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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): JUNE 8, 1999
ALEXANDRIA REAL ESTATE EQUITIES, INC.
(Exact Name of Registrant as Specified in Charter)
MARYLAND 1-12993 95-4502084
(State or Other Jurisdiction of (Commission (IRS Employer
Incorporation or Organization) File Number) Identification No.)
135 NORTH LOS ROBLES AVENUE
SUITE 250
PASADENA, CALIFORNIA 91101
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (626) 578-0777
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ITEM 5. OTHER EVENTS.
On June 8, 1999, Alexandria Real Estate Equities, Inc. (the "Company")
entered into an Underwriting Agreement with PaineWebber Incorporated, Banc of
America Securities LLC and EVEREN Securities, Inc. (the "Underwriters"), in
connection with an underwritten public offering by the Company of up to
1,610,000 shares (the "Shares") of its 9.50% Series A Cumulative Redeemable
Preferred Stock, par value $0.01 per share, at a price of $24.2125 per share,
resulting in aggregate proceeds to the Company of approximately $33.9 million.
The Shares that are being offered and sold have been registered on Form S-3
(Registration No. 333-56451) relating to the registration of the Shares and
certain other securities of the Company, filed by the Company with the
Securities and Exchange Commission (the "Commission") pursuant to Rule 415 of
the Securities Act of 1933, as amended (the "Securities Act"), on June 9, 1998,
and Amendment No. 1 thereto, as filed by the Company with the Commission under
the Securities Act on June 26, 1998, including information deemed to be part of
the registration statement at the time of effectiveness pursuant to Rule 430A of
the General Rules and Regulations under the Securities Act.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) EXHIBITS.
1.1 Underwriting Agreement, dated as of June 8, 1999, by and between
the Company and the Underwriters.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ALEXANDRIA REAL ESTATE
EQUITIES, INC.
Date: June 11, 1999 By: /s/ Peter J. Nelson
------------------------------------
Peter J. Nelson
Chief Financial Officer, Senior Vice
President, Treasurer and Secretary
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EXHIBIT INDEX
EXHIBIT SEQUENTIALLY
NUMBER EXHIBIT NUMBERED PAGE
------- ------- -------------
1.1 Underwriting Agreement, dated as of June 8, 1999,
by and between the Company and the Underwriters
Ex-1
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1,400,000 SHARES
ALEXANDRIA REAL ESTATE EQUITIES, INC.
9.50% SERIES A CUMULATIVE REDEEMABLE PREFERRED STOCK
(PAR VALUE $0.01 PER SHARE)
UNDERWRITING AGREEMENT
----------------------
June 8, 1999
PAINEWEBBER INCORPORATED
BANC OF AMERICA SECURITIES LLC
EVEREN SECURITIES, INC.
c/o PaineWebber Incorporated
1285 Avenue of Americas
New York, New York 10019
Ladies and Gentlemen:
Alexandria Real Estate Equities, Inc., a Maryland corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the Underwriters named in SCHEDULE A hereto (the
"Underwriters") an aggregate of 1,400,000 shares (the "Firm Shares") and, at
the election of the Underwriters, up to 210,000 additional shares (the "Optional
Shares") of 9.50% Series A Cumulative Redeemable Preferred Stock, par value $.01
per share (the "Preferred Stock"), of the Company (the Firm Shares and the
Optional Shares that the Underwriters elect to purchase pursuant to Section 2
hereof being collectively called the "Shares").
The title, specific number of shares, rank, stated value, liquidation
preference, dividend rate, divided payments dates, redemption provisions,
sinking fund requirements, conversion provisions and other terms of the
Preferred Stock are set forth in Articles Supplementary relating to the
Preferred Stock filed with the State Department of Assessments and Taxation of
Maryland (the "Articles Supplementary").
1. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-56451) (the
"Initial Registration Statement") in respect of the Shares has been filed with
the Securities and Exchange
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Commission (the "Commission"); the Initial Registration Statement and any
post-effective amendment thereto, each in the form heretofore delivered to
you and, excluding exhibits thereto but including all documents incorporated
by reference in the prospectus contained therein, to each of the other
Underwriters, have been declared effective by the Commission in such form;
other than (i) a registration statement, if any, increasing the size of the
offering (a "Rule 462(b) Registration Statement"), filed pursuant to Rule
462(b) under the Securities Act of 1933, as amended (the "Act"), which became
effective upon filing, and (ii) the Company's periodic and current reports,
no other document with respect to the Initial Registration Statement or any
document incorporated by reference therein has heretofore been filed with the
Commission; no stop order suspending the effectiveness of the Initial
Registration Statement or any part thereof, any post-effective amendment
thereto or the Rule 462(b) Registration Statement, if any, has been issued
and no proceeding for that purpose has been initiated or, to the Company's
knowledge, threatened by the Commission; any preliminary prospectus included
in the Initial Registration Statement or filed with the Commission pursuant
to Rule 424(a) of the rules and regulations of the Commission under the Act
is hereinafter called a "Preliminary Prospectus"; the various parts of the
Initial Registration Statement and the Rule 462(b) Registration Statement, if
any, including all exhibits thereto and including (i) the information
contained in the form of final prospectus, which shall be comprised of the
prospectus supplement and initial prospectus, filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof
and deemed by virtue of Rule 430A under the Act to be part of the Initial
Registration Statement at the time it was declared effective and (ii) the
documents incorporated by reference in the prospectus contained in the
Initial Registration Statement at the time such part of the Initial
Registration Statement became effective, each as amended at the time such
part of the Initial Registration Statement became effective or such part of
the Rule 462(b) Registration Statement, if any, became or hereafter becomes
effective, are hereinafter collectively called the "Registration Statement";
such final prospectus, in the form first filed pursuant to Rule 424(b) under
the Act, is hereinafter called the "Prospectus"; any reference herein to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item 12
of Form S-3 under the Act, as of the date of such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment or supplement
to any Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include any documents filed after the date of such Preliminary Prospectus
or Prospectus, as the case may be, under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), and incorporated by reference in such
Preliminary Prospectus or Prospectus, as the case may be; and any reference
to any amendment to the Registration Statement shall be deemed to refer to
and include any annual report of the Company filed pursuant to Section 13(a)
or 15(d) of the Exchange Act after the effective date of the Initial
Registration Statement that is incorporated by reference in the Registration
Statement; for purposes of this Agreement, all references to the Registration
Statement, the Prospectus, any Preliminary Prospectus or to any amendment or
supplement thereto shall be deemed to include any copy filed with the
Commission pursuant to its Electronic Data Gathering Analysis and Retrieval
System (EDGAR), and such copy shall be identical in content to any Prospectus
delivered to the Underwriters for use in connection with the offering of the
Shares.
(b) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; and any further
documents so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto,
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when such documents become effective or are filed with the Commission, as the
case may be, will conform in all material respects to the requirements of the
Act or the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder 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 to make the statements therein not misleading; provided, however,
that this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information concerning
the Underwriters furnished in writing to the Company by an Underwriter
through PaineWebber Incorporated ("PaineWebber") expressly for use therein;
(c) The Registration Statement, at the time it became effective,
conformed, and any further amendments or supplements to the Registration
Statement, when they become effective, will conform, in all material respects to
the requirements of the Act and the rules and regulations of the Commission
thereunder and did not and will not, as of the applicable effective date,
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; provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in conformity
with information concerning the Underwriters furnished in writing to the Company
by an Underwriter through PaineWebber expressly for use therein;
(d) The Prospectus, when filed with the Commission, conformed and any
amendment or supplement thereto, at the respective times of filing with the
Commission, will conform, in all material respects to the requirements of the
Act and the rules and regulations of the Commission thereunder, and will not, as
of such respective filing times, 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, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance upon
and in conformity with information concerning the Underwriters furnished in
writing to the Company by an Underwriter through PaineWebber expressly for use
therein;
(e) Neither the Company nor any of its subsidiaries has sustained since
the date of the latest audited financial statements included or incorporated by
reference in 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,
otherwise than as set forth or contemplated in the Prospectus, that singly or in
the aggregate could be reasonably expected to have a material adverse effect, in
or affecting the general affairs, management, financial position, stockholders'
equity or results of operations of the Company and its subsidiaries, taken as a
whole (a "Material Adverse Effect"); and, since the respective dates as of which
information is given in the Registration Statement and the Prospectus, there has
not been any change in the stock or long-term debt of the Company or any
subsidiary of the Company that constitutes a "significant subsidiary" as defined
in Rule 1-02 of Regulation S-X (each such significant subsidiary, a
"Subsidiary") in any such case, otherwise than as set forth or contemplated in
the Prospectus;
(f) The Company and its subsidiaries have good and marketable title in
fee simple to all real property (other than (i) the Company's ground leasehold
interest in the Buildings 79 and 96 Charlestown Navy Yard, 8000, 9000 and 10,000
Virginia Manor Road and 2625, 2627 and 2631 Hanover Street properties and (ii)
the Company's interest in the 1311, 1401 and 1431 Harbor Bay Parkway property,
in which the Company owns a commercial condominium interest together with an
undivided interest in the common areas of the project in which the property is a
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part) and good and marketable title to all personal property owned by them,
in each case free and clear of all liens, encumbrances and defects, except
for the related mortgage indebtedness described in the Prospectus and such
other liens, encumbrances and defects as are described in the Prospectus or
such as could not reasonably be expected to have a Material Adverse Effect
and do not materially interfere with the use made and proposed to be made of
such property by the Company and its subsidiaries; and any real property and
buildings held under lease (other than ground leases referred to above) by
the Company and its subsidiaries that are described in the Prospectus are
held by them under valid, subsisting and enforceable leases with such
exceptions as are not material and do not materially interfere with the use
made and proposed to be made of such property and buildings by the Company
and its subsidiaries;
(g) 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 power
and authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases properties
or conducts any business so as to require such qualification, or is subject to
no material liability or disability by reason of the failure to be so qualified
in any such jurisdiction; each subsidiary of the Company has been duly organized
and is validly existing and in good standing under the laws of its jurisdiction
of organization; each Subsidiary and its jurisdiction of organization is set
forth on SCHEDULE 1(g) hereto; each of the Company's subsidiaries has power and
authority (corporate and other) to own its properties and conduct its business
as described in the Prospectus, and has been duly qualified as a foreign
corporation, partnership, limited liability company or other entity, as the case
may be, for the transaction of business and is in good standing under the laws
of each other jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, or is subject to no material
liability or disability by reason of the failure to be so qualified in any such
jurisdiction;
(h) The Company has an authorized, issued and outstanding
capitalization as set forth in the Prospectus, and all of the issued and
outstanding shares of stock of the Company have been duly and validly authorized
and issued, are fully paid and non-assessable and conform to the description of
the stock contained in the Prospectus under the heading "Description of Capital
Stock"; and all of the issued shares of stock, partnership interests or
membership interests of each subsidiary of the Company have been duly and
validly authorized and issued, are fully paid and non-assessable and (except for
directors' qualifying shares) are owned directly or indirectly by the Company,
free and clear of all liens, encumbrances, equities or claims, except such as
are described in the Prospectus or such as do not materially interfere with the
ownership thereof by the Company and its subsidiaries in each case, except as
would not have a Material Adverse Effect;
(i) The Shares to be issued and sold by the Company to the Underwriters
hereunder have been duly and validly authorized and, when issued and delivered
against payment therefor as provided herein, will be duly and validly issued and
fully paid and non-assessable, will conform to the description of the Preferred
Stock contained in the Prospectus and will not be subject to any preemptive
rights of any security holder of the Company; no holder of Shares will be
subject to personal liability by reason of being such a holder; the Articles
Supplementary will be in full force and effect prior to each applicable Time of
Delivery and will comply with all applicable legal requirements; except as set
forth in the Prospectus and except pursuant to the Company's 1997 Amended and
Restated Stock Award and Incentive Plan, the issuance, sale or offering of the
Shares by the Company will not give rise to any options to purchase, or any
preemptive or other rights or warrants to subscribe for, or any obligations or
commitments of the
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Company to issue, sell, convert, exchange or register with the Commission any
shares of stock, warrants, convertible securities or obligations of the
Company or any shares of stock of or membership interests or partnership
interests in any subsidiary or any such warrants, convertible securities or
obligations;
(j) The issue and sale of the Shares by the Company and the compliance
by the Company with all of the provisions of this Agreement and the consummation
of the transactions herein contemplated will not (i) conflict with or result in
a breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries is
subject, except for such conflicts, breaches, violations or defaults that could
not be reasonably expected to result in a Material Adverse Effect, (ii) result
in any violation of the provisions of the charter or bylaws of the Company or
(iii) result in any violation of any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the Company or
any of its subsidiaries or any of their properties, except for such violations
that could not be reasonably expected to result in a Material Adverse Effect;
and no consent, approval, authorization, order, registration or qualification of
or with any such court or governmental agency or body is required for the issue
and sale of the Shares or the consummation by the Company of the transactions
contemplated by this Agreement, except the registration under the Act of the
Shares and such consents, approvals, authorizations, registrations or
qualifications (i) as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the Underwriters,
(ii) as may be required pursuant to the listing requirements of the New York
Stock Exchange ("NYSE"), (iii) as may be required by the National Association of
Securities Dealers, Inc. ("NASD") or (iv) as have already been obtained;
(k) Neither the Company nor any of its subsidiaries is (i) in violation
of its charter, bylaws or similar organizational document or (ii) in default in
the performance or observance of any obligation, agreement, covenant or
condition contained in any indenture, mortgage, deed of trust, loan agreement,
lease or other agreement or instrument to which it is a party or by which it or
any of its properties may be bound, except, in the case of this clause (ii), for
such defaults that could not be reasonably expected to result in a Material
Adverse Effect;
(l) The statements set forth in the Prospectus under the caption
"Description of Capital Stock", insofar as they purport to constitute a summary
of the terms of the Shares and under the captions "Federal Income Tax
Considerations" and "Certain Federal Income Tax Considerations", insofar as they
purport to describe the provisions of the laws and documents referred to
therein, are accurate, complete and fair in all material respects;
(m) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries
is a party or of which any property of the Company or any of its subsidiaries is
the subject which, could reasonably be expected to have a Material Adverse
Effect; and, to the best of the Company's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by others;
(n) The Company is not and, after giving effect to the offering and
sale of the Shares, will be, an "investment company", as such term is defined in
the Investment Company Act of 1940, as amended (the "Investment Company Act");
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(o) Ernst & Young LLP, who have certified certain financial statements
of the Company and its subsidiaries and certain properties acquired by the
Company and its subsidiaries, are independent public accountants as required by
the Act and the rules and regulations of the Commission thereunder;
(p) Commencing with the Company's taxable year ended December 31, 1996,
the Company has been organized and operated in conformity with the requirements
for qualification and taxation as a real estate investment trust ("REIT") under
Sections 856 through 860 the Internal Revenue Code of 1986, as amended (the
"Code"), and its actual method of operation through the date of this Agreement
and its planned method of operation will continue to enable it to meet the
requirements for qualification and taxation as a REIT for the taxable years
ending December 31, 1999 and thereafter;
(q) Except as set forth in the Prospectus, the Company has no knowledge
of (i) the presence of any hazardous substances, hazardous materials, toxic
substances or hazardous or toxic wastes (collectively, "Hazardous Materials") on
any of the properties owned by it in violation of law or in excess of regulatory
action levels that could reasonably be expected to have a Material Adverse
Effect or (ii) any unlawful spills, releases, discharges or disposal of
Hazardous Materials that have occurred or are presently occurring on or from
such properties as a result of any construction on or operation and use of such
properties, which presence or occurrence could reasonably be expected to have a
Material Adverse Effect; and in connection with the construction on or operation
and use of the properties owned by the Company, it has no knowledge of any
failure to comply with all applicable local, state and federal environmental
laws, regulations, agency requirements, ordinances and administrative and
judicial orders that could reasonably be expected to have a Material Adverse
Effect;
(r) The Company has reviewed its operations and that of its
subsidiaries and is reviewing that of any third parties with which the Company
or any of its subsidiaries has a material relationship to evaluate the extent to
which the business or operations of the Company or any of its subsidiaries will
be affected by the Year 2000 Problem. As a result of such review, the Company
has no reason to believe, and does not believe, that the Year 2000 Problem will
have a Material Adverse Effect. The "Year 2000 Problem" as used herein means
any significant risk that computer hardware or software used in the receipt,
transmission, processing, manipulation, storage, retrieval, retransmission or
other utilization of data or in the operation of mechanical or electrical
systems of any kind will not, in the case of dates or time periods occurring
after December 31, 1999, function at least as effectively as in the case of
dates or time periods occurring prior to January 1, 2000;
(s) The consolidated financial statements of the Company, together
with the related schedules and notes thereto, set forth or included or
incorporated by reference in the Registration Statement and Prospectus fairly
present in all material respects the financial condition of the Company and
its consolidated subsidiaries as of the dates indicated and the results of
operations, changes in financial position, stockholders' equity and cash
flows for the periods therein specified, in conformity with generally
accepted accounting principles consistently applied throughout the periods
involved (except as otherwise stated therein); the summary and selected
financial and statistical data included or incorporated by reference in the
Registration Statement and the Prospectus present fairly in all material
respects the information shown therein and, to the extent based upon or
derived from the financial statements, have been compiled on a basis
consistent with the financial statements presented therein; in addition, the
pro forma financial statements of the Company, and the related notes thereto,
included or incorporated by reference in the Registration Statement and the
Prospectus present fairly in all material respects the
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information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements and have been properly compiled on the basis described therein,
and the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the transactions
and circumstances referred to therein; furthermore, all financial statements
required by Rule 3-14 of Regulation S-X ("Rule 3-14") have been included or
incorporated by reference in the Registration Statement and the Prospectus
and any such financial statements are in conformity with the requirements of
Rule 3-14; and no other financial statements are required to be set forth or
to be incorporated by reference in the Registration Statement or the
Prospectus under the Act or the rules and regulations of the Commission
thereunder;
(t) The Company has full corporate power and authority to enter into
this Agreement and to execute, deliver and file the Articles Supplementary; this
Agreement has been duly authorized, executed and delivered by the Company and
constitutes and at each Time of Delivery will constitute a valid and binding
agreement of the Company, enforceable against the Company in accordance with its
terms; and the Articles Supplementary have been duly authorized, executed,
delivered and filed by the Company; and
(u) The Company has not taken, directly or indirectly, any action
designed to or which might reasonably be expected to cause or result in, or
which has constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of any stock of the Company to
facilitate the sale or resale of any of the Shares.
2. Subject to the terms and conditions herein set forth, (i) the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
a purchase price per share of $24.2125 the number of Firm Shares set forth
opposite the name of such Underwriter in SCHEDULE A hereto and (ii) in the event
and to the extent that the Underwriters shall exercise the election to purchase
Optional Shares as provided below, the Company agrees to issue and sell to each
of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at the purchase price per share set forth
in clause (i) of this Section 2, that portion of the number of Optional Shares
as to which such election shall have been exercised (to be adjusted by you so as
to eliminate fractional shares) determined by multiplying such number of
Optional Shares by a fraction, the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in SCHEDULE A hereto and the denominator
of which is the maximum number of Optional Shares that all of the Underwriters
are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to 210,000 Optional Shares, at the purchase price per share
set forth in the paragraph above, for the sole purpose of covering
overallotments in the sale of the Firm Shares. Any such election to purchase
Optional Shares may be exercised only by written notice from PaineWebber to
the Company, given within a period of 30 calendar days after the date of this
Agreement, setting forth the aggregate number of Optional Shares to be
purchased and the date on which such Optional Shares are to be delivered, as
determined by PaineWebber but in no event earlier than the First Time of
Delivery (as defined in Section 4 hereof) or, unless PaineWebber and the
Company otherwise agree in writing, earlier than two or later than ten
business days after the date of such notice.
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3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as PaineWebber may request upon at least forty-eight hours' prior notice
to the Company shall, at the Time of Delivery, be delivered by or on behalf of
the Company to PaineWebber, through the facilities of the Depository Trust
Company ("DTC"), for the account of such Underwriter, against payment by or on
behalf of such Underwriter of the purchase price therefor by wire transfer of
Federal (same-day) funds to the account specified by the Company to PaineWebber
at least forty-eight hours in advance. The Company will cause the certificates
representing the Shares to be made available for checking and packaging at least
twenty-four hours prior to the Time of Delivery (as defined below) with respect
thereto at the office of DTC or its designated custodian (the "Designated
Office"). The time and date of such delivery and payment shall be, with respect
to the Firm Shares, 9:30 a.m., New York City time, on June 11, 1999 or such
other time and date as PaineWebber and the Company may agree upon in writing,
and, with respect to the Optional Shares, 9:30 a.m., New York City time, on the
date specified by PaineWebber in the written notice given by PaineWebber of the
Underwriters' election to purchase such Optional Shares, or such other time and
date as PaineWebber and the Company may agree upon in writing. Such time and
date for delivery of the Firm Shares is herein called the "First Time of
Delivery", such time and date for delivery of the Optional Shares, if not the
First Time of Delivery, is herein called the "Second Time of Delivery", and each
such time and date for delivery is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on
behalf of the parties hereto pursuant to Section 7 hereof, including the cross
receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7(j) hereof, will be delivered at the offices
of Rogers & Wells LLP, 200 Park Avenue, New York, New York 10166 (the "Closing
Location"), and the Shares will be delivered at the Designated Office, all at
such Time of Delivery. For the purposes of this Section 4, "New York Business
Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is
not a day on which banking institutions in New York are generally authorized or
obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file
such Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier time
as may be required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or Prospectus prior to
the last Time of Delivery which shall be reasonably disapproved by you promptly
after reasonable notice thereof; to advise you, promptly after it receives
notice thereof, of the time when any amendment to the Registration Statement has
been filed or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed and to furnish you with copies thereof; to
file promptly all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the
Prospectus and for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Shares; to advise you, promptly
after it receives notice thereof, of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or of any order
preventing or suspending the use of
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any Preliminary Prospectus or Prospectus, of the suspension of the
qualification of the Shares for offering or sale in any jurisdiction, of the
initiation or threatening of any proceeding for any such purpose, or of any
request by the Commission for the amending or supplementing of the
Registration Statement or Prospectus or for additional information; and, in
the event of the issuance of any stop order suspending the effectiveness of
the Registration Statement or of any order preventing or suspending the use
of any Preliminary Prospectus or Prospectus or suspending any such
qualification, promptly to use its best efforts to obtain thewithdrawal of
such order;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as you may request and to comply with
such laws so as to permit the continuance of sales and dealings therein in
such jurisdictions for as long as may be necessary to complete the
distribution of the Shares, provided that in connection therewith the Company
shall not be required to qualify as a foreign corporation or to file a
general consent to service of process in any jurisdiction;
(c) Prior to noon, New York City time, on the New York Business Day
next succeeding the date of this Agreement (or prior to 5:00 P.M., New York
City time, on such next New York Business Day if the First Time of Delivery
is the fourth New York Business Day following the date of this Agreement) and
from time to time thereafter, to furnish the Underwriters with copies of the
Prospectus in New York City in such quantities as you may reasonably request,
and, if the delivery of a prospectus is required at any time prior to the
expiration of nine months after the time of issue of the Prospectus in
connection with the offering or sale of the Shares and if at such time any
event shall have occurred as a result of which the Prospectus as then amended
or supplemented would, in the opinion of Underwriters' counsel, include an
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 when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary during such
period to amend or supplement the Prospectus or to file under the Exchange
Act any document incorporated by reference in the Prospectus in order to
comply with the Act or the Exchange Act, to notify you and upon your request
to file such document and to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as you may from
time to time reasonably request of an amended Prospectus or a supplement to
the Prospectus which will correct such statement or omission or effect such
compliance, and in case any Underwriter is required to deliver a prospectus
in connection with sales of any of the Shares at any time nine months or more
after the time of issue of the Prospectus, upon your request but at the
expense of such Underwriter, to prepare and deliver to such Underwriter as
many copies as you may request of an amended or supplemented Prospectus
complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations
thereunder (including, at the option of the Company, Rule 158);
(e) During the period beginning from the date hereof and continuing to
and including the date 90 days after the date of the Prospectus, not to offer,
sell, contract to sell or otherwise dispose of, except as provided hereunder,
any securities of the Company that are substantially similar to the Shares,
including but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Preferred Stock or any
such substantially
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similar securities (other than pursuant to employee stock option plans
existing on, or upon the conversion or exchange of convertible or
exchangeable securities outstanding as of, the date of this Agreement ),
without your prior written consent;
(f) To furnish to its stockholders as soon as practicable after the end
of each fiscal year an annual report (including a balance sheet and statements
of income, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries certified by independent public accountants) and, as
soon as practicable after the end of each of the first three quarters of each
fiscal year (beginning with the fiscal quarter ending after the effective date
of the Registration Statement), to make available to its stockholders
consolidated summary financial information of the Company and its subsidiaries
for such quarter in reasonable detail;
(g) During a period of five years from the effective date of the
Registration Statement to furnish to you copies of all reports or other
communications (financial or other) furnished to stockholders and not publicly
available on the Commission's EDGAR system, and to deliver to you (i) as soon as
they are available, copies of any reports and financial statements furnished to
or filed with the Commission or any national securities exchange on which any
class of securities of the Company is listed unless such reports or financial
statements are publicly available on the Commission's EDGAR system; and (ii)
such additional information concerning the business and financial condition of
the Company as you may from time to time reasonably request (such financial
statements to be on a consolidated basis to the extent the accounts of the
Company and its subsidiaries are consolidated in reports furnished to its
stockholders generally or to the Commission);
(h) To use the net proceeds received by it from the sale of the Shares
pursuant to this Agreement in the manner specified in the Prospectus under the
caption "Use of Proceeds";
(i) To use its reasonable best efforts list, subject to notice of
issuance, the Shares on the NYSE;
(j) To continue to elect to qualify as a "real estate investment trust"
under the Internal Revenue Code of 1986, as amended, and to use its best efforts
to continue to meet the requirements to qualify as a "real estate investment
trust" unless the Board of Directors of the Company determines (as evidenced by
a Board resolution) in good faith that meeting such requirements is not in the
best interests of the Company;
(k) Not to be or become, at any time prior to the expiration of three
years after the last Time of Delivery, an "investment company," as such term is
defined in the Investment Company Act;
(l) If the Company elects to rely upon Rule 462(b), the Company shall
file a Rule 462(b) Registration Statement with the Commission in compliance
with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this
Agreement, and the Company shall at the time of filing either pay to the
Commission the filing fee for the Rule 462(b) Registration Statement or give
irrevocable instructions for the payment of such fee pursuant to Rule 111(b)
under the Act;
(m) The Company will comply with all requirements imposed upon it by
the Act and the rules and regulations of the Commission thereunder and the
Exchange Act and the rules and regulations of the Commission thereunder as from
time to time in force, so far as necessary to permit the continuance of sales
of, or dealings in, the Shares as contemplated by the provisions hereof and the
Prospectus; and
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(n) The Company will not at any time, directly or indirectly, take any
action designed to, or which might reasonably be expected to, cause or result
in, or which has constituted or which might reasonably be expected to
constitute, the stabilization of the price of its stock to facilitate the sale
or resale of any of the Shares.
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, closing documents (including
any compilations thereof) and any other documents in connection with the
offering, purchase, sale and delivery of the Shares; (iii) all expenses in
connection with the qualification of the Shares for offering and sale under
state securities laws as provided in Section 5(b) hereof, including the fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky survey; (iv) all fees and
expenses in connection with listing the Shares on the NYSE; (v) the filing fees
incident to securing any required review by the NASD of the terms of the sale of
the Shares; (vi) the cost of preparing stock certificates; (vii) the cost and
charges of any transfer agent or registrar; and (viii) all other costs and
expenses incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section. It is understood, however,
that, except as provided in this Section, and Sections 8 and 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, stock transfer taxes on resale of any of the Shares by them, and
any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters hereunder, as to the Shares to be
delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company herein are, at and as of such Time of Delivery, true and correct,
the condition that the Company shall have performed all of its obligations
hereunder theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing by
the rules and regulations under the Act and in accordance with Section 5(a)
hereof; if the Company has elected to rely upon Rule 462(b), the Rule 462(b)
Registration Statement shall have become effective by 10:00 P.M., Washington,
D.C. time, on the date of this Agreement; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; all requests for additional information on the
part of the Commission shall have been complied with to your reasonable
satisfaction and no state securities authority shall have suspended the
qualification or registration of the Shares for offering or sale in any
jurisdiction;
(b) Rogers & Wells LLP, counsel for the Underwriters, shall have
furnished to you such written opinion or opinions, dated such Time of Delivery,
with respect to the validity of the Shares, the Registration Statement, the
Prospectus and other related matters as you reasonably may request, and such
counsel shall have received such papers and information as they request to
enable them to pass upon such matters;
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(c) Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the Company,
shall have furnished to you their written opinion, in the form attached as
SCHEDULE 7(c) hereto, dated such Time of Delivery, in form and substance
satisfactory to you;
(d) Joel Marcus, Chief Executive Officer of the Company, shall have
furnished to you his written opinion, in the form attached as SCHEDULE 7(d)
hereto, dated such Time of Delivery, in form and substance satisfactory to you;
(e) Ballard, Spahr, Andrews & Ingersoll, LLP, special Maryland counsel
for the Company, shall have furnished to you their written opinion, in the form
attached as SCHEDULE 7(e) hereto, dated such Time of Delivery, in form and
substance satisfactory to you;
(f) On the date of the Prospectus at a time prior to the execution of
this Agreement, at 9:30 a.m., New York City time, on the effective date of
any post-effective amendment to the Registration Statement filed subsequent
to the date of this Agreement and also at such Time of Delivery, Ernst &
Young LLP shall have furnished to you a letter or letters, dated the
respective dates of delivery thereof, in form and substance satisfactory to
you, to the effect set forth in SCHEDULE 7(f)-A hereto (the executed copy of
the letter delivered prior to the execution of this Agreement is attached as
SCHEDULE 7(f)-B hereto and a draft of the form of letter to be delivered on
the effective date of any post-effective amendment to the Registration
Statement and as of each Time of Delivery is attached as SCHEDULE 7(f)-C
hereto);
(g) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included
or incorporated by reference in the Prospectus any significant 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, otherwise than as set forth or
contemplated in the Prospectus, and (ii) since the respective dates as of
which information is given in the Prospectus there shall not have been any
change in the stock or long-term debt of the Company or any of its
Subsidiaries or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole, in any such case, otherwise than as set forth
or contemplated in the Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is in the judgment of the Underwriters so
material and adverse as to make it impracticable or inadvisable to proceed
with the public offering or the delivery of the Shares being delivered at
such Time of Delivery on the terms and in the manner contemplated in the
Prospectus;
(h) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in
securities generally on the NYSE or the National Association of Securities
Dealers Automated Quotation National Market System ("Nasdaq NMS") or the
general establishment of minimum or maximum prices on such exchange or over
the counter market, or the imposition of additional material governmental
restrictions, not in force on the date of this Agreement, upon trading in
securities generally by such exchange or over the counter market or by order
of the Commission or any court or other governmental authority, (ii) a
suspension or material limitation in trading in the Company's securities by
the Commission, the NASD, an exchange that lists such securities or the
Nasdaq NMS; (iii) a general moratorium on commercial banking activities
declared by either Federal or New York State authorities; or (iv) any
material adverse change in the financial or securities markets in the United
States or in political, financial or economic conditions in the United
States, the outbreak or escalation of hostilities involving the United States
or the declaration by the United States of a national emergency or war or
other calamity or crisis, if the effect of any such event specified in this
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Clause (iv) in the judgment of the Underwriters makes it impracticable or
inadvisable to proceed with the public offering or the delivery of the Shares
being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(i) The Company shall have complied with the provisions of Section 5(c)
hereof with respect to the furnishing of prospectuses;
(j) The Company shall have furnished or caused to be furnished to you
at such Time of Delivery certificates of officers of the Company reasonably
satisfactory to you as to the accuracy of the representations and warranties of
the Company herein at and as of such Time of Delivery, as to the performance by
the Company of all of its obligations hereunder to be performed at or prior to
such Time of Delivery, as to the matters set forth in subsections (a) and (g) of
this Section and as to such other matters as you may reasonably request; and
(k) The NASD shall have approved the underwriting terms and
arrangements and such approval shall not have been withdrawn or limited.
8. (a) The Company agrees to indemnify and hold harmless the
Underwriters, their directors, officers, employees and agents and each
person, if any, who controls them within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act from and against any and all losses,
claims, liabilities, expenses and damages (including, but not limited to, any
and all investigative, legal and other expenses reasonably incurred in
connection with, and any and all amounts paid in settlement of, any action,
suit or proceeding between any of the indemnified parties and any
indemnifying parties or between any indemnified party and any third party, or
otherwise, or any claim asserted), as and when incurred to which the
Underwriters, or any such person, may become subject under the Act, the
Exchange Act or other federal or state statutory law or regulation, at common
law or otherwise, insofar as such losses, claims, liabilities, expenses or
damages arise out of or are based on (i) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary prospectus,
the Registration Statement or the Prospectus or any amendment or supplement
to the Registration Statement or the Prospectus or in any documents filed
under the Exchange Act and deemed to be incorporated by reference into the
Prospectus, or in any application or other document executed by or on behalf
of the Company or based on written information furnished by or on behalf of
the Company filed in any jurisdiction in order to qualify the Shares under
the securities or blue sky laws thereof or filed with the Commission, (ii)
the omission or alleged omission to state in such document a material fact
required to be stated in it or necessary to make the statements in it, in the
light of the circumstances under which they were made, not misleading or
(iii) any act or failure to act or any alleged act or failure to act by the
Underwriters in connection with, or relating in any manner to, the Shares or
the offering contemplated hereby, and which is include as part of or referred
to in any loss, claim, damage, liability or action arising out of or based
upon matters covered by clause (i) or (ii) above (provided that the Company
shall not be liable under this clause (iii) to the extent it is finally
judicially determined by a court of competent jurisdiction that such loss,
claim, damage, liability or action resulted directly from any such acts or
failures to act undertaken or omitted to be taken by the Underwriters through
their gross negligence or willful misconduct); provided that the Company will
not be liable to the extent that such loss, claim, liability, expense or
damage arises from the sale of the Shares in the public offering to any
person and is based on an untrue statement or omission or alleged untrue
statement or omission made in reliance on and in conformity with information
relating to the Underwriters furnished in writing to the Company by the
Underwriters expressly for inclusion in the Registration Statement or the
Prospectus. This indemnity agreement will be in addition to any liability
that the Company might otherwise have.
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<PAGE>
(b) The Underwriters will indemnify and hold harmless the Company and
each person, if any, who controls the Company within the meaning of Section 15
of the Act or Section 20 of the Exchange Act, each director of the Company and
each officer of the Company who signs the Registration Statement to the same
extent as the foregoing indemnity from the Company to the Underwriters, but only
insofar as losses, claims, liabilities, expenses or damages arise out of or are
based on any untrue statement or omission or alleged untrue statement or
omission made in reliance on and in conformity with information relating to the
Underwriters furnished in writing to the Company by the Underwriters expressly
for use in the Registration Statement or the Prospectus. This indemnity will be
in addition to any liability that the Underwriters might otherwise have;
provided, however, that in no case shall the Underwriters be liable or
responsible for any amount in excess of the underwriting discounts and
commissions received by the Underwriters.
(c) Any party that proposes to assert the right to be indemnified under
this Section 8 will, promptly after receipt of notice of commencement of any
action against such party in respect of which a claim is to be made against an
indemnifying party or parties under this Section 8, notify each such
indemnifying party of the commencement of such action, enclosing a copy of all
papers served, but the omission so to notify such indemnifying party will not
relieve it from any liability that it may have to any indemnified party under
the foregoing provisions of this Section 8 unless, and only to the extent that,
such omission results in the forfeiture of substantive rights or defenses by the
indemnifying party. If any such action is brought against any indemnified party
and it notifies the indemnifying party of its commencement, the indemnifying
party will be entitled to participate in and, to the extent that it elects by
delivering written notice to the indemnified party promptly after receiving
notice of the commencement of the action from the indemnified party, jointly
with any other indemnifying party similarly notified, to assume the defense of
the action, with counsel reasonably satisfactory to the indemnified party, and
after notice from the indemnifying party to the indemnified party of its
election to assume the defense, the indemnifying party will not be liable to the
indemnified party for any legal or other expenses except as provided below and
except for the reasonable costs of investigation subsequently incurred by the
indemnified party in connection with the defense. The indemnified party will
have the right to employ its own counsel in any such action, but the fees,
expenses and other charges of such counsel will be at the expense of such
indemnified party unless (i) the employment of counsel by the indemnified party
has been authorized in writing by the indemnifying party, (ii) the indemnified
party has reasonably concluded (based on advice of counsel) that there may be
legal defenses available to it or othr indemnified parties that are different
from or in addition to those available to the indemnifying party, (iii) a
conflict or potential conflict exists (based on advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (iv) the indemnifying
party has not in fact employed counsel to assume the defense of such action
within a reasonable time after receiving notice of the commencement of the
action, in each of which cases the reasonable fees, disbursements and other
charges of counsel will be at the expense of the indemnifying party or parties.
It is understood that the indemnifying party or parties shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable
for the reasonable fees, disbursements and other charges of more than one
additional firm admitted to practice in such jurisdiction at any one time for
all such indemnified party or parties. All such fees, disbursements and other
charges will be reimbursed by the indemnifying party promptly as they are
incurred. An indemnifying party will not be liable for any settlement of any
action or claim effected without its written consent (which consent will not be
unreasonably withheld); provided, however, no indemnifying party shall, without
the prior written consent of each indemnified party, settle or compromise or
consent to the entry of any judgment in any pending
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<PAGE>
or threatened claim, action or proceeding relating to the matters
contemplated by this Section 8 (whether or not any indemnified party is a
party thereto), unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising or
that may arise out of such claim, action or proceeding.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in the foregoing
paragraphs of this Section 8 is applicable in accordance with its terms but
for any reason is held to be unavailable from the Company or the
Underwriters, the Company and the Underwriters will contribute to the total
losses, claims, liabilities, expenses and damages (including any
investigative, legal and other expenses reasonably incurred in connection
with, and any amount paid in settlement of, any action, suit or proceeding or
any claim asserted, but after deducting any contribution received by the
Company from persons other than the Underwriters, such as persons who control
the Company within the meaning of the Act, officers of the Company who signed
the Registration Statement and directors of the Company, who also may be
liable for contribution) to which the Company and the Underwriters may be
subject in such proportion as shall be appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on the
other. The relative benefits received by the Company on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by
the Company bear to the total underwriting discounts and commissions received
by the Underwriters, in each case as set forth in the table on the cover page
of the Prospectus. If, but only if, the allocation provided by the foregoing
sentence is not permitted by applicable law, the allocation of contribution
shall be made in such proportion as is appropriate to reflect not only the
relative benefits referred to in the foregoing sentence but also the relative
fault of the Company on the one hand, and the Underwriters, on the other,
with respect to the statements or omissions which resulted in such loss,
claim, liability, expense or damage, or action in respect thereof, as well as
any other relevant equitable consderations with respect to such offering.
Such relative fault shall be determined by reference to whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission
to state a material fact relates to information supplied by the Company or
the Underwriters, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this Section 8(d) were to be
determined by pro rata allocation or by any other method of allocation which
does not take into account the equitable considerations referred to herein.
The amount paid or payable by an indemnified party as a result of the loss,
claim, liability, expense or damage, or action in respect thereof, referred
to above in this Section 8(d) shall be deemed to include, for purpose of this
Section 8(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 8(d), the
Underwriters shall not be required to contribute any amount in excess of the
underwriting discounts and commissions received by the Underwriters and no
person found guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) will be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. For purposes of
this Section 8(d), any person who controls a party to this Agreement within
the meaning of the Act will have the same rights to contribution as that
party, and each officer of the Company who signed the Registration Statement
will have the same rights to contribution as the Company and subject in each
case to the provisions hereof. Any party entitled to contribution, promptly
after receipt of notice of commencement of any action against such party in
respect of which a claim for contribution my be made under this Section 8(d),
will notify any such party or parties from whom contribution may be sought,
but the omission so to notify will not relieve the party or parties from whom
contribution may be sought from any other obligation it or they may
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have under this Section 8(d). Except for a settlement entered into pursuant
to the last sentence of Section 8(c) hereof, no party will be liable for
contribution with respect to any action or claim settled without its written
consent (which consent will not be unreasonably withheld).
(e) The indemnity and contribution agreements contained in this Section
8 and the representations and warranties of the Company and contained in this
Agreement shall remain operative and in full force and effect regardless of (i)
any investigation made by or on behalf of the Underwriters, (ii) acceptance of
the Shares and payment therefor or (iii) any termination of this Agreement.
9. (a) If any Underwriter shall default in its obligation to purchase the
Shares which it has agreed to purchase hereunder at a Time of Delivery, you may
in your discretion arrange for you or another party or other parties to purchase
such Shares on the terms contained herein. If within thirty-six hours after
such default by any Underwriter you do not arrange for the purchase of such
Shares, then the Company shall be entitled to a further period of thirty-six
hours within which to procure another party or other parties satisfactory to you
to purchase such Shares on such terms. In the event that, within the respective
prescribed periods, you notify the Company that you have so arranged for the
purchase of such Shares, or the Company notifies you that it has so arranged for
the purchase of such Shares, you or the Company shall have the right to postpone
such Time of Delivery for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus, or in any other documents or arrangements, and the
Company agrees to file promptly any amendments to the Registration Statement or
the Prospectus which in your opinion may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased does not exceed one-eleventh of the aggregate number of all
the Shares to be purchased at such Time of Delivery, then the Company shall have
the right to require each non-defaulting Underwriter to purchase the number of
shares which such Underwriter agreed to purchase hereunder at such Time of
Delivery and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Shares which such
Underwriter agreed to purchase hereunder) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased exceeds one-eleventh of the aggregate number of all the
Shares to be purchased at such Time of Delivery, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Shares of a defaulting Underwriter or Underwriters,
then this Agreement (or, with respect to the Second Time of Delivery, the
obligations of the Underwriters to purchase and of the Company to sell the
Optional Shares) shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company, except for the expenses to be borne
by the Company and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
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10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company shall not then be under any liability to any Underwriter except as
provided in Sections 6 and 8 hereof; but, if for any other reason, any Shares
are not delivered by or on behalf of the Company as provided herein, the Company
will reimburse the Underwriters through you for all reasonable out-of-pocket
expenses approved in writing by you, including reasonable fees and disbursements
of counsel, reasonably incurred by the Underwriters in making preparations for
the purchase, sale and delivery of the Shares not so delivered, but the Company
shall then be under no further liability to any Underwriter except as provided
in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the Underwriters at the offices of PaineWebber
Incorporated, 1285 Avenue of the Americas, New York, New York 10019, Attention:
Corporate Finance Department and if to the Company shall be delivered or sent by
mail to the address of the Company set forth in the Registration Statement,
Attention: Secretary; provided, however, that any notice to an Underwriter
pursuant to Section 8(c) hereof shall be delivered or sent by mail, telex or
facsimile transmission to such Underwriter at its address set forth in its
Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company by you upon request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and, to the extent provided in Sections 8 and
10 hereof, the officers and directors of the Company and each person who
controls the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Shares from any Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
14. As used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
17
<PAGE>
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
17. The parties hereto hereby irrevocably waive any right they may have to
a trial by jury in respect of any claim based upon or arising out of this
Agreement or the transactions contemplated hereby.
If the foregoing is in accordance with your understanding, please sign and
return to us four counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Underwriters and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Underwriters is pursuant to the authority set forth in a form of Agreement among
Underwriters, the form of which shall be submitted to the Company for
examination upon request, but without warranty on your part as to the authority
of the signers thereof.
Very truly yours,
ALEXANDRIA REAL ESTATE EQUITIES, INC.
By:
---------------------------------
Name:
Title:
Accepted as of the date hereof:
PAINEWEBBER INCORPORATED
By:
------------------------------
Name:
Title:
On behalf of each of the Underwriters
18
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
TOTAL NUMBER OF NUMBER OF OPTIONAL SHARES TO BE
FIRM SHARES TO BE PURCHASED IF MAXIMUM OPTION
UNDERWRITER PURCHASED EXERCISED
-------------------------------------- ----------------- -------------------------------
<S> <C> <C>
PaineWebber Incorporated ............. 466,700 70,006
Banc of America Securities LLC........ 466,650 69,997
EVEREN Securities, Inc................ 466,650 69,997
----------------- -------------------------------
TOTAL............................ 1,400,000 210,000
----------------- -------------------------------
----------------- -------------------------------
</TABLE>
<PAGE>
SCHEDULE 1(g)
SUBSIDIARIES OF THE COMPANY
<TABLE>
<CAPTION>
Subsidiary Jurisdiction of Organization
---------- ----------------------------
<S> <C>
ARE-QRS Corp. Maryland
ARE-GP/II Holdings QRS Corp. Delaware
Alexandria Real Estate Equities, L.P. Delaware
AREE-Holdings II, L.P. Delaware
ARE-Western Newbrook, LLC Delaware
</TABLE>
<PAGE>
SCHEDULE 7(f)-A
Pursuant to Section 7(f) of this Agreement, the accountants shall furnish
letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the Act
and the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included or incorporated by reference in the Registration
Statement or the Prospectus comply as to form in all material respects with
the applicable accounting requirements of the Act or the Exchange Act, as
applicable, and the related published rules and regulations thereunder;
and, if applicable, they have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the consolidated interim financial statements, selected financial data, pro
forma financial information, financial forecasts and/or condensed financial
statements derived from audited financial statements of the Company for the
periods specified in such letter, as indicated in their reports thereon,
copies of which have been separately furnished to the Underwriters and are
attached hereto;
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the unaudited condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows included in the
Prospectus and/or included in the Company's quarterly report on Form 10-Q
incorporated by reference into the Prospectus as indicated in their reports
thereon copies of which have been separately furnished to the Underwriters
are attached hereto; and on the basis of specified procedures including
inquiries of officials of the Company who have responsibility for financial
and accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i) below
comply as to form in the related in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and the
related published rules and regulations, nothing came to their attention
that caused them to believe that the unaudited condensed consolidated
financial statements do not comply as to form in all material respects with
the applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations;
(iv) The unaudited selected financial information with respect to
the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the Prospectus
and included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for such five fiscal years which were
included or incorporated by reference in the Company's Annual Reports on
Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and on
the basis of limited procedures specified in such letter nothing came to
their attention as a result of the foregoing procedures that caused them to
believe that this information does not conform
<PAGE>
in all material respects with the disclosure requirements of Items 301,
302, 402 and 503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included or incorporated by reference
in the Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or incorporated
by reference in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements
of the Exchange Act and the related published rules and regulations,
or (ii) any material modifications should be made to the unaudited
condensed consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included in the
Prospectus or included in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus, for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance
sheet items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial statements
from which such data and items were derived, and any such unaudited
data and items were not determined on a basis substantially consistent
with the basis for the corresponding amounts in the audited
consolidated financial statements included or incorporated by
reference in the Company's Annual Report on Form 10-K for the most
recent fiscal year;
(C) the unaudited financial statements which were not
included in the Prospectus but from which were derived the unaudited
condensed financial statements referred to in Clause (A) and any
unaudited income statement data and balance sheet items included in
the Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed
financial statements included or incorporated by reference in the
Prospectus do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the published rules
and regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements;
(E) as of a specified date not more than five days prior to
the date of such letter, there have been any changes in the
consolidated stock (other than issuances of stock upon exercise of
options and stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest balance sheet
<PAGE>
included or incorporated by reference in the Prospectus) or any
increase in the consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current assets or
stockholders' equity or other items specified by the Underwriters, or
any increases in any items specified by the Underwriters, in each case
as compared with amounts shown in the latest balance sheet included or
incorporated by reference in the Prospectus, except in each case for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in consolidated net revenues or operating profit or the total or per
share amounts of consolidated net income or other items specified by
the Underwriters, or any increases in any items specified by the
Underwriters, in each case as compared with the comparable period of
the preceding year and with any other period of corresponding length
specified by the Underwriters, except in each case for increases or
decreases which the Prospectus discloses have occurred or may occur
or which are described in such letter; and
(vii) In addition to the examination referred to in their
report(s) included or incorporated by reference in the Prospectus and the
limited procedures, inspection of minute books, inquiries and other
procedures referred to in paragraphs (iii) and (vi) above, they have
carried out certain specified procedures, not constituting an examination
in accordance with generally accepted auditing standards, with respect to
certain amounts, percentages and financial information specified by the
Underwriters which are derived from the general accounting records of the
Company and its subsidiaries, which appear in the Prospectus (excluding
documents incorporated by reference) or in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Underwriters or
in documents incorporated by reference in the Prospectus specified by the
Underwriters, and have compared certain of such amounts, percentages and
financial information with the accounting records of the Company and its
subsidiaries and have found them to be in agreement.
