Exhibit 1.1
SENIOR HOUSING PROPERTIES
TRUST
6,000,000 Shares of Beneficial
Interest
($0.01 par value per Share)
UNDERWRITING AGREEMENT
February 7, 2007
UNDERWRITING AGREEMENT
February 7, 2007
UBS Securities LLC
Morgan Stanley & Co. Incorporated
Merrill Lynch, Pierce, Fenner &
Smith
Incorporated
RBC Capital Markets Corporation
Wachovia Capital Markets, LLC
Ferris, Baker Watts, Incorporated
Janney Montgomery Scott LLC
Morgan Keegan & Company, Inc.
Oppenheimer & Co. Inc.
Raymond James and Associates, Inc.
Stifel, Nicolaus & Company,
Incorporated
As
Managing Underwriters
c/o UBS Securities LLC
299 Park Avenue
New York, New York 10171-0026
c/o Morgan Stanley & Co.
Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
Senior Housing Properties Trust, a
real estate investment trust organized under the laws of the State
of Maryland (the “Company”), proposes to issue and sell
to the underwriters named in Schedule A annexed hereto (the
“Underwriters”) an aggregate of 6,000,000 common shares
(the “Firm Shares”) of beneficial interest, $0.01 par
value (the “Common Shares”) of the Company. In
addition, solely for the purpose of covering over-allotments, the
Company proposes to grant to the Underwriters the option to
purchase up to an additional 900,000 Common Shares (the
“Additional Shares”). The Firm Shares and the
Additional Shares are hereinafter collectively sometimes referred
to as the “Shares.” The Shares are described in the
Prospectus which is referred to below.
The Company has prepared and filed
with the Securities and Exchange Commission (the
“Commission”), in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations
of the Commission thereunder (collectively, the “Act”),
a registration statement (File No. 333-135716) on Form S-3 under
the Act (the “shelf registration statement”), including
a prospectus relating to, among other things, Common Shares,
preferred shares of beneficial interest, depository shares,
guarantees, debt securities and warrants for such securities of the
Company, and such amendments to such registration statement, as may
have been required prior to the
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date hereof, have been similarly
prepared and have been filed with the Commission. Such shelf
registration statement, as so amended, and any post-effective
amendments thereto, have become effective under the Act.
The Company will next file with the
Commission pursuant to Rule 424(b) under the Act a final prospectus
supplement to the basic prospectus included in the shelf
registration statement, as so amended, describing the Shares and
the offering thereof, in such form as has been provided to or
discussed with, and approved by, the Underwriters.
Except where the context otherwise
requires, the term “Registration Statement” as used in
this Agreement means the shelf registration statement, as amended
at the time it became effective for purposes of Section 11 of the
Act, as such section applies to the respective Underwriters (the
“Effective Time”), including (i) all documents filed as
part thereof or incorporated by reference or deemed to be
incorporated by reference therein and (ii) any information
contained or incorporated by reference in a prospectus filed with
the Commission pursuant to Rule 424(b) under the Act, to the extent
such information is deemed, pursuant to Rule 430A, Rule 430B or
Rule 430C under the Act, to be part of the registration statement
at the Effective Time. If an abbreviated registration
statement is prepared and filed with the Commission in accordance
with Rule 462(b) under the Act (an “Abbreviated Registration
Statement”), the term “Registration Statement”
includes the Abbreviated Registration Statement. Any such
Abbreviated Registration Statement shall be filed by the Company
with the Commission and become effective no later than 10:00 P.M.,
New York City time, on the date of determination of the public
offering price for the Shares.
Except where the context otherwise
requires, the term “Basic Prospectus” as used in this
Agreement means the prospectus dated July 12, 2006, as filed with
the Commission pursuant to Rule 424(b) and included in the shelf
registration statement. Except where the context otherwise
requires, the term “Prepricing Prospectus” as used in
this Agreement means each preliminary form of the Prospectus (as
defined herein) subject to completion, if any, used in connection
with the offering of the Shares. Except where the context
otherwise requires, the term “Prospectus Supplement” as
used in this Agreement means any final prospectus supplement
specifically relating to the Shares, in the form filed with, or
transmitted for filing to, the Commission pursuant to Rule 424
under the Act. Except where the context otherwise requires,
the term “Prospectus” as used in this Agreement means
the Basic Prospectus together with the Prospectus Supplement,
except that if such Basic Prospectus is amended or supplemented on
or prior to the date on which the Prospectus Supplement was first
filed pursuant to Rule 424, the term “Prospectus” shall
refer to the Basic Prospectus as so amended or supplemented and as
supplemented by the Prospectus Supplement.
“Permitted Free Writing
Prospectuses,” as used herein, means the documents listed on
Schedule B attached hereto and each “road show” (as
defined in Rule 433 under the Act), if any, related to the offering
of the Shares contemplated hereby that is a “written
communication” (as defined in Rule 405 under the Act) (each
such road show, a “Road Show”).
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“Disclosure Package,” as
used herein, means the Basic Prospectus, including without
limitation the documents incorporated by reference therein as of
the time this agreement is entered into, together with any
Prepricing Prospectus and any combination of one or more of the
Permitted Free Writing Prospectuses, if any.
Any reference in this Agreement to
the shelf registration statement, the Registration Statement, the
Basic Prospectus, any Prepricing Prospectus, any Prospectus
Supplement, the Prospectus or any Permitted Free Writing Prospectus
shall be deemed to refer to and include the documents incorporated
by reference therein, in each case as amended (as amended, the
“Incorporated Documents”), including, unless the
context otherwise requires, the documents, if any, filed as
exhibits to such Incorporated Documents. Any reference in
this Agreement to the term “amend,”
“amendment” or “supplement” with respect to
the shelf registration statement, the Registration Statement, the
Basic Prospectus, any Prepricing Prospectus, any Prospectus
Supplement, any Prospectus or any Permitted Free Writing Prospectus
shall be deemed to refer to and include any documents filed under
the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), on or after the initial effective date
of the Registration Statement, or the date of such Basic
Prospectus, such Prepricing Prospectus, the Prospectus Supplement,
the Prospectus or such Permitted Free Writing Prospectus, as the
case may be, and deemed to be incorporated therein by
reference.
The Company and the Underwriters
agree as follows:
1.
Sale and Purchase . Upon the basis of the
representations and warranties and subject to the terms and
conditions herein set forth, the Company agrees to issue and sell
to each Underwriter, and, upon the basis of the representations,
warranties and agreements of the Company herein contained and
subject to all the terms and conditions set forth herein, each
Underwriter agrees, severally and not jointly, to purchase from the
Company the number of Firm Shares set forth opposite the name of
such Underwriter in Schedule A attached hereto (subject to
adjustment in accordance with Section 9 hereof) at a purchase price
of $25.30 per share (the “Purchase Price Per
Share”).
The Company is advised by you that
the Underwriters intend (i) to make a public offering of their
respective portions of the Firm Shares as soon after the date
hereof as in your judgment is advisable and (ii) initially to offer
the Firm Shares upon the terms set forth in the Prospectus.
You may from time to time increase or decrease the public offering
price after the initial public offering to such extent as you may
determine.
In addition, the Company hereby
grants to the several Underwriters the option to purchase, and upon
the basis of the representations, warranties and agreements of the
Company and subject to all the terms and conditions herein set
forth, the Underwriters shall have the right to purchase, severally
and not jointly, from the Company, ratably in accordance with the
number of Firm Shares to be purchased by each of them (subject to
such adjustment as you shall determine to avoid fractional shares),
all or a portion of the Additional Shares as may be necessary to
cover over-allotments made in connection with the offering of the
Firm Shares, at the Purchase Price Per Share. This
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option may be exercised by you on
behalf of the several Underwriters at any time on or before the
thirtieth day following the date hereof, by written notice to the
Company. Such notice shall set forth the aggregate number of
Additional Shares as to which the option is being exercised, and
the date and time when the Additional Shares are to be delivered
(such date and time being herein referred to as the
“additional time of purchase”); provided ,
however , that the additional time of purchase shall not be
earlier than the time of purchase (as defined below) nor earlier
than the second business day after the date on which the option
shall have been exercised nor later than the tenth business day
after the date on which the option shall have been exercised.
The number of Additional Shares to be sold to each Underwriter
shall be the number which bears the same proportion to the
aggregate number of Additional Shares being purchased as the number
of Firm Shares set forth opposite the name of such Underwriter on
Schedule A hereto bears to the total number of Firm Shares
(subject, in each case, to such adjustment as you may determine to
eliminate fractional shares).
As used herein, “business
day” shall mean a day on which the New York Stock Exchange
(the “NYSE”) is open for trading.
2.
Payment and Delivery . Payment of the purchase price
for the Firm Shares shall be made to the Company by Federal Funds
wire transfer, against delivery of the Firm Shares to you through
the facilities of the Depository Trust Company (“DTC”)
for the respective accounts of the Underwriters. Such payment
and delivery shall be made at 10:00 A.M., New York City time, on
February 12, 2007 (unless another time shall be agreed to by you or
unless postponed in accordance with the provisions of Section 9
hereof). The time at which such payment and delivery are
actually made is hereinafter sometimes called the “time of
purchase.” Certificates, if any, for the Firm Shares
shall be delivered to you in definitive form in such names and in
such denominations as you shall specify no later than the second
business day preceding the time of purchase. For the purpose
of expediting the checking of the certificates for the Firm Shares
by you, the Company agrees to make such certificates available to
you for such purpose at least one full business day preceding the
time of purchase.
Payment of the purchase price for
the Additional Shares shall be made at the additional time of
purchase in the same manner and at the same office as the payment
for the Firm Shares. Certificates, if any, for the Additional
Shares shall be delivered to you in definitive form in such names
and in such denominations as you shall specify no later than the
second business day preceding the additional time of
purchase. For the purpose of expediting the checking of the
certificates for the Additional Shares by you, the Company agrees
to make such certificates available to you for such purpose at
least one full business day preceding the additional time of
purchase.
Deliveries of the documents
described in Section 7 hereof with respect to the purchase of the
Shares shall be made at 9:00 A.M. at such location(s) as shall be
agreed upon by you and the Company on the date of the closing of
the purchase of the Firm Shares or the Additional Shares, as the
case may be.
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3.
Representations and Warranties of the Company . The
Company represents and warrants to and agrees with each of the
Underwriters that:
(a)
no order preventing or suspending the use of the Basic Prospectus,
any Prepricing Prospectus, the Prospectus Supplement, the
Prospectus or any Permitted Free Writing Prospectus is in effect
and no proceedings for such purpose are pending or, to the
knowledge of the Company, threatened by the Commission or the
securities authority of any state or other jurisdiction. The
Registration Statement has become effective under the Act; no stop
order suspending the effectiveness of the Registration Statement is
in effect, and no proceedings for such purpose are pending before
or, to the knowledge of the Company, threatened by the Commission
or the securities authority of any state or other
jurisdiction;
(b)
(i) the Company is eligible to use Form S-3 and the offering of the
Shares complies and will comply with the requirements of Rule 415
under the Act including, without limitation, Rule 415(a)(5); (ii)
each part of the Registration Statement, and also any Abbreviated
Registration Statement, when it became effective, complied, or with
respect to any part of the Registration Statement or any
Abbreviated Registration Statement that has not yet become
effective, will comply at the time of effectiveness, and as of the
date hereof and, as amended or supplemented, at the time of
purchase and at all times during which a prospectus is required by
the Act to be delivered (whether physically or through compliance
with Rule 172 under the Act or any similar rule) in connection with
any sale of Shares, will comply, in all material respects, with
applicable requirements of the Act and the Exchange Act; (iii) each
part of the Registration Statement did not, as of the Effective
Time, contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading; (iv) each Prepricing
Prospectus, if any, complied, at the time it was filed with the
Commission, and complies as of the date hereof, in all material
respects with the requirements of the Act; (v) the Disclosure
Package, as of the time of execution of this Agreement, did not
include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; (vi) the Basic Prospectus complied or will comply, at
the time it was or will be filed with the Commission, in all
material respects with the requirements of the Act; (vii) each of
the Prospectus Supplement and the Prospectus will comply, as of the
date that it is filed with the Commission, the date of the
Prospectus Supplement, the time of purchase and at all times during
which a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any
similar rule) in connection with any sale of Shares, in all
material respects, with the requirements of the Act (in the case of
the Prospectus, including, without limitation, Section 10(a) of the
Act); (viii) at no time during the period that begins on the
earlier of the date of the Prospectus Supplement and the date the
Prospectus Supplement is filed with the Commission and ends at the
later of the time of purchase and the end of the period during
which a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any
similar rule) in connection with any sale of Shares did or will any
Prospectus Supplement or the Prospectus, as then amended or
supplemented, include an untrue statement of a material fact or
omit to state a material
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fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; (ix) at
no time during the period that begins on the date of such Permitted
Free Writing Prospectus and continues through the time of the
filing of the Prospectus with the Commission did or will any
Permitted Free Writing Prospectus include an untrue statement of a
material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that the
representations and warranties set forth in this paragraph (b) do
not apply to statements or omissions in the Registration Statement,
the Basic Prospectus, any Prepricing Prospectus, the Prospectus
Supplement, the Prospectus or any Permitted Free Writing Prospectus
based upon information relating to any Underwriter furnished to the
Company by such Underwriter through you expressly for use
therein;
(c)
(i) the Company has not, directly or indirectly, distributed and
will not distribute any offering material in connection with the
offering or sale of the Shares other than the Basic Prospectus, any
Prepricing Prospectus, the Permitted Free Writing Prospectuses, if
any, and the Prospectus; (ii) the Company has not, directly or
indirectly, prepared, used or referred to any Permitted Free
Writing Prospectus except in compliance with Rule 163 or with Rules
164 and 433 under the Act; (iii) assuming that such Permitted Free
Writing Prospectus is so sent or given after the Registration
Statement was filed with the Commission (and after such Permitted
Free Writing Prospectus was, if required pursuant to Rule 433(d)
under the Act, filed with the Commission), the sending or giving,
by any Underwriter, of any Permitted Free Writing Prospectus will
satisfy the provisions of Rule 164 or Rule 433 (without reliance on
subsections (b), (c) and (d) of Rule 164), (iv) the conditions set
forth in one or more of subclauses (i) through (iv), inclusive, of
Rule 433(b)(1) under the Act are satisfied, (v) the Prepricing
Prospectus is a prospectus that, other than by reason of Rule 433
or Rule 431 under the Act, satisfies the requirements of Section 10
of the Act, (vi) neither the Company nor the Underwriters are
disqualified, by reason of subsection (f) or (g) of Rule 164 under
the Act, from using, in connection with the offer and sale of the
Shares, “free writing prospectuses” (as defined in Rule
405 under the Act) pursuant to Rules 164 and 433 under the Act,
(vii) the Company is not an “ineligible issuer” (as
defined in Rule 405 under the Act) as of the eligibility
determination date for purposes of Rules 164 and 433 under the Act
with respect to the offering of the Shares contemplated by the
Registration Statement, (viii) the parties hereto agree and
understand that the content of any and all “road shows”
(as defined in Rule 433 under the Act) related to the offering of
the Shares contemplated hereby is solely the property of the
Company;
(d)
the Incorporated Documents, when they were filed with the
Commission, complied in all material respects with the requirements
of the Exchange Act, and none of such documents, when they were
filed with the Commission, contained an untrue statement of a
material fact or omitted to state a material fact necessary to make
the statements therein not misleading; and any further documents so
filed and incorporated by reference in (i) the Registration
Statement, when such documents are filed with the Commission, will
conform in all material respects to the requirements of the
Exchange Act, as applicable, and will not contain an untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein not
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misleading, and
(ii) any Prepricing Prospectus, the Prospectus or any Permitted
Free Writing Prospectus, when such documents are filed with the
Commission, will conform in all material respects to the
requirements of the Exchange Act, as applicable, and will not
contain an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the
light of the circumstances in which they were made, not
misleading;
(e)
except for a contemplated increase of 7,000,000 authorized Common
Shares, as of the date of this Agreement, the Company has, and as
of the time of purchase the Company will have, an authorized
capitalization as set forth in the Registration Statement, any
Prepricing Prospectus and the Prospectus (and any similar
information, if any, contained in any Permitted Free Writing
Prospectus); as of the date of this Agreement the Company has an
outstanding capitalization as set forth in the Registration
Statement, any Prepricing Prospectus and the Prospectus and as of
the time of purchase there shall not have been any changes since
the date of this Agreement in the Company’s outstanding
capitalization, except for differences which are not material; all
of the issued and outstanding Common Shares of the Company have
been duly and validly authorized and issued and are fully paid and
non-assessable, have been issued in compliance with all federal and
state securities laws and were not issued in violation of any
preemptive or similar right;
(f)
the Company has been duly formed and is validly existing as a real
estate investment trust in good standing under the laws of the
State of Maryland, with trust power to own, lease and operate its
properties and conduct its business as described in the
Registration Statement, the Prepricing Prospectus, the Prospectus
and the Permitted Free Writing Prospectuses, if any, and to execute
and deliver this Agreement and to issue, sell and deliver the
Shares as contemplated herein;
(g)
the Company is duly qualified and is in good standing in each
jurisdiction in which the ownership or leasing of its properties or
the conduct of its business requires such qualification, except
where the failure to so qualify in any such jurisdiction would not
individually or in the aggregate have a material adverse effect on
the business, prospects, properties, condition (financial or
otherwise) or results of operations of the Company and the
Subsidiaries (as defined herein), taken as a whole (a
“Material Adverse Effect”);
(h)
The Company does not own, directly or indirectly, any shares of
stock or any other equity or long-term debt of any other
corporation or have any direct or indirect equity interest or
ownership of long-term debt in any firm, partnership, joint
venture, limited liability company, association or other entity
except for (i) the Company’s subsidiaries (as defined in the
Act) (the “Subsidiaries”) and (ii) the Company’s
ownership of 1,000,000 common shares of HRPT Properties Trust,
35,000 common shares of Five Star Quality Care, Inc. and 100 common
shares of Marriott International, Inc. The Subsidiaries
identified in Schedule C attached hereto (each, a
“Significant Subsidiary”) are the only Subsidiaries of
the Company that are significant subsidiaries (as such term is
defined by Rule 1-02(w) of Regulation S-X) of the Company.
Each Significant Subsidiary has been duly incorporated or formed
and is
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validly existing
as a corporation or other entity, as the case may be, in good
standing under the laws of the jurisdiction of its incorporation or
organization, with the requisite corporate, trust, partnership or
other power to acquire and own, lease and operate its properties
and to conduct its business, as described in the Registration
Statement, the Prepricing Prospectus, the Prospectus and the
Permitted Free Writing Prospectuses, if any; and each Significant
Subsidiary is duly qualified and in good standing to do business in
each jurisdiction in which the nature of its business or the
ownership or leasing of the property requires such qualification,
except where the failure to be so qualified would not individually
or in the aggregate have a Material Adverse Effect. Each of
the Significant Subsidiaries is duly qualified and in good standing
to do business in the jurisdictions set forth below the name of
such Significant Subsidiary on Schedule D hereto, such
jurisdictions being the only jurisdictions in which the nature of
its business or the ownership or leasing of the property requires
such qualification, except where the failure to be so qualified
would not individually or in the aggregate have a Material Adverse
Effect. Each Subsidiary that is not a Significant Subsidiary
has been duly incorporated or formed and is validly existing as a
corporation or other entity, as the case may be, in good standing
under the laws of the jurisdiction of its incorporation or
organization, with the requisite corporate, trust, partnership or
other power to acquire and own, lease and operate its properties
and to conduct its business, as described in the Registration
Statement, the Prepricing Prospectus, the Prospectus and the
Permitted Free Writing Prospectuses, if any; and each Subsidiary
that is not a Significant Subsidiary is duly qualified and in good
standing to do business in each jurisdiction in which the nature of
its business or the ownership or leasing of the property requires
such qualification, except where the failure to be so qualified
would not individually or in the aggregate have a Material Adverse
Effect;
(i)
this Agreement has been duly authorized, executed and delivered by
the Company;
(j)
the shares of beneficial interest of the Company, including the
Shares, conform in all material respects to each description
thereof, if any, included or incorporated by reference in the
Registration Statement, any Prepricing Prospectus, the Prospectus
or any Permitted Free Writing Prospectus. The certificates,
if any, evidencing the Shares are in due and proper form and
conform in all material respects to the requirements of the
Maryland REIT Law;
(k)
the Shares have been duly and validly authorized and, when issued
and delivered against payment therefore as provided herein, will be
duly and validly issued, fully paid and non-assessable and free of
any preemptive or similar rights;
(l)
neither the Company nor any of the Subsidiaries is in breach or
violation of, or in default under (and no event has occurred which
with notice, lapse of time, or both would result in any breach or
violation of, or constitute a default under), (i) its Declaration
of Trust, charter or by-laws or other organizational documents,
(ii) any obligation, agreement, covenant or condition contained in
any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any Subsidiary is
subject or by which any of them or any of their properties is bound
or
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affected or (iii)
any order, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company or any of its or its
Subsidiaries’ properties, except, in the case of clauses (ii)
and (iii), for those breaches, violations or defaults which,
individually or in the aggregate, would not have a Material Adverse
Effect;
(m)
the issuance by the Company of the Shares, the compliance by the
Company with all of the provisions of this Agreement, the
execution, delivery and performance by the Company of this
Agreement, and the consummation of the transactions contemplated
herein (including, without limitation, the application of the net
proceeds of the offering by the Company as described in the
Prospectus) will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon the Shares or any property or assets of
the Company pursuant to (i) the provisions of the Declaration of
Trust or the bylaws of the Company or any Subsidiary or any of the
Company’s or any Subsidiary’s other organizational
documents, (ii) any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or
any Subsidiary is a party or by which the Company or any Subsidiary
is bound or to which any of the property or assets of the Company
or any Subsidiary is subject, or (iii) any applicable laws or any
order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company or any of its or its
Subsidiaries’ properties, other than, in the case of clause
(ii), as would not, individually or in the aggregate, have a
Material Adverse Effect or a material adverse effect on the ability
of the Company to consummate the transactions contemplated
hereby;
(n)
no approval, authorization, consent or order of or filing with any
federal, state or local or foreign governmental or regulatory
commission, board, body, authority or agency or with the New York
Stock Exchange (“NYSE”), or approval of the
shareholders of the Company, is required in connection with the
issuance and sale of the Shares or the consummation by the Company
of the transactions as contemplated hereby (including, without
limitation, the application of the net proceeds of the offering by
the Company as described in the Prepricing Prospectus and the
Prospectus), other than registration of the Shares under the Act,
which has been effected (or, with respect to any registration
statement to be filed hereunder pursuant to Rule 462(b) under the
Act, will be effected in accordance herewith), and any necessary
qualification under the securities or blue sky laws of the various
jurisdictions in which the Shares are being offered by the
Underwriters;
(o)
no person has the right, contractual or otherwise, to cause the
Company to issue to it, or register pursuant to the Act, any shares
of beneficial interest or other equity interests. No person
has preemptive rights, co-sale rights, rights of first refusal or
other rights to purchase any Common Shares. No person has the
right, contractual or otherwise, to cause the Company to register
under the Act any shares of beneficial interest or other equity
interests as a result of the filing or effectiveness of the
Registration Statement or the sale of Shares contemplated thereby,
except for such rights as have been complied with or
waived;
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(p)
Ernst & Young LLP, whose report on the consolidated financial
statements of the Company and the Subsidiaries was filed with the
Commission as part of the Company’s Annual Report on Form
10-K/A for the fiscal year ended December 31, 2005 and is
incorporated by reference in the Registration Statement, the
Prepricing Prospectus, the Prospectus and, if applicable, any
Permitted Free Writing Prospectuses, are independent public
accountants as required by the Act and by the rules of the Public
Company Accounting Oversight Board;
(q)
all legal or governmental proceedings, affiliate or other related
party transactions, off-balance sheet transactions (including,
without limitation, transactions related to, and the existence of,
“variable interest entities” within the meaning of
Financial Accounting Standards Board Interpretation No. 46),
contracts, leases or documents of a character required to be
described in the Registration Statement, the Prepricing Prospectus,
the Prospectus or any Incorporated Document, and all documents
required to be filed as an exhibit to the Registration Statement,
any Prepricing Prospectus, the Prospectus or any Incorporated
Document, have been so described or filed or will be filed prior to
the time of purchase as required;
(r)
except as otherwise described in the Registration Statement, each
Disclosure Package and the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of the
Subsidiaries is a party or of which any of the Company’s or
any of the Subsidiaries’ properties or assets is the subject,
the result of which would, individually or in the aggregate, have a
Material Adverse Effect or a material adverse effect on the ability
of the Company to consummate the transactions contemplated hereby,
and, to the Company’s knowledge, no such proceedings are
threatened or contemplated, except as disclosed in the Registration
Statement, each Disclosure Package and the Prospectus, the result
of which would, individually or in the aggregate, have a Material
Adverse Effect or a material adverse effect on the ability of the
Company to consummate the transactions contemplated hereby.
To the Company’s knowledge, there are no legal or
governmental proceedings pending or threatened to which any lessee,
sublessee or operator of any property of the Company or any
Subsidiary or portion thereof is a party, the result of which
would, individually or in the aggregate, have a Material Adverse
Effect, and no such proceedings are being threatened or
contemplated, except as disclosed in the Registration Statement,
each Disclosure Package and the Prospectus and the result of which
would, individually or in the aggregate, have a Material Adverse
Effect. Neither the Company nor any of the Subsidiaries has
received from any governmental authority notice of any violation of
any local, state or federal law, rule or regulation (including
without limitation any such law, rule or regulation applicable to
the health care industry (“Health Care Laws”) or
relating to human health or safety or the environment or any
hazardous or toxic substances or wastes, pollutants or contaminants
(“Environmental Laws”)), except as disclosed in the
Registration Statement, each Disclosure Package and the Prospectus,
the result of which would, individually or in the aggregate, have a
Material Adverse Effect, and to the Company’s knowledge,
there is no such violation, or any occurrence or circumstance that
would give rise to a claim under or pursuant to any local, state or
federal law, rule or regulation (including without limitation any
Health Care Laws or Environmental Laws), which would, individually
or in the aggregate, have a Material Adverse Effect. To
the
11
Company’s
knowledge, there is no violation of any local, state or federal
law, rule or regulation (including without limitation Health Care
Laws and Environmental Laws) by any person from whom the Company or
any of the Subsidiaries acquired any of its properties (a
“seller”), or any lessee, sublessee or operator of any
of their respective properties or any part thereof, the result of
which would, individually or in the aggregate, have a Material
Adverse Effect, and to the Company’s knowledge, there is no
such violation, or any occurrence or circumstance that would give
rise to a claim under or pursuant to any local, state or federal
law, rule or regulation (including without limitation any Health
Care Laws or Environmental Laws), which would, individually or in
the aggregate, have a Material Adverse Effect, except as disclosed
in the Registration Statement, each Disclosure Package and the
Prospectus. Neither the Company nor any of the Subsidiaries
has received from any governmental authority any written notice of
any condemnation of or zoning change affecting the properties or
any part thereof of the Company or any of the Subsidiaries that
individually or in the aggregate would have a Material Adverse
Effect and the Company does not know of any such condemnation or
zoning change which is threatened and which if consummated
individually or in the aggregate would have a Material Adverse
Effect. Nothing has come to the Company’s attention
that any seller, lessee, sublessee or operator of any property of
the Company or any of the Subsidiaries, or portion thereof has,
received from any governmental authority any written notice of any
condemnation of or zoning change affecting the Properties (as
defined in Section 3(s) below) or any part thereof of the Company
or any of the Subsidiaries that individually or in the aggregate
would have a Material Adverse Effect;
(s)
as of the respective dates at which such information is given, each
of the Company and the Subsidiaries has good and marketable title
in fee simple or ground leases to the properties disclosed in the
Registration Statement, each Disclosure Package and the Prospectus
as being owned by them (the “Properties”); and the
Properties are free and clear of all liens, encumbrances, claims,
mortgages, deeds of trust, restrictions, security interests and
defects (“Property Encumbrances”), except for: (i) the
leasehold interests of lessees in the Company’s and the
Subsidiaries’ properties held under lease (the
“Leases”), (ii) any other Property Encumbrances that
would not, individually or in the aggregate, have a Material
Adverse Effect and (iii) those Property Encumbrances set forth in
the Registration Statement, each Disclosure Package and the
Prospectus. All Property Encumbrances on or affecting the
properties of the Company or any of the Subsidiaries which are
required to be disclosed in the Registration Statement, each
Disclosure Package and the Prospectus are disclosed therein.
Except where it would not individually or in the aggregate have a
Material Adverse Effect, each of the Leases pertaining to the
properties of the Company or any of the Subsidiaries has been duly
authorized by the Company or one of the Subsidiaries, as
applicable, and is a valid and binding agreement of the Company or
one of the Subsidiaries, as applicable, and, to the Company’s
knowledge, each other party thereto, enforceable in accordance with
its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency, moratorium, fraudulent conveyance or other
similar laws affecting the enforcement of creditors’ rights
generally and by general equitable principles. To the
Company’s knowledge, no lessee of any portion of any of the
properties of the Company or any of the Subsidiaries is in default
under its respective lease and there is no event which, but for the
passage of time or the giving of notice or both, would constitute a
default under
12
any such lease,
except as disclosed in the Registration Statement, each Disclosure
Package and the Prospectus and except for such defaults that would
not, individually or in the aggregate, have a Material Adverse
Effect;
(t)
the Company and each of the Subsidiaries and, to the
Company’s knowledge, each of the operators, lessees or
sublessees of any property or portion thereof of the Company or any
of the Subsidiaries have such permits, licenses, approvals,
certificates, franchises and authorizations of governmental or
regulatory authorities (“permits”), including, without
limitation, under any Health Care Laws or Environmental Laws, as
are necessary in the case of each such party to acquire and own,
lease or operate its properties and to conduct its business, except
where the failure to obtain such permits would not individually or
in the aggregate have a Material Adverse Effect; except as
described in the Registration Statement, each Disclosure Package
and the Prospectus, the Company and each of the Subsidiaries and,
to the Company’s knowledge, each of the lessees, sublessees
or operators of any property or portion thereof of the Company or
any of the Subsidiaries have fulfilled and performed all of their
obligations with respect to such permits and, except as disclosed
in the Registration Statement, each Disclosure Package and the
Prospectus, no event has occurred which allows, or after notice or
lapse of time would allow, revocation or termination thereof or
result in any other impairment of the rights of the holder of any
such permit, except where the failure to fulfill or perform, or the
resulting termination or impairment, would not, individually or in
the aggregate, have a Material Adverse Effect; and, except as
described in the Registration Statement, each Disclosure Package
and the Prospectus, such permits contain no restrictions that are
burdensome to the Company and the Subsidiaries, taken as a whole
and that would, individually or in the aggregate, have a Material
Adverse Effect;
(u)
the financial statements, as restated, together with the related
schedules and notes, forming a part of the Registration Statement,
any Prepricing Prospectus, the Prospectus or any Permitted Free
Writing Prospectus, present fairly the consolidated financial
position of the Company and the Subsidiaries as of the dates
indicated and the consolidated results of operations and cash flows
of the Company and the Subsidiaries for the periods
specified. Such financial statements have been prepared in
conformity with generally accepted accounting principles applied on
a consistent basis during the periods involved. Any pro forma
financial statements and other pro forma financial data included or
incorporated by reference in the Registration Statement, any
Prepricing Prospectus, the Prospectus or any Permitted Free Writing
Prospectus comply as to form in all material respects with the
applicable accounting requirements of Regulation S-X of the Act,
and the pro forma adjustments have been properly applied to the
historical amounts in the compilation of those statements. To
the extent applicable, all disclosures contained in the
Registration Statement, any Prepricing Prospectus, the Prospectus,
any Permitted Free Writing Prospectus or any Incorporated Document
regarding Non-GAAP Financial Measures (as such term is defined by
the rules and regulations of the Commission) comply, in all
material respects, with Regulation G of the Exchange Act and, if
applicable, Item 10 of Regulation S-K. The Company and the
Subsidiaries do not have any material liabilities or obligations,
direct or contingent (including any off-balance sheet obligations
or any “variable interest entities” within the meaning
of Financial Accounting Standards Board Interpretation No. 46), not
disclosed
13
in the
Registration Statement, each Prepricing Prospectus and the
Prospectus. The other financial and statistical data set
forth in the Registration Statement, any Prepricing Prospectus, the
Prospectus and any Permitted Free Writing Prospectus are accurately
presented and prepared on a basis consistent with the financial
statements and books and records of the Company. There are no
financial statements (historical or pro forma) that are required to
be included in the Registration Statement, any Prepricing
Prospectus or the Prospectus that are not included as
required;
(v)
subsequent to the respective dates as of which information is given
in the Registration Statement, any Prepricing Prospectus, the
Prospectus and any Permitted Free Writing Prospectus, in each case
excluding any amendments or supplements to the foregoing made after
the execution of this Agreement, there has not been (i) any
material adverse change, or any prospective material adverse
change, in the business, properties, condition (financial or
otherwise) or results of operations of the Company and the
Subsidiaries taken as a whole, (ii) any transaction which is
material to the Company or the Subsidiaries, (iii) any obligation,
direct or contingent, which is material to the Company and the
Subsidiaries taken as a whole, incurred by the Company or the
Subsidiaries, (iv) any material change in the outstanding shares of
beneficial interest or material increase in the outstanding
indebtedness of the Company or the Subsidiaries or (v) any dividend
or distribution of any kind declared, paid or made on the shares of
beneficial interest of the Company or a dividend distribution of
any kind on any class of its shares of beneficial interest (other
than dividends or distributions from wholly-owned subsidiaries of
the Company) other than (A) regular quarterly dividends, declared,
paid or made and (B) the issuance of common shares of beneficial
interest to the trustees and officers of the Company and directors,
officers and employees of Reit Management & Research LLC, the
Company’s investment manager (“RMR”), pursuant to
the Company’s Incentive Share Award Plan and to RMR in
payment of its incentive fee in accordance with the Company’s
advisory agreement with RMR filed as an exhibit to the Registration
Statement. None of the Company nor the Subsidiaries has any
material contingent obligation which is not disclosed in the
Registration Statement;
(w)
each of the Company and the Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks
and in such amount as are customary in the business in which they
are engaged, except as described in the Registration Statement,
each Disclosure Package and the Prospectus. Except as would
not, individually or in the aggregate, have a Material Adverse
Effect, all policies of insurance insuring the Company and the
Subsidiaries or any of their businesses, assets, employees,
officers, directors and trustees are in full force and effect, and
the Company and the Subsidiaries are in compliance with the terms
of such policies in all material respects. Except as would
not, individually or in the aggregate, have a Material Adverse
Effect, there are no claims by the Company or any of the
Subsidiaries under any such policy or instrument as to which any
insurance company is denying liability or defending under a
reservation of rights clause;
(x)
except as disclosed in the Registration Statement, each Disclosure
Package and the Prospectus, neither the Company nor any of the
Subsidiaries has either sent or received any communication
regarding termination of, or intent not to renew, any
14
of the contracts
or agreements referred to or described in, or filed as an exhibit
to, the Registration Statement, any Prepricing Prospectus, the
Prospectus, any Permitted Free Writing Prospectus or any
Incorporated Document, and no such termination or non-renewal has
been threatened by the Company or any of the Subsidiaries or any
other party to any such contract or agreement;
(y)
the Company has obtained for the benefit of the Underwriters the
agreement (a “Lock-Up Agreement”), in the form set
forth as Exhibit A hereto, of its managing trustees (Messrs. Barry
M. Portnoy and Gerard M. Martin) and executive officers (Messrs.
David J. Hegarty and John R. Hoadley);
(z)
neither the Company nor any of the Subsidiaries or any of their
respective affiliates has taken, directly or indirectly, any action
designed to or which has constituted or which might reasonably be
expected to cause or result, under the Exchange Act or otherwise,
in the stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the
Shares;
(aa)
the Company and the Subsidiaries have not sustained since the date
of the latest audited financial statements included in the
Registration Statement, any Prepricing Prospectus and the
Prospectus any loss or interference with their businesses from
fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as disclosed in the
Prospectus or other than any loss or interference, which would not
individually or in the aggregate have a Material Adverse
Effect;
(bb)
the Company and the Subsidiaries maintain a system
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