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POST APARTMENT HOMES, L.P.
(a Georgia limited partnership)
Debt Securities
PURCHASE AGREEMENT
March 7, 2001
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower, 10th Floor
World Financial Center
250 Vesey Street
New York, New York 10281-1310
Ladies and Gentlemen:
Post Apartment Homes, L.P., a Georgia limited partnership (the
"Operating Partnership"), proposes to issue and sell up to $500,000,000
aggregate initial public offering price of its unsecured non-convertible debt
securities (the "Securities") in principal amounts, at prices and on terms to be
determined at the time of offering. The Securities will be issued in one or more
series under one or more indentures (each, an "Indenture"), between the
Operating Partnership and a trustee (a "Trustee"). Each series of Securities may
vary, as applicable, as to title, aggregate principal amount, rank, 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 applicable Indenture. Unless the context
otherwise requires, as used herein, "you" and "your" shall mean the parties to
whom this Agreement is addressed together with the other parties, if any,
identified in the applicable Terms Agreement (as hereinafter defined) as
additional co-managers with respect to Underwritten Securities (as hereinafter
defined) purchased pursuant thereto.
Whenever the Operating Partnership determines to make an offering of
Securities through you, or through an underwriting syndicate managed by you, the
Operating Partnership will enter into an agreement (each a "Terms Agreement")
providing for the sale of such Securities (the "Underwritten Securities") to,
and the purchase and offering thereof by, you and such other underwriters, if
any, selected by you (the "Underwriters," which term shall include you, 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
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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 you 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 and any other material variable terms of
the Initial Underwritten Securities (including, but not limited to, current
ratings, designations, denominations, interest rates or formulas, interest
payment dates, maturity dates and repayment provisions). In addition, if
applicable, such Terms Agreement shall specify whether the Operating Partnership
has agreed to grant to the Underwriters an option to purchase additional
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 you and the Operating Partnership.
Each offering of Underwritten Securities through you as sole Underwriter or
through an underwriting syndicate managed by you will be governed by this
Agreement, as supplemented by the applicable Terms Agreement, and such Terms
Agreement shall inure to the benefit of and be binding upon each Underwriter
participating in the offering of such Underwritten Securities.
Post Properties, Inc., a Georgia corporation (the "Company"), and the
Operating Partnership have filed with the Securities and Exchange Commission
(the "Commission") registration statements on Form S-3 (Nos. 333-36595,
333-42844 and 333-55994) for the registration of, among other securities, the
Securities under the Securities Act of 1933, as amended (the "1933 Act"), and
the offering thereof from time to time in accordance with Rule 430A or Rule 415
of the rules and regulations of the Commission under the 1933 Act (the "1933 Act
Regulations"), and the Company and the Operating Partnership have filed such
amendments thereto as may have been required prior to the execution of the
applicable Terms Agreement. Each such registration statement has been declared
effective by the Commission and an Indenture has been qualified under the Trust
Indenture Act of 1939, as amended (the "1939 Act"). Each such registration
statement and the prospectus constituting a part thereof (including in each case
the information, if any, deemed to be part thereof pursuant to Rule 430A(b) of
the 1933 Act Regulations, and each prospectus supplement relating to the
offering of Underwritten Securities pursuant to Rule 430A or Rule 415 of the
1933 Act Regulations (the "Prospectus Supplement"), including all documents
incorporated therein by reference, as from time to time amended or supplemented
pursuant to
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the 1933 Act, the Securities Exchange Act of 1934, as amended (the "1934 Act"),
or otherwise), are collectively referred to herein as the "Registration
Statement" and the "Prospectus," respectively; provided, that if any revised
Prospectus shall be provided to you by the Operating Partnership for use in
connection with the offering of Underwritten Securities which differs from the
Prospectus on file at the Commission at the time the Registration Statement
became effective (whether or not such revised prospectus is required to be filed
by the Company or the Operating Partnership pursuant to Rule 424(b) of the 1933
Act Regulations), the term "Prospectus" shall refer to each such revised
prospectus from and after the time it is first provided to you for such use;
provided, further, that a Prospectus Supplement shall be deemed to have
supplemented the Prospectus only with respect to the offering of Underwritten
Securities to which it relates. Any registration statement (including any
supplement thereto or information which is deemed part thereof) filed by the
Operating Partnership under Rule 462(b) of the 1933 Act Regulations (a "Rule
462(b) Registration Statement") shall be deemed to be part of the Registration
Statement. Any prospectus (including any amendment or supplement thereto or
information which is deemed part thereof) included in the Rule 462(b)
Registration Statement and any term sheet as contemplated by Rule 434 of the
1933 Act Regulations (a "Term Sheet") shall be deemed to be part of the
Prospectus. All references in this Agreement to financial statements and
schedules and other information which is "contained," "included" or "stated" in
the Registration Statement or the Prospectus (and all other references of like
import) shall be deemed to mean and include all such financial statements and
schedules and other information which is or is deemed to be incorporated by
reference in the Registration Statement or the Prospectus, as the case may be;
and all references in this Agreement to amendments or supplements to the
Registration Statement or the Prospectus shall be deemed to mean and include the
filing of any document under the 1934 Act which is or is deemed to be
incorporated by reference in the Registration Statement or the Prospectus, as
the case may be. For purposes of this Agreement, all references to the
Registration Statement, any preliminary prospectus, preliminary prospectus
supplement, Prospectus or Prospectus Supplement or any Term Sheet or any
amendment or supplement to the foregoing shall be deemed to include the copy
filed with the Commission pursuant to its Electronic Data Gathering, Analysis
and Retrieval system ("EDGAR").
The term "Subsidiary" as used herein means a corporation or a
partnership a majority of the outstanding equity interests, as the case may be,
of which is owned or controlled, directly or indirectly, by the Company or the
Operating Partnership, as the case may be, or by one or more other Subsidiaries
of the Company or the Operating Partnership.
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SECTION 1. Representations and Warranties of the Operating Partnership.
(a) The Operating Partnership represents and warrants to you, as of the
date hereof, and to you and each other 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 Operating Partnership meets the requirements for use
of Form S-3 under the 1933 Act. Each of the Registration Statement, the
Prospectus and any Rule 462(b) Registration Statement has become
effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any part thereof has
been issued under the 1933 Act and no proceeding for that purpose has
been instituted or is pending or, to the knowledge of the Operating
Partnership, is contemplated or threatened by the Commission or by the
state securities authority of any jurisdiction, 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. No order preventing or suspending the use of the Prospectus has
been issued and no proceeding for that purpose has been instituted or,
to the knowledge of the Operating Partnership, threatened by the
Commission or by the state securities authority of any jurisdiction.
(2) The Registration Statement, at the time it became
effective, complied, and the Registration Statement and the Prospectus,
at each Representation Date 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"). The Registration Statement, at the
time it became effective, did not, and as of each Representation Date
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 Representation Date, the
Prospectus and any amendments and supplements thereto (unless the term
"Prospectus" refers to a prospectus which has been provided to you by
the Operating Partnership for use in connection with an offering of
Underwritten Securities which differs from the Prospectus on file at
the Commission at the time the Registration Statement became effective,
in which case at the time it is first provided to you for such use) did
not and will not
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contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading.
If the Operating Partnership elects to rely upon Rule 434 of the 1933
Act Regulations, the Operating Partnership 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 Operating Partnership in writing by any Underwriter
through you expressly for use in the Registration Statement or the
Prospectus or to that part of the Registration Statement which shall
constitute the Statement of Eligibility and Qualification on Form T-1
under the 1939 Act (the "Statement of Eligibility") of the Trustee
under the Indenture. If a Rule 462(b) Registration Statement is
required in connection with the offering and sale of the Underwritten
Securities, the Operating Partnership has complied or will comply with
the requirements of Rule 111 of the 1933 Act Regulations relating to
the payment of filing fees therefor.
(3) Each preliminary prospectus, preliminary prospectus
supplement and Prospectus Supplement filed as part of the Registration
Statement at the time the Registration Statement became effective 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, if applicable, 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 the electronically transmitted copies thereof
filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
(4) The documents incorporated or deemed to be incorporated by
reference in 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 Prospectus,
at the time the Registration Statement became effective and as of each
Representation Date or during the period specified in Section 3(f), did
not and will not include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading.
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(5) The accounting firm that certified the financial
statements and supporting schedules included in, or incorporated by
reference into, the Registration Statement and the Prospectus, is an
independent public accountant as required by the 1933 Act and the 1933
Act Regulations.
(6) The consolidated financial statements of the Company and
the Operating Partnership incorporated by reference into 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, the Operating Partnership and their
consolidated subsidiaries, or such other entities, as the case may be,
at the respective dates indicated and the statement of operations,
stockholders' equity, partners' equity, and cash flows of the Company,
the Operating Partnership and their consolidated subsidiaries, or such
other entities, 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, or incorporated by reference into, the Registration
Statement and the Prospectus present fairly the information required to
be stated therein. The selected financial data and the summary
financial information included in, or incorporated by reference into,
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, or incorporated by reference into, the
Registration Statement and the Prospectus. The Company's and the
Operating Partnership's ratios of earnings to fixed charges and to
fixed charges and preferred stock dividends (actual and, if any, pro
forma) included in the Prospectus under the captions "Ratios of
Earnings to Fixed Charges and to Fixed Charges and Preferred Stock
Dividends" and in Exhibits 12.1 and 12.2 to the Registration Statement
have been calculated in compliance with Item 503(d) of Regulation S-K
of the Commission. In addition, any pro forma financial statements
included in, or incorporated by reference into, the Registration
Statement and the Prospectus comply in all material respects with the
applicable requirements of Rule 11-02 of Regulation S-X of the
Commission, and the assumptions used in the preparation thereof are, in
the opinion of the Operating Partnership, reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein and have been
properly applied to the historical amounts in the compilation of such
statements. Other than the historical financial statements (and
schedules) included therein, no other historical or pro forma financial
statements (or
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schedules) are required by the 1933 Act or the 1933 Act Regulations to
be included in the Registration Statement.
(7) 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, assets,
business affairs or business prospects of the Operating Partnership and
its Subsidiaries considered as one enterprise (a "Material Adverse
Effect"), whether or not arising in the ordinary course of business;
(B) no casualty loss or condemnation or other adverse event with
respect to any of the interests held directly or indirectly in any of
the real properties owned, directly or indirectly, by the Operating
Partnership or its Subsidiaries (the "Properties") has occurred that is
material to the Operating Partnership and its Subsidiaries considered
as one enterprise; (C) there have been no transactions entered into by
the Operating Partnership or any Subsidiary, other than those arising
in the ordinary course of business, which are material with respect to
the Operating Partnership and its Subsidiaries considered as one
enterprise or that would result, upon consummation, in any material
inaccuracy in the representations contained in Section 1(a)(6) above;
(D) neither the Operating Partnership nor any Subsidiary has incurred
any material obligation or liability, direct, contingent or otherwise
other than in the ordinary course of business; and (E) there has been
no material change in the short-term debt or long-term debt of the
Operating Partnership.
(8) The Operating Partnership has been duly formed and is
validly existing as a limited partnership in good standing under the
Georgia Revised Uniform Limited Partnership Act (the "Georgia Act")
with partnership power and authority to own, lease and operate its
properties, to conduct the business in which it is engaged and to enter
into and perform its obligations under this Agreement, the Terms
Agreement and the other agreements to which it is a party. The
Operating Partnership is duly qualified or registered as a foreign
partnership and is in good standing in each jurisdiction in which such
qualification or registration is required, whether by reason of the
ownership, leasing or management of property or the conduct of
business, except where the failure to so qualify or register would not
have a Material Adverse Effect.
(9) Each of the Significant Subsidiaries has been duly formed
and is validly existing and in good standing under the laws of its
jurisdiction of organization with partnership or corporate power and
authority to conduct the business in which it is engaged and to own,
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lease and operate its properties as described in the Prospectus and to
enter into and perform its obligations under any agreements to which it
is a party. Each of the Significant Subsidiaries is duly qualified as a
foreign partnership, corporation or other organization 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, the management of properties by others or the
conduct of business, except where the failure to so qualify would not
have a Material Adverse Effect.
(10) All of the issued and outstanding shares of capital stock
and partnership interests, as the case may be, of each Significant
Subsidiary have been validly issued and fully paid and are owned by the
Operating Partnership, the Company, another Significant Subsidiary,
and/or certain affiliated entities as described in the Registration
Statement, in each case free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity, other than the
transfer restrictions set forth in the Option and Transfer Agreement by
and among the Operating Partnership, Post Services, Inc., John A.
Williams and John T. Glover.
(11) The Operating Partnership has full power and authority to
enter into and perform its obligations under this Agreement and the
applicable Terms Agreement and this Agreement has been, and as of each
Representation Date, the applicable Terms Agreement will have been,
duly authorized, executed and delivered by the Operating Partnership
and, assuming due authorization, execution and delivery by the other
parties thereto, each is a valid and binding agreement of the Operating
Partnership enforceable against the Operating Partnership in accordance
with its terms, except as (A) the enforceability thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally, (B) the availability of
equitable remedies may be limited by equitable principles of general
applicability, and (C) rights to indemnity and contribution thereunder
may be limited by state or federal securities laws or the public policy
underlying such laws.
(12) The Indenture (A) has been duly and validly authorized,
and when executed and delivered by the Operating Partnership, and
assuming due authorization, execution and delivery by the trustee, does
constitute a valid and binding obligation of the Operating Partnership,
enforceable against the Operating Partnership in accordance with its
terms, subject to (i) applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or similar laws
affecting creditors' rights generally and (ii) general principles of
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equity (regardless of whether such enforceability is considered in a
proceeding at law or in equity and except the effect on enforceability
of (a) requirements that a claim with respect to any Underwritten
Securities payable 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) federal or state law limiting,
delaying or prohibiting the making of payments outside the United
States); and (B) conforms in all material respects to the description
thereof in the Prospectus.
(13) The Underwritten Securities have been, or as of the date
of the applicable Terms Agreement will have been, duly authorized by
the Operating Partnership for offer, sale, issuance and delivery
pursuant to this Agreement and such Terms Agreement. Such Underwritten
Securities, when issued and authenticated in the manner provided for in
the applicable Indenture and delivered against payment of the
consideration therefor specified in such Terms Agreement, will
constitute valid and legally binding obligations of the Operating
Partnership, entitled to the benefits of the Indenture enforceable
against the Operating Partnership in accordance with its terms, subject
to (i) applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer or similar laws affecting creditors' rights
generally and (ii) general principles of equity (regardless of whether
such enforceability is considered in a proceeding at law or in equity
and except the effect on enforceability of (a) requirements that a
claim with respect to any Underwritten Securities payable 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)
federal or state law limiting, delaying or prohibiting 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 applicable Indenture. Upon payment of
the purchase price and delivery of such Underwritten Securities in
accordance herewith, each of the Underwriters will receive good, valid
and marketable title to such Underwritten Securities, free and clear of
all security interests, mortgages, pledges, liens, encumbrances, claims
and equities. The terms of such applicable Underwritten Securities
conform in all material respects to all statements and descriptions
related thereto contained in the Prospectus. Such Underwritten
Securities rank and will rank on a parity with all unsecured and
unsubordinated indebtedness of the Operating Partnership that is
outstanding on the Delivery Date or that may be incurred thereafter,
except that such Underwritten Securities will be effectively
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subordinated to the prior claims of each secured mortgage lender to any
specific Property which secures such lender's mortgage.
(14) Neither the Operating Partnership nor any of its
Subsidiaries is in violation of its charter, by-laws, certificate of
limited partnership, partnership agreement or LLC agreement, as the
case may be, 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 it or any of them is a
party or by which any of them may be bound, or to which any of their
property or assets is subject, except for such defaults that could not
result in a Material Adverse Effect. The execution, delivery and
performance of this Agreement or the applicable Terms Agreement or each
applicable Indenture and the transactions contemplated herein or
therein, including the issuance, sale and delivery of the Underwritten
Securities and the use of the proceeds from the sale of the
Underwritten Securities as described in the Prospectus under the
caption "Use of Proceeds," and compliance by the Operating Partnership
with its obligations hereunder and thereunder, (A) 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 or Repayment
Event (as defined below) under, or result in the creation or imposition
of any lien, charge or encumbrance upon any assets, properties or
operations of the Operating Partnership or any of its Subsidiaries
pursuant to, any material contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other agreement or instrument
to which the Operating Partnership or any of its Subsidiaries is a
party or by which it or any of them may be bound, or to which any of
their properties or assets is subject, nor (B) will such action result
in any violation of the provisions of the (i) charter, bylaws, LLC
agreement or partnership agreement of the Operating Partnership or any
Subsidiary, as the case may be, or (ii) any applicable law, statute,
rule, regulation, judgment, order, writ or decree of any government,
government agency or court, domestic or foreign, having jurisdiction
over the Operating Partnership or any Subsidiary or any of their
assets, properties or operations, except any violation that could not
result in a Material Adverse Effect. As used herein, a "Repayment
Event" means any event or condition which gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on
such holder's behalf) the right to require the repurchase, redemption
or repayment of all or a portion of such indebtedness by the Operating
Partnership or any Subsidiary.
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(15) No labor dispute with the employees of the Company, the
Operating Partnership or any Subsidiary exists or, to the knowledge of
the Operating Partnership, is imminent, which may result in a Material
Adverse Effect.
(16) There is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now pending,
or to the knowledge of the Operating Partnership threatened against or
affecting the Operating Partnership, any Subsidiary thereof, any
Property or any officer or director of the foregoing, which is required
to be disclosed in the Registration Statement and the Prospectus (other
than as stated therein), or which could reasonably be expected to
result in a Material Adverse Effect, or which might materially and
adversely affect the consummation of this Agreement, the applicable
Terms Agreement or any applicable Indenture or the transactions
contemplated herein or therein or the performance by the Operating
Partnership of its obligations under this Agreement, the applicable
Indenture or the Underwritten Securities. There is no pending legal or
governmental proceedings to which the Operating Partnership or any
Subsidiary is a party or of which any of their respective assets or
properties is subject which might result in a Material Adverse Effect.
(17) There are no contracts or documents of the Company or the
Operating Partnership 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/or filed as required.
(18) No authorization, approval or consent of any court or
governmental authority or agency is necessary or required for the
performance by the Operating Partnership of its obligations under this
Agreement, the applicable Terms Agreement or any applicable Indenture
or in connection with the transactions contemplated under this
Agreement, such Terms Agreement or any applicable Indenture, except
such as have been already obtained or as may be required under the 1933
Act, the 1939 Act, the 1933 Act Regulations or state securities or real
estate syndication laws or the rules of the National Association of
Securities Dealers, Inc. ("NASD").
(19) The Operating Partnership and its Subsidiaries own or
possess, trademarks, service marks, trade names or other intellectual
property (collectively, "Intellectual Property") necessary to carry on
the business now operated by them, and neither the Operating
Partnership nor any of its Subsidiaries has received any notice or is
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otherwise aware of any infringement of or conflict with asserted rights
of others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Operating Partnership or any
of its Subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would result in a Material
Adverse Effect.
(20) Each of the Operating Partnership and its Subsidiaries
has all permits, licenses, approvals, consents, certificates and other
authorizations of and from (collectively, "Governmental Licenses") and
has made all declarations and filings with all appropriate federal,
state, local, foreign and other governmental authorities, all self
regulatory organizations and all courts and other tribunals required
for it to own, lease, license and use its properties and assets and to
conduct its business in the manner described in the Registration
Statement and the Prospectus, other than such Governmental Licenses the
absence of which, singly or in the aggregate, could be reasonably
expected to result in a Material Adverse Effect. Neither the Operating
Partnership nor any of its Subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such
Governmental Licenses which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, could be reasonably
expected to result in a Material Adverse Effect.
(21) (A) Except as otherwise set forth in the Registration
Statement or Prospectus, the Operating Partnership and its Subsidiaries
directly or indirectly hold good and marketable title to the real
property and improvements comprising the Properties (which title is, as
applicable, in the form of fee simple title to land, air rights or
condominium units, or leasehold title to land, air rights or
condominium units) and also holds good title to all other assets that
are required for the effective operation of such Properties in the
manner in which they currently are operated, subject, however, to
mortgages on such Properties, to leases of certain equipment and other
personal property, to utility easements serving such Properties, to
liens of ad valorem taxes not due and payable as of the Closing Time,
to zoning and similar governmental land use matters affecting such
Properties that are consistent with the current uses of such
Properties, to matters of title not adversely affecting marketability
of title to such Properties, other statutory liens not due and payable
as of the Closing Time, title matters that may be material in
character, amount or extent but which do not materially detract from
the value, or interfere with the use of, the Properties or otherwise
materially impair the
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business operations being conducted or proposed to be conducted
thereon, ownership of cable television and other telecommunication
lines and facilities serving one or more of such Properties by the
cable television and other telecommunication providers or their
affiliates, service marks and trade names used in connection with such
Properties, and ownership by others of certain items of equipment and
other items of personal property that are not material to the conduct
of business operations at such Properties; (B) the ground lease under
which the Operating Partnership leases the land or air rights on which
any Property is located is in full force and effect, and the Operating
Partnership is not in default in respect of any of the terms or
provisions of any such lease and the Operating Partnership has not
received notice of the assertion of any claim by anyone adverse to the
Operating Partnership's rights as lessee under any such lease, or
affecting or questioning the Operating Partnership's right to the
continued possession or use of the Property under any such lease or of
a default under any such lease, other than claims which would not have
a Material Adverse Effect; (C) all liens, charges, encumbrances,
claims, or restrictions on or affecting any of the Properties and the
assets of the Operating Partnership or any Subsidiary which are
required to be disclosed in the Prospectus are disclosed therein; (D)
none of the Operating Partnership or any tenant of any of the
Properties is in default under any of the leases pursuant to which the
Operating Partnership, as lessor, leases its Property (and the
Operating Partnership does not know of any event which, but for the
passage of time or the giving of notice, or both, would constitute a
default under any of such leases) other than such defaults that would
not have a Material Adverse Effect; (E) except as otherwise set forth
in the Registration Statement or Prospectus, to the extent entered into
in the ordinary course of business or to the extent not material to the
Operating Partnership, no person has an option or right of first
refusal to purchase all or part of any Property or any interest
therein; (F) each of the Properties complies with all applicable codes,
laws and regulations (including, without limitation, building and
zoning codes, laws and regulations and laws relating to access to the
Properties), except to the extent disclosed in the Prospectus and
except for such failures to comply that would not individually or in
the aggregate have a Material Adverse Effect; (G) the Operating
Partnership does not have knowledge of any pending or threatened
condemnation proceedings, zoning change, or other similar proceeding or
action that will in any manner affect the size of, use of, improvements
on, construction on or access to the Properties, except such
proceedings or actions that would not have a Material Adverse Effect;
and (H) other than with respect to the Property known as "Post Woods,"
and in the case of certain properties acquired in the merger with
Columbus
- 13 -
14
Realty Trust, the Operating Partnership and its Subsidiaries are the
beneficiaries of title insurance on the Properties in amounts that were
commercially reasonable at the time such policies were issued, and in
each case such title insurance is in full force and effect, except to
the extent the failure to obtain such title insurance or to keep such
title insurance in force would not have a Material Adverse Effect.
(22) The Operating Partnership 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"), or is
or will become a "holding company" or a "subsidiary company" of a
"registered holding company," as defined in the Public Utility Holding
Company Act of 1935, as amended.
(23) Except as disclosed in the Prospectus, (A) each Property,
including, without limitation, the Environment (as defined below)
associated with each Property, is free of any Hazardous Substance (as
defined below) in violation of any Environmental Law (as defined below)
applicable to the Properties, except for any Hazardous Substance that
would not have any Material Adverse Effect; (B) neither the Operating
Partnership nor any Subsidiary has caused or suffered to occur any
Release (as defined below) of any Hazardous Substance into the
Environment on, in, under or from any Property in violation of any
Environmental Law applicable to such Property, and no condition exists
on, in or under any Property or, to the knowledge of the Operating
Partnership, any property adjacent to any Property that could result in
the occurrence of liabilities under, or any violations of, any
Environmental Law applicable to such Property, give rise to the
imposition of any Lien (as defined below) under any Environmental Law,
or cause or constitute a health, safety or environmental hazard to any
property, person or entity, except any violation which would not be
reasonably likely to result in a Material Adverse Effect; (C) neither
the Operating Partnership nor any Subsidiary is engaged in or intends
to engage in any manufacturing or any similar operations at any
Property that (1) require the use, handling, transportation, storage,
treatment or disposal of any Hazardous Substance (other than paints,
stains, cleaning solvents, insecticides, herbicides, or other
substances that are used in the ordinary course of operating any
Property and in compliance with all applicable Environmental Laws) or
(2) require permits or are otherwise regulated pursuant to any
Environmental Law; (D) except as otherwise set forth in the
Registration Statement or Prospectus, neither the Operating Partnership
nor any Subsidiary has received any notice of a claim under or pursuant
to any Environmental
- 14 -
15
Law applicable to a Property or under common law pertaining to
Hazardous Substances on any Property or pertaining to other property at
which Hazardous Substances generated at any Property have come to be
located which could be reasonably likely to result in a Material
Adverse Effect; (E) except as otherwise set forth in the Registration
Statement or Prospectus, neither the Operating Partnership nor any
Subsidiary has received any notice from any Governmental Authority (as
defined below) claiming any violation of any Environmental Law that is
uncured or unremediated as of the date hereof which could reasonably be
likely to result in a Material Adverse Effect; and (F) except as
otherwise set forth in the Registration Statement or Prospectus, no
Property (1) is included or, to the knowledge of the Operating
Partnership or any Subsidiary, proposed for inclusion on the National
Priorities List issued pursuant to CERCLA (as defined below) by the
United States Environmental Protection Agency (the "EPA") or on the
Comprehensive Environmental Response, Compensation, and Liability
Information System database maintained by the EPA as a potential CERCLA
removal, remedial or response site or (2) is included or proposed for
inclusion on, any similar list of potentially contaminated sites
pursuant to any other applicable Environmental Law nor has the
Operating Partnership, or any subsidiary received any written notice
from the EPA or any other Governmental Authority proposing the
inclusion of any Property on such list.
As used herein, "Hazardous Substance" shall include, without
limitation, any hazardous substance, hazardous waste, toxic or
dangerous substance, pollutant, solid waste or similarly designated
materials, including, without limitation, oil, petroleum, or any
petroleum-derived substance or waste, asbestos or asbestos-containing
materials, PCBs, pesticides, explosives, radioactive materials,
dioxins, urea formaldehyde insulation or any constituent of any such
substance, pollutant or waste, including any such substance, pollutant
or waste identified, listed or regulated under any Environmental Law
(including, without limitation, materials listed in the United States
Department of Transportation Optional Hazardous Material Table, 49
C.F.R. ss. 172.101, as the same may now or hereafter be amended, or in
the EPA's List of Hazardous Substances and Reportable Quantities, 40
C.F.R. Part 3202, as the same may now or hereafter be amended);
"Environment" shall mean any surface water, drinking water, ground
water, land surface, subsurface strata, river sediment, buildings,
structures, and ambient, workplace and indoor air; "Environmental Law"
shall mean the Comprehensive Environmental Response, Compensation and
Liability Act, as amended (42 U.S.C. ss. 9601, et seq.) ("CERCLA"), the
Resource Conservation Recovery Act, as amended (42 U.S.C. ss. 6901, et
seq.), the Clean Air Act, as amended (42
- 15 -
16
U.S.C. ss. 7401, et seq.), the Clean Water Act, as amended (33 U.S.C.
ss. 1251, et seq.), the Toxic Substances Control Act, as amended (15
U.S.C. ss. 2601 et seq.), the Occupational Safety and Health Act of
1970, as amended (29 U.S.C. ss. 651, et seq.), the Hazardous Materials
Transportation Act, as amended (49 U.S.C. ss. 1801, et seq.), together
with all rules, regulations and orders promulgated thereunder and all
other federal, state and local laws, ordinances, rules, regulations and
orders relating to the protection of the environment or of human health
from environmental effects; "Governmental Authority" shall mean any
federal, state or local governmental office, agency or authority having
the duty or authority to promulgate, implement or enforce any
Environmental Law; "Lien" shall mean, with respect to any Property, any
material mortgage, deed of trust, pledge, security interest, lien,
encumbrance, penalty, fine, charge, assessment, judgment or other
liability in, on or affecting such Property; and "Release" shall mean
any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping, emanating or
disposing of any Hazardous Substance into the Environment including,
without limitation, the abandonment or discard of barrels, containers,
tanks (including, without limitation, underground storage tanks) or
other receptacles containing or previously containing any Hazardous
Substance or any release, emission, discharge or similar term, as those
terms are defined or used in any Environmental Law.
(24) Each of the Operating Partnership and its Subsidiaries is
insured by insurers of recognized financial responsibility against such
losses and risks and in such amounts as are prudent and customary in
the businesses in which they are engaged.
(25) The assets of the Operating Partnership do not constitute
"plan assets" under the Employee Retirement Income Security Act of
1974, as amended.
(26) Except as otherwise set forth in the Registration
Statement or Prospectus, the mortgages and deeds of trust encumbering
the properties and assets are not convertible and are not
cross-defaulted or cross-collateralized to any property not owned by
the Operating Partnership or any of its Subsidiaries; except as
otherwise disclosed in the Registration Statement or Prospectus, none
of the Operating Partnership or any of its Subsidiaries holds
participating interests in such mortgages and deeds of trust.
(27) The partnership agreement of the Operating Partnership
(the "Operating Partnership Agreement") has been duly authorized,
- 16 -
17
executed and delivered by the parties thereto and constitutes the valid
agreement thereof, enforceable in accordance with its terms, except as
(A) the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally and (B) the availability of equitable
remedies may be limited by equitable principles of general
applicability; and the execution, delivery and performance of the
Operating Partnership Agreement did not, at the time of execution and
delivery, and does not constitute a breach of, or default under any
material contract, lease or other instrument to which the Operating
Partnership is a party or by which its properties may be bound or any
law, administrative regulation or administrative or court decree.
(28) The Company was organized and has operated in conformity
with the requirements for qualification and taxation as a REIT for each
of the taxable years beginning with the year ended December 31, 1993,
and its current organization and method of operation should enable it
to continue to meet the requirements for qualification and taxation as
a REIT.
(29) The Operating Partnership and each of the Subsidiary
Partnerships are properly classified as partnerships, and not as
corporations or as associations taxable as corporations, for Federal
income tax purposes throughout the period from July 22, 1993 through
the date hereof, or, in the case of any Subsidiary Partnerships that
have terminated, through the date of termination of such Subsidiary
Partnerships.
(30) Each of the Company, the Operating Partnership and its
Subsidiaries has filed all federal, state, local and foreign income tax
returns which have been required to be filed (except in any case in
which the failure to file would not have a Material Adverse Effect) and
has paid all taxes required to be paid and any other assessment, fine
or penalty levied against it, to the extent that any of the foregoing
is due and payable, except, in all cases, for any such tax, assessment,
fine or penalty that is being contested in good faith.
(31) The Underwritten Securities, upon issuance, will be
excluded or exempted under, or beyond the purview of, the Commodity
Exchange Act, as amended, and the rules and regulations of the
Commodity Futures Trading Commission under such Act, as amended.
(b) Any certificate signed by any officer of the Operating Partnership
(or any officer of the Company, Post GP Holdings, Inc., a Georgia corporation
and sole general partner of the Operating Partnership ("Post GP")), or
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18
of any Subsidiary, and delivered to you or to counsel for the Underwriters in
connection with the offering of the Underwritten Securities shall be deemed a
representation and warranty by the Operating Partnership 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 set forth
herein or in the applicable Terms Agreement.
(b) In addition, on the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Operating Partnership may grant, if so provided in the applicable Terms
Agreement relating to the Initial Underwritten Securities, an option to the
Underwriters named in such Terms Agreement, severally and not jointly, to
purchase up to the aggregate principal amount, as the case may be, of the Option
Underwritten Securities set forth therein at a price per Option Underwritten
Security equal to the price per Initial Underwritten Security, less an amount
equal to any distributions declared by the Operating Partnership and paid or
payable on the Initial Underwritten Securities but not payable on the Option
Underwritten Securities. Such option, if granted, will expire 30 days or such
lesser number of days as may be specified in the applicable Terms Agreement
after the Representation Date relating to the Initial Underwritten Securities,
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 you to
the Operating Partnership, as the case may be, 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
you, but shall not be later than seven full business days and not be earlier
than two full business days after the exercise of said option, unless otherwise
agreed upon by you and the Operating Partnership. If the option is exercised as
to all or any portion of the Option Underwritten Securities, each of the
Underwriters, acting severally and not jointly, will purchase that proportion of
the total 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 total aggregate principal amount of Initial
Underwritten
- 18 -
19
Securities, subject to such adjustments as you in your discretion shall make to
eliminate any sales or purchases of fractional Option Underwritten Securities.
(c) Payment of the purchase price for, and delivery of, the Initial
Underwritten Securities to be purchased by the Underwriters shall be made at the
offices of Hogan & Hartson L.L.P., 555 Thirteenth Street, N.W., Washington, D.C.
20004, or at such other place as shall be agreed upon by you and the Operating
Partnership, 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 unless
postponed in accordance with the provisions of Section 10) following the date of
the applicable Terms Agreement, or such other time as shall be agreed upon by
you and the Operating Partnership (each such time and date of payment and
delivery being herein called a "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 Hogan & Hartson L.L.P., or at such other place as
shall be agreed upon by you and the Operating Partnership, on the relevant Date
of Delivery as specified in the notice from you to the Operating Partnership.
Payment shall be made to the Operating Partnership, by wire transfer or
by certified or official bank check or checks drawn in Federal or similar
same-day funds payable to the order of the Operating Partnership, as applicable,
against delivery to you for the respective accounts of the Underwriters of the
Underwritten Securities to be purchased by them. It is understood that each
Underwriter has authorized you, 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. You, individually and not as
representative of the Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Underwritten Securities to be purchased by
any Underwriter whose check has 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 authorized
denominations and registered in such names as you may request in writing at
least two full business days prior to the applicable Closing Time or the
relevant Date of Delivery, as the case may be. The Underwritten Securities will
be made available for examination and packaging by you on or before the first
business day prior to the Closing Time or the relevant Date of Delivery, as the
case may be.
SECTION 3. Covenants of the Operating Partnership. The Operating
Partnership covenants with you and with each Underwriter participating in the
offering of Underwritten Securities, as follows:
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20
(a) In respect of each offering of Underwritten Securities,
the Operating Partnership will prepare a Prospectus Supplement setting
forth the principal amount of Underwritten Securities covered thereby
and their terms not otherwise specified in the Prospectus or the
Indenture pursuant to which the Underwritten Securities are being
issued, the names of the Underwriters participating in the offering and
the principal amount of Underwritten Securities which each severally
has agreed to purchase, the names of the Underwriters acting as
co-managers in connection with the offering, the price at which the
Underwritten Securities are to be purchased by the Underwriters from
the Operating Partnership, the initial public offering price, if any,
the selling concession and reallowance, if any, and such other
information as you and the Operating Partnership deem appropriate in
connection with the offering of the Underwritten Securities; and the
Operating Partnership will promptly transmit copies of the Prospectus
Supplement to the Commission for filing pursuant to Rule 424(b) of the
1933 Act Regulations within the time period required by such Rule and
will furnish to the Underwriters named therein as many copies of the
Prospectus and such Prospectus Supplement as you shall reasonably
request. If, at the time that the Registration Statement becomes
effective, any information shall have been omitted therefrom in
reliance upon Rule 430A of the 1933 Act Regulations, then immediately
following execution of the applicable Terms Agreement, the Operating
Partnership will prepare, and file or transmit for filing with the
Commission in accordance with such Rule 430A and Rule 424(b) of the
1933 Act Regulations, copies of an amended Prospectus or, if required
by such Rule 430A, a post-effective amendment to the Registration
Statement (including an amended Prospectus), including all information
so omitted.
(b) The Operating Partnership will notify you immediately, and
confirm such notice in writing, of (i) the effectiveness of any
amendment to the Registration Statement, (ii) the transmittal to the
Commission for filing of any Prospectus Supplement or other supplement
or amendment to the Prospectus or any document to be filed pursuant to
the 1934 Act, (iii) the receipt of any comments from the Commission,
(iv) 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 (v) 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 or offering or sale in any jurisdiction, or
of any proceedings for any of such purposes; and the Operating
Partnership will make every
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21
reasonable effort to prevent the issuance of any such stop order and,
if any stop order is issued, to obtain the lifting thereof at the
earliest possible moment.
(c) At any time when the Prospectus is required to be
delivered under the 1933 Act or the 1934 Act in connection with sales
of the Underwritten Securities, the Operating Partnership will give you
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, and will furnish
you 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 you or counsel for the Underwriters
shall object.
(d) The Operating Partnership has furnished or will deliver to
you and counsel for the Underwriters, without charge, as many conformed
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 conformed copies of all consents
and certificates of experts as you may reasonably request. The copies
of the Registration Statement and each amendment thereto furnished to
the Underwriters will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to EDGAR, except to
the extent permitted by Regulation S-T.
(e) The Operating Partnership will deliver to each
Underwriter, without charge, as many copies of each preliminary
prospectus as such Underwriter may reasonably request, and the
Operating Partnership hereby consents to the use of such copies for
purposes permitted by the 1933 Act. The Operating Partnership 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. If applicable, the Prospectus and any amendments or
supplements thereto furnished to the Underwriters will be identical to
the electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.
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22
(f) The Operating Partnership will comply with 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 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 Underwritten
Securities, any event shall occur or condition shall exist as a result
of which it is necessary, in the reasonable opinion of counsel for the
Underwriters or for the Operating Partnership, 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 any material fact
necessary in order to make the statements therein, in light of the
circumstances existing at the time it is delivered to a purchaser not
misleading, or if it shall be necessary, in the reasonable opinion of
either of such counsel, at any such time to amend or supplement the
Registration Statement or the Prospectus in order to comply with the
requirements of the 1933 Act or the 1933 Act Regulations, then the
Operating Partnership will promptly prepare and file with the
Commission such amendment or supplement in form and substance
reasonably satisfactory to counsel for the Underwriters, whether by
filing documents pursuant to the 1933 Act, the 1934 Act or otherwise,
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 Operating Partnership will furnish to the
Underwriters, without charge, such number of copies of such amendment
or supplement as the Underwriters may reasonably request.
(g) The Operating Partnership will use its reasonable best
efforts, in cooperation with the Underwriters, to qualify the
Underwritten Securities for offering and sale under the applicable
securities laws and real estate syndication laws of such states and
other jurisdictions (domestic or foreign) as you may designate and to
maintain such qualifications in effect; provided, however, that the
Operating Partnership shall not be obligated to file any general
consent to service of process or to qualify as a foreign corporation in
any jurisdiction in which it is not so qualified or to subject itself
to taxation in respect to 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 Operating
Partnership will file such statements and reports as may be required by
the laws of such jurisdiction to continue such qualification in effect
for so long as may be required for the distribution of the Underwritten
Securities.
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23
(h) With respect to each sale of Underwritten Securities, the
Company and the Operating Partnership will make generally available to
its security holders as soon as practicable, but not later than 90 days
after the close of the period covered thereby, an earning statement (in
form complying with the provisions of Rule 158 of the 1933 Act
Regulations) covering a 12-month period beginning not later than the
first day of the Operating Partnership's fiscal quarter next following
the "effective date" (as defined in such Rule 158) of the Registration
Statement.
(i) The Operating Partnership 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."
(j) The Operating Partnership will not, between the date of
the applicable Terms Agreement and the termination of any trading
restrictions or the applicable Closing Time, whichever is later, with
respect to the Underwritten Securities covered thereby, without your
prior written consent, offer or sell, grant any option for the sale of,
or enter into any agreement to sell, any debt securities of the same
class or series or ranking on a parity with such Underwritten
Securities (other than the Underwritten Securities which are to be sold
pursuant to such Terms Agreement).
(k) The Operating Partnership, 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 Section 13, 14 or 15 of the 1934 Act within the time
periods required by the 1934 Act and the 1934 Act Regulations.
(l) In respect to each offering of Debt Securities, the
Company will qualify an Indenture under the 1939 Act.
(m) The Operating Partnership will take all reasonable action
necessary to enable Standard & Poor's Corporation ("S&P"), Moody's
Investors Service, Inc. ("Moody's") or any other nationally recognized
statistical rating organization to provide their respective credit
ratings of any Underwritten Securities, if applicable.
SECTION 4. Payment of Expenses. The Operating Partnership will pay all
expenses incident to the performance of its obligations under this Agreement or
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 and delivery to
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24
the Underwriters of this Agreement, any Terms Agreement, any Agreement among
Underwriters, the Indentures, and such other documents as may be required in
connection with the offering, purchase, sale and delivery of the Underwritten
Securities to the Underwriters, (iii) the preparation, issuance and delivery of
the Underwritten Securities, (iv) the reasonable fees and disbursements of the
Operating Partnership's counsel, accountants and other advisors or agents
(including transfer agents and registrars), as well as the reasonable fees and
disbursements of the Trustees, and their respective counsel, (v) the
qualification of the Underwritten Securities under state securities laws and
real estate syndication laws in accordance with the provisions of Section 3(g)
hereof, including filing fees and the reasonable fees and disbursements of
counsel for the Underwriters in connection therewith and in connection with the
preparation, and delivery of the Blue Sky Memorandum 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) any fees charged by nationally recognized statistical rating
organizations for the rating of the Underwritten Securities, (viii) the fees and
expenses incurred with respect to the listing of the Underwritten Securities on
any national exchange, (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 and any related Underlying
Securities, (x) the fees and expenses of any Underwriter acting in the capacity
of a "qualified independent underwriter" (as defined in Section 2710(c)(8) of
the Conduct Rules of the NASD), if applicable, (xi) the fees and expenses of the
Trustee, including the reasonable fees and disbursements of counsel for the
Trustee, in connection with the Indenture and the Underwritten Securities, and
(xii) the preparation, issuance and delivery to the Depository Trust Company for
credit to the accounts of the respective Underwriters of any global note
registered in the name of Cede & Co., as nominee for the Depository Trust
Company.
If the applicable Terms Agreement is terminated by you in accordance
with the provisions of Section 5 or Section 9(b)(i) hereof, the Operating
Partnership 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 several
obligations of the Underwriters to purchase and pay for the Underwritten
Securities pursuant to the applicable Terms Agreement are subject to the
accuracy as of the date hereof and of Closing Time of the representations and
warranties of the Operating Partnership contained herein, to the accuracy of the
statements of officers of the Company, Post GP, the Operating Partnership or any
Subsidiary made in any certificate delivered pursuant to the provisions hereof,
to the performance by the Operating Partnership of all of its covenants and
other obligations hereunder, and to the following further conditions:
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25
(a) (i) The Registration Statement, including any Rule 462(b)
Registration Statement, shall have 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 or proceedings
therefor initiated 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; (ii) a prospectus containing information relating to the
description of the Underwritten Securities, the specific method of
distribution and similar matters shall have been filed within the
prescribed time period, and prior to the applicable Closing Time with
the Commission in accordance with Rule 424(b) (or any required
post-effective amendment providing such information shall have been
filed and declared effective in accordance with the requirements of
Rule 430A), or, if the Operating Partnership 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); (iii) the rating assigned by any nationally
recognized statistical rating organization to Debt Securities of the
Operating Partnership as of the date of the applicable Terms Agreement
shall not have been lowered since such date nor shall any such rating
organization have publicly announced that it has placed any Debt
Securities of the Operating Partnership on what is commonly termed a
"watch list" for possible downgrading; and (iv) there shall not have
come to your attention any facts that would cause you to believe that
the Prospectus, together with the applicable Prospectus Supplement, at
the time it was required to be delivered to purchasers of the
Underwritten Securities, included an untrue statement of a material
fact or omitted to state a material fact necessary in order to make the
statements therein, in light of the circumstances existing at such
time, not misleading.
(b) At Closing Time, the Representatives shall have received
the opinion, dated as of the applicable Closing Time, of King &
Spalding, counsel for the Company, Post GP, the Operating Partnership
and the Subsidiaries, in form and substance satisfactory to counsel for
the Underwriters, together with signed or reproduced copies of such
letter for each of the other Underwriters, to the effect that:
(i) The Operating Partnership has been duly formed
and is validly existing as a limited partnership under the
Georgia Act. The Operating Partnership has partnership power
and authority to own, lease and operate its properties and to
conduct the business in which it is engaged, and, to counsel's
knowledge, is duly qualified as a foreign partnership in the
jurisdictions set forth in an exhibit to the opinion. All of
the issued and outstanding interests in the Operating
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26
Partnership have been duly authorized and validly issued and
fully paid.
(ii) Each of Post Services, Inc., Post Asset
Management, Inc., Post Landscape Services, Inc., RAM Partners,
Inc., any Significant Subsidiary within the meaning of Rule
1-02 of Regulation S-X (collectively, the "Significant
Subsidiaries"), the Company and Post GP has been duly formed
and is validly existing and in good standing under the laws of
the jurisdiction of its formation. Each of the Significant
Subsidiaries has the power and authority to own, lease and
operate its properties and to conduct the business in which it
is engaged, and, to counsel's knowledge, is duly qualified as
a foreign corporation or partnership and is in good standing
in the jurisdictions set forth in an exhibit to the opinion.
All of the issued and outstanding shares of capital stock, LLC
interests and partnership interests of each Significant
Subsidiary have been duly authorized and validly issued, are
fully paid and are owned, to such counsel's knowledge, free
and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity, other than as set forth in the
Registration Statement or Prospectus and the transfer
restrictions set forth in the Option and Transfer Agreement by
and among the Operating Partnership, Post Services, Inc., John
A. Williams and John T. Glover. The ownership of the shares of
capital stock of each Significant Subsidiary is as described
in the Registration Statement or Prospectus.
(iii) The Indenture has been duly qualified under the
1939 Act and has been duly authorized, executed and delivered
by the Operating Partnership and (assuming due authorization,
execution and delivery by the Trustee) constitutes the valid
and binding obligation of the Operating Partnership
enforceable against the Operating Partnership in accordance
with its terms, subject to (1) applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer,
or similar laws affecting creditors' rights generally from
time to time in effect and (2) general principles of equity
(regardless of whether such enforceability is considered in a
proceeding at law or in equity). However, we express no
opinion as to the effect on enforceability of (A) requirements
that a claim with respect to any Underwritten Securities
payable 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) federal or state
law limiting, delaying or prohibiting the making of payments
outside the United States.
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(iv) The Underwritten Securities have been duly and
validly authorized by all necessary action and, when executed,
authenticated and delivered in accordance with the Indenture
and against payment therefor as specified in the applicable
Terms Agreement, will be entitled to the benefits of the
Indenture and will be valid and legally binding obligations of
the Operating Partnership enforceable against the Operating
Partnership in accordance with their terms, subject to (1)
applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer, or similar laws affecting creditors'
rights generally from time to time in effect and (2) general
principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in
equity). However, we express no opinion as to the effect on
enforceability of (A) requirements that a claim with respect
to any Underwritten Securities payable 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) federal or state law limiting, delaying
or prohibiting the making of payments outside the United
States.
(v) Each of this Agreement and the applicable Terms
Agreement has been duly and validly authorized, executed and
delivered by the Operating Partnership, and the Operating
Partnership has the power and authority to perform its
obligations hereunder and thereunder.
(vi) The execution and delivery of this Agreement and
the applicable Terms Agreement by the Operating Partnership,
and the performance by the Operating Partnership of its
obligations hereunder and thereunder and the consummation of
the transactions contemplated hereunder and thereunder, did
not, do not and will not conflict with or constitute a breach
or violation of, or default under: (A) to the knowledge of
counsel, any instrument or agreement filed or incorporated by
reference as an exhibit to the Registration Statement to which
the Operating Partnership is a party or by which it or any of
its respective properties or other assets or any Property may
be bound or subject; (B) the certificate of limited
partnership or partnership agreement of the Operating
Partnership; or (C) to the knowledge of counsel, any
applicable law, rule, order, administrative regulation or
administrative or court decree, except that no opinion is
expressed under this clause (C) as to this Agreement or the
Terms Agreement with respect to federal, state or foreign
securities laws.
(vii) The Registration Statement is effective under
the 1933 Act and, to counsel's knowledge based solely upon
telephonic
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28
confirmation from the staff of the Commission, no stop order
suspending the effectiveness of the Registration Statement has
been issued under the 1933 Act and no proceedings for that
purpose have been initiated or threatened by the Commission.
(viii) The Underwritten Securities and the Indenture
conform in all material respects to the descriptions thereof
contained in the Prospectus.
(ix) No consent, approval, authorization or order of,
or qualification with, any governmental body or agency and no
consent, approval, or authorization of any person other than
the Operating Partnership is required for the performance by
the Operating Partnership of its obligations under this
Agreement, the applicable Terms Agreement, the Indenture or
the Underwritten Securities, except such as may be required
under the 1933 Act, the 1939 Act, and the securities, Blue Sky
or real estate syndication laws of various states or the rules
of the NASD in connection with the offer and sale of the
Underwritten Securities.
(x) To the knowledge of counsel, there is no action,
suit or proceeding before or by any court or governmental
agency or body, domestic or foreign, now pending or threatened
against or affecting the Company, the Operating Partnership,
any Significant Subsidiary or any material property of the
Company that is required to be disclosed in the Registration
Statement (other than as disclosed therein) or that, if
determined adversely to the Company, the Operating
Partnership, any Significant Subsidiary or any such property,
could reasonably be expected to materially and adversely
affect the consummation of the transactions contemplated by
this Agreement. To the knowledge of counsel, there are no
contracts or documents of the Operating Partnership or any
Significant Subsidiary which are required by the 1933 Act, or
by the 1933 Act Regulations, the 1934 Act, or the 1934 Act
Regulations to be filed as exhibits to the Registration
Statement, the Prospectus or the documents incorporated by
reference which have not been so filed as exhibits as
required.
(xi) None of the Company, the Operating Partnership
or any Subsidiary is required to be registered as an
investment company under the 1940 Act.
(xii) The information in the Prospectus and the
applicable Prospectus Supplement under the headings
"Description of Debt Securities," "Description of Notes" and
"Federal Income Tax Considerations" to the extent that it
constitutes matters of law or legal
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29
conclusions has been reviewed by such counsel, is correct and
presents fairly the information required to be disclosed
therein.
(xiii) At the time the Registration Statement became
effective and at the Representation Date, the Registration
Statement and Prospectus (except for financial statements and
supporting schedules and other financial information and data
included or incorporated by reference therein or the Statement
of Eligibility, as to which such counsel need not express any
opinion), excluding the documents incorporated by reference
therein, complied as to form in all material respects with the
requirements of the 1933 Act, the 1939 Act and the 1933 Act
Regulations.
(xiv) Each document heretofore filed pursuant to the
1934 Act and incorporated or deemed to be incorporated by
reference in the Prospectus (except for financial statements
and supporting schedules and other financial information and
data included or incorporated by reference therein, as to
which such counsel need not express any opinion) complied as
to form in all material respects with the requirements of the
1934 Act and the applicable 1934 Act Regulations in effect at
the date of their respective filings.
(xv) The Company was organized and has operated in
conformity with the requirements for qualification and
taxation as a REIT each of its taxable years beginning with
the year ended December 31, 1993, and its current organization
and method of operation should enable it to continue to meet
the requirements for qualification and taxation as a REIT.
(xvi) The Operating Partnership and each Significant
Subsidiary that is a partnership ("Subsidiary Partnership")
are properly classified as partnerships, and not as
corporations or as associations taxable as corporations, for
Federal income tax purposes throughout the period from July
22, 1993 through the date hereof, or, in the case of any
Subsidiary Partnerships that have terminated, through the date
of termination of such Subsidiary Partnerships.
(c) At Closing Time, you shall have received the favorable
opinion, dated as of the applicable Closing Time, of Hogan & Hartson
L.L.P., counsel for the Underwriters, with respect to the matters set
forth in (i) (first sentence only), (iii), (iv), (v), (vii), (viii),
(xii) (solely with respect to information set forth in "Description of
Debt Securities" and "Description of Notes"), and (xiii) of Section
5(b) above.
(d) In rendering their opinions required by Sections 5(b) and
(c), respectively, King & Spalding and Hogan & Hartson L.L.P. shall
each additionally state (which shall not constitute an opinion) that no
facts have
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30
come to the attention of such counsel which cause them to believe that
the Registration Statement or any amendment thereto (except for
financial statements and supporting schedules and other financial
information and data included therein or omitted therefrom, or the
Statement of Eligibility, as to which such counsel need not express any
view), as of the time it became effective under the 1933 Act (and as of
the time of filing of the Operating Partnership's Annual Report on Form
10-K, if filed subsequent to the time of effectiveness) or at the date
of the applicable Terms Agreement, 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 or any amendment or supplement thereto (except as
aforesaid) as of the date of the applicable Terms Agreement or at the
applicable Closing Time, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
In giving their opinions required by Section 5(b) and 5(c),
such counsel (A) may rely as to all matters of fact, upon certificates
and written statements of officers and employees of and accountants for
the Operating Partnership, Post GP and the Company and (B) may rely as
to the qualification and good standing of each of the Operating
Partnership or any of the Subsidiaries to do business in any state or
jurisdiction, upon certificates of appropriate government officials or
opinions of counsel in such jurisdictions, which opinions shall be in
form and substance satisfactory to counsel for the Underwriters. In
giving their belief required in this Section 5(d), such counsel may
state that their belief is based upon their participation in the
preparation of the Registration Statement and Prospectus and any
amendments and supplements thereto and review and discussion of the
contents thereof.
(e) 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
Effect, whether or not arising in the ordinary course of business, and
you shall have received a certificate of the President or a Vice
President of Post GP and the Operating Partnership, and the chief
financial officer or chief accounting officer of Post GP and the
Operating Partnership, dated as of the Closing Time, to the effect that
(i) there has been no such Material Adverse Effect, (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 Operating Partnership 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
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31
have been instituted or are pending or, to the best of such officer's
knowledge, are threatened by the Commission.
(f) At the time of the execution of the applicable Terms
Agreement, you shall have received from PricewaterhouseCoopers LLP a
letter dated such date, in form and substance satisfactory to you
together with signed or reproduced copies of such letter for each of
the other Underwriters, to the effect that: (i) they are independent
accountants with respect to the Company, the Operating Partnership and
their Subsidiaries within the meaning of the 1933 Act and the 1933 Act
Regulations; (ii) it is their opinion that the consolidated financial
statements and supporting schedules included or incorporated by
reference in the Registration Statement and the Prospectus and covered
by their opinions therein comply in form in all material respects with
the applicable accounting requirements of the 1933 Act and the 1933 Act
Regulations; (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 financial
statements of the Company and the Operating Partnership included or
incorporated by reference in the Registration Statement), nothing has
come to their attention which causes them to believe that, (A) any
material modifications should be made to the unaudited condensed
financial statements included or incorporated by reference in the
Registration Statement for them to be in conformity with GAAP or (B)
the unaudited condensed 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 1934 Act as it applies to Form 10-Q and the related published rules
and regulations or (C) at a specified date not more than five days
prior to the date of the applicable Terms Agreement, there has been any
change in the Common Stock of the Company or partnership interests in
the Operating Partnership or in the consolidated long term debt of the
Company and the Operating Partnership or any decrease in the net assets
of the Company, as compared with the amounts shown in the most recent
consolidated balance sheet included or incorporated by reference in the
Registration Statement and the Prospectus or, during the period from
the date of the most recent consolidated statement of operations
included or incorporated by reference in the Registration Statement and
the Prospectus to a specified date not more than five days prior to the
date of the applicable Terms Agreement, there were any decreases, as
compared with the corresponding period in the preceding year, in
consolidated revenues, or decrease in net income or net income per
share of common stock of the Company and the Operating Partnership, as
applicable, except in all instances for changes, increases or decreases
which the Registration Statement and the Prospectus disclose have
occurred or may
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32
occur; and (iv) in addition to the audit referred to in their opinions
and the limited procedures referred to in clause (iii) above, they have
carried out certain specified procedures with respect to certain
amounts, percentages and financial and statistical information which
are included in the Registration Statement and the Prospectus and which
are specified by you, and have found such amounts, percentages and
financial and statistical information to be in agreement with relevant
accounting, financial and other records of the Company and the
Operating Partnership and their Subsidiaries identified in such letter.
(g) At Closing Time, you shall have received from
PricewaterhouseCoopers LLP a letter, dated as of the applicable Closing
Time, to the effect that they reaffirm the statements made in the
letter furnished pursuant to subsection (f) of this Section 5, except
that the specified date referred to shall be a date not more than three
business days prior to the applicable Closing Time and if the Operating
Partnership has elected to rely on Rule 430A of the 1933 Act
Regulations, to the further effect that they have carried out the
procedures specified in clause (iv) of subsection (f) of this section
with respect to certain amounts, percentages and financial and
statistical information specified by you and deemed to be part of the
Registration Statement pursuant to Rule 430A(b) and have found such
amounts, percentages and financial and statistical information to be in
agreement with the records specified in such clause (iv).
(h) At Closing Time and at any relevant Date of Delivery, the
Underwritten Securities shall be rated by any "nationally recognized
statistical rating organization," as defined by the Commission for
purposes of Rule 436(g)(2) of the 1933 Act Regulations, with the rating
or ratings specified in the applicable Terms Agreement, and the
Operating Partnership shall have delivered to you a letter, dated as of
such date, from each such rating organization, or other evidence
satisfactory to you, 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 or the Operating
Partnership's other securities by any such rating organization, and no
such rating organization shall have publicly announced that it has
under surveillance or review, with possible negative implications, its
rating of the Underwritten Securities or any of the Company's or the
Operating Partnership's other securities.
(i) 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.
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33
(j) In the event that the Underwriters are granted an over-
allotment option by the Operating Partnership 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 Operating Partnership contained herein and the
statements in any certificates furnished by the Company or the
Operating Partnership hereunder shall be true and correct as of each
Date of Delivery, and, at the relevant Date of Delivery, you shall have
received:
(1) A certificate, dated such Date of Delivery, of
the President or a Vice President of Post GP and the Operating
Partnership and the chief financial officer or chief
accounting officer of Post GP and the Operating Partnership,
confirming that the certificate delivered at the Closing Time
pursuant to Section 5(d) hereof remains true and correct as of
such Date of Delivery,
(2) The favorable opinion of King & Spalding, counsel
for the Company, 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 opinion required by Section 5(b) hereof
(including the statement of belief required by Section 5(d)
hereof).
(3) The favorable opinion of Hogan & Hartson LLP,
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(c)
hereof (including the statement of belief required by Section
5(d) hereof).
(4) A letter from PricewaterhouseCoopers LLP, in form
and substance satisfactory to you and dated such Date of
Delivery, substantially in the same form and substance as the
letter furnished to you pursuant to Section 5(f) here of,
except that the "specified date" on the letter furnished
pursuant to this 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
Operating Partnership in connection with the issuance and sale of the
Underwritten Securities as herein contemplated
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34
shall be satisfactory in form and substance to you 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
you by notice to the Operating Partnership 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 4, 6 and 7 shall survive any such termination
and remain in full force and effect.
SECTION 6. Indemnification.
(a) The Operating Partnership 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, and any
director, officer, employee or affiliate thereof, 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 investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
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35
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 Operating Partnership; and
(3) against any and all expense whatsoever, as incurred
(including, without limitation, the fees and other charges of counsel
chosen by the Underwriters), 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 (1) or (2) 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 Operating
Partnership by any Underwriter through you 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 Operating Partnership, its directors, officers, employees and affiliates and
each person, if any, who controls the Operating Partnership 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 Operating Partnership by such Underwriter through you 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
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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 Operating
Partnership. An indemnifying party may participate at its own expense in 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 part 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
Operating Partnership 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 Operating Partnership, on the one hand, and of the
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37
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 Operating Partnership, 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 Operating Partnership, and the total underwriting discount
received by the Underwriters, in 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 Operating Partnership, on the one hand, and
the Underwriters, on the other hand, shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Operating Partnership or by the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Operating Partnership 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 such untrue or
alleged untrue statement or omission or alleged omission.
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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 person, if any, who controls the Operating Partnership 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 Operating Partnership. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the aggregate principal amount of Initial Underwritten Securities
set forth opposite their respective names in applicable Terms Agreement, and not
joint.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or the applicable Terms Agreement or in certificates of officers of
Post GP or the Operating Partnership submitted pursuant hereto or thereto shall
remain operative and in full force and effect, regardless of any termination of
this Agreement or the applicable Terms Agreement or investigation made by or on
behalf of any Underwriter or controlling person, or by or on behalf of Post GP
and the Operating Partnership, and shall survive delivery of and payment for the
Underwritten Securities.
SECTION 9. Termination of Agreement
(a) This Agreement (excluding the applicable Terms Agreement) may be
terminated for any reason at any time by the Operating Partnership or by you
upon the giving of 30 days' prior written notice of such termination to the
other party hereto.
(b) You may terminate the applicable Terms Agreement, by notice to the
Operating Partnership, at any time at or prior to the applicable 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, assets
or business prospects of the Company, the Operating Partnership and their
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
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which is such as to make it, in your judgment, 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 New York Stock Exchange, Inc. or if trading
generally on the New York Stock Exchange, Inc. or the American Stock Exchange,
Inc. 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 order of the Commission, or any other governmental
authority, (iv) a banking moratorium has been declared by either Federal or New
York authorities or, if the Underwritten Securities are 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 or (v) if the rating
assigned by any nationally recognized statistical rating organization to any
Debt Securities of the Operating Partnership as of the date of the applicable
Terms Agreement shall have been lowered since such date or if any such rating
organization shall have publicly announced that it has placed any Preferred
Stock of the Company or Debt Securities of the Operating Partnership on what is
commonly termed a "watch list" for possible downgrading. As used in this
Section 9(b), the term "Prospectus" means the Prospectus in the form first used
to confirm sales of the Underwritten Securities.
(c) If this 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 4, 6 and 7 shall survive such termination and remain in
full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more
of the Underwriters shall fail at the applicable 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 you 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, you 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
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obligations under such Terms bear to the underwriting obligations of
all non-defaulting Underwriters, or
(b) if the aggregate principal amount of Defaulted Securities
exceeds 10% of the number or aggregate principal amount, as the case
may be, 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 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 you or the Operating Partnership shall
have the right to postpone the applicable 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 Merrill Lynch World
Headquarters, World Financial Center, North Tower - 10th Floor, New York, New
York 10281-1310, attention: Tjarta van S. Clagett, notices to the Company and
the Operating Partnership shall be directed to them at 4401 Northside Parkway,
Suite 800, Atlanta, Georgia 30327, attention: Jeffrey A. Harris, President.
SECTION 12. Parties. This Agreement and the applicable Terms Agreement
shall each inure to the benefit of and be binding upon the Operating
Partnership, you and, upon execution of such Terms Agreement, any other
Underwriters and their respective successors. Nothing expressed or mentioned in
this Agreement or such Terms Agreement is intended or shall be construed to give
any person, firm or corporation, other than the Underwriters and the Operating
Partnership and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their heirs and legal
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41
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or such Terms Agreement or any provision herein or
therein contained. This 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 PURCHASE AGREEMENT AND ANY
APPLICABLE TERMS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
ANY SUIT, ACTION OR PROCEEDING BROUGHT BY THE OPERATING PARTNERSHIP AGAINST ANY
AGENT IN CONNECTION WITH OR ARISING UNDER THIS AGREEMENT SHALL BE BROUGHT SOLELY
IN THE STATE OR FEDERAL COURT OF APPROPRIATE JURISDICTION LOCATED IN THE BOROUGH
OF MANHATTAN, THE CITY OF NEW YORK. SPECIFIED TIMES OF DAY REFER TO NEW YORK
CITY TIME.
SECTION 14. Counterparts.
This Agreement and the applicable Terms Agreement may be executed in
one or more counterparts, and if executed in more than one counterpart the
executed counterparts shall contribute a single instrument.
SECTION 15. Effect of Headings. The Article and Section headings herein
are for convenience only and shall not affect the construction hereof.
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42
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Operating Partnership a counterpart
hereof, whereupon this Agreement, along with all counterparts, will become a
binding agreement between you and the Operating Partnership in accordance with
its terms.
Very truly yours,
POST APARTMENT HOMES, L.P.
By: POST GP HOLDINGS, INC., its
general partner
By: /s/ R. Gregory Fox
----------------------------------
Name: R. Gregory Fox
Title: Executive Vice President
and Chief Financial Officer
CONFIRMED AND ACCEPTED,
AS OF THE DATE FIRST ABOVE WRITTEN:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ Tjarda Clagget
------------------------------------
Authorized Signatory
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43
EXHIBIT A
POST APARTMENT HOMES, L.P.
a Georgia limited partnership
Debt Securities
TERMS AGREEMENT
To: Post Apartment Homes, L.P.
4401 Northside Parkway,
Suite 800,
Atlanta, Georgia 30327
Ladies and Gentlemen:
We understand that Post Apartment Homes, L.P., a Georgia limited
partnership (the "Operating Partnership"), proposes to issue and sell [$________
aggregate principal amount of its [senior] [subordinated] 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].
Principal Amount
Underwriter of Initial Underwritten Securities
Total [$]
A-1
44
[Debt Securities]
Title:
Rank:
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:
Conversion provisions:
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 __________ (payable
in next day funds).
Form:
Other terms and conditions:
Closing date and location:
All of the provisions contained in the document attached as Annex I
entitled "POST APARTMENT HOMES, L.P.--Debt Securities--Purchase 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.
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45
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:
POST APARTMENT HOMES, L.P.
By: POST GP HOLDINGS, INC., its
general partner
By:
----------------------------
Name:
Title:
A-3