Exhibit 2.1
================================================================================
AGREEMENT AND PLAN OF MERGER
Among
EAGLE HOSPITALITY PROPERTIES TRUST, INC.,
EHP OPERATING PARTNERSHIP, L.P.,
AP AIMCAP HOLDINGS LLC
and
AP AIMCAP
CORPORATION
Dated as of April 27, 2007
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
<C>
ARTICLE I
DEFINITIONS.............................................................................................2
Section 1.01
Definitions...................................................................2
Section 1.02
Interpretation and Rules of
Construction.....................................10
ARTICLE II THE
MERGER............................................................................................11
Section 2.01
General......................................................................11
Section 2.02
Charter and
Bylaws...........................................................11
Section 2.03
Effective
Time...............................................................11
Section 2.04
Closing......................................................................11
Section 2.05
Directors and Officers of the Surviving Entity; General
Partner..............11
ARTICLE III EFFECTS OF THE
MERGER................................................................................12
Section 3.01
Effects on
Shares............................................................12
Section 3.02
Effect on Units of Partnership Interest of the Operating
Partnership.........13
Section 3.03
Paying
Agent.................................................................14
Section 3.04
Withholding
Rights...........................................................17
Section 3.05
Further
Actions..............................................................17
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE
OPERATING PARTNERSHIP...........................17
Section 4.01
Organization and Qualification; Subsidiaries;
Authority......................17
Section 4.02
Organizational
Documents.....................................................18
Section 4.03
Capitalization...............................................................18
Section 4.04
Authority Relative to this Agreement; Validity and Effect of
Agreements...................................................................20
Section 4.05
No Conflict; Required Filings and
Consents...................................20
Section 4.06
Permits; Compliance with
Laws................................................21
Section 4.07
SEC Filings; Financial
Statements............................................22
Section 4.08
No Unknown
Liabilities.......................................................23
Section 4.09
Absence of Certain Changes or
Events.........................................23
Section 4.10
Absence of
Litigation........................................................23
Section 4.11
Employee Benefit
Plans.......................................................24
Section 4.12
Labor
Matters................................................................25
Section 4.13
Information
Supplied.........................................................26
Section 4.14
Property and
Leases..........................................................26
Section 4.15
Personal
Property............................................................28
Section 4.16
Intellectual
Property........................................................28
Section 4.17
Taxes........................................................................28
Section 4.18
Environmental
Matters........................................................31
I
<PAGE>
Section 4.19
Material
Contracts...........................................................31
Section 4.20
Brokers......................................................................33
Section 4.21
Opinion of Financial
Advisor.................................................33
Section 4.22
Insurance....................................................................33
Section 4.23
Special Committee Recommendation; Company Board
Recommendation...............34
Section 4.24
Related Party
Transactions...................................................34
Section 4.25
State Takeover
Statutes......................................................34
Section 4.26
Outstanding
Indebtedness.....................................................34
ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER
SUB................................................34
Section 5.01
Corporate
Organization.......................................................35
Section 5.02
Ownership of Merger Sub; No Prior
Activities.................................35
Section 5.03
Power and
Authority..........................................................35
Section 5.04
No Conflict; Required Filings and
Consents...................................36
Section 5.05
Information
Supplied.........................................................37
Section 5.06
Absence of
Litigation........................................................37
Section 5.07
Financing....................................................................37
Section 5.08
Solvency; Surviving Corporation After the
Merger.............................37
Section 5.09
Guaranty.....................................................................38
Section 5.10
No Ownership of Equity
Interest..............................................38
Section 5.11
Other Agreements or
Understandings...........................................38
Section 5.12
Brokers......................................................................38
Section 5.13
No Other Representations and
Warranties......................................38
ARTICLE VI CONDUCT OF BUSINESS PENDING THE
MERGER................................................................39
Section 6.01
Conduct of Business by the Company Pending the
Merger........................39
Section 6.02
Conduct of Business by Parent Pending the
Merger.............................43
ARTICLE VII ADDITIONAL
AGREEMENTS................................................................................44
Section 7.01
Proxy Statement; Other
Filings...............................................44
Section 7.02
Company Stockholders'
Meeting................................................44
Section 7.03
Access to Information;
Confidentiality.......................................45
Section 7.04
No Solicitation of
Transactions..............................................46
Section 7.05
Employee Benefits
Matters....................................................48
Section 7.06
Directors' and Officers' Indemnification and
Insurance.......................49
Section 7.07
Further Action; Reasonable Best
Efforts......................................52
Section 7.08
Transfer
Taxes...............................................................53
Section 7.09
Public
Announcements.........................................................53
Section 7.10
Financing....................................................................53
Section 7.11
Stockholder and Limited Partner
Litigation...................................54
Section 7.12
Fees and
Expenses............................................................55
Section 7.13
State Takeover
Laws..........................................................55
Section 7.14
Notification of Certain
Matters..............................................55
Section 7.15
Resignations.................................................................55
Section 7.16
Puerto Rico
Casino...........................................................55
II
<PAGE>
ARTICLE VIII CONDITIONS TO THE
MERGER............................................................................56
Section 8.01
Conditions to the Obligations of Each
Party..................................56
Section 8.02
Conditions to the Obligations of Parent and Merger
Sub.......................56
Section 8.03
Conditions to the Obligations of the
Company.................................57
ARTICLE IX TERMINATION AND
WAIVER................................................................................57
Section 9.01
Termination..................................................................57
Section 9.02
Effect of
Termination........................................................59
Section 9.03
Fees and
Expenses............................................................59
Section 9.04
Waiver.......................................................................62
Section 9.05
Payment by
Parent............................................................62
ARTICLE X GENERAL
PROVISIONS.....................................................................................63
Section 10.01
Non-Survival of Representations and
Warranties...............................63
Section 10.02
Non-Survival of Certain
Covenants............................................63
Section 10.03
Notices......................................................................63
Section 10.04
Severability.................................................................66
Section 10.05
Amendment....................................................................66
Section 10.06
Entire Agreement;
Assignment.................................................66
Section 10.07
Enforcement of
Agreement.....................................................67
Section 10.08
Parties in
Interest..........................................................68
Section 10.09
Governing Law;
Forum.........................................................68
Section 10.10
Headings.....................................................................68
Section 10.11
Counterparts.................................................................68
Section 10.12
WAIVER OF JURY
TRIAL.........................................................68
Exhibit A
Form of Merger Sub Charter
Exhibit B
Articles Supplementary
Establishing
and Fixing the Rights
and Preferences
of 8.25% Series A
Cumulative Redeemable Preferred Shares of the Surviving Entity
</TABLE>
iii
<PAGE>
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER, dated as of April 27, 2007
(this
"Agreement"), is made and entered into by and among Eagle
Hospitality
Properties Trust, Inc., a Maryland corporation (the "Company"), EHP
Operating
Partnership, L.P., a Maryland limited partnership (the "Operating
Partnership"
and, together with the Company, the "Company Parties"), AP AIMCAP
Holdings
LLC, a Maryland limited liability company ("Parent"), and AP
AIMCAP
Corporation, a Maryland corporation and a wholly owned subsidiary
of Parent
("Merger Sub" and, together with Parent, the "Parent Parties").
WHEREAS, the parties wish to effect a business combination through
a
merger of the Company with and into Merger Sub (the "Merger") on
the terms and
subject to the conditions set forth in this Agreement and in
accordance with
the Maryland General Corporation Law (the "MGCL");
WHEREAS, the Special Committee of independent directors of the
Company (the "Special Committee") has (a) determined that this
Agreement, the
Merger and the other transactions contemplated by this Agreement
(the
"Contemplated Transactions") are advisable and in the best
interests of the
Company and its stockholders and (b) recommended the approval of
this
Agreement, the Merger and the Contemplated Transactions by the
board of
directors of the Company (the "Company Board");
WHEREAS, the Company Board, based on the unanimous recommendation
of
the Special Committee, has (a) determined that this Agreement, the
Merger and
the Contemplated Transactions are advisable and in the best
interests of the
Company and its stockholders, (b) approved this Agreement, the
Merger and the
Contemplated Transactions, (c) directed that this Agreement, the
Merger and
the Contemplated Transactions be submitted for consideration at the
Company
Stockholders' Meeting and (d) recommended the approval of this
Agreement, the
Merger and the Contemplated Transactions by the Company's
stockholders;
WHEREAS, the Company, as the sole general partner of the
Operating
Partnership, has approved this Agreement and deemed it advisable
and in the
best interests of the Operating Partnership to enter into this
Agreement and
to consummate the Merger and the Contemplated Transactions;
WHEREAS, the board of directors of Merger Sub has approved this
Agreement, the Merger and the Contemplated Transactions and
declared that this
Agreement, the Merger and the Contemplated Transactions are
advisable and in
the best interests of Merger Sub and its stockholders;
WHEREAS, Parent, as the sole stockholder of Merger Sub, has
approved
the Merger;
WHEREAS, pursuant to the terms of the Operating Partnership
Agreement, upon the terms and subject to the conditions set forth
in this
Agreement, each Existing Unit Holder will have the opportunity to
elect to
receive, for each Existing Unit, the Electing Unit Consideration,
as described
in Section 3.02;
1
<PAGE>
WHEREAS, concurrently with the execution of this Agreement,
Parent
has delivered to the Company a full and unconditional guaranty
(the
"Guaranty") of the obligations arising under this Agreement of the
Parent
Parties executed by Apollo Real Estate Investment Fund V, L.P.
(the
"Guarantor");
WHEREAS, upon the terms and subject to the conditions set forth
herein, at the Closing, Merger Sub and the Company shall execute
Articles of
Merger (the "Articles of Merger") and shall file such Articles of
Merger in
accordance with the MGCL to effectuate the Merger;
WHEREAS, the parties hereto intend that for U.S. federal and
state
income Tax purposes, the Merger will be treated as a taxable sale
by the
Company of all of the Company's assets to Parent in exchange for
the Common
Share Cash Merger Consideration and Preferred Shares Merger
Consideration and
the assumption of the Company Liabilities, followed by
liquidating
distributions of (i) Common Share Cash Merger Consideration and
accrued
dividend on Common Shares to the holders of Company Common Shares
and (ii)
Preferred Shares Merger Consideration to the holders of Company
Series A
Preferred Shares pursuant to Sections 331 and 562 of the Code;
and
WHEREAS, the parties hereto desire to make certain
representations,
warranties, covenants and agreements in connection with the Merger,
and also
to prescribe various conditions to such transactions.
NOW, THEREFORE, in consideration of the foregoing and the
mutual
covenants and agreements herein contained, and intending to be
legally bound
hereby, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 .Definitions.
(a) For purposes of this Agreement:
"Acquisition Proposal" means any proposal, offer, inquiry or
indication of interest from or by any Person other than Parent and
Merger Sub
contemplating or otherwise relating to or involving (i) any direct
or indirect
(A) sale, lease, exchange, transfer, acquisition or disposition of
more than
20% of the assets of the Company and its Subsidiaries, taken as a
whole, (B)
acquisition or purchase of more than 20% of the shares of capital
stock,
partnership interests or other equity securities of the Company and
its
Subsidiaries, taken as a whole or (C) acquisition or disposition of
a business
or businesses that constitute 20% or more of the cash flow, net
revenues, net
income or assets of the Company and its Subsidiaries, taken as a
whole; (ii)
any tender offer or exchange offer, as defined pursuant to the
Exchange Act,
that, if consummated, would result in any Person beneficially
owning 20% or
more of the outstanding equity securities of the Company; (iii) any
merger,
consolidation, business combination, recapitalization,
liquidation,
dissolution or similar transaction involving the Company, other
than the
Merger, pursuant to which the stockholders of the Company prior
to
consummation of such transaction would hold less than 80% of the
outstanding
shares or equity interests of the surviving or
2
<PAGE>
resulting Person or parent thereof; (iv) any similar transaction or
business
combination involving the Company or any of its businesses, shares
of stock,
partnership interests, other equity interests or assets; or (v)
any
combination of any of the foregoing.
"Action" means any claim, action, suit, proceeding,
arbitration,
mediation, inquiry or other investigation.
"Affiliate" or "affiliate" of a specified Person means a Person
who,
directly or indirectly through one or more intermediaries,
controls, is
controlled by, or is under common control with, such specified
Person.
"Business Day" means any day on which the principal offices of
the
SEC in Washington, D.C. are open to accept filings, or, in the case
of
determining a date when any payment is due, any day (other than a
Saturday or
Sunday) on which banks are not required or authorized to close in
The City of
New York.
"Certificate" means any certificate representing Company Common
Shares.
"Company Bylaws" means the Bylaws of the Company as in effect on
the
date hereof.
"Company Charter" means the Articles of Amendment and Restatement
of
the Company as amended and supplemented and in effect on the date
hereof,
including, as in effect on the date hereof, the Articles
Supplementary of the
8.25% Series A Cumulative Redeemable Preferred Shares.
"Company Common Shares" means shares of common stock, par value
$0.01
per share, of the Company.
"Company Material Adverse Effect": An event, change, effect,
circumstance or development will be deemed to have a "Company
Material Adverse
Effect" if such event, change, effect, circumstance, development or
other
matter (a) has had, or would reasonably be expected to have, a
material
adverse effect, individually or in the aggregate, on the business,
condition
(financial or otherwise), capitalization, assets, liabilities,
operations or
financial performance of the Company and its Subsidiaries, taken as
a whole,
excluding any effects arising out of or resulting from (i) any
change in the
market price or trading volume of the Company Common Shares or the
Company
Series A Preferred Shares, (ii) the announcement of the execution
of this
Agreement or the performance of obligations under this Agreement or
(iii) any
adverse change following the date of this Agreement in the
securities,
financial, credit or real estate markets, or other change following
the date
of this Agreement in general economic or business conditions, or an
outbreak
or escalation of hostilities, a national emergency or war, or the
occurrence
of any act of terrorism, or other changes (including changes in Law
and GAAP)
in the conditions in the hotel, lodging and hospitality industry,
or
earthquakes, hurricanes or other natural disasters or acts of God,
in each
case in this part (iii), except if the Company and its
Subsidiaries, taken as
a whole, are materially and disproportionately affected thereby,
(b) has had,
or would reasonably be expected to have, a material adverse effect
on the
ability of the Company Parties to timely consummate the
Contemplated
Transactions or to timely perform any of their respective
obligations under
this Agreement, or (c) has prevented or materially delayed, or
would
3
<PAGE>
reasonably be expected to prevent or materially delay, the
consummation of the
Contemplated Transactions.
"Company Termination Fee" shall be an amount equal to
$12,750,000.
"Company Triggering Event" means (i) a Recommendation
Withdrawal;
(ii) the failure of the Company to include in the Proxy Statement
the Company
Board Recommendation or a statement to the effect that the Company
Board and
the Special Committee has determined and believes that this
Agreement, the
Merger and the Contemplated Transactions are in the best interests
of the
Company's stockholders; (iii) the approval, endorsement or
recommendation of
the Company Board and the Special Committee of, or the public
announcement of
its intent to approve, endorse or recommend, any Acquisition
Proposal; (iv)
the entry into a Contract (other than a confidentiality agreement
entered into
in compliance with Section 7.04(a)) by any of the Company Parties
relating to
an Acquisition Proposal, or the public announcement of its intent
to do so;
(v) the failure of the Company to comply with Section 7.04(a); or
(vi) a
tender or exchange offer relating to securities of any of the
Company Parties
shall have been commenced by someone other than Parent or its
Affiliates and
the Company shall not have sent to its security holders, within ten
(10)
business days after the commencement of such tender or exchange
offer, a
statement disclosing that the Company Board recommends rejection of
such
tender or exchange offer.
"Contract" means any written or oral agreement, contract,
subcontract, lease, understanding, arrangement, instrument, note,
option,
warranty, purchase order, license, sublicense, insurance policy or
legally
binding commitment or undertaking of any nature other than the
Plans,
including, in each case, any amendments, supplements or
modifications thereto.
"control" (including the terms "controlled by" and "under
common
control with") means the possession, directly or indirectly of the
power to
direct or cause the direction of the management and policies of a
Person,
whether through the ownership of voting securities, as trustee or
executor, by
contract or credit arrangement or otherwise.
"Disclosure Schedule" means the disclosure schedule delivered by
the
Company to Parent concurrently with the execution of this
Agreement, which
disclosure schedule is arranged in paragraphs corresponding to the
sections
contained in Article IV of this Agreement, provided, however, that
the
disclosure of any fact or item in any section of such disclosure
schedule
shall, should the existence of such fact or item be relevant to any
other
section, be deemed to be disclosed with respect to that other
section so long
as the relevance of such disclosure to such other section is
reasonably
apparent from the nature of such disclosure. Nothing in the
Disclosure
Schedule is intended to broaden the scope of any representation or
warranty of
the Company made herein.
"Environmental Laws" means all applicable Legal Requirements
relating
to pollution or protection of human health (as such matters relate
to
Hazardous Substances) or the environment, including ambient air,
surface
water, ground water, land surface or subsurface strata, including
laws and
regulations relating to emissions, discharges, releases or
threatened releases
of Hazardous Substances, or otherwise relating to the manufacture,
processing,
distribution, use, treatment, storage, disposal, transport or
handling of
Hazardous Substances.
4
<PAGE>
"Governmental Authority" means any United States, foreign,
territorial, provincial, state, commonwealth, municipal, tribal or
local
government, governmental, regulatory or administrative authority,
agency,
instrumentality or commission or any court, tribunal, or judicial
or arbitral
body.
"Hazardous Substances" means (i) those substances defined in or
regulated under the following United States federal statutes and
their state
counterparts, as each has been amended from time to time, and all
regulations
thereunder in effect prior to the date hereof: the Resource
Conservation and
Recovery Act, CERCLA, the Clean Water Act, the Safe Drinking Water
Act, the
Atomic Energy Act, and the Clean Air Act; (ii) petroleum and
petroleum
products, including crude oil and any fractions thereof; (iii)
polychlorinated
biphenyls, asbestos, and radon; and (iv) chemicals, pollutants,
contaminants,
wastes, toxic substances, hazardous substances and radioactive
materials
regulated by any Governmental Authority.
"Intellectual Property" means United States and international
(i)
patents, patent applications and invention registrations of any
type, (ii)
trademarks, service marks, trade dress, logos, trade names,
corporate names
and other source identifiers, and registrations and applications
for
registration thereof, (iii) copyrightable works, copyrights, and
registrations
and applications for registration thereof, and (iv) confidential
and
proprietary information, including trade secrets and know-how.
"Knowledge of the Company" means the actual knowledge of J.
William
Blackham and Raymond D. Martz after such inquiry as is reasonable
under the
circumstances.
"Law" means any United States, foreign, territorial,
commonwealth,
state, provincial, municipal or local statute, law, ordinance,
regulation,
rule, code, executive order, injunction, judgment, decree or other
order.
"Legal Requirement" means any federal, state, local, municipal,
foreign or other law, statute, constitution, principle of common
law,
resolution, ordinance, code, edict, decree, executive order, rule,
regulation,
ruling or requirement issued, enacted, adopted, promulgated,
applied,
implemented or otherwise put into effect by or under the authority
of any
Governmental Body (or under the authority of NYSE or any other
stock exchange,
if applicable).
"Liens" means, with respect to any asset (including any
security),
any mortgage, claim, lien, pledge, charge, security interest or
encumbrance of
any kind (other than licenses of Intellectual Property or similar
agreements
relating to Intellectual Property which are not intended to secure
an
obligation) in respect to such asset.
"Nomination Rights Agreement" means that certain Nomination
Rights
Agreement, dated as of October 6, 2004, by and among the Company
and Corporex
Companies, LLC.
"Operating Partnership Agreement" means that certain Agreement
of
Limited Partnership of the Operating Partnership, dated as of
October 6, 2004,
by and among the Company and the limited partners listed on Exhibit
A thereto,
and that certain Amendment to Agreement of Limited Partnership of
the
Operating Partnership, dated as of June 13, 2005.
5
<PAGE>
"Ownership Limitation" has the meaning set forth in the Company
Charter, as amended from time to time, as in effect on the date
hereof.
"Parent Material Adverse Effect" means any event, circumstance,
change or effect that would be expected to prevent, hinder or
materially delay
Parent or Merger Sub from consummating the Merger or the
Contemplated
Transactions or otherwise prevent it from performing its
obligations under
this Agreement.
"Permitted Liens" means (i) Liens for Taxes not yet delinquent
and
Liens for Taxes being contested in good faith by appropriate
proceedings in
respect thereof during which collection or enforcement is stayed
and for which
there are adequate reserves on the financial statements of the
Company (if
such reserves are required pursuant to GAAP); (ii) inchoate
mechanics' and
materialmen's Liens for construction in progress; (iii) inchoate
workmen's,
repairmen's, warehousemen's and carriers' Liens arising in the
ordinary course
of business of the Company or any Subsidiary of the Company; (iv)
zoning
restrictions, survey exceptions, utility easements, rights of way
and similar
Liens that are imposed by any Governmental Authority having
jurisdiction with
respect thereto or otherwise are typical for the applicable
property type and
locality and that, individually or in the aggregate, do not
interfere
materially, or would not reasonably be expected to interfere
materially, with
the current use and operation of such property (assuming its
continued use in
the manner in which it is currently used); (v) with respect to real
property,
Liens and obligations arising under the Material Contracts
(including but not
limited to any Lien securing mortgage debt disclosed in the
Disclosure
Schedule), the Company Leases and any other Lien that does not
interfere
materially with the current use of such property (assuming its
continued use
in the manner in which it is currently used) or materially
adversely affect
the value or marketability of such property; (vi) matters that
would be
disclosed on current title reports or surveys that arise or have
arisen in the
ordinary course of business and that, individually or in the
aggregate, do not
interfere materially, or would not reasonably be expected to
interfere
materially, with the current use and operation of such property
(assuming its
continued use in the manner in which it is currently used); and/or
(vii) other
Liens being contested in good faith in the ordinary course of
business and for
which there are adequate reserves on the financial statements of
the Company.
"Person" means an individual, corporation, partnership, limited
partnership, limited liability company, syndicate, person
(including a
"person" as defined in Section 13(d)(3) of the Exchange Act),
trust,
association, entity or government, or political subdivision, agency
or
instrumentality of a government.
"Representatives" means, with respect to any Person, the equity
holders, partners, employees, consultants, officers, directors,
agents,
attorneys accountants, advisors, debt and equity financing sources
and
representatives of such Person.
"Reverse Termination Fee" shall be an amount equal to
$12,750,000.
"Scheduled Indebtedness" means (without duplication), at any time
and
with respect to the Company, (a) indebtedness of the Company for
borrowed
money (whether by loan or the issuance and sale of debt securities)
or for the
deferred purchase price of property or services purchased (other
than amounts
constituting trade payables, accruals or bank drafts arising in
the
6
<PAGE>
ordinary course of business); (b) indebtedness of others in the
amount which
the Company has directly or indirectly assumed or guaranteed or
otherwise
provided credit support therefor or for which the Company is liable
as a
partner of such other party; (c) indebtedness of others in the
amount secured
by a Lien on assets of the Company, whether or not the Company
shall have
assumed such indebtedness; and (d) obligations of the Company in
respect of
letters of credit, acceptance facilities, or drafts or similar
instruments
issued or accepted by banks and other financial institutions for
the account
of the Company (other than trade payables or bank drafts arising in
the
ordinary course).
"Subsidiary" of the Company, Parent or any other Person means a
corporation, limited liability company, partnership, joint venture
or other
organization of which: (a) such party or any other subsidiary of
such party is
a general partner; (b) voting power to elect a majority of the
board of
directors or others performing similar functions with respect to
such
organization is held by such party or by any one or more of such
party's
subsidiaries; or (c) at least 50% of the equity interests is
controlled by
such party.
"Superior Proposal" means any Acquisition Proposal (except that
references to 20% within the definition of "Acquisition Proposal"
shall be
replaced by "50%") made by a third party on terms that the Company
Board
(acting through the Special Committee) determines, in its good
faith judgment,
after consulting with its or the Special Committee's, as
applicable, financial
advisors and outside legal counsel, taking into account, among
other things,
all of the terms, conditions and circumstances of the Acquisition
Proposal, to
be more favorable to the Company's stockholders from a financial
point of view
than the terms of the Merger and the Contemplated Transactions
(after giving
effect to any modification to this Agreement proposed by the Parent
Parties)
and to be reasonably capable of being consummated.
"Superior Proposal Notice" means at least three (3) Business
Days
written notice from the Company to Parent that the Company or its
Special
Committee is in receipt of an unsolicited Superior Proposal and is
prepared to
approve, authorize or recommend such Superior Proposal or the
applicable
amendment to a Superior Proposal, specifying the material terms and
conditions
of such Superior Proposal or amendment thereto (and a copy thereof,
if
available) and identifying the third party making such Superior
Proposal or
amendment thereto.
"Taxes" means any and all taxes, charges, fees, levies and
other
assessments, including income, gross receipts, excise, property,
sales,
withholding, social security, occupation, use, service, license,
payroll,
franchise, transfer and recording taxes, fees and charges,
including estimated
taxes, imposed by the United States or any taxing authority
(domestic or
foreign), whether computed on a separate, consolidated, unitary,
combined or
any other basis, and similar charges in the nature of a tax
(together with any
and all interest, penalties, additions to tax and additional
amounts imposed
with respect thereto) imposed by any government or taxing
authority.
(b) the following terms have the meaning set forth in the sections
set forth
below:
Location
Defined Terms
of Definition
---------------------------------------------------------
------------------
7
<PAGE>
2006 Balance Sheet.....................................
Section 4.08
2007 Budget............................................
Section 6.01(k)
Acquisition Agreement..................................
Section 7.04(c)
Additional Company Common Share Merger Consideration...
Section 3.01(c)
Agreement..............................................
Preamble
Articles of Merger.....................................
Recitals
Blue Sky Laws..........................................
Section 4.05(b)
Capital Expenditures...................................
Section 6.01(k)
CERCLA.................................................
Section 4.18(c)
Claim..................................................
Section 7.06(a)
Closing................................................
Section 2.04
Closing Date...........................................
Section 2.04
Code...................................................
Section 4.11(b)
Commitment Letters.....................................
Section 5.07
Commitments............................................
Section 5.07
Company................................................
Preamble
Company Board..........................................
Recitals
Company Board Recommendation...........................
Section 4.23
Company Common Share Cash Merger Consideration.........
Section 3.01(c)
Company Common Share Merger Consideration..............
Section 3.01(c)
Company Employees......................................
Section 7.05(b)
Company Expenses.......................................
Section 9.03(e)
Company Intellectual Property..........................
Section 4.16
Company Leases.........................................
Section 4.14(f)
Company Parties........................................
Preamble
Company Properties.....................................
Section 4.14(a)
Company Property.......................................
Section 4.14(a)
Company Representatives................................
Section 7.04(a)
Company Series A Preferred Shares......................
Section 3.01(d)
Company Stockholder Approval...........................
Section 7.02
Company Stockholders' Meeting..........................
Section 7.02
Confidentiality Agreement..............................
Section 7.03(b)
Contemplated Transactions..............................
Recitals
Continuing Employees...................................
Section 7.05(b)
Effective Time.........................................
Section 2.03
Electing Unit..........................................
Section 3.03(d)
Electing Unit Consideration............................
Section 3.02(a)
Electing Unit Holder...................................
Section 3.02(a)
Election Form..........................................
Section 3.02(b)
Encumbrances...........................................
Section 4.14(a)
Environmental Permits..................................
Section 4.18(a)
ERISA..................................................
Section 4.11(a)
Exchange Act...........................................
Section 4.05(b)
Executive Officers.....................................
Section 7.05(a)
Existing Unit Holder...................................
Section 3.02(a)
Existing Units.........................................
Section 3.02(a)
8
<PAGE>
Expenses...............................................
Section 7.06(a)
Financing..............................................
Section 5.07
GAAP...................................................
Section 4.07(b)
Governmental Order.....................................
Section
9.01(c)
Ground Lease...........................................
Section 4.14(d)
Ground Leases..........................................
Section 4.14(d)
Guaranty...............................................
Recitals
Guarantor..............................................
Recitals
HSR Act................................................
Section 4.05(b)
Incentive Plan.........................................
Section 3.01(c)
Indemnified Parties....................................
Section 7.06(a)
Insurance Amount.......................................
Section 7.06(d)
IRS....................................................
Section 4.11(a)
Material Contract......................................
Section 4.19
Merger.................................................
Recitals
Merger Sub.............................................
Preamble
MGCL...................................................
Recitals
Net Parent Expenses....................................
Section 9.03(e)
NYSE...................................................
Section 4.05(b)
Operating Partnership..................................
Preamble
Operating Partnership Offer............................
Section 3.02(a)
Other Filings..........................................
Section 4.13
Outside Date...........................................
Section
9.01(b)
Parent.................................................
Preamble
Parent Consent Addressees..............................
Section 10.03
Parent Expenses........................................
Section 9.03(a)(i)
Parent Parties.........................................
Preamble
Parent Plan............................................
Section 7.05(b)
Paying Agent...........................................
Section 3.03(a)
Payment Fund...........................................
Section 3.03(a)
Permits................................................
Section 4.06(a)
Plans..................................................
Section 4.11(a)
Preferred Share Merger Consideration...................
Section 3.01(d)
Property Restrictions..................................
Section 4.14(a)
Proxy Statement........................................
Section 4.05(b)
Recommendation Withdrawal..............................
Section 7.02
REIT...................................................
Section 4.17(b)
Remaining Unit Holder..................................
Section 3.02(a)
Required Vote..........................................
Section 4.04(a)
Restricted Share.......................................
Section 3.01(c)
SDAT...................................................
Section 2.03
SEC....................................................
Section 4.05(b)
SEC Reports............................................
Section 4.07(a)
Section 16.............................................
Section 7.05(b)
Securities Act.........................................
Section 4.05(b)
Series A Preferred Partnership Units...................
Section 3.02(a)
9
<PAGE>
Special Committee......................................
Recitals
Surviving Entity.......................................
Section 2.01
Surviving Entity Charter and Bylaws....................
Section 2.02
Surviving Entity Series A Preferred Shares.............
Section 3.01(d)
Tax Protection Agreements..............................
Section 4.17(n)
Tax Returns............................................
Section 4.17(a)
Termination Date.......................................
Section 9.01
Third Party............................................
Section 4.14(e)
Transfer Taxes.........................................
Section 7.08
Section 1.02 Interpretation and Rules of Construction. In this
Agreement, except to the extent otherwise provided or that the
context
otherwise requires:
(a) when a reference is made in this Agreement to an
Article, Section, Exhibit or Schedule, such reference is to an
Article or
Section of, or an Exhibit or Schedule to, this Agreement unless
otherwise
indicated;
(b) the table of contents and headings for this Agreement
are for reference purposes only and do not affect in any way the
meaning or
interpretation of this Agreement;
(c) whenever the words "include," "includes" or
"including" are used in this Agreement, they are deemed to be
followed by the
words "without limitation";
(d) the words "hereof," "herein" and "hereunder" and words
of similar import, when used in this Agreement, refer to this
Agreement as a
whole and not to any particular provision of this Agreement;
(e) references to any statute, rule or regulation are to
the statute, rule or regulation as amended, modified, supplemented
or replaced
from time to time (and, in the case of a statute, include any rules
and
regulations promulgated under the statute) and references to any
section of
any statute, rule or regulation include any successor to the
section;
(f) all terms defined in this Agreement have the defined
meanings when used in any certificate or other document made or
delivered
pursuant hereto, unless otherwise defined therein;
(g) the definitions contained in this Agreement are
applicable to the singular as well as the plural forms of such
terms;
(h) references to a person are also to its successors and
permitted assigns; and
(i) the use of "or" is not intended to be exclusive unless
expressly indicated otherwise.
10
<PAGE>
ARTICLE II
THE MERGER
Section 2.01 General. Subject to the terms and conditions of
this Agreement, and in accordance with the MGCL, at the Effective
Time, Merger
Sub and the Company shall consummate the Merger pursuant to which
(i) the
Company shall be merged with and into the Merger Sub and the
separate
existence of the Company shall thereupon cease and (ii) Merger Sub
shall be
the surviving entity in the Merger (the "Surviving Entity"). The
Merger shall
have the effects specified in Section 3-114 of the MGCL.
Section 2.02 Charter and Bylaws. Merger Sub's Charter in the
form attached as Exhibit A hereto and Merger Sub's bylaws as in
effect
immediately prior to the Effective Time, shall be the charter and
bylaws,
respectively, of the Surviving Entity until thereafter amended in
accordance
with the provisions thereof and as provided by applicable Law (the
"Surviving
Entity Charter and Bylaws").
Section 2.03 Effective Time. At the Closing, Merger Sub and the
Company shall duly execute and file the Articles of Merger in
accordance with
the MGCL. The Merger shall become effective at such time as the
Articles of
Merger are accepted for record by the State Department of
Assessments and
Taxation of Maryland ("SDAT") or such later time as the parties
hereto shall
have agreed upon and designated in the Articles of Merger, but not
to exceed
thirty (30) days after the Articles of Merger are accepted for
record by the
SDAT (the "Effective Time").
Section 2.04 Closing. The closing of the Merger (the "Closing")
shall occur as promptly as practicable (but in no event later than
the second
Business Day) after all of the conditions set forth in Article VIII
(other
than conditions which by their terms are required to be satisfied
or waived at
the Closing, but subject to the satisfaction or waiver thereof)
shall have
been satisfied or waived by the party entitled to the benefit of
the same,
and, subject to the foregoing, shall take place at such time and on
a date to
be specified by the parties (the "Closing Date"). The Closing shall
take place
at the offices of Akin Gump Strauss Hauer & Feld LLP, 590
Madison Avenue, New
York, NY 10022, or at such other place as agreed to by the parties
hereto.
Section 2.05 Directors and Officers of the Surviving Entity;
General Partner.
(a) The directors of Merger Sub immediately prior to the
Effective Time shall be the directors of the Surviving Entity,
subject to any
rights under the Nomination Rights Agreement, and the officers of
the Company
immediately prior to the Effective Time shall be the officers of
the Surviving
Entity, in each case to hold office until their successors are
elected and
qualified.
(b) The general partner of the Operating Partnership
immediately after the Effective Time shall be the Surviving Entity,
and the
limited partners of the Operating Partnership immediately after the
Effective
Time shall be those Existing Unit Holders that elect not to accept
the
Operating Partnership Offer or did not timely submit an Election
Form to the
Company.
11
<PAGE>
ARTICLE III
EFFECTS OF THE MERGER
Section 3.01 Effects on Shares. As of the Effective Time, by
virtue of the Merger and without any action on the part of Parent,
Merger Sub,
the Company or any of their respective stockholders:
(a) Each common share of Merger Sub, par value $0.01 per
share, issued and outstanding immediately prior to the Effective
Time shall
remain outstanding and be unaffected by the Merger.
(b)
Each Company Common Share that is owned by any
Subsidiary or by Parent, Merger Sub or any other Subsidiary of
Parent
immediately prior to the Effective Time shall automatically be
canceled and
retired and shall cease to exist, and no payment shall be made with
respect
thereto.
(c) Each Company Common Share issued and outstanding
immediately prior to the Effective Time (including each restricted
share (a
"Restricted Share") granted under the Company's 2004 Long-Term
Incentive Plan
(the "Incentive Plan") or otherwise, but other than shares to be
canceled in
accordance with Section 3.01(b)) shall automatically be converted
into, and
canceled in exchange for, the right to receive an amount equal to
the sum of
(i) $13.35 (the "Company Common Share Cash Merger Consideration"),
and (ii) to
the extent the Company's regular dividend with respect to the
fiscal quarter
in which the Effective Time occurs has not previously been declared
and paid,
an amount in cash equal to $0.175 multiplied by the quotient
obtained by
dividing (x) the number of days between the last day of the last
fiscal
quarter for which full quarterly dividends on the Company Common
Shares have
been declared and paid and the Effective Time (including the date
on which the
Effective Time occurs) by (y) the total number of days in the
fiscal quarter
during which the Effective Time occurs, without interest (the
"Additional
Company Common Share Merger Consideration" and, together with the
Company
Common Share Cash Merger Consideration, the "Company Common Share
Merger
Consideration").
(d) Each share of the Company's 8.25% Series A Cumulative
Redeemable Preferred Shares, par value $0.01 per share (the
"Company Series A
Preferred Shares"), issued and outstanding immediately prior to the
Effective
Time shall be converted into one validly issued, fully paid and
nonassessable
share of the Surviving Entity's 8.25% Series A Cumulative
Redeemable Preferred
Shares, par value $0.01 per share having the rights and preferences
set forth
in Exhibit B hereto (the "Surviving Entity Series A Preferred
Shares" and the
consideration issued in exchange for the Company Series A Preferred
Shares,
the "Preferred Share Merger Consideration").
(e) By virtue of the Merger and without any action on the
part of Parent, Merger Sub, the Company or the holders of
Restricted Shares
granted pursuant to the Incentive Plan or otherwise, all Restricted
Shares
automatically shall become fully vested and free of any forfeiture
restriction
immediately prior to the Effective Time, and shall be considered
Company
Common Shares for all purposes of this Agreement, including receipt
of the
Company Common
12
<PAGE>
Share Merger Consideration. Prior to the Effective Time, the
Company will
adopt such resolutions and will take such other actions, including
adopting
any plan amendments and obtaining any required consents, as shall
be required
to effectuate the actions contemplated by this Section 3.01(e).
(f) If, subsequent to the date of this Agreement but prior
to the Effective Time, the outstanding Company Common Shares or
Company Series
A Preferred Shares shall have been changed into a different number
of shares
as a result of a stock split, reverse stock split, stock
dividend,
subdivision, reclassification, split, combination, exchange,
recapitalization,
or any dividend or other distribution payable in stock or other
securities is
declared thereon or rights issued in respect thereof with a record
date within
such period, or other similar transaction, the Company Common Share
Merger
Consideration or the Preferred Share Merger Consideration, as
applicable,
shall be appropriately adjusted so that the aggregate amount
payable pursuant
to this Agreement to effect the Merger and the Contemplated
Transactions shall
not have increased or decreased as a result of such adjustment.
Section 3.02 Effect on Units of Partnership Interest of the
Operating Partnership.
(a) In connection with the Merger and in accordance with
the procedures set forth in this Section 3.02, Parent and Merger
Sub shall
offer (the "Operating Partnership Offer") to each holder (each an
"Existing
Unit Holder") of units of limited partnership interest (the
"Existing Units")
of the Operating Partnership the opportunity to receive in cash, in
exchange
for each issued and outstanding Existing Unit held by such holder,
an amount
equal to the sum of (i) $13.35 and (ii) to the extent the Company's
regular
dividend with respect to the fiscal quarter in which the Effective
Time occurs
has not previously been declared and paid, an amount in cash equal
to $0.175
multiplied by the quotient obtained by dividing (x) the number of
days between
the last day of the fiscal quarter for which full quarterly
dividends on the
Company Common Shares have been declared and paid and the Effective
Time
(including the date on which the Effective Time occurs) by (y) the
total
number of days in the fiscal quarter in which the Effective Time
occurs,
without interest (the "Electing Unit Consideration") as long as the
Company
receives an Election Form from such holder (an "Electing Unit
Holder") in
accordance with the provisions of this Section 3.02. Any Existing
Unit Holder
who elects not to accept the Operating Partnership Offer or does
not timely
and properly return an Election Form as set forth in this Section
3.02 (a
"Remaining Unit Holder"), shall remain as a limited partner of the
Operating
Partnership and continue to hold Existing Units with the rights,
terms and
conditions set forth in the Operating Partnership Agreement, and
shall not be
entitled to receive the Electing Unit Consideration. The term
"Existing Unit"
shall not include those units of partnership interest issued by the
Operating
Partnership to the Company in consideration of the contribution by
the Company
to the Operating Partnership of the entire net proceeds received by
the
Company from the issuance of the Company Series A Preferred Shares
(such
units, "Series A Preferred Partnership Units").
(b) The Company shall prepare a form of election in form
and substance reasonably acceptable to Parent (the "Election
Form"),
describing the Operating Partnership Offer and pursuant to which
each Existing
Unit Holder will have the right to specify the number, if any, of
Existing
Units which it desires to have exchanged for the right to receive
an amount
equal to the Electing Unit Consideration. In order for an Existing
Unit Holder
to be eligible to
13
<PAGE>
elect to have its Existing Units redeemed pursuant to the
Operating
Partnership Offer, such Existing Unit Holder shall have submitted
an Election
Form in accordance with the procedures and time periods specified
in this
Section 3.02 and as shall be described more fully in the Election
Form.
(c) The Company shall mail or cause to be mailed an
Election Form to each Existing Unit Holder, together with any other
materials
that the Company and Parent determine to be necessary or prudent,
no later
than twenty (20) Business Days prior to the Closing Date. An
election to
receive the Electing Unit Consideration in the Operating
Partnership Offer
shall be effective only if a properly executed Election Form is
received by
the Company or its designees prior to 5:00 p.m., Eastern Time on
the Business
Day prior to the Closing Date, or such other date as the Company
and Parent
shall agree. If an Existing Unit Holder fails to return a duly
completed
Election Form within the time period specified in the Election
Form, such
holder shall be deemed to have elected to remain as a limited
partner of the
Operating Partnership and continue to hold Existing Units. Parent
and the
Company agree that (i) the Existing Unit Holders shall have the
right to
revoke any election made in connection with the Operating
Partnership Offer at
any time prior to the expiration of the time period stated in the
Election
Form, and (ii) the Operating Partnership Offer shall be conducted
in
accordance with applicable Law and the Operating Partnership
Agreement. Parent
and the Company, by mutual agreement, shall have the right to make
rules, not
inconsistent with the terms of this Agreement, governing the
validity of
Election Forms and the issuance and delivery of the Electing
Unit
Consideration, as applicable.
(d) Prior to the Closing Date, the Operating Partnership
shall declare a distribution with respect to each Existing Unit
that is not an
Electing Unit in an amount equal to the Additional Company Common
Share Merger
Consideration, the record date for such distribution to be the
close of
business on the date of the Effective Time or such other date as
the Company,
as general partner of the Operating Partnership, and Parent shall
agree. Such
distribution shall be paid as promptly as practicable after the
Effective Time
(but in any event within five (5) Business Days after the Effective
Time).
(e) Whenever any event occurs which is required to be set
forth in an amendment or supplement to the Election Form, (i)
Parent or the
Company, as the case may be, shall promptly inform the other of
such
occurrence, and (ii) Parent and the Company shall, in cooperation
with each
other, prepare any such amendment or supplement to the Election
Form, in form
and substance reasonably satisfactory to Parent, the indication of
such
satisfaction not to be unreasonably withheld or delayed.
(f) The obligation of the Company and Parent to consummate the
Operating
Partnership Offer shall be conditioned upon, and shall be subject
to, the
concurrent Closing of the Merger as provided in this Agreement.
Section 3.03 Paying Agent.
(a) Prior to the Effective Time, Parent shall appoint a
bank or trust company reasonably satisfactory to the Company to act
as Paying
Agent (the "Paying Agent") for the payment in accordance with this
Article III
of the Company Common Share Merger
14
<PAGE>
Consideration and the Electing Unit Consideration (collectively,
such cash
being referred to as the "Payment Fund"). On or before the
Effective Time,
Parent shall deposit with the Paying Agent the Company Common Share
Merger
Consideration and the Electing Unit Consideration, for the benefit
of the
holders of Company Common Shares and Electing Units, respectively.
The Parent
shall cause the Paying Agent to make, and the Paying Agent shall
make,
payments of the Company Common Share Merger Consideration and the
Electing
Unit Consideration out of the Payment Fund in accordance with this
Agreement.
The Payment Fund shall not be used for any other purpose. Any and
all interest
earned on cash deposited in the Payment Fund shall be paid to the
Surviving
Entity.
(b) At the Effective Time, the share transfer books of the
Company shall be closed and thereafter there shall be no further
registration
of transfers of the Company Common Shares. From and after the
Effective Time,
persons who held Company Common Shares immediately prior to the
Effective Time
shall cease to have rights with respect to such shares, except as
otherwise
provided for herein. On or after the Effective Time, any
Certificates of the
Company presented to the Paying Agent, the Surviving Entity or the
transfer
agent for any reason shall be exchanged for the Company Common
Share Merger
Consideration with respect to the Company Common Shares formerly
represented
thereby.
(c) Promptly after the Effective Time (but in any event
within two (2) Business Days after the Effective Time), the
Surviving Entity
shall cause the Paying Agent to mail to each person who immediately
prior to
the Effective Time held of record Company Common Shares: (i) a
letter of
transmittal (which shall specify that delivery of Certificates
shall be
effected, and risk of loss and title to the Certificates shall pass
to the
Paying Agent, only upon delivery of the Certificates to the Paying
Agent, and
which letter shall be in such form and have such other provisions
as Parent
may reasonably specify) and (ii) instructions for use in effecting
the
surrender of the holder's Certificates in exchange for the Company
Common
Share Merger Consideration to which the holder thereof is entitled.
Upon
surrender of a Certificate for cancellation to the Paying Agent or
to such
other agent or agents reasonably satisfactory to the Company as may
be
appointed by Parent, together with such letter of transmittal, duly
executed
and completed in accordance with the instructions thereto, and such
other
documents as may reasonably be required by the Paying Agent, the
holder of
such Certificate shall receive in exchange therefor the Company
Common Share
Merger Consideration payable in respect of the Company Common
Shares
previously represented by such Certificate pursuant to the
provisions of this
Article III, and the Certificate so surrendered shall forthwith be
canceled.
In the event of a transfer of ownership of Company Common Shares
that is not
registered in the transfer records of the Company, payment may be
made to a
person other than the person in whose name the Certificate so
surrendered is
registered, if such Certificate shall be properly endorsed or
otherwise be in
proper form for transfer and the person requesting such payment
shall pay any
transfer or other Taxes required by reason of the payment to a
person other
than the registered holder of such Certificate or establish to
the
satisfaction of Parent that such tax has been paid or is not
applicable. Until
surrendered as contemplated by this Section 3.03, each Certificate
shall be
deemed at any time after the Effective Time to represent only the
right to
receive, upon such surrender, the Company Common Share Merger
Consideration,
as contemplated by this Section 3.03. No interest shall be paid or
accrue on
the Company Common Share Merger Consideration.
15
<PAGE>
(d) As of the Effective Time, holders of Company Common
Shares shall cease to be, and shall have no rights as, stockholders
of the
Company other than the right to receive the Company Common Share
Merger
Consideration provided under this Article III. The Company Common
Share Merger
Consideration paid upon the surrender for exchange of
Certificates
representing Company Common Shares, in accordance with the terms of
this
Article III, shall be deemed to have been paid in full satisfaction
of all
rights and privileges pertaining to the Company Common Shares
exchanged
therefor and represented by such Certificates. As of the Effective
Time, the
holders of Existing Units for which a properly executed Election
Form is
timely received (an "Electing Unit") shall cease to be, and shall
have no
rights as, limited partners of the Operating Partnership other than
the right
to receive the Electing Unit Consideration provided under this
Article III.
(e) Any portion of the Payment Fund which remains
undistributed to the holders of Company Common Shares or Electing
Units for
twelve (12) months after the Effective Time shall be delivered to
the
Surviving Entity and any holders of Company Common Shares and
Electing Units
prior to the Merger who have not theretofore complied with this
Article III
shall thereafter look only to the Surviving Entity for payment of
the Company
Common Share Merger Consideration and the Electing Unit
Consideration, as
applicable.
(f) None of Parent, Merger Sub, the Surviving Entity, the
Company, the Operating Partnership or the Paying Agent, or any
employee,
officer, director, agent or Affiliate thereof, shall be liable to
any person
in respect of the Company Common Share Merger Consideration or the
Electing
Unit Consideration, as applicable, if the Payment Fund has been
delivered to a
public official pursuant to any applicable abandoned property,
escheat or
similar Law.
(g) The Paying Agent shall invest the cash included in the
Payment Fund, as directed by the Surviving Entity, on a daily
basis. Any net
profit resulting from, or interest or income produced by, such
investments
shall be placed in the Payment Fund. To the extent that there are
losses with
respect to such investments or the Payment Fund diminishes for
other reasons
below the level required to make prompt payments of the Company
Common Share
Merger Consideration or the Electing Unit Consideration as
contemplated
hereby, Parent shall promptly replace or restore the portion of the
Payment
Fund lost through investments or other events so as to ensure that
the Payment
Fund is, at all times, maintained at a level sufficient to make
such payments.
(h) If any Certificate shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the
person claiming
such Certificate to be lost, stolen or destroyed and, if required
by the
Surviving Entity or the Paying Agent, the posting by such person of
a bond in
such amount as the Surviving Entity or the Paying Agent reasonably
may direct,
the Paying Agent will issue in exchange for such lost, stolen or
destroyed
Certificate the Company Common Share Merger Consideration payable
in respect
thereof pursuant to this Agreement.
(i) Certificates representing Company Series A Preferred
Shares prior to the Effective Time shall represent Surviving Entity
Series A
Preferred Shares after the Effective Time.
16
<PAGE>
Section 3.04 Withholding Rights. The Surviving Entity or the
Paying Agent, as applicable, shall be entitled to deduct and
withhold from the
consideration otherwise payable pursuant to this Agreement to any
holder of
Company Common Shares or Electing Units such amounts as it is
required to
deduct and withhold with respect to the making of such payment
under the Code,
and the rules and regulations promulgated thereunder, or any
provision of
state, local or foreign tax law. To the extent that amounts are so
withheld by
the Surviving Entity or the Paying Agent, as applicable, such
withheld amounts
shall be treated for all purposes of this Agreement as having been
paid to the
holder of Company Common Shares or Electing Units in respect of
which such
deduction and withholding was made by the Surviving Entity or the
Paying
Agent, as applicable.
Section 3.05 Further Actions. If at any time after the
Effective Time, the Surviving Entity shall consider or be advised
that any
deeds, bills of sale, assignments or assurances or any other acts
or things
are necessary, desirable or proper (i) to vest, perfect or confirm,
of record
or otherwise, in the Surviving Entity its right, title or interest
in, to or
under any of the rights, privileges, powers, franchises, properties
or assets
of any of the Company, its Subsidiaries, the Operating Partnership
or Merger
Sub or (ii) otherwise to carry out the purposes of this Agreement,
the
Surviving Entity and its proper officers and directors or its
designees shall
be authorized to execute and deliver, in the name and on behalf of
the
Company, its Subsidiaries, Merger Sub and the Operating
Partnership, all such
deeds, bills of sale, assignments and assurances and do, in the
name and on
behalf of the Company, its Subsidiaries, Merger Sub and the
Operating
Partnership all such other acts and things necessary, desirable or
proper to
vest, perfect or confirm its right, title or interest in, to or
under any of
the rights, privileges, powers, franchises, properties or assets of
any of the
Company, its Subsidiaries, the Operating Partnership or Merger Sub,
as
applicable, and otherwise to carry out the purposes of this
Agreement.
ARTICLE IV
REPRESENTATIONS AND
WARRANTIES OF THE COMPANY AND THE OPERATING PARTNERSHIP
Except as set forth in the Company's SEC Reports or in the
Disclosure
Schedule, the Company and the Operating Partnership hereby
represent and
warrant to Parent Parties as follows:
Section 4.01 Organization and Qualification; Subsidiaries;
Authority.
(a) Each of the Company and the Operating Partnership is
duly organized, validly existing and in good standing under the
Laws of the
jurisdiction of its organization or formation and has the requisite
corporate,
limited partnership or similar power and authority to own, lease
and operate
its properties and to carry on its business as it is now being
conducted,
except where the failure to be so organized, existing and in good
standing or
to have such corporate, limited partnership, limited liability
company or
similar power and authority, individually or in the aggregate, have
not had
and would not reasonably be expected to have a Company Material
Adverse
Effect. Each of the Company's other Subsidiaries is duly organized,
validly
existing and in good standing under the Laws of the jurisdiction of
its
organization or formation and has the requisite corporate,
limited
partnership, limited liability
17
<PAGE>
company or similar power and authority to own, lease and operate
its
properties and to carry on its business as now being conducted,
except where
the failure to be so organized, existing and in good standing or to
have such
corporate, limited partnership, limited liability company or
similar power and
authority, individually or in the aggregate, have not had and would
not
reasonably be expected to have a Company Material Adverse Effect.
The Company
and each of its Subsidiaries are duly qualified or licensed to do
business and
in good standing (to the extent applicable), in each jurisdiction
in which the
nature of their business or the ownership or leasing of their
properties makes
such qualification or licensing necessary, except for such failures
to be so
duly qualified or licensed and in good standing that, individually
or in the
aggregate, have not had and would not reasonably be expected to
have a Company
Material Adverse Effect.
(b) A correct and complete list of all of the Company's
Subsidiaries, together with the jurisdiction of organization of
each
Subsidiary and the percentage of the outstanding equity of each
Subsidiary
owned by the Company, directly or indirectly, is set forth in
Section 4.01(b)
of the Disclosure Schedule.
Section 4.02 Organizational Documents. The Company Charter and
the Company Bylaws, the Operating Partnership Agreement, the
certificate of
limited partnership of the Operating Partnership and the
organizational
documents of the other Subsidiaries of the Company are in full
force and
effect, have been made available to the Parent Parties and no
dissolution,
revocation or forfeiture proceeding regarding the Company or any of
its
Subsidiaries has been commenced. The Company is not in violation of
the
Company Charter or the Company Bylaws, the Operating Partnership is
not in
violation of the Operating Partnership Agreement or its certificate
of limited
partnership, and none of the other Subsidiaries of the Company is
in violation
of any of the provisions of its certificate or articles of
incorporation or
bylaws or equivalent organizational documents, except, in each
case, for such
violations that, individually or in the aggregate, have not had and
would not
reasonably be expected to have a Company Material Adverse Effect.
The Company
has made available to the Parent Parties materially correct and
complete
copies of the minute books of the Company of meetings of the
Company Board and
committees of the Company Board held since January 1, 2006, except
that the
Company shall not be obligated to make available those portions of
any minutes
of meetings of the Company Board or committees of the Company Board
related to
the deliberations by the Company Board or such committee with
respect to the
consideration of strategic alternatives or that would involve
issues of
privilege.
Section 4.03 Capitalization.
(a) The authorized shares of stock of the Company consist
of (i) 100,000,000 Company Common Shares and (ii) 10,000,000 shares
of
preferred stock, of which 4,000,000 shares are classified as
Company Series A
Preferred Shares. At the close of business on April 27, 2007,
18,011,926
Company Common Shares were issued and outstanding and 4,000,000
Company Series
A Preferred Shares were issued and outstanding, 535,114 Company
Common Shares
were reserved for issuance pursuant to the Incentive Plan, subject
to
adjustment on the terms set forth in such plan, and 5,861,907
Company Common
Shares were reserved for issuance upon the redemption of Existing
Units, and
the Company had no Company Common Shares reserved for issuance or
required to
be reserved for issuance other than as described above. All such
issued and
outstanding shares of the Company are, and all shares subject
to
18
<PAGE>
issuance as specified above, upon issuance on the terms and
conditions
specified in the instruments pursuant to which they are issuable
will be, when
issued, duly authorized, validly issued, fully paid, nonassessable
and free of
preemptive rights under any provisions of the MGCL, the Company
Charter or the
Company Bylaws.
(b) Except for the Existing Units owned by limited
partners of the Operating Partnership other than the Company, or as
set forth
in Section 4.03(b) of the Disclosure Schedule, there are no
existing options,
warrants, calls, subscription rights, convertible securities or
other rights,
agreements or commitments (contingent or otherwise) that obligate
the Company
to repurchase, redeem or otherwise acquire any shares of stock or
equity
interests of the Company or any of its Subsidiaries or to issue,
deliver or
sell or create, or cause to be issued, delivered or sold or
created,
additional shares of stock or other voting or equity securities or
interests
of the Company or of any of its Subsidiaries or obligating the
Company or any
of its Subsidiaries to issue, grant, extend or enter into any such
security,
option, warrant, call, right, commitment, agreement, arrangement
or
undertaking relating to the voting of stock or equity securities or
interests
of the Company or any of its Subsidiaries.
(c) Except as set forth in Section 4.03(c) of the
Disclosure Schedule, there are no agreements or understandings to
which the
Company is a party with respect to the voting of any shares of
common stock of
the Company, nor, to the Knowledge of the Company, as of the date
of this
Agreement, do any third party agreements or understandings exist
with respect
to the voting of any such shares. There are no outstanding bonds,
debentures,
notes or other indebtedness of the Company having the right to vote
(or
convertible into, or exchangeable for, securities having the right
to vote) on
any matter on which the Company's stockholders may vote.
(d) Except as set forth in Section 4.03(d) of the
Disclosure Schedule, the Company is under no obligation, contingent
or
otherwise, by reason of any agreement to register the offer and
sale or resale
of any of its securities under the Securities Act.
(e) (i) As of the date of this Agreement, 23,873,833
Existing Units are validly issued and outstanding and not subject
to
preemptive rights, and 5,861,907 Existing Units are owned by
limited partners
of the Operating Partnership other than the Company.
(i) The Company is the sole general partner of the
Operating Partnership and, as of the date hereof, owns, directly
or
indirectly, 18,011,926 Existing Units and 4,000,000 Series A
Preferred
Partnership Units. Except as set forth in Section 4.03(e) of the
Disclosure
Schedule, there are no existing options, warrants, calls,
subscription rights,
convertible securities or other rights, agreements or commitments
(contingent
or otherwise) that obligate the Operating Partnership to issue,
transfer or
sell any partnership interests of the Operating Partnership or any
investment
that is convertible into or exercisable or exchangeable for any
such
partnership interests. The partnership interests in the Operating
Partnership
that are owned by the Company are subject only to the restrictions
on transfer
set forth in the Operating Partnership Agreement and those imposed
by
applicable securities laws.
(ii) Each Existing Unit may, under certain
circumstances set forth in the Operating Partnership Agreement, be
redeemed
for cash or for Company
19
<PAGE>
Common Shares on a one-for-one basis, subject to adjustment as
provided in the
Operating Partnership Agreement.
Section 4.04 Authority Relative to this Agreement; Validity and
Effect of Agreements.
(a) The Company has all necessary corporate power and
authority to execute and deliver this Agreement, to perform its
obligations
hereunder and to consummate the Contemplated Transactions. The
execution and
delivery of this Agreement by the Company and the consummation by
the Company
of the Contemplated Transactions have been duly and validly
authorized by all
necessary corporate action, and no other corporate proceedings on
the part of
the Company are necessary to authorize this Agreement or the Merger
or to
consummate the Contemplated Transactions (other than (i) the
approval of this
Agreement, the Merger and the Contemplated Transactions by the
affirmative
vote of the holders of a majority of the total number of shares of
capital
stock of the Company outstanding and entitled to vote thereupon
voting
together as a single class (the "Required Vote"), and (ii) the
filing with,
and acceptance for record by, the SDAT of the Articles of Merger).
This
Agreement has been duly and validly executed and delivered by the
Company and,
assuming the due authorization, execution and delivery by each of
the Parent
and Merger Sub, constitutes a legal, valid and binding obligation
of the
Company, enforceable against the Company in accordance with its
terms, except
as enforceability may be limited by applicable bankruptcy,
insolvency,
reorganization, moratorium, fraudulent transfer and similar Laws of
general
applicability relating to or affecting creditors' rights or by
general equity
principles. The Required Vote is the only vote of the holders of
any class or
series of stock of the Company required to approve this Agreement,
the Merger
and the Contemplated Transactions.
(b) The Operating Partnership has all necessary limited
partnership power and authority to execute and deliver this
Agreement, to
perform its obligations hereunder and to consummate the
Contemplated
Transactions. The execution and delivery of this Agreement by the
Operating
Partnership and the consummation by the Operating Partnership of
the
Contemplated Transactions have been duly and validly authorized by
all
necessary partnership action, and no other partnership proceedings
on the part
of the Operating Partnership are necessary to authorize this
Agreement or to
consummate the Contemplated Transactions. This Agreement has been
duly and
validly executed and delivered by the Operating Partnership and,
assuming the
due authorization, execution and delivery by each of Parent and
Merger Sub,
constitutes a legal, valid and binding obligation of the
Operating
Partnership, enforceable against the Operating Partnership in
accordance with
its terms, except as enforceability may be limited by applicable
bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer and
similar Laws
of general applicability relating to or affecting creditors' rights
or by
general equity principles.
Section 4.05 No Conflict; Required Filings and Consents.
(a) Except for the Company Stockholder Approval and except
as set forth in Section 4.05(a) of the Disclosure Schedule, the
execution and
delivery by the Company and the Operating Partnership of this
Agreement do
not, and the performance of their respective obligations hereunder
will not,
(i) conflict with or violate (1) the Company Charter or the
20
<PAGE>
Company Bylaws, (2) the Operating Partnership Agreement or the
certificate of
limited partnership of the Operating Partnership, or (3) the
certificate or
articles of incorporation or bylaws or equivalent organizational
documents of
any of the Company's other Subsidiaries, (ii) assuming that all
consents,
approvals, authorizations and other actions described in subsection
(b) have
been obtained and all filings and obligations described in
subsection (b) have
been made, conflict with or violate any Law applicable to the
Company, the
Operating Partnership or any other Subsidiary of the Company or by
which any
property or asset of the Company, the Operating Partnership or any
other
Subsidiary of the Company is bound, or (iii) result in any breach
of or
constitute a default (or an event which, with notice or lapse of
time or both,
would become a default) under, or give to others any right of
termination,
amendment, acceleration or cancellation of, or result in the
creation of a
Lien on any property or asset of the Company, the Operating
Partnership or any
other Subsidiary of the Company pursuant to, or give rise to a
right of
purchase, first offer or forced sale under any Material Contract,
except, with
respect to clauses (ii) and (iii), for any such conflicts,
violations,
breaches, defaults or other occurrences that individually or in the
aggregate,
have not had and would not reasonably be expected to have a Company
Material
Adverse Effect.
(b) Except as set forth in Section 4.05(b) of the
Disclosure Schedule, the execution and delivery by the Company and
the
Operating Partnership of this Agreement does not, and the
performance of their
respective obligations hereunder and thereunder will not, require
any consent,
approval, authorization or permit of, or filing with or
notification to, any
Governmental Authority, except (i) for (A) applicable requirements,
if any, of
the Securities Act of 1933, as amended (the "Securities Act"), the
Securities
Exchange Act of 1934, as amended (the "Exchange Act"), state
securities or
"blue sky" laws ("Blue Sky Laws") and state takeover Laws, (B) the
pre-merger
notification requirements of the Hart-Scott-Rodino Antitrust
Improvements Act
of 1976, as amended (the "HSR Act"), if required, (C) the filing
with the
Securities and Exchange Commission (the "SEC") of a proxy statement
relating
to the Merger to be sent to the Company's stockholders (as amended
or
supplemented from time to time, the "Proxy Statement"), (D) any
filings
required under the rules and regulations of the New York Stock
Exchange (the
"NYSE"), and (E) the filing of the Articles of Merger with, and the
acceptance
for record thereof by, the SDAT, and (ii) where the failure to
obtain such
consents, approvals, authorizations or permits, or to make such
filings or
notifications, would not, individually or in the aggregate, have or
reasonably
be expected to have a Company Material Adverse Effect.
Section 4.06 Permits; Compliance with Laws.
(a) Each of the Company, the Operating Partnership and the
other Subsidiaries of the Company is in possession of all
franchises, grants,
authorizations, licenses, permits, consents, certificates,
approvals and
orders of any Governmental Authority necessary for each of the
Company, the
Operating Partnership or the other Subsidiaries of the Company to
own, lease
and operate its properties or to carry on its business as it is now
being
conducted (collectively, the "Permits"), and all the Permits are
valid and in
full force and effect, except where the failure to obtain and
maintain the
Permits, or the suspension or cancellation of any of the Permits,
individually
or in the aggregate, has not had or would not reasonably be
expected to have a
Company Material Adverse Effect.
21
<PAGE>
(b) None of the Company, the Operating Partnership or any
other Subsidiary of the Company is in conflict with, or in default,
breach or
violation of, (i) any Laws applicable to the Company, the
Operating
Partnership or any other Subsidiary of the Company or by which any
property or
asset of the Company, the Operating Partnership or any other
Subsidiary of the
Company is bound, (ii) any Permit, or (iii) any Material Contract
to which the
Company, the Operating Partnership or any other Subsidiary of the
Company is a
party or by which the Company, the Operating Partnership or any
other
Subsidiary of the Company or any property or asset of the Company,
the
Operating Partnership or any other Subsidiary of the Company is
bound, except
in the case of clauses (i), (ii) and (iii) for any such conflicts,
defaults,
breaches or violations that, individually or in the aggregate, have
not had
and would not reasonably be expected to have a Company Material
Adverse Effect
or prevent or materially delay the consummation of the Merger.
Section 4.07 SEC
Filings; Financial Statements.
(a) The Company has filed with the SEC all forms, reports,
statements, schedules, certifications, and documents (including all
exhibits)
required to be filed by it with the SEC since December 31, 2004
(the "SEC
Reports"). The SEC Reports (including any documents or
information
incorporated by reference), as of their respective filing dates (i)
complied,
and all documents filed by the Company with the SEC under the
Securities Act
or the Exchange Act between the date of this Agreement and the date
of Closing
will comply, in all material respects as to form with the
requirements of the
Securities Act or the Exchange Act, as the case may be, and the
rules and
regulations promulgated thereunder each as in effect on the date so
filed, and
(ii) at the time filed with the SEC, did not contain any untrue
statement of a
material fact, or, in the case of documents filed on or after the
date hereof
will not contain any untrue statement of a material fact, and did
not omit,
or, in the case of documents filed on or after the date hereof,
will not omit
to state a material fact required to be stated therein or necessary
in order
to make the statements made therein, in light of the circumstances
under which
they were made, not misleading.
(b) The audited consolidated financial statements and
unaudited consolidated interim financial statements of the Company
and its
consolidated Subsidiaries included or incorporated by reference
into the SEC
Reports (including, in each case, any notes thereto): (i) were
prepared in
accordance with United States generally accepted accounting
principles
("GAAP") (except, in the case of unaudited statements, as permitted
by the
applicable rules and regulations of the SEC) applied on a
consistent basis
throughout the periods indicated (except as may be indicated in the
notes
thereto), (ii) complied in all material respects with applicable
accounting
requirements and the rules and regulations of the SEC and (iii)
fairly
presented, in all material respects, the consolidated financial
position,
results of operations and cash flows of the Company and its
consolidated
Subsidiaries, as the case may be, as of the dates thereof and for
the periods
indicated therein except as otherwise noted therein (subject, in
the case of
unaudited statements, to normal year-end adjustments).
(c) The Company has made available to the Parent Parties
correct and complete copies of all material written correspondence
between the
SEC, on the one hand, and the Company and any of its Subsidiaries,
on the
other hand, occurring since December 31, 2004 and prior to the date
hereof and
will, promptly following the receipt thereof, make available to
22
<PAGE>
the Parent Parties any such material correspondence sent or
received after the
date hereof. To the Knowledge of the Company, as of the date of
this
Agreement, the Company has no outstanding and unresolved comments
from the SEC
with respect to any SEC Reports.
(d) The Company has (i) implemented and maintains
disclosure controls and procedures (as defined in Rule 13a-15(e) of
the
Exchange Act) designed to ensure that material information relating
to the
Company, including the consolidated Subsidiaries of the Company, is
made known
to the management of the Company, and (ii) has disclosed, based on
its most
recent evaluation prior to the date hereof, to the Company's
outside auditors
and the audit committee of the Company Board (A) all significant
deficiencies
and material weaknesses in the design or operation of internal
control over
financial reporting (as defined in Rule 13a-15(f) of the Exchange
Act) which
are reasonably likely to adversely affect the Company's ability to
record,
process, summarize and report financial data and (B) any fraud
whether or not
material, that involves management or other employees who have a
significant
role in the Company's internal controls over financial
reporting.
(e) The Company has not identified, based on its most
recent evaluation, any material weaknesses in the design or
operation of
internal controls over financial reporting.
Section 4.08 No Unknown Liabilities. As of the date hereof,
neither the Company nor any of its Subsidiaries has any liability
or
obligation of any nature (whether accrued, absolute, contingent or
otherwise)
which would be required to be reflected, reserved for or disclosed
in a
consolidated balance sheet of the Company and its consolidated
Subsidiaries,
including the notes thereto, prepared in accordance with GAAP
except (a) as
reflected, reserved for or disclosed in the consolidated balance
sheet of the
Company and its consolidated Subsidiaries as at December 31, 2006,
including
the notes thereto (the "2006 Balance Sheet"), (b) as incurred since
December
31, 2006 in the ordinary course of business consistent with past
practice, (c)
as incurred or to be incurred by the Company or any Subsidiary of
the Company
pursuant to, in connection with, or as a result of, the Merger and
the
Contemplated Transactions, (d) as set forth in Section 4.08 of the
Disclosure
Schedule or (e) as individually or in the aggregate, have not had
and would
not reasonably be expected to have a Company Material Adverse
Effect.
Section 4.09 Absence of Certain Changes or Events. Since
December 31, 2006 through the date hereof, except (a) as
contemplated by this
Agreement, (b) as set forth in Section 4.09 of the Disclosure
Schedule or (c)
as disclosed in the SEC Reports filed since December 31, 2006 and
prior to the
date of this Agreement, there has not been any Company Material
Adverse
Effect.
Section 4.10 Absence of Litigation. Except (a) as listed in
Section 4.10 of the Disclosure Schedule or (b) as set forth in the
SEC Reports
filed prior to the date hereof, as of the date hereof, there is no
Action
pending or, to the Knowledge of the Company, threatened against any
of the
Company or any of its Subsidiaries or any of its or their
respective
properties or assets or any director, officer or employee of any of
the
Company or any of its Subsidiaries, except as would not,
individually or in
the aggregate, (i) prevent or materially impair or delay the
ability of the
Company or the Operating Partnership to perform its obligations
under this
Agreement, the consummation of the Merger or the Contemplated
Transactions or
(ii) have or reasonably be
23
<PAGE>
expected to have a Company Material Adverse Effect. None of the
Company or any
of its Subsidiaries is subject to any order, judgment, writ,
injunction or
decree, except as would not, individually or in the aggregate, (x)
prevent or
materially impair or delay the ability of the Company or the
Operating
Partnership to perform its obligations under this Agreement, the
consummation
of the Merger or the Contemplated Transactions or (y) have or
reasonably be
expected to have a Company Material Adverse Effect.
Section 4.11 Employee Benefit Plans.
(a) Section 4.11(a) of the Disclosure Schedule lists as of
the date hereof, all employee benefit plans (as defined in Section
3(3) of the
Employee Retirement Income Security Act of 1974, as amended
("ERISA")) and all
material bonus, stock option, stock purchase, restricted stock,
incentive,
deferred compensation, retiree medical or life insurance,
supplemental
retirement, severance or other benefit plans, programs or
arrangements, and
all material employment, termination, severance or other contracts
or
agreements to which the Company or any Subsidiary of the Company is
a party,
with respect to which the Company or any Subsidiary of the Company
has any
obligation or which are maintained, contributed to or sponsored by
the Company
or any Subsidiary of the Company for the benefit of any employee,
officer or
director of the Company or any Subsidiary of the Company
(collectively, the
"Plans"). The Company has made available to Parent copies of the
following:
(i) the Plans, (ii) the most recent annual report (Form 5500) filed
with the
Internal Revenue Service ("IRS"), if any, (iii) the most recently
received IRS
determination letter, if any, relating to a Plan, and (iv) the most
recently
prepared actuarial report or financial statement, if any, relating
to a Plan.
(b) Except as set forth in Section 4.11(b) of the
Disclosure Schedule, (i) each Plan has been operated in accordance
with its
terms and the requirements of all applicable Laws, including ERISA
and the
Internal Revenue Code of 1986, as amended (the "Code"), and any
such
non-compliance would not, individually or in the aggregate, have or
reasonably
be expected to have a Company Material Adverse Effect, (ii) no
Action is
pending or, to the Knowledge of the Company, threatened with
respect to any
Plan (other than claims for benefits in the ordinary course) that
would,
individually or in the aggregate, have or reasonably be expected to
have a
Company Material Adverse Effect and (iii) all employer or
employee
contributions, premiums and expenses to or in respect of each Plan
have been
paid in full or, to the extent not yet due, have been adequately
accrued on
the applicable financial statements of the Company included in the
SEC Reports
in accordance with GAAP. There is no Person (other than the Company
or any of
its Subsidiaries) that together with the Company or any of its
Subsidiaries
would be treated as a single employer under Section 414 of the Code
or Section
4001(b) of ERISA. None of the Company, any of its Subsidiaries, nor
any
employer that would be considered a single employer with the
Company under
Sections 414(b), (c), (m) or (o) of the Code has at any time during
the
six-year period preceding the date hereof maintained, contributed
to or
incurred any liability under any "multiemployer plan" (as defined
in Section
3(37) of ERISA) or any Plan that is subject to Title IV of ERISA or
Section
412 of the Code.
(c) Each Plan that is intended to be qualified under
Section 401(a) of the Code or Section 401(k) of the Code has
received a
favorable determination letter from the IRS, or is entitled to rely
on a
favorable opinion letter issued by the IRS, and to the Knowledge of
the
Company no fact or event has occurred since the date of such
determination
letter or
24
<PAGE>
letters from the IRS to adversely affect the qualified status of
any such Plan
or the exempt status of any such trust that would, individually or
in the
aggregate, have or reasonably be expected to have a Company
Material Adverse
Effect.
(d) Except as set forth in Section 4.11(d) of the
Disclosure Schedule, no Plan, either individually or collectively,
provides
for any payment by the Company or any Subsidiary of the Company
that would
constitute a "parachute payment" within the meaning of Section 280G
of the
Code after giving effect to the Contemplated Transactions.
(e) Except as set forth in Section 4.11(e) of the
Disclosure Schedule, neither the execution and delivery of this
Agreement by
the Company nor the consummation of the transactions contemplated
hereby will
or may (either alone or in connection with the occurrence of any
additional or
subsequent events) (i) result in the acceleration or creation of
any rights of
any Person to compensation or benefits under any Plan or other
compensatory
arrangement, loan forgiveness or result in an obligation to fund
benefits with
respect to any Plan or other compensatory arrangement; or (ii)
constitute an
event under any Plan or other arrangement that will or may result
in any
payment of deferred compensation subject to Section 409A of the
Code.
(f) The Company has made available to the Parent Parties
all of the employment agreements, bonus agreements, severance
agreements,
severance plans and similar obligations that include amounts that
are payable
as a result of consummation transactions contemplated hereby.
Section 4.11(f)
of the Disclosure Schedule sets forth a good faith estimate of the
amounts
that will become payable to employees of the Company under the
terms of any
employment agreements, bonus agreements, severance agreements,
severance plans
and similar obligations as a result of the consummation of the
transactions
contemplated by this Agreement.
Section 4.12 Labor Matters.
(a) Except as set forth in Section 4.12 of the Disclosure
Schedule, (i) neither the Company nor any of its Subsidiaries is a
party to
any collective bargaining agreement or other labor union contract
applicable
to persons employed by the Company or any of its Subsidiaries, (ii)
except as
would not, individually or in the aggregate, have or reasonably be
expected to
have a Company Material Adverse Effect, there is no strike,
slowdown, work
stoppage or lockout by or with respect to any employees of the
Company or any
of its Subsidiaries, and (iii) no labor organization or group of
employees of
the Company or any of its Subsidiaries has made a written demand
for
recognition or certification (iv) there are no representation or
certification
proceedings or petitions seeking a representation proceeding
presently filed
with the National Labor Relations Board or any other labor
relations tribunal
or authority concerning any employee of the Company or any of
its
Subsidiaries.
(b) There are no unfair labor practice charges, grievances
or complaints filed by or on behalf of any employee or group of
employees of
the Company or any of its Subsidiaries that have not been settled
or remedied
that would reasonably be expected to have a Material Adverse Effect
on the
Company and its Subsidiaries, taken as a whole.
25
<PAGE>
Section 4.13 Information Supplied. The information relating to
the Company and its Subsidiaries to be contained in the Proxy
Statement
(including information incorporated by reference) or any other
document to be
filed with the SEC in connection herewith (the "Other Filings")
will not, in
the case of the Proxy Statement, at the date it is first mailed to
the
Company's stockholders or at the time of the Company Stockholders'
Meeting or
at the time of any amendment or supplement thereof, or, in the case
of any
Other Filing, at the date it is first mailed to the Company's
stockholders or
at the date it is first filed with the SEC, contain any untrue
statement of a
material fact or omit to state any material fact required to be
stated therein
or necessary in order to make the statements therein, in light of
the
circumstances under which they are made, not misleading, except
that no
representation is made by the Company or the Operating Partnership
with
respect to statements made or incorporated by reference therein
based on
information supplied by Parent or Merger Sub in connection with
the
preparation of the Proxy Statement or the Other Filings for
inclusion or
incorporation by reference therein. The Proxy Statement and the
Other Filings
that are required to be filed by the Company in connection with the
Merger or
the other Contemplated Transactions will comply as to form in all
material
respects with the applicable requirements of the Securities Act and
the
Exchange Act.
Section 4.14 Property and Leases.
(a) Section 4.14(a) of the Disclosure Schedule sets forth
a correct and complete list and address of all real property
interests owned
or held by the Company and the Subsidiaries as of the date of this
Agreement,
including fee interests, ground leasehold interests and other
similar
leasehold interests (all such real property interests, together
with all
buildings, structures and other improvements and fixtures located
on or under
such real property and all easements, rights and other
appurtenances to such
real property, are individually referred to herein as "Company
Property" and
collectively referred to herein as the "Company Properties"). The
Operating
Partnership or other Subsidiaries of the Company own or, if so
indicated in
Section 4.14(a) of the Disclosure Schedule, lease each of the
Company
Properties, in each case, free and clear of any Liens, title
defects,
covenants or reservations of interests in title (collectively,
"Property
Restrictions"), except for (i) Permitted Liens, (ii) Property
Restrictions
imposed or promulgated by Law or by any Governmental Authority
which are
customary and typical for similar properties that, individually or
in the
aggregate, do not interfere materially with the current use or
operation of
such property, (iii) Property Restrictions disclosed on existing
title reports
or existing surveys or which would be shown on current title
reports or
current surveys that, individually or in the aggregate, do not
interfere
materially with the current use or operation of such property,
(iv)
mechanics', carriers', workmen's or repairmen's liens and other
encumbrances
for wh
