Exhibit 1.1
KITE REALTY GROUP
TRUST
$25,000,000
CONTROLLED EQUITY OFFERING SM
SALES AGREEMENT
October 20, 2006
CANTOR FITZGERALD & CO.
110 East 59th Street
New York, NY 10022
Ladies and Gentlemen:
KITE REALTY GROUP TRUST, a Maryland
real estate investment trust (the “ Company
”), and KITE REALTY GROUP, L.P., a Delaware limited
partnership, the sole general partner of which is the Company (the
“ Operating Partnership ”) , confirm
their agreement (this “ Agreement ”) with
Cantor Fitzgerald & Co. (“ CF&Co
”), as follows:
1.
Issuance and Sale of Shares . The Company agrees that,
from time to time during the term of this Agreement, on the terms
and subject to the conditions set forth herein, it may issue and
sell through CF&Co, acting as agent and/or principal, (a) up to
$25,000,000 of the Company’s common shares of beneficial
interest, par value $0.01 per share (the “ Common
Shares ”). The Company’s Common Shares
issued or issuable pursuant to this Agreement shall be referred to
herein as the “ Shares ”. The
issuance and sale of Shares through CF&Co will be effected
pursuant to the Registration Statement (as defined below) filed by
the Company and declared effective by the Securities and Exchange
Commission (the “ Commission ”), although
nothing in this Agreement shall be construed as requiring the
Company to use the Registration Statement to issue Common
Shares.
The Company has filed, in accordance
with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations thereunder (collectively, the “
Securities Act ”), with the Commission a
registration statement on Form S-3 (File No. 333-127586), including
a base prospectus, relating to certain securities, including the
Shares to be issued from time to time by the Company, and which
incorporates by reference documents that the Company has filed or
will file under Section 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934, as amended, and the rules and regulations
thereunder (collectively, the “ Exchange Act
”). The Company has prepared a prospectus supplement
specifically relating to the Shares (the “ Prospectus
Supplement ”) to the base prospectus included as part
of such registration statement. The Company has furnished to
CF&Co, for use by CF&Co, copies of the prospectus included
as part of such registration statement, as supplemented by the
Prospectus Supplement, relating to the Shares. Except where
the context otherwise requires, such registration statement, as
amended, including all documents filed as part thereof or
incorporated by reference therein, and including any information
contained in a Prospectus (as defined below) subsequently filed
with the Commission pursuant to Rule 424(b) under the Securities
Act or deemed to be a part of such
registration statement pursuant to
Rule 430B of the Securities Act and also including any registration
statement filed to register additional Shares pursuant to Rule
462(b) under the Securities Act (a “ Rule 462(b)
Registration Statement ”), collectively, are herein
called the “ Registration Statement .”
The base prospectus, including all documents incorporated therein
by reference, included in the Registration Statement, as
supplemented by the Prospectus Supplement, in the form in which
such prospectus and/or Prospectus Supplement have most recently
been filed by the Company with the Commission pursuant to Rule
424(b) under the Securities Act, together with any “issuer
free writing prospectus,” as defined in Rule 433 of the
Securities Act (“ Rule 433 ”), relating
to the Shares that (i) is required to be filed with the Commission
by the Company or (ii) is exempt from filing pursuant to Rule
433(d)(5)(i), in each case in the form filed or required to be
filed with the Commission or, if not required to be filed, in the
form retained in the Company’s records pursuant to Rule
433(g), is herein called the “ Prospectus
.” Any reference herein to the Registration Statement, the
Prospectus or any amendment or supplement thereto shall be deemed
to refer to and include the documents, if any, incorporated by
reference therein, and any reference herein to the terms
“amend,” “amendment” or
“supplement” with respect to the Registration Statement
or the Prospectus shall be deemed to refer to and include the
filing after the execution hereof of any document with the
Commission pursuant to the Exchange Act that are deemed to be
incorporated by reference therein. For purposes of this Agreement,
all references to the Registration Statement, the Prospectus or to
any amendment or supplement thereto shall be deemed to include any
copy filed with the Commission pursuant to its Electronic Data
Gathering Analysis and Retrieval System (“
EDGAR ”).
2.
Placements . Each time that the Company wishes to
issue and sell Shares hereunder (each, a “
Placement ”), it will notify CF&Co by email
notice (or other method mutually agreed to in writing by the
Parties) containing the parameters in accordance with which it
desires the Shares to be sold, which shall at a minimum include the
number and/or maximum aggregate offering price of Shares to be
issued (the “ Placement Shares ”), the
time period during which sales are requested to be made, any
limitation on the number of Shares that may be sold in any one day
and any minimum price below which sales may not be made (a “
Placement Notice ”), a form containing such
minimum sales parameters necessary is attached hereto as
Schedule 1 . The Placement Notice shall
originate from any of the individuals from the Company set forth on
Schedule 2 (with a copy to each of the other
individuals from the Company listed on such schedule), and shall be
addressed to each of the individuals from CF&Co set forth on
Schedule 2 , as such Schedule 2 may be
amended from time to time. The Placement Notice shall be effective
upon receipt by CF&Co unless and until (i) in accordance with
the notice requirements set forth in Section 4 , CF&Co
declines to accept the terms contained therein for any reason, in
its sole discretion, (ii) the entire amount of the Placement Shares
have been sold, (iii) in accordance with the notice requirements
set forth in Section 4 , the Company suspends or terminates
the Placement Notice, (iv) the Company issues a subsequent
Placement Notice with parameters superseding those on the earlier
dated Placement Notice, or (iv) the Agreement has been terminated
under the provisions of Section 11 . The amount
of any discount, commission or other compensation to be paid by the
Company to CF&Co in connection with the sale of the Placement
Shares shall be calculated in accordance with the terms set forth
in Schedule 3 . It is expressly acknowledged
and agreed that neither the Company nor CF&Co will have any
obligation whatsoever with respect to a Placement or any Placement
Shares unless and until the Company delivers a Placement Notice to
CF&Co and CF&Co does not decline such Placement Notice
pursuant to the terms set forth above, and then only upon the terms
specified therein and herein. In the event of a conflict
between the terms of this Agreement and the terms of a Placement
Notice, the terms of the Placement Notice will control.
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3.
Sale of Placement Shares by CF&Co. Subject to the
terms and conditions herein set forth, upon the Company’s
issuance of a Placement Notice, and unless the sale of the
Placement Shares described therein has been declined, suspended, or
otherwise terminated in accordance with the terms of this
Agreement, CF&Co, for the period specified in the Placement
Notice, will use its commercially reasonable efforts consistent
with its normal trading and sales practices to sell such Placement
Shares, up to the amount specified, on the New York Stock Exchange
(the “ Exchange ”) or the principal
trading market or exchange on which the Common Shares are at the
time listed or quoted, and otherwise in accordance with the terms
of such Placement Notice. CF&Co will provide written
confirmation to the Company no later than the opening of the
Trading Day (as defined below) immediately following the Trading
Day on which it has made sales of Placement Shares hereunder
setting forth the number of Placement Shares sold on such day, the
compensation payable by the Company to CF&Co pursuant to
Section 2 with respect to such sales, and the Net Proceeds (as
defined below) payable to the Company, with an itemization of the
deductions made by CF&Co (as set forth in Section 5(a)) from
the gross proceeds that it receives from such sales. After
consultation to the Company and subject to the terms of the
Placement Notice, CF&Co may sell Placement Shares by any method
permitted by law deemed to be an “at the market”
offering as defined in Rule 415 of the Securities Act, including
without limitation sales made directly on the Exchange, on any
other existing trading market for the Common Shares or to or
through a market maker. After consultation with, and subject
to the approval of, the Company and further subject to the terms of
the Placement Notice, CF&Co may also sell Placement Shares in
privately negotiated transactions. The Company acknowledges
and agrees that (i) there can be no assurance that CF&Co will
be successful in selling Placement Shares, and (ii) CF&Co will
incur no liability or obligation to the Company or any other person
or entity if it does not sell Placement Shares for any reason other
than a failure by CF&Co to use its commercially reasonable
efforts consistent with its normal trading and sales practices to
sell such Placement Shares as required under this Section 3
. For the purposes hereof, “ Trading Day
” means any day on which Common Shares are purchased and sold
on the principal market on which the Common Shares are listed or
quoted.
4.
Suspension of Sales . The Company or CF&Co may,
upon notice to the other party in writing (including by email
correspondence to each of the individuals of the other Party set
forth on Schedule 2 , if receipt of such
correspondence is actually acknowledged by any of the individuals
to whom the notice is sent, other than via auto-reply) or by
telephone (confirmed immediately by verifiable facsimile
transmission or email correspondence to each of the individuals of
the other Party set forth on Schedule 2 ), suspend
any sale of Placement Shares and the selling period (if specified
in the applicable Placement Notice) shall immediately terminate;
provided, however , that such suspension shall not affect or
impair either party’s obligations with respect to any
Placement Shares sold hereunder prior to the receipt of such
notice. Each of the Parties agrees that no such notice under
this Section 4 shall be effective against the other unless
it is made to one of the individuals named on Schedule
2 hereto, as such Schedule may be amended from time to
time.
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5.
Settlement.
(a)
Settlement of Placement Shares . Unless otherwise
specified in the applicable Placement Notice, settlement for sales
of Placement Shares will occur on the third (3 rd )
Trading Day (or such earlier day as is industry practice for
regular-way trading) following the date on which such sales are
made (each, a “ Settlement Date ”).
The amount of proceeds to be delivered to the Company on a
Settlement Date against receipt of the Placement Shares sold (the
“ Net Proceeds ”) will be equal to the
aggregate sales price received by CF&Co at which such Placement
Shares were sold, after deduction for (i) CF&Co’s
commission, discount or other compensation for such sales payable
by the Company pursuant to Section 2 hereof, and (ii) any
other amounts due and payable by the Company to CF&Co hereunder
pursuant to Section 7(g) (Expenses) hereof.
(b)
Delivery of Placement Shares . On or before each
Settlement Date, the Company will, or will cause its transfer agent
to, electronically transfer the Placement Shares being sold by
crediting CF&Co’s or its designee’s account
(provided CF&Co shall have given the Company written notice of
such designee prior to the Settlement Date) at The Depository Trust
Company through its Deposit/Withdrawal at Custodian System, or by
such other means of delivery as may be mutually agreed upon by the
parties hereto, which in all cases shall be freely tradeable,
transferable, registered shares in good deliverable form. On
each Settlement Date, CF&Co will deliver the related Net
Proceeds in same day funds to an account designated by the Company
on, or prior to, the Settlement Date. The Company agrees that
if the Company defaults in its obligation to deliver Placement
Shares on a Settlement Date, the Company agrees that in addition to
and in no way limiting the rights and obligations set forth in
Section 9(a) (Indemnification and Contribution) hereto, it
will (i) hold CF&Co harmless against any loss, claim,
damage, or expense (including reasonable legal fees and expenses),
as incurred, arising out of or in connection with such default by
the Company and (ii) pay to CF&Co any commission, discount, or
other compensation to which it would otherwise have been entitled
absent such default.
6.
Representations and Warranties of the Company and the Operating
Partnership . The
Company and the Operating Partnership jointly and severally
represent and warrant to, and agree with, CF&Co that as of the
date of this Agreement and as of each Representation Date (as
defined in Section 7(m) below) on which a certificate is
required to be delivered pursuant to Section 7(m) of this
Agreement and as of each Applicable Time, as the case may
be:
(a)
The Registration Statement has become or has been declared
effective by the Commission under the Securities Act. The
Company has complied to the Commission’s satisfaction with
all requests of the Commission for additional or supplemental
information. No stop order suspending the effectiveness of
the Registration Statement or preventing or suspending the use of
the Prospectus is in effect and no proceeding for such purpose has
been instituted or, to the knowledge of the Company, threatened by
the Commission.
(b)
The Registration Statement, as of each effective date with respect
thereto (including at each deemed effective date with respect to
CF&Co pursuant to Rule 430B(f)(2) of the Securities Act)
complied and will comply in all material respects with the
requirements of the Securities Act; and the Prospectus will, when
filed with the Commission, comply in all material respects with the
requirements of the Securities Act. The conditions for use of
Form S-3, as set forth in the General Instructions thereto, have
been satisfied.
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(c)
The Registration Statement, as of the date hereof and each
effective date with respect thereto (including at each deemed
effective date with respect to CF&Co pursuant to Rule
430B(f)(2) of the Securities Act), did not and will not contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading; and the Prospectus did not, and,
as amended or supplemented, if applicable, will not contain an
untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided,
however, that the foregoing shall not apply to information or
statements in, or omissions from, any such document made in
reliance upon, and in conformity with, written information
furnished to the Company by or on behalf of CF&Co specifically
for inclusion therein or for use in the preparation
thereof.
(d)
The Company has delivered to CF&Co one complete conformed copy
of the Registration Statement as originally filed with the
Commission and a copy of each consent and certificate of experts
filed as a part thereof, and the Company will furnish to CF&Co,
upon request, conformed copies of the Registration Statement
(without exhibits) and the Prospectus, as amended or supplemented,
in such quantities and at such places as CF&Co has reasonably
requested. The Prospectus delivered to CF&Co for use in
connection with the offering of Shares will, at the time of such
delivery, be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the
extent permitted by Regulation S-T.
(e)
Each document incorporated by reference in the Registration
Statement or the Prospectus, when it was filed with the Commission,
conformed in all material respects to the requirements of the
Securities Act or the Exchange Act, as applicable, and none of such
documents contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; and
any further documents so filed and incorporated by reference in the
Registration Statement or the Prospectus, when such documents are
filed with the Commission, will conform in all material respects to
the requirements of the Securities Act or the Exchange Act, as
applicable, and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not
misleading.
(f)
Each issuer free writing prospectus (as defined in Rule 433)
relating to the Shares, as of its issue date and at all subsequent
times through the completion of the public offer and sale of the
Shares to which such free writing prospectus relates or until any
earlier date that the Company notifies CF&Co in writing, does
not and will not include any information that conflicts or will
conflict with the information contained in the Registration
Statement, including any document incorporated by reference therein
that has not been superseded or modified.
(g)
The Company is not an Ineligible Issuer (as defined in Rule 405 of
the Securities Act), without taking into account any determination
by the Commission pursuant to such Rule 405 that it is not
necessary that the Company be considered an Ineligible
Issuer. Any free
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writing prospectus relating to the
Shares that the Company is required to file pursuant to Rule 433(d)
of the Securities Act has been, or will be, filed with the
Commission in accordance with the requirements of the Securities
Act; and each free writing prospectus relating to the Shares that
the Company has filed, or is required to file, pursuant to Rule
433(d) of the Securities Act or that was prepared by or on behalf
of or used by the Company complies or will comply in all material
respects with the requirements of the Securities Act.
(h)
The Company has not distributed and will not distribute any
offering material in connection with the offering and sale of the
Shares to be sold hereunder by CF&Co as principal or agent for
the Company, other than the Prospectus and the Registration
Statement.
(i)
The Company has been duly formed and is validly existing as a real
estate investment trust in good standing under the laws of the
State of Maryland, is duly qualified to do business and is validly
existing or in good standing as a foreign corporation in each
jurisdiction in which its ownership or lease of property and other
assets or the conduct of its business requires such qualification,
except where the failure to so qualify will not have a material
adverse effect on the business, prospects, operations, management,
consolidated financial position, net worth, shareholders’
equity or results of operations of the Company and its subsidiaries
considered as one enterprise, collectively (a “
Material Adverse Effect ”), and has all power
and authority necessary to own or hold its properties and other
assets to conduct the businesses in which it is engaged and to
enter into and perform its obligations under this Agreement.
The Company has no “significant subsidiaries” (as such
term is defined in Rule 1-02 of Regulation S-X promulgated under
the Securities Act) other than the Operating
Partnership.
(j)
The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued Common Shares (other than the
Shares) have been duly and validly authorized and issued, are fully
paid and non-assessable, have been offered and sold in compliance
with all applicable laws (including, without limitation, federal or
state securities laws), and conform to the description thereof
contained in the Prospectus. None of the outstanding Common
Shares was issued in violation of the preemptive or other similar
rights of any securityholder of the Company. Except as
disclosed in the Prospectus, (i) no Common Shares are reserved for
any purpose, except for (x) Common Shares issuable upon the
exercise of options or other equity awards pursuant to any share
option, share bonus or other share plan or arrangement described in
the Prospectus and (y) Common Shares issuable upon the redemption
of outstanding units of limited partnership interest in the
Operation Partnership (“ Units ”) in
accordance with the Operating Partnership Agreement, (ii) except
for Units, there are no outstanding securities convertible into or
exchangeable for any Common Shares or other securities of the
Company, and (iii) there are no outstanding options, rights
(preemptive or otherwise) or warrants to purchase or subscribe for
Shares or any other securities of the Company. All of the
Company’s options, warrants and other rights to purchase or
exchange any securities for Common Shares have been duly authorized
and validly issued, conform to the description thereof contained in
the Prospectus and were issued in compliance with federal and state
securities laws.
(k)
The Operating Partnership has been duly formed and is validly
existing as a limited partnership in good standing under the laws
of the State of Delaware, is duly qualified to do business and is
validly existing or in good standing as a foreign limited
partnership in each jurisdiction in which its ownership or lease of
property and other assets or the conduct of its business requires
such qualification, except where the failure to so qualify will not
have a
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Material Adverse Effect, and has all
power and authority necessary to own or hold its properties and
other assets, to conduct the business in which it is engaged and to
enter into and perform its obligations under this Agreement.
The Company is the sole general partner of the Operating
Partnership. The Agreement of Limited Partnership of the
Operating Partnership, as amended (the “ Operating
Partnership Agreement ”), is in full force and
effect, and, as of the date of this Agreement, the aggregate
percentage interests of the Company and the limited partners in the
Operating Partnership is as disclosed in the Prospectus.
(l)
The Shares to be sold by CF&Co, acting as agent and/or
principal for the Company, have been duly and validly authorized
and, when issued and delivered against payment therefor as provided
herein, will be duly and validly issued, fully paid and
non-assessable and free and clear of all liens. The terms of the
Shares conform in all material respects to the descriptions thereof
contained in the Prospectus. The form of the certificates
used to evidence the Shares is in due and proper form and complies
with all applicable legal requirements, the requirements of the
Organizational Documents of the Company and the requirements of the
Exchange. The issuance of the Shares is not subject to any
preemptive or other similar rights.
(m)
All outstanding Units have been duly authorized for issuance by the
Operating Partnership and have been validly issued and have been
offered and sold in compliance with all applicable laws (including,
without limitation, federal or state securities laws). The
terms of the Units conform in all material respects to the
descriptions thereof contained in the Prospectus. Except as
disclosed in the Prospectus, (i) no Units are reserved for any
purpose, (ii) there are no outstanding securities convertible into
or exchangeable for any Units, and (iii) there are no outstanding
options, rights (preemptive or otherwise) or warrants to purchase
or subscribe for Units or any other securities of the Operating
Partnership.
(n)
Each of the Company and the Operating Partnership has all requisite
power and authority to execute, deliver and perform its obligations
under this Agreement. This Agreement has been duly authorized,
executed and delivered by each of the Company and the Operating
Partnership and is a valid and binding agreement, enforceable
against the Company and the Operating Partnership in accordance
with its terms, except to the extent that enforcement thereof may
be limited by bankruptcy, insolvency, reorganization or other laws
affecting enforcement of creditors’ rights or by general
equitable principles.
(o)
The Operating Partnership Agreement has been duly and validly
authorized, executed and delivered by the Company and is a valid
and binding agreement, enforceable against the Company and the
Operating Partnership in accordance with its terms, except to the
extent that enforcement thereof may be limited by bankruptcy,
insolvency, reorganization or other laws affecting enforcement of
creditors’ rights or by general equitable principles.
The Operating Partnership Agreement has been duly executed and
delivered by the other parties thereto and, to the Company’s
knowledge, is a valid and binding agreement enforceable against
such parties in accordance with its terms, except to the extent
that enforcement thereof may be limited by bankruptcy, insolvency,
reorganization or other laws affecting enforcement of
creditors’ rights or by general equitable
principles.
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(p)
The execution, delivery and performance of this Agreement by the
Company and the Operating Partnership, the consummation of the
transactions contemplated hereby and the application of the
proceeds from the sale of Shares as described under “Use of
Proceeds” in the Prospectus will not conflict with or result
in a breach or violation of any of the terms or provisions of, or
result in the creation or imposition of a lien upon any property or
assets of the Company or any subsidiary thereof, or constitute
(with or without the giving of notice or the passage of time, or
both) a default (or give rise to any right of termination,
cancellation or acceleration) under (i) any of the terms,
conditions or provisions of any note, bond, indenture, mortgage,
deed of trust, lease, license, contract, loan agreement or other
agreement or instrument to which the Company or any subsidiary
thereof is a party or by which the Company or any subsidiary
thereof is bound or to which any of the properties or other assets
of the Company or any subsidiary thereof is subject, (ii) any of
the provisions of the Organizational Documents of the Company or
any subsidiary thereof, or (iii) any statute or any order, writ,
injunction, decree, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company or any
subsidiary thereof or any of their properties or assets, except for
any such breach or violation in the case of (i) or (iii) above that
would not, individually or in the aggregate, have a Material
Adverse Effect; and except for the registration of the Shares under
the Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the
Exchange Act, by the Exchange, or the National Association of
Securities Dealers, Inc., and applicable state securities laws in
connection with the purchase and distribution of the Shares by
CF&Co, no consent, approval, authorization or order of, or
filing or registration with, any such court or governmental agency
or body is required for the execution, delivery and performance of
the Agreement by the Company and the Operating Partnership and the
consummation of the transactions contemplated hereby.
(q)
Except as disclosed in the Registration Statement or the
Prospectus, there are no contracts, agreements or understandings
between the Company and any person, which, by reason of the
execution by the Company and the Operating Partnership of this
Agreement, grant such person the right to require the Company to
file a registration statement under the Securities Act with respect
to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in
any securities being registered pursuant to any other registration
statement filed by the Company under the Securities Act.
(r)
Except as disclosed in the Prospectus, the Company has not sold or
issued any securities during the six-month period preceding the
date of the Prospectus, including any sales pursuant to Rule 144A
under, or Regulations D or S of, the Securities Act.
(s)
Neither the Company nor any of its subsidiaries has sustained,
since the date of the latest audited financial statements included
in the Prospectus or incorporated by reference in the Prospectus,
any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental action, order or
decree, other than as disclosed in the Prospectus, that would have,
individually or in the aggregate, a Material Adverse Effect; and,
since such date, there has not been any change in the shares of
beneficial interest or long-term debt of the Company or its
subsidiaries other than loans entered into by the Company in the
ordinary course of business or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting any of the Properties or the business, prospects,
operations, management, financial position, net worth,
shareholders’ equity or results of operations of the Company
and its subsidiaries considered as one enterprise, other than as
disclosed in the Prospectus.
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(t)
The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement
or included in the Prospectus present fairly the financial
condition, the results of operations, the statements of cash flows
and the statements of shareholders’ equity and other
information purported to be shown thereby of the Company and its
consolidated subsidiaries, at the dates and for the periods
indicated, have been prepared in conformity with GAAP (as defined
below) applied on a consistent basis throughout the periods
involved and are correct and complete and are in accordance with
the books and records of the Company and its consolidated
subsidiaries. The summary and selected financial data and
other supporting schedules included in the Prospectus present
fairly, in all material respects, the information shown therein as
at the respective dates and for the respective periods specified,
and the summary and selected financial data and other supporting
schedules have been presented on a basis consistent with the
financial statements so set forth in the Prospectus and other
financial information. Pro forma financial information
included in the Prospectus has been prepared in accordance with the
applicable requirements of the Securities Act with respect to pro
forma financial information and includes all adjustments necessary
to present fairly, in all material respects, the pro forma
financial position of the Company at the respective dates indicated
and the results of operations for the respective periods specified,
and the assumptions used in the preparation thereof are reasonable
and provide a reasonable basis for presenting the significant
effects directly attributable to the transactions or events
described therein. No other financial statements or schedules
(including pro forma financial statements) of the Company, or any
predecessor of the Company, or any other person or for any property
are required by the Securities Act to be included in the
Registration Statement or the Prospectus.
(u)
Ernst & Young LLP, whose reports appear in the Prospectus or
incorporated by reference therein, are, and during the periods
covered by such reports were, registered independent public
accountants as required by the Securities Act, the Exchange Act and
the Public Company Accounting Oversight Board (“
PCAOB ”), and any other public accountants
whose reports appear in the Prospectus or are incorporated by
reference therein are, and during the periods covered by such
reports were, independent registered public accountants as required
by the Securities Act, the Exchange Act and the PCAOB.
(v)
The Company or its subsidiaries have fee simple title (or, as
disclosed in the Prospectus, a leasehold interest) to all of the
properties described in the Prospectus (the “
Properties ”), in each case, free and clear of
all liens, encumbrances, claims, security interests and defects,
except such as (i) are disclosed in the Prospectus, (ii) would not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect; neither the Company nor its subsidiaries
has received from any governmental authority any written notice of
any condemnation of or zoning change affecting the Properties or
any part thereof, and neither the Company nor its subsidiaries
knows of any such condemnation or zoning change which is
threatened, which if consummated would reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect;
true, correct and complete copies of the leases, exhibits,
schedules or other documents that comprise the leases described in
the section of the Prospectus entitled “Our Company”
where the tenant has been specifically identified (the “
Major Leases ”) have been made available for
review by CF&Co or its counsel; there are no other
material
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agreements between the Company or
any subsidiary and a tenant under a Major Lease relating to any of
the Properties; and except as otherwise disclosed in the
Prospectus, neither the Company nor, to the knowledge of the
Company, any tenant of any of the Properties is in default under
(i) any space leases (as lessor or lessee, as the case may be)
relating to the Properties, or (ii) any of the mortgages or other
security documents or other agreements encumbering or otherwise
recorded against the Properties, and the Company does not know of
any event which, but for the passage of time or the giving of
notice, or both, would constitute a default under any of such
documents or agreements, except with respect to (i) and (ii)
immediately above any such default that would not, individually or
in the aggregate, have a Material Adverse Effect.
(w)
To the knowledge of the Company, water, stormwater, sanitary sewer,
electricity and telephone service are all available at the property
lines of each Property over duly dedicated streets or perpetual
easements of record benefiting the applicable Property.
(x)
Except as disclosed in the Prospectus, all entitlements necessary
for development and/or renovation of each of the properties planned
for development, material expansion or renovation as described in
the Prospectus as having been vested or entitled with development
rights have been obtained, and no further governmental or
regulatory approvals are necessary for additional development of
such properties. With respect to any other property currently
planned for development, material expansion or renovation and which
is not disclosed in the Prospectus as having received all necessary
entitlements, the Company expects that such entitlements will be
issued in normal course.
(y)
There are no contracts, letters of intent, term sheets, agreements,
arrangements or understandings with respect to the direct or
indirect acquisition or disposition by the Company of interests in
assets or real property that are required to be disclosed in the
Prospectus that are not already so disclosed.
(z)
The mortgages or deeds of trust which encumber the Properties are
not convertible into equity securities of the entity owning such
Property and said mortgages and deeds of trust are not
cross-defaulted or cross-collateralized with any property other
than other Properties. Neither the Company nor any of its
subsidiaries holds participating interests in such mortgages or
deeds of trust.
(aa)
Except as disclosed in the Prospectus and except in respect of
lease of Properties, the Operating Partnership or a subsidiary
thereof has title insurance on the fee interests in each of the
Properties, in an amount that is commercially reasonable for each
Property.
(bb)
Except as otherwise disclosed in the Prospectus, (i) to the best
knowledge of the Company, the Company and its subsidiaries and the
Properties have been and are in material compliance with, and
neither the Company nor its subsidiaries have any material
liability under, applicable Environmental Laws (as hereinafter
defined); (ii) neither the Company, any of its subsidiaries, nor,
to the best knowledge of the Company, any prior owners or occupants
of the property at any time or any other party has at any time
released (as such term is defined in Section 101 (22) of CERCLA (as
hereinafter defined)) or otherwise disposed of or dealt with,
Hazardous Materials (as hereinafter defined) on, to or from the
Properties or other assets owned by the Company or its
subsidiaries, except for such releases as would not be reasonably
likely to cause the Company or its subsidiaries to incur material
liability; (iii) the Company or its
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subsidiaries do not intend to use
the Properties other than in compliance with applicable
Environmental Laws, (iv) other than as described in Schedule
4 hereto, neither the Company nor any of its
subsidiaries knows of any seepage, leak, discharge, release,
emission, spill, or dumping of Hazardous Materials into waters
(including, but not limited to, groundwater and surface water) on,
beneath or adjacent to the Properties or onto lands or other assets
owned by the Company or its subsidiaries from which Hazardous
Materials might seep, flow or drain into such waters; (v) neither
the Company nor any of its subsidiaries has received any written
notice of, or has any knowledge of any occurrence or circumstance
which, with notice or passage of time or both, would give rise to a
claim under or pursuant to any Environmental Law by any
governmental or quasi-governmental body or any third party with
respect to the Properties or the assets described in the Prospectus
or arising out of the conduct of the Company or its subsidiaries,
except for such claims that would not be reasonably likely to cause
the Company or its subsidiaries to incur material liability and
that would not require disclosure pursuant to Environmental Laws or
federal or state laws regulating the issuance of securities; (vi)
to the best knowledge of the Company, none of the Properties are
included or proposed for inclusion on the National Priorities List
issued pursuant to CERCLA by the United States Environmental
Protection Agency or to the best of the Company’s knowledge,
proposed for inclusion on any similar list or inventory issued
pursuant to any other Environmental Law or issued by any other
federal, state or local governmental authority having or claiming
jurisdiction over the Properties and other assets described in the
Prospectus. Except as otherwise disclosed in the Prospectus
or in Schedule 4 hereto, to the knowledge of
the Company, there have been no and are no (i) aboveground or
underground storage tanks; (ii) polychlorinated biphenyls (“
PCBs ”) or PCB-containing equipment; (iii)
asbestos or asbestos containing materials; (iv) lead based paints;
or (v) dry-cleaning facilities in, on, under, or about any Property
owned by the Company or their subsidiaries.
As used herein, “Hazardous
Material” shall include, without limitation, any flammable
explosives, radioactive materials, hazardous materials, hazardous
wastes, toxic substances, asbestos or any hazardous material as
defined by any federal, state or local environmental law,
ordinance, rule or regulation including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, 42 U.S.C. §§ 9601-9675
(“CERCLA”), the Hazardous Materials Transportation Act,
as amended, 49 U.S.C. §§ 1801-1819, the Resource
Conservation and Recovery Act, as amended, 42 U.S.C. §§
6901-K, the Emergency Planning and Community Right-to-Know Act of
1986, 42 U.S.C. §§ 11001-11050, the Toxic Substances
Control Act, 15 U.S.C. §§ 2601-2671, the Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. §§
136-136y, the Clean Air Act, 42 U.S.C. §§ 7401-7642, the
Clean Water Act (Federal Water Pollution Control Act), 33 U.S.C.
§§ 1251-1387, and the Safe Drinking Water Act, 42 U.S.C.
§§ 300f-300j-26, as any of the above statutes may be
amended from time to time, and in the regulations promulgated
pursuant to any of the foregoing (individually, an “
Environmental Law ” and collectively “
Environmental Laws ”).
(cc)
The Company and each of its subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks
and in such amounts and covering such risks as are customary in the
businesses in which they are engaged or propose to engage after
giving effect to the transactions described in the
Prospectus.
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