Exhibit
1.1
SENIOR HOUSING PROPERTIES
TRUST
5,000,000 Shares of Beneficial
Interest
($0.01 par value per
Share)
UNDERWRITING AGREEMENT
November 14, 2006
UNDERWRITING AGREEMENT
November 14, 2006
UBS Securities
LLC
Merrill Lynch,
Pierce, Fenner & Smith
Incorporated
Morgan Stanley
& Co. Incorporated
RBC Capital
Markets Corporation
Wachovia
Capital Markets, LLC
Ferris, Baker
Watts, Incorporated
Janney
Montgomery Scott LLC
Morgan Keegan
& Company, Inc.
Oppenheimer
& Co. Inc.
Raymond James
and Associates, Inc.
Stifel,
Nicolaus & Company, Incorporated
As
Managing Underwriters
c/o UBS
Securities LLC
299 Park
Avenue
New York, New
York 10171-0026
c/o Merrill
Lynch, Pierce, Fenner & Smith
Incorporated
4 World
Financial Center, 16th floor
New York, NY
10080
Ladies and
Gentlemen:
Senior Housing Properties Trust, a real estate
investment trust organized under the laws of the State of Maryland
(the “Company”), proposes to issue and sell to the
underwriters named in Schedule A annexed hereto (the
“Underwriters”) an aggregate of 5,000,000 common shares
(the “Firm Shares”) of beneficial interest, $0.01 par
value (the “Common Shares”) of the Company. In
addition, solely for the purpose of covering over-allotments, the
Company proposes to grant to the Underwriters the option to
purchase up to an additional 750,000 Common Shares (the
“Additional Shares”). The Firm Shares and the
Additional Shares are hereinafter collectively sometimes referred
to as the “Shares.” The Shares are described in the
Prospectus which is referred to below.
The Company has prepared and filed with the
Securities and Exchange Commission (the “Commission”),
in accordance with the provisions of the Securities Act of 1933, as
amended, and the rules and regulations of the Commission thereunder
(collectively, the “Act”), a registration statement
(File No. 333-135716) on Form S-3 under the Act (the “shelf
registration statement”), including a prospectus relating to,
among other things, Common Shares, preferred shares of beneficial
interest, depository
shares,
guarantees, debt securities and warrants for such securities of the
Company, and such amendments to such registration statement, as may
have been required prior to the date hereof, have been similarly
prepared and have been filed with the Commission. Such shelf
registration statement, as so amended, and any post-effective
amendments thereto, have become effective under the Act.
The Company will next file with the Commission
pursuant to Rule 424(b) under the Act a final prospectus supplement
to the basic prospectus included in the shelf registration
statement, as so amended, describing the Shares and the offering
thereof, in such form as has been provided to or discussed with,
and approved by, the Underwriters.
Except where the context otherwise requires, the
term “Registration Statement” as used in this Agreement
means the shelf registration statement, as amended at the time it
became effective for purposes of Section 11 of the Act, as such
section applies to the respective Underwriters (the
“Effective Time”), including (i) all documents filed as
part thereof or incorporated by reference or deemed to be
incorporated by reference therein and (ii) any information
contained or incorporated by reference in a prospectus filed with
the Commission pursuant to Rule 424(b) under the Act, to the extent
such information is deemed, pursuant to Rule 430A, Rule 430B or
Rule 430C under the Act, to be part of the registration statement
at the Effective Time. If an abbreviated registration statement is
prepared and filed with the Commission in accordance with Rule
462(b) under the Act (an “Abbreviated Registration
Statement”), the term “Registration Statement”
includes the Abbreviated Registration Statement. Any such
Abbreviated Registration Statement shall be filed by the Company
with the Commission and become effective no later than 10:00 P.M.,
New York City time, on the date of determination of the public
offering price for the Shares.
Except where the context otherwise requires, the
term “Basic Prospectus” as used in this Agreement means
the prospectus dated July 12, 2006, as filed with the Commission
pursuant to Rule 424(b) and included in the shelf registration
statement. Except where the context otherwise requires, the term
“Prepricing Prospectus” as used in this Agreement means
each preliminary form of the Prospectus (as defined herein) subject
to completion, if any, used in connection with the offering of the
Shares. Except where the context otherwise requires, the term
“Prospectus Supplement” as used in this Agreement means
any final prospectus supplement specifically relating to the
Shares, in the form filed with, or transmitted for filing to, the
Commission pursuant to Rule 424 under the Act. Except where the
context otherwise requires, the term “Prospectus” as
used in this Agreement means the Basic Prospectus together with the
Prospectus Supplement, except that if such Basic Prospectus is
amended or supplemented on or prior to the date on which the
Prospectus Supplement was first filed pursuant to Rule 424, the
term “Prospectus” shall refer to the Basic Prospectus
as so amended or supplemented and as supplemented by the Prospectus
Supplement.
“Permitted Free Writing
Prospectuses,” as used herein, means the documents listed on
Schedule B attached hereto and each “road show” (as
defined in Rule 433 under the Act), if any, related to the offering
of the Shares contemplated hereby
that is a
“written communication” (as defined in Rule 405 under
the Act) (each such road show, a “Road
Show”).
“Disclosure Package,” as used
herein, means the Basic Prospectus, including without limitation
the documents incorporated by reference therein as of the time this
agreement is entered into, together with any Prepricing Prospectus
and any combination of one or more of the Permitted Free Writing
Prospectuses, if any.
Any reference in this Agreement to the shelf
registration statement, the Registration Statement, the Basic
Prospectus, any Prepricing Prospectus, any Prospectus Supplement,
the Prospectus or any Permitted Free Writing Prospectus shall be
deemed to refer to and include the documents incorporated by
reference therein (the “Incorporated Documents”),
including, unless the context otherwise requires, the documents, if
any, filed as exhibits to such Incorporated Documents. Any
reference in this Agreement to the term “amend,”
“amendment” or “supplement” with respect to
the shelf registration statement, the Registration Statement, the
Basic Prospectus, any Prepricing Prospectus, any Prospectus
Supplement, any Prospectus or any Permitted Free Writing Prospectus
shall be deemed to refer to and include any documents filed under
the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), on or after the initial effective date
of the Registration Statement, or the date of such Basic
Prospectus, such Prepricing Prospectus, the Prospectus Supplement,
the Prospectus or such Permitted Free Writing Prospectus, as the
case may be, and deemed to be incorporated therein by
reference.
The Company and the Underwriters agree as
follows:
1. Sale and Purchase . Upon the basis of the representations and
warranties and subject to the terms and conditions herein set
forth, the Company agrees to issue and sell to each Underwriter,
and, upon the basis of the representations, warranties and
agreements of the Company herein contained and subject to all the
terms and conditions set forth herein, each Underwriter agrees,
severally and not jointly, to purchase from the Company the number
of Firm Shares set forth opposite the name of such Underwriter in
Schedule A attached hereto (subject to adjustment in accordance
with Section 9 hereof) at a purchase price of $21.04per share (the
“Purchase Price Per Share”).
The Company is advised by you that the
Underwriters intend (i) to make a public offering of their
respective portions of the Firm Shares as soon after the date
hereof as in your judgment is advisable and (ii) initially to offer
the Firm Shares upon the terms set forth in the Prospectus. You may
from time to time increase or decrease the public offering price
after the initial public offering to such extent as you may
determine.
In addition, the Company hereby grants to the
several Underwriters the option to purchase, and upon the basis of
the representations, warranties and agreements of the Company and
subject to all the terms and conditions herein set forth, the
Underwriters shall have the right to purchase, severally and not
jointly, from the Company, ratably in accordance with the number of
Firm Shares to be purchased by each of them (subject to such
adjustment as you shall determine to avoid fractional shares),
all
or a portion of
the Additional Shares as may be necessary to cover over-allotments
made in connection with the offering of the Firm Shares, at the
Purchase Price Per Share. This option may be exercised by you
on behalf of the several Underwriters at any time on or before the
thirtieth day following the date hereof, by written notice to the
Company. Such notice shall set forth the aggregate number of
Additional Shares as to which the option is being exercised, and
the date and time when the Additional Shares are to be delivered
(such date and time being herein referred to as the
“additional time of purchase”); provided ,
however , that the additional time of purchase shall not be
earlier than the time of purchase (as defined below) nor earlier
than the second business day after the date on which the option
shall have been exercised nor later than the tenth business day
after the date on which the option shall have been exercised.
The number of Additional Shares to be sold to each Underwriter
shall be the number which bears the same proportion to the
aggregate number of Additional Shares being purchased as the number
of Firm Shares set forth opposite the name of such Underwriter on
Schedule A hereto bears to the total number of Firm Shares
(subject, in each case, to such adjustment as you may determine to
eliminate fractional shares).
As used herein, “business day” shall
mean a day on which the New York Stock Exchange (the
“NYSE”) is open for trading.
2. Payment and Delivery . Payment of the purchase price for the Firm
Shares shall be made to the Company by Federal Funds wire transfer,
against delivery of the Firm Shares to you through the facilities
of the Depository Trust Company (“DTC”) for the
respective accounts of the Underwriters. Such payment and delivery
shall be made at 10:00 A.M., New York City time, on November 17,
2006 (unless another time shall be agreed to by you or unless
postponed in accordance with the provisions of Section 9 hereof).
The time at which such payment and delivery are actually made is
hereinafter sometimes called the “time of purchase.”
Certificates, if any, for the Firm Shares shall be delivered to you
in definitive form in such names and in such denominations as you
shall specify no later than the second business day preceding the
time of purchase. For the purpose of expediting the checking of the
certificates for the Firm Shares by you, the Company agrees to make
such certificates available to you for such purpose at least one
full business day preceding the time of purchase.
Payment of the purchase price for the Additional
Shares shall be made at the additional time of purchase in the same
manner and at the same office as the payment for the Firm
Shares. Certificates, if any, for the Additional Shares shall
be delivered to you in definitive form in such names and in such
denominations as you shall specify no later than the second
business day preceding the additional time of purchase. For
the purpose of expediting the checking of the certificates for the
Additional Shares by you, the Company agrees to make such
certificates available to you for such purpose at least one full
business day preceding the additional time of purchase.
Deliveries of the documents described in Section
7 hereof with respect to the purchase of the Shares shall be made
at 9:00 A.M. at such location(s) as shall be agreed upon by you and
the Company on the date of the closing of the purchase of the Firm
Shares or the Additional Shares, as the case may be.
3. Representations and Warranties of the
Company . The Company
represents and warrants to and agrees with each of the Underwriters
that:
(a) no order preventing or suspending the use of
the Basic Prospectus, any Prepricing Prospectus, the Prospectus
Supplement, the Prospectus or any Permitted Free Writing Prospectus
is in effect and no proceedings for such purpose are pending or, to
the knowledge of the Company, threatened by the Commission or the
securities authority of any state or other jurisdiction. The
Registration Statement has become effective under the Act; no stop
order suspending the effectiveness of the Registration Statement is
in effect, and no proceedings for such purpose are pending before
or, to the knowledge of the Company, threatened by the Commission
or the securities authority of any state or other
jurisdiction;
(b) (i) the Company is eligible to use Form S-3 and
the offering of the Shares complies and will comply with the
requirements of Rule 415 under the Act including, without
limitation, Rule 415(a)(5); (ii) each part of the Registration
Statement, and also any Abbreviated Registration Statement, when it
became effective, complied, or with respect to any part of the
Registration Statement or any Abbreviated Registration Statement
that has not yet become effective, will comply at the time of
effectiveness, and as of the date hereof and, as amended or
supplemented, at the time of purchase and at all times during which
a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any
similar rule) in connection with any sale of Shares, will comply,
in all material respects, with applicable requirements of the Act
and the Exchange Act; (iii) each part of the Registration Statement
did not, as of the Effective Time, contain any 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; (iv) each Prepricing Prospectus, if any, complied, at
the time it was filed with the Commission, and complies as of the
date hereof, in all material respects with the requirements of the
Act; (v) the Disclosure Package, as of the time of execution of
this Agreement, did not include an untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading; (vi) the Basic Prospectus
complied or will comply, at the time it was or will be filed with
the Commission, in all material respects with the requirements of
the Act; (vii) each of the Prospectus Supplement and the Prospectus
will comply, as of the date that it is filed with the Commission,
the date of the Prospectus Supplement, the time of purchase and at
all times during which a prospectus is required by the Act to be
delivered (whether physically or through compliance with Rule 172
under the Act or any similar rule) in connection with any sale of
Shares, in all material respects, with the requirements of the Act
(in the case of the Prospectus, including, without limitation,
Section 10(a) of the Act); (viii) at no time during the period that
begins on the earlier of the date of the Prospectus Supplement and
the date the Prospectus Supplement is filed with the Commission and
ends at the later of the time of purchase and the end of the period
during which a prospectus is required by the Act to be delivered
(whether physically or through compliance with Rule 172 under the
Act or any similar rule) in connection with any sale of Shares did
or will any Prospectus Supplement or the Prospectus, as then
amended or supplemented, include an untrue statement of a material
fact or omit to state a material
fact necessary
in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; (ix) at
no time during the period that begins on the date of such Permitted
Free Writing Prospectus and continues through the time of the
filing of the Prospectus with the Commission did or will any
Permitted Free Writing Prospectus include an untrue statement of a
material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that the
representations and warranties set forth in this paragraph (b) do
not apply to statements or omissions in the Registration Statement,
the Basic Prospectus, any Prepricing Prospectus, the Prospectus
Supplement, the Prospectus or any Permitted Free Writing Prospectus
based upon information relating to any Underwriter furnished to the
Company by such Underwriter through you expressly for use
therein;
(c) (i) the Company has not, directly or
indirectly, distributed and will not distribute any offering
material in connection with the offering or sale of the Shares
other than the Basic Prospectus, any Prepricing Prospectus, the
Permitted Free Writing Prospectuses, if any, and the Prospectus;
(ii) the Company has not, directly or indirectly, prepared, used or
referred to any Permitted Free Writing Prospectus except in
compliance with Rule 163 or with Rules 164 and 433 under the Act;
(iii) assuming that such Permitted Free Writing Prospectus is so
sent or given after the Registration Statement was filed with the
Commission (and after such Permitted Free Writing Prospectus was,
if required pursuant to Rule 433(d) under the Act, filed with the
Commission), the sending or giving, by any Underwriter, of any
Permitted Free Writing Prospectus will satisfy the provisions of
Rule 164 or Rule 433 (without reliance on subsections (b), (c) and
(d) of Rule 164), (iv) the conditions set forth in one or more of
subclauses (i) through (iv), inclusive, of Rule 433(b)(1) under the
Act are satisfied, (v) the Prepricing Prospectus is a prospectus
that, other than by reason of Rule 433 or Rule 431 under the Act,
satisfies the requirements of Section 10 of the Act, (vi) neither
the Company nor the Underwriters are disqualified, by reason of
subsection (f) or (g) of Rule 164 under the Act, from using, in
connection with the offer and sale of the Shares, “free
writing prospectuses” (as defined in Rule 405 under the Act)
pursuant to Rules 164 and 433 under the Act, (vii) the Company is
not an “ineligible issuer” (as defined in Rule 405
under the Act) as of the eligibility determination date for
purposes of Rules 164 and 433 under the Act with respect to the
offering of the Shares contemplated by the Registration Statement,
(viii) the parties hereto agree and understand that the content of
any and all “road shows” (as defined in Rule 433 under
the Act) related to the offering of the Shares contemplated hereby
is solely the property of the Company;
(d) the Incorporated Documents, when they were
filed with the Commission, complied in all material respects with
the requirements of the Exchange Act, and none of such documents,
when they were filed with the Commission, contained an untrue
statement of a material fact or omitted to state a material fact
necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in (i) the
Registration Statement, when such documents are filed with the
Commission, will conform in all material respects to the
requirements of the Exchange Act, as applicable, and will not
contain an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein
not
misleading, and
(ii) any Prepricing Prospectus, the Prospectus or any Permitted
Free Writing Prospectus, when such documents are filed with the
Commission, will conform in all material respects to the
requirements of the Exchange Act, as applicable, and will not
contain 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 in which they were made, not
misleading;
(e) as of the date of this Agreement, the Company
has, and as of the time of purchase the Company will have, an
authorized capitalization as set forth in the Registration
Statement, any Prepricing Prospectus and the Prospectus (and any
similar information, if any, contained in any Permitted Free
Writing Prospectus); as of the date of this Agreement the Company
has an outstanding capitalization as set forth in the Registration
Statement, any Prepricing Prospectus and the Prospectus and as of
the time of purchase there shall not have been any changes since
the date of this Agreement in the Company’s outstanding
capitalization, except for differences which are not material; all
of the issued and outstanding Common Shares of the Company have
been duly and validly authorized and issued and are fully paid and
non-assessable, have been issued in compliance with all federal and
state securities laws and were not issued in violation of any
preemptive or similar right;
(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, with trust power to own, lease
and operate its properties and conduct its business as described in
the Registration Statement, the Prepricing Prospectus, the
Prospectus and the Permitted Free Writing Prospectuses, if any, and
to execute and deliver this Agreement and to issue, sell and
deliver the Shares as contemplated herein;
(g) the Company is duly qualified and is in good
standing in each jurisdiction in which the ownership or leasing of
its properties or the conduct of its business requires such
qualification, except where the failure to so qualify in any such
jurisdiction would not individually or in the aggregate have a
material adverse effect on the business, prospects, properties,
condition (financial or otherwise) or results of operations of the
Company and the Subsidiaries (as defined herein), taken as a whole
(a “Material Adverse Effect”);
(h) The Company does not own, directly or
indirectly, any shares of stock or any other equity or long-term
debt of any other corporation or have any direct or indirect equity
interest or ownership of long-term debt in any firm, partnership,
joint venture, limited liability company, association or other
entity except for (i) the Company’s subsidiaries (as defined
in the Act) (the “Subsidiaries”) and (ii) the
Company’s ownership of 1,000,000 common shares of HRPT
Properties Trust and 35,000 common shares of Five Star Quality
Care, Inc. The Subsidiaries identified in Schedule C attached
hereto (each, a “Significant Subsidiary”) are the only
Subsidiaries of the Company that are significant subsidiaries (as
such term is defined by Rule 1-02(w) of Regulation S-X) of the
Company. Each Significant Subsidiary has been duly incorporated or
formed and is validly existing as a corporation or other entity, as
the case may be, in good standing under the laws of the
jurisdiction of its incorporation or
organization,
with the requisite corporate, trust, partnership or other power to
acquire and own, lease and operate its properties and to conduct
its business, as described in the Registration Statement, the
Prepricing Prospectus, the Prospectus and the Permitted Free
Writing Prospectuses, if any; and each Significant Subsidiary is
duly qualified and in good standing to do business in each
jurisdiction in which the nature of its business or the ownership
or leasing of the property requires such qualification, except
where the failure to be so qualified would not individually or in
the aggregate have a Material Adverse Effect. Each of the
Significant Subsidiaries is duly qualified and in good standing to
do business in the jurisdictions set forth below the name of such
Significant Subsidiary on Schedule D hereto, such jurisdictions
being the only jurisdictions in which the nature of its business or
the ownership or leasing of the property requires such
qualification, except where the failure to be so qualified would
not individually or in the aggregate have a Material Adverse
Effect. Each Subsidiary that is not a Significant Subsidiary has
been duly incorporated or formed and is validly existing as a
corporation or other entity, as the case may be, in good standing
under the laws of the jurisdiction of its incorporation or
organization, with the requisite corporate, trust, partnership or
other power to acquire and own, lease and operate its properties
and to conduct its business, as described in the Registration
Statement, the Prepricing Prospectus, the Prospectus and the
Permitted Free Writing Prospectuses, if any; and each Subsidiary
that is not a Significant Subsidiary is duly qualified and in good
standing to do business in each jurisdiction in which the nature of
its business or the ownership or leasing of the property requires
such qualification, except where the failure to be so qualified
would not individually or in the aggregate have a Material Adverse
Effect;
(i) this Agreement has been duly authorized,
executed and delivered by the Company;
(j) the shares of beneficial interest of the
Company, including the Shares, conform in all material respects to
each description thereof, if any, included or incorporated by
reference in the Registration Statement, any Prepricing Prospectus,
the Prospectus or any Permitted Free Writing Prospectus. The
certificates, if any, evidencing the Shares are in due and proper
form and conform in all material respects to the requirements of
the Maryland REIT Law;
(k) the Shares have been duly and validly
authorized and, when issued and delivered against payment therefore
as provided herein, will be duly and validly issued, fully paid and
non-assessable and free of any preemptive or similar
rights;
(l) neither the Company nor any of the Subsidiaries
is in breach or violation of, or in default under (and no event has
occurred which with notice, lapse of time, or both would result in
any breach or violation of, or constitute a default under), (i) its
Declaration of Trust, charter or by-laws or other organizational
documents, (ii) any obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Company or any
Subsidiary is subject or by which any of them or any of their
properties is bound or affected or (iii) any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its or its
Subsidiaries’ properties, except,
in the case of
clauses (ii) and (iii), for those breaches, violations or defaults
which, individually or in the aggregate, would not have a Material
Adverse Effect;
(m) the issuance by the Company of the Shares, the
compliance by the Company with all of the provisions of this
Agreement, the execution, delivery and performance by the Company
of this Agreement, and the consummation of the transactions
contemplated herein (including, without limitation, the application
of the net proceeds of the offering by the Company as described in
the Prospectus) will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon the Shares or any property or assets of
the Company pursuant to (i) the provisions of the Declaration of
Trust or the bylaws of the Company or any Subsidiary or any of the
Company’s or any Subsidiary’s other organizational
documents, (ii) any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or
any Subsidiary is a party or by which the Company or any Subsidiary
is bound or to which any of the property or assets of the Company
or any Subsidiary is subject, or (iii) any applicable laws or any
order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company or any of its or its
Subsidiaries’ properties, other than, in the case of clause
(ii), as would not, individually or in the aggregate, have a
Material Adverse Effect or a material adverse effect on the ability
of the Company to consummate the transactions contemplated
hereby;
(n) no approval, authorization, consent or order of
or filing with any federal, state or local or foreign governmental
or regulatory commission, board, body, authority or agency or with
the New York Stock Exchange (“NYSE”), or approval of
the shareholders of the Company, is required in connection with the
issuance and sale of the Shares or the consummation by the Company
of the transactions as contemplated hereby (including, without
limitation, the application of the net proceeds of the offering by
the Company as described in the Prepricing Prospectus and the
Prospectus), other than registration of the Shares under the Act,
which has been effected (or, with respect to any registration
statement to be filed hereunder pursuant to Rule 462(b) under the
Act, will be effected in accordance herewith), and any necessary
qualification under the securities or blue sky laws of the various
jurisdictions in which the Shares are being offered by the
Underwriters;
(o) no person has the right, contractual or
otherwise, to cause the Company to issue to it, or register
pursuant to the Act, any shares of beneficial interest or other
equity interests. No person has preemptive rights, co-sale rights,
rights of first refusal or other rights to purchase any Common
Shares. No person has the right, contractual or otherwise, to cause
the Company to register under the Act any shares of beneficial
interest or other equity interests as a result of the filing or
effectiveness of the Registration Statement or the sale of Shares
contemplated thereby, except for such rights as have been complied
with or waived;
(p) Ernst & Young LLP, whose report on the
consolidated financial statements of the Company and the
Subsidiaries was filed with the Commission as part of the
Company’s Annual Report on Form 10-K for the fiscal year
ended December 31,
2005 and is
incorporated by reference in the Registration Statement, the
Prepricing Prospectus, the Prospectus and, if applicable, any
Permitted Free Writing Prospectuses, are independent public
accountants as required by the Act and by the rules of the Public
Company Accounting Oversight Board;
(q) all legal or governmental proceedings,
affiliate or other related party transactions, off-balance sheet
transactions (including, without limitation, transactions related
to, and the existence of, “variable interest entities”
within the meaning of Financial Accounting Standards Board
Interpretation No. 46), contracts, leases or documents of a
character required to be described in the Registration Statement,
the Prepricing Prospectus, the Prospectus or any Incorporated
Document, and all documents required to be filed as an exhibit to
the Registration Statement, any Prepricing Prospectus, the
Prospectus or any Incorporated Document, have been so described or
filed or will be filed prior to the time of purchase as
required;
(r) except as otherwise described in the
Registration Statement, each Disclosure Package and the Prospectus,
there are no legal or governmental proceedings pending to which the
Company or any of the Subsidiaries is a party or of which any of
the Company’s or any of the Subsidiaries’ properties or
assets is the subject, the result of which would, individually or
in the aggregate, have a Material Adverse Effect or a material
adverse effect on the ability of the Company to consummate the
transactions contemplated hereby, and, to the Company’s
knowledge, no such proceedings are threatened or contemplated,
except as disclosed in the Registration Statement, each Disclosure
Package and the Prospectus, the result of which would, individually
or in the aggregate, have a Material Adverse Effect or a material
adverse effect on the ability of the Company to consummate the
transactions contemplated hereby. To the Company’s knowledge,
there are no legal or governmental proceedings pending or
threatened to which any lessee, sublessee or operator of any
property of the Company or any Subsidiary or portion thereof is a
party, the result of which would, individually or in the aggregate,
have a Material Adverse Effect, and no such proceedings are being
threatened or contemplated, except as disclosed in the Registration
Statement, each Disclosure Package and the Prospectus and the
result of which would, individually or in the aggregate, have a
Material Adverse Effect. Neither the Company nor any of the
Subsidiaries has received from any governmental authority notice of
any violation of any local, state or federal law, rule or
regulation (including without limitation any such law, rule or
regulation applicable to the health care industry (“Health
Care Laws”) or relating to human health or safety or the
environment or any hazardous or toxic substances or wastes,
pollutants or contaminants (“Environmental Laws”)),
except as disclosed in the Registration Statement, each Disclosure
Package and the Prospectus, the result of which would, individually
or in the aggregate, have a Material Adverse Effect, and to the
Company’s knowledge, there is no such violation, or any
occurrence or circumstance that would give rise to a claim under or
pursuant to any local, state or federal law, rule or regulation
(including without limitation any Health Care Laws or Environmental
Laws), which would, individually or in the aggregate, have a
Material Adverse Effect. To the Company’s knowledge, there is
no violation of any local, state or federal law, rule or regulation
(including without limitation Health Care Laws and Environmental
Laws) by any person from whom the Company or any of the
Subsidiaries acquired any of its
properties (a
“seller”), or any lessee, sublessee or operator of any
of their respective properties or any part thereof, the result of
which would, individually or in the aggregate, have a Material
Adverse Effect, and to the Company’s knowledge, there is no
such violation, or any occurrence or circumstance that would give
rise to a claim under or pursuant to any local, state or federal
law, rule or regulation (including without limitation any Health
Care Laws or Environmental Laws), which would, individually or in
the aggregate, have a Material Adverse Effect, except as disclosed
in the Registration Statement, each Disclosure Package and the
Prospectus. Neither the Company nor any of the Subsidiaries has
received from any governmental authority any written notice of any
condemnation of or zoning change affecting the properties or any
part thereof of the Company or any of the Subsidiaries that
individually or in the aggregate would have a Material Adverse
Effect and the Company does not know of any such condemnation or
zoning change which is threatened and which if consummated
individually or in the aggregate would have a Material Adverse
Effect. Nothing has come to the Company’s attention that any
seller, lessee, sublessee or operator of any property of the
Company or any of the Subsidiaries, or portion thereof has,
received from any governmental authority any written notice of any
condemnation of or zoning change affecting the Properties (as
defined in Section 3(s) below) or any part thereof of the Company
or any of the Subsidiaries that individually or in the aggregate
would have a Material Adverse Effect;
(s) as of the respective dates at which such
information is given, each of the Company and the Subsidiaries has
good and marketable title in fee simple or ground leases to the
properties disclosed in the Registration Statement, each Disclosure
Package and the Prospectus as being owned by them (the
“Properties”); and the Properties are free and clear of
all liens, encumbrances, claims, mortgages, deeds of trust,
restrictions, security interests and defects (“Property
Encumbrances”), except for: (i) the leasehold interests of
lessees in the Company’s and the Subsidiaries’
properties held under lease (the “Leases”), (ii) any
other Property Encumbrances that would not, individually or in the
aggregate, have a Material Adverse Effect and (iii) those Property
Encumbrances set forth in the Registration Statement, each
Disclosure Package and the Prospectus. All Property Encumbrances on
or affecting the properties of the Company or any of the
Subsidiaries which are required to be disclosed in the Registration
Statement, each Disclosure Package and the Prospectus are disclosed
therein. Except where it would not individually or in the aggregate
have a Material Adverse Effect, each of the Leases pertaining to
the properties of the Company or any of the Subsidiaries has been
duly authorized by the Company or one of the Subsidiaries, as
applicable, and is a valid and binding agreement of the Company or
one of the Subsidiaries, as applicable, and, to the Company’s
knowledge, each other party thereto, enforceable in accordance with
its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency, moratorium, fraudulent conveyance or other
similar laws affecting the enforcement of creditors’ rights
generally and by general equitable principles. To the
Company’s knowledge, no lessee of any portion of any of the
properties of the Company or any of the Subsidiaries is in default
under its respective lease and there is no event which, but for the
passage of time or the giving of notice or both, would constitute a
default under any such lease, except as disclosed in the
Registration Statement, each Disclosure Package and the Prospectus
and except for such defaults that would not, individually or in the
aggregate, have a Material Adverse Effect;
(t) the Company and each of the Subsidiaries and,
to the Company’s knowledge, each of the operators, lessees or
sublessees of any property or portion thereof of the Company or any
of the Subsidiaries have such permits, licenses, approvals,
certificates, franchises and authorizations of governmental or
regulatory authorities (“permits”), including, without
limitation, under any Health Care Laws or Environmental Laws, as
are necessary in the case of each such party to acquire and own,
lease or operate its properties and to conduct its business, except
where the failure to obtain such permits would not individually or
in the aggregate have a Material Adverse Effect; except as
described in the Registration Statement, each Disclosure Package
and the Prospectus, the Company and each of the Subsidiaries and,
to the Company’s knowledge, each of the lessees, sublessees
or operators of any property or portion thereof of the Company or
any of the Subsidiaries have fulfilled and performed all of their
obligations with respect to such permits and, except as disclosed
in the Registration Statement, each Disclosure Package and the
Prospectus, no event has occurred which allows, or after notice or
lapse of time would allow, revocation or termination thereof or
result in any other impairment of the rights of the holder of any
such permit, except where the failure to fulfill or perform, or the
resulting termination or impairment, would not, individually or in
the aggregate, have a Material Adverse Effect; and, except as
described in the Registration Statement, each Disclosure Package
and the Prospectus, such permits contain no restrictions that are
burdensome to the Company and the Subsidiaries, taken as a whole
and that would, individually or in the aggregate, have a Material
Adverse Effect;
(u) the financial statements, together with the
related schedules and notes, forming a part of the Registration
Statement, any Prepricing Prospectus, the Prospectus or any
Permitted Free Writing Prospectus, present fairly the consolidated
financial position of the Company and the Subsidiaries as of the
dates indicated and the consolidated results of operations and cash
flows of the Company and the Subsidiaries for the periods
specified. Such financial statements have been prepared in
conformity with generally accepted accounting principles applied on
a consistent basis during the periods involved. Any pro forma
financial statements and other pro forma financial data included or
incorporated by reference in the Registration Statement, any
Prepricing Prospectus, the Prospectus or any Permitted Free Writing
Prospectus comply as to form in all material respects with the
applicable accounting requirements of Regulation S-X of the Act,
and the pro forma adjustments have been properly applied to the
historical amounts in the compilation of those statements. To the
extent applicable, all disclosures contained in the Registration
Statement, any Prepricing Prospectus, the Prospectus, any Permitted
Free Writing Prospectus or any Incorporated Document regarding
Non-GAAP Financial Measures (as such term is defined by the rules
and regulations of the Commission) comply, in all material
respects, with Regulation G of the Exchange Act and, if applicable,
Item 10 of Regulation S-K. The Company and the Subsidiaries do not
have any material liabilities or obligations, direct or contingent
(including any off-balance sheet obligations or any “variable
interest entities” within the meaning of Financial Accounting
Standards Board Interpretation No. 46), not disclosed in the
Registration Statement, each Prepricing Prospectus and the
Prospectus. The other financial and statistical data set forth in
the Registration Statement, any Prepricing Prospectus, the
Prospectus and any Permitted Free Writing Prospectus are accurately
presented and prepared on a basis consistent with the financial
statements and books and
records of the
Company. There are no financial statements (historical or pro
forma) that are required to be included in the Registration
Statement, any Prepricing Prospectus or the Prospectus that are not
included as required;
(v) subsequent to the respective dates as of which
information is given in the Registration Statement, any Prepricing
Prospectus, the Prospectus and any Permitted Free Writing
Prospectus, in each case excluding any amendments or supplements to
the foregoing made after the execution of this Agreement, there has
not been (i) any material adverse change, or any prospective
material adverse change, in the business, properties, condition
(financial or otherwise) or results of operations of the Company
and the Subsidiaries taken as a whole, (ii) any transaction which
is material to the Company or the Subsidiaries, (iii) any
obligation, direct or contingent, which is material to the Company
and the Subsidiaries taken as a whole, incurred by the Company or
the Subsidiaries, (iv) any material change in the outstanding
shares of beneficial interest or material increase in the
outstanding indebtedness of the Company or the Subsidiaries or (v)
any dividend or distribution of any kind declared, paid or made on
the shares of beneficial interest of the Company or a dividend
distribution of any kind on any class of its shares of beneficial
interest (other than dividends or distributions from wholly-owned
subsidiaries of the Company) other than (A) regular quarterly
dividends, declared, paid or made and (B) the issuance of common
shares of beneficial interest to the trustees and officers of the
Company and directors, officers and employees of Reit Management
& Research LLC, the Company’s investment manager
(“RMR”), pursuant to the Company’s Incentive
Share Award Plan and to RMR in payment of its incentive fee in
accordance with the Company’s advisory agreement with RMR
filed as an exhibit to the Registration Statement. None of the
Company nor the Subsidiaries has any material contingent obligation
which is not disclosed in the Registration Statement;
(w) each of the Company and the Subsidiaries are
insured by insurers of recognized financial responsibility against
such losses and risks and in such amount as are customary in the
business in which they are engaged, except as described in the
Registration Statement, each Disclosure Package and the Prospectus.
Except as would not, individually or in the aggregate, have a
Material Adverse Effect, all policies of insurance insuring the
Company and the Subsidiaries or any of their businesses, assets,
employees, officers, directors and trustees are in full force and
effect, and the Company and the Subsidiaries are in compliance with
the terms of such policies in all material respects. Except as
would not, individually or in the aggregate, have a Material
Adverse Effect, there are no claims by the Company or any of the
Subsidiaries under any such policy or instrument as to which any
insurance company is denying liability or defending under a
reservation of rights clause;
(x) except as disclosed in the Registration
Statement, each Disclosure Package and the Prospectus, neither the
Company nor any of the Subsidiaries has either sent or received any
communication regarding termination of, or intent not to renew, any
of the contracts or agreements referred to or described in, or
filed as an exhibit to, the Registration Statement, any Prepricing
Prospectus, the Prospectus, any Permitted Free Writing Prospectus
or any Incorporated Document, and no such termination or
non-
renewal has
been threatened by the Company or any of the Subsidiaries or any
other party to any such contract or agreement;
(y) the Company has obtained for the benefit of the
Underwriters the agreement (a “Lock-Up Agreement”), in
the form set forth as Exhibit A hereto, of its managing trustees
(Messrs. Barry M. Portnoy and Gerard M. Martin) and executive
officers (Messrs. David J. Hegarty and John R. Hoadley);
(z) neither the Company nor any of the Subsidiaries
or any of their respective affiliates has taken, directly or
indirectly, any action designed to or which has constituted or
which might reasonably be expected to cause or result, under the
Exchange Act or otherwise, in the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or
resale of the Shares;
(aa) the Company and the Subsidiaries have not
sustained since the date of the latest audited financial statements
included in the Registration Statement, any Prepricing Prospectus
and the Prospectus any loss or interference with their businesses
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, otherwise than as disclosed
in the Prospectus or other than any loss or interference, which
would not individually or in the aggrega
