Common use of First Offering Clause in Contracts

First Offering. The Company hereby agrees that it shall conduct an Offering (the "First Offering") of such size as shall be determined by the Board of Trustees of the Company, provided that (i) the First Offering shall generate gross proceeds to the Company of at least $50,000,000 and (ii) the subscription price per share (the "First Subscription Price") of the Company's Shares of Beneficial Interest, $1.00 par value per share (the "Common Shares"), offered for sale in the First Offering shall be as follows: (a) if the Company commences the First Offering on or before April 23, 1999, then the First Subscription Price shall be $4.00 and (b) if the Company commences the First Offering after April 23, 1999, then the First Subscription Price shall be the lesser of: (1) $4.00; and (2) the average of the closing prices of the Common Shares on the New York Stock Exchange (the "NYSE") during the 10 consecutive trading days immediately preceding the date such Offering is commenced (the "Average Market Value"), less a discount equal to 5% of such Average Market Value (it being understood that the calculation made pursuant to this subclause (2) shall be rounded to the nearest one-sixteenth of $1.00). For purposes of this paragraph 2, the First Offering will be deemed to commence on the date the rights relating thereto are distributed. The Company further agrees that it shall provide the Standby Purchasers with five trading days' advance notice of the record date for the distribution of rights in the First Offering. The Company and the Standby Purchasers understand that the proceeds of the First Offering shall be used by the Company to repay amounts outstanding under the Loan Agreements, and for no other purpose; provided that the parties also understand that the lenders under the Loan Agreements shall extend the Aggregate Readvanced Loans (as defined in the Loan Agreements) to the Company following the application of the proceeds of the First Offering to enable the Company to repay $9,000,000 principal amount outstanding under the Company's senior credit facility.