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DRAFT
6/7/96
WASHINGTON REAL ESTATE INVESTMENT TRUST
(a District of Columbia business trust)
Debt Securities
UNDERWRITING AGREEMENT
June __, 1996
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
Washington Real Estate Investment Trust, a real estate investment
trust organized under the laws of the District of Columbia (the "Company"),
proposes to issue and sell debt securities (the "Debt Securities"), from time
to time, in one or more offerings on terms to be determined at the time of
sale. The Debt Securities will be issued under an indenture, dated as of June
1, 1996 (the "Indenture"), between the Company and The First National Bank of
Chicago, as trustee (the "Indenture Trustee"). Each series of Debt Securities
may vary, as applicable, as to title, aggregate principal amount, interest rate
or formula and timing of payments thereof, stated maturity date, redemption
and/or repayment provisions, sinking fund requirements, and any other variable
terms established by or pursuant to the Indenture.
Whenever the Company determines to make an offering of Debt Securities
through Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated
("Merrill Lynch"), or through an underwriting syndicate managed by Merrill
Lynch, the Company will enter into an
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agreement (each, a "Terms Agreement") providing for the sale of such Debt
Securities (the "Underwritten Securities") to, and the purchase and offering
thereof by, Merrill Lynch and such other underwriters, if any, selected by
Merrill Lynch (the "Underwriters", which term shall include Merrill Lynch,
whether acting as sole Underwriter or as a member of an underwriting syndicate,
as well as any Underwriter substituted pursuant to Section 10 hereof). The
Terms Agreement relating to the offering of Underwritten Securities shall
specify the aggregate principal amount of Underwritten Securities to be
initially issued (the "Initial Underwritten Securities"), the name of each
Underwriter participating in such offering (subject to substitution as provided
in Section 10 hereof) and the name of any Underwriter other than Merrill Lynch
acting as co-manager in connection with such offering, the aggregate principal
amount of Initial Underwritten Securities which each such Underwriter severally
agrees to purchase, whether such offering is on a fixed or variable price basis
and, if on a fixed price basis, the initial offering price, the price at which
the Initial Underwritten Securities are to be purchased by the Underwriters,
the form, time, date and place of delivery and payment of the Initial
Underwritten Securities and any other material variable terms of the Initial
Underwritten Securities. In addition, if applicable, such Terms Agreement
shall specify whether the Company has agreed to grant to the Underwriters an
option to purchase additional Underwritten Securities to cover over-allotments,
if any, and the aggregate principal amount of Underwritten Securities subject
to such option (the "Option Underwritten Securities"). As used herein, the
term "Underwritten Securities" shall include the Initial Underwritten
Securities and all or any portion of any Option Underwritten Securities. The
Terms Agreement, which shall be substantially in the form of Exhibit A hereto,
may take the form of an exchange of any standard form of written
telecommunication between the Company and Merrill Lynch, acting for itself and,
if applicable, as representative of any other Underwriters. Each offering of
Underwritten Securities through Merrill Lynch as sole Underwriter or through an
underwriting syndicate managed by Merrill Lynch will be governed by this
Underwriting Agreement, as supplemented by the applicable Terms Agreement.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-_________) [and
pre-effective amendment[s] no[s]. ______ thereto] for the registration of the
Debt Securities under the Securities Act of 1933, as amended (the "1933 Act"),
and the offering thereof from time to time in accordance with Rule 415 of the
rules and regulations of the Commission under the 1933 Act (the "1933 Act
Regulations"), and the Company has filed such post-effective amendments thereto
as may be required prior to the execution of the applicable Terms Agreement.
Such registration statement (as so amended, if applicable) has been declared
effective by the Commission and the Indenture has been duly qualified under the
Trust Indenture Act of 1939, as amended (the "1939 Act"). Such registration
statement (as so amended, if applicable), including the information, if any,
deemed to be a part thereof pursuant to Rule 430A(b) of the 1933 Act
Regulations (the "Rule 430A Information") or Rule 434(d) of the 1933 Act
Regulations (the "Rule 434 Information"), is referred to herein as the
"Registration Statement"; and the final prospectus and the final prospectus
supplement relating to the offering of the Underwritten Securities, in the form
first furnished to the Underwriters by the Company for use in connection
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with the offering of the Underwritten Securities, are collectively referred to
herein as the "Prospectus"; provided, however, that all references to the
"Registration Statement" and the "Prospectus" shall also be deemed to include
all documents incorporated therein by reference pursuant to the Securities
Exchange Act of 1934, as amended (the "1934 Act"), prior to the execution of
the applicable Terms Agreement; provided, further, that if the Company files a
registration statement with the Commission pursuant to Rule 462(b) of the 1933
Act Regulations (the "Rule 462 Registration Statement"), then, after such
filing, all references to "Registration Statement" shall also be deemed to
include the Rule 462 Registration Statement; and provided, further, that if the
Company elects to rely upon Rule 434 of the 1933 Act Regulations, then all
references to "Prospectus" shall also be deemed to include the final or
preliminary prospectus and the applicable term sheet or abbreviated term sheet
(the "Term Sheet"), as the case may be, in the form first furnished to the
Underwriters by the Company in reliance upon Rule 434 of the 1933 Act
Regulations, and all references in this Underwriting Agreement to the date of
the Prospectus shall mean the date of the Term Sheet. A "preliminary
prospectus" shall be deemed to refer to any prospectus used before the
registration statement became effective and any prospectus that omitted, as
applicable, the Rule 430A Information, the Rule 434 Information or other
information to be included upon pricing in a form of prospectus filed with the
Commission pursuant to Rule 424(b) of the 1933 Act Regulations, that was used
after such effectiveness and prior to the execution and delivery of the
applicable Terms Agreement. For purposes of this Underwriting Agreement, all
references to the Registration Statement, Prospectus, Term Sheet or preliminary
prospectus or to any amendment or supplement to any of the foregoing shall be
deemed to include any copy filed with the Commission pursuant to its Electronic
Data Gathering, Analysis and Retrieval system ("EDGAR").
All references in this Underwriting Agreement to financial statements
and schedules and other information which is "contained," "included" or
"stated" (or other references of like import) in the Registration Statement,
Prospectus or preliminary prospectus shall be deemed to mean and include all
such financial statements and schedules and other information which is
incorporated by reference in the Registration Statement, Prospectus or
preliminary prospectus, as the case may be; and all references in this
Underwriting Agreement to amendments or supplements to the Registration
Statement, Prospectus or preliminary prospectus shall be deemed to mean and
include the filing of any document under the 1934 Act which is incorporated by
reference in the Registration Statement, Prospectus or preliminary prospectus,
as the case may be.
SECTION 1. Representations and Warranties.
(a) The Company represents and warrants to Merrill Lynch, as of the
date hereof, and to each Underwriter named in the applicable Terms Agreement,
as of the date thereof, as of the Closing Time (as defined below) and, if
applicable, as of each Date of Delivery (as defined below) (in each case, a
"Representation Date"), as follows:
(1) The Company meets the requirements for use of Form S-3 under
the 1933 Act. Each of the Registration Statement and any Rule 462(b)
Registration Statement has
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become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or,
to the knowledge of the Company, are contemplated by the Commission,
and any request on the part of the Commission for additional
information has been complied with. In addition, the Indenture has
been duly qualified under the 1939 Act.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments
thereto (including the filing of the Company's most recent Annual
Report on Form 10-K with the Commission (the "Annual Report on Form
10-K")) became effective and at each Representation Date, the
Registration Statement, any Rule 462(b) Registration Statement and any
amendments and supplements thereto complied and will comply in all
material respects with the requirements of the 1933 Act and the 1933
Act Regulations and the 1939 Act and the rules and regulations of the
Commission under the 1939 Act (the "1939 Act Regulations") and did not
and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading. At the date of the
Prospectus, at the Closing Time and at each Date of Delivery, if any,
the Prospectus and any amendments and supplements thereto did not and
will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading. If the Company elects to rely upon Rule 434 of the
1933 Act Regulations, the Company will comply with the requirements of
Rule 434. Notwithstanding the foregoing, the representations and
warranties in this subsection shall not apply to statements in or
omissions from the Registration Statement or the Prospectus made in
reliance upon and in conformity with information furnished to the
Company in writing by any Underwriter through Merrill Lynch expressly
for use in the Registration Statement or the Prospectus.
Each preliminary prospectus and prospectus filed as part
of the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectus
delivered to the Underwriters for use in connection with the offering
of Underwritten Securities will, at the time of such delivery, be
identical to any electronically transmitted copies thereof filed with
the Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
(2) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement and the Prospectus, at the
time they were or hereafter are filed with the Commission, complied
and will comply in all material respects with the requirements of the
1934 Act and the rules and regulations of the Commission thereunder
(the "1934 Act Regulations") and, when read together with the other
information in the
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Prospectus, at the date of the Prospectus, at the Closing Time and at
each Date of Delivery, if any, did not and will not include an untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(3) The accountants who certified the financial statements and
any supporting schedules thereto included in the Registration
Statement and the Prospectus are independent public accountants as
required by the 1933 Act and the 1933 Act Regulations.
(4) The financial statements of the Company included in the
Registration Statement and the Prospectus, together with the related
schedules and notes, as well as those financial statements, schedules
and notes of any other entity included therein, present fairly the
financial position of the Company and its consolidated subsidiaries,
or such other entity, as the case may be, at the dates indicated and
the statement of operations, shareholders' equity and cash flows of
the Company and its consolidated subsidiaries, or such other entity,
as the case may be, for the periods specified. Such financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis
throughout the periods involved. The supporting schedules, if any,
included in the Registration Statement and the Prospectus present
fairly in accordance with GAAP the information required to be stated
therein. The selected financial data and the summary financial
information included in the Prospectus present fairly the information
shown therein and have been compiled on a basis consistent with that
of the audited financial statements included in the Registration
Statement and the Prospectus. In addition, any pro forma financial
statements of the Company and its subsidiaries and the related notes
thereto included in the Registration Statement and the Prospectus
present fairly the information shown therein, have been prepared in
accordance with the Commission's rules and guidelines with respect to
pro forma financial statements and have been properly compiled on the
bases described therein, and the assumptions used in the preparation
thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions and circumstances
referred to therein.
(5) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, except as otherwise
stated therein, (A) there has been no material adverse change in the
condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary
course of business (a "Material Adverse Effect"), (B) there have been
no transactions entered into by the Company or any of its
subsidiaries, other than those arising in the ordinary course of
business, which are material with respect to the Company and its
subsidiaries considered as one enterprise and (C) except for regular
dividends on the Company's shares of beneficial interest, in amounts
per share that are consistent with past practice, there has been no
dividend or
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distribution of any kind declared, paid or made by the Company on any
class of its capital stock.
(6) The Company has been duly organized and is validly existing
as a business trust of unlimited duration with transferable shares of
beneficial interest in good standing under the laws of the District of
Columbia, with full power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus
and to enter into and perform its obligations under, or as
contemplated under, this Underwriting Agreement and the applicable
Terms Agreement. The Company is duly qualified as a foreign
corporation to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify or be in good
standing would not result in a Material Adverse Effect.
(7) Each "significant subsidiary" of the Company (as such term
is defined in Rule 1-02 of Regulation S-X promulgated under the 1933
Act) (each, a "Subsidiary" and, collectively, the "Subsidiaries")
(which term includes corporations, limited and general partnerships,
joint ventures and other entities, and includes direct and indirect
subsidiaries), if any, has been duly organized and is validly existing
as a corporation or partnership, as the case may be, in good standing
under the laws of the jurisdiction of its organization, has power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except
where the failure to so qualify or be in good standing would not
result in a Material Adverse Effect. Except as otherwise stated in
the Registration Statement and the Prospectus, all of the issued and
outstanding capital stock or other ownership interests of each
Subsidiary have been duly authorized and validly issued, are fully
paid and non-assessable and are owned by the Company, directly or
through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(8) The authorized, issued and outstanding shares of beneficial
interest of the Company are as set forth in the Prospectus under the
caption "Capitalization" (except for subsequent issuances thereof, if
any, contemplated under this Underwriting Agreement, pursuant to
dividend reinvestment plans, reservations, agreements or employee
benefit plans referred to in the Prospectus or pursuant to the
exercise of convertible securities or options referred to in the
Prospectus). Such shares of beneficial interest have been duly
authorized and validly issued by the Company and are fully paid and
non-assessable, and none of such shares of beneficial interest was
issued in violation of preemptive or other similar rights of any
securityholder of the Company.
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(9) This Underwriting Agreement has been, and the applicable
Terms Agreement as of the date thereof will have been, duly
authorized, executed and delivered by the Company.
(10) The Underwritten Securities being sold pursuant to the
applicable Terms Agreement have been, or as of the date of such Terms
Agreement will have been, duly authorized by the Company for issuance
and sale pursuant to this Underwriting Agreement and such Terms
Agreement. Such Underwritten Securities, when issued and
authenticated in the manner provided for in the Indenture and
delivered against payment of the consideration therefor specified in
such Terms Agreement, will constitute valid and legally binding
obligations of the Company, enforceable against the Company in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting creditors' rights generally or
by general equitable principles, and except further as enforcement
thereof may be limited by (A) requirements that a claim with respect
to any Debt Securities denominated other than in U.S. dollars (or a
foreign or composite currency judgment in respect of such claim) be
converted into U.S. dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law or (B) governmental authority to
limit, delay or prohibit the making of payments outside the United
States. Such Underwritten Securities will be in the form contemplated
by, and each registered holder thereof is entitled to the benefits of,
the Indenture.
(11) The Indenture has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding
agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting creditors' rights generally or
by general equitable principles.
(12) The Underwritten Securities being sold pursuant to the
applicable Terms Agreement and the Indenture, as of the date of the
Prospectus, will conform in all material respects to the statements
relating thereto contained in the Prospectus and will be in
substantially the form filed or incorporated by reference, as the case
may be, as an exhibit to the Registration Statement.
(13) Neither the Company nor any of its subsidiaries is in
violation of its declaration of trust, partnership agreement, charter,
by-laws or other organizational document or in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of
trust, loan or credit agreement, note, lease or other agreement or
instrument to which the Company or any of its subsidiaries is a party
or by which it or any of them may be bound, or to which any of the
property or assets of the Company or any of its subsidiaries is
subject, except for such defaults that would not result in a Material
Adverse Effect. The execution, delivery and performance of this
Underwriting Agreement, the applicable Terms Agreement and the
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Indenture and any other agreement or instrument entered into or issued
or to be entered into or issued by the Company in connection with the
transactions contemplated hereby or thereby or in the Registration
Statement and the Prospectus and the consummation of the transactions
contemplated herein and in the Registration Statement and the
Prospectus and compliance by the Company with its obligations
hereunder and thereunder have been duly authorized by all necessary
action on the part of the Company and do not and will not, whether
with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default under, or result
in the creation or imposition of any lien, charge or encumbrance upon
any assets, properties or operations of the Company or any of its
subsidiaries pursuant to, any contract, indenture, mortgage, deed of
trust, loan or credit agreement, note, lease or other agreement or
instrument to which the Company or any of its subsidiaries is a party
or which it or any of them may be bound or to which any property or
assets of the Company or any of its subsidiaries is subject (except
for such conflicts, breaches, defaults, events or liens, charges or
encumbrances that would not result in a Material Adverse Effect) nor
will such action result in any violation of the provisions of the
declaration of trust, partnership agreement, charter, by-laws, or
other organizational documents of the Company or any of its
subsidiaries or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction
over the Company or any if its subsidiaries or any of their assets,
properties or operations.
(14) There is not pending or threatened any action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or to
the knowledge of the Company threatened, against or affecting the
Company or any of its subsidiaries which is required to be disclosed
in the Registration Statement and the Prospectus (other than as stated
therein), or which might reasonably be expected to result in a
Material Adverse Effect, or which might reasonably be expected to
materially and adversely affect the assets, properties or operations
thereof or the consummation of the transactions contemplated under
this Underwriting Agreement, the applicable Terms Agreement or the
Indenture or the performance by the Company of its obligations
hereunder and thereunder. The aggregate of all pending legal or
governmental proceedings to which the Company or any of its
subsidiaries is a party or of which any of their respective assets,
properties or operations is the subject which are not described in the
Registration Statement and the Prospectus, including ordinary routine
litigation incidental to the business, could not reasonably be
expected to result in a Material Adverse Effect.
(15) There are no contracts or documents which are required to
be described in the Registration Statement, the Prospectus or the
documents incorporated by reference therein or to be filed as exhibits
thereto which have not been so described and filed as required.
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(16) 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 Underwriting Agreement, the applicable
Terms Agreement and the Indenture and the consummation of the
transactions herein and therein contemplated (except such additional
steps as may be required by the National Association of Securities
Dealers, Inc. (the "NASD") or may be necessary to qualify the
Underwritten Securities for public offering by the Underwriters under
state securities or Blue Sky laws) has been obtained or made and is in
full force and effect.
(17) The Company and its subsidiaries hold all material
licenses, certificates and permits from governmental authorities which
are necessary to the conduct of their business; and neither the
Company nor any subsidiary has infringed any patents, patent rights,
trade names, trademarks or copyrights, which infringement would result
in a Material Adverse Effect.
(18) With respect to all tax periods regarding which the
Internal Revenue Service is or will be entitled to assert any claim,
the Company has met the requirements for qualification as a real
estate investment trust under Sections 856 through 860 of the Internal
Revenue Code, as amended, and the Company's present and contemplated
operations, assets and income continue to meet such requirements.
(19) The Company and its subsidiaries have good and marketable
title to, or valid and enforceable leasehold estates in, all items of
real and personal property referred to in the Prospectus as owned or
leased by them, in each case free and clear of all liens,
encumbrances, claims, security interests and defects, other than those
referred to in the Prospectus or which are not material in amount.
Each lease of real peroperty by the Company or any of its
subsidiaries, as lessor requiring annual lease payments in excess of
$100,000 is the legal, valid and binding obligation of the lessee in
accordance with its terms (except that the remedy of specific
performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court
before which any proceeding therefor may be brought and to the
Bankruptcy Act) and the rents which at present have remained due and
unpaid for more than 30 days are not payable under leases such that,
were no further rental payments to be received under such leases, the
financial condition or results of operations of the Company and its
subsidiaries would be materially adversely affected thereby. The
Company has no reason to believe that the lessee under any lease
(excluding leases for which rent payments due for the remainder of
such lease are less than $500,000) calling for annual lease payments
in excess of $500,000 is not financially capable of performing its
obligations thereunder.
(20) 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.
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(21) The Underwritten Securities, upon issuance, will be excluded
or exempted under, or beyond the purview of, the Commodity Exchange
Act, as amended (the "Commodity Exchange Act"), and the rules and
regulations of the Commodity Futures Trading Commission under the
Commodity Exchange Act (the "Commodity Exchange Act Regulations").
(22) The Company is not, and upon the issuance and sale of the
Underwritten Securities as herein contemplated and the application of
the net proceeds therefrom as described in the Prospectus will not be,
an "investment company" within the meaning of the Investment Company
Act of 1940, as amended (the "1940 Act").
(23) The Company has no knowledge of (a) the unlawful presence of
any hazardous substances, hazardous materials, toxic substances or
waste materials (collectively, "Hazardous Materials") on any of the
properties owned by it or any of its subsidiaries, or of (b) any
unlawful spills, releases, discharges or disposal of Hazardous
Materials that have occurred or are presently occurring off such
properties as a result of any construction on or operation and use of
such properties which presence or occurrence, singly or in the
aggregate, would result in a Material Adverse Effect. In connection
with the construction on or operation and the use of the properties
owned by the Company and its subsidiaries, the Company represents
that, as of the date of this Underwriting Agreement and will represent
that, as of the date of the applicable Terms Agreement, it has no
knowledge of any material failure to comply with all applicable local,
state and federal environmental laws, regulations, ordinances and
administrative and judicial orders relating to the generation,
recycling, reuse, sale, storage, handling, transport and disposal of
any Hazardous Materials.
(24) The Company has complied with, and is and will be in
compliance with, the provisions of that certain Florida act relating
to disclosure of doing business with Cuba, codified as Section 517.075
of the Florida statutes, and the rules and regulations thereunder or
is exempt therefrom.
(b) Any certificate signed by any officer of the Company or any of its
subsidiaries and delivered to any Underwriter or to counsel for the
Underwriters in connection with the offering of the Underwritten Securities
shall be deemed a representation and warranty by the Company to each
Underwriter as to the matters covered thereby on the date of such certificate
and, unless subsequently amended or supplemented, at each Representation Date
subsequent thereto.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) The several commitments of the Underwriters to purchase the
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to have been made on the basis of the representations and warranties
herein contained and shall be subject to the terms and conditions herein set
forth.
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(b) In addition, subject to the terms and conditions herein set
forth, the Company may grant, if so provided in the applicable Terms Agreement,
an option to the Underwriters, severally and not jointly, to purchase up to the
aggregate principal amount of the Option Underwritten Securities set forth
therein at a price per Option Underwritten Security equal to the price per
Initial Underwritten Security. Such option, if granted, will expire 30 days
after the date of such Terms Agreement, and may be exercised in whole or in
part from time to time only for the purpose of covering over-allotments which
may be made in connection with the offering and distribution of the Initial
Underwritten Securities upon notice by Merrill Lynch to the Company setting
forth the aggregate principal amount of Option Underwritten Securities as to
which the several Underwriters are then exercising the option and the time,
date and place of payment and delivery for such Option Underwritten Securities.
Any such time and date of payment and delivery (each, a "Date of Delivery")
shall be determined by Merrill Lynch, but shall not be later than seven full
business days after the exercise of said option, nor in any event prior to the
Closing Time, unless otherwise agreed upon by Merrill Lynch and the Company.
If the option is exercised as to all or any portion of the Option Underwritten
Securities, each of the Underwriters, severally and not jointly, will purchase
that proportion of the aggregate principal amount of Option Underwritten
Securities then being purchased which the aggregate principal amount of Initial
Underwritten Securities each such Underwriter has severally agreed to purchase
as set forth in such Terms Agreement bears to the aggregate principal amount of
Initial Underwritten Securities.
(c) Payment of the purchase price for, and delivery of, the Initial
Underwritten Securities shall be made at the offices of Andrews & Kurth L.L.P.,
1701 Pennsylvania Avenue, N.W., Washington, D.C. 20006, or at such other place
as shall be agreed upon by Merrill Lynch and the Company, at 10:00 A.M.
(Eastern time) on the third (fourth, if the pricing occurs after 4:30 P.M.
(Eastern time) on any given day) business day after the date of the applicable
Terms Agreement (unless postponed in accordance with the provisions of Section
10 hereof), or such other time not later than ten business days after such date
as shall be agreed upon by Merrill Lynch and the Company (such time and date of
payment and delivery being herein called "Closing Time"). In addition, in the
event that the Underwriters have exercised their option, if any, to purchase
any or all of the Option Underwritten Securities, payment of the purchase price
for, and delivery of such Option Underwritten Securities, shall be made at the
above-mentioned offices of Andrews & Kurth L.L.P., or at such other place as
shall be agreed upon by Merrill Lynch and the Company, on the relevant Date of
Delivery as specified in the notice from Merrill Lynch to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery
to Merrill Lynch for the respective accounts of the Underwriters of the
Underwritten Securities to be purchased by them. It is understood that each
Underwriter has authorized Merrill Lynch, for its account, to accept delivery
of, receipt for, and make payment of the purchase price for, the Underwritten
Securities which it has severally agreed to purchase. Merrill Lynch,
individually and not as representative of the Underwriters, may (but shall not
be obligated to) make payment of the purchase price for
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the Underwritten Securities to be purchased by any Underwriter whose funds have
not been received by the Closing Time or the relevant Date of Delivery, as the
case may be, but such payment shall not relieve such Underwriter from its
obligations hereunder.
(d) The Underwritten Securities shall be in such denominations and
registered in such names as Merrill Lynch may request in writing at least one
full business day prior to the Closing Time or the relevant Date of Delivery,
as the case may be. The Underwritten Securities, which may be in temporary
form, will be made available for examination and packaging by Merrill Lynch in
The City of New York not later than 10:00 A.M. (Eastern time) on the business
day prior to the Closing Time or the relevant Date of Delivery, as the case may
be.
SECTION 3. Covenants of the Company. The Company covenants with
Merrill Lynch and with each Underwriter participating in the offering of
Underwritten Securities, as follows:
(a) The Company, subject to Section 3(b), will comply with the
requirements of Rule 430A of the 1933 Act Regulations and/or Rule 434
of the 1933 Act Regulations, if and as applicable, and will notify the
Representative(s) immediately, and confirm the notice in writing, of
(i) the effectiveness of any post-effective amendment to the
Registration Statement or the filing of any supplement or amendment to
the Prospectus, (ii) the receipt of any comments from the Commission,
(iii) any request by the Commission for any amendment to the
Registration Statement or any amendment or supplement to the
Prospectus or for additional information, and (iv) the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the
use of any preliminary prospectus, or of the suspension of the
qualification of the Underwritten Securities for offering or sale in
any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes. The Company will promptly
effect the filings necessary pursuant to Rule 424 and will take such
steps as it deems necessary to ascertain promptly whether the
Prospectus transmitted for filing under Rule 424 was received for
filing by the Commission and, in the event that it was not, it will
promptly file the Prospectus. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any stop
order is issued, to obtain the lifting thereof at the earliest
possible moment.
(b) The Company will give Merrill Lynch notice of its intention
to file or prepare any amendment to the Registration Statement
(including any filing under Rule 462(b) of the 1933 Act Regulations),
any Term Sheet or any amendment, supplement or revision to either the
prospectus included in the Registration Statement at the time it
became effective or to the Prospectus, whether pursuant to the 1933
Act, the 1934 Act or otherwise, will furnish Merrill Lynch with copies
of any such documents a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file or use
any such document to which Merrill Lynch or counsel for the
Underwriters shall object.
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(c) The Company has furnished or will deliver to Merrill Lynch
and counsel for the Underwriters, without charge, signed copies of the
Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated or deemed to be
incorporated by reference therein) and signed copies of all consents
and certificates of experts, and will also deliver to Merrill Lynch,
without charge, a conformed copy of the Registration Statement as
originally filed and of each amendment thereto (without exhibits) for
each of the Underwriters. Copies of the Registration Statement and
each amendment thereto furnished to the Underwriters will be identical
to any electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
(d) The Company will deliver to each Underwriter, without
charge, as many copies of each preliminary prospectus as such
Underwriter may reasonably request, and the Company hereby consents to
the use of such copies for purposes permitted by the 1933 Act. The
Company will furnish to each Underwriter, without charge, during the
period when the Prospectus is required to be delivered under the 1933
Act or the 1934 Act, such number of copies of the Prospectus as such
Underwriter may reasonably request. The Prospectus and any amendments
or supplements thereto furnished to the Underwriters will be identical
to any electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
(e) The Company will comply with the 1933 Act and the 1933 Act
Regulations and the 1934 Act and the 1934 Act Regulations so as to
permit the completion of the distribution of the Underwritten
Securities as contemplated in this Underwriting Agreement and the
applicable Terms Agreement and in the Registration Statement and the
Prospectus. If at any time when the Prospectus is required by the
1933 Act or the 1934 Act to be delivered in connection with sales of
the Securities, any event shall occur or condition shall exist as a
result of which it is necessary, in the opinion of counsel for the
Underwriters or for the Company, to amend the Registration Statement
in order that the Registration Statement will not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading or to amend or supplement the Prospectus in order that the
Prospectus will not include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the
statements therein not misleading in the light of the circumstances
existing at the time it is delivered to a purchaser, or if it shall be
necessary, in the opinion of such counsel, at any such time to amend
the Registration Statement or amend or supplement the Prospectus in
order to comply with the requirements of the 1933 Act or the 1933 Act
Regulations, the Company will promptly prepare and file with the
Commission, subject to Section 3(b), such amendment or supplement as
may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such
requirements, and the
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Company will furnish to the Underwriters, without charge, such number
of copies of such amendment or supplement as the Underwriters may
reasonably request.
(f) The Company will use its best efforts, in cooperation with
the Underwriters, to qualify the Underwritten Securities for offering
and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as Merrill Lynch may designate and
to maintain such qualifications in effect for a period of not less
than one year from the date of the applicable Terms Agreement;
provided, however, that the Company shall not be obligated to file any
general consent to service of process or to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which
it is not so qualified or to subject itself to taxation in respect of
doing business in any jurisdiction in which it is not otherwise so
subject. In each jurisdiction in which the Underwritten Securities
have been so qualified, the Company will file such statements and
reports as may be required by the laws of such jurisdiction to
continue such qualification in effect for a period of not less than
one year from the date of such Terms Agreement.
(g) The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
security holders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the 1933 Act.
(h) The Company will use the net proceeds received by it from
the sale of the Underwritten Securities in the manner specified in the
Prospectus under "Use of Proceeds".
(i) The Company will use its best efforts to effect the listing
of the Underwritten Securities, prior to the Closing Time, on any
national securities exchange or quotation system if and as specified
in the applicable Terms Agreement.
(j) Between the date of the applicable Terms Agreement and the
Closing Time or such other date specified in such Terms Agreement, the
Company will not, without the prior written consent of Merrill Lynch,
directly or indirectly, issue, sell, offer to sell, grant any option
for the sale of, or otherwise dispose of, the securities specified in
such Terms Agreement.
(k) The Company, during the period when the Prospectus is
required to be delivered under the 1933 Act or the 1934 Act, will file
all documents required to be filed with the Commission pursuant to the
1934 Act within the time periods required by the 1934 Act and the 1934
Act Regulations.
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(l) The Company will elect to qualify as a "real estate
investment trust" under the Internal Revenue Code of 1986, as
amended, and will use its best efforts to continue to meet the
requirements to qualify as a "real estate investment trust".
SECTION 4. Payment of Expenses. (a) The Company will pay all
expenses incident to the performance of its obligations under this Underwriting
Agreement and the applicable Terms Agreement, including (i) the preparation,
printing and filing of the Registration Statement (including financial
statements and exhibits) as originally filed and of each amendment thereto,
(ii) the preparation, printing and delivery to the Underwriters of this
Underwriting Agreement, any Terms Agreement, any Agreement among Underwriters,
the Indenture and such other documents as may be required in connection with
the offering, purchase, sale, issuance or delivery of the Underwritten
Securities, (iii) the preparation, issuance and delivery of the Underwritten
Securities and any certificates for the Underwritten Securities to the
Underwriters, including any transfer taxes and any stamp or other duties
payable upon the sale, issuance or delivery of the Underwritten Securities to
the Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors or agents (including transfer agents and
registrars), as well as the fees and disbursements of the Indenture Trustee and
its counsel, (v) the qualification of the Underwritten Securities under state
securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the
preparation, printing and delivery of the Blue Sky Survey and any Legal
Investment Survey, and any amendment thereto, (vi) the printing and delivery to
the Underwriters of copies of each preliminary prospectus, any Term Sheet, and
the Prospectus and any amendments or supplements thereto, (vii) the fees
charged by nationally recognized statistical rating organizations for the
rating of the Underwritten Securities, and if applicable, (viii) the fees and
expenses incurred with respect to the listing of the Underwritten Securities,
if applicable, and (ix) the filing fees incident to, and the reasonable fees
and disbursements of counsel to the Underwriters in connection with, the
review, if any, by the National Association of Securities Dealers, Inc. (the
"NASD") of the terms of the sale of the Underwritten Securities.
(b) If the applicable Terms Agreement is terminated by Merrill Lynch
in accordance with the provisions of Section 5 or Section 9(b)(i) hereof, the
Company shall reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the
Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations
of the Underwriters to purchase and pay for the Underwritten Securities
pursuant to the applicable Terms Agreement are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or any of its subsidiaries
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
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(a) The Registration Statement, including any Rule 462(b)
Registration Statement, has become effective under the 1933 Act and no
stop order suspending the effectiveness of the Registration Statement
shall have been issued under the 1933 Act and no proceedings for that
purpose shall have been initiated or be pending or threatened by the
Commission, and any request on the part of the Commission for
additional information shall have been complied with to the reasonable
satisfaction of counsel to the Underwriters. A prospectus containing
information relating to the description of the Underwritten
Securities, the specific method of distribution and similar matters
shall have been filed with the Commission in accordance with Rule
424(b)(1), (2), (3), (4) or (5), as applicable (or any required
post-effective amendment providing such information shall have been
filed and declared effective in accordance with the requirements of
Rule 430A), or, if the Company has elected to rely upon Rule 434 of
the 1933 Act Regulations, a Term Sheet including the Rule 434
Information shall have been filed with the Commission in accordance
with Rule 424(b)(7).
(b) At Closing Time, Merrill Lynch shall have received:
(1) The favorable opinion, dated as of Closing Time, of
Arent Fox Kintner Plotkin & Kahn, special counsel for the
Company, in form and substance satisfactory to counsel for the
Underwriters, to the effect that:
(i) The Company has been duly organized and is
validly existing as a business trust in good standing
under the laws of the District of Columbia, with
power and authority to own, lease and operate its
properties and conduct its business as described in
the Prospectus and to enter into and perform its
obligations under the Underwriting Agreement and the
applicable Terms Agreement; and the conditions for
use of a registration statement on Form S-3 have been
satisfied.
(ii) Each Subsidiary has been duly organized
and is validly existing as a corporation or
partnership, as the case may be, in good standing
under the laws of the jurisdiction of its
organization and has power and authority to own,
lease and operate its properties and to conduct its
business as described in the Prospectus. Except as
otherwise stated in the Registration Statement and
the Prospectus, all of the issued and outstanding
capital stock or other ownership interests of each
Subsidiary have been duly authorized and are validly
issued, are fully paid and non-assessable and, to the
best of the knowledge of such counsel, are owned by
the Company, directly or through subsidiaries, free
and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity.
(iii) The authorized, issued and outstanding
shares of beneficial interest of the Company are as
set forth in the Prospectus under the caption
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"Capitalization" (except for subsequent issuances
thereof, if any, contemplated under the Underwriting
Agreement, pursuant to dividend reinvestment plans,
reservations, agreements or employee benefit plans
referred to in the Prospectus or pursuant to the
exercise of convertible securities or options
referred to in the Prospectus). Such shares of
beneficial interest have been duly authorized and
validly issued by the Company and are fully paid and
non-assessable, and none of such shares of beneficial
interest was issued in violation of preemptive or
other similar rights of any securityholder of the
Company.
(iv) The Underwriting Agreement and the
applicable Terms Agreement have been duly authorized,
executed and delivered by the Company.
(v) The Underwritten Securities have been duly
authorized by the Company for issuance and sale
pursuant to the Underwriting Agreement and the
applicable Terms Agreement. The Underwritten
Securities, when issued and authenticated in the
manner provided for in the Indenture and delivered
against payment of the consideration therefor
specified in such Terms Agreement, will constitute
valid and legally binding obligations of the Company,
enforceable against the Company in accordance with
their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or
affecting creditors' rights generally or by general
equitable principles, and except further as
enforcement thereof may be limited by (A)
requirements that a claim with respect to any Debt
Securities denominated other than in U.S. dollars (or
a foreign or composite currency judgement in respect
of such claim) be converted into U.S. dollars at a
rate of exchange prevailing on a date determined
pursuant to applicable law or (B) governmental
authority to limit, delay or prohibit the making of
payments outside the United States. The Underwritten
Securities are in the form contemplated by, and each
registered holder thereof is entitled to the benefits
of, the Indenture.
(vi) The Indenture has been duly authorized,
executed and delivered by the Company and (assuming
due authorization, execution and delivery thereof by
the Indenture Trustee) constitutes a valid and
legally binding agreement of the Company, enforceable
against the Company in accordance with its terms,
except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting
creditors' rights generally or by general equitable
principles.
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(vii) The Indenture has been duly qualified
under the 1939 Act.
(viii) The Underwritten Securities being sold
pursuant to the applicable Terms Agreement and the
Indenture conform in all material respects to the
statements relating thereto contained in the
Prospectus and are in substantially the form filed or
incorporated by reference, as the case may be, as an
exhibit to the Registration Statement.
(ix) The statements in the Prospectus under
"Description of Debt Securities" and "Certain Federal
Income Tax Considerations" and in the Registration
Statement under Item 15, insofar as such statements
constitute a summary of documents referred to therein
or matters of law, are accurate summaries and fairly
and correctly present the information called for with
respect to such documents and matters.
(x) 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 described in the Registration Statement
or the Prospectus 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 are
fairly summarized in all material respects (except
that such counsel need express no opinion as to the
financial statements, schedules and other financial
information included or incorporated by reference
therein).
(xi) Such counsel knows of no material legal
proceedings pending or threatened against the Company.
(xii) 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 the Underwriting Agreement,
applicable Terms Agreement or the Indenture and the
consummation of the transactions therein contemplated
by the Company (other than as may be required by the
NASD or as required by State securities or Blue Sky
laws, as to which such counsel need express no
opinion) except such as have been obtained or made,
specifying the same.
(xiii) The investments of the Company described
in the Prospectus are permitted investments under the
Declaration of Trust.
(xiv) The Company has qualified to be taxed as
a real estate investment trust pursuant to Sections
856-860 of the Internal Revenue
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Code, as amended, for the fiscal years ended December
31, 1978 through December 31, 1995, and the Company's
present method of operation and its assets and
contemplated income are such that the Company is in a
position under present law to so qualify for the
fiscal year ending December 31, 1996, and under the
present law the federal income tax treatment of the
Company and its shareholders will be as set forth in
the Prospectus under the heading "Organization of the
Trust".
(xv) The Registration Statement has been
declared effective under the 1933 Act. Any required
filing of the Prospectus pursuant to Rule 424(b) has
been made in the manner and within the time period
required by Rule 424(b). To the best of such
counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been
issued under the 1993 Act and no proceedings for that
purpose have been initiated or are pending or
threatened by the Commission.
(xvi) The Registration Statement and the
Prospectus, excluding the documents incorporated by
reference therein, and each amendment or supplement
to the Registration Statement and Prospectus,
excluding the documents incorporated by reference
therein, as of their respective effective or issue
dates (other than the financial statements and
supporting schedules included therein or omitted
therefrom and the Indenture Trustee's Statement of
Eligibility on Form T-1 (the "Form T-1"), as to which
such counsel need express no opinion) complied as to
form in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations.
(xvii) The documents incorporated by reference
in the Prospectus (other than the financial
statements and supporting schedules therein or
omitted therefrom, as to which such counsel need
express no opinion), when they were filed with the
Commission, complied as to form in all material
respects with the requirements of the 1934 Act and
the rules and regulations of the Commission
thereunder.
(xviii) The Underwritten Securities, upon
issuance, will be excluded or exempted under, or
beyond the purview of, the Commodity Exchange Act, as
amended (the "Commodity Exchange Act"), and the rules
and regulations of the Commodity Futures Trading
Commission under the Commodity Exchange Act (the
"Commodity Exchange Act Regulations").
(xix) The Company is not an "investment
company" within the meaning of the Investment Company
Act of 1940, as amended (the "1940 Act").
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In rendering such opinion, Arent Fox Kintner Plotkin &
Kahn may rely as to matters governed by the laws of
jurisdictions other than the District of Columbia or Federal
laws on local counsel in such jurisdictions, provided that in
each case Arent Fox Kintner Plotkin & Kahn shall state that
they believe that they and the Underwriters are justified in
relying on such other counsel. In addition to the matters set
forth above, such opinion shall also include a statement to
the effect that nothing has come to the attention of such
counsel which leads them to believe that the Registration
Statement, as of the time it became effective under the 1933
Act or at the Representation Date, contained an untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus, at
the Representation Date or at Closing Time, 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 or incorporated by
reference therein). With respect to such statement, Arent Fox
Kintner Plotkin & Kahn may state that their belief is based
upon the procedures set forth therein, but is without
independent check and verification.
(2) The favorable opinion, dated as of Closing Time, of
Benjamin H. Dorsey, Esq., General Counsel and Secretary to the
Company, in form and substance satisfactory to counsel for the
Underwriters, to the effect that: (i) the Company is duly
qualified as a foreign corporation to transact business and is
in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership
or leasing of property or the conduct of business except where
the failure to so qualify or be in good standing would not
result in a Material Adverse Effect; (ii) each Subsidiary of
the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business,
except where the failure to so qualify or be in good standing
would not result in a Material Adverse Effect; (iii) the
authorized, issued and outstanding shares of beneficial
interest of the Company are as set forth in the Prospectus
under the caption "Capitalization"; such shares of beneficial
interest have been duly authorized and validly issued by the
Company and are fully paid and non-assessable and none of such
shares of beneficial interest was issued in violation of
preemptive or other similar rights of any securityholder of
the Company; (iv) the execution, delivery and performance of
the Underwriting Agreement, the applicable Terms Agreement and
the Indenture and the consummation of the transactions
contemplated therein and compliance by the Company with its
obligations thereunder do not and will not conflict with or
constitute a breach of any of the terms or provisions of, or
constitute a default
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under, (a) the declaration of trust, partnership agreement,
charter, by-laws, or other organizational document of the
Company or any of its subsidiaries, (b) any agreement or
instrument known to such counsel to which the Company or any
of its subsidiaries is a party or by which the Company or any
of its subsidiaries may be bound, or (c) any order, rule or
regulation known to such counsel of any court or government
agency or body having jurisdiction over the Company or any of
its subsidiaries or any of their properties; (v) to the best
of such counsel's knowledge, neither the Company nor any of
its subsidiaries is in violation of its declaration of trust,
partnership agreement, charter, by-laws or other
organizational document and the Company and each of its
subsidiaries is in compliance with all material rules,
regulations, judgments, decrees, orders and statutes in the
jurisdictions in which it is conducting its business; and (vi)
all pending legal or governmental proceedings to which the
Company or any of its subsidiaries is a party or to which any
of their property is subject which are not described in the
Registration Statement, including ordinary routine litigation
incidental to the business, are, considered in the aggregate,
not material.
(3) The favorable opinion, dated as of Closing Time, of
Andrews & Kurth L.L.P., counsel for the Underwriters, with
respect to the matters set forth in (iv), (v), (vi), (vii),
(viii), (ix) (only with respect to the statements set forth
under "Description of Debt Securities"), (xii), (xv) and (xvi)
of subsection (b)(l) of this Section. In addition to the
matters set forth above, such opinion shall also include a
statement to the effect that nothing has come to the attention
of such counsel which leads them to believe that the
Registration Statement, as of the time it became effective
under the 1933 Act or at the Representation Date, contained an
untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading or that the
Prospectus, at the Representation Date or at Closing Time,
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
or incorporated by reference therein). With respect to such
statement, Andrews & Kurth L.L.P. may state that their belief
is based upon the procedures set forth therein, but is without
independent check and verification.
(c) At Closing Time, there shall not have been, since the date
of the applicable Terms Agreement or since the respective dates as of
which information is given in the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business, and Merrill Lynch shall have received
a certificate of the President or a Vice President of
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the Company and of the chief financial officer or chief accounting
officer of the Company, dated as of Closing Time, to the effect that
(i) there has been no such material adverse change, (ii) the
representations and warranties in Section 1 are true and correct with
the same force and effect as though expressly made at and as of the
Closing Time, (iii) the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at
or prior to the Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been initiated or threatened by the
Commission.
(d) At the time of the execution of the applicable Terms
Agreement, Merrill Lynch shall have received from Price Waterhouse
L.L.P. a letter dated such date, in form and substance satisfactory to
Merrill Lynch, to the effect that (i) they are independent public
accountants with respect to the Company and its subsidiaries as
required by the 1933 Act and the 1934 Act and the applicable published
rules and regulations thereunder; (ii) it is their opinion that the
consolidated financial statements and supporting schedules of the
Company and its subsidiaries included or incorporated by reference in
the Registration Statement and covered by their opinions therein
comply as to form in all material respects with the applicable
accounting requirements of the 1933 Act and the 1934 Act and the
related published rules and regulations thereunder; (iii) based upon
limited procedures set forth in detail in such letter (which shall
include, without limitation, the procedures specified by the American
Institute of Certified Public Accountants for a review of interim
financial information as described in SAS No. 71, Interim Financial
Information, with respect to the unaudited condensed consolidated
financial statements of the Company and its subsidiaries included or
incorporated by reference in the Registration Statement), nothing has
come to their attention which causes them to believe that:
(1) any material modifications should be made to the
unaudited condensed consolidated financial statements included
or incorporated by reference in the Registration Statement for
them to be in conformity with generally accepted accounting
principles;
(2) the unaudited condensed consolidated
financial statements included or incorporated by reference in
the Registration Statement do not comply as to form in all
material respects with the applicable accounting requirements
of the 1933 Act and the 1934 Act as it applies to Form 10-Q
and the related published rules and regulations;
(3) at a specified date not more than three
days prior to the date of such letter, there was any change in
the capitalization of the Company and its subsidiaries, any
decrease in total assets, any change in long-term debt or any
change in short-term borrowings of the Company and its
subsidiaries, as
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compared with the amounts shown in the most recent
consolidated balance sheet incorporated by reference in the
Registration Statement; or
(4) during the period from the date of the most
recent consolidated balance sheet incorporated by reference in
the Registration Statement to a specified date not more than
three days prior to the date of such letter, there were any
decreases, as compared with the corresponding period in the
preceding year, in real estate rental revenue, net income or
net income per share of the Company and its subsidiaries;
except in all cases for changes, increases or decreases which the
Registration Statement discloses have occurred or may occur; (iv) in
addition to the limited procedures referred to in clause (iii) above,
they have carried out certain specified procedures, not constituting
an audit, with respect to certain amounts, percentages and financial
information which are derived from the general accounting records of
the Company and its subsidiaries, which are included or incorporated
by reference in the Registration Statement and which are specified by
Merrill Lynch, and have compared such amounts, percentages and
financial information with the accounting records of the Company and
its subsidiaries and have found them to be in agreement; and (v) they
have compared the information in the Prospectus under the caption
"Selected Financial Data" with the disclosure requirements of
Regulation S-K and on the basis of limited procedures specified in
such letter nothing came to their attention as a result of the
foregoing procedures that caused them to believe that this information
does not conform in all material respects with the disclosure
requirements of Item 301 of Regulation S-K.
(e) At Closing Time, Merrill Lynch shall have received from
Price Waterhouse L.L.P. a letter, dated as of Closing Time, to the
effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (d) of this Section 5, except that the
specified date referred to shall be a date not more than three
business days prior to the Closing Time.
(f) At Closing Time and at any relevant Date of Delivery, the
Underwritten Securities shall have the ratings accorded by any
"nationally recognized statistical rating organization", as defined by
the Commission for purposes of Rule 436(g)(2) of the 1933 Act
Regulations, if and as specified in the applicable Terms Agreement,
and the Company shall have delivered to Merrill Lynch a letter, dated
as of such date, from each such rating organization, or other evidence
satisfactory to Merrill Lynch, confirming that the Underwritten
Securities have such ratings. Since the time of execution of such
Terms Agreement, there shall not have occurred a downgrading in the
rating assigned to the Underwritten Securities or any of the Company's
other securities by any such rating organization, and no such rating
organization shall have publicly announced that it has under
surveillance or review its rating of the Underwritten Securities or
any of the Company's other securities.
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(g) At Closing Time, the Underwritten Securities shall have been
approved for listing, subject only to official notice of issuance, if
and as specified in the applicable Terms Agreement.
(h) If the Registration Statement or an offering of Underwritten
Securities has been filed with the NASD for review, the NASD shall not
have raised any objection with respect to the fairness and
reasonableness of the underwriting terms and arrangements.
(i) On the date of the applicable Terms Agreement, Merrill Lynch
shall have received, in form and substance satisfactory to it, each
lock-up agreement, if any, specified in such Terms Agreement as being
required to be delivered by the persons listed therein.
(j) In the event that the Underwriters are granted an
over-allotment option by the Company in the applicable Terms Agreement
and the Underwriters exercise their option to purchase all or any
portion of the Option Underwritten Securities, the representations and
warranties of the Company contained herein and the statements in any
certificates furnished by the Company or any of its subsidiaries
hereunder shall be true and correct as of each Date of Delivery, and,
at the relevant Date of Delivery, Merrill Lynch shall have received:
(1) A certificate, dated such Date of Delivery, of the
President or a Vice President of the Company and the chief
financial officer or chief accounting officer of the Company,
confirming that the certificate delivered at the Closing Time
pursuant to Section 5(c) hereof remains true and correct as of
such Date of Delivery.
(2) The favorable opinion of Arent Fox Kintner Plotkin &
Kahn, special counsel for the Company, together with the
favorable opinion of Benjamin H. Dorsey, Esq., General Counsel
and Secretary to the Company, each in form and substance
satisfactory to counsel for the Underwriters, dated such Date
of Delivery, relating to the Option Underwritten Securities
and otherwise to the same effect as the opinions required by
Section 5(b)(1) and 5(b)(2) hereof.
(3) The favorable opinion of Andrews & Kurth L.L.P.,
counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Underwritten Securities and otherwise
to the same effect as the opinion required by Section 5(b)(3)
hereof.
(4) A letter from Price Waterhouse L.L.P., in form and
substance satisfactory to Merrill Lynch and dated such Date of
Delivery, substantially in the same form and substance as the
letter furnished to Merrill Lynch pursuant to Section 5(e)
hereof, except that the "specified date" on the letter
furnished pursuant to this
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paragraph shall be a date not more than three business days
prior to such Date of Delivery.
(k) At Closing Time and at each Date of Delivery, counsel for
the Underwriters shall have been furnished with such documents and
opinions as they may require for the purpose of enabling them to pass
upon the issuance and sale of the Underwritten Securities as herein
contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company
in connection with the issuance and sale of the Underwritten
Securities as herein contemplated shall be satisfactory in form and
substance to Merrill Lynch and counsel for the Underwriters.
(l) If any condition specified in this Section 5 shall not have
been fulfilled when and as required to be fulfilled, the applicable
Terms Agreement (or, with respect to the Underwriters' exercise of any
applicable over-allotment option for the purchase of Option
Underwritten Securities on a Date of Delivery after the Closing Time,
the obligations of the Underwriters to purchase the Option
Underwritten Securities on such Date of Delivery) may be terminated by
Merrill Lynch by notice to the Company at any time at or prior to the
Closing Time (or such Date of Delivery, as applicable), and such
termination shall be without liability of any party to any other party
except as provided in Section 4 and except that Sections 1, 6, 7 and 8
shall survive any such termination and remain in full force and
effect.
SECTION 6. Indemnification.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(1) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information and the Rule 434 Information deemed to be a part
thereof, if applicable, or the omission or alleged omission therefrom
of a material fact required to be stated therein or necessary to make
the statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact included in
any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of
a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading;
(2) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any
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investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue
statement or omission; provided that (subject to Section 6(d) below)
any such settlement is effected with the written consent of the
Company; and
(3) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Merrill
Lynch), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through Merrill Lynch expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information deemed to be a part thereof, if applicable, or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, its trustees, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information deemed to be a part thereof, if
applicable, or any preliminary prospectus or the Prospectus (or any amendment
or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through Merrill Lynch
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(c) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure
to so notify an indemnifying party shall not relieve such indemnifying party
from any liability hereunder to the extent it is not materially prejudiced as a
result thereof and in any event shall not relieve it from any liability which
it may have otherwise than on account of this indemnity agreement. In the case
of parties indemnified pursuant to Section 6(a) above, counsel to the
indemnified parties shall be selected by Merrill Lynch, and, in the case of
parties indemnified pursuant to Section 6(b) above, counsel to the indemnified
parties shall be selected by the Company. An indemnifying party may
participate at its own expense in
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the defense of any such action; provided, however, that counsel to the
indemnifying party shall not (except with the consent of the indemnified party)
also be counsel to the indemnified party. In no event shall the indemnifying
parties be liable for fees and expenses of more than one counsel (in addition
to any local counsel) separate from their own counsel for all indemnified
parties in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall, without the prior written consent
of the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 or Section 7 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such settlement,
compromise or consent (i) includes an unconditional release of each indemnified
party from all liability arising out of such litigation, investigation,
proceeding or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act by or on behalf of any indemnified
party.
(d) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 6(a)(ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement
at least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
SECTION 7. Contribution. If the indemnification provided for in
Section 6 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and the Underwriters, on the other hand, from the
offering of the Underwritten Securities pursuant to the applicable Terms
Agreement or (ii) if the allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault
of the Company, on the one hand, and of the Underwriters, on the other hand, in
connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company, on the one hand, and
the Underwriters, on the other hand, in connection with the offering of the
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of such Underwritten Securities (before deducting expenses)
received by the Company and the total underwriting discount received by the
Underwriters, in
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each case as set forth on the cover of the Prospectus, or, if Rule 434 is used,
the corresponding location on the Term Sheet bear to the aggregate initial
public offering price of such Underwritten Securities as set forth on such
cover.
The relative fault of the Company, on the one hand, and the
Underwriters, on the other hand, shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 7. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 7 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged
untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Underwritten Securities underwritten by it and distributed
to the public were offered to the public exceeds the amount of any damages
which such Underwriter has otherwise been required to pay by reason of any such
untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the 1933 Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter,
and each trustee of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
shall have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the number or aggregate principal amount, as the case may be, of
Initial Underwritten Securities set forth opposite their respective names in
the applicable Terms Agreement, and not joint.
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SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Underwriting Agreement or the applicable Terms Agreement or in certificates of
officers of the Company submitted pursuant hereto or thereto shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of any Underwriter or controlling person, or by or on behalf of
the Company, and shall survive delivery of and payment for the Underwritten
Securities.
SECTION 9. Termination.
(a) This Underwriting Agreement (excluding the applicable Terms
Agreement) may be terminated for any reason at any time by the Company or by
Merrill Lynch upon the giving of 30 days' prior written notice of such
termination to the other party hereto.
(b) Terms Agreement. Merrill Lynch may terminate the applicable
Terms Agreement, by notice to the Company, at any time at or prior to the
Closing Time or any relevant Date of Delivery, if (i) there has been, since the
time of execution of such Terms Agreement or since the respective dates as of
which information is given in the Prospectus, any material adverse change in
the condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii)
there has occurred any material adverse change in the financial markets in the
United States or, if the Underwritten Securities are denominated or payable in,
or indexed to, one or more foreign or composite currencies, in the
international financial markets, or any outbreak of hostilities or escalation
thereof or other calamity or crisis or any change or development involving a
prospective change in national or international political, financial or
economic conditions, in each case the effect of which is such as to make it, in
the judgment of Merrill Lynch, impracticable to market the Underwritten
Securities or to enforce contracts for the sale of the Underwritten Securities,
or (iii) trading in any securities of the Company has been suspended or limited
by the Commission or the American Stock Exchange, or if trading generally on
the New York Stock Exchange or the American Stock Exchange or in the Nasdaq
National Market has been suspended or limited, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices have been required, by
either of said exchanges or by such system or by order of the Commission, the
NASD or any other governmental authority, or (iv) a banking moratorium has been
declared by either Federal or New York authorities or, if the Underwritten
Securities or any related Underlying Securities include Debt Securities
denominated or payable in, or indexed to, one or more foreign or composite
currencies, by the relevant authorities in the related foreign country or
countries.
(c) If this Underwriting Agreement or the applicable Terms Agreement
is terminated pursuant to this Section 9, such termination shall be without
liability of any party to any other party except as provided in Section 4
hereof, and provided further that Sections 1, 6, 7 and 8 shall survive such
termination and remain in full force and effect.
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SECTION 10. Default by One or More of the Underwriters. If one or
more of the Underwriters shall fail at the Closing Time or the relevant Date of
Delivery, as the case may be, to purchase the Underwritten Securities which it
or they are obligated to purchase under the applicable Terms Agreement (the
"Defaulted Securities"), then Merrill Lynch shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than
all, of the Defaulted Securities in such amounts as may be agreed upon and upon
the terms herein set forth; if, however, Merrill Lynch shall not have completed
such arrangements within such 24-hour period, then:
(a) if the aggregate principal amount of Defaulted Securities
does not exceed 10% of the aggregate principal amount of Underwritten
Securities to be purchased on such date pursuant to such Terms
Agreement, the non-defaulting Underwriters shall be obligated,
severally and not jointly, to purchase the full amount thereof in the
proportions that their respective underwriting obligations under such
Terms Agreement bear to the underwriting obligations of all
non-defaulting Underwriters, or
(b) if the aggregate principal amount of Defaulted Securities
exceeds 10% of the aggregate principal amount of Underwritten
Securities to be purchased on such date pursuant to such Terms
Agreement, such Terms Agreement (or, with respect to the Underwriters'
exercise of any applicable over-allotment option for the purchase of
Option Underwritten Securities on a Date of Delivery after the Closing
Time, the obligations of the Underwriters to purchase, and the Company
to sell, such Option Underwritten Securities on such Date of Delivery)
shall terminate without liability on the part of any non-defaulting
Underwriter.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in (i) a
termination of the applicable Terms Agreement or (ii) in the case of a Date of
Delivery after the Closing Time, a termination of the obligations of the
Underwriters and the Company with respect to the related Option Underwritten
Securities, as the case may be, either Merrill Lynch or the Company shall have
the right to postpone the Closing Time or the relevant Date of Delivery, as the
case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or the Prospectus or in any
other documents or arrangements.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to Merrill Lynch at World Financial Center,
North Tower, New York, New York 10281-1201, attention of Tjarda V.S. Clagett,
Director; and notices to the Company shall be directed to it at 10400
Connecticut
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Avenue, Kensington, Maryland 20895, attention of Larry E. Finger, Senior Vice
President and Chief Financial Officer.
SECTION 12. Parties. This Underwriting Agreement and the applicable
Terms Agreement shall each inure to the benefit of and be binding upon the
Company, Merrill Lynch and, upon execution of such Terms Agreement, any other
Underwriters and their respective successors. Nothing expressed or mentioned
in this Underwriting Agreement or such Terms Agreement is intended or shall be
construed to give any person, firm or corporation, other than the Underwriters
and the Company and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their heirs and
legal representatives, any legal or equitable right, remedy or claim under or
in respect of this Underwriting Agreement or such Terms Agreement or any
provision herein or therein contained. This Underwriting Agreement and such
Terms Agreement and all conditions and provisions hereof and thereof are
intended to be for the sole and exclusive benefit of the parties hereto and
thereto and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Underwritten
Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS UNDERWRITING AGREEMENT AND
ANY APPLICABLE TERMS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK. EXCEPT AS OTHERWISE SET FORTH HEREIN,
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Article and Section headings
herein are for convenience only and shall not affect the construction hereof.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this Underwriting Agreement, along with all counterparts, will become
a binding agreement between Merrill Lynch and the Company in accordance with
its terms.
Very truly yours,
WASHINGTON REAL ESTATE
INVESTMENT TRUST
By:
------------------------------
Name:
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Title:
CONFIRMED AND ACCEPTED,
as of the date first
above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By:
-------------------------------------
Authorized Signatory
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Exhibit A
WASHINGTON REAL ESTATE INVESTMENT TRUST
(a District of Columbia business trust)
[Title of Securities]
TERMS AGREEMENT
___________, 199__
To: Washington Real Estate Investment Trust
10400 Connecticut Avenue
Kensington, Maryland 20895
Attention: Mr. Larry E. Finger
Senior Vice President and Chief Financial Officer
Ladies and Gentlemen:
We understand that Washington Real Estate Investment Trust (the
"Company"), proposes to issue and sell $_________ aggregate principal amount of
its debt securities (the "Debt Securities") ([such securities also being
hereinafter referred to as] the "[Initial] Underwritten Securities"). Subject
to the terms and conditions set forth or incorporated by reference herein, we
[the underwriters named below (the "Underwriters")] offer to purchase [,
severally and not jointly,] the principal amount of Underwritten Securities
[opposite their names set forth below] at the purchase price set forth below [,
and a proportionate share of Option Underwritten Securities set forth below, to
the extent any are purchased].
A-1
34
Principal Amount
Underwriter of [Initial] Underwritten Securities
- ----------- ------------------------------------
----------------
Total [$]
===============
The Underwritten Securities shall have the following terms:
[Debt Securities]
Title:
Ratings:
Aggregate principal amount:
Denominations:
Currency of payment:
Interest rate or formula:
Interest payment dates:
Regular record dates:
Stated maturity date:
Redemption provisions:
Sinking fund requirements:
Listing requirements:
Black-out provisions:
Fixed or Variable Price Offering: [Fixed] [Variable] Price Offering
If Fixed Price Offering, initial public offering price per share:
% of the principal amount, plus accrued interest [amortized original
issue discount], if any, from _________________.
Purchase price per share: ___% of principal amount, plus accrued interest
[amortized original issue discount], if any, from
_________________.
Form:
Other terms and conditions:
Closing date and location:
All of the provisions contained in the document attached as Annex I
hereto entitled "Washington Real Estate Investment Trust--Debt
Securities--Underwriting Agreement" are hereby incorporated by reference in
their entirety herein and shall be deemed to be a part of this Terms Agreement
to the same extent as if such provisions had been set forth in full herein.
Terms defined in such document are used herein as therein defined.
A-2
35
Please accept this offer no later than ____ o'clock P.M. (New York City
time) on ______________ by signing a copy of this Terms Agreement in the space
set forth below and returning the signed copy to us.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By
----------------------------
Authorized Signatory
[Acting on behalf of itself and the other named Underwriters.]
Accepted:
WASHINGTON REAL ESTATE INVESTMENT TRUST
By
-------------------------
Name:
Title:
A-3