3,700,000 Shares
SL GREEN REALTY
CORP.
Common Stock
UNDERWRITING
AGREEMENT
November 30, 2006
Lehman Brothers Inc.
745 Seventh Avenue
New York, New York 10019
Ladies and Gentlemen:
SL Green Realty Corp., a
Maryland corporation (the “ Company ”), which
qualifies for federal income tax purposes as a real estate
investment trust pursuant to Sections 856 through 860 of the
Internal Revenue Code of 1986, as amended, including the
regulations and published interpretations thereunder (the “
Code ”), and SL Green Operating Partnership,
L.P., a Delaware limited partnership the sole general partner of
which is the Company (the “ Operating Partnership
” and together with the Company, the “ Transaction
Entities ”) each wish to confirm as follows its agreement
with Lehman Brothers Inc. (the “ Underwriter ”),
with respect to (i) the sale by the Company and the purchase by the
Underwriter (the “ Offering ”), of an aggregate
of 3,700,000 shares of the Company’s common stock, par value
$0.01 per share (“ Common Stock ”); and (ii) the
grant by the Company to the Underwriter of the option described in
Section 2(b) hereof to purchase all or any part of 555,000
additional shares of Common Stock. The 3,700,000 shares of
Common Stock to be purchased by the Underwriter (the “
Initial Shares ”) and all or any part of the 555,000
shares of Common Stock subject to the option described in Section
2(b) hereof (the “ Option Shares ”) are
hereinafter called, collectively, the “ Shares
.”
Capitalized terms used but not
otherwise defined herein shall have the meanings ascribed to them
in the Prospectus (as hereinafter defined).
The Transaction Entities understand
that the Underwriter proposes to make a public offering of the
Shares as soon as the Underwriter deems advisable after this
Agreement has been executed and delivered.
1.
Representations, Warranties and Agreements of the Transaction
Entities . Each of the Transaction Entities, jointly and
severally, represents, warrants and agrees that, as of the date
hereof and as of the Closing Date (as hereinafter defined)
:
(a)
The Company has prepared and filed with the Securities and Exchange
Commission (the “ Commission ”) a registration
statement on Form S-3 (File No. 333-138976), including a
prospectus, relating to, among other securities, the Shares and the
offering thereof from time to time in accordance with Rule 415
under the United States Securities Act of 1933, as amended (the
“ Securities Act ”). Such registration
statement has become effective under the Securities Act. As used in
this Agreement:
(i)
“ Applicable Time ” means 9:00 a.m. (New York
City time) on the date of this Agreement;
(ii)
“ Effective Date ” means any date as of which
any part of such Registration Statement (as defined below) relating
to the Shares became, or is deemed to have become, effective under
the Securities Act in accordance with the rules and regulations
(the “ Securities Act Regulations ”) of the
Commission thereunder;
(iii)
“ Issuer Free Writing Prospectus ” means each
“free writing prospectus” (as defined in Rule 405 of
the Securities Act Regulations) prepared by or on behalf of the
Company or used or referred to by the Company in connection with
the offering of the Shares;
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(iv)
“ Preliminary Prospectus ” means any preliminary
prospectus relating to the Shares included in such registration
statement or filed with the Commission pursuant to Rule 424(b) of
the Securities Act Regulations, including any preliminary
prospectus supplement thereto relating to the Shares, if
applicable;
(v)
“ Disclosure Package ” means, as of the
Applicable Time, (i) the base prospectus then filed as part of the
Registration Statement as supplemented by the most recent form of
preliminary prospectus supplement, if any, (ii) each Issuer Free
Writing Prospectus, if any, identified in Schedule II
attached hereto, and (iii) the information set forth in Schedule
IV hereto;
(vi)
“ Prospectus ” means the final prospectus
relating to the Shares, including any prospectus supplement thereto
relating to the Shares, as filed with the Commission pursuant to
Rule 424(b) of the Securities Act Regulations; and
(vii)
“ Registration Statement ” means, collectively,
the various parts of such registration statement, each as amended
as of the Effective Date for such part, including any Preliminary
Prospectus or the Prospectus and all exhibits to such registration
statement.
Any reference to the base prospectus
filed as part of the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and
include any documents incorporated by reference therein pursuant to
Item 12 of Form S-3 under the Securities Act. Any reference
to the “ most recent Preliminary Prospectus ”
shall be deemed to refer to the latest Preliminary Prospectus
included in the Registration Statement or filed pursuant to Rule
424(b) prior to or on the date hereof. Any reference to any
amendment or supplement to the Registration Statement, any
Preliminary Prospectus or the Prospectus shall be deemed to refer
to and include any document filed under the Securities Exchange Act
of 1934, as amended (the “ Exchange Act ”),
after the date of such Preliminary Prospectus or the Prospectus, as
the case may be, and incorporated by reference in the Registration
Statement, such Preliminary Prospectus or the Prospectus, as the
case may be.
All references in this Agreement to
financial statements and schedules and other information which is
“contained,” “included” or
“stated” in the Registration Statement, any Preliminary
Prospectus or the Prospectus (or other references of like import)
shall be deemed to mean and include all such financial statements
and schedules and other information which are incorporated by
reference in the Registration Statement, any Preliminary Prospectus
or the Prospectus, as the case may be, at or prior to the date of
this Agreement.
For purposes of this Agreement, all
references to the Registration Statement, any Preliminary
Prospectus, any Issuer Free Writing Prospectus or the Prospectus or
any amendment or supplement to any of the foregoing shall be deemed
to include the copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval system (“
EDGAR ”).
The term “ Subsidiary
” means a corporation, partnership or limited liability
company, a majority of the outstanding voting or economic interests
of which are owned or controlled, directly or indirectly, by the
Company, the Operating Partnership, or by one or more other
Subsidiaries of the Company or the Operating Partnership, but not
including the Joint Venture Entities (as defined below). One Park
Realty Corp, MSSG Realty Partners I, LLC, MSSG Realty Partners II,
LLC, MSSG Realty Partners III, LLC, 1250 Broadway Realty Corp.,
1515 Broadway Realty Corp., Green 19W44 JV LLC, Green 485 Member
LLC, 485 Lexington JV LLC, 1 Madison Office Holdings LLC, 609
Partners, LLC are each a “ Joint Venture Entity
,” and together, the “ Joint Venture Entities
.”
(b)
The Company meets the requirements for use of Form S-3 under the
Securities Act as of the applicable Effective Date of the
Registration Statement and any amendment thereto, as of the
applicable filing date of the Prospectus Supplement and any
amendments thereto and as of the Closing Date (as defined in
Section 4(a)) and each Date of Delivery (as defined in Section
2(b)), if any. The Registration Statement was filed not
earlier than the date that is three years prior to the Closing
Date.
(c)
(i) At the time of filing of 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 Securities
Act (whether such amendment was by post-effective amendment,
incorporated report filed pursuant to Section 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) of the Securities Act)
made
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any offer relating to the Shares in
reliance on the exemption of Rule 163 of the Securities Act and
(iv) as of the Applicable Time, the Company was and is a
“well-known seasoned issuer” as defined in Rule 405 of
the Securities Act. The Registration Statement is an
“automatic shelf registration statement,” as defined in
Rule 405 of the Securities Act and the Shares, since their
registration on the Registration Statement, have been and remain
eligible for registration by the Company on an “automatic
shelf registration statement.” The Company has not received
from the Commission any notice pursuant to Rule 401(g)(2) of the
Securities Act objecting to the use of the automatic shelf
registration statement form. At (i) 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 Act) of the Shares and (ii) the
date hereof, the Company was not and is not an “ineligible
issuer” as defined in Rule 405 of the Securities Act,
including the Company or any subsidiary in the preceding three
years not having been convicted of a felony or misdemeanor or
having been made the subject of a judicial or administrative decree
or order as described in Rule 405 of the Securities Act.
(d)
As of (i) the time of filing the Registration Statement and (ii)
the Applicable 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 of
the Securities Act Regulations), without taking account of any
determination by the Commission pursuant to Rule 405 of the
Securities Act Regulations that it is not necessary that the
Company be considered an “ineligible
issuer.”
(e)
The Registration Statement conformed and will conform in all
material respects on the Effective Date, on the date hereof, on the
Closing Date and on each Date of Delivery (if any), and any
amendment to the Registration Statement filed after the date hereof
will conform in all material respects when filed, to the
requirements of the Securities Act and the Securities Act
Regulations. The Preliminary Prospectus, if any, conformed,
and the Prospectus will conform, in all material respects when
filed with the Commission pursuant to Rule 424(b) on the Closing
Date and on any applicable Date of Delivery, if such date is not
the Closing Date, to the requirements of the Securities Act and the
Securities Act Regulations. The Registration Statement did
not, as of the Effective Date or on the date hereof, contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading; and the Prospectus will not, as
of its date and on the Closing Date and on the applicable Date of
Delivery (if any), contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
provided that no representation or warranty is made as to
information contained in or omitted from the Registration Statement
or the Prospectus in reliance upon and in conformity with written
information furnished to the Company by the Underwriter
specifically for inclusion therein. The Transaction Entities
acknowledge that the only information furnished in writing to the
Company by the Underwriter specifically for inclusion in the
Registration Statement or any Prospectus is the information set
forth in Exhibit A hereto.
(f)
The documents incorporated by reference or deemed to be
incorporated in any Preliminary Prospectus, the Disclosure Package
or the Prospectus pursuant to Item 12 of the Registration Statement
on Form S-3 under the Securities Act, at the time they were or
hereafter are filed with the Commission, complied in all material
respects with the requirements of the Exchange Act, and the rules
and regulations of the Commission thereunder (the “
Exchange Act Regulations ”) and, when read together
and with the other information in the Prospectus, as of the
applicable Effective Times of the Registration Statement and any
amendment thereto, did not and will not contain an untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading.
(g)
No stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued and no proceeding for
that purpose has been instituted or, to the knowledge of any of the
Transaction Entities, threatened by the Commission or by the state
securities authority of any jurisdiction. No order preventing
or suspending the use of any Preliminary Prospectus, the Disclosure
Package or the Prospectus has been issued and no proceeding for
that purpose has been instituted or, to the knowledge of any of the
Transaction Entities, threatened by the Commission or by the state
securities authority of any jurisdiction.
(h)
The Disclosure Package did not, as of the Applicable Time, contain
any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading, except that the price of the
Shares and disclosures directly relating thereto will be included
in
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the Prospectus; provided that
no representation or warranty is made as to information contained
in or omitted from the Disclosure Package in reliance upon and in
conformity with written information furnished to the Company by the
Underwriter specifically for inclusion therein, which information
is specified in Exhibit A .
(i)
Each Issuer Free Writing Prospectus does not include any
information that conflicts with the information contained in the
Registration Statement, including any document incorporated by
reference therein that has not been superseded or modified,
provided that no representation or warranty is made as to
information contained in or omitted from the Disclosure Package in
reliance upon and in conformity with written information furnished
to the Company by the Underwriter specifically for inclusion
therein, which information is specified in Exhibit A
.
(j)
Each Issuer Free Writing Prospectus, when considered together with
the Disclosure Package as of the Applicable Time, did not contain
an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which
they were made, not misleading, except that the price of the Shares
and disclosures directly relating thereto will be included in the
Prospectus.
(k)
Each Issuer Free Writing Prospectus conformed or will conform in
all material respects to the requirements of the Securities Act and
the Securities Act Regulations on the date of first use, and the
Company has complied with any filing requirements applicable to
such Issuer Free Writing Prospectus pursuant to the Securities Act
Regulations. The Company has not made any offer relating to
the Shares that would constitute an Issuer Free Writing Prospectus
without the prior written consent of the Underwriter. The
Company has retained in accordance with the Securities Act
Regulations all Issuer Free Writing Prospectuses that were not
required to be filed pursuant to the Securities Act
Regulations.
(l)
The Company has been duly formed and is validly existing as a
corporation in good standing under the laws of the State of
Maryland, is duly qualified to do business and is in good standing
as a foreign corporation in each jurisdiction in which its
ownership or lease of property and other assets or the conduct of
its business requires such qualification, except where the failure
to so qualify will not have a material adverse effect on the
condition, financial or otherwise, business, prospects, operations,
management, consolidated financial position, net worth,
stockholders’ equity or results of operations of the
Transaction Entities, the Subsidiaries and the Joint Venture
Entities considered as one enterprise or on the use or value of the
Properties (as hereinafter defined) as a whole (collectively, a
“ Material Adverse Effect ”), and has all power
and authority necessary to own, lease and operate its properties
and other assets, to conduct the business in which it is engaged,
and to enter into and perform its obligations under this Agreement
to which it is a party.
(m)
The Company has an authorized capitalization as set forth in each
of the Disclosure Package and the Prospectus, and all of the issued
capital stock (other than the Shares) have been duly and validly
authorized and issued, are fully paid and non-assessable, have been
offered and sold in compliance with all applicable laws (including,
without limitation, federal or state securities laws) and not in
violation of the preemptive or other similar rights of any security
holder of the Company, and conform to the description thereof
contained in each of the Disclosure Package and the
Prospectus. Except as disclosed in the Disclosure Package and
the Prospectus, (i) no shares of capital stock of the Company are
reserved for any purpose, (ii) except for the equity interests in
the Operating Partnership (“ Units ”), there are
no outstanding securities convertible into or exchangeable for any
shares of capital stock of the Company, and (iii) there are no
outstanding options, rights (preemptive or otherwise) or warrants
to purchase or subscribe for shares of capital stock or any other
securities of the Company.
(n)
The Operating Partnership has been duly formed and is validly
existing as a limited partnership in good standing under the laws
of the State of Delaware, is duly qualified to do business and is
in good standing as a foreign limited partnership in each
jurisdiction in which its ownership or lease of property and other
assets or the conduct of its business requires such qualification,
except where the failure to so qualify will not have a Material
Adverse Effect, and has all power and authority necessary to own,
lease and operate its properties and other assets, to conduct the
business in which it is engaged and to enter into and perform its
obligations under this Agreement to which it is a party. The
Company is the sole general partner of the Operating
Partnership. The Agreement of Limited Partnership of the
Operating Partnership, as amended (the “ Operating
Partnership Agreement ”) is in full force and effect, and
the aggregate percentage interests of the Company and outside
limited partners in the Operating Partnership are as set forth in
each of the Disclosure Package and the Prospectus.
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(o)
All issued and outstanding Units have been duly authorized and
validly issued and have been offered and sold or exchanged in
compliance in all material respects with all applicable laws
(including, without limitation, federal or state securities
laws). Except as disclosed in the Disclosure Package and the
Prospectus, no Units are reserved for any purpose and there are no
outstanding securities convertible into or exchangeable for any
Units and no outstanding options, rights (preemptive or otherwise)
or warrants to purchase or subscribe for Units or other securities
of the Operating Partnership. The terms of the Units conform
in all material respects to statements and descriptions related
thereto contained in each of the Disclosure Package and the
Prospectus.
(p)
The Operating Partnership is the only Subsidiary that is a “
significant subsidiary ” of the Company (as such term
is defined in Rule 1-02 of Regulation S-X). The only
Subsidiaries of the Company are (a) the Subsidiaries listed in
Exhibit 21 to the Form 10-K and (b) certain other Subsidiaries
which, considered in the aggregate as a single Subsidiary, do not
constitute a “ significant subsidiary ” as
defined in Rule 1-02 of Regulation S-X.
(q)
The Shares have been duly and validly authorized for issuance and
sale to the Underwriter and, when issued and delivered against
payment therefor as provided herein, will be duly and validly
issued, fully paid and non-assessable. Upon payment of the
purchase price and delivery of the Shares in accordance herewith,
the Underwriter will receive good, valid and marketable title to
the Shares, free and clear of all security interests, mortgages,
pledges, liens, encumbrances, claims, restrictions and
equities. The Shares conform in all material respects to all
statements and descriptions related thereto contained in the
Disclosure Package and the Prospectus. The form of the
certificates to be used to evidence the Shares will, at the Closing
Date and on the applicable Date of Delivery, be in due and proper
form and will comply with all applicable legal requirements and
will be in substantially the form filed or incorporated by
reference, as the case may be, as an exhibit to the Registration
Statement. The issuance of the Shares is not subject to any
preemptive or other similar rights.
(r)
(A) This Agreement has been duly and validly authorized,
executed and delivered by each of the Transaction Entities; (B) the
Operating Partnership Agreement has been duly and validly
authorized, executed and delivered by the parties thereto and is a
valid and binding agreement of the Company, enforceable against the
Company 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; (C)
each of the limited liability operating agreements,
stockholders’ agreements or similar joint venture agreements
of the Joint Venture Entities (the “ Joint Venture
Agreements ”) has been duly and validly authorized,
executed and delivered by the parties thereto and is a valid and
binding agreement of the Company, enforceable against the Company
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; and (D) none of
the Transaction Entities or any Subsidiary that holds any interest
in any of the Joint Venture Entities is in default under any of the
Joint Venture Agreements nor, to the knowledge of the Transaction
Entities, is any third-party holder of interests in any of the
Joint Venture Entities in default under any of the Joint Venture
Agreements.
(s)
Each of (i) the Agreement and Plan of Merger, dated August 3, 2006,
by and among Wyoming Acquisition Corp., Wyoming Acquisition GP LLC
and Wyoming Acquisition Partnership LP (collectively, the “
Reckson Entities ”), the Transaction Entities and SL
Green Associates Realty Corp. (“ SL Green Associates
”), filed as Exhibit 2.1 to the Company’s Current
Report on Form 8-K filed with the Commission on August 9, 2006
(the “ Reckson Merger Agreement ”) and (ii) the
four asset purchase agreements between the Company and New Venture
MRE LLC and one asset purchase agreement between the Company
and RA Core Plus LLC, in each case dated October 13,
2006, together with the letter agreement dated the same date among
the Company, Scott H. Rechler, Michael Maturo, Jason M. Barnett and
RA Core Plus LLC (clause (i) and clause (ii) collectively, the
“ Reckson Agreements ”), has been duly
authorized, executed and delivered by the Transaction Entities and
SL Green Associates, and constitutes a valid and legally binding
agreement of the Transaction Entities and SL Green Associates
enforceable in accordance with their 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.
Compliance by the Transaction Entities and SL Green Associates with
their
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respective obligations under the
Reckson Agreements does not conflict with or constitute a breach
of, or default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the
Transaction Entities, SL Green Associates or any of their
Subsidiaries pursuant to, any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Transaction
Entities, SL Green Associates or any of their Subsidiaries are a
party or by which they may be bound or to which any of the property
or assets of the Transaction Entities, SL Green Associates or any
of their Subsidiaries is subject, except for any such conflict,
breach or default that would not have a Material Adverse Effect,
nor will such action result in any violation of the provisions of
the charter or bylaws of the Company or the Operating Partnership
Agreement or, to the best of the Company’s knowledge, any
law, administrative regulation or administrative or court order or
decree. No consent, approval, authorization or order of any court
or governmental authority or agency is required for the
consummation by the Transaction Entities and SL Green Associates of
the transactions contemplated by the Reckson Agreements, except
such as has been obtained or are contemplated. Statements included
or incorporated by reference in the Disclosure Package and the
Prospectus relating to the Reckson Agreements and the transactions
contemplated thereby are correct in all material respects. None of
the Transaction Entities is in default under the Reckson Agreements
nor, to the actual knowledge of the Transaction Entities, are any
of the Reckson Entities in default under the Reckson
Agreements.
(t)
All of the mezzanine loans of which the Company is the owner,
directly or indirectly (the “ Mezzanine Loans
”), and all of the participation interests in loans of which
the Company is the owner, directly or indirectly (the “
Participation Interests ,” and such loans, together
with the Mezzanine Loans, collectively are referred to hereinafter
as the “ Loans ”), are set forth or described in
the Prospectus. The Company is the sole owner and holder of
the Mezzanine Loans and Participation Interests. To the
Company’s knowledge, there is no offset, defense,
counterclaim or right to rescission with respect to any of the
notes or any of the other loan documents.
(u)
The execution, delivery and performance of this Agreement by each
of the Transaction Entities and the consummation of the
transactions contemplated hereby and thereby (A) do not and
will not conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute (with or without the
giving of notice or the passage of time, or both) a default (or
give rise to any right of termination, redemption, repurchase,
cancellation or acceleration) under any of the terms, conditions or
provisions of any note, bond, indenture, mortgage, deed of trust,
lease, license, contract, loan agreement or other agreement or
instrument to which any of the Transaction Entities is a party
(including, without limitation, the Reckson Agreements) or by which
any of the Transaction Entities is bound or to which any of the
Properties or other assets of any of the Transaction Entities is
subject, (B) will not result in any violation of any of the
provisions of the charter, by-laws, certificate of limited
partnership, agreement of limited partnership or other
organizational document of any of the Transaction Entities or Joint
Venture Entities, or (C) will not result in any violation of
any statute or any order, writ, injunction, decree, rule or
regulation of any court or governmental agency or body having
jurisdiction over any of the Transaction Entities, Subsidiaries,
Joint Venture Entities or any of the Properties, except, with
respect to subsections (A) and (C), for any such breach or
violation that would not have a Material Adverse Effect.
Except for such consents, approvals, authorizations, registrations
or qualifications as may be required under the Exchange Act, by the
New York Stock Exchange, Inc. (“ NYSE ”), or by
the National Association of Securities Dealers, Inc. (“
NASD ”), and applicable state securities laws in
connection with the purchase and distribution of the Shares by the
Underwriter, no consent, approval, authorization or order of, or
filing or registration with, any such court or governmental agency
or body is required for the execution, delivery and performance of
this Agreement by the Transaction Entities and the consummation of
the transactions contemplated hereby and thereby.
(v)
Except as disclosed in the Disclosure Package and the Prospectus,
there are no contracts, agreements or understandings between the
Company and any person granting such person the right to require
the Company to file a registration statement under the Securities
Act with respect to any securities of the Company owned or to be
owned by such person or to require the Company to include such
securities in the securities registered pursuant to the
Registration Statement or in any securities being registered
pursuant to any other registration statement filed by the Company
under the Securities Act.
(w)
Except as described in the Disclosure Package and the Prospectus,
no Transaction Entity has sold or issued any securities during the
six-month period preceding the date of the Prospectus, including
any sales pursuant to Rule 144A under, or Regulations D or S
of, the Securities Act,
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other than shares issued pursuant to
employee benefit plans, qualified stock options plans or other
employee compensation plans or pursuant to outstanding options,
rights or warrants, that would be required to be integrated with
the sale of the Shares.
(x)
Except as would not have a Material Adverse Effect, none of the
Company, Subsidiaries, Joint Venture Entities or Properties has
sustained, since the date of the latest financial statements
included in the Disclosure Package and the Prospectus, any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, other
than as set forth or contemplated in the Disclosure Package and the
Prospectus; and, since the date of the latest financial statements
included in the Disclosure Package and the Prospectus, there has
not been any change in the capital stock or long-term debt of any
of the Transaction Entities or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting any of the Properties or the condition, financial or
otherwise, business, prospects, operations, management, financial
position, net worth, stockholders’ equity or results of
operations of the Transaction Entities, Subsidiaries and Joint
Venture Entities considered as one enterprise or use or value of
the Properties as a whole, other than as set forth or contemplated
in the Disclosure Package and the Prospectus.
(y)
The financial statements (including the related notes and
supporting schedules) of (A) the Company included in, or
incorporated by reference into, the Registration Statement, the
Prospectus or the Disclosure Package (i) present fairly the
financial condition, the results of operations, the statements of
cash flows and the statements of stockholders’ equity and
other information purported to be shown thereby of the Company and
its consolidated Subsidiaries, at the dates and for the periods
indicated and (ii) have been prepared in conformity with
generally accepted accounting principles applied on a consistent
basis throughout the periods involved, and (B) Reckson Associates
Realty Corp. (“ Reckson ”), included in, or
incorporated by reference into, the Registration Statement, the
Prospectus or the Disclosure Package (i) present fairly the
financial condition, the results of operations, the statements of
cash flows and the statements of stockholders’ equity and
other information purported to be shown thereby of Reckson and its
consolidated subsidiaries, at the dates and for the periods
indicated and (ii) have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis
throughout the periods involved. The summary and selected financial
data included in the Disclosure Package and the Prospectus present
fairly the information shown therein as at the respective dates and
for the respective periods specified, and the summary and selected
financial data have been presented on a basis consistent with the
financial statements so set forth in the Disclosure Package and the
Prospectus and other financial information. Pro forma
financial information included in the Disclosure Package and the
Prospectus has been prepared in accordance with the applicable
requirements of the Securities Act Regulations with respect to pro
forma financial information and includes all adjustments necessary
to present fairly the pro forma financial position of the Company
at the respective dates indicated and the results of operations for
the respective periods specified. No other financial
statements (or schedules) of the Company, any predecessor of the
Company, Reckson or any predecessor of Reckson, as applicable, are
required by the Securities Act to be included in the Registration
Statement, the Prospectus or the Disclosure Package. The
other financial statistical information and data included in, or
incorporated by reference in, the Disclosure Package or the
Prospectus, historical and pro forma , have been derived
from the financial records of the Company (or its predecessors) or
Reckson (or its predecessors), as applicable, and, in all material
respects, have been prepared on a basis consistent with such books
and records of the Company (or its predecessor) or Reckson (or its
predecessors), as applicable.
(z)
Ernst & Young LLP, who have certified the financial
statements and supporting schedules included in, or incorporated by
reference into, the Registration Statement, the Prospectus and the
Disclosure Package, (A) whose reports appear in (i) the
Company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2005 (“ Form 10-K ”), and
(ii) Reckson’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2005, both of which are incorporated by
reference into the Prospectus, and (B) and who have delivered the
initial letters referred to in Section 8(g) and Section 8(i)
hereof, are, and during the periods covered by such reports, were,
independent public accountants as required by the Securities Act
and the Securities Act Regulations.
(aa)
(A) The
Operating Partnership, directly or indirectly, or any Joint Venture
Entity in which any of the Company or the Operating Partnership,
directly or indirectly, owns an interest, as the case may be, has
good and marketable title fee or leasehold, as the case may be, to
each of the
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interests in the Properties and the
other assets described in the Disclosure Package and the Prospectus
as being directly or indirectly owned by the Operating Partnership
or the applicable Joint Venture Entity, respectively, (the “
Properties ”), in each case free and clear of all
liens, encumbrances, claims, security interests and defects, other
than those referred to in the Disclosure Package and the Prospectus
or those which would not have a Material Adverse Effect;
(B) all liens, charges, encumbrances, claims or restrictions
on or affecting any of the Properties and the assets of any
Transaction Entity, Subsidiaries or Joint Venture Entity which are
required to be disclosed in the Disclosure Package or the
Prospectus are disclosed therein; (C) except as otherwise
described in the Disclosure Package and the Prospectus, none of the
Transaction Entities, Subsidiaries or Joint Venture Entities or any
tenant of any of the Properties is in default under (i) any space
leases (as lessor or lessee, as the case may be) relating to the
Properties, (ii) any of the mortgages or other security documents
or other agreements encumbering or otherwise recorded against the
Properties, or (iii) any ground lease, sublease or operating
sublease relating to any of the Properties, and no Transaction
Entity knows of any event which, but for the passage of time or the
giving of notice, or both, would constitute a default under any of
such documents or agreements except with respect to (i), (ii) and
(iii) immediately above any such default that would not have a
Material Adverse Effect; (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; (E) to the knowledge of any
of the Transaction Entities, 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 for such
failures to comply that would not have a Material Adverse Effect;
and (F) no Transaction Entity has knowledge of any pending or
threatened condemnation proceedings, zoning change or other
proceeding or action that will in any material manner affect the
size of, use of, improvements on, construction on or access to the
Properties.
(bb)
The mortgages and deeds of trust which encumber the Properties are
not convertible into equity securities of the entity owning such
Property and said mortgages and deeds of trust are not
cross-defaulted or cross-collateralized with any property other
than other Properties.
(cc)
The Operating Partnership, directly or indirectly, has obtained
title insurance on the fee or leasehold interests, as the case may
be, in each of the Properties, in an amount at least equal to the
greater of (a) the mortgage indebtedness of each such Property
or (b) the purchase price of each such Property.
(dd)
Except as disclosed in the Disclosure Package and the Prospectus or
would not result in a Material Adverse Effect: (A) to
the knowledge of the Transaction Entities, the operations of the
Transaction Entities, the Joint Venture Entities and the Properties
are in compliance with all Environmental Laws (as defined below)
and all requirements of applicable permits, licenses, approvals and
other authorizations issued pursuant to Environmental Laws;
(B) to the knowledge of the Transaction Entities, none of the
Transaction Entities, any Joint Venture Entity or any Property has
caused or suffered to occur any Release (as defined below) of any
Hazardous Substance (as defined below) into the Environment (as
defined below) on, in, under or from any Property, and no condition
exists on, in, under or adjacent to any Property that could result
in the incurrence of liabilities under, or any violations of, any
Environmental Law or give rise to the imposition of any Lien (as
defined below), under any Environmental Law; (C) none of the
Transaction Entities or any Joint Venture Entity has received any
written notice of a claim under or pursuant to any Environmental
Law or under common law pertaining to Hazardous Substances on, in,
under or originating from any Property; (D) none of the
Transaction Entities has actual knowledge of, or received any
written notice from any Governmental Authority (as defined below)
claiming any violation of any Environmental Law or a determination
to undertake and/or request the investigation, remediation,
clean-up or removal of any Hazardous Substance released into the
Environment on, in, under or from any Property; and (E) no
Property is included or, to the knowledge of the Transaction
Entities, proposed for inclusion on the National Priorities List
issued pursuant to CERCLA (as defined below) by the United States
Environmental Protection Agency (the “ EPA ”) or
on the Comprehensive Environmental Response, Compensation, and
Liability Information System database maintained by the EPA, and
none of the Transaction Entities has actual knowledge that any
Property has otherwise been identified in a published writing by
the EPA as a potential CERCLA removal, remedial or response site
or, to the knowledge of the Transaction Entities, is included on
any similar list of potentially contaminated sites pursuant to any
other Environmental Law.
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