Execution Copy
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CHARTER MUNICIPAL MORTGAGE ACCEPTANCE COMPANY
(a Delaware business trust)
7,900,000 Common Shares of Beneficial Interest
(no par value)
UNDERWRITING AGREEMENT
May 10, 2001
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UNDERWRITING AGREEMENT
May 10, 2001
UBS Warburg LLC,
as Representative of the several Underwriters
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
Charter Municipal Mortgage Acceptance Company, a Delaware
business trust (the "Company"), proposes to issue and sell to the underwriters
named in Schedule A annexed hereto (the "Underwriters") an aggregate of
7,900,000 common shares of beneficial interest (the "Firm Shares"), no par value
(the "Common Shares"), of the Company. In addition, solely for the purpose of
covering over-allotments, the Company proposes to grant to the Underwriters the
option to purchase from the Company up to an additional 1,185,000 Common Shares
(the "Additional Shares"). The Firm Shares and the Additional Shares are
hereinafter collectively sometimes referred to as the "Shares". The Shares are
described in the Prospectus which is referred to below.
The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (No. 333-57384) covering
the registration of the Shares under the Securities Act of 1933, as amended (the
"Act"). Promptly after execution and delivery of this Agreement, the Company
will prepare and file a prospectus in accordance with the provisions of Rule
424(b)(2) of the Act. Each prospectus and prospectus supplement used prior to
the execution and delivery of this Agreement are herein collectively called a
"Preliminary Prospectus." Such registration statement, including the exhibits
thereto, schedules thereto, if any, and the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Act, in each case, at the time
such registration statement became effective, is herein called the "Registration
Statement." Any registration statement filed in accordance with the provisions
of Rule 462(b) of the Act is herein referred to as the "Rule 462(b) Registration
Statement," and after such filing the term "Registration Statement" shall
include the Rule 462(b) Registration Statement. The final prospectus and
prospectus supplement relating to the Shares, including the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the Act,
in each case, in the form first furnished to the Underwriters for use in
connection with the offering of the Shares, are herein collectively called the
"Prospectus." For purposes of this Agreement, all references to the Registration
Statement, any Preliminary Prospectus, the Prospectus or any amendment or
supplement to any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("XXXXX").
All references in this Agreement to financial statements and
schedules and other information which is "contained," "included," "stated,"
"described" or "disclosed" in the Registration Statement, any Preliminary
Prospectus or the Prospectus (or other references of like import) shall be
deemed to mean and include all such financial statements and schedules and other
information which is incorporated by reference in the Registration Statement,
any
Preliminary Prospectus or the Prospectus, as the case may be at or prior to the
execution and delivery of this Agreement; and all references in this Agreement
to amendments or supplements to the Registration Statement, any Preliminary
Prospectus 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"), which is incorporated by reference in the Registration
Statement, such Preliminary Prospectus or the Prospectus, as the case may be,
after the execution and delivery of this Agreement.
The Company and the Underwriters agree as follows:
1. Sale and Purchase. Upon the basis of the warranties and
representations and subject to the terms and conditions herein set forth, the
Company agrees to sell to the respective Underwriters and each of the
Underwriters, severally and not jointly, agrees to purchase from the Company the
aggregate number of Firm Shares set forth opposite the name of such Underwriter
in Schedule A attached hereto in each case at a purchase price of $13.89 per
Common Share. The Company is advised by you that the Underwriters intend (i) to
make a public offering of their respective portions of the Firm Shares as in
your judgment is advisable and (ii) initially to offer the Firm Shares upon the
terms set forth in the Prospectus. You may from time to time increase or
decrease the public offering price after the initial public offering to such
extent as you may determine.
In addition, the Company hereby grants to the several
Underwriters the option to purchase, and upon the basis of the representations
and warranties and subject to the terms and conditions herein set forth, the
Underwriters shall have the right to purchase, severally and not jointly, from
the Company, ratably in accordance with the number of Firm Shares to be
purchased by each of them, all or a portion of the Additional Shares as may be
necessary to cover over-allotments made in connection with the offering of the
Firm Shares, at the same purchase price per share to be paid by the Underwriters
to the Company for the Firm Shares. This option may be exercised by you on
behalf of the several Underwriters at any time (but not more than once) on or
before the thirtieth calendar day following the date hereof, by written notice
to the Company. Such notice shall set forth the aggregate number of Additional
Shares as to which the option is being exercised, and the date and time when the
Additional Shares are to be delivered (such date and time being herein referred
to as the "additional time of purchase"); provided, however, that the additional
time of purchase shall not be earlier than the time of purchase (as defined
below) nor earlier than the second New York business day after the date on which
the option shall have been exercised nor later than the tenth New York business
day after the date on which the option shall have been exercised. The number of
Additional Shares to be sold to each Underwriter shall be the number which bears
the same proportion to the aggregate number of Additional Shares being purchased
as the number of Firm Shares set forth opposite the name of such Underwriter on
Schedule A hereto bears to the total number of Firm Shares (subject, in each
case, to such adjustment as you may determine to eliminate fractional shares).
2. Payment and Delivery. Payment of the purchase price for the
Firm Shares shall be made to the Company by Federal Funds wire transfer, against
delivery of the certificates for the Firm Shares to you through the facilities
of The Depository Trust Company ("DTC") for the respective accounts of the
Underwriters. Such payment and delivery shall be made at 10:00 A.M., New York
City time, on May 15, 2001 (unless another time shall be agreed to by
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you and the Company or unless postponed in accordance with the provisions of
Section 8 hereof). The time at which such payment and delivery are actually made
is hereinafter sometimes called the "time of purchase". Certificates for the
Firm Shares shall be delivered to you in definitive form in such names and in
such denominations as you shall specify on the second New York business day
preceding the time of purchase. For the purpose of expediting the checking of
the certificates for the Firm Shares by you, the Company agrees to make such
certificates available to you for such purpose at least one full New York
business day preceding the time of purchase.
Payment of the purchase price for the Additional Shares shall be
made at the additional time of purchase in the same manner and at the same
office as the payment for the Firm Shares. Certificates for the Additional
Shares shall be delivered to you in definitive form in such names and in such
denominations as you shall specify no later than the second New York business
day preceding the additional time of purchase. For the purpose of expediting the
checking of the certificates for the Additional Shares by you, the Company
agrees to make such certificates available to you for such purpose at least one
full New York business day preceding the additional time of purchase.
3. Representations and Warranties of the Company. The Company
represents and warrants to each of the Underwriters, as of the date hereof, as
of the time of purchase and as of any additional time of purchase, that:
(i) the Company has not received, and has no notice of, any order
of the Commission preventing or suspending the use of any
Preliminary Prospectus, or instituting proceedings for that
purpose, and each Preliminary Prospectus, at the time of filing
thereof, conformed in all material respects to the requirements
of the Act and the rules and regulations thereunder; the
Registration Statement is effective under the Act, and no stop
order suspending the effectiveness of the Registration Statement
has been issued under the Act and no proceedings for that purpose
have been initiated or are pending or threatened by the
Commission; at the time of effectiveness of the Registration
Statement and any post-effective amendment thereto, at the date
of issuance of the Prospectus and any amendment or supplement
thereto the Registration Statement and each amendment if any,
thereto and the Prospectus and each amendment or supplement, if
any, thereto fully complied, fully complies and will fully
comply, as applicable, in all material respects with the
provisions of the Act and the rules and regulations thereunder,
and at the time of effectiveness of the Registration Statement
and any post-effective amendment thereto, at the date of issuance
of the Prospectus and any amendment or supplement thereto and at
the time of purchase and any additional time of purchase, the
Registration Statement did not, does not and will not, as
applicable, include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and the
Prospectus did not, does not and will not, as applicable, include
an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not
misleading; provided, however, that the Company makes no warranty
or representation with respect to any
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statement contained in the Registration Statement or the
Prospectus in reliance upon and in conformity with information
concerning the Underwriters and furnished in writing by or on
behalf of any Underwriter through you to the Company expressly
for use in the Registration Statement or the Prospectus; the
documents incorporated by reference in the Prospectus, at the
time they were filed with the Commission, complied in all
material respects with the requirements of the Exchange Act and
the rules and regulations thereunder, and did not and do not, as
applicable, include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which
they were made, not misleading; and the Company has not
distributed any offering material in connection with the offering
or sale of the Shares other than the Registration Statement, the
Preliminary Prospectus, the Prospectus or any other materials, if
any, permitted by the Act and approved in writing by you;
(ii) all of the issued and outstanding beneficial interests in
the Company, including the Shares, have been duly and validly
authorized and issued and are fully paid and non-assessable
interests in the assets of the Company, have been issued in
compliance with all federal and state securities laws and were
not issued in violation of any preemptive right, resale right,
right of first refusal or similar right;
(iii) the Company has been duly created and is validly existing
as a business trust in good standing under the laws of the State
of Delaware, and under its trust agreement, as amended (the
"Trust Agreement"), resolutions of the board of trustees of the
Company and the Delaware Business Trust Act (the "Trust Act"),
has full trust power and authority to own, lease and operate its
properties and conduct its business as described in the
Registration Statement and Prospectus; and the Company is duly
qualified as a business trust to transact business as a foreign
entity and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result
in a material adverse change in the financial condition,
earnings, investment portfolio, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of
business ( a "Material Adverse Effect");
(iv) each of the Company's subsidiaries (the "Subsidiaries") has
been duly created and is validly existing as a business trust in
good standing under the laws of the State of Delaware, and under
their respective trust agreements and the Trust Act, has full
trust power and authority to own, lease and operate its
properties and to conduct its business as described in the
Registration Statement and Prospectus; each of the Subsidiaries
is duly qualified as a business trust to transact business as a
foreign entity and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing
would not result in a Material Adverse Effect; except as
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otherwise disclosed in the Prospectus, all of the issued and
outstanding equity interests of each Subsidiary have been duly
and validly authorized and issued and are fully paid and
non-assessable interests in the assets of such Subsidiary that
are owned by the Company, directly or through other Subsidiaries,
free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity; and none of the outstanding equity
interests of the Subsidiaries were issued in violation of any
preemptive right, resale right, right of first refusal or similar
right;
(v) the Company's Trust Agreement, has been duly authorized,
executed and delivered by the Company and constitutes a valid,
legal and binding agreement of the Company, enforceable against
the Company in accordance with its terms, except to the extent
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to
creditors' rights generally or by general principles of equity;
(vi) neither the Company nor any of its Subsidiaries is in
violation of its trust agreement (or other organizational
document) or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or other agreement or instrument to which
the Company or any of its Subsidiaries is a party or by which 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 (collectively,
"Agreements and Instruments"), except for such violations or
defaults that would not result in a Material Adverse Effect; and
the execution, delivery and performance of this Agreement, and
any other agreement or instrument entered into or issued or to be
entered into or issued by the Company in connection with the
transactions contemplated hereby or in the Registration Statement
or the Prospectus, the consummation of the transactions
contemplated herein and in the Registration Statement and the
Prospectus (including the issuance and sale of the Shares and the
use of the proceeds from the sale of the Shares as described in
the Prospectus under the caption "Use of Proceeds") and the
compliance by the Company with its obligations hereunder have
been duly authorized by all necessary trust action and do not and
will not, whether with or without the giving of notice or passage
of time or both, conflict with or constitute a breach of, or
default or a Repayment Event (as defined below) 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, the Agreements and Instruments, nor
will such action result in any violation of the provisions of the
Trust Agreement or the trust agreement (or any other
organizational document) of any of its Subsidiaries or any
applicable law, statute, rule, regulation, judgment, order, writ
or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Company or any
of its Subsidiaries or any of their property or assets; it being
understood that the term "Repayment Event" means any event or
condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such
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holder's behalf) the right to require the repurchase, redemption
or repayment of all or a portion of such indebtedness by the
Company or any of its Subsidiaries;
(vii) the Company and its Subsidiaries possess such permits,
licenses, approvals, consents and other authorizations
(collectively, "Governmental Licenses") issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them; the
Company and its Subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except where the
failure so to comply would not, singly or in the aggregate,
result in a Material Adverse Effect; all of the Governmental
Licenses are valid and in full force and effect, except where the
invalidity of Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not,
singly or in the aggregate, result in a Material Adverse Effect;
and neither the Company nor any of its Subsidiaries has received
any notice of proceedings relating to the revocation or
modification of any Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect;
(viii) this Agreement has been duly authorized, executed and
delivered by the Company and is a legal, valid and binding
agreement of the Company enforceable in accordance with its
terms, except to the extent enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to creditors' rights generally or by
general principles of equity; it being further understood that no
opinion is being expressed as to the enforceability of the
indemnification or contribution provisions contained herein.
(ix) the Trust Agreement conforms, and the beneficial interests
in the Company, including, upon issuance, the Shares, will
conform, in all material respects to the descriptions thereof
contained in the Registration Statement and the Prospectus; the
certificates for the Shares are in due and proper form; and the
holders of the Shares will be entitled to the same limitation of
personal liability as that extended to stockholders of private
corporations for profit organized under the General Corporation
Law of the State of Delaware, it being understood that a holder
of Shares may be obligated to make certain payments provided for
in the Trust Agreement and described in the Prospectus;
(x) no approval, authorization, consent or order of or filing
with any national, state or local governmental or regulatory
commission, board, body, authority or agency is required in
connection with the issuance and sale of the Shares or the
consummation by the Company of the transactions as contemplated
hereby other than registration of the Shares under the Act and
any necessary qualification under the securities or blue sky laws
of the various jurisdictions in which the Shares are being
offered by the Underwriters;
(xi) no person has the right, contractual or otherwise, to cause
the Company to issue to it, or register pursuant to the Act, any
beneficial interests in the Company upon the issue and sale of
the Shares to the Underwriters hereunder, nor does any
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person have preemptive rights, resale rights, rights of first
refusal or other similar rights to purchase any of the Shares
other than those rights that have been expressly waived, fully
and unconditionally, prior to the date hereof; it being
understood that the Company has previously issued 644,000
Convertible Community Reinvestment Act Preferred Shares
("Convertible CRA Shares") convertible into Common Shares, and
may issue up to 7,000,000 additional Convertible CRA Shares
currently being offered to qualified institutional buyers by
Meridian Investments, Inc. and may issue Common Shares upon the
exercise of outstanding options described in the Prospectus;
(xii) Deloitte & Touche LLP, whose reports on the consolidated
financial statements of the Company and its subsidiaries are
filed with the Commission as part of the Registration Statement
and the Company's annual report on Form 10-K for the fiscal year
ended December 31, 2000, are independent public accountants as
required by the Act and the rules and regulations thereunder;
(xiii) all legal or governmental proceedings, statutes,
regulations, contracts, licenses, agreements, leases or other
documents of a character required to be described in the
Registration Statement or the Prospectus or to be filed as an
exhibit to the Registration Statement have been so described or
filed as required;
(xiv) except as set forth in the Prospectus, there is no action,
suit, proceeding, inquiry or investigation before or brought 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, singly or in the aggregate, would result in a Material
Adverse Effect, or which might reasonably be expected to
materially and adversely affect the property or assets of the
Company or any of its Subsidiaries or the consummation of the
transactions contemplated herein or the performance by the
Company of its obligations hereunder;
(xv) the financial statements included in the Registration
Statement and the Prospectus present fairly the consolidated
financial position of the Company and its subsidiaries as of the
dates indicated and the consolidated results of operations and
cash flows of the Company and its subsidiaries for the periods
specified; and such financial statements have been prepared in
conformity with generally accepted accounting principles applied
on a consistent basis during the periods involved and have been
prepared in conformity with the Act and the rules and regulations
thereunder;
(xvi) subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, except
as otherwise stated therein, there has not been (i) any change
resulting in a Material Adverse Effect, (ii) any transaction
which is material to the Company or its Subsidiaries, except
transactions in the ordinary course of business, (iii) any
obligation, direct or contingent, which is material to the
Company and its Subsidiaries taken as a whole, incurred by the
Company or its subsidiaries, except obligations incurred in
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the ordinary course of business, (iv) any change in the
beneficial interests in or outstanding indebtedness of the
Company or its Subsidiaries, except changes in the ordinary
course of business or (v) except for regular quarterly dividends
on the beneficial interests in the Company in amounts per share
that are consistent with past practice, there has been no
dividend or distribution of any kind declared, paid or made on
the beneficial interests in the Company; and neither the Company
nor its Subsidiaries has any material contingent obligation which
is not disclosed in the Registration Statement and the
Prospectus;
(xvii) the Company has obtained the agreement of each of its
trustees and each employee of Related Charter LLC, the sole
general partner of Related Charter LP, at the Senior Vice
President level and above, substantially in the form set forth in
Exhibit D hereto, not to offer, sell, contract to sell, hedge, or
otherwise dispose of, directly or indirectly, any Common Shares
or securities convertible into or exchangeable for Common Shares
for a period of 90 days after the date of the Prospectus;
(xviii) the Company is not, and upon the issuance and sale of the
Shares as herein contemplated and the application of the net
proceeds therefrom as described in the Prospectus will not be, an
"investment company" or an entity "controlled" by an "investment
company", as such terms are defined in the Investment Company Act
of 1940, as amended (the "Investment Company Act");
(xix) the Company does not have any employees, although the
Company does have officers who are officers and/or employees of
Related Capital Company as described in the Prospectus;
(xx) the Company and its Subsidiaries do not own any real
property nor do they have any leases or subleases with respect to
any real property; the Company and its Subsidiaries have good and
marketable title to the investments described in the Prospectus,
in each case, free and clear of all mortgages, pledges, liens,
security interests, claims, restrictions or encumbrances of any
kind except such as (i) are described in the Prospectus or (ii)
do not, singly or in the aggregate, materially affect the value
of any such investments; and neither the Company nor any of its
Subsidiaries has any notice of any material claim of any sort
that has been asserted by anyone adverse to the rights of the
Company or any of its Subsidiaries under any of such investments,
or affecting or questioning the rights of the Company or any
Subsidiary thereof to the continued possession of the
investments;
(xxi) except as set forth in the Prospectus, to the best of the
Company's knowledge, except such matters as would not, singly or
in the aggregate, result in a Material Adverse Effect, (i) none
of the properties securing the Company's investments (the
"Securing Properties") is in violation of any federal, state,
local or foreign statute, law, rule, regulation, ordinance, code,
policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, relating to pollution or
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protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface
or subsurface strata) or wildlife, including, without limitation,
laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (ii) the Securing Properties have all
permits, authorizations and approvals required under any
applicable Environmental Laws and are each in compliance with
their requirements, (iii) there are no pending or threatened
administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or
violation, investigation or proceedings relating to any
Environmental Law against the Securing Properties and (iv) there
are no events or circumstances that might reasonably be expected
to form the basis of an order for clean-up or remediation, or an
action, suit or proceeding by any private party or governmental
body or agency, against or affecting the Securing Properties
relating to Hazardous Materials or Environmental Laws; and
(xxii) the Company has been and is properly treated as a
partnership, and not as a publicly traded partnership taxable as
a corporation or as an association taxable as a corporation for
federal income tax purposes, and the holders of the Shares will
be treated as partners for U.S. federal income tax purposes.
4. Certain Covenants of the Company. The Company hereby agrees:
(a) to furnish such information as may be required and otherwise
to cooperate with you in taking any required actions to qualify, on the
Company's behalf, the Shares for offering and sale under the securities
or blue sky laws of such states as you may designate and to maintain such
qualifications in effect so long as required for the distribution of the
Shares; provided that the Company shall not be required to qualify as a
foreign corporation or to consent to the service of process under the
laws of any such state (except service of process with respect to the
offering and sale of the Shares); and to promptly advise you of the
receipt by the Company of any notification with respect to the suspension
of the qualification of the Shares for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose;
(b) to make available to the Underwriters in New York City, from
time to time, as many copies of the Prospectus (or of the Prospectus as
amended or supplemented if the Company shall have made any amendments or
supplements thereto) as the Underwriters may request for the purposes
contemplated by the Act; and to prepare promptly upon request, in case
where any Underwriter is required to deliver a prospectus in connection
with the sale of the Shares, such amendment(s) or supplement(s) to the
Registration Statement and such prospectuses as may be necessary to
permit compliance with the requirements of Section 10(a)(3) of the Act;
9
(c) to advise you promptly and (if requested by you) to confirm
such advice in writing, when (i) any post effective amendment to the
Registration Statement becomes effective and (ii) the Prospectus is filed
with the Commission pursuant to Rule 424(b) under the Act (which the
Company agrees to file in a timely manner under the Act);
(d) to advise you promptly and (if requested by you) to confirm
such advice in writing, of any request by the Commission for amendments
or supplements to the Registration Statement or Prospectus or for
additional information with respect thereto, or of notice of institution
of proceedings for, or the entry of a stop order suspending the
effectiveness of the Registration Statement and, if the Commission should
enter a stop order suspending the effectiveness of the Registration
Statement, to make every reasonable effort to obtain the lifting or
removal of such order as soon as possible; and to advise you promptly of
any proposal to amend or supplement the Registration Statement or
Prospectus, including by filing any documents that would be incorporated
therein by reference, and not to file or use any such amendment or
supplement to which you shall reasonably object in writing;
(e) to file promptly, subject to the limitations specified in
clause (d) above, all reports and any definitive proxy or information
statement required to be filed by the Company with the Commission in
order to comply with the Exchange Act and the rules and regulations
thereunder subsequent to the date of the Prospectus and for so long as
the delivery of a prospectus is required in connection with the offering
or sale of the Shares;
(f) if necessary or appropriate, to file a Rule 462(b)
Registration Statement;
(g) to the extent unavailable on open-access public filing
retrieval systems, furnish to you and, upon request, to each of the other
Underwriters for a period of five years from the date of this Agreement
(i) copies of any reports or other communications which the Company shall
send to its common shareholders or shall from time to time publish or
publicly disseminate, (ii) copies of all annual, quarterly and current
reports filed with the Commission on Forms 10-K, 10-Q and 8-K, or such
other similar form as may be designated by the Commission, (iii) copies
of documents or reports filed with any national securities exchange on
which any class of securities of the Company is listed, and (iv) such
other information as you may reasonably request regarding the Company or
its Subsidiaries, in each case as soon as such communications, documents
or information becomes available;
(h) to advise the Underwriters promptly of the happening of any
event known to the Company within the time during which a prospectus
relating to the Shares is required to be delivered under the Act which,
in the judgment of the Company, would require the making of any change in
the Prospectus (as then amended or supplemented in accordance with this
Agreement), or in the information incorporated therein by reference, so
that such Prospectus would not include an untrue statement of 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
are made, not misleading; and, during such time, subject to the
limitations in clause (d) above, to prepare and furnish, at the Company's
expense, to the Underwriters promptly such amendment(s) or supplement(s)
to such Prospectus as
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may be necessary to reflect any such change and to furnish you a copy of
each such proposed amendment or supplement before filing any such
amendment or supplement with the Commission;
(i) to make generally available to its security holders, and to
deliver to you (to the extent unavailable on open-access public filing
retrieval systems), an earnings statement of the Company (which will
satisfy the provisions of Section 11(a) of the Act) covering a period of
twelve months beginning after the effective date of the Registration
Statement (as defined in Rule 158(c) of the Act) as soon as is reasonably
practicable after the termination of such twelve-month period but not
later than August 15, 2002;
(j) to furnish to its shareholders as soon as practicable after
the end of each fiscal year an annual report (including a balance sheet
and statements of income, shareholders' equity and of cash flow of the
Company for such fiscal year), accompanied by a copy of the certificate
or report thereon of nationally recognized independent certified public
accountants;
(k) to furnish to you, upon request, five signed copies of the
Registration Statement, as initially filed with the Commission, and of
all amendments thereto (including all exhibits thereto and documents
incorporated by reference therein) and sufficient conformed copies of the
foregoing (other than exhibits) for distribution of a copy to each of the
other Underwriters;
(l) to the extent unavailable on open-access public filing
retrieval systems, furnish to you as early as practicable prior to the
time of purchase and the additional time of purchase, as the case may be,
but not later than two New York business days prior thereto, a copy of
the latest available unaudited interim consolidated financial statements,
if any, of the Company and its subsidiaries which have been read by the
Company's independent certified public accountants, as stated in their
letter to be furnished pursuant to Section 6(c) hereof;
(m) to apply the net proceeds from the sale of the Shares in the
manner set forth under the caption "Use of Proceeds" in the Prospectus;
(n) to comply with all the provisions of any undertakings
contained in the Registration Statement;
(o) to pay all costs, expenses, fees and taxes (other than any
transfer taxes and fees and disbursements of counsel for the Underwriters
except as set forth under Section 5 hereof and (iii), (iv) and (vi)
below) in connection with (i) the preparation and filing of the
Registration Statement, each Preliminary Prospectus, the Prospectus, and
any amendments or supplements thereto, and the printing and furnishing of
copies of each thereof to the Underwriters and to dealers (including
costs of mailing and shipment), (ii) the registration, issue, sale and
delivery of the Shares, (iii) the producing, word processing and/or
printing of this Agreement, any Agreement Among Underwriters, any dealer
agreements, any Powers of Attorney and any closing documents (including
compilations thereof) and the reproduction and/or printing and furnishing
of copies of
11
each thereof to the Underwriters and (except closing documents) to
dealers (including costs of mailing and shipment), (iv) the qualification
of the Shares for offering and sale under state laws and the
determination of their eligibility for investment under state law as
aforesaid (including the reasonable legal fees, if any and filing fees
and other disbursements of counsel for the Underwriters) and the
furnishing of copies of any blue sky surveys or legal investment surveys
to the Underwriters and to dealers, (v) the listing of the Shares on the
American Stock Exchange ("AMEX") and any registration thereof under the
Exchange Act, (vi) any filing for review of the public offering of the
Shares by the National Association of Securities Dealers, Inc., if any
and (vii) the performance of the Company's other obligations hereunder;
(p) to furnish to you, before filing with the Commission,
subsequent to the effective date of the Registration Statement and during
the period referred to in paragraph (e) above, a copy of any document
proposed to be filed pursuant to Section 13, 14 or 15(d) of the Exchange
Act and will not file any such document in a form in which the
Underwriters shall object;
(q) not to offer, sell, contract to sell, hedge or otherwise
dispose of, directly or indirectly, any Common Shares or securities
convertible into or exchangeable for Common Shares, except for sale of
the Shares to the Underwriters pursuant to this Agreement, any issuances
of Common Shares upon the exercise of outstanding options described in
the Prospectus and the 7,000,000 Convertible CRA Shares currently being
offered to qualified institutional buyers on a best efforts basis by
Meridian Investments, Inc., for a period of 90 days after the date
hereof, without your prior written consent;
(r) that it will not at any time, directly or indirectly, take
any action intended, or which might reasonably be expected, to cause or
result in, or which will constitute, stabilization of the price of the
Common Shares to facilitate the sale or resales of the Shares;
(s) to continue to operate its business so as to properly be
treated as a partnership, and not as a publicly traded partnership
taxable as a corporation or as an association taxable as a corporation,
for federal income tax purposes and at least 90% of its gross income each
taxable year will be qualifying income for purposes of Section 7704(c) of
the Internal Revenue Code of 1986, as amended (the "Code") (i.e., less
than 10% of its gross income will be derived from a financial business,
an insurance business, or acting as a dealer), throughout the life of the
Company; and
(t) to use its best efforts to cause the Shares to be listed and
to maintain the listing of all of the Common Shares, including the
Shares, on the AMEX.
5. Reimbursement of Underwriters' Expenses. If the Shares are not
delivered for any reason other than the termination of this Agreement pursuant
to the second paragraph of Section 7 hereof or the default by one or more of the
Underwriters in its or their respective obligations hereunder, the Company
shall, in addition to paying the amounts described in Section 4(o) hereof,
reimburse the Underwriters for all of their out-of-pocket expenses, including
the fees and disbursements of their counsel.
12
6. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters hereunder are subject to the accuracy of the
representations and warranties on the part of the Company on the date hereof and
at the time of purchase (and the several obligations of the Underwriters at the
additional time of purchase are subject to the accuracy of the representations
and warranties on the part of the Company on the date hereof and at the time of
purchase (unless previously waived) and at the additional time of purchase, as
the case may be), the performance by the Company of its obligations hereunder
and to the following additional conditions precedent:
(a) The Company shall furnish to you at the time of purchase and
at the additional time of purchase, as the case may be, favorable
opinions of Xxxx, Xxxxxxxx, Xxxxxxxx & Xxxxxx LLP, Xxxxxxxxx Xxxxxxx LLP
and Xxxxxxxx, Xxxxxx & Xxxxxx, P.A. counsel for the Company, in form and
substance reasonably satisfactory to the Underwriters, together with
signed or reproduced copies of such letters for each of the other
Underwriters, to the effect set forth in Exhibits A, B and C,
respectively, hereto.
(b) The Company shall furnish to you at the time of purchase and
at the additional time of purchase, as the case may be, the favorable
opinion of Xxxx, Hastings, Xxxxxxxx & Xxxxxx LLP, counsel for the
Company, in form and substance reasonably satisfactory to the
Underwriters, to the effect that based on representations of the Company
as to its activities and certain assumptions as to the validity and
enforceability of the Company's organizational documents and certain
future actions of the Company, although the issue is not free from doubt,
the Company has been, since its creation in October 1997, and is,
properly treated as a partnership for federal income tax purposes and
that the information in the Prospectus under "Risk Factors--Publicly
traded partnership status," and "Federal Income Tax Considerations" to
the extent that it constitutes matters of law, summaries of legal
matters, the Trust Agreement, legal proceedings, or legal conclusions,
has been reviewed by them and is correct in all material respects.
(c) You shall have received from Deloitte & Touche LLP, letters
dated, respectively, the date of this Agreement and the time of purchase
and additional time of purchase, as the case may be, and addressed to the
Underwriters (with reproduced copies for each of the Underwriters) in the
forms heretofore approved by you.
(d) At the time of purchase and at the additional time of
purchase, as the case may be, the Underwriters shall have received the
favorable opinion, dated at the time of purchase or the additional time
of purchase, as the case may be, of Xxxxxx Xxxxxx Xxxxx & Xxxx LLP,
counsel for the Underwriters, together with signed or reproduced copies
of such letter for each of the other Underwriters, in form and substance
reasonably satisfactory to the Underwriters. In giving such opinion such
counsel may rely, as to all matters governed by the laws of jurisdictions
other than the law of the State of New York and the federal law of the
United States, upon the opinions of counsel reasonably satisfactory to
the Underwriters. Such counsel may also state that, insofar as such
opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and its
subsidiaries and certificates of public officials.
13
In addition, such counsel shall state that such counsel have
participated in conferences with officers and other representatives of
the Company, counsel for the Company, representatives of the independent
public accountants of the Company and representatives of the
Underwriters at which the contents of the Registration Statement and
Prospectus and related matters were discussed and, although such counsel
is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement and Prospectus (except as to matters referred to
with respect to the Shares under subparagraph (xiii) of Exhibit A), on
the basis of the foregoing (relying as to materiality to a large extent
upon the opinions of officers and other representatives of the Company),
no facts have come to the attention of such counsel which lead them to
believe that the Registration Statement or any amendment thereto, at the
time such Registration Statement or amendment became effective or at the
date of this Agreement, contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or that the
Prospectus or any amendment or supplement thereto, as of the date the
Prospectus was first issued to the Underwriters, as of the date of any
amendment or supplement to the Prospectus or at the time of purchase or
any additional time of purchase, included or includes an untrue
statement of a material fact or omitted or omits to state a material
fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading (it being
understood that such counsel need express no comment with respect to the
financial statements and schedules and other financial or statistical
data included in the Registration Statement or Prospectus).
(e) No amendment or supplement to the Registration Statement or
Prospectus, including documents deemed to be incorporated by reference
therein, shall be filed after the execution and delivery of this
Agreement to which you reasonably object in writing.
(f) The Prospectus shall have been filed with the Commission
under and in accordance with Rule 424(b) under the Act.
(g) At or prior to the time of purchase or the additional time of
purchase, as the case may be, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under
the Act or proceedings initiated under Section 8(d) or 8(e) of the Act;
(ii) the Registration Statement and all amendments thereto, or
modifications thereof, if any, shall 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; and
(iii) the Prospectus and all amendments or supplements thereto, or
modifications thereof, if any, shall 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 are made, not misleading.
(h) Between the time of execution and delivery of this Agreement
and the time of purchase or the additional time of purchase, as the case
may be, (i) there shall not have been any change that has resulted in a
Material Adverse Effect and (ii) no transaction
14
which is material and unfavorable to the Company shall have been entered
into by the Company or any of its Subsidiaries.
(i) The Company will, at the time of purchase or additional time
of purchase, as the case may be, deliver to you a certificate of one of
its managing trustees and the principal accounting officer to the effect
that the representations and warranties of the Company as set forth in
this Agreement are true and correct as of each such date, that the
Company has performed all of its obligations under this Agreement
required to be performed at or before the time of purchase and at or
before the additional time of purchase, as the case may be and the
conditions set forth in paragraphs (g) and (h) of this Section 6 have
been met.
(j) You shall have received signed letters, dated the date of
this Agreement, from each of the Company's trustees and each employee of
Related Charter LLC, the sole general partner of Related Charter LP, at
the Senior Vice President level and above, substantially in the form set
forth in Exhibit D hereto, agreeing not to offer, sell, contract to sell,
hedge, or otherwise dispose of, directly or indirectly, any Common Shares
or securities convertible into or exchangeable for Common Shares for a
period of 90 days after the date of the Prospectus.
(k) The Company shall have furnished to you such other documents
and certificates as to the accuracy and completeness of any statement in
the Registration Statement and the Prospectus as of the time of purchase
and the additional time of purchase, as the case may be, as you may
reasonably request.
(l) The Shares shall have been approved for listing on the AMEX,
subject only to notice of issuance at or prior to the time of purchase or
the additional time of purchase, as the case may be.
7. Effective Date of Agreement; Termination. This Agreement shall
become effective when the parties hereto have executed and delivered this
Agreement.
The obligations of the several Underwriters hereunder shall be
subject to termination in the absolute discretion of you or any group of
Underwriters (which may include you) which has agreed to purchase in the
aggregate at least 50% of the Firm Shares, if, since the time of execution and
delivery of this Agreement or the respective dates as of which information is
given in the Registration Statement and Prospectus, (i) there has been any
material adverse and unfavorable change, financial or otherwise (other than as
referred to in the Registration Statement and Prospectus as of the date hereof),
in the operations, business, condition or prospects of the Company and its
subsidiaries taken as a whole, which would, in your judgment or in the judgment
of such group of Underwriters, make it impracticable to market the Shares, or,
(ii) at any time prior to the time of purchase or, with respect to the purchase
of any Additional Shares, the additional time of purchase, as the case may be,
trading in securities on the New York Stock Exchange, the AMEX or the Nasdaq
National Market shall have been suspended or limitations or minimum prices shall
have been established on the New York Stock Exchange, the AMEX or the Nasdaq
National Market, or (iii) a banking moratorium shall have been declared either
by the United States or New York State authorities, or (iv) the United States
shall have
15
declared war in accordance with its constitutional processes or there shall have
occurred any material outbreak or escalation of hostilities or other national or
international calamity or crisis of such magnitude in its effect on the
financial markets of the United States as, in your judgment or in the judgment
of such group of Underwriters, to make it impracticable to market the Shares.
If you or any group of Underwriters elects to terminate this
Agreement as provided in this Section 7, the Company and each other Underwriter
shall be notified promptly by letter or telegram.
If the sale to the Underwriters of the Shares, as contemplated by
this Agreement, is not carried out by the Underwriters for any reason permitted
under this Agreement or if such sale is not carried out because the Company
shall be unable to comply with any of the terms of this Agreement, the Company
shall not be under any obligation or liability under this Agreement (except to
the extent provided in Sections 4(o), 5 and 9 hereof), and the Underwriters
shall be under no obligation or liability to the Company under this Agreement
(except to the extent provided in Section 9 hereof) or to one another hereunder.
8. Increase in Underwriters' Commitments. Subject to Sections 6
and 7, if any Underwriter shall default in its obligation to take up and pay for
the Firm Shares to be purchased by it hereunder (otherwise than for a reason
sufficient to justify the termination of this Agreement under the provisions of
Section 7 hereof) and if the number of Firm Shares which all Underwriters so
defaulting shall have agreed but failed to take up and pay for does not exceed
10% of the total number of Firm Shares, the non-defaulting Underwriters shall
take up and pay for (in addition to the aggregate number of Firm Shares they are
obligated to purchase pursuant to Section 1 hereof) the number of Firm Shares
agreed to be purchased by all such defaulting Underwriters, as hereinafter
provided. Such Shares shall be taken up and paid for by such non-defaulting
Underwriter or Underwriters in such amount or amounts as you may designate with
the consent of each Underwriter so designated or, in the event no such
designation is made, such Shares shall be taken up and paid for by all
non-defaulting Underwriters pro rata in proportion to the aggregate number of
Firm Shares set opposite the names of such non-defaulting Underwriters in
Schedule A.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that it will
not sell any Firm Shares hereunder unless all of the Firm Shares are purchased
by the Underwriters (or by substituted Underwriters selected by you with the
approval of the Company or selected by the Company with your approval).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Company or you shall have the right
to postpone the time of purchase for a period not exceeding five business days
in order that any necessary changes in the Registration Statement and Prospectus
and other documents may be effected.
The term Underwriter as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 8 with like effect as if
such substituted Underwriter had originally been named in Schedule A.
16
If the aggregate number of Shares which the defaulting
Underwriter or Underwriters agreed to purchase exceeds 10% of the total number
of Shares which all Underwriters agreed to purchase hereunder, and if neither
the non-defaulting Underwriters nor the Company shall make arrangements within
the five business day period stated above for the purchase of all the Shares
which the defaulting Underwriter or Underwriters agreed to purchase hereunder,
this Agreement shall be terminated without further act or deed and without any
liability on the part of the Company to any non-defaulting Underwriter and
without any liability on the part of any non-defaulting Underwriter to the
Company. Nothing in this paragraph, and no action taken hereunder, shall relieve
any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
9. Indemnity and Contribution.
(a) The Company agrees to indemnify, defend and hold harmless
each Underwriter, its partners, directors and officers, and any person who
controls any Underwriter within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, and the successors and assigns of all of the foregoing
persons from and against any loss, damage, expense, liability or claim
(including the reasonable cost of investigation) which, jointly or severally,
any such Underwriter or any such person may incur under the Act, the Exchange
Act, the common law or otherwise, insofar as such loss, damage, expense,
liability or claim arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement (or in the Registration Statement as amended by any post-effective
amendment thereof by the Company) or in a Prospectus (the term Prospectus for
the purpose of this Section 9 being deemed to include any Preliminary
Prospectus, the Prospectus and the Prospectus as amended or supplemented by the
Company), or arises out of or is based upon any omission or alleged omission to
state a material fact required to be stated in either such Registration
Statement or Prospectus or necessary to make the statements made therein not
misleading, except insofar as any such loss, damage, expense, liability or claim
arises out of or is based upon any untrue statement or alleged untrue statement
of a material fact contained in and in conformity with information furnished in
writing by or on behalf of any Underwriter through you to the Company expressly
for use with reference to such Underwriter in such Registration Statement or
such Prospectus or arises out of or is based upon any omission or alleged
omission to state a material fact in connection with such information required
to be stated in such Registration Statement or such Prospectus or necessary to
make such information not misleading.
If any action, suit or proceeding (together, a "Proceeding") is
brought against an Underwriter or any such person in respect of which indemnity
may be sought against the Company pursuant to the foregoing paragraph, such
Underwriter or such person shall promptly notify the Company in writing of the
institution of such Proceeding and the Company shall assume the defense of such
Proceeding, including the employment of counsel reasonably satisfactory to such
indemnified party and payment of all fees and expenses; provided, however, that
the omission to so notify the Company shall not relieve the Company from any
liability which the Company may have to any Underwriter or any such person or
otherwise. Such Underwriter or such person shall have the right to employ its or
their own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of such Underwriter or of such person unless the
employment of such counsel shall have been authorized in writing by the
17
Company in connection with the defense of such Proceeding or the Company shall
not have, within a reasonable period of time in light of the circumstances,
employed counsel to have charge of the defense of such Proceeding or such
indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from, additional to or in
conflict with those available to the Company (in which case the Company shall
not have the right to direct the defense of such Proceeding on behalf of the
indemnified party or parties), in any of which events such fees and expenses
shall be borne by the Company and paid as incurred (it being understood,
however, that the Company shall not be liable for the expenses of more than one
separate counsel (in addition to any local counsel) in any one Proceeding or
series of related Proceedings in the same jurisdiction representing the
indemnified parties who are parties to such Proceeding). The Company shall not
be liable for any settlement of any Proceeding effected without its written
consent but if settled with the written consent of the Company, the Company
agrees to indemnify and hold harmless any Underwriter and any such person from
and against any loss or liability by reason of such settlement. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by the second sentence of this paragraph, then the
indemnifying party agrees that it shall be liable for any settlement of any
Proceeding effected without its written consent if (i) such settlement is
entered into more than 60 business days after receipt by such indemnifying party
of the aforesaid request, (ii) such indemnifying party shall not have reimbursed
the indemnified party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the indemnifying
party at least 30 days' prior notice of its intention to settle. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened Proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such Proceeding and does not include an admission
of fault, culpability or a failure to act, by or on behalf of such indemnified
party.
(b) Each Underwriter severally agrees to indemnify, defend and
hold harmless the Company, its trustees and officers signing the Registration
Statement, and any person who controls the Company within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, and the successors and assigns
of all of the foregoing persons from and against any loss, damage, expense,
liability or claim (including the reasonable cost of investigation) which,
jointly or severally, the Company or any such person may incur under the Act,
the Exchange Act, the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon any untrue statement
or alleged untrue statement of a material fact contained in and in conformity
with information furnished in writing by or on behalf of such Underwriter
through you to the Company expressly for use with reference to such Underwriter
in the Registration Statement (or in the Registration Statement as amended by
any post-effective amendment thereof by the Company) or in a Prospectus, or
arises out of or is based upon any omission or alleged omission to state a
material fact in connection with such information required to be stated in such
Registration Statement or such Prospectus or necessary to make such information
not misleading.
If any Proceeding is brought against the Company or any such
person in respect of which indemnity may be sought against any Underwriter
pursuant to the foregoing paragraph,
18
the Company or such person shall promptly notify such Underwriter in writing of
the institution of such Proceeding and such Underwriter shall assume the defense
of such Proceeding, including the employment of counsel reasonably satisfactory
to such indemnified party and payment of all fees and expenses; provided,
however, that the omission to so notify such Underwriter shall not relieve such
Underwriter from any liability which such Underwriter may have to the Company or
any such person or otherwise. The Company or such person shall have the right to
employ its own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of the Company or such person unless the
employment of such counsel shall have been authorized in writing by such
Underwriter in connection with the defense of such Proceeding or such
Underwriter shall not have, within a reasonable period of time in light of the
circumstances, employed counsel to have charge of the defense of such Proceeding
or such indemnified party or parties shall have reasonably concluded that there
may be defenses available to it or them which are different from or additional
to or in conflict with those available to such Underwriter (in which case such
Underwriter shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties, but such Underwriter may employ
counsel and participate in the defense thereof but the fees and expenses of such
counsel shall be at the expense of such Underwriter), in any of which events
such fees and expenses shall be borne by such Underwriter and paid as incurred
(it being understood, however, that such Underwriter shall not be liable for the
expenses of more than one separate counsel (in addition to any local counsel) in
any one Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such Proceeding). No
Underwriter shall be liable for any settlement of any such Proceeding effected
without the written consent of such Underwriter but if settled with the written
consent of such Underwriter, such Underwriter agrees to indemnify and hold
harmless the Company and any such person from and against any loss or liability
by reason of such settlement. Notwithstanding the foregoing sentence, if at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second sentence of this paragraph, then the indemnifying party agrees
that it shall be liable for any settlement of any Proceeding effected without
its written consent if (i) such settlement is entered into more than 60 business
days after receipt by such indemnifying party of the aforesaid request, (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement and (iii) such
indemnified party shall have given the indemnifying party at least 30 days'
prior notice of its intention to settle. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement of any
pending or threatened Proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such Proceeding and does not include an admission of fault, culpability or a
failure to act, by or on behalf of such indemnified party.
(c) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under subsections (a) and (b) of this
Section 9 in respect of any losses, damages, expenses, liabilities or claims
referred to therein, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, damages, expenses,
liabilities or claims (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
on the other hand from the offering of the
19
Shares or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and of the Underwriters on the other in connection
with the statements or omissions which resulted in such losses, damages,
expenses, liabilities or claims, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same respective
proportions as the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the Company
and the total underwriting discounts and commissions received by the
Underwriters, bear to the aggregate public offering price of the Shares. The
relative fault of the Company on the one hand and of the Underwriters on the
other shall be determined by reference to, among other things, whether the
untrue statement or alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The amount
paid or payable by a party as a result of the losses, damages, expenses,
liabilities and claims referred to in this subsection shall be deemed to include
any legal or other fees or expenses reasonably incurred by such party in
connection with investigating, preparing to defend or defending any Proceeding.
(d) The Company and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 9 were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in subsection (c) above.
Notwithstanding the provisions of this Section 9, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by such Underwriter and distributed to
the public were offered to the public exceeds the amount of any damage which
such Underwriter has otherwise been required to pay by reason of such untrue
statement or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section 9 are several in proportion to their respective
underwriting commitments and not joint.
(e) The indemnity and contribution agreements contained in this
Section 9 and the covenants, warranties and representations of the Company
contained in this Agreement shall remain in full force and effect regardless of
any investigation made by or on behalf of any Underwriter, its partners,
directors or officers or any person (including each partner, officer or director
of such person) who controls any Underwriter within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act, or by or on behalf of the Company,
its trustees or officers signing the Registration Statement or any person who
controls the Company within the meaning of Section 15 of the Act or Section 20
of the Exchange Act, and shall survive any termination of this Agreement or the
issuance and delivery of the Shares. The Company and each Underwriter agree
promptly to notify each other of the commencement of any Proceeding against it
and, in the case of the Company, against any of the Company's officers or
trustees in connection with the issuance and sale of the Shares, or in
connection with the Registration Statement or Prospectus.
20
10. Notices. Except as otherwise herein provided, all statements,
requests, notices and agreements shall be in writing or by telegram and, if to
the Underwriters, shall be sufficient in all respects if delivered or sent to
UBS Warburg LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, X.X. 10171-0026, Attention:
Syndicate Department and, if to the Company, shall be sufficient in all respects
if delivered or sent to the Company at the offices of the Company at 000 Xxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx X. Xxxxxx.
11. Governing Law; Construction. This Agreement and any claim,
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of New
York. The Section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
12. Submission to Jurisdiction. Except as set forth below, no
Claim may be commenced, prosecuted or continued in any court other than the
courts of the State of New York located in the City and County of New York or in
the United States District Court for the Southern District of New York, which
courts shall have jurisdiction over the adjudication of such matters, and the
parties hereto consent to the jurisdiction of such courts and personal service
with respect thereto. The parties hereto consent to personal jurisdiction,
service and venue in any court in which any Claim arising out of or in any way
relating to this Agreement is brought by any third party against you or any
indemnified party. You and the Company (on its behalf and, to the extent
permitted by applicable law, on behalf of its common shareholders and
affiliates) waives all right to trial by jury in any action, proceeding or
counterclaim (whether based upon contract, tort or otherwise) in any way arising
out of or relating to this Agreement. The parties hereto agree that a final
judgment in any such action, proceeding or counterclaim brought in any such
court shall be conclusive and binding upon the parties and may be enforced in
any other courts in the jurisdiction of which the parties is or may be subject,
by suit upon such judgment.
13. Parties at Interest. The Agreement herein set forth has been
and is made solely for the benefit of the Underwriters and the Company and to
the extent provided in Section 9 hereof the controlling persons, trustees,
directors and officers referred to in such section, and their respective
successors, assigns, heirs, personal representatives and executors and
administrators. No other person, partnership, association or corporation
(including a purchaser, as such purchaser, from any of the Underwriters) shall
acquire or have any right under or by virtue of this Agreement.
14. Counterparts. This Agreement may be signed by the parties in
one or more counterparts which together shall constitute one and the same
agreement among the parties.
15. Successors and Assigns. This Agreement shall be binding upon
the Underwriters and the Company and their successors and assigns and any
successor or assign of any substantial portion of the Company's and any of the
Underwriters' respective businesses and/or assets.
16. Miscellaneous.
21
(a) UBS Warburg LLC, an indirect, wholly owned subsidiary of UBS
AG, is not a bank and is separate from any affiliated bank, including any
U.S. branch or agency of UBS AG. Because UBS Warburg LLC is a separately
incorporated entity, it is solely responsible for its own contractual
obligations and commitments, including obligations with respect to sales
and purchases of securities. Securities sold, offered or recommended by
UBS Warburg LLC are not deposits, are not insured by the Federal Deposit
Insurance Corporation, are not guaranteed by a branch or agency, and are
not otherwise an obligation or responsibility of a branch or agency.
(b) A lending affiliate of UBS Warburg LLC may have lending
relationships with issuers of securities underwritten or privately placed
by UBS Warburg LLC. To the extent required under the securities laws,
prospectuses and other disclosure documents for securities underwritten
or privately placed by UBS Warburg LLC will disclose the existence of any
such lending relationships and whether the proceeds of the issue will be
used to repay debts owed to affiliates of UBS Warburg LLC.
22
If the foregoing correctly sets forth the understanding among the
Company and the Underwriters, please so indicate in the space provided below for
the purpose, whereupon this letter and your acceptance shall constitute a
binding agreement among the Company and the Underwriters, severally.
Very truly yours,
CHARTER MUNICIPAL MORTGAGE
ACCEPTANCE COMPANY
By:
--------------------------------------
Xxxxxx X. Xxxxxx
Authorized Representative of the Pricing
Committee
Accepted and agreed to as of the
date first above written, on
behalf of themselves
and the other several Underwriters
named in Schedule A
UBS WARBURG LLC
as Representative of the several Underwriters
By: UBS WARBURG LLC
By: __________________________
Name:
Title:
23
SCHEDULE A
Number of
Underwriter Firm Shares
----------- -----------
UBS WARBURG LLC......................................... 3,750,000
FIRST UNION SECURITIES, INC............................. 1,875,000
XXXX XXXXX XXXX XXXXXX, INCORPORATED.................... 1,875,000
XXXXXX XXXXXXX INCORPORATED............................. 400,000
---------
Total...................................... 7,900,000
=========
24
Exhibit A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 6(a)
(i) The Registration Statement, has been declared effective under the Act;
any required filing of the Prospectus pursuant to Rule 424(b) has been
made in the manner and within the time period required by Rule 424(b);
and , to the best of our knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued under the
Act and no proceedings for that purpose have been instituted or are
pending or threatened by the Commission.
(ii) The Registration Statement, the Prospectus, excluding the documents
incorporated by reference therein, and each amendment or supplement to
the Registration Statement and Prospectus, excluding the documents
incorporated by reference therein, as of their respective effective or
issue dates (other than the financial statements and supporting
schedules included therein or omitted therefrom, as to which we need
express no opinion) complied as to form in all material respects with
the requirements of the Act and the Exchange Act.
(iii) The documents incorporated by reference in the Prospectus (other than
the financial statements and supporting schedules included therein or
omitted therefrom, as to which we need express no opinion), at the time
they were filed with the Commission, complied as to form in all material
respects with the requirements of the Exchange Act and the rules and
regulations thereunder.
(iv) All of the issued and outstanding beneficial interests in the Company,
including the Shares, have been issued in compliance with all federal
and state securities laws and to the best of our knowledge were not
issued in violation of any preemptive right, resale right, right of
first refusal or similar right.
(v) The Company is duly qualified as a business trust to transact business
as a foreign entity and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the ownership
or leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a
Material Adverse Effect.
(vi) The authorized, issued and outstanding beneficial interests in the
Company are as set forth in the Registration Statement and Prospectus.
To the best of our knowledge, no person has the right, contractual or
otherwise, to cause the Company to issue to it, or register pursuant to
the Act, any beneficial interests in the Company upon the issue and sale
of the Shares to the Underwriters pursuant to the Agreement, nor, to the
best of our knowledge, does any person have preemptive rights, resale
rights, rights of first refusal or other similar rights to purchase any
of the Shares other than those rights that have been expressly waived,
fully and unconditionally, prior to the date of the Agreement; it being
understood that the Company has previously issued 644,000 Convertible
Community
A-1
Reinvestment Act Preferred Shares ("Convertible CRA Shares") convertible
into Common Shares, and may issue Common Shares upon the exercise of
outstanding options described in the Prospectus.
(vii) Each of the Subsidiaries is duly qualified as a business trust to
transact business as a foreign entity and is in good standing in each
jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would
not result in a Material Adverse Effect.
(viii) The Agreement has been duly executed and delivered by the Company,
constitutes a valid, legal and binding agreement of the Company, and is
enforceable against the Company in accordance with its terms except to
the extent enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to creditors'
rights generally or by general principles of equity; it being understood
that no opinion is being expressed as to the enforceability of the
indemnification or contribution provisions contained therein.
(ix) The Trust Agreement conforms, and the beneficial interests in the
Company, including, upon issuance, the Shares, will conform in all
material respects to the descriptions thereof contained in the
Registration Statement and the Prospectus.
(x) No approval, authorization, consent or order of or filing with any
national, state or local governmental or regulatory commission, board,
body, authority or agency is required in connection with the issuance
and sale of the Shares or the consummation by the Company of the
transactions as contemplated hereby other than registration of the
Shares under the Act and any necessary qualification under the
securities or blue sky laws of the various jurisdictions in which the
Shares are being offered by the Underwriters.
(xi) To the best of our knowledge, there is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending or threatened against
or affecting the Company or any of its Subsidiaries which, singly or in
the aggregate, would result in a Material Adverse Effect, or which might
reasonably be expected to materially and adversely affect the property
or assets of the Company or any of its Subsidiaries or the consummation
of the transactions contemplated by the Agreement or the performance by
the Company of its obligations under the Agreement.
(xii) All descriptions in the Registration Statement and Prospectus of
contracts and other documents to which the Company or any of its
Subsidiaries are a party are accurate in all material respects.
(xiii) All legal or governmental proceedings, statutes, regulations, contracts,
licenses, agreements, leases or other documents of a character required
to be described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement have been so described
or filed as required.
A-2
(xiv) To the best of our knowledge, (i) neither the Company nor any of its
Subsidiaries is in violation of its Trust Agreement or other
organizational documents and (ii) no default by the Company or any of
its Subsidiaries exists in the due performance or observance of any
material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument that is described or referred to in the
Prospectus. The execution, delivery and performance of the Agreement,
and any other agreement or instrument entered into or issued or to be
entered into or issued by the Company in connection with the
transactions contemplated by the Agreement or in the Registration
Statement or the Prospectus, the consummation of the transactions
contemplated by the Agreement and in the Registration Statement and the
Prospectus (including the issuance and sale of the Shares and the use of
the proceeds from the sale of the Shares as described in the Prospectus
under the caption "Use of Proceeds") and the compliance by the Company
with its obligations under the Agreement have been duly authorized by
all necessary trust action and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict with
or constitute a breach of, or default or a Repayment Event (as defined
in Section 3(6) of the Agreement) 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, deed of trust, loan or credit agreement,
note, lease or any other agreement or instrument, known to us, to which
the Company or any Subsidiary 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 subsidiary is subject (except for such conflicts, breaches or
defaults or liens, charges or encumbrances that would not have a
Material Adverse Effect), nor will such action result in any violation
of the provisions of the Trust Agreement or the trust agreement (or any
other organizational document) of any of its Subsidiaries or any
applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government instrumentality or court, domestic
or foreign, having jurisdiction over the Company or any of its
Subsidiaries or any of their property or assets.
(xv) The Company is not, and solely as a result of the consummation of the
transactions contemplated by the Prospectus and the Agreement, will not
become, an "investment company" or an entity "controlled" by an
"investment company", as such terms are defined in the Investment
Company Act.
Nothing has come to our attention that would lead us to believe that the
Registration Statement or any amendment thereto (except for financial statements
and schedules and other financial data included or incorporated by reference
therein or omitted therefrom, as to which we need make no statement), at the
time such Registration Statement or amendment became effective, contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading
or that the Prospectus or any supplement thereto (except for financial
statements and schedules and other financial data included or incorporated by
reference therein or omitted therefrom, as to which we need make no statement),
at the date of such Prospectus or such supplement, and at all times up to and
including the time of purchase or additional time of purchase, as the case may
be, contained an untrue statement of a material fact or omitted to state a
material fact required to be
A-3
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
A-4
Exhibit B
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 6(a)
The discussion set forth in the Prospectus under the heading
"Risk Factors - The value of our common shares, our Convertible CRA Shares and
our preferred shares, if any, and our ability to make distributions of
tax-exempt income depends upon the application of tax laws", to the extent it
pertains to matters of law or legal conclusions with respect thereto, is
accurate in all material respects under the Code, the regulation thereunder,
published administrative rulings and judicial decisions published on or prior to
the date of this opinion.
B-1
Exhibit C
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 6(a)
(i) The Company has been duly created and is validly existing as
a business trust in good standing under the laws of the State of
Delaware, and under its trust agreement, as amended (the "Trust
Agreement"), resolutions of the board of trustees of the Company (the
"Resolutions") and the Delaware Business Trust Act (the "Trust Act"), has
full trust power and authority to own, lease and operate its properties
and to conduct its business as described in the Registration Statement
and Prospectus and to enter into and perform its obligations under, and
contemplated by, the Agreement.
(ii) The beneficial interests in the Company issued prior to the
date hereof have been duly authorized for issuance by the Trust Agreement
and are validly issued, fully paid and, subject to the qualifications set
forth in this paragraph (ii), nonassesable undivided interests in the
assets of the Company. The certificates for the beneficial interests in
the Company being issued on the date of the opinion (the "Firm Shares")
are in due and proper form. Each holder of such interests, in its
capacity as a beneficial owner of the Company, will be entitled to the
same limitation of personal liability as that extended to stockholders of
private corporations for profit organized under the General Corporation
Law of the State of Delaware. We note that a holder of such interests may
be obligated to make certain payments provided for in the Trust
Agreement. Under the Trust Agreement and the Trust Act, the issuance of
such interests was not subject to preemptive or similar rights.
(iii) The Firm Shares have been duly authorized for issuance by
the Trust Agreement, and, when issued, executed and authenticated in
accordance with the Trust Agreement and when delivered against payment
therefor in accordance with the Agreement will be fully paid and, subject
to the qualifications set forth in this paragraph (iii), non-assessable
undivided beneficial interests in the assets of the Company. Each holder
of Firm Shares, in its capacity as a beneficial owner of the Company,
will be entitled to the same limitation of personal liability as that
extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware. We note that
a holder of Firm Shares may be obligated to make certain payments
provided for in the Trust Agreement. Under the Trust Agreement and the
Trust Act, the issuance of the Firm Shares is not subject to preemptive
or other similar rights.
(iv) Each of the Subsidiaries has been duly created and is
validly existing as a business trust in good standing under the laws of
the State of Delaware and, under their respective trust agreements and
the Trust Act, has full trust power and authority to own, lease and
operate its properties and to conduct its business as described in the
Registration Statement and Prospectus.
C-1
(v) Except as otherwise disclosed in the Prospectus, all of the
issued and outstanding equity interests of each Subsidiary have been duly
and validly authorized and issued and are fully paid and non-assessable
interests in the assets of such Subsidiary that are owned by the Company,
directly or through other Subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; and none
of the outstanding equity interests of the Subsidiaries were issued in
violation of any preemptive right, resale right, right of first refusal
or similar right.
(vi) Under the Trust Agreement, the Resolutions and the Trust
Act, the Agreement and the Registration Statement have been duly
authorized by all requisite trust action on the part of the Company.
(vii) The Company's Trust Agreement has been duly authorized,
executed and delivered by the Company and constitutes a valid, legal and
binding agreement of the Company, and is enforceable against the Company,
in accordance with its terms.
(viii) After due inquiry on ____, 2001, limited to, and solely to
the extent disclosed thereupon, Court dockets for active cases of the
Court of Chancery of the State of Delaware in and for New Castle County,
Delaware, of the Superior Court of the State of Delaware in and for New
Castle County, Delaware, and of the United States District Court sitting
in the State of Delaware, we are not aware of any legal or governmental
proceeding pending against the Company.
(ix) The issuance, sale and delivery by the Company of the Firm
Shares, the execution, delivery and performance of the Agreement and the
Registration Statement and Prospectus by the Company and the consummation
of the transactions contemplated in the Agreement, the Registration
Statement and the Prospectus (including the use of the proceeds from the
sale of the Securities as described in the Prospectus under the caption
"Use of Proceeds") and the compliance by the Company with their
respective obligations under the Agreement, the Registration Statement
and the Firm Shares do not and will not, whether with or without the
giving of notice or lapse of time or both, violate the Trust Agreement or
violate any applicable Delaware statute or regulation.
(x) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any Delaware court or
Delaware governmental authority or Delaware agency is necessary or
required for the performance by the Company of its obligations under the
Agreement or in connection with the offering, issuance or sale of the
Firm Shares or the consummation of the transactions contemplated by the
Agreement, except such as have been already obtained or as contemplated
in the Registration Statement and Prospectus.
In rendering such opinion, such counsel may rely as to matters of
fact (but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials.
C-2
FORM OF LOCKUP AGREEMENT
Exhibit D
May __, 2001
UBS Warburg LLC,
as Representative of the several Underwriters
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Re: Proposed Public Offering by Charter Municipal Mortgage Acceptance
Company
-----------------------------------------------------------------
Ladies and Gentlemen:
The undersigned, a [trustee and/or executive officer] of Charter
Municipal Mortgage Acceptance Company, (the "Company"), understands that UBS
Warburg LLC ("UBSW") proposes to enter into an Underwriting Agreement (the
"Underwriting Agreement") with the Company providing for the public offering of
common shares of beneficial interest (the "Common Shares") of the Company. In
recognition of the benefit that such an offering will confer upon the
undersigned as a [trustee and/or executive officer] of the Company, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the undersigned agrees with each underwriter to be named in
the Underwriting Agreement that, during a period of 90 days after the date
hereof, the undersigned will not, without the prior written consent of UBSW,
offer, sell, contract to sell, hedge, or otherwise dispose of, directly or
indirectly, any of the undersigned's Common Shares or securities convertible
into or exchangeable for Common Shares.
Very truly yours,
Signature:_________________
Print Name:________________
D-1
