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EXHIBIT 10.18
DEVELOPERS DIVERSIFIED REALTY CORPORATION
(an Ohio corporation)
MEDIUM-TERM NOTES
DUE 9 MONTHS OR MORE FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
August 31, 1999
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BANC OF AMERICA SECURITIES LLC
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
BANC ONE CAPITAL MARKETS, INC.
One First National Plaza
Chicago, Illinois 60670
▇▇▇▇▇▇▇, ▇▇▇▇▇ & CO.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ BROTHERS INC.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
WARBURG DILLON READ LLC ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
1. INTRODUCTORY. Developers Diversified Realty Corporation, an Ohio
corporation (the "Company"), confirms its agreement with ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated, Banc of America Securities LLC, Banc One Capital Markets, Inc.,
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co., ▇▇▇▇▇▇
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Brothers Inc., ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. and Warburg Dillon Read LLC (each, an
"Agent," and collectively, the "Agents") with respect to the issue and sale by
the Company of its debt securities denominated "Medium-Term Notes Due 9 Months
or More from Date of Issue" (the "Notes"). The Notes will be either Senior Notes
(the "Senior Notes") or Subordinated Notes (the "Subordinated Notes"). The
Senior Notes will be issued under an indenture dated as of May 1, 1994, as
amended, supplemented or modified from time to time (the "Senior Indenture"),
between the Company and National City Bank, as trustee (the "Senior Trustee"),
and the Subordinated Notes will be issued under an indenture dated as of May 1,
1994, as amended, supplemented or modified from time to time (the "Subordinated
Indenture"), between the Company and The Chase Manhattan Bank (formerly Chemical
Bank), as trustee (the "Subordinated Trustee"). The term "Trustee" as used
herein shall refer to either the Senior Trustee or the Subordinated Trustee, as
appropriate, for Senior Notes or Subordinated Notes. The Senior Indenture and
the Subordinated Indenture, each as amended, supplemented or modified from time
to time, are each sometimes referred to as the "Indenture." Each series of
Senior Notes or Subordinated Notes may vary, as applicable, as to aggregate
principal amount, maturity date, interest rate or formula and timing of payments
thereof, redemption and/or repayment provisions, and any other variable terms
which the Senior Indenture or the Subordinated Indenture, as the case may be,
contemplates may be set forth in the Senior Notes and the Subordinated Notes as
issued from time to time. The Senior Notes or the Subordinated Notes may be
offered either together or separately. As used herein, "Notes" shall mean the
Senior Notes or the Subordinated Notes or any combination thereof.
As of the date hereof, the Company has authorized the issuance and sale
of up to U.S. $400,000,000 aggregate initial offering price (or its equivalent,
based upon the applicable exchange rate at the time of issuance, in such foreign
or composite currencies as the Company shall designate at the time of issuance)
of Notes to or through the Agents pursuant to the terms of this Agreement. It is
understood, however, that the Company may from time to time authorize the
issuance of additional Notes and that such additional Notes may be sold to or
through the Agents pursuant to the terms of this Agreement, all as though the
issuance of such Notes were authorized as of the date hereof. This Agreement
provides both for the sale of Notes by the Company to one or more Agents as
principal for resale to investors and other purchasers and for the sale of Notes
by the Company directly to investors (as may from time to time be agreed to by
the Company and the applicable Agent), in which case such Agent will act as an
agent of the Company in soliciting purchases of the Notes.
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 Prospectus (as hereinafter
defined) as additional Agents with respect to the Notes.
2. APPOINTMENT AS AGENT. (a) Subject to the terms and conditions
stated herein and subject to the reservation by the Company of the right to
sell Notes directly on its own behalf, the Company hereby agrees that Notes
will be sold exclusively to or through the Agents. Notwithstanding anything to
the contrary contained herein, the Company may accept offers to purchase Notes
through an agent other than the Agents if (i) the Company shall not have
solicited such offers, (ii) the Company and such agent shall have entered into
an agreement with substantially the same terms as this Agreement (including
Schedule A) and (iii) the Company shall have notified the Agents promptly after
the acceptance of any such offer and shall have
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provided the Agents with a copy of such agreement in written form promptly
following the execution thereof.
(b) The Company shall not sell or approve the solicitation of
purchases of Notes in excess of the amount which shall be authorized by the
Company from time to time or in excess of the aggregate initial offering price
of Notes registered pursuant to the Registration Statement. The Agents shall
have no responsibility for maintaining records with respect to the aggregate
initial offering price of Notes sold, or of otherwise monitoring the
availability of Notes for sale, under the Registration Statement.
(c) The Agents shall not have any obligation to purchase Notes from
the Company as principal, but one or more Agents may agree from time to time to
purchase Notes as principal for resale to investors and other purchasers
determined by such Agent or Agents. Any such purchase of Notes by an Agent as
principal shall be made in accordance with Section 4(a) hereof.
(d) If agreed upon by an Agent and the Company, such Agent, acting
solely as agent for the Company and not as principal, will solicit purchases of
the Notes. Such Agent will communicate to the Company, orally, each offer to
purchase Notes solicited by it on an agency basis, other than those offers
rejected by such Agent. Such Agent shall have the right, in its reasonable
discretion, to reject any proposed purchase of Notes, as a whole or in part,
and any such rejection shall not be deemed a breach of its agreement contained
herein. The Company may accept or reject any proposed purchase of Notes, in
whole or in part. Such Agent shall make reasonable efforts to assist the
Company in obtaining performance by each purchaser whose offer to purchase
Notes has been solicited by it and accepted by the Company. Such Agent shall
not have any liability to the Company in the event that any such purchase is
not consummated for any reason. If the Company shall default on its obligation
to deliver Notes to a purchaser whose offer it has accepted, the Company shall
(i) hold such Agent harmless against any loss, claim or damage arising from or
as a result of such default by the Company, and (ii) notwithstanding such
default, pay to such Agent any commission to which it would otherwise be
entitled.
(e) The Company and the Agents agree that any Notes purchased by one
or more Agents as principal shall be purchased, and any Notes the placement of
which an Agent arranges as agent shall be placed by such Agent, in reliance on
the representations, warranties, covenants and agreements of the Company
contained herein and on the terms and conditions and in the manner provided
herein.
3. REPRESENTATIONS AND WARRANTIES. (a) The Company represents and
warrants to you, as of the date hereof, as of the date of each acceptance by
the Company of an offer for the purchase of Notes (whether to one or more
Agents as principal or through an Agent as agent), as of the date of each
delivery of Notes (whether to one or more Agents as principal or through an
Agent as agent) (the date of each such delivery to one or more Agents as
principal being hereinafter referred to as a "Settlement Date"), and as of any
time the Registration Statement (as defined below) or the Prospectus (as
defined below) shall be amended or supplemented or there is filed with the
Securities and Exchange Commission (the "Commission") any document incorporated
by reference into the Prospectus (as defined below) (each of the times
referenced above being referred to herein as a "Representation Date"), that:
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(i) A registration statement on Form S-3 (No. 333-72519) for
the registration of the Notes, under the Securities Act of 1933, as
amended (the "1933 Act"), and the offering thereof from time to time
in accordance with Rule 415 of the rules and regulations of the
Securities and Exchange Commission (the "Commission") under the 1933
Act (the "1933 Act Regulations"), has heretofore been delivered to
you, has been prepared by the Company in conformity with the
requirements of the 1933 Act and the 1933 Act Regulations and has been
filed with the Commission under the 1933 Act. The registration
statement (as amended, if applicable) has been declared effective by
the Commission and each of the Senior Indenture and the Subordinated
Indenture has been qualified under the Trust Indenture Act of 1939, as
amended (the "1939 Act"). Such registration statement (and any further
registration statements which may be filed by the Company for the
purpose of registering additional Notes and in connection with which
this Agreement is included or incorporated by reference as an
exhibit), on the one hand, and the prospectus constituting a part
thereof and any prospectus supplement and pricing supplement relating
to the offering of Notes, on the other hand, including all documents
incorporated therein by reference, as from time to time amended or
supplemented pursuant to the 1933 Act, the Securities Exchange Act of
1934, as amended (the "1934 Act") or otherwise, are referred to herein
as the "Registration Statement" and the "Prospectus," respectively,
except that if any revised prospectus shall be provided to the Agents
by the Company for use in connection with the offering of Notes,
whether or not such revised prospectus is required to be filed by the
Company pursuant to Rule 424(b) of the 1933 Act Regulations, the term
"Prospectus" shall refer to such prospectus from and after the time it
is first provided to the Agents for such use. If the Company elects to
rely on Rule 434 under the 1933 Act Regulations, all references to the
Prospectus shall be deemed to include, without limitation, the form of
prospectus and the term sheet, taken together, provided to the Agents
by the Company in reliance on Rule 434 under the 1933 Act (the "Rule
434 Prospectus"). If the Company files a registration statement to
register a portion of the 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 the
registration statement referred to above (No. 333-72519) 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
financial statements and schedules and other information which is
"contained," "included" or "stated" in the Registration Statement 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 or the Prospectus, as the case
may be; and all references in this Agreement to amendments or
supplements to the Registration Statement or the Prospectus shall be
deemed to mean and include, without limitation, the filing of any
document under the 1934 Act which is or is deemed to be incorporated
by reference in the Registration Statement or the Prospectus, as the
case may be.
(ii) At the time the Registration Statement became effective,
and at each time thereafter at which an Annual Report on Form 10-K was
filed by the Company with the Commission, the Registration Statement
and the Prospectus conformed, and as of each applicable Representation
Date will conform, in all material respects to the requirements
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of the 1933 Act, the 1933 Act Regulations and the 1939 Act. At the
time the Registration Statement became effective and at each time
thereafter at which an Annual Report on Form 10-K was filed by the
Company with the Commission, the Registration Statement did not, and
as of the applicable Representation Date, will not, contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading. The Prospectus, as of the date hereof does not, and as of
each applicable Representation Date will not, include an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the foregoing representations and warranties shall not
apply to information contained in or omitted from the Registration
Statement or the Prospectus in reliance upon, and in conformity with,
written information furnished to the Company by or on behalf of any
Agent, specifically for use in the preparation thereof or to that part
of the Registration Statement which shall constitute the Statement of
Eligibility under the 1939 Act (Form T-1) (the "Statement of
Eligibility") of the Senior Trustee and the Subordinated Trustee under
the Senior Indenture and the Subordinated Indenture.
(iii) The documents incorporated or deemed to be incorporated
by reference in the Prospectus pursuant to Item 12 of Form S-3 under
the 1933 Act, 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, at the
time the Registration Statement became effective and as of the
applicable Representation Date or during the period specified in
Section 5(e), 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 to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
(iv) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
otherwise stated therein, (A) there has not occurred any material
adverse change or any development that is reasonably likely to involve
a 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 from that
set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement), (B)
there have been no transactions entered into by the Company or its
subsidiaries which are material with respect to the Company and its
subsidiaries considered as one enterprise other than those in the
ordinary course of business, and (C) except for regular quarterly
dividends on the Company's common shares, and regular dividends
declared, paid or made in accordance with the terms of any class or
series of the Company's preferred shares, there has been no dividend
or distribution of any kind declared, paid or made by the Company on
any class of its capital stock.
(v) The consolidated financial statements and supporting
schedules of the Company included in, or incorporated by reference
into, the Registration Statement and
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the Prospectus present fairly the financial position of the Company
and its consolidated subsidiaries as of the dates indicated and the
results of their operations for the periods specified; except as
otherwise stated in the Registration Statement and the Prospectus,
said financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent
basis; and the supporting schedules included or incorporated by
reference in the Registration Statement and the Prospectus present
fairly in all material respects the information required to be stated
therein.
(vi) PricewaterhouseCoopers LLP, who have expressed their
opinion on the audited financial statements and related schedules
included in, or incorporated by reference into, the Registration
Statement, are independent public accountants within the meaning of
the 1933 Act and applicable 1933 Act Regulations.
(vii) The Company has been duly organized and is validly
existing and in good standing as a corporation under the laws of the
State of Ohio, with power and authority (corporate and other) to own,
lease and operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus; the
Company is in possession of and operating in compliance with all
material franchises, grants, authorizations, licenses, permits,
easements, consents, certificates and orders required for the conduct
of its business, all of which are valid and in full force and effect;
and the Company is duly qualified to do business and in good standing
as a foreign corporation in all other jurisdictions where its
ownership or leasing of properties or the conduct of its business
requires such qualification, except where failure to qualify and be in
good standing would not have a material adverse effect on the
condition, financial or otherwise, or on the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise.
(viii) Each Significant Subsidiary, as defined in Section
9(b)(iv), has been duly incorporated or formed and is validly existing
as a corporation, partnership or limited liability company in good
standing or in full force and effect under the laws of the
jurisdiction of its incorporation or formation, has corporate,
partnership or limited liability company power and authority to own,
lease and operate its properties and to conduct its business and is
duly qualified as a foreign corporation, partnership or limited
liability company to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify would not have a
material adverse effect on the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise.
(ix) The Indenture has been duly and validly authorized,
executed and delivered by the Company and constitutes the 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
enforcement of creditors' rights generally or by general equity
principles (regardless of whether enforcement is considered in a
proceeding in equity or at law).
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(x) The Notes have been duly authorized by the Company for
issuance and sale pursuant to this Agreement and, when issued,
authenticated and delivered pursuant to the provisions of the
Indenture against payment of the consideration therefor specified in
the Prospectus or agreed upon pursuant to the terms of this Agreement,
the Notes will constitute valid and legally binding obligations of the
Company, enforceable in accordance with their terms, except as
enforcement thereof may be limited by bankruptcy, insolvency or other
similar laws relating to or affecting enforcement of creditors' rights
generally or by general equity principles (regardless of whether
enforcement is considered in a proceeding in equity or at law); the
Notes and the Indenture conform in all material respects to all
statements relating thereto contained in the Prospectus; and the Notes
will be entitled to the benefits provided by the Indenture.
(xi) There is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now
pending, or, to the knowledge of the Company, threatened against or
affecting the Company or its subsidiaries, which is required to be
disclosed in the Prospectus (other than as disclosed therein), or
which might result in any material adverse change in the condition,
financial or otherwise, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, or might
materially and adversely affect the properties or assets thereof or
which might materially and adversely affect the consummation of this
Agreement, or the Indenture, or the transactions contemplated herein
and therein; all pending legal or governmental proceedings to which
the Company or any of its subsidiaries is a party or of which any of
their respective property is the subject which are not described in
the Prospectus, including routine litigation incidental to the
business, are, considered in the aggregate, not material; and there
are no material contracts or documents of the Company or its
subsidiaries which are required to be filed as exhibits to the
Registration Statement by the 1933 Act or by the 1933 Act Regulations
which have not been so filed.
(xii) Neither the Company nor any of its subsidiaries is in
violation of its respective articles of incorporation or other
organizational document (the "Articles of Incorporation"), or its Code
of Regulations or bylaws, as the case may be (the "Code of
Regulations"), or in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which it is a party or by which it or its properties may
be bound, where such defaults in the aggregate would have a material
adverse effect on the condition, financial or otherwise, or on the
earnings, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise; and the execution and
delivery of this Agreement and the Indenture, and the consummation of
the transactions contemplated herein and therein have been duly
authorized by all necessary corporate action, and compliance by the
Company with its obligations hereunder and thereunder will not
conflict with or constitute a breach of, or default under, or result
in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or its subsidiaries pursuant to,
any contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which the Company or any of its subsidiaries is a
party or by which it may be bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject, nor will
such action result in any violation of the provisions of the Articles
of Incorporation or
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Code of Regulations of the Company or any of its subsidiaries or, to
the best of its knowledge, any law, administrative regulation or
administrative or court order or decree; and no consent, approval,
authorization or order of any court or governmental authority or
agency is required for the consummation by the Company of the
transactions contemplated by this Agreement or the Indenture, except
such as has been obtained or as may be required under the 1933 Act,
the 1934 Act, state securities or Blue Sky laws or real estate
syndication laws in connection with the purchase and distribution of
the Notes by the Agents.
(xiii) The Company has full right, power and authority to
enter into this Agreement, and this Agreement has been, and as of the
applicable Representation Date will have been, duly authorized,
executed and delivered by the Company.
(xiv) With respect to its taxable year ended December 31,
1993 and its taxable years ending thereafter, the Company has operated
and will continue to operate so as to qualify as a real estate
investment trust ("REIT"), the Company qualified as a REIT for its
taxable years ended December 31, 1993, 1994, 1995, 1996 and 1997 and
the Company intends to make a timely election to be taxed as a REIT
with respect to its current taxable year.
(xv) Neither the Company nor any of its subsidiaries is
required to be registered as an investment company under the
Investment Company Act of 1940, as amended (the "1940 Act").
(xvi) Neither the Company nor any of its subsidiaries is
required to own or possess any trademarks, service marks, trade names
or copyrights in order to conduct the business now operated by them.
(xvii) If applicable, the Notes have been approved for
listing on the New York Stock Exchange.
(xviii) There are no persons with registration or other
similar rights to have any securities registered pursuant to the
Registration Statement.
(xix) (A) The Company or its subsidiaries have good and
marketable title or leasehold interest, as the case may be, to the
portfolio properties (the "Portfolio Properties") described in the
Prospectus (or documents incorporated by reference therein) as being
owned by the Company or its subsidiaries (except with respect to
properties described in the Prospectus or documents incorporated by
reference therein) as being held by the Company through joint
ventures, in each case free and clear of all liens, encumbrances,
claims, security interests and defects (collectively, the "Defects"),
except such as do not materially adversely affect the value of such
property or interests and do not materially interfere with the use
made and proposed to be made of such property or interests by the
Company or such subsidiaries, as the case may be; (B) the joint
venture interest in each property described in the Prospectus (or
documents incorporated by reference therein) as being held by the
Company through a joint venture, is owned, free and clear of all
Defects except for such Defects that will not have a material adverse
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effect on the business, earnings or business prospects of the Company
and its subsidiaries considered as one enterprise; (C) all liens,
charges, encumbrances, claims, or restrictions on or affecting the
properties and assets of the Company or its subsidiaries which are
required to be disclosed in the Prospectus are disclosed therein; (D)
none of the Company, its subsidiaries or, to the best of the Company's
knowledge, any lessee of any of the Portfolio Properties is in default
under any of the leases governing the Portfolio Properties and the
Company does not know of any event which, but for the passage of time
or the giving of notice, or both, would constitute a default under any
of such leases, except such defaults that would not have a material
adverse effect on the condition, financial or otherwise, or on the
earnings, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise; (E) no tenant under any
of the leases pursuant to which the Company or its subsidiaries leases
any of the Portfolio Properties has an option or right of first
refusal to purchase the premises demised under such lease (except for
(i) Kmart Corporation, (ii) the tenants at the Solon outlot Portfolio
Property located in Solon, Ohio, (iii) as otherwise described in the
Prospectus (or documents incorporated by reference therein) and (iv)
such other options or rights of first refusal that, if exercised,
would not have a material adverse effect on the condition, financial
or otherwise, or on the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise); (F) each of the Portfolio Properties complies with all
applicable codes and zoning laws and regulations, except for such
failures to comply which would not individually or in the aggregate
have a material adverse effect on the condition, financial or
otherwise, or on the earnings, business affairs or business prospects
of the Company and its subsidiaries considered as one enterprise; and
(G) the Company does not have knowledge of any pending or threatened
condemnation, zoning change, or other proceeding or action that will
in any manner affect the size of, use of, improvements on,
construction on, or access to the Portfolio Properties, except such
proceedings or actions that would not have a material adverse effect
on the condition, financial or otherwise, or on the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise.
(xx) The Company or its subsidiaries have title insurance on
each of the Portfolio Properties (except with respect to each property
described in the Prospectus (or documents incorporated by reference
therein) as held by the Company through a joint venture) in an amount
at least equal to the greater of (A) the cost of acquisition of such
Portfolio Property and (B) the cost of construction of the
improvements located on such Portfolio Property, except, in each case,
where the failure to maintain such title insurance would not have a
material adverse effect on the condition, financial or otherwise, or
on the earnings, business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise; the joint venture
owning each property described in the Prospectus (or documents
incorporated by reference therein) as held by the Company through a
joint venture has title insurance on such property in an amount at
least equal to the greater of (A) the cost of acquisition of such
Portfolio Property by such joint venture and (B) the cost of
construction of the improvements located on such Portfolio Property,
except, in each case, where the failure to maintain such title
insurance would not have a material adverse effect on the condition,
financial or otherwise, or on the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as
one enterprise.
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(xxi) The mortgages and deeds of trust encumbering the
Portfolio Properties are not convertible and neither the Company nor
any of its subsidiaries hold a participating interest therein and said
mortgages and deeds of trust are not cross-defaulted or
cross-collateralized to any property not owned by the Company or its
subsidiaries.
(xxii) The Company has no knowledge of (a) the unlawful
presence of any hazardous substances, hazardous materials, toxic
substances or waste materials (collectively, "Hazardous Materials") on
any of the Portfolio Properties or of (b) any unlawful spills,
release, discharges or disposal of Hazardous Materials that have
occurred or are presently occurring from the Portfolio Properties as a
result of any construction on or operation and use of the Portfolio
Properties, which presence or occurrence would materially adversely
affect the condition, financial or otherwise, or the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise. In connection with the
construction on or operation and use of the Portfolio Properties, the
Company represents that, as of the date of this Agreement, the Company
has no knowledge of any material failure to comply with all applicable
local, state and federal environmental laws, regulations, ordinances
and administrative and judicial orders relating to the generation,
recycling, reuse, sale, storage, handling, transport and disposal of
any Hazardous Materials that would have a material adverse effect on
the condition, financial or otherwise, or on the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise.
(xxiii) The Senior Notes are rated not less than Baa2 by
▇▇▇▇▇'▇ Investors Service, Inc. ("Moody's") and BBB by Standard &
Poor's, a division of the ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. ("S&P"). The
Subordinated Notes are rated not less than Baa3 by Moody's and BBB- by
S&P.
(b) Any certificate signed by any officer of the Company and delivered
to you or to counsel for the Agents shall be deemed a representation and
warranty by the Company, as the case may be, to each Agent participating in
such offering as to the matters covered thereby on the date of such certificate
and, unless subsequently amended or supplemented, at the applicable
Representation Date subsequent thereto.
4. PURCHASES AS PRINCIPAL; SOLICITATIONS AS AGENT. (a) Unless
otherwise agreed by an Agent and the Company, Notes shall be purchased by such
Agent as principal. Such purchases shall be made in accordance with terms
agreed upon by one or more Agents and the Company (which terms, unless
otherwise agreed, shall, to the extent applicable, include those terms
specified in Exhibit A hereto and be agreed upon orally, with written
confirmation prepared by such Agent or Agents and mailed to the Company). An
Agent's commitment to purchase Notes as principal shall be deemed to have been
made on the basis of the representations and warranties of the Company herein
contained and shall be subject to the terms and conditions herein set forth.
Unless the context otherwise requires, references herein to "this Agreement"
shall include the agreement of one or more Agents to purchase Notes from the
Company as principal. Each purchase of Notes, unless otherwise agreed, shall be
at a discount from the principal amount of each such Note equivalent to the
applicable commission set forth in Schedule A hereto. The Agents may engage the
services of any other broker or dealer in connection with the resale of the
Notes purchased by them as principal and may allow any portion of the discount
received in
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connection with such purchases from the Company to such brokers and dealers. At
the time of each purchase of Notes by one or more Agents as principal, such
Agent or Agents shall specify the requirements for the stand-off agreement,
officers' certificate, comfort letter and opinions of counsel pursuant to
Sections 5(k), 11(b), 11(c), and 11(d) hereof.
(b) On the basis of the representations and warranties herein
contained, but subject to the terms and conditions herein set forth, when
agreed by the Company and an Agent, such Agent, as an agent of the Company,
will use its reasonable efforts to solicit offers to purchase the Notes upon
the terms and conditions set forth herein and in the Prospectus. The Agents are
not authorized to appoint sub-agents with respect to Notes sold through them as
agent. All Notes sold through an Agent as agent will be sold at 100% of their
principal amount unless otherwise agreed to by the Company and such Agent.
The Company reserves the right, in its sole discretion, to suspend
solicitation of purchases of the Notes through an Agent, as agent, commencing at
any time for any period of time or permanently. As soon as practicable after
receipt of instructions from the Company, such Agent will suspend solicitation
of purchases from the Company until such time as the Company has advised such
Agent that such solicitation may be resumed.
The Company agrees to pay each Agent a commission, in the form of a
discount, equal to the applicable percentage of the principal amount of each
Senior Note sold by the Company as a result of a solicitation made by such Agent
as set forth in Schedule A hereto. The schedule of commissions payable in
connection with sales of Senior Notes will also apply to sales of Subordinated
Notes unless otherwise agreed to by the Company and the applicable Agent.
(c) The purchase price, interest rate or formula, maturity date and other terms
of the Notes (as applicable) specified in Exhibit A hereto shall be agreed upon
by the Company and the applicable Agent or Agents and specified in a pricing
supplement to the Prospectus (each, a "Pricing Supplement") to be prepared in
connection with each sale of Notes. Except as may be otherwise specified in the
applicable Pricing Supplement, the Notes will be issued in denominations of U.S.
$1,000 or any larger amount that is an integral multiple of U.S. $1,000.
Administrative procedures with respect to the sale of Notes shall be agreed upon
from time to time by the Company, the Agents and the Trustees (the
"Procedures"). The Agents and the Company agree to perform, and the Company
agrees to cause the Trustees to agree to perform, their respective duties and
obligations specifically provided to be performed by them in the Procedures.
5. COVENANTS AND AGREEMENTS OF THE COMPANY. The Company covenants with
the Agents participating in the offering of Notes that:
(a) The Company will notify the Agents immediately, and confirm such
notice in writing, of (i) the effectiveness of any amendment to the
Registration Statement, (ii) the transmittal to the Commission for filing of
any amendment or supplement to the Prospectus or any document to be filed
pursuant to the 1934 Act (other than any amendment, supplement or document
relating solely to securities other than the Notes), (iii) the receipt of any
comments from the Commission with respect to the Registration Statement or the
Prospectus, (iv) any request by the Commission for any amendment to the
Registration Statement or any amendment
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or supplement to the Prospectus or for additional information, (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 (vi) any change in the rating assigned by any nationally recognized
statistical rating organization to any debt securities of the Company or the
public announcement by any nationally recognized statistical rating
organization that it has under surveillance or review, with possible negative
implications, its rating of any debt securities of the Company. The Company
will use all commercially reasonable efforts 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.
(b) The Company will give the Agents advance notice of its intention
to file or prepare any additional registration statement with respect to the
registration of additional Notes, any amendment to the Registration Statement
or any amendment or supplement to the Prospectus (other than an amendment or
supplement providing solely for a change in the interest rate or formula
applicable to the Notes or a change relating solely to securities other than
the Notes), whether by the filing of documents pursuant to the 1934 Act or the
1933 Act or otherwise, and will furnish to Brown & Wood LLP, counsel for the
Agents copies of any such amendment or supplement or other documents proposed
to be filed or used a reasonable time in advance of 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 the Agents or counsel for the Agents shall
reasonably object.
(c) The Company will deliver to the Agent 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 by reference in the Prospectus) as
the Agents reasonably request. The Company will furnish to the Agents as many
copies of the Prospectus (as amended or supplemented) as the Agents reasonably
request so long as the Agents are required to deliver a Prospectus in
connection with sales or solicitations of offers to purchase the Notes.
(d) The Company will prepare, with respect to any Notes to be sold to
or through one or more Agents pursuant to this Agreement, a Pricing Supplement
with respect to such Notes in a form previously approved by the Agents and will
file such Pricing Supplement pursuant to Rule 424(b) under the 1933 Act not
later than the close of business of the Commission on the first business day
after the date on which such Pricing Supplement is first used.
(e) Except as otherwise provided in subsection (l) of this Section 5,
if at any time during the term of this Agreement any event shall occur or
condition exist as a result of which it is necessary, in the opinion of counsel
for the Agents 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 the Prospectus is delivered to a purchaser, or if it shall
be necessary, in the opinion of either such counsel, 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, the Company shall
give immediate notice, confirmed in writing, to the Agents to cease the
solicitation of offers to purchase the Notes in an Agent's capacity as agent
and to cease sales of any Notes an Agent may then own as
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principal, and the Company will promptly amend the Registration Statement and
the Prospectus, whether by filing documents pursuant to the 1934 Act or the
1933 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 Agents a reasonable number of
copies of such amendment or supplement.
(f) Except as otherwise provided in subsection (l) of this Section 5,
on or prior to the date on which there shall be released to the general public
interim financial statement information related to the Company with respect to
each of the first three quarters of any fiscal year or preliminary financial
statement information with respect to any fiscal year, the Company shall
furnish such information to the Agents, confirmed in writing, and shall cause
the Prospectus to be amended or supplemented to include or incorporate by
reference financial information with respect thereto and corresponding
information for the comparable period of the preceding fiscal year, as well as
such other information and explanations as shall be necessary for an
understanding thereof or as shall be required by the 1933 Act or the 1933 Act
Regulations.
(g) Except as otherwise provided in subsection (l) of this Section 5,
on or prior to the date on which there shall be released to the general public
financial information included in or derived from the audited financial
statements of the Company for the preceding fiscal year, the Company shall
furnish such information to the Agents, confirmed in writing, and shall cause
the Registration Statement and the Prospectus to be amended, whether by the
filing of documents pursuant to the 1934 Act or the 1933 Act or otherwise, to
include or incorporate by reference such audited financial statements and the
report or reports, and consent or consents to such inclusion or incorporation
by reference, of the independent accountants with respect thereto, as well as
such other information and explanations as shall be necessary for an
understanding of such financial statements or as shall be required by the 1933
Act or the 1933 Act Regulations.
(h) 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 each twelve month
period beginning, in each case, 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 with respect to each sale of Notes.
(i) The Company will endeavor, in cooperation with the Agents, to
qualify the Notes for offering and sale under the applicable securities laws,
if any such laws are applicable, and real estate syndication laws, if any such
laws are applicable, of such states and other jurisdictions of the United
States as the Agents may designate, and will maintain such qualifications in
effect for as long as may be required for the distribution of the Notes;
PROVIDED, HOWEVER, that the Company shall not be obligated to file any general
consent to service of process or to qualify as a foreign corporation in any
jurisdiction in which it is not so qualified. The Company will file such
statements and reports as may be required by the laws of each jurisdiction in
which the Notes have been qualified as above provided. The Company will
promptly advise the Agents of the receipt by the Company of any notification
with respect to the suspension of the qualification of the Notes for sale in
any such state or jurisdiction or the initiating or threatening of any
proceeding for such purpose.
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(j) The Company, during the period when the Prospectus is required to
be delivered under the 1933 Act or the 1934 Act in connection with sales of the
Notes, will file all documents required to be filed with the Commission
pursuant to Sections 13, 14 or 15 of the 1934 Act within the time periods
prescribed by the 1934 Act and the 1934 Act Regulations.
(k) If specified by the applicable Agent or Agents in connection with
a purchase of Notes as principal, between the date of the agreement to purchase
such Notes and the Settlement Date with respect to such purchase, the Company
will not, without the prior written consent of such Agent or Agents, offer or
sell, grant any option for the sale of, or enter into any agreement to sell,
any debt securities of the Company (other than the Notes that are to be sold
pursuant to such agreement and commercial paper in the ordinary course of
business).
(l) The Company shall not be required to comply with the provisions of
subsections (e), (f) or (g) of this Section 5 for any period during which (i)
the Agents have not agreed with the Company to solicit purchases of Notes in
accordance with Section 2(d) or have suspended such solicitation and (ii) no
Agent is holding any Notes purchased as principal pursuant hereto, until the
time the Agents have agreed with the Company to solicit such purchases of the
Notes or have resumed solicitation in accordance with Section 2(d) or an Agent
shall subsequently purchase Notes from the Company as principal.
(m) The Company will use its best efforts to meet the requirements to
qualify as a REIT under the Internal Revenue Code of 1986, as amended (the
"Code") for the taxable year in which sales of the Notes are to occur, unless
otherwise specified in the Prospectus.
6. PAYMENT OF EXPENSES. The Company will pay, directly or by
reimbursement, all expenses incident to the performance of its obligations
under this Agreement, including (i) the preparation and filing of the
Registration Statement and all amendments thereto and the Prospectus and any
amendments or supplements thereto; (ii) the preparation, filing and
reproduction of this Agreement; (iii) the preparation, printing, issuance and
delivery of the Notes, including any fees and expenses relating to the use of
Notes in book-entry form; (iv) the fees and disbursements of the Company's
accountants and counsel, of the Trustee and its counsel, and of any calculation
agent or exchange rate agent; (v) the reasonable fees and disbursements of
Brown & Wood LLP, counsel to the Agents, incurred in connection with the
establishment of the program relating to the Notes and incurred from time to
time in connection with the transactions contemplated hereby; (vi) the
qualification of the Notes under state securities laws in accordance with the
provisions of Section 5(i) hereof, including filing fees and the reasonable
fees and disbursements of Brown & Wood LLP, counsel for the Agents in
connection therewith and in connection with the preparation of any blue sky or
legal investment survey; (vii) the printing and delivery to the Agents in
quantities as hereinabove stated of copies of the Registration Statement and
any amendments thereto, and of the Prospectus and any amendments or supplements
thereto, and the delivery by the Agents of the Prospectus and any amendments or
supplements thereto in connection with solicitations or confirmations of sales
of the Notes; (viii) the preparation, reproduction and delivery to the Agents
of copies of the Indenture and all supplements and amendments thereto; (ix) any
fees charged by rating agencies for the rating of the Notes; (x) the fees and
expenses incurred in connection with any listing of Notes on a securities
exchange; (xi) the fees and expenses incurred with respect to any filing with
the National Association of Securities Dealers, Inc.; (xii) any advertising and
other out-of-
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pocket expenses of the Agents incurred with the approval of the Company; and
(xiii) the cost of providing any CUSIP or other identification numbers for the
Notes.
7. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to
indemnify and hold harmless each Agent and each person, if any, who controls
any Agent within the meaning of either Section 15 of the 1933 Act or Section 20
of the 1934 Act from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement or any amendment
thereof, any preliminary prospectus or the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information relating to any Agent
furnished to the Company in writing by such Agent through you expressly for use
therein.
(b) Each Agent agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act
to the same extent as the foregoing indemnity from the Company to such Agent,
but only with reference to information relating to such Agent furnished to the
Company in writing by such Agent through you expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 7(a) or 7(b), such person (the "indemnified party")
shall promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of
the indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of
both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to one firm serving as local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be designated in writing by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
Co. Incorporated, in the case of parties indemnified pursuant to Section 7(a),
and by the Company, in the case of parties indemnified pursuant to Section
7(b). The indemnifying party shall not be liable for any settlement of any
proceeding
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effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of counsel as
contemplated by the second and third sentences of this paragraph, the
indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed
the indemnified party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
(d) To the extent the indemnification provided for in Section 7(a) or
7(b) is unavailable to an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Agents on the other
hand from the offering of the Notes or (ii) if the allocation provided by
clause 7(d)(i) above is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in clause
7(d)(i) above but also the relative fault of the Company on the one hand and of
the Agents on the other hand in connection with the statements or omissions
that resulted in such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Agents on the other hand in connection with the
offering of the Notes shall be deemed to be in the same respective proportions
as the net proceeds from the offering of the Notes (before deducting expenses)
received by the Company and the total commissions received by the Agents. The
relative fault of the Company on the one hand and the Agents on the other hand
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company or by
the Agents and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Agents'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the respective number of Notes they have purchased hereunder, and
not joint.
(e) The Company and the Agents agree that it would not be just or
equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the Agents were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in Section 7(d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified
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party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, no Agents shall be required
to contribute any amount in excess of the amount by which the total price at
which the Notes purchased by it or through it and distributed to the public
were offered to the public exceeds the amount of any damages that such Agent
has otherwise been required to pay by reason of 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 1933 Act) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The remedies provided for in this Section 7 are
not exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this
Section 7 and the representations, warranties and other statements of the
Company contained in this Agreement shall remain operative and in full force
and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Agent or any person controlling any
Agent or by or on behalf of the Company, its officers or directors or any
person controlling the Company and (iii) acceptance of and payment for any of
the Notes.
8. SURVIVAL OF INDEMNITIES, REPRESENTATIONS, WARRANTIES, ETC. The
respective indemnities, covenants, agreements, representations, warranties and
other statements of the Company and the Agents, as set forth in this Agreement
or certificates of officers of the Company submitted pursuant hereto or
thereto, shall remain in full force and effect, regardless of any investigation
made by or on behalf of any Agent or the Company or any of their officers or
directors or any controlling person, and shall survive delivery of and payment
for the Notes.
9. CONDITIONS OF AGENTS' OBLIGATIONS. The respective obligations of
the Agents to purchase Notes as agent of the Company, and the obligations of
any purchasers of the Notes sold through an Agent as agent, are subject to the
accuracy of the representations and warranties made herein by the Company, to
the accuracy of the statements of the Company's officers or directors in any
certificate furnished in connection therewith pursuant to the provisions
hereof, to the performance and observance by the Company of all of its
covenants and agreements herein contained and other provisions hereof to be
satisfied in connection therewith, and to the following additional conditions:
(a) On the date hereof, you shall have received from
PricewaterhouseCoopers LLP a letter, dated as of the date hereof and
in form and substance satisfactory to you, to the effect that:
(i) they are independent accountants with respect to
the Company and its subsidiaries within the meaning of the
1933 Act and the 1933 Act Regulations; (ii) it is their
opinion that the consolidated financial statements and
supporting schedules of the Company included or incorporated
by reference in the Registration Statement and the Prospectus
and covered by their opinions therein comply in form in all
material respects with the applicable accounting requirements
of the 1933 Act and the 1934 Act, and the related published
rules and regulations; (iii) it is their opinion that the
financial statements of the properties acquired or proposed
to be acquired by the Company included in the
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Company's Current Reports on Form 8-K (the "Forms 8-K") dated
February 25, 1998 and filed on April 7, 1998, as amended on
April 23, 1998, and dated April 28, 1998 and filed on June
24, 1998, each of which is incorporated by reference in the
Company's Registration Statement and covered by their
opinions therein comply as to form in all material respects
with the applicable accounting requirements of the 1933 Act
and the 1934 Act with respect to real estate operations
acquired or to be acquired; (iv) they have performed limited
procedures, not constituting an audit, including a reading of
the latest available unaudited interim consolidated financial
statements of the Company and its subsidiaries, a reading of
the minute books of the Company and its subsidiaries,
inquiries of certain officials of the Company and its
subsidiaries who have responsibility for financial and
accounting matters and such other inquiries and procedures as
may be specified in such letter, and on the basis of such
limited review and procedures nothing came to their attention
that caused them to believe that (A) the unaudited interim
consolidated financial statements and financial statement
schedules, if any, of the Company included or incorporated by
reference in the Registration Statement and the Prospectus do
not comply as to form in all material respects with the
applicable accounting requirements of the 1934 Act and the
related published rules and regulations thereunder or that
any material modification should be made to the unaudited
condensed interim financial statements included in or
incorporated by reference in the Registration Statement and
the Prospectus for them to be in conformity with generally
accepted accounting principles, (B) the unaudited pro forma
condensed financial statements included in the Company's
aforementioned Forms 8-K, and the Company's Forms 8-K dated
September 10, 1998 and filed on December 8, 1998, and dated
April 23, 1999 and filed on August 20, 1999, do not comply as
to form in all material respects with the applicable
accounting requirements of Rule 11-02 of Regulation S-X under
the 1933 Act or that the pro forma adjustments have not been
properly applied to the historical amounts in the compilation
of such statements, (C) the information included or
incorporated by reference in the Registration Statement and
the applicable Prospectus under the caption "Selected
Consolidated Financial Data" did not conform in all material
respects with the disclosure requirements of item 301 of
Regulation S-K, or (D) at a specified date not more than
three days prior to the date of such letter, there has been
any change in the capital stock of the Company or in the
consolidated long term debt of the Company or any decrease in
the net assets of the Company, as compared with the amounts
shown in the most recent consolidated balance sheet included
or incorporated by reference in the Registration Statement
and the Prospectus or, during the period from the date of the
most recent consolidated statement of operations of the
Company included or incorporated by reference in the
Registration Statement and the Prospectus to a specified date
not more than three days prior to the date of such letter,
there were any decreases, as compared with the corresponding
period in the preceding year, in consolidated revenues, or
decrease in consolidated net income or consolidated net
income per share of the Company, except in all instances for
changes, increases or decreases which the Registration
Statement and the Prospectus disclose have occurred or may
occur;
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and (v) in addition to the audit referred to in their
opinions and the limited procedures referred to in clause
(iv) above, they have carried out certain specified
procedures, not constituting an audit, with respect to
certain amounts, percentages and financial information which
are included or incorporated by reference in the Registration
Statement and the Prospectus and which are specified by you,
and have found such amounts, percentages and financial
information to be in agreement with the relevant accounting,
financial and other records of the Company and its
subsidiaries identified in such letter.
(b) On the date hereof, you shall have received from ▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇ LLP, counsel for the Company, an opinion, dated as of the
date hereof, to the effect that:
(i) The Company has been duly organized and is
validly existing as a corporation in good standing under the
laws of the State of Ohio.
(ii) The Company has all requisite corporate power
and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus.
(iii) The Company is duly qualified to transact
business and is in good standing in each jurisdiction in
which it owns real property except where the failure to
qualify and be in good standing would not have a material
adverse effect on the condition, financial or otherwise, of
the Company and its subsidiaries considered as one
enterprise.
(iv) If the Company has one or more significant
subsidiaries, as defined in Rule 405 of the 1933 Act (each a
"Significant Subsidiary"), each Significant Subsidiary has
been duly incorporated or formed and is validly existing as a
corporation, partnership or limited liability company in good
standing or in full force and effect under the laws of the
jurisdiction of its incorporation or formation, has
corporate, partnership or limited liability company power and
authority to own, lease and operate its properties and to
conduct its business, and is duly qualified as a foreign
corporation, partnership or limited liability company to
transact business and is in good standing in each
jurisdiction in which it owns real property, except where the
failure to so qualify and be in good standing would not have
a material adverse effect on the condition, financial or
otherwise, of the Company and its Subsidiaries considered as
one enterprise.
(v) The Notes have been duly and validly authorized
by all necessary corporate action on the part of the Company
and, when the terms of the Notes and of their issue and sale
have been duly established in accordance with the applicable
Indentures and this Agreement so as not to violate any
applicable law or agreement or instrument then binding on the
Company, and when the Notes have been executed, authenticated
and delivered by the Company pursuant to the provisions of
this Agreement, and the Indentures against payment of the
consideration therefor, the Notes will constitute valid and
legally binding
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obligations of the Company entitled to the benefits provided
by the Indentures and enforceable in accordance with their
terms.
(vi) This Agreement has been duly authorized,
executed and delivered by the Company.
(vii) Each Indenture has been duly and validly
authorized, executed and delivered by the Company and
(assuming due authorization, execution and delivery by the
Trustee and the validity, legality, binding effect on and
enforceability against the Trustee) constitutes the valid and
legally binding agreement of the Company, enforceable in
accordance with its terms; provided that no opinion is
rendered in this paragraph herein with respect to the
enforceability of the choice of law provisions in the
Indentures.
(viii) Each Indenture has been duly qualified under
the 1939 Act.
(ix) The Registration Statement is effective under
the 1933 Act and, to the best of their knowledge, no stop
order suspending the effectiveness of the Registration
Statement has been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission.
(x) The Registration Statement and the Prospectus
(other than the financial statements, related schedules and
other financial and statistical data included or incorporated
by reference in the Registration Statement or the Prospectus,
as to which no opinion need be rendered) as of their
respective effective or issue dates, comply as to form in all
material respects with the requirements for registration
statements on Form S-3 under the 1933 Act and the 1933 Act
Regulations. If applicable, the Rule 434 Prospectus conforms
to the requirements of Rule 434 of the 1933 Act Regulations
in all material respects.
(xi) Each document filed pursuant to the 1934 Act
(other than the financial statements, related schedules and
other financial and statistical data included therein, as to
which no opinion need be rendered) and incorporated or deemed
to be incorporated by reference in the Prospectus complied
when so filed as to form in all material respects with the
1934 Act and the 1934 Act Regulations.
(xii) Nothing has come to such counsel's attention
that would lead it to believe that the Registration Statement
or any amendment thereto (other than the financial
statements, related schedules and other financial and
statistical information included or incorporated by reference
therein, as to which such counsel need express no belief), at
the time it became effective or at the time an Annual Report
on Form 10-K was filed by the Company with the Commission
(whichever is later), or at the date hereof (or, if such
opinion is being delivered in connection with the purchase of
Notes by one or more Agents as principal pursuant to Section
11(c) hereof, at the date of any agreement by such Agent or
Agents to purchase Notes as principal), contained or contains
an untrue statement
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of a material fact or omitted or omits to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus or
any amendment or supplement thereto (other than the financial
statements, related schedules and other financial and
statistical data therein, as to which such counsel need
express no belief), at the date hereof (or, if such opinion
is being delivered in connection with the purchase of Notes
by one or more Agents as principal pursuant to Section 11(c)
hereof, at the date of any agreement by such Agent or Agents
to purchase Notes as principal and at the Settlement Date
with respect thereto, as the case may be), included or
includes an untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading.
(xiii) To their knowledge, there are no legal or
governmental proceedings pending or threatened which are
required to be disclosed in the Prospectus, other than those
disclosed therein, and, to their knowledge, all pending legal
or governmental proceedings to which the Company or its
Significant Subsidiaries is a party or of which any of the
property of the Company or its subsidiaries is the subject
which are not described in the Registration Statement,
including ordinary routine litigation incidental to the
business, are, considered in the aggregate, not material to
the business of the Company and its subsidiaries considered
as one enterprise.
(xiv) To their knowledge, there are no contracts,
indentures, mortgages, loan agreements, notes, leases or
other instruments required to be described or referred to in
the Registration Statement or to be filed as exhibits thereto
other than those described or referred to therein or filed as
exhibits thereto, the summaries thereof or references thereto
are correct in all material respects.
(xv) No authorization, approval or consent of any
court or governmental authority or agency is required that
has not been obtained in connection with the transactions
contemplated by this Agreement, except such as may be
required under the 1933 Act, the 1934 Act, and state
securities laws or Blue Sky laws or real estate syndication
laws; to their knowledge, the execution and delivery of this
Agreement and the consummation of the transactions
contemplated herein and therein and compliance by the Company
with its obligations hereunder and thereunder will not (A)
constitute a breach of, or 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 Significant
Subsidiary pursuant to any contract, indenture, mortgage,
loan agreement, note, lease or other instrument to which the
Company or any Significant Subsidiary is a party or by which
they may be bound or to which any of the property or assets
of the Company or any Significant Subsidiary is subject,
except where such breach, default, creation or imposition
would not have a material adverse effect on the condition,
financial or otherwise, or (B) result in violation of the
provisions of the Articles of Incorporation, Partnership
Agreement, Code of Regulations or
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Operating Agreement of the Company or subsidiaries or any
applicable law, administrative regulation or administrative
or court order or decree.
(xvi) Neither the Company nor any Significant
Subsidiary is required to be registered as an investment
company under the 1940 Act.
(xvii) The statements in the Prospectus, if any,
under the captions "Certain Anti-Takeover Provisions of Ohio
Law," "Certain Federal Income Tax Considerations" and
"Federal Income Tax Considerations," to the extent that they
constitute matters of law or legal conclusions, have been
reviewed by them and such statements or summaries are correct
in all material respects.
(xviii) The Company has qualified as a REIT for its
taxable years ended December 31, 1993, 1994, 1995, 1996 and
1997 and the Company is organized and operates in a manner
that will enable it to qualify to be taxed as a REIT under
the Code for the taxable years ended December 31, 1998 and
thereafter provided the Company continues to meet the asset
composition, source of income, shareholder diversification,
distributions, record keeping, and other requirements of the
Code which are necessary for the Company to qualify as a
REIT.
(xix) The choice of law provisions in the Senior
Indenture are enforceable in accordance with their terms.
(xx) To their knowledge, no default exists in the
due performance or observance of any material obligation,
agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other
instrument described or referred to in the Registration
Statement or filed as an exhibit thereto which would have a
material adverse effect on the condition, financial or
otherwise, or on the earnings or business affairs of the
Company and its subsidiaries considered as one enterprise.
(c) On the date hereof, you shall have received from Brown &
Wood LLP, counsel for the Agents, their opinion or opinions dated as
of the date hereof with respect to the matters set forth in (i), (v)
to (x), inclusive, and (xii) of subsection (b) of this Section 9, and
the Company shall have furnished to such counsel such documents as
they may request for the purpose of enabling them to pass upon such
matters.
In giving their opinion, ▇▇▇▇▇ & Wood LLP may rely as to
matters involving the laws of the State of Ohio upon the opinion of
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP. In giving their opinion, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP
may rely as to matters involving the laws of the State of New York upon
the opinion of ▇▇▇▇▇ & Wood llp. ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP and Brown & Wood
LLP may rely (i) as to the qualification of the Company or its
subsidiaries to do business in any state or jurisdiction, upon
certificates of appropriate government officials, and (ii) as to
matters of fact, upon certificates and written statements of officers
and employees of and accountants for the Company or its subsidiaries.
(d) At the date hereof and between pricing and each
settlement date:
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(i) there shall not have occurred any downgrading,
nor shall any notice have been given of any intended or
potential downgrading or of any review for a possible change
that does not indicate the direction of the possible change,
in the rating accorded any of the Company's securities by any
"nationally recognized statistical rating organization," as
such term is defined for purposes of Rule 436(g)(2) under the
Securities Act; and
(ii) there shall not have occurred any change, or
any development involving a prospective change, in the
condition, financial or otherwise, or in the earnings,
business or operations of the Company and its subsidiaries,
taken as a whole, from that set forth in the Prospectus
(exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement) that, in your
judgment, is material and adverse and that makes it, in your
judgment, impracticable to market the Notes on the terms and
in the manner contemplated in the Prospectus.
(e) At the date hereof, the Agents shall have received a
certificate of the Chief Executive Officer and the Chief Financial
Officer of the Company, dated as of the date hereof, to the effect
that (i) since the respective dates as of which information is given
in the Prospectus or since the date of the applicable agreement by one
or more Agents to purchase Notes as principal, there has not been 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, (ii) the representations
and warranties of the Company contained in Section 3 hereof are true
and correct with the same force and effect as though expressly made at
and as of the date of such certificate and (iii) the Company has
performed or complied with all agreements and satisfied all conditions
on its part to be performed or satisfied at or prior to the date of
such certificate. As used in this Section 9(e), the term "Prospectus"
means the Prospectus in the form first provided to the applicable
Agent or Agents for use in confirming sales of the Notes.
(f) On the date hereof and on each Settlement Date, counsel
to the Agents shall have been furnished with such documents and
opinions as such counsel may reasonably require for the purpose of
enabling such counsel to pass upon the issuance and sale of Notes as
herein contemplated and related proceedings, or in order to evidence
the accuracy and completeness of any of the representations and
warranties, or the fulfillment of any of the conditions, herein
contained; and all proceedings taken by the Company in connection with
the issuance and sale of Notes as herein contemplated shall be
satisfactory in form and substance to the Agents and to counsel to the
Agents.
If any condition specified in this Section 9 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the applicable Agent or Agents by notice to the Company at any time and any
such termination shall be without liability of any party to any other party,
except that the covenant regarding provision of an earnings statement set forth
in Section 5(h) hereof, the provision concerning payment of expenses under
Section 6 hereof, the indemnity and contribution agreement set forth in Section
7 hereof, the provisions concerning the survival of indemnities,
representations, warranties, etc. of Section 8 hereof, the
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provision relating to successors set forth in Section 14, and the provision
relating to applicable law set forth in Section 15 hereof shall remain in
effect.
10. DELIVERY OF AND PAYMENT FOR NOTES SOLD THROUGH AN AGENT. Delivery
of Notes sold through an Agent as agent shall be made by the Company to such
Agent for the account of any purchaser only against payment therefor in
immediately available funds. In the event that a purchaser shall fail either to
accept delivery of or to make payment for a Note on the date fixed for
settlement, such Agent shall promptly notify the Company and deliver such Note
to the Company and, if such Agent has theretofore paid the Company for such
Note, the Company will promptly return such funds to such Agent. If such
failure occurred for any reason other than default by such Agent in the
performance of its obligations hereunder, the Company will reimburse such Agent
on an equitable basis for its loss of the use of the funds for the period such
funds were credited to the Company's account.
11. ADDITIONAL COVENANTS OF THE COMPANY. The Company covenants and
agrees with the Agents that:
(a) Each acceptance by the Company of an offer for the purchase of
Notes (whether to one or more Agents as principal or through an Agent as
agent), and each delivery of Notes (whether to one or more Agents as principal
or through an Agent as agent), shall be deemed to be an affirmation that the
representations and warranties of the Company contained in this Agreement and
in any certificate theretofore delivered to the Agents in connection therewith
pursuant hereto are true and correct at the time of such acceptance or sale, as
the case may be, and an undertaking that such representations and warranties
will be true and correct at the time of delivery to such Agent or Agents or to
the purchaser or its agent, as the case may be, of the Note or Notes relating
to such acceptance or sale, as the case may be, as though made at and as of
each such time (and it is understood that such representations and warranties
shall relate to the Registration Statement and Prospectus as amended and
supplemented to each such time).
(b) Each time that (i) the Registration Statement or the Prospectus
shall be amended or supplemented (other than by an amendment or supplement
providing solely for a change in the interest rate or formula applicable to the
Notes or similar changes, and other than by an amendment or supplement which
relates exclusively to the issuance of securities other than the Notes), (ii)
there is filed with the Commission any document incorporated by reference into
the Prospectus (other than any Current Report on Form 8-K relating exclusively
to the issuance of securities other than the Notes), (iii) (if required in
connection with the purchase of Notes by one or more Agents as principal) the
Company sells Notes to such Agent or Agents as principal or (iv) if the Company
issues and sells Notes in a form not previously certified to the Agents by the
Company, the Company shall furnish or cause to be furnished to the Agent(s)
forthwith a certificate dated the date of filing with the Commission of such
supplement or document, the date of effectiveness of such amendment, or the
date of such sale, as the case may be, in form satisfactory to the Agent(s) to
the effect that the statements contained in the certificate referred to in
Section 9(d) hereof which were last furnished to the Agents are true and
correct at the time of such amendment, supplement, filing or sale, as the case
may be, as though made at and as of such time (except that such statements
shall be deemed to relate to the Registration Statement and the Prospectus as
amended and supplemented to such time) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in Section 9(d)
hereof, modified as
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necessary to relate to the Registration Statement and the Prospectus as amended
and supplemented to the time of delivery of such certificate.
(c) Each time that (i) the Registration Statement or the Prospectus
shall be amended or supplemented (other than by an amendment or supplement
providing solely for a change in the interest rate or formula applicable to the
Notes or similar changes or solely for the inclusion of additional financial
information, and other than by an amendment or supplement which relates
exclusively to the issuance of securities other than the Notes), (ii) there is
filed with the Commission any document incorporated by reference into the
Prospectus (other than any Current Report on Form 8-K, unless the Agents shall
otherwise specify), (iii) (if required in connection with the purchase of Notes
by one or more Agents as principal) the Company sells Notes to such Agent or
Agents as principal or (iv) if the Company issues and sells Notes in a form not
previously certified to the Agents by the Company, the Company shall furnish or
cause to be furnished forthwith to the Agent(s) and to counsel to the Agents
the written opinions of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP, counsel to the Company, dated
the date of filing with the Commission of such supplement or document, the date
of effectiveness of such amendment, or the date of such sale, as the case may
be, in form and substance satisfactory to the Agent(s), of the same tenor as
the opinion referred to in Section 9(b) hereof, but modified, as necessary, to
relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such opinion or, in lieu of such
opinion, counsel last furnishing such opinion to the Agents shall furnish the
Agent(s) with a letter substantially to the effect that the Agent(s) may rely
on such last opinion to the same extent as though it was dated the date of such
letter authorizing reliance (except that statements in such last opinion shall
be deemed to relate to the Registration Statement and the Prospectus as amended
and supplemented to the time of delivery of such letter authorizing reliance);
PROVIDED, HOWEVER, that counsel need not render the opinion required under
Section 9(b)(xviii) upon the filing of any Quarterly Report on Form 10-Q which
does not include information relating to such tax matters, unless the Agents
shall otherwise specify.
(d) Each time that (i) the Registration Statement or the Prospectus
shall be amended or supplemented to include additional financial information
(other than by an amendment or supplement which relates exclusively to the
issuance of securities other than the Notes), (ii) there is filed with the
Commission any document incorporated by reference into the Prospectus which
contains additional financial information, or (iii) (if required in connection
with the purchase of Notes by one or more Agents as principal) the Company
sells Notes to such Agent or Agents as principal, the Company shall cause
PricewaterhouseCoopers LLP to furnish to the Agent(s) a letter, dated the date
of effectiveness of such amendment, supplement or document with the Commission,
or the date of such sale, as the case may be, in form satisfactory to the
Agent(s), of the same tenor as the portions of the letter referred to in
clauses (i) and (ii) of Section 9(a) hereof but modified to relate to the
Registration Statement and Prospectus as amended and supplemented to the date
of such letter, and of the same general tenor as the portions of the letter
referred to in clauses (iv) and (v) of said Section 9(a) with such changes as
may be necessary to reflect changes in the financial statements and other
information derived from the accounting records of the Company.
12. TERMINATION. (a) This Agreement (excluding any agreement hereunder
by one or more Agents to purchase Notes as principal) may be terminated for any
reason, at any time by
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either the Company or an Agent, as to itself, upon the giving of 10 days'
written notice of such termination to the other party hereto.
(b) The applicable Agent or Agents may terminate any agreement
hereunder by such Agent or Agents to purchase Notes as principal, immediately
upon notice to the Company, at any time prior to the Settlement Date relating
thereto (i) if there has been, since the date of such agreement or since the
respective dates as of which information is given in the Prospectus, 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 shall have occurred any material
adverse change in the financial markets in the United States or any outbreak or
escalation of hostilities or other national or international calamity or crisis
the effect of which is such as to make it, in the judgment of such Agent or
Agents, impracticable to market the Notes or enforce contracts for the sale of
the Notes, or (iii) if trading in any securities of the Company has been
suspended by the Commission or a national securities exchange, or if trading
generally on either the American Stock Exchange or the New York Stock Exchange
shall have been suspended, or minimum or maximum prices for trading have been
fixed, or maximum ranges for prices for securities have been required, by
either of said exchanges or by order of the Commission or any other
governmental authority, or if a banking moratorium shall have been declared by
either Federal or New York authorities or if a banking moratorium shall have
been declared by the relevant authorities in the country or countries of origin
of any foreign currency or currencies in which the Notes are denominated or
payable, or (iv) if the rating assigned by any nationally recognized
statistical rating organization to any debt securities of the Company as of the
date of such agreement shall have been lowered since that date or if any such
rating organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of any
debt securities of the Company, or (v) if there shall have come to the
attention of such Agent or Agents any facts that would cause them to believe
that the Prospectus, at the time it was required to be delivered to a purchaser
of Notes, 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 the time of such delivery, not misleading. As
used in this Section 12(b), the term "Prospectus" means the Prospectus in the
form first provided to the applicable Agent or Agents for use in confirming
sales of the related Notes.
(c) In the event of any such termination, neither party will have any
liability to the other party hereto, except that (i) the Agents shall be
entitled to any commission earned in accordance with the third paragraph of
Section 4(b) hereof, (ii) if at the time of termination (a) any Agent shall own
any Notes purchased by it as principal with the intention of reselling them or
(b) an offer to purchase any of the Notes has been accepted by the Company but
the time of delivery to the purchaser or his agent of the Note or Notes
relating thereto has not occurred, the covenants set forth in Sections 5 and 11
hereof shall remain in effect until such Notes are so resold or delivered, as
the case may be, and (iii) the covenant set forth in Section 5(h) hereof, the
provisions of Section 6 hereof, the indemnity and contribution agreements set
forth in Section 7 hereof, and the provisions of Sections 8, 14 and 15 hereof
shall remain in effect.
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13. NOTICES. All communications hereunder shall be in writing and
shall be mailed, delivered or telecopied and confirmed, and any such notice
shall be effective when received at the address or telecopy number specified
below:
If to the Company:
Developers Diversified Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Chief Executive Officer
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-3485
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
If to the Agents:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, New York 10036
Attention: Manager - Continuously Offered Products
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, New York 10036
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Investment Banking Information Center
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
Banc of America Securities LLC
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: MTN Product Management
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
Banc One Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, Illinois 60670
Attention: Corporate Securities Structuring
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
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▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ Brothers Inc.
3 World Financial Center
12th Floor
New York, New York 10285-1200
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Medium-Term Note Department
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
Warburg Dillon Read LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
14. SUCCESSORS. This Agreement shall inure to the benefit of and be
binding upon you and the Company and their respective successors and legal
representatives. Nothing expressed or mentioned in this Agreement is intended
or shall be construed to give any person other than the persons mentioned in
the preceding sentence any legal or equitable right, remedy or claim under or
in respect of this Agreement, or any provisions herein contained, this
Agreement and all conditions and provisions hereof being intended to be and
being for the sole and exclusive benefit of such persons and for the benefit of
no other person; except that the representations, warranties, covenants,
agreements and indemnities of the Company, contained in this Agreement shall
also be for the benefit of the person or persons, if any, who control any Agent
within the meaning of Section 15 of the 1933 Act, and the indemnities given by
the several Agents shall also be for the benefit of each director of the
Company, each of the Company's officers who has signed the Registration
Statement and the person or persons, if any, who control the Company within the
meaning of Section 15 of the 1933 Act.
15. APPLICABLE LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York applicable to agreements
made and to be performed in said state. Specified times of day refer to New
York City time.
16. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, and if executed in more than one counterpart the executed
counterparts shall constitute a single instrument.
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If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter and your acceptance shall constitute a binding agreement
between us.
Very truly yours,
DEVELOPERS DIVERSIFIED REALTY CORPORATION
By: ___________________________________
Name:
Title:
Accepted and delivered,
as of the date first above written:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
By: _____________________________________
Name:
Title:
BANC OF AMERICA SECURITIES LLC
By: _____________________________________
Name:
Title:
BANC ONE CAPITAL MARKETS, INC.
By: _____________________________________
Name:
Title:
▇▇▇▇▇▇▇, ▇▇▇▇▇ & CO.
By: _____________________________________
Name:
Title:
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▇▇▇▇▇▇ BROTHERS INC.
By: _____________________________
Name:
Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
By: _____________________________
Name:
Title:
WARBURG DILLON READ LLC
By: _____________________________
Name:
Title:
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EXHIBIT A
The following terms, if applicable, shall be agreed to by one or more
Agents and the Company in connection with each sale of Notes:
Principal Amount: $__________
(or principal amount of foreign currency or composite currency)
Senior or Subordinated Rank:
Interest Rate:
If Fixed Rate Note, Interest Rate:
If Floating Rate Note:
Interest Rate Basis:
Initial Interest Rate, if any:
Spread and/or Spread Multiplier, if any:
Interest Reset Date(s):
Interest Payment Date(s):
Index Maturity:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date:
Fixed Interest Rate:
Calculation Agent:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
If Repayable:
Optional Repayment Date(s):
Stated Maturity Date:
Purchase Price: ____%, plus accrued interest, if any, from ___________
Settlement Date and Time:
Specified Currency:
Authorized Denominations:
Additional/Other Terms:
Also, in connection with the purchase of Notes by one or more Agents as
principal, agreement as to whether the following will be required:
Officers' Certificate pursuant to Section 11(b) of the Distribution
Agreement.
Legal Opinions pursuant to Section 11(c) of the Distribution Agreement.
Comfort Letter pursuant to Section 11(d) of the Distribution Agreement.
Stand-off Agreement pursuant to Section 5(k) of the Distribution
Agreement.
A-1
32
SCHEDULE A
As compensation for the services of the Agents hereunder, the Company
shall pay the applicable Agent, on a discount basis, a commission for the sale
of each Senior Note equal to the principal amount of such Senior Note multiplied
by the appropriate percentage set forth below (the commission payable with
respect to sales of Senior Notes will also apply to sales of Subordinated Notes
unless otherwise agreed by the Company and the applicable Agent):
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
--------------- ----------------
From 9 months to less than 1 year............................... .125%
From 1 year to less than 18 months.............................. .150
From 18 months to less than 2 years............................. .200
From 2 years to less than 3 years............................... .250
From 3 years to less than 4 years............................... .350
From 4 years to less than 5 years............................... .450
From 5 years to less than 6 years............................... .500
From 6 years to less than 7 years............................... .550
From 7 years to less than 10 years.............................. .600
From 10 years to less than 15 years............................. .625
From 15 years to less than 20 years............................. .700
From 20 years to 30 years....................................... .750
Greater than 30 years........................................... *
________________
*As agreed to by the Company and the applicable Agent at the time of sale.
