Exhibit 1.2
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT is made as of the 2nd day of April 1998, by and
among CarrAmerica Realty Corporation (the "Company") and Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx").
IN CONSIDERATION of the mutual covenants contained in this Purchase
Agreement, the Company and Xxxxxxx Xxxxx hereby agree as follows:
SECTION l. Authorization of Sale of the Shares. Subject to the terms and
conditions of this Purchase Agreement, the Company has authorized the sale to
Xxxxxxx Xxxxx of 5,000,000 shares (the "Purchased Shares") of its common stock,
$.01 par value per share ("Common Shares"). In connection with the execution and
delivery of this Agreement, the Company and Xxxxxxx Xxxxx also are entering into
a Purchase Price Adjustment Agreement dated as of the date of this Agreement
(the "Adjustment Agreement") under which the Company may issue to Xxxxxxx Xxxxx
additional Common Shares (the "Additional Shares") and/or Xxxxxxx Xxxxx may
return Purchased Shares or Additional Shares to the Company in settlement of
certain obligations under the Adjustment Agreement. The Purchased Shares and the
Additional Shares are hereinafter collectively called the "Shares."
The Company and Xxxxxxx Xxxxx intend that all payments and deliveries
made under the Adjustment Agreement constitute adjustments to the purchase price
paid by Xxxxxxx Xxxxx for the Purchased Shares (or, as applicable, adjustments
to the number of Purchased Shares purchased) under this Agreement and agree, to
the extent relevant to their respective business and commercial activities and
in the absence of a definitive administrative determination or judicial ruling
to the contrary, to treat all such payments and deliveries in a manner
consistent therewith for United States federal income tax and financial
accounting purposes.
SECTION 2. Agreement to Sell and Purchase the Purchased Shares. Subject
to the terms and conditions of this Purchase Agreement, on the Closing Date (as
defined in Section 3 hereof), the Company will sell each of the Purchased Shares
to Xxxxxxx Xxxxx for a per share purchase price equal to 98.00% of the Closing
Price (the "Net Purchase Price"). The "Closing Price" shall equal the closing
price reported on the New York Stock Exchange for a Common Share on the date
hereof.
SECTION 3. Delivery of the Shares at the Closing.
3.1. Closing. The completion of the purchase and sale of the
Purchased Shares (the "Closing") shall occur as soon as practicable on or after
the date hereof on a business day to be agreed upon by the Company and Xxxxxxx
Xxxxx, but in no event later than five business days after the execution of this
Purchase Agreement (hereinafter, the "Closing Date").
3.2. Conditions. At the Closing, the Company shall deliver to
Xxxxxxx Xxxxx one or more stock certificates registered in the name of Xxxxxxx
Xxxxx representing the Purchased Shares.
The Company's obligation to complete the purchase and sale of the
Purchased Shares and deliver such stock certificate(s) to Xxxxxxx Xxxxx at the
Closing shall be subject to the following conditions, any one or more of which
may be waived by the Company: (i) receipt by the Company of Federal Funds (or
other mutually agreed upon form of payment) in the full amount of the Net
Purchase Price, (ii) the accuracy, in all material respects, as of the Closing
Date of the representations and warranties made by Xxxxxxx Xxxxx herein and the
fulfillment, in all material respects, of those undertakings of Xxxxxxx Xxxxx to
be fulfilled prior to the Closing, (iii) execution and delivery of the
Adjustment Agreement, (iv) receipt by the Company of a cross-receipt with
respect to the Purchased Shares executed by Xxxxxxx Xxxxx and (v) receipt by the
Company of a certificate of an officer or authorized representative of Xxxxxxx
Xxxxx to the effect that the representations and warranties of Xxxxxxx Xxxxx set
forth in Section 5 hereof are true and correct as of the Closing Date.
Xxxxxxx Xxxxx'x obligation to accept delivery of such stock
certificate(s) and to pay for the Purchased Shares evidenced thereby shall be
subject to the following conditions, any one or more of which may be waived by
Xxxxxxx Xxxxx: (i) the accuracy, in all material respects, as of the Closing
Date, of the representations and warranties made by the Company herein and the
fulfillment, in all material respects, of those undertakings of the Company to
be fulfilled prior to the Closing, (ii) receipt by Xxxxxxx Xxxxx of all
opinions, letters and certificates to be delivered by the Company pursuant to
this Purchase Agreement, (iii) execution and delivery of the Adjustment
Agreement, and (iv) receipt by Xxxxxxx Xxxxx of a cross-receipt with respect to
the purchase price for the Purchased Shares executed by the Company.
The Company has filed with the U.S. Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (No.
333-22353) for the registration of certain Common Shares, shares of preferred
stock, warrants for the purchase of Common Shares, debt securities and shares of
preferred stock represented by depositary shares under the Securities Act of
1933, as amended (the "Securities Act"), and the offering thereof from time to
time in accordance with Rule 415 of the rules and regulations of the Commission
under the Securities Act (the "1933 Act Regulations"), and the Company has filed
such amendment or amendments thereto as may have been required prior to the
execution of this Agreement. Such registration statement (as amended, if
applicable) has been declared effective by the Commission. Such registration
statement and the prospectus (including any prospectus supplement) constituting
a part thereof provided by the Company to Xxxxxxx Xxxxx for use in connection
with the offering and sale of the Purchased Shares to Xxxxxxx Xxxxx (including,
in each case, any information deemed to be a part thereof pursuant to Rule
430A(b) of the 1933 Act Regulations), as from time to time amended or
supplemented pursuant to the Securities Act or otherwise, are hereinafter
referred to as the "Registration Statement" and the "Prospectus," respectively,
except that if any revised prospectus shall be provided to Xxxxxxx Xxxxx by the
Company for use in connection with the offering and sale of the Shares that
differs from the prospectus on file at the Commission (whether or not such
revised prospectus is required to be filed by the Company pursuant to
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Rule 424(b) of the 1933 Act Regulations), the term "Prospectus" shall refer to
such revised prospectus from and after the time it is first provided to Xxxxxxx
Xxxxx for such use; and except further that a prospectus supplement shall be
deemed to have supplemented a prospectus only to the extent that it relates to,
and only with respect to, the offering and sale of the Shares. All references in
this Agreement to financial statements and schedules and other information that
are "contained," "included" or "stated" in the Registration Statement or the
Prospectus (and all other references of like import) shall be deemed to mean and
include all financial statements and schedules and other information that are or
are deemed to be incorporated by reference in the Registration Statement or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement or the Prospectus shall
be deemed to mean and include the filing of any document under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), that is or is deemed to
be incorporated by reference in the Registration Statement or the Prospectus, as
the case may be.
The term "Subsidiary" means a corporation or a partnership a majority of
the outstanding voting stock or partnership or membership interests, as the case
may be, of which is owned or controlled, directly or indirectly, by the Company,
Xxxx Realty, L.P., a Delaware limited partnership ("Xxxx X.X."), or CarrAmerica
Realty, L.P., a Delaware limited partnership ("CarrAmerica L.P." and, together
with Xxxx X.X., the "Partnerships"), as the case may be, or by one or more other
Subsidiaries of the Company or either Partnership.
SECTION 4. Representations, Warranties and Covenants of the Company. The
Company hereby represents and warrants to Xxxxxxx Xxxxx, and covenants with
Xxxxxxx Xxxxx, as follows:
4.1. Registration Statement and Prospectus. The Registration
Statement, at the time the Registration Statement became effective, complied,
and as of the date hereof complies, in all material respects with the
requirements of the Securities Act and the 1933 Act Regulations. The
Registration Statement, at the time the Registration Statement became effective,
did not, and as of the date hereof does not, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading. The Prospectus, as of
the date it was first provided to Xxxxxxx Xxxxx for use in connection with the
offering and sale of the Purchased Shares to Xxxxxxx Xxxxx did not, and as of
the date hereof does not, contain an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided, however, that the representations and warranties in this section shall
not apply to statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information furnished to
the Company in writing through Xxxxxxx Xxxxx expressly for use in the
Registration Statement or the Prospectus.
4.2. Documents Incorporated by Reference. The documents
incorporated or deemed to be incorporated by reference in the Prospectus
pursuant to Item 12 of Form S-3 under the Securities Act, at the time they were
filed with the Commission, complied in all material respects with the
requirements of the 1934 Act and the rules and regulations of the Commission
under the 1934 Act (the "1934 Act Regulations"), and, when read together
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with the other information in the Prospectus, at the time the Registration
Statement became effective and as of the date hereof, did not and do 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, in the light
of the circumstances under which they were made, not misleading.
4.3. Accountants. The accountants who certified the financial
statements and supporting schedules included in the Registration Statement and
Prospectus are independent public accountants as required by the Securities Act
and the 1933 Act Regulations.
4.4. Financial Statements. The financial statements (including the
notes thereto) included in the Registration Statement and the Prospectus present
fairly the financial position of the respective entity or entities presented
therein at the respective dates indicated and the results of their operations
for the respective periods specified; except as otherwise stated in the
Registration Statement and Prospectus, said financial statements have been
prepared in conformity with generally accepted accounting principles applied on
a consistent basis; and the supporting schedules included or incorporated by
reference in the Registration Statement and the Prospectus present fairly the
information required to be stated therein. The financial information and data
included in the Registration Statement and the Prospectus present fairly the
information included therein and have been prepared on a basis consistent with
that of the financial statements included or incorporated by reference in the
Registration Statement and the Prospectus and the books and records of the
respective entities presented therein. The pro forma financial information
included in the Registration Statement and the Prospectus has been prepared in
accordance with the applicable requirements of the Securities Act, the 1933 Act
Regulations and guidelines of the American Institute of Certified Public
Accountants with respect to pro forma financial information and includes all
adjustments necessary to present fairly in all material respects the pro forma
financial position of the Company at the respective dates indicated (if such
financial position is presented) and the results of operations for the
respective periods specified.
4.5. No Stop Order. No stop order suspending the effectiveness of
the Registration Statement or any part thereof has been issued and no proceeding
for that purpose has been instituted or, to the knowledge of the Company,
threatened by the Commission or by the state securities authority of any
jurisdiction. No order preventing or suspending the use of the Prospectus has
been issued and no proceeding for that purpose has been instituted or, to the
knowledge of the Company, threatened by the Commission or by the state
securities authority of any jurisdiction.
4.6. No Material Change. Since the respective dates as of which
information is given in the Registration Statement and the Prospectus, except as
otherwise stated therein, (A) there has been no material adverse change in the
condition, financial or otherwise, or in the earnings, assets, business affairs
or business prospects of the Company, the Partnerships, and the Subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of
business; (B) no material casualty loss or material condemnation or other
material adverse event with respect to any of the interests held directly or
indirectly in any of the real properties owned, directly or indirectly, by the
Company, either Partnership or any Subsidiary (the "Properties") or any entity
wholly or partially owned by the
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Company, either Partnership or any Subsidiary has occurred; (C) there have been
no acquisitions or transactions entered into by the Company, either Partnership
or any Subsidiary, other than those in the ordinary course of business, which
are material with respect to such entities or would result, upon consummation,
in any material inaccuracy in the representations contained in Section 4.4
above; (D) except for regular quarterly dividends on Common Shares, dividends on
outstanding shares of the Company's preferred stock in amounts per share that
are consistent with past practice, and distributions by either of the
Partnerships with respect to its partnership interests ("Units"), there has been
no dividend or distribution of any kind declared, paid or made by the Company on
any class of its capital stock or by either of the Partnerships with respect to
its Units; and (E) with the exception of transactions in connection with stock
and Unit options and in connection with dividend reinvestment plans, the
issuance of Common Shares upon the exchange of Units, the issuance of Units in
connection with the acquisition of real or personal property, the sale of the
Purchased Shares under this Agreement and the reservation of the Additional
Shares for issuance pursuant to the Adjustment Agreement, there has been no
change in the capital stock or in the partnership interests or membership
interests, as the case may be, of the Company, either of the Partnerships or any
Subsidiary, and no increase in the indebtedness of the Company, either of the
Partnerships, or any Subsidiary, that is material to the Company, the
Partnerships and the Subsidiaries, considered as one enterprise.
4.7. Organization of the Company. The Company has been duly
formed, and is validly existing and in good standing as a corporation under the
laws of Maryland with corporate power and authority to conduct the business in
which it is engaged or proposes to engage and to own, lease and operate its
properties as described in the Prospectus and to enter into and perform its
obligations under this Agreement.
4.8. Organization the Partnerships and Subsidiaries. Each of the
Partnerships and the Subsidiaries has been duly formed, and is validly existing
and in good standing as a corporation or partnership under the laws of its
jurisdiction of organization, with partnership or corporate power and authority
to conduct the business in which it is engaged or proposes to engage and to own,
lease and operate its properties as described in the Prospectus.
4.9. Qualification. Each of the Company, the Partnerships and the
Subsidiaries is duly qualified or registered as a foreign partnership or
corporation in good standing and authorized to do business in each jurisdiction
in which such qualification is required whether by reason of the ownership,
leasing or management of property or the conduct of business, except where the
failure to so qualify would not have a material adverse effect on the condition,
financial or otherwise, or the earnings, assets or business affairs of the
Company, the Partnerships and the Subsidiaries considered as one enterprise (a
"Material Adverse Effect").
4.10. Authorized Capital Stock. The capital stock of the Company
as of the date specified in the Prospectus is as set forth therein under
"Capitalization." All the issued and outstanding shares of capital stock of the
Company have been duly authorized and are validly issued, fully paid and
non-assessable and have been offered and sold in compliance with all applicable
laws (including, without limitation, federal, state or foreign securities laws).
Except for transactions described in the Prospectus and transactions in
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connection with stock and Unit options and in connection with dividend
reinvestment plans and exchanges of Units, there are no outstanding securities
convertible into or exchangeable for any capital stock of the Company and no
outstanding options, rights (preemptive or otherwise) or warrants to purchase or
to subscribe for such shares, Units or other securities of the Company, the
Partnerships or the Subsidiaries.
4.11. Issuance, Sale and Delivery of the Shares. The Shares have
been duly authorized by the Company for issuance and sale pursuant to this
Agreement and the Adjustment Agreement, and, when issued and delivered by the
Company in the manner and against payment of the consideration set forth herein
and therein, will be validly issued, fully paid and non-assessable. Upon payment
of the purchase price and delivery of the Shares in accordance with this
Agreement and the Adjustment Agreement, Xxxxxxx Xxxxx will receive good, valid
and marketable title to the Shares, free and clear of all security interests,
mortgages, pledges, liens, encumbrances, claims and equities. No approval of or
authorization by the stockholders or the Board of Directors of the Company will
be required for the issuance and/or sale of the Shares to be sold by the Company
as contemplated herein and in the Adjustment Agreement, except such as will have
been obtained on or before the Closing Date. The terms of the Purchased Shares
conform in all material respects to all statements and descriptions related
thereto contained in the Prospectus. The form of stock certificate to be used to
evidence the Purchased Shares will be in due and proper form and will comply
with all applicable legal requirements. The issuance of the Purchased Shares is
not subject to any preemptive or other similar rights, except as described in
the Prospectus.
4.12. Resale Registration Statement. The Company meets and will
continue to meet the requirements to use Form S-3 under the Securities Act and
the 1933 Act Regulations for the resale of the Shares by Xxxxxxx Xxxxx. The
Company has filed or will file all documents which it is required to file under
the Exchange Act and the rules and regulations promulgated thereunder (the "1934
Act Regulations") to be incorporated or deemed to be incorporated in the Resale
Registration Statement (as defined in Section 7 below) within the time periods
prescribed by the Exchange Act and the 1934 Act Regulations and all such
documents comply (or will comply) in all material respects with the requirements
of the Exchange Act and the 1934 Act Regulations, as applicable, and none of
such documents, when so filed, contained or will contain any untrue statement of
a material fact or omitted or will omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. Each Resale
Registration Statement, when filed, will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading.
4.13. Due Execution, Delivery and Performance by the Company. This
Agreement and the Adjustment Agreement have been duly and validly authorized,
executed and delivered by the Company and, assuming due authorization, execution
and delivery by Xxxxxxx Xxxxx, are valid and binding agreements of the Company,
enforceable in accordance with their terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' and contracting parties' rights
generally, except as enforceability may be subject to general principles of
equity (regardless of whether such enforceability is considered in a proceeding
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in equity or at law) and except that enforcement of the indemnification
agreements in Section 7.4 hereof may be limited by public policy.
4.14. No Defaults. None of the Company, the Partnerships or any
Subsidiary is in violation of its charter, by-laws, certificate of limited
partnership or partnership agreement, as the case may be, or in default in the
performance or observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which such entity is a party or by which such entity may be
bound, or to which any of its property or assets is subject, which violation or
default separately or in the aggregate would have a Material Adverse Effect.
4.15. No Liens, Conflicts or Breaches. The execution and delivery
of this Agreement and the Adjustment Agreement, the performance of the
obligations set forth herein and therein and the consummation of the
transactions contemplated hereby and thereby by the Company will not (A) result
in the creation of any lien, charge or encumbrance upon the Properties or (B)
conflict with or constitute a breach or violation by the Company of, or default
under, (1) any material contract, indenture, mortgage, loan agreement, note,
lease, joint venture or partnership agreement or other instrument or agreement
to which the Company, either of the Partnerships or any Subsidiary is a party,
or by which they, any of them, any of their respective properties or other
assets or any Property (including, without limitation, partnership and other
interests in partnerships or other entities which own direct or indirect
interests therein) is or may be bound or subject, (2) the charter, by-laws,
certificate of limited partnership, partnership agreement or other
organizational document, as the case may be, of the Company, the Partnerships or
any Subsidiary or (3) any applicable law, rule, order, administrative regulation
or administrative or court decree.
4.16. No Actions. There is no action, suit or proceeding before or
by any court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, threatened against or affecting the
Company, either of the Partnerships, any Subsidiary, any Property or any officer
or director of the foregoing that is required to be disclosed in the
Registration Statement (other than as disclosed therein), and that, if
determined adversely to the Company, the applicable Partnership, any Subsidiary,
any Property, or any such officer or director, would reasonably be expected to
result in any Material Adverse Effect, or which might materially and adversely
affect the consummation of this Agreement or the Adjustment Agreement or the
transactions contemplated herein and therein. There is no pending legal or
governmental proceeding to which the Company, either of the Partnerships or any
Subsidiary is a party or of which any of their respective properties or assets
or any Property (including, without limitation, partnership and other interests
in partnerships or other entities which own direct or indirect interests
therein) is the subject, including ordinary routine litigation incidental to the
business or operations of the foregoing, that is or would reasonably be expected
to be, material to the condition, financial or otherwise, or the earnings,
assets, business affairs or business prospects of the Company, the Partnerships
and the Subsidiaries, considered as one enterprise. There are no contracts or
documents of a character which are required to be filed as exhibits to the
Registration Statement by the Securities Act or by the 1933 Act Regulations
which have not been filed as exhibits to the Registration Statement.
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4.17. REIT Qualification. At all times beginning with its taxable
period ended December 31, 1993, the Company has been organized and operated in
conformity with the requirements for qualification as a real estate investment
trust under the Internal Revenue Code of 1986, as amended (the "Code"), and its
proposed method of operation will enable it to continue to meet the requirements
for taxation as a real estate investment trust under the Code.
4.18. Investment Company. None of the Company, the Partnerships or
any Subsidiary is required to be registered under the Investment Company Act of
1940, as amended (the "1940 Act").
4.19. Intellectual Property. The Company, the Partnerships and the
other Subsidiaries own or possess the trademarks, service marks and trade names
(collectively, "proprietary rights") that are material to the businesses now
operated or proposed to be operated by them and that are currently employed or
proposed to be employed by them in connection with such businesses, and none of
the Company, the Partnerships or any of the Subsidiaries has received any notice
or is otherwise aware of any infringement of or conflict with asserted rights of
others with respect to any such proprietary rights.
4.20. Government Authorizations. All authorizations, approvals or
consents of any court or government authority or agency or other entity or
person that are necessary in connection with the execution and delivery of this
Agreement and the Adjustment Agreement and the consummation of the transactions
contemplated herein and therein have been obtained, except such as may be
required under the Securities Act or the 1933 Act Regulations or state
securities laws with respect to the offering and sale of the Shares and in
connection with the filing of any Resale Registration Statement under Section 7
below.
4.21. Permits. Each of the Company, the Partnerships and the
Subsidiaries possesses such certificates, authorizations or permits issued by
the appropriate regulatory agencies or bodies necessary to conduct the business
now conducted by it, or proposed to be conducted by it, and none of the Company,
either of the Partnerships or any Subsidiary has received any notice of
proceedings relating to the revocation or modification of any such certificate,
authority or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would materially and adversely affect
the condition, financial or otherwise, or the earnings, assets, business affairs
or business prospects of the Company, the Partnerships and the Subsidiaries
considered as one enterprise.
4.22. Labor Disputes. No material labor dispute with the employees
of the Company, either of the Partnerships or any Subsidiary exists or, to the
knowledge of the Company or either of the Partnerships is imminent.
4.23. Environmental Protection. Except as disclosed in the
Prospectus, (A) to the knowledge of the Company, the Environment (as defined
below) at each Property is free of any Hazardous Substance (as defined below)
except for any Hazardous Substance that would not reasonably be expected to have
any Material Adverse Effect; (B) none of the Company, the Partnerships or any
Subsidiary and, to the knowledge of the Company, no prior owner of any Property
has caused or suffered to occur any Release (as defined below)
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of any Hazardous Substance into the Environment on, in, under or from any
Property in violation of any Environmental Law applicable to such Property in an
amount that would reasonably be expected to have a Material Adverse Effect and
no condition exists on, in or under any Property or, to the knowledge of the
Company, any property adjacent to any Property that could reasonably be expected
to result in the occurrence of material liabilities under, or any material
violations of, any Environmental Law (as defined below) applicable to such
Property, give rise to the imposition of any Lien (as defined below) under any
Environmental Law, or cause or constitute an environmental hazard to any
property, person or entity; (C) none of the Company, the Partnerships or any
Subsidiary is engaged in or intends to engage in any manufacturing or any other
similar operations at any Property and, to the knowledge of the Company and the
Partnerships, no prior owner of any Property engaged in any manufacturing or any
similar operations at any Property that (1) require the use, handling,
transportation, storage, treatment or disposal of any Hazardous Substance (other
than paints, stains, cleaning solvents, insecticides, herbicides, or other
substances that are used in the ordinary course of operating any Property and in
compliance with all applicable Environmental Laws) or (2) require permits or are
otherwise regulated pursuant to any Environmental Law; (D) none of the Company,
the Partnerships or any Subsidiary and, to the knowledge of the Company, no
prior owner of any Property has received any notice of a claim under or pursuant
to any Environmental Law applicable to a Property or under common law pertaining
to Hazardous Substances on any Property or pertaining to other property at which
Hazardous Substances generated at any Property have come to be located; (E) none
of the Company, the Partnerships or any Subsidiary and, to the best knowledge of
the Company, no prior owner of any Property has received any notice from any
Governmental Authority (as defined below) claiming any violation of any
Environmental Law that is uncured or unremediated as of the date hereof; and (F)
no Property (1) is included or proposed for inclusion on the National Priorities
List issued pursuant to CERCLA (as defined below) by the United States
Environmental Protection Agency (the "EPA") or on the Comprehensive
Environmental Response, Compensation, and Liability Information System database
maintained by the EPA as a potential CERCLA removal, remedial or response site
or (2) is included or proposed for inclusion on, any similar list of potentially
contaminated sites pursuant to any other applicable Environmental Law nor has
the Company, either of the Partnerships or any Subsidiary received any written
notice from the EPA or any other Governmental Authority proposing the inclusion
of any Property on such list. As used herein, "Hazardous Substance" shall
include any hazardous substance, hazardous waste, toxic or dangerous substance,
pollutant, asbestos-containing materials, PCBs, pesticides, explosives,
radioactive materials, dioxins, urea formaldehyde insulation, pollutant or
waste, including any such substance, pollutant or waste identified, listed or
regulated under any Environmental Law (including, without limitation, materials
listed in the United States Department of Transportation Optional Hazardous
Material Table, 49 C.F.R. ss. 172.101, as the same may now or hereafter be
amended, or in the EPA's List of Hazardous Substances and Reportable Quantities,
40 C.F.R. Part 3202, as the same may now or hereafter be amended); "Environment"
shall mean any surface water, drinking water, ground water, land surface,
subsurface strata, river sediment, buildings and structures; "Environmental Law"
shall mean the Comprehensive Environmental Response, Compensation and Liability
Act, as amended (42 U.S.C. ss. 9601 et seq.) ("CERCLA"), the Resource
Conservation Recovery Act, as amended (42 U.S.C. ss. 6901 et seq.), the Clean
Air Act, as amended (42 U.S.C. ss. 7401 et seq.), the Clean Water Act, as
amended (33 U.S.C.
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ss. 1251 et seq.), the Toxic Substances Control Act, as amended (15 U.S.C. ss.
2601 et seq.), the Toxic Substances Control Act, as amended (29 U.S.C. ss. 651
et seq.), the Hazardous Materials Transportation Act, as amended (49 U.S.C. ss.
1801 et seq.), together with all rules, regulations and orders promulgated
thereunder and all other federal, state and local laws, ordinances, rules,
regulations and orders relating to the protection of the environment from
environmental effects; "Governmental Authority" shall mean any federal, state or
local governmental office, agency or authority having the duty or authority to
promulgate, implement or enforce any Environmental Law; "Lien" shall mean, with
respect to any Property, any material mortgage, deed of trust, pledge, security
interest, lien, encumbrance, penalty, fine, charge, assessment, judgment or
other liability in, on or affecting such Property; and "Release" shall mean any
spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, dumping, emanating or disposing of any Hazardous Substance
into the Environment, including, without limitation, the abandonment or discard
of barrels, containers, tanks (including, without limitation, underground
storage tanks) or other receptacles containing or previously containing any
Hazardous Substance or any release, emission, discharge or similar term, as
those terms are defined or used in any Environmental Law.
4.24. Taxes. Each of the Company, the Partnerships and the
Subsidiaries has filed all federal, state, local and foreign income and
franchise tax returns which have been required to be filed and each such tax
return was filed on or prior to the date on which such tax return was required
to be filed or, in lieu of such timely filings, each of the Company, the
Partnerships, or the Subsidiaries, as the case may be, has duly and timely filed
such applications for extension as may be required to effect all necessary
extensions (such extensions having been obtained and remaining in full force and
effect) and has paid all taxes shown thereon as due and payable and any other
assessment, fine or penalty levied against it, to the extent that any of the
foregoing is due and payable, except, in all cases, for any such tax assessment,
fine or penalty that is being contested in good faith through appropriate
proceedings and as to which appropriate reserves have been established.
4.25. Registration Rights. Except as disclosed in the Registration
Statement and except for (i) persons who received Units or shares of Common
Stock in connection with the formation of the Company, or (ii) persons who
received shares of Common Stock, options to acquire shares of Common Stock or
Units in connection with transactions with the Partnerships or the Company,
there are no persons with registration or other similar rights to have any
securities registered pursuant to the Registration Statement or otherwise
registered by the Company under the Securities Act. Other xxxx Xxxxxxx Xxxxx, no
stockholder of the Company has any right, which has not or will not have been
waived or has not expired by reason of lapse of time following notification of
the Company's intent to file any Resale Registration Statement (as defined
below) pursuant to Section 7.1, to require the Company to register the sale of
any shares owned by such stockholder under the Resale Registration Statement.
4.26. Title to Properties. Each of the Company, the Partnerships
and the Subsidiaries (or the partnership or other entity owning the Property)
has obtained title insurance insuring good, marketable and lien free title to
the Properties owned by them (other than the Properties in which the applicable
entity owns less than a majority interest),
10
subject only to customary easements and encumbrances and other exceptions to
title which do not materially impair the operation, development or use thereof
for the purposes intended therefor as contemplated by the Prospectus on each of
such Properties.
4.27. NYSE Listing. The Purchased Shares will be listed on the New
York Stock Exchange on the Closing Date.
4.28. Insurance. Each of the Company, the Partnerships and the
Subsidiaries is 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 none of the Company, the
Partnerships and the Subsidiaries has any reason to believe that it will not be
able to renew its existing insurance coverage as and when such coverage expires
or to obtain similar coverage from similar insurers as may be necessary to
continue its businesses at a cost that would not have a Material Adverse Effect,
except as described in or contemplated by the Registration Statement and the
Prospectus.
4.29. Regulation M. The Company has not taken and will not take,
directly or indirectly, any action prohibited by Regulation M under the 0000
Xxx.
4.30. Regulation T. The Company will not use the proceeds from the
sale of the Purchased Shares for the purpose of purchasing or carrying
"securities" as such term is defined in Regulation T of the Board of Governors
of the Federal Reserve System.
4.31. ERISA. The assets of the Company and the Partnerships do not
constitute "plan assets" under the Employee Retirement Income Security Act of
1974, as amended.
4.32. Officers' Certificates. At or prior to the Closing, the
Company shall deliver a certificate of the Company executed by the President and
Chief Executive Officer and the Chief Financial Officer of the Company, dated
the Closing Date and in form and substance satisfactory to Xxxxxxx Xxxxx, to the
effect that the representations and warranties of the Company set forth in this
Section 4 are true and correct as of Closing Date with the same force and effect
as though expressly made on the Closing Date, and that the Company has complied
with all the agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to the Closing. Any certificate signed by any
officer of the Company, either of the Partnerships or any of the Subsidiaries
and delivered to Xxxxxxx Xxxxx or to counsel for Xxxxxxx Xxxxx shall be deemed a
representation and warranty by such entity to Xxxxxxx Xxxxx as to the matters
covered thereby.
4.33. Legal Opinions. At or prior to the Closing, counsel to the
Company will deliver a legal opinion dated the Closing Date in substantially the
form of Exhibit A hereto.
4.34. Comfort Letter. The Company shall cooperate with KPMG Peat
Marwick LLP and KPMG Peat Marwick LLP shall, prior to the delivery of the
Purchased Shares to Xxxxxxx Xxxxx, deliver to Xxxxxxx Xxxxx a letter, in form
and substance satisfactory to Xxxxxxx Xxxxx, to the effect that: (i) they are
independent public accountants with respect to the Company as required by the
Securities Act and the 1933 Act Regulations;
11
(ii) it is their opinion that the financial statements and any supporting
schedules included in the Registration Statement and covered by their opinions
therein comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and the 1933 Act Regulations;
(iii) based upon limited procedures set forth in detail in such letter,
including a reading of the latest available interim financial statements of the
Company, a reading of the minute books of the Company, inquiries of officials of
the Company responsible for financial and accounting matters and such other
inquiries and procedures as may be specified in such letter, nothing has come to
their attention that caused them to believe that (A) the unaudited financial
statements of the Company included in the Registration Statement do not comply
as to form in all material respects with the applicable accounting requirements
of the Securities Act, the 1933 Act Regulations, the Exchange Act, and the 1934
Act Regulations, or material modifications are necessary for them to be
presented in conformity with generally accepted accounting principles, (B) the
operating data and balance sheet data set forth in the Prospectus under the
caption "Selected Consolidated Financial Data" were not determined on a basis
substantially consistent with that used in determining the corresponding amounts
in the audited financial statements included in the Registration Statement, (C)
the pro forma financial information in the Registration Statement was not
determined on a basis substantially consistent with that of the audited
financial statements included in the Registration Statement or did not comply as
to form in all material respects with the applicable accounting requirements of
Rule 11-02 of Regulation S-X or (D) at a specified date not more than five days
prior to the date of this Agreement, there has been any change in the capital
stock of the Company or any increase in the debt of the Company or any decrease
in the net assets of the Company as compared with the amounts shown in the most
recent consolidated balance sheet of the Company included in the Registration
Statement, or, during the period from the date of the most recent consolidated
statement of operations included in the Registration Statement to a specified
date not more than five days prior to the date of this Agreement, there were any
decreases, as compared with the corresponding period in the preceding year, in
revenues, net income or funds from operations of the Company except in all
instances for changes, increases or decreases which the Registration Statement
and the Prospectus disclose have occurred or may occur; and (iv) in addition to
the audit referred to in their opinions and the limited procedures referred to
in clause (iii) above, they have carried out certain specified procedures, not
constituting an audit, with respect to certain amounts, percentages and
financial information which are included in the Registration Statement and
Prospectus and which are specified by Xxxxxxx Xxxxx in a letter, and have found
such amounts, percentages and financial information to be in agreement with the
relevant accounting, financial and other records of the Company identified in
such letter.
SECTION 5. Representations, Warranties and Covenants of Xxxxxxx Xxxxx.
5.1. Investment. Xxxxxxx Xxxxx represents and warrants to, and
covenants with, the Company that: (i) it is knowledgeable, sophisticated and
experienced in making, and is qualified to make, decisions with respect to
investments in securities presenting an investment decision like that involved
in the purchase of the Shares, including investments in securities issued by the
Company; (ii) Xxxxxxx Xxxxx is acquiring the Shares in the ordinary course of
its business and for its own account for investment (as defined for purposes of
the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976 and the regulations
thereunder) only and with no present intention of distributing any of the Shares
or any arrangement
12
or understanding with any other persons regarding the distribution of any of the
Shares (this representation and warranty not limiting the right of Xxxxxxx Xxxxx
to sell pursuant to any Resale Registration Statement); (iii) Xxxxxxx Xxxxx will
not, directly or indirectly, sell or otherwise dispose of (or solicit any offers
to purchase or otherwise acquire) any of the Shares except in compliance with
the Securities Act and any applicable state securities or blue sky laws; (iv)
Xxxxxxx Xxxxx has completed or caused to be completed the Registration Statement
Questionnaire and the Stock Certificate Questionnaire, both attached hereto as
Appendix I, for use in preparing the Resale Registration Statement and the
answers thereto are true and correct as of the date hereof and will be true and
correct as of the effective date of the Resale Registration Statement.
5.2. Resale. Xxxxxxx Xxxxx acknowledges and agrees that in
connection with any transfer of the Shares it will provide to the transfer agent
prompt notice of any Shares sold pursuant to the Resale Registration Statement
or otherwise transferred in compliance with applicable federal and state
securities laws. Xxxxxxx Xxxxx acknowledges that there may occasionally be times
when the Company, under Section 7.2(a), may suspend the right of Xxxxxxx Xxxxx
to effect sales of the Shares through the use of the Resale Prospectus (as
defined below) forming a part of a Resale Registration Statement. Xxxxxxx Xxxxx
covenants to notify the Company promptly of its sale of all of the Shares.
5.3. Due Execution, Delivery and Performance of this Agreement.
Xxxxxxx Xxxxx represents and warrants to, and covenants with, the Company that
(i) Xxxxxxx Xxxxx has full right, power, authority and capacity to enter into
this Agreement and the Adjustment Agreement and to perform its obligations
hereunder and thereunder and consummate the transactions contemplated hereby and
thereby and has taken all necessary action to authorize the execution, delivery
and performance of this Agreement and the Adjustment Agreement by it, and (ii)
this Agreement and the Adjustment Agreement are valid and binding obligations of
Xxxxxxx Xxxxx, enforceable in accordance with their terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally, except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law) and except that enforcement of the
indemnification agreements in Section 7.4 hereof may be limited by public
policy.
5.4. Residence of Xxxxxxx Xxxxx. Xxxxxxx Xxxxx represents and
warrants that it is organized in the State of Delaware and has its principal
place of business in New York, New York.
5.5. Certain Tax Considerations. Xxxxxxx Xxxxx represents and
warrants that it is a "corporation" for U.S. federal income tax purposes and for
purposes of any exemptions from information reporting and backup withholding
requirements that may apply to payments by the Company to Xxxxxxx Xxxxx under
this Agreement.
SECTION 6. Survival of Representations, Warranties and Agreements.
Notwithstanding any investigation made by any party to this Agreement, all
representations, warranties, covenants and agreements made by the Company and
Xxxxxxx Xxxxx herein shall survive the execution of this Purchase Agreement, the
Adjustment Agreement, the delivery
13
to Xxxxxxx Xxxxx of the Purchased Shares, the payment therefor and the
consummation of any other transactions contemplated hereby by the Adjustment
Agreement.
SECTION 7. Registration of the Shares; Compliance with the Securities Act.
7.1. Registration Procedures and Expenses. The Company shall:
(a) (i) as soon as practicable after the Closing, but in no
event later than three business days thereafter, prepare
and file with the Commission an initial resale registration
statement, an amendment to the Registration Statement or a
supplement to the prospectus included in the initial resale
registration statement which will permit the public resale
by Xxxxxxx Xxxxx, from time to time, of the Purchased
Shares in any of the manners specified in the Adjustment
Agreement (the "Initial Resale Registration Statement")
and, if such filing is not effective upon filing, use its
best efforts to obtain effectiveness of the Initial Resale
Registration Statement as promptly as practicable following
such filing; and (ii) as soon as practicable after the
issuance of Additional Shares, prepare and file with the
Commission any amendments to the Initial Resale
Registration Statement, supplements to a prospectus
included in the Initial Registration Statement or
additional Resale Registration Statements as shall be
necessary to cover the public resale by Xxxxxxx Xxxxx of
the Additional Shares in the same manner as contemplated by
the Initial Resale Registration Statement for the Purchased
Shares. For purposes of this Purchase Agreement, "Resale
Registration Statement" means the Initial Resale
Registration Statement, any such amendment or additional
Resale Registration Statement or any other registration
statement under the Securities Act covering the resale by
Xxxxxxx Xxxxx of the Shares filed and maintained
continuously effective by the Company pursuant to the
provisions of this Section 7, including the prospectus
contained therein (the "Resale Prospectus"), any amendments
and supplements to any such registration statement,
including all post-effective amendments thereto, and all
exhibits and all material incorporated by reference into
any such registration statement;
(b) use its commercially reasonable best efforts to prevent the
issuance of any order suspending the effectiveness of the
Resale Registration Statement or Resale Prospectus or
suspending the qualification (or exemption from
qualification) of any of the Shares in any jurisdiction;
(c) prepare and file with the Commission such amendments and
supplements to the Resale Registration Statement and the
Resale Prospectus as may be reasonably requested by Xxxxxxx
Xxxxx in order to accomplish the public resale or other
disposition of any of
14
the Shares in accordance with the terms of the Adjustment
Agreement, or as may be necessary to keep the Resale
Registration Statement effective until the date on which
either (i) the Shares covered thereby have been sold by or
on behalf of Xxxxxxx Xxxxx or (ii) Xxxxxxx Xxxxx has
advised the Company that it no longer requires that the
Resale Registration Statement remain effective;
(d) furnish to Xxxxxxx Xxxxx with respect to the Shares
registered under the Resale Registration Statement such
reasonable number of copies of the Resale Prospectus,
including any supplements and amendments thereto, as are
necessary to facilitate the public sale or other
disposition of all or any of the Shares by Xxxxxxx Xxxxx;
(e) in order to facilitate the public sale or other disposition
of all or any of the Shares by Xxxxxxx Xxxxx, furnish to
Xxxxxxx Xxxxx with respect to the Shares registered under
any Resale Registration Statement, in connection with any
such public sale or other disposition, an opinion of
counsel to the Company covering the matters set forth in
Exhibit B hereto and such other documents as Xxxxxxx Xxxxx
may reasonably request (including a comfort letter from the
Company's independent certified public accountants and a
"bring down" certificate of representations and warranties
in connection with sales of Shares under the Resale
Registration Statement) (collectively, the "Resale Closing
Documents") (i) upon effectiveness of the Initial Resale
Registration Statement, (ii) if the Shares are publicly
sold or otherwise disposed of through an underwritten
offering or a block trade, as of either the date of the
closing or the date of pricing, as applicable upon prior
notice from Xxxxxxx Xxxxx to the Company as to which date
applies, and (iii) if the Shares are sold or otherwise
disposed of through a continuous offering, upon
commencement of the offering and quarterly thereafter for
the duration of the offering; provided, however, that the
Company shall not be required to deliver any Resale Closing
Documents in the event that the aggregate offering price of
any Shares offered in an underwritten offering or a block
trade is less than $20,000,000, unless, as of the date of
any such underwritten offering or block sale, the Company
has not made any previous delivery of Resale Closing
Documents to Xxxxxxx Xxxxx in connection with any other
public sale or other disposition of the Shares;
(f) use its best efforts to prevent the happening of any
event that would cause any such Resale Registration
Statement to contain a material misstatement or
omission or to be not effective and continuously
useable for resale of the Shares during the period that
such Resale Registration Statement is required to be
effective and usable;
15
(g) file documents required of the Company for normal blue sky
clearance in states specified in writing by Xxxxxxx Xxxxx;
provided, however, that the Company shall not be required
to qualify to do business or consent to service of process
in any jurisdiction in which it is not now so qualified or
has not so consented;
(h) bear all expenses in connection with the procedures in
paragraphs (a) through (f) of this Section 7.1 and Section
7.2(a) and the registration of the Shares pursuant to each
Resale Registration Statement, which expenses shall not
include brokerage or underwriting commissions or taxes of
any kind (including without limitation, transfer bonuses)
with respect to any sale or other disposition of Shares by
Xxxxxxx Xxxxx or any legal, accounting and other expenses
incurred by Xxxxxxx Xxxxx, which expenses shall be borne by
Xxxxxxx Xxxxx; and
(i) promptly file any necessary listing applications or
amendments to existing listing applications to cause any
Additional Shares issued to Xxxxxxx Xxxxx to be listed or
admitted to trading on the New York Stock Exchange or any
national stock exchange or automated quotation system on
which the Company's Common Shares are then listed or
traded.
7.2. Covenants in Connection with Resale Registration.
(a) The Company hereby covenants with Xxxxxxx Xxxxx that (i) it
shall not file any Resale Registration Statement or Resale Prospectus or any
amendment or supplement thereto, unless a copy thereof shall have been first
submitted to Xxxxxxx Xxxxx and Xxxxxxx Xxxxx shall not have objected thereto in
good faith (provided that if Xxxxxxx Xxxxx does not object within two business
days of receiving any such material, it shall be deemed to have no objection
thereto); (ii) it shall immediately notify Xxxxxxx Xxxxx of the issuance by the
Commission of any stop order suspending the effectiveness of any Resale
Registration Statement or the initiation of any proceedings for such purpose;
(iii) it shall make every reasonable effort to obtain promptly the withdrawal of
any order suspending the effectiveness of any Resale Registration Statement at
the earliest possible moment; (iv) it shall immediately notify Xxxxxxx Xxxxx of
the receipt of any notification with respect to the suspension of the
qualification of the Shares for sale under the securities or blue sky laws of
any jurisdiction or the initiation of any proceeding for such purpose; and (v)
it shall immediately notify Xxxxxxx Xxxxx orally or in writing of the happening
of any event or the failure of any event to occur or the existence of any fact
or circumstance that results in any Resale Registration Statement, amendment
thereto, Resale Prospectus, prospectus supplement to the Resale Prospectus or
any document incorporated therein by reference containing an untrue statement of
a material fact or omitting to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, and promptly
shall prepare, file with the Commission and furnish to Xxxxxxx Xxxxx a
reasonable number of copies of a post-effective amendment or supplement to the
Resale Registration Statement or the Resale Prospectus, or any document
incorporated therein by reference or other required document so that, as
thereafter delivered to the purchasers of the
16
Shares, the Resale Prospectus will not contain an untrue statement of a material
fact or omit to state any material fact necessary to make the statements therein
not misleading. Xxxxxxx Xxxxx hereby covenants that it will not sell any Shares
pursuant to the Resale Registration Statement during the period commencing at
the time at which the Company gives Xxxxxxx Xxxxx notice (which such notice
shall have been given by the Company as promptly as practicable) of the
suspension of the use of said Resale Prospectus by reason of the occurrence of
events described in clauses (ii), (iv) and (v) above and ending at the time the
Company gives Xxxxxxx Xxxxx oral or written notice that Xxxxxxx Xxxxx may
thereafter effect sales pursuant to said Resale Prospectus. Xxxxxxx Xxxxx and
the Company agree that circumstances may exist where the obligation of the
Company under clause (v) above to promptly prepare and file a document may
conflict with a valid business purpose of the Company to avoid premature
disclosure of a material corporate transaction, in which case the Company may
delay preparing and filing a document for a reasonable period of time after
taking into account the valid business purposes of the Company, the Company's
disclosure obligations under the federal securities laws and the adverse effect
of the delay on Xxxxxxx Xxxxx.
(b) Xxxxxxx Xxxxx shall cooperate with the Company in connection
with the preparation of the Resale Registration Statement and shall furnish to
the Company, in a timely manner, all information in its possession or reasonably
obtainable by it and necessary for inclusion in the Resale Registration
Statement (including, without limitation, information relating to the ownership
by Xxxxxxx Xxxxx of Common Shares and the plan of distribution). Xxxxxxx Xxxxx
also shall furnish to the Company, in connection with the commencement of any
continuous offering of Shares under any Resale Registration Statement or
connection with a public sale or other disposition of the Shares through an
underwritten offering or block trade, such documentation as is customary and
reasonably necessary in connection with such transactions. Xxxxxxx Xxxxx also
shall deliver a copy of the Resale Prospectus to all purchasers from it of
Common Shares in accordance with the requirements of applicable law.
(c) Xxxxxxx Xxxxx shall notify the Company at least two business
days prior to the earlier of the date on which it intends to commence effecting
any resales of Shares under a Resale Registration Statement or the date of
pricing with respect to the public sale or other disposition of any Shares under
a Resale Registration Statement effected through an underwritten offering or
block trade and if the Company does not, within such two day period, advise
Xxxxxxx Xxxxx of the existence of any facts of the type referred to in Section
7.2(a) above, then the Company shall be deemed to have certified and represented
to Xxxxxxx Xxxxx that no such facts then exist and Xxxxxxx Xxxxx may rely on
such certificate and representations in making such sales. The preceding
sentence shall in no way limit the Company's obligations under Section 7.2(a)
above.
(d) The Company shall cooperate with Xxxxxxx Xxxxx to facilitate
the timely preparation and delivery of certificates representing the Shares to
be sold under the Resale Registration Statements and not bearing any restrictive
legends and in such denominations and registered in such names as Xxxxxxx Xxxxx
may reasonably request at least one business day prior to the closing of any
sale of the Shares.
17
(e) If the Company notifies Xxxxxxx Xxxxx that it wishes a selling
stockholder under the Resale Registration Statement to effect an underwritten
offering or block trade of Shares, (i) Xxxxxxx Xxxxx shall have the right to
select the managing underwriters or the executing dealer, as the case may be,
who shall be subject to the approval of the Company, which approval shall not be
unreasonably withheld (it being understood that Xxxxxxx Xxxxx is, in any event,
reasonably acceptable to the Company for this purpose) and (ii) the Company
shall (A) enter into written agreements (including underwriting agreements) as
are customary in underwritten offerings or block trades, as the case may be; (B)
obtain an opinion of counsel to the Company and other entities reasonably
requested by the underwriters or the executing dealer, as the case may be, and
updates thereof (which may be in the form of a reliance letter) in form and
substance reasonably satisfactory to the managing underwriters or the executing
dealer, as the case may be, and Xxxxxxx Xxxxx addressed to the underwriters or
the executing dealer, as the case may be, and Xxxxxxx Xxxxx covering the matters
customarily covered in opinions requested in underwritten offerings or block
trades, as the case may be, and such other matters as may be reasonably
requested by such underwriters or the executing dealer, as the case may be, and
Xxxxxxx Xxxxx (it being agreed that the matters to be covered by such opinion
may be subject to customary qualifications and exceptions); (C) obtain "cold
comfort" letters and updates thereof in form and substance reasonably
satisfactory to the managing underwriters or the executing dealer, as the case
may be, and Xxxxxxx Xxxxx from the independent certified public accountants of
the Company (and, if necessary, other independent certified public accountants
of any affiliate or Subsidiary of the Company or of any business acquired by the
Company for which financial statements and financial data are, or are required
to be, included in the Resale Registration Statement), addressed to each of the
underwriters or the executing dealer, as the case may be, and Xxxxxxx Xxxxx, if
permitted by applicable accounting rules and statements, such letters to be in
customary form and covering matters of the type customarily covered in "cold
comfort" letters in connection with underwritten offerings or block trades, as
the case may be, and such other matters as may be reasonably requested by such
underwriters or the executing dealer, as the case may be, or Xxxxxxx Xxxxx in
accordance with Statement on Auditing Standards No. 72; (D) ensure that any
underwriting agreement contains indemnification provisions and procedures not
less favorable than those included herein (or such other provisions and
procedures acceptable to Xxxxxxx Xxxxx and the underwriters) with respect to all
parties to be indemnified pursuant to said section (including, without
limitation, the underwriters); and (E) deliver such other documents as are
customarily delivered in connection with closing of underwritten offerings or
block trades, as the case may be.
(f) The Company will make reasonably available for inspection by
Xxxxxxx Xxxxx or any underwriter, agent or broker-dealer participating in any
disposition of Shares under the Resale Registration Statement such information
and corporate documents as shall be reasonably necessary to enable them to
exercise any applicable due diligence responsibilities for the purposes of
applicable law, and cause the officers of the Company and its "significant
subsidiaries" (as that term is defined in Regulation S-X) to be available, upon
request at least two business days in advance, to respond to questions relevant
to such due diligence inquiries.
7.3. Transfer of Shares After Registration. Xxxxxxx Xxxxx agree
that it will not effect any disposition of the Shares or its right to purchase
the Shares that would constitute
18
a sale within the meaning of the Securities Act or pursuant to any applicable
state securities or blue sky laws except as contemplated in the Resale
Registration Statement or pursuant to an exemption from the registration
requirements of the Securities Act (including, without limitation, Rule 144
promulgated thereunder and any successor thereto) and that it will promptly
notify the Company of any changes in the information set forth in any such
Resale Registration Statement regarding Xxxxxxx Xxxxx or the plan of
distribution.
7.4. Indemnification. For the purpose of this Section 7.4 only,
the term "Resale Registration Statement" shall include any final prospectus,
exhibit, supplement or amendment included in or relating to any Resale
Registration Statement referred to in Section 7.1.
(a) Indemnification by Company. The Company will indemnify and
hold harmless Xxxxxxx Xxxxx and each person, if any, who controls Xxxxxxx Xxxxx
within the meaning of Section 15 of the Securities Act, and any director,
officer, employee or affiliate of Xxxxxxx Xxxxx, as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in any Resale Registration
Statement (or any amendment thereto), including the information deemed to be
part of any Resale Registration Statement pursuant to Rule 430A(b) of the 1933
Act Regulations, if applicable, or the omission or alleged omission therefrom of
a material fact required to be stated therein or necessary to make the
statements therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in any related Resale
Prospectus or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the Company shall not be required under this paragraph (i) to indemnify
Xxxxxxx Xxxxx with respect to any loss, liability, claim, damage or expense to
the extent such loss, liability, claim, damage or expense arises out of any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Company by Xxxxxxx Xxxxx specifically for inclusion in any Resale Registration
Statement or any related Resale Prospectus;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation or of any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim whatsoever
for which indemnification is provided under paragraph (i) above, if such
settlement is effected with the written consent of the Company; and
(iii) against any and all expense whatsoever (including,
without limitation, the fees and other charges of counsel chosen by you)
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceedings by any governmental agency or
body, commenced or threatened, or any claim whatsoever for which indemnification
is provided under paragraph (i) above, to the extent that any such expense is
not paid under paragraph (i) or (ii) above.
19
(b) Indemnification by Xxxxxxx Xxxxx. Xxxxxxx Xxxxx agrees to
indemnify and hold harmless the Company, and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act, and any
director, officer, employee or affiliate thereof, against any and all loss,
liability, claim, damage and expense described in the indemnity contained in
subsection (a) of this Section 7.4, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in any
Resale Registration Statement (or any amendment thereto) or any related Resale
Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company by Xxxxxxx Xxxxx
specifically for inclusion in any Resale Registration Statement or any related
Resale Prospectus.
(c) Proceedings. Each indemnified party shall give notice as
promptly as reasonably practicable to each indemnifying party of any action
commenced against it in respect of which indemnity may be sought hereunder, but
failure to so notify an indemnifying party shall not relieve such indemnifying
party from any liability hereunder to the extent it is not materially prejudiced
as a result thereof and in any event shall not relieve it from any liability
which it may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the defense of such
action. If it so elects within a reasonable time after receipt of such notice,
an indemnifying party, jointly with any other indemnifying parties receiving
such notice, may assume the defense of such action with counsel chosen by it and
approved by the indemnified parties defendant in such action, unless such
indemnified parties reasonably object to such assumption on the ground that the
named parties to any such action (including any impleaded parties) include both
such indemnified parties and an indemnifying party, and such indemnified parties
reasonably believe that there may be legal defenses available to them which are
different from or in addition to those available to such indemnifying party. If
an indemnifying party assumes the defense of such action, the indemnifying
parties shall not be liable for any fees and expenses of counsel for the
indemnified parties incurred thereafter in connection with such action. In no
event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 7.4 (whether
or not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional release of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 7.4(a)(ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii)
20
such indemnifying party shall have received notice of the terms of such
settlement at least 30 days prior to such settlement being entered into and
(iii) such indemnifying party shall not have reimbursed such indemnified party
in accordance with such request prior to the date of such settlement.
(d) Contribution. If the indemnification provided for in this
Section 7.4 is required by its terms but is for any reason held to be
unavailable to or otherwise insufficient to hold harmless an indemnified party
under subsections (a), (b) or (c) of this Section 7.4 in respect of any losses,
claims, damages, liabilities or expenses referred to herein, then each
applicable indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of any losses, claims, damages, liabilities
or expenses referred to herein, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company and Xxxxxxx Xxxxx from the
purchase and sale of the Shares or (ii) if the allocation provided in clause (i)
is not permitted by applicable law, in such proportion or as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company and Xxxxxxx Xxxxx in connection with the
statements or omissions or inaccuracies which resulted in such losses, claims,
damages, liabilities or expenses, as well as any other relevant equitable
considerations. The respective relative benefits received by the Company on the
one hand and Xxxxxxx Xxxxx on the other shall be deemed to be in the same
proportion as the amount paid by Xxxxxxx Xxxxx to the Company pursuant to this
Agreement and the Adjustment Agreement bears to the net proceeds retained by
Xxxxxxx Xxxxx from the transactions contemplated by this Agreement and the
Adjustment Agreement. The relative fault of the Company and Xxxxxxx Xxxxx shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or the alleged omission to
state a material fact or the inaccurate or the alleged inaccurate representation
and/or warranty relates to information supplied by the Company or by Xxxxxxx
Xxxxx and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The amount paid or
payable by a party as a result of the losses, claims, damages, liabilities and
expenses referred to above shall be deemed to include, subject to the
limitations set forth in subsection (c) of this Section 7.4 any reasonable legal
or other fees or expenses incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in
subsection (c) of this Section 7.4 with respect to notice of commencement of any
action shall apply if a claim for contribution is to be made under this
subsection (c); provided, however, that no additional notice shall be required
with respect to any action for which notice has been given under subsection (c)
for purposes of indemnification. The Company and Xxxxxxx Xxxxx agree that it
would not be just and equitable if contribution pursuant to this Section 7.4
were determined solely by pro rata allocation or by any other method of
allocation which does not take account of the equitable considerations referred
to in this subsection (d). Notwithstanding the provisions of this Section 7.4,
Xxxxxxx Xxxxx shall not be required to contribute any amount in excess of the
amount by which the aggregate net proceeds retained by Xxxxxxx Xxxxx from the
transactions contemplated hereby and by the Adjustment Agreement exceeds the
amount of any damages that Xxxxxxx Xxxxx has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
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7.5. Information Available. So long as any Resale Registration
Statement covering the resale of Common Shares owned by Xxxxxxx Xxxxx is
effective, the Company will furnish to Xxxxxxx Xxxxx:
(a) as soon as practicable after available, one copy of (i)
its Annual Report to Stockholders, (ii) its annual
report on Form 10-K, (iii) its quarterly reports to
stockholders (if any), (iv) its quarterly reports on
Form 10-Q, (v) a full copy of each Resale Registration
Statement covering the Shares (the foregoing, in each
case, excluding exhibits) and (vi) upon request, any or
all other filings made with the Commission by the
Company; and
(b) upon the reasonable request of Xxxxxxx Xxxxx, a
reasonable number of copies of the Resale Prospectus to
supply to any other party requiring copies of such
Resale Prospectus;
and the Company, upon the reasonable request of Xxxxxxx Xxxxx, xxxx meet with
Xxxxxxx Xxxxx or a representative thereof at the Company's headquarters to
discuss all information relevant for disclosure in the Resale Registration
Statement, subject to appropriate confidentiality limitations.
7.6. Remedies. The Company and Xxxxxxx Xxxxx acknowledge that
there would be no adequate remedy at law if the Company fails to perform any of
its obligations under this Section 7, and accordingly agree that Xxxxxxx Xxxxx,
in addition to any other remedy to which it may be entitled at law or in equity,
shall be entitled to compel specific performance of the obligations of the
Company under this Section 7, and the Company hereby waives the defense that a
remedy at law would be adequate.
7.7. Notice Requirement. The Company will notify Xxxxxxx Xxxxx at
any time it becomes aware that as a result of a change in the Company's capital
stock Xxxxxxx Xxxxx beneficially holds more than 4.9% of the outstanding Common
Shares.
SECTION 8. Broker's Fee. Other than any fees payable under or in
connection with the Adjustment Agreement, each of the parties hereto represents
that, on the basis of any actions and agreements by it, there are no brokers or
finders entitled to compensation in connection with the sale or issuance of the
Shares to Xxxxxxx Xxxxx.
SECTION 9. Notices. Unless otherwise specifically provided herein, all
notices, requests, consents and other communications hereunder shall be in
writing, shall be mailed by first-class registered or certified airmail, by
telegram or telecopy or sent by nationally recognized overnight express courier
postage prepaid, and shall be deemed given when so mailed or, in the case of
telecopies, when transmitted and receipt confirmed, and shall be delivered
addressed as follows:
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(a) if to the Company, to:
CarrAmerica Realty Corporation
0000 Xxxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxx X. Xxxxxx, Chief Financial Officer
with copies so mailed to:
Xxxxx & Xxxxxxx L.L.P.
000 Xxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
or to such other person at such other place as the Company
shall designate to Xxxxxxx Xxxxx in writing; and
(b) if to Xxxxxxx Xxxxx, to:
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxxxxxx Xxxxx World Headquarters
North Tower
World Financial Center
New York, New York 10281-1305
Attention: Xx. Xxxx Xxxx
SECTION 10. Changes. This Agreement may not be modified or amended except
pursuant to an instrument in writing signed by the Company and Xxxxxxx Xxxxx.
SECTION 11. Headings. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.
SECTION 12. Severability. In case any provision contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
SECTION 13. Successors and Assigns. Each of the parties may assign any of
its rights, or delegate any of its duties, under this Agreement if the other
party first consents to such assignment or delegation in writing, which consent
shall not be withheld unreasonably. This Purchase Agreement shall inure to the
benefit of and be binding upon (i) the successors of the parties and (ii) any
permitted assignee or transferee of rights and obligations of either party
pursuant to the Agreement. Any successor, assignee or transferee of a party
pursuant to the Agreement shall be held subject to all of the terms and
conditions hereof.
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SECTION 14. Transfer to Affiliate. Notwithstanding anything herein to the
contrary, Xxxxxxx Xxxxx may transfer the Shares and assign all of its rights
hereunder to any affiliate of Xxxxxxx Xxxxx; provided that (i) such affiliate is
not a "foreign person" (as defined for purposes of Section 897(h)(4)(B) of the
Code) and (ii) such transfer and assignment are consistent with the investment
representations set forth in Section 5.1 hereof. In the event of such a transfer
and assignment, such affiliate shall in all respects be substituted for Xxxxxxx
Xxxxx as a party hereto.
SECTION 15. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
the conflicts of law principles thereof.
SECTION 16. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and shall become effective
when one or more counterparts have been signed by each party hereto and
delivered to the other parties.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives as of the day and year first
above written.
CARRAMERICA REALTY CORPORATION
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxx
Title: Chief Financial Officer
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
By: /s/ Xxxx X'Xxxxxxx
-----------------------------------
Name: Xxxx X'Xxxxxxx
Title: Authorized Signatory
Appendix I
REGISTRATION STATEMENT QUESTIONNAIRE
In connection with the preparation of the Registration Statement, please
provide us with the following information:
1. Pursuant to the "Selling Stockholders" section of the Registration
Statement please state your or your organization's name exactly as it should
appear in the Registration Statement:
2. Please provide the number of shares that you or your organization
(including all affiliates) will own immediately after Closing, including those
Shares purchased by you or your organization (including all affiliates) pursuant
to this Purchase Agreement and those shares purchased by you or your
organization (including all affiliates) through other transactions:
3. Have you or your organization had any position, office or other
material relationship within the past three years with the Company or its
affiliates:
________ Yes _______ No
If yes, please indicate the nature of any such relationships below:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
