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EXHIBIT 10.5
$200,000,000(1)
LIBERTY PROPERTY LIMITED PARTNERSHIP
(a Pennsylvania Limited Partnership)
MEDIUM TERM NOTES, SERIES A
DISTRIBUTION AGREEMENT
October 24, 1997
LEHMAN BROTHERS
Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
277 Park Avenue
New York, New York 10172
FIRST CHICAGO CAPITAL MARKETS, INC.
One First National Plaza
Chicago, Illinois 60670
J.P. MORGAN SECURITIES INC.
60 Wall Street
New York, New York 10260
UBS SECURITIES LLC
299 Park Avenue
New York, New York 10171
Dear Sirs:
Liberty Property Trust, a Maryland real estate investment trust (the
"Company"), and Liberty Property Limited Partnership, a Pennsylvania limited
partnership (the "Operating Partnership" and, together with the Company, the
"Transaction Entities"), each wish to confirm as follows its agreement with
Lehman Brothers Inc., Donaldson, Lufkin & Jenrette Securities Corporation, First
Chicago Capital Markets, Inc., J.P. Morgan Securities Inc. and UBS Securities
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(1) Or the U.S. dollar equivalent in certain specified foreign currencies or
currency units.
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LLC (individually, an "Agent" and collectively, the "Agents"), with respect to
the issuance and sale by the Operating Partnership, directly to certain
purchasers, including the Agents, of an aggregate of $200,000,000(1) in gross
proceeds of the Operating Partnership's Medium-Term Notes, Series A (the
"Notes"). The Notes are to be issued from time to time pursuant to an Indenture,
dated as of October 24, 1997, as supplemented by a first Supplemental Indenture,
dated as of October 24, 1997 (together, the "Indenture"), between the Operating
Partnership and The First National Bank of Chicago, as trustee (the "Trustee").
The Notes shall have the maturity ranges, applicable interest rates
or interest rate formulas, specified currencies, issue prices, redemption and
repayment provisions and other terms set forth in the Prospectus referred to in
Section 1(a) as it may be amended or supplemented from time to time, including
any supplement providing for the interest rate, maturity and other terms of any
Note (a "Pricing Supplement"). The Notes will be issued, and the terms thereof
established, from time to time, by the Operating Partnership in accordance with
the Indenture and the Procedures referred to below. This Agreement shall only
apply to sales of the Notes and not to sales of any other securities or
evidences of indebtedness of the Operating Partnership and only on the specific
terms set forth herein.
Subject to the terms and conditions stated herein and to the
reservation by the Operating Partnership of the right to sell its Notes directly
on its own behalf, the Operating Partnership hereby (i) appoints each of the
Agents, on a non-exclusive basis, as the agent of the Operating Partnership for
the purpose of soliciting and receiving offers to purchase Notes from the
Operating Partnership and (ii) agrees that whenever the Operating Partnership
determines to sell Notes directly to an Agent as principal it will enter into a
separate agreement with such Agent (each, a "Purchase Agreement"). Each such
Purchase Agreement, whether oral (in which case such Purchase Agreement shall be
confirmed in writing within one business day of such Purchase Agreement, which
may be by facsimile transmission) or in writing, shall be with respect to such
information (as applicable) as specified in Exhibit C hereto, relating to such
sale in accordance with Section 2(e) hereof.
Capitalized terms used but not otherwise defined herein shall have
the meanings given to those terms in the Prospectus.
1. Representations, Warranties and Agreements of the Transaction
Entities. Each of the Transaction Entities, jointly and severally, represents
and warrants to each Agent, and agrees, as of the date hereof, as of the Closing
Date (defined herein) and as of the times referred to in Sections 6(a) and 6(b)
hereof (the Closing Date and each such time being hereinafter sometimes referred
to as a "Representation Date"), as follows:
(a) A registration statement on Form S-3 (No. 333-22211) (the
"Registration Statement"), and any amendments thereto, with respect
to one or more series of debt securities of the Operating
Partnership, including the Notes, has (i) been prepared by the
Transaction Entities in conformity with the requirements of the
United States Securities Act of 1933, as amended (the "Securities
Act") and the rules and regulations (the "Rules and Regulations") of
the United States Securities and Exchange Commission (the
"Commission")
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thereunder, (ii) been filed with the Commission under the Securities
Act and (iii) become effective under the Securities Act; and the
Indenture has been qualified under the Trust Indenture Act of 1939,
as amended (the "Trust Indenture Act"). Copies of such registration
statement and any amendments thereto have been delivered by the
Operating Partnership to you. As used in this Agreement, "Effective
Time" means, for such registration statement, the date and the time
as of which such registration statement, or the most recent
post-effective amendment thereto, if any, was declared effective by
the Commission; "Effective Date" means, for such registration
statement, the date of the Effective Time; "Registration Statement"
means such registration statement when it became effective under the
Securities Act, and as from time to time amended or supplemented
thereafter (if any post-effective amendment to such registration
statement has been filed with the Commission prior to the execution
and delivery of this Agreement, the time the most recent such
amendment has been declared effective by the Commission), including
any documents incorporated by reference therein at such time and all
information contained in the final prospectus filed with the
Commission pursuant to Rule 424(b) of the Rules and Regulations and
deemed to be a part of such registration statement as of the
Effective Time pursuant to paragraph (b) of Rule 430A of the Rules
and Regulations, and shall include any registration statement filed
pursuant to Rule 462(b) of the Rules and Regulations with respect to
the Registration Statement; "Basic Prospectus" means the prospectus
(including all documents incorporated therein by reference) included
in the Registration Statement; and "Prospectus" means the Basic
Prospectus and any amendments or supplements thereto (including the
applicable Pricing Supplement) relating to the Notes, as filed with
the Commission pursuant to paragraph (b) of Rule 424 of the Rules
and Regulations. Any reference herein to the Registration Statement
or the Prospectus shall be deemed to include the documents
incorporated or deemed to be incorporated by reference therein which
were filed under the Securities and Exchange Act of 1934, as amended
(the "Exchange Act"). Any reference herein to amending or
supplementing the Prospectus shall be deemed to include the filing
of materials incorporated by reference in the Prospectus after the
Closing Date (defined herein) and any reference herein to any
amendment or supplement to the Prospectus shall be deemed to include
any such materials incorporated by reference in the Prospectus after
the Closing Date (defined herein). For purposes of this Agreement,
all references to the Registration Statement, the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to
include the copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval system ("EDGAR").
(b) The Registration Statement conforms in all material
respects, and each Prospectus and any further amendments or
supplements to the Registration Statement or any Prospectus will
conform, when they become effective or are filed with the
Commission, as the case may be, and as of the applicable
Representation Date and at all times during each period during
which, in the opinion of counsel for the Agents, a prospectus
relating to the Notes is required to be delivered under the
Securities Act (each, a "Marketing Period"), in all material
respects to the
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requirements of the Securities Act, the Exchange Act, the Trust
Indenture Act, and the rules and regulations of the Commission under
such Acts, and do not and will not, as of the Effective Date (as to
the Registration Statement and any amendment thereto) and as of the
applicable filing date (as to the Prospectus and any amendment or
supplement thereto), and as of the applicable Representation Date
and at all times during each Marketing Period, 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 (with respect to the Prospectus, in light of
the circumstances under which they were made); provided that no
representation or warranty is made as to information contained in or
omitted from the Registration Statement or the Prospectus in
reliance upon and in conformity with written information furnished
to the Operating Partnership through the Agents by or on behalf of
any Agent specifically for inclusion therein. The Indenture conforms
in all material respects to the requirements of the Trust Indenture
Act and the rules and regulations thereunder; provided, however,
that no representation or warranty is made as to information
contained in or omitted from that part of the Registration Statement
which shall constitute the Statement of Eligibility and
Qualification on Form T-1 under the Trust Indenture Act of the
Trustee under the Indenture. The Prospectus delivered to the Agents
for use in connection with this offering was identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(c) The documents incorporated or deemed to be incorporated by
reference into the Registration Statement or any Prospectus have
been, and will be as of the applicable Representation Date and at
all times during each Marketing Period, prepared by the Operating
Partnership in conformity in all material respects with the
applicable requirements of the Securities Act and the Rules and
Regulations and the Exchange Act and the rules and regulations of
the Commission thereunder; and none of such documents contained, or
will contain as of the applicable Representation Date and at all
times during each Marketing Period, an untrue statement of a
material fact or omitted, or will 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 such documents have been, or will be, as
of the applicable Representation Date and at all times during each
Marketing Period, timely filed as required thereby.
(d) No stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and no
proceeding for that purpose has been instituted or, to the knowledge
of either of the Transaction Entities, threatened by the Commission
or by the state securities authority of any jurisdiction. No order
preventing or suspending the use of the Prospectus has been issued
and no proceeding for that purpose has been instituted or, to the
knowledge of either of the Transaction Entities, after due inquiry
of the Commission,
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threatened by the Commission or by the state securities authority of
any jurisdiction.
(e) The Company has been duly formed and is validly existing
as a real estate investment trust in good standing under the laws of
the State of Maryland, is duly qualified to do business and is in
good standing in each jurisdiction in which its ownership or lease
of property or the conduct of its business requires such
qualification, and has all power and authority necessary to own or
hold its properties, to conduct the business in which it is engaged
and to enter into and perform its obligations under this Agreement.
None of the subsidiaries of the Company (other than the Operating
Partnership, Liberty Property Development Corp. ("Development
Corp."), Liberty Property Development Corp.-II ("Development-II")
and Liberty Special Purpose Corp. ("SP Corp.")) is a "significant
subsidiary," as such term is defined in Rule 405 of the Rules and
Regulations. Except as described in the Prospectus and other than
the Property Affiliates (as defined herein) and the Operating
Partnership, Development Corp., Development-II and SP Corp., the
Company owns no direct or indirect equity interest in any entity,
except for such interests as, in the aggregate, are not material to
the condition, financial or otherwise, or the earnings, assets,
business affairs or business prospects of the Company and its
subsidiaries considered as a single enterprise.
(f) All of the issued shares of beneficial interest of the
Company have been duly and validly authorized and issued, and are
fully paid and non-assessable. The description of the Common Shares
conforms to the description thereof contained in the Prospectus.
Except as disclosed in the Prospectus, no shares of beneficial
interest of the Company are reserved for any purpose and except for
the equity interests in the Operating Partnership ("Units") and the
Operating Partnership's Exchangeable Subordinated Debentures due
2001 (the "Debentures"), there are no outstanding securities
convertible into or exchangeable for any shares of beneficial
interest of the Company. Except for transactions described in the
Prospectus and transactions in connection with stock option and
other benefit plans, there are no outstanding options, rights
(preemptive or otherwise) or warrants to purchase or subscribe for
shares of beneficial interest or any other securities of the
Company.
(g) The Operating Partnership has been duly formed and is
validly existing as a limited partnership in good standing under the
laws of the Commonwealth of Pennsylvania, is duly qualified to do
business and is in good standing as a foreign limited partnership in
each jurisdiction in which its ownership or lease of property or the
conduct of its business requires such qualification, and has all
partnership power and authority necessary to own or hold its
properties, to conduct the business in which it is engaged and to
enter into and perform its obligations under this Agreement. The
Company is the sole general partner of the Operating Partnership.
The agreement of limited partnership of the Operating Partnership,
as amended to date (the "Operating Partnership
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Agreement") is in full force and effect, and the aggregate
percentage interests of the Company and the limited partners in the
Operating Partnership are as set forth in the Prospectus. All of the
Units have been duly and validly authorized and issued, are fully
paid and, to the extent that such interests are owned by the
Company, are owned by the Company free and clear of all liens,
encumbrances, equities or claims.
(h) Development Corp. has been duly organized and is validly
existing as a corporation in good standing under the laws of the
Commonwealth of Pennsylvania, is duly qualified to do business and
is in good standing in each jurisdiction in which its ownership or
lease of property or the conduct of its business requires such
qualification, and has all corporate power and authority necessary
to own or hold its properties and to conduct the business in which
it is engaged. All of the issued and outstanding capital stock of
Development Corp. has been duly authorized and validly issued and is
fully paid and non-assessable, has been offered and sold in
compliance with all applicable laws (including, without limitation,
federal or state securities laws) and all of the capital stock of
Development Corp. owned by the Operating Partnership, as described
in the Prospectus, is owned free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim, restriction or equities.
No shares of capital stock of Development Corp. are reserved for any
purpose, and there are no outstanding securities convertible into or
exchangeable for any capital stock of Development Corp., and no
outstanding options, rights (preemptive or otherwise) or warrants to
purchase or to subscribe for shares of such capital stock or any
other securities of Development Corp.
(i) Development-II has been duly organized and is validly
existing as a corporation in good standing under the laws of the
Commonwealth of Pennsylvania, is duly qualified to do business and
is in good standing in each jurisdiction in which its ownership or
lease of property or the conduct of its business requires such
qualification, and has all corporate power and authority necessary
to own or hold its properties and to conduct the business in which
it is engaged. All of the issued and outstanding capital stock of
Development-II has been duly authorized and validly issued and is
fully paid and non-assessable, has been offered and sold in
compliance with all applicable laws (including, without limitation,
federal or state securities laws) and all of the capital stock of
Development-II owned by the Operating Partnership, as described in
the Prospectus, is owned free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim, restriction or equities.
No shares of capital stock of Development-II are reserved for any
purpose, and there are no outstanding securities convertible into or
exchangeable for any capital stock of Development-II, and no
outstanding options, rights (preemptive or otherwise) or warrants to
purchase or to subscribe for shares of such capital stock or any
other securities of Development-II.
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(j) SP Corp. has been duly organized and is validly existing
as a corporation in good standing under the laws of the Commonwealth
of Pennsylvania, is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which its
ownership or lease of property or the conduct of its business
requires such qualification, and has all corporate power and
authority necessary to own or hold its properties and to conduct the
business in which it is engaged. All of the issued and outstanding
capital stock of SP Corp. has been duly authorized and validly
issued and is fully paid and non-assessable, has been offered and
sold in compliance with all applicable laws (including, without
limitation, federal or state securities laws) and all of the capital
stock of SP Corp. is owned by the Company free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim,
restriction or equities. No shares of capital stock of SP Corp. are
reserved for any purpose, and there are no outstanding securities
convertible into or exchangeable for any capital stock of SP Corp.
and no outstanding options, rights (preemptive or otherwise) or
warrants to purchase or to subscribe for shares of such capital
stock or any other securities of SP Corp.
(k) Each of those certain partnerships, limited liability
companies or other entities holding title to one or more of the
Properties (the "Property Affiliates") are the only entities other
than the Operating Partnership through which the Company and the
Operating Partnership own interests in the Properties. Each of the
Property Affiliates has been duly organized and is validly existing
as a limited partnership, limited liability company or other entity
in good standing under the laws of the jurisdiction in which they
are organized, is duly qualified to do business and is in good
standing as a foreign limited partnership in each jurisdiction in
which its ownership or lease of property or the conduct of its
business requires such qualification, and has all power and
authority necessary to own or hold its properties and to conduct the
business in which it is engaged. Except as set forth in the
Prospectus, all of the ownership interests of each Property
Affiliate have been duly and validly authorized and issued, are
fully paid and non-assessable and all of the ownership interests
owned directly or indirectly by the Company and the Operating
Partnership, as described in the Prospectus, are owned free and
clear of any security interest, mortgage, pledge, lien, encumbrance,
claim, restriction or equities.
(l) The Notes have been validly authorized for issuance and
sale pursuant to this Agreement and, when the terms of the Notes and
of their issue and sale have been duly established in accordance
with the Indenture and this Agreement so as not to violate any
applicable law or agreement or instrument then binding on the
Operating Partnership, and the Notes have been duly executed,
authenticated and delivered against payment therefor as provided in
this Agreement and the Indenture, the Notes will be validly issued
and outstanding, and will constitute valid and legally binding
obligations of the Operating Partnership entitled to the benefits of
the Indenture and enforceable in accordance with their terms and the
terms of the Indenture.
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(m) The Indenture has been duly authorized, executed and
delivered by the Operating Partnership, and constitutes a valid and
binding agreement on the part of the Operating Partnership,
enforceable against the Operating Partnership in accordance with its
terms; the Notes and the Indenture conform in all material respects
to the descriptions thereof contained in each Prospectus.
(n) (A) This Agreement has been duly and validly authorized,
executed and delivered by each of the Transaction Entities, and
assuming due authorization, execution and delivery by each of the
Agents, is a valid and binding agreement of each of the Transaction
Entities, enforceable against the Transaction Entities in accordance
with its terms; and (B) the Operating Partnership Agreement and the
partnership agreement of each Property Affiliate, has been duly and
validly authorized, executed and delivered by the parties thereto
and is a valid and binding agreement of the parties thereto,
enforceable against such parties in accordance with its terms.
(o) The execution, delivery and performance of this Agreement
by each of the Transaction Entities, the execution, delivery and
performance of the Indenture, the Notes, and each applicable
Purchase Agreement, if any, by the Operating Partnership, and the
consummation of the transactions contemplated hereby and thereby
will not conflict with or result in a breach or violation of any of
the terms or provisions of, result in the creation or imposition of
any lien, charge or encumbrance upon any of the assets of the
Company, the Operating Partnership or any of their subsidiaries
pursuant to the terms of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which either of the Transaction Entities
or any of their subsidiaries is a party or by which either of the
Transaction Entities is bound or to which any of the Properties or
other assets of either of the Transaction Entities or any of their
subsidiaries is subject, nor will such actions result in any
violation of the provisions of the charter, by-laws, certificate of
limited partnership or agreement of limited partnership of either of
the Transaction Entities or any of their subsidiaries, or any
statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over either of the
Transaction Entities or any of their subsidiaries or any of their
respective properties or assets; and except for the registration of
the Notes under the Securities Act and the qualification of the
Indenture under the Trust Indenture Act and such consents,
approvals, authorizations, registrations or qualifications as may be
required under the Exchange Act and applicable state securities laws
in connection with the purchase and distribution of the Notes by the
Agents, no consent, approval, authorization or order of, or filing
or registration with, any such court or governmental agency or body
is required for the execution, delivery and performance of this
Agreement by the Transaction Entities or the Notes, each applicable
Purchase Agreement, if any, or the Indenture by the Operating
Partnership, the consummation of the transactions contemplated
hereby and thereby, and the issuance and delivery of the Notes.
Compliance by the Operating
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Partnership with the provisions of the Notes and the Indenture has
been duly authorized by all necessary partnership action.
(p) Since the date of the Indenture, no event has occurred and
is continuing that, had the Notes been issued, would (whether or not
with the giving of notice and/or the passage of time and/or the
fulfillment of any other requirement) constitute an Event of Default
(as defined in the Indenture) under the Indenture.
(q) Other than as described in the Prospectus and other than
rights of persons whose securities are already registered under the
Securities Act, there are no contracts, agreements or understandings
between the Transaction Entities and any person granting such person
the right to require the Company to file a registration statement
under the Securities Act with respect to any securities of either of
the Transaction Entities owned or to be owned by such person or to
require either of the Transaction Entities to include such
securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any
other registration statement filed by the Transaction Entities under
the Securities Act.
(r) Except as described or contemplated in the Prospectus,
neither Transaction Entity has sold or issued any securities during
the six-month period preceding the date of the Prospectus, including
any sales pursuant to Rule 144A under, or Regulation D or S under,
the Securities Act.
(s) Neither of the Transaction Entities nor any of the
Properties has sustained, since the date of the latest audited
financial statements included in the Prospectus, any material loss
or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree,
other than as set forth or contemplated in the Prospectus; and,
since such date, there has not been any material change in the
capital stock or long-term debt of either of the Transaction
Entities or any material adverse change, or any development
involving a prospective material adverse change, in or affecting any
of the Properties or the general affairs, management, financial
position, shareholders' equity or results of operations of either of
the Transaction Entities, other than as set forth or contemplated in
the Prospectus.
(t) The financial statements (including the related notes and
supporting schedules) filed as part of, or incorporated by reference
in, the Registration Statement and the Prospectus present fairly and
will present fairly as of the applicable Representation Date and at
all times during each Marketing Period the financial condition and
results of operations of the entities purported to be shown thereby,
at the dates and for the periods indicated, and have been and will
be as of the applicable Representation Date and at all times during
each Marketing Period prepared in conformity with generally accepted
accounting principles
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applied on a consistent basis throughout the periods involved. The
unaudited financial statements of the Transition Entities, if any,
and the related notes, included or incorporated by reference in each
Prospectus present fairly and will present fairly at all times
during each period specified in Section 3(d) hereof the financial
position of the Company at the dates and for the periods indicated
in conformity with generally accepted accounting principles (except
for the absence of notes) applied on a consistent basis throughout
the periods shown, subject to normally recurring changes resulting
from year-end audit adjustments, and prepared in accordance with the
instructions to Form 10-Q. The Company's ratios of earnings to fixed
charges (actual and, if any, pro forma) included in the Prospectus
under the captions "Ratios of Earnings to Fixed Charges" and in
Exhibit 12.1 to the Registration Statement have been calculated in
compliance with Item 503(d) of Regulation S-K of the Commission. Pro
forma financial information, if any, included in or incorporated by
reference in the Registration Statement and the Prospectus has been
prepared in accordance with the applicable requirements of the
Securities Act, the Rules and Regulations and AICPA guidelines with
respect to pro forma financial information and includes all
adjustments necessary to present fairly the pro forma financial
position of the respective entity or entities presented therein at
the respective dates indicated and the results of operations for the
respective periods specified.
(u) Ernst & Young LLP, who have certified certain financial
statements of the Operating Partnership, whose reports appear in
each Prospectus or are incorporated by reference therein, are
independent public accountants as required by the Securities Act and
the Rules and Regulations.
(v) (A) The Operating Partnership and the Property Affiliates
have good and marketable title to each of the Properties, free and
clear of all liens, encumbrances, claims, security interests and
defects, other than those referred to in the Prospectus or those
which are not material in amount or those which would not have a
material adverse effect on the business, operations, use or value of
any of the Properties; (B) all liens, charges, encumbrances, claims
or restrictions on or affecting any of the Properties and the assets
of any Transaction Entity which are required to be disclosed in the
Prospectus are disclosed therein; (C) except as otherwise described
in the Prospectus, neither Transaction Entity and, to the knowledge
of the Transaction Entities, no tenant of any of the Properties is
in default under (i) any space leases (as lessor or lessee, as the
case may be) relating to the Properties, or (ii) any of the
mortgages or other security documents or other agreements
encumbering or otherwise recorded against the Properties, in each
case which default would have a material adverse effect on the
applicable Property, and neither Transaction Entity knows of any
event which, but for the passage of time or the giving of notice, or
both, would constitute such a default under any of such documents or
agreements; (D) each of the Properties complies with all applicable
codes, laws and regulations (including, without limitation, building
and zoning codes, laws and regulations and laws relating to access
to the Properties), except for such failures to comply that would
not have a material adverse effect on the
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business operations, use or value of such Property; and (E) neither
Transaction Entity has knowledge of any pending or threatened
condemnation proceedings, zoning change or other proceeding or
action that will in any material manner adversely affect the size
of, use of, improvements on, construction on or access to the
Properties.
(w) Except as described in the Prospectus, the mortgages and
deeds of trust which encumber the Properties are not convertible
into equity securities of the entity owning such Property and said
mortgages and deeds of trust are not cross-defaulted or
cross-collateralized with any property other than other Properties.
(x) Except as described in the Prospectus, the Operating
Partnership and the Property Affiliates have obtained title
insurance on the fee or leasehold interests in each of the
Properties, in an amount at least equal to the greater of (A) the
mortgage indebtedness of each such Property or (B) the purchase
price of each such Property.
(y) Except as disclosed in the Prospectus and except such as
in each case would not have a material adverse effect on any
Property, Property Affiliate, or Transaction Entity or any of their
subsidiaries, taken together as a whole; (A) to the knowledge of the
Transaction Entities, after due inquiry, the operations of the
Company, the Operating Partnership, Development Corp.,
Development-II, SP Corp., and the Properties are in compliance with
all Environmental Laws (as defined below) and all requirements of
applicable permits, licenses, approvals and other authorizations
issued pursuant to Environmental Laws; (B) to the knowledge of the
Transaction Entities, after due inquiry, none of the Transaction
Entities, the Property Affiliates or any Property has caused or
suffered to occur any Release (as defined below) of any Hazardous
Substance (as defined below) into the Environment (as defined below)
on, in, under or from any Property, and no condition exists on, in,
under or adjacent to any Property that could result in the
incurrence of liabilities under, or any violations of, any
Environmental Law or give rise to the imposition of any Lien (as
defined below), under any Environmental Law; (C) none of the
Transaction Entities or Property Affiliates has received any written
notice of a claim under or pursuant to any Environmental Law or
under common law pertaining to Hazardous Substances on, in, under or
originating from any Property; (D) neither of the Transaction
Entities has actual knowledge of, or received any written notice
from any Governmental Authority (as defined below) claiming, any
violation of any Environmental Law or a determination to undertake
and/or request the investigation, remediation, clean-up or removal
of any Hazardous Substance released into the Environment on, in,
under or from any Property; and (E) no Property is included or, to
the knowledge of the Transaction Entities, after due inquiry,
proposed for inclusion on the National Priorities List issued
pursuant to CERCLA (as defined below) by the United States
Environmental Protection Agency (the "EPA") or on the Comprehensive
Environmental Response, Compensation, and Liability Information
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System database maintained by the EPA, and neither of the
Transaction Entities has actual knowledge that any Property has
otherwise been identified in a published writing by the EPA as a
potential CERCLA removal, remedial or response site or, to the
knowledge of the Transaction Entities, is included on any similar
list of potentially contaminated sites pursuant to any other
Environmental Law.
As used herein, "Hazardous Substance" shall include any
hazardous substance, hazardous waste, toxic substance, pollutant or
hazardous material, including, without limitation, oil, petroleum or
any petroleum-derived substance or waste, asbestos or
asbestos-containing materials, PCBs, pesticides, explosives,
radioactive materials, dioxins, urea formaldehyde insulation or any
constituent of any such substance, pollutant or waste which is
subject to regulation under any Environmental Law (including,
without limitation, materials listed in the United States Department
of Transportation Optional Hazardous Material Table, 49 C.F.R.
Section 172.101, or in the EPA's List of Hazardous Substances and
Reportable Quantities, 40 C.F.R. Part 302); "Environment" shall mean
any surface water, drinking water, ground water, land surface,
subsurface strata, river sediment, buildings, structures, and
ambient, workplace and indoor and outdoor air; "Environmental Law"
shall mean the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended (42 U.S.C. Section 9601 et
seq.) ("CERCLA"), the Resource Conservation and Recovery Act of
1976, as amended (42 U.S.C. Section 6901, et seq.), the Clean Air
Act, as amended (42 U.S.C. Section 7401, et seq.), the Clean Water
Act, as amended (33 U.S.C. Section 1251, et seq.), the Toxic
Substances Control Act, as amended (15 U.S.C. Section 2601, et
seq.), the Occupational Safety and Health Act of 1970, as amended
(29 U.S.C. Section 651, et seq.), the Hazardous Materials
Transportation Act, as amended (49 U.S.C. Section 1801, et seq.),
and all other federal, state and local laws, ordinances,
regulations, rules and orders relating to the protection of the
Environment or of human health from environmental effects;
"Governmental Authority" shall mean any federal, state or local
governmental office, agency or authority having the duty or
authority to promulgate, implement or enforce any Environmental Law;
"Lien" shall mean, with respect to any Property, any lien,
encumbrance, penalty, fine, charge, assessment, judgment or other
liability in, on or affecting such Property; and "Release" shall
mean any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping, emanating or
disposing of any Hazardous Substance into the Environment,
including, without limitation, the abandonment or discard of
barrels, containers, tanks (including, without limitation,
underground storage tanks) or other receptacles containing or
previously containing any Hazardous Substance.
(z) Each Transaction Entity and their subsidiaries, and each
Property carries, or is covered by, insurance in such amounts and
covering such risks as is adequate for the conduct of its business
and the value of such Property and as is customary for companies
engaged in similar businesses in similar industries.
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(aa) Each Transaction Entity owns or possesses adequate rights
to use all material patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service mark
registrations, copyrights and licenses necessary for the conduct of
its business and has no reason to believe that the conduct of its
business will conflict with, and has not received any notice of any
claim of conflict with, any such rights of others.
(bb) Except as described in the Prospectus, there are no legal
or governmental proceedings pending to which either Transaction
Entity or their subsidiaries is a party or of which any property or
assets of either Transaction Entity or their subsidiaries is the
subject which, if determined adversely to such Transaction Entity or
subsidiary, could reasonably be expected to have a material adverse
effect on the consolidated financial position, shareholders' equity,
results of operations, business or prospects of the Company; and,
except as described in the Prospectus, to the best knowledge of the
Transaction Entities, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others.
(cc) There are no contracts or other documents which are
required to be described in the Prospectus or filed as exhibits to
the Registration Statement by the Securities Act or by the Rules and
Regulations which have not been described in the Prospectus or filed
as exhibits to the Registration Statement or incorporated therein by
reference as permitted by the Rules and Regulations.
(dd) No relationship, direct or indirect, exists between or
among either of the Transaction Entities on the one hand, and the
trustees, officers, shareholders, customers or suppliers of the
Transaction Entities on the other hand, that is required to be
described in the Prospectus that is not so described.
(ee) No labor disturbance by the employees of either
Transaction Entity exists or, to the knowledge of the Transaction
Entities, is imminent which might be expected to have a material
adverse effect on the consolidated financial position, shareholders'
equity, results of operations, business or prospects of such
Transaction Entity.
(ff) Each Transaction Entity is in compliance in all material
respects with all presently applicable provisions of the Employee
Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"); no
"reportable event" (as defined in ERISA) has occurred with respect
to any "pension plan" (as defined in ERISA) for which either
Transaction Entity would have any liability; neither Transaction
Entity has incurred or expects to incur liability under (i) Title IV
of ERISA with respect to termination of, or withdrawal from, any
"pension plan" or (ii) sections 412 or 4971 of the Internal Revenue
Code of 1986, as amended, including the regulations and published
interpretations thereunder (the "Code"); and each "pension plan" for
which either Transaction Entity would have any liability that is
intended to be
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qualified under section 401(a) of the Code is so qualified in all
material respects and nothing has occurred, whether by action or by
failure to act, which would cause the loss of such qualification.
(gg) Each Transaction Entity and their subsidiaries has filed
all federal, state and local income and franchise tax returns
required to be filed through the date hereof and has paid all taxes
due thereon, and no material tax deficiency has been determined
adversely to either Transaction Entity or their subsidiaries which
has had (nor does either Transaction Entity have any knowledge of
any tax deficiency which, if determined adversely to it might have)
a material adverse effect on the financial position, shareholders'
equity, results of operations, business or prospects of such
Transaction Entity or subsidiary.
(hh) At all times since June 16, 1994, the Company, the
Operating Partnership, Development Corp., Development-II and SP
Corp. have been, and upon the sale of the Notes will continue to be,
organized and operated in conformity with the requirements for
qualification of the Company as a real estate investment trust under
the Code and the proposed method of operation of the Company, the
Operating Partnership, Development Corp., Development-II and SP
Corp. will enable the Company to continue to meet the requirements
for qualification and taxation as a real estate investment trust
under the Code.
(ii) Since the date as of which information is given in the
Prospectus through the date hereof, and except as may otherwise be
disclosed or contemplated in the Prospectus, neither Transaction
Entity has (i) issued or granted any securities (other than in
connection with stock option or other benefit plans, the conversion
of Units to common shares of beneficial interest of the Company, the
issuance of common shares of beneficial interest of the Company in
exchange for Debentures and the issuance of Units in connection with
the acquisition of property), (ii) incurred any liability or
obligation, direct or contingent, other than liabilities and
obligations which were incurred in the ordinary course of business,
(iii) entered into any transaction not in the ordinary course of
business nor (iv) declared or paid any dividend on its capital stock
(other than regular quarterly dividends).
(jj) Each Transaction Entity and their subsidiaries (i) makes
and keeps accurate books and records and (ii) maintains internal
accounting controls which provide reasonable assurance that (A)
transactions are executed in accordance with management's
authorization, (B) transactions are recorded as necessary to permit
preparation of its financial statements and to maintain
accountability for its assets, (C) access to its assets is permitted
only in accordance with management's authorization and (D) the
reported accountability for its assets is compared with existing
assets at reasonable intervals.
(kk) No Transaction Entity or any of their subsidiaries (i) is
in violation of its charter, by-laws, certificate of limited
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partnership, agreement of limited partnership or other similar
organizational document, (ii) is in default in any material respect,
and no event has occurred which, with notice or lapse of time or
both, would constitute such a default, in the due performance or
observance of any term, covenant or condition contained in any
material indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it is
bound or to which any of the Properties or any of its other
properties or assets is subject or (iii) is in violation in any
material respect of any law, ordinance, governmental rule,
regulation or court decree to which it or the Properties or any of
its other properties or assets may be subject or has failed to
obtain any material license, permit, certificate, franchise or other
governmental authorization or permit necessary to the ownership of
the Properties or any of its other properties or assets or to the
conduct of its business.
(ll) Neither Transaction Entity, nor any trustee, officer,
agent, employee or other person associated with or acting on behalf
of either Transaction Entity, has used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expense
relating to political activity; made any direct or indirect unlawful
payment to any foreign or domestic government official or employee
from corporate funds; violated or is in violation of any provision
of the Foreign Corrupt Practices Act of 1977; or made any bribe,
rebate, payoff, influence payment, kickback or other unlawful
payment.
(mm) Neither Transaction Entity or any of their subsidiaries
is an "investment company" within the meaning of such term under the
Investment Company Act of 1940 and the rules and regulations of the
Commission thereunder.
(nn) Other than this Agreement and as set forth in the
Prospectus under the heading "Plan of Distribution," there are no
contracts, agreements or understandings between either Transaction
Entity and any person that would give rise to a valid claim against
either Transaction Entity or any Agent for a brokerage commission,
finder's fee or other like payment with respect to the consummation
of the transactions contemplated by this Agreement.
(oo) The Notes have been rated by a "nationally recognized
statistical rating agency" (as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act), including
one or both of Moody's Investor Services, Inc. and Standard & Poor's
Corporation.
(pp) The certificates delivered pursuant to paragraph (h) of
Section 5 hereof and all other documents delivered by the
Transaction Entities or their representatives in connection with the
issuance and sale of the Notes were on the dates on which they were
delivered, or will be on the dates on which they are to be
delivered, true and complete in all material respects.
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(qq) Each Transaction Entity has complied with all applicable
provisions of Florida Statutes Section 517.075, relating to issuers
doing business with Cuba.
2. Solicitations as Agent; Purchases as Principal.
(a) Appointment. Subject to the terms and conditions stated
herein, and subject to the reservation by the Operating Partnership
of the right to sell Notes directly on its own behalf and through or
to other dealers or agents, the Operating Partnership hereby
appoints each of the Agents on a non-exclusive basis as an agent of
the Operating Partnership for the purpose of soliciting or receiving
offers to purchase the Notes from the Operating Partnership by
others. The Operating Partnership may from time to time offer Notes
for sale otherwise than through an Agent; provided, however, that so
long as this Agreement shall be in effect, the Operating Partnership
shall not solicit offers to purchase Notes through any other agent
without amending this Agreement to appoint such agent as an
additional Agent hereunder on the same terms and conditions as
provided herein for the Agents and without giving the Agents prior
notice of such appointment. The consent of the then-current Agents
shall not be necessary for such purpose. In the absence of such an
amendment, the Operating Partnership may accept offers to purchase
Notes from or through an agent other than an Agent, provided that
(i) the Operating Partnership shall not have solicited such offers,
(ii) the Operating Partnership and such agent shall have executed an
agreement with respect to such purchases having terms and conditions
(including, without limitation, commission rates) with respect to
such purchases substantially the same as the terms and conditions
that would apply to such purchases under this Agreement if such
agent was an Agent (which may be accomplished by incorporating by
reference in such agreement the terms and conditions of this
Agreement), and (iii) the Operating Partnership shall provide the
Agents with a copy of such agreement following the execution
thereof. On the basis of the representations and warranties
contained herein, but subject to the terms and conditions herein set
forth, each Agent agrees, as an agent of the Operating Partnership,
to use its reasonable efforts to solicit offers to purchase the
Notes upon the terms and conditions set forth in the Prospectus.
Except as otherwise provided herein, so long as this Agreement shall
remain in effect with respect to any Agent, the Operating
Partnership shall not, without the consent of each such Agent,
solicit or accept offers to purchase Notes otherwise than through
one of the Agents; provided, however, the Operating Partnership
expressly reserves the right to sell Notes directly to investors, in
which case no commission will be payable with respect to any such
sale. Each Agent may also purchase Notes from the Operating
Partnership as principal for purposes of resale, as more fully
described in paragraph (e) of this Section.
(b) Suspension of Solicitation. The Operating Partnership
reserves the right, in its sole discretion, to suspend solicitation
of offers to purchase the Notes commencing at any time for any
period of time or indefinitely. Upon receipt of at least one
business day's prior written notice from the Operating Partnership,
the Agents will forthwith suspend solicitation of offers to purchase
Notes from the
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Operating Partnership until such time as the Operating Partnership
has advised the Agents that such solicitation may be resumed. For
the purpose of the foregoing sentence, "business day" shall mean any
day which is not a Saturday or Sunday and which is not a day on
which (i) banking institutions are generally authorized or obligated
by law to close in The City of New York and (ii) The New York Stock
Exchange, Inc. is closed for trading.
Upon receipt of notice from the Operating Partnership as
contemplated by Section 3(d) hereof, each Agent shall suspend its
solicitation of offers to purchase Notes until such time as the
Operating Partnership shall have furnished it with an amendment or
supplement to the Registration Statement or the Prospectus, as the
case may be, contemplated by Section 3(d) and shall have advised
such Agent that such solicitation may be resumed.
(c) Agent's Commission. Promptly upon the closing of the sale
of any Notes sold by the Operating Partnership as a result of a
solicitation made by or offer to purchase received by an Agent, the
Operating Partnership agrees to pay such Agent a commission in
accordance with the schedule set forth in Schedule A hereto.
(d) Solicitation of Offers. The Agents are authorized to
solicit offers to purchase the Notes only in denominations as are
specified in the Prospectus at a purchase price as shall be
specified by the Operating Partnership. Each Agent shall communicate
to the Operating Partnership, orally or in writing, each reasonable
offer to purchase Notes received by it as an Agent. The Operating
Partnership shall have the sole right to accept offers to purchase
the Notes and may reject any such offer in whole or in part. Each
Agent shall have the right, in its discretion reasonably exercised
without advising the Operating Partnership, to reject any offer to
purchase the Notes received by it, in whole or in part, and any such
rejection shall not be deemed a breach of its agreement contained
herein.
No Note which the Operating Partnership has agreed to sell
pursuant to this Agreement shall be deemed to have been purchased
and paid for, or sold by the Operating Partnership, until such Note
shall have been delivered to the purchaser thereof against payment
by such purchaser.
(e) Purchases as Principal. Each sale of Notes to any Agent as
principal, for resale to one or more investors or to another
broker-dealer (acting as principal for purposes of resale), shall be
made in accordance with the terms of this Agreement and a Purchase
Agreement, whether oral (in which case such Purchase Agreement shall
be confirmed in writing within one business day of such Purchase
Agreement by such Agent to the Operating Partnership, which may be
by facsimile transmission) or in writing, which will provide for the
sale of such Notes to, and the purchase thereof by, such Agent. A
Purchase Agreement may also specify certain provisions relating to
the reoffering of such Notes by such Agent. The commitment of any
Agent to purchase Notes from the Operating
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Partnership as principal shall be deemed to have been made on the
basis of the representations and warranties of the Transaction
Entities herein contained and shall be subject to the terms and
conditions herein set forth. Each Purchase Agreement shall contain,
to the extent applicable, those terms specified in Exhibit A hereto,
including the principal amount and terms of the Notes to be
purchased by an Agent, the time and date (each such time and date
being referred to herein as a "Time of Delivery") and place of
delivery of and payment for such Notes and such other information
(as applicable) as is set forth in Exhibit C hereto. The Operating
Partnership agrees that if any Agent purchases Notes as principal
for resale such Agent shall receive such compensation, in the form
of a discount or otherwise, as shall be indicated in the applicable
Purchase Agreement or, if no compensation is indicated therein, a
commission in accordance with Schedule A hereto. Any Agent may
utilize a selling or dealer group in connection with the resale of
such Notes. In addition, any Agents may offer the Notes they have
purchased as principal to other dealers. Any Agent may sell Notes to
any dealer at a discount and, unless otherwise specified in the
applicable Pricing Supplement, such discount allowed to any dealer
will not be in excess of 66 2/3% of the discount to be received by
such Agent from the Operating Partnership. Such Purchase Agreement
shall also specify any requirements for delivery of opinions of
counsel, accountant's letters and officers' certificates pursuant to
Section 5 hereof.
(f) Administrative Procedures. The purchase price, interest
rate or formula, maturity date and other terms of the Notes (as
applicable) specified in Exhibit A hereto shall be agreed upon by
the Operating Partnership and the applicable Agent or Agents and
specified in a Pricing Supplement to be prepared in connection with
each sale of Notes. Administrative procedures respecting the sale of
Notes (the "Procedures") are set forth in Exhibit B hereto and may
be amended in writing from time to time by the Agents and the
Operating Partnership. Each Agent and the Operating Partnership
agree to perform the respective duties and obligations specifically
provided to be performed by each of them herein and in the
Procedures. The Procedures shall apply to all transactions
contemplated hereunder including sales of Notes to any Agent as
principal pursuant to a Purchase Agreement, unless otherwise set
forth in such Purchase Agreement.
(g) Delivery of Documents. The documents required to be
delivered by Section 5 hereof shall be delivered at the offices of
Rogers & Wells, 200 Park Avenue, New York, New York 10166, not later
than 10:00 A.M., New York City time, on the date of this Agreement
or at such later time as may be mutually agreed upon by the Company
and the Agents, which in no event shall be later than the time at
which the Agents commence solicitation of offers to purchase Notes
hereunder (the "Closing Date").
3. Further Agreements of the Transaction Entities. Each of the
Transaction Entities jointly and severally agrees:
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(a) To prepare the Prospectus in a form approved by the Agents
and to file such Prospectus pursuant to Rule 424(b) under the
Securities Act not later than the Commission's close of business on
the fifth business day following the execution and delivery of this
Agreement or, if applicable, such earlier time as may be required by
Rule 424 or Rule 430A(a)(3) under the Securities Act; to make no
further amendment or any supplement to the Registration Statement or
to the Prospectus except in accordance with Section 3(d) hereof; to
advise the Agents, promptly after it receives notice thereof, of the
time when any amendment to the Registration Statement has been filed
or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed and to furnish the Agents with
copies thereof; to advise the Agents, promptly after it receives
notice thereof, of the issuance by the Commission of any stop order
or of any order preventing or suspending the use of the Prospectus,
of the suspension of the qualification of the Notes for offering or
sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission
for the amending or supplementing of the Registration Statement or
the Prospectus or for additional information; and, in the event of
the issuance of any stop order or of any order preventing or
suspending the use of the Prospectus or suspending any such
qualification, to use promptly its best efforts to obtain its
withdrawal;
(b) To furnish promptly to the Agents and to counsel for the
Agents such number of conformed copies as the Agents shall
reasonably request of the Registration Statement as originally filed
with the Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed therewith or
incorporated by reference therein and all documents incorporated by
reference therein;
(c) To deliver promptly to the Agents such number of the
following documents as the Agents shall reasonably request: (i) the
Basic Prospectus, (ii) each Prospectus and any amended or
supplemented Prospectus and (iv) any documents incorporated by
reference into the Prospectus.
(d) If, during any Marketing Period, any event occurs as a
result of which the Prospectus would include an untrue statement of
a material fact or omit to state any material fact necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading, or if it is necessary at any time to
amend any Prospectus to comply with the Securities Act, to notify
the Agents promptly, in writing, to suspend solicitation of
purchases of the Notes; and if the Operating Partnership shall
decide to amend or supplement the Registration Statement or any
Prospectus, to promptly advise the Agents by telephone (with
confirmation in writing) and to promptly, in writing, prepare and
file with the Commission an amendment or supplement which will
correct such statement or omission or an amendment which will effect
such compliance; provided, however, that if during the period
referred to above any Agent shall own any Notes which it has
purchased from the Operating Partnership as principal
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with the intention of reselling them, the Operating Partnership
shall promptly prepare and timely file with the Commission any
amendment or supplement to the Registration Statement or any
Prospectus that may, in the judgment of the Operating Partnership or
the Agents, be required by the Securities Act or requested by the
Commission. The aforementioned documents furnished to the Agents
will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
(e) 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 Operating Partnership or
counsel for the Agents, be required by the Securities Act or
requested by the Commission;
(f) To timely file with the Commission during any Marketing
Period, all documents (and any amendments to previously filed
documents) required to be filed by the Operating Partnership
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act.
(g) Prior to filing with the Commission during any Marketing
Period, any amendment to the Registration Statement or supplement to
any Prospectus or any Prospectus pursuant to Rule 424 of the Rules
and Regulations or any document incorporated by reference in any of
the foregoing or any amendment of or supplement to any such
incorporated document, to furnish a copy thereof to the Agents and
counsel for the Agents within a reasonable period of time prior to
the filing thereof, and that filing thereof shall not occur if the
Agents shall have objected in good faith thereto;
(h) To advise the Agents promptly (i) when any post-effective
amendment to the Registration Statement relating to or covering the
Notes becomes effective, (ii) of any request or proposed request by
the Commission for an amendment or supplement to the Registration
Statement, to any Prospectus, to any document incorporated by
reference in any of the foregoing or for any additional information
and the Operating Partnership will afford the Agents a reasonable
opportunity to comment on any such proposed amendment or supplement,
(iii) of the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or any part thereof
or any order directed to any Prospectus or any document incorporated
therein by reference or the initiation or threat of any stop order
proceeding or of any challenge to the accuracy or adequacy of any
document incorporated by reference in any Prospectus, (iv) of
receipt by the Operating Partnership of any notification with
respect to the suspension of the qualification of the Notes for sale
in any jurisdiction or the initiation or threat of any proceeding
for that purpose, (v) of any downgrading in the rating of the Notes
or any other debt securities of the Operating Partnership, or any
proposal to downgrade the rating of the Notes or any other debt
securities of the Operating Partnership, by any "nationally
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recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Act), or any public announcement that any
such organization has under surveillance or review its rating of any
debt securities of the Operating Partnership (other than an
announcement with positive implications of a possible upgrading, and
no implication of a possible downgrading of such rating) as soon as
the Operating Partnership learns of any such downgrading, proposal
to downgrade or public announcement and (vi) of the happening of any
event which makes untrue in any material respect any statement of a
material fact made in the Registration Statement or any Prospectus
or which requires the making of a change in the Registration
Statement or any Prospectus in order to make any material statement
therein, in light of the circumstances under which it was made, not
misleading.
(i) If, during any Marketing Period, the Commission shall
issue a stop order suspending the effectiveness of the Registration
Statement, to make every reasonable effort to obtain the lifting of
that order at the earliest possible time.
(j) As soon as practicable after the date of each acceptance
by the Operating Partnership of an offer to purchase Notes
hereunder, but not later than 18 months after any such offer, to
make generally available to its security holders an earnings
statement covering a period of at least 12 months beginning after
the later of (i) the effective date of the Registration Statement,
(ii) the effective date of the most recent post-effective amendment
to the Registration Statement to become effective prior to the date
of such acceptance and (iii) the date of the Operating Partnership's
most recent Annual Report on Form 10-K filed with the Commission
prior to the date of such acceptance which will satisfy the
provisions of Section 11(a) of the Act (including, at the option of
the Operating Partnership, Rule 158 of the Rules and Regulations
under the Act);
(k) So long as any of the Notes are outstanding, to furnish to
the Agents, not later than the time the Operating Partnership makes
the same available to others, copies of all public reports or
releases and all reports and financial statements furnished by the
Operating Partnership to any securities exchange on which the Notes
are listed pursuant to requirements of or agreements with such
exchange or to the Commission pursuant to the Exchange Act or any
rule or regulation of the Commission thereunder.
(l) Promptly from time to time to take such action as the
Agents may reasonably request to qualify the Notes for offering and
sale under the securities, real estate syndication or Blue Sky laws
of such jurisdictions as the Agents may designate and to comply with
such laws so as to permit the continuance of sales and dealings
therein in such jurisdictions for as long as may be necessary to
complete the distribution of the Notes, except that the Operating
Partnership shall not be required in connection therewith to qualify
as a foreign limited partnership or to execute a consent to service
of process in any jurisdiction;
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(m) Between the date of a Purchase Agreement and the date of
delivery of the Notes specified therein, neither of the Transaction
Entities will, directly or indirectly, offer for sale, contract to
sell, sell or otherwise dispose of, or register for sale under the
Securities Act, any debt securities, or sell or grant options,
rights or warrants with respect to any debt securities, without the
prior written consent of Lehman Brothers Inc., other than borrowings
under the Operating Partnership's revolving credit agreements and
lines of credit, the private placement of securities and issuances
of its commercial paper;
(n) To apply the net proceeds from the sale of the Notes in
accordance with the description set forth in the Prospectus under
the caption "Use of Proceeds";
(o) To take such steps as shall be necessary to ensure that
neither the Company, the Operating Partnership nor any of their
subsidiaries shall become an "investment company" within the meaning
of such term under the Investment Company Act of 1940 and the rules
and regulations of the Commission thereunder;
(p) Except as stated in this Agreement and the Prospectus,
neither Transaction Entity has taken, nor will take, directly or
indirectly, any action designed to or that might reasonably be
expected to cause or result in stabilization or manipulation of the
price of the Notes to facilitate the sale or resale of the Notes;
(q) The Company will use its best efforts to continue to meet
the requirements to qualify as a "real estate investment trust"
under the Code; and
(r) If this Agreement shall be terminated by the Agents
because of any failure or refusal on the part of the Transaction
Entities to comply with the terms or fulfill any of the conditions
of this Agreement, the Transaction Entities jointly and severally
agree to reimburse the Agents for all reasonable out-of-pocket
expenses (including fees and expenses of counsel for the Agents)
incurred by the Agents in connection herewith through the date of
such termination.
(s) To prepare, with respect to any Notes to be sold through
or to the Agents pursuant to this Agreement, a Pricing Supplement
with respect to such Notes in a form previously approved by the
Agents and to file such Pricing Supplement pursuant to Rule 424
under the Act with the Commission(2).
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(2) If clause (b)(3) of Rule 424 is applicable, such filing shall be made no
later than the fifth business day following the earlier of the date of
determination of the settlement information described below or the date
such Pricing Supplement is first used. If clause (b)(2) or (b)(5) of Rule
424 is applicable, such filing shall be made no later than the second
business day following the earlier of the date of determination of the
settlement information or the date such Pricing Supplement is first used.
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4. Expenses. The Transaction Entities jointly and severally agree to
pay (a) the costs incident to the authorization, issuance, sale and delivery of
the Notes and any taxes payable in that connection; (b) the costs incident to
the preparation, printing and filing under the Securities Act of the
Registration Statement and any amendments and exhibits thereto; (c) the costs
incident to the preparation, printing and filing of any document and any
amendments and exhibits thereto required to be filed by the Operating
Partnership under the Exchange Act; (d) the costs of distributing the
Registration Statement, as originally filed, and each amendment and
post-effective amendment thereof (including, in each case, exhibits), the Basic
Prospectus, each Prospectus, any supplement or amendment to any Prospectus and
any documents incorporated by reference in any of the foregoing documents; (e)
the fees and disbursements of the Trustee, any paying agent, any calculation
agent, any exchange rate agent and any other agents appointed by the Operating
Partnership, and their respective counsel; (f) the costs and fees in connection
with the listing of the Notes on any securities exchange; (g) the cost and fees
in connection with any filings with the National Association of Securities
Dealers, Inc.; (h) the fees and disbursements of counsel to the Operating
Partnership and counsel to the Agents; (i) the fees paid to rating agencies in
connection with the rating of the Notes; (j) the fees and expenses of qualifying
the Notes under the securities laws of the several jurisdictions as provided in
Section 3(l) hereof and of preparing and printing a Blue Sky Memorandum and a
memorandum concerning the legality of the Notes as an investment (including fees
and expenses of counsel for the Agents in connection therewith); (k) all
advertising expenses in connection with the offering of the Notes incurred with
the consent of the Operating Partnership; and (l) all other costs and expenses
arising out of the transactions contemplated hereunder and incident to the
performance of the Operating Partnership's obligations under this Agreement or
otherwise in connection with the activities of the Agents under this Agreement.
5. Conditions of Agents' Obligations. The respective obligations of
the Agents under this Agreement, as agents of the Operating Partnership, to
solicit offers to purchase the Notes; the obligation of any person who has
agreed to purchase, make payment for and take delivery of Notes; and the
obligation of any Agent to purchase Notes pursuant to any Purchase Agreement,
are all subject to (i) the accuracy, on each Representation Date, of the
representations and warranties of the Transaction Entities contained herein,
(ii) the accuracy of the statements of the Transaction Entities' officers made
in any certificate furnished pursuant to the provisions hereof, (iii) the
performance by the Transaction Entities of each of its obligations hereunder and
(iv) each of the following additional terms and conditions:
(a) The Prospectus as amended or supplemented (including the
Pricing Supplement) with respect to such Notes shall have been filed
with the Commission pursuant to Rule 424(b) under the Act within the
applicable time period prescribed for such filing by the Rules and
Regulations and in accordance with Section 3(s) hereof; no stop
order suspending the effectiveness of the Registration Statement or
any part thereof nor any order directed to any document incorporated
by reference in any Prospectus shall have been issued and no stop
order proceeding shall have been initiated or threatened by the
Commission and no challenge shall have been made to the accuracy or
adequacy of any document incorporated by reference in any
Prospectus; any request of the Commission for inclusion of
additional information in the Registration Statement or any
Prospectus or
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otherwise shall have been complied with; and the Operating
Partnership shall not have filed with the Commission any amendment
or supplement to the Registration Statement or any Prospectus (or
any document incorporated by reference therein) without the consent
of the Agents.
(b) No order suspending the sale of the Notes in any
jurisdiction designated by the Agents pursuant to Section 3(l)
hereof shall have been issued, and no proceeding for that purpose
shall have been initiated or threatened.
(c) Subsequent to the effective date of this Agreement, there
shall not have occurred (i) any change, or any development involving
a prospective change, in or affecting the condition, financial or
otherwise, business, properties, net worth, or results of operations
of either Transaction Entity or any of their subsidiaries or any
Property not contemplated by the Prospectus, which, in the opinion
of the Agents, would materially adversely affect the market for the
Notes, or (ii) any event or development relating to or involving
either Transaction Entity, or any partner, officer, director or
trustee of either Transaction Entity, which makes any statement of a
material fact made in the Prospectus untrue or which, in the opinion
of the Company and its counsel or the Agents and their counsel,
requires the making of any addition to or change in the Prospectus
in order to state a material fact required by the Securities Act or
any other law to be stated therein or necessary in order to make the
statements therein not misleading, if amending or supplementing the
Prospectus to reflect such event or development would, in your
opinion, materially adversely affect the market for the Notes.
(d) All corporate and partnership proceedings and other legal
matters incident to the authorization, form and validity of this
Agreement, the Indenture, the Notes, the Registration Statement and
each Prospectus, and all other legal matters relating to this
Agreement, the Indenture, the Notes, the Registration Statement and
the Prospectus and the transactions contemplated hereby and thereby
shall be reasonably satisfactory in all material respects to counsel
for the Agents, and the Transaction Entities shall have furnished to
such counsel all documents and information that they may reasonably
request to enable them to pass upon such matters.
(e) (A) At the Closing Date, the Agents shall have received
the opinion, addressed to the Agents and dated the Closing Date, of
Wolf, Block, Schorr and Solis-Cohen LLP, counsel to the Transaction
Entities, in form and substance satisfactory to the Agents and their
counsel, to the effect that:
(i) The Company is in good standing as a
foreign trust or corporation in those jurisdictions listed in
such opinion.
(ii) The Operating Partnership has been duly
formed and is validly existing as a limited partnership under
the laws of the Commonwealth of Pennsylvania, is duly
qualified to do business as a
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foreign limited partnership in Delaware, Florida, Maryland,
Michigan, Minnesota, New Jersey, North Carolina, South
Carolina, Tennessee, Texas and Virginia, and has all
partnership power and authority necessary to own or hold its
properties, to conduct the business in which it is engaged as
described in the Registration Statement and the Prospectus,
and to enter into and perform its obligations under this
Agreement. The Company is the sole general partner of the
Operating Partnership. The Operating Partnership Agreement is
in full force and effect, and the aggregate percentage
interests of the Company and the limited partners in the
Operating Partnership are as set forth in the Prospectus. All
of the partnership interests of the Operating Partnership have
been duly and validly authorized and issued, are fully paid
and, to the extent that such interests are owned by the
Company, are owned by the Company free and clear of all liens,
encumbrances, equities or claims.
(iii) Development Corp. has been duly formed
and is validly existing as a corporation in good standing
under the laws of the Commonwealth of Pennsylvania, is duly
qualified to do business and is in good standing as a foreign
corporation in Delaware, Florida, Maryland, New Jersey and
North Carolina, and has all corporate power and authority
necessary to own or hold its properties and to conduct the
business in which it is engaged as described in the
Registration Statement and the Prospectus. All of the issued
and outstanding capital stock of Development Corp. has been
duly authorized and validly issued and is fully paid and
non-assessable, has been offered and sold in compliance with
all applicable laws (including, without limitation, federal or
state securities laws) and all of the capital stock of
Development Corp. owned by the Operating Partnership, as
described in the Prospectus, is owned free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim,
restriction or equities.
(iv) Development-II has been duly formed and
is validly existing as a corporation in good standing under
the laws of the Commonwealth of Pennsylvania, and has all
corporate power and authority necessary to own or hold its
properties and to conduct the business in which it is engaged
as described in the Registration Statement and the Prospectus.
All of the issued and outstanding capital stock of
Development-II has been duly authorized and validly issued and
is fully paid and non-assessable, has been offered and sold in
compliance with all applicable laws (including, without
limitation, federal or state securities laws) and all of the
capital stock of Development-II owned by the Operating
Partnership, as described in the Prospectus, is owned free and
clear of any security interest, mortgage, pledge, lien,
encumbrance, claim, restriction or equities.
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(v) SP Corp. has been duly formed and is
validly existing as a corporation in good standing under the
laws of the Commonwealth of Pennsylvania and has all corporate
and authority necessary to own or hold its properties and to
conduct the business in which it is engaged as described in
the Registration Statement and the Prospectus. All of the
issued and outstanding capital stock of SP Corp. has been duly
authorized and validly issued and is fully paid and
non-assessable, is owned by the Company free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim,
restriction or equities and has been offered and sold in
compliance with all applicable laws (including, without
limitation, federal or state securities laws).
(vi) Each of the Property Affiliates has been
duly organized and is validly existing as a limited
partnership in good standing under the laws of the
Commonwealth of Pennsylvania, and has all partnership power
and authority necessary to own or hold its properties and to
conduct the business in which it is engaged. Except as set
forth in the Prospectus, all of the partnership interests of
each Property Affiliate have been duly and validly authorized
and issued, are fully paid and non-assessable and all of the
partnership interests owned directly or indirectly by the
Company and the Operating Partnership, as described in the
Prospectus, are owned free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim, restriction or
equities.
(vii) (A) This Agreement has been duly and
validly authorized, executed and delivered by the Operating
Partnership, and has been duly and validly executed and
delivered by the Company, and assuming due authorization,
execution and delivery by the Agents and due authorization by
the Company, is a valid and binding agreement of the Operating
Partnership; and (B) the partnership agreement of each
Property Affiliate has been duly and validly authorized,
executed and delivered by the Operating Partnership, and each
such agreement and the Operating Partnership Agreement have
been duly and validly executed and delivered by the Company,
and assuming due authorization by the Company, each such
agreement is a valid and binding agreement of the parties
thereto, enforceable against such parties in accordance with
its terms.
(viii) (A) The Indenture has been duly
authorized, executed and delivered by the Operating
Partnership, duly qualified under the Indenture Act and
(assuming due authorization, execution and delivery by the
Trustee) constitutes a valid and binding agreement on the part
of the Operating Partnership, enforceable against the
Operating Partnership in accordance with its terms; and (B)
the Indenture conforms in all material respects to the
descriptions thereof contained in the Registration Statement
and the Prospectus.
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(ix) The Notes are in a form contemplated by
the Indenture and have been validly authorized for issuance
and sale pursuant to this Agreement and, when the terms of the
Notes and of their issue and sale have been duly established
in accordance with the Indenture and this Agreement so as not
to violate any applicable law or agreement or instrument then
binding on the Operating Partnership, and when the Notes have
been duly executed, authenticated and delivered against
payment therefor as provided in this Agreement and the
Indenture, the Notes will be validly issued and outstanding,
and will constitute valid and legally binding obligations of
the Operating Partnership entitled to the benefits of the
Indenture and enforceable in accordance with their terms and
the terms of the Indenture. The terms of the Notes conform in
all material respects to all statements and descriptions
related thereto contained in the Registration Statement and
the Prospectus. The Notes rank and will rank on a parity with
all unsecured indebtedness (other than subordinated
indebtedness of the Operating Partnership that was outstanding
on the date of the applicable Pricing Supplement or that may
be incurred thereafter), and senior to all subordinated
indebtedness of the Operating Partnership that was outstanding
on the date of the applicable Pricing Supplement or that may
be incurred thereafter, except that the Notes will be
effectively subordinated to the prior claims of each secured
mortgage lender to any specific Property which secures such
lender's mortgage.
(x) To the knowledge of such counsel, the
execution, delivery and performance of this Agreement by each
of the Transaction Entities, the execution, delivery and
performance of the Indenture, the Notes, and each applicable
Purchase Agreement, if any, by the Operating Partnership, the
consummation of the transactions contemplated hereby and
thereby, and the compliance by the Operating Partnership with
the provisions of the Notes and the Indenture, will not
conflict with or result in a breach or violation of any of the
terms or provisions of, result in the creation or imposition
of any lien, charge or encumbrance upon any of the assets of
either of the Transaction Entities or any of their
subsidiaries pursuant to the terms of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which either of the
Transaction Entities or their subsidiaries is a party or by
which either of the Transaction Entities or their subsidiaries
is bound or to which any of the Properties or other assets of
either of the Transaction Entities is subject, nor will such
actions result in any violation of the provisions of the
charter, by-laws, certificate of limited partnership or
agreement of limited partnership of either of the Transaction
Entities or their subsidiaries, or any statute or any order,
rule or regulation of any court or governmental agency or body
having jurisdiction over either of the Transaction Entities or
any of their properties or assets; and except for the
registration of the Notes under the Securities Act and the
qualification of the Indenture under the Trust Indenture Act
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and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and
applicable state securities laws in connection with the
issuance and delivery of the Notes by the Company and the
purchase and distribution of the Notes by the Agents, no
consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or
body is required for the execution, delivery and performance
of this Agreement by the Transaction Entities or the Notes,
each applicable Purchase Agreement, if any, or the Indenture
by the Operating Partnership, the consummation of the
transactions contemplated hereby and thereby, and the issuance
and delivery of the Notes.
(xi) (A) The issuance and delivery of the
Notes by the Operating Partnership and the compliance by the
Operating Partnership with all of the provisions of this
Agreement, and the consummation of the transactions
contemplated hereby, have been duly authorized by all
necessary partnership action; and (B) the execution, delivery
and performance of this Agreement by each of the Transaction
Entities and the consummation of the transactions contemplated
hereby will not conflict with or result in any violation of
the provisions of the charter, by-laws, certificate of limited
partnership or agreement of limited partnership of either of
the Transaction Entities or their subsidiaries.
(xii) Except as set forth in the Prospectus,
to the knowledge of such counsel, there are no preemptive or
other rights to subscribe for or to purchase, nor any
restriction upon the transfer of, the Notes pursuant to the
Operating Partnership's certificate of limited partnership,
its agreement of limited partnership, as amended to the date
hereof, or any agreement or other instrument to which the
Operating Partnership is a party.
(xiii) To the knowledge of such counsel, other
than as set forth in the Prospectus and other than rights of
persons whose securities are already registered under the
Securities Act, there are no contracts, agreements or
understandings between the Company and/or the Operating
Partnership, on the one hand, and any person, on the other,
granting such person the right to require the Company or the
Operating Partnership to file a registration statement under
the Securities Act with respect to any securities of the
Company or the Operating Partnership owned or to be owned by
such person or to require the Company or the Operating
Partnership to include such securities in the securities
registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration
statement filed by the Company or the Operating Partnership
under the Securities Act.
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(xiv) To the knowledge of such counsel, there
are no legal or governmental proceedings pending to which
either Transaction Entity or their subsidiaries is a party or
of which any property or assets of either Transaction Entity
or their subsidiaries is the subject which are not disclosed
in the Prospectus and which, if determined adversely to such
Transaction Entity or subsidiary, might reasonably be expected
to have a material adverse effect on the consolidated
financial position, owners' equity, results of operations,
business or prospects of the Company; and to the knowledge of
such counsel no such proceedings are threatened or
contemplated by governmental authorities or threatened by
others.
(xv) To the knowledge of such counsel, there
are no contracts or other documents which are required by the
Securities Act or by the Rules and Regulations to be described
in the Prospectus or filed as exhibits to the Registration
Statement which have not been described in the Prospectus or
filed as exhibits to the Registration Statement or
incorporated therein by reference as permitted by the Rules
and Regulations.
(xvi) To the knowledge of such counsel, no
relationship, direct or indirect, exists between or among
either of the Transaction Entities on the one hand, and the
trustees, officers, shareholders, customers or suppliers of
the Transaction Entities on the other hand, which is required
to be described in the Prospectus which is not so described.
(xvii) To the knowledge of such counsel, each
Transaction Entity is in compliance in all material respects
with all presently applicable provisions of ERISA; to the
knowledge of such counsel, no "reportable event" (as defined
in ERISA) has occurred with respect to any "pension plan" (as
defined in ERISA) for which either Transaction Entity would
have any liability; to the knowledge of such counsel, neither
Transaction Entity has incurred or expects to incur, liability
under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any "pension plan" or (ii) section 412 or
4971 of the Code; and, to the knowledge of such counsel, each
"pension plan" for which either Transaction Entity would have
any liability that is intended to be qualified under section
401(a) of the Code is so qualified in all material respects
and, to the knowledge of such counsel, nothing has occurred,
whether by action or by failure to act, which would cause the
loss of such qualification.
(xviii) No Transaction Entity or Property
Affiliate is in violation of its charter, by-laws, certificate
of limited partnership, agreement of limited partnership, or
other similar organizational document, or, to the knowledge of
such counsel, has a default been asserted in any
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respect, and, to the knowledge of such counsel, it has not
been asserted that any event has occurred which, with notice
or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or
condition contained in any material indenture, mortgage, deed
of trust, loan agreement or other material agreement or
instrument to which it is a party or by which it is bound or
to which any of the Properties or any of its other properties
or assets is subject.
(xix) No consent, approval, authorization or
other order of, or registration or filing with, any court,
regulatory body, administrative agency or other governmental
body, agency, or official is required to the date hereof on
the part of the Company (except as have been obtained under
the Securities Act and the Exchange Act or such as may be
required under state securities, real estate syndication or
Blue Sky laws governing the purchase and distribution of the
Notes) for the valid issuance and sale of the Notes to the
Agents as contemplated by this Agreement.
(xx) Neither Transaction Entity or their
subsidiaries is an "investment company" within the meaning of
such term under the Investment Company Act of 1940 and the
rules and regulations of the Commission thereunder.
(xxi) The Operating Partnership is not
required to register under the provisions of the Investment
Company Act; and no action need be taken with respect to or
under the Investment Company Act by reason of the issuance of
the Notes by the Operating Partnership.
(xxii) The documents incorporated or deemed to
be incorporated by reference in the Prospectus pursuant to
Item 12 of Form S-3 under the Securities Act (other than the
financial statements and related schedules and financial
information and data included therein, as to which no opinion
need be rendered), at the time they were filed with the
Commission, complied as to form in all material respects with
the requirements of the Exchange Act and the rules and
regulations thereunder.
(xxiii) The Registration Statement was
declared effective under the Securities Act and the Indenture
was duly qualified under the Trust Indenture Act as of the
date and time specified in such opinion, the Prospectus was
filed with the Commission pursuant to the subparagraph of Rule
424(b) of the Rules and Regulations specified in such opinion
on the date specified therein and, to the knowledge of such
counsel, no stop order suspending the effectiveness of the
Registration Statement has been issued and, to the knowledge
of such counsel, no proceeding for that purpose is pending or
threatened by the Commission.
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(xxiv) To the knowledge of such counsel, no
order directed to any document incorporated by reference in
the Prospectus has been issued and no assertion of a material
misstatement or omission regarding any such document has been
made.
(xxv) The Registration Statement and the
Prospectus (other than the financial statements and related
schedules and other financial information and data included
therein, as to which such counsel need express no opinion)
comply as to form in all material respects with the
requirements of the Securities Act, the Rules and Regulations
and the Trust Indenture Act and the rules and regulations
thereunder, and the Indenture conforms in all material
respects to the requirements of the Trust Indenture Act and
the rules and regulations thereunder.
(xxvi) The Operating Partnership is classified
as a partnership (and is not taxed as a corporation) for
federal income tax purposes.
(xxvii) The statements contained in the
Prospectus under the captions "Risk Factors," "Description of
Debt Securities," "Description of Notes," and "Special
Provisions Relating to Multi-Currency Notes," insofar as those
statements are descriptions of contracts, agreements or other
legal documents, or they describe federal statutes, rules and
regulations, and except to the extent such statements are
statistics or calculations, constitute a fair summary thereof.
(xxviii) The description contained in the
Prospectus under the headings "Federal Income Tax
Considerations," and "Certain United States Federal Income Tax
Considerations," while not purporting to discuss all possible
income tax ramifications of the proposed issuance, is correct
in all material respects.
Such counsel shall state that Rogers & Wells, counsel
for the Agents, may rely on its opinion.
In rendering such opinion, such counsel may (i) state
that its opinion is limited to matters governed by the Federal laws
of the United States of America, the laws of the Commonwealth of
Pennsylvania and the laws of the State of Maryland; (ii) as to
matters of Maryland law, state that its opinion is given solely in
reliance upon the opinion of Weinberg & Green LLC; (iii) state that
its opinion does not address (A) Federal Reserve Board margin
regulations; (B) Federal or state antitrust and unfair competition
laws and regulations; (C) Local Laws (as defined in The Legal
Opinion Accord of the ABA Section of Business Law (1991); (D)
compliance with fiduciary duty requirements; (E) Federal and state
racketeering laws and regulations; (F) Federal and state health and
safety laws and regulations; and (G) Federal and state laws,
regulations and policies
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concerning (x) national and local emergency, (y) possible judicial
deference to acts of foreign states, and (z) criminal and civil
forfeiture laws; and (iv) in giving the opinion referred to in
subclause (B) in Section 5(e)(A)(vii)(A), state that such opinion
with respect to the enforceability of such documents may be limited
by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors'
rights generally and by general equitable principles. Such counsel
shall also have furnished to the Agents a written statement,
addressed to the Agents and dated the Closing Date, in form and
substance satisfactory to the Agents, to the effect that (x) such
counsel has acted as counsel to the Transaction Entities in
connection with the preparation of the Registration Statement and
the Prospectus and (y) based on the foregoing, no facts have come to
the attention of such counsel which lead it to believe that the
Registration Statement, as of the Effective Date, contained any
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the
statements therein not misleading, or that the Prospectus contains
any untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading, or that any documents incorporated by
reference in the Prospectus, when they became effective or were so
filed, as the case may be, contained, in the case of a registration
statement which became effective under the Securities Act, an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and in the case of other documents which
were filed under the Securities Act of the Exchange Act with the
Commission, an untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made when such documents were so filed, not misleading. The
foregoing opinions and statement may be qualified by a statement to
the effect that such counsel does not assume any responsibility for
the accuracy, completeness or fairness of the statements contained
in the Registration Statement, the Prospectus or any documents
incorporated by reference in the Prospectus except to the extent of
the opinion contained in Section 5(e)(A)(xxv), and may state that
such counsel expresses no belief with respect to the financial
statements and notes thereto and other financial information and
data included or incorporated by reference in, or omitted from, the
Registration Statement or the Prospectus or the Statement of
Eligibility on Form T-1 of the Trustee.
(B) At the Closing Date, the Agents shall have
received the opinion, addressed to the Agents and dated the Closing
Date, of Weinberg & Green LLC, Maryland counsel to the Company, in
form and substance reasonably satisfactory to the Agents and their
counsel, to the effect that:
(i) The Company has been duly formed and is
validly existing as a real estate investment trust in good
standing under and by virtue of the laws of the State of
Maryland, is in good standing with the
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State Department of Assessments and Taxation of Maryland, and
has all trust power and authority necessary to own or hold its
properties and to conduct the business in which it is engaged
as described in the Registration Statement and the Prospectus,
and to enter into and perform its obligations under this
Agreement.
(ii) This Agreement has been duly and validly
authorized, executed and delivered by the Company, and
assuming due authorization, execution and delivery by the
Agents and the Operating Partnership, is a valid and binding
agreement of the Company.
(iii) To the knowledge of such counsel, the
execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated
hereby will not conflict with or result in any violation of
the provisions of any statute or any order, rule or regulation
of any court or governmental agency or body of the State of
Maryland that has jurisdiction over the Company or any of its
properties or assets.
(iv) The execution, delivery and performance
of this Agreement by the Company and the consummation of the
transactions contemplated hereby will not conflict with or
result in any violation of the provisions of the Declaration
of Trust or by-laws of the Company.
(v) To the knowledge of such counsel, there
are no legal or governmental proceedings pending to which the
Company is a party or of which any property or assets of the
Company is the subject which are not disclosed in the
Prospectus and which, if determined adversely to the Company,
might reasonably be expected to have a material adverse effect
on the consolidated financial position, shareholders' equity,
results of operations, business or prospects of the Company;
and to the knowledge of such counsel no such proceedings are
threatened or contemplated by governmental authorities or
threatened by others.
Such counsel shall state that Rogers & Wells, counsel
for the Agents, may rely on its opinion.
(f) The Agents shall have received from Rogers & Wells,
counsel for the Agents, such opinion or opinions, dated the Closing
Date, with respect to the issuance and sale of the Notes, the
Registration Statement, the Prospectus and other related matters as
the Agents may reasonably require, and the Company shall have
furnished to such counsel such documents as they reasonably request
for the purpose of enabling them to pass upon such matters.
(g) The Operating Partnership shall have furnished to the
Agents on the Closing Date a letter of Ernst & Young LLP, addressed
jointly to the Operating
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Partnership and the Agents and dated the Closing Date, of the type
described in the American Institute of Certified Public Accountants'
Statement on Auditing Standards No. 49, in form and substance
reasonably satisfactory to the Agents confirming that they are
independent accountants within the meaning of the Act and the
applicable published Rules and Regulations thereunder and stating in
effect that:
(i) In their opinion, the financial statements
and schedules examined by them and included in the prospectus
contained in the Registration Statement comply in form in all
material respects with the applicable accounting requirements
of the Act and the related published Rules and Regulations;
(ii) They have made a review of any unaudited
financial statements included in the Prospectus in accordance
with standards established by the American Institute of
Certified Public Accountants, as indicated in their report or
reports attached to such letter;
(iii) On the basis of the review referred to in
(ii) above and a reading of the latest available interim
financial statements of the Operating Partnership, inquiries
of officials of the Operating Partnership who have
responsibility for financial and accounting matters and other
specified procedures, nothing came to their attention that
caused them to believe that:
A. the unaudited financial statements,
if any, included in the Prospectus do not comply in form in
all material respects with the applicable accounting
requirements of the Act and the related published Rules and
Regulations or are not in conformity with generally accepted
accounting principles applied on a basis substantially
consistent with that of the audited financial statements
included in the Prospectus;
B. the unaudited capsule information,
if any, included in the Prospectus does not agree with the
amounts set forth in the unaudited consolidated financial
statements from which it was derived or was not determined on
a basis substantially consistent with that of the audited
financial statements included in the Prospectus;
C. at the date of the latest available
balance sheet read by such accountants, or at a subsequent
specified date not more than five days prior to the Closing
Date, there was any change in the capital stock, any increase
in short-term indebtedness or long-term debt of the Operating
Partnership and consolidated subsidiaries or, at the date of
the latest available balance sheet read by such accountants,
there was any decrease in consolidated net current assets or
net assets as
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compared with amounts shown on the latest balance sheet
included in the Prospectus; or
D. for the period from the date of the
latest income statement included in the Prospectus to the
closing date of the latest available income statement read by
such accountants there were any decreases, as compared with
the corresponding period of the previous year, in consolidated
rental income, total revenues, net income or in the ratio of
earnings to fixed charges;
except in all cases set forth in clauses C. and D. above for
changes, increases or decreases which the Prospectus discloses
have occurred or may occur or which are described in such
letter; and
(iv) They have compared specified dollar
amounts (or percentages derived from such dollar amounts) and
other financial information contained in the Prospectus (in
each case to the extent that such dollar amounts, percentages
and other financial information are derived from the general
accounting records of the Company and its subsidiaries subject
to the internal controls of the Company's accounting system or
are derived directly from such records by analysis or
computation) with the results obtained from inquiries, a
reading of such general accounting records and other
procedures specified in such letter and have found such dollar
amounts, percentages and other financial information to be in
agreement with such results, except as otherwise specified in
such letter.
All financial statements and schedules included in material
incorporated by reference into the Prospectus shall be deemed
included in the Prospectus for purposes of this subsection.
(h) The Transaction Entities shall have furnished to the
Agents on the Closing Date a certificate, dated the Closing Date, of
the Chairman of the Board, Chief Executive Officer, President or a
Vice President of the Company and the Chief Financial Officer,
Treasurer or an Assistant Treasurer of the Company (in each case,
for the Company and for the Company as general partner of the
Operating Partnership) stating that:
(i) The representations, warranties and
agreements of the Company in Section 1 hereof are true and
correct as of the Closing Date; each Transaction Entity has
complied with all its agreements contained herein; and the
conditions set forth in Sections 5(a) and 5(b) hereof have
been fulfilled; and
(ii) They have carefully examined the
Registration Statement and the Prospectus and, in their
opinion, (A) the Registration
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Statement, as of its effective date, did not contain any
untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to
make the statements therein not misleading, (B) the Prospectus
does not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading, and (C) since the effective date of the
Registration Statement there has not occurred any event
required to be set forth in an amended or supplemented
prospectus which has not been so set forth.
(i) (i) None of the Transaction Entities or their subsidiaries
or any Property shall have sustained any loss or interference with
its business from fire, explosion, flood or other calamity, whether
or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus, and there shall not have been any
change in the capital stock or long-term debt of either Transaction
Entity or any of their subsidiaries or any change, or any
development involving a prospective change, in or affecting any
Property Affiliate or Property or the general affairs, management,
financial position, shareholders' equity or results of operations of
either Transaction Entity, otherwise than as set forth or
contemplated in the Prospectus, the effect of which, in the judgment
of the Agents, materially impairs the investment quality of the
Notes; (ii) trading in securities generally on the New York Stock
Exchange or the American Stock Exchange or in the over-the-counter
market, or trading in any securities of the Company on any exchange
or in the over-the-counter market, shall have been suspended or
minimum prices shall have been established on any such exchange or
such market by the Commission, by such exchange or by any other
regulatory body or governmental authority having jurisdiction, (iii)
a banking moratorium shall have been declared by Federal or state
authorities, (iv) the United States shall have become engaged in
hostilities, there shall have been an escalation in hostilities
involving the United States or there shall have been a declaration
of a national emergency or war by the United States or (v) there
shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United
States shall be such), as to make it, in the judgment of a majority
in interest of the several Agents, impracticable or inadvisable to
proceed with the solicitation of offers to purchase Notes or the
purchase of Notes from the Operating Partnership as principal
pursuant to the applicable Purchase Agreement, as the case may be.
(j) Subsequent to the execution and delivery of this Agreement
(i) no downgrading shall have occurred in the rating accorded the
Operating Partnership's debt securities by any "nationally
recognized statistical rating organization," as that term is defined
by the Commission for purposes of Rule 436(g)(2) of the Rules and
Regulations and (ii) no such organization shall have
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publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any of the Operating
Partnership's debt securities.
(k) The Transaction Entities shall not have failed at or prior
to the Closing Date to have performed or complied with any of their
agreements herein contained and required to be performed or complied
with by them hereunder at or prior to the Closing Date.
(l) On the Closing Date, counsel for the Agents shall have
been furnished with such documents and opinions as they may require
for the purpose of enabling them to pass upon the issuance and sale
of the Notes as herein contemplated and related proceedings, or in
order to evidence the accuracy of any of the representations or
warranties, or the fulfillment of any of the conditions, herein
contained; and all proceedings taken by the Transaction Entities in
connection with the issuance and sale of the Notes as herein
contemplated shall be satisfactory in form and substance to the
Agents and counsel for the Agents.
(m) Prior to the Closing Date the Operating Partnership shall
have furnished or caused to be furnished to the Agents such further
certificates and documents as the Agents shall have reasonably
requested.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Agents.
Any certificate or document signed by any officer of the Transaction
Entities and delivered to the Agents, or to counsel for the Agents, shall be
deemed a representation and warranty by the Transaction Entities to each Agent
as to the statements made therein.
6. Additional Agreements of the Transaction Entities. Each of the
Transaction Entities jointly and severally agrees:
(a) Each acceptance by the Operating Partnership of an offer
for the purchase of Notes shall be deemed to be an affirmation that
the representations and warranties of the Transaction Entities
contained in this Agreement and in any certificate theretofore given
to the Agents pursuant hereto are true and correct in all material
respects at the time of such acceptance, and an undertaking that
such representations and warranties will be true and correct in all
material respects at the time of delivery to the purchaser or his
agent of the Notes relating to such acceptance as though made at and
as of each such time (and such representations and warranties shall
relate to the Registration Statement and the Prospectus as amended
or supplemented to each such time).
(b) The Operating Partnership agrees that during each
Marketing Period, each time that the Registration Statement or any
Prospectus shall be amended or supplemented (other than by a Pricing
Supplement providing solely
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for the interest rates or maturities of the Notes or the principal
amount of Notes remaining to be sold or similar changes), each time
the Operating Partnership sells Notes to an Agent as principal and
the applicable Purchase Agreement specifies the delivery of an
officers' certificate under this Section 6(b) as a condition to the
purchase of Notes pursuant to such Purchase Agreement or the
Operating Partnership files with the Commission any document
incorporated by reference into any Prospectus, the Operating
Partnership shall submit to the Agents a certificate, (i) as of the
date of such amendment, supplement, Time of Delivery relating to
such sale or filing or (ii) if such amendment, supplement or filing
was not filed during a Marketing Period, as of the first day of the
next succeeding Marketing Period, representing that the statements
contained in the certificate referred to in Section 5(h) hereof
which was last furnished to the Agents are true and correct in all
material respects at the time of such amendment, supplement or
filing, as the case may be, as though made at and as of such time
(except that such statements shall be deemed to relate to the
Registration Statement and each Prospectus as amended and
supplemented to such time).
(c) The Operating Partnership agrees that during each
Marketing Period, each time that the Registration Statement or any
Prospectus shall be amended or supplemented (other than by a Pricing
Supplement providing solely for the interest rates or maturities of
the Notes or the principal amount of Notes remaining to be sold or
similar changes), each time the Operating Partnership sells Notes to
an Agent as principal and the applicable Purchase Agreement
specifies the delivery of a legal opinion under this Section 6(c) as
a condition to the purchase of Notes pursuant to such Purchase
Agreement or the Operating Partnership files with the Commission any
document incorporated by reference into any Prospectus, the
Operating Partnership shall, (i) concurrently with such amendment,
supplement, Time of Delivery relating to such sale or filing or (ii)
if such amendment, supplement or filing was not filed during a
Marketing Period, on the first day of the next succeeding Marketing
Period, furnish the Agents and their counsel with the written
opinions of Wolf, Block, Schorr and Solis-Cohen LLP and of Weinberg
& Green LLC, each addressed to the Agents and dated the date of
delivery of such opinion, in form satisfactory to the Agents, of the
same effect as the opinions referred to in Section 5(e) hereof, but
modified, as necessary, to relate to the Registration Statement and
each Prospectus as amended or supplemented to the time of delivery
of such opinion; provided, however, that in lieu of such opinions,
each such counsel may furnish the Agents with a letter to the effect
that the Agents may rely on the applicable prior opinion to the same
extent as though it was dated the date of such letter authorizing
reliance (except that statements in such prior opinion shall be
deemed to relate to the Registration Statement and each Prospectus
as amended or supplemented to the time of delivery of such letter
authorizing reliance).
(d) The Operating Partnership agrees that during each
Marketing Period, each time that the Registration Statement or any
Prospectus shall be amended or supplemented to include additional
financial information, each time
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the Operating Partnership sells Notes to an Agent as principal and
the applicable Purchase Agreement specifies the delivery of a letter
under this Section 6(d) as a condition to the purchase of Notes
pursuant to such Purchase Agreement or the Operating Partnership
files with the Commission any document incorporated by reference
into any Prospectus which contains additional financial information,
the Operating Partnership shall cause Ernst & Young LLP (or other
independent accounts of the Operating Partnership acceptable to the
Agents to furnish the Agents, (i) concurrently with such amendment,
supplement, Time of Delivery relating to such sale or filing or (ii)
if such amendment, supplement, or filing was not filed during a
Marketing Period, on the first day of the next succeeding Marketing
Period, a letter, addressed jointly to the Operating Partnership and
the Agents and dated the date of delivery of such letter, in form
and substance reasonably satisfactory to the Agents, of the same
effect as the letter referred to in Section 5(g) hereof but modified
to relate to the Registration Statement and each Prospectus, as
amended and supplemented to the date of such letter, with such
changes as may be necessary to reflect changes in the financial
statements and other information derived from the accounting records
of the Operating Partnership; provided, however, that if the
Registration Statement or any Prospectus is amended or supplemented
solely to include financial information as of and for a fiscal
quarter, such accountants may limit the scope of such letter to the
unaudited financial statements included in such amendment or
supplement unless there is contained therein any other accounting,
financial or statistical information that, in the reasonable
judgment of the Agents, should be covered by such letter, in which
event such letter shall also cover such other information.
(e) On any settlement date for the sale of Notes, the
Operating Partnership shall, if requested by the Agent that
solicited or received the offer to purchase any Notes being
delivered on such settlement date, furnish such Agent with the
written opinions of Wolf, Block, Schorr and Solis Cohen LLP and
Weinberg & Green LLC, each dated such settlement date, in form
satisfactory to such Agent, to the effect set forth in section 5(e)
hereof, but modified, as necessary, to relate to the Prospectus
relating to the Notes to be delivered on such settlement date;
provided, however, that in lieu of such opinions, each such counsel
may furnish the Agents with letters to the effect that the Agents
may rely on the applicable prior opinion to the same extent as
though it was dated such settlement date (except that statements in
such prior opinion shall be deemed to relate to the Registration
Statement and such Prospectus as amended or supplemented to the time
of delivery of such letter authorizing reliance).
7. Indemnification and Contribution.
(a) The Transaction Entities, jointly and severally, shall
indemnify and hold harmless each Agent, its officers and employees
and each person, if any, who controls any Agent within the meaning
of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability
or action relating
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to solicitations of offers to purchase and purchases of Notes from
the Operating Partnership by an Agent as Principal), to which such
Agent, officer, employee or controlling person may become subject,
under the Securities Act, the Exchange Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of
a material fact contained (A) the Registration Statement or the
Prospectus or in any amendment or supplement thereto or (B) in any
blue sky application or other document prepared or executed by the
Operating Partnership (or based upon any written information
furnished by the Operating Partnership) specifically for the purpose
of qualifying any or all of the Notes under the securities laws of
any state or other jurisdiction (any such application, document or
information being hereinafter called a "Blue Sky Application"), (ii)
the omission or alleged omission to state in the Registration
Statement or the Prospectus, or in any amendment or supplement
thereto, or in any Blue Sky Application any material fact required
to be stated therein or necessary to make the statements therein not
misleading (with respect to the Prospectus, in light of the
circumstances under which they were made), and shall reimburse each
Agent, officer, employee or controlling person for any legal and
other expenses reasonably incurred by such Agent, officer, employee
or controlling person in investigating or defending or preparing to
defend against such loss, claim, damage, liability or action;
provided, however, that the Transaction Entities shall not be liable
in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement or omission or alleged
omission made in the Registration Statement or the Prospectus, or in
any such amendment or supplement, or in any Blue Sky Application, in
reliance upon and in conformity with written information furnished
to the Transaction Entities through the Agents by or on behalf of
any Agent specifically for inclusion therein; provided further, that
as to any prospectus included in the Registration Statement before
it became effective under the Securities Act (a "Preliminary
Prospectus") this indemnity agreement shall not inure to the benefit
of any Agent on account of any loss, claim, damage, liability or
action arising from the sale of Notes to any person by that Agent if
that Agent failed to send or give a copy of the Prospectus, as the
same may be amended or supplemented, to that person within the time
required by the Act, and the untrue statement or alleged untrue
statement of a material fact or omission or alleged omission to
state a material fact in such Preliminary Prospectus was corrected
in the Prospectus, unless such failure resulted from non-compliance
by the Operating Partnership with Section 3(b). The foregoing
indemnity agreement is in addition to any liability which the
Transaction Entities may otherwise have to any Agent or to any
officer, employee or controlling person of that Agent.
(b) Each Agent, severally and not jointly, shall indemnify and
hold harmless each Transaction Entity, each of its directors, its
officers who signed the Registration Statement and each person, if
any, who controls each Transaction Entity within the meaning of the
Securities Act, from and against any loss, claim,
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damage or liability, joint or several, or any action in respect
thereof, to which each Transaction Entity or any such director,
officer or controlling person may become subject, under the
Securities Act, the Exchange Act or other federal or state statutory
law or regulation, at common law or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material
fact contained (A) in the Registration Statement or the Prospectus
or in any amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in the
Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any material fact
required to be stated therein or necessary to make the statements
therein not misleading, but in each case only to the extent that the
untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written
information furnished to the Transaction Entities through the Agents
by or on behalf of that Agent specifically for inclusion therein,
and shall reimburse each Transaction Entity and any such director,
officer or controlling person for any legal or other expenses
reasonably incurred by each Transaction Entity or any such director,
officer or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim,
damage, liability or action. The foregoing indemnity agreement is in
addition to any liability which any Agent may otherwise have to each
Transaction Entity or any such director, officer, or controlling
person.
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of any claim or the commencement of any action,
the indemnified party shall, if a claim in respect thereof is to be
made against the indemnifying party under this Section 7, notify the
indemnifying party in writing of the claim or the commencement of
that action; provided, however, that the failure to notify the
indemnifying party shall not relieve it from any liability which it
may have under this Section 7 except to the extent it has been
materially prejudiced by such failure and, provided further, that
the failure to notify the indemnifying party shall not relieve it
from any liability which it may have to an indemnified party
otherwise than under this Section 7. If any such claim or action
shall be brought against an indemnified party, and it shall notify
the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes,
jointly with any other similarly notified indemnifying party, to
assume the defense thereof with counsel reasonably satisfactory to
the indemnified party. After notice from the indemnifying party to
the indemnified party of its election to assume the defense of such
claim or action, the indemnifying party shall not be liable to the
indemnified party under this Section 7 for any legal or other
expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, that the indemnified party shall
have the right to employ counsel to represent jointly the Agents and
their respective officers, employees and controlling persons who may
be subject to liability arising out of any claim in respect of which
indemnity may be sought by the Agents against the Transaction
Entities under this Section 7 if,
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in the reasonable judgment of the Agents, it is advisable for the
Agents and those officers, employees and controlling persons to be
jointly represented by separate counsel, and in that event the fees
and expenses of such separate counsel shall be paid by the
Transaction Entities. No indemnifying party shall be liable for any
settlement of any proceeding effected without its written consent,
but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing
sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees
and expenses of counsel, the indemnifying party agrees that is shall
be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30
days after receipt by such indemnifying party of the aforesaid
request and (ii) such indemnifying party shall not have reimbursed
the indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of
which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the
subject matter of such proceeding.
(d) If the indemnification provided for in this Section 7
shall for any reason be unavailable to an indemnified party under
Section 7(a) or 7(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein,
then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such
indemnified party as a result of such loss, claim, damage or
liability, or action in respect thereof, (i) in such proportion as
shall be appropriate to reflect the relative benefits received by
the Transaction Entities on the one hand and the Agents on the other
from the offering of the Notes or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault
of the Transaction Entities on the one hand and the Agents on the
other with respect to the statements or omissions which resulted in
such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations. The relative
benefits received by the Transaction Entities on the one hand and
the Agents on the other with respect to such offering shall be
deemed to be in the same proportion as the total net proceeds from
the offering of the (before deducting expenses) received by the
Transaction Entities bears to the total commissions received by the
Agents with respect to such offering. The relative fault shall be
determined by reference to whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the
Transaction Entities or the Agents, the intent of the parties and
their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Transaction
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Entities and the Agents agree that it would not be just and
equitable if contributions pursuant to this Section were to be
determined by pro rata allocation (even if the Agents were treated
as one entity for such purpose) or by any other method of allocation
which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action
in respect thereof, referred to above in this Section shall be
deemed to include, for purposes of this Section 7(d), any legal or
other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7(d), no Agent shall
be required to contribute any amount in excess of the amount by
which the total price at which the Notes sold through such Agent and
distributed to the public were offered to the public exceeds the
amount of any damages which such Agent has otherwise paid or become
liable to pay by reason of any untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
8. Status of Each Agent. In soliciting offers to purchase the Notes
from the Operating Partnership pursuant to this Agreement (other than in respect
of any Purchase Agreement), each Agent is acting individually and not jointly
and is acting solely as agent for the Operating Partnership and not as
principal. Each Agent will make reasonable efforts to assist the Operating
Partnership in obtaining performance by each purchaser whose offer to purchase
Notes from the Operating Partnership has been solicited by such Agent and
accepted by the Operating Partnership but such Agent shall have no liability to
the Operating Partnership in the event any such purchase is not consummated for
any reason. If the Operating Partnership shall default in its obligations to
deliver Notes to a purchaser whose offer it has accepted, the Operating
Partnership shall (i) hold the Agents harmless against any loss, claim or damage
arising from or as a result of such default by the Operating Partnership and
(ii), in particular, pay to the Agents any commission to which they would be
entitled in connection with such sale.
9. Termination. This Agreement may be terminated for any reason with
respect to any party hereto, at any time, by any party hereto upon the giving of
one day's written notice of such termination to the other parties hereto;
provided, however, if such terminating party is an Agent, such termination shall
be effective only with respect to such terminating party. If, at the time of a
termination, an offer to purchase any of the Notes has been accepted by the
Operating Partnership but the time of delivery to the purchaser has not
occurred, the provisions of this Agreement shall remain in effect until such
Notes are delivered. The provisions of Sections 2(c), 3(f), 3(j), 3(k), 4, 7, 8
and 12 hereof shall survive any termination of this Agreement.
10. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
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(a) if to the Agents, shall be delivered or sent by mail,
telex or facsimile transmission to: Lehman Brothers Inc., Three
World Financial Center, New York, New York 10285, Attention: Medium
Term Note Department, 9th Floor; Telephone No. (212) 640-8400; Fax
No.: (212) 528-7035, with a copy, in the case of any notice pursuant
to Section 7(c), to the Director of Litigation, Office of the
General Counsel, Lehman Brothers Inc., 3 World Financial Center,
10th Floor, New York, NY 10285; Donaldson, Lufkin & Jenrette
Securities Corporation, Corporate Syndicate, 277 Park Avenue, Ninth
Floor, New York, New York, 10172 telephone: (212) 892-4807, fax
number:(212) 892-2682; First Chicago Capital Markets, Inc., One
First National Plaza, Suite 0307, Chicago, Illinois 60670,
Attention: Operations Manager, Medium Term Notes/Cherie McNight,
(312) 732-9633, telecopier: (312) 732-7966; J.P. Morgan Securities
Inc., 60 Wall Street, 3d Floor, New York, New York 10260,
Attention: MTN Trading Desk, (212) 648-0591, telecopier:
(212) 648-5909; UBS Securities LLC, 299 Park Avenue, 26th Floor, New
York, New York 10171, Attention: Richard Messina, (212) 821-4542,
telecopier: (212) 821-3667;
(b) if to the Transaction Entities, shall be delivered or sent
by mail, telex or facsimile transmission to the Company, 65 Valley
Stream Parkway, Malvern, PA 19355, Attention: General Counsel (Fax:
610-644-2175);
provided, however, that any notice to an Agent pursuant to Section 7(c) shall be
delivered or sent by mail, telex or facsimile transmission to such Agent at its
address set forth in its acceptance telex to the Agents, which address will be
supplied to any other party hereto by the Agents upon request. Any such
statements, requests, notices or agreements shall take effect at the time of
receipt thereof. The Transaction Entities shall be entitled to act and rely upon
any request, consent, notice or agreement given or made on behalf of the Agents
by Lehman Brothers Inc.
11. Persons Entitled to Benefit of Agreement. This Agreement shall
inure to the benefit of and be binding upon the Agents, the Transaction Entities
and their respective personal representatives and successors. This Agreement and
the terms and provisions hereof are for the sole benefit of only those persons,
except that (A) the representations, warranties, indemnities and agreements of
the Transaction Entities contained in this Agreement shall also be deemed to be
for the benefit of the person or persons, if any, who control any Agent within
the meaning of Section 15 of the Securities Act and (B) the indemnity agreement
of the Agents contained in Section 7 of this Agreement shall be deemed to be for
the benefit of trustees of the Company, officers of the Company who have signed
the Registration Statement and any person controlling the Transaction Entities
within the meaning of section 15 of the Securities Act. Nothing in this
Agreement is intended or shall be construed to give any person, other than the
persons referred to in this Section 11, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein.
12. Survival. The respective indemnities, representations,
warranties and agreements of the Transaction Entities and the Agents contained
in this Agreement or made by or on behalf on them, respectively, pursuant to
this Agreement, shall survive each delivery of and payment for any of the Notes
and shall remain in full force and effect, regardless of any
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investigation made by or on behalf of any of them or any person controlling any
of them, and shall survive each delivery of and payment for any of the Notes.
13. Sales Of Notes Denominated In A Foreign Currency And Indexed
Notes. If at any time the Operating Partnership and any of the Agents shall
determine to issue and sell Notes denominated in a currency or currency unit
other than U.S. Dollars, which other currency may include a composite currency,
or with respect to which an index is used to determine the amounts of payments
of principal and any premium or interest, the Company and any such Agent shall
execute and deliver an Amendment (a "Foreign Currency Amendment" or "Indexed
Note Amendment," as the case may be) in the form attached hereto as Exhibit D.
Such amendment shall establish, as appropriate additions and modifications that
shall apply to the sales, whether offered on an agency or principal basis, of
the Notes covered thereby. The Agents are authorized to solicit offers to
purchase Notes with respect to which an index is used to determine the amounts
of payments of principal and any premium and interest, and the Company shall
agree to any sales of such Notes (whether offered on an agency or principal
basis), only in a minimum aggregate amount of $2,500,000.
14. Definition of the Term "subsidiary". For purposes of this
Agreement, "subsidiary" has the meaning set forth in Rule 405 of the Rules and
Regulations.
15. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of New York.
16. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
17. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
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If the foregoing correctly sets forth the agreement between the
Company and the Agents, please indicate your acceptance in the space provided
for that purpose below.
Very truly yours,
LIBERTY PROPERTY TRUST
By /s/ Willard G Rouse III
-------------------------------------------
Name: Willard G. Rouse III
Title: Chairman of the Board and Chief
Executive Officer
LIBERTY PROPERTY LIMITED PARTNERSHIP
By: Liberty Property Trust, its sole general partner
By /s/ Willard G. Rouse III
-------------------------------------------
Name: Willard G. Rouse III
Title:Chairman of the Board and
Chief Executive Officer
Confirmed and Accepted, as of the date first above written:
LEHMAN BROTHERS INC.
By: /s/ Bart McDade
- ----------------------------------------
Authorized Representative
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
By: /s/ Roger Thompson
- ----------------------------------------
Name: Roger Thompson
Title: Senior Vice President
47
FIRST CHICAGO CAPITAL MARKETS, INC.
By: /s/ Evonne W. Taylor
Name: Evonne W. Taylor
Title: Vice President
J.P. MORGAN SECURITIES INC.
By: /s/ Keysha Bailey
Name: Keysha Bailey
Title: Vice President
UBS SECURITIES LLC
By: /s/ Richard Messina
Name: Richard Messina
Title: Director
48
SCHEDULE A
LIBERTY PROPERTY LIMITED PARTNERSHIP
MEDIUM-TERM NOTES, SERIES A
SCHEDULE OF PAYMENTS
The Operating Partnership agrees to pay each Agent a commission equal to
the following percentage of the aggregate U.S. dollar equivalent of the
principal amount of Notes:
=========================================================
TERM COMMISSION RATE
- ---------------------------------------------------------
9 months to less than 12 months 0.125%
- ---------------------------------------------------------
12 months to less than 18 months 0.150%
- ---------------------------------------------------------
18 months to less than 2 years 0.200%
- ---------------------------------------------------------
2 years to less than 3 years 0.250%
- ---------------------------------------------------------
3 years to less than 4 yearS 0.350%
- ---------------------------------------------------------
4 years to less than 5 years 0.450%
- ---------------------------------------------------------
5 years to less than 6 years 0.500%
- ---------------------------------------------------------
6 years to less than 7 years 0.550%
- ---------------------------------------------------------
7 years to less than 10 years 0.600%
- ---------------------------------------------------------
10 years to less than 15 years 0.625%
- ---------------------------------------------------------
15 years to less than 20 years 0.650%
- ---------------------------------------------------------
20 years to 30 years 0.750%
- ---------------------------------------------------------
More than 30 years to be negotiated
at time of sale
=========================================================
49
EXHIBIT A
The following terms, if applicable, shall be agreed to by one or more
Agents and the Operating Partnership in connection with each sale of Notes:
Principal Amount: $____________
(or principal amount of foreign currency or composite currency)
Interest Rate or Formula:
If Fixed Rate Note,
Interest Rate:
Default Rate:
Interest Payment Dates:
If Floating Rate Note,
Interest Rate Basis(es):
If LIBOR,
/ / LIBOR Reuters
Page:
/ / LIBOR Telerate
Page:
Designated LIBOR Currency:
If CMT Rate,
Designated CMT Telerate Page:
Designated CMT Maturity Index:
Index Maturity:
Spread and/or Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Payment Dates:
Default Rate:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Fixed Interest Rate, if any:
Calculation Agent:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
50
If Repayable:
Optional Repayment Date(s):
Original Issue Date:
Stated Maturity Date:
Specified Currency:
Exchange Rate Agent:
Authorized Denomination:
Purchase Price: ___%, plus accrued interest, if any, from ___________
Closing Date and Time:
Additional/Other Terms:
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EXHIBIT B
LIBERTY PROPERTY LIMITED PARTNERSHIP
MEDIUM-TERM NOTES, SERIES A
ADMINISTRATIVE PROCEDURES
Medium-Term Notes Due Nine Months or More from Date of Issuance, Series A
(the "Notes") are to be offered on a continuing basis by Liberty Property
Limited Partnership (the "Operating Partnership"). Lehman Brothers Inc.,
Donaldson, Lufkin & Jenrette Securities Corporation, First Chicago Capital
Markets, Inc., J.P. Morgan Securities Inc. and UBS Securities LLC, as agents
(each, an "Agent" and collectively, the "Agents"), have each agreed to use their
reasonable best efforts to solicit offers to purchase the Notes. The Notes are
being sold pursuant to a Distribution Agreement between the Operating
Partnership, Liberty Property Trust, a Maryland real estate investment trust,
its General Partner, and the Agents dated October 24, 1997 (as it may be
supplemented or amended from time to time, the "Distribution Agreement") to
which these administrative procedures are attached as an exhibit. The Notes will
be issued under an indenture dated October 24, 1997 between the Operating
Partnership and The First National Bank of Chicago, as trustee (the "Trustee"),
as heretofore supplemented. The Notes will rank equally with all other unsecured
and unsubordinated indebtedness of the Operating Partnership and will have been
registered with the Securities and Exchange Commission (the "Commission"). Terms
defined in the Prospectus relating to the Notes (the "Prospectus") and in the
Distribution Agreement shall have the same meaning when used in this exhibit.
Special administrative procedures for Multi-Currency Notes and for Global
Securities relating to Book-Entry Notes follow these administrative procedures.
Administrative responsibilities, document control and record-keeping
functions to be performed by the Operating Partnership will be performed by its
Chief Financial Officer. Administrative procedures for the offering are
explained below.
PRICE TO PUBLIC
Each Note will be issued at 100% of principal amount, unless otherwise
determined by the Operating Partnership.
DATE OF ISSUANCE
Each Note will be dated and issued as of the date of its authentication by
the Trustee.
MATURITIES
Each Note will mature on a Business Day (as defined below) selected by the
purchaser and agreed upon by the Operating Partnership, such date being at least
nine months from the date
52
of issuance. Each Floating Rate Note will mature on an Interest Payment Date (as
defined below).
"Business Day" shall mean any day which is not a Saturday or Sunday and
which is not a day on which banking institutions are generally authorized or
required by law to close in the City of New York.
REGISTRATION
Notes will be issued only in fully registered form as either a Book-Entry
Note or a Certificated Note. Certificated Notes may be presented for
registration of transfer or exchange at the Trustee's New York office.
DENOMINATIONS
The Notes (other than Notes represented by Global Securities) will be
issued and payable in U.S. dollars in the denomination of $100,000 and any
larger denomination which is an integral multiple of $1,000.
INTEREST PAYMENTS
Each Note bearing interest at a fixed rate (a "Fixed Rate Note") will bear
interest from its issue date at the annual rate stated on the face thereof,
payable on _____________ and ______________ of each year (each an "Interest
Payment Date" with respect to such Fixed Rate Note) and at Stated Maturity or
upon redemption, if applicable.
Special provisions are set forth in the Prospectus relating to Notes
bearing interest at a rate or rates determined by reference to an interest rate
formula ("Floating Rate Notes") at a rate determined pursuant to the formula
stated on the face thereof, payable in arrears on such dates as are specified
therein (each an "Interest Payment Date" with respect to such Floating Rate
Note).
Interest on Fixed Rate Notes will be calculated and paid on the basis of a
360-day year of twelve 30-day months. Interest will be payable to the person in
whose name such Note is registered at the close of business on the fifteenth day
(whether or not a Business Day) next preceding an Interest Payment Date with
respect to Floating Rate Notes (the "Record Dates") next preceding the
respective Interest Payment Date; provided, however, that interest payable at
Stated Maturity will be payable to the person to whom principal shall be
payable. Any payment of principal and interest on such Note required to be paid
on an Interest Payment Date or at Stated Maturity or upon redemption, if
applicable, which is not a Business Day shall be postponed to the next day which
is a Business Day. The first payment of interest on any Note originally issued
between a Record Date and an Interest Payment Date will be made on the Interest
Payment Date following the next succeeding Record Date. All interest payments,
excluding interest payments made at Stated Maturity or upon redemption, if
applicable, will be made by check mailed to the person entitled thereto as
provided above, or, at the option of the Operating Partnership, by wire transfer
to an account maintained by such person with a bank located in the
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United States. Notwithstanding the foregoing, the holder of $1 million or more
in aggregate principal amount of Notes with the same Interest Payment Date may
request payment by wire transfers.
On the fifth Business Day immediately preceding each Interest Payment
Date, the Trustee will furnish the Operating Partnership with the total amount
of the interest payments to be made on such Interest Payment Date. The Trustee
(or any duly selected paying agent) will provide monthly to the Operating
Partnership's Treasury Department a list of the principal and interest to be
paid on Notes maturing in the next succeeding month. The Operating Partnership
will provide to the Trustee not later than the payment date sufficient moneys to
pay in full all principal and interest payments due on such payment date. The
Trustee will assume responsibility for withholding taxes on interest paid as
required by law.
ACCEPTANCE AND REJECTION OF OFFERS
The Operating Partnership shall have the sole right to accept offers to
purchase Notes and may reject any such offer in whole or in part. Each Agent
shall promptly communicate to the Operating Partnership, orally or in writing,
each reasonable offer to purchase Notes from the Operating Partnership received
by it other than those rejected by such Agent. Each Agent shall have the right,
in its discretion reasonably exercised without advising the Operating
Partnership, to reject any offers in whole or in part.
SETTLEMENT
The receipt of immediately available funds in U.S. Dollars by the
Operating Partnership in payment for a Note (less the applicable commission) and
the authentication and issuance of such Note shall, with respect to such Note,
constitute "Settlement." All offers accepted by the Operating Partnership will
be settled from one to five Business Days from the date of acceptance by the
Operating Partnership pursuant to the timetable for Settlement set forth below
unless the Operating Partnership and the purchaser agree to Settlement on a
later date; provided, however, that the Operating Partnership will so notify the
Trustee of any such later date on or before the Business Day immediately prior
to the Settlement date.
SETTLEMENT PROCEDURES
In the event of a purchase of Notes by an Agent, as principal, appropriate
Settlement details will be set forth in the applicable Purchase Agreement to be
entered into between such Agent and the Operating Partnership pursuant to the
Distribution Agreement. In the event of the sale of a Multi-Currency Note or an
Indexed Note, additional or different Settlement details may be set forth in the
applicable Amendment to be entered into between the Agent and the Operating
Partnership pursuant to the Distribution Agreement.
Settlement procedures with regard to each Note sold through each Agent
shall be as follows:
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54
A. Such Agent (the "Presenting Agent") will advise the Operating
Partnership by telephone, telex or facsimile, of the following Settlement
information:
1. Exact name in which the Note is to be registered ("Registered
Owner").
2. Exact address of the Registered Owner and address for payment
of principal and interest, if any.
3. Taxpayer identification number of the Registered Owner.
4. Principal amount of the Note (and, if multiple Notes are to be
issued, denominations thereof).
5. Settlement date.
6. Stated Maturity.
7. Issue Price and any OID information.
8. Trade Date/Original Issue Date.
9. Interest rate:
(a) Fixed Rate Notes:
(i) interest rate
(ii) overdue rate, if any
(b) Floating Rate Notes:
(i) interest rate basis
(ii) initial interest rate
(iii) spread or spread multiplier, if any
(iv) interest rate reset periods
(v) interest payment dates
(vi) index maturity
(vii) maximum and minimum interest rates, if any
(viii) record dates
(ix) interest determination dates
(x) overdue rate, if any
10. The date on or after which the Notes are redeemable at the option of
the Operating Partnership, and additional redemption or repurchase
provisions, if any.
11. Wire transfer information.
B-4
55
12. Presenting Agent's Commission (to be paid in the form of a discount
from the proceeds remitted to the Operating Partnership upon
Settlement).
B. The Operating Partnership will confirm the above Settlement information
to the Trustee by telephone, telex or facsimile, and the Trustee will assign a
Note number to the transaction. If the Operating Partnership rejects an offer,
the Operating Partnership will promptly notify the Presenting Agent and the
Trustee by telephone.
C. The Trustee will complete the first page of the preprinted 4-ply Note
packet [Note: Such a packet need not be prepared if the Operating Partnership is
utilizing the book-entry system, see procedures below, the form of which was
previously approved by the Operating Partnership, the Agents and the Trustee.]
D. The Trustee will deliver the Note (with the attached white
confirmation) and the yellow and blue stubs to the Agent. The Presenting Agent
will acknowledge receipt of the Note by completing the yellow stub and returning
it to the Trustee.
E. The Presenting Agent will cause to be wire transferred to a bank
account designated by the Operating Partnership immediately available funds in
U.S. dollars in the amount of the principal amount of the Note, less the
applicable commission or discount, if any.
F. The Presenting Agent will deliver the Note (with the attached white
confirmation) to the purchaser against payment in immediately available funds in
the amount of the principal amount of the Note. The Presenting Agent will
deliver to the purchaser a copy of the most recent Prospectus applicable to the
Note with or prior to any written offer of Notes, delivery of the Note and the
confirmation and payment by the purchaser for the Note.
G. The Presenting Agent will obtain the acknowledgement of receipt for the
Note and Prospectus by the purchaser through the purchaser's completion of the
blue stub.
H. The Trustee will mail the pink stub to the Operating Partnership's
Treasurer.
SETTLEMENT PROCEDURES TIMETABLE
For offers accepted by the Operating Partnership, Settlement procedures
"A" through "H" set forth above shall be completed on or before the respective
times set forth below:
B-5
56
=========================================================
SETTLEMENT
PROCEDURE TIME (NEW YORK)
=========================================================
A 5 PM on date of order
- ---------------------------------------------------------
B 3 PM on the Business Day prior to
Settlement Date
- ---------------------------------------------------------
C-D 12 Noon on the Settlement Date
- ---------------------------------------------------------
E 2:15 PM on the Settlement date
- ---------------------------------------------------------
F-G 3 PM on the Settlement Date
- ---------------------------------------------------------
H 5 PM on Business Day after the
Settlement Date
=========================================================
FAILS
In the event that a purchaser of a Note shall either fail to accept
delivery of or make payment for such Note on the date fixed by the Operating
Partnership for Settlement, the Presenting Agent will immediately notify the
Trustee and the Operating Partnership's Treasurer by telephone, confirmed in
writing, of such failure and return the Note to the Trustee. Upon the Trustee's
receipt of the Note from the Presenting Agent, the Operating Partnership will
promptly return to the Presenting Agent an amount of immediately available funds
in U.S. dollars equal to any amount previously transferred to the Operating
Partnership in respect of the Note pursuant to advances made by the Agent. Such
returns will be made on the Settlement date, if possible, and in any event not
later than 12 noon (New York City time) on the Business Day following the
Settlement date. The Operating Partnership will reimburse the Presenting Agent
on an equitable basis for its loss of the use of the funds during the period
when the funds were credited to the account of the Operating Partnership. Upon
receipt of the Note in respect of which the default occurred, the Trustee will
mark the Note "cancelled," make appropriate entries in its records and deliver
the Note to the Operating Partnership with an appropriate debit advice. The
Presenting Agent will not be entitled to any commission with respect to any Note
which the purchaser does not accept or make payment for.
PRICING REDEMPTION
Except as otherwise specified in the applicable Pricing Supplement and on
the Notes, the Notes will not be redeemable prior to their Stated Maturity. If
so specified in a Pricing Supplement and on the Note, such Note will be subject
to redemption by the Operating Partnership, at any time on or after the date set
forth on such supplement and the Note, in whole or from time to time in part, at
the option of the Operating Partnership, at the redemption price set forth
therein, together with interest accrued thereon on the date of redemption.
Notice of redemption shall be given by first-class mail postage prepaid,
mailed not less than 30 days nor more than 60 days prior to the date of
redemption, to each holder of Notes to
B-6
57
be redeemed, in the manner and in accordance with the Indenture. In the event of
redemption in part of any Note, a new Note for the amount of the unredeemed
portion shall be issued in the name of the Holder upon cancellation of the
redeemed Note.
MATURITY
Upon presentation of each Note at Maturity the Trustee (or any duly
appointed Paying Agent) will pay the principal amount thereof, together with
accrued interest through the date of redemption. Such payment shall be made in
immediately available funds in U.S. dollars, provided that the Note is presented
to the Trustee (or any such Paying Agent) in time for the Trustee (or such
Paying Agent) to make payments in such funds in accordance with its normal
procedures. The Operating Partnership will provide the Trustee (and any such
Paying Agent) with funds available for immediate use for such purpose. Notes
presented at Maturity will be cancelled by the Trustee as provided in the
Indenture.
PROCEDURES FOR ESTABLISHING THE TERMS OF THE NOTES
The Operating Partnership and the Agents will discuss from time to time
the rates to be borne by the Notes that may be sold as a result of the
solicitation of offers by the Agents. Once any Agent has recorded any indication
of interest in Notes upon certain terms, and communicated with the Operating
Partnership, if the Operating Partnership accepts an offer to purchase Notes
upon such terms, it will prepare a Pricing Supplement in the form previously
approved by the Agents, reflecting the terms of such Notes and, after approval
from the Presenting Agent, will arrange to have 10 copies of such Pricing
Supplement (together with the Prospectus, if amended or supplemented) filed with
the Commission and will supply an appropriate number of copies of the
Prospectus, as then amended or supplemented, together with such Pricing
Supplement, to the Presenting Agent. See "Delivery of Prospectus." No
settlements with respect to Notes upon such terms may occur prior to such filing
and the Presenting Agent will not, prior to such filing, mail confirmations to
customers who have offered to purchase Notes upon such terms. After such filing,
sales, mailing of confirmations and settlements may occur with respect to Notes
upon such terms, subject to the provisions of "Delivery of Prospectus" below.
If the Operating Partnership decides to post rates and a decision has been
reached to change interest rates, the Operating Partnership will promptly notify
each Agent. Each Agent will forthwith suspend solicitation of purchases. At that
time, the Agents will recommend and the Operating Partnership will establish
rates to be so "posted." Following establishment of posted rates and prior to
the filing described in the following sentence, the Agents may only record
indications of interest in purchasing Notes at the posted rates. Once any Agent
has recorded any indication of interest in Notes at the posted rates and
communicated with the Operating Partnership, if the Operating Partnership plans
to accept an offer at the posted rate, it will prepare a Pricing Supplement
reflecting such posted rates and, after approval from the Presenting Agent, will
arrange to have 10 copies of such Pricing Supplement (together with the
Prospectus if amended or supplemented) filed with the Commission and will supply
an appropriate number of copies of the Prospectus, as then amended or
supplemented, to the Presenting Agent. See "Delivery of Prospectus." No
settlements at the posted rates may occur prior to such filing and the
Presenting Agent will not, prior to such filing, mail confirmations to
B-7
58
customers who have offered to purchase Notes at the posted rates. After such
filing, sales, mailing of confirmations and settlements may resume, subject to
the provisions of "Delivery of Prospectus" below.
SUSPENSION OF SOLICITATION; AMENDMENT OR SUPPLEMENT
In the event that at the time the Agents, at the direction of the
Operating Partnership, suspends solicitation of offers to purchase from the
Operating Partnership there shall be any orders outstanding which have not been
settled, the Operating Partnership will promptly advise the Agents and the
Trustee whether such orders may be settled and whether copies of the Prospectus
as theretofore amended and/or supplemented as in effect at the time of the
suspension may be delivered in connection with the settlement of such orders.
The Operating Partnership will have the sole responsibility for such decision
and for any arrangements which may be made in the event that the Operating
Partnership determines that such orders may not be settled or that copies of
such Prospectus may not be so delivered.
DELIVERY OF PROSPECTUS
A copy of the Prospectus as most recently amended or supplemented on the
date of delivery thereof, together with the applicable Pricing Supplement, must
be delivered to a purchaser prior to or together with the earlier of the
delivery of (i) the written confirmation of a sale sent to a purchaser or his
agent and (ii) any Note purchased by such purchaser. The Operating Partnership
shall ensure that the Presenting Agent receives copies of the Prospectus and
each amendment or supplement thereto (including the applicable Pricing
Supplement) in such quantities and within such time limits as will enable the
Presenting Agent to deliver such confirmation or Note to a purchaser as
contemplated by these procedures and in compliance with the preceding sentence.
Copies of Pricing Supplements should be delivered to the applicable address: if
to Lehman Brothers Inc., to c/o ADP, Prospectus Services, 536 Broad Hollow Road,
Melville, New York 11747, Attention: Mike Ward, (516) 254-7106, telecopier:
(516) 249-7942 and by hand to Lehman Brothers Inc., 3 World Financial Center,
9th floor, New York, New York 10285, Attention: Brunnie Vazquez, (212) 526-8400;
if to Donaldson, Lufkin & Jenrette Securities Corporation, to: Corporate
Syndicate, 277 Park Avenue, Ninth Floor, New York, New York, 10172. telephone:
(212) 892-4807, fax number: (212) 892-2682; if to First Chicago Capital
Markets, Inc., to: First Chicago Capital Markets, Inc., One First National
Plaza, Suite 0307, Chicago, Illinois 60670, Attention: Operations Manager,
Medium Term Notes/ Cherie McNight, (312) 732-9633, telecopier: (312) 732-7966;
if to J.P. Morgan Securities Inc., to: J.P. Morgan Securities Inc., 60 Wall
Street, 3d Floor, New York, New York 10260, Attention: MTN Trading Desk,
(212) 648-0591, telecopier: (212) 648-5909; if to UBS Securities LLC, to:
UBS Securities LLC, 299 Park Avenue, 26th Floor, New York, New York 10171,
Attention: Richard Messina, (212) 821-4542, telecopier: (212)
821-3667; with a copy to Rogers & Wells, 200 Park Avenue, New York, New York
10166, Attention: Robert E. King, Jr., Esq. If, since the date of acceptance of
a purchaser's offer, the Prospectus shall have been supplemented solely to
reflect any sale of Notes on terms different from those agreed to between the
Operating Partnership and such purchaser or a change in posted rates not
applicable to such purchaser, such purchaser shall not receive the Prospectus as
supplemented by such new supplement, but shall receive the Prospectus as
supplemented to reflect the terms of the Notes being purchased by such purchaser
and otherwise
B-8
59
as most recently amended or supplemented on the date of delivery of the
Prospectus. The Trustee will make all such deliveries with respect to all Notes
sold directly by the Operating Partnership.
AUTHENTICITY OF SIGNATURES
The Operating Partnership will cause the Trustee to furnish the Agents
from time to time with the specimen signatures of each of the Trustee's
officers, employees and agents who have been authorized by the Trustee to
authenticate Notes, but the Agents will have no obligation or liability to the
Operating Partnership or the Trustee in respect of the authenticity of the
signature of any officer, employee or agent of the Operating Partnership or the
Trustee on any Note.
ADVERTISING COSTS
The Operating Partnership will determine with the Agents the amount and
nature of advertising that may be appropriate in offering the Notes. Advertising
expenses incurred with the consent of the Operating Partnership will be paid by
the Operating Partnership.
B-9
60
SPECIAL ADMINISTRATIVE PROCEDURES
FOR MULTI-CURRENCY NOTES
Unless otherwise set forth in an applicable Foreign Currency Amendment,
the following procedures and terms shall apply to Multi-Currency Notes in
addition to, and to the extent inconsistent therewith in replacement of, the
procedures and terms set forth above.
DENOMINATIONS
The authorized denominations for Multi-Currency Notes will be set forth in
the applicable Pricing Supplement.
CURRENCIES
Unless otherwise specified in the applicable Pricing Supplement,
purchasers of Multi Currency Notes are required to pay for such Multi-Currency
Notes in the Specified Currency in immediately available funds. If requested by
the purchaser of the Multi-Currency Note on or prior to the fifth Business Day
preceding the date of delivery of the Multi-Currency Notes (or by such other day
as the Presenting Agent shall determine), the Presenting Agent will arrange the
conversion of U.S. dollars into such Specified Currency to enable the purchaser
to pay for the Multi-Currency Notes. Each such conversion will be made by the
Presenting Agent on such terms and subject to such conditions, limitations and
charges as such Presenting Agent may from time to time establish in accordance
with its regular foreign exchange practices. All costs of exchange will be borne
by the purchasers of the Multi-Currency Notes.
PAYMENT OF PRINCIPAL AND INTEREST
The principal of, premium, if any, and interest on Multi-Currency Notes
will be payable in the Specified Currency. Unless otherwise indicated in the
applicable Pricing Supplement, the agent appointed by the Operating Partnership
(the "Exchange Rate Agent") will convert all such payments of principal,
premium, if any, and interest to U.S. dollars. However, unless otherwise
indicated in the applicable Pricing Supplement, the holder of a Multi-Currency
Note may elect to receive such payments in the Specified Currency as described
below.
Any U.S. dollar amount to be received by a holder of a Multi-Currency Note
will be based on the highest bid quotation in The City of New York received by
the Exchange Rate Agent at approximately 11:00 A.M., New York City time, on the
second Business Day preceding the applicable payment date from three recognized
foreign exchange dealers (one of which may be the Exchange Rate Agent) for the
purchase by the quoting dealer of the Specified Currency for U.S. dollars for
settlement on such payment date in the aggregate amount of the Specified
Currency payable to all holders of Notes scheduled to receive U.S. dollar
payments and at which the applicable dealer commits to execute a contract. If
such bid quotations are not available, payments will be made in the Specified
Currency. All currency
B-10
61
exchange costs will be borne by the holder of the Multi-Currency Note by
deductions from such payments.
A holder of a Multi-Currency Note may, unless otherwise specified in the
applicable Pricing Supplement, elect to receive payment of the principal of,
premium, if any, and interest on such Multi-Currency Notes in the Specified
Currency, by transmitting a written request for such payment by mail, hand
delivered, or by cable, telex or other form of facsimile transmission to the
principal office of the Trustee (acting as the Operating Partnership's paying
agent in The City of New York) on or prior to the Record Date or at least
sixteen days prior to Maturity, as the case may be, such election to remain in
effect until revoked by written notice to the Trustee received by the Trustee on
or prior to the Record Date or at least sixteen days prior to Maturity, as the
case may be. A holder of a Multi-Currency Note may elect to receive payment in
the Specified Currency for all principal, premium, if any, and interest payments
and need not file a separate election for each payment.
Interest on Multi-Currency Notes paid in U.S. dollars will be paid in the
manner specified in the applicable Pricing Supplement. Unless otherwise
specified in the applicable Pricing Supplement, interest on Multi-Currency Notes
paid in the Specified Currency will be paid by wire transfer to a bank account
maintained by the holder in the country of the Specified Currency. The principal
of Multi-Currency Notes, together with interest accrued and unpaid therein, due
at Maturity will be paid in immediately available funds against presentation of
such Multi-Currency Notes at the principal office of the Trustee, provided that
principal, premium, if any, and interest payable at Maturity in a Specified
Currency will be paid by wire transfer to such bank account. Any payment of
principal or interest required to be made on an Interest Payment Date or at
Maturity of a Multi-Currency Note which is not a Business Day need not be made
on such day, but may be made on the next succeeding Business Day with the same
force and effect as if made on the Interest Payment Date or Maturity, as the
case may be, and no interest shall accrue from the period from and after such
Interest Payment Date or Maturity.
PAYMENT OF PRINCIPAL AND INTEREST
If a Specified Currency is not available for payment of principal or
interest with respect to a Multi-Currency Note due to the imposition of exchange
controls or other circumstances beyond the reasonable control of the Operating
Partnership, the Operating Partnership will be entitled to satisfy its
obligations to holders of Multi-Currency Notes by making such payment in U.S.
dollars on the basis of the noon buying rate in The City of New York for cable
transfers of the Specified Currency as certified for customs purposes by the
Federal Reserve Bank of New York (the "Market Exchange Rate") on the second day
prior to such payment, or if such Market Exchange Rate is not then available, on
the basis of the most recently available Market Exchange Rate or as otherwise
indicated in the applicable Pricing Supplement. Any payment made under such
circumstances in U.S. dollars where required payment is in a Specified Currency
will not constitute a default under the Indenture.
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OUTSTANDING MULTI-CURRENCY NOTES
For purposes of calculating the principal amount of any Multi-Currency
Note for any purpose under the Indenture, the principal amount of such
Multi-Currency Note at any time Outstanding shall be deemed to be the U.S.
dollar equivalent at the Market Exchange Rate, determined as of the date of the
original issuance of such Multi-Currency Note, of the principal amount of such
Multi-Currency Note.
DETAILS FOR SETTLEMENT OF MULTI-CURRENCY NOTES
In addition to the Settlement information specified in "Settlement
Procedures" above, the Presenting Agent shall communicate to the Operating
Partnership in the manner set forth in "Settlement Procedures" the following
information:
1. Specified Currency
2. Denominations
3. Wire transfer and overseas bank account information (if holder has
elected payment in a Specified Currency).
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63
SPECIAL ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
Each Note will be represented by either a Global Security delivered to the
Trustee, as agent for the Depository Trust Operating Partnership ("DTC"), and
recorded in the book-entry system maintained by DTC or a certificate delivered
to the Holder thereof or a Person designated by such Holder. An owner of a
Book-Entry Note will not be entitled to receive a certificate representing such
Note. In connection with the qualification of the Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, the Trustee will perform
the custodial, document control and administrative functions described below, in
accordance with its respective obligations under a Letter of Representations
from the Operating Partnership and the Trustee to DTC and a Medium-Term Note
Certificate Agreement previously entered into between the Trustee and DTC, and
its obligations as a participant in DTC, including DTC's Same-Day Funds
Settlement System ("SDFS"'). Except as otherwise set forth in this Exhibit B,
Book-Entry Notes will be issued in accordance with the administrative procedures
set forth below.
ISSUANCE
On any date of settlement (as defined under "Settlement" below one or more
Fixed Rate Book-Entry Notes, the Operating Partnership will issue a single
Global Security in fully registered form without coupons representing up to
$200,000,000 principal amount of all of such Notes that have the same original
issuance date, interest rate and Stated Maturity. Similarly, on any settlement
date for one or more Floating Rate Book-Entry Notes, the Operating Partnership
will issue a single Global Security representing up to $200,000,000 principal
amount of all of such Notes that have the same interest rate formula, original
issuance date, Initial Interest Rate, Interest Payment Dates, Index Maturity,
Spread, Spread Multiplier, minimum interest rate (if any), maximum interest rate
(if any) and Stated Maturity. Each Global Security will be dated and issued as
of the date of its authentication by the Trustee, as Trustee. Each Global
Security will have an interest accrual date (the "Interest Accrual Date"), which
will be (i) with respect to an original Global Security (or any portion
thereof), its original issuance date and (ii) with respect to any Global
Security (or portion thereof) issued subsequently upon exchange of a Global
Security or in lieu of a destroyed, lost or stolen Global Security, the most
recent Interest Payment Date to which interest has been paid or duly provided
for on the predecessor Global Security or Securities (or if no such payment or
provision has been made, the original issuance date of the predecessor Global
Security), regardless of the date of authentication of such subsequently issued
Global Security. No Global Security will represent (i) both Fixed Rate and
Floating Rate Book-Entry Notes or (ii) any Certificated Note or (iii) any
Multi-Currency or Indexed Note.
IDENTIFICATION NUMBERS
The Operating Partnership will arrange, on or prior to commencement of a
program for the offering of Book-Entry Notes, with the CUSIP Service Bureau of
Standard & Poor's Corporation (the "CUSIP Service Bureau") for the reservation
of a series of CUSIP numbers (including tranche numbers), consisting of
approximately 900 CUSIP numbers and relating to Global Securities representing
the Book-Entry Notes. The Trustee has or will obtain from the CUSIP Service
Bureau a written list of such series of reserved CUSIP numbers and will deliver
to the Operating Partnership and DTC such written list of 900 CUSIP numbers of
such series.
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The Operating Partnership will assign CUSIP numbers to Global Securities as
described below under Settlement Procedure "B." DTC will notify the CUSIP
Service Bureau periodically of the CUSIP numbers that the Operating Partnership
has assigned to Global Securities. The Trustee will notify the Operating
Partnership at any time when fewer than 100 of the reserved CUSIP numbers remain
unassigned to Global Securities, and if it deems necessary, the Operating
Partnership will reserve additional CUSIP numbers for assignment to Global
Securities representing Book-Entry Notes. Upon obtaining such additional CUSIP
numbers the Trustee shall deliver such additional CUSIP numbers to the Operating
Partnership and DTC.
REGISTRATION
Each Global Security will be registered in the name of Cede & Co., as
nominee for DTC, on the Securities Register maintained under the Indenture
governing such Global Security. The beneficial owner of a Book-Entry Note (or
one or more indirect participants in DTC designated by such owner) will
designate one or more participants in DTC (with respect to such Note, the
"Participants") to act as agent or agents for such owner in connection with the
book-entry system maintained by DTC, and DTC will record in book-entry form, in
accordance with instructions provided by such Participants, a credit balance
with respect to such Note in the account of such Participants. The ownership
interest of such beneficial owner in such Note will be recorded through the
records of such Participants or through the separate records of such
Participants and one or more indirect participants in DTC.
TRANSFERS
Transfers of a Book-Entry Note will be accomplished by book entries made
by DTC and, in turn, by Participants (and in certain cases, one or more indirect
participants in DTC) acting on behalf of beneficial transferors and transferees
of such Note.
CONSOLIDATION AND EXCHANGE
The Trustee may deliver to DTC and the CUSIP Service Bureau at any time a
written notice of consolidation specifying (i) the CUSIP numbers of two or more
Outstanding Global Securities that represent (A) Fixed Rate Book-Entry Notes
having the same original issuance date, interest rate and Stated Maturity and
with respect to which interest has been paid to the same date or (B) Floating
Rate Book-Entry Notes having the same interest rate formula, original issuance
date, Initial Interest Rate, Interest Payment Dates, Index Maturity, Spread or
Spread Multiplier, minimum interest rate (if any), maximum interest rate (if
any) and with respect to which interest has been paid to the same date, (ii) a
date, occurring at least thirty days after such written notice is delivered and
at least thirty days before the next Interest Payment Date for such Book-Entry
Notes, on which such Global Securities shall be exchanged for a single
replacement Global Security and (iii) a new CUSIP number, obtained from the
Operating Partnership, to be assigned to such replacement Global Security. Upon
receipt of such a notice, DTC will send to its participants (including the
Trustee) a written reorganization notice to the effect that such exchange will
occur on such date. Prior to the specified exchange date the Trustee will
deliver to the CUSIP Service Bureau a written notice setting forth such exchange
date and the new CUSIP number and stating that, as of such exchange date, the
CUSIP numbers of the Global
B-14
65
Securities to be exchanged will no longer be valid. On the specified exchange
date, the Trustee will exchange such Global Securities for a single Global
Security bearing the new CUSIP number and a new Interest Accrual Date, and the
CUSIP numbers of the exchanged Global Securities will, in accordance with CUSIP
Service Bureau procedures, be cancelled and not immediately reassigned.
Notwithstanding the foregoing, if the Global Securities to be exchanged exceed
$200,000,000 in aggregate principal amount, one Global Security will be
authenticated and issued to represent each $200,000,000 of principal amount of
the exchanged Global Securities and an additional Global Security will be
authenticated and issued to represent any remaining principal amount of such
Global Securities (see "Denominations" below).
MATURITIES
Each Book-Entry Note will mature on a date not less than nine months after
the settlement date for such Note. A Floating Rate Book-Entry Note will mature
only on an Interest Payment Date for such Note.
DENOMINATIONS
Book-Entry Notes will be issued in principal amounts of $100,000 or any
amount in excess thereof that is an integral multiple of $1,000. Global
Securities representing one or more Book-Entry Notes will be denominated in
principal amounts not in excess of $1,000,000. If one or more Book-Entry Notes
having an aggregate principal amount in excess of $200,000,000 would, but for
the preceding sentence, be represented by a single Global Security, then one
Global Security will be issued to represent each $200,000,000 principal amount
of such Book-Entry Note or Notes and an additional Global Security will be
issued to represent any remaining principal amount of such Book-Entry Note or
Notes. In such a case, each of the Global Securities representing such
Book-Entry Note or Notes shall be assigned the same CUSIP number.
INTEREST
General. Interest on each Book-Entry Note will accrue from the Interest
Accrual Date of the Global Security representing such Note. Each payment of
interest on a Book-Entry Note will include interest accrued through the day
preceding, as the case may be, the Interest Payment Date or Maturity; provided,
however, that if the Interest Reset Dates with respect to any such Note are
daily or weekly, interest payable on any Interest Payment Date, other than
interest payable on any date on which principal for such Note is payable, will
include interest accrued from but excluding the second preceding Regular Record
Date to and including the next preceding Regular Record Date. Interest payable
at the Maturity of a Book-Entry Note will be payable to the Person to whom the
principal of such Note is payable. Standard & Poor's Corporation will use the
information received in the pending deposit message described under Settlement
Procedure "C" below in order to include the amount of any interest payable and
certain other information regarding the related Global Security in the
appropriate weekly bond report published by Standard & Poor's Corporation.
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On the first Business Day of January, April, July and October of each
year, the Trustee will deliver to the Operating Partnership and DTC a written
list of Regular Record Dates and Interest Payment Dates that will occur with
respect to Floating Rate Book-Entry Notes during the six-month period beginning
on such first Business Day. Promptly after each Interest Determination Date (as
defined in Appendix A hereto) for Floating Rate Notes, the Operating Partnership
will notify the Trustee, and the Trustee in turn will notify Standard & Poor's
Corporation, of the interest rates determined on such Interest Determination
Date.
PAYMENTS OF PRINCIPAL INTEREST
Payments of Interest Only. Promptly after each Regular Record Date, the
Trustee will deliver to the Operating Partnership and DTC a written notice
specifying by CUSIP number the amount of interest to be paid on each Global
Security on the following Interest Payment Date (other than an Interest Payment
Date coinciding with Maturity) and the total of such amounts. DTC will confirm
the amount payable on each Global Security on such Interest Payment Date by
reference to the daily bond reports published by Standard & Poor's Corporation.
The Operating Partnership will pay to the Trustee, as paying agent, the total
amount of interest due on such Interest Payment Date (other than at Maturity),
and the Trustee will pay such amount to DTC at the times and in the manner set
forth below under "Manner of Payment."
Payments at Maturity. On or about the first Business Day of each month,
the Trustee will deliver to the Operating Partnership, DTC and each of the
Trustees a written list of principal and interest to be paid on each Global
Security maturing in the following month. The Operating Partnership, the Trustee
and DTC will confirm the amounts of such principal and interest payments with
respect to each such Global Security on or about the fifth Business Day
preceding the Maturity of such Global Security. The Operating Partnership will
pay to the Trustee, as the paying agent, the principal amount of such Global
Security, together with interest due at such Maturity. The Trustee will pay such
amount to DTC at the times and in the manner set forth below under "Manner of
Payment."
Promptly after payment to DTC of the principal and interest due at the
Maturity of such Global Security, the Trustee will cancel such Global Security
and deliver it to the Operating Partnership with an appropriate debit advice. On
the first Business Date of each month, the Trustee will prepare a written
statement indicating the total principal amount of Outstanding Global Securities
for which it serves as trustee as of the immediately preceding Business Day.
Manner Of Payment. The total amount of any principal and interest due on
Global Securities on any Interest Payment Date or at Maturity shall be paid by
the Operating Partnership to the Trustee in funds available for use by the
Trustee as of 9:30 A.M. (New York City time) on such date. The Operating
Partnership will make such payment on such Global Securities by instructing the
Trustee to withdraw funds from an account maintained by the Operating
Partnership at the Trustee. The Operating Partnership will confirm such
instructions in writing to the Trustee, with a copy to the Trustee under the
Indenture governing such Global Securities if such Global Securities are of
subordinated or junior subordinated rank. For maturity, redemption or any other
principal payments: prior to 10 A.M. (New York City time) on such date or as
soon as possible thereafter, the Trustee will make such payments to DTC in same
day funds
B-16
67
in accordance with DTC's Same Day Funds Settlement Paying Agent Operating
Procedures. For interest payments: the Trustee will make such payments to DTC in
accordance with existing arrangements between DTC and the Trustee. DTC will
allocate such payments to its participants in accordance with its existing
operating procedures. Neither the Operating Partnership (either as issuer or as
Paying Agent) nor the Trustee shall have any direct responsibility or liability
for the payment by DTC to such Participants of the principal of and interest on
the Book-Entry Notes.
The amount of any taxes required under applicable law to be withheld from
any interest payment on a Book-Entry Note will be determined and withheld by the
Participant, indirect participant in DTC or other Person responsible for
forwarding payments and materials directly to the beneficial owner of such Note.
SETTLEMENT PROCEDURES
Settlement Procedures with regard to each Book-Entry Note sold by the
Operating Partnership through an Agent, as agent, shall be as follows:
A. The Presenting Agent will advise the Operating Partnership by
telephone, telex or facsimile, of the following settlement information:
1. Exact name in which Note is to be registered ("Registered Owner").
2. Exact address of the Registered Owner and address for payments of
principal and interest, if any.
3. Taxpayer identification number of the Registered Owner.
4. Principal amount of the Note (and, if multiple Notes are to be
issued, denominations thereof).
5. Settlement date.
6. Stated Maturity
7. Issue Price and any OID information.
8. Trade date.
9. The DTC Participant account number of such Agent.
10. Interest rate:
(a) Fixed Rate Notes:
i) interest rate
ii) overdue rate, if any
B-17
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(b) Floating Rate Notes:
i) interest rate basis
ii) initial interest rate
iii) spread or spread multiplier, if any
iv) interest rate reset periods
v) interest payment dates
vi) index maturity
vii) maximum and minimum interest rates, if any
viii) record dates
ix) interest determination dates
x) overdue rate, if any
11. The date on or after which the Notes are redeemable at the option of
the Operating Partnership, and additional redemption or repurchase
provisions, if any.
12. Wire transfer information.
13. Presenting Agent's commission (to be paid in the form of a discount
from the proceeds remitted to the Operating Partnership upon
settlement.
B. The Operating Partnership will assign a CUSIP number to the Global
Security representing such Note and then advise the Trustee by telephone
(confirmed in writing at any time on the same date) or electronic
transmission of the information set forth in Settlement Procedure "A"
above, such CUSIP number and the name of such Agent.
C. The Trustee will enter a pending deposit message through DTC's
Participant Terminal System, providing the following settlement
information to DTC, the Presenting Agent, Standard & Poor's Corporation
and, upon request, the Trustee under the Indenture pursuant to which such
Note is to be issued:
1. The information set forth in Settlement Procedure "A."
2. Identification as a Fixed Rate Book-Entry Note or a Floating Rate
Book-Entry Note.
3. Initial Interest Payment Date for such Note, number of days by which
such date succeeds the related "DTC Record Date" (which term means
the Regular Record Date except in the case of floating rate notes
which reset daily or weekly in which case it means the date 5
calendar days immediately preceding the Interest Payment Date) and
amount of interest payable on such Interest Payment Date.
4. Frequency of interest payments (monthly, semiannually, quarterly,
etc.).
5. CUSIP number of the Global Security representing such Note.
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6. Whether such Global Security will represent any other Book-Entry
Note (to the extent known at such time).
D. The Trustee, as Trustee, will complete and authenticate the note
certificate evidencing the Global Security representing such Book-Entry
Note.
E. DTC will credit such Note to the Trustee's participant account at DTC.
F. The Trustee will enter an SDFS deliver order through DTC's Participant
Terminal System instructing DTC to (i) debit such Note to the Trustee's
participant account and credit such Note to the Presenting Agent's
participant account and (ii) debit the Presenting Agent's settlement
account and credit the Trustee's settlement account for an amount equal to
the price of such Note less the Presenting Agent's commission.
G. The Presenting Agent will enter an SDFS deliver order through DTC's
Participant Terminal System instructing DTC (i) to debit such Note to the
Presenting Agent's participant account and credit such Note to the
participant accounts of the Participants with respect to such Note and
(ii) to debit the settlement accounts of such Participants and credit the
settlement account of the Presenting Agent for an amount equal to the
price of such Note.
H. Transfers of funds in accordance with SDFS deliver orders described in
Settlement Procedures "F" and "G" will be settled in accordance with SDFS
operating procedures in effect on the settlement date.
I. The Trustee will credit to an account of the Operating Partnership
maintained at the Trustee funds available for immediate use in the amount
transferred to the Trustee in accordance,with Settlement Procedure "F."
J. The Presenting Agent will deliver to the purchaser a copy of the most
recent Prospectus applicable to the Note with or prior to any written
offer of Notes and the confirmation and payment by the purchaser of the
Note.
The Presenting Agent will confirm the purchase of such Note to the
purchaser either by transmitting to the Participants with respect to such Note a
confirmation order or orders through DTC's institutional delivery system or by
mailing a written confirmation to such purchaser.
SETTLEMENT PROCEDURES TIMETABLE
For orders of Book-Entry Notes solicited by an Agent, as agent, and
accepted by the Operating Partnership for settlement, Settlement Procedures "A"
through "J" set forth above shall be completed as soon as possible but not later
than the respective times (New York City time) set forth below:
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=========================================================
SETTLEMENT
PROCEDURE TIME (NEW YORK)
=========================================================
A-B 11:00 A.M. on the Sale date
- ---------------------------------------------------------
C 2:00 PM on Sale date
- ---------------------------------------------------------
D 3:00 P.M. on date before Settlement
date
- ---------------------------------------------------------
E 10:00 A.M. on Settlement date
- ---------------------------------------------------------
F-G 2:00 P.M. on Settlement Date
- ---------------------------------------------------------
H 4:45 P.M. on Settlement date
- ---------------------------------------------------------
I-J 5:00 P.M. on Settlement date
=========================================================
If a sale is to be settled more than one Business Day after the sale date,
Settlement Procedures "A," "B" and "C" shall be completed as soon as practicable
but no later than 11:00 A.M. and 2:00 P.M., as the case may be, on the first
Business Day after the sale date. If the initial interest rate for a Floating
Rate Book-Entry Note has not been determined at the time that Settlement
Procedure "A" is completed, Settlement Procedures "B" and "C" shall be completed
as soon as such rate has been determined but no later than 11:00 A.M. and 12:00
Noon, respectively, on the second Business Day before the settlement date.
Settlement Procedure "I" is subject to extension in accordance with any
extension of Fedwire closing deadlines and in the other events specified in the
SDFS operating procedures in effect on the settlement date.
If settlement of a Book-Entry Note is rescheduled or canceled, the Trustee
will deliver to DTC, through DTC's Participant Terminal System, a cancellation
message to such effect by no later than 2:00 P.M. on the Business Day
immediately preceding the scheduled settlement date.
FAILURE TO SETTLE
If the Trustee fails to enter an SDFS deliver order with respect to a
Book-Entry Note pursuant to Settlement Procedure "F," the Trustee may deliver to
DTC, through DTC's Participant Terminal System, as soon as practicable a
withdrawal message instructing DTC to debit such Note to the Trustee's
participant account. DTC will process the withdrawal message, provided that the
Trustee's participant account contains a principal amount of the Global Security
representing such Note that is at least equal to the principal amount to be
debited. If a withdrawal message is processed with respect to all the Book-Entry
Notes represented by a
B-20
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Global Security, the Trustee will mark such Global Security "canceled," make
appropriate entries in the Trustee's records and send such canceled Global
Security to the Operating Partnership. The CUSIP number assigned to such Global
Security shall, in accordance with CUSIP Service Bureau procedures, be canceled
and not immediately reassigned. If a withdrawal message is processed with
respect to one or more, but not all, of the Book-Entry Notes represented by a
Global Security, the Trustee will exchange such Global Security for two Global
Securities, one of which shall represent such Book-Entry Note or Notes and shall
be canceled immediately after issuance and the other of which shall represent
the other Book-Entry Notes previously represented by the surrendered Global
Security and shall bear the CUSIP number of the surrendered Global Security.
If the purchase price for any Book-Entry Note is not timely paid to the
Participants with respect to such Note by the beneficial purchaser thereof (or a
Person, including an indirect participant in DTC, acting on behalf of such
purchaser), such Participants and, in turn, the Agent for such Note may enter
SDFS deliver orders through DTC's Participant Terminal System reversing the
orders entered pursuant to Settlement Procedures "F" and "G," respectively.
Thereafter, the Trustee will deliver the withdrawal message and take the related
actions described in the preceding paragraph.
Notwithstanding the foregoing, upon any failure to settle with respect to
a Book-Entry Note, DTC may take any actions in accordance with its SDFS
operating procedures then in effect. In the event of a failure to settle with
respect to one or more, but not all, of the Book-Entry Notes to have been
represented by a Global Security, the Trustee will provide, in accordance with
Settlement Procedure "D," for the authentication and issuance of a Global
Security representing the other Book-Entry Notes to have been represented by
such Global Security and will make appropriate entries in its records.
B-21
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EXHIBIT C
PURCHASE AGREEMENT
__________, 199_
Liberty Property Limited Partnership
65 Valley Stream Parkway
Malvern, PA 19355
Attention: George J. Alburger, Jr.
The undersigned agrees to purchase the following principal amount of the
Notes described in the Distribution Agreement dated October 24, 1997 (as it may
be supplemented or amended from time to time, the "Distribution Agreement"):
Principal Amount: $ ___________
Specified Currency: ___________
Denominated and Indexed Currencies: ___________
Interest Rate: ____%
Discount: ____% of Principal Amount
Aggregate Price to be paid to
Operating Partnership (in immediately
available funds): $ ___________
Settlement Date: ___________
Other Terms: ___________
[In the case of Notes issued in a foreign currency or currency unit,
unless otherwise specified below, settlement and payments of principal and
interest will be in U.S. dollars based on the highest bid quotation in The City
of New York received by the Exchange Rate Agent at approximately 11:00 A.M., New
York City time, on the second Business Day preceding the applicable payment date
from three recognized foreign exchange dealers (one of which may be the Exchange
Rate Agent) for the purchase by the quoting dealer of the Specified Currency for
U.S. dollars for settlement on such payment date in the aggregate
73
amount of the Specified Currency payable to all holders of Notes denominated in
such Specified Currency electing to receive U.S. dollar payments and at which
the applicable dealer commits to execute a contract. If such bid quotations are
not available, payments will be made in the Specified Currency.]
Our obligation to purchase Notes hereunder is subject to the continued
accuracy of your representations and warranties contained in the Distribution
Agreement and to your performance and observance of all applicable covenants and
agreements contained therein, including, without limitation, your obligations
pursuant to Section 7 thereof. Our obligation hereunder is subject to the
further condition that we shall receive (a) the opinions required to be
delivered pursuant to Sections 5(e) and 5(f) of the Distribution Agreement, (b)
the certificate required to be delivered pursuant to Section 5(h) of the
Distribution Agreement, (c) the letter referred to in Section 5(g) in each case
dated as of the above Settlement Date and (d) [insert other conditions as
appropriate].
In further consideration of our agreement hereunder, you agree that
between the date hereof and the above Settlement Date, you will not offer or
sell, or enter into any agreement to sell, any debt securities of the Operating
Partnership, other than borrowings under your revolving credit agreements and
lines of credit, the private placement of securities and issuances of your
commercial paper.
We may terminate this Agreement, immediately upon notice to you, at any
time prior to the Settlement Date, if prior thereto there shall have occurred:
(i) any change, or any development involving a prospective change, in or
affecting primarily the business, properties, condition (financial or other),
results of operations or prospects of the Operating Partnership or the Operating
Partnership and its subsidiaries taken as a whole which materially impairs the
investment quality of the Notes; (ii) a suspension or material limitation in
trading in securities generally on the New York Stock Exchange or the
establishment of minimum prices on such exchange; (iii) a general moratorium on
commercial banking activities declared by Federal or state authorities; (iv) any
downgrading in the rating accorded the Operating Partnership's debt securities
by any "nationally recognized statistical rating organization," as that term is
defined by the Commission for purposes of Rule 436(g)(2) under the Act or any
public announcement that any such organization has under surveillance or review
its rating of any debt securities of the Operating Partnership (other than an
announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); (v) any outbreak or
escalation of major hostilities in which the United States is involved, any
declaration of war by Congress or any other substantial national calamity or
emergency; or (vi) any material adverse change in the existing financial,
political or economic conditions in the United States, or you are unable to
provide any of the opinions, certificates or letters referred to in the second
preceding paragraph. In the event of such termination, no party shall have any
liability to the other party hereto, except as provided in Sections 4, 7 and 15
of the Distribution Agreement.
This Agreement shall be governed by and construed in accordance with the
laws of New York.
C-2
74
Lehman Brothers Inc.
By: ________________________________________________
Authorized Signatory
Donaldson, Lufkin & Jenrette Securities Corporation
By: ________________________________________________
Name:
Title:
First Chicago Capital Markets, Inc.
By: ________________________________________________
Name:
Title:
J.P. Morgan Securities Inc.
By: ________________________________________________
Name:
Title:
UBS Securities LLC
By: ________________________________________________
Name:
Title:
C-3
75
Confirmed and Accepted:
LIBERTY PROPERTY LIMITED PARTNERSHIP
By: Liberty Property Trust
By: ______________________________________
Name:
Title:
C-4
76
EXHIBIT D
[FOREIGN CURRENCY] [INDEXED NOTE]
AMENDMENT NO. ___
TO DISTRIBUTION AGREEMENT DATED OCTOBER 24, 1997, AS AMENDED
[Insert Title of Foreign Currency or, in the case of
Indexed Notes, the Denominated and Indexed
Currencies]
The undersigned hereby agree that for the purposes of the issue and sale
of Notes denominated in title of currency or currency unit (the "Applicable
Foreign Currency") [and indexed to title of currency or currency unit (the
"Indexed Currency")] pursuant to the Distribution Agreement, dated October 24,
1997, as it may be amended (the "Distribution Agreement"), the following
additions and modifications shall be made to the Distribution Agreement. The
additions and modifications adopted hereby shall be of the same effect for the
sale under the Distribution Agreement of all Notes denominated in the Applicable
Foreign Currency and indexed to the Indexed Currency, whether offered on an
agency or principal basis, but shall be of no effect with respect to Notes
denominated in any currency or currency unit other than the Applicable Foreign
Currency.
Except as otherwise expressly provided herein, all terms used herein which
are defined in the Distribution Agreement shall have the same meanings as in the
Distribution Agreement. The terms Agent or Agents, as used in the Distribution
Agreement, shall be deemed to refer only to the undersigned Agents for purposes
of this Amendment.
[Insert appropriate additions and modifications to the Distribution
Agreement, for example, to opinions of counsel, conditions to obligations and
settlement procedures, etc.]
_____________, 199__
LIBERTY PROPERTY LIMITED PARTNERSHIP
By: _____________________
Name:
Title:
77
Confirmed and Accepted: _____________, 199__
[NAME(S) OF AGENT(S) PARTICIPATING
IN THE OFFERING OF NOTES IN THE APPLICABLE FOREIGN CURRENCY]
By: _____________________
Name:
Title:
D-2