EXHIBIT 1.1
PUBLIC STORAGE, INC.
20,000,000 Depositary Shares
Each Representing 1/1,000 of a Share of
8.000% Cumulative Preferred Stock, Series R
Liquidation Preference Equivalent to $25.00 Per Depositary Share
UNDERWRITING AGREEMENT
September 4, 2001
SALOMON SMITH BARNEY INC.
A.G. EDWARDS & SONS, INC.
FIRST UNION SECURITIES, INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
MORGAN STANLEY & CO. INCORPORATED
UBS WARBURG LLC
CIBC WORLD MARKETS CORP.
CREDIT SUISSE FIRST BOSTON CORPORATION
DEUTSCHE BANC ALEX. BROWN INC.
PRUDENTIAL SECURITIES INCORPORATED
RAYMOND JAMES & ASSOCIATES, INC.
As Representatives of the Several Underwriters
c/o SALOMON SMITH BARNEY INC.
388 Greenwich Street
New York, New York 10013
Ladies and Gentlemen:
Public Storage, Inc., a real estate investment trust ("REIT") and a
California corporation (the "Company"), proposes to issue and sell an aggregate
of 20,000,000 shares (the "Firm Shares") of its Depositary Shares (the
"Depositary Shares"), each representing 1/1,000 of a share of 8.000% Cumulative
Preferred
Stock, Series R, stated value $25,000 per share (the "Preferred Stock"), to you
and the other underwriters named in Schedule I hereto (collectively, the
"Underwriters") for whom you are acting as Representatives (the
"Representatives"). The Company also proposes to sell to the Underwriters, upon
the terms and conditions set forth in Section 1 hereof, up to an additional
400,000 Depositary Shares (the "Additional Shares"). The Firm Shares and the
Additional Shares are hereinafter collectively referred to as the "Shares."
The shares of Preferred Stock represented by the Shares (the
"Preferred Shares") will, when issued, be deposited by the Company against
delivery of Depositary Receipts ("Depositary Receipts") to be issued by Fleet
National Bank, as Depositary (the "Depositary"), under a Deposit Agreement (the
"Deposit Agreement") among the Company, the Depositary, and the holders from
time to time of the Depositary Receipts issued thereunder. Each Depositary
Receipt will represent one or more Depositary Shares.
The Company wishes to confirm as follows its agreement with you and
the other several Underwriters on whose behalf you are acting, in connection
with the several purchases of the Shares by the Underwriters.
1. Agreements to Sell and Purchase.
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(a) On the basis of the representations, warranties and agreements of
the Company herein contained and subject to all the terms and conditions of this
Agreement, the Company agrees to sell to the Underwriters and each Underwriter
agrees, severally and not jointly, to purchase from the Company, at a purchase
price of $24.2125 per share (the "purchase price per share"), the number of Firm
Shares set forth opposite the name of such Underwriter in Schedule I hereto (or
such number of Firm Shares increased as set forth in Section 9 hereof).
(b) The Company also agrees, subject to all the terms and conditions
set forth herein, to sell to the Underwriters, and, upon the basis of the
representations, warranties and agreements of the Company herein contained and
subject to all the terms and conditions set forth herein, the Underwriters shall
have the right to purchase from the Company, at the purchase price per share,
pursuant to an option (the "over-allotment option") which may be exercised at
any time and from time to time prior to 9:00 P.M., New York City time, on the
30th day after the date of the Prospectus (as defined in Section 4) (or, if such
30th day shall be a Saturday or Sunday or a holiday, on the next business day
thereafter when the New
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York Stock Exchange is open for trading), up to an aggregate of 400,000
Additional Shares. Additional Shares may be purchased only for the purpose of
covering over-allotments made in connection with the offering of the Firm
Shares. Upon any exercise of the over-allotment option, each Underwriter,
severally and not jointly, agrees to purchase from the Company the number of
Additional Shares (subject to such adjustments as you may determine in order to
avoid fractional shares) which bears the same proportion to the number of
Additional Shares to be purchased by the Underwriters as the number of Firm
Shares set forth opposite the name of such Underwriter in Schedule I hereto (or
such number of Firm Shares increased as set forth in Section 9 hereof) bears to
the aggregate number of Firm Shares.
2. Terms of Public Offering.
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The Company has been advised by you that the Underwriters propose to
make a public offering of their respective portions of the Shares as soon after
this Agreement has been entered into and the Registration Statement (as defined
herein), and, if necessary, any post-effective amendment to the Registration
Statement, has become effective as in your judgment is advisable and initially
to offer the Shares upon the terms set forth in the Prospectus (as defined
herein).
3. Delivery of the Shares and Payment Therefor.
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Delivery to the Underwriters of and payment for the Firm Shares shall
be made at the office of Salomon Smith Barney Inc., 388 Greenwich Street, New
York, NY 10013, at 10:00 A.M., New York City time, on September 28, 2001 (the
"Closing Date"). The place of closing for the Firm Shares and the Closing Date
may be varied by agreement between you and the Company.
Delivery to the Underwriters of and payment for any Additional Shares
to be purchased by the Underwriters shall be made at the aforementioned office
of Salomon Smith Barney Inc. at such time on such date (the "Option Closing
Date"), which may be the same as the Closing Date but shall in no event be
earlier than the Closing Date nor earlier than three nor later than ten business
days after the giving of the notice hereinafter referred to, as shall be
specified in a written notice from you on behalf of the Underwriters to the
Company of the Underwriters' determination to purchase a number, specified in
such notice, of Additional Shares. The place of closing for any Additional
Shares and the Option
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Closing Date for such Shares may be varied by agreement between you and the
Company.
Certificates for the Firm Shares and for any Additional Shares to be
purchased hereunder shall be registered in such names and in such denominations
as you shall request prior to 1:00 P.M., New York City time, on the second
business day preceding the Closing Date or any Option Closing Date, as the case
may be. Such certificates shall be made available to you in New York City for
inspection and packaging not later than 9:30 A.M., New York City time, on the
business day next preceding the Closing Date or the Option Closing Date, as the
case may be. The certificates evidencing the Firm Shares and any Additional
Shares to be purchased hereunder shall be delivered to you on the Closing Date
or the Option Closing Date, as the case may be, against payment of the purchase
price therefor by wire transfer of immediately available funds to the order of
the Company.
4. Representations and Warranties of the Company. The Company
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represents, warrants and covenants to the Underwriters as set forth below.
Certain terms used in this Section 4 are defined in paragraph (ae) hereof.
(a) The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement, registration number 333-81041 (the
"Registration Statement"), on Form S-3, including the related prospectus
included in the Registration Statement, for the registration under the
Securities Act of 1933, as amended (the "Act"), of the offering and sale of,
inter alia, the Shares. The Company may have filed one or more amendments
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thereto, including each related prospectus, and one or more prospectus
supplements thereto, each of which has previously been furnished to the
Representatives. Any registration statement filed pursuant to Rule 462(b) under
the Act is herein referred to as the "Rule 462(b) Registration Statement," and,
after such filing, the term "Registration Statement" shall include the Rule
462(b) Registration Statement. The Company has filed with, or transmitted for
filing to, or shall promptly hereafter file with or transmit for filing to, the
Commission a prospectus supplement (the "Prospectus Supplement") specifically
relating to the Shares pursuant to Rule 424 under the Act. The Company has
included or will include in such Registration Statement, as amended at the
Execution Time, and in the Prospectus Supplement all information required by the
Act and the rules thereunder to be included therein with respect to the Shares
and the offering thereof. As filed, such Registration Statement, as so amended,
and form of final prospectus contained in the Registration Statement and
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Prospectus Supplement, or such final prospectus and Prospectus Supplement,
contains or will contain all required information with respect to the Shares and
the offering thereof and, except to the extent the Representatives shall agree
in writing to a modification, shall be in all substantive respects in the form
furnished to the Underwriters prior to the date hereof or, to the extent not
completed at the Execution Time, shall contain only such specific additional
information and other changes as the Company has advised the Representatives,
prior to the Execution Time, will be included or made therein.
(b) On the Effective Date, the Registration Statement did or will,
and when the Prospectus and the Prospectus Supplement is first filed in
accordance with Rule 424(b) and on the Closing Date, the Prospectus (and any
supplements thereto) will, comply in all material respects with the requirements
of the Act and the rules thereunder; on the Effective Date, the Registration
Statement did not or will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading; and, on the date of any
filing pursuant to Rule 424(b) and on the Closing Date, the Prospectus (together
with any supplement thereto) will not include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the Company makes no representations or
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warranties as to the information contained in or omitted from the Registration
Statement or the Prospectus (or any supplement thereto) in reliance upon and in
conformity with information furnished in writing to the Company by or on behalf
of any Underwriter through the Representatives specifically for inclusion in the
Registration Statement or the Prospectus (or any supplement thereto).
(c) The Registration Statement has become effective under the Act,
and no stop order suspending the effectiveness of the Registration Statement is
in effect and no proceedings for such purpose are, to the knowledge of the
Company, pending before or threatened by the Commission.
(d) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement and the Prospectus, at the time they
were or hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), and the rules and regulations of the Commission
thereunder and, when read together with the other information in the Prospectus,
at the date of
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the Prospectus and at the Closing Time, did not and will not include an untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances, under which they were
made, not misleading.
(e) The only subsidiaries of the Company are the Subsidiaries (as
defined below). Each of the Company, SEI Arlington Acquisition Corporation ("SEI
Arlington"), SEI Hypoluxo Acquisition Corporation ("Hypoluxo"), PSTI/SEI -North
Bergen Acquisition Corporation ("PSTI"), SEI-Sandy Acquisition Corporation
("Sandy"), PS Orangeco, Inc. ("Orangeco"), Public Storage Pickup & Delivery,
Inc. ("PSPUD"), PSI Institutional Advisors, Inc. ("PSIIA"), PSAF Development,
Inc. ("PSAF Inc.") PS GPT Properties, Inc. ("PS GPT"), PS LPT Properties
Investors ("PS LPT"), Belmont Acquisition Co. ("Belmont") and SEI -Firestone
Acquisition Corporation ("SEI Firestone" and, together with SEI Arlington,
Hypoluxo, PSTI, Sandy, Orangeco, PSPUD, PSIIA, PS GPT, PS LPT, Belmont and PSAF
Inc., the "Subsidiaries"), and PS Partners, Ltd. ("PSPI"), PS Partners II, Ltd.
("PSPII"), PS Partners III, Ltd. ("PSPIII"), PS Partners IV, Ltd. ("PSPIV"), PS
Partners V, Ltd. ("PSPV"), PS Partners VI, Ltd. ("PSPVI"), PS Partners VIII,
Ltd. ("PSPVIII"), PS Texas Holdings, Ltd. ("Texas Holdings"), PSAF Development
Partners, L.P. ("PSAF LP"), PSAC Development Partners, L.P. ("PSAC LP") and PSA
Institutional Partners, L.P. ("PSAIP LP" and, together with PSPI, PSPII, PSPIII,
PSPIV, PSPV, PSPVI, PSPVIII, Texas Holdings, PSAF LP and PSAC LP, the
"Partnerships") has been duly organized and is validly existing (in the case of
the Company and each of the Subsidiaries, as a corporation) in good standing
under the laws of the jurisdiction in which it is organized, with full power and
authority to own or lease and occupy its properties and conduct its business as
described in the Prospectus, and is duly qualified to do business, and is in
good standing, in each jurisdiction which requires such qualifi cation, except
where the failure to so qualify would not, individually or in the aggregate,
have a material adverse effect on the business, operations, earnings, assets or
financial condition of the Company (a "Material Adverse Effect"). All of the
outstanding shares of capital stock of each of the Subsidiaries have been duly
authorized and validly issued, are fully paid and nonassessable, and are owned
by the Company (in the case of Orangeco, approximately 95% owned), directly, or
indirectly through another Subsidiary, free and clear of any lien, adverse
claim, security interest, equity, or other encumbrance. The Company owns as of
the date hereof approximately 100%, 100%, 100%, 56%, 61%, 61% and 100% of the
limited partnership units of PSPI, PSPII, PSPIII, PSPIV, PSPV, PSPVI and
PSPVIII, respectively. The Company owns as of the date hereof an approximately
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30% economic interest in PSAF LP, a 51% economic interest in PSAC LP, a 100%
economic interest in Texas Holdings, and 100% of the common units, 100% of the
parity preferred units and none of the exchangeable preferred units (Series N,
Series O and Series P) in PSAIP LP.
(f) The Company, each of the Subsidiaries and each Partnership have
all requisite power and authority, and all necessary material authorizations,
approvals, orders, licenses, certificates and permits of and from all regulatory
or governmental officials, bodies and tribunals, to own or lease their
respective properties and to conduct their respective businesses as now being
conducted and as described in the Prospectus; all such authorizations,
approvals, licenses, certificates and permits are in full force and effect,
except where the failure to be in full force and effect would not have a
Material Adverse Effect on the Company, such Subsidiary or such Partnership; and
the Company, each of the Subsidiaries and each Partnership are complying with
all applicable laws, the violation of which could have a Material Adverse Effect
on the Company, such Subsidiary or such Partnership, as the case may be.
(g) The Company, each Subsidiary and each Partnership have good and
marketable title to their properties, free and clear of all material liens,
charges and encumbrances and equities of record, except as set forth or
reflected in the Prospectus.
(h) The Company, each Subsidiary and each Partnership maintains
adequate insurance for the conduct of their respective business as described in
the Prospectus.
(i) The Company, either directly or through the Subsidiaries or
Partnerships, owns or licenses or otherwise has the right to use all patents,
trade marks, trade names and trade secrets material to the Company's business as
described in the Prospectus; other than routine proceedings which if adversely
determined would not materially affect the business (as described in the
Prospectus) of the Company, the Subsidiaries and the Partnerships taken as a
whole, no claims have been asserted by any person with respect to the use of any
such patents, trademarks, trade names or trade secrets or challenging or
questioning the validity or effectiveness of any such patents, trademarks, trade
names or trade secrets; to the best knowledge of the Company, the use, in
connection with the business and operations of the Company, the Subsidiaries and
the Partnerships, of
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such patents, trademarks and trade names does not infringe on the rights of any
person.
(j) The Company's authorized capitalization is as set forth in the
Prospectus (including the Incorporated Documents); the capital stock of the
Company conforms in all material respects to the description thereof contained
in the Prospectus; the outstanding shares of common stock, par value $.10 per
share, of the Company (the "Common Stock"), Class B common stock, par value $.10
per share, of the Company (the "Class B Common Stock"), Series A Preferred
Stock, par value $.01 per share, of the Company (the "Series A Preferred
Stock"), Series B Preferred Stock, par value $.01 per share, of the Company (the
"Series B Preferred Stock"), Adjustable Rate Cumulative Preferred Stock, Series
C, stated value $25.00 per share, of the Company (the "Series C Preferred
Stock"), 9.50% Cumulative Preferred Stock, Series D, stated value $25.00 per
share, of the Company (the "Series D Preferred Stock"), 10% Cumulative Preferred
Stock, Series E, stated value $25.00 per share, of the Company (the "Series E
Preferred Stock"), 9.75% Cumulative Preferred Stock, Series F, stated value of
$25.00 per share, of the Company (the "Series F Preferred Stock"), 8-7/8%
Cumulative Preferred Stock, Series G, stated value of $25,000 per share, of the
Company (the "Series G Preferred Stock"), 8.45% Cumulative Preferred Stock,
Series H, stated value of $25,000 per share, of the Company (the "Series H
Preferred Stock"), 8-5/8% Cumulative Preferred Stock, Series I, stated value of
$25,000 per share, of the Company (the "Series I Preferred Stock"), 8%
Cumulative Preferred Stock, Series J, stated value of $25,000 per share, of the
Company (the "Series J Preferred Stock"), 8 1/4% Cumulative Preferred Stock,
Series K, stated value of $25,000 per share, of the Company (the "Series K
Preferred Stock"), 8 1/4% Cumulative Preferred Stock, Series L, stated value of
$25,000 per share, of the Company (the "Series L Preferred Stock"), 8.75%
Cumulative Preferred Stock, Series M, stated value of $25,000 per share, of the
Company (the "Series M Preferred Stock"), 9.5% Cumulative Preferred Stock,
Series N, stated value of $25,000 per share, of the Company (the "Series N
Preferred Stock"), 9.125% Cumulative Preferred Stock, Series O, stated value of
$25,000 per share, of the Company (the "Series O Preferred Stock"), 8.75%
Cumulative Preferred Stock, Series P, stated value of $25,000 per share, of the
Company (the "Series P Preferred Stock"), 8.600% Cumulative Preferred Stock,
Series Q, stated value of $25,000 per share, of the Company (the "Series Q
Preferred Stock"), Equity Stock, Series A, of the Company ("Series A Equity
Stock"), Equity Stock, Series AA, of the Company ("Series AA Equity Stock"), and
Equity Stock, Series AAA, of the Company ("Series AAA Equity Stock") have each
been duly and validly
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authorized and issued in compliance with all Federal and state securities laws,
and are fully paid and nonassessable; the Shares and the Preferred Shares have
been duly and validly authorized and, when issued and delivered pursuant to this
Agreement and, in the case of the Shares, the Deposit Agreement, will be fully
paid and nonassessable; application has been made to list the Shares on the New
York Stock Exchange; the form of certificate for the Shares will be in valid and
sufficient form in compliance with New York Stock Exchange requirements; and the
holders of outstanding shares of capital stock of the Company are not entitled
to preemptive or other rights to subscribe for the Shares or the Preferred
Stock.
(k) There is no pending or, to the best knowledge of the Company,
after due inquiry, threatened, action, suit, proceeding or investigation before
any court, governmental agency, authority or body or arbitrator involving the
Company, any of the Subsidiaries or any of the Partnerships or any of their
respective officers or any of their respective properties, assets or rights of a
character re quired to be disclosed in the Registration Statement or Prospectus
which is not adequately disclosed in the Prospectus, and there is no franchise,
contract or other document of a character required to be described in the
Registration Statement or Prospectus, or to be filed as an exhibit, which is not
described or filed as required.
(l) The Company has full corporate power and authority to enter into
and perform its obligations under this Agreement and the Deposit Agreement and
to issue, sell and deliver the Shares and to issue and deliver the Preferred
Shares; and this Agreement and the Deposit Agreement have been duly authorized;
and this Agreement has been, and the Deposit Agreement as of the Closing Date,
will have been, duly executed and delivered by the Company. When so executed,
the Deposit Agreement will constitute a valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms, except to
the extent that enforcement thereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereinafter
in effect relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether a proceeding is considered at law or in equity).
(m) No consent, approval, authorization or order of any court or
governmental agency, authority or body is required (and has not been received)
for the execution by the Company of this Agreement or the Deposit Agreement, the
performance by the Company of its obligations hereunder or thereunder or the
consummation by the Company of the transactions contemplated herein or therein,
except such as are required under the state securities or the Blue Sky laws of
any
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jurisdiction in connection with the purchase and distribution of the Shares by
the Underwriters. Neither the Company nor any of its affiliates is presently
doing any business with the government of Cuba or with any person or affiliate
located in Cuba.
(n) Neither the Company nor any of the Subsidiaries is in violation
of, in conflict with, in breach of or in default under (and none of them know of
an event which with the giving of notice or the lapse of time or both would be
reasonably likely to constitute a default under) its charter or by-laws, and
none of the Partnerships is in violation of its respective partnership agreement
(and none of them know of an event which with the giving of notice or the lapse
of time or both would be reasonably likely to constitute a violation), and
neither the Company, any Subsidiary nor any Partnership is in default in the
performance of any obligation, agreement or condition contained in any loan,
note or other evidence of indebted ness or in any indenture, mortgage, deed of
trust or any other material agreement by which it or its properties are bound,
except for such defaults as could not, individually or in the aggregate, have a
Material Adverse Effect on the Company, such Subsidiary or such Partnership, as
the case may be.
(o) Neither the Company, any of the Subsidiaries nor any of the
Partnerships has violated any environmental, safety or similar law or regulation
applicable to its business relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants, nor has the Company, any of the Subsidiaries nor any of the
Partnerships violated any Federal, state or local law relating to discrimination
in the hiring, promotion, pay or terms or conditions of employment of employees
nor any applicable wage or hour laws, nor has the Company or any of the
Partnerships engaged in any unfair labor practice, which in each case could
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect on the Company, such Subsidiary or such Partnership, as the case
may be.
(p) Neither the issue and sale of the Shares nor the consummation of
any of the other transactions herein contemplated (including without limitation
the execution, delivery and performance of the Deposit Agreement, the issuance
and deposit of the Preferred Shares in accordance with the Deposit Agreement and
the consummation of the transactions contemplated therein) nor the fulfillment
of the terms hereof or thereof will conflict with, result in a breach or
violation of, or constitute a default under any law or the charter or by-laws of
the Company or any of the Subsidiaries or the partnership agreement of any of
the Partnerships or the
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terms of any indenture or other agreement or instrument to which the Company,
any of the Subsidiaries or any of the Partnerships is a party or is bound or any
judgment, order or decree applicable to the Company, any of the Subsidiaries or
any of the Partnerships of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the Company, any of the
Subsidiaries or any of the Partnerships.
(q) The Company has fulfilled its obligations, if any, under the
minimum funding standards of Section 302 of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), and the regulations and published
interpretations thereunder with respect to each "pension plan" (as defined in
ERISA and such regulations and published interpretations) in which employees of
the Company are eligible to participate and each such plan is in compliance in
all material respects with the presently applicable provisions of ERISA and such
regulations and published interpretations (except for such failure to so comply
that would not have, singularly or in the aggregate with all other such failures
to comply, a Material Adverse Effect), and has not incurred any unpaid liability
to the Pension Benefit Guaranty Corporation (other than for the payment of
premiums in the ordinary course) or to any such plan under Title IV of ERISA.
(r) Other than as described in the Prospectus (including the
Incorporated Documents) and other than the grant or assumption of options to
purchase 1,764,500 shares of Common Stock since January 1, 2001, there are no
outstanding warrants or options to purchase any shares of capital stock of the
Company and there are no restrictions upon the voting or transfer of, or the
declaration or payment of any dividend or distribution on, any shares of capital
stock of the Company pursuant to the articles of incorporation or by-laws of the
Company, any agreement or other instrument to which the Company is a party or by
which the Company is bound, or any order, law, rule, regulation or determination
of any court, governmental agency or body (including, without limitation, any
banking or insurance regulatory agency or body), or arbitrator having
jurisdiction over the Company. No holders of securities of the Company have
rights to the registration of such securities under the Registration Statement.
(s) The Company is qualified, has been qualified since January 1,
1981, has been operating, since the beginning of the current fiscal year, in a
manner that would continue to permit it to be qualified, and intends to operate
so as to continue to be qualified, (i) as a REIT under Section 856 et seq. of
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the
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Internal Revenue Code of 1986, as amended (the "Code"), and (ii) to be taxed on
its "real estate investment trust income" pursuant to Section 857 of the Code.
(t) No statement, representation, warranty or covenant made by the
Company in this Agreement or made in any certificate or document required by
this Agreement to be delivered to the Representatives is, or will be, when made,
inaccurate, untrue or incorrect in any material respect.
(u) Neither the Company nor any of its officers, directors, or
controlling persons has taken, directly or indirectly, any action intended, or
which might reasonably be expected, to cause or result, under the Act or
otherwise, in, or which has constituted, stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
Shares in violation of the Act.
(v) To the best of the Company's knowledge, the firm of accountants
that have certified or shall certify the applicable financial statements and
supporting schedules filed or to be filed with the Commission as part of (or
incorporated by reference in) the Registration Statement and the Prospectus are
independent public accountants with respect to the Company and any other
applicable entity, as required by the Act. The financial statements, together
with related schedules and notes, incorporated by reference in the Prospectus
and the Registration Statement comply as to form in all material respects with
the requirements of the Act. Such financial statements fairly present the
consolidated financial position of the Company, the Subsidiaries and the
Partnerships at the respective dates indicated and the results of their
operations and their cash flows for the respective periods indicated, and have
been prepared in accordance with generally accepted accounting principles,
except as otherwise expressly stated therein, as consistently applied throughout
such periods. The pro forma financial statements and the related notes thereto,
and the other pro forma financial information, included or incorporated by
reference in the Prospectus and the Registration Statement present fairly the
information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial statements
and have been properly compiled on the bases described therein, in all material
respects, and the assumptions used in the preparation thereof are reasonable and
the adjustments used therein are appropriate to give effect to the transactions
and circumstances referred to therein. The other financial and statistical
information and data included in the Prospectus and in the Registration
Statement are, in all material respects, accurately presented and prepared on a
basis consistent with applicable financial statements and the books and records
of
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the Company, the Subsidiaries and the Partnerships or, with respect to
information and data relating to persons other than the Company, the
Subsidiaries and the Partnerships, other information available to the Company.
(w) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), neither
the Company, any of the Subsidiaries nor any of the Partnerships has incurred
any liability or obligation, direct or contingent, or entered into any
transaction, not in the ordinary course of business, that is material to the
Company, the Subsidiaries and the Partnerships taken as a whole, and there has
not been any material change in the capital stock, or material increase in the
short-term debt or long-term debt, of the Company, any Subsidiary or any of the
Partnerships, or any material adverse change, or any development (that relates
to the Company, the Subsidiaries and the Partnerships or to any of its
respective properties or assets) which may reasonably be expected to involve a
prospective material adverse change, in the condition (financial or other),
business, net worth or results of operations of the Company, the Subsidiaries
and the Partnerships taken as a whole.
(x) The Company has not distributed and, prior to the later to occur
of (i) the Closing Date and (ii) completion of the distribution of the Shares,
will not distribute any offering material in connection with the offering and
sale of the Shares other than the Registration Statement, the Prospectus or
other materials, if any, permitted by the Act.
(y) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that in all material respects (i)
transac tions are executed in accordance with management's general or specific
authoriza tion; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (iii) access to
assets is permitted only in accor dance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(z) To the Company's knowledge, neither the Company, any of its
Subsidiaries nor any of the Partnerships nor any employee or agent of the
Company, any Subsidiary or any Partnership has made any payment of funds of the
13
Company, any Partnership or any Subsidiary or received or retained any funds in
violation of any law, rule or regulation, which payment, receipt or retention of
funds is of a character required to be disclosed in the Prospectus.
(aa) The Company, each of the Subsidiaries and each of the
Partnerships have filed all tax returns required to be filed (except to the
extent extensions have been timely filed related thereto), which returns are
complete and correct in all material respects, and neither the Company, any
Partnership nor any Subsidiary is in default in the payment of any taxes which
were payable pursuant to said returns or any assessments with respect thereto.
(ab) Assuming due authorization, execution and delivery of the
Deposit Agreement by the Depositary, each Share will represent an interest in
1/1,000 of a share of a validly issued, outstanding, fully paid and
nonassessable share of Preferred Stock; assuming due execution and delivery of
the Depositary Receipts by the Depositary pursuant to the Deposit Agreement, the
Depositary Receipts will entitle the holders thereof to the benefits provided
therein and in the Deposit Agreement.
(ac) To the best of the Company's knowledge, no labor disturbance by
the employees of the Company, the Subsidiaries or the Partnerships exists or is
imminent that would, individually or in the aggregate, have a Material Adverse
Effect. No collective bargaining agreement exists with any of the Company's
employees and, to the best of the Company's knowledge, no such agreement is
imminent.
(ad) The Company has been advised concerning the Investment Company
Act of 1940, as amended (the "1940 Act"), and the rules and regulations
thereunder, and has in the past conducted, and intends in the future to conduct,
its affairs in such a manner as to ensure that it will not become an "investment
company" or a company "controlled" by an "investment company" within the meaning
of the 1940 Act and such rules and regulations.
(ae) The terms which follow, when used in this Agreement, shall have
the meanings indicated. The term "the Effective Date" shall mean each date that
the Registration Statement and any post-effective amendment or amendments
thereto became or become effective. "Execution Time" shall mean the date and
time that this Agreement is executed and delivered by the parties hereto.
"Preliminary Prospectus" shall mean any preliminary prospectus or preliminary
prospectus
14
supplement relating to the Shares and the Preferred Shares, in each case filed
pursuant to Rule 424(b). "Prospectus" shall mean the prospectus and any
Prospectus Supplement relating to the Shares that is first filed pursuant to
Rule 424(b) after the Execution Time. "Registration Statement" shall mean the
Registration Statement referred to in paragraph (a) above, including exhibits
and financial statements, as amended at the Execution Time and, in the event any
post-effective amendment thereto becomes effective prior to the Closing Date,
shall also mean such registration statement as so amended. "Rule 424" refers to
such rule under the Act. Any reference herein to the Registration Statement, a
Preliminary Prospectus or the Prospectus shall be deemed to refer to and include
the documents incorporated by reference therein either pursuant to the terms of
the Registration Statement or pursuant to Item 12 of Form S-3 which were filed
under the Exchange Act on or before the Effective Date of the Registration
Statement or the issue date of such Preliminary Prospectus or the Prospectus, as
the case may be (collectively, the "Incorporated Documents"); and any reference
herein to the terms "amend," "amendment" or "supplement" with respect to the
Registration Statement, any Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include the filing of any document under the Exchange Act
after the Effective Date of the Registration Statement, or the issue date of any
Preliminary Prospectus or the Prospectus, as the case may be, deemed to be
incorporated therein by reference.
5. Agreements of the Company. The Company agrees with the
-------------------------
Underwriters as follows:
(a) The Company will not, either prior to the Effective Date or
thereafter during such period as the Prospectus is required by law to be
delivered in connection with sales of the Shares by any Underwriter or any
dealer, file any amendment or supplement to the Registration Statement
(including any filing under Rule 462(b) under the Act) or the Prospectus, unless
a copy thereof shall first have been submitted to the Representatives within a
reasonable period of time prior to the filing thereof and the Representatives
shall not have objected thereto in good faith.
(b) The Company will use its best efforts to cause the Rule 462(b)
Registration Statement and any post-effective amendment to the Registration
Statement to become effective, and will notify the Representatives promptly, and
will confirm such advice in writing, (1) when any Rule 462(b) Registration
Statement and any post-effective amendment to the Registration Statement become
15
effective, (2) of the receipt of any comments from or any request by the
Commission for amendments or supplements to the Registration Statement or the
Prospectus or for additional information, (3) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration Statement or
the initiation of any proceedings for that purpose or the threat thereof, (4) of
the happening of any event during the period mentioned in the second sentence of
Section 5v(e) that in the judgment of the Company makes any statement made in
the Registration Statement or the Prospectus untrue or that requires the making
of any changes in the Registration Statement or the Prospectus in order to make
the statements therein, in light of the circumstances in which they are made,
not misleading, and (5) of receipt by the Company or any representative or
attorney of the Company of any other communication from the Commission relating
to the Company, the Registration Statement, any Preliminary Prospectus or the
Prospectus. If at any time the Commission shall issue any order suspending the
effectiveness of the Registration Statement, the Company will make every
reasonable effort to obtain the withdrawal of such order at the earliest
possible moment.
(c) The Company will furnish to the Representatives, without charge,
four copies of the signed copies of the Registration Statement and of any post-
effective amendment thereto, including financial statements and schedules, and
all exhibits thereto (including any document filed under the Exchange Act and
deemed to be incorporated by reference into the Prospectus) and will furnish to
the Representatives, without charge, for transmittal to each of the other
Underwriters, copies of the Registration Statement and any post-effective
amendment thereto, including financial statements and schedules but without
exhibits.
(d) The Company will comply with all the provisions of any
undertakings contained in the Registration Statement.
(e) The Company will deliver to each of the Underwriters, without
charge, as many copies of the Prospectus or any amendment or supplement thereto
as the Representatives may reasonably request. The Company consents to the use
of the Prospectus or any amendment or supplement thereto by the several Under
writers and by all dealers to whom the Shares may be sold, both in connection
with the offering or sale of the Shares and for any period of time thereafter
during which the Prospectus is required by law to be delivered in connection
therewith. If during such period of time any event shall occur which in the
judgment of the Company or counsel to the Underwriters should be set forth in
the Prospectus in order to make any statement therein, in the light of the
circumstances under which
16
it was made, not misleading, or if it is necessary to supplement or amend the
Prospectus to comply with law, subject to the provisions of Section 5(a) hereof,
the Company will forthwith prepare and duly file with the Commission an
appropriate supplement or amendment thereto, and will deliver to the
Underwriters, without charge, such number of copies thereof as the
Representatives may reasonably request. The Company shall not file any document
under the Exchange Act before the termination of the offering of the Shares by
the Underwriters if such document would be deemed to be incorporated by
reference into the Prospectus which is not approved by the Representatives after
reasonable notice thereof.
(f) The Company will cooperate with the Representatives and counsel
to the Underwriters in connection with the registration or qualification of the
Shares and the Preferred Shares for offer and sale under the securities or Blue
Sky laws of such jurisdictions as the Representatives may reasonably request;
provided, that in no event shall the Company be obligated to qualify to do
- --------
business in any jurisdiction where it is not now so qualified or to take any
action which would subject it to general service of process in any jurisdiction
where it is not now so subject.
(g) During the period of five years commencing on the date hereof,
the Company will furnish to each of the Representatives and each other
Underwriter who may so request copies of such financial statements and other
periodic and special reports as the Company may from time to time distribute
generally to the holders of any class of its capital stock, and will furnish to
each of the Representatives and each other Underwriter who may so request a copy
of each annual or other report it shall be required to file with the Commission.
(h) The Company will make generally available to holders of its
securities as soon as may be practicable but in no event later than the last day
of the fifteenth full calendar month following the calendar quarter in which the
Effective Date falls, an earnings statement (which need not be audited but shall
be in reasonable detail), with respect to the Company, the Subsidiaries and the
Partner ships, for a period of 12 months commencing after the Effective Date of
the Registration Statement, and satisfying the provisions of Section 11(a) of
the Act (including Rule 158 thereunder) and will file such earnings statement as
an exhibit to the next periodic report required by Section 13 or 15(d) of the
Exchange Act covering the period when the earnings statement is released.
17
(i) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provisions hereof (otherwise than pursuant to the
second paragraph of Section 9 hereof or by notice given by you terminating this
Agreement pursuant to Section 9 or Section 10 hereof) or if this Agreement
shall be terminated by the Underwriters because of any failure or refusal on the
part of the Company to comply with the terms or fulfill any of the conditions of
this Agreement, the Company agrees to reimburse the Representatives for all
out-of-pocket expenses (including fees and expenses of counsel for the
Underwriters) reasonably incurred by you in connection herewith.
(j) The Company will not at any time, directly or indirectly, take
any action intended, or which might reasonably be expected, to cause or result
in, or which will constitute, stabilization of the price of the Shares to
facilitate the sale or resale of any of the Shares in violation of the Act.
(k) The Company will apply the net proceeds from the offering and
sale of the Shares in the manner set forth in the Prospectus under "Use of
Proceeds."
(l) The Company will use its best efforts to have the Shares listed,
subject to notice of issuance, on the New York Stock Exchange.
6. Conditions of Underwriters' Obligations. The several obligations
---------------------------------------
of the Underwriters to purchase the Firm Shares hereunder are subject to the
following conditions:
(a) All of the representations and warranties of the Company
contained in this Agreement shall be true and correct on the Closing Date with
the same force and effect as if made on and as of the Closing Date.
(b) The Registration Statement (including any post-effective
amendment thereto) shall have become effective not later than 5:00 P.M. (and, in
the case of a Registration Statement filed under Rule 462(b) of the Act, not
later than 10:00 p.m.), New York City time, on the date of this Agreement, or at
such later date and time as shall be consented to in writing by the
Representatives, and all filings, if any, required by Rules 424 and 430A under
the Act shall have been timely made; and at the Closing Date no stop order
suspending the effectiveness of the Registration Statement shall have been
issued and no proceedings for that purpose shall have been instituted or, to the
knowledge of the Company or any
18
Underwriter, contemplated by the Commission, and any request of the Commission
for additional information (to be included in the Registration Statement or the
Prospectus or otherwise) shall have been complied with to the satisfaction of
the Representatives.
(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 other), business,
properties, net worth, or results of operations of the Company, the Subsidiaries
or the Partnerships not contemplated by the Prospectus, which in your opinion,
as Representatives of the several Underwriters, would materially, adversely
affect the market for the Shares, or (ii) any event or development relating to
or involving the Company or any officer or director of the Company which makes
any statement made in the Prospectus untrue in any material respect or which, in
the opinion of the Company and its counsel or the Underwriters 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 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, as Representatives of the several Underwriters,
adversely affect the market for the Shares. On the Closing Date, the
Underwriters shall have received a certificate dated the Closing Date, signed by
each of the President and Chief Financial Officer of the Company confirming the
matters set forth in Sections 6(a), (b) and (c).
(d) The Underwriters shall have received an opinion, dated the
Closing Date and satisfactory in form and substance to counsel for the
Underwriters, from David Goldberg, counsel for the Company, to the effect that:
(i) Each of the Company, the Subsidiaries and the Partnerships
has been duly organized and is validly existing (in the case of the Company
and each of the Subsidiaries, as a corporation) in good standing under the
laws of the jurisdiction in which it is organized, with full power and
authority to own or lease and occupy its properties and conduct its
business as described in the Prospectus, and is duly qualified to do
business, and is in good standing, in each jurisdiction which requires such
qualification, except where the failure to so qualify would not,
individually or in the aggregate, have a Material Adverse Effect;
19
(ii) All of the Company's ownership interests in the
Partnerships are owned free and clear of any perfected security interest
and, to my knowledge, after due inquiry, any other security interests,
claims, liens or encumbrances;
(iii) The Company's authorized equity capitalization is as set
forth in the Prospectus; the capital stock of the Company conforms to the
description thereof contained in the Prospectus in all material respects;
the statements in the Prospectus Supplement under the caption "Description
of Preferred Stock and Depositary Shares" and in the Prospectus under the
captions "Description of Preferred Stock" and "Description of the
Depositary Shares," insofar as such statements constitute summaries of the
documents referred to therein, have been reviewed by such counsel and
fairly summarize the matters referred to therein in all material respects;
the outstanding shares of Common Stock, Class B Common Stock, Series A
Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, Series
D Preferred Stock, Series E Preferred Stock, Series F Preferred Stock,
Series G Preferred Stock, Series H Preferred Stock, Series I Preferred
Stock, Series J Preferred Stock, Series K Preferred Stock, Series L
Preferred Stock, Series M Preferred Stock, Series N Preferred Stock, Series
O Preferred Stock, Series P Preferred Stock, Series Q Preferred Stock,
Series A Equity Stock, Series AA Equity Stock and Series AAA Equity Stock
have been duly and validly authorized and issued and are fully paid and
nonassessable and the deposit of the Preferred Shares in accordance with
the Deposit Agreement has been duly authorized; the Shares and the
Preferred Shares have been duly and validly authorized, and, when issued
and delivered pursuant to the Agreement and the De posit Agreement and, in
the case of the Shares, paid for by the Underwriters pursuant to the
Agreement, will be fully paid and nonassessable; the Shares have been duly
authorized for listing, subject to official notice of issuance, on the New
York Stock Exchange; the forms of certificates for the Shares are in valid
and sufficient form in compliance with New York Stock Exchange
requirements; and the holders of outstanding shares of capital stock of the
Company are not entitled to preemptive or other rights to subscribe for the
Shares or the Preferred Stock;
20
(iv) To the best of my knowledge, after due inquiry, there is
no pending or threatened action, suit or proceeding before any court or
governmental agency, authority or body or arbitrator involving the Company,
any of the Subsidiaries or any of the Partnerships of a character required
to be disclosed in the Registration Statement which is not adequately
disclosed in the Prospectus, and there is no franchise, contract or other
document of a character required to be described in the Registration
Statement or Prospectus, or to be filed as an exhibit, which is not
described or filed as required; and, to the best of my knowledge, after
due inquiry, the statements in the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 2000 under Part II, Item 7 -
"Management's Discussion and Analysis of Financial Condition and Results of
Operations -Distribution Requirements" and under Part III, Item 13 -
"Certain Relationships and Related Transactions" and the Company's
Quarterly Report on Form 10-Q for the quarters ended March 31, 2001 and
June 30, 2001 under Part I, Item 2 -"Management's Discussion and Analysis
of Financial Condition and Results of Operations - Distribution
Requirements" (other than the financial statements and other financial and
statistical information contained therein, as to which such counsel need
not express any opinion) fairly summarize the matters therein described in
all material respects;
(v) The Registration Statement and the Prospectus and any
amendment or supplement thereto comply as to form in all material respects
with the requirements for the use of Form S-3 and the rules and regulations
thereunder, and the Registration Statement and the Prospectus and any
amendment or supplement thereto (other than the financial statements and
other financial information contained therein, as to which such counsel
need express no opinion) comply as to form in all material respects with
the requirements of the Act and the rules thereunder and each of the
Incorporated Documents (or, if any amendment with respect to any such
document was filed, when such document was filed), complied as to form in
all material respects with the requirements of the Exchange Act and the
rules thereunder (other than the financial statements and other financial
information contained therein, as to which such counsel need express no
opinion);
21
(vi) The Company has full corporate power and authority to
enter into and perform its obligations under the Agreement and the Deposit
Agreement and to issue, sell and deliver the Shares and to issue and
deliver the Preferred Stock; and the Agreement has been, and the Deposit
Agreement will have been as of the Closing Date, duly authorized, executed
and delivered by the Company;
(vii) No consent, approval, authorization or order of any court
or governmental agency, authority or body is required for the execution by
the Company of the Agreement or the Deposit Agreement, the performance by
the Company of its obligations hereunder or thereunder or the consummation
of the transactions contemplated herein or therein, except such as have
been obtained under the Act and the Exchange Act and such as may be
required under the Blue Sky laws of any jurisdiction in connection with the
purchase and distribution by the Underwriters of the Shares;
(viii) The Company, each Subsidiary and each Partnership have all
requisite power and authority, and, to the best knowledge of such counsel,
after due inquiry, all necessary material authorizations, approvals,
orders, licenses, certificates and permits of and from all regulatory or
governmental officials, bodies and tribunals, to own or lease their
respective properties and to conduct their respective businesses as now
being conducted and as described in the Prospectus; and, to the best of my
knowledge, after due inquiry, all such authorizations, approvals, licenses,
certificates and permits are in full force and effect, except where the
failure to be in full force and effect would not have a Material Adverse
Effect on the Company, such Subsidiary or such Partnership, and the
Company, each Subsidiary and each Partnership are complying with all
applicable laws, the violation of which could have a Material Adverse
Effect on the Company, such Subsidiary or such Partnership, as the case may
be;
(ix) The Company and each of the Subsidiaries are not in
violation of its articles of incorporation or by-laws, and each of the
Partnerships is not in violation of its respective partnership agreement,
and to the best of my knowledge, after due inquiry,
22
neither the Company, the Subsidiaries nor any Partnership is in default in
the performance of any obligation, agreement or condition contained in any
loan, note or other evidence of indebtedness or in any indenture, mortgage,
deed of trust or any other material agreement by which it or its properties
are bound, except for such defaults as could not, individually or the
aggregate, have a Material Adverse Effect on the Company, such Subsidiary
or such Partnership, as the case may be;
(x) Neither the issue and sale of the Shares nor the
consummation of any of the other transactions contemplated by the Agreement
(including without limitation the execution, delivery and performance of
the Deposit Agreement, the issuance and deposit of the Preferred Shares in
accordance with the Deposit Agreement and the consummation of the
transactions contemplated therein) nor the fulfillment of the terms hereof
or thereof will conflict with, result in a breach or violation of, or
constitute a default under any law or the articles of incorporation or by-
laws of the Company or the Subsidiaries or the partnership agreement of
any of the Partnerships or the terms of any indenture or other agreement or
instrument known to me and to which the Company, any of the Subsidiaries or
any of the Partnerships is a party or is bound or any judgment, order or
decree known to me to be applicable to the Company, any of the Subsidiaries
or any of the Partnerships of any court, regulatory body, administrative
agency, governmental body or arbitrator having jurisdiction over the
Company, any of the Subsidiaries or any of the Partnerships;
(xi) No holders of securities of the Company have rights to the
registration of such securities under the Registration Statement, except as
provided therein;
(xii) Any required filing of the Prospectus, and any supplements
thereto, pursuant to Rule 424(b) has been made in the manner and within the
time period required by Rule 424(b); and, to the best of my knowledge, no
stop order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have been instituted or
threatened;
23
(xii) To the best of such counsel's knowledge, after reasonable
inquiry, neither the Company, any of the Subsidiaries nor any of the
Partnerships is in violation of any law, ordinance, administrative or
governmental rule or regulation applicable to the Company, any of the
Subsidiaries or any of the Partnerships or of any decree of any court or
governmental agency or body having jurisdiction over the Company, any of
the Subsidiaries or any of the Partnerships, the violation of which could
have a Material Adverse Effect on the Company, such Subsidiary or such
Partnership, as the case may be;
(xiv) The statements in the Registration Statement and
Prospectus, insofar as they are descriptions of contracts, agreements or
other legal documents, or refer to statements of law or legal conclusions,
are accurate and present fairly the information required to be shown in all
material respects;
(xv) The Company, the Subsidiaries and the Partnerships own or
have the right to use all patents, trademarks, trademark registrations,
service marks, service mark registrations, trade names, copyrights,
licenses, inventions, trade secrets and rights described in the Prospectus
as being owned by them or any of them or necessary for the conduct of their
respective businesses, and, other than routine proceedings which if
adversely determined would not materially affect the business of the
Company, the Subsidiaries and the Partnerships taken as a whole as
described in the Prospectus, such counsel is not aware of any claim to the
contrary or any challenge by any other person to the rights of the
Company, the Subsidiaries and the Partnerships with respect to the
foregoing;
(xvi) Except as described in the Prospectus and in Section 4(r)
of the Agreement, to the best of such counsel's knowledge, after
reasonable inquiry, there are no outstanding options, warrants or other
rights calling for the issuance of, and there are no commitments, plans or
arrangements to issue, any shares of capital stock of the Company or any
security convertible into or exchangeable or exercisable for capital stock
of the Company;
24
(xvii) Except as described in the Prospectus and in Section
4(r) of the Agreement, to the best of such counsel's knowledge, after
reasonable inquiry, there is no holder of any security of the Company or
any other person who has the right, contractual or otherwise, to cause the
Company to sell or otherwise issue to them, or to permit them to underwrite
the sale of, the Shares or the Preferred Shares or the right to have any
Common Stock or other securities of the Company included in the
Registration Statement or the right, as a result of the filing of the
Registration Statement, to require registration under the Act of any shares
of Common Stock or other securities of the Company;
(xviii) Assuming due authorization, execution and delivery by
the Depositary, the Deposit Agreement constitutes the valid and binding
agreement of the Company, enforceable against the Company in accordance
with its terms, except to the extent that enforcement thereof may be
limited by (i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity and (regardless of whether
a proceeding is considered at law or in equity);
(xix) When the Shares evidenced by the Depositary Receipts are
issued and delivered in accordance with the terms of the Deposit Agreement
against the deposit of duly authorized and is sued, fully paid and
nonassessable shares of Preferred Stock, the Depositary Receipts will
entitle the holders thereof to the benefits provided therein and in the
Deposit Agreement.
In addition, such counsel shall state that he has participated in
conferences with representatives of the Underwriters, and with officers and
other representatives of the Company and representatives of the independent
certified public accountants of the Company, at which conferences the contents
of the Registration Statement and the Prospectus and related matters were
discussed and, although such counsel does not pass upon and does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and the Prospectus, on the basis of the
foregoing (relying as to certain factual matters on the information provided to
such counsel by the Company and not on an independent investigation, but in the
absence of informa-
25
tion to the contrary), no facts have come to such counsel's attention which
leads such counsel to believe that the Registration Statement, as of its
effective date, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus, as of its date and as
of the date hereof, contained an untrue statement of a material fact or omitted
to state a material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided that
--------
such counsel need not express any comment with respect to the financial
statements and other financial data included in the Registration Statement or
Prospectus.
(e) The Underwriters shall have received an opinion, dated the
Closing Date and satisfactory in form and substance to counsel for the
Underwriters, from Hogan & Hartson L.L.P., counsel for the Company, to the
effect that:
(i) The statements in the Prospectus under the heading
"Federal Income Tax Consequences" and "Risk Factors - We would incur
adverse tax consequences if we fail to qualify as a REIT" and "Risk Factors
- We would incur a corporate level tax if we sell certain assets" read in
conjunction with the statements in the Prospectus Supplement under the
heading "Federal Income Tax Consequences," to the extent that they describe
matters of law or legal conclusions, are correct in all material respects.
(ii) Based upon current law, including relevant statutes,
regulations and judicial and administrative precedent (which law is subject
to change on a retroactive basis), and subject to the limitations and
qualifications set forth in such counsel's tax opinion filed as Exhibit 8.1
to the Registration Statement, the Company is organized and currently
operates in conformity with the require requirements for qualification and
taxation as a real estate investment trust ("REIT") under the Code, and the
Company's proposed method of operation (as described in the Prospectus,
Prospectus Supplement and the Management Representation Letter) will enable
the Company to continue to meet the requirements for qualification and
taxation as a REIT for the taxable year ending December 31, 2001, and for
subsequent taxable years. The Underwriters may rely upon such counsel's
tax opinion filed as Exhibit 8.1 to the Registra-
26
tion Statement to the same extent as if it were set forth in full herein.
(f) The Underwriters shall have received an opinion, dated the
Closing Date from Skadden, Arps, Slate, Meagher & Flom LLP, counsel to the
Underwriters, with respect to the Registration Statement, the Prospectus and
this Agreement, which opinion shall be satisfactory in all respects to the
Representatives, and such counsel shall have been provided by the Company with
such documents and information as they may reasonably request to enable them to
pass on such matters.
(g) You shall have received letters addressed to you, as
Representatives of the several Underwriters, and dated the date hereof and the
Closing Date from Ernst & Young LLP, independent certified public accountants,
substantially in the forms heretofore approved by you.
(h) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been taken or, to the knowledge of the Company, shall be
contemplated by the Commission at or prior to the Closing Date; (ii) there shall
not have been any material change in the capital stock of the Company nor any
material increase in the short-term or long-term debt of the Company (other than
in the ordinary course of business) from that set forth or contemplated in the
Registration Statement or the Prospectus (or any amendment or supplement
thereto); (iii) there shall not have been, since the respective dates as of
which information is given in the Registration Statement and the Prospectus (or
any amendment or supplement thereto), except as may otherwise be stated in the
Registration Statement and Prospectus (or any amendment or supplement thereto),
any material adverse change in the condition (financial or other), business,
prospects, properties, net worth or results of opera operations of the Company,
the Subsidiaries and the Partnerships taken as a whole; (iv) the Company, the
Subsidiaries and the Partnerships shall not have any liabilities or obligations,
direct or contingent (whether or not in the ordinary course of business), that
are material to the Company, the Subsidiaries, and the Partnerships, taken as a
whole, other than those reflected in the Registration Statement or the
Prospectus (or any amendment or supplement thereto); and (v) all the
representations and warranties of the Company contained in this Agreement shall
be true and correct in all material respects on and as of the date hereof and on
and as of the Closing Date as if made on and as of the Closing Date, and you
shall have received a certificate, dated the Closing Date and signed by the
chief executive officer and the chief financial officer of the Company (or such
other officers as are
27
acceptable to you), to the effect set forth in this Section 6(g) and in
Section 6(h) hereof.
(i) The Company shall not have failed at or prior to the Closing Date
to have performed or complied with any of its agreements herein contained or
contained in the Deposit Agreement and required to be performed or complied with
by it hereunder or thereunder at or prior to the Closing Date.
(j) Prior to the Closing Date the Shares shall have been listed,
subject to notice of issuance, on the New York Stock Exchange.
(k) The Company shall have furnished or caused to be furnished to you
such further certificates and documents as you shall have requested.
All such opinions, certificates, letters and other documents will be
in compliance with the provisions hereof only if they are satisfactory in form
and substance to you and your counsel.
Any certificate or document signed by any officer of the Company and
delivered to you, as Representatives of the Underwriters, or to counsel for the
Underwriters, shall be deemed a representation and warranty by the Company to
each Underwriter as to the statements made therein.
The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the satisfaction on and as of any Option Closing
Date of the conditions set forth in this Section 6, except that, if any Option
Closing Date is other than the Closing Date, the certificates, opinions and
letters referred to in paragraphs (d) through (h) shall be dated the Option
Closing Date in question and the opinions called for by paragraphs (d), (e) and
(f) shall be revised to reflect the sale of Additional Shares.
7. Indemnification and Contribution.
--------------------------------
(a) The Company agrees to indemnify and hold harmless each of you and
each other Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
from and against any and all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation) arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in any
28
Preliminary Prospectus or in the Registration Statement or the Prospectus or in
any amendment or supplement thereto, or arising out of or based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon and in conformity with the information relating to such
Underwriter furnished in writing to the Company by or on behalf of any
Underwriter through you expressly for use in connection therewith; provided,
however, that the indemnification contained in this paragraph (a) with respect
to any Preliminary Prospectus shall not inure to the benefit of any Underwriter
(or to the benefit of any person controlling such Underwriter) on account of any
such loss, claim, damage, liability or expense arising from the sale of the
Shares by such Underwriter to any person if a copy of the Prospectus shall not
have been delivered or sent to such person within the time required by the Act
and the regulations thereunder, and the untrue statement or alleged untrue
statement or omission or alleged omission of a material fact contained in such
Preliminary Prospectus was corrected in the Prospectus, provided that the
Company has delivered the Prospectus to the several Underwriters in requisite
quantity on a timely basis to permit such delivery or sending. The foregoing
indemnity agreement shall be in addition to any liability which the Company
may otherwise have.
(b) If any action, suit or proceeding shall be brought against any
Underwriter or any person controlling any Underwriter in respect of which
indemnity may be sought against the Company, such Underwriter or such
controlling person shall promptly notify the Company (but failure to so notify
the Company shall not relieve the Company from any liability hereunder to the
extent it is not materially prejudiced as a result thereof and in any event
shall not relieve it from any liability which it may have otherwise than on
account of this indemnity agreement) and the Company shall assume the defense
thereof, including the employment of counsel and payment of all fees and
expenses; provided, however, that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be one or more legal defenses
available to it and/or other indemnified parties which are different from or
additional to those available to the indemnifying party, the indemnifying party
shall not have the right to direct the defense of such action on behalf of such
indemnified party or parties and such indemnified party or parties shall have
the right to select separate counsel to defend such action on behalf of such
indemnified party or parties. Such Underwriter or any such
29
controlling person shall have the right to employ separate counsel in any such
action, suit or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such Underwriter or
such controlling person unless (i) the Company has agreed in writing to pay such
fees and expenses, (ii) the Company has failed promptly to assume the defense
and employ counsel, or (iii) the named parties to any such action, suit or
proceeding (including any impleaded parties) include both such Underwriter or
such controlling person and the Company and such Underwriter or such controlling
person shall have been advised by its counsel that representation of such
indemnified party and the Company by the same counsel would be inappropriate
under applicable standards of professional conduct (whether or not such
representation by the same counsel has been proposed) due to actual or potential
differing interests between them (in which case the Company shall not have the
right to assume the defense of such action, suit or proceeding on behalf of such
Underwriter or such controlling person). It is understood, however, that the
Company shall, in connection with any one such action, suit or proceeding or
separate but substantially similar or related actions, suits or proceedings in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
all such Underwriters and controlling persons not having actual or potential
differing interests with you or among themselves, which firm shall be designated
in writing by Salomon Smith Barney Inc., and that all such fees and expenses
shall be reimbursed as they are incurred. The Company shall not be liable for
any settlement of any such action, suit or proceeding effected without its
written consent, but if settled with such written consent, or if there be a
final judgment for the plaintiff in any such action, suit or proceeding, the
Company agrees to indemnify and hold harmless any Underwriter, to the extent
provided in the preceding paragraph, and any such controlling person from and
against any loss, claim, damage, liability or expense by reason of such
settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement, and any person who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the same
extent as the foregoing indemnity from the Company to each Underwriter, but only
with respect to information relating to such Underwriter furnished in writing by
or on behalf of such Underwriter through you expressly for use in the
Registration Statement, the Prospectus or any Preliminary Prospectus, or any
amendment or supplement thereto. If any action, suit or proceeding shall be
brought against
30
Company, any of its directors, any such officer, or any such controlling person
based on the Registration Statement, the Prospectus or any Preliminary
Prospectus, or any amendment or supplement thereto, and in respect of which
indemnity may be sought against any Underwriter pursuant to this paragraph (c),
such Underwriter shall have the rights and duties given to the Company by
paragraph (b) above (except that if the Company shall have assumed the defense
thereof such Under writer shall not be required to do so, but may employ
separate counsel therein and participate in the defense thereof, but the fees
and expenses of such counsel shall be at such Underwriter's expense), and the
Company, its directors, any such officer, and any such controlling person shall
have the rights and duties given to the Underwriters by paragraph (b) above. The
foregoing indemnity agreement shall be in addition to any liability which the
Underwriters may otherwise have.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under paragraph (a) or (c) hereof in respect
of any losses, claims, damages, liabilities or expenses referred to therein,
then an indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Shares, or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the table
on the cover page of the Prospectus. The relative fault of the Company on the
one hand and the Underwriters on the other hand shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or by the
Underwriters on the other hand and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
31
(e) The Company and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 7 were determined by a
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in paragraph (d) above. The amount paid
or payable by an indemnified party as a result of the losses, claims, damages,
liabilities and expenses referred to in paragraph (d) above shall be deemed to
include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
any claim or defending any such action, suit or proceeding. Notwithstanding the
provisions of this Section 7, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price of the Shares
underwritten by it and distributed to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective numbers of Firm Shares set forth opposite their names in Schedule I
hereto (or such numbers of Firm Shares increased as set forth in Section 9
hereof) and not joint.
(f) No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
action, suit or 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 action, suit or proceeding and does not include a statement as to or an
admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
(g) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 7(b) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such
32
indemnified party in accordance with such request prior to the date of such
settlement. Notwithstanding the immediately preceding 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, an indemnifying party shall
not be liable for any settlement of the nature contemplated by Section 7(b)
effected without its consent if such indemnifying party (i) reimburses such
indemnified party in accordance with such request to the extent such
indemnifying party considers such request to be reasonable and (ii) provides
written notice to the indemnified party substantiating the unpaid balance as
unreasonable, in each case prior to the date of such settlement.
(h) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 7 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 7 and the
representations and warranties of the Company set forth in this Agreement shall
remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter, the Company, its directors or officers, or any person
controlling the Company, (ii) acceptance of any Shares and payment therefor
hereunder, and (iii) any termination of this Agreement. A successor to any
Underwriter or any person controlling any Underwriter, or to the Company, its
directors or officers, or any person controlling the Company, shall be entitled
to the benefits of the indemnity, contribution and reimbursement agreements
contained in this Section 7.
8. Expenses.
--------
The Company agrees to pay the following costs and expenses and all
other costs and expenses incident to the performance by it of its obligations
hereunder: (i) the preparation, printing or reproduction, and filing with the
Commission of the Registration Statement (including financial statements and
exhibits thereto), the Preliminary Prospectus, the Prospectus, and each
amendment or supplement to any of them; (ii) the printing (or reproduction) and
delivery (including postage, air freight charges and charges for counting and
packaging) of such copies of the Registration Statement, the Preliminary
Prospectus, the Prospectus, the Incorporated Documents, and all amendments or
supplements to any of them, as may be reasonably requested for use in connection
with the offering and sale of the Shares; (iii) the preparation, printing,
authentication, issuance and
33
delivery of certificates for the Shares and the Preferred Shares, including any
stamp taxes in connection with the original issuance and sale of the Shares and
the Preferred Shares; (iv) the printing (or reproduction) and delivery of this
Agreement, the preliminary and supplemental Blue Sky Memoranda, the Deposit
Agreement and all other agreements or documents printed (or reproduced) and
delivered in connection with the offering of the Shares and the Preferred
Shares; (v) the fees and expenses of the Depositary, including the fees and
disbursements of counsel for the Depositary, if any; (vi) the registration of
the Shares under the Exchange Act and the listing of the Shares on the New York
Stock Exchange; (vii) the registration or qualification of the Shares and the
Preferred Shares for offer and sale under the securities or Blue Sky laws of the
several states as provided in Section 5(f) hereof (including the reasonable
fees, expenses and disbursements of counsel for the Underwriters relating to the
preparation, printing or reproduction, and delivery of the preliminary and
supplemental Blue Sky Memoranda and such registration and qualification); (viii)
the filing fees and the fees and expenses of counsel for the Underwriters in
connection with any filings required to be made with the National Association of
Securities Dealers, Inc.; (ix) the transportation and other expenses incurred by
or on behalf of Company representatives in connection with presentations to
prospective purchasers of the Shares; and (x) the fees and expenses of the
Company's accountants and the fees and expenses of counsel (including local and
special counsel) for the Company.
9. Effective Date of Agreement.
---------------------------
This Agreement shall become effective: (i) upon the execution and
delivery hereof by the parties hereto; or (ii) if, at the time this Agreement is
executed and delivered, it is necessary for a post-effective amendment to the
Registration Statement or a Rule 462 Registration Statement to be declared or
become effective before the offering of the Shares may commence, when
notification of the effectiveness of such post-effective amendment has been
released by the Commission or, in the case of a Rule 462(b) Registration
Statement, upon filing thereof. Until such time as this Agreement shall have
become effective, it may be terminated by the Company, by notifying you, or by
you, as Representatives of the several Underwriters, by notifying the Company.
If any one or more of the Underwriters shall fail or refuse to
purchase Shares which it or they are obligated to purchase hereunder on the
Closing Date, and the aggregate number of Shares which such defaulting
Underwriter or Underwriters are obligated but fail or refuse to purchase is not
more than
34
one-tenth of the aggregate number of Shares which the Underwriters are obligated
to purchase on the Closing Date, each non-defaulting Underwriter shall be
obligated, severally, in the proportion which the number of Firm Shares set
forth opposite its name in Schedule I hereto bears to the aggregate number of
Firm Shares set forth opposite the names of all non-defaulting Underwriters or
in such other proportion as you may specify in accordance with Section 20 of the
Master Agreement Among Underwriters of Salomon Smith Barney Inc., to purchase
the Shares which such defaulting Underwriter or Underwriters are obligated, but
fail or refuse, to purchase. If any one or more of the Underwriters shall fail
or refuse to purchase Shares which it or they are obligated to purchase on the
Closing Date and the aggregate number of Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Shares which
the Underwriters are obligated to purchase on the Closing Date and arrangements
satisfactory to you and the Company for the purchase of such Shares by one or
more non-defaulting Underwriters or other party or parties approved by you and
the Company are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Underwriter or the
Company. In any such case which does not result in termination of this
Agreement, either you or the Company shall have the right to postpone the
Closing Date, but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and the Prospectus or
any other documents or arrangements may be effected. Any action taken under this
paragraph shall not relieve any defaulting Underwriter from liability in respect
of any such default of any such Underwriter under this Agreement. The term
"Underwriter" as used in this Agreement includes, for all purposes of this
Agreement, any party not listed in Schedule I hereto who, with your approval and
the approval of the Company, purchases Shares which a defaulting Underwriter is
obligated, but fails or refuses, to purchase.
Any notice under this Section 9 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
10. Termination.
-----------
This Agreement shall be subject to termination in your absolute
discretion, without liability on the part of any Underwriter to the Company by
notice to the Company, if prior to the Closing Date or any Option Closing Date
(if different from the Closing Date and then only as to the Additional Shares),
as the case may be, (i) there has been, since the time of execution of this
Agreement or
35
since the respective dates as of which information is given in the Prospectus,
any material adverse change, or any development involving a prospective material
adverse change, in the condition, financial or otherwise, or in the business,
properties, net worth or results of operations of the Company, the Subsidiaries
or the Partnerships, whether or not arising in the ordinary course of business,
(ii) trading in securities generally on the New York Stock Exchange, the
American Stock Exchange or the Nasdaq National Market shall have been suspended
or materially limited, (iii) a general moratorium on commercial banking
activities in New York or California shall have been declared by either federal
or state authorities, or (iv) there shall have occurred any outbreak or
escalation of hostilities or other international or domestic calamity, crisis or
change in political, financial or economic conditions, the effect of which on
the financial markets of the United States is such as to make it, in your
judgment, impracticable or inadvisable to commence or continue the offering of
the Shares at the offering price to the public set forth on the cover page of
the Prospectus or to enforce contracts for the resale of the Shares by the
Underwriters. Notice of such termination may be given to the Company by
telegram, telecopy or telephone and shall be subsequently confirmed by letter.
11. Information Furnished by the Underwriters.
-----------------------------------------
The statements set forth in the last paragraph on the cover page, the
stabilization legend on the inside front cover and the statements in the first
three paragraphs and the seventh paragraph under the caption "Underwriting" in
the Prospectus Supplement constitute the only information furnished by or on
behalf of the Underwriters through you as such information is referred to in
Sections 4(b) and 7 hereof.
12. Miscellaneous.
-------------
Except as otherwise provided in Sections 3, 9 and 10 hereof, notice
given pursuant to any provision of this Agreement shall be in writing and shall
be delivered (i) if to the Company, at the office of the Company, Public
Storage, Inc., 701 Western Avenue, 2nd Floor, Glendale, California 91201-2397,
Attention: Legal Department, or (ii) if to you, as Representatives of the
several Underwriters, care of Salomon Smith Barney Inc., 388 Greenwich Street,
New York, New York 10013, Attention: Office of the General Counsel.
36
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Company, its directors and officers, and the other
controlling persons referred to in Section 7 hereof and their respective
successors and assigns, to the extent provided hererein, and no other person
shall acquire or have any right under or by virtue of this Agreement. Neither
the term "successor" nor the term "successors and assigns" as used in this
Agreement shall include a purchaser from any Underwriter of any of the Shares in
his status as such purchaser.
13. Applicable Law; Counterparts.
----------------------------
This agreement shall be governed by and construed in accordance with
the laws of the State of New York, including without limitation Section 5-1401
of the New York General Obligations Law.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
37
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the several Underwriters.
Very truly yours,
PUBLIC STORAGE, INC.
By /s/ David Goldberg
-------------------------------------------------
David Goldberg
Vice President
Confirmed as of the date first
above mentioned on behalf of
themselves and the other several
Underwriters named in Schedule I
hereto.
SALOMON SMITH BARNEY INC.
A.G. EDWARDS & SONS, INC.
FIRST UNION SECURITIES, INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
MORGAN STANLEY & CO. INCORPORATED
UBS WARBURG LLC
CIBC WORLD MARKETS CORP.
CREDIT SUISSE FIRST BOSTON CORPORATION
DEUTSCHE BANC ALEX. BROWN INC.
PRUDENTIAL SECURITIES INCORPORATED
RAYMOND JAMES & ASSOCIATES, INC.
As Representatives of the Several Underwriters
By: SALOMON SMITH BARNEY INC.
By /s/ Dan Guglielmone
-----------------------------------
Dan Guglielmone
Director
SCHEDULE I
PUBLIC STORAGE, INC.
20,000,000 Depositary Shares
Number of
Underwriters Firm Shares
- ------------ -----------
Salomon Smith Barney Inc........................................ 2,900,000
A.G. Edwards & Sons, Inc........................................ 2,760,000
First Union Securities, Inc..................................... 2,760,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated.............. 2,760,000
Morgan Stanley & Co............................................. 2,760,000
UBS Warburg LLC................................................. 2,760,000
CIBC World Markets Corp......................................... 200,000
Credit Suisse First Boston Corporation.......................... 200,000
Deutsche Banc Alex. Brown Inc................................... 200,000
Prudential Securities Incorporated.............................. 200,000
Raymond James & Associates, Inc................................. 200,000
ABN Amro Incorporated........................................... 100,000
Bear, Stearns & Co. Inc......................................... 100,000
Charles Schwab & Co., Inc....................................... 100,000
Dain Rauscher Incorporated...................................... 100,000
J.P. Morgan Chase & Co.......................................... 100,000
H&R BLOCK Financial Advisors, Inc............................... 100,000
Legg Mason Wood Walker, Inc..................................... 100,000
McDonald Investments Inc.*...................................... 100,000
Quick & Reilly, Inc............................................. 100,000
Tucker Anthony Incorporated..................................... 100,000
U.S. Bancorp Piper Jaffray Inc.................................. 100,000
Wells Fargo Van Kasper, LLC..................................... 100,000
Advest, Inc..................................................... 50,000
BB&T Capital Markets, a Division of Scott & Stringfellow, Inc... 50,000
C.L. King & Associates, Inc..................................... 50,000
Crowell, Weedon & Co............................................ 50,000
D.A. Davidson & Co.............................................. 50,000
Davenport & Company LLC......................................... 50,000
Fahnestock & Co. Inc............................................ 50,000
Gibraltar Securities............................................ 50,000
Gruntal & Co., L.L.C............................................ 50,000
HSBC Securities (USA) Inc....................................... 50,000
J.J.B. Hilliard, W.L. Lyons, Inc................................ 50,000
Janney Montgomery Scott LLC..................................... 50,000
Mesirow Financial, Inc.......................................... 50,000
Morgan Keegan & Company, Inc.................................... 50,000
NatCity Investments, Inc........................................ 50,000
Parker/Hunter Incorporated...................................... 50,000
Robert W. Baird & Co. Incorporated.............................. 50,000
SWS Securities, Inc............................................. 50,000
Stifel, Nicolaus & Company, Incorporated........................ 50,000
Wachovia Securities, Inc........................................ 50,000
Wedbush Morgan Securities Inc................................... 50,000
William Blair & Company, L.L.C.................................. 50,000
----------
Total....................................................... 20,000,000
==========
* McDonald Investments Inc. is a member of the Key financial network.