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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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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): December 23, 1998
Great Lakes REIT
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(Exact Name of Registrant as Specified in Charter)
Maryland 1-14307 36-4238056
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(State or Other Jurisdiction (Commission) (IRS Employer
of Incorporation) File Number) Identification No.)
823 Commerce Drive, Suite 300, Oak Brook, Illinois 60523
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (630) 368-2929
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N/A
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS.
On December 23, 1998, Great Lakes REIT (the "Company") consummated an
underwritten public offering (the "Offering") of 1,500,000 shares of the
Company's 9-3/4% Series A Cumulative Redeemable Preferred Shares of
Beneficial Interest, par value $.01 per share ("Series A Preferred Shares"),
at a price per share of $25.00. Dividends on the Series A Preferred Shares
are cumulative from the date of original issuance and are payable quarterly,
commencing March 1, 1999, at the rate of 9-3/4% per annum of the liquidation
preference (equivalent to a fixed annual amount of $2.4375 per share). The
Company may redeem the Series A Preferred Shares at any time on or after
December 16, 2003 at a price of $25.00 per share plus all accrued and unpaid
dividends through the date of redemption. The Offering was made pursuant to a
Prospectus Supplement dated December 16, 1998 that supplements the Company's
Prospectus dated December 16, 1998 and that relates to the Company's
Post-Effective Amendment No. 1 to Registration Statement on Form S-3 (SEC File
No. 333-49499). The Underwriting Agreement related to the Offering is being
filed as an exhibit hereto.
Additional information with respect to the transaction described herein is
set forth in the exhibits hereto.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Financial Statements of Business Acquired: None
(b) Pro Forma Financial Information: None
(c) Exhibits:
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Exhibit
Number Exhibit
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1.1 Underwriting Agreement, dated December 16, 1998, among the
Company and A.G. Edwards & Sons, Inc., Wheat First Union, a
division of Wheat First Securities, Inc., and EVEREN
Securities, Inc.
3.1 Articles Supplementary establishing the rights and
preferences of the Company's Series A Preferred Shares
(Incorporated by reference to Exhibit 1 to the Company's
Form 8-A Registration Statement filed on December 16, 1998.)
5.1 Opinion of Ballard Spahr Andrews & Ingersoll, LLP as to the
validity of the Series A Preferred Shares.
10.1 Fourth Amendment to the Amended and Restated Agreement of
Limited Partnership of Great Lakes REIT, L.P.
23.1 Consent of Ballard Spahr Andrews & Ingersoll, LLP (included
in Exhibit 5.1).
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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.
GREAT LAKES REIT
By: /s/ James Hicks
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Name: James Hicks
Title: Senior Vice President, Chief Financial
Officer and Treasurer
Dated: December 23, 1998
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INDEX TO EXHIBITS
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Exhibit
Number Exhibit
<S> <C>
1.1 Underwriting Agreement, dated December 16, 1998, among the
Company and A.G. Edwards & Sons, Inc., Wheat First Union, a
division of Wheat First Securities, Inc. and EVEREN Securities,
Inc.
3.1 Articles Supplementary establishing the rights and preferences of
the Company's Series A Preferred Shares (Incorporated by
reference to Exhibit 1 to the Company's Form 8-A Registration
Statement filed on December 16, 1998.)
5.1 Opinion of Ballard Spahr Andrews & Ingersoll, LLP as to the
validity of the Series A Preferred Shares.
10.1 Fourth Amendment to the Amended and Restated Agreement of Limited
Partnership of Great Lakes REIT, L.P.
23.1 Consent of Ballard Spahr Andrews & Ingersoll, LLP (included in
Exhibit 5.1).
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Exhibit 1.1
1,500,000 Shares
Great Lakes REIT
9 3/4 % Series A Cumulative Redeemable Preferred Shares of Beneficial Interest
(Liquidation Preference $25.00 per Share)
($.01 Par Value Per Share)
Underwriting Agreement
December 16, 1998
A. G. Edwards & Sons, Inc.
Wheat First Union, a division
of Wheat First Securities, Inc.
EVEREN Securities, Inc.
c/o A. G. Edwards & Sons, Inc.
One North Jefferson Avenue
St. Louis, Missouri 63103
Ladies and Gentlemen:
Great Lakes REIT, a Maryland real estate investment trust (the "Company"),
which qualifies for federal income tax purposes as a real estate investment
trust pursuant to Sections 856 through 860 of the Internal Revenue Code of 1986,
as amended (the "Code"), and Great Lakes REIT, L.P., a Delaware limited
partnership (the "Operating Partnership" and, together with the Company, the
"Transaction Entities"), each wish to confirm as follows its agreement with
A. G. Edwards & Sons, Inc., Wheat First Union, a division of Wheat First
Securities, Inc., and EVEREN Securities, Inc. (the "Underwriters") with respect
to the sale by the Company and the purchase by the Underwriters, acting
severally and not jointly, of the respective numbers of 9 3/4 % Series A
Cumulative Redeemable Preferred Shares of Beneficial Interest of the Company,
$.01 par value per share (the "Shares "), set forth in Schedule I hereto.
Capitalized terms used but not otherwise defined herein shall have the
meanings given to those terms in the Prospectus (as herein defined).
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE TRANSACTION
ENTITIES. Each of the Transaction Entities, jointly and severally, represents,
warrants and agrees that, as of the date hereof:
(a) The Company meets the requirements for the use of Form S-3 under
the Securities Act of 1933, as amended (the "Securities Act"); a registration
statement (Registration No. 333-49499) on Form S-3 and Post-Effective Amendment
No. 1 thereto, including a prospectus relating to the registration of the Shares
and such other securities which may be offered from time to time in accordance
with Rule 415 under the Securities Act, and any further such amendments to such
registration statement as may have been required to the date of this Agreement,
have been prepared by the Company pursuant to and in conformity with the
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requirements of the Securities Act, and the Rules and Regulations (the "Rules
and Regulations") of the Securities and Exchange Commission (the "Commission")
thereunder, and have been filed with the Commission under the Securities Act and
the Registration Statement was declared effective. Copies of such registration
statement, including any amendments thereto, each related preliminary prospectus
contained therein and the exhibits have heretofore been delivered by the Company
to the Underwriters. A prospectus supplement (the "Prospectus Supplement")
setting forth the terms of the offering, sale and plan of distribution of the
Shares has been or will be so prepared and will be filed pursuant to Rule 424(b)
of the Rules and Regulations on or before the second business day after the date
hereof (or such earlier time as may be required by the Rules and Regulations).
The term "Registration Statement" as used herein means the registration
statement and the basic prospectus included therein, as amended at the time it
or any amendment thereto became effective under the Securities Act, or at the
time any Annual Report on Form 10-K is filed by the Company with the Commission
(the "Effective Date"), including financial statements and all exhibits and all
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the Securities Act. Any document filed by the Company under the
Securities Exchange Act of 1934, as amended (the "Exchange Act") after the
effective date of the Registration Statement or the date of the Prospectus
Supplement and incorporated by reference in the Prospectus shall be deemed to be
included in the Registration Statement and the Prospectus as of the date of such
filing. The term "Prospectus" as used herein means (i) the basic prospectus
included in the Registration Statement at the Effective Date, as supplemented by
the Prospectus Supplement as first filed with the Commission pursuant to Rule
424(b) of the Rules and Regulations, except that, if such basic prospectus is
amended or supplemented subsequent to the Effective Date, the term "Prospectus"
shall refer to the basic prospectus as so amended or supplemented and as further
supplemented by the Prospectus Supplement, or (ii) if no such filing is
required, the form of final prospectus included in the Registration Statement at
the Effective Date.
(b) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the Commission, as
the case may be, conform in all respects to the requirements of the Securities
Act and the Rules and Regulations and do not and will not, as of the applicable
Effective Date (as to the Registration Statement and any amendment thereto) and
as of the applicable filing date and on the Closing Date (as defined herein) (as
to the Prospectus and any amendment or supplement thereto) 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 that no representation or warranty is made as to information contained
in or omitted from the Registration Statement or the Prospectus in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of the Underwriters specifically for inclusion therein. The Prospectus
delivered to the Underwriters for use in connection with this offering was, or
will be, identical to the electronically transmitted copies thereof filed with
the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
System ("EDGAR"), except to the extent permitted by Regulation S-T.
(c) The documents incorporated by reference in the Prospectus
pursuant to Item 12 of Form S-3 under the Securities Act, when they became
effective or at the time they were filed with the Commission, as the case may
be, complied in all material respects with the
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requirements of the Exchange Act, and the rules and regulations adopted by
the Commission thereunder, and, when filed with the Commission, did not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading.
(d) No stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued and no proceeding for that purpose
has been instituted or, to the knowledge of either of the Transaction Entities,
threatened by the Commission or by the state securities authority of any
jurisdiction. No order preventing or suspending the use of the Prospectus has
been issued and no proceeding for that purpose has been instituted or, to the
knowledge of either of the Transaction Entities, after due inquiry, threatened
by the Commission or by the state securities authority of any jurisdiction.
(e) The Company has been duly formed and is validly existing as a
real estate investment trust under the laws of the State of Maryland and is in
good standing with the State Department of Assessments and Taxation of Maryland
(the "SDAT"), is duly and properly qualified to do business in each jurisdiction
in which its ownership or lease of property or the conduct of its business
requires such qualification, and has all trust power necessary to own or hold
its properties, to conduct the business in which it is engaged and to enter into
and perform its obligations under this Agreement. The Company has no
significant subsidiaries (as such term is defined in Regulation S-X of the Rules
and Regulations) other than the Operating Partnership. The Operating
Partnership has no subsidiaries.
(f) The Company has an authorized capitalization as set forth in
the Prospectus under the caption "Description of Shares of Beneficial
Interest," and all of the issued and outstanding shares of beneficial
interest of the Company have been duly and validly authorized and issued, are
fully paid and non-assessable and conform to the description thereof
contained in the Registration Statement and the Prospectus. Upon the closing
of the Offering, except as disclosed in the Registration Statement and the
Prospectus, and except with respect to share options outstanding on the date
of the Prospectus and units of partnership interest in the Operating
Partnership ("Units"), no shares of beneficial interest of the Company are
reserved for any purpose and, except for the Units and such outstanding share
options, there are no outstanding securities convertible into or exchangeable
for any shares of beneficial interest of the Company, and no outstanding
options or warrants to purchase or subscribe for any shares of beneficial
interest of the Company. Upon the closing of the Offering, there will be no
outstanding rights to purchase or subscribe for any shares of beneficial
interest of the Company other than such outstanding share options and Units.
(g) The Operating Partnership has been duly formed and is validly
existing as a limited partnership in good standing under the laws of the State
of Delaware, is duly qualified to do business and is in good standing as a
foreign limited partnership in each jurisdiction in which its ownership or lease
of property or the conduct of its business requires such qualification, and has
all partnership power necessary to own or hold its properties, to conduct the
business in which it is engaged and to enter into and perform its obligations
under this Agreement and the other Operative Documents to which it is a party.
On the Closing Date, the Company will be the sole general partner of the
Operating Partnership. On the Closing Date, the
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Agreement of Limited Partnership of the Operating Partnership (the "Operating
Partnership Agreement") will be in full force and effect.
(h) The Shares have been duly and validly authorized and, when issued
and delivered against payment therefor as provided herein, will be duly and
validly issued, fully paid and non-assessable. Upon payment of the purchase
price and when the Underwriters take delivery of the certificates evidencing the
Shares to be sold by the Company and assuming the Underwriters are acquiring
such Shares in good faith (as defined in Section 1-201(19) of the New York
Uniform Commercial Code (the "UCC")), without notice of any adverse claim (as
defined in Section 8-302 of the UCC), the Underwriters will acquire such Shares
free and clear of any and all security interests, claims, liens, equities and
other encumbrances, and such Shares will not be subject to any adverse claim.
The terms of the Shares and any other securities described in the Prospectus
conform in substance to all statements and descriptions related thereto
contained in the Prospectus. The form of the certificates to be used to
evidence the Shares will, on the Closing Date, be in due and proper form and
will comply with all applicable legal requirements. The issuance of the Shares
is not subject to any preemptive or other similar rights.
(i) This Agreement has been duly and validly authorized, executed and
delivered by each of the Transaction Entities, and assuming due authorization,
execution and delivery by the Underwriters, is a valid and binding agreement of
each of the Transaction Entities, enforceable against the Transaction Entities
in accordance with its terms.
(j) The execution, delivery and performance of this Agreement by each
of the Transaction Entities and the consummation of the transactions
contemplated hereby will not 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 either of the Transaction Entities is a party or by which either of the
Transaction Entities is bound or to which any of the Properties or other assets
of either of the Transaction Entities is subject, nor will such actions result
in any violation of the provisions of the declaration of trust or bylaws or
certificate of limited partnership or the Operating Partnership Agreement, as
applicable, of the Transaction Entities, or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
either of the Transaction Entities or any of their respective properties or
assets; and except for the registration of the Shares under the Securities Act
and such consents, approvals, authorizations, registrations or qualifications as
may be required under the Exchange Act and applicable state securities laws in
connection with the purchase and distribution of the Shares by the Underwriters,
no consent, approval, authorization or order of, or filing or registrations
with, any such court or governmental agency or body is required for the
execution, delivery and performance of this Agreement by the Transaction
Entities and the consummation of the transactions contemplated hereby.
(k) Except as disclosed in the Registration Statement and as filed as
Exhibit 4.3 thereto, there are no contracts, agreements or understandings
between the Company and any person granting such person the right to require the
Company to file a registration statement under the Securities Act with respect
to any securities of the Company owned or to be owned by such person or to
require the Company to include such securities in the securities registered
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pursuant to the Registration Statement or in any securities being registered
pursuant to any other registration statement filed by the Company under the
Securities Act.
(l) Neither of the Transaction Entities nor any of the Properties has
sustained, since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus, any material loss or interference
with its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental action,
order or decree, other than as set forth or contemplated in the Prospectus; and,
since such date, there has not been any material change in the capital stock or
long-term debt of either of the Transaction Entities or any material adverse
change, or any development involving a prospective material adverse change, in
or affecting any of the Properties or the general affairs, management, financial
position, stockholders' equity or results of operations of either of the
Transaction Entities, other than as set forth or contemplated in the Prospectus.
(m) The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement or included or
incorporated by reference in the Prospectus present fairly the financial
condition and results of operations of the entities purported to be shown
thereby, at the dates and for the periods indicated, and have been prepared in
conformity with generally accepted accounting principles applied on a consistent
basis throughout the periods involved. Pro forma financial information included
in the Prospectus has been prepared in accordance with the applicable
requirements of the Securities Act, the Rules and Regulations and AICPA
guidelines with respect to pro forma financial information and includes all
adjustments necessary to present fairly the pro forma financial position of the
Company at the respective dates indicated and the results of operations for the
respective periods specified.
(n) Ernst & Young LLP, who have certified certain financial
statements of the Company, whose reports have been incorporated by reference in
the Prospectus and who have delivered the Initial Letter referred to in Section
6(h) hereof, are independent public accountants as required by the Securities
Act and the Rules and Regulations.
(o) (i) On the Closing Date, the Company or the Operating
Partnership will have good and marketable title to each of the Properties, free
and clear of all liens, encumbrances, claims, security interests and defects,
other than those referred to in the Prospectus or those which are not material
in amount or those which would not have a material adverse effect on the
business, operations or use of any of the Properties and all material consents
or approvals with respect to the transfers reflected in the Prospectus of any of
the Properties to the Company or the Operating Partnership shall have been
received; (ii) all liens, charges, encumbrances, claims or restrictions on or
affecting any of the Properties and the assets of either of the Transaction
Entities which are required to be disclosed in the Prospectus are disclosed
therein; (iii) except as otherwise described in the Prospectus, there are no
material defaults by either Transaction Entity under (A) any space leases (as
lessor or lessee, as the case may be) relating to the Properties, or (B) any of
the mortgages or other security documents or other agreements encumbering or
otherwise recorded against the Properties, and neither of the Transaction
Entities knows of any event which, but for the passage of time or the giving of
notice, or both, would constitute a default under any of such documents or
agreements;
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(iv) except as disclosed in the Prospectus, no tenant under any of the leases
at the Properties has a right of first refusal to purchase the premises
demised under such lease which has not been waived; (v) each of the
Properties complies with all applicable codes, laws and regulations
(including, without limitation, building and zoning codes, laws and
regulations and laws relating to access to the Properties), except for such
failures to comply that would not have a material adverse effect on the
business operations, use or value of such Property; and (vi) neither of the
Transaction Entities has knowledge of any pending or threatened condemnation
proceedings, zoning change or other proceeding or action that will in any
material manner affect the size of, use of, improvements on, construction on
or access to the Properties.
(p) Immediately following the application of the net proceeds of the
sale of the Shares in the manner set forth in the Prospectus and as required by
the Operating Partnership Agreement, the mortgages and deeds of trust which will
encumber the Properties will not be convertible into equity securities of the
entity owning such Property and said mortgages and deeds of trust will not be
cross-defaulted or cross-collateralized with any property other than other the
Properties.
(q) On the Closing Date, the Company or the Operating Partnership
will have obtained title insurance on the fee interests in each of the
Properties, in an amount at least equal to the greater of (i) the mortgage
indebtedness of each such Property or (ii) the purchase price of each such
Property.
(r) Except as disclosed in the Prospectus: (i) to the knowledge of
the Transaction Entities, after due inquiry, the operations of the Properties
are in material compliance with all Environmental Laws (as defined below) and
all requirements of applicable permits, licenses, approvals and other
authorizations issued pursuant to Environmental Laws; (ii) to the knowledge of
the Transaction Entities, after due inquiry, none of the Transaction Entities or
any Property has caused or suffered to occur any Release (as defined below) of
any Hazardous Substance (as defined below) into the Environment (as defined
below) on, in, under or from any Property that has not been addressed as
required by Environmental Laws, and no condition exists on, in, under or
adjacent to any Property that could result in the incurrence of liabilities
under, or any violations of, any Environmental Law by the Transaction Entities
or give rise to the imposition of any Lien (as defined below), under any
Environmental Law; (iii) none of the Transaction Entities has received any
written notice of a claim under or pursuant to any Environmental Law or under
common law pertaining to Hazardous Substances on, in, under or originating from
any Property that has not been addressed as required by Environmental Laws;
(iv) neither of the Transaction Entities has actual knowledge of, or received
any written notice from any Governmental Authority (as defined below) claiming,
any violation of any Environmental Law or a determination to undertake and/or
request the investigation, remediation, clean-up or removal of any Hazardous
Substance released into the Environment on, in, under or from any Property that
has not been addressed as required by Environmental Laws; and (v) no Property is
included or, to the knowledge of either of the Transaction Entities, after due
inquiry, proposed for inclusion on the National Priorities List issued pursuant
to CERCLA (as defined below) by the United States Environmental Protection
Agency (the "EPA") or on the Comprehensive Environmental Response, Compensation,
and Liability Information System database maintained by the EPA, and neither of
the Transaction Entities has actual knowledge
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that any Property has otherwise been identified in a published writing by the
EPA as a potential CERCLA removal, remedial or response site or, to the
knowledge of either of the Transaction Entities, is included on any similar
list of potentially contaminated sites pursuant to any other Environmental
Law (except for inclusion on a list of leaking underground storage tank
sites, PROVIDED that the leak has been addressed as required by Environmental
Laws).
As used herein, "Hazardous Substance" shall include any hazardous
substance, hazardous waste, toxic substance, pollutant or hazardous material,
including, without limitation, oil, petroleum or any petroleum-derived substance
or waste, asbestos or asbestos-containing materials, PCBs, pesticides,
explosives, radioactive materials, dioxins, urea formaldehyde insulation or any
constituent of any such substance, pollutant or waste which is subject to
regulation under any Environmental Law (including, without limitation, materials
listed in the United States Department of Transportation Optional Hazardous
Material Table, 49 C.F.R. Section 172.101, or in the EPA's List of Hazardous
Substances and Reportable Quantities, 40 C.F.R. Part 302); "Environment" shall
mean any surface water, drinking water, ground water, land surface, subsurface
strata, river sediment, buildings, structures, and ambient, workplace and indoor
and outdoor air; "Environmental Law" shall mean the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. Section
9601, ET SEQ.) ("CERCLA"), the Resource Conservation and Recovery Act of 1976,
as amended (42 U.S.C. Section 6901, ET SEQ.), the Clean Air Act, as amended (42
U.S.C. Section 7401, ET SEQ.), the Clean Water Act, as amended (33 U.S.C.
Section 1251, ET SEQ.), the Toxic Substances Control Act, as amended (15 U.S.C.
Section 2601, ET SEQ.), the Occupational Safety and Health Act of 1970, as
amended (29 U.S.C. Section 651, ET SEQ.), the Hazardous Materials Transportation
Act, as amended (49 U.S.C. Section 1801, ET SEQ.), and all other federal, state
and local laws, ordinances, regulations, rules and orders relating to the
protection of the environments or of human health from environmental effects;
"Governmental Authority" shall mean any federal, state or local governmental
office, agency or authority having jurisdiction over the Properties and having
the duty or authority to promulgate, implement or enforce any Environmental Law;
"Lien" shall mean, with respect to any Property, any mortgage, deed of trust,
pledge, security interest, lien, encumbrance, penalty, fine, charge, assessment,
judgment or other liability in, on or affecting such Property; and "Release"
shall mean any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping, emanating or disposing of
any Hazardous Substance into the Environment in violation of any Environmental
Law, including, without limitation, the abandonment or discard of barrels,
containers, tanks (including, without limitation, underground storage tanks) or
other receptacles containing or previously containing any Hazardous Substance.
(s) Each Transaction Entity and Property carries, or is covered by,
insurance in such amounts and covering such risks as is adequate for the conduct
of its business and as is customary for companies engaged in similar businesses
in similar industries.
(t) Each Transaction Entity owns or possesses adequate rights to use
all material patents, patent applications, trademarks, service marks, trade
names, trademark registrations, service mark registrations, copyrights and
licenses necessary for the conduct of its business and has no reason to believe
that the conduct of its business will conflict with, and has not received any
notice of any claim of conflict with, any such rights of others.
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(u) Except as described in the Prospectus, there are no legal or
governmental proceedings pending to which any Transaction Entity is a party or
of which any property or assets of any Transaction Entity is the subject which,
if determined adversely to such Transaction Entity, might have a material
adverse effect on the consolidated financial position, stockholders' equity,
results of operations, or business of the Company; and to the best knowledge of
the Transaction Entities, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(v) There are no contracts or other documents which are required to
be described in the Prospectus or filed as exhibits to, or incorporated by
reference into, the Registration Statement by the Securities Act or by the Rules
and Regulations which have not been described in the Prospectus or filed as
exhibits to the Registration Statement.
(w) No relationship, direct or indirect, exists between or among
either of the Transaction Entities on the one hand, and the directors, officers
or stockholders of either of the Transaction Entities on the other hand, which
is required to be described in the Registration Statement which is not so
described.
(x) No labor disturbance by the employees of either Transaction
Entity exists or, to the knowledge of the Transaction Entities, is imminent
which might be expected to have a material adverse effect on the consolidated
financial position, stockholders' equity, results of operations, business or
prospects of such Transaction Entity.
(y) Each Transaction Entity is in compliance in all material respects
with all presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and published
interpretations thereunder ("ERISA"); no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in ERISA) for
which either Transaction Entity would have any liability; neither Transaction
Entity has incurred or expects to incur liability (i) under Title IV of ERISA
with respect to termination of, or withdrawal from, any "pension plan" or
(ii) for violation of Section 412 or for any tax under 4971 of the Code,
including the regulations and published interpretations thereunder; and each
"pension plan" for which either Transaction Entity would have any liability that
is intended to be qualified under Section 401(a) of the Code is so qualified in
all material respects and nothing has occurred, whether by action or by failure
to act, which would cause the loss of such qualification.
(z) Each Transaction Entity has filed all federal, state and local
income and franchise tax returns required to be filed through the date hereof
and has paid all taxes due thereon, and no tax deficiency has been determined
adversely to any Transaction Entity which has had (nor does either Transaction
Entity have any knowledge of any tax deficiency which, if determined adversely
to it might have) a material adverse effect on the financial position,
stockholders' equity, results of operations, business or prospects of such
Transaction Entity.
(aa) Upon completion of the transactions described in the Prospectus
and the sale of the Shares hereunder, the Company and the Operating Partnership
will continue to be organized and operated in conformity with the requirements
for qualification of the Company as
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a real estate investment trust under the Code, and the proposed method of
operation of the Company and the Operating Partnership will enable the
Company to continue to meet the requirements for qualification and taxation
as a real estate investment trust under the Code.
(bb) Since the date as of which information is given in the Prospectus
through the date hereof, and except as may otherwise be disclosed in the
Prospectus, neither Transaction Entity has (i) issued or granted any securities
(other than securities issued pursuant to the exercise of options to purchase
beneficial interests outstanding as of the date information is given in the
Prospectus), (ii) incurred any material liability or obligation, direct or
contingent, other than liabilities and obligations which were incurred in the
ordinary course of business, (iii) entered into any transaction not in the
ordinary course of business or (iv) declared or paid any dividend on its shares
of beneficial interest.
(cc) Each Transaction Entity (i) makes and keeps accurate books and
records and (ii) maintains internal accounting controls which provide reasonable
assurance that (A) transactions are executed in accordance with management's
authorization, (B) transactions are recorded as necessary to permit preparation
of its financial statements and to maintain accountability for its assets,
(C) access to its assets is permitted only in accordance with management's
authorization and (D) the reported accountability for its assets is compared
with existing assets at reasonable intervals.
(dd) No Transaction Entity (i) is in violation of its declaration of
trust, bylaws, certificate of limited partnership, agreement of limited
partnership, trust instrument or other similar organizational document, (ii) is
in default in any material respect, and no event has occurred which, with notice
or lapse of time or both, would constitute such a default, in the due
performance or observance of any term, covenant or condition contained in any
material indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which it is a party or by which it is bound or to which any of
the Properties or any of its other properties or assets is subject or (iii) is
in violation in any material respect of any law, ordinance, governmental rule,
regulation or court decree to which it or the Properties or any of its other
properties or assets may be subject or has failed to obtain any material
license, permit, certificate, franchise or other governmental authorization or
permit necessary to the ownership of the Properties or any of its other
properties or assets or to the conduct of its business.
(ee) Neither Transaction Entity, nor any director, officer, agent,
employee or other person associated with or acting on behalf of either
Transaction Entity, has used any corporate funds for any unlawful contribution,
gift, entertainment or other unlawful expense relating to political activity;
made any direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds; violated or is in
violation of any provision of the Foreign Corrupt Practices Act of 1977; or made
any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment.
(ff) Neither Transaction Entity is an "investment company" or, to the
knowledge of each of the Transaction Entities, an entity "controlled" by an
"investment company," within the meaning of such terms under the Investment
Company Act of 1940 and the rules and regulations of the Commission thereunder.
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(gg) Other than this Agreement and as set forth in the Prospectus
Supplement under the heading "Underwriting," there are no contracts, agreements
or understandings between either Transaction Entity and any person that would
give rise to a valid claim against either Transaction Entity or any Underwriter
for a brokerage commission, finder's fee or other like payment with respect to
the consummation of the transactions contemplated by this Agreement.
(hh) Articles Supplementary setting forth the terms of the Shares (the
"Articles Supplementary") have been duly and validly authorized by all necessary
trust action on behalf of the Company.
(ii) All of the issued Units have been duly and validly authorized and
issued and are fully paid. The issuance of the Preferred Units to the Company
has been approved by all necessary action on behalf of the Partnership and its
partners. As of the date hereof, 16,826,303 Units and 0 Preferred Units are
issued and outstanding and all of such Units and Preferred Units are validly
issued, fully paid and nonassessable. None of the issued Units or Preferred
Units has been issued, or is owned or held, in violation of any preemptive
right. The Units have been offered, sold and issued by the Partnership in
compliance with all applicable laws (including, without limitation, federal and
state securities laws).
2. PURCHASE, SALE AND DELIVERY OF THE SHARES.
(a) On the basis of the representations, warranties and agreements herein
contained, but subject to the terms and conditions herein set forth, the Company
agrees to sell to the Underwriters, and each such Underwriter agrees, severally
and not jointly, to purchase from the Company at a purchase price of $24.2125
per share, the number of Shares set forth opposite the name of such Underwriter
in Schedule I hereto.
(b) Delivery of and payment for the Shares shall be made through the
facilities of the Depository Trust Company, at 10:00 A.M., New York City time,
on December 23, 1998 (unless postponed in accordance with the provisions of
Section 9 hereof), or at such other date or place as shall be determined by
agreement between the Underwriters and the Company. This date and time are
sometimes referred to as the "Closing Date." On the Closing Date, the Company
shall deliver or cause to be delivered certificates representing the Shares to
the Underwriters against payment to or upon the order of the Company of the
purchase price by wire transfer in same day funds. Time shall be of the
essence, and delivery at the time and place specified pursuant to this Agreement
is a further condition of the obligation of the Underwriters hereunder. Upon
delivery, the Shares shall be registered in such names and in such denominations
as the Underwriters shall request in writing not less than two full business
days prior to the Closing Date. For the purpose of expediting the checking and
packaging of the certificates for the Shares, the Company shall make the
certificates representing the Shares available for inspection by the
Underwriters in New York, New York, not later than 2:00 P.M., New York City
time, on the business day prior to the Closing Date.
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3. OFFERING OF SHARES BY THE UNDERWRITERS. It is understood that the
Underwriters propose to offer the Shares to the public upon the terms and
conditions set forth in the Registration Statement and the Prospectus.
4. FURTHER AGREEMENTS OF THE TRANSACTION ENTITIES. Each of the
Transaction Entities jointly and severally agrees:
(a) The Company will (i) prepare a Prospectus Supplement setting
forth the number of Shares covered thereby and their terms not otherwise
specified in the Prospectus pursuant to which the Shares are being issued, the
name of the Underwriters and the number of Shares which the Underwriters have
agreed to purchase, the price at which the Shares are to be purchased by the
Underwriters from the Company and such other information as the Underwriters and
the Company deem appropriate in connection with the offering of the Shares, and
file the Prospectus in a form approved by the Underwriters pursuant to Rule
424(b) under the Act no later than the Commission's close of business on the
second business day following the date of the determination of the offering
price of the Shares; (ii) prior to the termination of the offering of the
Shares, not file any amendment to the Registration Statement or supplement to
the Prospectus, or any document under the Exchange Act if the document would be
deemed to be incorporated by reference into the Registration Statement or the
Prospectus, of which the Underwriters shall not previously have been advised and
furnished with a copy or to which the Underwriters shall have reasonably
objected in writing or which is not in compliance with the Rules and
Regulations; and (iii) prior to the Closing Date, promptly notify the
Underwriters after it shall have received notice thereof of the time when any
amendment to the Registration Statement becomes effective or when any supplement
to the Prospectus has been filed;
(b) To furnish promptly to the Underwriters and to counsel for the
Underwriters five copies of the Registration Statement as originally filed with
the Commission, and each amendment thereto filed with the Commission, including
all consents and exhibits filed therewith, and will also furnish to the
Underwriters and their counsel such number of conformed copies of the
Registration Statement as originally filed and of each amendment thereto, as the
Underwriters may reasonably request;
(c) To deliver promptly to the Underwriters such number of the
following documents as the Underwriters shall reasonably request: (i) conformed
copies of the Registration Statement as originally filed with the Commission and
each amendment thereto (in each case excluding exhibits other than this
Agreement and the computation of per share earnings) and (ii) the Prospectus and
any amended or supplemented Prospectus; and, if the delivery of a prospectus is
required by applicable laws or regulations of any governmental authority at any
time after the Effective Time and prior to the 270th day after the Effective
Date in connection with the offering or sale of the Shares or any other
securities relating thereto and if at such time any events shall have occurred
as a result of which the Prospectus as then amended or supplemented would
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 to amend or
supplement the Prospectus in order to comply with the Securities Act or the
Exchange Act, to notify the Underwriters and, upon their request, to file
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such document and to prepare and furnish without charge to the Underwriters and
to any dealer in securities as many copies as the Underwriters may from time to
time reasonably request of an amended or supplemented Prospectus which will
correct such statement or omission or effect such compliance;
(d) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that may, in the judgment of the Company or the Underwriters, be required by the
Securities Act or requested by the Commission;
(e) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus or any Prospectus
pursuant to Rule 424 of the Rules and Regulations, to furnish a copy thereof to
the Underwriters and counsel for the Underwriters and obtain the consent of the
Underwriters, to the filing, except where obtaining such consent is
impracticable after using reasonable efforts to obtain the consent;
(f) The Company will make generally available to its security holders
as soon as practicable but no later than 60 days after the close of the period
covered thereby an earnings statement (in form complying with the provisions of
Section 11(a) of the Securities Act and Rule 158 of the Rules and Regulations),
which need not be certified by independent certified public accountants, unless
required by the Securities Act or the Rules and Regulations, covering a
twelve-month period commencing after the "effective date" (as defined in said
Rule 158) of the Registration Statement;
(g) During the period when a prospectus relating to any of the Shares
is required to be delivered under the Securities Act by any Underwriter or
dealer, the Company will file promptly all documents required to be filed with
the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act. The Company will furnish to the Underwriters, from time to time during the
period when the Prospectus is required to be delivered under the Securities Act
or the Exchange Act such number of copies of the Prospectus (as amended or
supplemented) as the Underwriters may reasonably request for the purposes
contemplated by the Securities Act or the Exchange Act or the respective
applicable rules and regulations of the Commission thereunder;
(h) For a period of three years following the Closing Date, to
furnish to the Underwriters copies of all materials furnished by the Company to
its shareholders and all public reports and all reports and financial statements
furnished by the Company to the principal national securities exchange upon
which the Shares may be listed pursuant to requirements of or agreements with
such exchange or to the Commission pursuant to the Exchange Act or any rule or
regulation of the Commission thereunder;
(i) Prior to the Closing Date, to apply for the listing of the Shares
on the New York Stock Exchange (the "NYSE") and to use its best efforts to
complete that listing within thirty (30) days following the Closing Date;
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(j) None of the Preferred Units will be issued in violation of any
preemptive right. The Preferred Units will be offered, sold and issued by the
Partnership in compliance with all applicable laws (including, without
limitation, federal and state securities laws).
(k) To take such reasonable steps to ensure that the net proceeds
from the sale of the Shares are applied in a manner that is consistent in all
material respects with the description set forth in the Prospectus under the
caption "Use of Proceeds" and as required pursuant to the Operating Partnership
Agreement;
(l) To take such steps as shall be necessary to ensure that neither
of the Transaction Entities shall become an "investment company", or an entity
"controlled" by an "investment company," within the meaning of such terms under
the Investment Company Act of 1940 and the rules and regulations of the
Commission thereunder;
(m) Except as stated in this Agreement and in the Prospectus, neither
Transaction Entity has taken, nor will take, directly or indirectly, any action
designed to or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of the Shares to facilitate the sale
or resale of the Shares;
(n) To amend the Operating Partnership Agreement to create the
Preferred Units prior to the Closing Date;
(o) To file with the SDAT and cause to become effective, prior to the
Closing Date, the Articles Supplementary in the form last delivered to the
Underwriters prior to the execution of this Agreement, with such changes therein
as the Underwriters approve, such approval not to be unreasonably withheld;
(p) The Company will take such steps as shall be necessary, in its
reasonable business judgment, to maintain the listing of the Shares on the NYSE
for at least 3 years following the Closing Date;
(q) The Company will use its best efforts to continue to meet the
requirements to qualify as a "real estate investment trust" under Sections
856-860 of the Code; and
(r) If this Agreement shall be terminated by the Underwriters because
of any failure or refusal on the part of the Transaction Entities to comply with
the terms or fulfill any of the conditions of this Agreement, the Transaction
Entities jointly and severally agree to reimburse the Underwriters for all
reasonable out-of-pocket expenses (including fees and expenses of counsel for
the Underwriters) incurred by the Underwriters in connection herewith.
5. EXPENSES. The Transaction Entities jointly and severally agree to pay
(a) the costs incident to the authorization, issuance, sale and delivery of the
Shares and any taxes payable in that connection; (b) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration
Statement and any amendments and exhibits thereto; (c) the costs of distributing
the Registration Statement as originally filed and each amendment thereto and
any post-effective amendments thereof (including, in each case, exhibits), the
Prospectus and any amendment or supplement to the Prospectus, all as provided in
this Agreement; (d) the costs
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of producing and distributing this Agreement and any other related documents in
connection with the offering, purchase, sale and delivery of the Shares; (e)
the filing fees incident to securing any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of the Shares;
(f) any applicable listing or other fees; (g) the fees and expenses of
qualifying the Shares under the securities laws of the several jurisdictions as
provided in Section 4(j) hereof and of preparing, printing and distributing a
Blue Sky Memorandum (including related fees and expenses of counsel to the
Underwriters); and (h) all other costs and expenses incident to the performance
of the obligations of the Transaction Entities under this Agreement; PROVIDED
that, except as provided in this Section 5 and in Section 11 hereof, the
Underwriters shall pay their own costs and expenses, including the costs and
expenses of their counsel, any transfer taxes on the Shares which they may sell
and the expenses of advertising any offering of the Shares made by the
Underwriters.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the
Underwriters hereunder are subject to the accuracy, when made and at the Closing
Date, of the representations and warranties of the Transaction Entities
contained herein, to the performance by each Transaction Entity of its
obligations hereunder, and to each of the following additional terms and
conditions:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment to be
declared effective before the offering of the Shares may commence, the
Registration Statement or such post-effective amendment shall become effective
not later than 5:30 P.M., New York City time, on the date hereof, or at such
later date and time as shall be consented to in writing by the Underwriters, and
all filings, if any, required by Rules 424 and 430A under the Rules and
Regulations shall have been timely made; no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceeding for that purpose shall have been instituted or, to the knowledge of
the Transaction Entities or the Underwriters, threatened by the Commission, and
any request of the Commission for additional information (to be included in the
Registration Statement or the Prospectus or otherwise) shall have been complied
with to the satisfaction of the Underwriters.
(b) Subsequent to the effective date of this Agreement, there shall
not have occurred (i) any change, or any development involving a prospective
change, in or affecting the financial condition, business, properties, net
worth, or results of operations of either Transaction Entity, not contemplated
by the Prospectus, which in the opinion of the Underwriters, would materially
adversely affect the market for the Shares, or (ii) any event or development
relating to or involving either Transaction Entity, or any partner, officer,
director or trustee of either Transaction Entity or any Property, which makes
any statement of a material fact made in the Prospectus untrue or which, in the
opinion of the Company and its counsel or the Underwriters and their counsel,
requires the making of any addition to or change in the Prospectus in order to
state a material fact required by the Securities Act or any other law to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, if
amending or supplementing the Prospectus to reflect such event or development
would, in the Underwriters' opinion, adversely affect the market for the Shares.
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<PAGE>
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Shares, the Registration
Statement and the Prospectus, and all other legal matters relating to this
Agreement and the transactions contemplated hereby shall be reasonably
satisfactory in all material respects to counsel for the Underwriters, and the
Company shall have furnished to such counsel all documents and information that
they may reasonably request to enable them to pass upon such matters.
(d) Jones, Day, Reavis & Pogue shall have furnished to the
Underwriters its written opinion, as counsel to the Company, addressed to the
Underwriters and dated the Closing Date, in form and substance reasonably
satisfactory to the Underwriters, to the effect that:
(i) The Operating Partnership has been duly formed and is
validly existing as a limited partnership in good standing under the
laws of the State of Delaware, with partnership power and authority to
own or hold its property and to conduct the business in which it is
engaged substantially as described in the Registration Statement and
the Prospectus, and to enter into and perform its obligations under
this Agreement. The Operating Partnership is qualified or registered
to do business as a foreign partnership and is in good standing in the
States of Colorado, Illinois, Michigan, Minnesota, Ohio and Wisconsin.
The Company is the sole general partner of the Operating Partnership.
The Operating Partnership Agreement is in full force and effect.
(ii) The Units issued, including, without limitation, the Units
issued to the Company, have been duly authorized, legally issued and
fully paid, except that no opinion is given with respect to compliance
with Federal or state securities laws.
(iii) This Agreement has been duly authorized, executed and
delivered by the Operating Partnership.
(iv) The execution, delivery and performance of this Agreement
by each of the Transaction Entities and the consummation of the
transactions contemplated hereby will not (A) result in the violation
by either Transaction Entity of any statute, rule, order or regulation
of any court or governmental agency or body having jurisdiction over
either of the Transaction Entities or any of their properties or
assets, in each case known to such counsel, (B) result in a default
under or breach by either Transaction Entity of any contract
identified as a material contract in a certificate of the Chief
Executive Officer and Secretary of the Company and to which either of
the Transaction Entities is bound or to which any of the Properties or
other assets of either of the Transaction Entities is subject, or
require the consent or waiver of any party to any such contract other
than consents and waivers that have been obtained, (C) conflict with
or result in a default by the Company under its Charter or Bylaws or
(D) conflict with or result in a default by the Operating Partnership
under its certificate of limited partnership or the Operating
Partnership Agreement; and except for the registration of the Shares
under the Securities Act and such consents, approvals,
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authorizations, registrations or qualifications as may be required
under the Exchange Act and applicable state securities, real estate
syndication or Blue Sky laws governing the purchase and sale of the
Shares by the Underwriters, no consent, approval, authorization or
order of, or filing or registration with, any court or governmental
agency or body is required for the execution, delivery and performance
of this Agreement by the Transaction Entities and the consummation of
the transactions contemplated hereby.
(v) Neither Transaction Entity is an "investment company"
within the meaning of such term under the Investment Company Act of
1940 and the rules and regulations of the Commission thereunder.
(vi) Such counsel has been advised that the Registration
Statement has become effective under the Securities Act and, to such
counsel's knowledge, no stop order suspending the effectiveness of the
Registration Statement under the Securities Act has been issued and no
proceedings for that purpose have been instituted or are pending or
threatened by the Commission. Such counsel has been advised by the
staff of the NYSE that the Shares are approved for listing on the
NYSE, subject to official notice of issuance.
(vii) Such counsel has participated in the preparation of the
Registration Statement and the Prospectus (the documents incorporated
into the Prospectus by reference having previously been prepared and
filed by the Company without such counsel's participation). From time
to time, in connection therewith, such counsel has had discussions
with certain officers, directors and employees of the Company,
representatives of Ernst & Young LLP, the independent accounts who
examined certain of the financial statements of the Company and its
consolidated entities incorporated by reference in the Registration
Statement and the Prospectus, and the Underwriters concerning the
Registration Statement and the Prospectus and the proposed responses
to various items in Form S-3. Based thereupon, such counsel is of the
view that the Registration Statement (other than the financial
statements, financial schedules and other financial and statistical
data included or incorporated by reference therein, and except for the
information referred to under the caption "Experts" as having been
incorporated by reference in the Registration Statement on the
authority of Ernst & Young LLP as experts, as to which such counsel is
not called upon to express a view), at the time the Registration
Statement became effective under the Securities Act complied, and the
Prospectus (with the foregoing exceptions), as of its date complied
and as of the Closing Date complies, as to form in all material
respects with the requirements of the Securities Act and the Rules and
Regulations, and that the documents incorporated by reference into the
Prospectus that were filed prior to the date of this letter (other
than the financial statements, financial schedules and other financial
and statistical data included therein, as to which such counsel is not
called upon to express a view) at the time they were filed complied as
to form in all material respects with the requirements of the Exchange
Act and the rules and regulations thereunder.
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(viii) The statements contained in the Prospectus under the
caption "Federal Income Tax Considerations" and in the Prospectus
Supplement under the caption "Certain Federal Income Tax
Considerations," to the extent they constitute matters of law or
constitute legal conclusions, are correct in all material respects and
fairly summarize the federal income tax considerations that are likely
to be material to a holder of the Shares.
(ix) Commencing with the Company's taxable year ended December
31, 1993, and for all taxable periods thereafter, the Company (as the
successor in interest to Great Lakes REIT, Inc., a Maryland
corporation, pursuant to the merger of Great Lakes REIT, Inc. with and
into the Company) has been organized and has operated in conformity
with the requirements for qualification and taxation as a real estate
investment trust under the Code and the Treasury Regulations
promulgated thereunder, and the current and proposed organization and
method of operation of the Company and the Operating Partnership, as
described in the Prospectus and the documents incorporated therein by
reference and as represented in the Company's officers' certificate
delivered in connection with this opinion, will enable the Company to
continue to meet the requirements for qualification and taxation as a
real estate investment trust for its current and subsequent taxable
years.
(x) The Operating Partnership is properly classified as a
partnership for federal income tax purposes and not as an association
taxable as a corporation or as a "publicly traded partnership" within
the meaning of Section 7704 of the Code.
In rendering such opinion, such counsel may (i) state that its opinion is
limited to matters governed by the Federal laws of the United States of America;
and (ii) rely (to the extent such counsel deems proper and specifies in their
opinion), as to matters involving the application of the laws of the States of
Maryland and Delaware upon the opinion of other counsel of good standing,
PROVIDED that such other counsel is satisfactory to counsel for the Underwriters
and furnishes a copy of its opinion to the Underwriters. Such counsel shall
also have furnished to the Underwriters the following written statement,
addressed to the Underwriters and dated the Closing Date, in form and substance
satisfactory to the Underwriters. Such counsel has not independently verified
and is not passing upon, and does not assume any responsibility for, the
accuracy, completeness or fairness of the information contained in the
Registration Statement or the Prospectus, including any document incorporated or
deemed to be incorporated therein by reference, except to the extent of the
opinion called for by Section 6(d)(x). Based solely on the participation and
discussions described above in Section 6(d)(ix), however, no facts have come to
such counsel's attention that cause such counsel to believe that the
Registration Statement (except for the financial statements, financial schedules
and other financial and statistical data included or incorporated by reference
therein, and except for the information referred to under the caption "Experts"
as having been incorporated by reference in the Registration Statement on the
authority of Ernst & Young LLP as experts, as to which such counsel has not been
called upon to express a view), at the time it became effective contained an
untrue statement of material fact or omitted to state a material fact required
to be stated therein or necessary in order to make
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the statements therein not misleading, or that the Prospectus, including the
documents filed by the Company with the Commission prior to the date of such
opinion that are incorporated or deemed to be incorporated by reference into
the Prospectus (with the foregoing exceptions) as of its date contained, or on
the Closing Date contains, any untrue statement of a material fact or as of its
date, or on the Closing Date omits, to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(e) Ballard Spahr Andrews & Ingersoll, LLP shall have furnished to
the Underwriters its written opinion, as Maryland counsel to the Company,
addressed to the Underwriters and dated the Closing Date, in form and substance
reasonably satisfactory to the Underwriters, to the effect that:
(i) The Company is a real estate investment trust duly formed
and validly existing under and by virtue of the laws of the State of
Maryland and is in good standing with the SDAT. The Company has full
trust power (A) to own or hold its properties and to conduct the
business in which it is engaged as described in the Registration
Statement and the Prospectus and (B) to enter into and perform its
obligations under this Agreement.
(ii) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the shares of capital stock of the
Company outstanding as of the Closing Date (not including the Shares)
(the "Outstanding Shares") have been duly and validly authorized and,
assuming receipt of consideration therefor as provided in the
resolutions of the Board of Trustees of the Company authorizing their
issuance, are duly and validly issued and are fully paid and
nonassessable. The Shares have been duly and validly authorized and,
when issued and delivered against payment therefor as provided in
(A) the resolutions of the Board of Trustees of the Company
authorizing their issuance and (B) this Agreement, will be duly and
validly issued, fully paid and nonassessable. The terms of the Shares
and the Outstanding Shares conform in all material respects to all
statements and descriptions thereof contained in the Prospectus.
(iii) The form of certificates to be used to evidence the Shares
are in due and proper form and comply with all applicable requirements
of Title 8 of the Corporations and Associations Article of the Annoted
Code of Maryland, as amended ("Title 8"). The issuance of the Shares
is not subject to any preemptive or other similar rights arising under
the Company's charter or bylaws or Title 8.
(iv) The statements contained in the Prospectus under the
captions "Description of the Preferred Shares of Beneficial Interest"
and "Description of Shares of Beneficial Interest" insofar as those
statements describe Maryland statutes, rules and regulations,
constitute a fair summary thereof.
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(v) This Agreement has been duly and validly authorized,
executed and delivered by the Company, and the Operating Partnership
Agreement has been duly and validly authorized, executed and delivered
by the Company.
(vi) The execution, delivery and performance of this Agreement
by the Company and the consummation of the transactions contemplated
hereby by the Company will not result in any violation of (A) the
provisions of the Company's Declaration of Trust or bylaws, or (B) any
Maryland statute or any order, rule or regulation of any governmental
agency or body of the State of Maryland having jurisdiction over the
Company or any of its properties or assets under Title 8. So far as is
known to such counsel, and except for (C) the registration of the
Shares under the Securities Act and such consents, approvals,
authorizations, registrations or qualifications as may be required
under the Exchange Act or applicable state and foreign securities laws
in connection with the purchase and distribution of the Shares by the
Underwriters, and (D) such consents, approvals, authorizations,
orders, filings or registrations, the absence of which, individually
or in the aggregate, would not have a material adverse effect on the
consummation of the transactions contemplated by this Agreement, no
consent, approval, authorization or order of, or filing or
registration with, any such governmental agency or body of the State
of Maryland is required for the execution, delivery and performance of
this Agreement by the Company and the consummation of the transactions
contemplated hereby.
(vii) The Articles Supplementary have been approved by all
necessary corporate action on behalf of the Company and have been
accepted for record by the SDAT.
(f) Richard L. Rasley, Esq., Co-General Counsel for the Company,
shall have furnished to the Underwriters his written opinion, addressed to the
Underwriters and dated the Closing Date, in form and substance reasonably
satisfactory to the Underwriters to the effect that:
(i) No Transaction Entity is (A) in violation of its
declaration of trust, bylaws, certificate of limited partnership,
agreement of limited partnership or other similar organizational
document or (B) in default in any respect, and no event has occurred
which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, covenant or
condition contained in any material indenture, mortgage, deed of
trust, loan agreement or other material agreement or instrument of
which such counsel is aware to which it is a party or by which it is
bound or to which any of the Properties or any of its other properties
or assets is subject.
(ii) To the knowledge of such counsel, except as disclosed in
the Registration Statement, there are no contracts, agreements or
understandings between the Company and any person granting such person
the right to require the Company to file a registration statement
under the Securities Act with respect to any securities of the Company
owned or to be owned by such person or to require
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the Company to include such securities in the securities registered
pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Securities Act.
(iii) To the knowledge of such counsel, there is no pending
litigation or governmental proceeding required to be described in the
Registration Statement that is not described as required or that would
affect the subject matter of this Agreement.
(g) The Underwriters shall have received from Hunton and Williams,
counsel for the Underwriters, such opinion dated the Closing Date, with respect
to the issuance and sale of the Shares, the Registration Statement, the
Prospectus and other related matters as the Underwriters may reasonably require,
and the Company shall have furnished to such counsel such documents as they
reasonably request for the purpose of enabling them to pass upon such matters.
(h) At the time of execution of this Agreement, the Underwriters
shall have received from Ernst & Young LLP a letter, in form and substance
satisfactory to the Underwriters, addressed to the Underwriters and dated the
date hereof (i) confirming that they are independent public accountants within
the meaning of the Securities Act and are in compliance with the applicable
requirements relating to the qualification of accountants under Rule 2-01 of
Regulation S-X of the Commission, and (ii) stating, as of the date hereof (or,
with respect to matters involving changes or developments since the respective
dates as of which specified financial information is given in the Prospectus, as
of a date not more than five days prior to the date hereof), the conclusions and
findings of such firm with respect to the financial information and other
matters ordinarily covered by accountants' "comfort letters" to Underwriters in
connection with registered public offerings.
(i) With respect to the letter of Ernst & Young LLP referred to in
the preceding paragraph and delivered to the Underwriters concurrently with the
execution of this Agreement (the "Initial Letter"), the Company shall have
furnished to the Underwriters a letter (the "Bring-Down Letter") of such
accountants, addressed to the Underwriters and dated the Closing Date
(i) confirming that they are independent public accountants within the meaning
of the Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, (ii) stating, as of the date of the bring-down letter (or,
with respect to matters involving changes or developments since the respective
dates as of which specified financial information is given in the Prospectus, as
of a date not more than five days prior to the date of the bring-down letter),
the conclusions and findings of such firm with respect to the financial
information and other matters covered by the Initial Letter and (iii) confirming
in all material respects the conclusions and findings set forth in the initial
letter.
(j) The Company shall have furnished to the Underwriters a
certificate, dated the Closing Date, of its Chairman of the Board, its President
or a Vice President and its Chief Financial Officer stating that:
20
<PAGE>
(i) The representations, warranties and agreements of the
Transaction Entities in Section 1 are true and correct as of the
Closing Date; the Company has complied with all its agreements
contained herein; and the conditions set forth in Sections 6(a) and
6(k) have been fulfilled; and
(ii) They have carefully examined the Registration Statement
and the Prospectus and, in their view (A) as of the Effective Date,
the Registration Statement and Prospectus did not include any untrue
statement of a material fact and did not omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading and (B) since the Effective Date, no event has
occurred which should have been set forth in a supplement or amendment
to the Registration Statement or the Prospectus.
(k) (i) No Transaction Entity or Property shall have sustained,
since the date of the latest audited financial statements included 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 or (ii) since such date,
there shall not have been any change in the capital stock or long-term debt
of either Transaction Entity or any change, or any development involving a
prospective change, in or affecting any Property or the general affairs,
management, financial position, stockholders' equity or results of operations
of any Transaction Entity, 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 on the Closing Date on the terms
and in the manner contemplated in the Prospectus.
(l) The Articles Supplementary shall have been filed with the SDAT
and become effective.
(m) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the NYSE or the American Stock Exchange or in the over-the-counter
market, or trading in any securities of the Company on any exchange or in the
over-the-counter market, shall have been suspended or minimum prices shall have
been established on any such exchange or such market by the Commission, by such
exchange or by any other regulatory body or governmental authority having
jurisdiction, (ii) a banking moratorium shall have been declared by Federal or
state authorities, (iii) the United States shall have become engaged in
hostilities, there shall have been an escalation in hostilities involving the
United States or there shall have been a declaration of a national emergency or
war by the United States or (iv) there shall have occurred such a material
adverse change in general economic, political or financial conditions (or the
effect of international conditions on the financial markets in the United States
shall be such) as to make it, in the reasonable judgment of a majority in
interest of the several Underwriters, impracticable or inadvisable to proceed
with the public offering or delivery of the Shares being delivered on the
Closing Date on the terms and in the manner contemplated in the Prospectus.
21
<PAGE>
(n) Application shall have been made, and not withdrawn, to list the
Shares on the NYSE and the Company shall not have received a final notice of the
rejection of such listing application.
(o) The Transaction Entities shall not have failed at or prior to the
Closing Date to have performed or complied with any of their agreements herein
contained and required to be performed or complied with by them hereunder at or
prior to the Closing Date.
(p) On the Closing Date, counsel for the Underwriters shall have been
furnished with such documents and opinions as they may require for the purpose
of enabling them to pass upon the issuance and sale of the Shares as herein
contemplated and related proceedings, or in order to evidence the accuracy of
any of the representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Transaction
Entities in connection with the issuance and sale of the Shares as herein
contemplated shall be satisfactory in form and substance to the Underwriters and
their counsel.
(q) The Company shall have furnished or caused to be furnished to the
Underwriters such further certificates and documents as the Underwriters shall
have reasonably requested.
7. EFFECTIVE DATE OF AGREEMENT. This Agreement shall become effective:
(a) upon the execution hereof by the parties hereto; or (b) if, at the time this
Agreement is executed and delivered, it is necessary for the Registration
Statement or a post-effective amendment thereto to be declared effective before
the offering of the Shares may commence, when notification of the effectiveness
of the Registration Statement or such post-effective amendment has been released
by the Commission.
8. INDEMNIFICATION AND CONTRIBUTION. (a) The Transaction Entities
jointly and severally, shall indemnify and hold harmless the Underwriters, their
officers and employees and each person, if any, who controls any Underwriter
within the meaning of the Securities Act, from and against any loss, claim,
damage or liability, joint or several, or any action in respect thereof
(including, without limitation, any loss, claim, damage, liability or action
relating to purchases and sales of Shares), to which any Underwriter, officer,
employee or controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus or in
any amendment or supplement thereto, (ii) the omission or alleged omission to
state in the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, any material fact required to be stated therein or necessary
to make the statements therein 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 included 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 Transaction Entities shall not be liable under
this clause (iii) to the extent that it is determined in a final judgment 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
22
<PAGE>
the Underwriters through their gross negligence or willful misconduct), and
shall reimburse the Underwriters and each such officer, employee or controlling
person promptly upon demand for any legal or other expenses reasonably incurred
by the Underwriters, officer, employee or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; PROVIDED, HOWEVER,
that the Transaction Entities shall not be liable in any such case to the
extent that any such loss, claim, damage, liability or action arises out of, or
is based upon, any untrue statement or alleged untrue statement or omission or
alleged omission made in the Registration Statement or the Prospectus, or in
any such amendment or supplement, in reliance upon and in conformity with
written information concerning the Underwriters furnished to the Company by or
on behalf of the Underwriters specifically for inclusion therein. The
foregoing indemnity agreement is in addition to any liability which the
Transaction Entities may otherwise have to the Underwriters or to any officer,
employee or controlling person of the Underwriters.
(b) The Underwriters shall indemnify and hold harmless each Transaction
Entity, its officers and employees, each of its trustees and directors, and each
person, if any, who controls each Transaction Entity within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which each Transaction Entity or
any such director, officer or controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus or in any amendment or supplement
thereto or (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, any material fact required to be stated therein or necessary
to make the statements therein not misleading, but in each case only to the
extent that the untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information concerning the Underwriters furnished to the Company by or on behalf
of the Underwriters specifically for inclusion therein, and shall reimburse each
Transaction Entity and any such director, officer or controlling person for any
legal or other expenses reasonably incurred by each Transaction Entity or any
such director, officer or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred. The foregoing indemnity agreement is
in addition to any liability which the Underwriters may otherwise have to each
Transaction Entity or any such director, officer, employee or controlling
person.
(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party in writing of the
claim or the commencement of that action; PROVIDED, HOWEVER, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 8 except to the extent it has been materially
prejudiced by such failure, and PROVIDED FURTHER that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 8. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to
23
<PAGE>
the extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying
party to the indemnified party of its election to assume the defense of such
claim or action, the indemnifying party shall not be liable to the indemnified
party under this Section 8 for any legal or other expenses subsequently
incurred by the indemnified party in connection with the defense thereof other
than reasonable costs of investigation. No indemnifying party shall (i)
without the prior written consent of the indemnified parties (which consent
shall not be unreasonably withheld), settle or compromise or consent to the
entry of any judgment with respect to any pending or threatened claim, action,
suit or proceeding in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise
or consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding, or (ii) be
liable for any settlement of any such action effected without its written
consent (which consent shall not be unreasonably withheld), but if settled with
the consent of the indemnifying party or if there be a final judgment of the
plaintiff in any such action, the indemnifying party agrees to indemnify and
hold harmless any indemnified party from and against any loss or liability by
reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 8(a) or 8(b) in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof, (i) in such proportion
as shall be appropriate to reflect the relative benefits received by the
Transaction Entities on the one hand and the Underwriters on the other from the
offering of the Shares or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Transaction Entities on the one hand and the Underwriters
on the other with respect to the statements or omissions which resulted in such
loss, claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative benefits received by the
Transaction Entities on the one hand and the Underwriters on the other with
respect to such offering shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Shares purchased under this
Agreement (before deducting expenses) received by the Transaction Entities, on
the one hand, and the total underwriting discounts and commissions received by
the Underwriters with respect to the Shares purchased under this Agreement, on
the other hand, bear to the total gross proceeds from the offering of the Shares
under this Agreement, in each case as set forth in the table on the cover page
of the Prospectus Supplement. The 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 Transaction Entities 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 Transaction Entities and the
Underwriters agree that it would not be just and equitable if contributions
pursuant to this Section 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
24
<PAGE>
amount paid or payable by an indemnified party as a result of the loss,
claim, damage or liability, or action in respect thereof, referred to above
in this Section shall be deemed to include, for purposes 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 amount by which the
total price at which the Shares underwritten by it and distributed was
offered exceeds the amount of any damages which the Underwriters have
otherwise paid or become liable to pay by reason of any untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
(e) The Underwriters confirm and each Transaction Entity acknowledges that
the statements with respect to (i) the public offering of the Shares by the
Underwriters set forth on the cover page, (ii) the name of the Underwriters and
the number of Shares that each Underwriter is purchasing and (iii) the
"Underwriting" section of the Prospectus Supplement are correct and constitute
the only information concerning the Underwriters furnished in writing to the
Company by or on behalf of the Underwriters specifically for inclusion in the
Registration Statement and the Prospectus.
9. SUBSTITUTION OF UNDERWRITERS.
(a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder, the non-defaulting
Underwriters may, in their discretion, arrange for the non-defaulting
Underwriters 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
defaulting Underwriter, the non-defaulting Underwriters 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 parties reasonably
satisfactory to the non-defaulting Underwriters to purchase such Shares on such
terms. In the event that, within the respective prescribed periods, the
non-defaulting Underwriters notify the Company that they have so arranged for
the purchase of such Shares, or the Company notifies the non-defaulting
Underwriters that they have so arranged for the purchase of such Shares, the
non-defaulting Underwriters or the Company shall have the right to postpone the
Closing Date 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 the non-defaulting Underwriters' opinion may thereby be made
necessary. The term "Underwriter" as used in this Agreement shall include any
persons substituted under this Section 9 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 made by the
non-defaulting Underwriters and the Company as provided in subsection (a)
above, the aggregate number of Shares which remains unpurchased does not exceed
one-eleventh of the total Shares to be sold at the Closing Date, then
25
<PAGE>
the Company shall have the right to require each non-defaulting Underwriter to
purchase the Shares which such defaulting Underwriter agreed to purchase
hereunder 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 made by the
non-defaulting Underwriters and the Company as provided in subsection (a)
above, the number of Shares which remains unpurchased exceeds one-eleventh of
the total Shares to be sold at the Closing Date, or if the Company shall not
exercise the right described in subsection (b) above to require the
non-defaulting Underwriters to purchase Shares of the defaulting Underwriter or
Underwriters, then this Agreement 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
5 hereof and the indemnity and contribution agreements in Section 8 hereof; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
10. TERMINATION. The obligations of the Underwriters hereunder may be
terminated by the Underwriters by written notice given to and received by the
Company prior to delivery of and payment for the Shares if, prior to that time,
any of the events described in Section 6(i), 6(j) and 6(m) hereof shall not have
been satisfied or if the Underwriters shall decline to purchase the Shares for
any reason permitted under this Agreement.
11. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Company shall fail to
tender the Shares for delivery to the Underwriters by reason of any failure,
refusal or inability on the part of the Transaction Entities to perform any
agreement on their part to be performed, or because any other condition of the
Underwriters' obligations hereunder required to be fulfilled by the Transaction
Entities is not fulfilled, the Transaction Entities will reimburse the
Underwriters for all reasonable out-of-pocket expenses (including fees and
disbursements of counsel) incurred by the Underwriters in connection with this
Agreement and the proposed purchase of the Shares, and upon demand the
Transaction Entities shall pay the full amount thereof to the Underwriters.
12. NOTICES, ETC. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex
or facsimile transmission to A.G. Edwards & Sons, Inc., One North Jefferson
Avenue, St. Louis, Missouri 63103, Attention: Syndicate (Fax: (314) 289-7387);
with a copy to Hunton & Williams, Riverfront Plaza, East Tower, 951 East Byrd
Street, Richmond, Virginia 23219, Attention: Randall S. Parks (Fax: (804)
788-8218).
(b) if to the Transaction Entities, shall be delivered or sent by
mail, telex or facsimile transmission to the Company, 823 Commerce Drive, Suite
300, Oak Brook, Illinois
26
<PAGE>
60523, Attention: Richard L. Rasley (Fax: (630) 368-2929); with a copy to
Jones, Day, Reavis & Pogue, 77 West Wacker, Chicago, Illinois 60601, Attention:
Timothy J. Melton (Fax: (312) 782-8585).
13. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall inure
to the benefit of and be binding upon the Underwriters, the Transaction Entities
and their respective personal representatives and successors. This Agreement
and the terms and provisions hereof are for the sole benefit of only those
persons, except that (i) the representations, warranties, indemnities and
agreements of the Transaction Entities contained in this Agreement shall also be
deemed to be for the benefit of the person or persons, if any, who control any
Underwriter within the meaning of Section 15 of the Securities Act and (ii) the
indemnity agreement of the Underwriters contained in Section 8(b) of this
Agreement shall be deemed to be for the benefit of directors of the Transaction
Entities, officers of the Company who have signed the Registration Statement and
any person controlling the Transaction Entities within the meaning of Section 15
of the Securities Act. Nothing in this Agreement is intended or shall be
construed to give any person, other than the persons referred to in this Section
13, any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision contained herein.
14. SURVIVAL. The respective indemnities, representations, warranties and
agreements of the Transaction Entities and the Underwriters contained in this
Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall survive the delivery of and payment for the Shares and shall
remain in full force and effect, regardless of any investigation made by or on
behalf of any of them or any person controlling any of them.
15. DEFINITION OF THE TERMS "BUSINESS DAY" AND "SUBSIDIARY." For purposes
of this Agreement, (a) "Business Day" means any day on which the NYSE is open
for trading and (b) "Subsidiary" has the meaning set forth in Rule 405 of the
Rules and Regulations.
16. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of New York.
17. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
18. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
27
<PAGE>
IF the foregoing correctly sets forth the agreement between the Company and the
Underwriters, please indicate your acceptance in the space provided for that
purpose below.
Very truly yours,
GREAT LAKES REIT
By: /s/ James Hicks
-----------------------
Title: Treasurer
--------------------
GREAT LAKES REIT, L.P.
By: GREAT LAKES REIT, its
general partner
By: /s/ James Hicks
-----------------------
Title: Treasurer
--------------------
<PAGE>
ACCEPTED:
A. G. EDWARDS & SONS, INC.
By: /s/
--------------------------
Title:
-----------------------
WHEAT FIRST UNION, a division of
Wheat First Securities, Inc.
By: /s/
--------------------------
Title:
--------------------------
EVEREN SECURITIES, INC.
By: /s/
--------------------------
Title:
-----------------------
<PAGE>
Schedule I
<TABLE>
<CAPTION>
Number of Shares
Underwriter to be Purchased
----------- ---------------
<S> <C>
A. G. Edwards & Sons, Inc. . . . . . . . . . . . . . . . . 500,000
Wheat First Union, a division of Wheat First
Securities, Inc. . . . . . . . . . . . . . . . . . . . . 500,000
EVEREN Securities, Inc. . . . . . . . . . . . . . . . . . . 500,000
---------
Total . . . . . . . . . . . . . . . . . . . . . . . . 1,500,000
</TABLE>
I-1
<PAGE>
Exhibit 5.1
[Letterhead of Ballard Spahr Andrews & Ingersoll, LLP]
December 23, 1998
Great Lakes REIT
Suite 300
823 Commerce Drive
Oak Brook, Illinois 60523
Re: Registration Statement on Form S-3
(No. 333-49499)
Ladies and Gentlemen:
We have served as Maryland counsel to Great Lakes REIT, a Maryland
real estate investment trust (the "Company") in connection with certain matters
of Maryland law arising out of the Company's Registration Statement on Form S-3
(No. 333-49499), and all amendments thereto (the "Registration Statement"),
previously declared effective by the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "1933 Act"),
relating to the proposed public offering of securities of the Company that may
be offered and sold by the Company from time to time as set forth in the
prospectus which forms a part of the Registration Statement, and as to be set
forth in one or more supplements to the Prospectus (each, a "Prospectus
Supplement"). This opinion letter is rendered in connection with the sale and
issuance of 1,500,000 9-3/4% Series A Cumulative Redeemable Preferred Shares of
Beneficial Interest, $.01 par value per share (the "Series A Preferred Shares"),
of the Company, pursuant to the Underwriting Agreement, dated December 16, 1998
(the "Underwriting Agreement"), by and among the Company, Great Lakes REIT,
L.P., a Delaware limited partnership (the "Operating Partnership"), A.G. Edwards
& Sons, Inc., Wheat First Union, a division of Wheat First Securities, Inc., and
Everen Securities,
<PAGE>
Great Lakes REIT
December 23, 1998
Page 2
Inc., as described in a Prospectus Supplement, dated December 16, 1998. Unless
otherwise defined herein, capitalized terms used herein shall have the meanings
assigned to them in the Registration Statement.
In connection with our representation of the Company, and as a basis
for the opinion hereinafter set forth, we have examined originals, or copies
certified or otherwise identified to our satisfaction, of the following
documents (hereinafter collectively referred to as the "Documents"):
1. The Registration Statement, and the related form of Prospectus
and form of Prospectus Supplement included therein, in the form in which it was
transmitted to the Commission under the 1933 Act;
2. The Amended and Restated Declaration of Trust of the Company,
including the Articles Supplementary relating to the Series A Preferred Shares
(the "Declaration of Trust"), certified as of a recent date by the Stated
Department of Assessments and Taxation of Maryland (the "SDAT");
3. The Bylaws of the Company, certified as of the date hereof by its
Secretary;
4. Resolutions adopted by the Board of Trustees of the Company, and
a duly authorized committee thereof, relating to the sale, issuance and
registration of the Series A Preferred Shares, certified as of the date hereof
by the Secretary of the Company (the "Resolutions");
5. The form of certificate evidencing a Series A Preferred Share,
certified as of the date hereof by the Secretary of the Company;
6. A certificate of the SDAT as to the good standing of the Company,
dated as of a recent date;
7. A certificate, executed by Richard L. Rasley, Secretary of the
Company, dated as of the date hereof; and
8. Such other documents and matters as we have deemed necessary or
appropriate to express the opinion set forth in this letter, subject to the
assumptions, limitations and qualifications stated herein.
<PAGE>
Great Lakes REIT
December 23, 1998
Page 3
In expressing the opinion set forth below, we have assumed, and so far
is known to us there are no facts inconsistent with, the following:
1. Each individual executing any of the Documents, whether on behalf
of such individual or any other person, is legally competent to do so.
2. Each individual executing any of the Documents on behalf of a
party (other than the Company) is duly authorized to do so.
3. Each of the parties (other than the Company) executing any of the
Documents has duly and validly executed and delivered each of the Documents to
which such party is a signatory, and such party's obligations set forth therein
are legal, valid and binding.
4. Any Documents submitted to us as originals are authentic. Any
Documents submitted to us as certified or photostatic copies conform to the
original documents. All signatures on all such Documents are genuine. All
public records reviewed or relied on by us or on our behalf are true and
complete. All statements and information contained in the Documents are true
and complete. There has been no oral or written modification of or amendment to
any of the Documents, and there has been no waiver of any provision of any of
the Documents, by action or omission of the parties or otherwise.
5. The Series A Preferred Shares will not be issued or transferred
in violation of any restriction or limitation contained in the Declaration of
Trust.
The phrase "known to us" is limited to the actual knowledge, without
independent inquiry, of the lawyers at our firm who have performed legal
services in connection with the issuance of this opinion.
Based upon the foregoing, and subject to the assumptions, limitations
and qualifications stated herein, it is our opinion that:
1. The Company is a real estate investment trust duly formed and
existing under and by virtue of the laws of the State of Maryland and is in good
standing with the SDAT.
<PAGE>
Great Lakes REIT
December 23, 1998
Page 4
2. The Series A Preferred Shares have been duly authorized and, when
and if delivered against payment therefor in accordance with the Underwriting
Agreement and otherwise in the manner provided in the Resolutions, the Series A
Preferred Shares will be duly and validly issued, fully paid and nonassessable.
The foregoing provision is limited to the substantive laws of the
State of Maryland and we do not express any opinion as to compliance with any
federal or state securities laws, including the securities laws of the State of
Maryland.
We assume no obligation to supplement this opinion if any applicable
law changes after the date hereof or if we become aware of any fact that might
change the opinion we express herein after the date hereof.
This opinion is being furnished to you solely for submission to the
Securities and Exchange Commission as an exhibit to the Company's Current Report
on Form 8-K filed with the Commission on the date hereof (the "8-K") and,
accordingly, may not be relied upon by, quoted in any manner to, or delivered to
any other person or entity without, in each instance, our prior written consent.
We hereby consent to the filing of this opinion as an exhibit to the
8-K and to the use of the name of our firm therein. In giving this consent, we
do not admit that we are within the category of persons whose consent is
required by Section 7 of the 1933 Act.
Very truly yours,
/s/ Ballard Spahr Andrews & Ingersoll, LLP
<PAGE>
Exhibit 10.1
FOURTH AMENDMENT TO THE
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
OF GREAT LAKES REIT, L.P.
This Fourth Amendment to the Amended and Restated Agreement of Limited
Partnership of Great Lakes REIT, L.P., a Delaware limited partnership (the
"Partnership"), is made and entered into as of the 23rd day of December, 1998 by
Great Lakes REIT, a Maryland real estate investment trust ("GLREIT").
RECITALS:
WHEREAS, GLREIT is the sole general partner of the Partnership, the
business and affairs of which are conducted in accordance with the terms and
conditions of the Agreement of Limited Partnership of the Partnership dated
September 27, 1996, as amended and restated by the Amended and Restated
Agreement of Limited Partnership dated as of December 19, 1996 and as further
amended by the First Amendment to the Amended and Restated Agreement of Limited
Partnership of the Partnership dated February 6, 1997, the Second Amendment to
the Amended and Restated Agreement of Limited Partnership of the Partnership
dated February 10, 1997 and the Third Amendment to the Amended and Restated
Agreement of Limited Partnership of the Partnership dated May 22, 1998
(collectively, the "Partnership Agreement"); and
WHEREAS, Sections 4.2(c) and 13.1(b)(iii) of the Partnership Agreement
expressly provide that the General Partner shall amend the Partnership Agreement
to set forth the designations, rights, powers and duties, and preferences of the
Preferred Units in one or more Preferred Unit Designations without the consent
of the Limited Partners; and
WHEREAS, the Partnership Agreement provides that a holder of such
Preferred Units shall have such rights to the allocations of Profits and
Losses as specified in Article VI of the Partnership Agreement and to
distributions pursuant to Section 5.1 of the Partnership Agreement;
WHEREAS, in connection with GLREIT's issuance and sale on the date
hereof of 1,500,000 9 3/4% Series A Cumulative Redeemable Preferred Shares of
Beneficial Interest, $.01 par value per share ("Series A Preferred Shares"),
and GLREIT's contribution to the Partnership of the Required Funds obtained
from the issuance and sale of the Series A Preferred Shares, the Partnership
hereby assumes the expenses (including the applicable underwriter discounts)
incurred by GLREIT in connection with raising such Required Funds and issues
to GLREIT Preferred Units to reflect GLREIT's contribution of such funds,
which Preferred Units have the economic rights, including, distribution,
redemption and conversion rights and sinking funds provisions, set forth
herein; and
WHEREAS, GLREIT, as the sole general partner of the Partnership, desires to
amend the Partnership Agreement to reflect the issuance of the Series A
Preferred Units and to set forth the applicable designation, rights, powers,
duties and preferences thereof;
NOW THEREFORE, the Partnership Agreement shall be amended as follows:
1. A series of Preferred Units, designated the 9 3/4% Series A Cumulative
Redeemable Preferred Units (the "Series A Preferred Units"), is hereby
established. The number of authorized Series A Preferred Units is
1,500,000.
<PAGE>
2. The Required Funds obtained from the sale of the Series A Preferred
Shares shall be contributed to the Partnership as Contributed Funds.
3. The Series A Preferred Units shall, with respect to distribution
rights and rights upon liquidation, dissolution or winding up of the
Partnership, rank (a) senior to all classes or series of Partnership
Units, and to all Units issued by the Partnership ranking junior to
such Series A Preferred Units; (b) on a parity with all other Units
issued by the Partnership, the terms of which specifically provide
that such equity securities rank on a parity with the Series A
Preferred Units; and (c) junior to all Units issued by the
Partnership, the terms of which specifically provide that such equity
securities rank senior to the Series A Preferred Units.
4. DISTRIBUTIONS. Section 5.1 of the Partnership agreement is hereby
amended to incorporate the following distribution provisions relating to the
Series A Preferred Units:
a. Holders of the then outstanding Series A Preferred Units shall be
entitled to receive, when and as authorized by the General
Partner, out of Available Cash Flow, cumulative preferential cash
distributions at the rate of 9 3/4% of the $25.00 liquidation
preference per annum (equivalent to a fixed annual amount of
$2.4375 per Series A Preferred Unit). Such distributions shall be
cumulative from the first date on which any Series A Preferred
Units are issued and shall be payable quarterly in arrears on or
before March 1, June 1, September 1 and December 1 of each year
or, if not a business day, the next succeeding business day
(each, a "Series A Partnership Distribution Payment Date"). The
first distribution, which will be paid on March 1, 1999, will
cover the period from the date of issuance of the Series A
Preferred Units to March 1, 1999. Such distribution and any
distribution payable on the Series A Preferred Units for any
partial distribution period will be computed on the basis of a
360-day year consisting of twelve 30-day months. Distributions
will be payable to holders of record as they appear in the
records of the Partnership at the close of business on the
applicable record date, which shall be the fifteenth day of the
calendar month immediately preceding the calendar month in which
the applicable Series A Partnership Distribution Payment Date
falls or on such other date designated by the General Partner as
the record date for the payment of distributions on the Series A
Preferred Shares that is not more than 30 nor less than 10 days
prior to such Partnership Distribution Payment Date (each, a
"Series A Partnership Record Date").
b. No distributions on Series A Preferred Units shall be authorized
by the General Partner or paid or set apart for payment by the
General Partner at such time as the terms and provisions of
any agreement of the Partnership, including any agreement
relating to its indebtedness, prohibits such authorization,
payment or setting apart for payment or provides that such
authorization, payment or setting apart for payment would
constitute a breach thereof or a default thereunder, or if such
authorization or payment shall be restricted or prohibited by
law.
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c. Notwithstanding the foregoing, distributions on the Series A
Preferred Units shall accrue whether or not the terms and
provisions set forth in Paragraph 4.b. hereof at any time
prohibit the current payment of distributions, whether or not the
Partnership has Available Cash Flow, whether or not there are
funds legally available for the payment of such distributions and
whether or not such distributions are declared. Accrued but
unpaid distributions on the Series A Preferred Units will
accumulate as of the Series A Partnership Distribution Payment
Date on which they first become payable.
d. Except as provided in Paragraph 4.e. below, no distributions will
be declared or paid or set apart for payment on any Partnership
Units or any other series of Preferred Units ranking, as to
distributions, on a parity with or junior to the Series A
Preferred Units (other than a distribution in the Partnership
Units or in any other class of Units ranking junior to the Series
A Preferred Units as to distributions and upon liquidation) for
any period unless full cumulative distributions have been or
contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof is set apart for such payment
on the Series A Preferred Units for all past distribution periods
and the then current distribution period.
e. When distributions are not paid in full (and a sum sufficient for
such full payment is not so set apart) upon the Series A
Preferred Units and any other series of Preferred Units ranking
on a parity as to distributions with the Series A Preferred
Units, all distributions declared upon the Series A Preferred
Units and any other series of Preferred Units ranking on a parity
as to distributions with the Series A Preferred Units shall be
declared pro rata so that the amount of distributions declared
per Series A Preferred Units and such other series of Preferred
Units shall in all cases bear to each other the same ratio that
accrued distributions per Series A Preferred Units and such other
series of Preferred Units (which shall not include any accrual in
respect of unpaid distributions for prior distribution periods if
such Preferred Units do not have a cumulative distribution) bear
to each other. No interest, or sum of money in lieu of interest,
shall be payable in respect of any distribution payment or
payments on Series A Preferred Units that may be in arrears.
f. Except as provided in the immediately preceding paragraph, unless
full cumulative distributions on the Series A Preferred Units
have been or contemporaneously are declared and paid or declared
and a sum sufficient for the payment thereof is set apart for
payment for all past distribution periods and the then current
distribution period, no distributions (other than in Partnership
Units or other Units ranking junior to the Series A Preferred
Units as to distributions and upon liquidation) shall be declared
or paid or set aside for payment, nor shall any other
distribution be declared or made, upon the Partnership Units or
any other Units of the Partnership ranking junior to or on a
parity with the Series A Preferred Units as to distributions or
upon liquidation, nor shall any Partnership
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Units, or any other Units of the Partnership ranking junior to
or on a parity with the Series A Preferred Units as to
distributions or upon liquidation be redeemed, purchased or
otherwise acquired for any consideration (or any monies be
paid to or made available for a sinking fund for the
redemption of any such shares) by the Partnership (except by
conversion into or exchange for other Units of the Partnership
ranking junior to the Series A Preferred Units as to
distributions and upon liquidation)
g. Holders of the Series A Preferred Units shall not be entitled to
any distribution, whether payable in cash, property or shares in
excess of full cumulative distributions on the Series A Preferred
Units as described above. Any distribution payment made on the
Series A Preferred Units shall first be credited against the
earliest accrued but unpaid distribution due with respect to such
shares that remains payable.
5. LIQUIDATION PREFERENCE.
a. Upon any voluntary or involuntary liquidation, dissolution or
winding up of the affairs of the Partnership, the holders of
Series A Preferred Units then outstanding are entitled to be paid
out of the assets of the Partnership legally available for
distribution to its unitholders a liquidation preference of
$25.00 per share, plus an amount equal to any accrued and unpaid
distributions to the date of payment, before any distribution of
assets is made to holders of Partnership Units or any other class
or series of Units of the Partnership that ranks junior to the
Series A Preferred Units as to liquidation rights.
b. In the event that, upon such voluntary or involuntary
liquidation, dissolution or winding up, the available assets of
the Partnership are insufficient to pay the amount of the
liquidating distributions on all outstanding Series A Preferred
Units and the corresponding amounts payable on all shares of
other classes or series of Units of the Partnership ranking on a
parity with the Series A Preferred Units in the distribution of
assets, then the holders of the Series A Preferred Units and all
other such classes or series of Units shall share ratably in any
such distribution of assets in proportion to the full liquidating
distributions to which they would otherwise be respectively
entitled.
c. After payment of the full amount of the liquidating distributions
to which they are entitled, the holders of Series A Preferred
Units will have no right or claim to any of the remaining assets
of the Partnership.
d. Written notice of any such liquidation, dissolution or winding up
of the Partnership, stating the payment date or dates when, and
the place or places where, the amounts distributable in such
circumstances shall be payable, shall be given by first class
mail, postage pre-paid, not less than 30 nor more than 60 days
prior to the payment date stated therein, to each record holder
of the Series A Preferred Units (other than the General
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Partner) at the respective addresses of such holders as the
same shall appear on the unit transfer records of the
Partnership.
e. In determining whether a distribution (other than upon voluntary
or involuntary liquidation), by distribution, redemption or other
acquisition of units of the Partnership or otherwise, is
permitted under Delaware law, amounts that would be needed, if
the Partnership were to be dissolved at the time of the
distribution, to satisfy the preferential rights upon dissolution
of holders of Series A Preferred Units will not be added to the
Partnership's total liabilities.
6. REDEMPTION.
a. RIGHT OF OPTIONAL REDEMPTION. The Series A Preferred Units are
not redeemable prior to December 16, 2003. On and after
December 16, 2003, the Partnership, at its option and upon not
less than 30 nor more than 60 days written notice, may redeem the
Series A Preferred Units, in whole or in part, at any time or
from time to time, for cash at a redemption price of $25.00 per
Series A Preferred Unit, plus all accrued and unpaid
distributions thereon to the date fixed for redemption (except as
provided in Section 5(c) below), without interest. If less than
all of the outstanding Series A Preferred Units are to be
redeemed, the Series A Preferred Units to be redeemed shall be
selected pro rata (as nearly as may be practicable without
creating fractional units) or by any other equitable method
determined by the Partnership.
b. LIMITATIONS ON REDEMPTION.
i. The redemption price of the Series A Preferred Units (other
than the portion thereof consisting of accrued and unpaid
distributions) is payable solely out of the contribution
to the Partnership by GLREIT of the sale proceeds of other
shares of beneficial interest of GLREIT, which may include
other series of Preferred Shares, and from no other
source. For purposes of the preceding sentence, "shares of
beneficial interest" means any equity securities (including
Common Shares and Preferred Shares), shares, interest,
participation or other ownership interests (however
designated) and any rights (other than debt securities
convertible
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<PAGE>
into or exchangeable for equity securities) or options to
purchase any of the foregoing.
ii. Unless full cumulative distributions on all Series A
Preferred Units shall have been or contemporaneously are
declared and paid or declared and a sum sufficient for the
payment thereof set apart for payment for all past
distribution periods and the then current distribution
period, no Series A Preferred Units shall be redeemed unless
all outstanding Series A Preferred Units are simultaneously
redeemed, and the Partnership shall not redeem any Series A
Preferred Units (except by exchange for Units of the
Partnership ranking junior to the Series A Preferred Units
as to distributions and upon liquidation); PROVIDED,
HOWEVER, that the foregoing will not prevent the
redemption of Series A Preferred Units pursuant to a
purchase or exchange offer made on the same terms to holders
of all outstanding Series A Preferred Units.
c. RIGHTS TO DISTRIBUTIONS ON SHARES CALLED FOR REDEMPTION.
Immediately prior to any redemption of Series A Preferred Units,
the Partnership shall pay, in cash, any accumulated and unpaid
distributions through the redemption date, unless a redemption
date falls after a Series A Partnership Record Date and prior to
the corresponding Series A Partnership Distribution Payment Date,
in which case each holder of Series A Preferred Units at the
close of business on such Series A Partnership Record Date shall
be entitled to the distribution payable on such shares on the
corresponding Series A Partnership Distribution Payment Date
notwithstanding the redemption of such shares before such Series
A Partnership Distribution Payment Date. Except as provided
above, the Partnership will make no payment or allowance for
unpaid distributions, whether or not in arrears, on Series A
Preferred Units that are redeemed.
d. PROCEDURES FOR REDEMPTION.
i. Notice of redemption will be mailed by the Partnership,
postage prepaid, not less than 30 nor more than 60 days
prior to the redemption date, addressed to the respective
holders of record of the Series A Preferred Units (other
than the General Partner) to be redeemed at their respective
addresses as they appear on the unit transfer records of the
Partnership. No failure to give such notice or any defect
therein or in the mailing thereof shall affect the validity
of the proceedings for the redemption of any Series A
Preferred Units except as to the holder to whom notice was
defective or not given.
ii. Such notice shall state: (A) the redemption date; (B) the
redemption price; (C) the number of Series A Preferred Units
to be
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<PAGE>
redeemed; (D) the place or places where the Series A
Preferred Units are to be surrendered for payment of the
redemption price; and (E) that distributions on the units
to be redeemed will cease to accrue on such redemption date.
If less than all of the Series A Preferred Units held by any
holder are to be redeemed, the notice mailed to such holder
shall also specify the number of Series A Preferred Units
held by such holder to be redeemed.
iii. If notice of redemption of any Series A Preferred Units has
been given and if the funds necessary for such redemption
have been set aside by the Partnership in trust for the
benefit of the holders of any Series A Preferred Units so
called for redemption, then from and after the redemption
date distributions will cease to accrue on such Series A
Preferred Units, such Series A Preferred Units shall no
longer be deemed outstanding and all rights of the holders
of such units will terminate, except the right to receive
the redemption price. Holders of Series A Preferred Units to
be redeemed shall surrender such Series A Preferred Units at
the place designated in such notice and, upon surrender in
accordance with said notice of the certificates evidencing
Series A Preferred Units so redeemed (properly endorsed or
assigned for transfer, if the Partnership shall so require
and the notice shall so state), such Series A Preferred
Units shall be redeemed by the Partnership at the redemption
price plus any accrued and unpaid distributions payable upon
such redemption. In case less than all the Series A
Preferred Units evidenced by any such certificate are
redeemed, a new certificate or certificates shall be issued
evidencing any unredeemed Series A Preferred Units without
cost to the holder thereof.
iv. The deposit of funds with a bank or trust corporation for
the purpose of redeeming Series A Preferred Units shall be
irrevocable except that:
(A) the Partnership shall be entitled to receive from such
bank or trust corporation the interest or other
earnings, if any, earned on any money so deposited in
trust, and the holders of any shares redeemed shall
have no claim to such interest or other earnings; and
(B) any balance of monies so deposited by the Partnership
and unclaimed by the holders of the Series A Preferred
Units entitled thereto at the expiration of two years
from the applicable redemption dates shall be repaid,
together with any interest or other earnings thereon,
to the Partnership, and after any such repayment, the
holders of the shares entitled to the funds so repaid
to the Partnership shall look
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only to the Partnership for payment without interest
or other earnings.
7. The Series A Preferred Units are not convertible into or exchangeable
for any other property or securities of the Partnership.
8. Except as set forth above, no other provision of the Partnership
Agreement shall be affected, amended or modified except to the extent
necessary to conform to the above amendment. Unless defined herein,
all capitalized terms used herein shall have the definitions provided
to such terms in the Partnership Agreement.
9. The foregoing amendment has been approved by GLREIT, in its capacity
as the General Partner of the Partnership without the consent of the
Limited Partners, in accordance with the provisions of Section 13.1 of
the Partnership Agreement.
[Signature Page Follows]
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IN WITNESS WHEREOF, GLREIT has executed this Fourth Amendment to the
Partnership Agreement as of the date first above written.
GREAT LAKES REIT
By: /s/ James Hicks
------------------------------------
Name: James Hicks
Title: Senior Vice President
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