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EXHIBIT 1.2
AMLI RESIDENTIAL PROPERTIES TRUST
1,000,000 SHARES
SALES AGREEMENT
May 12, 2005
STIFEL, NICOLAUS & COMPANY,
INCORPORATED
501 North Broadway - 9th Floor
St. Louis, Missouri 63102
Ladies and Gentlemen:
AMLI
RESIDENTIAL PROPERTIES TRUST, a Maryland statutory real estate
investment trust (the "COMPANY") and AMLI
Residential Properties, L.P., a
Delaware limited partnership (the
"OPERATING PARTNERSHIP"), confirm their
agreement (this "AGREEMENT") with Stifel,
Nicolaus & Company, Incorporated
("STIFEL"), 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 Stifel, acting as agent and/or
principal, up to ONE MILLION (1,000,000) of
the Company's common shares of
beneficial interest, par value $0.01 per
share (the "COMMON SHARES" or the
"SHARES"); provided, however, that, in no
event shall the aggregate market value
of the Common Shares registered pursuant to
the Registration Statement (as
defined below) sold in an "at the market"
offering (as defined in Section 3
below) hereunder or any other similar
arrangement exceed $69,520,040.
Notwithstanding anything to the contrary
contained herein, the parties hereto
agree that compliance with the limitations
set forth in this Section 1 on the
number and aggregate market value of Shares
issued and sold under this Agreement
shall be the sole responsibility of the
Company, and Stifel shall have no
obligation in connection with such
compliance. The issuance and sale of Shares
through Stifel 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").
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. 333-123966), including a base
prospectus, with respect to the Shares
and other securities of the Company, and
which incorporates by reference
documents that the Company has filed or
will file in accordance with the
provisions 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 (the
"PROSPECTUS SUPPLEMENT") to the base
prospectus included as part of such
registration statement. The Company will
furnish to Stifel within three days of the
date of this Agreement, for use by
Stifel, copies of one or more prospectuses
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 when it
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became effective, 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 and also
including any other registration
statement filed pursuant to Rule 462(b)
under the Securities Act, collectively,
are herein called the "REGISTRATION
STATEMENT," and the base prospectus,
including all documents incorporated
therein by reference, included in the
Registration Statement, as supplemented by
the Prospectus Supplement, in the
form filed by the Company with the
Commission pursuant to Rule 424(b) under the
Securities Act 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 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 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").
As described in the Prospectus, the Company
owns partnership interests in the
Operating Partnership. The term "SERVICE
COMPANIES" includes Amli Management
Company (the "MANAGEMENT COMPANY"), Amli
Institutional Advisors, Inc. ("AIA")
and Amli Residential Construction, LLC
("AMRESCON"). Capitalized terms used
herein but not otherwise defined shall have
the respective meanings ascribed to
such terms in the Prospectus.
2. Placements. Each time
that the Company wishes to issue and sell Shares
hereunder (each, a "PLACEMENT"), it will
notify Stifel of the proposed terms of
such Placement. If Stifel wishes to accept
such proposed terms (which it may
decline to do for any reason in its sole
discretion) or, following discussions
with the Company, wishes to accept amended
terms, Stifel will issue to the
Company a written notice setting forth the
terms that Stifel is willing to
accept, including without limitation the
number of Shares ("PLACEMENT SHARES")
to be issued, the manner(s) in which sales
are to be made, the date or dates on
which such sales are anticipated to be
made, any minimum price below which sales
may not be made, and the capacity in which
Stifel may act in selling Placement
Shares hereunder (as principal, agent or
both) (a "PLACEMENT NOTICE"), the form
of which is attached hereto as Schedule 1.
The amount of any discount,
commission or other compensation to be paid
by the Company to Stifel shall be
equal to (i) two percent (2.0%) of gross
proceeds of the sale of the first
150,000 Placement Shares issued and sold
hereunder in any calendar month and
(ii) three percent (3.0%) of gross proceeds
of the sale of any Placement Shares
issued and sold hereunder in excess 150,000
Placement Shares in any calendar
month. The terms set forth in a Placement
Notice will not be binding on the
Company or Stifel unless and until the
Company delivers written notice of its
acceptance of all of the terms of such
Placement Notice (an "ACCEPTANCE") to
Stifel; provided, however, that neither the
Company nor Stifel will be bound by
the terms of a Placement Notice unless the
Company delivers to Stifel an
Acceptance with respect thereto prior to
4:30 p.m. (New York time) on the
Business Day (as defined below) following
the Business Day on which such
Placement Notice is delivered to the
Company. Written notice of Acceptance may
be accomplished via verifiable facsimile
transmission. It is expressly
acknowledged and agreed that neither the
Company nor Stifel will
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have any obligation whatsoever with respect
to a Placement or any Placement
Shares unless and until Stifel delivers a
Placement Notice to the Company and
the Company accepts such Placement Notice
by means of an Acceptance, 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.
3. Sale of Placement Shares
by Stifel. Subject to the terms and conditions
herein set forth, upon the Acceptance of a
Placement Notice, and unless the sale
of the Placement Shares described therein
has been suspended or otherwise
terminated in accordance with the terms of
this Agreement, Stifel will use its
commercially reasonable efforts to sell
such Placement Shares up to the amount
specified, and otherwise in accordance with
the terms of such Placement Notice.
Stifel will provide written confirmation to
the Company no later than the
opening of the Trading Day (as defined
below) next 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
Stifel with respect to such sales, and the
Net Proceeds (as defined below)
payable to the Company, with an itemization
of deductions made by Stifel (as set
forth in Section 5(a)) from gross proceeds
that it receives from such sales.
Stifel 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 New York Stock Exchange (the
"EXCHANGE"), on any other existing trading
market for the Common Shares or to or
through a market maker or through an
electronic communications network. Stifel
may also sell Placement Shares in privately
negotiated transactions. The Company
acknowledges and agrees that (i) there can
be no assurance that Stifel will be
successful in selling Placement Shares, and
(ii) Stifel 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 Stifel 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.
(a) The
Company or Stifel may, upon notice to the other party in
writing
(including by email correspondence if
receipt of such correspondence is actually
acknowledged by the party to whom the
notice is sent, other than via auto-reply)
or by telephone (confirmed immediately by
verifiable facsimile transmission),
suspend any sale of Placement Shares;
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 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.
(b) If any
party has reason to believe that the exemptive provisions set
forth in Rule 101(c)(1) of Regulation M
under the Exchange Act are not satisfied
with respect to the Shares, it shall
promptly notify the other party and sales
of Placement Shares under this Agreement
and any Placement Agreement shall be
suspended until that or other exemptive
provisions have been satisfied in the
judgment of each party.
5. Settlement.
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(a)
Settlement of Placement Shares. Unless otherwise specified in
the
applicable Placement Notice, settlement for
sales of Placement Shares will occur
on the third (3rd) Business Day (or such
other 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 the receipt of the
Placement Shares sold ("NET
PROCEEDS") will be equal to the aggregate
sales price at which such Placement
Shares were sold, after deduction for (i)
Stifel's commission, discount or other
compensation for such sales payable by the
Company pursuant to Section 2 hereof,
(ii) any other amounts due and payable by
the Company to Stifel hereunder
pursuant to Section 7(g) hereof, and (iii)
any transaction fees imposed by any
governmental or self-regulatory
organization in respect of such sales.
(b)
Delivery of 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 Stifel's or
its designee's (provided Stifel shall
have given the Company written notice of
such designee prior to the Settlement
Date) account at The Depository Trust
Company through its Deposit and Withdrawal
at Custodian System or by such other means
of delivery as may be mutually agreed
upon by the parties hereto and, upon
receipt of such Placement Shares, which in
all cases shall be freely tradable,
transferable, registered shares in good
deliverable form, Stifel will deliver the
related Net Proceeds in same day funds
delivered to an account designated by the
Company prior to the Settlement Date.
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) hereto, it will (i) hold
Stifel 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 Stifel any
commission, discount, or other compensation
to which it would otherwise have
been entitled absent such default.
6. Representations and
Warranties of the Company. Each of the Company and the
Operating Partnership jointly and severally
represents and warrants to, and
agrees with, Stifel 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, as the case
may be:
(a) The
Company meets the requirements for use of Form S-3 under the
Securities Act. The Registration Statement
has been filed with the Commission
and has been declared effective under the
Securities Act. The Registration
Statement has named Stifel as an
underwriter, acting as principal and/or agent
that the Company might engage in the
section entitled "Plan of Distribution".
The Company has not received, and has no
notice of, any order of the Commission
preventing or suspending the use of the
Registration Statement, or threatening
or instituting proceedings for that
purpose. Any statutes, regulations,
contracts or other documents that are
required to be described in the
Registration Statement or the Prospectus or
to be filed as exhibits to the
Registration Statement have been so
described or filed. The Prospectus
Supplement has been or will be so prepared
and will be filed pursuant to Rule
424(b) of the Securities Act. Copies of the
Registration Statement, the
Prospectus, and any such amendments or
supplements and all documents
incorporated by reference therein that were
filed with the Commission on or
prior to the date of this Agreement have
been delivered, or made available, to
Stifel and their counsel. The Company has
not distributed and will not
distribute any offering
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material in connection with the offering or
sale of the Placement Shares other
than the Registration Statement and the
Prospectus. The Common Shares are
currently listed on the Exchange under the
trading symbol "AML".
(b) Each
part of the Registration Statement, when such part became or
becomes effective or was or is filed with
the Commission, and the Prospectus,
and any amendment or supplement thereto, on
the date of filing thereof with the
Commission and at each Settlement Date,
conformed or will conform in all
material respects with the requirements of
the Securities Act. Each part of the
Registration Statement, when such part
became or becomes effective or was or is
filed with the Commission, did not, or 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. The Prospectus and
any amendment or supplement thereto, on the
date of filing thereof with the
Commission and at each Settlement Date, did
not or will not include an untrue
statement of a material fact or omit to
state a material fact necessary to make
the statements therein, in the light of the
circumstances under which they were
made, not misleading, except that the
foregoing shall not apply to statements
in, or omissions from, any such document
made in reliance upon, and in
conformity with, written information
concerning Stifel that was furnished in
writing to the Company by Stifel
specifically for use in the preparation
thereof. There are no contracts or other
documents required to be described in
the Prospectus or to be filed or
incorporated by reference as exhibits to the
Registration Statement which have not been
described or filed or incorporated by
reference as required.
(c) The
documents incorporated by reference in the Registration
Statement,
the Prospectus or any amendment or
supplement thereto, when they became or
become effective under the Securities Act
or were or are filed with the
Commission under the Securities Act or the
Exchange Act, as the case may be,
conformed or will conform in all material
respects with the requirements of the
Securities Act and the Exchange Act, as
applicable.
(d) The
Prospectus delivered to Stifel for use in connection with the
sale
of the Placement Shares pursuant to this
Agreement will be identical to the
versions of the Prospectus created to be
transmitted to the Commission for
filing via EDGAR, except to the extent
permitted by Regulation S-T.
(e) (i) As
described in the Prospectus, the Company is and will be the
sole general partner of, and does and will
(before taking into account of any
conversion of outstanding units in the
Operating Partnership (the "UNITS") for
Common Shares or exercises of outstanding
convertible securities of the Company
or the Operating Partnership during the
term of this Agreement) own a
substantial majority of the partnership
interests in the Operating Partnership,
(ii) except as described in the Prospectus,
the Operating Partnership does and
will directly, indirectly or through
co-investment joint ventures own each of
the multi-family apartment communities (the
"PROPERTIES") defined in the
Prospectus as "THE COMMUNITIES" (except for
Downtown Austin which is subject to
a ground lease (the "GROUND LEASE")), (iii)
the Operating Partnership is and
will be the sole general partner (except in
the case of co-investment joint
ventures which constitute general
partnerships) or managing member of each of
the co-investment joint ventures (the
"CO-INVESTMENT JOINT VENTURES") which own
the Co-Investment Communities as described
in the Prospectus, (iv) except as may
be otherwise set forth in the Prospectus,
the Operating Partnership does and
will own (A) 100% of the capital stock of
AIA, (B) 100% of the preferred stock
of the Management Company and (C) 1,000 of
the 1,056
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outstanding shares of common stock of the
Management Company, and the Management
Company does own and will own 100% of the
membership interests in Amrescon and
(v) the Operating Partnership does and will
own certain parcels of land
described in the Prospectus upon which it
intends to commence development (the
"LAND PARCELS"). For purposes of this
Agreement, the Service Companies and the
Co-Investment Joint Ventures are
collectively referred to as the "SUBSIDIARIES."
(f) 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, has the power and authority to
own its property and to conduct its
business as described in the Prospectus and
is duly qualified to do business and
is in good standing as a foreign
corporation in each jurisdiction in which its
ownership or leasing of property or assets
or the conduct of its business
requires such qualification, except where
the failure to so qualify would not
have a material adverse effect on the
business, assets, properties, prospects,
financial condition, or results of
operations of the Company, the Operating
Partnership, and the Subsidiaries taken as
a whole (a "MATERIAL ADVERSE EFFECT")
and has full trust power and authority
necessary to own, hold, lease and/or
operate its assets and properties, to
conduct the business in which it is
engaged and as described in the
Registration Statement and the Prospectus and to
enter into and perform its obligations
under this Agreement and to consummate
the transactions contemplated hereby, and
the Company is in compliance in all
material respects with the laws, orders,
rules, regulations and directives
issued or administered by any jurisdictions
in which it owns or leases property
or conducts business.
(g) Each
of the Service Companies has been duly incorporated, is validly
existing as a corporation or limited
liability company in good standing under
the laws of the jurisdiction of its
incorporation, has the corporate or limited
liability company power and authority to
own its property and to conduct its
business as described in the Prospectus and
is duly qualified to transact
business and is in good standing in each
jurisdiction in which the conduct of
its business or its ownership or leasing of
property requires such
qualification, except to the extent that
the failure to be so qualified or be in
good standing would not have a Material
Adverse Effect. All of the issued shares
of capital stock of each of AIA and the
Management Company have been duly and
validly authorized and issued, are fully
paid and non-assessable, free and clear
of all liens, encumbrances, equities or
claims.
(h) The Operating
Partnership has been duly formed and is validly existing
as a limited partnership in good standing
under the laws of the jurisdiction of
its formation, has the partnership power
and authority to own its property and
to conduct its business as described in the
Prospectus and is duly qualified to
transact business and is in good standing
in each jurisdiction in which the
conduct of its business or its ownership or
leasing of property requires such
qualification, except to the extent that
the failure to be so qualified or be in
good standing would not have a Material
Adverse Effect. The Operating
Partnership and the other subsidiaries
identified in the Registration Statement
are the only subsidiaries of the Company
required to be identified as such in
the Company's Annual Report on Form 10-K
pursuant to Item 601 of Regulation S-K.
(i) Each
Co-Investment Joint Venture has been duly formed and is validly
existing as a limited or general
partnership or limited liability company, as
the case may be, in good standing (in the
case of each limited partnership or
limited liability company) under the laws
of the
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jurisdiction of its formation, has the
partnership power and authority to own
its property and to conduct its business as
described in the Prospectus and is
duly qualified to transact business and is
in good standing in each jurisdiction
in which the conduct of its business or its
ownership or leasing of property
requires such qualification, except to the
extent that the failure to be so
qualified or be in good standing would not
have a Material Adverse Effect. As of
the Closing Date or any Option Closing
Date, as applicable, all of the
partnership or limited liability company
interests of each Co-Investment Joint
Venture will be duly authorized for
issuance and validly issued and fully paid,
in each case free and clear of any security
interest, mortgage, pledge, lien,
encumbrance, claim or equity. Each
partnership agreement relating to a
Co-Investment Joint Venture is in full
force and effect.
(j) This
Agreement has been duly authorized, executed and delivered by
the
Company and the Operating Partnership.
(k) The
execution and delivery by the Company and the Operating
Partnership of, and the performance by each
of the Company and the Operating
Partnership of its obligations under, this
Agreement will not contravene any
provision of applicable law or the
declaration of trust or by-laws of the
Company or the partnership agreement of the
Operating Partnership or any
agreement or other instrument binding upon
the Company, the Operating
Partnership and the Subsidiaries that is
material to the Company, the Operating
Partnership and the Subsidiaries, taken as
a whole, or any judgment, order or
decree of any governmental body, agency or
court having jurisdiction over the
Company, the Operating Partnership or any
Subsidiary, and no consent, approval,
authorization or order of, or qualification
with, any governmental body or
agency is required for the performance by
either of the Company or the Operating
Partnership of its obligations under this
Agreement, except such as may be
required by the securities or Blue Sky laws
of the various states in connection
with the offer and sale of the Shares.
(l) There
has not occurred any material adverse change, or any
development
involving a prospective material adverse
change, in the condition, financial or
otherwise, or in the earnings, business or
operations of the Company, the
Operating Partnership and the Subsidiaries,
taken as a whole, from that set
forth in the Prospectus.
(m) As of
December 31, 2004, the Company had an authorized, issued and
outstanding capitalization as set forth in
its statements of financial condition
included in the Company's most recent
Annual Report on Form 10-K. All of the
issued and outstanding shares of beneficial
interest of the Company have been
duly and validly authorized and issued and
are fully paid and nonassessable,
have been issued in compliance with all
federal and state securities laws and
were not issued in violation of any
preemptive right, resale right, right of
first refusal or similar right.
(n) The
shares of beneficial interest of the Company, including the
Placement Shares, conforms in all material
respects to the description thereof
contained in the Registration Statement and
the Prospectus and such description
conforms to the rights set forth in the
instruments defining the same. The
certificates for the Placement Shares are
in due and proper form.
(o) The
Placement Shares have been duly and validly authorized by the
Company for issuance and sale pursuant to
this Agreement and, when issued and
delivered against payment therefor as
provided herein, will be duly and validly
issued and fully paid and nonassessable,
free
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and clear of any pledge, lien, encumbrance,
security interest or other claim,
including any statutory or contractual
preemptive rights, resale rights, rights
of first refusal or other similar rights,
and will be registered pursuant to
Section 12 of the Exchange Act.
(p) Except
as set forth in the Registration Statement and the Prospectus,
(i) no person, as such term is defined in
Rule 1-02 of Regulation S-X
promulgated under the Securities Act (each,
a "PERSON"), has the right,
contractual or otherwise, to cause the
Company to issue or sell to such Person
any Common Shares or any other shares of
beneficial interest or other securities
of the Company, (ii) no Person has any
preemptive rights, resale rights, rights
of first refusal, or any other rights
(whether pursuant to a "poison pill"
provision or otherwise) to purchase any
Common Shares or any other shares of
beneficial interest or other securities of
the Company, (iii) except as pursuant
to an agreement with Cantor Fitzgerald
& Co., no Person has the right to act as
an underwriter or as a financial advisor to
the Company in connection with the
offer and sale of the Common Shares, in the
case of each of the foregoing
clauses (i), (ii) and (iii), whether as a
result of the filing or effectiveness
of the Registration Statement or the sale
of the Placement Shares as
contemplated hereby or otherwise, and (iv)
no Person has the right, contractual
or otherwise, to require the Company to
include any Common Shares or any other
shares of beneficial interest or other
securities of the Company in the
Registration Statement or the offering
contemplated thereby, as a result of the
filing or effectiveness of the Registration
Statement.
(q) KPMG
LLP, who have audited certain financial statements of the
Company
and its subsidiaries, are independent
registered public accountants with respect
to the Company within the meaning of the
Securities Act and the Public Company
Accounting Oversight Board (United
States).
(r) Since
the effective date on April 22, 2005 of the registration
statement filed pursuant to the Securities
Act, the Company has timely filed
with the Commission all documents and other
material required to be filed
pursuant to Sections 13, 14 and 15(d) under
the Exchange Act. As of the date of
this Agreement, the aggregate market value
of the Company's voting stock held by
nonaffiliates of the Company was equal to
or greater than $150 million.
(s) The
Common Shares are an "actively-traded security" excepted from
the
requirements of Rule 101 of Regulation M
under the Exchange Act by subsection
(c)(1) of such rule.
(t)
Subsequent to the respective dates as of which information is
given
in, or incorporated by reference into, the
Registration Statement and the
Prospectus, there has not been (i) any
material adverse change, or any
development that is likely to cause a
Material Adverse Change, (ii) any
transaction that is material to the Company
and the Subsidiaries taken as a
whole, except transactions in the ordinary
course of business consistent with
past practices, or as described in the
Registration Statement and the
Prospectus, (iii) any obligation, direct or
contingent (including off-balance
sheet obligations), that is material to the
Company and the Subsidiaries taken
as a whole, except transactions in the
ordinary course of business consistent
with past practices or as described in the
Registration Statement and the
Prospectus, or (iv) any change in the
number of authorized shares of beneficial
interest or, except for obligations
incurred in the ordinary course of business,
outstanding indebtedness of the Company.
The
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Company has no material contingent
obligation (including off-balance sheet
obligations) that is not disclosed in the
Registration Statement or the
Prospectus.
(u) The
Company has not defaulted on any installment on indebtedness
for
borrowed money or on any rental on one or
more long-term leases, which defaults
could reasonably be expected to have a
Material Adverse Effect. The Company has
not filed a report pursuant to Section
13(a) or 15(d) of the Exchange Act since
the filing of its most recent Annual Report
on Form 10-K, indicating that it (i)
has failed to pay any dividend or sinking
fund installment on preferred stock or
(ii) has defaulted on any installment on
indebtedness for borrowed money or on
any rental on one or more long-term leases,
which defaults could reasonably be
expected to have a Material Adverse
Effect.
(v) At the
time of purchase, the Placement Shares will be approved for
listing on the Exchange, subject to
official notice of issuance, or the Company
will have filed an application for listing
of the Shares on the Exchange. The
Company has taken no action designed to, or
likely to have the effect of,
terminating the registration of the Common
Shares under the Exchange Act or the
listing of the Common Shares on the NYSE,
nor has the Company received any
notification that the Commission or the
NYSE is contemplating terminating such
registration or listing.
(w)
Neither the Company nor any of its affiliates (i) is required
to
register as a "broker" or "dealer" in
accordance with the provisions of the
Exchange Act or (ii) directly or indirectly
through one or more intermediaries,
controls or has any other association with
(within the meaning of Article I of
the Bylaws of the National Association of
Securities Dealers, Inc. ("NASD")) any
member firm of the NASD.
(x) The
Company has not relied upon Stifel or legal counsel for Stifel
for
any legal, tax or accounting advice in
connection with the offering and sale of
the Placement Shares.
(y) On
each Representation Date (as defined in Section 7(m) below),
the
Company shall be deemed to have confirmed
(i) the accuracy and completeness, as
of such date, of each representation and
warranty made by it in this Agreement
except for the representations and
warranties that speak solely to a specific
date which shall be true and correct as of
such date; and (ii) that the Company
has complied with all of the agreements to
be performed by it hereunder at or
prior to such date.
(z) Any
certificate signed by any officer of the Company delivered to
Stifel or to counsel for Stifel pursuant to
or in connection with this Agreement
shall be deemed a representation and
warranty by the Company to Stifel as to the
matters covered thereby.
(aa) The
Company has not incurred any liability for any finder's fees or
similar payments in connection with the
transactions herein contemplated, except
as may otherwise exist with respect to
Stifel pursuant to this Agreement.
(bb) None
of the Company or, to the Company's knowledge, the Operating
Partnership, any Subsidiary or any employee
or agent of the Company or any
Subsidiary, has made any payment of funds
or received or retained any funds in
violation of any law, rule or regulation or
of a character required to be
disclosed in the Prospectus. No
relationship, direct or indirect, exists
9
<PAGE>
between or among the Company or, to the
Company's knowledge, the Operating
Partnership, any Subsidiary or any
affiliate of any of them, on the one hand,
and the directors, officers and
stockholders of the Company or, to the Company's
knowledge, any Subsidiary, on the other
hand, that is required by the Securities
Act to be described in the Registration
Statement and the Prospectus that is not
so described.
(cc)
Neither the Company nor the Operating Partnership is, after
giving
effect to the offering and sale of the
Placement Shares, will be an "investment
company" or an entity "controlled" by an
"investment company," as such terms are
defined in the Investment Company Act of
1940, as amended (the "INVESTMENT
COMPANY ACT").
(dd) No
relationship, direct or indirect, exists between or among the
Company, the Operating Partnership or any
Subsidiary or any affiliate of them,
on the one hand, and the directors,
officers, stockholders or directors of the
Company, the Operating Partnership, or any
Subsidiary, on the other hand, that
is required by the rules of the NASD to be
described in the Registration
Statement and the Prospectus that is not so
described. Except as otherwise
disclosed in the Prospectus, there are no
material outstanding loans or advances
or material guarantees of indebtedness by
the Company or, to the Company's
knowledge, any Subsidiary or any affiliate
of them to or for the benefit of any
of the officers or directors of the Company
or any Subsidiary or any of the
members of the families of any of them.
(ee) The
Company is in compliance with all presently applicable
provisions
of the Sarbanes-Oxley Act of 2002 (the
"SARBANES-OXLEY ACT") and is actively
taking steps to ensure that it will be in
compliance with other applicable
provisions of the Sarbanes-Oxley Act upon
the effectiveness of such provisions.
(ff) The
Company has retained KPMG as its independent registered public
accountants.
(gg) The
Company is not a party to any agreement with an agent or
underwriter for any other "at-the-market"
or continuous equity transaction other
than the Sales Agreement of even date
herewith entered into with Cantor
Fitzgerald &Co.
(hh) The
Company acknowledges and agrees that Stifel has informed the
Company that Stifel may, to the extent
permitted under the Securities Act and
the Exchange Act, purchase and sell Common
Shares for its own account while this
Agreement is in effect provided that (i) no
such purchase or sales shall take
place while a Placement Notice is in effect
(except to the extent Stifel may
engage in sales of Placement Shares
purchased or deemed purchased from the
Company as a "riskless principal" or in a
similar capacity) and (ii) the Company
shall not be deemed to have authorized or
consented to any such purchases or
sales by Stifel.
(ii) Since
the respective dates as of which information is given in the
Registration Statement and the Prospectus,
except as otherwise stated therein,
(A) there have been no transactions entered
into by the Company, the Operating
Partnership or any of the Subsidiaries,
other than those in the ordinary course
of business, which are material with
respect to the Properties (taken as a
whole) or to the Company, (B) there has
been no casualty loss or condemnation or
other adverse event with respect to any
Property that is material with respect
to the Properties (taken as a whole), (C)
there has been no dividend or
distribution of any kind declared, paid or
made by the Company or the Service
Companies on any class of their shares
of
10
<PAGE>
beneficial interest or by the Operating
Partnership or any Co-Investment Joint
Venture with respect to their partnership
interests, and (D) there has been no
change in the shares of beneficial interest
or capital stock of the Company or
the Service Companies or in the partnership
interests of the Operating
Partnership or any Co- Investment Joint
Venture, or any material increase in the
indebtedness of the Company, the Operating
Partnership or any of the
Subsidiaries, taken as a whole.
(jj) There
are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened to
which the Company or any of its
subsidiaries is a party or to which any of
the properties of the Company or any
of its subsidiaries is subject that are
required to be described in the
Registration Statement or the Prospectus
and are not so described or any
statutes, regulations, contracts or other
documents that are required to be
described in the Registration Statement or
the Prospectus or to be filed as
exhibits to the Registration Statement that
are not described or filed as
required.
(kk) The
Company, the Operating Partnership and the Subsidiaries own or
have a royalty-free license to use all of
the trademarks, service marks and
trade names (collectively, the "PROPRIETARY
RIGHTS") presently employed by them
in connection with the business now engaged
by them or proposed to be engaged by
them as described in the Prospectus, and
neither the Company, the Operating
Partnership nor the Subsidiaries have
received any notice or are otherwise aware
of any infringement of or conflict with
asserted rights of others with respect
to any Proprietary Rights, or of any facts
which would render any of the
Proprietary Rights invalid or inadequate to
protect the interest of the Company,
the Operating Partnership or any of the
Subsidiaries therein, and which
infringement or conflict (if the subject of
any unfavorable decision, ruling or
finding) or invalidity or inadequacy,
individually or in the aggregate, would
have a Material Adverse Effect.
(ll) Each
of the Company, the Operating Partnership and the Subsidiaries
possesses such certificates, authorizations
or permits issued by the appropriate
state, Federal or foreign regulatory
agencies or bodies necessary to conduct the
business now operated by them or proposed
to be operated by them as described in
the Prospectus, and none of such entities
has received any notice of proceedings
relating to the revocation or modification
of any such certificate,
authorization or permit which, individually
or in the aggregate, if the subject
of an unfavorable decision, ruling or
finding, would have a Material Adverse
Effect.
(mm) Each
of the Company, the Operating Partnership and the Subsidiaries
(i) are in compliance with any and all
applicable foreign, Federal, state and
local laws and regulations relating to the
protection of human health and
safety, the environment or hazardous or
toxic substances or wastes, pollutants
or contaminants ("ENVIRONMENTAL LAWS"),
(ii) have received all permits, licenses
or other approvals required of them under
applicable Environmental Laws to
conduct their respective businesses and
(iii) are in compliance with all terms
and conditions of any such permit, license
or approval, except where such
noncompliance with Environmental Laws,
failure to receive required permits,
licenses or other approvals or failure to
comply with the terms and conditions
of such permits, licenses or approvals
would not, singly or in the aggregate,
have a Material Adverse Effect.
(nn)
Neither the Company nor the Operating Partnership has knowledge
of
(a) the presence of any hazardous
substances, hazardous materials, toxic
substances or waste materials
11
<PAGE>
(collectively, "HAZARDOUS MATERIALS") on
any of the properties owned by it or
any Subsidiaries in violation of law or in
excess of regulatory action levels or
(b) any unlawful spills, releases,
discharges or disposal of Hazardous Materials
that have occurred or are presently
occurring on or off such properties as a
result of any construction on or operation
and use of such properties, which
presence or occurrence would have a
Materially Adverse Effect; and in connection
with the construction on or operation and
use of the properties owned by the
Company, the Operating Partnership or the
Subsidiaries, none has any knowledge
of any material failure to comply with all
applicable local, state and Federal
environmental laws, regulations, agency
requirements, ordinances and
administrative and judicial orders.
(oo) There
are no costs or liabilities associated with Environmental Laws
(including, without limitation, any capital
or operating expenditures required
for clean-up, closure of properties or
compliance with Environmental Laws or any
permit, license or approval, any related
constraints on operating activities and
any potential liabilities to third parties)
which would, singly or in the
aggregate, have a Material Adverse
Effect.
(pp) There
are no contracts, agreements or understandings between the
Company and any person granting 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 or to require the
Company to include such securities
with the Shares registered pursuant to the
Registration Statement.
(qq)
Except as disclosed in the Prospectus, or except to the extent
that
the inaccuracy of any of the following,
either individually or in the aggregate,
would not have a Material Adverse Effect:
(A) the Operating Partnership or the
Co-Investment Joint Ventures (other than
with respect to the Ground Lease) will
have good and marketable fee simple title
(or, with respect to Properties
located in Texas, good and indefeasible
title) to the land underlying each of
the Properties and good and marketable
title to the improvements thereon (in
each case with title insurance thereon in
full force and effect and which is
adequate in accordance with industry
standards) and all other assets that are
required for the effective operation of
such Properties in the manner in which
they currently are operated subject only to
Permitted Exceptions (as hereinafter
defined); (B) the leases under which the
Company, the Operating Partnership or
the Subsidiaries will lease any property as
lessee will be in full force and
effect, and neither the Company, the
Operating Partnership nor any Subsidiary
will be in default in any material respect
of any of the terms or provisions of
any of such leases and no claim has been
asserted by anyone adverse to any such
entity's rights as lessee under any of such
leases, or affecting or questioning
any such entity's right to the continued
possession or use of the properties
under any such leases or asserting a
default under any such leases; (C) all
liens, charges or encumbrances on or
affecting any of the Properties or the
other property and assets of the Company,
the Operating Partnership or any of
the Subsidiaries which are required to be
disclosed in the Prospectus are
disclosed therein; (D) neither the Company,
the Operating Partnership, any Co-
Investment Joint Venture nor, to the
knowledge of the Company, the Operating
Partnership or the Subsidiaries, any tenant
of any of the Properties is in
default under any of the leases pursuant to
which the Operating Partnership or
any Co-Investment Joint Venture, as lessor,
will lease its Property and none of
the Company, the Operating Partnership or
any of the Subsidiaries knows of any
event which, but for the passage of time or
the giving of notice, or both, would
constitute a default under any of such
leases; (E) the Operating Partnership or
the Co-Investment Joint Ventures (or the
Management Company as agent for the
Co-Investment Joint Ventures or the
Operating
12
<PAGE>
Partnership) will be the lessor of all
tenant leases at each of the Properties;
(F) each of the Properties complies with
all applicable Federal, state and local
codes, laws and regulations including,
without limitation, building and zoning
codes, laws and regulations and laws
relating to handicapped access to the
Properties); (G) none of the Company, the
Operating Partnership or any of the
Subsidiaries has knowledge of any pending
or threatened condemnation
proceedings, zoning change, or other
proceeding or action that will in any
manner adversely affect the size of, use
of, improvements on, construction on or
access to the Properties; and (H) neither
the Company, the Operating Partnership
nor any of the Subsidiaries has received
from any governmental authority notice
of any violation of any municipal, state or
Federal law, rule or regulation
(including relating to environmental
matters) concerning the Properties or any
part thereof which has not heretofore been
cured. As used in this Agreement,
"PERMITTED EXCEPTIONS" means: (i) real
estate taxes and assessments not yet
delinquent; (ii) covenants, restrictions,
easements and other similar
agreements, provided that the same are not
violated by existing improvements or
the current use and operation of a
Property; (iii) zoning laws, ordinances and
regulations, building codes, rules and
other governmental laws, regulations,
rules and orders affecting each Property,
provided that the same are not
violated by existing improvements or the
current use and operation of a
Property; (iv) any state of facts disclosed
by the surveys relating to the
Properties; (v) any minor imperfection of
title which does not affect the
current use, operation or enjoyment of a
Property and does not render title to
such Property unmarketable or uninsurable
and does not impair the value of such
Property; and (vi) mortgage financing as
described in the Prospectus.
(rr) (A)
Except as set forth in the Prospectus, no person or entity will
have an option or right of first refusal
(except for buy sell or similar
provisions, in the case of the
Co-Investment Joint Ventures, as set forth in the
partnership or limited liability company
agreements of the partnerships or
limited liability companies that own the
Co-Investment Joint Ventures) to
purchase all or any part of any Property or
any interest therein; and (B) there
is in effect for the Properties and other
assets of the Company, the Operating
Partnership and the Subsidiaries insurance
coverages including title insurance)
that are commercially reasonable and
adequate for the types of assets and
properties owned, operated or managed by
them, and neither the Company, the
Operating Partnership, nor any Subsidiary
has received from any insurance
company notice of any material defects or
deficiencies affecting the
insurability of any of the Properties or
such other assets.
(ss) The
statements set forth in the Registration Statement under the
captions "Description of Common Shares",
"Description of Preferred Shares", "
Description of Securities Warrants",
"Description of Provisions of Maryland Law
and Our Declaration of Trust and Bylaws"
and "Plan of Distribution" are, and the
statements made in the Prospectus as
amended or supplemented under corresponding
or similar captions to the extent made are,
insofar as such statements
constitute a summary of the terms of the
Securities and the laws and documents
referred to therein, are accurate and
complete in all material respects.
(tt)
Commencing with its taxable year ended December 31, 1994, the
Company
has been, and upon the sale of the
Placement Shares, the Company will continue
to be, organized and operated in conformity
with the requirements for
qualification and taxation as a real estate
investment trust (a "REIT") under
the Internal Revenue Code of 1986, as
amended (the "CODE"), and the Company's
proposed method of operation as described
in the Prospectus will
13
<PAGE>
enable it to continue to meet the
requirements for qualification and taxation as
a REIT under the Code, and no actions have
been taken (or not taken which are
required to be taken) which would cause
such qualification to be lost.
(uu) The
financial statements of the Company (including all notes and
schedules thereto) included or incorporated
by reference in the Registration
Statement and Prospectus present fairly the
financial position, the results of
operations, the statements of cash flows
and the statements of shareholders'
equity and the other information purported
to be shown therein of the Company at
the respective dates and for the respective
periods to which they apply. Such
financial statements and related schedules
and notes have been prepared in
conformity with United States generally
accepted accounting principles,
consistently applied throughout the periods
involved, and all adjustments
necessary for a fair presentation of the
results for such periods have been
made.
(vv)
Neither the Company, nor to its knowledge, any of its officers,
directors or affiliates has taken, or will
take, directly or indirectly, any
action designed to or which might
reasonably be expected to cause or result in,
or which has constituted or which might
reasonably be expected to constitute,
the stabilization or manipulation of the
price of the Placement Shares or any
security convertible into or exchangeable
for Placement Shares to facilitate the
sale or resale of any of the Placement
Shares.
(ww) The
Company, the Operating Partnership, and each of the
Subsidiaries
have timely and duly filed all material Tax
Returns required to be filed by
them, and all such Tax Returns are true,
correct and complete in all material
respects. The Company, the Operating
Partnership, and each of the Subsidiaries
have timely and duly paid in full all
material Taxes required to be paid by them
whether or not such amounts are shown as
due on any Tax
