EXHIBIT 1.1
Execution Copy
3,000,000 SHARES
HEALTH CARE REIT, INC.
Common Stock
($1.00 Par Value)
UNDERWRITING AGREEMENT
April 6, 2006
Deutsche Bank Securities Inc.
UBS Securities LLC
As Representatives of the Several Underwriters
c/o Deutsche Bank Securities Inc.
60 Wall Street, 4th Floor
New York, New York 10005
Ladies and Gentlemen:
Health Care REIT, Inc., a Delaware corporation (the "Company"),
proposes to sell to the underwriters (the "Underwriters") named in Schedule I
hereto for whom you are acting as representatives (the "Representatives"), an
aggregate of 3,000,000 shares (the "Firm Shares") of the Company's Common Stock,
$1.00 par value per share (the "Common Stock"). The Company also proposes to
sell at the Underwriters' option an aggregate of up to 450,000 additional shares
of the Company's Common Stock (the "Option Shares") as set forth below.
As the Representatives, you have advised the Company (a) that you are
authorized to enter into this Agreement and (b) that the Underwriters are
willing to purchase, acting severally and not jointly, the Firm Shares set forth
in Schedule I hereto, plus such Option Shares if the Underwriters elect to
exercise the over-allotment option in whole or in part for the account of the
Underwriters. The Firm Shares and the Option Shares (to the extent such option
is exercised) are herein collectively sometimes referred to as the "Shares."
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the parties
hereto agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to the Underwriters as follows:
(i) A registration statement on Form S-3 (File No.
333-120917) in respect of the Shares, including a form of prospectus
(the "Base Prospectus"), has been prepared and filed by the Company not
earlier than three years prior to the date hereof, in conformity with
the requirements of the Securities Act of 1933, as amended (the
"Securities Act"), and the rules and regulations of the Securities and
Exchange Commission (the "Commission") thereunder (the "Rules and
Regulations"). The Company and the transactions contemplated by this
Agreement
meet the requirements and comply with the conditions for the use of
Form S-3. Copies of such registration statement, including any
amendments thereto, the Base Prospectus, as supplemented by any
preliminary prospectus (including any preliminary prospectus
supplement) relating to the Shares used prior to the date hereof (a
"Preliminary Prospectus"), and including the documents incorporated in
the Base Prospectus by reference, and the exhibits, financial
statements and schedules to such registration statement, in each case
as finally amended and revised, have heretofore been delivered by the
Company to the Representatives. Such registration statement is herein
referred to as the "Registration Statement," which shall be deemed to
include all information omitted therefrom in reliance upon Rules 430A,
430B or 430C under the Securities Act and contained in the Prospectus
referred to below, has become effective under the Securities Act and no
post-effective amendment to the Registration Statement has been filed
as of the date of this Agreement. "Prospectus" means the form of
prospectus relating to the Shares first filed with the Commission
pursuant to and within the time limits described in Rule 424(b) under
the Securities Act and in accordance with Section 4(i) hereof. Any
reference herein to the Registration Statement, any Preliminary
Prospectus or to the Prospectus or to any amendment or supplement to
any of the foregoing documents shall be deemed to refer to and include
any documents incorporated by reference therein, and, in the case of
any reference herein to the Prospectus, also shall be deemed to include
any documents incorporated by reference therein, and any supplements or
amendments thereto, filed with the Commission after the date of filing
of the Prospectus under Rule 424(b) under the Securities Act, and prior
to the termination of the offering of the Shares by the Underwriters.
(ii) As of the Applicable Time (as defined below), at all
times during the period that begins at the Applicable Time and ends as
of the Closing Date, and as of the Closing Date or the Option Closing
Date, as the case may be, neither (i) the General Use Free Writing
Prospectus(es) (as defined below) issued at or prior to the Applicable
Time, the Statutory Prospectus (as defined below) and the information
included on Schedule II hereto, all considered together (collectively,
the "General Disclosure Package"), nor (ii) any individual Limited Use
Free Writing Prospectus (as defined below), when considered together
with the General Disclosure Package, included or will include any
untrue statement of a material fact or omitted or will 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
warranties as to information contained in or omitted from any Issuer
Free Writing Prospectus, in reliance upon, and in conformity with,
written information furnished to the Company by or on behalf of any
Underwriter through the Representatives, specifically for use therein,
it being understood and agreed that the only such information is that
described in Section 13 herein. As used in this subsection and
elsewhere in this Agreement:
"Applicable Time" means 11:00 pm (New York time) on the date
of this Agreement or such other time as agreed to by the Company and
the Representatives.
"Statutory Prospectus" means the Base Prospectus, as amended
and supplemented immediately prior to the Applicable Time, including
any document incorporated by reference therein and any prospectus
supplement deemed to be a part thereof.
"Issuer Free Writing Prospectus" means any "issuer free
writing prospectus," as defined in Rule 433 under the Securities Act,
relating to the Shares in the form filed or required to be filed with
the Commission or, if not required to be filed, in the form retained in
the Company's records pursuant to Rule 433(g) under the Securities Act.
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"General Use Free Writing Prospectus" means any Issuer Free
Writing Prospectus that is identified on Schedule III to this
Agreement.
"Limited Use Free Writing Prospectus" means any Issuer Free
Writing Prospectus that is not a General Use Free Writing Prospectus.
(iii) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with corporate power and authority to own its properties
and conduct its business as described in the Registration Statement,
the General Disclosure Package and the Prospectus; the Company is duly
qualified to transact business in all jurisdictions in which the
conduct of its business requires such qualification, and in which the
failure to qualify would (a) have a materially adverse effect upon the
business of the Company and its Subsidiaries (as defined below), taken
as a whole, (b) adversely affect the issuance, validity or
enforceability of the Shares or (c) adversely affect the consummation
of the transactions contemplated by this Agreement (each of (a), (b)
and (c) above, a "Material Adverse Effect"). All of the Company's
subsidiaries are listed in Schedule IV hereto (the "Subsidiaries").
(iv) The information contained in the section captioned
"Capitalization" in the Registration Statement and the Prospectus (and
any similar section or information contained in the General Disclosure
Package) sets forth the authorized, issued and outstanding
capitalization of the Company at the indicated date; all of the issued
shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable; the shares
of Common Stock of the Company are duly listed on the New York Stock
Exchange; the Shares to be issued and sold by the Company have been
duly authorized and when issued and paid for as contemplated herein
will be validly issued, fully-paid and non-assessable; and no
preemptive or similar rights of stockholders exist with respect to any
of the Shares or the issue and sale thereof.
(v) The shares of authorized capital stock of the Company,
including the Shares, conform with the statements concerning them in
the Registration Statement, the General Disclosure Package and the
Prospectus.
(vi) The Commission has not issued an order preventing or
suspending the use of any Preliminary Prospectus, any Issuer Free
Writing Prospectus or the Prospectus relating to the proposed offering
of the Shares, and no proceeding for that purpose or pursuant to
Section 8A of the Securities Act has been instituted or, to the
Company's knowledge, threatened by the Commission. The Registration
Statement contains, and the Prospectus and any amendments or
supplements thereto will contain, all statements which are required to
be stated therein by, and will conform to, the requirements of the
Securities Act. The documents incorporated, or to be incorporated, by
reference in the Prospectus, at the time filed with the Commission
conformed or will conform, in all material respects to the requirements
of the Securities Exchange Act of 1934 ("Exchange Act") or the
Securities Act, as applicable, and the rules and regulations of the
Commission thereunder. The Registration Statement and any amendment
thereto do not contain, and will not contain, any untrue statement of a
material fact and do not omit, and will not omit, to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading. The Prospectus and any amendments and
supplements thereto do not contain, and will not contain, any untrue
statement of a material fact; and do not omit, and will not 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 warranties as to information contained in or omitted
from the Registration Statement or the Prospectus, or any such
amendment or supplement, in reliance
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upon, and in conformity with, written information furnished to the
Company by or on behalf of any Underwriter through the Representatives,
specifically for use therein, it being understood and agreed that the
only such information is that described in Section 13 herein.
(vii) Each Issuer Free Writing Prospectus, as of its issue date
and at all subsequent times through the completion of the public offer
and sale of the Shares or until any earlier date that the Company
notified or notifies the Representatives as described in the next
sentence, did not, does not and will not include any information that
conflicted, conflicts or will conflict with the information contained
in the Registration Statement or the Prospectus, including any document
incorporated by reference and any prospectus supplement deemed to be a
part thereof that has not been superseded or modified.
(viii) The Company has not, directly or indirectly, distributed
and will not distribute any offering material in connection with the
offering and sale of the Shares other than any Preliminary Prospectus,
the Prospectus and other materials, if any, permitted under the
Securities Act and consistent with Section 4(ii) below. The Company
will file with the Commission all Issuer Free Writing Prospectuses in
the time and manner required under Rules 163(b)(2) and 433(d) under the
Securities Act.
(ix) (a) At the time of filing the Registration Statement, (b)
at the time of the most recent amendment thereto for the purposes of
complying with Section 10(a)(3) under the Securities Act (whether such
amendment was by post-effective amendment, incorporated report filed
pursuant to Section 13 or 15(d) of the Exchange Act or form of
prospectus), (c) at the time the Company or any person acting on its
behalf (within the meaning, for this clause only, of Rule 163(c) under
the Securities Act) made any offer relating to the Shares in reliance
on the exemption of Rule 163 under the Securities Act and (d) at the
date hereof, the Company is a "well-known seasoned issuer" as defined
in Rule 405 under the Securities Act.
(x) (a) At the earliest time after the filing the
Registration Statement that the Company or another offering participant
made a bona fide offer (within the meaning of Rule 164(h)(2) under the
Securities Act) of the Shares and (b) as of the date hereof (with such
date being used as the determination date for purposes of this
clause(b)), the Company was not and is not an "ineligible issuer" (as
defined in Rule 405 under the Securities Act, without taking into
account any determination by the Commission pursuant to Rule 405 under
the Securities Act that it is not necessary that the Company be
considered an ineligible issuer), including, without limitation, for
purposes of Rules 164 and 433 under the Securities Act with respect to
the offering of the Shares as contemplated by the Registration
Statement.
(xi) The financial statements of the Company, together with
related notes and schedules, as set forth or incorporated by reference
in the Registration Statement, the General Disclosure Package and the
Prospectus, present fairly the financial position and the results of
operations of the Company and its Subsidiaries at the indicated dates
and for the indicated periods. Such financial statements and the
related notes and schedules have been prepared in accordance with
generally accepted accounting principles, consistently applied
throughout the periods involved, and all adjustments necessary for a
fair presentation of results for such periods have been made. The
summary financial and statistical data included or incorporated by
reference in the Registration Statement, the General Disclosure Package
and the Prospectus present fairly the information shown therein and, to
the extent based upon or derived from the financial statements, have
been compiled on a basis consistent with the financial statements
presented therein. All disclosures contained in the Registration
Statement, the General Disclosure Package and the Prospectus, including
the documents incorporated by reference therein,
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regarding "non-GAAP financial measures" (as such term is defined by the
Rules and Regulations) comply with Regulation G of the Exchange Act and
Item 10 of Regulation S-K under the Securities Act, to the extent
applicable.
(xii) There is no action or proceeding pending or, to the
knowledge of the Company, threatened (a) against the Company or its
Subsidiaries or (b) involving any property of the Company or its
Subsidiaries before any court or administrative agency which, if
determined adversely to the Company or its Subsidiaries, might
reasonably be expected to result in any Material Adverse Effect, except
as set forth in the Registration Statement, the General Disclosure
Package and the Prospectus.
(xiii) The Company, together with its Subsidiaries, has good and
marketable title to all of the properties and assets reflected in the
financial statements hereinabove described (or as described in the
Registration Statement, the General Disclosure Package and the
Prospectus as owned by it), subject to no lien, mortgage, pledge,
charge or encumbrance of any kind except those reflected in such
financial statements (or as described in the Registration Statement,
the General Disclosure Package and the Prospectus) or which are not
material in amount or which do not interfere with the use made or
proposed to be made of the property. The leases, agreements to purchase
and mortgages to which the Company or any of its Subsidiaries is a
party, and the guaranties of third parties (a) are the legal, valid and
binding obligations of the Company, its Subsidiaries and, to the
knowledge of the Company, of all other parties thereto, and the Company
knows of no default or defenses currently existing with respect thereto
which might reasonably be expected to result in any Material Adverse
Effect, and (b) conform to the descriptions thereof set forth in the
Registration Statement, the General Disclosure Package and the
Prospectus. Each mortgage which the Company or any of its Subsidiaries
holds on the properties described in the Registration Statement, the
General Disclosure Package and the Prospectus constitutes a valid
mortgage lien for the benefit of the Company or its Subsidiary, as the
case may be, on such property.
(xiv) The Company has filed all Federal, state and foreign
income tax returns which have been required to be filed and has paid
all taxes indicated by said returns and all assessments received by it
to the extent that such taxes have become due and are not being
contested in good faith. All tax liabilities have been adequately
provided for in the financial statements of the Company.
(xv) Since the respective dates as of which information is
given in the Registration Statement, the General Disclosure Package and
the Prospectus, as each may be amended or supplemented, there has not
been any material adverse change or any development involving a
prospective material adverse change in or affecting the condition,
financial or otherwise, of the Company or the earnings, capital stock
(except that Common Stock of the Company has increased due to option
exercises, the Company's dividend reinvestment program and conversions
of preferred stock), business affairs, management, or business
prospects of the Company, whether or not occurring in the ordinary
course of business, and the Company has not incurred any material
liabilities or obligations and there has not been any material
transaction entered into by the Company, other than transactions in the
ordinary course of business and transactions described in the
Registration Statement, the General Disclosure Package and the
Prospectus, as each may be amended or supplemented. The Company has no
material contingent obligations which are not disclosed in the
Registration Statement, the General Disclosure Package and the
Prospectus.
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(xvi) The Company is not in violation of its charter or
by-laws. No Subsidiary is in violation of its charter or by-laws, which
violation will have, or after any required notice and passage of any
applicable grace period would have, a Material Adverse Effect. Neither
the Company nor any of its Subsidiaries are (a) in default under any
agreement, lease, contract, indenture or other instrument or obligation
to which it is a party or by which it or any of its properties is
bound, (b) in violation of any statute, or (c) in violation of any
order, rule or regulation applicable to the Company, its Subsidiaries
or its properties, of any court or of any regulatory body,
administrative agency or other governmental body, any of which defaults
or violations described in clauses (a) through (c) will have, or after
any required notice and passage of any applicable grace period would
have, a Material Adverse Effect. The issue and sale of the Shares and
the performance by the Company of all of its obligations under this
Agreement and the consummation of the transactions herein contemplated
and the fulfillment of the terms hereof will not conflict with or
constitute a violation of any statute or conflict with or result in a
breach of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust or other agreement or
instrument to which the Company, or any of its Subsidiaries, is a party
or by which it or any of its properties may be bound, or a violation of
its charter or by-laws or any order, rule or regulation applicable to
the Company, its Subsidiaries or its properties of any court or of any
regulatory body, administrative agency or other governmental body.
(xvii) Each approval, consent, order, authorization,
designation, declaration or filing by or with any regulatory,
administrative or other governmental body necessary in connection with
the execution and delivery by the Company of this Agreement and the
consummation of the transactions herein contemplated (except such
additional steps as may be required by the Commission, the National
Association of Securities Dealers, Inc. (the "NASD") or may be
necessary to qualify the Shares for public offering by the Underwriters
under state securities or Blue Sky laws) has been obtained or made by
the Company, and is in full force and effect.
(xviii) The Company and its Subsidiaries hold all material
licenses, certificates and permits from governmental authorities which
are necessary to the conduct of their businesses and neither the
Company nor any of its Subsidiaries have received any notice of
infringement or of conflict with asserted rights of others with respect
to any patents, patent rights, trade names, trademarks or copyrights,
which infringement is material to the business of the Company and its
Subsidiaries.
(xix) The Company qualifies as a real estate investment trust
pursuant to Sections 856 through 860 of the Internal Revenue Code of
1986, as amended, has so qualified for the taxable years ended December
31, 1984 through December 31, 2005 and no transaction or other event
has occurred or is contemplated which would prevent the Company from so
qualifying for its current taxable year.
(xx) To the best of the Company's knowledge, Ernst & Young
LLP, who have certified certain of the financial statements and related
schedules filed with the Commission as part of, or incorporated by
reference in, the Registration Statement, the General Disclosure
Package and the Prospectus, is an independent registered public
accounting firm with respect to the Company as required by the
Securities Act and the Rules and Regulations and the Public Company
Accounting Oversight Board (the "PCAOB").
(xxi) The Company and its Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance
that (a) transactions are executed in accordance with management's
general or specific authorization; (b) transactions are recorded as
necessary to permit preparation of financial statements in conformity
with generally accepted
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accounting principles and to maintain accountability for assets; (c)
access to assets is permitted only in accordance with management's
general or specific authorization; and (d) the recorded accountability
for assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(xxii) The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rules 13a-14 and
15d-14 under the Exchange Act); such disclosure controls and procedures
are designed to ensure that material information relating to the
Company, including its Subsidiaries, is made known to the Company's
Chief Executive Officer and its Chief Financial Officer by others
within those entities, and such disclosure controls and procedures are
effective to perform the functions for which they were established; the
Company's auditors and the Audit Committee of the Board of Directors of
the Company have been advised of: (a) any significant deficiencies in
the design or operation of internal controls which could adversely
affect the Company's ability to record, process, summarize, and report
financial data; and (b) any fraud, whether or not material, that
involves management or other employees who have a role in the Company's
internal controls; any material weaknesses in internal controls have
been identified for the Company's auditors; and since the date of the
most recent evaluation of such disclosure controls and procedures,
there have been no significant changes in internal controls or in other
factors that could significantly affect internal controls, including
any corrective actions with regard to significant deficiencies and
material weaknesses.
(xxiii) Since July 30, 2002, the Company has not, directly or
indirectly, including through any subsidiary: (a) extended credit,
arranged to extend credit, or renewed any extension of credit, in the
form of a personal loan, to or for any director or executive officer of
the Company, or to or for any family member or affiliate of any
director or executive officer of the Company; or (b) made any material
modification, including any renewal thereof, to any term of any
personal loan to any director or executive officer of the Company, or
any family member or affiliate of any director or executive officer,
which loan was outstanding on July 30, 2002.
(xxiv) To the knowledge of the Company, after inquiry of its
officers and directors, there are no affiliations with any NASD member
firm among the Company's officers, directors, or principal
stockholders, except as set forth in the Registration Statement, the
General Disclosure Package and the Prospectus, or as otherwise
disclosed in writing to the Underwriters.
(xxv) This Agreement has been duly authorized, executed and
delivered by the Company.
(xxvi) Neither the Company nor any of its officers or directors
has taken nor will any of them take, directly or indirectly, any action
resulting in a violation of Regulation M promulgated under the Exchange
Act, or designed to cause or result in, or which has constituted or
which reasonably might be expected to constitute, the stabilization or
manipulation of the price of the Company's Common Stock. The Company
acknowledges that the Underwriters may engage in transactions that
stabilize, maintain or otherwise affect the price of the Company's
Common Stock, including stabilizing bids, syndicate covering
transactions and the imposition of penalty bids.
(xxvii) The Shares have been approved for listing upon official
notice of issuance on the New York Stock Exchange.
(xxviii) The Company is not, and immediately after the sale of the
Shares pursuant to the terms and conditions of this Agreement will not
be, an "investment company" or a company
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"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940.
2. PURCHASE, SALE AND DELIVERY OF THE SHARES. On the basis of the
representations, warranties and covenants herein contained, and subject to the
conditions herein set forth, the Company agrees to sell to each Underwriter, and
each Underwriter, severally and not jointly, agrees to purchase from the
Company, at a price of $34.20 per Share, the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule I hereto (plus any additional
number of Shares which such Underwriter may become obligated to purchase
pursuant to the provisions of Section 11 hereof).
Payment for the Firm Shares to be sold hereunder is to be made
by Federal Funds wire transfer to an account designated by the Company for the
Firm Shares to be sold by the Company against delivery of the Firm Shares
therefor to the Representatives. Such payment and delivery are to be made at the
offices of Deutsche Bank Securities Inc., 60 Wall Street, 4th Floor, New York,
New York, at 10:00 a.m. New York time, on April 12, 2006 or at such other time
and date thereafter as the Representatives and the Company shall agree upon,
such time and date being herein referred to as the "Closing Date." (As used
herein, "business day" means a day on which the New York Stock Exchange is open
for trading and on which banks in New York are open for business and not
permitted by law or executive order to be closed). The Firm Shares will be
delivered by Mellon Investor Services LLC (the "Transfer Agent") in such
denominations and in such registrations as the Representatives request in
writing not later than the second full business day prior to the Closing Date,
and will be delivered through book entry facilities of The Depository Trust
Company ("DTC") and made available for inspection by the Representatives at
least one business day prior to the Closing Date at such place as the
Representatives, DTC and the Company shall agree.
In addition, on the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company hereby grants an option to the Underwriters to purchase
severally the Option Shares at the price per share as set forth in the first
paragraph of this Section 2. The option granted hereby may be exercised in whole
or in part by giving notice (i) at any time before the Closing Date and (ii)
only once thereafter within 30 days after the date of this Agreement, by the
Representatives to the Company setting forth the number of Option Shares as to
which the several Underwriters are exercising the option and the time and date
at which such Option Shares are to be delivered. The time and date at which the
Option Shares are to be delivered shall be determined by the Representatives but
shall not be earlier than three nor later than 10 full business days after the
exercise of such option, nor in any event prior to the Closing Date (such time
and date being herein referred to as the "Option Closing Date"). If the date of
exercise of the option is three or more days before the Closing Date, the notice
of exercise shall set the Closing Date as the Option Closing Date. The option
with respect to the Option Shares granted hereunder may be exercised only to
cover over-allotments in the sale of the Firm Shares by the Underwriters. The
Representatives may cancel such option at any time prior to its expiration by
giving written notice of such cancellation to the Company. To the extent, if
any, that the option is exercised, payment for the Option Shares shall be made
by Federal Funds wire transfer to an account designated by the Company for the
Option Shares to be sold by the Company against delivery of the Option Shares
through the facilities of DTC. Such payment and delivery are to be made at the
offices of Deutsche Bank Securities Inc., 60 Wall Street, 4th Floor, New York,
New York, at 10:00 a.m. New York time, on the Option Closing Date. To the
extent, if any, that the option is exercised, the Option Shares will be
delivered by the Transfer Agent in such denominations and in such registrations
as the Representatives request in writing not later than the second full
business day prior to the Option Closing Date, and will be delivered through
book entry facilities of DTC and made available for inspection by the
Representatives at least one business day prior to the Option Closing Date at
such place as the Representatives, DTC and the Company shall agree.
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3. OFFERING BY THE UNDERWRITERS. It is understood that the
several Underwriters are to make a public offering of the Shares as soon as the
Representatives deem it advisable to do so. The Shares are to be initially
offered to the public at the price and upon the terms set forth in the
Prospectus. The Representatives may from time to time thereafter change the
public offering price and other selling terms.
4. COVENANTS OF THE COMPANY. The Company covenants and agrees
with the Underwriters that:
(i) The Company will (a) prepare and timely file with the
Commission under Rule 424(b) (without reliance on Rule 424(b)(8)) under
the Securities Act a Prospectus in a form approved by the
Representatives containing information previously omitted at the time
of effectiveness of the Registration Statement in reliance on Rules
430A, 430B or 430C under the Securities Act, (b) not file any amendment
to the Registration Statement or distribute an amendment or supplement
to the General Disclosure Package or the Prospectus or document
incorporated by reference therein of which the Representatives shall
not previously have been advised and furnished with a copy or to which
the Representatives shall have reasonably objected in writing or which
is not in compliance with the Rules and Regulations for so long as the
Representatives may deem necessary to in order to complete the
distribution of the Shares and (c) file on a timely basis all reports
and any definitive proxy or information statements required to be filed
by the Company with the Commission subsequent to the date of the
Prospectus and prior to the termination of the offering of the Shares
by the Underwriters; provided, however, that for each such report or
preliminary or definitive proxy or information statement, the Company
will not file any such report or preliminary or definitive proxy or
information statement, or amendment thereto, of which the
Representatives shall not previously have been advised and furnished
with a copy or to which the Representatives shall have reasonably
objected in writing or which is not in compliance with the Exchange
Act.
(ii) The Company will (a) not make any offer relating to the
Shares that would constitute an Issuer Free Writing Prospectus or that
would otherwise constitute a "free writing prospectus" (as defined in
Rule 405 under the Securities Act) required to be filed by the Company
with the Commission under Rule 433 under the Securities Act unless the
Representatives approve its use in writing prior to first use (each, a
"Permitted Free Writing Prospectus"); provided that the prior written
consent of the Representatives hereto shall be deemed to have been
given in respect of the Issuer Free Writing Prospectus(es) included in
Schedule III hereto, (b) treat each Permitted Free Writing Prospectus
as an Issuer Free Writing Prospectus, (c) comply with the requirements
of Rules 163, 164 and 433 under the Securities Act applicable to any
Issuer Free Writing Prospectus, including the requirements relating to
timely filing with the Commission, legending and record keeping and (d)
not take any action that would result in an Underwriter or the Company
being required to file with the Commission pursuant to Rule 433(d)
under the Securities Act a free writing prospectus prepared by or on
behalf of such Underwriter that such Underwriter otherwise would not
have been required to file thereunder.
(iii) If so requested by the Representatives, the Company will
prepare a final term sheet (the "Final Term Sheet") reflecting the
final terms of the Shares, in form and substance satisfactory to the
Representatives, and shall file such Final Term Sheet as an Issuer Free
Writing Prospectus pursuant to Rule 433 under the Securities Act prior
to the close of business two business days after the date hereof;
provided that the Company shall provide the Representatives with copies
of any such Final Term Sheet a reasonable amount of time prior to such
proposed filing and will not use or file any such document to which the
Representatives or counsel to the Underwriters shall reasonably object.
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(iv) The Company will advise the Representatives promptly (a)
when any post-effective amendment to the Registration Statement or new
registration statement relating to the Shares shall have become
effective, or any supplement to the Prospectus shall have been filed,
(b) of the receipt of any comments from the Commission, (c) of any
request of the Commission for amendment of the Registration Statement
or the filing of a new registration statement or any amendment or
supplement to the General Disclosure Package or the Prospectus or any
document incorporated by reference therein or otherwise deemed to be a
part thereof or for any additional information, and (d) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or such new registration statement or any order
preventing or suspending the use of any Preliminary Prospectus, any
Issuer Free Writing Prospectus or the Prospectus, or of the institution
of any proceedings for that purpose for so long as the Representatives
may deem necessary in order to complete the distribution of the Shares,
or of the suspension of the qualification of the Shares for offering or
sale in any jurisdiction, and the Company will use its best efforts to
prevent (x) the issuance of any such stop order suspending the
effectiveness of the Registration Statement or such new registration
statement or any order preventing or suspending the use of any
Preliminary Prospectus, any Issuer Free Writing Prospectus or the
Prospectus, or (y) any such suspension of the qualification of the
Shares for offering or sale in any jurisdiction, and to obtain as soon
as possible the lifting of any such order, if issued, or such
suspension of qualification.
(v) If immediately prior to the third anniversary (the
"Renewal Deadline") of the initial effective date of the Registration
Statement, any of the Shares remain unsold by the Underwriters, the
Company will, prior to the Renewal Deadline file, if it has not already
done so and is eligible to do so, a new automatic shelf registration
statement relating to the Shares, in a form satisfactory to the
Representatives. If the Company is not eligible to file an automatic
shelf registration statement, the Company will, prior to the Renewal
Deadline, if it has not already done so, file a new shelf registration
statement relating to the Shares, in a form satisfactory to the
Representatives, and will use its best efforts to cause such
registration statement to be declared effective within 180 days after
the Renewal Deadline. The Company will take all other action necessary
or appropriate to permit the public offering and sale of the Shares to
continue as contemplated in the expired registration statement.
References herein to the Registration Statement shall include such new
automatic shelf registration statement or such new shelf registration
statement, as the case may be.
(vi) The Company will deliver to, or upon the order of, the
Representatives, from time to time, as many copies of any Preliminary
Prospectus or any Issuer Free Writing Prospectus as the Representatives
may reasonably request. The Company will deliver to, or upon the order
of, the Representatives during the period when delivery of a Prospectus
(or, in lieu thereof, the notice referred to under Rule 173(a) under
the Securities Act) is required under the Securities Act, as many
copies of the Prospectus in final form, or as thereafter amended or
supplemented, as the Representatives may reasonably request. The
Company will deliver to the Representatives at or before the Closing
Date, one signed copy of the Registration Statement and all amendments
thereto including all exhibits filed therewith, and will deliver to the
Representatives such number of copies of the Registration Statement,
including documents incorporated by reference therein, but without
exhibits, and of all amendments thereto, as the Representatives may
reasonably request.
(vii) The Company will comply with the Securities Act and the
Rules and Regulations and the Exchange Act, and the rules and
regulations of the Commission thereunder, so as to permit the
completion of the distribution of the Shares as contemplated in this
Agreement and the
10
Prospectus. Subject to the provisions of Section 4(i) above, if during
the period in which a prospectus (or, in lieu thereof, the notice
referred to under Rule 173(a) under the Securities Act) is required by
law to be delivered by an Underwriter or a dealer any event shall occur
as a result of which, in the judgment of the Company or in the opinion
of counsel for the Underwriters, it becomes necessary to amend or
supplement the Prospectus in order to make the statements therein, in
the light of the circumstances existing at the time the Prospectus is
delivered to a purchaser, not misleading, or, if it is necessary at any
time to amend or supplement the Prospectus to comply with any law, the
Company promptly will either (a) prepare and file with the Commission
an appropriate amendment to the Registration Statement or supplement to
the Prospectus or (b) prepare and file with the Commission an
appropriate filing under the Exchange Act which shall be incorporated
by reference in the Prospectus so that the Prospectus as so amended or
supplemented will not, in the light of the circumstances when it is so
delivered, be misleading, or so that the Prospectus will comply with
law.
(viii) If the General Disclosure Package is being used to
solicit offers to buy the Shares at a time when the Prospectus is not
yet available to prospective purchasers and any event shall occur as a
result of which, in the judgment of the Company or in the reasonable
opinion of the Underwriters, it becomes necessary to amend or
supplement the General Disclosure Package in order to make the
statements therein, in the light of the circumstances, not misleading,
or to make the statements therein not conflict with the information
contained in the Registration Statement then on file, or if it is
necessary at any time to amend or supplement the General Disclosure
Package to comply with any law, the Company promptly will either (a)
prepare, file with the Commission (if required) and furnish to the
Underwriters and any dealers an appropriate amendment or supplement to
the General Disclosure Package or (b) prepare and file with the
Commission an appropriate filing under the Exchange Act which shall be
incorporated by reference in the General Disclosure Package so that the
General Disclosure Package as so amended or supplemented will not, in
the light of the circumstances, be misleading or conflict with the
Registration Statement then on file, or so that the General Disclosure
Package will comply with law.
(ix) The Company will make generally available to its security
holders, as soon as it is practicable to do so, but in any event not
later than 15 months after the effective date of the Registration
Statement (as defined in Rule 158(c) under the Securities Act), an
earnings statement (which need not be audited) in reasonable detail,
covering a period of twelve consecutive months beginning after the
effective date of the Registration Statement, which earnings statement
shall satisfy the requirements of Section 11(a) of the Securities Act
and Rule 158 under the Securities Act.
(x) The Company will, for a period of five years from the
Closing Date, deliver to the Representatives copies of annual reports
and copies of all other documents, reports and information furnished by
the Company to its stockholders or filed with any securities exchange
pursuant to the requirements of such exchange or with the Commission
pursuant to the Securities Act or the Exchange Act. The Company will
deliver to the Representatives similar reports with respect to
significant subsidiaries, as that term is defined in the Rules and
Regulations, which are not consolidated in the Company's financial
statements.
(xi) The Company will use the net proceeds from the sale of
the Shares pursuant to this Agreement in the manner specified under the
heading "Use of Proceeds" in the Prospectus.
(xii) No offering, sale or other disposition of any Common
Stock of the Company will be made for a period of 90 days after the
date of this Agreement, directly or indirectly, by the Company
otherwise than hereunder or with the prior written consent of Deutsche
Bank Securities
11
Inc., except that the Company may, without such consent, (a) issue
securities under the Company's equity compensation plans for officers,
employees, and non-employee directors described in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2005; (b)
issue shares upon the exercise of options or other stock rights issued
pursuant to the Company's equity compensation plans for officers,
employees, and non-employee directors described in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2005; (c)
sell shares of Common Stock pursuant to the Amended and Restated
Dividend Reinvestment and Stock Purchase Plan filed with the Commission
on December 11, 2003; or (d) issue shares of Common Stock upon
conversion of any shares of 6% Series E Cumulative Convertible and
Redeemable Preferred Stock outstanding as of the date hereof.
5. COSTS AND EXPENSES. The Company will pay all costs, expenses
and fees incident to the performance of its obligations under this Agreement,
including, without limiting the generality of the foregoing, the following: the
fees incident to the issuance and delivery of the Shares; accounting fees of the
Company; the fees and disbursements of counsel for the Company; the cost of
printing and delivering to, or as requested by, the Underwriters, copies of the
Registration Statement, the Preliminary Prospectuses, the Issuer Free Writing
Prospectuses, the Prospectus, this Agreement, the applicable listing agreement
for the New York Stock Exchange; the filing fees of the Commission; the filing
fees and expenses (including legal fees and disbursements) incident to securing
any required review by the NASD of the terms of the sale of the Shares; the fees
incident to the listing agreement for the New York Stock Exchange. Any transfer
taxes imposed on the sale of the Shares to the several Underwriters will be paid
by the Company. The Company shall not, however, be required to pay for any of
the Underwriters' expenses except that, if this Agreement shall not be
consummated because the conditions in Section 7 hereof are not satisfied, or
because this Agreement is terminated by the Representatives pursuant to Section
6 hereof, or this Agreement is terminated pursuant to Section 10(i)(a) hereof,
or by reason of any failure, refusal or inability on the part of the Company to
perform any undertaking or satisfy any condition of this Agreement or to comply
with any of the terms hereof on its part to be performed, unless such failure to
satisfy said condition or to comply with said terms be due to the default or
omission of any Underwriter, then the Company shall reimburse the several
Underwriters for reasonable out-of-pocket expenses, including fees and
disbursements of counsel, reasonably incurred in connection with investigating,
marketing and proposing to market the Shares or in contemplation of performing
their obligations hereunder, but the Company shall not in any event be liable to
any of the several Underwriters for damages on account of loss of anticipated
profits from the sale by any of them of the Shares.
6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS. The several
obligations of the Underwriters to purchase the Firm Shares on the Closing Date
and the Option Shares, if any, on the Option Closing Date are subject to the
accuracy, as of the Closing Date or the Option Closing Date, as the case may be,
of the representations and warranties of the Company contained herein, and to
the performance by the Company of its covenants and obligations hereunder and to
the following additional conditions:
(i) No stop order suspending the effectiveness of the
Registration Statement, as amended from time to time, shall have been
issued and no proceedings for that purpose shall have been taken or, to
the knowledge of the Company, shall be contemplated or threatened by
the Commission. The Prospectus and each Issuer Free Writing Prospectus
required shall have been filed as required by Rules 424, 430A, 430B,
430C or 433 under the Securities Act, as applicable, within the time
period prescribed by, and in compliance with, the Rules and
Regulations, and any request by the Commission for additional
information (to be included in the Registration Statement or otherwise)
shall have been disclosed to the Representatives and complied with to
their reasonable satisfaction.
12
(ii) The Representatives shall have received on the Closing
Date and the Option Closing Date, if any, the opinion of Shumaker, Loop
& Kendrick, LLP, counsel for the Company, dated the Closing Date or the
Option Closing Date, as the case may be, and addressed to the
Representatives, as representatives of the several Underwriters, to the
effect that:
(a) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the State of Delaware, with corporate power and authority to
own its properties and conduct its business as described in
the Registration Statement, the General Disclosure Package and
the Prospectus.
(b) The Company is duly qualified to transact business in
all jurisdictions in which the conduct of its business
requires such qualification, and in which the failure to
qualify would have a Material Adverse Effect.
(c) The information contained in the section captioned
"Capitalization" in the Registration Statement and the
Prospectus (and any similar section or information contained
in the General Disclosure Package) sets forth the authorized,
issued and outstanding capital stock of the Company at the
indicated date; the authorized shares of its Common Stock have
been duly authorized; the outstanding shares of its Common
Stock have been duly authorized and validly issued and are
fully paid and nonassessable; the certificates for the Shares
are in due and proper form; the shares of Common Stock,
including Option Shares, if any, to be sold by the Company
pursuant to this Agreement have been duly authorized and will
be validly issued, fully paid and non-assessable when issued
and paid for as contemplated by this Agreement; and no
preemptive or similar rights of stockholders exist with
respect to any of the Shares or the issue and sale thereof.
(d) The Registration Statement has become effective under
the Securities Act and, to such counsel's knowledge no stop
order proceedings with respect thereto have been instituted or
are pending or threatened under the Securities Act.
(e) The Registration Statement, the Prospectus and each
amendment or supplement thereto and documents incorporated by
reference therein comply as to form in all material respects
with the requirements of the Securities Act or the Exchange
Act, as applicable, and the applicable rules and regulations
thereunder (except that such counsel need express no opinion
as to the financial statements, schedules and other financial
or statistical information included or incorporated by
reference therein).
(f) The statements under the caption "Description of Our
Common Stock" in the General Disclosure Package and the
Prospectus, insofar as such statements constitute a summary of
documents referred to therein or matters of law, are accurate
summaries and fairly and correctly present in all material
respects the information called for with respect to such
documents and matters.
(g) The statements under the caption "Certain Government
Regulations" in the Company's Annual Report on Form 10-K, and
any amendments thereto, for the fiscal year ended December 31,
2005 as to matters of law stated therein, have been reviewed
by such counsel and constitute fair summaries of the matters
described therein which are material to the business or
condition (financial or otherwise) of the Company.
(h) Such counsel does not know of any contracts or
documents required to be filed as exhibits to or incorporated
by reference in the Registration Statement or
13
described in the Registration Statement or the Prospectus or
any amendment or supplement thereto which are not so filed,
incorporated by reference or described as required, and such
contracts and documents as are summarized in the Registration
Statement or the Prospectus or any amendment or supplement
thereto are fairly summarized in all material respects.
(i) Such counsel knows of no material legal proceedings
pending or threatened against the Company, except as set forth
in the Registration Statement, the General Disclosure Package
and the Prospectus.
(j) The execution and delivery of this Agreement and the
consummation of the transactions herein contemplated,
including the issuance and sale of the Shares and the
performance by the Company of its obligations under this
Agreement, do not and will not conflict with or constitute a
violation of any statute or conflict with or result in a
breach of any of the terms or provisions of, or constitute a
default under, the charter or by-laws of the Company, any
material agreement or instrument known to such counsel to
which the Company is a party or by which the Company or the
Company's properties may be bound or any order known to such
counsel or rule or regulation applicable to the Company or the
Company's properties of any court or governmental agency or
body.
(k) This Agreement has been duly authorized, executed and
delivered by the Company.
(l) The Shares conform in all material respects to the
descriptions thereof contained in the Registration Statement,
the General Disclosure Package and the Prospectus.
(m) No approval, consent, order, authorization,
designation, declaration or filing by or with any regulatory,
administrative or other governmental body is necessary in
connection with the execution and delivery of this Agreement
and the consummation of the transactions herein contemplated
(other than as may be required by the Commission or the NASD
or as required by state securities and Blue Sky laws as to
which such counsel need express no opinion) except such as
have been obtained or made by the Company, specifying the
same.
(n) The Company is not an "investment company" or a
company "controlled" by an "investment company" within the
meaning of the Investment Company Act of 1940.
(o) Any required filing of each Issuer Free Writing
Prospectus pursuant to Rule 433 under the Securities Act has
been made within the time period required by Rule 433(d) under
the Securities Act.
In addition, either such counsel or Arnold & Porter LLP,
special tax counsel to the Company, will provide an opinion, based on
such counsel's own review of the Company's certificate of
incorporation, stating that the Company was organized and continues to
be organized in conformity with the requirements for qualification as a
real estate investment trust under subchapter M of the Internal Revenue
Code of 1986, as amended (the "Code"), and, based on such counsel's
review of the Company's federal income tax returns and discussions with
management and independent public accountants for the Company, that the
Company, taking into account operations for its taxable and fiscal
years ended December 31, 2000 through
14
December 31, 2005, satisfied the requirements for qualification and
taxation as a real estate investment trust under the Code for such
years and that its proposed method of operation will enable it to meet
the requirements for qualification and taxation as a real estate
investment trust under the Code for its taxable and fiscal year ending
December 31, 2006. Furthermore, such counsel shall opine that the
statements contained under the heading "U.S. Federal Income Tax
Considerations" in the Registration Statement, the General Disclosure
Package and the Prospectus and under the heading "Taxation" in the
Company's Annual Report on Form 10-K, and any amendment, for the fiscal
year ended December 31, 2005 (and any similar sections or information
contained in the General Disclosure Package) are correct and accurate
in all material respects and present fairly and accurately the material
aspects of the federal income tax treatment of the Company and of its
stockholders.
In rendering such opinion, such counsel may rely as to matters
governed by the laws of states other than the laws of the State of
Ohio, the corporate laws of the State of Delaware or Federal laws on
local counsel in such jurisdictions, provided that in such case such
counsel shall state that they believe that they and the Underwriters
are justified in relying on such other counsel and such other counsel
shall indicate that the Underwriters may rely on such opinion. As to
matters of fact, to the extent they deem proper, such counsel may rely
on certificates of officers of the Company and public officials so long
as such counsel states that they have no reason to believe that either
the Underwriters or they are not justified in relying on such
certificates. In addition to the matters set forth above, the opinion
of Shumaker, Loop & Kendrick, LLP shall also include a statement to the
effect that nothing has come to the attention of such counsel which
leads them to believe that (a) the Registration Statement, as of the
time of its effectiveness for purposes of Section 11 of the Securities
Act and as of the Applicable Time, contained or contains an untrue
statement of a material fact or omitted or omits to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading, (b) the General Disclosure Package, as of the
Applicable Time, contained an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading and (c) the Prospectus, or any supplement
thereto, on the date it was filed pursuant to the Rules and Regulations
and as of the Closing Date or the Option Closing Date, as the case may
be, contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading (except that such counsel need express
no view as to financial statements, schedules and other financial
information included therein). With respect to such statement,
Shumaker, Loop & Kendrick, LLP may state that this statement is based
upon the procedures set forth or incorporated by reference therein, but
is without independent check and verification.
(iii) The Representatives shall have received from Calfee,
Halter & Griswold LLP, counsel for the Underwriters, on the Closing
Date and the Option Closing Date, if any, an opinion dated the Closing
Date or the Option Closing Date, as the case may be, with respect to
the organization of the Company, the validity of the Shares, the
Registration Statement, the General Disclosure Package and the
Prospectus, and other related matters as the Representatives reasonably
may request and such counsel shall have received such papers and
information as they reasonably request to enable them to pass upon such
matters.
(iv) At the time of execution of this Agreement, the
Representatives shall have received from Ernst & Young LLP a signed
letter, in form and substance satisfactory to the Representatives,
dated the date hereof (a) confirming that they are an independent
registered public accounting firm with respect to the Company and its
Subsidiaries within the meaning of the Securities Act, the Rules and
Regulations and the PCAOB and are in compliance with the
15
applicable requirements relating to the qualification of accountants
under Rule 2-01 of Regulation S-X of the Commission and (b) stating the
conclusions and findings of such firm with respect to the financial
information examined by them and included or incorporated by reference
in the Registration Statement and the General Disclosure Package and
containing such other statements and information as is ordinarily
included in accountants' "comfort letters" to underwriters in
connection with registered public offerings.
(v) With respect to the letter of Ernst & Young LLP referred
to in the preceding paragraph and delivered to the Representatives
concurrently with the execution of this Agreement (the "initial
letter"), the Company shall have furnished to the Representatives a
letter, in form and substance satisfactory to the Representatives (the
"bring-down letter"), of such accountants, dated the Closing Date and
the Option Closing Date, if any, (a) confirming that they are an
independent registered public accounting firm with respect to the
Company and its Subsidiaries within the meaning of the Securities Act,
the Rules and Regulations and the PCAOB and are in compliance with the
applicable requirements relating to the qualification of accountants
under Rule 2-01 of Regulation S-X of the Commission, (b) stating the
conclusions and findings of such firm with respect to the financial
information and other matters covered by the initial letter and the
financial information examined by them and included in the Prospectus
and (c) confirming in all material respects the conclusions and
findings set forth in the initial letter.
(vi) The Representatives shall have received on the Closing
Date and the Option Closing Date, if any, a certificate or certificates
of the Chairman of the Board and Chief Executive Officer and the Senior
Vice President and Chief Financial Officer of the Company to the effect
that on and as of the Closing Date or the Option Closing Date, as the
case may be, each of them severally represents as follows:
(a) The Registration Statement has become effective under
the Securities Act and no stop order suspending the
effectiveness of the Registration Statement or no order
preventing or suspending the use of any Preliminary
Prospectus, any Issuer Free Writing Prospectus or the
Prospectus has been issued, and no proceedings for such
purpose have been taken or are, to his knowledge, contemplated
by the Commission.
(b) He does not know of any litigation instituted or
threatened against the Company of a character required to be
disclosed in the Registration Statement, the General
Disclosure Package and the Prospectus which is not so
disclosed therein or in a document incorporated by reference
therein; he does not know of any material contract required to
be filed as an exhibit to the Registration Statement which is
not so filed therein or in a document incorporated by
reference therein.
(c) He has carefully examined the General Disclosure
Package and any individual Limited Use Free Writing Prospectus
and, in his opinion, as of the Applicable Time, the statements
contained in the General Disclosure Package and any individual
Limited Use Free Writing Prospectus did not contain any untrue
statement of a material fact, and such General Disclosure
Package and any individual Limited Use Free Writing
Prospectus, when considered together with the General
Disclosure Package, did not 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.
(d) He has carefully examined the Registration Statement
and the Prospectus and in his opinion, as of the effective
date of the Registration Statement, the statements contained
in the Registration Statement, including any document
incorporated by
16
reference therein, were true and correct, and such
Registration Statement and Prospectus, or any document
incorporated by reference therein, did not omit to state a
material fact required to be stated therein or necessary in
order to make the statements therein not misleading and, in
his opinion, since the effective date of the Registration
Statement, no event has occurred which should have been set
forth in a supplement to or an amendment of the Prospectus
which has not been so set forth in such supplement or
amendment.
(e) The representations and warranties of the Company as
set forth in this Agreement are true and correct as of the
Closing Date or the Option Closing Date, as the case may be,
as if made on such date. The Company has performed all of its
obligations under this Agreement as are to be performed at or
before the Closing Date or the Option Closing Date, as the
case may be. The representations and warranties made in this
clause (e) shall be deemed made by the Company.
(vii) The Representatives shall have received at or prior to
the Closing Date, an agreement, in form and substance satisfactory to
the Representatives, signed by the directors and executive officers of
the Company to the effect that they will not, prior to the expiration
of 90 days from the date of this Agreement, offer, sell or otherwise
dispose of any shares of Common Stock of the Company or any securities
that the directors and executive officers have, or will have, the right
to acquire through the exercise of options, warrants, subscription or
other rights, without the prior written consent of Deutsche Bank
Securities Inc., except (a) pursuant to bona fide gifts, provided that
the Company shall have delivered to Deutsche Bank Securities Inc.
written consent to such gift, but in no event shall the gifts under
this subsection (a) of the executive officers and directors exceed
75,000 shares of Common Stock in the aggregate, (b) pursuant to routine
dispositions under Rule 10b5-1 Sales Plans entered into by certain
directors and officers of the Company as of or prior to the date hereof
(or, in the case of the Chairman of the Board and Chief Executive
Officer of the Company, a Rule 10b5-1 Sales Plan entered into prior to
expiration of 90 days from the date of this Agreement), and (c) shares
obtained pursuant to the Company's equity compensation plans for
officers, employees, and non-employee directors, provided that the
Company shall have delivered to Deutsche Bank Securities Inc. written
consent to such sale, but in no event shall the sales under this
subsection (c) of the executive officers and directors exceed 300,000
shares of Common Stock in the aggregate.
(viii) The Shares to be sold by the Company as of the Closing
Date or the Option Closing Date, as the case may be, shall have been
duly listed, subject to notice of issuance, on the New York Stock
Exchange.
The opinions and certificates mentioned in this Agreement
shall be deemed to be in compliance with the provisions hereof only if they are
in all material respects reasonably satisfactory to the Representatives and to
Calfee, Halter & Griswold LLP, counsel for the Underwriters.
If any of the conditions hereinabove provided for in this
Section 6 shall not have been fulfilled when and as required by this Agreement
to be fulfilled, the obligations of the Underwriters hereunder may be terminated
by the Representatives by notifying the Company of such termination in writing
or by telecopy at or prior to the Closing Date. In such event, the Company and
the Underwriters shall not be under any obligation to each other (except to the
extent provided in Sections 5 and 8 hereof).
7. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY. The obligations
of the Company to sell and deliver the portion of the Shares required to be
delivered as and when specified in this Agreement are subject to the conditions
that at the Closing Date or the Option Closing Date, as the case may be, no stop
17
order suspending the effectiveness of the Registration Statement shall have been
issued and in effect or proceedings therefor initiated or threatened.
8. INDEMNIFICATION.
(i) The Company agrees to indemnify and hold harmless each
Underwriter, its officers and directors, and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act against any losses,
claims, damages or liabilities to which such Underwriter or such
controlling person may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of or are based
upon (a) any untrue statement or alleged untrue statement of any
material fact contained or incorporated by reference in the
Registration Statement, any Preliminary Prospectus, any Issuer Free
Writing Prospectus, the Prospectus or any amendment or supplement
thereto, (b) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading in the case of the Registration
Statement or any amendment thereto, or in the case of any Preliminary
Prospectus, any Issuer Free Writing Prospectus or the Prospectus or any
amendment or supplement thereto, in light of the circumstances under
which they were made, or (c) any act or failure to act, or any alleged
act or failure to act by any Underwriter in connection with, or
relating in any manner to, the Shares or the offering contemplated
hereby, and will reimburse each such Underwriter and each such
controlling person for any legal or other expenses reasonably incurred
by such Underwriter or such controlling person in connection with
investigating or defending any such loss, claim, damage, liability,
action or proceeding; provided, however, that the Company will not be
liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or
alleged untrue statement, or omission or alleged omission made or
incorporated by reference in the Registration Statement, any
Preliminary Prospectus, any Issuer Free Writing Prospectus or the
Prospectus, or such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by or
through the Representatives specifically for use in the preparation
thereof. This indemnity agreement will be in addition to any liability
which the Company may otherwise have.
(ii) Each Underwriter, severally and not jointly, will
indemnify and hold harmless the Company, each of its directors, each of
its officers who have signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act, against any
losses, claims, damages or liabilities to which the Company or any such
director, officer or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of
any material fact contained or incorporated by reference in the
Registration Statement, any Preliminary Prospectus, any Issuer Free
Writing Prospectus or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading in the case
of the Registration Statement or any amendment thereto, or in the case
of any Preliminary Prospectus, any Issuer Free Writing Prospectus or
the Prospectus, or any amendment or supplement thereto, in the light of
the circumstances under which they were made; and will reimburse any
legal or other expenses reasonably incurred by the Company or any such
director, officer or controlling person in connection with
investigating or defending any such loss, claim, damage, liability,
action or proceeding; provided, however, that each Underwriter will be
liable in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged
18
omission has been made or incorporated by reference in the Registration
Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus or the Prospectus, or such amendment or supplement, in
reliance upon and in conformity with written information furnished to
the Company by or through the Representatives specifically for use in
the preparation thereof. This indemnity agreement will be in addition
to any liability which such Underwriter may otherwise have.
(iii) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to this Section 8, such person
(the "indemnified party") shall promptly notify the person against whom
such indemnity may be sought (the "indemnifying party") in writing;
provided that the failure to so notify will not relieve the
indemnifying party from any liability that the indemnifying party may
have on account of the provisions of Sections 8(i) or (ii) or
otherwise, except to the extent that the indemnifying party shall not
have otherwise learned of such proceeding and such failure is
materially prejudicial to the indemnifying party. In case any such
proceeding shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate therein and, to the
extent that it shall wish jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party and shall pay as incurred the
fees and disbursements of such counsel related to such proceeding. In
any such proceeding, any indemnified party shall have the right to
retain its own counsel at its own expense. Notwithstanding the
foregoing, the indemnifying party shall pay as incurred the fees and
expenses of the counsel retained by the indemnified party in the event
(a) the indemnifying party and the indemnified party shall have
mutually agreed to the retention of such counsel or (b) the named
parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and
representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between
them, in which case the indemnifying party shall not be entitled to
assume the defense of such suit notwithstanding its obligation to bear
the fees and expenses of such counsel. It is understood that the
indemnifying party shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the
reasonable fees and expenses of more than one separate firm for all
such indemnified parties and one local counsel. Such firm shall be
designated in writing by the Representatives in the case of parties
indemnified pursuant to Section 8(i) and by the Company in the case of
parties indemnified pursuant to Section 8(ii). The indemnifying party
shall not be liable for any settlement of any proceeding effected
without its written consent but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party
agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for
fees and expenses of counsel as contemplated by the fifth sentence of
this paragraph, the indemnifying party agrees that it shall be liable
for any settlement of any proceeding effected without its written
consent to which the indemnification obligations of the Company
hereunder are applicable if (a) such settlement is entered into more
than 60 days after receipt by such indemnifying party of the aforesaid
request and (b) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of
such settlement.
(iv) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless to the extent required
therein an indemnified party under Sections 8(i) or (ii) above in
respect of any losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims,
19
damages or liabilities (or actions or proceedings in respect thereof)
in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Underwriters from the offering of the
Shares. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under Section
8(iii) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as
is appropriate to reflect not only such relative benefits but also the
relative fault of the Company and the Underwriters in connection with
the statements or omissions which resulted in such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof),
as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Underwriters shall be deemed
to be in the same proportion as the total net proceeds from the
offering (before deducting expenses) received by the Company and the
Underwriters bear to the total proceeds of the offering (the proceeds
received by the Underwriters being equal 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 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 or the Underwriters and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be
just and equitable if contributions pursuant to this Section 8(iv) were
determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to
above in this Section 8(iv). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to
above in this Section 8(iv) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8(iv), (a) no
Underwriter shall be required to contribute any amount in excess of the
underwriting discounts and commissions applicable to the Shares
purchased by such Underwriter and (b) no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations under this Section 8(iv) to contribute are several in
proportion to their respective underwriting obligations and not joint.
(v) In any proceeding relating to the Registration Statement,
any Preliminary Prospectus, any Issuer Free Writing Prospectus or the
Prospectus, or any supplement or amendment thereto, each party against
whom contribution may be sought under this Section 8 hereby consents to
the jurisdiction over any other contributing party, agrees that process
issuing from such court may be served upon him or it by any other
contributing party and consents to the service of such process and
agrees that any other contributing party may join him or it as an
additional defendant in any such proceeding in which such other
contributing party is a party.
9. NOTICES. All communications hereunder shall be in writing and,
except as otherwise provided herein, will be mailed, delivered or telecopied and
confirmed as follows: if to the Underwriters, to Deutsche Bank Securities Inc.,
60 Wall Street, 4th Floor, New York, New York 10005, or via fax at (212)
797-2202, Attention: Equity Capital Markets, with a copy to the General Counsel
via fax at (212) 797-4564; if to the Company, to Health Care REIT, Inc., One
SeaGate, Suite 1500, Toledo, Ohio 43603-1475, or via fax at (419) 247-2826,
Attention: George L. Chapman, Chairman of the Board and Chief Executive Officer.
20
10. TERMINATION. This Agreement may be terminated by the
Representatives by notice to the Company as follows:
(i) at any time prior to the Closing Date or any Option
Closing Date (if different from the Closing Date and then only as to
the Option Shares) if any of the following has occurred: (a) since the
date hereof, any adverse change or any development involving a
prospective adverse change in or affecting the condition, financial or
otherwise, of the Company or the earnings, business affairs, management
or business prospects of the Company, whether or not arising in the
ordinary course of business, that, in your judgment, is material so as
to make the offering or delivery of the Shares impracticable or
inadvisable, (b) any outbreak or escalation of hostilities or
declaration of war or national emergency after the date hereof or other
national or international calamity or crisis or change in economic or
political conditions if the effect of such outbreak, escalation,
declaration, emergency, calamity, crisis or change on the financial
markets of the United States would, in your judgment, make the offering
or delivery of the Shares impracticable or inadvisable, (c) trading in
securities generally on the New York Stock Exchange, the American Stock
Exchange or the NASDAQ, or in the Company's securities on the New York
Stock Exchange, shall have been suspended or materially limited (other
than limitations on hours or numbers of days of trading) or minimum
prices shall have been established for securities on any such exchange,
(d) the enactment, publication, decree or other promulgation of any
federal or state statute, regulation, rule or order of any court or
other governmental authority which in your reasonable opinion
materially and adversely affects or will materially or adversely affect
the business or operations of the Company, (e) declaration of a banking
moratorium by either federal or New York State authorities or material
disruption in securities settlement or clearance services in the United
States, (f) the taking of any action by any federal, state or local
government or agency in respect of its monetary or fiscal affairs which
in your reasonable opinion has a material adverse effect on the
securities markets in the United States, or (g) any litigation or
proceeding is pending or threatened against any Underwriter which seeks
to enjoin or otherwise restrain, or seeks damages in connection with,
or questions the legality or validity of this Agreement or the
transactions contemplated hereby; or
(ii) as provided in Sections 6 and 11 of this Agreement.
11. DEFAULT BY UNDERWRITERS. If, on the Closing Date or the Option
Closing Date, as the case may be, any one or more of the Underwriters shall fail
or refuse to purchase Shares that it has or they have agreed to purchase
hereunder on such date (except in the event of a default on the part of the
Company), and the aggregate number of Shares which such defaulting Underwriter
or Underwriters agreed but failed or refused to purchase is ten percent or less
of the aggregate number of Shares to be purchased on such date, the other
Underwriters may make arrangements satisfactory to the Representatives for the
purchase of such Shares by other persons (who may include one or more of the
non-defaulting Underwriters, including the Representatives), but if no such
arrangements are made by the Closing Date or the Option Closing Date, as the
case may be, the other Underwriters shall be obligated severally in the
proportions that the number of Shares set forth opposite their respective names
in Schedule I hereto bears to the aggregate number of Shares set forth opposite
the names of all such non-defaulting Underwriters, or in such other proportions
as the Representatives may specify, to purchase the Shares which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase on such
date. If, on the Closing Date or the Option Closing Date, as the case may be,
any Underwriter or Underwriters shall fail or refuse to purchase Shares and the
aggregate number of Shares with respect to which such default (except in the
event of a default on the part of the Company) occurs is more than ten percent
of the aggregate number of Shares to be purchased, and arrangements satisfactory
to the Representatives and the Company for the purchase of such Shares are not
made within 36 hours after such default, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter or
21
the Company. In any such case either the Representatives or the Company shall
have the right to postpone the Closing or the Option Closing, as the case may
be, but in no event for longer than seven days, in order that the required
changes, if any, in the Registration Statement, the General Disclosure Package
or the Prospectus or in any other documents or arrangements may be effected. As
used in this Agreement, the term "Underwriter" includes any person substituted
for an Underwriter under this Section 11. Any action taken under this Section 11
shall not relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement.
12. SUCCESSORS. This Agreement has been and is made solely for the
benefit of the Underwriters and the Company and their respective successors,
executors, administrators, heirs and assigns, and the officers, directors and
controlling persons referred to herein, and no other person will have any right
or obligation hereunder. The term "successors" shall not include any purchaser
of the Shares merely because of such purchase.
13. INFORMATION PROVIDED BY UNDERWRITERS. The Company and the
Underwriters acknowledge and agree that the only information furnished or to be
furnished by the Underwriters to the Company for inclusion in the Registration
Statement, any Preliminary Prospectus, any Issuer Free Writing Prospectus or the
Prospectus consists of the information set forth in the third and ninth through
sixteenth paragraphs (provided that, with respect to such sixteenth paragraph,
only the Underwriter that maintains a website through which information relating
to the sale of the Shares is provided shall be deemed to have provided
information through such website for purposes of this Section 13 and the
information so provided shall be deemed to include only the information
contained in such website other than the Prospectus) under the caption
"Underwriting" in the Prospectus.
14. MISCELLANEOUS. The reimbursement, indemnification and
contribution agreements contained in this Agreement and the representations,
warranties and covenants in this Agreement shall remain in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of any Underwriter or controlling person thereof, or by or on
behalf of the Company or its directors or officers and (iii) delivery of and
payment for the Shares under this Agreement.
The Company hereby acknowledges that each of the Underwriters
is acting solely as an underwriter in connection with the purchase and sale of
the Company's securities. The Company further acknowledges that the Underwriters
are acting pursuant to a contractual relationship created solely by this
Agreement entered into on an arm's length basis and in no event do the parties
intend that any Underwriter act or be responsible as a fiduciary to the Company,
its management, stockholders, creditors or any other person in connection with
any activity that any Underwriter may undertake or has undertaken in furtherance
of the purchase and sale of the Company's securities, either before or after the
date hereof. The Underwriters hereby expressly disclaim any fiduciary or similar
obligations to the Company, either in connection with the transactions
contemplated by this Agreement or any matters leading up to such transactions,
and the Company hereby confirms its understanding and agreement to that effect.
The Company and the Underwriters agree that they are each responsible for making
their own independent judgments with respect to any such transactions, and that
any opinions or views expressed by the Underwriters to the Company regarding
such transactions, including but not limited to any opinions or views with
respect to the price or market for the Company's securities, do not constitute
advice or recommendations to the Company. The Company hereby waives and
releases, to the fullest extent permitted by law, any claims that the Company
may have against the Underwriters with respect to any breach or alleged breach
of any fiduciary or similar duty to the Company in connection with the
transactions contemplated by this Agreement or any matters leading up to such
transactions.
This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
22
This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York. The Company and the
Underwriters each submits to the exclusive jurisdiction of the courts of the
State of New York located in the City and County of New York and the United
States District Court for the Southern District of New York with respect to any
action or dispute in any way arising out of or relating to this Agreement. Each
of the Company (on its behalf and, to the extent permitted by applicable law, on
behalf of its stockholders and affiliates) and the Underwriters waives all right
to trial by jury in any action, proceeding or counterclaim (whether based upon
contract, tort or otherwise) in any way arising out of or relating to this
Agreement.
[The remainder of this page is intentionally left blank.]
23
If the foregoing letter is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company and the
Underwriters in accordance with its terms.
Very truly yours,
HEALTH CARE REIT, INC.
By: /s/ Scott A. Estes
----------------------------
Name: Scott A. Estes
Title: Senior Vice President and
Chief Financial Officer
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
DEUTSCHE BANK SECURITIES INC.
UBS SECURITIES LLC
As Representatives of the Underwriters listed on Schedule I
By: DEUTSCHE BANK SECURITIES INC.
By: /s/ Gregory Sorensen
-------------------------------------------------
Name: Gregory Sorensen
Title: Managing Director
By: /s/ Lee Stettner
-------------------------------------------------
Name: Lee Stettner
Title: Managing Director
By: UBS SECURITIES LLC
By: /s/ Keith A. Lockwood
-------------------------------------------------
Name: Keith A. Lockwood
Title: Director
By: /s/ Kristin Kusmier
-------------------------------------------------
Name: Kristin Kusmier
Title: Associate Director
SCHEDULE I
SCHEDULE OF UNDERWRITERS
<Table>
<Caption>
NUMBER OF SHARES TO
UNDERWRITER BE PURCHASED
- ----------- ------------
Deutsche Bank Securities Inc. 900,000
UBS Securities LLC 900,000
A.G. Edwards & Sons, Inc. 375,000
Raymond James & Associates, Inc. 300,000
Stifel, Nicolaus & Company, Incorporated 300,000
Calyon Securities (USA) Inc. 75,000
KeyBanc Capital Markets, a division of McDonald Investments Inc. 75,000
LaSalle Financial Services, Inc. 75,000
Total 3,000,000
---------
</Table>
SCHEDULE II
Public Offering Price Per Share: $36.00
Number of Shares Subject to the Offering: 3,000,000
Over-allotment Option: 450,000
SCHEDULE III
NONE.
SCHEDULE IV
SCHEDULE OF SUBSIDIARIES
<Table>
<Caption>
STATE OF ORGANIZATION DATE OF
NAME OF SUBSIDIARY AND TYPE OF ENTITY ORGANIZATION
------------------ ------------------ ------------
HCRI Pennsylvania Properties, Inc. Pennsylvania corporation November 1, 1993
HCRI Overlook Green, Inc. Pennsylvania corporation July 9, 1996
HCRI Texas Properties, Inc. Delaware corporation December 27, 1996
HCRI Texas Properties, Ltd. Texas limited partnership December 30, 1996
Health Care REIT International, Inc. Delaware corporation February 11, 1998
HCN Atlantic GP, Inc. Delaware corporation February 20, 1998
HCN Atlantic LP, Inc. Delaware corporation February 20, 1998
HCRI Nevada Properties, Inc. Nevada corporation March 27, 1998
HCRI Southern Investments I, Inc. Delaware corporation June 11, 1998
HCRI Louisiana Properties, L.P. Delaware limited partnership June 11, 1998
HCN BCC Holdings, Inc. Delaware corporation September 25, 1998
HCRI Tennessee Properties, Inc. Delaware corporation September 25, 1998
HCRI Limited Holdings, Inc. Delaware corporation September 25, 1998
Pennsylvania BCC Properties, Inc. Pennsylvania corporation September 25, 1998
HCRI North Carolina Properties, LLC Delaware limited liability company December 10, 1999
HCRI Massachusetts Properties, Inc. Delaware corporation March 17, 2000
HCRI Massachusetts Properties Trust Massachusetts trust March 30, 2000
HCRI Indiana Properties, Inc. Delaware corporation June 15, 2000
HCRI Indiana Properties, LLC Indiana limited liability company June 16, 2000
HCRI Holdings Trust Massachusetts trust September 11, 2000
HCRI Maryland Properties, LLC Maryland limited liability company July 19, 2001
HCRI Massachusetts Properties Trust II Massachusetts trust September 26, 2001
HCRI Beachwood, Inc. Ohio corporation October 11, 2001
HCRI Broadview, Inc. Ohio corporation October 11, 2001
HCRI Westlake, Inc. Ohio corporation October 11, 2001
HCRI Westmoreland, Inc. Delaware corporation October 16, 2001
HCRI Wisconsin Properties, LLC Wisconsin limited liability company December 11, 2001
HCRI North Carolina Properties I, Inc. North Carolina corporation January 1, 2002
HCRI North Carolina Properties II, Inc. North Carolina corporation January 1, 2002
HCRI North Carolina Properties III, North Carolina limited partnership January 1, 2002
Limited Partnership
HCRI Kentucky Properties, LLC Kentucky limited liability company January 7, 2002
HCRI Mississippi Properties, Inc. Mississippi corporation March 28, 2002
HCRI Illinois Properties, LLC Delaware limited liability company August 21, 2002
HCRI Missouri Properties, LLC Delaware limited liability company August 21, 2002
HCRI Surgical Properties, LLC Ohio limited liability company September 30, 2002
HCRI Tucson Properties, Inc. Delaware corporation November 14, 2002
HCRI Stonecreek Properties, LLC Delaware limited liability company June 25, 2003
HCRI Cold Spring Properties, LLC Delaware limited liability company June 25, 2003
HCRI Eddy Pond Properties Trust Massachusetts trust June 26, 2003
HCRI Investments, Inc. Delaware corporation July 30, 2003
HCRI Forest City Holdings, Inc. North Carolina corporation August 19, 2003
HCRI Asheboro Holdings, Inc. North Carolina corporation August 19, 2003
HCRI Smithfield Holdings, Inc. North Carolina corporation August 19, 2003
<Table>
<Caption>
STATE OF ORGANIZATION DATE OF
NAME OF SUBSIDIARY AND TYPE OF ENTITY ORGANIZATION
------------------ ------------------ ------------
HCRI Greenville Holdings, Inc. North Carolina corporation August 19, 2003
HCRI Forest City Properties, LP North Carolina limited partnership August 19, 2003
HCRI Asheboro Properties, LP North Carolina limited partnership August 19, 2003
HCRI Smithfield Properties, LP North Carolina limited partnership August 19, 2003
HCRI Greenville Properties, LP North Carolina limited partnership August 19, 2003
HCRI Kirkland Properties, LLC Delaware limited liability company August 22, 2003
HCRI Ridgeland Pointe Properties, LLC Delaware limited liability company August 22, 2003
HCRI Drum Hill Properties, LLC Delaware limited liability company August 22, 2003
HCRI Fairmont Properties, LLC Delaware limited liability company August 22, 2003
HCRI Abingdon Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Gaston Place Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Gaston Manor Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Eden Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Weddington Park Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Union Park Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Concord Place Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Salisbury Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Burlington Manor Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Skeet Club Manor Holdings, Inc. North Carolina corporation September 10, 2003
HCRI High Point Manor Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Hickory Manor Holdings, Inc. North Carolina corporation September 10, 2003
HCRI Statesville Place Holdings I, Inc. North Carolina corporation September 10, 2003
HCRI Statesville Place Holdings II, Inc. North Carolina corporation September 10, 2003
HCRI Abingdon Properties, LP North Carolina limited partnership September 10, 2003
HCRI Gaston Place Properties, LP North Carolina limited partnership September 10, 2003
HCRI Gaston Manor Properties, LP North Carolina limited partnership September 10, 2003
HCRI Eden Properties, LP North Carolina limited partnership September 10, 2003
HCRI Weddington Park Properties, LP North Carolina limited partnership September 10, 2003
HCRI Union Park Properties, LP North Carolina limited partnership September 10, 2003
HCRI Concord Place Properties, LP North Carolina limited partnership September 10, 2003
HCRI Salisbury Properties, LP North Carolina limited partnership September 10, 2003
HCRI Burlington Manor Properties, LP North Carolina limited partnership September 10, 2003
HCRI Skeet Club Manor Properties, LP North Carolina limited partnership September 10, 2003
HCRI High Point Manor Properties, LP North Carolina limited partnership September 10, 2003
HCRI Hickory Manor Properties, LP North Carolina limited partnership September 10, 2003
HCRI Statesville Place Properties I, LP North Carolina limited partnership September 10, 2003
HCRI Statesville Place Properties II, LP North Carolina limited partnership September 10, 2003
HCRI Chicago Properties, Inc. Delaware corporation November 18, 2003
HCRI General Properties, Inc. Delaware corporation August 5, 2004
HCRI Kansas Properties, LLC Delaware limited liability company September 3, 2004
HCRI Hunters Glen Properties, LLC Delaware limited liability company September 21, 2004
HCRI Wilburn Gardens Properties, LLC Delaware limited liability company September 21, 2004
HCRI Draper Place Properties Trust Massachusetts trust September 24, 2004
HCRI Marina Place Properties Trust Massachusetts trust September 24, 2004
HCRI Tennessee Properties, LLC Delaware limited liability company November 12, 2004
HH Florida, LLC Delaware limited liability company November 23, 2004
HCRI New Hampshire Properties, LLC Delaware limited liability company May 24, 2005
HCRI Dayton Place -- Denver Properties, Delaware limited liability company May 24, 2005
LLC
HCRI Provider Properties, LLC Delaware limited liability company November 10, 2005
<Table>
<Caption>
STATE OF ORGANIZATION DATE OF
NAME OF SUBSIDIARY AND TYPE OF ENTITY ORGANIZATION
------------------ ------------------ ------------
1920 Cleveland Road West, LLC Delaware limited liability company December 15, 2005
721 Hickory Street, LLC Delaware limited liability company December 15, 2005
111 Lazelle Road East, LLC Delaware limited liability company December 15, 2005
5166 Spanson Drive SE, LLC Delaware limited liability company December 15, 2005
1425 Yorkland Road, LLC Delaware limited liability company December 15, 2005
222 East Beech Street -- Jefferson, L.L.C. Delaware limited liability company December 16, 2005
130 Buena Vista Street, LLC Delaware limited liability company December 19, 2005
1850 Crown Park Court, LLC Delaware limited liability company December 19, 2005
1785 Freshley Avenue, LLC Delaware limited liability company December 19, 2005
5700 Karl Road, LLC Delaware limited liability company December 19, 2005
HCRI Senior Housing Properties, Inc. Delaware corporation March 24, 2006
</Table>