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EXHIBIT 1(a)
POST APARTMENT HOMES, L.P.
MEDIUM-TERM NOTES
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
January 29, 1997
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
J.P. Morgan Securities Inc.
60 Wall Street
New York, New York 10260
Dear Sirs:
Post Apartment Homes, L.P., a Georgia limited partnership (the "Operating
Partnership"), confirms its agreement with Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated and J.P. Morgan Securities Inc. (each, an
"Agent," and collectively, the "Agents") with respect to the issue and sale by
the Operating Partnership of its Medium-Term Notes Due Nine Months or More From
Date of Issue (the "Notes"). The Notes are to be issued pursuant to an
Indenture, dated as of September 25, 1996, as amended or modified from time to
time (the "Indenture"), between the Operating Partnership and SunTrust Bank,
Atlanta, as trustee (the "Trustee"). As of the date hereof, the Operating
Partnership has authorized the issuance and sale of up to U.S. $175,000,000
aggregate initial offering price of Notes (or its equivalent, based upon the
exchange rate on the applicable trade date in such foreign or composite
currencies as the Operating Partnership shall designate at the time of
issuance) to or through the Agents pursuant to the terms of this Agreement. It
is understood, however, that the Operating Partnership may from time to time
authorize the issuance of additional Notes and that such additional Notes may
be sold to or through the Agents pursuant to the terms of this Agreement, all
as though the issuance of such Notes were authorized as of the date hereof.
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This Agreement provides both for the sale of Notes by the Operating
Partnership to one or more Agents as principal for resale to investors and other
purchasers and for the sale of Notes by the Operating Partnership directly to
investors (as may from time to time be agreed to by the Operating Partnership
and the applicable Agent), in which case such Agent will act as an agent of the
Operating Partnership in soliciting offers for the purchase of Notes.
Post Properties, Inc., a Georgia corporation (the "Company"), and the
Operating Partnership have filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (No. 333-3555) for the
registration of, among other securities, debt securities of the Operating
Partnership (the "Debt Securities"), including the Notes, 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"). Such
registration statement (as amended, if applicable) has been declared effective
by the Commission and the Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended (the "1939 Act"). Such registration
statement 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 Notes 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
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 the applicable Agent(s) by the Operating
Partnership for use in connection with the offering of Notes (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 such applicable Agent(s) for such use; provided,
further, that a Prospectus Supplement shall be deemed to have supplemented the
Prospectus only with respect to the offering of Notes 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 shall be deemed to be part of
the Prospectus. A "preliminary prospectus" shall be deemed to refer to any
prospectus used before the registration statement became effective and any
prospectus furnished by the Operating Partnership after the registration
statement became effective and before any acceptance by the Operating
Partnership of an offer for the purchase of Notes which omitted information to
be
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included upon pricing in a form of prospectus filed with the Commission pursuant
to Rule 424(b) of the 1933 Act Regulations. 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 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.
SECTION 1. Appointment as Agent.
(a) Appointment. Subject to (i) the terms and conditions stated
herein and (ii) the reservation by the Operating Partnership of the right to
sell Notes directly on its own behalf and to appoint, upon at least 10 days'
prior written notice to the Agents, additional persons to serve as Agents
hereunder (provided that such persons are engaged on the same terms and
conditions as those contained in this Agreement), the Operating Partnership
hereby agrees that Notes will be sold to or through the Agents and that it will
not appoint any other agents to act on its behalf, or to assist it, in the
placement of the Notes; provided, however, that notwithstanding anything to the
contrary included in this Agreement, the Operating Partnership may accept any
offer to purchase Notes from or through any broker or dealer (other than an
Agent) if (i) the Operating Partnership shall not have solicited such offer,
(ii) such broker or dealer is engaged on substantially the same terms and
conditions as those contained in this Agreement, except for the obligations
described in Sections 8(a), 8(b) and 8(c) hereof, and (iii) the Operating
Partnership notifies the Agents promptly following acceptance of such an offer.
(b) Sale of Notes. The Operating Partnership shall not sell or approve
the solicitation of offers for the purchase of Notes in excess of the amount
which shall be authorized by the Operating Partnership from time to time or in
excess of the
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aggregate initial offering price of Notes registered pursuant to the
Registration Statement. The Agents shall have no responsibility for maintaining
records with respect to the aggregate initial offering price of Notes sold, or
of otherwise monitoring the availability of Notes for sale, under the
Registration Statement.
(c) Purchases as Principal. The Agents shall not have any obligation to
purchase Notes from the Operating Partnership as principal. However, absent an
agreement between an Agent and the Operating Partnership that such Agent shall
be acting solely as an agent for the Operating Partnership, such Agent shall be
deemed to be acting as principal in connection with any offering of Notes by
the Operating Partnership through such Agent. Accordingly, the Agents,
individually or in a syndicate, may agree from time to time to purchase Notes
from the Operating Partnership as principal for resale to investors and other
purchasers determined by such Agents. Any purchase of Notes from the Operating
Partnership by an Agent as principal shall be made in accordance with Section
3(a) hereof.
(d) Solicitations as Agent. If agreed upon between an Agent and the
Operating Partnership, such Agent, acting solely as an agent for the Operating
Partnership and not as principal, will solicit offers for the purchase of
Notes. Such Agent will communicate to the Operating Partnership, orally, each
offer for the purchase of Notes solicited by it on an agency basis other than
those offers rejected by such Agent. Such Agent shall have the right, in its
discretion reasonably exercised, to reject any offer for the purchase of Notes,
in whole or in part, and any such rejection shall not be deemed a breach of its
agreement contained herein. The Operating Partnership may accept or reject any
offer for the purchase of Notes, in whole or in part. Such Agent shall make
reasonable efforts to assist the Operating Partnership in obtaining performance
by each purchaser whose offer for the purchase of Notes has been solicited by
it on an agency basis and accepted by the Operating Partnership. Such Agent
shall not have any liability to the Operating Partnership in the event that any
such purchase is not consummated for any reason. If the Operating Partnership
shall default on its obligation to deliver Notes to a purchaser whose offer has
been solicited by such Agent on an agency basis and accepted by the Operating
Partnership, the Operating Partnership shall (i) hold such Agent harmless
against any loss, claim or damage arising from or as a result of such default
by the Operating Partnership and (ii) pay to such Agent any commission to which
it would otherwise be entitled absent such default.
(e) Reliance. The Operating Partnership and the Agents agree that any
Notes purchased from the Operating Partnership by one or more Agents as
principal shall be purchased, and any Notes the placement of which an Agent
arranges as an agent of the Operating Partnership shall be placed by such
Agent, in reliance on the representations, warranties, covenants and agreements
of the Operating Partnership contained herein and on the terms and conditions
and in the manner provided herein.
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SECTION 2. Representations and Warranties.
(a) The Operating Partnership represents and warrants to each Agent as of
the date hereof, as of the date of each acceptance by the Operating Partnership
of an offer for the purchase of Notes (whether to such Agent as principal or
through such Agent as agent), as of the date of each delivery of Notes (whether
to such Agent as principal or through such Agent as agent) (the date of each
such delivery to such Agent as principal is referred to herein as a "Settlement
Date"), and as of any time that the Registration Statement or the Prospectus
shall be amended or supplemented, other than an amendment or supplement
relating solely to the offering of securities other than the Notes (each of the
times referenced above is referred to herein as a "Representation Date"), as
follows:
(1) The Operating Partnership meets the requirements for use
of Form S-3 under the 1933 Act. The Registration Statement
(including any Rule 462(b) Registration Statement) has become
effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement 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. 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 the Registration Statement
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. As of the date hereof,
at the date of the Prospectus 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
an Agent by the Operating Partnership for use in connection with an
offering of
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Notes 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 an Agent for such use) did
not and will not 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 the Agents 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 Notes, 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
therefore.
(3) Each preliminary prospectus, preliminary prospectus
supplement and Prospectus Supplement filed as part of the
Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied, when so filed, in all material respects with the 1933 Act
Regulations and, if applicable, each preliminary prospectus and the
Prospectus delivered to the Agents for use in connection with the
offering of Notes 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, at the date hereof, at the date of the Prospectus and as
of each Representation Date, 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
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necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(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
(actual and, if any, pro forma) included in the Prospectus under
the captions "Ratios of Earnings to Fixed Charges" and in Exhibit
12.1 to the Registration Statement have been calculated in
compliance with Item 503(d) of Regulation S-K of the Commission. 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 Company, 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
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statements. Other than the historical financial statements (and
schedules) included therein, no other historical or pro forma
financial statements (or 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 2(a)(6)
above; (D) neither the Operating Partnership nor any Subsidiary has
incurred any material obligation or liability, direct, contingent
or otherwise; 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 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.
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(9) Each of the 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, 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 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 Subsidiary
have been validly issued and fully paid and are owned by the
Operating Partnership, the Company, another 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. Except as otherwise
disclosed in the Registration Statement or Prospectus, the Operating
Partnership owns no direct or indirect equity interest in any
entity other than its Subsidiaries.
(11) The Operating Partnership has full power and authority to
enter into and perform its obligations under this Agreement and
this Agreement has been duly authorized, executed and delivered by
the Operating Partnership and, assuming due authorization,
execution and delivery by the other parties thereto, 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 authorized, executed and
delivered and, assuming due authorization, execution and delivery
by the Trustee, constitutes a valid and binding obligation of the
Operating
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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 from time to
time in effect 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 Notes 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 Notes have been duly authorized by the Operating
Partnership for offer, sale, issuance and delivery pursuant to
this Agreement and when issued and authenticated in the manner
provided for in the Indenture and delivered against payment of the
consideration therefor, 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
other similar laws relating to or affecting creditors' rights
generally from time to time in effect 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 Notes 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 Notes will be in the form contemplated by,
and each registered holder thereof is entitled to the benefits of,
the applicable Indenture. The terms of such Notes conform in all
material respects to all statements and descriptions related
thereto contained in the Prospectus. Such Notes 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
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that may be incurred thereafter, except that such Notes will be
effectively 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 and the
Indenture and the execution and delivery of the Notes and the
transactions contemplated herein or therein, including the issuance,
sale and delivery of the Notes and the use of the proceeds from the
sale of the Notes 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 Indenture or the transactions
contemplated herein or therein or the performance by the Operating
Partnership of its obligations under this Agreement, the Indenture
or the Notes. 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 could reasonably be expected to 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 Indenture and the Notes or in connection with
the transactions contemplated under this Agreement, the Indenture,
or the Notes, 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 otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any
Intellectual Property or of any facts or
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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 likely 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 likely to result
in a Material Adverse Effect.
(21) (A) Except as otherwise set forth in the Registration
Statement or Prospectus, the Operating Partnership has good and
marketable fee simple title to the land underlying the Properties
and good and marketable title to the improvements thereon and 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 utility
easements serving such Properties, to liens of ad valorem
taxes not due and payable, 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, 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 business operations
being conducted or proposed to be conducted thereon, ownership of
cable television lines and facilities serving one or more of such
Properties by the cable television providers or their affiliates,
service marks and trade names used in connection with such
Properties, and ownership by others of certain
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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 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 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," the Operating Partnership is the beneficiary 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.
(22) The Operating Partnership is not, and upon the issuance
and sale of the Notes 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
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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 could 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 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 be reasonably 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
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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. Section
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. Section
9601, et seq.) ("CERCLA"), the Resource Conservation Recovery Act,
as amended (42 U.S.C. Section 6901, et seq.), the Clean Air Act,
as amended (42 U.S.C. Section 7401, et seq.), the Clean Water Act,
as amended (33 U.S.C. Section 1251, et seq.), the Toxic Substances
Control Act, as amended (15 U.S.C. Section 2601 et seq.), the
Occupational Safety and Health Act of 1970, as amended (29 U.S.C.
Section 651, et seq.), the Hazardous Materials Transportation Act,
as amended (49 U.S.C. Section 1801, et seq.), 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
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"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 holdsparticipating interests in such mortgages and
deeds of trust.
(27) The partnership agreement of the Operating Partnership
(the "Operating Partnership Agreement") has been duly authorized,
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
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REIT for 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.
(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 Notes, 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.
(32) To the Operating Partnership's knowledge after due
inquiry, the Medium-Term Note Program under which the Notes are
issued (the "Program"), as well as the Notes, are rated Baa1 by
Moody's Investors Service, Inc. and BBB+ by Standard & Poor's
Ratings Service, or such other rating as to which the Operating
Partnership shall have most recently notified the Agents pursuant
to Section 4(b) hereof.
(b) Additional Certifications. Any certificate signed by any officer of
the Operating Partnership (or any officer of the Company) or any of its
Subsidiaries and delivered to one or more Agents or to counsel for the Agents
in connection with an offering of Notes to one or more Agents as principal or
through an Agent as agent shall be deemed a representation and warranty by the
Operating Partnership to such Agent or Agents as to the matters covered thereby
on the date of such certificate and, unless subsequently amended or
supplemented, at each Representation Date subsequent thereto.
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SECTION 3. Purchases as Principal; Solicitations as Agent.
(a) Purchases as Principal. Unless otherwise agreed between an Agent and
the Operating Partnership, Notes shall be purchased by such Agent as principal.
Notes purchased from the Operating Partnership by the Agents, individually or
in a syndicate, as principal shall be made in accordance with terms agreed upon
between such Agent or Agents and the Operating Partnership (which terms, unless
otherwise agreed, shall, to the extent applicable, include those terms
specified in Exhibit A hereto and shall be agreed upon orally, with written
confirmation prepared by such Agent or Agents and mailed to the Operating
Partnership). An Agent's commitment to purchase Notes as principal shall be
deemed to have been made on the basis of the representations and warranties of
the Operating Partnership herein contained and shall be subject to the terms
and conditions herein set forth. Unless the context otherwise requires,
references herein to "this Agreement" shall include the applicable agreement of
one or more Agents to purchase Notes from the Operating Partnership as
principal. Each purchase of Notes, unless otherwise agreed, shall be at a
discount from the principal amount of each such Note equivalent to the
applicable commission set forth in Schedule A hereto. The Agents may engage
the services of any broker or dealer in connection with the resale of the Notes
purchased by them as principal and may allow all or any portion of the discount
received from the Operating Partnership in connection with such purchases to
such brokers or dealers. At the time of each purchase of Notes from the
Operating Partnership by one or more Agents as principal, such Agent or Agents
shall specify the requirements for the officers' certificate, opinions of
counsel and comfort letter, if any, pursuant to Sections 8(b), 8(c) and 8(d)
hereof.
(b) Solicitations as Agent. On the basis of the representations and
warranties herein contained, and subject to the terms and conditions herein set
forth, when agreed by the Operating Partnership and an Agent, such Agent, as an
agent of the Operating Partnership, will use its reasonable efforts to solicit
offers for the purchase of Notes upon the terms set forth in the Prospectus.
The Agents are not authorized to appoint sub-agents with respect to Notes sold
through them as agent. All Notes sold through an Agent as agent will be sold
at 100% of their principal amount unless otherwise agreed upon between the
Operating Partnership and such Agent.
The Operating Partnership reserves the right, in its sole discretion, to
suspend solicitation of offers for the purchase of Notes through an Agent, as
an agent of the Operating Partnership, commencing at any time for any period of
time or permanently. As soon as practicable after receipt of instructions from
the Operating Partnership, such Agent will suspend solicitation of offers for
the purchase of Notes from the Operating Partnership until such time as the
Operating Partnership has advised such Agent that such solicitation may be
resumed.
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The Operating Partnership agrees to pay each Agent a commission, in the
form of a discount, equal to the applicable percentage of the principal amount
of each Note sold by the Operating Partnership as a result of a solicitation
made by such Agent, as an agent of the Operating Partnership, as set forth in
Schedule A hereto.
(c) Administrative Procedures. The purchase price, interest rate or
formula, maturity date and other terms of the Notes specified in Exhibit A
hereto (as applicable) shall be agreed upon between the Operating Partnership
and the applicable Agent(s) and specified in a pricing supplement to the
Prospectus (each, a "Pricing Supplement") to be prepared by the Operating
Partnership in connection with each sale of Notes. Except as otherwise
specified in the applicable Pricing Supplement, the Notes will be issued in
denominations of U.S. $1,000 or any larger amount that is an integral multiple
of U.S. $1,000. The Agents and the Operating Partnership agree to perform, and
the Operating Partnership agrees to cause the Trustee to agree to perform,
their respective duties and obligations specifically provided to be performed
by them in the Administrative Procedures set forth in Exhibit B hereto (the
"Procedures").
SECTION 4. Covenants of the Operating Partnership.
Each of the Operating Partnership and the Company covenants and agrees
with each Agent as follows:
(a) Preparation of Pricing Supplements. The Operating Partnership
will prepare, with respect to any Notes to be sold to or through one or more
Agents pursuant to this Agreement, a Pricing Supplement with respect to such
Notes in a form previously approved by the Agents. The Operating Partnership
will use its best efforts to deliver such Pricing Supplement no later than
11:00 a.m., New York City time, on the business day following the date of the
Operating Partnership's acceptance of the offer for the purchase of such Notes
and will file such Pricing Supplement pursuant to Rule 424(b)(3) under the 1933
Act not later than the close of business of the Commission on the fifth
business day after the date on which such Pricing Supplement is first used.
(b) Notice of Certain Events. The Operating Partnership will notify the
Agents immediately, and confirm such notice in writing, of (i) the
effectiveness of any post-effective amendment to the Registration Statement or
the filing of any amendment or supplement to the Prospectus (other than any
amendment or supplement thereto providing solely for the determination of the
variable terms of the Notes or relating solely to the offering of securities
other than the Notes), (ii) the receipt of any comments from the Commission
with respect to the Registration Statement or the Prospectus, including any
documents incorporated therein by reference, (iii) any request by the
Commission for any amendment to the Registration
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Statement or any amendment or supplement to the Prospectus or for additional
information, (iv) the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement, or of any order preventing or
suspending the use of any preliminary prospectus, or of the initiation of any
proceedings for that purpose or (v) any change in the rating assigned by any
nationally recognized statistical rating organization to the Program or any Debt
Securities (including the Notes) of the Operating Partnership, or the public
announcement by any nationally recognized statistical rating organization that
it has under surveillance or review, with possible negative implications, its
rating of the Program or any such Debt Securities, or the withdrawal by any
nationally recognized statistical rating organization of its rating of the
Program or any such Debt Securities. The Operating Partnership will make every
reasonable effort to prevent the issuance of any stop order and, if any stop
order is issued, to obtain the lifting thereof at the earliest possible moment.
(c) Filing or Use of Amendments. The Operating Partnership will give the
Agents advance notice of its intention to file or prepare any additional
registration statement with respect to the registration of additional Notes,
any amendment to the Registration Statement (including any filing under Rule
462(b) of the 1933 Act Regulations) or any amendment or supplement to the
prospectus included in the Registration Statement at the time it became
effective or to the Prospectus (other than an amendment or supplement thereto
providing solely for the determination of the variable terms of the Notes or
relating solely to the offering of securities other than the Notes), whether
pursuant to the 1933 Act, the 1934 Act or otherwise, will furnish to the Agents
copies of any such document a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file any such document to which
the Agents or counsel for the Agents shall reasonably object.
(d) Delivery of the Registration Statement. The Operating
Partnership has furnished to each Agent and to counsel for the Agents, 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. Copies of the Registration Statement and
each amendment thereto furnished to the Agents will be identical to any
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.
(e) Delivery of the Prospectus. The Operating Partnership will deliver
to each Agent, without charge, as many copies of each preliminary prospectus as
such Agent 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 Agent, without charge, such number
of copies of the
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Prospectus (as amended or supplemented) as such Agent may reasonably request.
The Prospectus and any amendments or supplements thereto furnished to the Agents
will be identical to any electronically transmitted copies thereof filed with
the Commission pursuant to EDGAR, except to the extent permitted by Regulation
S-T.
(f) Revisions of Prospectus -- Material Changes. Except as otherwise
provided in subsection (m) of this Section 4, if at any time during the term of
this Agreement any event shall occur or condition shall exist as a result of
which it is necessary, in the reasonable opinion of counsel for the Agents or
counsel for the Operating Partnership, to amend the Registration Statement in
order that the Registration Statement will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or to amend or
supplement the Prospectus in order that the Prospectus will not contain an
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein not misleading in light of the circumstances
existing at the time the Prospectus is delivered to a purchaser, or if it shall
be necessary, in the reasonable opinion of either such counsel, to amend the
Registration Statement or amend or supplement the Prospectus in order to comply
with the requirements of the 1933 Act or the 1933 Act Regulations, the Operating
Partnership shall give immediate notice, confirmed in writing, to the Agents to
cease the solicitation of offers for the purchase of Notes in their capacity as
agents and to cease sales of any Notes they may then own as principal, and the
Operating Partnership will promptly prepare and file with the Commission,
subject to Section 4(c) hereof, such amendment or supplement, in form and
substance reasonably satisfactory to counsel for the Agents, as may be necessary
to correct such statement or omission or to make the Registration Statement and
Prospectus comply with such requirements, and the Operating Partnership will
furnish to the Agents, without charge, such number of copies of such amendment
or supplement as the Agents may reasonably request. In addition, the Operating
Partnership will comply with the 1933 Act, the 1933 Act Regulations, the 1934
Act and the 1934 Act Regulations so as to permit the completion of the
distribution of each offering of Notes.
(g) Prospectus Revisions -- Periodic Financial Information. Except as
otherwise provided in subsection (m) of this Section 4, on or prior to the date
on which there shall be released to the general public interim financial
statement information related to the Operating Partnership with respect to each
of the first three quarters of any fiscal year or preliminary financial
statement information with respect to any fiscal year, the Operating
Partnership shall furnish such information to the Agents, confirmed in writing,
and shall cause the Prospectus to include or incorporate by reference financial
information with respect thereto and corresponding information for the
comparable period of the preceding fiscal year, as well as such other
information and explanations as shall be necessary for an understanding thereof
or as shall be required by the 1933 Act or the 1933 Act Regulations.
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(h) Prospectus Revisions -- Audited Financial Information. Except as
otherwise provided in subsection (m) of this Section 4, on or prior to the date
on which there shall be released to the general public financial information
included in or derived from the audited consolidated financial statements of
the Operating Partnership for the preceding fiscal year, the Operating
Partnership shall furnish such information to the Agents, confirmed in writing,
and shall cause the Prospectus to include or incorporate by reference such
audited consolidated financial statements and the report or reports, and
consent or consents to such inclusion or incorporation by reference, of the
independent accountants with respect thereto, as well as such other information
and explanations as shall be necessary for an understanding of such
consolidated financial statements or as shall be required by the 1933 Act or
the 1933 Act Regulations.
(i) Earning Statements. The Operating Partnership will timely file such
reports pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earning statement
for the purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the 1933 Act.
(j) Use of Proceeds. The Operating Partnership will use the net proceeds
received by it from the issuance and sale of the Notes in the manner specified
in the Prospectus.
(k) Restriction on Offers and Sales of Securities. Unless otherwise
agreed upon between one or more Agents acting as principal and the Operating
Partnership, between the date of the agreement by such Agent(s) to purchase the
related Notes from the Operating Partnership and the Settlement Date with
respect thereto, the Operating Partnership will not, without the prior written
consent of such Agent(s), issue, sell, offer or contract to sell, grant any
option for the sale of, or otherwise dispose of, any debt securities of the
type which could be offered under the Program of the Operating Partnership
(other than the Notes that are to be sold pursuant to such agreement or
commercial paper in the ordinary course of business).
(l) Reporting Requirements. The Operating Partnership, during the period
when the Prospectus is required to be delivered under the 1933 Act or the 1934
Act in connection with sales of the Notes, will file all documents required to
be filed with the Commission pursuant to Sections 13, 14 and 15 of the 1934 Act
within the time periods prescribed by the 1934 Act and the 1934 Act
Regulations.
(m) Suspension of Certain Obligations. The Operating Partnership shall
not be required to comply with the provisions of subsection (f), (g) or (h) of
this Section 4
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during any period from the time (i) the Operating Partnership requests that the
Agents shall have suspended solicitation of offers for the purchase of Notes
in their capacity as agents (provided, however, that such suspension shall be
automatic, unless an Agent is holding Notes as principal as described in clause
(ii) below, from the time the Operating Partnership shall have released to the
general public interim or audited financial information as described in
Sections 4(g) or (h) until the earlier to occur of (a) the filing of a
Quarterly Report on Form 10-Q or an Annual Report on Form 10-K, (b) the filing
of the interim or audited financial information as described in Sections 4(g)
or (h) pursuant to a Current Report on Form 8-K or (c) a verbal request by the
Operating Partnership to any Agent that such Agent resume solicitation of
offers for the purchase of Notes) and (ii) no Agent shall then hold any Notes
purchased from the Operating Partnership as principal less than 180 days prior
to such date (unless, in the discretion of any Agent then holding Notes as
principal, such Agent waives the requirements of this clause (ii)), as the
case may be, until the time the Operating Partnership shall determine that
solicitation of offers for the purchase of Notes should be resumed or an Agent
shall subsequently purchase Notes from the Operating Partnership as principal.
SECTION 5. Payment of Expenses.
The Operating Partnership will pay all expenses incident to the
performance of its obligations under this Agreement, including: (a) the
preparation, filing, printing and delivery of the Registration Statement
(including financial statements and exhibits) as originally filed and all
amendments thereto and any preliminary prospectus, the Prospectus and any
amendments or supplements thereto; (b) the preparation and delivery of this
Agreement, the Indenture and such other documents as may be required in
connection with the offering, purchase, sale and delivery of the Notes; (c) the
preparation, issuance and delivery of the Notes, including any fees and
expenses relating to the eligibility and issuance of Notes in book-entry form
and the cost of obtaining CUSIP or other identification numbers for the Notes;
(d) the reasonable fees and disbursements of the Operating Partnership's
accountants, counsel and other advisors or agents (including any calculation
agent or exchange rate agent) and of the fees and disbursements of the Trustee;
(e) the reasonable fees and disbursements of counsel to the Agents incurred in
connection with the establishment of the Program and incurred from time to time
in connection with the transactions contemplated hereby; (f) the fees charged
by nationally recognized statistical rating organizations for the rating of the
Program and the Notes; (g) the fees and expenses incurred in connection with
any listing of Notes on a securities exchange; (h) the filing fees incident to,
and the reasonable fees and disbursements of counsel to the Agents in
connection with, the review, if any, by the NASD of the terms of the sale of
the Notes; (i) any advertising and other out-of-pocket expenses of the Agents
relating to the Notes reasonably incurred with the approval of the Operating
Partnership; and (j) the preparation, issuance and delivery to the Depository
Trust Company for credit to the accounts of the Agent(s) of any global note
registered in the name of Cede & Co., as nominee for the Depository Trust
Company.
SECTION 6. Conditions of Agents' Obligations.
The obligations of one or more Agents to purchase Notes from the Operating
Partnership as principal and to solicit offers for the purchase of Notes as an
agent of the Operating Partnership, and the obligations of any purchasers of
Notes sold through an Agent as an agent of the Operating Partnership, will be
subject to the accuracy of the representations and warranties on the part of
the Operating Partnership herein contained or contained in any certificate of
an officer of the
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Operating Partnership, the Company or any Subsidiary delivered pursuant to the
provisions hereof, to the performance and observance by the Operating
Partnership of its covenants and other obligations hereunder, and to the
following additional conditions precedent:
(a) (i) The Registration Statement (including any Rule 462(b)
Registration Statement) shall be effective under the 1933 Act and no stop order
suspending the effectiveness of the Registration Statement shall have been
issued under the 1933 Act and no proceedings for that purpose shall have been
instituted or shall be pending or threatened by the Commission, and any
request on the part of the Commission for additional information shall have
been complied with to the reasonable satisfaction of counsel to the Agents,
(ii) the rating assigned by any nationally recognized statistical rating
organization to the Notes or any Debt Securities of the Operating Partnership
as of the applicable Representation Date shall not have been lowered since such
date nor shall any such rating organization have publicly announced that it has
placed the Notes or any Debt Securities of the Operating Partnership on what
is commonly termed a "watch list" for possible downgrading; and (iii) there
shall not have come to an Agent's attention any facts that would cause such
Agent to reasonably believe that the Prospectus, together with the applicable
Prospectus Supplement, at the time it was required to be delivered to
purchasers of the Notes, 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) The Agents shall have received the opinion, dated as of the date
hereof, of King & Spalding, counsel for the Company, the Operating Partnership
and the Subsidiaries, in form and substance satisfactory to counsel for the
Agents, 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 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. and RAM Partners, Inc. and any
Significant Subsidiary within the meaning of Rule 1-02 of
Regulation S-X (collectively, the "Significant Subsidiaries") 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
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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 or 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 Notes 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.
(iv) The Notes 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 this 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
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(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 Notes 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) This 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.
(vi) The execution and delivery of this Agreement by the
Operating Partnership, and the performance by the Operating
Partnership of its obligations hereunder and the consummation of
the transactions contemplated hereunder, 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 the 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
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 Notes 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,
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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 Indenture
or the Notes, 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 Notes.
(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 (A) in the Prospectus and the applicable
Prospectus Supplement under the headings "Description of Debt
Securities," "Description of Notes" and "Certain United States
Federal Income Tax Considerations" and (B) in the Operating
Partnership's Form 10 under "Recent Sales of Unregistered
Securities," to the extent that it constitutes matters of law or
legal 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
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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 for
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) The Agents shall have received the opinion, dated as
of the date hereof, of Hogan & Hartson L.L.P., counsel for the Agents,
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 6(b) above.
(d) In rendering their opinions required by Sections 6(b) and 6(c),
respectively, King & Spalding and Hogan & Hartson L.L.P. shall each
additionally state (which shall not constitute an opinion) that no facts
have 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 Agreement, contained an untrue statement
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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 this Agreement, 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 6(b) and 6(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 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 Agents. In giving their belief required
in this Section 6(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) On the date hereof, there shall not have been, since the respective
dates as of which information is given in the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Operating Partnership and
its Subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, and the Agents shall have received a certificate
of the President or a Vice President of the Company and of the chief financial
officer and chief accounting officer of the Company, dated as of the date
hereof, to the effect that (i) there has been no such material adverse change,
(ii) the representations and warranties of the Operating Partnership herein
contained are true and correct with the same force and effect as though
expressly made at and as of the date of such certificate, (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 date of such
certificate, and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been instituted or are pending or, to the best of such officers' knowledge, are
threatened by the Commission.
(f) The Agents shall have received a letter from Price Waterhouse LLP,
dated as of the date hereof, in form and substance satisfactory to the Agents,
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
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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) the date of the latest available
consolidated interim financial data, 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 the date of the latest available consolidated interim financial
data, 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 occur; (iv) based upon inquiries of certain officials of the
Company who have responsiblity for financial and accounting matters, nothing
came to our attention that (A) there was any change at a specified date not
more than five days prior to the date hereof in the capital stock, increase in
debt or any decreases in consolidated net assets, stockholders' equity and
accumulated earnings, partners' equity, as applicable, of the Company as
compared with amounts shown on the most recent consolidated balance sheets
included or incorporated by reference in the Registration Statement and the
Prospectus, or (B) for the period from the date of the latest available
consolidated interim financial data to a specified date not more than five
days prior to the date hereof, there were any decreases, as compared with the
corresponding period in the preceding year, in consolidated revenues or in the
total amount of income before extraordinary items or of net income, except in
all instances for changes or decreases which the Registration Statement and
Prospectus discloses have occurred or may occur and (v) 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) On the date hereof, counsel to the Agents shall have been furnished
with such documents and opinions as such counsel may require for the purpose of
enabling such counsel to pass upon the issuance and sale of Notes as herein
contemplated, or in order to evidence the accuracy of any of the
representations and warranties, or the
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fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Operating Partnership in connection with the issuance and sale of
Notes as herein contemplated shall be satisfactory in form and substance to
the Agents and to counsel to the Agents.
(h) If any condition specified in this Section 6 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be
terminated by the applicable Agent or Agents by notice to the Operating
Partnership at any time and any such termination shall be without liability of
any party to any other party except as provided in Section 5 hereof and except
that Sections 9, 10, 11, 15 and 16 hereof shall survive any such termination
and remain in full force and effect.
SECTION 7. Delivery of and Payment for Notes Sold through an Agent as Agent.
Delivery of Notes sold through an Agent as an agent of the Operating
Partnership shall be made by the Operating Partnership to such Agent for the
account of any purchaser only against payment therefor in immediately available
funds. In the event that a purchaser shall fail either to accept delivery of
or to make payment for a Note on the date fixed for settlement, such Agent
shall promptly notify the Operating Partnership and deliver such Note to the
Operating Partnership and, if such Agent has theretofore paid the Operating
Partnership for such Note, the Operating Partnership will promptly return such
funds to such Agent. If such failure has occurred for any reason other than
default by such Agent in the performance of its obligations hereunder, the
Operating Partnership will reimburse such Agent on an equitable basis for its
loss of the use of the funds for the period such funds were credited to the
Operating Partnership's account.
SECTION 8. Additional Covenants of the Operating Partnership.
The Operating Partnership further covenants and agrees with each Agent as
follows:
(a) Reaffirmation of Representations and Warranties. Each acceptance by
the Operating Partnership of an offer for the purchase of Notes (whether to one
or more Agents as principal or through an Agent as agent), and each delivery of
Notes (whether to one or more Agents as principal or through an Agent as
agent), shall be deemed to be an affirmation that the representations and
warranties of the Operating Partnership herein contained and contained in any
certificate theretofore delivered to the Agents pursuant hereto are true and
correct at the time of such acceptance or sale, as the case may be, and an
undertaking that such representations and warranties will be true and correct
at the time of delivery to such Agent(s) or to the purchaser or its agent, as
the case may be, of the Notes relating to such acceptance or sale, as the case
may be, as though made at and as of each such time (it being understood that
such representations and warranties shall relate to the Registration
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Statement and Prospectus as amended and supplemented to each such time, other
than an amendment or supplement relating to the offering of securities other
than the Notes).
(b) Subsequent Delivery of Certificates. Each time that (i) the
Operating Partnership shall file a Form 10-K or Form 10-Q with the Commission,
unless otherwise waived by the Agents, (ii) the Registration Statement or the
Prospectus shall be amended or supplemented (other than by an amendment or
supplement providing solely for the determination of the variable terms of the
Notes, the filing of a Form 10-K or Form 10-Q with the Commission or relating
solely to the offering of securities other than the Notes), if requested in
writing by the Agents or Agents (iii) (if requested in writing by the Agent or
Agents) the Operating Partnership sells Notes to one or more Agents as
principal or (iv) the Operating Partnership sells Notes in a form not
previously certified to the Agents by the Operating Partnership, the Operating
Partnership shall furnish or cause to be furnished to the Agent(s) forthwith a
certificate dated the date of filing with the Commission or the date of
effectiveness of such amendment or supplement, as applicable, or the date of
such sale, as the case may be, in form satisfactory to the Agent(s) to the
effect that the statements contained in the certificate referred to in Section
6(e) hereof which were last furnished to the Agents are true and correct at the
time of the filing or effectiveness of such amendment or supplement, as
applicable, or the time of such sale, as the case may be, as though made at and
as of such time (except that such statements shall be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented to such
time) or, in lieu of such certificate, a certificate of the same tenor as the
certificate referred to in Section 6(e) hereof, modified as necessary to relate
to the Registration Statement and the Prospectus as amended and supplemented to
the time of delivery of such certificate (it being understood that, in the case
of clause (iii) above, any such certificate shall also include a certification
that there has been no material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Operating Partnership and its Subsidiaries considered as one enterprise since
the date of the agreement by such Agent(s) to purchase Notes from the Operating
Partnership as principal).
(c) Subsequent Delivery of Legal Opinions. Each time that (i) the
Operating Partnership shall file a Form 10-K or Form 10-Q with the Commission,
unless otherwise waived by the Agents, (ii) the Registration Statement or the
Prospectus shall be amended or supplemented (other than by an amendment or
supplement providing solely for the determination of the variable terms of the
Notes, the filing of a Form 10-K or Form 10-Q with the Commission or relating
solely to the offering of securities other than the Notes), if requested in
writing by the Agent or Agents (iii) (if requested in writing by the Agent or
Agents) the Operating Partnership sells Notes to one or more Agents as
principal or (iv) the Operating Partnership sells Notes in a form not
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previously certified to the Agents by the Operating Partnership, the Operating
Partnership shall furnish or cause to be furnished forthwith to the Agent(s)
and to counsel to the Agents the written opinion of King & Spalding, counsel to
the Operating Partnership, or other counsel reasonably satisfactory to the
Agent(s), dated the date of filing with the Commission or the date of
effectiveness of such amendment or supplement, as applicable, or the date of
such sale, as the case may be, in form and substance reasonably satisfactory
to the Agent(s), of the same tenor as the opinion referred to in Section 6(b)
hereof, but modified, as necessary, to relate to the Registration Statement and
the Prospectus as amended and supplemented to the time of delivery of such
opinion or, in lieu of such opinion, counsel last furnishing such opinion to
the Agents shall furnish the Agent(s) with a letter substantially to the
effect that the Agent(s) may rely on such last opinion to the same extent as
though it was dated the date of such letter authorizing reliance (except that
statements in such last opinion shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of
delivery of such letter authorizing reliance); except for the opinion required
under Section 6(b)(xv).
(d) Subsequent Delivery of Comfort Letters. Each time that (i) the
Operating Partnership shall file a Form 10-K or a Form 10-Q with the
Commission, unless otherwise waived by the Agents, (ii) the Registration
Statement or the Prospectus shall be amended or supplemented (other than by an
amendment or supplement providing solely for the determination of the variable
terms of the Notes, the filing of a Form 10-K or Form 10-Q with the Commission
or relating solely to the offering of securities other than the Notes) if
requested in writing by the Agent or Agents or (iii) (if requested in writing by
the Agent or Agents) the Operating Partnership sells Notes to one or more
Agents as principal, the Operating Partnership shall cause Price Waterhouse
L.L.P. or such other accounting firm that has certified the financial
statements and supporting schedules included in or incorporated by reference
into the Registration Statement and the Prospectus to the Agent(s) a letter,
dated the date of filing with the Commission or the date of effectiveness of
such amendment or supplement, as applicable, or the date of such sale, as the
case may be, in form reasonably satisfactory to the Agent(s), of the same tenor
as the letter referred to in Section 6(f) hereof but modified to relate to the
Registration Statement and Prospectus as amended and supplemented to the date
of such letter.
SECTION 9. Indemnification.
(a) Indemnification of the Agents. The Operating Partnership agrees to
indemnify and hold harmless each Agent and each person, if any, who controls
such Agent 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:
(i) 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
deemed to be a part
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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;
(ii) 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 any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, provided that (subject to Section
9(d) hereof) any such settlement is effected with the written consent of
the Operating Partnership; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by such Agent),
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
subparagraph (i) or (ii) above;
provided, however, that this indemnity 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
the Agents expressly for use in the Registration Statement (or any amendment
thereto), including the Rule 430A information deemed to be a part thereof, if
applicable, or any preliminary prospectus or the Prospectus (or any amendment
or supplement thereto).
(b) Indemnification of Operating Partnership, Directors and Officers.
Each Agent 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 Section 9(a) hereof, 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 deemed to be a part thereof, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance
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upon and in conformity with written information furnished to the Operating
Partnership by the Agents 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) Actions Against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve
such indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section
9(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 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 one 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 9 or 10 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) Settlement without Consent if Failure to Reimburse. 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 9(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.
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SECTION 10. Contribution.
If the indemnification provided for in Section 9 hereof is for any reason
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, liabilities, claims, damages or expenses referred to therein,
then each indemnifying party shall contribute to the aggregate amount of such
losses, liabilities, claims, damages and expenses incurred by such indemnified
party, as incurred, (i) in such proportion as is appropriate to reflect the
relative benefits received by the Operating Partnership, on the one hand, and
the applicable Agent(s), on the other hand, from the offering of the Notes that
were the subject of the claim for indemnification 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 the applicable Agent(s), 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 applicable Agent(s), on the other hand, in connection with the
offering of the Notes that were the subject of the claim for indemnification
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of such Notes (before deducting expenses) received
by the Operating Partnership and the total discount or commission received by
each applicable Agent, as the case may be, bears to the aggregate initial
offering price of such Notes.
The relative fault of the Operating Partnership, on the one hand, and the
applicable Agent(s), 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 omission or alleged omission to state a material fact relates
to information supplied by the Operating Partnership or by the applicable
Agent(s) and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Operating Partnership and the Agents agree that it would not be just
and equitable if contribution pursuant to this Section 10 were determined by
pro rata allocation (even if the applicable Agent(s) 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 10.
The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 10 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
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38
based upon any applicable untrue or alleged untrue statement or omission or
alleged omission.
Notwithstanding the provisions of this Section 10, no Agent shall be
required to contribute any amount in excess of the amount by which the total
discount or commission received by such Agent in connection with the offering
of the Notes that were the subject of the claim for indemnification exceeds the
amount of any damages which such Agent has otherwise been required to pay by
reason of any applicable untrue or alleged untrue statement or omission or
alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
In addition, in connection with an offering of Notes purchased from the
Operating Partnership by two or more Agents as principal, the respective
obligations of such Agents to contribute pursuant to this Section 10 are
several, and not joint, in proportion to the aggregate principal amount of
Notes that each such Agent has agreed to purchase from the Operating
Partnership.
For purposes of this Section 10, each person, if any, who controls an
Agent 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 Agent, 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.
SECTION 11. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement
or in certificates of officers of the Company 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 investigation
made by or on behalf of any of the Agents or any controlling person of an
Agent, or by or on behalf of the Company and the Operating Partnership, and
shall survive each delivery of and payment for the Notes.
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SECTION 12. Termination.
(a) Termination of this Agreement. This Agreement (excluding any
agreement by one or more Agents to purchase Notes from the Operating
Partnership as principal) may be terminated for any reason, at any time by
either the Operating Partnership or an Agent, as to itself, upon the giving of
30 days' prior written notice of such termination to the other party hereto,
but without prejudice to any rights, obligations or liabilities of any party
hereto accrued or incurred prior to such termination.
(b) Termination of Agreement to Purchase Notes as Principal. The
applicable Agent(s) may terminate any agreement by such Agent(s) to purchase
Notes from the Operating Partnership as principal, immediately upon notice to
the Operating Partnership, at any time prior to the Settlement Date relating
thereto, if (i) there has been, since the date of such 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 Notes are denominated or payable in, or indexed to, one or
more foreign or composite currencies, in the international financial markets,
or any outbreak of hostilities or escalation thereof or other calamity or
crisis or any change or development involving a prospective change in national
or international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of such Agent(s),
impracticable to market such Notes or enforce contracts for the sale of such
Notes, 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 or the American Stock Exchange 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, or
(iv) a banking moratorium has been declared by either Federal or New York
authorities or if the Notes are denominated or payable in, or indexed to, one
or more foreign or composite currencies, by the relevant authorities in the
related country or countries, or (v) the rating assigned by any nationally
recognized statistical rating organization to the Program or any Debt
Securities (including the Notes) of the Operating Partnership as of the date of
such 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, the Program or any such debt securities of the Operating
Partnership on what is commonly termed a "watch list" for possible downgrading.
39
40
(c) General. In the event of any such termination, such termination
shall be without liability of any party to any other party except that (i) the
Agents shall be entitled to any commissions earned in accordance with the third
paragraph of Section 3(b) hereof, (ii) if at the time of termination (a) any
Agent shall own any Notes purchased by it from the Operating Partnership as
principal or (b) an offer to purchase any of the Notes has been accepted by the
Operating Partnership but the time of delivery to the purchaser or his agent of
such Notes relating thereto has not occurred, the covenants set forth in
Sections 4 and 8 hereof shall remain in effect until the earlier of (A) such
Notes are so resold or delivered or (B) 180 days, as the case may be, and (iii)
the covenant set forth in Section 4(i) hereof, the provisions of Section 5
hereof, the indemnity and contribution agreements set forth in Sections 9 and
10 hereof, and the provisions of Sections 11, 15 and 16 hereof shall survive
such termination and remain in full force and effect.
SECTION 13. Default by One or More of the Agents.
If the Operating Partnership and two or more Agents enter into an
agreement pursuant to which such Agents agree to purchase Notes from the
Operating Partnership as principal and one or more of such Agents shall fail at
the Settlement Date to purchase the Notes which it or they are obligated to
purchase (the "Defaulted Notes"), then the nondefaulting Agents shall have the
right, within 24 hours thereafter, to make arrangements for one of them or one
or more other Agents to purchase all, but not less than all, of the Defaulted
Notes in such amounts as may be agreed upon and upon the terms herein set
forth; provided, however, that if such arrangements shall not have been
completed within such 24-hour period, then:
(i) if the aggregate principal amount of Defaulted Notes does not
exceed 10% of the aggregate principal amount of Notes to be so purchased
by all of such Agents on the Settlement Date, the nondefaulting Agents
shall be obligated, severally and not jointly, to purchase the full
amount thereof in the proportions that their respective initial
underwriting obligations bear to the underwriting obligations of all
nondefaulting Agents, or
(ii) if the aggregate principal amount of Defaulted Notes exceeds
10% of the aggregate principal amount of Notes to be so purchased by all
of such Agents on the Settlement Date, such agreement shall terminate
without liability on the part of any nondefaulting Agent.
No action taken pursuant to this paragraph shall relieve any defaulting Agent
from liability in respect of its default.
In the event of any such default which does not result in a termination of
such agreement, either the nondefaulting Agents or the Operating Partnership
shall have the right to postpone the Settlement Date for a period not exceeding
seven days in
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41
order to effect any required changes in the Registration Statement or the
Prospectus or in any other documents or arrangements.
SECTION 14. 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 Agents 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: MTN
Product Management and J.P. Morgan Securities Inc., 60 Wall Street, Medium-Term
Note Desk - 3rd Floor, New York, New York 10260 and notices to the Company and
the Operating Partnership shall be directed to them at 3350 Cumberland Circle,
N.W., Suite 2200, Atlanta, Georgia 30339, attention: John T. Glover,
President.
SECTION 15. Parties.
This Agreement shall inure to the benefit of and be binding upon the
Agents and the Operating Partnership and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the parties hereto and their
respective successors and the controlling persons, officers and directors
referred to in Sections 9 and 10 hereof and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement
and all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the parties hereto and their respective successors, and
said controlling persons, officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation.
No purchaser of Notes from any Agent shall be deemed to be a successor by
reason merely of such purchase.
SECTION 16. GOVERNING LAW; FORUM.
THIS AGREEMENT AND ALL THE RIGHTS AND OBLIGATIONS OF THE PARTIES 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.
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SECTION 17. Effect of Headings.
The Article and Section headings herein are for convenience only and shall
not affect the construction hereof.
SECTION 18. Counterparts.
This Agreement may be executed in one or more counterparts and, if
executed in more than one counterpart, the executed counterparts hereof shall
constitute a single instrument.
If the foregoing is in accordance with the Agents' understanding of our
agreement, please sign and return to the Operating Partnership a counterpart
hereof, whereupon this Distribution Agreement, along with all counterparts,
will become a binding agreement among the Agents and the Operating Partnership
in accordance with its terms.
Very truly yours,
POST APARTMENT HOMES, L.P.
By: Post Properties, Inc., its general
partner
By:/s/ John T. Glover
----------------------------------
Name: John T. Glover
Title: Chief Operating
Officer
CONFIRMED AND ACCEPTED,
AS OF THE DATE FIRST ABOVE WRITTEN:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By:/s/ Scott Primrose
----------------------------------
Authorized Signatory
J.P. MORGAN SECURITIES INC.
By:/s/ Keysha Bailey
----------------------------------
Authorized Signatory
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EXHIBIT A
The following terms, if applicable, shall be agreed to by one or more
Agents and the Operating Partnership in connection with each sale of Notes:
Principal Amount: $_______
(or principal amount of foreign currency or composite currency)
Interest Rate or Formula:
If Fixed Rate Note,
Interest Rate:
Interest Payment Dates:
If Floating Rate Note,
Interest Rate Basis(es):
If LIBOR,
o LIBOR Reuters Page:
o LIBOR Telerate Page:
Designated LIBOR Currency:
If CMT Rate,
Designated CMT Telerate Page:
Designated CMT Maturity Index:
o Weekly Average
o Monthly Average
Index Maturity:
Spread and/or Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Payment Dates:
Default Rate:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Fixed Interest Rate, if any:
Day Count Convention:
Calculation Agent:
Redemption Provisions:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
Repayment Provisions:
Optional Repayment Date(s):
Original Issue Date:
Stated Maturity Date:
Specified Currency:
Exchange Rate Agent:
Authorized Denomination:
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Purchase Price: ___%, plus accrued interest, if any, from ___________
Issue Price:
Price to Public: ___%, plus accrued interest, if any,
from ___________
Settlement Date and Time:
Additional/Other Terms:
Also, in connection with the purchase of Notes from the Operating Partnership
by one or more Agents as principal, agreement as to whether the following will
be required:
Officers' Certificate pursuant to Section 8(b) of the Distribution
Agreement.
Legal Opinions pursuant to Section 8(c) of the Distribution Agreement.
Comfort Letter pursuant to Section 8(d) of the Distribution Agreement.
Stand-off Agreement pursuant to Section 4(k) of the Distribution
Agreement.
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SCHEDULE A
As compensation for the services of the Agents hereunder, the Operating
Partnership shall pay the applicable Agent, on a discount basis, a commission
for the sale of each Note equal to the principal amount of such Note multiplied
by the appropriate percentage set forth below:
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
- --------------- ----------------
From 9 months to less than 1 year .................... .125%
From 1 year to less than 18 months ................... .150
From 18 months to less than 2 years .................. .200
From 2 years to less than 3 years .................... .250
From 3 years to less than 4 years .................... .350
From 4 years to less than 5 years .................... .450
From 5 years to less than 6 years .................... .500
From 6 years to less than 7 years .................... .550
From 7 years to less than 10 years ................... .600
From 10 years to less than 15 years .................. .625
From 15 years to less than 20 years .................. .700
From 20 years to 30 years ............................ .750
Greater than 30 years ................................ *
- ----------------------
*As agreed to by the Operating Partnership and the applicable Agent at the time
of sale.
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EXHIBIT B
POST APARTMENT HOMES, L.P.
ADMINISTRATIVE PROCEDURES
FOR FIXED RATE AND FLOATING RATE MEDIUM-TERM NOTES
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
(Dated as of January 29, 1997)
Medium-Term Notes Due Nine Months or More from Date of Issue (the "Notes")
are to be offered on a continuing basis by Post Apartment Homes, L.P., a Georgia
limited partnership (the "Operating Partnership"), to or through Merrill Lynch
& Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated and J.P. Morgan
Securities Inc. (each, an "Agent" and, collectively, the "Agents") pursuant to
a Distribution Agreement, dated January 29, 1997 (the "Distribution
Agreement"), by and among the Operating Partnership and the Agents. The
Distribution Agreement provides both for the sale of Notes by the Operating
Partnership to one or more of the Agents as principal for resale to investors
and other purchasers and for the sale of Notes by the Operating Partnership
directly to investors (as may from time to time be agreed to by the Operating
Partnership and the related Agent or Agents), in which case each such Agent
will act as an agent of the Operating Partnership in soliciting offers to
purchase the Notes.
Unless otherwise agreed by the related Agent or Agents and the Operating
Partnership, Notes will be purchased by the related Agent or Agents as
principal. Such purchases will be made in accordance with terms agreed upon by
the related Agent or Agents and the Operating Partnership (which terms shall be
agreed upon orally, with written confirmation prepared promptly by the related
Agent or Agents and mailed promptly to the Operating Partnership). If agreed
upon by any Agent or Agents and the Operating Partnership, the Agent or Agents,
acting solely as agent or agents for the Operating Partnership and not as
principal, will use reasonable efforts to solicit offers to purchase the Notes.
Only those provisions in these Administrative Procedures that are applicable
to the particular role to be performed by the related Agent or Agents shall
apply to the offer and sale of the relevant Notes.
The Notes will be issued as a series of debt securities under an
Indenture, dated as of September 25, 1996, as amended, supplemented or modified
from time to time (the "Indenture"), between the Operating Partnership and
SunTrust Bank, Atlanta, as trustee (together with any successor in such
capacity, the "Trustee"). Post Properties, Inc., a Georgia corporation (the
"Company") and the Operating Partnership have filed a Registration Statement
with the Securities and Exchange
47
Commission (the "Commission") registering, among other things, debt securities
of the Operating Partnership (which includes the Notes) (the "Registration
Statement"). The most recent base prospectus deemed part of the Registration
Statement, as supplemented with respect to the Notes, is herein referred to as
"Prospectus." The most recent supplement to the Prospectus setting forth the
purchase price, interest rate or formula, maturity date and other terms of the
Notes (as applicable) is herein referred to as the "Pricing Supplement."
The Notes will either be issued (a) in book-entry form and represented by
one or more fully registered global Notes (each, a "Global Note") delivered to
the Trustee, as custodian for The Depository Trust Company ("DTC"), and
recorded in the book-entry system maintained by DTC, or (b) in certificated
form (each, a "Certificated Note") delivered to the investor or other purchaser
thereof or a person designated by such investor or other purchaser.
General procedures relating to the issuance of all Notes are set forth in
Part I hereof. Additionally, Notes issued in book-entry form will be issued in
accordance with the procedures set forth in Part II hereof and Certificated
Notes will be issued in accordance with the procedures set forth in Part III
hereof. Capitalized terms used but not otherwise defined herein shall have the
meanings ascribed thereto in the Indenture or the Notes, as the case may be.
PART I: PROCEDURES OF GENERAL
APPLICABILITY
Date of Issuance/
Authentication: Each Note will be dated as of the date of its
authentication by the Trustee. Each Note shall also
bear an original issue date (each, an "Original
Issue Date"). The Original Issue Date shall remain
the same for all Notes subsequently issued upon
transfer, exchange or substitution of an original
Note regardless of their dates of authentication.
Maturities: Each Note will mature on a date nine months or more
from its Original Issue Date (the "Stated Maturity
Date") selected by the investor or other purchaser
and agreed to by the Operating Partnership.
Registration: Unless otherwise specified in the applicable Pricing
Supplement, Notes will be issued only in fully
registered form.
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Denominations: Unless otherwise specified in the applicable Pricing
Supplement, the Notes will be issued in
denominations of $1,000 and integral multiples
thereof.
Interest Rate Bases: Unless otherwise specified in the applicable Pricing
Supplement, the Notes will bear interest at (A)
fixed rates ("Fixed Rate Notes") or (B) floating
rates ("Floating Rate Notes") determined by
reference to one or more Interest Rate Bases or
formulas, as adjusted by the Spread and/or Spread
Multiplier, if any, applicable to such Floating
Rate Notes.
Redemption/Repayment: The Notes will be subject to redemption by the
Operating Partnership in accordance with the terms
of the Notes, which will be fixed at the time of
sale and set forth in the applicable Note and
Pricing Supplement. If no Initial Redemption Date
is specified on the face of a Note, such Note will
not be redeemable prior to its Stated Maturity Date.
The Notes will be subject to repayment at the
option of the Holders thereof in accordance with the
terms of the Notes, which will be fixed at the time
of sale and set forth in the applicable Note and
Pricing Supplement. If no Optional Repayment Date
is specified on the face of a Note, such Note will
not be repayable at the option of the Holder prior
to its Stated Maturity Date.
Calculation of Interest: Unless otherwise specified in the applicable Pricing
Supplement, interest on each Fixed Rate Note
(including payments for partial periods) will be
calculated and paid on the basis of a 360-day year
of twelve 30-day months.
The interest rate on each Floating Rate Note will be
calculated by reference to the specified Interest
Rate Basis or Bases plus or minus the applicable
Spread, if any, and/or multiplied by the applicable
Spread Multiplier, if any.
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Unless otherwise specified in the applicable
Pricing Supplement, interest on each Floating
Rate Note will be calculated by multiplying its
principal amount by an accrued interest factor.
Such accrued interest factor is computed by
adding the interest factor calculated for each
day in the period for which accrued interest is
being calculated. Unless otherwise specified
in the applicable Pricing Supplement, the
interest factor for each such day is computed
by dividing the interest rate applicable to
such day by 360 if the CD Rate, Commercial
Paper Rate, Eleventh District Cost of Funds
Rate, Federal Funds Rate, LIBOR or Prime Rate
is an applicable Interest Rate Basis, or by
the actual number of days in the year if the
CMT Rate or Treasury Rate is an applicable
Interest Rate Basis. The interest factor for
Notes for which the interest rate is calculated
with reference to two or more Interest Rate
Bases will be calculated in each period in the
same manner as if only the applicable Interest
Rate Basis specified in the applicable Pricing
Supplement applied.
Interest: General. Each Note will bear interest in accordance
with its terms. Unless otherwise specified in
the applicable Pricing Supplement, interest on each
Note will accrue from and including the Original
Issue Date of such Note for the first interest
period or from the most recent Interest Payment Date
(as defined below) to which interest has been paid
or duly provided for all subsequent interest periods
to but excluding the applicable Interest Payment
Date or the Stated Maturity Date or date of earlier
redemption, repayment or acceleration of maturity or
if the maturity of the Note is extended, the new
date of maturity specified in a notice of such
exercise, as the case may be (the Stated Maturity
Date or such earlier or later date, as the case may
be, if referred to herein as the "Maturity Date"
with respect to the principal repayable on such
date).
If an Interest Payment Date or the Maturity Date
with respect to any Fixed Rate Note falls on a day
that is not a Business Day (as defined in the
Prospectus), the required payment to be made on such
day need not
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be made on such day, but may be made on the next
succeeding Business Day with the same force and
effect as if made on such day, and no interest shall
accrue on such payment for the period from and after
such day to the next succeeding Business Day. If an
Interest Payment Date other than the Maturity Date
with respect to any Floating Rate Note would
otherwise fall on a day that is not a Business Day,
such Interest Payment Date will be postponed to the
next succeeding Business Day, except that in the
case of a Note for which LIBOR is an applicable
Interest Rate Basis, if such Business Day falls in
the next succeeding calendar month, such Interest
Payment Date will be the immediately preceding
Business Day. If the Maturity Date with respect to
any Floating Rate Note falls on a day that is not a
Business Day, the required payment to be made on
such day need not be made on such day, but may be
made on the next succeeding Business Day with the
same force and effect as if made on such day, and no
interest shall accrue on such payment for the period
from and after the Maturity Date to the next
succeeding Business Day.
Regular Record Dates. Unless otherwise specified in
the applicable Pricing Supplement, the "Regular
Record Date" for a Note shall be the date 15
calendar days (whether or not a Business Day)
preceding the applicable Interest Payment Date.
Interest Payment Dates. Interest payments will be
made on each Interest Payment Date commencing with
the first Interest Payment Date following the
Original Issue Date; provided, however, the first
payment of interest on any Note originally issued
between a Regular Record Date and an Interest
Payment Date will occur on the Interest Payment Date
immediately following the next succeeding Regular
Record Date.
Unless otherwise specified in the applicable Pricing
Supplement, interest payments on Fixed Rate Notes
will be made semiannually in arrears on May 1 and
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November 1 of each year and on the Maturity Date,
while interest payments on Floating Rate Notes will
be made as specified in the applicable Pricing
Supplement.
Acceptance and
Rejection of Offers
from Solicitation
as Agents: If agreed upon by any Agent and the Operating
Partnership, then such Agent acting solely as
agent for the Operating Partnership and not as
principal will solicit purchases of the Notes. Each
Agent will communicate to the Operating Partnership,
orally or in writing, each reasonable offer to
purchase Notes solicited by such Agent on an agency
basis, other than those offers rejected by such
Agent. Each Agent has the right, in its discretion
reasonably exercised, to reject any proposed
purchase of Notes, as a whole or in part, and any
such rejection shall not be a breach of such Agent's
agreement contained in the Distribution Agreement.
The Operating Partnership has the sole right to
accept or reject any proposed purchase of Notes, in
whole or in part, and any such rejection shall not
constitute a breach of the Operating Partnership's
agreement contained in the Distribution Agreement.
Each Agent has agreed to make reasonable efforts to
assist the Operating Partnership in obtaining
performance by each purchaser whose offer to
purchase Notes has been solicited by such Agent and
accepted by the Operating Partnership.
Preparation of
Pricing Supplement: If any offer to purchase a Note is accepted by the
Operating Partnership, the Operating Partnership will
promptly prepare a Pricing Supplement reflecting
the terms of such Note. Information to be included
in the Pricing Supplement shall include:
1. the name of the Operating Partnership;
2. the title of the Notes;
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3. the date of the Pricing Supplement and the
date of the Prospectus to which the Pricing
Supplement relates;
4. the name of the Offering Agent (as defined
below);
5. whether such Notes are being sold to the
Offering Agent as principal or to an investor
or other purchaser through the Offering Agent
acting as agent for the Operating Partnership;
6. with respect to Notes sold to the Offering
Agent as principal, whether such Notes
will be resold by the Offering Agent to
investors and other purchasers at (i) a fixed
public offering price of a specified percentage
of their principal amount or (ii) at varying
prices related to prevailing market prices at
the time of resale to be determined by the
Offering Agent;
7. with respect to Notes sold to an investor or
other purchaser through the Offering Agent
acting as agent for the Operating Partnership,
whether such Notes will be sold at (i) 100% of
their principal amount or (ii) a specified
percentage of their principal amount;
8. the Offering Agent's discount or commission;
9. Net proceeds to the Operating Partnership;
10. the Principal Amount, Specified Currency,
Original Issue Date, Stated Maturity
Date, Interest Payment Date(s), Authorized
Denomination, Initial Redemption Date, if any,
Initial Redemption Percentage, if any, Annual
Redemption Percentage Reduction, if any,
Optional Repayment Date(s), if any, Exchange
Rate Agent, if any, and, in the case of Fixed
Rate Notes, the Interest Rate, and, in the case
of Floating Rate Notes, the Interest Category,
the Interest Rate Basis or Bases, Day Count
Convention, Index Maturity (if applicable),
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Initial Interest Rate, if any, Maximum Interest
Rate, if any, Minimum Interest Rate, if any,
Initial Interest Reset Date, Interest Reset
Dates, Spread and/or Spread Multiplier, if any,
and Calculation Agent, and, in the case of
Discount Notes, the Issue Price; and
11. any other additional provisions of the Notes
material to investors or other purchasers of
the Notes not otherwise specified in the
Prospectus.
The Operating Partnership shall send such Pricing
Supplement by telecopy or overnight express (for
delivery by the close of business on the applicable
trade date, but in no event later than 11:00 a.m.,
New York City time, on the Business Day following
the applicable trade date) to the Agent which made
or presented the offer to purchase the applicable
Note (in such capacity, the "Offering Agent") and
the Trustee at the following applicable address: if
to Merrill Lynch, Pierce, Fenner & Smith
Incorporated, to: Tritech Services, 40 Colonial
Drive, Piscataway, New Jersey 08854, Attention:
Nachman Kimerling/Final Private Placement Memorandum
Unit, (908) 885-2768, telecopier: (908)
885-2774/5/6, with a copy of such Pricing Supplement
to Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, World Financial Center,
North Tower, 10th Floor, New York, New York,
10281-1310, Attention: MTN Product Management,
(212) 449-7476, telecopier: (212) 449-2234; if to
J.P. Morgan Securities Inc., Medium Term Note Desk -
3rd Floor, 60 Wall Street, New York, New York
10260, (212) 648-0591, telecopier: (212) 648-5907 and
if to the Trustee, to SunTrust Bank, Atlanta, 58
Edgewood Avenue, Suite 400, Atlanta, Georgia 30303,
telecopier: (404) 322-3966 Attention: Bryan Echols.
A copy of such Pricing Supplement shall also be sent
to Hogan & Hartson L.L.P., Columbia Square, 555
Thirteenth Street, N.W., Washington, D.C. 20004,
Attention: J. Warren Gorrell, Jr.
In each instance that a Pricing Supplement is
prepared, the Offering Agent will provide a copy of
such Pricing Supplement to each investor or
purchaser
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of the relevant Notes or its agent. Pursuant to
Rule 434 ("Rule 434") of the Securities Act of 1933,
as amended, the Pricing Supplement may be delivered
separately from the Prospectus. Outdated Pricing
Supplements (other than those retained for files)
will be destroyed.
Settlement: The receipt of immediately available funds by the
Operating Partnership in payment for a Note and
the authentication and delivery of such Note shall,
with respect to such Note, constitute "settlement".
Offers accepted by the Operating Partnership will be
settled in three Business Days, or at such time as
the purchaser, the Offering Agent and the Operating
Partnership shall agree, pursuant to the timetable
for settlement set forth in Parts II and III hereof
under "Settlement Procedure Timetable" with respect
to Global Notes and Certificated Notes, respectively
(each such date fixed for settlement is hereinafter
referred to as a "Settlement Date"). If procedures
A and B of the applicable Settlement Procedures with
respect to a particular offer are not completed on
or before the time set forth under the applicable
"Settlement Procedures Timetable," such offer shall
not be settled until the Business Day following the
completion of settlement procedures A and B or such
later date as the purchaser and the Operating
Partnership shall agree.
The foregoing settlement procedures may be modified
with respect to any purchase of Notes by an Agent as
principal if so agreed by the Operating Partnership
and such Agent.
Procedure for Changing
Rates or Other
Variable Terms: When a decision has been reached to change the
interest rate or any other variable term on any
Notes being sold by the Operating Partnership, the
Operating Partnership will promptly advise the
Agents and the Trustee by telephone and the Agents
will forthwith suspend solicitation of offers to
purchase such Notes. The Agents will telephone the
Operating Partnership with recommendations as to
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the changed interest rates or other variable terms.
At such time as the Operating Partnership notifies
the Agents and the Trustee of the new interest rates
or other variable terms, the Agents may resume
solicitation of offers to purchase such Notes.
Until such time, only "indications of interest" may
be recorded. Immediately after acceptance by the
Operating Partnership of an offer to purchase Notes
at a new interest rate or new variable term, the
Operating Partnership, the Offering Agent and the
Trustee shall follow the procedures set forth under
the applicable "Settlement Procedures."
Suspension of
Solicitation;
Amendment or
Supplement: The Operating Partnership may instruct the Agents
to suspend solicitation of offers to purchase
Notes at any time. Upon receipt of such
instructions, the Agents will forthwith suspend
solicitation of offers to purchase from the
Operating Partnership until such time as the
Operating Partnership has advised the Agents that
solicitation of offers to purchase may be resumed.
Any notice of an amendment or supplement to the
Registration Statement or the Prospectus required to
be given by the Operating Partnership to the Agents
pursuant to the Distribution Agreement shall be
given as so required and any amendment or supplement
to the Registration Statement or the Prospectus
required to be delivered or mailed to the Agents
pursuant to the Distribution Agreement shall be
delivered or mailed as so required in quantities
which such parties may reasonably request at the
following respective addresses: if to Merrill
Lynch, Pierce, Fenner & Smith Incorporated, World
Financial Center, North Tower, 10th Floor, New York,
New York 10281-1310, Attention: MTN Product
Management, (212) 449-7476, telecopier: (212)
449-2234; if to J.P. Morgan Securities Inc., Medium
Term Note Desk - 3rd Floor, 60 Wall Street, New
York, New York 10260, (212) 648-0591, telecopier:
(212) 648-5907 and if to the Trustee, to: SunTrust
Bank, Atlanta, 58 Edgewood Avenue, Suite 400,
Atlanta, Georgia 30303, Attention: Bryan Echols,
telecopier: (404)322-3966. One copy of such
amendment or supplement shall be sent to
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Hogan & Hartson L.L.P., Columbia Square, 555
Thirteenth Street, N.W., Washington, D.C. 20004,
Attention: J. Warren Gorrell, Jr.
In the event that at the time the solicitation of
offers to purchase from the Operating Partnership is
suspended (other than to establish or change
interest rates or formulas, maturities, prices or
other similar variable terms with respect to the
Notes) there shall be any offers to purchase Notes
that have been accepted by the Operating Partnership
which have not been settled, the Operating
Partnership will promptly advise the Offering Agent
and the Trustee whether such offers may be settled
and whether copies of the Prospectus as theretofore
amended and/or supplemented as in effect at the time
of the suspension may be delivered in connection
with the settlement of such offers. The Operating
Partnership will have the sole
responsibility for such decision and for any
arrangements which may be made in the event that the
Operating Partnership determines that such offers
may not be settled or that copies of such Prospectus
may not be so delivered.
Delivery of Prospectus
and applicable
Pricing Supplement: A copy of the most recent Prospectus and the
applicable Pricing Supplement, which pursuant
to Rule 434 may be delivered separately from the
Prospectus, must accompany or precede the earlier of
(a) the written confirmation of a sale sent to an
investor or other purchaser or its agent and (b) the
delivery of Notes to an investor or other purchaser
or its agent.
Authenticity of
Signatures: The Agents will have no obligation or liability to
the Operating Partnership or the Trustee in
respect of the authenticity of the signature of any
officer, employee or agent of the Operating
Partnership or the Trustee on any Note.
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Documents Incorporated
by Reference: The Operating Partnership shall supply the Agents
with an adequate supply of all documents
incorporated by reference in the Registration
Statement and the Prospectus.
PART II: PROCEDURES FOR NOTES ISSUED
IN BOOK-ENTRY FORM
In connection with the qualification of Notes issued in book-entry form
for eligibility in the book-entry system maintained by DTC, the Trustee will
perform the custodial, document control and administrative functions described
below, in accordance with its respective obligations under a Letter of
Representations from the Operating Partnership and The First National Bank of
Chicago, as Paying Agent of the Trustee to DTC, dated January 14, 1997, and a
Certificate Agreement, dated May 26, 1989, between The First National Bank of
Chicago, as Paying Agent of the Trustee and DTC, as amended (the
"Certificate Agreement"), and its obligations as a participant in DTC,
including DTC's Same-Day Funds Settlement System ("SDFS").
Issuance: All Fixed Rate Notes issued in book-entry form
having the same Original Issue Date, Specified
Currency, Interest Rate, Interest Payment Dates,
redemption and/or repayment terms, if any, and
Stated Maturity Date (collectively, the "Fixed Rate
Terms") will be represented initially by one or more
Global Notes; and all Floating Rate Notes issued in
book-entry form having the same Original Issue Date,
Specified Currency, Interest Category, formula for
the calculation of interest (including the Interest
Rate Basis or Bases, which may be the CD Rate, the
CMT Rate, the Commercial Paper Rate, the Eleventh
District Cost of Funds Rate, the Federal Funds Rate,
LIBOR, the Prime Rate or the Treasury Rate or any
other interest rate basis or formula, and Spread
and/or Spread Multiplier, if any), Day Count
Convention, Initial Interest Rate, Index Maturity
(if applicable), Minimum Interest Rate, if any,
Maximum Interest Rate, if any, redemption and/or
repayment terms, if any, Interest Payment Dates,
Initial Interest Reset Date, Interest Reset Dates
and Stated Maturity Date (collectively, the
"Floating Rate Terms") will be represented initially
by one or more Global Notes.
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For other variable terms with respect to the Fixed
Rate Notes and Floating Rate Notes, see the
Prospectus and the applicable Pricing Supplement.
Owners of beneficial interests in Global Notes will
be entitled to physical delivery of Certificated
Notes equal in principal amount to their respective
beneficial interests only upon certain limited
circumstances described in the Prospectus.
Identification: The Operating Partnership has arranged with the
CUSIP Service Bureau of Standard & Poor's
Corporation (the "CUSIP Service Bureau") for the
reservation of one series of CUSIP numbers, which
series consists of approximately 900 CUSIP numbers
which have been reserved for and relate to Global
Notes and the Operating Partnership has delivered to
each of the Trustee and DTC such list of such CUSIP
numbers. The Operating Partnership will assign
CUSIP numbers to Global Notes as described below
under Settlement Procedure B. DTC will notify the
CUSIP Service Bureau periodically of the CUSIP
numbers that the Operating Partnership has assigned
to Global Notes. The Trustee will notify the
Operating Partnership at any time when fewer than
100 of the reserved CUSIP numbers remain unassigned
to Global Notes, and, if it deems necessary, the
Operating Partnership will reserve and obtain
additional CUSIP numbers for assignment to Global
Notes. Upon obtaining such additional CUSIP
numbers, the Operating Partnership will deliver a
list of such additional numbers to the Trustee and
DTC. Notes issued in book-entry form in excess of
$200,000,000 (or the equivalent thereof in one or
more foreign or composite currencies) in aggregate
principal amount and otherwise required to be
represented by the same Global Note will instead by
represented by two or more Global Notes which shall
all be assigned the same CUSIP number.
Registration: Unless otherwise specified by DTC, each Global Note
will be registered in the name of Cede & Co.,
as nominee for DTC, on the register maintained by
the Trustee under the Indenture. The beneficial
owner of
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a Note issued in book-entry form (i.e., an owner of
a beneficial interest in a Global Note) (or one or
more indirect participants in DTC designated by such
owner) will designate one or more participants in
DTC (with respect to such Note issued in book-entry
form, the "Participants") to act as agent for such
beneficial owner in connection with the book-entry
system maintained by DTC, and DTC will record in
book-entry form, in accordance with instructions
provided by such Participants, a credit balance
with respect to such Note issued in book-entry form
in the account of such Participants. The ownership
interest of such beneficial owner in such Note
issued in book-entry form will be recorded through
the records of such Participants or through the
separate records of such Participants and one or
more indirect participants in DTC.
Transfers: Transfers of beneficial ownership interests in a
Global Note will be accomplished by book entries
made by DTC and, in turn, by Participants (and in
certain cases, one or more indirect participants in
DTC) acting on behalf of beneficial transferors and
transferees of such Global Note.
Exchanges: The Trustee may deliver to DTC and the CUSIP
Service Bureau at any time a written notice
specifying (a) the CUSIP numbers of two or more
Global Notes outstanding on such date that represent
Global Notes having the same Fixed Rate Terms or
Floating Rate Terms, as the case may be (other than
Original Issue Dates), and for which interest has
been paid to the same date; (b) a date, occurring at
least 30 days after such written notice is delivered
and at least 30 days before the next Interest
Payment Date for the related Notes issued in
book-entry form, on which such Global Notes shall be
exchanged for a single replacement Global Note; and
(c) a new CUSIP number, obtained from the Operating
Partnership, to be assigned to such replacement
Global Note. Upon receipt of such a notice, DTC
will send to its Participants (including the
Trustee) a written reorganization notice to the
effect that such exchange will occur on such date.
Prior to the specified exchange date, the Trustee
will deliver to
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the CUSIP Service Bureau written notice setting
forth such exchange date and the new CUSIP number
and stating that, as of such exchange date, the
CUSIP numbers of the Global Notes to be exchanged
will no longer be valid. On the specified exchange
date, the Trustee will exchange such Global Notes
for a single Global Note bearing the new CUSIP
number and the CUSIP numbers of the exchanged Notes
will, in accordance with CUSIP Service Bureau
procedures, be canceled and immediately reassigned.
Notwithstanding the foregoing, if the Global Notes
to be exchanged exceed $200,000,000 (or the
equivalent thereof in one or more foreign or
composite currencies ) in aggregate principal
amount, one replacement Note will be authenticated
and issued to represent each $200,000,000 (or the
equivalent thereof in one or more foreign or
composite currencies) in aggregate principal amount
of the exchanged Global Notes and an additional
Global Note or Notes will be authenticated and
issued to represent any remaining principal amount
of such Global Notes (See "Denominations" below).
Denominations: Unless otherwise specified in the applicable Pricing
Supplement, Notes issued in book-entry form
will be issued in denominations of $1,000 and
integral multiples thereof. Each Global Note will
be denominated in an aggregate principal amount not
in excess of $200,000,000 (or the equivalent thereof
in one or more foreign or composite currencies). If
one or more Notes are issued in book-entry form
having an aggregate principal amount in excess of
$200,000,000 (or the equivalent thereof in one or
more foreign or composite currencies) and would, but
for the preceding sentence, be represented by a
single Global Note, then one Global Note will be
issued to represent each $200,000,000 (or the
equivalent thereof in one or more foreign or
composite currencies) in aggregate principal amount
of such Notes issued in book-entry form and an
additional Global Note will be issued to represent
any remaining aggregate principal amount of such
Notes issued in book-entry form. In such a case,
each of the Global Notes representing Notes issued
in book-entry form shall be assigned the same CUSIP
number.
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Payments of Principal
and Interest: Payments of Interest Only. Promptly after each
Regular Record Date, the Trustee will deliver
to the Operating Partnership and DTC a written
notice specifying by CUSIP number the amount of
interest to be paid on each Global Note on the
following Interest Payment Date (other than an
Interest Payment Date coinciding with the Maturity
Date) and the total of such amounts. DTC will
confirm the amount payable on each Global Note on
such Interest Payment Date by reference to the daily
bond reports published by Standard & Poor's
Corporation. On such Interest Payment Date, the
Operating Partnership will pay to the Trustee in
immediately available funds an amount sufficient to
pay the interest then due and owing on the Global
Notes, and upon receipt of such funds from the
Operating Partnership, the Trustee in turn will pay
to DTC such total amount of interest due on such
Global Notes (other than on the Maturity Date) which
is payable in U.S. dollars, at the times and in the
manner set forth below under "Manner of Payment."
The Trustee shall make payment of that amount of
interest due and owing on any Global Notes that
Participants have elected to receive in foreign or
composite currencies directly to such Participants.
Notice of Interest Rates. Promptly after each
Interest Determination Date or Calculation Date, as
the case may be, for Floating Rate Notes issued in
book-entry form, the Trustee will notify each of
Moody's Investors Service, Inc. and Standard &
Poor's Corporation of the interest rates determined
as of such Interest Determination Date.
Payments at Maturity. On or about the first
Business Day of each month, the Trustee will deliver
to the Operating Partnership and DTC a written list
of principal, premium, if any, and interest to be
paid on each Global Note maturing or otherwise
becoming due in the following month. The Trustee,
the Operating Partnership and DTC will confirm the
amounts of such principal, premium, if any, and
interest payments with respect to each such Global
Note on or
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about the fifth Business Day preceding the
Maturity Date of such Global Note. On the Maturity
Date, the Operating Partnership will pay to the
Trustee in immediately available funds an amount
sufficient to make the required payments, and upon
receipt of such funds the Trustee in turn will pay
to DTC the principal amount of Global Notes,
together with premium, if any, and interest due on
the Maturity Date, which are payable in U.S.
dollars, at the times and in the manner set forth
below under "Manner of Payment." The Trustee shall
make payment of the principal, premium, if any, and
interest to be paid on the Maturity Date of each
Global Note that Participants have elected to
receive in foreign or composite currencies directly
to such Participants. Promptly after (i) payment to
DTC of the principal, premium, if any, and interest
due on the Maturity Date of a Global Note payable in
U.S. dollars and (ii) payment of the principal,
premium, if any, and interest due on the Maturity
Date of a Global Note to those Participants who have
elected to receive such payments in foreign or
composite currencies, the Trustee will cancel such
Global Note and deliver it to the Operating
Partnership with an appropriate debit advice. On
the first Business Day of each month, the Trustee
will deliver to the Operating Partnership a written
statement indicating the total principal amount of
outstanding Global Notes as of the close of business
on the immediately preceding Business Day.
Manner of Payment. The total amount of any
principal, premium, if any, and interest due on
Global Notes on any Interest Payment Date or the
Maturity Date, as the case may be, which is payable
in U.S. dollars shall be paid by the Operating
Partnership to the Trustee in funds available for
use by the Trustee no later than 10:00 a.m., New
York City time, on such date. The Operating
Partnership will make such payment on such Global
Notes to an account specified by the Trustee. Upon
receipt of such funds, the Trustee will pay by
separate wire transfer (using Fedwire message entry
instructions in a form previously specified by DTC)
to an account at the Federal Reserve Bank of New
York previously
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specified by DTC, in funds available for immediate
use by DTC, each payment in U.S. dollars of
principal, premium, if any, and interest due on
Global Notes on such date. Thereafter on such date,
DTC will pay, in accordance with its SDFS operating
procedures then in effect, such amounts in funds
available for immediate use to the respective
Participants in whose names the beneficial interests
in such Global Notes are recorded in the book-entry
system maintained by DTC. Neither the Operating
Partnership nor the Trustee shall have any
responsibility or liability for the payment in U.S.
dollars by DTC of the principal of, or premium, if
any, or interest on, the Global Notes. The Trustee
shall make all payments of principal, premium, if
any, and interest on each Global Note that
Participants have elected to receive in foreign or
composite currencies directly to such Participants.
Withholding Taxes. The amount of any taxes required
under applicable law to be withheld from any
interest payment on a Global Note will be determined
and withheld by the Participant, indirect
participant in DTC or other Person responsible for
forwarding payments and materials directly to the
beneficial owner of such Global Note.
Settlement
Procedures: Settlement Procedures with regard to each Note in
book-entry form sold by an Agent, as agent of
the Operating Partnership, or purchased by an Agent,
as principal, will be as follows:
A. The Offering Agent will advise the Operating
Partnership by telephone, confirmed by
facsimile, of the following settlement
information:
1. Principal Amount, Authorized Denomination
and Specified Currency.
2. Exchange Rate Agent, if any.
3. (a) Fixed Rate Notes:
(i) Interest Rate.
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(ii) Interest Payment Dates.
(b) Floating Rate Notes:
(i) Interest Category.
(ii) Interest Rate Basis or Bases.
(iii) Initial Interest Rate.
(iv) Spread and/or Spread Multiplier, if
any.
(v) Initial Interest Reset Date or
Interest Reset Dates.
(vi) Interest Payment Dates.
(vii) Index Maturity, if any.
(viii) Maximum and/or Minimum Interest
Rates, if any.
(ix) Day Count Convention.
(x) Calculation Agent.
(c) Discount Notes:
(i) Issue Price
4. Price to public of such Note or whether
such Note is being offered at varying
prices relating to prevailing market
prices at time of resale as determined by
the Offering Agent.
5. Trade Date.
6. Settlement Date (Original Issue Date).
7. Stated Maturity Date.
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8. Whether the Operating Partnership has the
option to extend the Stated Maturity Date
of the Note, and, if so the final Maturity
Date.
9. Redemption provisions, if any.
10. Repayment provisions, if any.
11. Net proceeds to the Operating Partnership.
12. The Offering Agent's discount or
commission.
13. Whether such Note is being sold to the
Offering Agent as principal or to an
investor or other purchaser through the
Offering Agent acting as agent for the
Operating Partnership.
14. Such other information specified with
respect to such Note (whether by Addendum
or otherwise).
B. The Operating Partnership will assign a CUSIP
number to the Global Note representing such
Note and then advise the Trustee by facsimile
transmission or other electronic transmission of
the above settlement information received from
the Offering Agent, such CUSIP number and the
name of the Offering Agent. The Operating
Partnership will also advise the Offering Agent
of the CUSIP number assigned to the Global Note.
C. The Trustee will communicate to DTC and the
Offering Agent through DTC's Participant
Terminal System a pending deposit message
specifying the following settlement information:
1. The information set forth in the Settlement
Procedure A.
2. Identification numbers of the participant
accounts maintained by DTC on behalf of the
Trustee and the Offering Agent.
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3. Identification of the Global Note as a Fixed
Rate Global Note or Floating Rate Global
Note.
4. Initial Interest Payment Date for such Note,
number of days by which such date succeeds the
related record date for DTC purposes (or, in
the case of Floating Rate Notes which reset
daily or weekly, the date five calendar days
preceding the Interest Payment Date) and, if
then calculable, the amount of interest
payable on such Interest Payment Date (which
amount shall have been confirmed by the
Trustee).
5. CUSIP number of the Global Note representing
such Note.
6. Whether such Global Note represents any
other Notes issued or to be issued in
book-entry form.
DTC will arrange for each pending deposit message
described above to be transmitted to Standard &
Poor's Corporation, which will use the information
in the message to include certain terms of the
related Global Note in the appropriate daily bond
report published by Standard & Poor's Corporation.
D. The Trustee will complete and authenticate the
Global Note representing such Note.
E. DTC will credit such Note to the participant
account of the Trustee maintained by DTC.
F. The Trustee will enter an SDFS deliver order
through DTC's Participant Terminal
System instructing DTC (i) to debit such Note
to the Trustee's participant account and
credit such Note to the participant account of
the Offering Agent maintained by DTC and (ii)
to debit the settlement account of the
Offering Agent and credit the settlement
account of the Trustee maintained by DTC, in
an amount equal to the price of such Note
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less such Offering Agent's discount or
underwriting commission, as applicable. Any
entry of such a deliver order shall be deemed
to constitute a representation and warranty by
the Trustee to DTC that (i) the Global Note
representing such Note has been issued and
authenticated and (ii) the Trustee is holding
such Global Note pursuant to the Certificate
Agreement.
G. In the case of Notes in book-entry form sold
through the Offering Agent, as agent,
the Offering Agent will enter an SDFS deliver
order through DTC's Participant Terminal
System instructing DTC (i) to debit such Note
to the Offering Agent's participant account
and credit such Note to the participant
account of the Participants maintained by DTC
and (ii) to debit the settlement accounts of
such Participants and credit the settlement
account of the Offering Agent maintained by
DTC in an amount equal to the initial public
offering price of such Note.
H. Transfers of funds in accordance with SDFS
deliver orders described in Settlement
Procedures F and G will be settled in
accordance with SDFS operating procedures in
effect on the Settlement Date.
I. Upon receipt, the Trustee will pay the
Operating Partnership, by wire transfer
of immediately available funds to an account
specified by the Operating Partnership to the
Trustee from time to time, the amount
transferred to the Trustee in accordance with
Settlement Procedure F.
J. The Trustee will send a copy of the Global
Note by first class mail to the Operating
Partnership and, at the request of the
Operating Partnership, a statement setting
forth the principal amount of Notes
Outstanding as of the related Settlement Date
after giving effect to such transaction and
all other offers to purchase Notes of which
the Operating Partnership has advised the
Trustee but which have not yet been settled.
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K. If such Note was sold through the Offering
Agent, as agent, the Offering Agent
will confirm the purchase of such Note to the
investor or other purchaser either by
transmitting to the Participant with respect
to such Note a confirmation order through
DTC's Participant Terminal System or by
mailing a written confirmation to such
investor or other purchaser.
Settlement Procedures
Timetable: For offers to purchase Notes accepted by the
Operating Partnership, Settlement Procedures A
through K set forth above shall be completed as soon
as possible following the trade but not later than
the respective times (New York City time) set forth
below:
SETTLEMENT
PROCEDURE TIME
--------- ----
A 11:00 a.m. on the trade date or within one
hour following the trade
B 12:00 noon on the trade date or within one
hour following the trade
C No later than the close of business on the
trade date
D 9:00 a.m. on Settlement Date
E 10:00 a.m. on Settlement Date
F-G No later than 2:00 p.m. on
Settlement Date
H 4:00 p.m. on Settlement Date
I-K 5:00 p.m. on Settlement Date
Settlement Procedure H is subject to extension in
accordance with any extension of Fedwire closing
deadlines and in the other events specified in the
SDFS operating procedures in effect on the
Settlement Date.
If settlement of a Note issued in book-entry
form is rescheduled or canceled, the Trustee will
deliver to DTC, through DTC's Participant Terminal
System, a cancellation message to such effect by no
later than 2:00 p.m., New York City time, on the
Business Day immediately preceding the scheduled
Settlement Date.
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Failure to Settle: If the Trustee fails to enter an SDFS deliver order
with respect to a Note issued in book-entry
form pursuant to Settlement Procedure F, the
Trustee may deliver to DTC, through DTC's
Participant Terminal System, as soon as practicable
a withdrawal message instructing DTC to debit such
Note to the participant account of the Trustee
maintained at DTC. DTC will process the withdrawal
message, provided that such participant account
contains a principal amount of the Global Note
representing such Note that is at least equal to
the principal amount to be debited. If withdrawal
messages are processed with respect to all the
Notes represented by a Global Note, the Trustee
will mark such Global Note "canceled," make
appropriate entries in its records and send
certification of destruction of such canceled
Global Note to the Operating Partnership. The
CUSIP number assigned to such Global Note shall, in
accordance with CUSIP Service Bureau procedures, be
canceled and not immediately reassigned. If
withdrawal messages are processed with respect to a
portion of the Notes represented by a Global Note,
the Trustee will exchange such Global Note for two
Global Notes, one of which shall represent the
Global Notes for which withdrawal messages are
processed and shall be canceled immediately after
issuance and the other of which shall represent the
other Notes previously represented by the
surrendered Global Note and shall bear the CUSIP
number of the surrendered Global Note.
In the case of any Note in book-entry form sold
through the Offering Agent, as agent, if the
purchase price for any such Note is not timely paid
to the Participants with respect thereto by the
beneficial investor or other purchaser thereof (or
a person, including an indirect participant in DTC,
acting on behalf of such investor or other
purchaser), such Participants and, in turn, the
related Offering Agent may enter SDFS deliver
orders through DTC's Participant Terminal System
reversing the orders entered pursuant to Settlement
Procedures F and G, respectively. Thereafter, the
Trustee will deliver the
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withdrawal message and take the related actions
described in the preceding paragraph. If such
failure shall have occurred for any reason other
than default by the Offering Agent to perform its
obligations hereunder or under the Distribution
Agreement, the Operating Partnership will reimburse
such Offering Agent on an equitable basis for its
loss of the use of funds during the period when the
funds were credited to the account of the Operating
Partnership.
Notwithstanding the foregoing, upon any failure
to settle with respect to a Note in book-entry
form, DTC may take any actions in accordance with
its SDFS operating procedures then in effect. In
the event of a failure to settle with respect to a
Note that was to have been represented by a Global
Note also representing other Notes, the Trustee
will provide, in accordance with Settlement
Procedure D, for the authentication and issuance of
a Global Note representing such remaining Notes and
will make appropriate entries in its records.
PART III: PROCEDURES FOR CERTIFICATED NOTES
Denominations: Unless otherwise specified in the applicable
Pricing Supplement, the Certificated Notes will be
issued in denominations of $1,000 and integral
multiples thereof.
Payments of Principal,
Premium, if any,
and Interest: Upon presentment and delivery of the Certificated
Note, the Trustee upon receipt of immediately
available funds from the Operating Partnership will
pay the principal of, and premium, if any, and
interest on, each Certificated Note on the Maturity
Date in immediately available funds. All interest
payments on a Certificated Note, other than
interest due on the Maturity Date, will be made by
check mailed to the address of the person entitled
thereto as such address
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shall appear in the Security Register; provided,
however, that Holders of $10,000,000 (or, if
the applicable Specified Currency is other than
United States dollars, the equivalent thereof in
such Specified Currency) or more in aggregate
principal amount of Certificated Notes (whether
having identical or different terms and provisions)
shall be entitled to receive such interest payments
by wire transfer of immediately available funds if
appropriate wire transfer instructions have been
received in writing by the Trustee not less than 15
calendar days prior to the applicable Interest
Payment Date.
The Trustee will provide monthly to the Operating
Partnership a list of the principal, premium, if
any, and interest to be paid on Certificated Notes
maturing in the next succeeding month. The Trustee
will be responsible for withholding taxes on
interest paid as required by applicable law.
Certificated Notes presented to the Trustee on
the Maturity Date for payment will be canceled by
the Trustee. All canceled Certificated Notes held
by the Trustee shall be destroyed, and the Trustee
shall furnish to the Operating Partnership a
certificate with respect to such destruction.
Settlement
Procedures: Settlement Procedures with regard to each
Certificated Note purchased by an Agent, as
principal, or through an Agent, as agent, shall be
as follows:
A. The Offering Agent will advise the Operating
Partnership by telephone of the following
Settlementinformation with regard to each
Certificated Note:
1. Exact name in which the Certificated
Note(s) is to be registered (the
"Registered Owner").
2. Exact address or addresses of the
Registered Owner for delivery, notices and
payments of principal, premium, if any, and
interest.
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3. Taxpayer identification number of the
Registered Owner.
4. Principal Amount, Authorized
Denomination and Specified Currency.
5. Exchange Rate Agent, if any.
6. (a) Fixed Rate Notes:
(i) Interest Rate.
(ii) Interest Payment Dates.
(iii) Whether such Note is being issued with
Original Issue Discount and, if so,
the terms thereof.
(b) Floating Rate Notes:
(i) Interest Category.
(ii) Interest Rate Basis or Bases.
(iii) Initial Interest Rate.
(iv) Spread and/or Spread
Multiplier, if any.
(v) Initial Interest Reset Date and
Interest Reset Dates.
(vi) Interest Payment Dates.
(vii) Index Maturity, if any.
(viii) Maximum and/or Minimum
Interest Rates, if any.
(ix) Day Count Convention.
(x) Calculation Agent.
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7. Price to public of such Note or whether
such Note is being offered at varying
prices relating to prevailing market
prices at time of resale as determined by
the Offering Agent.
8. Trade Date.
9. Settlement Date (Original Issue Date).
10. Stated Maturity Date.
11. Whether the Operating Partnership has
the option to extend the Stated Maturity
Date of the Note, and, if so the final
Maturity Date.
12. Redemption provisions, if any.
13. Repayment provisions, if any.
14. Net proceeds to the Operating Partnership.
15. The Offering Agent's discount or
commission.
16. Whether such Note is being sold to the
Offering Agent as principal or to an
investor or other purchaser through the
Offering Agent acting as agent for the
Operating Partnership.
17. Such other information specified with
respect to such Note (whether by Addendum
or otherwise).
B. After receiving such settlement information
from the Offering Agent, the Operating
Partnership will advise the Trustee of the above
settlement information by facsimile transmission
confirmed by telephone. The Operating
Partnership will cause the Trustee to issue,
authenticate and deliver the Certificated Note.
C. The Trustee will complete the Certificated Note
in the form approved by the Operating
Partnership and the Offering Agent, and will
make three copies
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thereof (herein called "Stub 1", "Stub 2" and
"Stub 3"):
1. Certificated Note with the Offering
Agent's confirmation, if traded on a
principal basis, or the Offering Agent's
customer confirmation, if traded on an
agency basis.
2. Stub 1 for Trustee.
3. Stub 2 for Offering Agent.
4. Stub 3 for the Operating Partnership.
D. With respect to each trade, the Trustee will
deliver the Certificated Note and Stub 2
thereof to the Offering Agent at the following
applicable address: if to Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Merrill Lynch Money
Markets Clearance, 55 Water Street, Concourse
Level, N.S.C.C. Window, New York, New York
10041, Attention: Al Mitchell, (212) 558-2405,
telecopier: (212) 558-2457; and if to J.P.
Morgan Securities Inc., NSCC-NY Window, 55 Water
Street - Concourse Level, New York, New York
10041 Attn: Bill Davis. The Trustee will keep
Stub 1. The Offering Agent will acknowledge
receipt of the Certificated Note through a
broker's receipt and will keep Stub 2. Delivery
of the Certificated Note will be made only
against such acknowledgment of receipt. Upon
determination that the Certificated Note has
been authorized, delivered and completed as
aforementioned, the Offering Agent will wire the
net proceeds of the Certificated Note after
deduction of its applicable commission to the
Operating Partnership pursuant to standard wire
instructions given by the Operating Partnership.
E. In the case of a Certificated Note sold through
the Offering Agent, as agent, the Offering
Agent will deliver such Certificated Note (with
the confirmation) to the purchaser against
payment in immediately available funds.
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F. The Trustee will send Stub 3 to the Operating
Partnership.
Settlement
Procedures
Timetable: For offers to purchase Certificated Notes accepted
by the Operating Partnership, Settlement
Procedures A through F set forth above shall be
completed as soon as possible following the trade
but not later than the respective times (New York
City time) set forth below:
SETTLEMENT
PROCEDURE TIME
--------- ----
A 11:00 a.m. on the trade date or within one
hour following the trade
B 12:00 noon on the trade date or within one
hour following the trade
C-D 2:15 p.m. on Settlement Date
E 3:00 p.m. on Settlement Date
F 5:00 p.m. on Settlement Date
Failure to Settle: In the case of Certificated Notes sold through the
Offering Agent, as agent, if an investor or
other purchaser of a Certificated Note from the
Operating Partnership shall either fail to accept
delivery of or fail to make payment for such
Certificated Note on the date fixed for settlement,
the Offering Agent will forthwith notify the Trustee
and the Operating Partnership by telephone,
confirmed in writing, and return such Certificated
Note to the Trustee.
The Trustee, upon receipt of such Certificated Note
from the Offering Agent, will immediately advise the
Operating Partnership and the Operating Partnership
will promptly arrange to credit the account of the
Offering Agent in an amount of immediately available
funds equal to the amount previously paid to the
Operating Partnership by such Offering Agent in
settlement for such Certificated Note. Such credits
will be made on the Settlement Date if possible, and
in any event not later than the Business Day
following the Settlement Date; provided that the
Operating Partnership has received notice on the
same day. If
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such failure shall have occurred for any reason
other than default by the Offering Agent to perform
its obligations hereunder or under the Distribution
Agreement, the Operating Partnership will reimburse
such Offering Agent on an equitable basis for its
loss of the use of funds during the period when the
funds were credited to the account of the Operating
Partnership. Immediately upon receipt of the
Certificated Note in respect of which the failure
occurred, the Trustee will cancel and destroy such
Certificated Note, make appropriate entries in its
records to reflect the fact that such Certificated
Note was never issued, and accordingly notify in
writing the Operating Partnership.
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