Exhibit 1.1
D IGITAL R EALTY T RUST , I NC .
Underwriting Agreement
New York, New York
September 28, 2006
To the Representatives
named in
Schedule I
hereto of
the Underwriters
named in
Schedule II hereto
Ladies and Gentlemen:
Digital Realty Trust, Inc., a
corporation organized under the laws of the State of Maryland (the
“Company”), proposes to sell to the several
underwriters named in Schedule II hereto (the
“Underwriters”), for whom you (the
“Representatives”) are acting as representatives, the
number of shares of Common Stock, $0.01 par value (“Common
Stock”), of the Company set forth in Schedule I hereto (said
shares to be issued and sold by the Company being hereinafter
called the “Underwritten Securities”). The Company also
proposes to grant to the Underwriters an option to purchase up to
the number of additional shares of Common Stock set forth in
Schedule I hereto to cover over-allotments (the “Option
Securities”; the Option Securities, together with the
Underwritten Securities, being hereinafter called the
“Securities”). To the extent there are no additional
Underwriters listed on Schedule II other than you, the term
Representatives as used herein shall mean you, as Underwriters, and
the terms Representatives and Underwriters shall mean either the
singular or plural as the context requires. Any reference herein to
the Registration Statement, the Basic Prospectus, any Preliminary
Final Prospectus or the Final Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 which were filed under
the Exchange Act on or before the Effective Date of the
Registration Statement or the issue date of the Basic Prospectus,
any Preliminary Final Prospectus or the Final Prospectus, as the
case may be; and any reference herein to the terms
“amend,” “amendment” or
“supplement” with respect to the Registration
Statement, the Basic Prospectus, any Preliminary Final Prospectus
or the Final Prospectus shall be deemed to refer to and include the
filing of any document under the Exchange Act after the Effective
Date of the Registration Statement or the issue date of the Basic
Prospectus, any Preliminary Final Prospectus or the Final
Prospectus, as the case may be, deemed to be incorporated therein
by reference. Certain terms used herein are defined in
Section 20 hereof.
1. Representations and
Warranties . The Company and its operating partnership
subsidiary, Digital Realty Trust, L.P. (the “Operating
Partnership”), jointly and severally represent and warrant to
each Underwriter, and agree with each Underwriter as set forth
below in this Section 1.
(a) The Company meets the
requirements for use of Form S-3 under the Act and has prepared and
filed with the Commission an automatic shelf registration
statement, as defined in Rule 405 (the file number of which is set
forth in Schedule I hereto) on Form S-3, including a related basic
prospectus, for registration under the Act of the offering and sale
of the Securities. Such Registration Statement, including any
amendments thereto filed prior to the Execution Time, became
effective upon filing. The Company may have filed with the
Commission, as part of an amendment to the Registration Statement
or pursuant to Rule 424(b), one or more Preliminary Final
Prospectuses, each of which has previously been furnished to you.
The Company will file with the Commission a Final Prospectus
relating to the Securities in accordance with Rule 424(b). As
filed, such Final Prospectus shall contain all information required
by the Act and the rules thereunder, and, except for such
modifications to which the Representatives do not reasonably
object, shall be in all substantive respects in the form furnished
to you prior to the Execution Time or, to the extent not completed
at the Execution Time, shall contain only such specific additional
information and other substantive changes (beyond that contained in
the Basic Prospectus and any Preliminary Final Prospectus) as the
Company has advised you, prior to the Execution Time, will be
included or made therein. The Registration Statement, at the
Execution Time, meets the requirements set forth in Rule
415(a)(1)(x).
(b) On the Effective Date, the
Registration Statement did, and when the Final Prospectus is first
filed (if required) in accordance with Rule 424(b) and on the
Closing Date (as defined herein) and on any date on which Option
Securities are purchased, if such date is not the Closing Date (a
“settlement date”), the Final Prospectus (and any
supplement thereto) will, comply in all material respects with the
applicable requirements of the Act and the Exchange Act and the
respective rules thereunder; on the Effective Date and at the
Execution Time, the Registration Statement did not contain any
untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make
the statements therein not misleading; and on the date of any
filing pursuant to Rule 424(b) and on the Closing Date and any
settlement date, the Final Prospectus (together with any
supplements thereto) will not include any 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; provided ,
however , that the Company makes no representations or
warranties as to the information contained in or omitted from the
Registration Statement or the Final Prospectus (or any supplement
thereto) in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any
Underwriter through the Representatives specifically for inclusion
in the Registration Statement or the Final Prospectus (or any
supplement thereto), it being understood and agreed that the only
such information furnished by or on behalf of any Underwriters
consists of the information described as such in Section 8
hereof.
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(c) The Disclosure Package and the
information set forth under the heading “Title, Purchase
Price and Description of Securities” in Schedule I hereto to
be disclosed on the cover page of the Final Prospectus, in the
section entitled “Prospectus Supplement Summary – The
Offering” in the Final Prospectus and the section entitled
“Underwriting” in the Final Prospectus, when taken
together as a whole, do not contain any untrue statement of a
material fact or omit to state any material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The preceding sentence
does not apply to statements in or omissions from the Disclosure
Package based upon and in conformity with written information
furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood
and agreed that the only such information furnished by or on behalf
of any Underwriter consists of the information described as such in
Section 8 hereof. No stop order suspending the effectiveness
of the Registration Statement or any part thereof has been issued
and, to the Company’s knowledge, no proceeding for that
purpose has been instituted or threatened by the Commission or by
the state securities authority of any jurisdiction. No order
preventing or suspending the use of the Final Prospectus has been
issued and, to the Company’s knowledge, no proceeding for
that purpose has been instituted by the Commission or by the state
securities authority of any jurisdiction.
(d) (i) At the time of filing the
Registration Statement, (ii) at the time of the most recent
amendment thereto for the purposes of complying with
Section 10(a)(3) of the Act (whether such amendment was by
post-effective amendment, incorporated report filed pursuant to
Sections 13 or 15(d) of the Exchange Act or form of prospectus),
(iii) at the time the Company or any person acting on its
behalf (within the meaning, for this clause only, of Rule 163(c))
made any offer relating to the Securities in reliance on the
exemption in Rule 163, and (iv) at the Execution Time (with
such date being used as the determination date for purposes of this
clause (iv)), the Company was or is (as the case may be) a
“well-known seasoned issuer” as defined in Rule 405.
The Company agrees to pay the fees required by the Commission
relating to the Securities within the time required by Rule
456(b)(1) without regard to the proviso therein and otherwise in
accordance with Rules 456(b) and 457(r).
(e) (i) At the earliest time after
the filing of the Registration Statement that the Company or
another offering participant made a bona fide offer (within
the meaning of Rule 164(h)(2)) of the Securities and (ii) as
of the Execution Time (with such date being used as the
determination date for purposes of this clause (ii)), the Company
was not and is not an Ineligible Issuer (as defined in Rule 405),
without taking account of any determination by the Commission
pursuant to Rule 405 that it is not necessary that the Company be
considered an Ineligible Issuer.
(f) Each Issuer Free Writing
Prospectus does not include any information that conflicts with the
information contained in the Registration Statement, including any
document incorporated therein and any prospectus supplement deemed
to be a part thereof that has not been superseded or modified. The
foregoing sentence does not apply to statements in or omissions
from the Disclosure Package based upon and in
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conformity with written information
furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood
and agreed that the only such information furnished by or on behalf
of any Underwriter consists of the information described as such in
Section 8 hereof.
(g) All documents filed by the
Company pursuant to Sections 12, 13, 14 or 15 of the Exchange Act,
when they became or, prior to the settlement date for the Option
Securities, become effective or were or, prior to the settlement
date for the Option Securities, are filed with the Commission, as
the case may be, complied or will comply in all material respects
with the requirements of the Act and the rules thereunder or the
Exchange Act and the rules thereunder, as applicable.
(h) (i) The Company has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the State of Maryland with full
corporate power and authority to own or lease, as the case may be,
and to operate its properties and conduct its business as described
in the Disclosure Package and the Final Prospectus, and to enter
into and perform its obligations under this Agreement and as
general partner of the Operating Partnership to cause the Operating
Partnership to enter into and perform the Operating
Partnership’s obligations under this Agreement and the Fourth
Amended and Restated Agreement of Limited Partnership of the
Operating Partnership (the “Operating Partnership
Agreement”), and is duly qualified to do business as a
foreign corporation and is in good standing under the laws of each
jurisdiction which requires such qualification, except where the
failure to be so qualified would not reasonably be expected to have
a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of
business.
(i) The Operating Partnership has
been duly formed and is validly existing as a limited partnership
in good standing under the laws of the State of Maryland with full
power and authority to own or lease, as the case may be, and to
operate its properties and conduct its business as described in the
Disclosure Package and the Final Prospectus and to enter into and
perform its obligations under this Agreement, and is duly qualified
to do business and is in good standing as a foreign limited
partnership under the laws of each jurisdiction which requires such
qualification, except where the failure to be so qualified would
not reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business
or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary
course of business.
(j) Each Subsidiary (as defined
below) of the Company has been duly formed and is validly existing
as a corporation, limited liability company or limited partnership,
as the case may be, in good standing under the laws of the
jurisdiction in which it is chartered or organized with full power
and authority (corporate and other) to own or lease, as the case
may be, and to operate its properties and conduct its business as
described in the Disclosure Package and the Final Prospectus, and
is duly qualified to do
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business as a foreign corporation,
limited liability company or limited partnership, as the case may
be, and is in good standing under the laws of each jurisdiction
which requires such qualification, except where the failure to be
so qualified would not reasonably be expected to have a material
adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business.
(k) All the outstanding shares of
capital stock or other ownership interests of each Subsidiary
(other than the Operating Partnership) have been duly and validly
authorized and issued and are fully paid and nonassessable, and, as
of the Closing Date, except as otherwise set forth in the
Disclosure Package and the Final Prospectus, all outstanding shares
of capital stock or other ownership interests of the Subsidiaries
will be owned by the Company either directly or through wholly
owned subsidiaries free and clear of any perfected security
interest or any other security interests, claims, mortgages,
pledges, liens, encumbrances or other restrictions of any kind
(collectively, “Liens”), except for Liens securing
indebtedness as described in the Disclosure Package and the Final
Prospectus or except where such Liens would not individually or in
the aggregate materially affect or interfere in any material
respect with the Company’s ability to exercise control over
each of such Subsidiaries. Except as set forth in the Disclosure
Package and the Final Prospectus, there are no outstanding options,
warrants or other rights to purchase, agreements or other
obligations to issue, or rights to convert any obligations into or
exchange any securities or interests for capital stock or other
ownership interests of any Subsidiary.
(l) The Company’s authorized
equity capitalization is as set forth in the Disclosure Package and
the Final Prospectus; the capital stock of the Company conforms in
all material respects to the description thereof contained in the
Disclosure Package and the Final Prospectus; the outstanding shares
of Common Stock, 8.50% Series A Cumulative Redeemable Preferred
Stock, $0.01 par value (“Series A Preferred
Stock”) and 7.875% Series B Cumulative Redeemable
Preferred Stock, $0.01 par value (“Series B Preferred
Stock”) of the Company have been duly and validly authorized
and issued and are fully paid and nonassessable; the Securities
have been duly and validly authorized, and, when issued and
delivered to and paid for by the Underwriters pursuant to the terms
of this Agreement, will be fully paid and nonassessable; the
Securities are duly listed, and admitted and authorized for
trading, subject to official notice of issuance and evidence of
satisfactory distribution, on the New York Stock Exchange; the
certificates for the Securities are in valid and sufficient form;
the holders of outstanding shares of capital stock of the Company
are not entitled to preemptive or other rights to subscribe for the
Securities; and, except as set forth in the Disclosure Package and
the Final Prospectus, no options, warrants or other rights to
purchase, agreements or other obligations to issue, or rights to
convert any obligations into or exchange any securities for, shares
of capital stock of or ownership interests in the Company are
outstanding; all offers and sales of the Company’s shares of
Common Stock, Series A Preferred Stock and Series B
Preferred Stock prior to the date hereof were at all relevant times
duly registered under the Act or were exempt from the registration
requirements of the Act and
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were duly registered or the subject
of an available exemption from the registration requirements of the
applicable state securities or blue sky laws.
(m) All of the issued and
outstanding units of limited partnership (“Units”) of
the Operating Partnership have been duly and validly authorized and
issued by the Operating Partnership and conform in all material
respects to the description thereof contained in the Disclosure
Package and the Final Prospectus. None of the Units was issued in
violation of the preemptive or other similar rights of any security
holder of the Operating Partnership or any other person or entity.
Except as set forth in the Disclosure Package and the Final
Prospectus, there are no outstanding options, warrants or other
rights to purchase, agreements or other obligations to issue, or
rights to convert any obligations into or exchange any securities
or interests for, Units or other ownership interests of the
Operating Partnership. The Units owned by the Company (including
all outstanding Series A Preferred Limited Partnership Units
and Series B Preferred Limited Partnership Units) are owned
directly by the Company, free and clear of all Liens. The common
limited partnership units to be issued by the Operating Partnership
in connection with the contribution of the net proceeds from the
sale of the Securities to the Operating Partnership (the “New
Common Units”) have been duly authorized, and, when issued
and delivered by the Operating Partnership, will be validly issued
and fully paid. The New Common Units will be exempt from
registration or qualification under the Act and applicable state
securities laws. None of the New Common Units will be issued in
violation of the preemptive or other similar rights of any security
holder of the Operating Partnership or any other person or entity.
To the extent any portion of the over-allotment option is
exercised, the Company will contribute the net proceeds from the
sale of the Option Securities to the Operating Partnership for a
number of common limited partnership units of the Operating
Partnership, the economic terms of which are substantially similar
to the Common Stock, equal to the number of Option Securities
issued (the “Option Units”). The Option Units have been
duly authorized, and, when issued and delivered by the Operating
Partnership, will be validly issued and fully paid. The Option
Units will be exempt from registration or qualification under the
Act and applicable state securities laws. None of the Option Units
will be issued in violation of the preemptive or other similar
rights of any security holder of the Operating Partnership or any
other person or entity.
(n) There is no franchise, contract
or other document of a character required to be described in the
Registration Statement or the Final Prospectus, or to be filed as
an exhibit thereto, which is not described or filed as required;
and the statements in the Basic Prospectus under the headings
“Description of the Partnership Agreement of Digital Realty
Trust, L.P.,” “Description of Securities,”
“Material Provisions of Maryland Law and of Our Charter and
Bylaws,” “Plan of Distribution,”
“Restrictions on Ownership and Transfer” and
“United States Federal Income Tax Considerations Related to
Our REIT Election,” and in the Final Prospectus under the
heading “United States Federal Income Tax
Considerations” insofar as such statements summarize legal
matters, agreements, documents or proceedings discussed therein,
are accurate and fair summaries of such legal matters, agreements,
documents or proceedings.
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(o) This Agreement has been duly
authorized, executed and delivered by each of the Company and the
Operating Partnership. This Agreement constitutes a legally valid
and binding obligation of each of the Company and the Operating
Partnership, enforceable against each of the Company and the
Operating Partnership in accordance with its terms, except to the
extent that such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws
relating to or affecting creditors’ rights and general
principles of equity and except as rights to indemnity and
contribution thereunder may be limited by applicable law or
policies underlying such law.
(p) Neither the Company nor the
Operating Partnership is and, after giving effect to the offering
and sale of the Securities and the application of the proceeds
thereof as described in the Final Prospectus, will not be an
“investment company” as defined in the Investment
Company Act of 1940, as amended.
(q) No consent, approval,
authorization, filing with or order of any court or governmental
agency or body is required in connection with the transactions
contemplated herein, except such as have been obtained under the
Act, such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution of
the Securities by the Underwriters in the manner contemplated
herein and in the Disclosure Package and the Final Prospectus or
such consents, approvals, authorizations, filings or orders that
will be obtained or completed by the Closing Date or the absence of
which, individually or in the aggregate, would not reasonably be
expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business.
(r) Neither the issue and sale of
the Securities nor the consummation of any other of the
transactions herein contemplated nor the fulfillment of the terms
hereof will conflict with, result in a breach or violation of, or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to,
(i) the charter or by-laws of the Company or the
organizational or other governing documents of any of its
subsidiaries, (ii) the terms of any indenture, contract,
lease, mortgage, deed of trust, note agreement, loan agreement or
other agreement, obligation, condition, covenant or instrument to
which the Company or any of its subsidiaries is a party or bound or
to which its or their property is subject, or (iii) any
statute, law, rule, regulation, judgment, order or decree
applicable to the Company or any of its subsidiaries of any court,
regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company
or any of its subsidiaries or any of its or their properties,
except, in the case of clauses (ii) or (iii) above, for
such conflicts, breaches, violations, liens, charges or
encumbrances that, individually or in the aggregate, would not
reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business
or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary
course of business.
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(s) Except as set forth in the
Disclosure Package and the Final Prospectus, no holders of
securities of the Company have rights to the registration of such
securities under the Registration Statement. Except as set forth in
the Disclosure Package and the Final Prospectus, there are no
contracts, agreements or understandings between the Company or the
Operating Partnership and any person granting such person the right
to require the Company or the Operating Partnership to file a
registration statement under the Act with respect to any securities
of the Company or the Operating Partnership owned or to be owned by
such person or to require the Company or the Operating Partnership
to include such securities in any securities being registered
pursuant to any other registration statement filed by the Company
or the Operating Partnership under the Act.
(t) The financial statements and
schedules, including the notes thereto, filed with the Commission
as part of or incorporated by reference in the Registration
Statement, and included or incorporated by reference in the
Disclosure Package and the Final Prospectus, present fairly in all
material respects the financial condition, results of operations
and cash flows of the Company as of the dates and for the periods
indicated, comply as to form in all material respects with the
applicable accounting requirements of the Act and have been
prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods
involved (except as otherwise noted therein). The selected
financial data set forth under the caption “Selected
Financial Data” incorporated by reference in the Final
Prospectus and the Registration Statement fairly present in all
material respects, on the basis stated therein, the information
included therein. The pro forma financial statements incorporated
by reference in the Final Prospectus and the Registration Statement
include assumptions that provide a reasonable basis for presenting
the significant effects directly attributable to the transactions
and events described therein, the related pro forma adjustments
give appropriate effect to those assumptions, and the pro forma
adjustments reflect the proper application of those adjustments to
the historical financial statement amounts in the pro forma
financial statements incorporated by reference in the Final
Prospectus and the Registration Statement. The pro forma financial
statements including the notes thereto, incorporated by reference
in the Registration Statement, and incorporated by reference in the
Disclosure Package and the Final Prospectus, comply as to form in
all material respects with the applicable accounting requirements
of Regulation S-X under the Act and the pro forma adjustments have
been properly applied to the historical amounts in the compilation
of those statements. No other financial statements or schedules are
required to be included or incorporated by reference in the
Registration Statement, the Disclosure Package or the Final
Prospectus.
(u) No action, suit or proceeding by
or before any court or governmental agency, authority or body or
any arbitrator involving the Company or any of its subsidiaries or
its or their property is pending or, to the best knowledge of the
Company, threatened that (i) could reasonably be expected to
have a material adverse effect on the performance of this Agreement
or the consummation of any of the transactions contemplated hereby
or (ii) could reasonably be expected to have a material
adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising
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from transactions in the ordinary
course of business, except as set forth in or contemplated in the
Disclosure Package and the Final Prospectus (exclusive of any
supplement thereto).
(v) (i) The Company or its
subsidiaries have fee simple title to or leasehold interest in all
of the properties described in the Disclosure Package and the Final
Prospectus as owned or leased by them and the improvements
(exclusive of improvements owned by tenants) located thereon (the
“Properties”), in each case, free and clear of all
liens, encumbrances, claims, security interests, restrictions and
defects, except such as are disclosed in the Disclosure Package and
the Final Prospectus or do not materially affect the value of such
Property and do not materially interfere with the use made and
proposed to be made of such Property by the Company and any
subsidiary; (ii) except as otherwise set forth in or
contemplated in the Disclosure Package and the Final Prospectus,
the mortgages and deeds of trust encumbering the Properties
described in the Disclosure Package and the Final Prospectus are
not convertible into equity securities of the Company or the
Operating Partnership and such mortgages and deeds of trust are not
cross-defaulted or cross-collateralized to any property not owned
directly or indirectly by the Company or its subsidiaries;
(iii) neither the Company nor any of its subsidiaries has
received from any governmental authority any written notice of any
condemnation of or zoning change affecting the Properties or any
part thereof, and none of the Company or any subsidiary knows of
any such condemnation or zoning change which is threatened and
which if consummated would reasonably be expected to have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business; (iv) each of
the Properties complies with all applicable codes, laws and
regulations (including without limitation, building and zoning
codes, laws and regulations and laws relating to access to the
Properties), except if and to the extent disclosed in the
Disclosure Package and the Final Prospectus and except for such
failures to comply that would not individually or in the aggregate
reasonably be expected to materially affect the value of such
Property or interfere in any material respect with the use made and
proposed to be made of such Property by the Company or any
subsidiary; (v) the Company or a subsidiary has an
owner’s or leasehold title insurance policy, from a
nationally recognized title insurance company licensed to issue
such policy, on each Property that insures the fee or leasehold
interest, as the case may be, in such Property, which policies
include only commercially reasonable exceptions, and with coverage
in amounts at least equal to amounts that are generally deemed in
the Company’s industry to be commercially reasonable in the
markets where such Property is located; (vi) except as set
forth in the Disclosure Package and the Final Prospectus or as set
forth on Schedule 1(p) hereto, neither the Company nor any
subsidiary holds any Property under a ground lease; and
(vii) to the knowledge of the Company and the Operating
Partnership, except as set forth in or contemplated in the
Disclosure Package and the Final Prospectus and, with respect to
(A) below, except as would not individually or in the
aggregate reasonably be expected to materially affect the value of
such Property or interfere in any material respect with the use
made and proposed to be made of such Property by the Company or any
subsidiary: (A) no tenant under any lease described in the
“Properties” section of the Company’s Annual
Report on Form 10-K for the fiscal
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year ended December 31, 2005
where the tenant has been specifically identified (a “Major
Lease”) has asserted in writing any defense or set-off
against the payment of rent in connection with any Major Lease nor
has any tenant contested any tax, operating cost or other
escalation payment or occupancy charge, or any other amounts
payable under its Major Leases; (B) neither the Company nor
the Operating Partnership has waived in writing any material
provision under any Major Lease; (C) there are no uncured
events of default, or events that with the giving of notice or
passage of time, or both, would constitute an event of default, by
any tenant under any of the terms and provisions of any Major
Lease; and (D) no tenant under any of the leases at the
Properties has a right of first refusal to purchase the premises
demised under such lease.
(w) The Company and its subsidiaries
own, possess, license or have other rights to use, on reasonable
terms, all patents, patent applications, trade and service marks,
trade and service mark registrations, trade names, copyrights,
licenses, inventions, trade secrets, technology, know-how and other
intellectual property (collectively, the “Intellectual
Property”) reasonably necessary for the conduct of the
Company’s and the Operating Partnership’s business as
now conducted or as proposed in the Disclosure Package and the
Final Prospectus to be conducted. Except as set forth in the
Disclosure Package and the Final Prospectus; (i) to the
Company’s or the Operating Partnership’s best
knowledge, there is no material infringement by third parties of
any such Intellectual Property and (ii) there is no pending
or, to the Company’s or the Operating Partnership’s
best knowledge, threatened action, suit, proceeding or claim by
others that the Company or the Operating Partnership infringes or
otherwise violates any patent, trademark, copyright, trade secret
or other proprietary rights of others, and the Company is unaware
of any other fact which would form a reasonable basis for any such
claim.
(x) Neither the Company nor any
Subsidiary is in violation or default of (i) any provision of
its charter, bylaws or other organizational or governing documents,
(ii) the terms of any indenture, contract, lease, mortgage,
deed of trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which it is a
party or bound or to which its property is subject, or
(iii) any statute, law, rule, regulation, judgment, order or
decree of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having
jurisdiction over the Company or such Subsidiary or any of its
properties, as applicable, except, in the case of clauses
(ii) or (iii) above, for such violations or defaults
that, individually or in the aggregate, would not reasonably be
expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business.
(y) KPMG LLP, who have certified the
financial statements and supporting schedules incorporated by
reference in the Final Prospectus and delivered their reports with
respect to the audited financial statements and schedules
incorporated by reference in the Final Prospectus, are independent
registered public accountants within the meaning of the Act and the
applicable published rules and regulations thereunder.
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(z) The Company and each of its
Subsidiaries has filed all foreign, federal, state and local tax
returns that are required to be filed or has requested extensions
thereof (except in any case in which the failure so to file would
not reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business
or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the
Disclosure Package and the Final Prospectus (exclusive of any
supplement thereto)) and has paid all taxes required to be paid by
it and any other assessment, fine or penalty levied against it, to
the extent that any of the foregoing is due and payable, except for
any such tax, assessment, fine or penalty that is currently being
contested in good faith or as would not reasonably be expected to
have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business and
except as set forth in or contemplated in the Disclosure Package
and the Final Prospectus (exclusive of any supplement
thereto).
(aa) No material labor problem or
dispute with the employees of the Company or any of its
subsidiaries exists or is threatened or imminent.
(bb) The Company and each of its
Subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as
are prudent and customary in the businesses in which they are
engaged; all policies of insurance and fidelity or surety bonds
insuring the Company or any of its Subsidiaries or their respective
businesses, assets, employees, officers and directors are in full
force and effect; the Company and its subsidiaries are in
compliance with the terms of such policies and instruments in all
material respects; and there are no claims by the Company or any of
its Subsidiaries under any such policy or instrument as to which
any insurance company is denying liability or defending under a
reservation of rights clause; neither the Company nor any such
Subsidiary has been refused any insurance coverage sought or
applied for; and neither the Company nor any such Subsidiary has
any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary
to continue its business at a cost that would not reasonably be
expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Disclosure
Package and the Final Prospectus (exclusive of any supplement
thereto).
(cc) No Subsidiary of the Company is
currently prohibited, directly or indirectly, from paying any
dividends or distributions to the Company, from making any other
distribution on such Subsidiary’s capital stock or equity
interests, from repaying to the Company any loans or advances to
such subsidiary from the Company or from transferring any of such
Subsidiary’s property or assets to the Company or any other
subsidiary of the Company, except pursuant to the terms of any
indebtedness set forth in
11
or contemplated in the Disclosure
Package and the Final Prospectus (exclusive of any supplement
thereto).
(dd) The Company and its
subsidiaries possess all licenses, certificates, permits and other
authorizations issued by the appropriate federal, state or foreign
regulatory authorities necessary to conduct their respective
businesses, except for such licenses, certificates, permits and
other authorizations the absence of which, individually or in the
aggregate, would not reasonably be expected to have a material
adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business; and neither the
Company nor any such subsidiary has received any notice of
proceedings relating to the revocation or modification of any such
certificate, authorization or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would reasonably be expected to have a material adverse
effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set
forth in or contemplated in the Disclosure Package and the Final
Prospectus (exclusive of any supplement thereto).
(ee) The Company and each of its
subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that
(i) transactions are executed in accordance with
management’s general or specific authorizations;
(ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in
accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any
differences.
(ff) The Company has not taken,
directly or indirectly, any action designed to or that would
constitute or that would reasonably be expected to cause or result
in, under the Exchange Act or otherwise, stabilization or
manipulation of the price of any security of the Company to
facilitate the sale or resale of the Securities.
(gg) The Company and its
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 and are
in compliance with all permits, licenses or other approvals
required of them under applicable Environmental Laws to conduct
their respective businesses and (iii) have not received notice
of any actual or potential liability under any Environmental Laws,
except where such non-compliance with Environmental Laws, failure
to receive required permits, licenses or other approvals, or
liability would not, individually or in the aggregate, reasonably
be expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or
properties of the Company and its
12
subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Disclosure
Package and the Final Prospectus (exclusive of any supplement
thereto). Except as set forth in the Disclosure Package and the
Final Prospectus, neither the Company nor any of the subsidiaries
has been notified that it has been named as a “potentially
responsible party” under the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended.
Except as otherwise set forth in the Disclosure Package and the
Final Prospectus, and except as would not individually or in the
aggregate reasonably be expected to materially affect the value of
such Property or interfere in any material respect with the use
made and proposed to be made of such Property by the Company or any
subsidiary, to the knowledge of the Company and the Operating
Partnership, there have been no and are no (i) aboveground or
underground storage tanks; (ii) polychlorinated biphenyls
(“PCBs”) or PCB-containing equipment;
(iii) asbestos or asbestos containing materials;
(iv) lead based paints; (v) mold or other airborne
contaminants; or (vi) dry-cleaning facilities in, on, under,
or about any Property owned by the Company, the Operating
Partnership or their subsidiaries.
(hh) In the ordinary course of its
business, the Company periodically reviews the effect of
Environmental Laws on the business, operations and properties of
the Company and its subsidiaries, in the course of which it
identifies and evaluates associated costs and liabilities
(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). On the basis of such
review, the Company has reasonably concluded that such associated
costs and liabilities would not, singly or in the aggregate,
reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business
or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the
Disclosure Package and the Final Prospectus (exclusive of any
supplement thereto).
(ii) Neither the Company nor any of
its subsidiaries maintains or contributes to any “pension
plan” (within the meaning of Section 3(2) of the
Employee Retirement Income Security Act of 1974, as amended
(“ERISA”)) that is subject to Title IV of ERISA or any
“multiemployer plan” (within the meaning of
Section 4001(a)(3) of ERISA). Each “pension plan”
(within the meaning of Section 3(2) of ERISA) maintained by
the Company or any of its subsidiaries which is intended to be
qualified under Section 401(a) of the Internal Revenue Code of
1986, as amended (the “Code”), has received a favorable
determination or opinion letter from the Internal Revenue Service
that such plan is so qualified, and, to the knowledge of the
Company, nothing has occurred, whether by action or failure to act,
that could reasonably be expected to cause the loss of such
qualification. Neither the Company nor any of its subsidiaries
maintains or is required to contribute to a “welfare
plan” (as defined in Section 3(1) of ERISA) which
provides retiree or other post-employment welfare benefits or
insurance coverage (other than “continuation coverage”
(as defined in Section 602 of ERISA) or as
otherwise
13
required by applicable law). Each
“employee benefit plan” (within the meaning of
Section 3(3) of ERISA) established or maintained by the
Company and/or one or more of its subsidiaries is in compliance
with the currently applicable provisions of ERISA except for such
failures to comply that would not individually or in the aggregate
reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business
or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary
course of business.
(jj) There is and has been no
failure on the part of the Company and any of the Company’s
directors or officers, in their capacities as such, to comply with
any provision of the Sarbanes-Oxley Act of 2002 and the rules and
regulations promulgated in connection therewith (the
“Sarbanes-Oxley Act”), including Section 402
related to loans and Sections 302 and 906 related to
certifications, except for such failures to comply that would not
individually or in the aggregate reasonably be expected to have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business.
(kk) Neither the Company nor any of
its subsidiaries nor, to the knowledge of the Company, any
director, officer, agent, employee or affiliate of the Company or
any of its subsidiaries is aware of or has taken any action,
directly or indirectly, that would result in a violation by such
persons of the Foreign Corrupt Practices Act of 1977, as amended,
and the rules and regulations thereunder (“FCPA”),
including, without limitation, making use of the mails or any means
or instrumentality of interstate commerce corruptly in furtherance
of an offer, payment, promise to pay or authorization of the
payment of any money, or other property, gift, promise to give, or
authorization of the giving of anything of value to any
“foreign official” (as such term is defined in the
FCPA) or any foreign political party or official thereof or any
candidate for foreign political office, in contravention of the
FCPA and the Company, its subsidiaries and, to the knowledge of the
Company and the Operating Partnership, its affiliates have
conducted their businesses in compliance with the FCPA and have
instituted and maintain policies and procedures designed to ensure,
and which are reasonably expected to continue to ensure, continued
compliance therewith except for such violations or failures to
comply that would not individually or in the aggregate reasonably
be expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business.
(ll) The operations of the Company
and its subsidiaries are and have been conducted at all times in
compliance with applicable financial recordkeeping and reporting
requirements of the Currency and Foreign Transactions Reporting Act
of 1970, as amended, the money laundering statutes of all
jurisdictions, the rules and regulations thereunder and any related
or similar rules, regulations or guidelines, issued, administered
or enforced by any governmental agency (collectively, the
“Money Laundering Laws”) and no action, suit or
proceeding by or before any court or governmental agency, authority
or body or any arbitrator involving the Company or any of its
subsidiaries with
14
respect to the Money Laundering Laws
is pending or, to the best knowledge of the Company, threatened
except for such failures to comply, actions, suits or proceedings
that would not individually or in the aggregate reasonably be
expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business.
(mm) Except as would not
individually or in the aggregate reasonably be expected to have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, neither the
Company nor any of its subsidiaries nor, to the knowledge of the
Company, any director, officer, agent, employee or affiliate of the
Company or any of its subsidiaries is currently subject to any U.S.
sanctions administered by the Office of Foreign Assets Control of
the U.S. Treasury Department (“OFAC”); and the Company
will not directly or indirectly use the proceeds of the offering,
or lend, contribute or otherwise make available such proceeds to
any subsidiary, joint venture partner or other person or entity,
for the purpose of financing the activities of any person currently
subject to any U.S. sanctions administered by OFAC.
(nn) Except as set forth in the
Disclosure Package and the Final Prospectus, the Company and its
subsidiaries have good and marketable title to all personal
property owned by them, free and clear of all encumbrances and
defects; and all personal property held under lease by the Company
or any subsidiary is held by it under valid, subsisting and
enforceable leases, in each case, with such exceptions as are not
material and do not interfere with the use made and proposed to be
made of such property by the Company or the subsidiary.
(oo) No relationship, direct or
indirect, exists between or among the Company on the one hand, and
the directors, offi
