Exhibit 1.1
EXECUTION COPY
13,250,000 Shares
HRPT PROPERTIES TRUST
(a Maryland real estate investment trust)
Common Shares of Beneficial Interest
par value $.01 per share
PURCHASE AGREEMENT
June 17, 2003
XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
X.X. XXXXXXX & SONS, INC.
XXXX XXXXX XXXX XXXXXX INCORPORATED
UBS SECURITIES LLC
WACHOVIA SECURITIES, LLC
c/x Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
4 World Financial Center
New York, NY 10080
Ladies and Gentlemen:
HRPT Properties Trust, a Maryland real estate investment trust (the
"Company"), confirms its agreement with Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx
Incorporated ("Xxxxxxx Xxxxx"), X.X. Xxxxxxx & Sons, Inc. ("X.X. Xxxxxxx"), Xxxx
Xxxxx Xxxx Xxxxxx Incorporated ("Xxxx Xxxxx"), UBS Securities LLC ("UBS") and
Wachovia Securities, LLC ("Wachovia"), together with each of the other
Underwriters named in Schedule A hereto (collectively, the "Underwriters" which
term shall also include any underwriter substituted as hereinafter provided in
Section 10), for whom Xxxxxxx Xxxxx is acting as representative (in such
capacity, hereinafter referred to as the "Representative"), with respect to the
sale by the Company and the purchase by the Underwriters, acting severally and
not jointly, of the number of common shares of beneficial interest, par value
$.01 per share, of the Company (the "Common Shares") set forth in said Schedule
A and with respect to the grant by the Company to the Underwriters of the option
described in Section 2 hereof to purchase all or any part of an additional
1,987,500 Common Shares to cover overallotments, if any. The aforesaid
13,250,000 Common Shares (the "Initial Shares"), together with all or any part
of the 1,987,500 Common Shares subject to the option described in Section 2
hereof (the "Option Shares"), are collectively hereinafter called the "Shares."
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-56051) for the
registration of debt securities, preferred shares of beneficial interest,
depositary shares representing preferred shares, Common Shares and warrants
under the Securities Act of 1933, as amended (the "1933 Act"), and has filed
such amendments thereto, if any, as may have been required to the date hereof.
Such registration statement has been declared effective under the 1933 Act. Such
registration statement (as amended, if applicable) and the prospectus
constituting a part thereof, as supplemented by the prospectus supplement
relating to the Shares (including, in each case, all documents incorporated or
deemed to be incorporated by reference therein), 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 hereinafter referred to as the
"Registration Statement" and the "Prospectus", respectively. 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
in the Prospectus, as the case may be.
Section 1. REPRESENTATIONS AND WARRANTIES.
(a) The Company represents and warrants to each Underwriter as of the
date hereof as follows:
(i) At the respective times the Registration Statement and any
post-effective amendment thereto (including the filing of the Company's
most recent Annual Report on Form 10-K with the Commission) became
effective, the Registration Statement complied in all material respects
with the requirements of the 1933 Act and the rules and regulations under
the 1933 Act (the "1933 Act Regulations") and did 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, at the date hereof (unless the term
"Prospectus" refers to a prospectus which has been provided to the
Underwriters by the Company for use in connection with the offering of
the Shares which differs from the Prospectus on file at the Commission at
the date of effectiveness of the Registration Statement, in which case at
the time it is first provided to the Underwriters for such use) and at
the Closing Time referred to in Section 2 hereof, does not and 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 representations and warranties in this
subsection (i) shall not apply to statements or omissions in the
Registration Statement or the Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by any
Underwriter through Xxxxxxx Xxxxx expressly for use in the Registration
Statement or the Prospectus.
(ii) The documents incorporated or deemed to be incorporated by
reference in the Prospectus, at the time they were or hereafter are filed
with the Commission, complied and will comply in all material respects
with the requirements of the 1934 Act and the rules and regulations of
the Commission under the 1934 Act (the "1934 Act
2
Regulations"), and, when read together with the other information in the
Prospectus, at the time the Registration Statement became effective and
at Closing Time, 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.
(iii) The Company is a Maryland real estate investment trust duly
organized, validly existing and in good standing under the laws of the
State of Maryland. Each of its subsidiaries has been duly organized and
is validly existing as a corporation, partnership, limited liability
company or trust in good standing under the laws of its jurisdiction of
incorporation or organization, except where the failure to be in good
standing would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole. Each of the Company and its subsidiaries
has full power and authority (corporate and other) to carry on its
business as described in the Registration Statement and in the Prospectus
and to own, lease and operate its properties. Each of the Company and its
subsidiaries is duly qualified and is in good standing as a foreign
corporation, partnership, limited liability company, or trust, as the
case may be, and is authorized to do business in each jurisdiction in
which the nature of its business or its ownership or leasing of property
requires such qualification, except where the failure to be so qualified
would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(iv) The financial statements of the Company and its subsidiaries,
together with the related schedules and notes thereto, included or
incorporated by reference in the Registration Statement and in the
Prospectus, comply as to form in all material respects with the
requirements of the 1933 Act, the 1933 Act Regulations, the 1934 Act and
the 1934 Act Regulations. Such financial statements of the Company,
together with the related schedules and notes thereto, present fairly the
consolidated financial position, results of operations, shareholders'
equity and changes in financial position of the Company and its
subsidiaries, at the dates or for the respective periods therein
specified and have been prepared in accordance with generally accepted
accounting principles ("GAAP") consistently applied throughout the
periods involved. The pro forma financial statements and other pro forma
financial information (including the notes thereto) included or
incorporated by reference in the Registration Statement and in the
Prospectus (i) present fairly the information shown therein, (ii) have
been prepared in accordance with the Commission's rules and guidelines
with respect to pro forma financial statements and (iii) have been
properly compiled on the basis described therein and the assumptions used
in the preparation of such pro forma financial statements and other pro
forma financial information (including the notes thereto) are reasonable
and the adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein. The adjusted pro forma
financial statements and other adjusted pro forma financial information
(including the notes thereto) included or incorporated by reference in
the Registration Statement and in the Prospectus (i) present fairly the
information shown therein and (ii) have been properly compiled on the
basis described therein and the assumptions used in the preparation of
such adjusted pro forma financial statements and other adjusted pro forma
financial information (including the
3
notes thereto) are reasonable and the adjustments used therein are
appropriate to give effect to the transactions or circumstances referred
to therein.
(v) The accountants who have certified the financial statements of
the Company and its subsidiaries included or incorporated by reference in
the Registration Statement and in the Prospectus are independent
certified public accountants as required by the 1933 Act; provided ,
however, the Company makes no representation or warranty with respect to
Xxxxxx Xxxxxxxx LLP, who audited the financial statements of Hospitality
Properties Trust for the year ended December 31, 2001 and was convicted
of obstruction of justice in June 2002 and ceased to practice before the
Commission on August 31, 2002.
(vi) All of the outstanding shares of beneficial interest of the
Company have been duly authorized and are validly issued, fully paid,
non-assessable (except as otherwise described in the Registration
Statement) and free of preemptive or similar rights or other rights to
subscribe for or to purchase securities provided for by law or by its
Declaration of Trust or bylaws; the Shares to be issued and sold pursuant
to this Agreement have been duly authorized and, when issued and
delivered to the Underwriters against payment therefor as provided
hereunder, will have been validly issued and will be fully paid,
non-assessable (except as otherwise described in the Registration
Statement) and free of preemptive or similar rights; there are no
outstanding subscriptions, rights, warrants, options, calls, convertible
securities, commitments of sale or liens related to or entitling any
person to purchase or otherwise to acquire any Common Shares of, or other
ownership interest in, the Company, except as otherwise disclosed in the
Registration Statement or the Prospectus and except for awards under the
Company's incentive share award plans made in the ordinary course of
business; all outstanding Common Shares are listed on the New York Stock
Exchange (the "NYSE") and the Company knows of no reason or set of facts
which is likely to result in the delisting of such Common Shares or the
inability to list the Shares; and there are no rights of holders of
securities of the Company to the registration of Common Shares or other
securities that would require inclusion of such Common Shares or other
securities in the offering of the Shares.
(vii) All of the outstanding shares of beneficial interest of, or
other ownership interests in, each of the Company's subsidiaries have
been duly authorized and validly issued and are fully paid and, except as
to subsidiaries that are partnerships or limited liability companies,
nonassessable, and, except as disclosed in the Registration Statement or
in the Prospectus, are owned by the Company free and clear of any
security interest, claim, lien, encumbrance or adverse interest of any
nature.
(viii) The authorized capital of the Company, including the Common
Shares, conforms as to legal matters to the description thereof contained
in the Prospectus (or the documents incorporated therein by reference).
(ix) Since the respective dates as of which information is given in
the Prospectus, and except as otherwise disclosed therein, (i) there has
been no material adverse change in the business, operations, earnings,
prospects, properties or condition
4
(financial or otherwise) of the Company and its subsidiaries, taken as a
whole, whether or not arising in the ordinary course of business, (ii)
there have been no material transactions entered into by the Company and
its subsidiaries, on a consolidated basis, other than transactions in the
ordinary course of business, (iii) neither the Company nor its
subsidiaries has incurred any material liabilities or obligations, direct
or contingent, (iv) the Company and its subsidiaries, on a consolidated
basis, have not, (A) other than regular quarterly dividends, declared,
paid or made a dividend or distribution of any kind on any class of its
shares of beneficial interest (other than dividends or distributions from
wholly owned subsidiaries to the Company), (B) issued any shares of
beneficial interest of the Company or any of its subsidiaries or any
options, warrants, convertible securities or other rights to purchase
shares of beneficial interest of the Company or any of its subsidiaries
(other than the issuance of Common Shares to the trustees and officers of
the Company pursuant to the Company's incentive share award plans) or (C)
repurchased or redeemed shares of beneficial interest, and (v) there has
not been (A) any material decrease in the Company's net worth or (B) any
material increase in the short-term or long-term debt (including
capitalized lease obligations but excluding borrowings under existing
bank lines of credit) of the Company and its subsidiaries, on a
consolidated basis.
(x) The Company and each of its subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's
general or specific authorizations; (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity
with GAAP and to maintain asset accountability; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(xi) Neither the Company nor any of its subsidiaries is in violation
of its respective charter or by-laws or other organizational documents or
in default in the performance of any obligation, agreement or condition
contained in any bond, debenture, note or any other evidence of
indebtedness or in any other agreement, indenture or instrument to which
the Company or any of its subsidiaries is a party or by which any of
their respective properties or assets may be bound or affected, except
for any such violation that would not have a material adverse effect on
the condition, financial or otherwise or in the earnings, business
affairs or business prospects of the Company and its subsidiaries, taken
as a whole. The Company is not in violation of any law, ordinance,
governmental rule or regulation or court decree to which it is subject,
except for any such violation that would not, individually or in the
aggregate, have a material adverse effect on the business, operations,
earnings, prospects, properties or condition (financial or otherwise) of
the Company and its subsidiaries, taken as a whole.
(xii) Except as disclosed in the Registration Statement or in the
Prospectus, there is not now pending or, to the knowledge of the Company,
threatened, any litigation, action, suit or proceeding to which the
Company is or will be a party before or by any court or governmental
agency or body, which (A) might result in 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, taken
as a whole, or (B) might
5
materially and adversely affect the property or assets of the Company and
its subsidiaries, taken as a whole, or (C) concerns the Company and is
required to be disclosed in the Registration Statement or the Prospectus,
or (D) could adversely affect the consummation of this Agreement and the
issuance, purchase and sale of the Shares. No contract or other document
is required to be described in the Registration Statement or in the
Prospectus or to be filed as an exhibit to the Registration Statement
that is not described therein or filed as required.
(xiii) The execution, delivery and performance by the Company of
this Agreement, the issuance, offering and sale by the Company of the
Shares as contemplated by the Registration Statement and by the
Prospectus and the consummation of the transactions contemplated hereby
and compliance with the terms and provisions hereof, will not violate or
conflict with or constitute a breach of any of the terms or provisions
of, or a default under, (i) the Amended and Restated Declaration of Trust
(the "Declaration of Trust") or the Amended and Restated By-laws of the
Company or the charter or by-laws or other organizational documents of
any subsidiaries of the Company, (ii) any agreement, indenture or other
instrument to which the Company or any of its subsidiaries is a party or
by which the Company or any of its subsidiaries or their respective
properties or assets is bound, or (iii) any laws, administrative
regulations or rulings or decrees to which the Company or any of its
subsidiaries or their respective properties or assets may be subject.
(xiv) No consent, approval, authorization or order of, or
registration, filing or qualification with, any governmental body or
regulatory agency having jurisdiction over the Company or any of its
subsidiaries or any of their respective properties or assets is required
for the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby, including, without
limitation, the issuance, sale and delivery of the Shares pursuant to
this Agreement, except such as have been obtained or made and such as may
be required under foreign and state securities or "Blue Sky" or real
estate syndication laws.
(xv) Except as otherwise disclosed in the Registration Statement or
in the Prospectus, the Company and each of its subsidiaries has good and
marketable title or ground leases, free and clear of all liens, claims,
encumbrances and restrictions, except liens for taxes not yet due and
payable and other liens and encumbrances which do not, either
individually or in the aggregate, materially and adversely affect the
current use or value thereof, to all property and assets described in the
Registration Statement or in the Prospectus as being owned or leased by
them. Except as otherwise set forth in the Registration Statement or in
the Prospectus, all leases to which the Company and each of its
subsidiaries is a party relating to real property, and all other leases
which are material to the business of the Company and its subsidiaries,
taken as a whole, are valid and binding, and no default (to the Company's
knowledge, in the case of leases to which the Company is a party as
lessor, that would, individually or in the aggregate, have a material
adverse effect on the business, operations, earnings, prospects,
properties or condition (financial or otherwise) of the Company and its
subsidiaries, taken as a whole) has occurred and is continuing
thereunder, and the Company and each of its subsidiaries enjoys peaceful
and undisturbed possession under all such leases to which it is a party
as
6
lessee. With respect to all properties owned or leased by the Company and
each of its subsidiaries, the Company or such subsidiary has such
documents, instruments, certificates, opinions and assurances, including
without limitation, fee, leasehold owners or mortgage title insurance
policies (disclosing no encumbrances or title exceptions which are
material to the Company and its subsidiaries considered as a whole,
except as otherwise set forth in the Registration Statement and in the
Prospectus), legal opinions and property insurance policies in each case
in form and substance as are usual and customary in transactions
involving the purchase of similar real estate and are appropriate for the
Company or such subsidiary to have obtained.
(xvi) The Company and each of its subsidiaries owns, or possesses
adequate rights to use, all patents, trademarks, trade names, service
marks, copyrights, licenses and other rights necessary for the conduct of
their respective businesses as described in the Registration Statement
and the Prospectus, and neither the Company nor any of its subsidiaries
has received any notice of conflict with, or infringement of, the
asserted rights of others with respect to any such patents, trademarks,
trade names, service marks, copyrights, licenses and other such rights
(other than conflicts or infringements that, if proven, would not have a
material adverse effect on the business, operations, earnings, prospects,
properties or condition (financial or otherwise) of the Company and its
subsidiaries, taken as a whole), and neither the Company nor any of its
subsidiaries knows of any basis therefor.
(xvii) All material tax returns required to be filed by the Company
and each of its subsidiaries in any jurisdiction have been timely filed,
other than those filings being contested in good faith, and all material
taxes, including withholding taxes, penalties and interest, assessments,
fees and other charges due pursuant to such returns or pursuant to any
assessment received by the Company or any of its subsidiaries have been
paid, other than those being contested in good faith and for which
adequate reserves have been provided.
(xviii) Except for those matters which in the aggregate do not have
a material adverse effect on the business, operations, earnings,
prospects, properties or condition (financial or otherwise) of the
Company and its subsidiaries taken as a whole, and except for Hazardous
Materials (as defined below) or substances which are handled, used and/or
disposed of in compliance with all applicable federal, state and local
requirements, to the Company's knowledge, after due investigation, the
real property owned, leased or otherwise operated by the Company and each
of its subsidiaries in connection with the operation of their respective
businesses, including, without limitation, any subsurface soils and
ground water (the "Realty"), is free of contamination from any Hazardous
Materials. To the Company's knowledge, after due investigation, the
Realty does not contain any underground storage or treatment tanks,
active or abandoned water, gas or oil xxxxx, or any other underground
improvements or structures, other than the foundations, footings, or
other supports for the improvements located thereon which, based on
present knowledge, could, in their present condition, reasonably be
expected to presently cause a material detriment to or materially impair
the beneficial use thereof by the Company or constitute or cause a
significant health, safety or other environmental hazard to occupants or
users thereof without regard to any special conditions of such occupants
or users. The
7
Company represents that, after due investigation, it has no knowledge of
any material violation, with respect to the Realty, of any Environmental
Law, or of any material liability on the part of the Company with respect
to the Realty, resulting from the presence, use, release, threatened
release, emission, disposal, pumping, discharge, generation or processing
of any Hazardous Materials. As used herein, "Environmental Law" means any
federal, state or local statute, regulation, judgment, order or
authorization relating to emissions, discharges, releases or threatened
releases of Hazardous Materials into ambient air, surface water, ground
water, publicly-owned treatment works, septic systems or land, or
otherwise relating to the pollution or protection of public health or the
environment, and "Hazardous Materials" means any substance, material or
waste which is regulated, defined, or listed as a "hazardous waste",
"hazardous substance", "toxic substance", "medical waste", "infectious
waste" or other similar terms in any federal, state or local statute,
ordinance or regulation or by any federal, state or local government or
quasi-government authority, or any petroleum products, asbestos,
lead-based paint, polychlorinated biphenyls, flammable explosives or
radioactive materials.
(xix) Each of the Company and its subsidiaries has such permits,
licenses, franchises and authorizations of governmental or regulatory
authorities (together, "permits"), including, without limitation, under
any applicable Environmental Law, as are necessary to own, lease and
operate its properties and to engage in the business currently conducted
by it, except such permits as to which the failure to own or possess will
not in the aggregate have a material adverse effect on the business,
operations, earnings, prospects, properties or condition (financial or
otherwise) of the Company and its subsidiaries, taken as a whole, and the
Company does not have any reason to believe that any governmental body or
agency is considering limiting, suspending or revoking any such license,
certificate, permit, authorization, approval, franchise or right; each of
the Company and its subsidiaries has fulfilled and performed all of its
material obligations with respect to such permits and no event has
occurred which allows, or after notice or lapse of time would allow,
revocation or termination thereof or results in any other material
impairment of the rights of the holder of any such permit; and, except as
described in the Registration Statement and in the Prospectus, such
permits contain no restrictions that are materially burdensome to the
Company or any of its subsidiaries.
(xx) To the knowledge of the Company, no labor problem exists or is
imminent with employees of the Company or any of its subsidiaries that
could have a material adverse effect on the business, operations,
earnings, prospects, properties or condition (financial or otherwise) of
the Company and its subsidiaries, taken as a whole.
(xxi) Neither the Company nor any of its subsidiaries nor, to the
knowledge of the Company, any officer, trustee or director purporting to
act on behalf of the Company or any of its subsidiaries, has at any time:
(i) made any contributions to any candidate for political office, or
failed to disclose fully any such contributions, in violation of law;
(ii) made any payment of funds to, or received or retained any funds
from, any state, federal or foreign governmental officer or official, or
other person charged with similar public or quasi-public duties, other
than payments required or allowed by applicable law; or (iii) engaged in
any transactions, maintained any bank accounts or used any corporate
funds
8
except for transactions, bank accounts and funds, which have been and are
reflected in the normally maintained books and records of the Company and
its subsidiaries.
(xxii) Except as referred to or described in the Registration
Statement and in the Prospectus, none of the subsidiaries of the Company
owns any shares of stock or any other securities of any corporation or
has any equity interest in any firm, partnership, association or other
entity other than the issued capital shares of its subsidiaries, and the
Company does not own, directly or indirectly, any shares of stock or any
other securities of any corporation or have any equity interest in any
firm, partnership, association or other entity other than the issued
capital shares of its subsidiaries, except in each case for
non-controlling positions acquired in the ordinary course of business.
(xxiii) Except as disclosed in the Registration Statement and in the
Prospectus, there are no material outstanding loans or advances or
material guarantees of indebtedness by the Company or any of its
subsidiaries to or for the benefit of any of the officers, trustees or
directors of the Company or any of its subsidiaries or any of the members
of the families of any of them.
(xxiv) The Company and each of its subsidiaries maintains insurance,
duly in force, with insurers of recognized financial responsibility; such
insurance insures against such losses and risks as are adequate in
accordance with customary industry practice to protect the Company and
its subsidiaries and their respective businesses; and neither the Company
nor any such subsidiary has any reason to believe that it will not be
able to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may be
necessary to continue its business at a cost that would not materially
and adversely affect the business, operations, earnings, prospects,
properties or condition (financial or otherwise) of the Company and its
subsidiaries, taken as a whole, except as disclosed in or contemplated by
the Registration Statement and by the Prospectus.
(xxv) Neither the Company nor any of its officers and directors (as
defined in the 1933 Act Regulations) has taken or will take, directly or
indirectly, prior to the termination of the offering contemplated by this
Agreement, any action designed to stabilize or manipulate the price of
any security of the Company, or which has caused or resulted in, or which
might in the future reasonably be expected to cause or result in,
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares.
(xxvi) Neither the Company nor any of its subsidiaries is an
"investment company" or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company" as such terms are
defined in the Investment Company Act of 1940, as amended (the "1940
Act"), or an "investment adviser" as such term is defined in the
Investment Advisers Act of 1940, as amended.
(xxvii) The Company is organized in conformity with the requirements
for qualification, and, as of the date hereof the Company operates, and
as of Closing Time the Company will operate, in a manner that qualifies
the Company as a "real estate
9
investment trust" under the Internal Revenue Code of 1986, as amended
(the "Code"), and the rules and regulations thereunder, for 2003 and
subsequent years. The Company qualified as a real estate investment trust
under the Code for each of its taxable years from 1987 through 2002.
(xxviii) No default exists, and no event has occurred which, with
notice or lapse of time or both, would constitute a default in the due
performance and observance of any term, covenant or condition of any
indenture, mortgage, deed of trust, lease or other agreement or
instrument to which the Company or any of its subsidiaries is a party or
by which the Company or any of its subsidiaries or any of their
respective properties is bound or may be affected, except such defaults
which, singly or in the aggregate, would not have a material adverse
effect on the business, operations, earnings, prospects, properties or
condition (financial or otherwise) of the Company and its subsidiaries,
considered as a whole, except as disclosed in the Registration Statement
and in the Prospectus.
(xxix) The Company has established and maintains disclosure controls
and procedures (as such term is defined in Rule 13a-14 and 15d-14 under
the 1934 Act) that (a) are designed to ensure that material information
relating to the Company, including its consolidated subsidiaries, is made
known to the Company's Chief Executive Officer and its Chief Financial
Officer (or persons performing similar functions) by others within those
entities, particularly during the periods in which the filings made by
the Company with the Commission which it may make under Sections 13(a),
13(c), 14 or 15(d) of the 1934 Act are being prepared, (b) have been
evaluated for effectiveness as of a date within 90 days prior to the
filing of the Company's most recent Annual Report on Form 10-K filed with
the Commission and (c) are effective to perform the functions for which
they were established.
(xxx) Except as otherwise disclosed in the Prospectus, since the
respective dates as of which information is given in the Prospectus,
there has been no material adverse change in the business, operations,
earnings, prospects, properties or condition (financial or otherwise) of
Reit Management & Research LLC (the "Advisor"), whether or not arising in
the ordinary course of business, that would have a material adverse
effect on the Company and its subsidiaries, taken as a whole. The
Advisory Agreement, dated as of January 1, 1998, as amended by Amendment
No. 1 thereto, dated as of October 12, 1999 (the "Advisory Agreement"),
between the Company and the Advisor, has been duly authorized, executed
and delivered by the parties thereto and constitutes the valid agreement
of the parties thereto, enforceable in accordance with its terms, except
as limited by (a) the effect of bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other similar laws relating to or
affecting the rights or remedies of creditors or (b) the effect of
general principles of equity (regardless of whether enforcement is sought
in a proceeding in equity or at law).
(b) Any certificate signed by any officer of the Company or any of its
subsidiaries and delivered to the Representative or to counsel for the
Underwriters shall be deemed a representation and warranty by the Company to
each Underwriter as to the matters covered thereby.
10
Section 2. SALE AND DELIVERY TO THE UNDERWRITERS; CLOSING.
(a) On the basis of the representations and warranties herein contained
and subject to the terms and conditions herein set forth, the Company agrees to
sell to each Underwriter, severally and not jointly, and each Underwriter,
severally and not jointly, agrees to purchase from the Company, at a price per
share of $9.0345, the number of Initial Shares set forth in Schedule A opposite
the name of such Underwriter, plus any additional number of Initial Shares which
such Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof.
(b) In addition, on the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company hereby grants an option to the Underwriters, severally and not jointly,
to purchase up to an additional 1,987,500 Shares at the price per share set
forth in (a) above. The option hereby granted will expire 30 days after the date
of this Agreement and may be exercised in whole or in part from time to time
only for the purpose of covering overallotments which may be made in connection
with the offering and distribution of the Initial Shares upon notice by the
Representative to the Company setting forth the number of Option Shares as to
which the several Underwriters are then exercising the option and the time, date
and place of payment and delivery for such Option Shares. Any such time and date
of delivery (a "Date of Delivery") shall be determined by the Representative but
shall not be later than seven full business days, nor earlier than two full
business days, after the exercise of said option, nor in any event prior to
Closing Time, unless otherwise agreed upon by the Representative and the
Company. If the option is exercised as to all or any portion of the Option
Shares, such Option Shares shall be purchased by the Underwriters, severally and
not jointly, in proportion to their respective Initial Share underwriting
obligations as set forth in Schedule A.
(c) Payment of the purchase price for and delivery of certificates for
the Initial Shares shall be made at the offices of Xxxxxxxx & Worcester LLP, Xxx
Xxxx Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other place as shall
be agreed upon by the Representative and the Company, at 9:00 A.M. on the third
(fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any given day)
business day (unless postponed in accordance with the provisions of Section 10
hereof) following the date of this Agreement, or such other time not later than
ten business days after such date as shall be agreed upon by the Representative
and the Company (such time and date of payment and delivery being herein called
"Closing Time"). In addition, in the event that the overallotment option
described in (b) above is exercised by the Underwriters, payment of the purchase
price for and delivery of certificates for the related Option Shares shall be
made at the above-mentioned office of Xxxxxxxx & Worcester LLP, or at such other
place as shall be mutually agreed upon by the Representative and the Company, on
each Date of Delivery as specified in the notice from the Representative to the
Company. Payment shall be made by wire transfer of immediately available funds
payable to an account designated in writing by the Company against delivery to
the Representative for the respective accounts of the Underwriters of
certificates for the Shares to be purchased by them. The certificates for the
Initial Shares and the Option Shares shall be in such authorized denominations
and registered in such names as the Representative may request in writing at
least one full business day before Closing Time or the Date of Delivery, as the
case may be. It is understood that each Underwriter has authorized the
Representative, for its account, to accept delivery of and receipt for, and to
make payment of, the purchase price for, the Initial Shares and the Option
Shares which it has agreed to purchase. The
11
Representative, individually and not as representative of the several
Underwriters may (but shall not be obligated to) make payment of the purchase
price for the Initial Shares or the Option Shares to be purchased by any
Underwriter whose funds have not been received by Closing Time, but any such
payment shall not relieve such Underwriter from its obligations hereunder. The
certificates for the Initial Shares and the Option Shares will be made available
for examination and packaging by the Representative not later than 10:00 A.M.
(Eastern time) on the business day prior to Closing Time or the Date of
Delivery, as the case may be.
Section 3. COVENANTS OF THE COMPANY. The Company covenants with each
Underwriter as follows:
(a) Immediately following the execution of this Agreement, the Company
will prepare a prospectus supplement setting forth the number of Shares covered
thereby and their terms not otherwise specified in the Prospectus, the
Underwriters' names, the price at which the Shares are to be purchased by the
Underwriters from the Company, and such other information as the Representative
and the Company deem appropriate in connection with the offering of the Shares;
and the Company will promptly transmit copies of the Prospectus Supplement to
the Commission for filing pursuant to Rule 424(b) of the 1933 Act Regulations
and will furnish to the Underwriters as many copies of the Prospectus (including
such Prospectus Supplement) as they shall reasonably request including, if
requested by the Underwriters, in addition to or in lieu thereof, electronic
copies of the Prospectus.
(b) Until the termination of the initial offering of the Shares, the
Company will notify the Representative immediately, and confirm the notice in
writing, (i) of the effectiveness of any amendment to the Registration
Statement, (ii) of the transmittal to the Commission for filing of any
supplement or amendment to the Prospectus or any document to be filed pursuant
to the 1934 Act, (iii) of the receipt of any comments from the Commission with
respect to the Registration Statement or Prospectus or documents incorporated or
deemed to be incorporated by reference therein, (iv) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus with respect to the Shares or for additional
information relating thereto, and (v) of 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. The Company will make every
reasonable effort to prevent the issuance of any such stop order and, if any
stop order is issued, to obtain the lifting thereof at the earliest possible
moment.
(c) The Company will give the Representative notice of its intention to
file or prepare any post-effective amendment to the Registration Statement or
any amendment or supplement (including any document to be filed pursuant to the
1934 Act prior to the termination of the initial offering of the Shares) to the
Prospectus (including any revised prospectus which the Company proposes for use
by the Underwriters in connection with the offering of the Shares which differs
from the prospectus on file at the Commission at the time that the Registration
Statement becomes effective, whether or not such revised prospectus is required
to be filed pursuant to Rule 424(b) of the 1933 Act Regulations), will furnish
the Representative with copies of any such amendment or supplement a reasonable
amount of time prior to such proposed filing or use, as the case may be, and
will not file any such amendment or supplement or use any such prospectus to
which counsel for the Underwriters shall reasonably object.
12
(d) The Company will deliver to the Representative a conformed copy of
the Registration Statement as originally filed and of each amendment thereto
filed prior to the termination of the initial offering of the Shares (including
exhibits filed therewith or incorporated by reference therein and the documents
incorporated by reference into the Prospectus pursuant to Item 12 of Form S-3).
(e) The Company will furnish to the Underwriters, from time to time
during the period when the Prospectus is required to be delivered under the 1933
Act or the 1934 Act, such number of copies of the Prospectus (as amended or
supplemented) as the Underwriters may reasonably request for the purposes
contemplated by the 1933 Act, the 1933 Act Regulations, the 1934 Act or 1934 Act
Regulations including, if requested by the Underwriters, in addition to or in
lieu thereof, electronic copies of the Prospectus.
(f) If any event shall occur as a result of which it is necessary, in the
opinion of counsel for the Underwriters, to amend or supplement the Prospectus
in order to make the Prospectus not misleading in the light of the circumstances
existing at the time it is delivered, the Company will either (i) forthwith
prepare and furnish to the Underwriters an amendment of or supplement to the
Prospectus or (ii) make an appropriate filing pursuant to Section 13, 14 or 15
of the 1934 Act, in form and substance reasonably satisfactory to counsel for
the Underwriters, which will amend or supplement the Prospectus so that it 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 existing at the time it is delivered, not misleading.
(g) The Company will endeavor in good faith, in cooperation with the
Representative, to qualify the Shares for offering and sale under the applicable
securities laws and real estate syndication laws of such states and other
jurisdictions of the United States as the Representative may designate; provided
that, in connection therewith, the Company shall not be required to qualify as a
foreign corporation or trust or to file any general consent to service of
process. In each jurisdiction in which the Shares have been so qualified the
Company will file such statements and reports as may be required by the laws of
such jurisdiction to continue such qualification in effect for so long as
required for the distribution of the Shares.
(h) The Company will make generally available to its security holders as
soon as reasonably practicable, but not later than 90 days after the close of
the period covered thereby, an earnings statement of the Company (in form
complying with the provisions of Rule 158 of the 1933 Act Regulations) covering
a period of at least twelve months beginning not later than the first day of the
Company's fiscal quarter next following the effective date of the Registration
Statement. "Earning statements", "make generally available" and "effective date"
will have the meanings contained in Rule 158 of the 1933 Act Regulations.
(i) The Company will use the net proceeds received by it from the sale of
the Shares in the manner specified in the Prospectus under the caption "Use of
Proceeds" in all material respects.
(j) The Company will use its best efforts to effect the listing of the
Shares on the NYSE.
13
(k) The Company currently intends to continue to elect to qualify as a
"real estate investment trust" under the Code, and use its best efforts to
continue to meet the requirements to qualify as a "real estate investment trust"
under the Code.
(l) The Company will timely file any document which it is required to
file pursuant to the 1934 Act prior to the termination of the offering of the
Shares.
(m) The Company will not, during a period of 60 days from the date of
this Agreement, without the prior written consent of Xxxxxxx Xxxxx, register,
offer, sell, contract to sell, grant any option to purchase or otherwise dispose
of any Common Shares or any securities convertible into or exercisable or
exchangeable for Common Shares, or warrants to purchase Common Shares, other
than (i) the Shares which are to be sold pursuant to this Agreement, (ii) Common
Shares issued or to be issued pursuant to the Company's incentive share award
plans, (iii) Common Shares to be issued as partial or full payment for
properties directly or indirectly acquired or to be acquired by the Company or
its subsidiaries; provided that, the Company shall have conditioned the issuance
of such Common Shares upon the agreement of the recipients to the restrictions
of this paragraph (m); (iv) the issuance of Common Shares to any sponsor or
underwriter of a unit investment trust; provided that, the unit investment trust
shall have a limitation upon the sale of such Common Shares until the expiration
of the 60-day period in this paragraph (m), and (v) the registration of Common
Shares on an omnibus shelf registration statement.
Section 4. PAYMENT OF EXPENSES. The Company will pay all expenses
incident to the performance of its obligations under this Agreement, including
(i) the preparation and filing of the Registration Statement as originally filed
and of each amendment thereto, (ii) the preparation and filing of this
Agreement, (iii) the preparation, issuance and delivery of the Shares to the
Underwriters, (iv) the fees and disbursements of counsel for the Company,
referred to in Section 5(b) hereof, and the Company's accountants, (v) the
qualification of the Shares under securities laws and real estate syndication
laws in accordance with the provisions of Section 3(g) hereof, including filing
fees and the fee and disbursements of counsel for the Company in connection
therewith and in connection with the preparation of any Blue Sky Survey, (vi)
the printing and delivery to the Underwriters of copies of the Registration
Statement as originally filed and of each amendment thereto, and of the
Prospectus and any amendments or supplements thereto, (vii) the fees and
expenses incurred in connection with the listing of the Shares on the NYSE,
(viii) the cost of printing or reproducing and delivering to the Underwriters
copies of any Blue Sky Survey, (ix) the cost of providing any CUSIP or other
identification numbers for the Shares, and (x) any transfer taxes imposed on the
sale of the Shares to the Underwriters.
If this Agreement is terminated by the Representative in accordance with
the provisions of Section 5 or Section 9(a)(i), the Company shall reimburse the
Underwriters for all of their out-of-pocket expenses, including the reasonable
fees and disbursements of counsel for the Underwriters.
Section 5. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The obligations
of the Underwriters hereunder are subject to the accuracy of the representations
and warranties of the Company herein contained, to the performance by the
Company of its obligations hereunder, and to the following further conditions:
14
(a) At Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission. The price of the Shares and
any other information previously omitted from the effective Registration
Statement pursuant to Rule 415 of the 1933 Act Regulations shall have been
transmitted to the Commission for filing pursuant to Rule 424(b) of the 1933 Act
Regulations within the prescribed time period, and prior to Closing Time the
Company shall have provided evidence satisfactory to the Representative of such
timely filing, or a post-effective amendment providing such information shall
have been filed and declared effective in accordance with the requirements of
the 1933 Act Regulations.
(b) At Closing Time the Underwriters shall have received the favorable
opinion, dated as of Closing Time, of Xxxxxxxx & Worcester LLP, counsel for the
Company, in form and substance satisfactory to counsel for the Underwriters, to
the effect that:
(i) The Company is a Maryland real estate investment trust duly
organized, validly existing and in good standing under the laws of the
State of Maryland; each of its Significant Subsidiaries (as defined in
Rule 1-02 of Regulation S-X under the 1933 Act) has been duly organized,
is validly existing as a corporation, partnership, limited liability
company or trust, as the case may be, and in good standing under the laws
of its jurisdiction of incorporation or organization; each of the Company
and its Significant Subsidiaries has the corporate, partnership, limited
liability company or trust power and authority (as applicable) to carry
on its business as described in the Registration Statement and in the
Prospectus and to own, lease and operate its properties; each of the
Company and its Significant Subsidiaries is duly qualified and is in good
standing as a foreign corporation, partnership, limited liability company
or trust, as the case may be, authorized to do business in each
jurisdiction in which its ownership or leasing of property requires such
qualification, except where the failure to be so qualified would not have
a material adverse effect on the Company and its subsidiaries, taken as a
whole.
(ii) (A) All of the outstanding shares of beneficial interest of the
Company have been duly authorized by all necessary trust action and are
validly issued, fully paid and non-assessable (except as otherwise
described in the Registration Statement) and (B) the Shares have been
duly authorized by all necessary trust action and, when issued and
delivered to the Underwriters against payment therefor in accordance with
the terms of this Agreement, will be validly issued, fully paid and
non-assessable, and will be free of any preemptive or, to such counsel's
knowledge, similar rights that entitle any person (other than the
Underwriters, their successors and assigns) to acquire any Shares upon
the issuance thereof by the Company.
(iii) All of the issued and outstanding shares of beneficial
interest of, or other ownership interests in, each of the Company's
subsidiaries have been duly authorized and validly issued and are fully
paid and, except as to subsidiaries that are partnerships or limited
liability companies, non-assessable, and, to such counsel's knowledge,
are owned by the Company free and clear of any security interest or other
adverse claim (within the meaning of Article 8 of the Massachusetts
Uniform Commercial Code).
15
(iv) The Company has the requisite trust power and authority to
enter into and perform this Agreement and to issue and deliver the
Shares.
(v) This Agreement has been duly authorized, executed and delivered
by the Company.
(vi) The execution, delivery and performance of this Agreement, and
the consummation of the transactions herein contemplated will not
conflict with or constitute a breach or violation of any of the terms or
provisions of, or constitute a default under, (A) the Declaration of
Trust or the By-laws of the Company or the charter or by-laws or other
organizational documents of any Significant Subsidiary of the Company,
(B) except as disclosed in the Prospectus, any material agreement,
indenture or other instrument to which the Company, or any of its
Significant Subsidiaries or their respective material properties or
assets is bound, or (C) any laws, administrative regulations or rulings
or decrees known to such counsel to which the Company, any of its
Significant Subsidiaries or their respective material properties or
assets may be subject.
(vii) No consent, approval, authorization, order, registration,
filing, qualification, license or permit of or with any federal,
Massachusetts or Maryland court or public, governmental or regulatory
agency or body having jurisdiction over the Company or any of its
Significant Subsidiaries or any of their respective material properties
or assets is required for the Company's execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby, including, without limitation, the issuance, sale
and delivery of the Shares pursuant to this Agreement, except such as
have been obtained and such as may be required under foreign and state
securities or "Blue Sky" laws.
(viii) The Registration Statement has become effective under the
1933 Act, and, to the knowledge of such counsel, no stop order suspending
the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the
Commission; and any required filing of the Prospectus pursuant to Rule
424 under the 1933 Act has been made in accordance with said Rule 424.
(ix) To such counsel's knowledge, except as disclosed in the
Registration Statement or in the Prospectus, there is not now pending or
threatened, any litigation, action, suit or proceeding to which the
Company or any of its subsidiaries is or will be a party before or by any
court or governmental agency or body, which (A) might result in any
material adverse change in the condition, financial or otherwise, or in
the business, operations, earnings, prospects or properties of the
Company and its subsidiaries, taken as a whole, or (B) might materially
and adversely affect the property or assets of the Company and its
subsidiaries, taken as a whole, or (C) concerns the Company or any of its
subsidiaries and is required to be disclosed in the Prospectus, or (D)
could adversely affect the consummation of this Agreement and the
issuance of the Shares; to such counsel's knowledge, no contract or other
document is required to be described in the Registration Statement or in
the Prospectus or to be filed as an exhibit to the Registration Statement
that is not described therein or filed as required.
16
(x) Except as otherwise disclosed in the Prospectus, to such
counsel's knowledge, neither the Company nor any of its subsidiaries is
in violation of its respective charter or by-laws or other organizational
documents or in default in the performance of any obligation, agreement
or condition contained in any bond, debenture, note or any other evidence
of indebtedness or in any other material agreement, indenture or
instrument to which the Company or any of its subsidiaries is a party or
by which any of their respective properties or assets may be bound or
affected, except for any such violation that would not have a material
adverse effect on the business, operations, earnings, business prospects,
properties or condition (financial or otherwise) of the Company and its
subsidiaries taken as a whole.
(xi) To such counsel's knowledge, each of the Company and its
Significant Subsidiaries has such permits, licenses, franchises and
authorizations of governmental or regulatory authorities (together,
"permits"), including, without limitation, under any applicable
Environmental Law, as are necessary to own, lease and operate its
properties and to engage in the business currently conducted by it,
except such permits as to which the failure to own or possess will not in
the aggregate have a material adverse effect on the business, operations,
earnings, business prospects, properties or condition (financial or
otherwise) of the Company and its subsidiaries, taken as a whole.
(xii) The Registration Statement and the Prospectus and any
supplements or amendments thereto (except for the financial statements
and the notes thereto and the schedules and other financial data included
therein, as to which such counsel need not express any opinion) comply as
to form in all material respects with the requirements of the 1933 Act.
(xiii) Each document incorporated by reference in the Registration
Statement and in the Prospectus (except for the financial statements and
the notes thereto and the schedules and other financial data included
therein, as to which such counsel need not express any opinion) complied
as to form when filed with the Commission in all material respects with
the requirements of the 1934 Act.
(xiv) To the extent required to be described therein, the Shares
conform in all material respects to the descriptions in the Registration
Statement and the Prospectus.
(xv) The statements (a) in the Prospectus under the captions
"Description of Shares", "Redemption; Business Combinations and Control
Share Acquisitions," "Limitation of Liability; Shareholder Liability" and
"Federal Income Tax and ERISA Considerations" and (b) in Item 1 of the
Company's Annual Report on Form 10-K for the fiscal year ended December
31, 2002 under the captions "Federal Income Tax Considerations" and
"ERISA Plans, Xxxxx Plans and Individual Retirement Accounts" in each
case insofar as they purport to summarize matters arising under
Massachusetts or Maryland law or the federal law of the United States, or
provisions of documents to which the Company is a party specifically
referred to therein, are accurate summaries of such legal matters or
provisions.
17
(xvi) The Company has qualified to be taxed as a real estate
investment trust pursuant to Sections 856-860 of the Code for each of the
fiscal years ended December 31, 1987 through December 31, 2002, and the
Company's current anticipated investments and its current plan of
operation will enable it to continue to meet the requirements for
qualification and taxation as a real estate investment trust under the
Code; actual qualification of the Company as a real estate investment
trust under the Code, however, will depend upon the Company's continued
ability to meet, and its meeting, through actual annual operating results
and distributions, the various qualification tests imposed under the
Code.
(xvii) The Company is not required to register as an "investment
company" under the 1940 Act.
(xviii) The Advisor (A) is a limited liability company duly
organized, validly existing and in good standing under the laws of the
State of Delaware, and (B) has the requisite limited liability company
power and authority to conduct its business as described in the
Prospectus and to own and operate its material properties.
(xix) The Advisory Agreement has been duly authorized, executed and
delivered by the parties thereto and constitutes the valid agreement of
the parties thereto, enforceable in accordance with its terms, except (a)
as limited by the effect of bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium or other similar laws relating to or
affecting the rights or remedies of creditors, (b) as limited by the
effect of general principles of equity (regardless of whether enforcement
is sought in a proceeding in equity or at law) and (c) insofar as the
enforceability of the indemnity and contribution provisions contained in
such agreement may be limited by federal or state securities laws and the
public policy underlying such laws.
(xx) Although counsel has not undertaken, except as otherwise
indicated in their opinion, to determine independently, and does not
assume any responsibility for, the accuracy or completeness of the
statements in the Registration Statement, such counsel has participated
in the preparation of the Registration Statement and the Prospectus,
including review and discussion of the contents thereof (including review
and discussion of the contents of all documents incorporated by reference
in the Registration Statement and the Prospectus), and nothing has come
to the attention of such counsel that has caused it to believe that the
Registration Statement (including the documents incorporated by reference
therein) at the time the Registration Statement became effective, or the
Prospectus, as of its date and as of Closing Time, as the case may be,
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading or that any amendment or supplement to
the Prospectus, as of its respective date, and as of Closing Time, as the
case may be, contained any untrue statement of a material fact or omitted
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 (it being understood that such counsel need express no
view with respect to the financial statements and the notes thereto and
the schedules and other financial data included or incorporated by
reference in the Registration Statement or in the Prospectus.
18
In rendering their opinion as aforesaid, Xxxxxxxx & Worcester LLP
may rely upon an opinion, dated as of Closing Time, of Xxxxxxx, Xxxxxxx
and Xxxxxx, LLP as to matters governed by Maryland law, provided that
such reliance is expressly authorized by such opinion and a copy of such
opinion is delivered to the Underwriters and is, in form and substance,
satisfactory to the Representative and counsel for the Underwriters. In
addition, in rendering such opinion, such counsel may state that their
opinion as to laws of the State of Delaware is limited to the Delaware
General Corporation Law and that their opinion with respect to the
qualification of the Company and its subsidiaries to do business in
jurisdictions other than their respective jurisdictions of organization
is based solely upon certificates to such effect issued by an appropriate
official of the applicable jurisdictions.
The opinion of Xxxxxxx, Xxxxxxx and Xxxxxx, LLP described in the
paragraph above shall be rendered to the Underwriters at the request of
the Company and shall so state therein.
(c) The Underwriters shall have received at Closing Time an opinion,
dated as of Closing Time, of Xxxxxx Xxxxxx Xxxxx & Xxxx LLP, counsel for the
Underwriters, as to the matters referred to in clauses (ii)(B), (v), (viii),
(xii), (xiv) and (xx) of the foregoing paragraph (b). In giving such opinion
with respect to the matters covered by clause (xx), such counsel may state that
their opinion and belief are based upon their participation in the preparation
of the Registration Statement and the Prospectus and any amendments or
supplements thereto and review and discussion of the contents thereof, but are
without independent check or verification except as specified.
In rendering their opinion as aforesaid, Xxxxxx Xxxxxx Xxxxx & Xxxx LLP
may rely upon an opinion, dated as of Closing Time, of Xxxxxxx, Xxxxxxx and
Xxxxxx, LLP as to matters governed by Maryland law, and the opinion of Xxxxxxxx
& Worcester LLP referred to above as to matters governed by Massachusetts law.
In addition, in rendering such opinion, such counsel may state that its opinion
as to laws of the State of Delaware is limited to the Delaware General
Corporation Law.
(d) At Closing Time (i) the Registration Statement and the Prospectus
shall contain all statements which are required to be stated therein in
accordance with the 1933 Act and the 1933 Act Regulations and in all material
respects shall conform to the requirements of the 1933 Act and the 1933 Act
Regulations, and neither the Registration Statement nor the Prospectus shall
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading and no action, suit or proceeding at law or in equity shall be
pending or to the knowledge of the Company threatened against the Company which
would be required to be set forth in the Prospectus other than as set forth
therein, (ii) there shall not have been, since the respective dates as of which
information is given in the Registration Statement and the Prospectus, any
material adverse change in the condition, financial or otherwise, of the Company
or in its earnings, business affairs or business prospects, whether or not
arising in the ordinary course of business from that set forth in the
Registration Statement, and (iii) no proceedings shall be pending or, to the
knowledge of the Company, threatened against the Company before or by any
federal, state or other court, commission, board or administrative agency
wherein an unfavorable decision, ruling
19
or finding would materially and adversely affect the business, property,
financial condition or income of the Company other than as set forth in the
Prospectus; and the Representative shall have received, at Closing Time, a
certificate of the President and Chief Operating Officer and the Chief Financial
Officer of the Company, dated as of Closing Time, evidencing compliance with the
provisions of this subsection (d) and stating that the representations and
warranties set forth in Section 1(a) hereof are accurate as though expressly
made at and as of Closing Time.
(e) At Closing Time, there shall not have been, since the respective
dates as of which information is given in the Registration Statement and the
Prospectus, any material adverse change in the business, operations, earnings,
prospects, properties or condition (financial or otherwise) of the Advisor,
whether or not arising in the ordinary course of business; and the Underwriters
shall have received, at Closing Time, a certificate of the President of the
Advisor evidencing compliance with this subsection (e).
(f) Concurrently with the execution and delivery of this Agreement, and
at Closing Time prior to payment and delivery of the Shares, Ernst & Young LLP
shall have furnished to the Representative a letter, dated the date of its
delivery, addressed to the Underwriters and in form and substance satisfactory
to the Representative, confirming that they are independent accountants with
respect to the Company as required by the 1933 Act and the 1933 Act Regulations
and with respect to the financial and other statistical and numerical
information contained in the Registration Statement and the Prospectus or
incorporated by reference therein. Each such letter shall contain information of
the type customarily included in accountants' comfort letters to underwriters.
(g) At Closing Time counsel for the Underwriters shall have been
furnished with such documents and opinions as it may reasonably require for the
purpose of enabling it to pass upon the issuance and sale of the Shares as
herein contemplated and related proceedings, or in order to evidence the
accuracy of any of the representations or warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Shares as herein contemplated shall
be reasonably satisfactory in form and substance to the Representative and
counsel for the Underwriters.
(h) In the event the Representative exercises the option described in
Section 2 hereof to purchase all or any portion of the Option Shares, the
representations and warranties of the Company included herein and the statements
in any certificates furnished by the Company hereunder shall be true and correct
as of the Date of Delivery, and the Underwriters shall have received:
(i) A certificate of the President and Chief Operating Officer and
the Chief Financial Officer of the Company, dated such Date of Delivery,
confirming that their certificate delivered at Closing Time pursuant to
Section 5(d) hereof remain true as of such Date of Delivery.
(ii) The favorable opinion of Xxxxxxxx & Worcester LLP, counsel for
the Company, in form and substance satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating to the Option Shares
and otherwise to the same effect as the opinion required by Section 5(b)
hereof.
20
(iii) Certificate of the President of the Advisor confirming that
his certificate delivered at Closing Time pursuant to Section 5(e) hereof
remains true as of such Date of Delivery.
(iv) The favorable opinion of Xxxxxx Xxxxxx Xxxxx & Xxxx LLP,
counsel for the Underwriters, dated such Date of Delivery, relating to
the Option Shares and otherwise to the same effect as the opinion
required by Section 5(c) hereof.
(v) A letter from Xxxxx & Young LLP, in form and substance
satisfactory to the Representative, dated such Date of Delivery,
substantially the same in scope and substance as the letter furnished to
the Underwriters pursuant to Section 5(f) hereof.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Representative by notice to the Company at any time at or prior to
Closing Time, and such termination shall be without liability of any party to
any other party except as provided in Section 4 hereof.
Section 6. INDEMNIFICATION. (a) The Company hereby agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls each
Underwriter within the meaning of Section 15 of the 1933 Act as follows:
(1) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary
to make the statements therein not misleading or arising out of any
untrue statement or alleged untrue statement of a material fact included
in any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto), or the omission, or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(2) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, if such settlement is effected with
the written consent of the Company; and
(3) against any and all expense whatsoever, as incurred (including,
subject to Section 6(c) hereof, the fees and disbursements of counsel
chosen by Xxxxxxx Xxxxx), reasonably incurred in investigating, preparing
or defending against any litigation, or any investigation or proceedings
by any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or
21
omission, to the extent that any such expense is not paid under paragraph
(1) or (2) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through Xxxxxxx Xxxxx expressly for use in the Registration
Statement (or any amendment thereto) or the Prospectus (or any amendment or
supplement thereto); and provided, further, that the foregoing indemnity
agreement with respect to any preliminary prospectus shall not inure to the
benefit of any Underwriter, or the benefit of any person controlling any
Underwriter, if a copy of the Prospectus (as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto and excluding
documents incorporated or deemed to be incorporated by reference therein) was
not sent or given by or on behalf of such Underwriter to such person asserting
any such losses, claims, damages or liabilities at or prior to the written
confirmation of the sale of such Shares to such person, if required by law so to
have been delivered, and if the Prospectus (as so amended or supplemented) would
have cured the defect giving rise to such loss, claim, damage or expense.
(b) Each Underwriter agrees to indemnify and hold harmless the Company,
each of the Company's trustees, each of the Company's officers who signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section 6, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto) or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through Xxxxxxx Xxxxx expressly for
use in the Registration Statement (or any amendment thereto) or the Prospectus
(or any amendment or supplement thereto).
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
which it may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the defense of such
action. In no event shall the indemnifying parties be liable for fees and
expenses of more than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in connection with any one
action or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances.
Section 7. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 6 hereof is for any reason held to be unenforceable by the indemnified
parties although applicable in accordance with its terms, the Company and the
Underwriters shall contribute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by said indemnity agreement
incurred by the Company and the Underwriters, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the
22
Underwriters on the other hand from the offering of the Shares pursuant to this
Agreement or (ii) if the allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and of the Underwriters on the other hand in
connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other hand in connection with the offering of the Shares
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Shares pursuant
to this Agreement (before deducting expenses) received by the Company and the
total discount received by the Underwriters, bear to the aggregate initial
offering price of the Shares.
The relative fault of the Company on the one hand and the Underwriters on
the other hand shall be determined by reference to, among other things, whether
any such untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by the
Company or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation or by any other method of allocation which does not take into account
the equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
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. Notwithstanding the
provisions of this Section 7, the Underwriters shall not be required to
contribute any amount in excess of the amount by which the total price at which
the Shares purchased from the Company by the Underwriters and distributed to the
public were offered to the public exceeds the amount of any damages which the
Underwriters have otherwise been required to pay in respect of such losses,
liabilities, claims, damages and expenses. For purposes of this Section 7, each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the 1933 Act shall have the same rights to contribution as such Underwriter, and
each trustee of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act shall have the same rights to
contribution as the Company.
Section 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company submitted pursuant
hereto, shall remain operative and in full force and
23
effect, regardless of any investigation made by or on behalf of the Underwriters
or any controlling person, or by or on behalf of the Company, and shall survive
delivery of the Shares to the Underwriters.
Section 9. TERMINATION OF AGREEMENT. (a) The Representative may terminate
this Agreement, by notice to the Company, at any time at or prior to Closing
Time (i) if there has been, since the respective dates as of which information
is given in the Registration Statement, 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, taken as a whole, or the
Advisor, whether or not arising in the ordinary course of business, which would
make it, in the Representative's reasonable judgment, impracticable or
inadvisable to market the Shares or enforce contracts for the sale of the
Shares, (ii) if there has occurred any material adverse change in the financial
markets in the United States or any outbreak of hostilities or escalation of
existing hostilities or other calamity or any change or development involving a
prospective change in national or international political, financial or economic
conditions, in each case the effect of which is such to make it, in the
Representative's reasonable judgment, impracticable or inadvisable to market the
Shares or enforce contracts for the sale of the Shares, or (iii) if trading in
the Company's Common Shares has been suspended by the Commission, or if trading
generally on either the New York Stock Exchange or the American Stock Exchange
has 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
a material disruption has occurred in commercial banking or securities
settlement or clearance services in the United States, or (iv) if a banking
moratorium has been declared by Federal or New York authorities.
(b) If this Agreement is terminated pursuant to this Section 9, such
termination shall be without liability of any party to any other party except as
provided in Section 4, and provided further that Sections 6 and 7 hereof shall
survive such termination.
Section 10. DEFAULT. If one or more of the Underwriters shall fail at
Closing Time to purchase the Initial Shares which it or they are obligated to
purchase under this Agreement (the "Defaulted Shares"), the Representative shall
have the right, within 24 hours thereafter, to make arrangements for one or more
of the non-defaulting Underwriters, or any other underwriters, to purchase all,
but not less than all, of the Defaulted Shares in such amounts as may be agreed
upon and upon the terms herein set forth; if, however, the Representative shall
not have completed such arrangements within such 24-hour period, then:
(i) if the number of Defaulted Shares does not exceed 10% of the
Initial Shares, the non-defaulting Underwriters shall be obligated to
purchase the full amount thereof in the proportions that their respective
underwriting obligations hereunder bear to the underwriting obligations
of all non-defaulting Underwriters, or
(ii) if the number of Defaulted Shares exceeds 10% of the Initial
Shares, this Agreement shall terminate without liability on the part of
any non-defaulting Underwriter and the Company.
24
No action taken pursuant to this Section 10 shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement, either the Representative or the Company shall have the right
to postpone Closing Time for a period not exceeding seven days in order to
effect any required changes in the Prospectus or in any other documents or
arrangements.
Section 11. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx
Incorporated at 0 Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX 10080, Attention: Xxxx
Xxxxx, Director; and notices to the Company shall be directed to it at 000
Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxx X. Xxxxx, Secretary.
Section 12. PARTIES. This Agreement shall inure to the benefit of and be
binding upon the Underwriters and the Company and their respective successors.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other than those referred to
in Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the parties
hereto and their respective successors and said controlling persons and
officers, trustees and directors and their heirs and legal representatives, and
for the benefit of no other person, firm or corporation. No purchaser of Shares
from any Underwriter shall be deemed to be a successor by reason merely of such
purchase.
Section 13. GOVERNING LAW AND TIME; MISCELLANEOUS. 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.
THE AMENDED AND RESTATED DECLARATION OF TRUST ESTABLISHING THE COMPANY,
DATED JULY 1, 1994, A COPY OF WHICH, TOGETHER WITH ALL AMENDMENTS AND
SUPPLEMENTS THERETO (THE "DECLARATION"), IS DULY FILED IN THE OFFICE OF THE
STATE DEPARTMENT OF ASSESSMENTS AND TAXATION OF MARYLAND, PROVIDES THAT THE NAME
"HRPT PROPERTIES TRUST" REFERS TO THE TRUSTEES UNDER THE DECLARATION
COLLECTIVELY AS TRUSTEES, BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO
TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE OR AGENT OF THE COMPANY SHALL BE HELD TO
ANY PERSONAL LIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM
AGAINST, THE COMPANY. ALL PERSONS DEALING WITH THE COMPANY, IN ANY WAY, SHALL
LOOK ONLY TO THE ASSETS OF THE COMPANY FOR THE PAYMENT OF ANY SUM OR THE
PERFORMANCE OF ANY OBLIGATION.
25
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument along with all counterparts will become a binding agreement between
the Underwriters and the Company in accordance with its terms.
Very truly yours,
HRPT PROPERTIES TRUST
By /s/ Xxxx X. Xxxxx
-------------------------------------
Name: Xxxx X. Xxxxx
Title: Treasurer and Chief Financial
Officer
CONFIRMED AND ACCEPTED, as of the date first above written:
XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
X.X. XXXXXXX & SONS, INC.
XXXX XXXXX XXXX XXXXXX INCORPORATED
UBS SECURITIES LLC
WACHOVIA SECURITIES, LLC
By: Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
By /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
26
EXECUTION COPY
SCHEDULE A
NUMBER OF
NAME OF UNDERWRITER INITIAL SHARES
------------------- --------------
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated..................................................... 2,650,000
X.X. Xxxxxxx & Sons, Inc. ................................................... 2,650,000
Xxxx Xxxxx Xxxx Xxxxxx
Incorporated........................................................ 2,650,000
UBS Securities LLC........................................................... 2,650,000
Wachovia Securities, LLC..................................................... 2,650,000
----------
Total........................................................ 13,250,000
==========
