delivery of this Agreement or the Effective Time
of the Registration Statement. All other documents shall be so furnished as
soon as available. The Company will pay the expenses of printing and
distributing to the Underwriters all such documents.
(g) The Company will arrange for the registration or qualification of
the Offered Securities for offering and sale under the applicable state
securities or blue sky laws and real estate syndication laws of such
jurisdictions as CSFBC designates and will continue such registration or
qualifications in effect for as long as may be necessary to complete the
distribution of the Offered Securities and to file such consents to service
of process or other documents as may be necessary in order to effect such
registration or qualification; provided, however, that in connection
therewith the Company shall not be required to qualify as a foreign
corporation or to execute a general consent to service of process in any
jurisdiction.
(h) During the period of five years hereafter, the Company will
furnish to the Representatives and, upon request, to each of the other
Underwriters, as soon as practicable after the end of each fiscal year, a
copy of its annual report to shareholders for such year; and the Company
will furnish to the Representatives (i) as soon as available, a copy of
each report and any definitive proxy statement of the Company filed with
the Commission under the Exchange Act or mailed to shareholders, and (ii)
from time to time, such other information concerning the Company as CSFBC
may reasonably request.
(i) The Company will pay all costs, fees, taxes and expenses incident
to the performance of its obligations under this Agreement, whether or not
the transactions contemplated herein are consummated or this Agreement is
terminated, including all costs, fees, taxes and expenses incident to (i)
the printing, filing or other production of documents with respect to the
transactions, including any costs of printing the Registration Statement
originally filed with respect to the Offered Securities and any amendment
thereto, any Rule 462(b) Registration Statement and the Prospectus and any
amendment or supplement thereto, this Agreement and any blue sky memoranda,
(ii) all arrangements relating to the mailing and delivery to the
Underwriters of copies of the foregoing documents, (iii) the fees, expenses
and disbursements of the counsel, accountants and any other experts or
advisors retained by the Company, (iv) preparation,
20
printing, issuance and delivery to the Underwriters of any certificates
evidencing the Offered Securities, including transfer agent's and
registrar's fees, (v) the filing of the Articles Supplementary with the
SDAT and the registration or qualification of the Offered Securities under
state securities and blue sky laws and the real estate syndication laws of
the several states, including filing fees and fees and disbursements of
counsel for the Underwriters relating thereto, (vi) the filing fees and
disbursement of counsel for the Underwriters solely in connection with the
review and clearance of the offering of the Offered Securities by the
Commission (and the NASD) relating to the Offered Securities, (vii) the
listing of the Offered Securities on the NYSE, (viii) meetings with
prospective investors in the Offered Securities (other than shall have been
specifically approved by the Representatives to be paid for by the
Underwriters), (ix) advertising approved by the Company relating to the
offering of the Offered Securities (other than shall have been specifically
approved by the Representatives to be paid for by the Underwriters) and (x)
any transfer taxes imposed on the sale by the Company of the Offered
Securities to the Underwriters. If the sale of the Offered Securities
provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not
satisfied, because this Agreement is terminated or because of any failure,
refusal or inability on the part of the Company or the Operating
Partnership to perform all obligations and satisfy all conditions on its
part to be performed or satisfied hereunder other than by reason of a
default by any of the Underwriters, the Company and the Operating
Partnership will reimburse the Underwriters severally upon demand for all
out-of-pocket expenses (including fees and disbursements of counsel) that
are the responsibility of the Company pursuant to this Section 5(i) and
that shall have been incurred by them in connection with the proposed
purchase and sale of the Offered Securities. The Company and the Operating
Partnership shall not in any event be liable to any of the Underwriters for
the loss of anticipated profits from the transactions covered by this
Agreement.
(j) The Company will apply the net proceeds from the sale of the
Offered Securities as set forth under "Use of Proceeds" in the Prospectus.
(k) The Company will not, at any time, directly or indirectly, (i)
take any action designed to cause or to result in, or that has constituted
or which 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 Offered Securities or (ii) (A) sell, bid for,
purchase, or pay anyone any compensation for soliciting purchases of, the
Offered Securities or (B) pay or agree to pay to any person any
compensation for soliciting another to purchase any other securities of the
Company.
(l) If at any time during the first to conclude of the 25-day period
after the Registration Statement becomes effective or the period prior to
the Optional Closing Date, any rumor, publication or event relating to or
affecting the Company shall occur as a result of which in your opinion the
market price of the Offered Securities has been or is likely to be
materially affected (regardless of whether such rumor, publication or event
necessitates a supplement to or amendment of the Prospectus), the Company
will, after notice from you advising the Company to the effect set forth
above, forthwith prepare, consult with you concerning the substance of, and
disseminate a press release or other public statement, reasonably
satisfactory to you, responding to or commenting on such rumor, publication
or event.
21
(m) If the Company elects to rely on Rule 462(b), the Company shall
both file a Rule 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) and pay the applicable fees or give irrevocable
instructions for the payment of such fees in accordance with Rule 111
promulgated under the Act by the earlier of (i) 10:00 P.M. Eastern time on
the date of this Agreement and (ii) the time confirmations are sent or
given, as specified by Rule 462(b)(2).
(n) The Company will use its best efforts to cause the Offered
Securities to be duly authorized for listing by the NYSE prior to the First
Closing Date and to maintain the listing of the Offered Securities on the
NYSE for a period of two years after the First Closing Date and thereafter
unless the Company's Board of Trustees determines that it is no longer in
the best interests of the Company for the Offered Securities to continue to
be so listed.
(o) During the period when the Prospectus is required to be delivered
under the Act or the Exchange Act in connection with sales of the Offered
Securities, to file all documents required to be filed by it with the
Commission pursuant to Section 13, 14 or 15 of the Exchange Act within the
time periods required by the Exchange Act.
(p) To use its best efforts to do and perform all things required to
be done and performed under this Agreement by the Company or the Operating
Partnership prior to the First Closing Date and Optional Closing Date, as
the case may be, and to satisfy all conditions precedent to the delivery of
the Offered Securities.
(q) The Company will use its best efforts to continue to qualify as a
REIT under Sections 856 through 860 of the Code unless the Company's Board
of Trustees determines that it is no longer in the best interests of the
Company to be so qualified.
(r) The Company shall duly file the Articles Supplementary designating
the Preferred Shares with the SDAT.
6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The obligations of
the several Underwriters to purchase and pay for the Firm Securities under this
Agreement shall be subject, in the Representatives' sole discretion, to the
satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company and the
Operating Partnership contained in this Agreement and all statements of
officers of the Company and Operating Partnership made pursuant to this
Agreement shall be true and correct, in all material respects, on the First
Closing Date with the same force and effect as if made on and as of the
First Closing Date.
(b) The Registration Statement, including any Rule 462(b) Registration
Statement, has become effective under the Act; the Prospectus, as the case
may be, and any amendment or supplement thereto, shall have been filed with
the Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing by such Rule; if the Company is required to file
a Rule 462(b) Registration Statement after the effectiveness of this
Agreement, such Rule 462(b) Registration Statement shall have been filed by
10:00 A.M., New York City time, on the day after the date of this
Agreement; and no stop order suspending the effectiveness of the
Registration Statement
22
or any post-effective amendment thereto and no order directed at any
document incorporated by reference in the Registration Statement or the
Prospectus or any amendment or supplement thereto shall have been issued,
and no proceedings for that purpose shall have been instituted or
threatened, or, to the knowledge of the Company, after due inquiry, shall
be contemplated by the Commission. No stop order suspending the
effectiveness of the Registration Statement or any post-effective amendment
thereto and no order directed at any document incorporated by reference in
the Registration Statement or the Prospectus or any amendment or supplement
thereto shall have been issued, and no proceedings for that purpose shall
have been instituted or threatened, or, to the knowledge of the Company,
after due inquiry, shall be contemplated by the state securities authority
of any jurisdiction.
(c) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company and its
Subsidiaries taken as one enterprise which, in the judgment of a majority
in interest of the Underwriters including the Representatives, is material
and adverse and makes it impractical or inadvisable to proceed with
completion of the public offering or the sale of and payment for the
Offered Securities; (ii) any downgrading in the rating of any debt
securities or preferred stock of the Company by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g)
under the Act), or any public announcement that any such organization has
under surveillance or review its rating of any debt securities or preferred
stock of the Company (other than an announcement with positive implications
of a possible upgrading, and no implication of a possible downgrading, of
such rating); (iii) any material suspension or material limitation of
trading in securities generally on the NYSE, or any setting of minimum
prices for trading on such exchange, or any suspension of trading of any
securities of the Company on any exchange or in the over-the-counter
market; (iv) any banking moratorium declared by U.S. Federal or New York
authorities; or (v) any outbreak or escalation of major hostilities in
which the United States is involved, any declaration of war by Congress or
any other substantial national or international calamity or emergency if,
in the judgment of a majority in interest of the Underwriters including the
Representatives, the effect of any such outbreak, escalation, declaration,
calamity or emergency makes it impractical or inadvisable to proceed with
completion of the public offering or the sale of and payment for the
Offered Securities.
(d) The Representatives shall have received an opinion, dated the
First Closing Date, of Morgan, Lewis & Bockius LLP, counsel for the
Company, to the effect that:
(i) The Company and each of its Subsidiaries set forth on
Schedule IV to this Agreement are validly existing as corporations,
limited partnerships or other legal entities, as the case may be in
good standing under the laws of their respective jurisdictions of
formation and are duly qualified and registered to transact business
as foreign corporations, limited partnerships or other legal entities,
as the case may be and are in good standing under the laws of the
jurisdictions identified on Schedule II hereto where the ownership or
leasing of their respective properties or the conduct of their
respective businesses requires
23
such qualification, except where the failure to be so qualified would
not have a Material Adverse Effect;
(ii) The Company and each of the Subsidiaries set forth on
Schedule IV to this Agreement have corporate, trust or partnership
authority or power, whichever is appropriate, to own, operate or lease
their respective properties and other assets and conduct the
respective businesses in which they are engaged or propose to engage,
in each case, as described in the Registration Statement and the
Prospectus, and the Company and the Operating Partnership have
corporate or other power to enter into this Agreement and to carry out
all the terms and provisions hereof to be carried out by them;
(iii) The issued and outstanding common and preferred units of
limited partnership of the Operating Partnership, and the issued and
outstanding membership interests and other equity interests, as the
case may be, of each of the other Subsidiaries have been duly
authorized and validly issued, are with respect to corporate
Subsidiaries fully paid and nonassessable, have been issued in
compliance with all applicable federal and state securities laws and,
to the knowledge of such counsel, were not issued in violation of or
subject to any preemptive rights or other rights to subscribe for or
purchase securities and, except as otherwise set forth in the
Prospectus, to the knowledge of such counsel, are owned beneficially
by the Company free and clear of any perfected security interests or,
any other security interests, liens, encumbrances, equities or claims,
except for security interests, liens, encumbrances, equities or claims
pursuant to the terms of a bona fide financing transaction;
(iv) The Company has an authorized capitalization consisting of
50,000,000 shares of beneficial interest as set forth in the
Prospectus; all of the issued and outstanding shares of beneficial
interest of the Company have been duly authorized and validly issued
and are fully paid and nonassessable, have been issued in compliance
with all applicable federal and state securities laws and, to the
knowledge of such counsel, were not issued in violation of or subject
to any preemptive rights or other rights to subscribe for or purchase
securities; the Offered Securities have been duly authorized for
issuance and sale to the Underwriters pursuant to this Agreement by
all necessary action of the Company and, when validly issued and
delivered to and paid for by the Underwriters pursuant to this
Agreement and in accordance with the resolutions of the Board of
Trustees of the Company authorizing their issuance, will be duly
authorized, validly issued, fully paid and nonassessable; the Offered
Securities have been duly authorized for listing, subject to official
notice of issuance, on the NYSE; no holders of outstanding shares of
beneficial interest of the Company are entitled, to such counsel's
knowledge, to any preemptive or other rights to subscribe for any of
the Offered Securities; the terms of the Offered Securities conform in
all material respects to all statements and descriptions related
thereto under the captions "Description of Shares" and "Description of
Series E Preferred Shares" contained in the Prospectus and to the
descriptions thereof contained in the Articles Supplementary. The form
of share certificate evidencing the Offered Securities is in due and
proper form in all material respects and complies in all material
respects with all applicable legal requirements under Maryland law.
The
24
issuance of the Offered Securities is not subject to any preemptive or
other similar rights arising under Title 8 of the Corporations and
Associations Article of the Annotated Code of Maryland or the
Company's declaration of trust or bylaws, as amended to date;
(v) The statements set forth under the heading "Description of
Series E Preferred Shares" in the Prospectus Supplement, insofar as
such statements purport to summarize certain provisions of the Offered
Securities and charter documents of the Company and the Operating
Partnership, have been reviewed by such counsel and are correct in all
material respects and provide a fair summary of such provisions; and
the statements set forth under the heading "Certain Federal Income Tax
Matters" and "Description of Series E Preferred Shares" in the
Prospectus Supplement, insofar as such statements constitute
statements of law, description of statutes, rules or regulations, a
summary of the legal matters or proposed legislation referred to
therein, have been reviewed by such counsel and are correct in all
material respects and provide a fair summary of such matters;
(vi) The execution and delivery of this Agreement has been duly
authorized by all necessary action of the Company and the Operating
Partnership, and this Agreement has been duly executed and delivered
by the Company and the Operating Partnership, and is valid, legally
binding and enforceable, subject to (a) the effect of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other
similar laws now or hereafter in effect relating to or affecting the
rights and remedies of creditors and (b) the effect of general
principles of equity, whether enforcement is considered in a
proceeding in equity or at law, and the discretion of the court before
which any proceeding therefor may be brought;
(vii) The filing of the Articles Supplementary with the SDAT has
been duly authorized by all necessary action of the Company, and the
Articles Supplementary are in full force and effect subject to (a) the
effect of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to or affecting the rights and remedies of creditors
and (b) the effect of general principles of equity, whether
enforcement is considered in a proceeding in equity or at law, and the
discretion of the court before which any proceeding therefor may be
brought;
(viii) To such counsel's knowledge, no legal or governmental
proceedings are pending to which the Company or any of the
Subsidiaries is a party or to which the property of the Company or any
of the Subsidiaries is subject that are required to be described in
the Registration Statement or the Prospectus and are not described
therein, and the descriptions thereof are accurate in all material
respects and, to the knowledge of such counsel, no such proceedings
have been threatened against the Company or any of the Subsidiaries or
with respect to any of their respective properties; and to such
counsel's knowledge no contract, statutes, regulations or other
document is required to be described in the Registration Statement or
the Prospectus or to be filed as an exhibit to the Registration
Statement that is not described therein or filed as required and the
descriptions of any such contracts, statutes, regulations or other
documents are accurate in all material respects;
25
(ix) To such counsel's knowledge, the issuance, offering and sale
of the Offered Securities to the Underwriters by the Company pursuant
to this Agreement, the execution, delivery, performance and the
compliance by the Company and the Operating Partnership with this
Agreement and the consummation of the other transactions herein
contemplated do not and will not (A) require the consent, approval,
authorization, registration, order, filing or qualification of or with
any court, regulatory body, administrative agency or other
governmental authority, except such as have been obtained and such as
may be required under state securities or blue sky laws or real estate
syndication laws of the various states in connection with the purchase
and distribution of the securities by the Underwriters, except such as
are related to the filing of the Articles Supplementary with the SDAT,
which filing with the SDAT will be made prior to the First Closing
Date, or as may be required under the Act or other securities laws or
bylaws and rules of the NASD, or the listing requirements of the NYSE
or such as have been received prior to the date of the opinion, or (B)
conflict with or result in a breach or violation of any of the terms
and provisions of, or constitute a default under (and there is no
event which, but for the passage of time or the giving of notice, or
both, would constitute a default under any of the foregoing), (x) the
declaration of trust, charter, bylaws, partnership agreement or other
organizational document of the Company or the Subsidiaries, (y) any
document (as in effect on the date of such opinion) listed on Schedule
III to which the Company or any of the Subsidiaries is a party or by
which the Company or any of such Subsidiaries or their respective
property is bound (it being understood that such counsel may assume
compliance with the financial covenants contained in any such
document), (C) violate or conflict with any applicable law, rule or
administrative regulation of the United States, the State of Delaware
or the State of Maryland, or (D) any order or administrative or court
decree of which such counsel is aware, except in each case for
conflicts, breaches, violations or defaults that in the aggregate
would not have a Material Adverse Effect;
(x) The Registration Statement is effective under the Act; the
Prospectus or the Prospectus Supplement, as the case may be, has been
filed with the Commission in the manner and within the time period
required by Rules 424(b); and no stop order suspending the
effectiveness of the Registration Statement or any post-effective
amendment thereto and no order of the Commission directed at any
document incorporated by reference in the Registration Statement or
the Prospectus or any amendment or supplement thereto has been issued,
and no proceedings for that purpose have been instituted or, to the
knowledge of such counsel, are threatened or contemplated by the
Commission;
(xi) The Registration Statement originally filed with respect to
the Offered Securities and each amendment thereto and any Rule 462(b)
Registration Statement, as of the date hereof and at the time it
became effective, the Prospectus, as of its date or when any amendment
or supplement is filed with the Commission (in each case, including
the documents incorporated by reference therein but not including the
financial statements and other financial and statistical information
derived from such financial statements contained therein, as
26
to which such counsel need express no opinion) comply as to form in
all material respects with the applicable requirements of the Act and
the Exchange Act;
(xii) The authorized shares of beneficial interest of the Company
conform as to legal matters in all material respects to the
description thereof contained in the Prospectus or the description
contained in the Articles Supplementary;
(xiii) To the knowledge of such counsel, neither the Company nor
any of the Subsidiaries is in violation of its respective charter,
declaration of trust, bylaws, partnership agreement or other
organizational document, as the case may be, and, to such counsel's
knowledge, neither the Company nor any of such Subsidiaries is in
default in the performance or observance of (and there is no event
which, but for the passage of time or the giving of notice, or both,
would constitute a default under any of the foregoing), any
obligation, agreement, covenant or condition contained in any document
(as in effect on the date of such opinion) listed on Schedule III to
which the Company or any of such Subsidiaries is a party or by which
the Company or any of such Subsidiaries or their respective property
is bound (it being understood that such counsel may assume compliance
with the financial covenants contained in any such document), except
in each case for violations or defaults which in the aggregate are not
reasonably expected to have a Material Adverse Effect;
(xiv) The Company and the Subsidiaries are not and, after giving
effect to the offering and sale of the Offered Securities and the
application of the proceeds thereof as described in the Prospectus,
will not be required to be registered as an "investment company" under
the Investment Company Act of 1940, as amended; and
(xv) To such counsel's knowledge, there are no contracts or
agreements between the Company and any person granting such person the
right to require the Company to include securities of the Company held
by such person with the Offered Securities registered pursuant to the
Registration Statement.
In addition, Morgan, Lewis & Bockius LLP shall confirm that the opinion
filed as Exhibit 8.1 to the Registration Statement is true and correct as of the
date thereof and permit the Underwriters to rely on such opinion as if it were
addressed to the Underwriters.
Further, Morgan, Lewis & Bockius LLP shall state that they have
participated in conferences with officers and other representatives of the
Company and the Subsidiaries, representatives of the independent public
accountants for the Company and representatives of the Underwriters and their
counsel at which the contents of the Registration Statement and the Prospectus
and related matters were discussed. On the basis thereof (relying as to
materiality to the extent it deems appropriate upon the opinions of officers and
other representatives of the Company), but without independent verification by
such counsel of, and without passing upon or assuming any responsibility for,
the accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus or any amendments or supplements
thereto, no facts have
27
come to the attention of such counsel that lead them to believe that (i) the
Registration Statement, at the time such Registration Statement became
effective, contained any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary in order to make
the statements therein not misleading or (ii) the Prospectus, as of its date or
at the First Closing Date contained or contains any untrue statement of a
material fact or omitted or omits to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading (it being understood that such counsel need express no
opinion with respect to the financial statements and related schedules and other
financial and statistical data derived from such financial statements included
in the Registration Statement or the Prospectus).
In giving its opinion, such counsel shall expressly limit their opinion to
matters of Federal and Pennsylvania law and the Revised Uniform Limited
Partnership Act, the General Corporation Law of the State of Delaware and Title
8 of the Corporations and Associations Article of the Annotated Code of Maryland
and may rely without independent verification (A) as to all matters of fact,
upon certificates and written statements of officers, trustees, directors,
partners and employees of and accountants for the Company and the Subsidiaries
and (B) as to the good standing and qualification of the Company and the
Subsidiaries, to do business in any state or jurisdiction, upon certificates of
appropriate government officials or opinions of counsel in such jurisdictions.
Counsel need express no opinion (i) as to the enforceability of forum selection
clauses in the federal courts or (ii) with respect to the requirements of, or
compliance with, any state securities or blue sky or real estate syndication
laws.
For the purposes of the opinions presented in this Section 6(d), the term
"Subsidiaries" shall include only those subsidiaries that are listed on Schedule
IV. References to the Registration Statement and the Prospectus in this
paragraph (c) shall include any amendment or supplement thereto at the date of
such opinion.
(e) You shall have received on the First Closing Date an opinion or
opinions (satisfactory to you and your counsel), dated the First Closing Date,
of John H. Gurley, Esq., General Counsel to the Company, as to the matters
referred to in clauses (i), (ii), (iii), (viii), (ix), (xiii) and (xiv) of
Section 6(d) and in addition, John H. Gurley shall make statements similar to
those contained in the second and third paragraphs following Section 6(d)(xv)
hereto and shall be entitled to rely on those persons described in the third
paragraph following Section 6(d)(xv) described therein. For the purposes of the
opinions presented in this Section 6(e), the term "Subsidiaries" shall include
only those subsidiaries that are listed on Schedule V.
(f) You shall have received on the First Closing Date an opinion, dated the
First Closing Date, of Clifford Chance Rogers & Wells LLP, counsel for the
Underwriters, as to the matters referred to in clauses (iv) (with respect to the
third and fifth clauses only), (v) (with respect to "Description of Series E
Preferred Shares" only), (vi) (except with respect to the last clause thereof)
and (xi) of Section 6(d) and in addition, Clifford Chance Rogers & Wells LLP
shall make statements similar to those contained in the second and third
paragraphs following Section 6(d)(xv) hereto (with respect to Federal, New York,
Delaware and Maryland laws only) and shall be entitled to
28
rely on those persons described in the third paragraph following Section
6(d)(xv) described therein.
(g) You shall have received, on each of the date hereof and the First
Closing Date, a letter dated the date hereof or the First Closing Date, as the
case may be, in form and substance satisfactory to you (and your counsel), from
PricewaterhouseCoopers LLP, independent public accountants, confirming that they
are independent public accountants with respect to the Company and the
Subsidiaries as required by the Act and with respect to the financial and other
statistical and numerical information contained in the Registration Statement
and containing the information and statements of the type ordinarily included in
accountants' "comfort letters" to Underwriters with respect to the financial
statements and certain financial information contained in the Registration
Statement and the Prospectus.
At the First Closing Date, PricewaterhouseCoopers LLP shall have furnished
to the Underwriters a letter, dated the date of its delivery, which shall
confirm, on the basis of a review in accordance with the procedures set forth in
the letter from it, that nothing has come to its attention during the period
from the date of the letter referred to in the prior sentence to a date
(specified in the letter) not more than five days prior to the First Closing
Date which would require any change in its letter dated the date hereof if it
were required to be dated and delivered at the First Closing Date as the case
may be.
References to the Registration Statement and the Prospectus in this
paragraph (f) with respect to either letter referred to above shall include any
amendment or supplement thereto at the date of such letter.
(h) The Company and the Subsidiaries shall not have failed on or prior to
the First Closing Date to perform or comply with any of the agreements herein
contained and required to be performed or complied with by the Company on or
prior to the First Closing Date.
(i) The Representatives shall have received a certificate, dated the First
Closing Date, of Clay W. Hamlin, III and Roger A. Waesche, Jr., solely in their
capacities as the Chief Executive Officer and Chief Financial Officer of the
Company to the effect that:
(i) All the representations and warranties of the Company in this
Agreement shall be true and correct, in all material respects, on the First
Closing Date with the same force and effect as if made on and as of the
First Closing Date. The Company has complied with all agreements and all
conditions on its part to be performed or satisfied hereunder at or prior
to the First Closing Date.
(ii) The Registration Statement, including any Rule 462(b)
Registration Statement, has become effective under the Act; the Prospectus
or the Prospectus Supplement, as the case may be, shall have been filed
with the Commission pursuant to Rule 424(b) within the applicable time
period prescribed for such filing by such Rule and prior to the time the
Prospectus Supplement was distributed to any Underwriter; no stop order
suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto and no order directed at any document
incorporated by reference in the
29
Registration Statement or the Prospectus or any amendment or supplement
thereto has been issued, and no proceedings for that purpose have been
instituted or are pending before, or threatened or, to the best of the
Company's knowledge, after due inquiry, are contemplated by the Commission;
no stop order suspending the effectiveness of the Registration Statement or
any post-effective amendment thereto and no order directed at any document
incorporated by reference in the Registration Statement or the Prospectus
or any amendment or supplement thereto has been issued, and no proceedings
for that purpose have been instituted or are pending before, or threatened
or, to the best of the Company's knowledge, after due inquiry, are
contemplated by the state securities authority of any jurisdiction; and
(iii) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus other than as set
forth in or contemplated by the Registration Statement and the Prospectus
(exclusive of any amendments or supplements thereto subsequent to the date
of this Agreement) and prior to the First Closing Date, except for changes
of a general nature applicable to all real estate investment trusts, (i)
there has not occurred any material adverse change or, to the best
knowledge of such persons, any development involving a prospective material
adverse change in the condition, financial or otherwise, or the results of
operations, business, prospects, management or operations of the Company
and the Subsidiaries, taken as a whole, (ii) there has been no casualty
loss or condemnation or other adverse event with respect to any of the
properties which would be material to the Company or the Subsidiaries,
(iii) there has not been any material adverse change or any development
involving a prospective material adverse change in the capitalization,
long-term or short-term debt or in the shares of beneficial interest or
equity of the Company or any of the Subsidiaries, (iv) except as described
in the Prospectus, neither the Company nor any of the Subsidiaries has
incurred any material liability or obligation, direct or contingent, which
would be material, nor have they entered into any transactions, other than
pursuant to this Agreement and the transactions referred to herein or as
contemplated in the Prospectus, which would be material, to the Company and
its Subsidiaries taken as a whole, and (v) except for regular quarterly
distributions on the Offered Securities, the Company has not paid or
declared and will not pay or declare any dividends or other distributions
of any kind on any class of its shares of beneficial interest except in the
ordinary course of business consistent with such practice.
(j) On or before the First Closing Date, the Representatives and counsel
for the Underwriters shall have received such further certificates, letters,
documents, opinions or other information as they may have reasonably requested
from the Company for the purpose of enabling them to pass upon the issuance and
sale of the Offered Securities, as herein contemplated and related proceedings,
or in order to evidence the accuracy of any of the representations or
warranties, or the fulfillment of any of the conditions, herein contained; and
all proceedings taken by the Company in connection with the issuance and sale of
the Offered Securities as herein contemplated shall be reasonably satisfactory
in form and substance to the Representatives and counsel for the Underwriters.
30
(k) The Offered Securities shall have been approved for listing on the
NYSE, subject to official notice of issuance.
(l) The Company shall have duly filed the Articles Supplementary
designating the Preferred Shares with the SDAT.
The respective obligations of the several Underwriters to purchase and pay
for any Optional Securities shall be subject, in their discretion, to each of
the foregoing conditions to purchase the Firm Securities (except that all
references to the Firm Securities and the First Closing Date shall be deemed to
refer to such Optional Securities and the related Optional Closing Date,
respectively), including, without limitation:
(a) A certificate, dated such Optional Closing Date, of the President
or a Vice President and the chief financial or chief accounting officer of
the Company confirming that the certificates delivered at the First Closing
Date pursuant to Section 6 hereof remain true and correct in all material
respects as of such Optional Closing Date.
(b) An opinion of Morgan, Lewis & Bockius LLP in form and substance
satisfactory to you and your counsel, dated such Optional Closing Date,
relating to the Optional Securities to be purchased on such Optional
Closing Date and otherwise to the same effect as the opinion required by
Section 6(d) hereof.
(c) An opinion of John H. Gurley, Esq. in form and substance
satisfactory to you and your counsel, dated such Optional Closing Date,
relating to the Optional Securities to be purchased on such Optional
Closing Date and otherwise to the same effect as the opinion required by
Section 6(e) hereof.
(d) An opinion of Clifford Chance Rogers & Wells LLP, counsel for the
Underwriters, dated such Optional Closing Date, relating to the Optional
Securities to be purchased on such Optional Closing Date and otherwise to
the same effect as the opinion required by Section 6(f) hereof.
(e) A letter from PricewaterhouseCoopers LLP, in form and substance
satisfactory to you and your counsel and dated such Optional Closing Date,
substantially the same in form and substance as the letter furnished to the
Underwriters pursuant to Section 6(g) hereof, dated not more than five days
prior to such Optional Closing Date.
7. INDEMNIFICATION AND CONTRIBUTION. (a) The Company and the Operating
Partnership will indemnify and hold harmless each Underwriter, its partners,
directors and officers and each person, if any, who controls such Underwriter
within the meaning of Section 15 of the Act, against any losses, claims, damages
or liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary Prospectus, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
or arise out of any untrue statement or alleged untrue statement made by the
Company or the Operating Partnership in Section 2 of this Agreement, or arise
out of any untrue statement or alleged untrue statement of any material fact
contained in any application or other
31
document, or any amendment or supplement thereto, executed by the Company or the
Operating Partnership or based upon written information furnished by or on
behalf of the Company or the Operating Partnership filed in any jurisdiction in
order to qualify the Offered Securities under the securities or blue sky laws
thereof or filed with the Commission or any securities association or securities
exchange, or arise out of any untrue statement or alleged untrue statement of
any material fact contained in any audio or visual materials prepared by the
Company or the Operating Partnership or based upon written information furnished
by or on behalf of the Company or the Operating Partnership (including, without
limitation, slides, videos, films, tape recordings) used in connection with the
marketing of the Offered Securities, including, without limitation, statements
communicated to securities analysts employed by the Underwriters, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that the Company will not be liable in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and agreed
that the only such information furnished by any Underwriter consists of the
information described as such in subsection (b) below.
(b) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company, its directors and officers and each person, if any who
controls the Company within the meaning of Section 15 of the Act, against any
losses, claims, damages or liabilities to which the Company may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary Prospectus, or arise out of or are based
upon the omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information furnished to the
Company by such Underwriter through the Representatives specifically for use
therein, and will reimburse any legal or other expenses reasonably incurred by
the Company in connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred, it being understood
and agreed that the only such information furnished by any Underwriter consists
of the following information in the Prospectus furnished on behalf of each
Underwriter: the concession and reallowance figures appearing in the fourth
paragraph under the caption "Underwriting" and the information in the second and
third sentences of the eighth paragraph and the ninth and twelfth paragraphs
under the caption "Underwriting".
(c) Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above, except to the extent such omission so to
notify the indemnifying party materially prejudices the indemnifying party. In
case any such action is brought against any indemnified party and it notifies
the indemnifying party of the commencement thereof, the
32
indemnifying party will be entitled to participate therein and, to the extent
that it may wish, jointly with any other indemnifying party similarly notified,
to assume the defense thereof, with counsel satisfactory to such indemnified
party (who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and after notice from the indemnifying party
to such indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party unless such settlement (i) includes an unconditional release of such
indemnified party from all liability on any claims that are the subject matter
of such action and (ii) does not include a statement as to, or an admission of,
fault, culpability or a failure to act by or on behalf of an indemnified party.
(d) If the indemnification provided for in this Section is unavailable or
insufficient to hold harmless an indemnified party under subsection (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other from the offering of the Offered
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company bear to the total underwriting discounts and commissions received
by the Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to in
the first sentence of this subsection (d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Offered Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person found by a court to be guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not found by a court to be guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
33
(e) The obligations of the Company under this Section shall be in addition
to any liability which the Company may otherwise have and shall extend, upon the
same terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act; and the obligations of the Underwriters under
this Section shall be in addition to any liability which the respective
Underwriters may otherwise have and shall extend, upon the same terms and
conditions, to each director of the Company, to each officer of the Company who
has signed a Registration Statement and to each person, if any, who controls the
Company within the meaning of the Act.
8. DEFAULT OF UNDERWRITERS. If any Underwriter or Underwriters default in
their obligations to purchase Offered Securities hereunder on either the First
or any Optional Closing Date and the aggregate number of shares of Offered
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed 10% of the total number of shares of Offered Securities
that the Underwriters are obligated to purchase on such Closing Date, CSFBC may
make arrangements satisfactory to the Company for the purchase of such Offered
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by such Closing Date, the non-defaulting Underwriters
shall be obligated severally, in proportion to their respective commitments
hereunder, to purchase the Offered Securities that such defaulting Underwriters
agreed but failed to purchase on such Closing Date. If any Underwriter or
Underwriters so default and the aggregate number of shares of Offered Securities
with respect to which such default or defaults occur exceeds 10% of the total
number of shares of Offered Securities that the Underwriters are obligated to
purchase on such Closing Date and arrangements satisfactory to CSFBC and the
Company for the purchase of such Offered Securities by other persons are not
made within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Company, except
as provided in Section 9 (provided that if such default occurs with respect to
Optional Securities after the First Closing Date, this Agreement will not
terminate as to the Firm Securities or any Optional Securities purchased prior
to such termination). In the event of any default by one or more Underwriters as
described in this Section 8, the Representatives shall have the right to
postpone the First Closing Date or the Optional Closing Date, as the case may
be, established as provided in Section 3 hereof for not more than seven business
days in order that any necessary changes may be made in the arrangements or
documents for the purchase and delivery of the Firm Securities or Optional
Securities, as the case may be. As used in this Agreement, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability for
its default.
SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The
respective indemnities, agreements, representations, warranties
and other statements of the Company or its officers and of the
several Underwriters set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any
investigation, or statement as to the results thereof, made by or
on behalf of any Underwriter, the Company or any of their
respective representatives, officers or directors or any
controlling person, and will survive delivery of and payment for
the Offered Securities. If this Agreement is terminated pursuant
to Section 8 or if for any reason the purchase of the Offered
Securities by the Underwriters is not consummated, the Company
shall remain responsible for the expenses to be paid or
reimbursed by it pursuant to Section 5 and the respective
obligations of the Company and the Underwriters pursuant to
Section 7 shall remain in effect, and if any Offered Securities
have been
34
purchased hereunder the representations and warranties in Section
2 and all obligations under Section 5 shall also remain in
effect. If the purchase of the Offered Securities by the
Underwriters is not consummated for any reason other than solely
because of the termination of this Agreement pursuant to Section
8 or the occurrence of any event specified in clause (iii), (iv)
or (v) of Section 6(c), the Company will reimburse the
Underwriters for all out-of-pocket expenses (including fees and
disbursements of counsel) reasonably incurred by them in
connection with the offering of the Offered Securities.
9. NOTICES. All communications hereunder will be in writing and, if sent to
the Underwriters, will be mailed, delivered or telegraphed and confirmed to the
Representatives, c/o Credit Suisse First Boston Corporation, Eleven Madison
Avenue, New York, NY 10010-3629, Attention: Transactions Advisory Group, with a
copy to Clifford Chance Rogers & Wells LLP, 200 Park Avenue, New York, NY,
10166, Attention: Robert E. King, Jr., or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at Corporate Office
Properties Trust, 401 City Avenue, Suite 615, Bala Cynwyd, PA 19004-1126,
Attention: Clay W. Hamlin, III, with a copy to Morgan, Lewis & Bockius, LLP,
1701 Market Street, Philadelphia, PA 19103-2921, Attention: John F. Bales, III.;
provided, however, that any notice to an Underwriter pursuant to Section 7 will
be mailed, delivered or telegraphed and confirmed to such Underwriter.
10. SUCCESSORS. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Section 7, and no other person
will have any right or obligation hereunder.
11. REPRESENTATION OF UNDERWRITERS. The Representatives will act for the
several Underwriters in connection with this financing, and any action under
this Agreement taken by the Representatives jointly or by CSFBC will be binding
upon all the Underwriters.
12. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
13. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in The City of New York in any suit
or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby.
35
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
several Underwriters in accordance with its terms.
Very truly yours,
CORPORATE OFFICE PROPERTIES TRUST
By: /s/ Randall M. Griffin
-----------------------------------
Name: Randall M. Griffin
Title: President & COO
CORPORATE OFFICE PROPERTIES, L.P.
By: CORPORATE OFFICE PROPERTIES TRUST,
its sole general partner
By: /s/ Randall M. Griffin
--------------------------------
Name: Randall M. Griffin
Title: President & COO
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
A.G. EDWARDS & SONS, INC.
Acting on behalf of themselves and
as the Representatives of the
several Underwriters
By: CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ Eril A. Anderson
----------------------------------------
Name: Eril A. Anderson
Title: Managing Director
SCHEDULE I
UNDERWRITER NUMBER OF
FIRM SECURITIES
Credit Suisse First Boston Corporation......................... 125,000
A.G. Edwards & Sons, Inc....................................... 125,000
Deutsche Bank Alex. Brown...................................... 125,000
Legg Mason Wood Walker, Incorporated........................... 125,000
Prudential Securities Incorporated............................. 125,000
McDonald Investments Inc....................................... 125,000
Janney Montgomery Scott LLC.................................... 125,000
Tucker Anthony Incorporated.................................... 125,000
-----------
Total............................... 1,000,000
===========
2
SCHEDULE II
SUBSIDIARIES
NAME JURISDICTION OF INCORPORATION/FORMATION FOREIGN QUALIFICATION
LIMITED & GENERAL PARTNERSHIPS
Blue Bell Investment Company, L.P. Delaware PA
Corporate Office Properties, L.P. Delaware MD, NJ, PA
Corporate Gateway General Partnership PA
Comcourt Investors, L.P. Delaware PA
COPT Gateway, L.P. PA
Gateway Central Limited Partnership PA
South Brunswick Investors, L.P. Delaware NJ
6385 Flank Drive, L.P. PA
TA Associates, L.P. Maryland
CORPORATIONS
Corporate Office Management, Inc. Maryland NJ, DE, VA, PA
Corporate Office Properties Holdings, Inc. Delaware PA, NJ
COPT Acquisitions, Inc. Delaware PA, NJ, MD
LIMITED LIABILITY COMPANIES
Airport Square II, LLC Maryland
Delaware Airport III, LLC Delaware MD
Airport Square IV, LLC Maryland
Airport Square V, LLC Maryland
Airport Square VI and VII, LLC Delaware MD
Delaware Airport VIII, LLC Delaware MD
Delaware Airport IX, LLC Delaware MD
Airport Square X, LLC Maryland
Airport Square XI, LLC Maryland
Airport Square XIII, LLC Maryland
Airport Square XIV, LLC Maryland
Airport Square XV, LLC Maryland
Airport Square XIX, LLC Maryland
Airport Square XX, LLC Maryland
Airport Square XXI, LLC Maryland
Atrium Building, LLC Maryland
Brown's Wharf, LLC Maryland
Commons Office Research, LLC Maryland
Concourse 1304, LLC Maryland
COPT Columbia, LLC Maryland
3
COPT Concourse, LLC Delaware
COR, LLC Maryland
Corporate Development Services, LLC Maryland
Corporate Gatespring, LLC Maryland
Corporate Gatespring II, LLC Maryland
SCHEDULE II (CONT'D.)
SUBSIDIARIES
NAME JURISDICTION OF INCORPORATION/FORMATION FOREIGN QUALIFICATION
LIMITED LIABILITY COMPANIES (CONT.)
Corporate Management Services, LLC Maryland
Corporate Realty Management, LLC Maryland DC, VA, DE, PA, NJ
Corporate Realty Advisors, LLC Maryland
Cornucopia Holdings, LLC Maryland
Cornucopia Holdings II, LLC Maryland
CRM/Edgewood Property Services, LLC Maryland
Cuaba Associates, LLC New Jersey
Gateway 44, LLC Maryland
Honeyland 108, LLC Maryland
Lakeview at the Greens, LLC Maryland
Martin G. Knott & Associates, LLC Maryland
NBP One, LLC Maryland
NBP 131-133-141, LLC Maryland
NBP 132, LLC Maryland
NBP 134, LLC Maryland
NBP 135, LLC Maryland
NBP 201, LLC Maryland
NBP 221, LLC Maryland
NBP Retail, LLC Maryland
9690 Deereco Road, LLC Maryland
Princeton Executive, LLC New Jersey
7200 Riverwood, LLC Maryland
7318 Parkway Drive Enterprises, LLC Maryland
7321 Parkway Drive Enterprises, LLC Maryland
7240 Parkway Drive Enterprises, LLC Maryland
6711 Gateway, LLC Maryland
6731 Gateway, LLC Maryland
68 Culver, LLC New Jersey
St. Barnabas, LLC Maryland
Tech Park I, LLC Maryland
4
Tech Park II, LLC Maryland
Tech Park IV, LLC Maryland
Three Centre Park, LLC Maryland
5
SCHEDULE III
MATERIAL DOCUMENTS
Amended and Restated Registration Rights Agreement, dated March 16, 1998,
for the benefit of certain shareholders of the Company (filed with the Company's
Quarterly Report on Form 10-Q on August 12, 1998 and incorporated herein by
reference).
Amended and Restated Limited Partnership Agreement of the Operating
Partnership, dated March 16, 1998 (filed with the Company's Quarterly Report on
Form 10-Q on August 12, 1998 and incorporated herein by reference).
First Amendment to Amended and Restated Limited Partnership Agreement of
the Operating Partnership, dated September 28, 1998 (filed with the Company's
Current Report on Form 8-K on October 13, 1998 and incorporated herein by
reference).
Second Amendment to Amended and Restated Limited Partnership Agreement of
the Operating Partnership, dated October 13, 1998 (filed with the Company's
Current Report on Form 8-K on October 28, 1998 and incorporated herein by
reference).
Third Amendment to Amended and Restated Limited Partnership Agreement of
the Operating Partnership, dated December 31, 1998 (filed with the Company's
Current Report on Form 8-K on January 14, 1999 and incorporated herein by
reference).
Registration Rights Agreement, dated September 28, 1998, for the benefit of
certain shareholders of the Company.
Senior Secured Credit Agreement, dated October 13, 1997, (filed with the
Company's Current Report on Form 8-K on October 29, 1997, and incorporated
herein by reference).
Amended and Restated Senior Secured Credit Agreement, dated August 31,
1998, between the Company, the Operating Partnership, Any Mortgaged Property
Subsidiary and Bankers Trust Company as Agent.
Project Consulting and Management Agreement, dated September 28, 1998,
between Constellation Properties, Inc. and COMI (filed with the Company's
Current Report on Form 8-K on October 13, 1998 and incorporated herein by
reference).
Agreement for Services, dated September 28, 1998, between the Company and
Corporate Office Management, Inc.
Promissory Note dated October 22, 1998, in the amount of $ 85,000,000 made
by the Operating Partnership in favor of Teachers Insurance and Annuity
Association of America.
6
SCHEDULE IV
SUBSIDIARIES - MLB OPINION
Corporate Office Properties, L.P.
Corporate Office Management, Inc.
Corporate Realty Management, LLC
Corporate Development Services, LLC
Blue Bell Investment Company, L.P.
South Brunswick Investors, L.P.
7
SCHEDULE V
SUBSIDIARIES - GURLEY OPINION
NBP One, LLC
Airport Square II, LLC
Airport Square XX, LLC
NBP 131-133-141, LLC
NBP 135, LLC
7200 Riverwood, LLC
Corporate Gatespring, LLC
St. Barnabas, LLC
8