NEWCASTLE INVESTMENT CORP.
Common Stock, Warrants to Purchase Common Stock, Preferred Stock
and Depositary Shares
UNDERWRITING AGREEMENT
----------------------
October 27, 0000
XXXX XX XXXXXXX SECURITIES LLC
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Newcastle Investment Corp., a corporation organized and existing
under the laws of Maryland (the "Company"), proposes to issue and sell shares
of Common Stock, $.01 par value per share (the "Common Stock"), or warrants to
purchase a number of shares of Common Stock (the "Common Stock Warrants"), or
both, or shares of Preferred Stock, $.01 par value per share (the "Preferred
Shares"), from time to time, in one or more offerings on terms to be
determined at the time of sale. The Preferred Shares may be offered in the
form of depositary shares (the "Depositary Shares") represented by depositary
receipts (the "Depositary Receipts"). The Common Stock Warrants will be issued
pursuant to a Common Stock Warrant Agreement (the "Warrant Agreement") between
the Company and a warrant agent (the "Warrant Agent"). Each series of
Preferred Shares may vary as to the specific number of shares, title, stated
value, liquidation preference, issuance price, ranking, dividend rate or rates
(or method of calculation), dividend payment dates, any redemption or sinking
fund requirements, any conversion provisions and any other variable terms as
set forth in the applicable articles supplementary (each, the "Articles
Supplementary") relating to such Preferred Shares. As used herein,
"Securities" shall mean the Common Stock, the Common Stock Warrants, the
Preferred Shares, the Depositary Shares and the Depositary Receipts; and
"Warrant Securities" shall mean the Common Stock issuable upon exercise of
Common Stock Warrants. As used herein, "you" and "your," unless the context
otherwise requires, shall mean the parties to whom this Agreement is addressed
together with the other parties, if any, identified in the applicable Terms
Agreement (as hereinafter defined) as additional co-managers with respect to
Underwritten Securities (as hereinafter defined) purchased pursuant thereto.
Whenever the Company determines to make an offering of Securities
through you or through an underwriting syndicate managed by you, the Company
will enter into an agreement (the "Terms Agreement") providing for the sale of
such Securities (the "Underwritten Securities") to, and the purchase and
offering thereof by, you and such other underwriters, if any, selected by you
as have authorized you to enter into such Terms Agreement on their behalf (the
"Underwriters," which term shall include you whether acting alone in the sale
of the
Underwritten Securities or as a member of an underwriting syndicate and
any Underwriter substituted pursuant to Section 9 hereof). The Terms Agreement
relating to the offering of Underwritten Securities shall specify the number
of Underwritten Securities of each class or series to be initially issued,
including the number of Common Stock Warrants, if any (the "Initial
Underwritten Securities"), whether the Initial Underwritten Securities shall
be in the form of Depositary Shares and the fractional amount of Preferred
Shares represented by each Depositary Share, the names of the Underwriters
participating in such offering (subject to substitution as provided in Section
9 hereof), the number of Initial Underwritten Securities which each such
Underwriter severally agrees to purchase, the names of such of you or such
other Underwriters acting as co-managers, if any, in connection with such
offering, the price at which the Initial Underwritten Securities are to be
purchased by the Underwriters from the Company, any initial public offering
price, the time, date and place of delivery and payment, any delayed delivery
arrangements and any other variable terms of the Initial Underwritten
Securities (including, but not limited to, current ratings (in the case of
Preferred Shares and Depositary Shares only), designations, liquidation
preferences, conversion provisions, redemption provisions and sinking fund
requirements and the terms of the Warrant Securities and the terms, prices and
dates upon which such Warrant Securities may be purchased). In addition, each
Terms Agreement shall specify whether the Company has agreed to grant to the
Underwriters an option to purchase additional Underwritten Securities to cover
over-allotments, if any, and the number of Underwritten Securities subject to
such option (the "Option Securities"). As used herein, the term "Underwritten
Securities" shall include the Initial Underwritten Securities and all or any
portion of the Option Securities agreed to be purchased by the Underwriters as
provided herein, if any. The Terms Agreement, which shall be substantially in
the form of Exhibit A hereto, may take the form of an exchange of any standard
form of written communication between you and the Company. Each offering of
Underwritten Securities through you or through an underwriting syndicate
managed by you will be governed by this Agreement, as supplemented by the
applicable Terms Agreement.
The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (No. 333-109597),
including the related preliminary prospectus or prospectuses, for the
registration of up to $750,000,000 of the Securities and Warrant Securities
and debt securities of the Company, under the Securities Act of 1933, as
amended (the "1933 Act"), and pre-effective amendment no. 1 thereto, and the
offering thereof from time to time in accordance with Rule 415 of the rules
and regulations of the Commission under the 1933 Act (the "1933 Act
Regulations"). Such registration statement was declared effective by the
Commission on November 3, 2003. In connection with the execution and delivery
of the applicable Terms Agreement, the Company will prepare and file with the
Commission a prospectus supplement relating to the Underwritten Securities in
accordance with the provisions of Rule 430B ("Rule 430B") of the 1933 Act
Regulations and paragraph (b) of Rule 424 ("Rule 424(b)") (without reliance on
Rule 424(b)(8)) of the 1933 Act Regulations. Any information included in such
prospectus supplement that was omitted from such registration statement at the
time it became effective but that is deemed to be part of and included in such
registration statement pursuant to Rule 430B is referred to as "Rule 430B
Information." Each prospectus used in connection with the offering of the
Underwritten Securities omitting Rule 430B Information is herein called a
"preliminary prospectus." Such registration statement, at each time of
effectiveness under the 1933 Act and the 1933 Act Regulations prior to the
execution of the applicable Terms Agreement, including the amendments thereto
to such time,
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the exhibits and any schedules thereto at such time, the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the
1933 Act at such time and the documents otherwise deemed to be a part thereof
or included or incorporated therein by the 1933 Act Regulations, is herein
called the "Registration Statement"; provided, however, that the term
"Registration Statement" shall be deemed to include information contained in
the final prospectus supplement relating to the Underwritten Securities that
is retroactively deemed to be a part of such registration statement (as
amended) as of the time specified in Rule 430B of the 1933 Act Regulations.
The prospectus included in the Registration Statement, as supplemented by the
final prospectus supplement relating to the Underwritten Securities in the
form first furnished or made available to the Underwriters for use in
connection with an offering of the Underwritten Securities, including the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the 1933 Act at the time of the execution of the applicable Terms
Agreement, is herein called the "Prospectus." All references in this Agreement
to financial statements and schedules and other information which is
"contained," "included" or "stated" in the Registration Statement, any
preliminary prospectus or the Prospectus (and all other references of like
import) shall be deemed to mean and include all such financial statements and
schedules and other information which is or is deemed to be incorporated by
reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of 1934, as amended (the "1934
Act"), which is or is deemed to be incorporated by reference in the
Registration Statement, any preliminary prospectus or the Prospectus, as the
case may be, after the most recent effective date prior to the execution of
the applicable Terms Agreement, in the case of the Registration Statement, or
the respective issue dates in the case of the Prospectus and any preliminary
prospectus. If the Company files a registration statement to register a
portion of the Securities and Warrant Securities and relies on Rule 462(b) for
such registration statement to become effective upon filing with the
Commission (the "Rule 462 Registration Statement"), then any reference to
"Registration Statement" herein shall be deemed to be to both the registration
statement referred to above (No. 333-109597) and the Rule 462 Registration
Statement, as each such registration statement may be amended pursuant to the
1933 Act. All references in this Agreement to the Registration Statement, the
Rule 462(b) Registration Statement, any preliminary prospectus or the
Prospectus, or any amendments or supplements to any of the foregoing, shall be
deemed to include any copy thereof filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval System ("XXXXX").
The Company and Fortress Investment Group LLC, a limited liability
company organized and existing under the laws of Delaware and the manager of
the Company (the "Manager"), each confirms as follows its agreements with you.
1. Representations and Warranties.
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(a) Representations and Warranties of the Company. The Company
represents and warrants to you, as of the date hereof, and to you and each
Underwriter named in the applicable Terms Agreement, as of the date thereof,
the Applicable Time (as hereinafter defined), the Closing Time (as hereinafter
defined) and each Date of Delivery, if any (as hereinafter defined) (in each
case, a "Representation Date"), as follows:
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(i) The Company meets the requirements for use of Form S-3
under the 1933 Act. The Registration Statement has become effective under the
1933 Act and no stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to the
knowledge of the Company, are contemplated by the Commission or by the state
securities authority of any jurisdiction, and any request on the part of the
Commission for additional information has been complied with.
At the respective times the Registration Statement and any
post-effective amendments thereto became effective and at each deemed
effective date with respect to the Underwriters pursuant to Rule 430B(f)(2) of
the 1933 Act Regulations, the Registration Statement and any amendments and
supplements thereto complied, complies and will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act Regulations,
and did not, does not and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading. Neither the
Prospectus nor any amendments or supplements thereto, at the time the
Prospectus or any such amendment or supplement was first used, at the Closing
Time and at any Date of Delivery included, includes or will include an untrue
statement of a material fact or omitted, omits or will omit to state a
material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
Any preliminary prospectus (including the prospectus filed as part of
the Registration Statement or any amendment thereto) complied when filed with
the Commission in all material respects with the 1933 Act and the 1933 Act
Regulations and any such preliminary prospectus and the Prospectus delivered
or made available to the Underwriters for use in connection with the offering
of Underwritten Securities was and will, at the time of such delivery, be
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except to the extent permitted by Regulation
S-T.
As of the Applicable Time, any Issuer Free Writing Prospectus (as
defined below) issued at or prior to the Applicable Time, the Statutory
Prospectus (as defined below) and the information included on Schedule II to
the applicable Terms Agreement, all considered together (collectively, the
"General Disclosure Package"), did not include any untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading.
The representations and warranties in the preceding three paragraphs
shall not apply to statements in or omissions from the Registration Statement
or any post-effective amendment thereto or the Prospectus or any amendments or
supplements thereto, or the General Disclosure Package, made in reliance upon
and in conformity with information furnished to the Company in writing by or
on behalf of any Underwriter through you expressly for use in the Registration
Statement or any post-effective amendment thereto, or the Prospectus, or any
amendments or supplements thereto, or the General Disclosure Package.
As used in this subsection and elsewhere in this Agreement:
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"Applicable Time" shall have the meaning set forth in the applicable
Terms Agreement with respect to the Underwritten Securities specified therein.
"Issuer Free Writing Prospectus" means any "issuer free writing
prospectus," as defined in Rule 433 of the 1933 Act Regulations ("Rule 433"),
relating to any particular issuance of Underwritten Securities (including any
identified on Schedule I to the applicable Terms Agreement) that (i) is
required to be filed with the Commission by the Company, (ii) is a "road show
that is a written communication" within the meaning of Rule 433(d)(8)(i),
whether or not required to be filed with the Commission or (iii) is exempt
from filing pursuant to Rule 433(d)(5)(i) because it contains a description of
the Underwritten Securities or of the offering that does not reflect the final
terms, in each case in the form filed or required to be filed with the
Commission or, if not required to be filed, in the form retained in the
Company's records pursuant to Rule 433(g).
"Statutory Prospectus" as of any time means the prospectus that is
included in the Registration Statement immediately prior to that time and the
preliminary prospectus supplement relating to a particular issuance of
Underwritten Securities set forth in the applicable Terms Agreement, including
the documents incorporated by reference therein and any preliminary or other
prospectus deemed to be a part thereof.
(ii) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement and the Prospectus, at the time they
were or hereafter are filed with the Commission, complied and will comply in
all material respects with the requirements of the 1934 Act and the rules and
regulations of the Commission under the 1934 Act (the "1934 Act Regulations"),
and, when read together with the other information in the Prospectus, (a) at
the time the Registration Statement became effective, (b) at the earlier of
the time the Prospectus was first used and the date and time of the first
contract of sale of the Securities in this offering and (c) as of the
applicable Representation Date or during the period specified in Section
3(a)(vi), did not and will not include an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(iii) As of the date of the execution and delivery of the
applicable Terms Agreement (with such date being used as the determination
date for purposes of this clause), the Company was not and is not an
Ineligible Issuer (as defined in Rule 405 of the 1933 Act Regulations),
without taking account of any determination by the Commission pursuant to Rule
405 of the 1933 Act Regulations that it is not necessary that the Company be
considered an Ineligible Issuer.
(iv) Each Issuer Free Writing Prospectus identified on Schedule
I to the applicable Terms Agreement, as of its date of first use and at all
subsequent times through the completion of the public offer and sale of the
Underwritten Securities or until any earlier date that the Company notified or
notifies the Underwriters as described in Section 3(a)(vi), did not, does not
and will not include any information that conflicted, conflicts or will
conflict with the information contained in the Registration Statement or the
Prospectus, including any document incorporated by reference therein and any
preliminary or other prospectus deemed to be a part thereof that has not been
superseded or modified. The foregoing sentence does not apply to
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statements in or omissions from any such Issuer Free Writing Prospectus based
upon and in conformity with written information furnished to the Company by or
on behalf of any Underwriter through you specifically for use therein.
(v) Ernst & Young LLP, the accountants who have certified the
financial statements included or incorporated by reference in the Registration
Statement, the General Disclosure Package and the Prospectus, are independent
registered public accountants as required by the 1933 Act, the 1933 Act
Regulations and the Public Company Accounting Oversight Board (United States).
(vi) Subsequent to the respective dates as of which information
is given in the Registration Statement, the General Disclosure Package and the
Prospectus (excluding any documents incorporated therein by reference pursuant
to the 1934 Act after the execution of the applicable Terms Agreement), except
as set forth in the Registration Statement, the General Disclosure Package and
the Prospectus, there has been no material adverse change or any development
involving a prospective material adverse change in the business, properties,
operations, condition (financial or other) or results of operations of the
Company and its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business and since the date of the
latest balance sheet presented or incorporated by reference in the
Registration Statement, the General Disclosure Package and the Prospectus,
neither the Company nor any of its subsidiaries has incurred or undertaken any
liabilities or obligations, direct or contingent, which are material to the
Company and its subsidiaries taken as a whole, except for liabilities or
obligations which are reflected in or incorporated by reference in the
Registration Statement, the General Disclosure Package and the Prospectus
(excluding any documents incorporated therein by reference pursuant to the
1934 Act after the execution of the applicable Terms Agreement).
(vii) The Underwritten Securities being sold pursuant to the
applicable Terms Agreement and, if applicable, the deposit of the Preferred
Shares in accordance with the provisions of a Deposit Agreement (each, a
"Deposit Agreement"), among the Company, the financial institution named in
the Deposit Agreement (the "Depositary") and the holders of the Depositary
Receipts issued thereunder, have, as of each Representation Date, been duly
authorized by the Company and such Underwritten Securities have been duly
authorized for issuance and sale pursuant to this Agreement and such
Underwritten Securities, when issued and delivered by the Company pursuant to
this Agreement against payment of the consideration set forth in the
applicable Terms Agreement or any Delayed Delivery Contract (as hereinafter
defined), will be validly issued, fully paid and non-assessable and will not
be subject to preemptive or other similar rights; the Preferred Shares, if
applicable, conform to the provisions of the Articles Supplementary; and the
Underwritten Securities being sold pursuant to the applicable Terms Agreement
conform in all material respects to all statements relating thereto contained
in the General Disclosure Package and the Prospectus.
(viii) If applicable, the Common Stock Warrants have been duly
authorized and, when issued and delivered pursuant to this Agreement and
countersigned by the Warrant Agent as provided in the Warrant Agreement, will
have been duly executed, countersigned, issued and delivered and will
constitute valid and legally binding obligations of the Company entitled to
the benefits provided by the Warrant Agreement under which they are to be
issued; the issuance of
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the Warrant Securities upon exercise of the Common Stock Warrants will not be
subject to preemptive or other similar rights; and the Common Stock Warrants
conform in all material respects to all statements relating thereto contained
in the General Disclosure Package and the Prospectus.
(ix) If applicable, the shares of Common Stock issuable upon
conversion of any of the Preferred Shares or the Depositary Shares, or the
Warrant Securities, will have been duly and validly authorized and reserved
for issuance upon such conversion or exercise by all necessary corporate
action and such shares, when issued upon such conversion or exercise, will be
duly and validly issued and will be fully paid and non-assessable, and the
issuance of such shares upon such conversion or exercise will not be subject
to preemptive or other similar rights; the shares of Common Stock issuable
upon conversion of any of the Preferred Shares or the Depositary Shares, or
the Warrant Securities, conform in all material respects to the descriptions
thereof in the General Disclosure Package and the Prospectus.
(x) The applicable Warrant Agreement, if any, and the
applicable Deposit Agreement, if any, will have been duly authorized, executed
and delivered by the Company prior to the issuance of any applicable
Underwritten Securities, and each constitutes a valid and legally binding
agreement of the Company enforceable in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency or other similar
laws relating to or affecting creditors' rights generally and by general
equity principles (regardless of whether enforcement is considered in a
proceeding in equity or at law); and the Warrant Agreement, if any, and the
Deposit Agreement, if any, each conforms in all material respects to all
statements relating thereto contained in the General Disclosure Package and
the Prospectus.
(xi) If applicable, upon execution and delivery of the
Depositary Receipts pursuant to the terms of the Deposit Agreement, the
persons in whose names such Depositary Receipts are registered will be
entitled to the rights specified therein and in the Deposit Agreement, except
as enforcement of such rights may be limited by bankruptcy, insolvency or
other similar laws relating to or affecting creditors' rights generally and by
general equity principles (regardless of whether enforcement is considered in
a proceeding in equity or at law).
(xii) The amended and restated management and advisory
agreement (the "Management Agreement"), dated as of June 23, 2003, between the
Company and the Manager has been duly authorized, executed and delivered by
the Company and constitutes a valid and binding agreement of the Company
enforceable in accordance with its terms, except to the extent that
enforcement thereof may be limited by bankruptcy, insolvency, reorganization
or other laws affecting enforcement of creditors' rights or by general
equitable principles.
(xiii) The execution, delivery, and performance of this
Agreement, the applicable Terms Agreement, any Warrant Agreement or any
Deposit Agreement and the consummation of the transactions contemplated hereby
and thereby do not and will not (i) conflict with or result in a breach of any
of the terms and provisions of, or constitute a default (or an event which
with notice or lapse of time, or both, would constitute a default) under, or
result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its subsidiaries pursuant to,
any indenture, mortgage, deed of trust, loan agreement or other agreement,
instrument, franchise, license or permit to which the Company or
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any of its subsidiaries is a party or by which the Company or any of its
subsidiaries or their respective properties or assets may be bound and which
is material to the business of the Company and its subsidiaries taken as a
whole or (ii) violate or conflict with any provision of the charter, by-laws,
limited liability company agreement or partnership agreement, as the case may
be, of the Company or any of the subsidiaries listed on Schedule I hereto (the
"Subsidiaries") or any judgment, decree, order, statute, rule or regulation of
any court or any public, governmental or regulatory agency or body having
jurisdiction over the Company or any of the Subsidiaries or any of their
respective properties or assets. The Company has no other significant
subsidiaries (as such term is defined in Rule 1-02 of Regulation S-X) that are
not set forth on Schedule I hereto. No consent, approval, authorization,
order, registration, filing, qualification, license or permit of or with any
court or any public, governmental or regulatory agency or body having
jurisdiction over the Company or any of the Subsidiaries or any of their
respective properties or assets is required for the execution, delivery and
performance of this Agreement, the applicable Terms Agreement, any Warrant
Agreement or any Deposit Agreement, or the consummation of the transactions
contemplated hereby or thereby, by the Registration Statement, the General
Disclosure Package and the Prospectus, including the issuance, sale and
delivery of the Underwritten Securities to be issued, sold and delivered by
the Company pursuant to the applicable Terms Agreement, any Warrant Agreement
or any Deposit Agreement, except the registration under the 1933 Act of the
Underwritten Securities and such consents, approvals, authorizations, orders,
registrations, filings, qualifications, licenses and permits as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Underwritten Securities by you.
(xiv) The authorized, issued and outstanding stock of the
Company is as set forth in the Statutory Prospectus and the Prospectus under
"Capitalization" or in the latest balance sheet incorporated by reference
therein (except for subsequent issuances, if any, pursuant to reservations,
agreements, employee benefit plans, dividend reinvestment plans, employee and
director stock option plans or the exercise of convertible securities referred
to in the Registration Statement, the General Disclosure Package and the
Prospectus), and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued, are fully paid and non-assessable
and were not issued in violation of or subject to any preemptive or similar
rights that entitle or will entitle any person to acquire any Underwritten
Securities from the Company upon issuance thereof by the Company, except for
such rights as may have been fully satisfied or waived prior to the
effectiveness of the Registration Statement.
(xv) The Company and each of the Company's subsidiaries has
been duly organized and is validly existing as a corporation, partnership,
limited liability company or real estate investment trust in good standing
under the laws of its respective jurisdiction of organization. Each of the
Company and its subsidiaries is duly qualified to do business and is in good
standing as a foreign corporation, partnership, limited liability company or
real estate investment trust in each jurisdiction in which the character or
location of its properties (owned, leased or licensed) or the nature or
conduct of its business makes such qualification necessary, except for those
failures to be so qualified or in good standing which will not in the
aggregate have a material adverse effect on the condition (financial or
otherwise), results of operations, business or properties of the Company and
its subsidiaries taken as a whole (a "Material Adverse Effect"). Each of the
Company and its subsidiaries has all requisite power and authority, and all
necessary consents, approvals, authorizations, orders, registrations,
qualifications, licenses and
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permits of and from all public, regulatory or governmental agencies and bodies
(collectively, "Governmental Licenses"), to own, lease and operate their
respective properties and conduct their respective businesses as are now being
conducted and as described in the Registration Statement, the General
Disclosure Package and the Prospectus, except where the failure to possess any
such Governmental Licenses would not in the aggregate have a Material Adverse
Effect; and no such consent, approval, authorization, order, registration,
qualification, license or permit contains a materially burdensome restriction
not adequately disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus.
(xvi) Except as described in the Registration Statement, the
General Disclosure Package and the Prospectus, there is no legal or
governmental proceeding to which the Company or any of its subsidiaries is a
party, or any property of the Company or any of its subsidiaries is the
subject which, singularly or in the aggregate, if determined adversely to the
Company or any of its subsidiaries, are reasonably likely to have a Material
Adverse Effect, and to the best of the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened or contemplated by others.
(xvii) Neither the Company nor any of its affiliates have taken
nor will take, directly or indirectly, any action designed to cause or result
in, or which constitutes or which might reasonably be expected to constitute,
the stabilization or manipulation of the price of the shares of Common Stock
to facilitate the sale or resale of the Underwritten Securities.
(xviii) The financial statements, including the notes thereto,
and supporting schedules included or incorporated by reference in the
Registration Statement, the General Disclosure Package and the Prospectus
present fairly the financial position of the Company and its consolidated
subsidiaries as of the dates indicated and condition and results of operations
for the periods specified; except as otherwise stated in the Registration
Statement, the General Disclosure Package and the Prospectus, said financial
statements have been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods involved; and
the financial statements, including the notes thereto, and supporting
schedules included or incorporated by reference in the Registration Statement,
the General Disclosure Package and the Prospectus present fairly the
information required to be stated therein.
(xix) The pro forma financial statements, including the notes
thereto, included or incorporated by reference in the Registration Statement,
the General Disclosure Package and the Prospectus have been prepared in
accordance with the applicable requirements of the 1933 Act and the 1933 Act
Regulations with respect to pro forma financial statements and include all
adjustments necessary to present fairly the pro forma financial position of
the Company at the respective dates indicated and the results of operations
for the respective periods specified. The assumptions used in preparing the
pro forma financial statements provide a reasonable basis for presenting the
significant effects directly attributable to the transactions or events
described therein, the related pro forma adjustments give appropriate effect
to those assumptions, and the pro forma columns therein reflect the proper
application of those adjustments to the corresponding historical financial
statement amounts. All historical financial statements and information and all
pro forma financial statements and information required by the 1933 Act, the
1933 Act Regulations, the 1934 Act and the 1934 Act Regulations are included,
or incorporated
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by reference, in the Registration Statement, the General Disclosure Package
and the Prospectus. All disclosures contained in the Registration Statement,
the General Disclosure Package or the Prospectus, if any, regarding "non-GAAP
financial measures" (as such term is defined by the rules and regulations of
the Commission) comply with Regulation G under the 1934 Act and Item 10 of
Regulation S-K of the 1933 Act Regulations, to the extent applicable.
(xx) No relationship, direct or indirect, exists between or
among any of the Company or any affiliate of the Company, on the one hand, and
any director, officer, stockholder, customer or supplier of the Company or any
affiliate of the Company, on the other hand, which is required by the 1933
Act, the 1934 Act, the 1933 Act Regulations and the 1934 Act Regulations to be
described in the Registration Statement, the General Disclosure Package or the
Prospectus which is not so described or is not described as required. There
are no outstanding loans, advances (except normal advances for business
expenses in the ordinary course of business) or guarantees of indebtedness by
the Company to or for the benefit of any of the officers or directors of the
Company or any of their respective family members, except as disclosed or
incorporated by reference in the Registration Statement, the General
Disclosure Package and the Prospectus.
(xxi) The Company and its Subsidiaries maintain a system of
internal accounting and other controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with management's
general or specific authorizations, (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain accountability for
assets, (iii) access to assets is permitted only in accordance with
management's general or specific authorization, and (iv) the recorded
accounting for assets is compared with existing assets at reasonable intervals
and appropriate action is taken with respect to any differences.
(xxii) No holder of securities of the Company has any rights to
the registration of securities of the Company because of the filing of the
Registration Statement or otherwise in connection with the sale of the
Underwritten Securities contemplated in the applicable Terms Agreement.
(xxiii) The Company is not, and upon consummation of the
transactions contemplated in this Agreement, the applicable Terms Agreement
and in the Prospectus will not be, an "investment company" as such term is
defined in the Investment Company Act of 1940, as amended (the "Investment
Company Act").
(xxiv) (A) The Company and its subsidiaries have good and
marketable fee simple title or leasehold title, as the case may be, to all
real property owned or leased, as applicable, by the Company or any
subsidiary, and good title to all other properties owned by them
(collectively, the "Properties"), and any improvements thereon and all other
assets that are required for the operation of such properties in the manner in
which they currently are operated, free and clear of all liens, encumbrances,
claims, security interests and defects, except such as are Permitted
Encumbrances (as hereinafter defined); (B) all liens, charges, encumbrances,
claims or restrictions on or affecting any of the Properties and the assets of
any of the Company or its subsidiaries that are required to be disclosed in
the Registration Statement, the General Disclosure Package or the Prospectus
are disclosed therein; (C) each of the Properties complies
10
with all applicable codes, laws and regulations (including, without
limitation, building and zoning codes, laws and regulations and laws relating
to access to the Properties), except if and to the extent disclosed in the
Registration Statement, the General Disclosure Package and the Prospectus and
except for such failures to comply that would not in the aggregate have a
Material Adverse Effect; (D) there are in effect for the Properties and the
assets of each of the Company and its subsidiaries insurance policies covering
the risks and in amounts that are commercially reasonable for the Properties
and the types of assets owned by the Company and its subsidiaries and that are
consistent with the types and amounts of insurance typically maintained by
prudent owners of properties similar to such assets in the markets in which
such assets are located, and neither the Company nor any of its subsidiaries
has received from any insurance company notice of any material defects or
deficiencies affecting the insurability of any such assets or any notices of
cancellation or intent to cancel any such policies; and (E) neither the
Company nor any of its subsidiaries has knowledge of any pending or threatened
litigation, moratorium, condemnation proceedings, zoning change, or other
similar proceeding or action that could in any manner affect the size of, use
of, improvements on, construction on, access to or availability of utilities
or other necessary services to the Properties, except such proceedings or
actions that would not have a Material Adverse Effect. All of the leases and
subleases material to the business of the Company and its subsidiaries
considered as one enterprise, and under which the Company or any of its
subsidiaries holds the Properties, are in full force and effect, and neither
the Company nor any of its subsidiaries has received any notice of any
material claim of any sort that has been asserted by anyone adverse to the
rights of the Company or any of its subsidiaries under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the
Company or any of its subsidiaries of the continued possession of the leased
or subleased premises under any such lease or sublease. "Permitted
Encumbrance" shall mean (a) liens on Properties securing any of the Company or
any subsidiaries obligations, (b) other liens which are expressly described in
the Registration Statement, the General Disclosure Package and the Prospectus
and (c) customary easements and encumbrances and other exceptions to title
which do not materially impair the operation, development or use of the
Properties for the purposes intended therefor as contemplated in the
Registration Statement, the General Disclosure Package and the Prospectus.
(xxv) Except as disclosed in the Registration Statement, the
General Disclosure Package and the Prospectus or as would not have a Material
Adverse Effect: (A) each Property, including, without limitation, the
Environment (as defined below) associated with such Property, is free of any
Hazardous Substance (as hereinafter defined) in violation of any Environmental
Law (as defined below) applicable to such Property, except for Hazardous
Substances that would not result in a Material Adverse Effect; (B) neither the
Company nor any of its subsidiaries has during the period of its ownership
caused or suffered to occur any Release (as defined below) of any Hazardous
Substance into the Environment on, in, under or from any Property in violation
of any Environmental Law applicable to such Property, and no condition exists
on, in, under or, to the knowledge of the Company or any of its subsidiaries
adjacent to, any Property that could result in the incurrence of material
liabilities or any material violations of any Environmental Law applicable to
such Property, or give rise to the imposition of any Lien (as hereinafter
defined) under any Environmental Law; (C) neither the Company nor any of its
subsidiaries is engaged in any manufacturing at the Properties that (1)
requires the use, handling, transportation, storage, treatment or disposal of
any Hazardous Substance (other than cleaning solvents and similar materials
and other than insecticides and herbicides that are used in the ordinary
course
11
of operating the Properties and in compliance with all applicable
Environmental Laws) or (2) requires permits or is otherwise regulated pursuant
to any Environmental Law; (D) neither the Company nor any of its subsidiaries
has received any notice of a claim under or pursuant to any Environmental Law
applicable to a Property or under common law pertaining to Hazardous
Substances on or originating from any Property; (E) neither the Company nor
any of its subsidiaries has received any notice from any Governmental
Authority (as hereinafter defined) claiming any violation of any Environmental
Law that is uncured or unremediated as of the date hereof; and (F) no Property
is included or, to the knowledge of the Company or any of its subsidiaries,
proposed for inclusion on the National Priorities List issued pursuant to
CERCLA (as hereinafter defined) by the United States Environmental Protection
Agency (the "EPA") or on the Comprehensive Environmental Response,
Compensation, and Liability Information System database maintained by the EPA,
and has not otherwise been identified by the EPA as a potential CERCLA
removal, remedial or response site or included or, to the knowledge of the
Company or any of its subsidiaries, proposed for inclusion on, any similar
list of potentially contaminated sites pursuant to any other applicable
Environmental Law nor has the Company or any of its subsidiaries received any
written notice from the EPA or any other Governmental Authority proposing the
inclusion of any Property on such list; and (G) there are no underground
storage tanks located on or in any Property which have not been disclosed to
the Underwriters.
As used herein, the term "Hazardous Substance" shall include, without
limitation, any hazardous substance, hazardous waste, toxic or dangerous
substance, pollutant, solid waste or similarly designated materials,
including, without limitation, oil, petroleum or any petroleum-derived
substance or waste, asbestos or asbestos-containing materials, PCBs,
pesticides, explosives, radioactive materials, dioxins, urea formaldehyde
insulation or any constituent of any such substance, pollutant or waste,
including any such substance, pollutant or waste identified or regulated under
any Environmental Law (including, without limitation, materials listed in the
United States Department of Transportation Optional Hazardous Material Table,
49 C.F.R. ss. 172.101, as heretofore amended, or in the EPA's List of
Hazardous Substances and Reportable Quantities, 40 C.F.R. Part 302, as
heretofore amended); "Environment" shall mean any surface water, drinking
water, ground water, land surface, subsurface strata, river sediment,
buildings, structures, and ambient workplace and indoor air; "Environmental
Law" shall mean the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended (42 U.S.C. 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, orders, decisions and permits relating to the protection
of the environment or of human health from environmental effects;
"Governmental Authority" shall mean any federal, state or local governmental
office, agency or authority having the duty or authority to promulgate,
implement or enforce any Environmental Law; "Lien" shall mean, with respect to
any Property, any mortgage, deed of trust, pledge, security interest, lien,
encumbrance, penalty, fine, charge, assessment, judgment or other liability
in, on or affecting such Property; and "Release" shall mean any spilling,
leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, dumping, emanating or disposing of any Hazardous Substance
into the Environment, including, without limitation, the
12
abandonment or discard of barrels, containers, tanks (including, without
limitation, underground storage tanks) or other receptacles containing or
previously containing any Hazardous Substance or any release, emission,
discharge or similar term, as those terms are defined or used in any
Environmental Law.
(xxvi) The Company and each of its subsidiaries have accurately
prepared and timely filed all federal, state and other tax returns that are
required to be filed by it and have paid or made provision for the payment of
all taxes, assessments, governmental or other similar charges, including
without limitation, all sales and use taxes and all taxes which such entity is
obligated to withhold from amounts owing to employees, creditors and third
parties, with respect to the periods covered by such tax returns (whether or
not such amounts are shown as due on any tax return), except, in all cases,
for any such amounts that the Company is contesting in good faith and except
in any case in which the failure to so file or pay would not in the aggregate
have a Material Adverse Effect. No deficiency assessment with respect to a
proposed adjustment of the Company's or any of its subsidiaries' federal,
state, or other taxes is pending or, to the best of the Company's knowledge,
threatened which could reasonably be expected in the aggregate to have a
Material Adverse Effect. There is no tax lien, whether imposed by any federal,
state, or other taxing authority, outstanding against the assets, properties
or business of the Company or any of its subsidiaries, other than tax liens
for taxes not yet due.
(xxvii) There are no contracts or other documents which are
required to be described in the Registration Statement, the General Disclosure
Package or the Prospectus or to be filed as exhibits thereto which have not
been so described and filed as required.
(xxviii) Neither the Company nor any of its subsidiaries (i) is
in violation of its charter, by-laws, limited liability company agreement,
certificate of limited partnership or partnership agreement, as the case may
be, (ii) is in default under, and no event has occurred which, with notice or
lapse of time or both, would constitute such a default, or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of their
properties or assets is subject or (iii) is in violation in any respect of any
statute or any judgment, decree, order, rule or regulation of any court or
governmental or regulatory agency or body having jurisdiction over the Company
or any of its subsidiaries or any of their properties or assets, except in the
case of (ii) or (iii) above any violation or default that would not have a
Material Adverse Effect.
(xxix) The Company and each of its subsidiaries own or possess
adequate right to use all trademarks, service marks, trade names, trademark
registrations, service xxxx registrations, copyrights, licenses, know-how and
other intellectual property (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems or
procedures) necessary for the conduct of their respective businesses as being
conducted and as described in the Registration Statement, the General
Disclosure Package and the Prospectus, except where the failure to own or
possess such right would not in the aggregate have a Material Adverse Effect,
and have no reason to believe that the conduct of their respective businesses
will conflict with, and have not received any notice of any claim of conflict
with, any such right of
13
others which claim, if the subject of an unfavorable decision, ruling or
judgment, could in the aggregate reasonably be expected to result in a
Material Adverse Effect.
(xxx) No labor disturbance by the employees of the Company, the
Manager or any of their respective subsidiaries exists or, to the best of the
Company's knowledge, is imminent which might be expected to have a Material
Adverse Effect.
(xxxi) The Company does not have, and does not anticipate
incurring any liabilities under, the Employee Retirement Income Security Act
of 1974, as amended, or Section 4975 of the Internal Revenue Code of 1986, as
amended from time to time (the "Code").
(xxxii) The statistical and market-related data included or
incorporated by reference in the Registration Statement and the Prospectus are
based on or derived from sources which the Company believes to be reliable and
accurate.
(xxxiii) Commencing with its taxable year ended December 31,
2002, the Company has been and, upon the sale of the Underwritten Securities
pursuant to the applicable Terms Agreement, the Company will continue to be
organized and operated in conformity with, the requirements for qualification
and taxation as a real estate investment trust (a "REIT") under the Code, and
the Company's proposed method of operation as described in the General
Disclosure Package and the Prospectus will enable it to continue to meet the
requirements for qualification and taxation as a REIT under the Code, and no
actions have been taken (or not taken which are required to be taken) which
would cause such qualification to be lost.
(xxxiv) The Company is in compliance with applicable provisions
of the Xxxxxxxx-Xxxxx Act.
(xxxv) The Company has established and maintains "disclosure
controls and procedures" (as defined in Rules 13a-15(e) and 15d-15(e) under
the 1934 Act); the Company's "disclosure controls and procedures" are
reasonably designed to ensure that all information (both financial and
non-financial) required to be disclosed by the Company in the reports that it
files or submits under the 1934 Act is recorded, processed, summarized and
reported within the time periods specified in the 1934 Act Regulations, and
that all such information is accumulated and communicated to the Company's
management as appropriate to allow timely decisions regarding required
disclosure and to make the certifications of the Chief Executive Officer and
Chief Financial Officer of the Company required under the 1934 Act with
respect to such reports.
(xxxvi) Since the date of the filing of the Company's Annual
Report on Form 10-K for the year ended December 31, 2005, the Company's
auditors and the audit committee of the Board of Directors of the Company (or
persons fulfilling the equivalent function) have not been advised of (i) any
significant deficiencies in the design or operation of internal controls which
could adversely affect the Company's ability to record, process, summarize and
report financial data nor any material weaknesses in internal controls; (ii)
any fraud, whether or not material, that involves management or other
employees who have a significant role in the Company's internal controls.
(xxxvii) Since the date of the filing of the Company's Annual
Report on Form 10-K for the year ended December 31, 2005, there have been no
significant changes in internal
14
controls or in other factors that could significantly affect internal
controls, including any corrective actions with regard to significant
deficiencies and material weaknesses.
(xxxviii) Neither the Company nor, to the knowledge of the
Company, any director, officer, agent, employee or affiliate of the Company is
currently subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department ("OFAC"); and the Company will
not directly or indirectly use the proceeds of the offering, or lend,
contribute or otherwise make available such proceeds to any subsidiary, joint
venture partner or other person or entity, for the purpose of financing the
activities of any person currently subject to any U.S. sanctions administered
by OFAC.
(xxxix) The Company acknowledges and agrees that each
Underwriter is acting solely in the capacity of an arm's length contractual
counterparty to the Company with respect to the offering of Underwritten
Securities contemplated hereby (including in connection with determining the
terms of the offering) and not as a financial advisor or a fiduciary to, or an
agent of, the Company or any other person. Additionally, no Underwriter is
advising the Company or any other person as to any legal, tax, investment,
accounting or regulatory matters in any jurisdiction. The Company shall
consult with its own advisors concerning such matters and shall be responsible
for making its own independent investigation and appraisal of the transactions
contemplated hereby, and no Underwriter shall have any responsibility or
liability to the Company with respect thereto. Any review by an Underwriter of
the Company, the transactions contemplated hereby or other matters relating to
such transactions will be performed solely for the benefit of such Underwriter
and shall not be on behalf of the Company.
(b) Representations and Warranties of the Manager. The Manager
represents and warrants to you, as of the date hereof, and to you and each
Underwriter named in the applicable Terms Agreement, as of each Representation
Date as follows:
(i) The information concerning the Manager and its affiliates
(other than the Company and its subsidiaries) included or incorporated by
reference in the Registration Statement, the General Disclosure Package and
the Prospectus is true and correct in all material respects.
(ii) The Manager has been duly organized and is validly
existing as a limited liability company and is in good standing under the laws
of Delaware. The Manager is duly qualified to do business and is in good
standing as a foreign limited liability company in each jurisdiction in which
the character or location of its properties (owned, leased or licensed) or the
nature or conduct of its business makes such qualification necessary, except
for those failures to be so qualified or in good standing which will not in
the aggregate have a Material Adverse Effect. The Manager has all requisite
power and authority, and all necessary Governmental Licenses, to own, lease
and operate its properties and conduct its business as it is now being
conducted, except where the failure to possess such Governmental Licenses will
not in the aggregate have a Material Adverse Effect, and no such consent,
approval, authorization, order, registration, qualification, license or permit
contains a materially burdensome restriction not adequately disclosed or
incorporated by reference in the Registration Statement, the General
Disclosure Package and the Prospectus.
15
(iii) This Agreement, the related Terms Agreement and the
Management Agreement have each been duly and validly authorized, executed and
delivered by the Manager. The Management Agreement constitutes a valid and
binding agreement of the Manager, enforceable in accordance with its terms,
except to the extent that enforcement thereof may be limited by bankruptcy,
insolvency, reorganization or other laws affecting enforcement of creditors'
rights or by general equitable principles.
(iv) The Manager is not (i) in violation of its charter or
limited liability company agreement or (ii) in default under, and no event has
occurred which, with notice or lapse of time or both, would constitute such a
default under, or result in the creation or imposition of any lien, charge or
encumbrance upon, any property or assets of the Manager or any of its
subsidiaries pursuant to, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which it is a party or by which
it is bound or to which any of its property or assets is subject or in
violation in any respect of any statute or any judgment, decree, order, rule
or regulation of any court or governmental or regulatory agency or body having
jurisdiction over the Manager or any of its subsidiaries or any of their
properties or assets, except in the case of (ii) above any default or event
that would not have a Material Adverse Effect.
(v) Except as described in the Registration Statement, the
General Disclosure Package and the Prospectus, there is no legal or
governmental proceeding to which the Manager or any of its subsidiaries is a
party, or of which any property of the Manager or any of its subsidiaries is
the subject which, singularly or in the aggregate, if determined adversely to
the Manager or any of its subsidiaries, are reasonably likely to have a
Material Adverse Effect, and to the best of the Manager's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened or contemplated by others.
(vi) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency is necessary or required for the performance
by the Manager of its obligations hereunder which have not been made or the
failure of which to have been made in the aggregate would not have a Material
Adverse Effect.
(vii) The Manager is not prohibited by the Investment Advisers
Act of 1940, as amended (the "Advisers Act"), or the rules and regulations
thereunder, from acting under the Management Agreement as contemplated by the
Registration Statement and Prospectus.
(viii) With respect to each taxable year ended December 31,
2001 and 2002, Newcastle Investment Holdings Corp. ("NIH"), a corporation
which was organized and existed under the laws of the State of Maryland,
operated in conformity with the requirements for qualification and taxation as
a REIT under the Code. NIH qualified as a REIT for its taxable years ended
December 31, 2001 and 2002.
16
2. Purchase, Sale and Delivery of the Underwritten Securities.
----------------------------------------------------------
(a) The several commitments of the Underwriters to purchase the
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to have been made on the basis of the representations and warranties
herein contained and shall be subject to the terms and conditions herein set
forth.
(b) In addition, on the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company may grant, if so provided in the applicable Terms Agreement relating
to the Initial Underwritten Securities, an option to the Underwriters named in
such Terms Agreement, severally and not jointly, to purchase up to the number
of Option Securities set forth therein at the same price per Option Security
as is applicable to the Initial Underwritten Securities less the amount of any
distribution payable with respect to an Initial Underwritten Security but not
payable with respect to an Option Security. Such option, if granted, will
expire 30 days or such lesser number of days as may be specified in the
applicable Terms Agreement after the Representation Date relating to the
Initial Underwritten Securities, and may be exercised in whole or in part from
time to time only for the purpose of covering over-allotments which may be
made in connection with the offering and distribution of the Initial
Underwritten Securities upon notice by you to the Company setting forth the
number of Option Securities as to which the several Underwriters are then
exercising the option and the time, date and place of payment and delivery for
such Option Securities. Any such time and date of delivery (a "Date of
Delivery") shall be determined by you, but shall not be later than three full
business days and not be earlier than two full business days after the
exercise of said option, unless otherwise agreed upon by you and the Company.
If the option is exercised as to all or any portion of the Option Securities,
each of the Underwriters, acting severally and not jointly, will purchase that
proportion of the total number of Option Securities then being purchased which
the number of Initial Underwritten Securities each such Underwriter has
severally agreed to purchase as set forth in the applicable Terms Agreement
bears to the total number of Initial Underwritten Securities (except as
otherwise provided in the applicable Terms Agreement), subject to such
adjustments as you in your discretion shall make to eliminate any sales or
purchases of fractional Initial Underwritten Securities.
(c) Payment of the purchase price for, and delivery of, the
Underwritten Securities to be purchased by the Underwriters shall be made at
the office of Sidley Austin LLP, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
or at such other place as shall be agreed upon by you and the Company, at
10:00 A.M., New York City time, on the third or fourth business day (as
permitted under Rule 15c6-1 under the 0000 Xxx) (unless postponed in
accordance with the provisions of Section 9) specified in the applicable Terms
Agreement or at such other time as shall be agreed upon by you and the Company
(each such time and date being referred to as a "Closing Time"). In addition,
in the event that any or all of the Option Securities are purchased by the
Underwriters, payment of the purchase price for, and delivery of certificates
representing, such Option Securities, shall be made at the above-mentioned
offices of Sidley Austin LLP, or at such other place as shall be agreed upon
by you and the Company on each Date of Delivery as specified in the notice
from you to the Company. Unless otherwise specified in the applicable Terms
Agreement, payment shall be made by wire transfer in Federal (same day) funds
to the Company upon delivery of certificates for the Underwritten Securities
to you, through the facilities of the Depository Trust Company, if applicable,
for the respective accounts of the
17
Underwriters for the Underwritten Securities to be purchased by them against
receipt therefor signed by you. The Underwritten Securities or, if applicable,
the Depositary Receipts evidencing the Depositary Shares, shall be in such
authorized denominations and registered in such names as you may request in
writing at least one business day prior to the applicable Closing Time or Date
of Delivery, as the case may be. The Underwritten Securities, which may be in
temporary form, will be made available for examination and packaging by you on
or before the first business day prior to the Closing Time or Date of
Delivery, as the case may be.
(d) If authorized by the applicable Terms Agreement, the Underwriters
named therein may solicit offers to purchase Underwritten Securities from the
Company pursuant to delayed delivery contracts ("Delayed Delivery Contracts")
substantially in the form of Exhibit B hereto with such changes therein as the
Company may approve. As compensation for arranging Delayed Delivery Contracts,
the Company will pay to you at Closing Time, for the respective accounts of
the Underwriters, a fee specified in the applicable Terms Agreement for each
of the Underwritten Securities for which Delayed Delivery Contracts are made
at the Closing Time as is specified in the applicable Terms Agreement. Any
Delayed Delivery Contracts are to be with institutional investors of the types
described in the General Disclosure Package and the Prospectus. At the Closing
Time, the Company will enter into Delayed Delivery Contracts (for not less
than the minimum number of Underwritten Securities per Delayed Delivery
Contract specified in the applicable Terms Agreement) with all purchasers
proposed by the Underwriters and previously approved by the Company as
provided below, but not for an aggregate number of Underwritten Securities in
excess of that specified in the applicable Terms Agreement. The Underwriters
will not have any responsibility for the validity or performance of Delayed
Delivery Contracts.
You shall submit to the Company, at least two business days prior to
the Closing Time, the names of any institutional investors with which it is
proposed that the Company will enter into Delayed Delivery Contracts and the
number of Underwritten Securities to be purchased by each of them, and the
Company will advise you, at least two business days prior to the Closing Time,
of the names of the institutions with which the making of Delayed Delivery
Contracts is approved by the Company and the number of Underwritten Securities
to be covered by each such Delayed Delivery Contract.
The number of Underwritten Securities agreed to be purchased by the
several Underwriters pursuant to the applicable Terms Agreement shall be
reduced by the number of Underwritten Securities covered by Delayed Delivery
Contracts, as to each Underwriter as set forth in a written notice delivered
by you to the Company; provided, however, that the total number of
Underwritten Securities to be purchased by all Underwriters shall be the total
number of Underwritten Securities covered by the applicable Terms Agreement,
less the number of Underwritten Securities covered by Delayed Delivery
Contracts.
3. Covenants.
---------
(a) Covenants of the Company. The Company covenants and agrees with
you and each Underwriter participating in the offering of Underwritten
Securities as follows:
18
(i) The Company will comply with the requirements of Rule 430B.
The Company will promptly transmit copies of the Prospectus, properly
completed, and any supplement thereto to the Commission for filing pursuant to
the applicable paragraph of Rule 424(b) within the time period prescribed
therein (without reliance on Rule 424(b)(8), and will take such steps as it
deems necessary to ascertain promptly whether the Prospectus transmitted for
filing under Rule 424(b) was received for filing by the Commission and, in the
event that it was not, it will promptly file such Prospectus. The Company will
furnish to the Underwriters named therein as many copies of the Prospectus as
you shall reasonably request.
(ii) The Company will notify you immediately, and if written
notice is requested by you, confirm such notice in writing as soon as
reasonably practicable, of (i) the effectiveness of any amendment to the
Registration Statement, (ii) the transmittal to the Commission for filing of
any supplement or amendment to the Prospectus or any document to be filed
pursuant to the 1934 Act, (iii) the receipt of any comments from the
Commission, (iv) any request by the Commission for any amendment to the
Registration Statement or any amendment or supplement to the Prospectus or for
additional information, and (v) the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose; and the Company will make
every reasonable effort to prevent the issuance of any stop order and, if any
stop order is issued, to obtain the lifting thereof at the earliest possible
moment.
(iii) The Company has given you notice of any filings made
pursuant to the 1934 Act or 1934 Act Regulations that were made within 48
hours prior to the Applicable Time; the Company will give you notice of its
intention to make any such filing from the Applicable Time to the Closing Time
and will furnish you with copies of any such documents a reasonable amount of
time prior to such proposed filing and will not file or use any such document
to which you or counsel for the Underwriters shall reasonably object. At any
time when the Prospectus is required to be delivered (or but for the exemption
in Rule 172 under the 1933 Act would be required to be delivered) under the
1933 Act or the 1934 Act in connection with sales of the Underwritten
Securities, the Company will give you notice of its intention to file or
prepare any amendment to the Registration Statement or any amendment,
supplement or any revision to either any preliminary prospectus (including any
prospectus included in the Registration Statement at the time the Registration
Statement first became effective or any amendment thereto at the time it
became effective) or the Prospectus, whether pursuant to the 1933 Act, the
1934 Act or otherwise, and the Company will furnish you with copies of any
such amendment or supplement or other documents proposed to be filed or used a
reasonable amount of time prior to such proposed filing or use, as the case
may be, and will not file any such amendment or supplement or other documents
in a form to which you or counsel for the Underwriters shall reasonably
object. If requested by the Underwriters, the Company will prepare a final
term sheet (the "Final Term Sheet") reflecting the final terms of the
Underwritten Securities and shall file with the Commission such Final Term
Sheet as an "issuer free writing prospectus" pursuant to Rule 433 prior to the
close of business within two business days after the date of the applicable
Terms Agreement; provided that the Company shall furnish the Underwriters with
copies of such Final Term Sheet a reasonable amount of time prior to such
proposed filing and will not use or file any such document to which you or
counsel to the Underwriters shall reasonably object.
19
(iv) The Company has furnished or will deliver to each
Underwriter as many signed and conformed copies of the Registration Statement
as originally filed and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein and documents incorporated or
deemed to be incorporated by reference therein) as such Underwriter reasonably
requests.
(v) The Company has furnished to each Underwriter, without
charge, as many copies of each preliminary prospectus as such Underwriter
reasonably requested, and the Company has furnished to each Underwriter,
without charge, as many copies of each Issuer Free Writing Prospectus, if any,
as such Underwriter reasonably requested, and the Company hereby consents to
the use of such copies of each preliminary prospectus and each Issuer Free
Writing Prospectus, if any, by the Underwriters for purposes permitted by the
1933 Act. The Company will furnish to each Underwriter, from time to time
during the period when the Prospectus is required to be delivered (or but for
the exemption in Rule 172 under the 1933 Act would be required to be
delivered) under the 1933 Act or the 1934 Act in connection with sales of the
Underwritten Securities, such number of copies of the Prospectus (as amended
or supplemented) as such Underwriter may reasonably request for the purposes
contemplated by the 1933 Act, the 1933 Act Regulations, the 1934 Act or the
1934 Act Regulations.
(vi) If at any time when the Prospectus is required to be
delivered (or but for the exemption in Rule 172 under the 1933 Act would be
required to be delivered) under the 1933 Act or the 1934 Act in connection
with sales of the Underwritten Securities any event shall occur or condition
exist as a result of which it is necessary, in the opinion of counsel for the
Underwriters or counsel for the Company, to amend or supplement the Prospectus
in order that the Prospectus will not include an untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein not misleading in the light of the circumstances
existing at the time it is delivered to a purchaser, or if it shall be
necessary, in the opinion of either such counsel, at any such time to amend or
supplement the Registration Statement or the Prospectus in order to comply
with the requirements of the 1933 Act or the 1933 Act Regulations, then the
Company will promptly prepare and, subject to Section 3(a)(iii), file with the
Commission such amendment or supplement, whether by filing documents pursuant
to the 1933 Act, the 1934 Act or otherwise, as may be necessary to correct
such untrue statement or omission or to make the Registration Statement and
Prospectus comply with such requirements, and the Company will furnish to the
Underwriters a reasonable number of copies of such amendment or supplement. If
at any time after the date of the applicable Terms Agreement, an event or
development occurs as a result of which the General Disclosure Package
contains an untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances existing at the time it is used, not misleading, the Company
will promptly notify the Underwriters and will promptly amend or supplement in
a manner reasonably satisfactory to the Underwriters, at its own expense, the
General Disclosure Package to eliminate or correct such untrue statement or
omission. If at any time following the issuance of an Issuer Free Writing
Prospectus there occurred or occurs an event or development as a result of
which such Issuer Free Writing Prospectus conflicted or would conflict with
the information contained in the Registration Statement (or any other
registration statement relating to the Underwritten Securities) or the
Statutory Prospectus or any preliminary prospectus or included or would
include an untrue statement of a material fact or omitted or would omit to
state a material fact necessary in order to make the statements therein,
20
in the light of the circumstances prevailing at that subsequent time, not
misleading, the Company will promptly notify the Underwriters and will
promptly amend or supplement, at its own expense, such Issuer Free Writing
Prospectus to eliminate or correct such conflict, untrue statement or
omission. The Underwriters' delivery of any such amendment or supplement shall
not constitute a waiver of any of the conditions in Section 5 hereof.
(vii) The Company will endeavor, in cooperation with the
Underwriters, to qualify the Underwritten Securities, the Warrant Securities,
if any, and the shares of Common Stock issuable upon conversion of the
Preferred Shares or the Depositary Shares, if any, for offering and sale under
the applicable securities laws and real estate syndication laws of such states
and other jurisdictions of the United States as you may designate. In each
jurisdiction in which the Underwritten Securities, the Warrant Securities, if
any, and the shares of Common Stock issuable upon conversion of the Preferred
Shares or the Depositary Shares, if any, have been so qualified, the Company
will file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for so long as may be
required for the distribution of the Underwritten Securities and the Warrant
Securities, if any; provided, however, that the Company shall not be obligated
to (A) qualify as a foreign entity in any jurisdiction where it is not so
qualified, (B) file any general consent to service of process, or (C) take any
action that would subject it to income taxation in any such jurisdiction.
(viii) With respect to each sale of Underwritten Securities,
the Company will make generally available to its security holders as soon as
practicable, but not later than 90 days after the close of the period covered
thereby, an earnings statement (in form complying with the provisions of Rule
158 of the 1933 Act Regulations) covering a twelve-month period beginning not
later than the first day of the Company's fiscal quarter next following the
"effective date" (as defined in such Rule 158) of the Registration Statement.
(ix) The Company, during the period when the Prospectus is
required to be delivered (or but for the exemption in Rule 172 under the 1933
Act would be required to be delivered) under the 1933 Act or the 1934 Act in
connection with sales of the Underwritten Securities, will file all documents
required to be filed with the Commission pursuant to Section 13, 14 or 15 of
the 1934 Act within the time period prescribed by the 1934 Act and the 1934
Act Regulations.
(x) The Company represents and agrees that, unless it obtains
the prior written consent of the Underwriters, such consent not to be
unreasonably withheld, and each Underwriter agrees that, unless it obtains the
prior written consent of the Company and the other Underwriters, such consent
not to be unreasonably withheld, it has not made and will not make any offer
relating to the Underwritten Securities that would constitute an "issuer free
writing prospectus", as defined in Rule 433, or that would otherwise
constitute a "free writing prospectus," as defined in Rule 405, in each case
required to be filed with the Commission; provided, however, that prior to the
preparation of the Prospectus or, if applicable, the Final Term Sheet in
accordance with Section 3(a)(i) or 3(a)(iii), as the case may be, the
Underwriters are authorized to use the information with respect to the final
terms of the Underwritten Securities in communications orally conveying
information relating to the offering to investors. Any such free writing
prospectus consented to by the Company and the Underwriters is hereinafter
referred to as a "Permitted Free Writing Prospectus." The Company represents
that is
21
has treated or agrees that it will treat each Permitted Free Writing
Prospectus as an "issuer free writing prospectus," as defined in Rule 433, and
has complied and will comply with the requirements of Rule 433 applicable to
any Permitted Free Writing Prospectus, including timely filing with the
Commission where required, legending and record keeping.
(xi) During the period of 14 days from the date of the
Prospectus, the Company will not, directly or indirectly, without your prior
written consent, (a) issue, sell, offer or agree to sell, grant any option for
the sale of, pledge, make any short sale or maintain any short position,
establish or maintain a "put equivalent position" (within the meaning of Rule
16a-1(h) under the 1934 Act), enter into any swap, derivative transaction or
other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Stock (whether any such
transaction is to be settled by delivery of Common Stock, other securities,
cash or other consideration) or otherwise dispose of, any Common Stock (or any
securities convertible into, exercisable for or exchangeable for Common Stock)
or interest therein of the Company or of any of its subsidiaries, other than
the Company's sale of Underwritten Securities pursuant to the applicable Terms
Agreement and the Company's issuance of Common Stock (i) upon the exercise of
presently outstanding options, (ii) in connection with acquisitions by the
Company or a subsidiary, and (iii) in connection with the grant and exercise
of options under, or the issuance and sale of shares pursuant to, employee
stock option plans in effect on the date hereof or (b) file a registration
statement under the 1933 Act registering shares of Common Stock (or any
securities convertible into, exercisable for or exchangeable for Common Stock)
or any interest in shares of Common Stock, except for a registration statement
on Form S-8 with respect to shares of Common Stock issuable under the
Newcastle Investment Corp. Nonqualified Stock Option and Incentive Award Plan,
as amended from time to time.
(xii) If the Preferred Shares or Depositary Shares are
convertible into shares of Common Stock or if Common Stock Warrants are
issued, the Company will reserve and keep available at all times, free of
preemptive or other similar rights, a sufficient number of shares of Common
Stock or Preferred Shares, as the case may be, for the purpose of enabling the
Company to satisfy any obligations to issue such shares upon conversion of the
Preferred Shares or the Depositary Shares, as the case may be, or upon
exercise of the Common Stock Warrants.
(xiii) If the Underwritten Securities are Common Stock,
Preferred Shares or Depositary Shares, the Company will use its best efforts
to list such shares of Common Stock, Preferred Shares or Depositary Shares, as
the case may be, on the New York Stock Exchange or such other national
securities exchange on which the Company's shares of Common Stock are then
listed. If the Preferred Shares or Depositary Shares are convertible into
shares of Common Stock, the Company will use its best efforts to list the
shares of Common Stock issuable upon conversion of the Preferred Shares or
Depositary Shares on the New York Stock Exchange or such other national
securities exchange on which the Company's shares of Common Stock are then
listed.
(xiv) The Company will apply the net proceeds from the sale of
the Underwritten Securities as set forth under "Use of Proceeds" in the
Prospectus.
22
(xv) The Company will use its best efforts to meet the
requirements to qualify as a "real estate investment trust" under the Code for
each of its taxable years for so long as the Board of Directors of the Company
deems it in the best interests of the Company's shareholders to remain so
qualified.
(b) Covenant of the Manager. The Manager covenants and agrees with
you and each Underwriter participating in the offering of Underwritten
Securities, and with the Company that, during any time when the Prospectus is
required to be delivered (or but for the exemption in Rule 172 under the 1933
Act would be required to be delivered) under the 1933 Act or the 1934 Act in
connection with sales of Underwritten Securities, it shall notify you and the
Company of the occurrence of any material events respecting its activities,
affairs or condition, financial or otherwise, if, but only if, as a result of
any such event it is necessary, in the opinion of counsel for the Underwriters
or counsel for the Company, to (i) amend or supplement the Prospectus in order
to make the Prospectus not misleading in the light of the circumstances
existing at the time it is delivered to a purchaser (unless the exemption in
Rule 172 under the 1933 Act applies), (ii) amend or supplement the
Registration Statement or the Prospectus in order to comply with the
requirements of the 1933 Act or the 1933 Act Regulations, (iii) amend or
supplement the General Disclosure Package in order to make the General
Disclosure Package not misleading in the light of the circumstances existing
at the time it is used or (iv) amend or supplement an Issuer Free Writing
Prospectus to eliminate or correct a conflict with the information contained
in the Registration Statement or the Statutory Prospectus or any preliminary
prospectus or to make the Issuer Free Writing Prospectus not misleading in the
light of the circumstances prevailing at the time it is used, the Manager will
forthwith supply such information to the Company as shall be necessary for the
Company to prepare an amendment or supplement to the Registration Statement,
the Prospectus, the General Disclosure Package or the Issuer Free Writing
Prospectus, as the case may be, and then the Company will promptly prepare
and, subject to Section 3(a)(iii), file with the Commission such amendment or
supplement, whether by filing documents pursuant to the 1933 Act, the 1934 Act
or otherwise, as may be necessary to correct such untrue statement or omission
or conflict or to make the Registration Statement and Prospectus comply with
such requirements, as the case may be, and the Company will furnish to the
Underwriters a reasonable number of copies of such amendment or supplement.
4. Payment of Expenses.
-------------------
(a) Expenses. Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, the Company will
pay all expenses incident to the performance of its obligations under this
Agreement or the applicable Terms Agreement, including (i) the printing and
filing of the Registration Statement as originally filed and of each amendment
thereto, (ii) the reproduction and filing of this Agreement, the applicable
Terms Agreement and, if applicable, a Deposit Agreement or a Warrant
Agreement, (iii) the preparation, issuance and delivery of the Underwritten
Securities and the Warrant Securities, if any, to the Underwriters, (iv) the
fees and disbursements of the Company's counsel and accountants, (v) the
qualification of the Underwritten Securities, the Warrant Securities and the
Common Shares issuable upon conversion of Preferred Shares or the Depositary
Shares, if any, under securities laws and real estate syndication laws in
accordance with the provisions of Section 3(a)(vii), including filing fees and
the fees and disbursements of counsel for the Underwriters in connection
therewith and in connection with the preparation of any Blue Sky
23
Survey (if applicable), (vi) the reproduction and delivery to the Underwriters
of copies of any Blue Sky Survey (if applicable), (vii) the printing and
delivery to the Underwriters of copies of the Registration Statement as
originally filed and of each amendment thereto, each preliminary prospectus,
the Prospectus, any Permitted Free Writing Prospectus and any amendments or
supplements thereto, (viii) the providing and delivery to the Underwriters of
copies of the applicable Warrant Agreement, if any, (ix) any fees charged by
nationally recognized statistical rating organizations for the rating of the
Securities, (x) the fees and expenses, if any, incurred with respect to the
listing of the Underwritten Securities, or the Common Shares issuable on
conversion of the Preferred Shares or the Depositary Shares, if any, on any
national securities exchange, (xi) the fees and expenses, if any, incurred
with respect to any filing with the National Association of Securities
Dealers, Inc. (the "NASD") (if applicable) and (xii) all travel expenses of
the Company's officers and employees and any other expense of the Company
incurred in connection with attending or hosting meetings with prospective
purchasers of the Underwritten Securities (other than as shall have been
specifically approved by the Underwriters to be paid for by the Underwriters).
The Company also will pay or cause to be paid: (i) the cost of preparing stock
certificates; (ii) the cost and charges of any transfer agent or registrar;
and (iii) all other costs and expenses incident to the performance of its
obligations hereunder which are not otherwise specifically provided for in
this Section 4. It is understood, however, that except as provided in this
Section 4 and Section 6 hereof, the Underwriters will pay all of their own
costs and expenses, including the fees of their counsel, stock transfer taxes
on resale of any of the Underwritten Securities by them, and any advertising
expenses connected with any offers they may make.
(b) Termination of Agreement. If this Agreement is terminated by the
Underwriters in accordance with the provisions of Section 5, Section 8(a)(i),
the first clause of Section 8(a)(iii) or Section 8(a)(vi) hereof, the Company
shall reimburse the Underwriters for all of their out-of-pocket expenses,
including the reasonable fees and disbursements of counsel for the
Underwriters, incurred in connection herewith.
5. Conditions of Underwriters' Obligations. The several obligations
of the Underwriters to purchase Underwritten Securities pursuant to the
applicable Terms Agreement, shall be subject to the accuracy of the
representations and warranties of the Company and the Manager herein contained
as of the date hereof, the Applicable Time and as of the Closing Time, to the
absence from any certificates, opinions, written statements or letters
furnished to you or to Sidley Austin LLP ("Underwriters' Counsel") pursuant to
this Section 5 of any misstatement or omission to the performance by the
Company and the Manager of their respective obligations hereunder, and to each
of the following additional terms and conditions:
(a) At Closing Time, (i) no stop order suspending the effectiveness
of the Registration Statement shall have been issued under the 1933 Act or
proceedings therefor initiated or threatened by the Commission, (ii) each
preliminary prospectus and the Prospectus containing the Rule 430B Information
shall have been filed with the Commission in the manner and within the time
period required by Rule 424(b) without reliance on Rule 424(b)(8) (or a
post-effective amendment providing such information shall have been filed and
become effective in accordance with the requirements of Rule 430B), (iii) any
material required to be filed by the Company pursuant to Rule 433(d) of the
1933 Act Regulations shall have been filed with the Commission within the
applicable time periods prescribed for such filings under Rule 433, (iv) if
24
Preferred Shares or Depositary Shares are being offered, the rating assigned
by any nationally recognized statistical rating organization to any preferred
stock of the Company, including such Preferred Shares or Depositary Shares, as
the case may be, as of the date of the applicable Terms Agreement shall not
have been lowered or withdrawn since the date of the applicable Terms
Agreement nor shall any such rating organization have publicly announced that
it has placed any such preferred stock of the Company on what is commonly
termed a "watch list" for possible downgrading, (v) there shall not have come
to your attention any facts that would cause you to believe that (A) the
General Disclosure Package, at the Applicable Time, or (B) the Prospectus, at
the time it was required to be delivered to (or but for the exemption in Rule
172 under the 1933 Act would be required to be delivered) purchasers of the
Underwritten Securities, included an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
therein, in light of the circumstances existing at such time, not misleading
and (vi) the Underwritten Securities or the Common Stock issuable upon
conversion thereof, as applicable in accordance with Section 3(a)(xiii)
hereof, shall be approved for listing on or before the 30th day after Closing
Time in accordance with such Section 3(a)(xiii).
(b) At the Closing Time you shall have received the written opinion
of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the Company and the
Manager, dated the Closing Time and based upon certificates containing certain
factual representations and covenants of the Company, addressed to the
Underwriters substantially in the form attached hereto as Annex I.
(c) At the Closing Time you shall have received the written opinion
of DLA Piper US LLP, special Maryland counsel to the Company, dated the
Closing Time, addressed to the Underwriters substantially in the form attached
hereto as Annex II.
(d) All proceedings taken in connection with the sale of the
Underwritten Securities as contemplated by this Agreement and the applicable
Terms Agreement shall be satisfactory in form and substance to you and to
Underwriters' Counsel, and the Underwriters shall have received from
Underwriters' Counsel a favorable opinion, dated as of the Closing Time, with
respect to the issuance and sale of the Underwritten Securities, the
Registration Statement, the General Disclosure Package and the Prospectus and
such other related matters as you may reasonably require, and the Company
shall have furnished to Underwriters' Counsel such documents as they request
for the purpose of enabling them to pass upon such matters. In rendering such
opinion, Underwriters' Counsel may rely upon the opinion of DLA Piper US LLP
as to matters of Maryland law.
(e) At the Closing Time you shall have received a certificate of the
Chief Executive Officer and Chief Financial Officer of the Company, dated the
Closing Time to the effect that (i) the condition set forth in subsection (a)
of this Section 5 has been satisfied, (ii) as of the date hereof and as of the
Closing Time, the representations and warranties of the Company set forth in
Section 1(a) hereof are accurate, (iii) as of the Closing Time, the
obligations of the Company to be performed hereunder on or prior thereto have
been duly performed and (iv) subsequent to the respective dates as of which
information is given in the Registration Statement, the General Disclosure
Package and the Prospectus (excluding any documents incorporated by reference
pursuant to the 1934 Act after the execution of the applicable Terms
Agreement), the Company and its subsidiaries have not sustained any material
loss or interference with their respective businesses or properties from fire,
flood, hurricane, accident or other calamity, whether or not
25
covered by insurance, or from any labor dispute or any legal or governmental
proceeding, and there has not been any material adverse change, or any
development involving a material adverse change, in the business, properties,
operations, condition (financial or otherwise), or results of operations of
the Company and its subsidiaries taken as a whole, except in each case as
described in or contemplated by the Registration Statement, the General
Disclosure Package and the Prospectus.
(f) At the Closing Time you shall have received a certificate of the
Chief Executive Officer and Chief Financial Officer of the Manager, dated the
Closing Time to the effect that (i) as of the date hereof and as of the
Closing Time, the representations and warranties of the Manager set forth in
Section 1(b) hereof are accurate, (ii) as of the Closing Time, the obligations
of the Manager to be performed hereunder on or prior thereto have been duly
performed and (iii) subsequent to the date of the Registration Statement, the
General Disclosure Package and the Prospectus (excluding any documents
incorporated by reference pursuant to the 1934 Act after the execution of the
applicable Terms Agreement), there has not been any material adverse change in
the business, properties, operations, condition (financial or otherwise), or
results of operations of the Manager and its subsidiaries taken as a whole
that could reasonably be expected in the aggregate to have a Material Adverse
Effect.
(g) At the time this Agreement and the applicable Terms Agreement are
executed, you shall have received a letter agreement from the Manager,
Fortress Principal Investment Holdings LLC ("FPIH"), Fortress Principal
Investment Holdings II LLC ("FPIH II") and Fortress Investment Holdings LLC
("FIH"), and each director, officer or related party of the Company and the
Manager designated by you and listed on Schedule II hereto, substantially in
the forms attached hereto as Annex III and Annex IV, respectively.
(h) At the time that the applicable Terms Agreement is executed and
at the Closing Time, you shall have received a comfort letter from Ernst &
Young LLP, independent registered public accountants for the Company, dated,
respectively, as of the date of the applicable Terms Agreement and as of the
Closing Time, addressed to the Underwriters and in form and substance
satisfactory to the Underwriters and Underwriters' Counsel.
(i) The Company shall have complied with the provisions of Section
3(a)(iii) hereof with respect to the furnishing of prospectuses.
(j) The Company shall have furnished the Underwriters and
Underwriters' Counsel with such other certificates, opinions or other
documents as they may have reasonably requested.
(k) In the event the Underwriters exercise their option provided in a
Terms Agreement as set forth in Section 2(b) hereof to purchase all or any
portion of the Option Securities, the representations and warranties of the
Company and the Manager contained herein and the statements in any
certificates furnished by the Company or the Manager hereunder shall be true
and correct as of each Date of Delivery, and, at the relevant Date of
Delivery, you shall have received:
26
(i) A certificate, dated such Date of Delivery, of the Chief
Executive Officer and Chief Financial Officer of the Company, confirming that
the certificate delivered at Closing Time pursuant to Section 5(e) hereof
remains true and correct as of such Date of Delivery.
(ii) A certificate, dated such Date of Delivery, of the Chief
Executive Officer and Chief Financial Officer of the Manager, confirming that
the certificate delivered at Closing Time pursuant to Section 5(f) hereof
remains true and correct as of such Date of Delivery.
(iii) The favorable opinion of Skadden, Arps, Slate, Xxxxxxx &
Xxxx LLP, counsel for the Company and the Manager, in form and substance
satisfactory to Underwriters' Counsel, dated such Date of Delivery, relating
to the Option Securities and otherwise substantially to the same effect as the
opinion required by Section 5(b) hereof.
(iv) The favorable opinion of DLA Piper US LLP, special
Maryland counsel to the Company, in form and substance satisfactory to
Underwriters' Counsel, dated such Date of Delivery, relating to the Option
Securities and otherwise substantially to the same effect as the opinion
required by Section 5(c) hereof.
(v) The favorable opinion of Underwriters' Counsel, dated such
Date of Delivery, relating to the Option Securities and otherwise to the same
effect as the opinion required by Section 5(d) hereof.
(vi) A letter from Ernst & Young LLP, independent public
accountants for the Company, in form and substance satisfactory to you and
dated such Date of Delivery, substantially the same in scope and substance as
the letter furnished to you pursuant to Section 5(h) hereof.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, the applicable Terms Agreement
may be terminated by you by notice to the Company at any time at or prior to
Closing Time, which notice shall be confirmed in writing by the Underwriters
as soon as reasonably practicable if so requested by the Company, and such
termination shall be without liability of any party to any other party except
as provided in Section 4 and except that Sections 1, 6, 7 and 10 shall survive
any such termination and remain in full force and effect pursuant to Section
10.
6. Indemnification.
----------------
(a) Indemnification of Underwriters. The Company agrees to indemnify
and hold harmless each Underwriter, its affiliates, as such term is defined in
Rule 501(b) under the 1933 Act (each, an "Affiliate"), its selling agents and
each person, if any, who controls any Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430B Information, or the omission or alleged omission therefrom of a
material fact required to be stated therein or necessary to make the
statements therein not misleading
27
or arising out of any untrue statement or alleged untrue statement of
a material fact included in the General Disclosure Package, any
preliminary prospectus, the Prospectus or any Issuer Free Writing
Prospectus (or any amendment or supplement thereto), or the omission
or alleged omission therefrom of a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission; provided that (subject to Section 6(d) below) any such
settlement is effected with the written consent of the Company;
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by you),
reasonably incurred in investigating, preparing or defending against
any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any
such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by or
on behalf of any Underwriter through you expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430B Information, or
in the General Disclosure Package, any preliminary prospectus, the Prospectus
or any Issuer Free Writing Prospectus (or any amendment or supplement
thereto).
(b) Indemnification of Company, Directors and Officers. Each Underwriter
severally agrees to indemnify and hold harmless the Company, its directors,
each of its officers who signed the Registration Statement, and each person,
if any, who controls the Company within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act against any and all loss, liability, claim,
damage and expense described in the indemnity contained in subsection (a) of
this Section 6, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430B Information, or
in the General Disclosure Package, any preliminary prospectus, the Prospectus
or any Issuer Free Writing Prospectus (or any amendment or supplement thereto)
in reliance upon and in conformity with written information furnished to the
Company by such Underwriter through you expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430B Information, or
in the General Disclosure Package, such preliminary prospectus, the Prospectus
or such Issuer Free Writing Prospectus (or any amendment or supplement
thereto).
(c) Actions against Parties; Notification. Each indemnified party shall give
notice as promptly as reasonably practicable to each indemnifying party of any
action commenced against
28
it in respect of which indemnity may be sought hereunder, but failure to so
notify an indemnifying party shall not relieve such indemnifying party from
any liability hereunder to the extent it is not materially prejudiced as a
result thereof and in any event shall not relieve it from any liability which
it may have otherwise than on account of this indemnity agreement. In the case
of parties indemnified pursuant to Section 6(a) above, counsel to the
indemnified parties shall be selected by you, and, in the case of parties
indemnified pursuant to Section 6(b) above, counsel to the indemnified parties
shall be selected by the Company. An indemnifying party may participate at its
own expense in the defense of any such action; provided, however, that counsel
to the indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party. In no event shall
the indemnifying parties be liable for fees and expenses of more than one
counsel (in addition to any local counsel) separate from their own counsel for
all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances. No indemnifying party shall, without the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which indemnification or
contribution could be sought under this Section 6 or Section 7 hereof (whether
or not the indemnified parties are actual or potential parties thereto),
unless such settlement, compromise or consent (i) includes an unconditional
release of each indemnified party from all liability arising out of such
litigation, investigation, proceeding or claim 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 any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 6(a)(ii) effected without its written consent
if (i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party
shall have received notice of the terms of such settlement at least 30 days
prior to such settlement being entered into and (iii) such indemnifying party
shall not have reimbursed such indemnified party in accordance with such
request prior to the date of such settlement.
7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (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 hand from the offering of the
Underwritten Securities pursuant to the applicable Terms Agreement or (ii) if
the allocation provided by clause (i) 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 of the Underwriters on the other hand in connection with the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
29
The relative benefits received by the Company on the one hand and the
Underwriters on the other hand in connection with the offering of the
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of the Underwritten Securities pursuant to the applicable Terms
Agreement (before deducting expenses) received by the Company and the total
underwriting discount received by the Underwriters, in each case as set forth
on the cover of the Prospectus bear to the aggregate initial public offering
price of the Underwritten Securities as set forth on the cover of the
Prospectus.
The relative fault of the Company on the one hand and the
Underwriters on the other hand shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct
or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 7. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 7 shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter
shall be required to contribute any amount in excess of the amount by which
the total price at which the Underwritten Securities pursuant to the
applicable Terms Agreement 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 any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act and each Underwriter's Affiliates and selling agents shall have
the same rights to contribution as such Underwriter, and each director of the
Company, each officer of the Company who signed the Registration Statement,
and each person, if any, who controls the Company within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same
rights to contribution as the Company. The Underwriters' respective
obligations to contribute pursuant to this Section 7 are several in proportion
to the number of Initial Underwritten Securities set forth opposite their
respective names in the applicable Terms Agreement.
30
8. Termination of Agreement.
------------------------
(a) Termination; General. This Agreement (excluding the applicable
Terms Agreement) may be terminated for any reason at any time by the Company
or by you upon the giving of 30 days' written notice of such termination to
the other party hereto. The Underwriters may also terminate the applicable
Terms Agreement, by notice to the Company, at any time at or prior to the
Closing Time (i) if there has been, since the time of execution of such Terms
Agreement or since the respective dates as of which information is given in
the General Disclosure Package and the Prospectus (excluding any documents
incorporated therein by reference pursuant to the 1934 Act after the execution
of the applicable Terms Agreement), any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii)
if there has occurred any material adverse change in the financial markets in
the United States or the international financial markets, any outbreak of
hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international
political, financial or economic conditions, in each case the effect of which
is such as to make it, in the judgment of the Underwriters, impracticable or
inadvisable to market the Underwritten Securities or to enforce contracts for
the sale of the Underwritten Securities, or (iii) if trading in any securities
of the Company has been suspended or materially limited by the Commission or
the New York Stock Exchange, or if trading generally on the New York Stock
Exchange has been suspended or materially limited, or minimum or maximum
prices for trading have been fixed, or maximum ranges for prices have been
required, by said exchange or by such system or by order of the Commission,
the NASD or any other governmental authority having jurisdiction, or (iv) if a
material disruption has occurred in commercial banking or securities
settlement or clearance services in the United States, or (v) if a banking
moratorium has been declared by either Federal or New York authorities, or
(vi) if Preferred Shares or Depositary Shares are being offered and the rating
assigned by any nationally recognized statistical rating organization to any
preferred stock of the Company, including such Preferred Shares or Depositary
Shares, as the case may be, as of the date of the applicable Terms Agreement
shall have been lowered or withdrawn since such date or if any such rating
organization shall have publicly announced that it has placed any such
preferred stock of the Company on what is commonly termed a "watch list" for
possible downgrading.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section 8, such termination shall be without liability of any party to any
other party except as provided in Section 4 hereof, and provided further that
Sections 1, 6, 7 and 10 shall survive such termination and remain in full
force and effect.
9. Default by an Underwriter.
-------------------------
(a) If any Underwriter or Underwriters shall default in its or their
obligation to purchase the Underwritten Securities pursuant to the applicable
Terms Agreement, and if the Underwritten Securities with respect to which such
default relates do not (after giving effect to arrangements, if any, made by
you pursuant to subsection (b) below) exceed in the aggregate 10% of the
number of the Underwritten Securities, the Underwritten Securities to which
the default relates shall be purchased by the non-defaulting Underwriters in
proportion to the respective proportions
31
which the numbers of the Underwritten Securities set forth opposite their
respective names in the applicable Terms Agreement bear to the aggregate
number of Underwritten Securities set forth opposite the names of the
non-defaulting Underwriters.
(b) In the event that such default relates to more than 10% of the
Underwritten Securities, you may in your discretion arrange for yourself or
for another party or parties (including any non-defaulting Underwriter or
Underwriters who so agree) to purchase such Underwritten Securities, to which
such default relates on the terms contained herein. In the event that within
five calendar days after such a default you do not arrange for the purchase of
the Underwritten Securities to which such default relates as provided in this
Section 9, this Agreement or, in the case of a default with respect to Option
Securities, the obligations of the Underwriters to purchase and of the Company
to sell the Option Securities shall thereupon terminate, without liability on
the part of the Company with respect thereto (except in each case as provided
in Sections 4, 6(a) and 7 hereof) or the Underwriters, but nothing in this
Agreement shall relieve a defaulting Underwriter or Underwriters of its or
their liability, if any, to the other Underwriters and the Company for damages
occasioned by its or their default hereunder.
(c) In the event that the Underwritten Securities to which the default relates
are to be purchased by the non-defaulting Underwriters, or are to be purchased
by another party or parties as aforesaid, you or the Company shall have the
right to postpone the Closing Time, as the case may be, for a period, not
exceeding five business days, in order to effect whatever changes may thereby
be made necessary in the Registration Statement or the Prospectus or in any
other documents and arrangements, and the Company agrees to file promptly any
amendment or supplement to the Registration Statement or the Prospectus which,
in the opinion of Underwriters' Counsel, may thereby be made necessary or
advisable. The term "Underwriter" as used in this Agreement shall include any
party substituted under this Section 9 with like effect as if it had
originally been a party to this Agreement and the applicable Terms Agreement
with respect to such Underwritten Securities.
10. Survival of Representations and Agreements. All representations
and warranties, covenants and agreements of the Underwriters, the Company and
the Manager contained in this Agreement, including the agreements contained in
Section 4, the indemnity agreements contained in Section 6 and the
contribution agreements contained in Section 7, shall remain operative and in
full force and effect regardless of any investigation made by or on behalf of
any Underwriter or any controlling person thereof or by or on behalf of the
Company or the Manager, any of their respective officers, directors, partners
or members or any controlling person thereof, and shall survive delivery of
and payment for the Underwritten Securities to and by the Underwriters. The
representations contained in Section 1 and the agreements contained in this
Section 10 and Sections 4, 6 and 7 hereof shall survive the termination of
this Agreement and the applicable Terms Agreement, including termination
pursuant to Section 5 or 9 hereof.
11. Notices. All communications hereunder, except as may be otherwise
specifically provided herein, shall be in writing, and:
(a) if sent to any Underwriter, shall be mailed, delivered, or faxed
and confirmed in writing, to such Underwriter c/o Banc of America Securities
LLC, 0 Xxxx 00xx Xxxxxx, Xxx Xxxx,
00
Xxx Xxxx 00000, Attention: Xxxxx Xxxxxxxx, Assistant General Counsel, with a
copy to Sidley Austin LLP, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: J. Xxxxxx Xxxxxxx;
(b) if sent to the Company or the Manager, shall be mailed,
delivered, or faxed and confirmed in writing c/o Fortress Investment Group,
0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx X.
Xxxxxxx, Secretary, with a copy to Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, 0
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention: Xxxxx X. Xxxxxxxxxxx;
provided, however, that any notice to an Underwriter pursuant to Section 6
shall be delivered or sent by mail or facsimile transmission to such
Underwriter at its address set forth in its acceptance facsimile to you, which
address will be supplied to any other party hereto by you upon request. Any
such statements, requests, notices or agreements shall take effect at the time
of receipt thereof.
12. Parties. This Agreement and the applicable Terms Agreement shall
inure solely to the benefit of, and shall be binding upon, the Underwriters,
the Company and the Manager and the controlling persons, directors, officers,
employees and agents referred to in Sections 6 and 7, and their respective
successors and assigns, and no other person shall have or be construed to have
any legal or equitable right, remedy or claim under or in respect of or by
virtue of this Agreement or any provision herein contained. The term
"successors and assigns" shall not include a purchaser, in its capacity as
such, of Underwritten Securities from any of the Underwriters.
13. Governing Law. This Agreement and the applicable Terms Agreement
shall be governed by and construed in accordance with the laws of the State of
New York, but without regard to principles of conflicts of law.
14. Counterparts. This Agreement and the applicable Terms 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 instrument.
15. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement and the applicable Terms Agreement.
16. Time is of the Essence. Time shall be of the essence of this
Agreement and the applicable Terms Agreement. As used herein, the term
"business day" shall mean any day when the Commission's office in Washington,
D.C. is open for business.
[signature page follows]
33
If the foregoing correctly sets forth the understanding between you,
on the one hand, and the Company and the Manager, on the other hand, please so
indicate in the space provided below for that purpose, whereupon this letter
shall constitute a binding agreement among us.
Very truly yours,
NEWCASTLE INVESTMENT CORP.
By: /s/ Xxxxx X. Xxxx
-------------------------------------------
Name: Xxxxx X. Xxxx
Title: Chief Financial Officer
FORTRESS INVESTMENT GROUP LLC,
solely with respect to Sections 1(b), 3(b),
5(f), 5(g), 5(k)(ii), 10 and 12
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Operating Officer
Accepted as of the date first above written
BANC OF AMERICA SECURITIES LLC
By: /s/ Xxxxxxx X. Xxxx
---------------------------------------
Name: Xxxxxxx X. Xxxx
Title: Managing Director
2
