Securities and Exchange Commission
Washington, DC 20549
Form 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) October 27, 2003
ONE LIBERTY PROPERTIES, INC.
(Exact Name of Registrant as Specified in its Charter)
Maryland 0-11083 13-3147497
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(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
60 Cutter Mill Road, Suite 303, Great Neck, New York 07004
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (516) 466-3100
(Former Name or Former Address, if Changed Since Last Report)
ITEM 5. OTHER EVENTS AND REQUIRED FD DISCLOSURE
On September 12, 2003, One Liberty Properties, Inc. (the "Company")
filed a registration statement on Form S-3 (Commission File No. 333-108765) (the
"Registration Statement") with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act"), with
respect to an aggregate of $200,000,000 of common stock that may be sold by the
Company from time to time pursuant to Rule 415 under the Act. On October 2,
2003, the Registration Statement was declared effective by the Commission.
On October 27, 2003, the Company entered into an underwriting agreement
(the "Underwriting Agreement") with Friedman, Billings, Ramsey & Co., Inc.,
Ferris, Baker Watts, Incorporated and Stifel, Nicolaus & Company, Incorporated
as underwriters, for the public offering of up to 3,250,000 shares of the
Company's common stock (plus an additional 467,500 shares of common stock to
cover the underwriters' over-allotment option) pursuant to the Registration
Statement, and filed with the Commission pursuant to Rule 424(b)(2) under the
Act a definitive prospectus supplement setting forth, among other things, the
public offering price and other terms of the offering as set forth in the
Underwriting Agreement (the "Prospectus Supplement").
In connection with the execution of the Underwriting Agreement and the
filing of the Prospectus Supplement with the Commission, the Company is filing
this Report on Form 8-K in order to file the Underwriting Agreement, which
exhibit shall be deemed to be incorporated by reference into the Registration
Statement. Also attached hereto as Exhibit 99.1 is a press release issued by the
Company on October 27, 2003 regarding the pricing of the offering of its common
stock pursuant to the Underwriting Agreement. See "Item 7. Financial Statements
and Exhibits."
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
The following exhibits are filed with this report on Form 8-K:
Exhibit No. Description
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1.1 Underwriting Agreement dated October 27, 2003 between
the Company and Friedman, Billings, Ramsey & Co., Inc.
Ferris, Baker Watts, Incorporated and Stifel, Nicolaus
& Company, Incorporated, as Representatives of the
several Underwriters
99.1 Press Release of the Company, dated October 27, 2003
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ONE LIBERTY PROPERTIES, INC.
Date: October 28, 2003 By: /s/ Mark H. Lundy
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Mark H. Lundy
Vice President
EXHIBIT INDEX
Exhibit No. Description
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1.1 Underwriting Agreement dated October 27, 2003 between
the Company and Friedman, Billings, Ramsey & Co., Inc.
Ferris, Baker Watts, Incorporated and Stifel, Nicolaus
& Company, Incorporated as Representatives of the
several Underwriters
99.1 Press Release of the Company, dated October 27, 2003
EXHIBIT 1.1
ONE LIBERTY PROPERTIES, INC.
3,250,000 SHARES OF COMMON STOCK
UNDERWRITING AGREEMENT
TABLE OF CONTENTS
PAGE
1. Sale and Purchase...................................................3
2. Payment and Delivery................................................3
3. Representations and Warranties of the Company ......................4
4. Certain Covenants of the Company ..................................14
5. Payment of Expenses ...............................................17
6. Conditions of the Underwriters' Obligations .......................18
7. Termination........................................................25
8. Increase in Underwriters' Commitments .............................26
9. Indemnity and Contribution by the Company and the Underwriters.....26
10. Survival ..........................................................30
11. Notices ...........................................................30
12. Governing Law; Consent to Jurisdiction; Headings ..................30
13. Parties in Interest................................................31
14. Counterparts.......................................................31
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ONE LIBERTY PROPERTIES, INC.
3,250,000 SHARES OF COMMON STOCK
UNDERWRITING AGREEMENT
October 27, 2003
FRIEDMAN, BILLINGS, RAMSEY & CO., INC.
FERRIS, BAKER WATTS, INCORPORATED
STIFEL, NICOLAUS & COMPANY, INCORPORATED as Representatives of the several
Underwriters c/o Friedman, Billings, Ramsey & Co., Inc. 1001 19th Street North
Arlington, Virginia 22209
Dear Sirs:
One Liberty Properties, Inc., a Maryland corporation (the "Company"),
confirms its agreement with Friedman, Billings, Ramsey & Co., Inc., Ferris,
Baker Watts, Incorporated, Stifel, Nicolaus & Company, Incorporated and each of
the other Underwriters listed on Schedule I hereto (collectively, the
"Underwriters"), for whom Friedman, Billings, Ramsey & Co., Inc., Ferris, Baker
Watts, Incorporated and Stifel, Nicolaus & Company, Incorporated are acting as
representatives (in such capacity, the "Representatives"), with respect to (i)
the sale by the Company and the purchase by the Underwriters, acting severally
and not jointly, of the respective numbers of shares of common stock of the
Company, $1.00 par value per share (the "Common Shares"), set forth in Schedule
I hereto and (ii) the grant by the Company to the Underwriters, acting severally
and not jointly, of the option described in Section 1(b) hereof to purchase all
or any part of 487,500 Common Shares to cover over-allotments, if any. The
3,250,000 Common Shares to be purchased by the Underwriters (the "Initial
Shares") and all or any part of the 487,500 Common Shares subject to the option
described in Section 1(b) hereof (the "Option Shares") are hereinafter called,
collectively, the "Shares." The Company acknowledges that at its request, the
Underwriters have reserved up to 50,000 of the Initial Shares for sale to Gould
Investors L.P. at the purchase price per share of $17.3375.
The Company understands that the Underwriters propose to make a public
offering of the Shares as soon as the Underwriters deem advisable after this
Agreement has been executed and delivered.
The Company has filed, in accordance with the provisions of the
Securities Act of 1933, as amended (the "Securities Act"), and the rules and
regulations thereunder (the "Securities Act Regulations"), with the Securities
and Exchange Commission (the "Commission"), a registration statement on Form S-3
(No. 333-108765) (the "Registration Statement") relating to the offering of up
to $200,000,000 of its common stock by the Company from time to time pursuant to
Rule 415 of the Securities Act. The Registration Statement, as declared
effective on October 2, 2003, contains a prospectus and incorporates by
reference documents which the Company has filed or will file in accordance with
the provisions of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the rules and regulations thereunder (the "Exchange Act
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Regulations"). The Company has prepared a prospectus supplement (the "Prospectus
Supplement") to the prospectus included as part of the Registration Statement
setting forth the terms of the offering, sale and plan of distribution of the
Shares and additional information concerning the Company and its business. The
Company has furnished to the Representatives, for use by the Underwriters and by
dealers, copies of one or more preliminary prospectuses containing the
prospectus included as part of the Registration Statement, as supplemented by a
preliminary Prospectus Supplement dated October 14, 2003, and including the
documents incorporated in such prospectus by reference (collectively, the
"Preliminary Prospectus") relating to the Shares. Except where the context
otherwise requires, the Registration Statement, as amended when it became
effective, including all documents filed as part thereof or incorporated by
reference therein which have been filed with the Commission prior to the date
hereof, and including any information contained in a Prospectus (as defined
below) subsequently filed with the Commission pursuant to Rule 424(b) of the
Securities Act Regulations are collectively herein called the "Registration
Statement," and the prospectus, including all documents incorporated therein by
reference which have been filed with the Commission prior to the date hereof,
included in the Registration Statement, as supplemented by the Prospectus
Supplement dated October 27, 2003, in the form filed by the Company with the
Commission pursuant to Rule 424(b) of the Securities Act Regulations on or
before the second business day following the date of this Agreement (or on such
other day as the parties may mutually agree), is herein called the "Prospectus."
Any registration statement (including any supplement thereto or information
which is deemed part thereof) filed by the Company under Rule 462(b) of the
Securities Act Regulations (a "Rule 462(b) Registration Statement") shall be
deemed to be part of the Registration Statement. Any prospectus (including any
amendment or supplement thereto or information which is deemed part thereof)
included in the Rule 462(b) Registration Statement shall be deemed to be part of
the Prospectus. All references in this Agreement to financial statements and
schedules and other information which are "contained," "included," "set forth,"
"contemplated" or stated" in the Registration Statement, the Prospectus or any
Preliminary Prospectus (and all other references of like import) shall be deemed
to mean and include all such financial statements and schedules and other
information which have been filed with the Commission prior to the date hereof
and which are or are deemed to be incorporated by reference in the Registration
Statement, the Prospectus or any Preliminary Prospectus, as the case may be. Any
reference herein to the Registration Statement, the Prospectus, any Preliminary
Prospectus or any amendment or supplement thereto shall be deemed to refer to
and include the documents incorporated by reference therein, and any reference
herein to the terms "amend," "amendment" or "supplement" with respect to the
Registration Statement, the Prospectus or any Preliminary Prospectus shall be
deemed to refer to and include the filing after the execution hereof and through
the Closing Time of any document with the Commission deemed to be incorporated
by reference therein. For purposes of this Agreement, all references to the
Registration Statement, the Prospectus, any Preliminary Prospectus or to any
amendment or supplement thereto shall be deemed to include any copy filed with
the Commission pursuant to its Electronic Data Gathering Analysis and Retrieval
System ("EDGAR"), and such copy shall be identical in content to any Prospectus
or Preliminary Prospectus delivered to the Underwriters for use in connection
with the offering of the Shares. The Commission has not issued any order
preventing or suspending the use of any Preliminary Prospectus.
The Company and the Underwriters agree as follows:
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1. Sale and Purchase.
(a) Initial Shares. Upon the basis of the warranties and representations
and other terms and conditions herein set forth, the Company agrees to sell to
each Underwriter, severally and not jointly, and each Underwriter agrees,
severally and not jointly, to purchase from the Company at the purchase price
per share of $17.3375, the number of Initial Shares set forth in Schedule I
opposite such Underwriter's name, plus any additional number of Initial Shares
which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 8 hereof subject, in each case, to such adjustments among
the Underwriters as the Representatives in their sole discretion shall make to
eliminate any sales or purchases of fractional shares.
(b) Option Shares. In addition, upon the basis of the warranties and
representations and other terms and conditions herein set forth, the Company
hereby grants an option to the Underwriters, severally and not jointly, to
purchase from the Company all or any part of the Option Shares at the purchase
price per share set forth in paragraph (a) above plus, with respect to each
Underwriter purchasing Option Shares, any additional number of Option Shares
which each Underwriter may become obligated to purchase pursuant to the
provisions of Section 8 hereof. The option hereby granted will expire 30 days
after the date hereof and may be exercised in whole or in part from time to time
prior to the expiration of such 30 day period only for the purpose of covering
over-allotments, which may be made in connection with the offering and
distribution of the Initial Shares, upon written notice by the Representatives
to the Company setting forth the number of Option Shares as to which the several
Underwriters are then exercising the option and the time and date of payment and
delivery for such Option Shares. Any such time and date of delivery (a "Date of
Delivery") shall be determined by the Representatives, but shall not be later
than three full business days (nor earlier, without the consent of the Company,
than two full business days) after the exercise of said option, nor in any event
prior to the Closing Time. If the option is exercised as to all or any portion
of the Option Shares, each of the Underwriters, acting severally and not
jointly, will purchase that proportion of the total number of Option Shares then
being purchased which the number of Initial Shares set forth in Schedule I
opposite the name of such Underwriter bears to the total number of Initial
Shares, subject in each case to such adjustments as the Representatives in their
sole discretion shall make to eliminate any sales or purchases of fractional
shares.
(c) Terms of Public Offering. The Company is advised by you that the
Shares are to be offered to the public initially at $18.25 per share (the
"Public Offering Price") and to certain dealers selected by you at a price that
represents a concession not in excess of $0.54 per share less than the Public
Offering Price, and that any Underwriter may allow, and such dealers may
reallow, a concession, not in excess of $0.10 per share, to any Underwriter or
to certain other dealers. The Underwriters may from time to time increase or
decrease the Public Offering Price of the Shares after the initial public
offering to such extent as the Underwriters may determine.
2. Payment and Delivery.
(a) Initial Shares. The Initial Shares to be purchased by each
Underwriter hereunder, in definitive form, and in such authorized denominations
and registered in such names as the Representatives may request upon at least
forty-eight hours' prior written notice to the Company shall be delivered by or
on behalf of the Company to the Representatives, including, at the option
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of the Representatives, through the facilities of The Depository Trust Company
("DTC") for the account of each Underwriter, against payment by or on behalf of
each Underwriter of the purchase price therefor by wire transfer of Federal
(same-day) funds to the account specified to the Representatives by the Company
upon at least forty-eight hours' prior written notice. The Company will cause
the certificates representing the Initial Shares to be made available for
checking and packaging at least twenty-four hours prior to the Closing Time with
respect thereto. The time and date of such delivery and payment shall be 9:30
a.m., New York City time, on October 31, 2003 or on such other time and date as
the Company and the Representatives may agree upon in writing. The time at which
such payment and delivery are actually made is hereinafter sometimes called the
"Closing Time" and the date of delivery of both Initial Shares and Option Shares
is hereinafter sometimes called the "Date of Delivery."
(b) Option Shares. Any Option Shares to be purchased by each Underwriter
hereunder, in definitive form, and in such authorized denominations and
registered in such names as the Representatives may request upon at least
forty-eight hours' prior written notice to the Company shall be delivered by or
on behalf of the Company to the Representatives, including, at the option of the
Representatives, through the facilities of DTC for the account of such
Underwriter, against payment by or on behalf of such Underwriter of the purchase
price therefor by wire transfer of Federal (same-day) funds to the account
specified to the Representatives by the Company upon at least forty-eight hours'
prior written notice. The Company will cause the certificates representing the
Option Shares to be made available for checking and packaging at least
twenty-four hours prior to the Date of Delivery with respect thereto. The time
and date of such delivery and payment shall be 9:30 a.m., New York City time, on
the date specified by the Representatives in the notice given by the
Representatives to the Company of the Underwriters' election to purchase such
Option Shares or on such other time and date as the Company and the
Representatives may agree upon in writing.
3. Representations and Warranties of the Company. The Company represents and
warrants to the Underwriters that:
(a) each of the Company, the subsidiaries of the Company and certain
other related companies as set forth on Schedule II hereto (each a "Subsidiary"
and, collectively, the "Subsidiaries") has been duly formed or incorporated, as
the case may be, and is validly existing and in good standing under the laws of
its respective jurisdiction of formation or incorporation with all requisite
corporate power and authority to own, lease and operate its respective
properties and to conduct its respective business as now conducted and, in the
case of the Company, to authorize, execute and deliver this Agreement, and to
consummate the transactions described in each such agreement;
(b) the Company and the Subsidiaries are duly qualified or registered to
transact business in each jurisdiction in which they conduct their respective
businesses as now conducted and in which the failure, individually or in the
aggregate, to be so qualified or registered could reasonably be expected to have
a material adverse effect on the assets, operations, business, prospects or
condition (financial or otherwise) of the Company and the Subsidiaries taken as
a whole, and the Company and the Subsidiaries are in good standing in each
jurisdiction in which they maintain an office or in which the nature or conduct
of their respective businesses as now conducted requires such qualification,
except where the failure to be in good standing could not reasonably be expected
to have a material adverse effect on the assets, operations, business, prospects
or condition (financial or otherwise) of the Company and the Subsidiaries taken
as a whole;
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(c) the Company and the Subsidiaries, and their assets, operations and
business, are in compliance in all material respects with all applicable laws,
rules, regulations, orders, decrees and judgments;
(d) neither the Company nor any of the Subsidiaries is in breach of, or
in default under (nor has any event occurred which with notice, lapse of time,
or both would constitute a breach of, or default under), its respective charter,
by-laws, certificate of limited liability company, agreement of limited
liability company, certificate of limited partnership or partnership agreement,
as the case may be, or in the performance or observance of any obligation,
agreement, covenant or condition contained in any license, advisory agreement,
management agreement, lease, indenture, mortgage, deed of trust, deed to secure
debt, loan or credit agreement or other agreement or instrument to which the
Company or any of the Subsidiaries is a party or by which any of them or their
respective properties is bound, except for such breaches or defaults which could
not reasonably be expected to have a material adverse effect on the assets,
operations, business, prospects or condition (financial or otherwise) of the
Company and the Subsidiaries taken as a whole, and the issuance, sale and
delivery by the Company of the Shares, the execution, delivery and performance
of this Agreement and consummation of the transactions contemplated hereby will
not conflict with, or result in any breach of, or constitute a default under
(nor constitute any event which with notice, lapse of time, or both would
constitute a breach of, or default under), (i) any provision of the charter,
by-laws, certificate of limited liability company, agreement of limited
liability company, certificate of limited partnership or partnership agreement,
as the case may be, of the Company or any of the Subsidiaries, (ii) any
provision of any license, advisory agreement, management agreement, lease,
indenture, mortgage, deed of trust, deed to secure debt, loan or credit
agreement or other agreement or instrument to which the Company or any of the
Subsidiaries is a party or by which any of them or their respective properties
may be bound or affected, or (iii) any Federal, state, local or foreign law,
regulation or rule or any decree, judgment or order applicable to the Company or
any of the Subsidiaries, and no such license, advisory agreement, management
agreement, lease, indenture, mortgage, deed of trust, deed to secure debt, loan
or credit agreement or other agreement or instrument to which the Company or any
of the Subsidiaries is a party or by which any of them or their respective
properties may be bound contains a materially burdensome restriction that is not
adequately disclosed in the Registration Statement and the Prospectus;
(e) the Company has full legal right, power and authority to enter into
and perform this Agreement and to consummate the transactions contemplated
herein; 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 as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally, and by general principles of equity, and except to the extent
that the indemnification and contribution provisions of Section 9 hereof may be
limited by Federal or state securities laws and public policy considerations in
respect thereof,
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(f) the issuance and sale of the Shares to the Underwriters hereunder
have been duly authorized by the Company; when issued and delivered against
payment therefor as provided in this Agreement, the Shares will be validly
issued, fully paid and non-assessable and the issuance of the Shares will not be
subject to any preemptive or similar rights; except as contemplated herein, no
person or entity holds a right to require or participate in the registration
under the Securities Act of the Shares pursuant to the Registration Statement;
no person or entity has a right of participation or first refusal with respect
to the sale of the Shares by the Company; there are no contracts, agreements or
understandings between the Company and any person or entity granting such person
or entity the right to require the Company to file a registration statement
under the Securities Act with respect to any securities of the Company or to
require the Company to include such securities with the Shares registered
pursuant to the Registration Statement; the form of certificates evidencing the
Shares complies with all applicable legal requirements and with all applicable
requirements of the charter and bylaws of the Company and the requirements of
the American Stock Exchange;
(g) no approval, authorization, consent or order of or filing with any
Federal, state or local governmental or regulatory commission, board, body,
authority or agency is required in connection with the execution, delivery and
performance of this Agreement, the consummation of the transactions contemplated
hereby or the sale and delivery of the Shares as contemplated hereby other than
(i) such as have been obtained, or will have been obtained at the Closing Time
or the relevant Date of Delivery, as the case may be, under the Securities Act
or the Securities Exchange Act of 1934, as amended (the "Exchange Act"), (ii)
such approvals as have been obtained in connection with the approval of the
listing of the Shares on the American Stock Exchange and (iii) any necessary
qualification under the securities or blue sky laws of the various jurisdictions
in which the Shares are being offered by the Underwriters;
(h) each of the Company and the Subsidiaries has all necessary licenses,
authorizations, consents and approvals and has made all necessary filings
required under any Federal, state or local law, regulation or rule, and has
obtained all necessary authorizations, consents and approvals from other persons
required in order to own their respective assets and to conduct their respective
operations and businesses as described in the Prospectus, except to the extent
that any failure to have any such licenses, authorizations, consents or
approvals, to make any such filings or to obtain any such authorizations,
consents or approvals could not reasonably be expected to have, individually or
in the aggregate, a material adverse effect on the assets, operations, business,
prospects or condition (financial or otherwise) of the Company and the
Subsidiaries taken as a whole; neither the Company nor any of the Subsidiaries,
nor any of their assets, operations or businesses is in violation of, in default
under, or has received any notice regarding a possible violation, default or
revocation of any such license, authorization, consent or approval or any
Federal, state, local or foreign law, regulation or rule or any decree, order or
judgment applicable to the Company or any of the Subsidiaries, the effect of
which could reasonably be expected to be material and adverse to the assets,
operations, business, prospects or condition (financial or otherwise) of the
Company and the Subsidiaries taken as a whole; and no such license,
authorization, consent or approval contains a materially burdensome restriction
that is not adequately disclosed in the Registration Statement and the
Prospectus;
(i) each of the Registration Statement and any Rule 462(b) Registration
Statement has become effective under the Securities Act and no stop order
suspending the effectiveness of
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the Registration Statement or any Rule 462(b) Registration Statement has been
issued under the Securities Act and no proceedings for that purpose have been
instituted or are pending or, to the knowledge of the Company, are threatened by
the Commission, and any request on the part of the Commission for additional
information has been complied with;
(j) the Company and the transactions contemplated by this Agreement meet
the requirements and conditions for using a registration statement on Form S-3
under the Securities Act, set forth in the General Instructions to Form S-3; the
Preliminary Prospectus and the Registration Statement comply and the Prospectus
and any further amendments or supplements thereto will comply, when they have
become effective or are filed with the Commission, as the case may be, in all
material respects with the requirements of the Securities Act and the Securities
Act Regulations and, in each case, present, or will present, fairly the
information required to be shown; the Registration Statement did not, and any
amendment thereto will not, in each case as of the applicable effective date,
contain any 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 Preliminary Prospectus does not, and the Prospectus or any
amendment or supplement thereto will not, as of the applicable filing date and
at the Closing Time and on each Date of Delivery (if any), contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the Company makes no warranty or representation with respect to any
statement contained in the Registration Statement or the Prospectus in reliance
upon and in conformity with the information concerning the Underwriters and
furnished in writing by or on behalf of the Underwriters through the
Representatives to the Company expressly for use in the Registration Statement
or the Prospectus (that information being limited to that described in the last
sentence of the first paragraph of Section 9(b) hereof);
(k) the Preliminary Prospectus was and the Prospectus delivered to the
Underwriters for use in connection with this offering will be identical to the
versions of the Preliminary Prospectus and Prospectus created to be transmitted
to the Commission for filing via EDGAR, except to the extent permitted by
Regulation S-T;
(1) each document incorporated by reference or deemed to be incorporated
by reference in the Registration Statement and in the Prospectus, when each
became effective or was filed with the Commission, as the case may be, conformed
in all material respects to the requirements of the Securities Act or the
Exchange Act, as applicable, and the Securities Act Regulations and the
regulations promulgated under the Exchange Act (the "Exchange Act Regulations"),
and none of such documents 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, in the light of the circumstances under which they
were made, not misleading; and any further documents so filed and incorporated
by reference in the Registration Statement and the Prospectus or any further
amendment or supplement thereto, when such documents become effective or are
filed with the Commission, as the case may be, will conform in all material
respects to the requirements of the Securities Act or the Exchange Act, as
applicable, and the Securities Act Regulations and the Exchange Act Regulations
and will not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;
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(m) all legal or governmental proceedings, contracts or documents which
are material and of a character required to be filed as exhibits to the
Registration Statement or to be summarized or described in the Prospectus have
been so filed, summarized or described as required;
(n) there are no actions, suits, proceedings, inquiries or
investigations pending or, to the Company's knowledge, threatened against the
Company or any of the Subsidiaries or any of their respective officers and
directors or to which the properties, assets or rights of any such entity is
subject, at law or in equity, before or by any Federal, state, local or foreign
governmental or regulatory commission, board, body, authority, arbitration panel
or agency which could reasonably be expected to result in a judgment, decree,
award or order having a material adverse effect on the assets, operations,
business, prospects or condition (financial or otherwise) of the Company and the
Subsidiaries taken as a whole, or which could adversely affect the consummation
of the transactions contemplated by this Agreement in any material respect;
(o) the financial statements, including the notes thereto, included in
the Registration Statement and the Prospectus or incorporated by reference
therein present fairly the financial position of the Company and the
Subsidiaries as of the dates indicated and the results of operations and changes
in financial position and cash flows of the Company and the Subsidiaries for the
periods specified; such financial statements have been prepared in conformity
with generally accepted accounting principles applied on a consistent basis
during the periods involved (except as indicated in the notes thereto); the
financial statement schedules included in the Registration Statement and the
Prospectus or incorporated by reference therein fairly present the information
shown therein; no other financial statements or schedules are required by Form
S-3 or otherwise to be included in the Registration Statement or Prospectus;
(p) the Company has filed in a timely manner all reports required to be
filed pursuant to Sections 13, 14, 15(d) of the Exchange Act during the
preceding twelve calendar months and if during such period the Company has
relied on Rule 12b-25(b) under the Exchange Act ("Rule 12b-25(b)") with respect
to a report or a portion of a report, that report or portion of a report has
actually been filed within the time period prescribed by Rule 12b-25(b);
(q) Ernst & Young LLP, whose reports on the audited financial statements
of the Company and the Subsidiaries are included as part of the Registration
Statement and Prospectus or are incorporated by reference therein are and were
during the periods covered by their reports independent public accountants
within the meaning of the Securities Act and the Securities Act Regulations;
(r) subsequent to the respective dates as of which information is given
in the Registration Statement and the Prospectus, and except as may be otherwise
stated in the Registration Statement or Prospectus, there has not been (i) any
material adverse change in the assets, operations, business, prospects or
condition (financial or otherwise), present or prospective, of the Company and
the Subsidiaries taken as a whole, whether or not arising in the
8
ordinary course of business, (ii) any transaction, which is material to the
Company and the Subsidiaries taken as a whole, planned or entered into by the
Company or any of the Subsidiaries, (iii) any obligation, contingent or
otherwise, directly or indirectly incurred by the Company or any of the
Subsidiaries, which is material to the Company and the Subsidiaries taken as a
whole or (iv) except in accordance with the Company's ordinary practice as
disclosed in the Registration Statement and the Prospectus, any dividend or
distribution of any kind declared, paid or made with respect to the capital
stock of the Company;
(s) the authorized shares of capital stock of the Company conform in all
material respects to the description thereof contained in the Prospectus; the
Company has an authorized, issued and outstanding capitalization as set forth in
the Prospectus under the caption "Capitalization" as of the date stated in such
section; immediately after the Closing Time, 9,009,122 Common Shares and 648,058
shares of $16.50 Cumulative Convertible Preferred Stock, par value $1.00 per
share (the "Preferred Stock") will be issued and outstanding (subject to the
Underwriters' option described in Section 1(b) hereof) and no shares of any
other class of capital stock will be issued and outstanding. All of the issued
and outstanding shares of capital stock of the Company have been duly authorized
and are validly issued, fully paid and nonassessable, and have been offered,
sold and issued by the Company in compliance with all applicable laws
(including, without limitation, Federal and state securities laws); none of the
issued shares of capital stock of the Company have been issued in violation of
any preemptive or similar rights granted by the Company; except as disclosed in
the Prospectus, there is no outstanding option, warrant or other right calling
for the issuance of, and no commitment, plan or arrangement to issue, any shares
of capital stock of the Company or any security convertible into or exchangeable
for shares of capital stock of the Company;
(t) each of the Company, the Subsidiaries, and each of their respective
officers, directors and controlling persons, directly or indirectly, (A) has not
taken, and will not take any action which is designed to or which has
constituted or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares, or (B) since the filing of the
Registration Statement: (1) sold, bid for, purchased, or paid anyone any
compensation for soliciting purchases of, the Shares, or (2) paid or agreed to
pay to any person any compensation for soliciting another to purchase any other
securities of the Company;
(u) neither the Company nor any of its affiliates (i) is required to
register as a "broker" or "dealer" in accordance with the provisions of the
Exchange Act or the Exchange Act Regulations, or (ii) directly, or indirectly
through one or more intermediaries, controls or has any other association with
(within the meaning of Article 1 of the By-laws of the National Association of
Securities Dealers, Inc. (the "NASD")) any member firm of the NASD;
(v) the Company has not relied upon the Representatives or legal
counsel for the Representatives for any legal, tax or accounting advice in
connection with the offering and sale of the Shares;
(w) any certificate signed by any officer of the Company or any
Subsidiary delivered to the Representatives or to counsel for the Underwriters
pursuant to or in connection with this Agreement shall be deemed a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby;
9
(x) the Company and each of its Subsidiaries have good and marketable
title in fee simple to all real property and all the improvements thereon owned,
or described in the Prospectus as owned, by them, good and marketable title to
the lessor's interest under each lease at each of such properties, and good
title to all personal property owned, or described in the Prospectus as owned,
by them, in each case free and clear of all liens, security interests, pledges,
charges, leases, encumbrances, mortgages and defects, except such as are
disclosed generally in the Prospectus or the financial statements thereto or
such as do not materially and adversely affect the value to the Company of such
property and do not interfere with the use made or proposed to be made of such
property by the Company and the Subsidiaries and by the lessee under each lease
at each of such properties; all the leases of real property and buildings to
which the Company or any Subsidiary is a party are valid, existing and
enforceable leases, with no exceptions, and subject to no liens, security
interests, pledges, charges, encumbrances, mortgages or defects, other than as
are disclosed in the Prospectus or as are not material to the Company and do not
interfere with the use made or proposed to be made of such property and
buildings by the Company or such Subsidiary and by the lessee under each lease
at each of such properties and neither the Company nor any Subsidiary knows of
any default or possible default under any such lease by the Company or any
Subsidiary or any other party to such lease; the Company or a Subsidiary has
obtained a valid and enforceable owner's title insurance policy from a title
insurance company licensed to issue such policy on any real property owned by
the Company or any Subsidiary that remains in force and insures the Company's or
the Subsidiary's fee interest in such real property with coverage in an amount
at least equal to the greater of the original purchase price of such fee
interest in the real property and the maximum aggregate principal amount of any
indebtedness of the Company or any Subsidiary and secured by the real property;
(y) the improvements at each real property owned by the Company or any
of its Subsidiaries are in good condition and repair in accordance with the
terms of each respective lease at each such property and are in compliance with
all applicable zoning and other applicable laws, ordinances and regulations, and
no such property or improvements presently is affected by an event of casualty,
or is presently subject to or threatened in writing with an event of
condemnation, in each case other than as does not interfere with the use made or
proposed to be made of such property and improvements by the Company or such
Subsidiary and by the lessee under each lease at each of such properties and
will not materially and adversely affect the value of such property and
improvements; the joint venture agreements, limited liability company
agreements, limited partnership agreements and other agreements pursuant to
which the Company or its Subsidiaries own real property or interests in entities
which own real property, and the purchase agreements to which the Company or any
its Subsidiaries is a party pursuant to which the Company or any of its
Subsidiaries has agreed to acquire real property, are valid, legally binding and
enforceable, except to the extent enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally and by general principles of equity, and neither the Company
nor any Subsidiary knows of any default or possible default under any such
agreement by the Company or any Subsidiary or any other party to such agreement;
the Preliminary Prospectus correctly states, and the Prospectus or any amendment
or supplement thereto will correctly state in all material respects, as of the
applicable filing date and at the Closing Time and on each Date of Delivery (if
any), the rentable square footage of the improvements at, the type of use
presently being made of, and the 2003 contractual rental revenue stated to be
paid by the tenant at, each real property owned by the Company and its
Subsidiaries;
10
(z) to the knowledge of the Company, there are no statutes or
regulations applicable to the Company or any of the Subsidiaries or the assets,
operations, or businesses of any of them or certificates, permits or other
authorizations from governmental regulatory officials or bodies required to be
obtained or maintained by the Company or any of the Subsidiaries of a character
required to be disclosed in the Registration Statement or the Prospectus which
have not been so disclosed and properly described therein; all agreements
between the Company or any of the Subsidiaries and third parties expressly
referenced in the Registration Statement are legal, valid and binding
obligations of the Company or one or more of the Subsidiaries, enforceable in
accordance with their respective terms, except to the extent enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally and by general principles of equity;
(aa) no relationship, direct or indirect, exists between or among the
Company or any of the Subsidiaries on the one hand, and the directors, trustees,
officers, shareholders, customers or suppliers of the Company or any of the
Subsidiaries on the other hand, which is required by the Securities Act to be
described in the Registration Statement and the Prospectus which is not so
described;
(bb) the Company and each Subsidiary owns or possesses adequate license
or other rights to use all patents, trademarks, service marks, trade names,
copyrights, software and design licenses, trade secrets, manufacturing
processes, other intangible property rights and know-how, if any (collectively
"Intangibles"), necessary to entitle the Company and each Subsidiary to conduct
its business as described in the Prospectus, and neither the Company, nor any
Subsidiary, has received notice of infringement of or conflict with (and knows
of no such infringement of or conflict with) asserted rights of others with
respect to any Intangibles which could materially and adversely affect the
assets, operations, business, prospects or condition (financial or otherwise) of
the Company or any Subsidiary;
(cc) each of the Company and the Subsidiaries has filed on a timely
basis all necessary Federal, state, local and foreign income, franchise and real
or personal property tax returns, if any such returns were required to be filed,
through the date hereof and have paid all taxes shown as due thereon; and no tax
deficiency has been asserted against the Company or any of the Subsidiaries, nor
does the Company or any of the Subsidiaries know of any tax deficiency which is
likely to be asserted against any such entity which, if determined adversely to
any such entity, could materially adversely affect the assets, operations,
business, prospects or condition (financial or otherwise) of any such entity,
respectively; all tax liabilities, if any, are adequately provided for on the
respective books of such entities;
(dd) each of the Company and the Subsidiaries maintains insurance or
its tenants maintain insurance to the benefit of the Company or its Subsidiaries
(issued by insurers of recognized financial responsibility) of the types and in
the amounts generally deemed adequate, if any, for their respective businesses
and consistent with insurance coverage maintained by similar companies in
similar businesses, including, but not limited to, insurance covering real
11
and personal property owned or leased by the Company and the Subsidiaries
against theft, damage, destruction, acts of vandalism and all other risks
customarily insured against, and such insurance includes coverage for each
property in an amount not less than the replacement cost (less the amount of a
commercially reasonable deductible) for the improvements at such property, all
of which insurance is in full force and effect;
(ee) except as otherwise disclosed in the Prospectus, neither the
Company, any of the Subsidiaries nor to the knowledge of the Company, any former
owner of any real property owned by the Company or the Subsidiaries has
authorized or conducted or has knowledge of the generation, transportation,
storage, presence, use, treatment, disposal, release, or other handling of any
hazardous substance, hazardous waste, hazardous material, hazardous constituent,
toxic substance, pollutant, contaminant, asbestos, radon, polychlorinated
biphenyls ("PCBs"), petroleum product or waste (including crude oil or any
fraction thereof), natural gas, liquefied gas, synthetic gas or other material
defined, regulated, controlled or potentially subject to any remediation
requirement under any environmental law (collectively, "Hazardous Materials"),
on, in, under or affecting any real property currently leased or owned or by any
means controlled by the Company or any of the Subsidiaries, including any real
property underlying any loan held by the Company or the Subsidiaries and any
real property owned by an entity in which the Company or the Subsidiaries own an
interest (collectively, the "Real Property"), and the Company's, the
Subsidiaries' and, to the knowledge of the Company, the former owners of the
Real Property's operations with respect to the Real Property, are and were in
compliance with all Federal, state and local laws, ordinances, rules,
regulations and other governmental requirements relating to pollution, control
of chemicals, management of waste, discharges of materials into the environment,
health, safety, natural resources, and the environment (collectively,
"Environmental Laws"), and the Company and the Subsidiaries are in compliance
with, all licenses, permits, registrations and government authorizations
necessary to operate under all applicable Environmental Laws; except as
otherwise disclosed in the Prospectus, neither the Company nor the Subsidiaries
or, to the knowledge of the Company, any former owner of any of the Real
Property has received any written or oral notice from any governmental entity or
any other person; there is no pending or threatened claim, litigation or any
administrative agency proceeding that (A) alleges a violation of any
Environmental Laws by the Company or any of the Subsidiaries, (B) alleges that
the Company or any of the Subsidiaries is a liable party or a potentially
responsible party under the Comprehensive Environmental Response, Compensation
and Liability Act, 42 U.S.C. ss. 9601, et seg., or any state superfund law, (C)
has resulted in or could result in the attachment of an environmental lien on
any of the Real Property, or (D) alleges that the Company or any of the
Subsidiaries is liable for any contamination of the environment, contamination
of the Real Property, damage to natural resources, property damage, or personal
injury based on their activities or the activities of their predecessors or
third parties (whether at the Real Property or elsewhere) involving Hazardous
Materials, whether arising under the Environmental Laws, common law principles,
or other legal standards;
(ff) neither the Company nor any of the Subsidiaries nor, to the best
of the Company's knowledge, any officer, director or trustee purporting to act
on behalf of the Company or any of the Subsidiaries has at any time; (i) made
any contributions to any candidate for political office, or failed to disclose
fully any such contributions, in violation of law, (ii) made any payment to any
state, Federal or foreign governmental officer or official, or other person
charged with similar public or quasi-public duties, other than payments required
or allowed by applicable law,
12
(iii) made any payment outside the ordinary course of business to any investment
officer or loan broker or person charged with similar duties of any entity to
which the Company or any of the Subsidiaries sells or from which the Company or
any of the Subsidiaries buys loans or servicing arrangements for the purpose of
influencing such agent, officer, broker or person to buy loans or servicing
arrangements from or sell loans to the Company or any of the Subsidiaries, or
(iv) engaged in any transactions, maintained any bank account or used any
corporate funds except for transactions, bank accounts and funds which have been
and are reflected in the normally maintained books and records of the Company
and the Subsidiaries;
(gg) except as otherwise disclosed in the Prospectus, there are no
material outstanding loans or advances or material guarantees of indebtedness by
the Company or any of the Subsidiaries to or for the benefit of any of the
officers or directors of the Company or any of the Subsidiaries or any of the
members of the families of any of them;
(hh) neither the Company nor any of the Subsidiaries nor, to the
Company's knowledge, any employee or agent of the Company or any of the
Subsidiaries, has made any payment of funds of the Company or of any Subsidiary
or received or retained any funds in violation of any law, rule or regulation or
of a character required to be disclosed in the Prospectus;
(ii) the Company is organized and operates in conformity with the
requirements for qualification as a real estate investment trust under the
Internal Revenue Code of 1986, as amended (the "Code"), and the Company's
proposed method of operation will enable it to meet the requirements for
taxation as a real estate investment trust under the Code;
(jj) the Shares have been approved for listing, upon official notice of
issuance, on the American Stock Exchange;
(kk) in connection with this offering, the Company has not offered and
will not offer its Common Shares or any other securities convertible into or
exchangeable or exercisable for Common Shares in a manner in violation of the
Securities Act or the Securities Act Regulations; the Company has not
distributed and will not distribute any Prospectus or other offering material
in connection with the offer and sale of the Shares, except as contemplated
herein;
(11) to the best knowledge of the Company, each of the properties owned
by the Company or any Subsidiary is in compliance with all presently applicable
provisions of the Americans with Disabilities Act, except for any failures to
comply which would not, singly or in the aggregate, result in a material
adverse change in the assets, operations, business, prospects or condition
(financial or otherwise) of the Company and the Subsidiaries, taken as a whole;
(mm) neither the Company nor any of the Subsidiaries is, or solely as a
result of transactions contemplated hereby and the application of the proceeds
from the sale of the Shares, will become an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended (the "1940 Act");
(nn) the Company has not incurred any liability for any finder's fees
or similar payments in connection with the transactions herein contemplated;
13
(oo) to the Company's knowledge, no general labor problem exists or is
imminent with the employees of the Company or any of its Subsidiaries;
(pp) except for the interests in the Subsidiaries owned by the Company
and the interests disclosed on Schedule III hereto, neither the Company nor any
Subsidiary owns any shares of stock or any other equity securities of any
corporation or has any equity interest in any firm, partnership, association or
other entity; and
(qq) each of the Company and each Subsidiary maintains a system of
internal accounting controls sufficient to provide reasonable assurance that:
(A) transactions are executed in accordance with management's general or
specific authorizations; (B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (C) access to assets
is permitted only in accordance with management's general or specific
authorization; and (D) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
4. Certain Covenants of the Company. The Company hereby covenants with each
Underwriter:
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the securities or
blue sky laws of such states as the Representatives may designate and to
maintain such qualifications in effect as 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);
(b) if, at the time this Agreement is executed and delivered, it is
necessary for a posteffective amendment to the Registration Statement to be
declared effective before the offering of the Shares may commence, the Company
will endeavor to cause such post-effective amendment to become effective as soon
as possible and will advise the Representatives promptly and, if requested by
the Representatives, will confirm such advice in writing, when such
post-effective amendment has become effective;
(c) to prepare the Prospectus in a form approved by the Underwriters and
file such Prospectus with the Commission pursuant to Rule 424(b) within the time
period prescribed by law, on the day following the execution and delivery of
this Agreement and to furnish promptly (and with respect to the initial delivery
of such Prospectus, not later than 10:00 a.m. (New York City time) on the day
following the execution and delivery of this Agreement) to the Underwriters 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 after the
effective date of the Registration Statement) as the Underwriters may reasonably
request for the purposes contemplated by the Securities Act Regulations, which
Prospectus and any amendments or supplements thereto furnished to the
Underwriters will be identical to the version created to be transmitted to the
Commission for filing via EDGAR, except to the extent permitted by Regulation
S-T;
14
(d) to advise the Representatives promptly and (if requested by the
Representatives) to confirm such advice in writing, when the Registration
Statement has become effective and when any post-effective amendment thereto
becomes effective under the Securities Act Regulations;
(e) to advise the Representatives immediately, confirming such advice in
writing, of (i) the receipt of any comments from, or any request by, the
Commission for amendments or supplements to the Registration Statement or
Prospectus or for additional information with respect thereto, or (ii) the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus, or of the suspension of the
qualification of the Shares for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceedings for any of such purposes and, if
the Commission or any other government agency or authority should issue any such
order, to make every reasonable effort to obtain the lifting or removal of such
order as soon as possible; to advise the Representatives promptly of any
proposal to amend or supplement the Registration Statement or Prospectus and to
file no such amendment or supplement to which the Representatives shall
reasonably object in writing;
(f) to file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that may, in the judgment of the Company or the Representatives, be required by
the Securities Act or requested by the Commission; to advise the Representatives
promptly of any proposal to amend or supplement the Registration Statement or
Prospectus and to file no such amendment or supplement to which the
Representatives shall reasonably object in writing;
(g) to furnish to the Underwriters for a period of five years from the
date of this Agreement by any means pursuant to which the Underwriters will
receive a copy thereof, including by electronic transmission, (i) as soon as
available, copies of all annual, quarterly and current reports or other
communications supplied to holders of Common Shares, (ii) as soon as practicable
after the filing thereof, copies of all reports filed by the Company with the
Commission, the NASD or any securities exchange and (iii) such other publicly
available information as the Underwriters may reasonably request regarding the
Company and its Subsidiaries;
(h) to advise the Underwriters promptly during any period of time in
which a Prospectus relating to the Shares is required to be delivered under the
Securities Act Regulations (i) of any material change in the Company's assets,
operations, business, prospects or condition (financial or otherwise) or (ii) of
the happening of any event which would require the making of any change in the
Prospectus then being used so that the Prospectus would not include any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and, during such time,
to prepare and furnish, at the Company's expense, to the Underwriters promptly
such amendments or supplements to the Prospectus as may be necessary to reflect
any such change;
(i) to furnish promptly to the Representatives a signed copy of the
Registration Statement, as initially filed with the Commission, and of all
amendments or supplements thereto including all exhibits filed therewith) and
such number of conformed copies of the foregoing as the Underwriters may
reasonably request;
15
(j) to furnish to the Underwriters, not less than two business days
before filing with the Commission, subsequent to the effective date of the
Prospectus and during any period of time in which a prospectus relating to the
Shares is required to be delivered under the Securities Act Regulations, a copy
of any document proposed to be filed with the Commission pursuant to Section 13,
14, or 15(d) of the Exchange Act;
(k) to apply the net proceeds of the sale of the Shares substantially in
accordance with its statements under the caption "Use of Proceeds" in the
Prospectus;
(1) to make generally available to its security holders as soon as
practicable, but in any event not later than forty-five days following the end
of the fiscal quarter first occurring after the first anniversary of the
effective date of the Registration Statement, an earnings statement complying
with the provisions of Section 11 (a) of the Securities Act (in form, at the
option of the Company, complying with the provisions of Rule 158 of the
Securities Act Regulations) covering a period of at least 12 months after the
effective date of the Registration Statement;
(m) to use its best efforts to effect and maintain the listing of the
Shares on the American Stock Exchange and to file with the American Stock
Exchange all documents and notices required by the American Stock Exchange of
companies that have securities that are listed on the American Stock Exchange;
(n) except for the granting of options in the ordinary course of
business pursuant to the Company's 1989 Stock Option Plan, 1996 Stock Option
Plan or the 2003 Incentive Plan (not to exceed an aggregate of 85,000 options),
to refrain during a period of 90 days from the date of the Prospectus, without
the prior written consent of the Representatives, from (i) offering, pledging,
selling, contracting to sell, selling any option or contract to purchase,
purchasing any option or contract to sell, granting any option for the sale of,
or otherwise disposing of or transferring, directly or indirectly, any Common
Shares or any securities convertible into or exercisable or exchangeable for
Common Shares, or filing any registration statement under the Securities Act
with respect to any of the foregoing or (ii) entering into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Shares, whether
any such swap or transaction described in clause (i) or (ii) above is to be
settled by delivery of Common Shares or such other securities, in cash or
otherwise; the foregoing sentence shall not apply to (A) the Shares to be sold
hereunder, (B) any Common Shares issued by the Company upon the exercise of an
option outstanding on the date hereof or upon the exercise of any option granted
in the ordinary course of business as provided herein, or (C) any Common Shares
issuable upon the conversion of any shares of Preferred Stock outstanding on the
date hereof;
(o) the Company will maintain a transfer agent and, if necessary under
the jurisdiction of formation of the Company, a registrar (which may be the
same entity as the transfer agent) for its Common Shares;
16
(p) the Company will use its best efforts to continue to meet the
requirements to qualify as a real estate investment trust under the Code;
(q) the Company will comply with all of the provisions of any
undertakings in the Registration Statement;
(r) the Company and the Subsidiaries will conduct their affairs in such
a manner so as to ensure that neither the Company nor any Subsidiary will be an
"investment company" or an entity "controlled" by an investment company within
the meaning of the 1940 Act;
(s) if at any time during the 30-day period after the execution of this
Agreement, any rumor, publication or event relating to or affecting the Company
shall occur as a result of which in the Representatives' reasonable opinion the
market price of the Common Shares has been or is likely to be materially
affected (regardless of whether such rumor, publication or event necessitates a
supplement to or amendment of the Prospectus) and after written notice from the
Representatives advising the Company to the effect set forth above, to forthwith
prepare, consult with the Representatives concerning the substance of, and
disseminate a press release or other public statement, in compliance with the
Securities Act, the Securities Act Regulations and other applicable laws and
reasonably satisfactory to the Representatives, responding to or commenting on
such rumor, publication or event;
(t) to maintain a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in accordance
with management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences;
(u) for a period of 90 days after the date hereof, neither the Company
nor any Subsidiary will, directly or indirectly: (i) take any action designed to
cause or to result in, or that has constituted or which might reasonably be
expected to constitute, the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Shares; or
(ii)(A) sell, bid for, purchase, or pay anyone any compensation for soliciting
purchases of, the Shares; or (B) pay or agree to pay to any person any
compensation for soliciting another to purchase any other securities of the
Company; and
(v) the Company will obtain each of the lock-up agreements described in
Section 6(j) hereof prior to the Closing Time.
5. Payment of Expenses.
(a) The Company agrees to pay all costs and expenses incident to the
performance of the Company's obligations under this Agreement whether or not the
transactions contemplated hereunder are consummated or this Agreement
terminated, including, but not limited to, all fees and expenses of and filing
with the Commission and the NASD; all blue sky fees and expenses, fees and
disbursements of counsel and accountants for the Company, printing costs,
including
17
costs of printing the Prospectus, and any amendments thereto; all underwriting
documents, Blue Sky Memoranda, a reasonable quantity of Prospectuses requested
by the Representatives, and the Company's road show costs and expenses.
(b) If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the transactions contemplated herein.
6. Conditions of the Underwriters' Obligations. The obligations of the
Underwriters to purchase the Shares hereunder are subject to (i) the accuracy of
the representations and warranties on the part of the Company on the date hereof
and at the Closing Time and on each Date of Delivery, as if made on and as of
such date, (ii) the performance by the Company of its obligations, covenants and
agreements hereunder, and (iii) the following further conditions:
(a) The Registration Statement shall have become effective under the
Securities Act and no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to the Underwriters' and their
counsel's reasonable satisfaction. A prospectus containing information relating
to the description of the Shares, the specific method of distribution and
similar matters shall have been filed within the prescribed time period, and
prior to the Closing Time with the Commission in accordance with Rule 424(b) (or
any required post-effective amendment providing such information shall have been
filed and declared effective in accordance with the requirements of Rule 430A).
There shall not have come to the Underwriters' attention any facts that would
cause the Underwriters to reasonably believe that the Prospectus, together with
the Prospectus Supplement, at the time it was required to be delivered to
purchasers of the Shares, included an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
therein, in light of the circumstances existing at such time, not misleading.
If, at the time this Agreement is executed and delivered, it is necessary for a
post-effective amendment to the Registration Statement to be declared effective
before the offering of the Shares may commence, such post-effective amendment
shall have become effective not later than 5:30 p.m., New York City time, on the
date hereof, or at such later date and time as shall be consented to in writing
by you; if the Company has elected to rely upon Rule 462(b), the Rule 462(b)
Registration Statement, shall have been declared effective not later than the
earlier of (i) 11:00 a.m., New York City time, on the date on which the
amendment to the Registration Statement originally filed with respect to the
Shares or to the Registration Statement, as the case may be, containing
information regarding the public offering price of the Shares has been filed
with the Commission and (ii) the time confirmations are sent or given as
specified by Rule 462(b) or, with respect to the Registration Statement, such
later time and date as shall have been consented to in writing by you; if
required, the Prospectus and any amendment or supplement thereto shall have been
filed with the Commission in the manner and within the time period required by
Rule 424(b) under the Securities Act;
18
(b) The Company shall furnish to the Underwriters at the Closing Time
and on each Date of Delivery an opinion of McCarter & English, LLP, counsel for
the Company, addressed to the Underwriters and dated the Closing Time and each
Date of Delivery and in form satisfactory to Winston & Strawn LLP, counsel for
the Underwriters, stating that:
(i) the authorized shares of common stock of the Company conform
as to legal matters to the description thereof contained in the
Prospectus and meet the requirements of Form S-3 under the Securities
Act; the Company has an authorized capitalization as set forth in the
Prospectus under the caption "Capitalization" as of the date stated in
such section; the outstanding shares of common stock or capital stock,
as the case may be, of the Company and the Subsidiaries have been duly
and validly authorized and to such counsel's knowledge issued and are
fully paid and non-assessable; all of the authorized and validly issued
shares of capital stock of, or other equity interests in the
Subsidiaries, as the case may be, are directly or indirectly owned of
record by the Company; to such counsel's knowledge except as disclosed
in the Prospectus, there are no authorized and validly issued (A)
securities or obligations of the Company or any of the Subsidiaries
convertible into or exchangeable for any shares of common stock of the
Company or any capital stock or interests in any such Subsidiary or (B)
warrants, rights or options to subscribe for or purchase from the
Company or any such Subsidiary any such shares of common stock, capital
stock, interests or any such convertible or exchangeable securities or
obligations; except as set forth in the Prospectus or contemplated by
this Agreement, to such counsel's knowledge there are no outstanding
obligations of the Company or any such Subsidiary to issue any shares of
common stock, capital stock or interests, any such convertible or
exchangeable securities or obligation, or any such warrants, rights or
options;
(ii) the Company and the Subsidiaries each has been duly formed
or incorporated, as the case may be, and is validly existing and in good
standing under the laws of its respective jurisdiction of formation or
incorporation with the requisite corporate power and authority to own
its respective properties except where the failure thereof would not
have a material adverse effect on the Company and to conduct its
respective business as described in the Registration Statement and
Prospectus and, in the case of the Company, to execute and deliver this
Agreement and to consummate the transactions described herein;
(iii) the Company and the Subsidiaries are duly qualified in or
registered by and are in good standing in each jurisdiction specifically
referred to in the Registration Statement and Prospectus as
jurisdictions in which property securing loans proposed to be made or
acquired by the Company is located and in which the failure,
individually or in the aggregate, to be so qualified would have a
material adverse effect on the assets, operations, business, or
condition (financial or otherwise) of the Company and the Subsidiaries
taken as a whole; to such counsel's knowledge, other than the
Subsidiaries and the interests disclosed on Schedule_ III hereto, the
Company does not own, directly or indirectly, any capital stock or other
equity securities of any other corporation or any ownership interest in
any limited liability company, partnership, joint venture or other
association;
19
(iv) to such counsel's knowledge, except as disclosed in the
Registration Statement and the Prospectus, neither the Company nor any of its
Subsidiaries is in material breach of, or in material default under (nor has any
event occurred which with notice, lapse of time, or both would constitute a
material breach of, or material default under) its respective charter, by-laws,
certificate of limited liability company, agreement of limited liability
company, certificate of limited partnership or partnership agreement, as the
case may be, or in the performance or observation of any obligation, agreement,
covenant, or condition contained in any material license, lease, indenture,
mortgage, deed of trust, deed to secure debt, loan or credit agreement or any
other agreement or instrument to which the Company or any of the Subsidiaries is
a party or by which any of them or their respective properties may be bound or
affected;
(v) the execution, delivery and performance of this Agreement by the
Company and the consummation by the Company of the transactions contemplated
under this Agreement do not and will not result in the creation or imposition of
any lien, encumbrance, or to such counsel's knowledge, charge or claim upon any
property or assets of the Company or the Subsidiaries, or conflict with, or
result in any breach of, or constitute a default under (nor constitute any event
which with notice, lapse of time, or both would constitute a breach of or
default under), (i) any provisions of the charter, bylaws, certificate of
limited liability company, agreement of limited liability company, certificate
of limited partnership or partnership agreement, as the case may be, of the
Company or any Subsidiary, (ii) to such counsel's knowledge, any provision of
any material license, lease, indenture, mortgage, deed of trust, deed to secure
debt, loan or credit agreement or other agreement or instrument to which the
Company or any Subsidiary is a party or by which any of them or their respective
properties may be bound or affected, or (iii) to such counsel's knowledge, any
law or regulation or any decree, judgment or order applicable to the Company or
any Subsidiary (other than State and foreign securities or blue sky laws and the
rules and regulations of the NASD, as to which counsel need express no opinion,
or the Federal securities laws, as to which counsel need express only that
nothing has come to its attention to lead it to believe that such a violation
has or will occur);
(vi) the Company has full legal right, power and authority to enter
into and perform this Agreement and to consummate the transactions contemplated
herein; 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 as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally, and by general principles of equity, and except that
enforceability of the indemnification and contribution provisions set forth in
Section 9 hereof may be limited by the Federal or state securities laws of the
United States or public policy underlying such laws;
(vii) no approval, authorization, consent or order of or filing with
any Federal or state governmental or regulatory commission, board, body,
authority or agency is required in connection with the execution, delivery and
performance of this Agreement or the consummation of the transactions
contemplated hereby by the Company, or the sale and delivery of the Shares by
the Company as contemplated hereby, other than such as
20
have been obtained or made under the Securities Act or the Exchange Act and such
approvals as have been obtained in connection with the listing of the Shares on
the American Stock Exchange and except that such counsel need express no opinion
as to any necessary qualification under the state securities or blue sky laws of
the various jurisdictions in which the Shares are being offered by the
Underwriters or any approval of the underwriting terms and arrangements by the
NASD;
(viii) to such counsel's knowledge, each of the Company and the
Subsidiaries has all necessary licenses, authorizations, consents and approvals
and has made all necessary filings required under any Federal, state or local
law, regulation or rule, and has obtained all necessary authorizations, consents
and approvals from other persons, required to conduct their respective
businesses, as described in the Registration Statement and the Prospectus,
except to the extent that any failure to have such licenses, authorizations,
consents and approvals, to make such filings or have any such authorizations,
consents or approvals would not, individually or in the aggregate, have a
material adverse effect on the assets, operations, business or condition
(financial or otherwise) of the Company and the Subsidiaries, taken as a whole;
to such counsel's knowledge, neither the Company nor any of the Subsidiaries is
in violation of, in default under, or has received any notice regarding a
possible violation, default or revocation of any such license, authorization,
consent or approval or any Federal, state, local or foreign law, regulation or
decree, order or judgment applicable to the Company or any of the Subsidiaries,
the effect of which could be material and adverse to the assets, operations,
business or condition (financial or otherwise) of the Company and the
Subsidiaries taken as a whole;
(ix) the Shares have been duly authorized and, when the Shares have
been issued and duly delivered against payment therefor as contemplated by this
Agreement, the Shares will be validly issued, fully paid and nonassessable, will
have been issued in compliance with all Federal securities laws, to the
knowledge of such counsel, and, except for any action that may have been taken
by the holder thereof, free and clear of any pledge, lien, encumbrance, security
interest, or other claim;
(x) the issuance and sale of the Shares by the Company will not violate
any preemptive rights or other rights to subscribe for or purchase securities,
is not subject to preemptive or other similar rights arising by operation of
law, under the charter or bylaws of the Company under any agreement known to
such counsel to which the Company or any of the Subsidiaries is a party or, to
such counsel's knowledge, otherwise;
(xi) to such counsel's knowledge, there are no persons with
registration or other similar rights to have any securities registered pursuant
to the Registration Statement or otherwise registered by the Company under the
Securities Act;
(xii) the form of certificate used to evidence the Shares complies with
all applicable statutory requirements, with any applicable requirements of the
charter and bylaws of the Company and the requirements of the American Stock
Exchange;
21
(xiii) based upon the verbal advice of the a representative of the
Securities and Exchange Commission the Registration Statement has become
effective under the Securities 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 such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has been issued and,
to such counsel's knowledge, no proceedings with respect thereto have been
commenced or threatened;
(xiv) as of the effective date of the Registration Statement, the
Registration Statement, any Rule 462(b) Registration Statement and the
Prospectus (except as to the financial statements and other financial and
statistical data contained therein, as to which such counsel need express no
opinion) complied as to form in all material respects with the requirements of
the Securities Act and the Securities Act Regulations;
(xv) the statements under the captions "Our Company," "Market Price and
Dividends on our Common Stock," "Additional Risk Factor," "Description of
Securities," "Risk Factors" and "Certain Federal Income Tax Considerations," in
the Registration Statement and the Prospectus, insofar as such statements
constitute a summary of the legal matters, documents and proceedings referred to
therein, constitute accurate summaries thereof in all material respects;
(xvi) the Shares have been approved for listing on the American Stock
Exchange;
(xvii) to such counsel's knowledge, there are no actions, suits or
proceedings, inquiries, or investigations pending or threatened against the
Company or any of the Subsidiaries or any of their respective officers and
directors or to which the properties, assets or rights of the Company or any of
its Subsidiaries are subject, at law or in equity, before or by any Federal,
state, local or foreign governmental or regulatory commission, board, body,
authority, arbitration panel or agency that are required to be described in the
Prospectus but are not so described;
(xviii) to such counsel's knowledge, there are no contracts or documents
of a character that are required to be filed as exhibits to the Registration
Statement or to be described, summarized or incorporated by reference in the
Prospectus which have not been so filed, described, summarized or incorporated;
and each filing incorporated by reference or deemed to be incorporated by
reference in the Registration Statement and in the Prospectus, when each became
effective or was filed with the Commission, as the case may be, conformed in all
material respects to the requirements of the Securities Act or the Exchange Act,
as applicable, and the Securities Act Regulations and the Exchange Act
Regulations; and
(xix) neither the Company nor any of the Subsidiaries is, or solely as a
result of the transactions contemplated hereby and the application of the
proceeds from the sale of the Shares as described in the Registration Statement
and the Prospectus under the caption "Use of Proceeds," will become an
"investment company" or a company "controlled" by an "investment company" within
the meaning of the 1940 Act.
22
In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Company, independent
public accountants of the Company and Underwriters at which the contents of the
Registration Statement and Prospectus were discussed and, although such counsel
is not passing upon and does not assume responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement or Prospectus (except as and to the extent stated in subparagraphs
(i), (xiv) and (xv) above), nothing has caused them to believe that the
Registration Statement as of its effective date, and as of the date of such
counsel's opinion, contained or contains any untrue statement of a material fact
or omitted or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, or that the Preliminary
Prospectus or the Prospectus, as of their respective issue dates and as of the
date of such counsel's opinion, contained or contains any untrue statement of a
material fact or omitted or omits to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (it being understood
that, in each case, such counsel need express no view with respect to the
financial statements and other financial and statistical data included in the
Registration Statement, Preliminary Prospectus or Prospectus).
(c) The Representatives shall have received from Ernst & Young LLP
letters dated, respectively, as of the date of this Agreement, the Closing Time
and each Date of Delivery, as the case may be, addressed to the Representatives
as representative of the Underwriters and in form and substance satisfactory to
the Representatives.
(d) The Underwriters shall have received at the Closing Time and on
each Date of Delivery the favorable opinion of Winston & Strawn LLP, dated the
Closing Time or such Date of Delivery, addressed to the Representatives and in
form and substance satisfactory to the Representatives.
(e) No amendment or supplement to the Registration Statement or
Prospectus shall have been filed to which the Underwriters shall have objected
in writing.
(f) Prior to the Closing Time and each Date of Delivery (i) no stop
order suspending the effectiveness of the Registration Statement or any order
preventing or suspending the use of any Preliminary Prospectus or Prospectus
shall have been issued by the Commission, and no suspension of the qualification
of the Shares for offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes, shall have occurred;
and (ii) from the time the Registration Statement was declared effective up to
and including the Closing Time or Date of Delivery, as applicable, the
Registration Statement 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 the Prospectus shall not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
(g) Between the time of execution of this Agreement and the Closing
Time or the relevant Date of Delivery (i) no material and unfavorable change in
the assets, operations, business, prospects or condition (financial or
otherwise) of the Company and its Subsidiaries
23
taken as a whole shall occur or become known (whether or not arising in the
ordinary course of business), (ii) no transaction which is material and outside
of the ordinary course of business of the Company shall have been entered into
by the Company or any of the Subsidiaries, (iii) neither the Company nor any
Subsidiary has incurred any obligation, direct or contingent, that is material
to the Company and the Subsidiaries taken as a whole, except obligations
incurred in the ordinary course of business, (iv) there has not been any change
in the capital stock or outstanding indebtedness of the Company or the
Subsidiaries that is material to the Company and the Subsidiaries taken as a
whole or (v) neither the Company nor any Subsidiary has sustained any loss or
damage (whether or not insured) to the property of the Company or such
Subsidiary which could have a material adverse effect on the assets, operations,
business, prospects or condition (financial or otherwise) of the Company and its
Subsidiaries taken as a whole.
(h) At the Closing Time, the Shares shall have been approved for listing
on the American Stock Exchange, subject to official notice of issuance.
(i) The NASD shall have stated that it will raise no objection with
respect to the fairness and reasonableness of the underwriting terms and
arrangements.
(j) The Representatives shall have received letters (each, a "Lock-up
Agreement") from each person listed on Schedule IV hereto, in form and substance
satisfactory to the Representatives, confirming that for a period of 90 days
after the Closing Time, such persons will not directly or indirectly (i) offer,
pledge to secure any obligation due on or within 90 days after the Closing Time,
sell, contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option for the sale of, or otherwise
dispose of or transfer (other than a disposition or transfer pursuant to which
the acquiror or transferee is subject to the restrictions on disposition and
transfer set forth in this Section 6(j) to the same extent as such stockholder
delivering a letter hereunder), directly or indirectly, any Common Shares (other
than by participating as selling stockholders in a registered offering of Common
Shares offered by the Company with the consent of the Representatives) or any
securities convertible into or exercisable or exchangeable for Common Shares or
(ii) enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic consequence
of ownership of the Common Shares, whether any such swap or transaction
described in clause (i) or (ii) above is to be settled by delivery of Common
Shares or such other securities, in cash or otherwise, without the prior written
consent of the Representatives, which consent may be withheld at the sole
discretion of the Representatives.
(k) The Company will, at the Closing Time and on each Date of Delivery,
deliver to the Underwriters a certificate of two principal executive officers to
the effect that the representations and warranties of the Company set forth in
this Agreement and the conditions set forth in paragraphs (f), (g), (h) and (n)
have been met and are true and correct as of such date.
(1) The Company shall have furnished to the Underwriters such other
documents and certificates or other information, including with respect to the
accuracy and completeness of any statement in the Registration Statement and the
Prospectus, the representations, warranties and statements of the Company
contained herein, the performance by the Company of its covenants contained
herein, and the fulfillment of any conditions contained herein, as of the
Closing Time or any Date of Delivery, as the Underwriters may reasonably
request.
24
(m) All filings with the Commission required by Rule 424 under the
Securities Act shall have been made within the applicable time period prescribed
for such filing by such Rule.
(n) The Company shall perform such of its obligations and satisfy all
conditions under this Agreement that are to be performed or satisfied by the
terms hereof at or before the Closing Time or the relevant Date of Delivery.
The several obligations of the Underwriters to purchase Shares hereunder
are also subject to the delivery to the Representatives on the relevant Date of
Delivery of such documents as the Representatives may reasonably request with
respect to the good standing of the Company, the due authorization and issuance
of the Shares and other matters related to the issuance of the Shares.
7. Termination. The obligations of the several Underwriters hereunder shall be
subject to termination in the absolute discretion of the Representatives, at any
time prior to the Closing Time or any Date of Delivery, (i) if any of the
conditions specified in Section 6 shall not have been fulfilled when and as
required by this Agreement to be fulfilled, or (ii) if there has been since the
respective dates as of which information is given in the Registration Statement,
any material adverse change, or any development involving a prospective material
adverse change, in or affecting the assets, operations, business, prospects or
condition (financial or otherwise) of the Company and the Subsidiaries taken as
a whole, whether or not arising in the ordinary course of business, or (iii) if
there has occurred outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic, political or other
conditions the effect of which on the financial markets of the United States is
such as to make it, in the judgment of the Representatives, impracticable to
market or deliver the Shares or enforce contracts for the sale of the Shares, or
(iv) if trading in any securities of the Company has been suspended by the
Commission or by the American Stock Exchange or if trading generally on the New
York Stock Exchange, the American Stock Exchange or in the Nasdaq
over-the-counter market has been suspended (including automatic halt in trading
pursuant to market-decline triggers other than those in which solely program
trading is temporarily halted), or limitations on prices for trading (other than
limitations on hours or numbers of days of trading) have been fixed, or maximum
ranges for prices for securities have been required, by such exchange or the
NASD or by order of the Commission or any other governmental authority, or (v)
if there has been any downgrading in the rating of any of the Company's debt
securities or preferred stock by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Securities Act),
or (vi) any Federal or state statute, regulation, rule or order of any court or
other governmental authority has been enacted, published, decreed or otherwise
promulgated which in the reasonable opinion of the Representatives has a
material adverse affect or will have a material adverse affect on the assets,
operations, business, prospects or condition (financial or otherwise) of the
Company, or (vii) any action has been taken by any Federal, state or local
government or agency in respect of its monetary or fiscal affairs which in the
reasonable opinion of the Representatives has a material adverse effect on the
securities markets in the United States, or (viii) in the case of any of the
events specified in clauses (i) through (vii), such event, singly or together
with any other such events, makes it, in the judgment of the Representatives,
impracticable to market or deliver the Shares on the terms and in the manner
contemplated in the Prospectus.
25
If the Representatives elect to terminate this Agreement as provided in
this Section 7, the Company and the Underwriters shall be notified promptly by
telephone, promptly confirmed by facsimile.
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 in all material respects 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 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. If any Underwriter shall default at
the Closing Time or on a Date of Delivery in its obligation to take up and pay
for the Shares to be purchased by it under this Agreement on such date, the
Representatives shall have the right, within 36 hours after such default, to
make arrangements for one or more of the non-defaulting Underwriters, or any
other underwriters, to purchase all, but not less than all, of the Shares which
such Underwriter shall have agreed but failed to take up and pay for (the
"Defaulted Shares"). Absent the completion of such arrangements within such 36
hour period, (i) if the total number of Defaulted Shares does not exceed 10% of
the total number of Shares to be purchased on such date, each non-defaulting
Underwriter shall take up and pay for (in addition to the number of Shares which
it is otherwise obligated to purchase on such date pursuant to this Agreement)
the portion of the total number of Shares agreed to be purchased by the
defaulting Underwriter on such date in the proportion that its underwriting
obligations hereunder bears to the underwriting obligations of all
non-defaulting Underwriters; and (ii) if the total number of Defaulted Shares
exceeds 10% of such total, the Representatives may terminate this Agreement by
notice to the Company, without liability to any non-defaulting Underwriter,
except that the provisions of Sections 5 and 9 shall at all times be effective
and survive such termination.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that it will
not sell any Shares hereunder on such date unless all of the Shares to be
purchased on such date are purchased on such date by the Underwriters (or by
substituted Underwriters selected by the Representatives with the approval of
the Company or selected by the Company with the approval of the
Representatives).
If a new Underwriter or Underwriters are substituted for a defaulting
Underwriter in accordance with the foregoing provision, the Company or the
non-defaulting Underwriters shall have the right to postpone the Closing Time or
the relevant Date of Delivery 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 the like effect as
if such substituted Underwriter had originally been named in this Agreement.
26
9. Indemnity and Contribution by the Company and the Underwriters.
(a) The Company agrees to indemnify, defend and hold harmless each
Underwriter and any person who controls any Underwriter within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act from and
against any loss, expense, liability, damage or claim (including the reasonable
cost of investigation) which, jointly or severally, any such Underwriter or
controlling person may incur under the Securities Act, the Exchange Act or
otherwise, insofar as such loss, expense, liability, damage or claim arises out
of or is based upon:
(i) any untrue statement or alleged untrue statement made
by the Company in Section 3 of this Agreement;
(ii) any untrue statement or alleged untrue statement of a
material fact contained in: (A) the Registration Statement or any
amendment thereto, any Preliminary Prospectus or the Prospectus or any
amendment or supplement thereto and including any Rule 462(b)
Registration Statement; or (B) any application or other document, or any
amendment or supplement thereto, executed by the Company or any
Subsidiary or based upon written information furnished by or on behalf
of the Company or any Subsidiary filed in any jurisdiction in order to
qualify the Shares under the securities or blue sky laws thereof or
filed with the Commission or any securities association or securities
exchange (each an "Application");
(iii) any omission or alleged omission to state in any such
Registration Statement or any amendment thereto, a material fact
required to be stated therein or necessary to make the statements made
therein not misleading, or in any such Preliminary Prospectus or
Prospectus, or any amendment or supplement thereto, or any Application a
material fact required to be stated therein or necessary to make the
statements made therein, in the light of the circumstances under which
they were made, not misleading; or
(iv) any untrue statement or alleged untrue statement of any
material fact contained in any audio or visual materials prepared,
approved or used by the Company in connection with the marketing of the
Shares, including without limitation, slides, videos, films and tape
recordings;
Except insofar as any such loss, expense, liability, damage or claim
under this Section 9(a) arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission of a material fact
contained in and in conformity with information furnished in writing by the
Underwriters through the Representatives to the Company expressly for use in
such Registration Statement, Preliminary Prospectus, Prospectus, or Application
(as set forth in subsection (b) below); provided, however, that the indemnity
agreement contained in this subsection (a) with respect to the Preliminary
Prospectus or the Prospectus shall not inure to the benefit of an Underwriter
(or to the benefit of any person controlling such Underwriter) with respect to
any person asserting any such loss, expense, liability, damage or claim which is
the subject thereof if the Prospectus or any supplement thereto prepared with
the consent of the Representatives and furnished to the Underwriters prior to
the Closing Time corrected any such alleged untrue statement or omission and if
such Underwriter failed to send or give a copy of the Prospectus or supplement
thereto to such person at or prior to the written confirmation of the sale of
Shares to such person, unless such failure resulted from noncompliance by the
Company with Section 4(a) of this Agreement.
27
If any action is brought against an Underwriter or controlling person in
respect of which indemnity may be sought against the Company pursuant to this
Section 9(a), such Underwriter shall promptly notify the Company in writing of
the institution of such action and the Company shall assume the defense of such
action, including the employment of counsel and payment of expenses, provided,
however, that any failure or delay to so notify the Company will not relieve the
Company of any obligation hereunder, except to the extent that its ability to
defend is actually impaired by such failure or delay. Such Underwriter or
controlling 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 such controlling person unless the employment of such
counsel shall have been authorized in writing by the Company in connection with
the defense of such action or the Company shall not have employed counsel to
have charge of the defense of such action within a reasonable time or such
indemnified party or parties shall have reasonably concluded (based on the
advice of counsel) that there may be defenses available to it or them which are
different from or additional to those available to the Company and which counsel
to the Underwriter believes may present a conflict for counsel representing the
Company and the Underwriter (in which case the Company shall not have the right
to direct the defense of such action 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 firm of attorneys
for the Underwriters or controlling persons in any one action or series of
related actions in the same jurisdiction representing the indemnified parties
who are parties to such action). Anything in this paragraph to the contrary
notwithstanding, the Company shall not be liable for any settlement of any such
claim or action effected without its written consent.
(b) Each Underwriter agrees, severally and not jointly, to indemnify,
defend and hold harmless the Company, the Subsidiaries, their trustees and
directors, the officers that signed the Registration Statement and any person
who controls the Company or any Subsidiary within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act from and against any loss,
expense, liability, damage or claim (including the reasonable cost of
investigation) which, jointly or severally, the Company or any such person may
incur under the Securities Act, the Exchange Act or otherwise, insofar as such
loss, expense, liability, damage 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 such Underwriter through
the Representatives to the Company expressly for use 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 either in the
Registration Statement or Prospectus or necessary to make such information, in
the light of the circumstances under which made, not misleading. The statements
set forth under the caption "Underwriting" regarding (i) concessions to dealers
in connection with the sale of Shares and (ii) stabilizing in the Preliminary
Prospectus and the Prospectus (to the extent such statements relate to the
Underwriters) constitute the only information furnished by or on behalf of any
Underwriter through the Representatives to the Company for purposes of Section
3(j) and this Section 9.
If any action 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, the
28
Company or such person shall promptly notify the Representatives in writing of
the institution of such action and the Representatives, on behalf of the
Underwriters, shall assume the defense of such action, including the employment
of counsel and payment of expenses. 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 the
Representatives in connection with the defense of such action or the
Representatives shall not have employed counsel to have charge of the defense of
such action within a reasonable time or such indemnified party or parties shall
have reasonably concluded (based on the advice of counsel) that there may be
defenses available to it or them which are different from or additional to those
available to the Underwriters (in which case the Representatives shall not have
the right to direct the defense of such action on behalf of the indemnified
party or parties), in any of which events such fees and expenses shall be borne
by such Underwriter and paid as incurred (it being understood, however, that the
Underwriters shall not be liable for the expenses of more than one separate firm
of attorneys in any one action or series of related actions in the same
jurisdiction representing the indemnified parties who are parties to such
action). Anything in this paragraph to the contrary notwithstanding, no
Underwriter shall be liable for any settlement of any such claim or action
effected without the written consent of the Representatives.
(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, expenses, liabilities, damages 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, expenses, liabilities, damages 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 Shares or (ii) if (but only 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, expenses, liabilities, damages 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 proportion as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses) received
by the Company bear to the underwriting discounts and commissions received by
the Underwriters. 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,
claims, damages and liabilities referred to above shall be deemed to include any
legal or other fees or expenses reasonably incurred by such party in connection
with investigating or defending any claim or action.
(d) The Company, on the one hand, and the Underwriters, on the other,
agree that it would not be just and equitable if contribution pursuant to this
Section 9 were determined by pro
29
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in subsection (c)(i) and, if applicable
(ii), above. Notwithstanding the provisions of this Section 9, no Underwriter
shall be required to contribute any amount in excess of the underwriting
discounts and commissions applicable to the Shares purchased by such
Underwriter. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 9 are several in proportion to their respective underwriting commitments
and not joint.
10. Survival. The indemnity and contribution agreements contained in Section 9
and the covenants, warranties and representations of the Company and the
Subsidiaries contained in Sections 3, 4 and 5 of this Agreement shall remain in
full force and effect regardless of any investigation made by or on behalf of
any Underwriter, or any person who controls any Underwriter within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act, or by or
on behalf of the Company, the Subsidiaries, their trustees or directors and
officers or any person who controls the Company, any Subsidiary within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
and shall survive any termination of this Agreement or the sale and delivery of
the Shares. The Company and each Underwriter agree promptly to notify the others
of the commencement of any litigation or proceeding against it and, in the case
of the Company, against any of the Company's officers and directors, in
connection with the sale and delivery of the Shares, or in connection with the
Registration Statement or Prospectus.
11. 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 to Friedman,
Billings, Ramsey & Co., Inc., 1001 19th Street North, Arlington, Virginia 22209,
Attention: Syndicate Department; and if to the Company, shall be sufficient in
all respects if delivered to the Company at the offices of the Company at 60
Cutter Mill Road, Great Neck, New York 11021.
12. Governing Law; Consent to Jurisdiction; Headings. THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. The parties hereto agree
to be subject to, and hereby irrevocably submit to, the nonexclusive
jurisdiction of any United States Federal or Virginia state court sitting in
Alexandria, Virginia, in respect of any suit, action or proceeding arising out
of or relating to this Agreement or the transactions contemplated herein, and
irrevocably agree that all claims in respect of any such suit, action or
proceeding may be heard and determined in any such court. Each of the parties
hereto irrevocably waives, to the fullest extent permitted by applicable law,
any objection to the laying of the venue of any such suit, action or proceeding
brought in any such court and any claim that any such suit, action or proceeding
has been brought in an inconvenient forum. The section headings in this
Agreement have been inserted as a matter of convenience of reference and are not
a part of this Agreement.
30
13. Parties in Interest. The Agreement herein set forth has been and is made
solely for the benefit of the Underwriters, the Company and the controlling
persons, directors and officers referred to in Sections 9 and 10 hereof, and
their respective successors, assigns, 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 counterparts
which together shall constitute one and the same agreement among the parties.
[Signature pages follow]
31
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 Agreement shall constitute a binding agreement among
the Company and the Underwriters.
Very truly yours,
ONE LIBERTY PROPERTIES, INC.
By: /s/ Jeffrey Fishman
-------------------------------
Jeffrey Fishman
President and CEO
Accepted and agreed to as of the date first
above written:
FRIEDMAN, BILLINGS, RAMSEY & CO., INC. FERRIS, BAKER WATTS, INCORPORATED
STIFEL, NICOLAUS & COMPANY, INCORPORATED
BY: FRIEDMAN, BILLINGS, RAMSEY & CO,, INC.
By; James R. Kleeblatt
Its: Senior Managing Director
For themselves and as Representatives
of the other Underwriters named on
Schedule I hereto.
[GRAPHIC OMITTED][GRAPHIC OMITTED]
Schedule I
Number of Initial
Underwriter Shares to be Purchased
Friedman, Billings, Ramsey & Co., Inc. 2,275,000
Ferris, Baker Watts, Incorporated 650,000
Stifel, Nicolaus & Company, Incorporated 325,000
---------
Total 3,250,000
34
Schedule II
SUBSIDIARIES OF THE COMPANY
State of
Company Organization
OLP Action, Inc. Michigan
OLP Arby's II South Carolina
OLP Iowa, Inc. Delaware
OLP Texas, Inc. Texas
OLP-TSA Georgia, Inc. Georgia
OLP Dixie Drive Houston, Inc. Texas
OLP Greenwood Village, Colorado, Inc. Colorado
OLP Ft. Myers, Inc. Florida
OLP Rabro Drive Corp. New York
OLP Chattanooga, Inc. Tennessee
OLP Columbus, Inc. Ohio
OLP Mesquite, Inc. Texas
OLP South Highway Houston, Inc. Texas
OLP Selden, Inc. New York
OLP Palm Beach, Inc. Florida
OLP New Hyde Park, Inc. New York
OLP Champaign, Inc. Illinois
OLP Batavia, Inc. New York
OLP Hanover PA, Inc. Pennsylvania
OLP Grand Rapids, Inc. Michigan
OLP El Paso, Inc. Texas
OLP Plano, Inc. Texas
OLP Hamilton, Inc. New York
OLP Hauppauge, LLC New York
OLP Ronkonkoma, LLC New York
OLP Plano 1, L.P. Texas
OLP El Paso 1, L.P. Texas
OLP Plano, LLC Delaware
OLP El Paso 1, LLC Delaware
OLP Hanover 1, LLC Pennsylvania
OLP Theatres, LLC Delaware
OLP Norwalk, LLC Delaware
Elpans, LLC New York
Zero City, LLC Delaware
OLP Holdings, LLC Delaware
OLP Austell, LLC Delaware
OLP Southlake, LLC Delaware
OLP Centerreach, LLC New York
OLP Beavercreek, LLC Delaware
Chattanooga Realty Acquisition, LLC Delaware
EXHIBIT 99.1
Schedule III
INVESTMENTS IN SECURITIES
SECURITY NUMBER OF
SHARES
BARNES & NOBLE, INC. 250
COMMERCIAL NET LEASE REALTY, INC. 175
CRESCENT REAL ESTATE EQUITY TRUST 125
ENTERTAINMENT PROPERTIES TRUST 2,625
GART SPORTS CO 100
HELIG MEYERS CO 50
HOLLYWOOD ENTERTAINMENT CORPORATION 250
JUST FOR FEET 50
K MART CORPORATION 50
KROGER COMPANY 200
MAY DEPARTMENT STORES 95
LAQUINTA PPTYS-MEDITRUST CORP PAIRED ST 350
PAYLESS SHOESOURCE, INC. 50
SPORTS AUTHORITY INC. 50
ULTIMATE ELECTRONICS INC. 50
USX-MARATHON GROUP INC. 25
WINSTON HOTELS, INC. 125
TOYS R US, INC. 81
NEW PLAN EXCEL REALTY TRUST INC. 60
NEW PLAN EXCEL LEGACY CORP. 50
REALTY INCOME CORP. 100
ACTION AUTO STORES, INC. 100
ERNST HOME CENTER 100
BRT REALTY TRUST 30,048
BARNES & NOBLE, INC. 250
COMMERCIAL NET LEASE REALTY, INC. 175
Schedule IV
PERSONS SUBJECT TO LOCK-UP AGREEMENTS
NAME SHARES
Fredric H. Gould 243,987
Jeffrey Gould 116,646
Matthew Gould 146,134
Jeffrey Fishman 13,200
Israel Rosenzweig 71,670
David W. Kalish 17,875
Simeon Brinberg 11,433
Mark H. Lundy 8,300
Seth D. Kobay 0
Karen Dunleavy 200
Lawrence G. Ricketts 900
Joseph A. Amato 0
Charles Biederman 5,000
James J. Bums 2,000
Arthur Hurand 45,976
Marshall Rose 156,769
Gould Investors L.P. 542,397
Contact: Mark Lundy
Vice President and Secretary
516-466-3100
FOR IMMEDIATE RELEASE
One Liberty Properties, Inc. Prices Public Offering
Great Neck, New York, October 27, 2003 - One Liberty Properties, Inc. (AMEX:
OLP, OLP Pr) today announced that is has priced its public offering of 3,250,000
shares of common stock at an offering price of $18.25 per share.
A registration statement relating to these securities was filed and
declared effective by the Securities and Exchange Commission. The managing
underwriters for the offering are Friedman, Billings, Ramsey & Co., Inc.,
Ferris, Baker Watts, Incorporated and Stifel, Nicolaus & Company, Incorporated.
The offering of these securities will be made only by means of a prospectus.
One Liberty has granted the underwriters an option, exercisable within
30 days of the pricing date, to purchase up to 487,500 additional shares of
common stock to cover over-allotments, if any.
This release shall not constitute an offer to sell or the solicitation
of any offer to buy the securities, nor shall there be any sale of the
securities in any state in which such offer, solicitation, or sale would be
unlawful prior to registration or qualification under the securities laws of
such state. To obtain a copy of the prospectus, contact Friedman, Billings,
Ramsey & Co., Inc., 1001 19th Street North, Arlington, Virginia 22209.
One Liberty is a New York-based REIT that specializes in the
acquisition and ownership of a diverse portfolio of real estate properties under
long term net leases. For more information on One Liberty, please visit our
website at http://www.onelibertyproperties.com.