HERSHA HOSPITALITY TRUST 2,000,000 COMMON SHARES OF BENEFICIAL INTEREST CONTROLLED EQUITY OFFERINGSM SALES AGREEMENT
Exhibit
10.1
2,000,000
COMMON SHARES OF BENEFICIAL INTEREST
CONTROLLED
EQUITY OFFERINGSM
April
5,
2007
CANTOR
▇▇▇▇▇▇▇▇▇▇ & CO.
▇▇▇
▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇ ▇▇▇▇▇
Ladies
and Gentlemen:
HERSHA
HOSPITALITY TRUST a Maryland real estate investment trust (the “Company”)
and
Hersha Hospitality Limited Partnership, a Virginia limited partnership (the
“Operating
Partnership”) ,
confirms
its agreement (this “Agreement”)
with
Cantor ▇▇▇▇▇▇▇▇▇▇ & Co. (“CF&Co”),
as
follows:
1. Issuance
and Sale of Shares.
The
Company agrees that, from time to time during the term of this Agreement, on
the
terms and subject to the conditions set forth herein, it may issue and sell
through CF&Co, acting as agent and/or principal, up to 2,000,000 of the
Company’s common shares of beneficial interest, par value $0.01 per
share (the
“Shares”).
The
issuance and sale of Shares through CF&Co will be effected pursuant to the
Registration Statement (as defined below) filed by the Company and declared
effective by the Securities and Exchange Commission (the “Commission”),
although nothing in this Agreement shall be construed as requiring the Company
to use the Registration Statement to issue the Shares.
The
Company has filed, in accordance with the provisions of the Securities Act
of
1933, as amended, and the rules and regulations thereunder (collectively, the
“Securities
Act”),
with
the Commission a registration statement on Form S-3 (File No. 333-138038),
including a base prospectus, relating to certain securities, including the
Shares to be issued from time to time by the Company, and which incorporates
by
reference documents that the Company has filed or will file in accordance with
the provisions of the Securities Exchange Act of 1934, as amended, and the
rules
and regulations thereunder (collectively, the “Exchange
Act”).
The
Company has prepared a prospectus supplement specifically relating to the Shares
(the “Prospectus
Supplement”)
to the
base prospectus included as part of such registration statement. The Company
has
furnished to CF&Co, for use by CF&Co, copies of the prospectus included
as part of such registration statement, as supplemented by the Prospectus
Supplement, relating to the Shares. Except where the context otherwise requires,
such registration statement, as amended when it became effective, including
all
documents filed as part thereof or incorporated by reference therein, and
including any information contained in a Prospectus (as defined below)
subsequently filed with the Commission pursuant to Rule 424(b) under the
Securities Act or deemed to be a part of such registration statement pursuant
to
Rule 430B of the Securities Act, is herein called the “Registration
Statement.”
The
base prospectus, including all documents incorporated therein by reference,
included in the Registration Statement, as it may be supplemented by the
Prospectus Supplement, in the form in which such prospectus and/or Prospectus
Supplement have most recently been filed by the Company with the Commission
pursuant to Rule 424(b) under the Securities Act, together with any “issuer free
writing prospectus,” as defined in Rule 433 of the Securities Act Regulations
(“Rule
433”),
relating to the Shares that (i) is required to be filed with the Commission
by
the Company or (ii) is exempt from filing pursuant to Rule 433(d)(5)(i), in
each
case in the form filed or required to be filed with the Commission or, if not
required to be filed, in the form retained in the Company’s records pursuant to
Rule 433(g), is herein called the “Prospectus.”
Any
reference herein to the Registration Statement, the Prospectus or any amendment
or supplement thereto shall be deemed to refer to and include the documents
incorporated by reference therein, and any reference herein to the terms
“amend,” “amendment” or “supplement” with respect to the Registration Statement
or the Prospectus shall be deemed to refer to and include the filing after
the
execution hereof of any document with the Commission deemed to be incorporated
by reference therein. For purposes of this Agreement, all references to the
Registration Statement, the Prospectus or to any amendment or supplement thereto
shall be deemed to include any copy filed with the Commission pursuant to its
Electronic Data Gathering Analysis and Retrieval System (“▇▇▇▇▇”).
2. Placements.
Each
time that the Company wishes to issue and sell Shares hereunder (each, a
“Placement”),
it
will notify CF&Co by email notice (or other method mutually agreed to in
writing by the parties) containing the parameters in accordance with which
it
desires the Shares to be sold, which shall at a minimum include the number
of
Shares to be issued (the “Placement
Shares”),
the
time period during which sales are requested to be made, any limitation on
the
number of Shares that may be sold in any one day and any minimum price below
which sales may not be made (a “Placement
Notice”),
a
form of which containing such minimum sales parameters necessary is attached
hereto as Schedule
1.
The
Placement Notice shall originate from any of the individuals from the Company
set forth on Schedule
2 (with
a
copy to each of the other individuals from the Company listed on such schedule),
and shall be addressed to each of the individuals from CF&Co set forth on
Schedule
2,
as such
Schedule
2
may be
amended from time to time. The Placement Notice shall be effective upon receipt
by CF&Co unless and until (i) in accordance with the notice requirements set
forth in Section
4,
CF&Co declines to accept the terms contained therein for any reason, in its
sole discretion, (ii) the entire amount of the Placement Shares have been sold,
(iii) in accordance with the notice requirements set forth in Section
4,
the
Company suspends or terminates the Placement Notice, (iv) the Company issues
a
subsequent Placement Notice with parameters superseding those on the earlier
dated Placement Notice, or (iv) the Agreement has been terminated under the
provisions of Section
11.
The
amount of any discount, commission or other compensation to be paid by the
Company to CF&Co in connection with the sale of the Placement Shares shall
be calculated in accordance with the terms set forth in Schedule
3.
It is
expressly acknowledged and agreed that neither the Company nor CF&Co will
have any obligation whatsoever with respect to a Placement or any Placement
Shares unless and until the Company delivers a Placement Notice to CF&Co and
CF&Co does not decline such Placement Notice pursuant to the terms set forth
above, and then only upon the terms specified therein and herein. In the event
of a conflict between the terms of this Agreement and the terms of a Placement
Notice, the terms of the Placement Notice will control.
3. Sale
of Placement Shares by CF&Co.
Subject
to the terms and conditions herein set forth, upon the Company’s issuance of a
Placement Notice, and unless the sale of the Placement Shares described therein
has been declined, suspended, or otherwise terminated in accordance with the
terms of this Agreement, CF&Co, for the period specified in the Placement
Notice, will use its commercially reasonable efforts consistent with its normal
trading and sales practices to sell such Placement Shares up to the amount
specified, and otherwise in accordance with the terms of such Placement Notice.
CF&Co will provide written confirmation to the Company no later than the
opening of the Trading Day (as defined below) immediately following the Trading
Day on which it has made sales of Placement Shares hereunder setting forth
the
number of Placement Shares sold on such day, the compensation payable by the
Company to CF&Co pursuant to Section
2
with
respect to such sales, and the Net Proceeds (as defined below) payable to the
Company, with an itemization of the deductions made by CF&Co (as set forth
in Section
5(a))
from
the gross proceeds that it receives from such sales. After consultation to
the
Company and subject to the terms of the Placement Notice, CF&Co may sell
Placement Shares by any method permitted by law deemed to be an “at the market”
offering as defined in Rule 415 of the Securities Act, including without
limitation sales made directly on the American Stock Exchange (the
“Exchange”),
on
any other existing trading market for the Shares or to or through a market
maker. After consultation with the Company and subject to the terms of the
Placement Notice, CF&Co may also sell Placement Shares in privately
negotiated transactions. The Company acknowledges and agrees that (i) there
can
be no assurance that CF&Co will be successful in selling Placement Shares,
and (ii) CF&Co will incur no liability or obligation to the Company or any
other person or entity if it does not sell Placement Shares for any reason
other
than a failure by CF&Co to use its commercially reasonable efforts
consistent with its normal trading and sales practices to sell such Placement
Shares as required under this Section
3.
For the
purposes hereof, “Trading
Day”
means
any day on which the Company’s common shares of beneficial interest are
purchased and sold on the principal market on which the common shares of
beneficial interest are listed or quoted.
4. Suspension
of Sales.
The
Company or CF&Co may, upon notice (the “Suspension
Notice”)
to the
other party in writing (including by email correspondence to each of the
individuals of the other Party set forth on Schedule
2,
if
receipt of such correspondence is actually acknowledged by any of the
individuals to whom the notice is sent, other than via auto-reply) or by
telephone (confirmed immediately by verifiable facsimile transmission or email
correspondence to each of the individuals of the other Party set forth on
Schedule
2),
suspend any sale of Placement Shares; provided,
however,
that
such suspension shall not affect or impair either party’s obligations with
respect to any Placement Shares sold hereunder prior to the receipt of such
notice. Each of the Parties agrees that no such notice under this Section
4
shall be
effective against the other unless it is made to one of the individuals named
on
Schedule
2
hereto,
as such Schedule may be amended from time to time.
5. Settlement.
(a)
Settlement
of Placement Shares.
Unless
otherwise specified in the applicable Placement Notice, settlement for sales
of
Placement Shares will occur on the third (3rd)
Trading
Day (or such earlier day as is industry practice for regular-way trading)
following the date on which such sales are made (each, a “Settlement
Date”).
The
amount of proceeds to be delivered to the Company on a Settlement Date against
receipt of the Placement Shares sold (the “Net
Proceeds”)
will
be equal to the aggregate sales price received by CF&Co at which such
Placement Shares were sold, after deduction for (i) CF&Co’s commission,
discount or other compensation for such sales payable by the Company pursuant
to
Section
2
hereof,
(ii) any other amounts due and payable by the Company to CF&Co hereunder
pursuant to Section
7(h)
(Expenses) hereof, and (iii) any transaction fees imposed by any governmental
or
self-regulatory organization in respect of such sales.
(b)
Delivery
of Placement Shares.
On or
before each Settlement Date, the Company will, or will cause its transfer agent
to, electronically transfer the Placement Shares being sold by crediting
CF&Co’s or its designee’s account (provided CF&Co
shall
have given the Company written notice of such designee prior to the Settlement
Date) at The Depository Trust Company through its Deposit and Withdrawal at
Custodian System or by such other means of delivery as may be mutually agreed
upon by the parties hereto which in all cases shall be freely tradeable,
transferable, registered shares in good deliverable form. On each Settlement
Date, CF&Co will deliver the related Net Proceeds in same day funds to an
account designated by the Company on, or prior to, the Settlement Date. The
Company agrees that if the Company, or its transfer agent (if applicable),
defaults in its obligation to deliver Placement Shares on a Settlement Date,
the
Company agrees that in addition to and in no way limiting the rights and
obligations set forth in Section
9(a)
(Indemnification and Contribution) hereto, it will (i) hold CF&Co
harmless against any loss, claim, damage, or expense (including reasonable
legal
fees and expenses), as incurred, arising out of or in connection with such
default by the Company and (ii) pay to CF&Co any commission, discount, or
other compensation to which it would otherwise have been entitled absent such
default.
6. Representations
and Warranties of the Company and the Operating Partnership.
The
Company and Hersha Hospitality Limited Partnership, a Virginia limited
partnership (the “Operating
Partnership”), jointly
and severally represent and warrant to, and agree with, CF&Co that as of the
date of this Agreement and as of each Representation Date (as defined in
Section
7(n)
below)
on which a certificate is required to be delivered pursuant to Section
7(n)
of this
Agreement and as of each Applicable Time, as the case may be:
(a) The
Company satisfies all of the requirements of the Securities Act for use of
Form
S-3 for the offering of the Shares contemplated hereby.
(b)
The
Registration Statement has been filed with the Commission and has been declared
effective under the Securities Act. No stop order suspending the effectiveness
of the Registration Statement has been issued under the Securities Act and
no
proceedings for that purpose have been instituted or are pending or, to the
knowledge of the Company, are contemplated by the Commission, and any request
on
the part of the Commission for additional information has been complied
with.
(c)
Intentionally
omitted.
(d)
The
Company has delivered to CF&Co one complete copy of the Registration
Statement and a copy of each consent and certificate of experts filed as a
part
thereof, and conformed copies of the Registration Statement (without exhibits)
and the Prospectus, as amended or supplemented, in such quantities and at such
places as CF&Co has reasonably requested. The Prospectus delivered to
CF&Co for use in connection with the offering of Shares will, at the time of
such delivery, be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted
by
Regulation S-T.
(e)
At
the
respective times the Registration Statement and each amendment thereto became
effective, at each deemed effective date with respect to CF&Co pursuant to
Rule 430B(f)(2) of the Securities Act, as the case may be, the Registration
Statement complied and will comply in all material respects with the
requirements of the Securities Act, and did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading.
The
preceding sentence does not apply to statements in or omissions from the
Registration Statement or any amendment thereto in reliance upon and in
conformity with written information relating to CF&Co furnished to the
Company in writing by CF&Co expressly for use therein, it being understood
and agreed that the only such information furnished by CF&Co consists of the
information described as such in Schedule
4
hereto.
(f)
Neither
the Prospectus nor any amendments or supplements thereto, at the time the
Prospectus or any such amendment or supplement was issued, as of the date
hereof, each Applicable Time, and at each Representation Date, as the case
may
be, included or will include an untrue statement of a material fact or omitted
or will omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. The preceding sentence does not apply to statements in or omissions
from the Prospectus, as amended or supplemented, in reliance upon and in
conformity with written information relating to CF&Co furnished to the
Company in writing by CF&Co expressly for use therein, it being understood
and agreed that the only such information furnished by CF&Co consists of the
information described as such in Schedule
4
hereto.
(g)
Each
document incorporated by reference in the Registration Statement or the
Prospectus heretofore filed, when it was filed (or, if any amendment with
respect to any such document was filed, when such amendment was filed),
conformed in all material respects with the requirements of the Exchange Act
and
the rules and regulations thereunder, and any further documents so filed and
incorporated after the date of this Agreement will, when they are filed, conform
in all material respects with the requirements of the Exchange Act and the
rules
and regulations thereunder; no such document when it was filed (or, if an
amendment with respect to any such document was filed, when such amendment
was
filed), contained an untrue statement of a material fact or omitted to state
a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading; and no such document, when it is filed,
will
contain an untrue statement of a material fact or will omit to state a material
fact required to be stated therein or necessary in order to make the statements
therein not misleading.
(h)
Each
issuer free writing prospectus (as defined in Rule 433), as of its issue date
and at all subsequent times through the completion of the public offer and
sale
of the Shares or until any earlier date that the Company notifies CF&Co in
writing, did not, does not and will not include any information that conflicted,
conflicts or will conflict with the information contained in the Registration
Statement or the Prospectus, including any incorporated document deemed to
be a
part thereof that has not been superseded or modified. The foregoing sentence
does not apply to statements in or omissions from any issuer free writing
prospectus based upon and in conformity with written information furnished
to
the Company by CF&Co specifically for use therein, it being understood and
agreed that the only such information furnished by CF&Co consists of the
information described as such in Schedule
4
hereto.
(i)
All
of
the issued and outstanding shares of capital stock of the Company have been
duly
authorized and validly issued, are fully paid and nonassessable and have been
issued in compliance with applicable federal and state securities laws. None
of
the Company’s outstanding common shares or preferred stock were issued in
violation of any preemptive rights, rights of first refusal or other similar
rights; except as set forth in the Prospectus, the Company is not a party to
or
bound by any outstanding options, warrants or similar rights to subscribe for,
or contractual obligations to issue, sell, transfer or acquire, any of its
capital stock or any securities convertible into or exchangeable for any of
such
capital stock; the Shares to be issued and sold by the Company hereunder have
been duly authorized and, when issued and delivered against full payment
therefor in accordance with the terms hereof will be validly issued, fully
paid
and nonassessable and free of any preemptive rights, rights of first refusal
or
other or similar rights; the capital stock (including the Shares) of the Company
conforms to the description thereof contained in the Prospectus; and the
delivery of the Shares being sold by the Company against payment therefor
pursuant to the terms of this Agreement will pass valid title to the Shares
being sold by the Company, free and clear of any claim, encumbrance or defect
in
title, and without notice of any lien, claim or encumbrance. The certificates
used by the Company to evidence the common shares or the preferred stock are
in
valid and sufficient form.
(j)
Immediately
after the transactions contemplated by this Agreement, all of the issued and
outstanding Common Units and Preferred Units (as defined below) will be validly
issued, fully paid and nonassessable. Immediately after the transactions
contemplated by this Agreement, none of the outstanding common units of limited
partnership interest in the Operating Partnership (“Common
Units”)
or
preferred units of limited partnership interest in the Operating Partnership
(“Preferred
Units”)
has
been issued in violation of any preemptive right, right of first refusal or
other similar right; and the outstanding Common Units and Preferred Units have
been offered, sold and issued by the Operating Partnership in compliance with
applicable federal and state securities laws.
(k)
Each
of
the Company and its subsidiaries is duly organized and validly existing in
good
standing under the laws of the state of its incorporation or organization with
full corporate, partnership or entity power and authority, as the case may
be,
to own, lease and operate its properties and to conduct its business as
presently conducted and as described in the Prospectus and is duly registered
and qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the conduct of
its
business requires such registration or qualification, except where the failure
to so register or qualify has not had or will not have a material adverse effect
on the condition (financial or other), business, properties, results of
operations or prospects of the Company and its subsidiaries, taken as a whole
(a
“Material
Adverse Effect”).
(l)
The
outstanding equity interests of each of the Company's subsidiaries have been
duly authorized and validly issued, are fully paid and nonassessable and are
owned by the Company, directly or through subsidiaries, free and clear of any
security interests, liens, encumbrances, equities or claims. The Company does
not have any subsidiaries and does not own a material interest in or control,
directly or indirectly, any other corporation, partnership, joint venture,
association, trust or other business organization, except as set forth in
Exhibit 21 to the Company's most recent Annual Report on Form 10-K incorporated
by reference into the Registration Statement, other than HT/PRA Glastonbury,
LLC
and those subsidiaries formed, or in which the Company has acquired a direct
or
indirect ownership interest, subsequent to the filing of the Company’s most
recent Annual Report on Form 10-K. As used in this Agreement, subsidiaries
shall
mean direct and indirect subsidiaries of the Company.
(m)
Except
as
described in the Prospectus, there is no action, suit, inquiry, proceeding
or
investigation by or before any court or governmental or other regulatory or
administrative agency or commission pending or, to the best knowledge of the
Company, threatened, against or involving the Company or its subsidiaries,
which
might individually or in the aggregate prevent or adversely affect the
transactions contemplated by this Agreement or result in a Material Adverse
Effect, nor to the Company's knowledge, is there any basis for any such action,
suit, inquiry, proceeding or investigation. There are no agreements, contracts,
indentures, leases or other instruments that are required to be described in
the
Prospectus or to be filed as an exhibit to the Registration Statement that
are
not described, filed or incorporated by reference in the Registration Statement
and the Prospectus as required by the Securities Act. All such contracts to
which the Company or any of its subsidiaries is a party have been duly
authorized, executed and delivered by the Company or the applicable subsidiary,
constitute valid and binding agreements of the Company or the applicable
subsidiary and are enforceable against the Company or the applicable subsidiary
in accordance with the terms thereof, except as enforceability thereof may
be
limited by (i) the application of bankruptcy, reorganization, insolvency and
other laws affecting creditors' rights generally and (ii) equitable principles
being applied at the discretion of a court before which any proceeding may
be
brought. Neither the Company nor the applicable subsidiary has received notice
or been made aware that any other party is in breach of or default to the
Company or its subsidiaries under any of such contracts.
(n)
Neither
the Company nor any of its subsidiaries is (i) in violation of (A) its
Organizational Documents, (B) to the Company's knowledge any law, ordinance,
administrative or governmental rule or regulation applicable to the Company
or
any of its subsidiaries, the violation of which would have a Material Adverse
Effect or (C) any decree of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries; or (ii) in default
in
any material respect in the performance of any obligation, agreement or
condition contained in (A) any bond, debenture, note or any other evidence
of
indebtedness or (B) any agreement, indenture, lease or other instrument (each
of
(A) and (B), an “Existing
Instrument”)
to
which the Company or any of its subsidiaries is a party or by which any of
their
properties may be bound, which default would have a Material Adverse Effect;
and
to the Company’s knowledge, there does not exist any state of facts that
constitutes a default or an event of default on the part of the Company or
any
of its subsidiaries as defined in such documents or that, with notice or lapse
of time or both, would constitute such a default or event of default which
would
have a Material Adverse Effect.
(o)
The
Company and the Operating Partnership have full legal right, power and authority
to enter into and perform this Agreement and to consummate the transactions
contemplated herein, including the issuance, sale and delivery of the Shares
as
provided herein and the Operating Partnership’s issuance of the Common Units to
the Company. The Company's and the Operating Partnership's execution and
delivery of this Agreement and the performance by the Company and the Operating
Partnership of their obligations under this Agreement have been duly and validly
authorized by the Company and the Operating Partnership and this Agreement
has
been duly executed and delivered by the Company and the Operating Partnership,
and constitutes a valid and legally binding agreement of the Company and the
Operating Partnership, enforceable against the Company and the Operating
Partnership in accordance with its terms, except to the extent enforceability
may be limited by (i) the application of bankruptcy, reorganization, insolvency
and other laws affecting creditors' rights generally and (ii) equitable
principles being applied at the discretion of a court before which any
proceeding may be brought, and except as rights to indemnity and contribution
hereunder may be limited by federal or state securities laws.
(p)
The
Amended and Restated Agreement of Limited Partnership of the Operating
Partnership, including all amendments thereto (the “Partnership
Agreement”),
has
been duly and validly authorized, executed and delivered by the general partner
of the Operating Partnership and constitutes a valid and binding agreement
of
the general partner, enforceable in accordance with its terms, except to the
extent that enforceability may be limited by bankruptcy, insolvency,
reorganization or other laws of general applicability relating to or affecting
creditors' rights or by general equity principles.
(q)
No
consent, approval, authorization, order, license, certificate, permit,
registration, designation or filing by or with any governmental agency or body
is required for the execution, delivery and performance by the Company and
the
Operating Partnership of their respective obligations under this Agreement
and
the consummation by the Company and the Operating Partnership of the
transactions contemplated hereby, including the valid authorization, issuance,
sale and delivery of the Shares, except such as may be required by (i) the
Exchange, (ii) the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares or (iii) the Company’s
Organizational Documents, all of which will be, or have been effected, in
accordance with this Agreement.
(r)
Neither
the issuance and sale of the Shares by the Company, the execution, delivery
or
performance of this Agreement by the Company and the Operating Partnership
nor
the consummation by the Company and the Operating Partnership of the
transactions contemplated hereby (i) conflicts with or will conflict with or
constitutes or will constitute a breach of, or a default under, the Company's
charter or bylaws, the Operating Partnership's certificate of limited
partnership or the Partnership Agreement, or any Existing Instrument to which
the Company or any of its subsidiaries is a party or by which any of its or
their properties may be bound, (iii) violates any statute, law, regulation,
ruling, filing, judgment, injunction, order or decree applicable to the Company
or any of its subsidiaries or any of their properties, or (iv) results in a
breach of, or default or Debt Repayment Triggering Event (as defined below)
under, or results in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, or requires the consent of any other party to, any
Existing Instrument, except for such conflicts, breaches, defaults, liens,
charges or encumbrances that will not, individually or in the aggregate, result
in a Material Adverse Effect. As used herein, a “Debt
Repayment Triggering Event”
means
any event or condition that gives, or with the giving of notice or lapse of
time
would give, the holder of any note, debenture or other evidence of indebtedness
(or any person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a portion of such indebtedness
by
the Company or any of its subsidiaries.
(s)
Other
than owners of Common Units by persons other than the Company, no holder of
any
securities of the Company has rights to the registration of any securities
of
the Company or other similar rights as a result of or in connection with the
filing of the Registration Statement or the consummation of the transactions
contemplated hereby that have not been satisfied or heretofore waived in
writing. No person or entity has a right of participation or first refusal
with
respect to the sale of the Shares by the Company.
(t)
KPMG
LLP
has audited the financial statements (including the related notes thereto and
supporting schedules) incorporated by reference in the Registration Statement
and the Prospectus, are and were, during the periods covered by their reports
incorporated by reference in the Registration Statement and the Prospectus,
independent registered public accountants as required by the Securities Act,
the
Exchange Act and the Public Company Accounting Oversight Board (“PCAOB”).
(u)
The
financial statements, together with related schedules and notes, included or
incorporated by reference in the Registration Statement and the Prospectus,
present fairly the financial condition, results of operations, cash flows and
changes in financial position of the Company on the basis stated in the
Registration Statement at the respective dates or for the respective periods
to
which they apply; such statements and related schedules and notes have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein; and the other financial and statistical information and data set forth
in the Registration Statement and Prospectus is accurately presented and
prepared on a basis consistent with such financial statements and the books
and
records of the Company. No other financial statements or schedules are required
by Form S-3 or otherwise to be included in the Registration Statement or the
Prospectus.
(v)
Except
as
disclosed in the Registration Statement and the Prospectus, subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus, (i) neither the Company nor any of its
subsidiaries has incurred any material liabilities or obligations, indirect,
direct or contingent, or entered into any transaction that is not in the
ordinary course of business, (ii) neither the Company nor any of its
subsidiaries has sustained any material loss or interference with its business
or properties from fire, flood, windstorm, accident or other calamity, whether
or not covered by insurance, (iii) except for the normal quarterly dividend
on
the common shares of beneficial interest and preferred shares of the Company,
neither the Company nor any of its subsidiaries has paid or declared any
dividends or other distributions with respect to its capital stock and the
Company is not in default under the terms of any class of capital stock of
the
Company or any outstanding debt obligations, (iv) there has not been any change
in the authorized or outstanding capital stock of the Company or any material
change in the indebtedness of the Company (other than in the ordinary course
of
business) and (v) there has not been any material adverse change, or any
development involving or that may reasonably be expected to result in a Material
Adverse Effect.
(w)
The
Shares to be sold under this Agreement have been approved for trading and
listing on the Exchange and are registered pursuant to Section 12(b) of the
Exchange Act, and the Company has taken no action designed to, or likely to
have
the effect of, terminating the registration of the Shares under the Exchange
Act
or delisting any such securities from the Exchange, nor has the Company received
any notification that the Commission or the Exchange is contemplating
terminating such registration or listing.
(x)
The
Company has not distributed and will not distribute any offering material in
connection with the offering and sale of the Shares to be sold hereunder by
CF&Co as principal or agent for the Company, other than the Prospectus and
the Registration Statement.
(y)
Other
than excepted activity pursuant to Regulation M under the Exchange Act, the
Company has not taken and will not take, directly or indirectly, any action
that
constituted, or any action designed to, or that might reasonably be expected
to
cause or result in or constitute stabilization or manipulation of the price
of
any security of the Company to facilitate the sale or resale of the Shares
or
for any other purpose.
(z)
The
Company and each of its subsidiaries have filed all tax returns required to
be
filed (other than certain state or local tax returns, as to which the failure
to
file, individually or in the aggregate, would not have a Material Adverse
Effect), which returns are complete and correct in all material respects, and
neither the Company nor any subsidiary is in default in the payment of any
taxes
that were payable pursuant to said returns or any assessments with respect
thereto. Except as disclosed in the Prospectus (as amended or supplemented),
all
deficiencies asserted as a result of any federal, state, local or foreign tax
audits have been paid or finally settled and no issue has been raised in any
such audit that, by application of the same or similar principles, reasonably
could be expected to result in a proposed deficiency for any other period not
so
audited. There are no outstanding agreements or waivers extending the statutory
period of limitation applicable to any federal, state, local or foreign tax
return for any period. On each Settlement Date, all stock transfer and other
taxes that are required to be paid in connection with the sale of the Shares
will have been fully paid by the Company and all laws imposing such taxes will
have been complied with.
(aa)
Except
as
set forth in the Prospectus (as amended or supplemented), there are no
transactions with “affiliates” (as defined in Rule 405 promulgated under the
Securities Act) or any officer, director or security holder of the Company
(whether or not an affiliate) that are required by the Securities Act to be
disclosed in the Prospectus that have not been disclosed as required.
Additionally, no relationship, direct or indirect, exists between the Company
or
any of its subsidiaries on the one hand, and the directors, officers,
stockholders, customers or suppliers of the Company or any subsidiary on the
other hand that is required by the Securities Act to be disclosed in the
Prospectus that is not so disclosed.
(bb)
None
of
the Company nor any of its subsidiaries is an “investment company”, a company
“controlled” by an “investment company” or an “affiliated person” of, or
“promoter” or “principal underwriter” for, an investment company within the
meaning of the Investment Company Act of 1940, as amended.
(cc)
Each
of
the Company and its subsidiaries has good and valid title to all property (real
and personal) described in the Prospectus as being owned by it, free and clear
of all liens, claims, security interests or other encumbrances except (i) such
as are described in the Prospectus or (ii) such as are not materially burdensome
and do not have or will not materially adversely affect the Company's or
subsidiaries' use of the property or the conduct of the business of the Company.
All property (real and personal) leased by the Company and its subsidiaries
is
held under valid, subsisting and enforceable leases with only such exceptions
as
in the aggregate are not materially burdensome and do not or will not adversely
affect the use of the property or the conduct of the business of the
Company.
(dd) The
Company and its subsidiaries have all permits, licenses, franchises, approvals,
consents and authorizations of governmental or regulatory authorities
(hereinafter “permit” or “permits”) as are necessary to own their properties and
to conduct their business in the manner described in the Prospectus, subject
to
such qualifications as may be set forth in the Prospectus, except where the
failure to have obtained any such permit has not had and will not have a
Material Adverse Effect; each of the Company and its subsidiaries has operated
and is operating its business in material compliance with all of its obligations
with respect to each such permit and no event has occurred that allows, or
after
notice or lapse of time would allow, revocation or termination of any such
permit and except where such revocation or termination would not have a Material
Adverse Effect or result in any other material impairment of the rights of
any
such permit, subject in each case to such qualification as may be set forth
in
the Prospectus; and, except as described in the Prospectus, such permits contain
no restrictions that are materially burdensome to the Company or any of its
subsidiaries.
(ee)
The
Company has established, maintains and evaluates disclosure controls and
procedures (as such term is defined in Rule 13a-15 and 15d-15 under the Exchange
Act) and “internal control over financial reporting” (as such term is defined in
Rule 13a-15 and 15d-15 under the Exchange Act) in accordance with such rules
and
any related rules of the Commission or the Exchange; such disclosure controls
and procedures 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 by others within those
entities, and except as disclosed in the Company’s Annual Report on Form 10-K
for the year ended December 31, 2006, as amended, such disclosure controls
and
procedures are effective to perform the functions for which they were
established.
(ff) Except
as
disclosed in the Prospectus or any Permitted Free Writing Prospectuses, the
Company and 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 authorization;
(ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting principles
and to maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets is compared
with existing assets at reasonable intervals and appropriate action is taken
with respect to any differences; and, to the Company’s and the Operating
Partnership’s knowledge, neither the Company, the Operating Partnership nor any
subsidiary, employee or agent thereof, has made any payment of funds of the
Company, the Operating Partnership or any of the subsidiaries, as the case
may
be, or received or retained any funds, and no funds of the Company, the
Operating Partnership or any of the subsidiaries, as the case may be, have
been
set aside to be used for any payment, in each case in violation of any law,
rule
or regulation.
(gg)
Based
on
evaluations of its internal controls over financial reporting, the Company
is
not aware of (i) any material weakness in the design or operation of internal
control over financial reporting which are reasonably likely to adversely affect
the Company's ability to record, process, summarize and report financial
information; or (ii) any fraud, whether or not material, that involves
management or other employees who have a significant role in the Company's
internal control over financial reporting.
(hh) Neither
the Company nor any of its subsidiaries, since each has been a subsidiary of
the
Company, nor, to the Company's knowledge, any employee or agent of the Company
or any of its subsidiaries, has, directly or indirectly, (i) made any unlawful
contribution to any candidate for political office, or failed to disclose fully
any contribution in violation of law or (ii) made any payment to any federal,
state, local or foreign governmental official, or other person charged with
similar public or quasi-public duties, other than payments required or permitted
by the laws of the United States or any jurisdiction thereof or applicable
foreign jurisdictions.
(ii)
The
Company and its subsidiaries are (i) in compliance with any and all applicable
federal, state, local and foreign laws and regulations relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (“Environmental
Laws”),
(ii)
have received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit, license
or
approval, except in each case as would not, individually or in the aggregate,
have a Material Adverse Effect. Neither the Company nor any of its subsidiaries
has been named as a “potentially responsible party” under the Comprehensive
Environmental Response Compensation and Liability Act of 1980, as amended.
Neither the Company nor any of its subsidiaries owns, leases or occupies any
property that appears on any list of hazardous sites compiled by any state
or
local governmental agency.
(jj)
There
are
no costs or liabilities associated with Environmental Laws (including, without
limitation, any capital or operating expenditures required for clean-up, closure
of properties or compliance with Environmental Laws or any permit, license
or
approval, any related constraints on operating activities and any potential
liabilities to third parties) which would, singly or in the aggregate, have
a
Material Adverse Effect.
(kk)
The
Company has been organized and has operated in conformity with the requirements
for qualification and taxation as a real estate investment trust under the
Internal Revenue Code of 1986, as amended (the “Code”)
for its
taxable years ended December 31, 1999 through December 31, 2006, and the
Company's current and proposed method of operation will enable it to continue
to
meet the requirements for taxation as a real estate investment trust under
the
Code for its taxable year ending December 31, 2007 and in the future. The
subsidiaries of the Company that are partnerships have been and will continue
to
be treated as partnerships for federal income tax purposes and not as
corporations, associations taxable as corporations or as publicly traded
partnerships.
(ll)
Intentionally
Omitted.
(mm)
The
Company and its subsidiaries own and have full right, title and interest in
and
to, or has valid licenses to use, each material trade name, trademark, service
▇▇▇▇, patent, copyright, approval, trade secret and other similar rights
(collectively “Intellectual
Property”)
under
which the Company and its subsidiaries conduct all or any material part of
their
business, and none of the Company and its subsidiaries has created any lien
or
encumbrance on, or granted any right or license with respect to, any such
Intellectual Property except where the failure to own or obtain a license or
right to use any such Intellectual Property has not and will not have a Material
Adverse Effect; there is no claim pending against the Company or any of its
subsidiaries with respect to any Intellectual Property, and none of the Company
and its subsidiaries has received notice or otherwise become aware that any
Intellectual Property that it uses or has used in the conduct of its business
infringes upon or conflicts with the rights of any third party. Neither the
Company nor any of its subsidiaries has become aware that any material
Intellectual Property that it uses or has used in the conduct of its business
infringes upon or conflicts with the rights of any third party.
(nn)
No
officer, director or nominee for director of the Company has a direct or
indirect affiliation or association with any member of the NASD.
(oo)
The
Company and its subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are prudent
and customary in the businesses in which they are engaged; and neither the
Company nor any of its subsidiaries has 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 comparable cost.
(pp)
Title
insurance in favor of the Company, the Operating Partnership and the
subsidiaries has been obtained with respect to each property owned by any such
entity in an amount at least equal to (A) the cost of acquisition of such
property or (B) the cost of construction of such property (measured at the
time of such construction), except where the failure to maintain such title
insurance would not have a Material Adverse Effect.
(qq)
In
the
ordinary course of its business, the Company conducts a periodic review of
the
effect of Environmental Laws on the business, operations and properties of
the
Company and its subsidiaries, in the course of which it identifies and evaluates
associated costs and liabilities (including any capital or operating
expenditures required for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related constraints
on operating activities and any potential liabilities to third parties). On
the
basis of such review and amount of its established reserves, the Company has
reasonably concluded that such associated costs and liabilities would not,
individually or in the aggregate, result in a Material Adverse
Effect.
(rr)
Except
for matters which would not, individually or in the aggregate, have a Material
Adverse Effect, (i) neither the Company, the Partnership nor any of the
subsidiaries is engaged in any unfair labor practice; (ii) there is
(A) no unfair labor practice complaint pending or, to the Company’s or the
Partnership’s knowledge after due inquiry, threatened against the Company, the
Partnership or any of the subsidiaries before the National Labor Relations
Board, and no grievance or arbitration proceeding arising out of or under
collective bargaining agreements is pending or threatened, (B) no strike,
labor dispute, slowdown or stoppage pending or, to the Company’s or the
Partnership’s knowledge after due inquiry, threatened against the Company, the
Partnership or any of the subsidiaries and (C) no union representation
dispute currently existing concerning the employees of the Company, the
Partnership, HHMLP or any of the subsidiaries, and (iii) to the Company’s
knowledge after due inquiry, (A) no union organizing activities are
currently taking place concerning the employees of the Company, the Partnership,
or any of the subsidiaries and (B) there has been no violation of any
federal, state, local or foreign law relating to discrimination in the hiring,
promotion or pay of employees, any applicable wage or hour laws or any provision
of the Employee Retirement Income Security Act of 1974 (“ERISA”)
or the
rules and regulations promulgated thereunder concerning the employees of the
Company, the Partnership, HHMLP or any of the Subsidiaries;
(ss)
The
Company and its subsidiaries have complied and will comply in all material
respects with wage and hour determinations issued by the U.S. Department of
Labor under the Service Contract Act of 1965 and the Fair Labor Standards Act
in
paying its employees' salaries, fringe benefits and other compensation for
the
performance of work or other duties in connection with contracts with the U.S.
government, and have complied and will comply in all material respects with
the
requirements of the Americans with Disabilities Act of 1990, the Family and
Medical Leave Act of 1993, the Civil Rights Act of 1964 (Title VII), the
National Labor Relations Act, the Vietnam Era Veteran's Readjustment Act, the
Age Discrimination in Employment Act, as amended by the Older Workers' Benefit
Protection Act, and federal, state and local labor laws, each as amended except
where the failure to comply with any such requirements has not, and will not,
have a Material Adverse Effect.
(tt)
Except
with respect to non-timely filings of reports pursuant to Section 16(a) of
the
Exchange Act by certain of the Company's officers as described in the Company's
Definitive Proxy Statement dated April 25, 2006 under the caption “Section 16(a)
Beneficial Ownership Reporting Compliance,” there is and has been no failure on
the part of the Company, the Operating Partnership and the subsidiaries and
any
of the officers and directors of the Company, the Operating Partnership and
any
of the subsidiaries, in their capacities as such, to comply in all material
respects with the provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the rules
and
regulations promulgated thereunder.
(uu)
Other
than this Agreement, there are no contracts, agreements or understandings
between the Company or any of its subsidiaries and any person that would give
rise to a valid claim against the Company or any of its subsidiaries or
CF&Co for a brokerage commission, finder’s fee or other like payment with
respect to the consummation of the transactions contemplated by this
Agreement.
(vv)
The
Company acknowledges and agrees that CF&Co has informed the Company that
CF&Co may, to the extent permitted under the
Securities Act
and the
Exchange Act, purchase and sell common shares or preferred stock of the Company
for its own account while this Agreement is in effect.
(ww) Any
certificate signed by an officer of the Company and delivered to CF&Co or to
counsel for CF&Co shall be deemed to be a representation and warranty by the
Company and/or the Operating Partnership, as applicable, to CF&Co as to the
matters set forth therein.
(xx)
The
Company and the Operating Partnership acknowledge that CF&Co and, for
purposes of the opinions to be delivered pursuant to Section
7
hereof,
counsel to the Company and counsel to CF&Co, will rely upon the accuracy and
truthfulness of the foregoing representations and hereby consents to such
reliance.
7. Covenants
of the Company.
The
Company and the Operating Partnership, jointly and severally, covenant and
agree
with CF&Co that:
(a)
Registration
Statement Amendments; Payment of Fees.
After
the date of this Agreement and during any period in which a Prospectus relating
to any Placement Shares is required to be delivered by CF&Co under the
Securities Act (including in circumstances where such requirement may be
satisfied pursuant to Rule 172 under the Securities Act), (i) the
Company will notify CF&Co promptly of the time when any subsequent amendment
to the Registration Statement, other than documents incorporated by reference,
has been filed with the Commission and/or has become effective or any subsequent
supplement to the Prospectus has been filed and of any comment letter from
the
Commission or any request by the Commission for any amendment or supplement
to
the Registration Statement or Prospectus or for additional information, (ii)
the
Company will prepare and file with the Commission, promptly upon CF&Co’s
request, any amendments or supplements to the Registration Statement or
Prospectus that, in CF&Co’s reasonable opinion, may be necessary or
advisable in connection with the distribution of the Placement Shares by
CF&Co (provided,
however,
that
the failure of CF&Co to make such request shall not relieve the Company of
any obligation or liability hereunder, or affect CF&Co’s right to rely on
the representations and warranties made by the Company in this Agreement);
(iii)
the Company will not file any amendment or supplement to the Registration
Statement or Prospectus, other than documents incorporated by reference,
relating to the Placement Shares or a security convertible into the Placement
Shares unless a copy thereof has been submitted to CF&Co within a reasonable
period of time before the filing and CF&Co has not reasonably objected
thereto (provided,
however,
that
the failure of CF&Co to make such objection shall not relieve the Company of
any obligation or liability hereunder, or affect CF&Co’s right to rely on
the representations and warranties made by the Company in this Agreement) and
the Company will furnish to CF&Co at the time of filing thereof a copy of
any document that upon filing is deemed to be incorporated by reference into
the
Registration Statement or Prospectus, except for those documents available
via
▇▇▇▇▇; and (iv) the Company will cause each amendment or supplement to the
Prospectus, other than documents incorporated by reference, to be filed with
the
Commission as required pursuant to the applicable paragraph of Rule 424(b)
of
the Securities Act (without reliance on Rule 424(b)(8) of the Securities
Act).
(b)
Notice
of Commission Stop Orders.
The
Company will advise CF&Co, promptly after it receives notice or obtains
knowledge thereof, of the issuance or threatened issuance by the Commission
of
any stop order suspending the effectiveness of the Registration Statement or
any
other order preventing or suspending the use of the Prospectus, of the
suspension of the qualification of the Placement Shares for offering or sale
in
any jurisdiction, or of the initiation or threatening of any proceeding for
any
such purpose or any examination pursuant to Section 8(e) of the Securities
Act,
or if the Company becomes the subject of a proceeding under Section 8A of the
Securities Act in connection with the offering of the Shares; and it will
promptly use its commercially reasonable efforts to prevent the issuance of
any
stop or other order or to obtain its withdrawal if such a stop or other order
should be issued.
(c) Delivery
of Prospectus; Subsequent Changes.
During
any period in which a Prospectus relating to the Placement Shares is required
to
be delivered by CF&Co under the Securities Act with respect to a pending
sale of the Placement Shares, (including in circumstances where such requirement
may be satisfied pursuant to Rule 172 under the Securities Act), the Company
will comply with all requirements imposed upon it by the Securities Act, as
from
time to time in force, and to file on or before their respective due dates
all
reports and any definitive proxy or information statements required to be filed
by the Company with the Commission pursuant to Sections 13(a), 13(c), 14, 15(d)
or any other provision of or under the Exchange Act. If during such period
any
event occurs as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
then existing, not misleading, or if during such period it is necessary to
amend
or supplement the Registration Statement or Prospectus to comply with the
Securities Act, the Company will promptly notify CF&Co to suspend the
offering of Placement Shares during such period and the Company will promptly
amend or supplement the Registration Statement or Prospectus (at the expense
of
the Company) so as to correct such statement or omission or effect such
compliance.
(d)
Listing
of Placement Shares.
During
any period in which the Prospectus relating to the Placement Shares is required
to be delivered by CF&Co under the Securities Act with respect to a pending
sale of the Placement Shares (including in circumstances where such requirement
may be satisfied pursuant to Rule 172 under the Securities Act), the Company
will use its commercially reasonable efforts to cause the Placement Shares
to be
listed on the Exchange and to qualify the Placement Shares for sale under the
securities laws of such jurisdictions as CF&Co reasonably designates and to
continue such qualifications in effect so long as required for the distribution
of the Placement Shares; provided,
however,
that the
Company shall not be required in connection therewith to qualify as a foreign
entity or dealer in securities or file a general consent to service of process
in any jurisdiction.
(e)
Filings
with the Exchange.
The
Company will timely file with the Exchange all documents and notices required
by
the Exchange of companies that have or will issue securities that are traded
on
the Exchange.
(f)
Delivery
of Registration Statement and Prospectus.
The
Company will furnish to CF&Co and its counsel (at the expense of the
Company) copies of the Registration Statement, the Prospectus (including all
documents incorporated by reference therein) and all amendments and supplements
to the Registration Statement or Prospectus that are filed with the Commission
during any period in which a Prospectus relating to the Placement Shares is
required to be delivered under the Securities Act (including all documents
filed
with the Commission during such period that are deemed to be incorporated by
reference therein), in each case as soon as reasonably practicable and in such
quantities as CF&Co may from time to time reasonably request and, at
CF&Co’s request, will also furnish copies of the Prospectus to each exchange
or market on which sales of the Placement Shares may be made. The copies of
the
Registration Statement and the Prospectus and any supplements or amendments
thereto furnished to CF&Co will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except
to the extent permitted by Regulation S-T.
(g) Earnings
Statement.
The
Company will make generally available to its security holders as soon as
practicable, but in any event not later than 15 months after the end of the
Company’s current fiscal quarter, an earnings statement covering a 12-month
period that satisfies the provisions of Section 11(a) and Rule 158 of the
Securities Act.
(h)
Expenses.
The
Company, whether or not the transactions contemplated hereunder are consummated
or this Agreement is terminated, in accordance with the provisions of Section
11
hereunder, will pay all expenses incident to the performance of its obligations
hereunder, including, but not limited to, expenses relating to (i) the
preparation, printing and filing of the Registration Statement and each
amendment and supplement thereto, of each Prospectus and of each amendment
and
supplement thereto, (ii) the preparation, issuance and delivery of the Placement
Shares, (iii) the qualification of the Placement Shares under securities laws
in
accordance with the provisions of Section
7(d)
of this
Agreement, including filing fees, (iv) the printing and delivery to CF&Co of
copies of the Prospectus and any amendments or supplements thereto, and of
this
Agreement, (v) the fees and expenses incurred in connection with the listing
or
qualification of the Placement Shares for trading on the Exchange, and (vi)
filing fees and expenses, if any, of the Commission and the NASD Corporate
Financing Department.
(i) Use
of
Proceeds.
The
Company will apply the net proceeds from the sale of the Shares to be sold
by it
hereunder in accordance in all material respects with the statements under
the
caption “Use of Proceeds” in the Prospectus. The Company will effect the
issuance to the Company by the Operating Partnership of a number of Common
Units
equal to the number of Shares sold pursuant to this Agreement upon the Company's
contribution to the Operating Partnership of the proceeds from the sale of
the
Shares.
(j) Notice
of Other Sales.
During
the pendency of any Placement Notice given hereunder, the Company shall provide
CF&Co notice as promptly as reasonably possible before it offers to sell,
contracts to sell, sells, grants any option to sell or otherwise disposes of
any
Shares (other than Placement Shares offered pursuant to the provisions of this
Agreement) or securities convertible into or exchangeable for Shares, warrants
or any rights to purchase or acquire Shares; provided,
that
such notice shall not be required in connection with the (i) issuance, grant
or
sale of the Company’s common shares, options to purchase the Company’s common
shares or the Company’s common shares issuable upon the exercise of options or
other equity awards pursuant to the any stock option, stock bonus or other
stock
plan or arrangement described in the Prospectus, (ii) the issuance of securities
in connection with an acquisition, merger, joint venture or sale or purchase
of
assets described in the Prospectus, (iii) the issuance or sale of the Company’s
common shares pursuant to any dividend reinvestment plan that the Company may
adopt from time to time provided the implementation of such is disclosed to
CF&Co in advance, (iv) any of the Company’s common shares issuable upon the
redemption of outstanding Common Units in accordance with the Operating
Partnership Agreement and (v) the issuance of Common Units by the Operating
Partnership in exchange for properties.
(k)
Change
of Circumstances.
The
Company will, at any time during a fiscal quarter in which the Company intends
to tender a Placement Notice or sell Placement Shares, advise CF&Co promptly
after it shall have received notice or obtained knowledge thereof, of any
information or fact that would alter or affect in any material respect any
opinion, certificate, letter or other document provided to CF&Co pursuant to
this Agreement.
(l)
Due
Diligence Cooperation.
The
Company and the Operating Partnership will cooperate with any reasonable due
diligence review conducted by CF&Co or its agents in connection with the
transactions contemplated hereby, including, without limitation, providing
information and making available documents and senior officers, during regular
business hours and at the Company’s principal offices, as CF&Co may
reasonably request.
(m) Required
Filings Relating to Placement of Placement Shares.
The
Company agrees that on such dates as the Securities Act shall require, the
Company will (i) file a prospectus supplement with the Commission under the
applicable paragraph of Rule 424(b) under the Securities Act, which prospectus
supplement will set forth, within the relevant period, the amount of Placement
Shares sold through CF&Co, the Net Proceeds to the Company and the
compensation payable by the Company to CF&Co with respect to such Placement
Shares, and (ii) deliver such number of copies of each such prospectus
supplement to each exchange or market on which such sales were effected as
may
be required by the rules or regulations of such exchange or market.
(n)
Representation
Dates; Certificate.
On or
prior to the date that the first Shares are sold pursuant to the terms of this
Agreement and each time the Company (i) files the Prospectus relating to the
Placement Shares or amends or supplements the Registration Statement or the
Prospectus relating to the Placement Shares (other than a prospectus supplement
filed in accordance with Section
7(m)
of this
Agreement) by means of a post-effective amendment, sticker, or supplement but
not by means of incorporation of documents by reference to the Registration
Statement or the Prospectus relating to the Placement Shares; (ii) files an
annual report on Form 10-K under the Exchange Act; (iii) files its quarterly
reports on Form 10-Q under the Exchange Act; or (iv) files a report on Form
8-K
containing amended financial information (other than an earnings release, to
“furnish” information pursuant to Items 2.02 or 7.01 of Form 8-K or to provide
disclosure pursuant to Item 8.01 of Form 8-K relating to the reclassifications
of certain properties as discontinued operations in accordance with Statement
of
Financial Accounting Standards No. 144) under the Exchange Act (each date of
filing of one or more of the documents referred to in clauses (i) through (iv)
shall be a "Representation
Date");
the
Company shall furnish CF&Co with a certificate, in the form attached hereto
as Exhibit
7(n)
within
ten (10) Trading Days of any Representation Date if requested by CF&Co.
The
requirement to provide a certificate under this Section
7(n)
shall be
waived for any Representation Date occurring at a time at which no Placement
Notice is pending, which waiver shall continue until the earlier to occur of
the
date the Company delivers a Placement Notice hereunder (which for such calendar
quarter shall be considered a Representation Date) and the next occurring
Representation Date. Notwithstanding the foregoing, if the Company subsequently
decides to sell Placement Shares following a Representation Date when the
Company relied on such waiver and did not provide CF&Co with a certificate
under this Section
7(n),
then
before the Company delivers the Placement Notice or CF&Co sells any
Placement Shares, the Company shall provide CF&Co with a certificate, in the
form attached hereto as Exhibit
7(n),
dated
the date of the Placement Notice.
(o) Legal
Opinion.
On
or
prior to the date that the first Shares are sold pursuant to the terms of this
Agreement,
the
Company shall cause to be furnished to CF&Co (i) a written opinion of Hunton
& ▇▇▇▇▇▇▇▇ LLP (“Company
Counsel”),
or
other counsel satisfactory to CF&Co, in form and substance satisfactory to
CF&Co and its counsel, dated the date that the opinion is required to be
delivered, substantially similar to the form attached hereto as Exhibit
7(o)-A
and (ii)
a letter of Company Counsel or other counsel satisfactory to CF&Co, in form
and substance satisfactory to CF&Co and its counsel, dated the date that the
letter is required to be delivered, substantially similar to the form attached
hereto as Exhibit
7(o)-B.
Within
ten (10) Trading Days of each Representation Date with respect to which the
Company is obligated to deliver a certificate in the form attached hereto as
Exhibit
7(n)
for
which no waiver is applicable, the Company shall cause to be furnished to
CF&Co (i) a written opinion of Company Counsel, or other counsel
satisfactory to CF&Co, in form and substance satisfactory to CF&Co and
its counsel, dated the date that the opinion is required to be delivered,
substantially similar to the form attached hereto as Exhibit
7(o)-C
and (ii)
a letter of Company Counsel or other counsel satisfactory to CF&Co, in form
and substance satisfactory to CF&Co and its counsel, dated the date that the
letter is required to be delivered, substantially similar to the form attached
hereto as Exhibit
7(o)-C
modified, as necessary, to relate to the Registration Statement and the
Prospectus as then amended or supplemented; provided,
however,
that in
lieu of such opinions for subsequent Representation Dates, counsel may furnish
CF&Co with a letter (a “Reliance
Letter”)
to the
effect that CF&Co may rely on a prior opinion delivered under this
Section
7(o)
to the
same extent as if it were dated the date of such letter (except that statements
in such prior opinion shall be deemed to relate to the Registration Statement
and the Prospectus as amended or supplemented at such Representation Date).
(p)
Comfort
Letter.
On or
prior to the date that the first Shares are sold pursuant to the terms of this
Agreement and within ten (10) Trading Days of each Representation Date with
respect to which the Company is obligated to deliver a certificate in the form
attached hereto as Exhibit
7(n)
for
which no waiver is applicable, the Company shall cause its independent
accountants (and any other independent accountants whose report is included
in
the Registration Statement or the Prospectus) to furnish CF&Co letters (the
"Comfort
Letters"),
dated
the date of the Comfort Letter is delivered, in form and substance satisfactory
to CF&Co, (i) confirming that they are an independent registered public
accounting firm within the meaning of the Securities Act, the Exchange Act
and
the PCAOB, (ii) stating, as of such date, the conclusions and findings of such
firm with respect to the financial information and other matters ordinarily
covered by accountants’ “comfort letters” to underwriters in connection with
registered public offerings (the first such letter, the “Initial
Comfort Letter”)
and
(iii) updating the Initial Comfort Letter with any information that would have
been included in the Initial Comfort Letter had it been given on such date
and
modified as necessary to relate to the Registration Statement and the
Prospectus, as amended and supplemented to the date of such letter.
(q)
Non-Delivery
of Materials.
Failure
to deliver any of the certificates, opinion, letters or comfort letters required
by and at the times set forth in paragraphs (m), (n), (o) or (p) above shall
be
deemed as the delivery by the Company of a Suspension Notice.
(r)
Market
Activities.
The
Company will not, directly or indirectly, (i) take any action designed to cause
or result in, or that constitutes or might reasonably be expected to constitute,
the stabilization or manipulation of the price of any security of the Company
to
facilitate the sale or resale of the Shares or (ii) sell, bid for, or purchase
the Shares to be issued and sold pursuant to this Agreement, or pay anyone
any
compensation for soliciting purchases of the Shares to be issued and sold
pursuant to this Agreement other than CF&Co; provided, however, that the
Company may bid for and purchase its common shares in accordance with Rule
10b-18 under the Exchange Act.
(s)
Insurance.
The
Company and its subsidiaries shall maintain, or caused to be maintained,
insurance in such amounts and covering such risks as is reasonable and customary
for companies engaged in similar businesses in similar industries.
(t)
Compliance
with Laws.
The
Company and each of its subsidiaries shall maintain, or cause to be maintained,
all material environmental permits, licenses and other authorizations required
by federal, state and local law in order to conduct their businesses as
described in the Prospectus, and the Company and each of its subsidiaries shall
conduct their businesses, or cause their businesses to be conducted, in
substantial compliance with such permits, licenses and authorizations and with
applicable environmental laws, except where the failure to maintain or be in
compliance with such permits, licenses and authorizations could not reasonably
be expected to have a Material Adverse Effect.
(u)
REIT
Treatment.
The
Company will take all commercially reasonable efforts to enable the Company
to
continue to meet the requirements for qualification and taxation as a REIT
under
the Code for subsequent tax years that include any portion of the term of this
Agreement.
(v)
Investment
Company Act.
The
Company will conduct its affairs in such a manner so as to reasonably ensure
that neither it nor its subsidiaries will be or become, at any time prior to
the
termination of this Agreement, an “investment company,” as such term is defined
in the Investment Company Act, assuming no change in the Commission’s current
interpretation as to entities that are not considered an investment
company.
(w) Securities
Act and Exchange Act.
The
Company will use its best efforts to comply with all requirements imposed upon
it by the Securities Act and the Exchange Act as from time to time in force,
so
far as necessary to permit the continuance of sales of, or dealings in, the
Placement Shares as contemplated by the provisions hereof and the
Prospectus.
(x)
No
Offer to Sell.
Other
than a free writing prospectus (as defined in Rule 405 under the Securities
Act)
approved in advance by the Company and CF&Co in its capacity as principal or
agent hereunder, neither CF&Co nor the Company (including its agents and
representatives, other than CF&Co in its capacity as such) will, directly or
indirectly, make, use, prepare, authorize, approve or refer to any free writing
prospectus relating to the Shares to be sold by CF&Co as principal or agent
hereunder.
(y)
▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act.
The
Company and its subsidiaries will use their best efforts to comply with all
effective applicable provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002.
8. Conditions
to CF&Co’s Obligations.
The
obligations of CF&Co hereunder with respect to a Placement will be subject
to the continuing accuracy and completeness of the representations and
warranties made by the Company and the Operating Partnership herein, to the
due
performance by the Company and the Operating Partnership of their respective
obligations hereunder, to the completion by CF&Co of a due diligence review
satisfactory to CF&Co in its reasonable judgment, and to the continuing
satisfaction (or waiver by CF&Co in its sole discretion) of the following
additional conditions:
(a)
Registration
Statement Effective.
The
Registration Statement shall be effective and shall be available for (i) all
sales of Placement Shares issued pursuant to all prior Placement Notices and
(ii) the sale of all Placement Shares contemplated to be issued by any Placement
Notice.
(b) No
Material Notices.
None of
the following events shall have occurred and be continuing: (i) receipt by
the
Company or any of its subsidiaries of any request for additional information
from the Commission or any other federal or state governmental authority during
the period of effectiveness of the Registration Statement, the response to
which
would require any post-effective amendments or supplements to the Registration
Statement or the Prospectus; (ii) the issuance by the Commission or any
other federal or state governmental authority of any stop order suspending
the
effectiveness of the Registration Statement or the initiation of any proceedings
for that purpose; (iii) receipt by the Company of any notification with respect
to the suspension of the qualification or exemption from qualification of any
of
the Placement Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; (iv) the occurrence of any
event
that makes any material statement made in the Registration Statement or the
Prospectus or any document incorporated or deemed to be incorporated therein
by
reference untrue in any material respect or that requires the making of any
changes in the Registration Statement, related Prospectus or such documents
so
that, in the case of the Registration Statement, it will not contain any
materially 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, that in the case of the Prospectus, it will not contain
any
materially 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,
in the light of the circumstances under which they were made, not misleading.
(c)
No
Misstatement or Material Omission.
CF&Co shall not have advised the Company that the Registration Statement or
Prospectus, or any amendment or supplement thereto, contains an untrue statement
of fact that in CF&Co’s reasonable opinion is material, or omits to state a
fact that in CF&Co’s opinion is material and is required to be stated
therein or is necessary to make the statements therein not
misleading.
(d)
Material
Changes.
Except
as disclosed in the Prospectus, there shall not have been any material adverse
change, on a consolidated basis, in the authorized equity or long-term debt
of
the Company or the Operating Partnership or any Material Adverse Effect, or
any
development that could reasonably be expected to cause a Material Adverse
Effect, or any downgrading in or withdrawal of the rating assigned to any of
the
Company’s or the Operating Partnership’s securities (other than asset backed
securities) by any rating organization or a public announcement by any rating
organization that it has under surveillance or review its rating of any of
the
Company’s or the Operating Partnership’s securities (other than asset backed
securities), the effect of which, in the case of any such action by a rating
organization described above, in the reasonable judgment of CF&Co (without
relieving the Company or the Operating Partnership of any obligation or
liability it may otherwise have), is so material as to make it impracticable
or
inadvisable to proceed with the offering of the Placement Shares on the terms
and in the manner contemplated in the Prospectus.
(e) Legal
Opinion and Letter.
CF&Co shall have received the opinions and letter of Company Counsel
required to be delivered pursuant Section
7(o)
on or
before the date on which such delivery of such opinion and letter is required
pursuant to Section
7(o).
(f)
Comfort
Letter.
CF&Co shall have received the Comfort Letter required to be delivered
pursuant Section
7(p)
on or
before the date on which such delivery of such opinion is required pursuant
to
Section
7(p).
(g)
Representation
Certificate.
CF&Co shall have received the certificate required to be delivered pursuant
to Section 7(n)
on or
before the date on which delivery of such certificate is required pursuant
to
Section
7(n).
(h)
No
Suspension.
Trading
in the Shares shall not have been suspended on the Exchange.
(i)
Other
Materials.
On each
date on which the Company is required to deliver a certificate pursuant to
Section
7(n),
the
Company and the Operating Partnership shall have furnished to CF&Co such
appropriate further information, certificates and documents as CF&Co may
have reasonably requested. All such opinions, certificates, letters and other
documents shall have been in compliance with the provisions hereof. The Company
and the Operating Partnership shall have furnished CF&Co with such conformed
copies of such opinions, certificates, letters and other documents as CF&Co
shall have reasonably requested.
(j)
Securities
Act Filings Made.
All
filings with the Commission required by Rule 424 under the Securities Act to
have been filed prior to the issuance of any Placement Notice hereunder shall
have been made within the applicable time period prescribed for such filing
by
Rule 424.
(k)
Approval
for Listing.
The
Placement Shares shall either have been (i) approved for listing on the
Exchange, subject only to notice of issuance, or (ii) the Company shall have
filed an application for listing of the Placement Shares on the Exchange at,
or
prior to, the issuance of any Placement Notice.
(l)
No
Termination Event.
There
shall not have occurred any event that would permit CF&Co to terminate this
Agreement pursuant to Section
11(a).
9. Indemnification
and Contribution.
(a) Company
and Operating Partnership Indemnification.
The
Company and the Operating Partnership, jointly and severally, agree to indemnify
and hold harmless CF&Co, the directors, officers, partners, employees and
agents of CF&Co and each person, if any, who (i) controls CF&Co within
the meaning of Section 15 of the
Securities Act
or
Section 20 of the Exchange Act, or (ii) is controlled by or is under common
control with CF&Co (a “CF&Co
Affiliate”)
from
and against any and all losses, claims, liabilities, expenses and damages
(including, but not limited to, any and all reasonable investigative, legal
and
other expenses incurred in connection with, and any and all amounts paid in
settlement (in accordance with Section
9(c))
of, any
action, suit or proceeding between any of the indemnified parties and any
indemnifying parties or between any indemnified party and any third party,
or
otherwise, or any claim asserted), as and when incurred, to which CF&Co, or
any such person, may become subject under the
Securities
Act, the Exchange Act or other federal or state statutory law or regulation,
at
common law or otherwise, insofar as such losses, claims, liabilities, expenses
or damages arise out of or are based, directly or indirectly, on (x) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or the Prospectus or any amendment or supplement to
the
Registration Statement or the Prospectus or in any free writing prospectus
or in
any application or other document executed by or on behalf of the Company or
the
Operating Partnership or based on written information furnished by or on behalf
of the Company or the Operating Partnership filed in any jurisdiction in order
to qualify the Shares under the securities laws thereof or filed with the
Commission, (y) the omission or alleged omission to state in any such document
a
material fact required to be stated in it or necessary to make the statements
in
it not misleading or (z) any breach by any of the indemnifying parties of any
of
their respective representations, warranties and agreements contained in this
Agreement; provided,
however,
that
this indemnity agreement shall not apply to the extent that such loss, claim,
liability, expense or damage arises from the sale of the Placement Shares
pursuant to this Agreement and is caused directly or indirectly by an untrue
statement or omission made in reliance upon and in conformity with written
information relating to CF&Co and furnished to the Company by CF&Co
expressly for inclusion in any document as described in clause (x) of this
Section
9(a)
(that
information being limited to the information described in Schedule
4
hereto).
This indemnity agreement will be in addition to any liability that the Company
or the Operating Partnership might otherwise have.
(b)
CF&Co
Indemnification.
CF&Co agrees to indemnify and hold harmless the Company, its directors, each
officer of the Company that signed the Registration Statement, the Operating
Partnership and each person, if any, who (i) controls the Company or the
Operating Partnership within the meaning of Section 15 of the
Securities Act
or
Section 20 of the Exchange Act or (ii) is controlled by or is under common
control with the Company or the Operating Partnership (a “Company
Affiliate”)
against any and all loss, liability, claim, damage and expense described in
the
indemnity contained in Section
9(a),
as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendments thereto) or the Prospectus (or any amendment or supplement thereto)
in reliance upon and in conformity with written information relating to
CF&Co and furnished to the Company by CF&Co expressly for inclusion in
any document as described in clause (x) Section
9(a)
(that
information being limited to the information described in Schedule
4
hereto).
(c)
Procedure.
Any
party that proposes to assert the right to be indemnified under this
Section
9 will,
promptly after receipt of notice of commencement of any action against such
party in respect of which a claim is to be made against an indemnifying party
or
parties under this Section
9,
notify
each such indemnifying party of the commencement of such action, enclosing
a
copy of all papers served, but the omission so to notify such indemnifying
party
will not relieve the indemnifying party from (i) any liability that it might
have to any indemnified party otherwise than under this Section
9
and (ii)
any liability that it may have to any indemnified party under the foregoing
provision of this Section
9
unless,
and only to the extent that, such omission results in the forfeiture of
substantive rights or defenses by the indemnifying party. If any such action
is
brought against any indemnified party and it notifies the indemnifying party
of
its commencement, the indemnifying party will be entitled to participate in
and,
to the extent that it elects by delivering written notice to the indemnified
party promptly after receiving notice of the commencement of the action from
the
indemnified party, jointly with any other indemnifying party similarly notified,
to assume the defense of the action, with counsel reasonably satisfactory to
the
indemnified party, and after notice from the indemnifying party to the
indemnified party of its election to assume the defense, the indemnifying party
will not be liable to the indemnified party for any legal or other expenses
except as provided below and except for the reasonable costs of investigation
subsequently incurred by the indemnified party in connection with the defense.
The indemnified party will have the right to employ its own counsel in any
such
action, but the fees, expenses and other charges of such counsel will be at
the
expense of such indemnified party unless (i) the employment of counsel by the
indemnified party has been authorized in writing by the indemnifying party,
(ii)
the indemnified party has reasonably concluded (based on advice of counsel)
that
there may be legal defenses available to it or other indemnified parties that
are different from or in addition to those available to the indemnifying party,
(iii) a conflict or potential conflict exists (based on advice of counsel to
the
indemnified party) between the indemnified party and the indemnifying party
(in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (iv) the indemnifying
party has not in fact employed counsel to assume the defense of such action
within a reasonable time after receiving notice of the commencement of the
action, in each of which cases the reasonable fees, disbursements and other
charges of counsel will be at the expense of the indemnifying party or parties.
It is understood that the indemnifying party or parties shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable
for the reasonable fees, disbursements and other charges of more than one
separate firm admitted to practice in such jurisdiction at any one time for
all
such indemnified party or parties. All such fees, disbursements and other
charges will be reimbursed by the indemnifying party promptly as they are
incurred. An indemnifying party will not, in any event, be liable for any
settlement of any action or claim effected without its written consent. No
indemnifying party shall, without the prior written consent of each indemnified
party, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding relating to the matters
contemplated by this Section
9
(whether
or not any indemnified party is a party thereto), unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising or that may arise out of such claim, action
or
proceeding.
(d) Contribution.
In
order to provide for just and equitable contribution in circumstances in which
the indemnification provided for in the foregoing paragraphs of this
Section
9
is
applicable in accordance with its terms but for any reason is held to be
unavailable from the Company, the Operating Partnership or CF&Co, the
Company and CF&Co will contribute to the total losses, claims, liabilities,
expenses and damages (including any investigative, legal and other expenses
reasonably incurred in connection with, and any amount paid in settlement of,
any action, suit or proceeding or any claim asserted, but after deducting any
contribution received by the Company or the Operating Partnership from persons
other than CF&Co, such as persons who control the Company or the Operating
Partnership within the meaning of the
Securities Act,
officers of the Company who signed the Registration Statement and directors
of
the Company, who also may be liable for contribution) to which the Company,
the
Operating Partnership and CF&Co may be subject in such proportion as shall
be appropriate to reflect the relative benefits received by the Company and
the
Operating Partnership, on the one hand, and CF&Co, on the other. The
relative benefits received by the Company and the Operating Partnership on
the
one hand and CF&Co on the other hand shall be deemed to be in the same
proportion as the total net proceeds from the sale of the Placement Shares
(before deducting expenses) received by the Company bear to the total
compensation received by CF&Co from the sale of Placement Shares on behalf
of the Company. If, but only if, the allocation provided by the foregoing
sentence is not permitted by applicable law, the allocation of contribution
shall be made in such proportion as is appropriate to reflect not only the
relative benefits referred to in the foregoing sentence but also the relative
fault of the Company and the Operating Partnership, on the one hand, and
CF&Co, on the other, with respect to the statements or omission that
resulted in such loss, claim, liability, expense or damage, or action in respect
thereof, as well as any other relevant equitable considerations with respect
to
such offering. Such relative fault shall be determined by reference to, among
other things, whether the 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 the Operating Partnership, on the one hand, or
CF&Co, on the other, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such statement
or
omission. The Company and the Operating Partnership and CF&Co agree that it
would not be just and equitable if contributions pursuant to this Section
9(d)
were to
be determined by pro rata allocation or by any other method of allocation that
does not take into account the equitable considerations referred to herein.
The
amount paid or payable by an indemnified party as a result of the loss, claim,
liability, expense, or damage, or action in respect thereof, referred to above
in this Section
9(d)
shall be
deemed to include, for the purpose of this Section
9(d),
any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim to the
extent consistent with Section
9(c)
hereof.
Notwithstanding the foregoing provisions of this Section
9(d),
CF&Co shall not be required to contribute any amount in excess of the
commissions received by it under this Agreement and no person found guilty
of
fraudulent misrepresentation (within the meaning of Section 11(f) of
the
Securities Act)
will be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section
9(d),
any
person who controls a party to this Agreement within the meaning of the
Securities Act,
and any
officers, directors, partners, employees or agents of CF&Co, will have the
same rights to contribution as that party, and each officer of the Company
who
signed the Registration Statement will have the same rights to contribution
as
the Company, subject in each case to the provisions hereof. Any party entitled
to contribution, promptly after receipt of notice of commencement of any action
against such party in respect of which a claim for contribution may be made
under this Section
9(d),
will
notify any such party or parties from whom contribution may be sought, but
the
omission to so notify will not relieve that party or parties from whom
contribution may be sought from any other obligation it or they may have under
this Section
9(d)
except
to the extent that the failure to so notify such other party materially
prejudiced the substantive rights or defenses of the party from whom
contribution is sought. Except for a settlement entered into pursuant to the
last sentence of Section
9(c)
hereof,
no party will be liable for contribution with respect to any action or claim
settled without its written consent if such consent is required pursuant to
Section
9(c)
hereof.
10.
Representations
and Agreements to Survive Delivery.
The
indemnity and contribution agreements contained in Section
9
of this
Agreement and all representations and warranties of the Company and the
Operating Partnership herein or in certificates delivered pursuant hereto shall
survive, as of their respective dates, regardless of (i) any investigation
made
by or on behalf of CF&Co, any controlling persons, or the Company or the
Operating Partnership (or any of their respective officers, directors or
controlling persons), (ii) delivery and acceptance of the Placement Shares
and
payment therefor or (iii) any termination of this Agreement.
11.
Termination.
(a) CF&Co
shall have the right by giving notice as hereinafter specified at any time
to
terminate this Agreement if (i) any Material Adverse Effect, or any development
that could reasonably be expected to cause a Material Adverse Effect has
occurred, that, in the reasonable judgment of CF&Co, may materially impair
the ability of CF&Co to sell the Placement Shares hereunder; (ii) the
Company or the Operating Partnership shall have failed, refused or been unable
to perform any agreement on its part to be performed hereunder; other than
any
failure of the Company to deliver (or cause another person to deliver) any
certification, opinion, or letter required under Sections 7(n),
7(o),
or
7(p),
or
(iii) any other condition of CF&Co’s obligations hereunder is not
fulfilled; or (iv), any suspension or limitation of trading in the Placement
Shares or in securities generally on the Exchange shall have occurred. Any
such
termination shall be without liability of any party to any other party except
that the provisions of Section
7(h)
(Expenses), Section
9
(Indemnification), Section
10
(Survival of Representations), Section
16
(Applicable Law; Consent to Jurisdiction) and Section
17
(Waiver
of Jury Trial) hereof shall remain in full force and effect notwithstanding
such
termination.
(b)
The
Company and the Operating Partnership shall have the right, by giving ten (10)
days notice as hereinafter specified to terminate this Agreement in their sole
discretion at
any
time after the date of this Agreement.
Any
such termination shall be without liability of any party to any other party
except that the provisions of Section
7(h),
Section
9,
Section
10,
Section
16
and
Section
17
hereof
shall remain in full force and effect notwithstanding such
termination.
(c)
CF&Co
shall have the right, by giving ten (10) days notice as hereinafter specified
to
terminate this Agreement in its sole discretion
at any
time after the date of this Agreement.
Any
such termination shall be without liability of any party to any other party
except that the provisions of Section
7(h),
Section
9,
Section
10,
Section
16
and
Section
17
hereof
shall remain in full force and effect notwithstanding such
termination.
(d) Unless
earlier terminated pursuant to this Section
11,
this
Agreement shall automatically terminate upon the issuance and sale of all of
the
Placement Shares through CF&Co on the terms and subject to the conditions
set forth herein; provided
that the
provisions of Section
7(h),
Section
9,
Section
10,
Section
16
and
Section
17
hereof
shall remain in full force and effect notwithstanding such
termination.
(e) This
Agreement shall remain in full force and effect unless terminated pursuant
to
Sections
11(a),
(b),
(c),
or
(d)
above or
otherwise by mutual agreement of the parties; provided,
however, that
any
such termination by mutual agreement shall in all cases be deemed to provide
that Section
7(h),
Section
9,
Section
10,
Section
16
and
Section
17
shall
remain in full force and effect.
(f)
Any
termination of this Agreement shall be effective on the date specified in such
notice of termination; provided,
however,
that
such termination shall not be effective until the close of business on the
date
of receipt of such notice by CF&Co or the Company, as the case may be. If
such termination shall occur prior to the Settlement Date for any sale of
Placement Shares, such Placement Shares shall settle in accordance with the
provisions of this Agreement.
12.
Notices.
All
notices or other communications required
or permitted to be given by any party to any other party pursuant to the terms
of this Agreement shall
be
in writing, unless otherwise specified in this Agreement, and if sent to
CF&Co, shall be delivered to CF&Co at Cantor ▇▇▇▇▇▇▇▇▇▇ & Co., ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, fax no. (▇▇▇) ▇▇▇-▇▇▇▇, Attention:
ITD-Investment Banking, with copies to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, General Counsel, at
the
same address, and ▇▇▇▇▇▇▇▇ Chance US LLP, ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇, fax no. (▇▇▇) ▇▇▇-▇▇▇▇, Attention: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇; or if sent to the
Company or the Operating Partnership, shall be delivered to Hersha Hospitality
Trust, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ fax no. (▇▇▇) ▇▇▇-▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ with a copy to Hunton & ▇▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, fax no. (▇▇▇) ▇▇▇-▇▇▇▇, Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇. Each
party to this Agreement may change such address for notices by sending to the
parties to this Agreement written notice of a new address for such
purpose.
Each
such notice or other communication shall be deemed given (i) when delivered
personally or by verifiable facsimile transmission (with an original to follow)
on or before 4:30 p.m., New York City time, on a Business Day or, if such day
is
not a Business Day, on the next succeeding Business Day, (ii) on the next
Business Day after timely delivery to a nationally-recognized overnight courier
and (iii) on the Business Day
actually received if deposited in the U.S. mail (certified or registered mail,
return receipt requested, postage prepaid). For purposes of this Agreement,
“Business
Day”
shall
mean any day on which the Exchange and commercial banks in the City of New
York
are open for business.
13. Successors
and Assigns.
This
Agreement shall inure to the benefit of and be binding upon the Company, the
Operating Partnership and CF&Co and their respective successors and the
affiliates, controlling persons, officers and directors referred to in
Section
9
hereof.
References to any of the parties contained in this Agreement shall be deemed
to
include the successors and permitted assigns of such party. Nothing
in this Agreement, express or implied, is intended to confer upon any party
other than the parties hereto or their respective successors and permitted
assigns any rights, remedies, obligations or liabilities under or by reason
of
this Agreement, except as expressly provided in this Agreement. Neither party
may assign its rights or obligations under this Agreement without the prior
written consent of the other party; provided,
however,
that
CF&Co may assign its rights and obligations hereunder to an affiliate of
CF&Co without obtaining the Company’s consent.
14.
Adjustments
for Stock Splits.
The
parties acknowledge and agree that all stock-related numbers contained in this
Agreement shall be adjusted to take into account any stock split, stock dividend
or similar event effected with respect to the Shares.
15.
Entire
Agreement; Amendment; Severability.
This
Agreement (including all schedules and exhibits attached hereto and Placement
Notices issued pursuant hereto) constitutes the entire agreement and supersedes
all other prior and contemporaneous agreements and undertakings, both written
and oral, among the parties hereto with regard to the subject matter
hereof.
Neither
this Agreement nor any term hereof may be amended except pursuant to a written
instrument executed by the Company and CF&Co. In the event that any one or
more of the provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable as written by
a
court of competent jurisdiction,
then
such
provision shall be given full force and effect to the fullest possible extent
that it is
valid,
legal and enforceable,
and the
remainder of the terms and provisions herein shall be construed as if such
invalid,
illegal or unenforceable term
or
provision was not contained herein, but only to the extent that giving effect
to
such provision and the remainder of the terms and provisions hereof shall be
in
accordance with the intent of the parties as reflected in this
Agreement.
16.
Applicable
Law; Consent to Jurisdiction.
This
Agreement shall be governed by, and construed in accordance with, the internal
laws of the State of New York without regard to the principles of conflicts
of
laws. Each
party hereby irrevocably submits to the non-exclusive jurisdiction of the state
and federal courts sitting in the City of New York, borough of Manhattan, for
the adjudication of any dispute hereunder or in connection with any transaction
contemplated hereby, and hereby irrevocably waives, and agrees not to assert
in
any suit, action or proceeding, any claim that it is not personally subject
to
the jurisdiction of any such court, that such suit, action or proceeding is
brought in an inconvenient forum or that the venue of such suit, action or
proceeding is improper. Each party hereby irrevocably waives personal service
of
process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof (certified or registered mail, return
receipt requested) to such party at the address in effect for notices to it
under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. Nothing contained herein
shall
be deemed to limit in any way any right to serve process in any manner permitted
by law.
17.
Waiver
of Jury Trial.
The
Company, the Operating Partnership and CF&Co each hereby irrevocably waives
any right it may have to a trial by jury in respect of any claim based upon
or
arising out of this Agreement or any transaction contemplated
hereby.
18.
Absence
of Fiduciary Relationship. The
Company and the Operating Partnership jointly and severally acknowledge and
agree that:
(a)
CF&Co
has been retained solely to act as agent in connection with the sale of the
Shares and that no fiduciary, advisory or agency relationship between the
Company and CF&Co has been created in respect of any of the transactions
contemplated by this Agreement, irrespective of whether CF&Co has advised or
is advising the Company on other matters;
(b) each
of
the Company and the Operating Partnership is capable of evaluating and
understanding and understand and accept the terms, risks and conditions of
the
transactions contemplated by this Agreement;
(c)
each
of
the Company and the Operating Partnership has been advised that CF&Co and
its affiliates are engaged in a broad range of transactions which may involve
interests that differ from those of the Company or the Operating Partnership
and
that CF&Co has no obligation to disclose such interests and transactions to
the Company or the Operating Partnership by virtue of any fiduciary, advisory
or
agency relationship; and
(d)
each
of
the Company and the Operating Partnership waives, to the fullest extent
permitted by law, any claims it may have against CF&Co, for breach of
fiduciary duty or alleged breach of fiduciary duty and agrees that CF&Co
shall have no liability (whether direct or indirect) to the Company or the
Operating Partnership in respect of such a fiduciary claim or to any person
asserting a fiduciary duty claim on behalf of or in right of the Company or
the
Operating Partnership, including stockholders, partners, employees or creditors
of the Company or the Operating Partnership.
19.
Counterparts.
This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original, but all of which together shall constitute one and the
same
instrument. Delivery of an executed Agreement by one party to the other may
be
made by facsimile transmission.
20.
Definitions.
As used
in this Agreement, the following terms have the respective meanings set forth
below:
(a)
“Applicable
Time”
means
the time of each sale of any Shares or any securities pursuant to this
Agreement.
(b)
“GAAP”
means
United States generally accepted accounting principles.
(c)
“Organizational
Documents”
means
(a) in the case of a corporation, its charter and by-laws; (b) in the
case of a limited or general partnership, its partnership certificate,
certificate of formation or similar organizational document and its partnership
agreement; (c) in the case of a limited liability company, its articles of
organization, certificate of formation or similar organizational documents
and
its operating agreement, limited liability company agreement, membership
agreement or other similar agreement; (d) in the case of a trust, its
certificate of trust, certificate of formation or similar organizational
document and its trust agreement or other similar agreement; and (e) in the
case of any other entity, the organizational and governing documents of such
entity.
[Remainder
of Page Intentionally Blank]
If
the
foregoing correctly sets forth the understanding among the Company, the
Operating Partnership and CF&Co, please so indicate in the space provided
below for that purpose, whereupon this letter shall constitute a binding
agreement between the Company, the Operating Partnership and CF&Co.
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Very
truly yours,
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By:
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Name:
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Title:
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HERSHA
HOSPITALITY LIMITED PARTNERSHIP
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By:
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Hersha Hospitality Trust, its general partner | |
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Name:
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Title:
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ACCEPTED
as of the date first-above written:
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CANTOR
▇▇▇▇▇▇▇▇▇▇ & CO.
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By:
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Name:
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Title:
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