EXHIBIT 1.1
September 22, 1998
Xxxxxxxx & Co. Inc.
000 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Placement of Securities of Nationwide Health Properties, Inc.
Dear Sirs:
This letter (the "Agreement") confirms our agreement to
retain Xxxxxxxx & Co. Inc. (the "Placement Agent") as our
exclusive agent for a period commencing on the date of this
letter and terminating on September 30, 1998, unless extended by
the parties, to introduce Nationwide Health Properties, Inc. (the
"Company"), to certain investors as prospective purchasers of
1,500,000 shares ("Shares") of common stock, $0.10 par value per
share, of the Company (the "Common Stock"). The engagement
described herein (i) may be terminated by the Company at any time
prior to the closing date of the consummation of the sale of the
Shares and (ii) shall be in accordance with applicable laws and
pursuant to the following procedures and terms and conditions:
1. The Company will:
(a) Cause the Company's independent public accountants
to address and deliver to the Company and the
Placement Agent a letter or letters (which letters
are frequently referred to as "comfort letters") dated
the date hereof, and a "bring-down" letter dated as
of September 25, 1998 the "Closing Date"), both of
which letters will at all times be in form and
substance reasonably satisfactory to the Placement Agent.
(b) On the Closing Date, cause outside counsel to the
Company, to deliver opinions to the Placement Agent in
form and substance reasonably satisfactory to the
Placement Agent and its counsel.
(c) Apply for listing the Shares for trading on the New
York Stock Exchange, Inc. ("NYSE") within two business
days from the date hereof and will use its best efforts
to obtain approval from the NYSE with respect to such
listing on or prior to the Closing Date.
2. The Placement Agent will use reasonable efforts on
behalf of the Company in connection with the Placement Agent's
services hereunder. No sales of Shares shall be made to any person
without the prior approval of such person by the Company. The
Placement Agent's aggregate fee for introducing the prospective
investors will be equal to $0.25 per Share from the sale of the
Shares. Such fee shall be payable by the Company at the Closing
Date. The Placement Agent may, in its sole discretion, retain one
or more sub-placement agents.
3. The Company hereby agrees as follows:
(a) The Company will indemnify and hold harmless the
Placement Agent and each of its respective partners, directors,
officers, associates, affiliates, subsidiaries, employees,
consultants, attorneys and agents, and each person, if any,
controlling the Placement Agent or any of its affiliates within
the meaning of either Section 15 of the Securities Act of 1933,
as amended (the "Act") or Section 20 of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), from and against any
and all losses, claims, damages, liabilities or costs (and any
legal or other expenses incurred by such Placement Agent in
investigating or defending the same or in giving testimony or
furnishing documents in response to a request of any government
agency or to a subpoena) in any way relating to or in any
way arising out of the activities of the Placement Agent
contemplated by this letter, or in connection with the offering
or sale of the Shares to be sold by the Company as contemplated
hereunder. Such indemnity agreement shall not, however, cover any
such loss, claim, damage, liability, cost or expense which is held
in a final judgment of a court of competent jurisdiction (not
subject to further appeal) to have arisen out of the gross
negligence or willful misconduct of the Placement Agent.
(b) The Placement Agent will indemnify and hold harmless
the Company and each of its directors, officers, associates,
affiliates, subsidiaries, employees, consultants, attorneys, agents,
and each person controlling the Company or any of its affiliates
within the meaning of either Section 15 of the Act or Section 20 of
the Exchange Act from and against any and all losses, claims, damages,
liabilities, costs or expenses (and any legal or other expenses
incurred by such indemnitee in investigating or defending the same
or in giving testimony or furnishing documents in response to a
request of any government agency or to a subpoena) (i) which are
held in a final judgment of a court of competent jurisdiction (not
subject to further appeal) to have arisen out of the gross negligence
or willful misconduct of such Placement Agent or (ii) are based upon
information furnished in writing to the Company by the Placement Agent
expressly for use in the Prospectus, which information the parties
hereby agree is limited solely to that set forth under the caption
"Plan of Distribution" in the Prospectus Supplement (as hereinafter
defined).
(c) If any action, proceeding or investigation is commenced
as to which the indemnified party hereunder proposes to demand
indemnification under this letter agreement, it will notify the
indemnifying party with reasonable promptness. The indemnified
party shall have the right to retain counsel of its own choice (which
choice shall be reasonably satisfactory to the indemnifying party) to
represent it and such counsel shall, to the extent consistent with its
professional responsibilities, cooperate with the indemnifying
party and any counsel designated by the indemnifying party. The
indemnifying party will not be liable under this letter agreement for
any settlement of any claim against the indemnified party made without
the indemnifying party's written consent.
In order to provide for just and equitable contribution,
if a claim for indemnification pursuant to this paragraph 3 is made but
it is found in a final judgment by a court of competent jurisdiction
(not subject to further appeal) that such indemnification may not
be enforced in such case, even though the express provisions hereof
provided for indemnification in such case, then the Company, on
the one hand, and the Placement Agent, on the other hand, shall
contribute to the losses, claims, damages, liabilities or costs to
which the indemnified persons may be subject in accordance with the
relative benefits received from the offering and sale of the Shares
by the Company, on the one hand, and the Placement Agent, on the other
hand, and also the relative fault of the Company, on the one hand, and
the Placement Agent, on the other hand, in connection with the
statements, acts or omissions which resulted in such losses, claims,
damages, liabilities or costs, and the relevant equitable considerations
shall also be considered. No person found liable for a fraudulent
misrepresentation shall be entitled to contribution from any
person who is not also found liable for such fraudulent misrepresentation.
Notwithstanding the foregoing, the Placement Agent shall not be
obligated to contribute any amount hereunder that exceeds the
fees received by the Placement Agent in respect of the offering and
sale of the Shares.
4. The Company represents and warrants to the Placement
Agent as of the date hereof and as of the Closing Date as follows:
(a) On the effective date, the Registration Statement
complied in all material respects with the requirements of the
Act and the rules and regulations promulgated under the Act (the
"Regulations"); at the effective date the Basic Prospectus complied,
and at the Closing Date the Prospectus will comply, in all
material respects with the requirements of the Act and the Regulations;
and (ii) the Registration Statement at the effective date and as
amended or supplemented on the date hereof and on the Closing Date
did not, does not and will not contain an untrue statement of
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
and the Prospectus as of any such time, did not, does not and will
not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; provided, however, that the representations and
warranties in this subsection 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 by the Placement Agent expressly for use therein.
As used in this Agreement, the term "Registration Statement" means
the "shelf" registration statement on Form S-3 (File No. 333-17061),
as amended, as declared effective by the Securities and Exchange
Commission (the "SEC"), including exhibits, financial statements,
schedules and documents incorporated by reference therein. The
term "Basic Prospectus" means the prospectus included in the
Registration Statement. The term "Prospectus Supplement"
means the prospectus supplement specifically relating to the
Shares as filed with the Commission pursuant to Rule 424 under
the Act. The term "Prospectus" means the Basic Prospectus and
the Prospectus Supplement. Any reference herein to the Registration
Statement or the Prospectus shall be deemed to refer to and include
the documents incorporated by reference therein as of the date
hereof or the date of the Prospectus, as the case may be, and any
reference herein to any amendment or supplement to the Registration
Statement or the Prospectus shall be deemed to refer to and include
any documents filed after such date and through the date of such
amendment or supplement under the Exchange Act and so incorporated
by reference.
(b) Since the date 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 or any
development involving a prospective material adverse change in or
affecting the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and
the subsidiaries of the Company (the "Subsidiaries") considered as
one enterprise, whether or not arising in the ordinary course of
business, (B) there have been no transactions entered into by the
Company or any of its Subsidiaries, other than those in the ordinary
course of business, which are material with respect to the Company and
its Subsidiaries considered as one enterprise, and (C) except for
regular quarterly dividends, there has been no dividend or distribution
of any kind declared, paid or made by the Company on any class of its
capital stock.
(c) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Maryland. Each of the Subsidiaries of the Company has been
duly organized and is validly existing in good standing under the laws
of its jurisdiction of organization. Each of the Company and its
Subsidiaries has the corporate power and authority to own and
lease its properties and to conduct its business as described in the
Prospectus; and each of the Company and its Subsidiaries is duly
qualified to transact business in each jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure to so qualify would not have a material adverse effect on
the condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company and its Subsidiaries
considered as one enterprise.
(d) The authorized capital stock of the Company consists
of 5,000,000 shares of preferred stock, $1.00 par value per share,
and 100,000,000 shares of Common Stock. The issued and outstanding
capital stock of the Company will be as set forth in the Company's
balance sheet at June 30, 1998 contained in the Company's Quarterly
Report on Form 10-Q for the period ended June 30, 1998 incorporated
by reference in the Prospectus (except for subsequent issuances, if
any, pursuant to employee benefit plans or the exercise of convertible
securities referred to in the Prospectus); the issued and outstanding
shares of common stock have been duly authorized and validly issued
and are fully paid and non-assessable; the Shares have been duly
authorized and, when issued and delivered as contemplated hereby,
will be validly issued, fully paid and non-assessable; and the issuance
of the Shares is not subject to preemptive or other similar rights.
(e) Neither the Company nor any of its Subsidiaries is in
violation of its organizational documents or in default in the
performance or observance of any material obligation, agreement,
covenant or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other instrument or agreement
to which the Company or any if its Subsidiaries is a party or by which
it or any of them may be bound, or to which any of the property or
assets of the Company or any of its Subsidiaries is subject where such
a violation or default would have a material adverse effect on the
Company or any of its Subsidiaries, considered as one enterprise; and,
the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated herein have been duly
authorized by all necessary action and will not conflict with or
constitute a material breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of its Subsidiaries pursuant
to, any contract, indenture, mortgage, loan agreement, note, lease or
other material instrument or agreement to which the Company or any of
its Subsidiaries is a party or by which it or any of them may be bound,
or to which any of the property or assets of the Company or any of its
Subsidiaries is subject, nor will any such action result in any
violation of the provisions of the charter or by-laws of the Company
or any of its Subsidiaries or any applicable law, or administrative or
court decree.
(f) The Company is organized in conformity with the
requirements for qualification and, as of the date hereof and as
of the Closing Date, operates in a manner that qualifies it as a "real
estate investment trust" under the Internal Revenue Code of 1986, as
amended (the "Code"), and the rules and regulations thereunder and will
be so qualified after giving effect to the sale of the Securities.
(g) The Company is not required to be registered under
the Investment Company Act of 1940, as amended.
(h) There is no action, suit or proceeding before or by
any court or governmental agency or body, domestic or foreign, now
pending, or, to the knowledge of the Company, threatened, against or
affecting the Company or any of its Subsidiaries, which is required to
be disclosed in the Prospectus (other than as disclosed therein), or
which might result in any material adverse change in the condition,
financial or otherwise, or in the earnings or business affairs of the
Company and its Subsidiaries considered as one enterprise, or which
might materially and adversely affect their respective property or
assets or which might materially and adversely affect the consummation
of this Agreement; all pending legal or governmental proceedings to
which the Company or any of its Subsidiaries is a party or of which any
of their respective property or assets is the subject which are not
described in the Prospectus, including ordinary routine litigation
incidental to the business, are, considered in the aggregate, not
material to the business of the Company and its Subsidiaries considered
as one enterprise.
(i) No authorization, approval or consent of any court or
United States federal or state governmental authority or agency
is necessary in connection with the sale of the Shares hereunder,
except such as may be required under the Act, the Regulations, state
securities laws, real estate syndication laws or NYSE rules and
regulations.
(j) The Company and its Subsidiaries possess such
material certificates, authorities or permits issued by the appropriate
state, federal or foreign regulatory agencies or bodies necessary to
conduct the business now conducted by them, and neither the Company nor
any of its Subsidiaries 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 or business
affairs of the Company and its Subsidiaries considered as one enterprise.
(k) The Company has full power and authority to enter
into this Agreement, and this Agreement has been duly authorized, executed
and delivered by the Company.
(l) The Company has good and marketable title to all of
the properties and assets reflected in the audited financial
statements contained in the Prospectus, subject to no lien, mortgage,
pledge or encumbrance of any kind except those reflected in such financial
statements (or as otherwise described in the Prospectus) or which
are not material.
(m) Any certificate signed by any officer of the Company
and delivered to the Placement Agent or to counsel for the Placement
Agent shall be deemed a representation and warranty by the Company to
the Placement Agent as to the matters covered thereby.
5. The Placement Agent represents and warrants to the
Company that, assuming compliance by the Company with all relevant
provisions of the Act in connection with the Prospectus, the Placement
Agent will conduct all offers and sales of the Shares in compliance with
the relevant provisions of the Act and the Regulations and various
state securities laws and regulations.
6. This Agreement shall be governed by the laws of the
State of New York governing contracts made and to be performed in such
State without giving effect to principles of conflicts of law.
7. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original and all of which together
shall be deemed to be the same Agreement.
8. If the foregoing is in accord with your understanding
of our agreement, please sign in the space provided below and return
a signed copy of this letter to the Company.
Sincerely,
NATIONWIDE HEALTH PROPERTIES,INC.
By: /s/ Xxxx X. Xxxxxxx
----------------------------
Name: Xxxx X. Xxxxxxx
Title: Senior Vice President
and Chief Financial
Officer
Accepted by:
XXXXXXXX & CO. INC.
By: /s/ Xxxxxxx X. Xx Xxxxxx
--------------------------
Xxxxxxx X. Xx Xxxxxx
Managing Director
